corporate and professional updates 18th oct 2018

Image result for corporate and professionalDIRECT TAX

  • Addition on account of un-explained loan – assessee discharged its initial onus to prove the identity of the investor company, its creditworthiness and genuineness of the transaction in the matter – No additions  – ITAT Delhiin case of [Raj Kumar Chawla Vs. ACIT, Central Circle-IX, New Delhi

  • Scope of Exemption u/s 10(20) – Municipal Committee – Scheme of the Rajasthan Urban Improvement Act, 1959 does not permit acceptance of the contention of the appellant assessee that Urban Improvement Trust is a Municipal Committee within the meaning of Section 10(20) Explanation (iii)  – Supreme Court Of Indiain case of [The ITO, CITVs. Urban Improvement Trust, Urban Improvement Trust Kota, Urban Improvement Trust Through Director
  • Reopening of assessment u/s 148 – rejection of objections raised by the assessee – the reopening of the assessment in the writ petitions with reference to Sections 147 to 153 is in accordance with law and there is no infirmity, as such  – Madras High Courtin case of [M/S. South Asia Fm Limited Vs.The ACIT, The DCIT

  • Addition on account of share capital/premium received – The income/losses declared by the investor companies is not a sole criterion to examine the creditworthiness of the shareholders – Psychotropics Leasing & Finance Pvt. Ltd., Vs ITO (2018 (10) TMI 855 – ITAT Delhi)
  • Exemption 10(37) – acquisition of the urban agricultural land as a compulsory acquisition – – merely because the sale price was fixed through a negotiated settlement, the character of acquisition would still remain compulsory – ITO Vs Smt. Girijakumari M (2018 (10) TMI 852 – ITAT Ahmedabad).
  • The revenue department has issued preliminary notices to about 10,000 people under the benami law seeking source of income details as it analyses data on deposits of cancelled notes after the November 2016 demonetisation.
  • Allahabad HC issues notice to CBDT on the issue of levy of interest u/s 234A despite due date extension
  • ITAT Kolkata held that TDS not deductible on Internet connectivity charges & specialized line rental. ACIT Vs SDV International Logistics Ltd. (ITAT Kolkata)
  • Calcutta High Court held that payment by tenant for removal of sub-tenants from property is capital expenditure. nited Spirits Limited Vs Commissioner of Income Tax (Calcutta High Court)
  • Search assessments. The time limit of 2 years u/s 153B for framing search assessment orders applies only to the original order and to orders passed after remand. The time limit for passing remand orders is governed by s. 153(3)/ erstwhile 153 (2A) & not by s. 153B. Limitation begins (for any purpose under the Act) from the point of time when the departmental representative receives the copy of a decision or an order of the ITATSurendra Kumar Jain vs. PCIT (Delhi High Court)
  • Calcutta High Court held that payment by tenant for removal of sub-tenants from property is capital expenditure. nited Spirits Limited Vs Commissioner of Income Tax (Calcutta High Court)

INDIRECT TAX

  • SC upholds the time limitation for claiming ITC i.e. 90 days from the date of purchase or before the end of the FY whichever is later – ALD Automotive Pvt. Ltd. Vs ACT & Ors. (2018 (10) TMI 814 – Supreme Court).
  • Correction of errors in the TRAN-1 declarations – migration to GST Regime – transitional provisions – There is no scope for directing the respondents to allow the petitioner to correct the TRAN-1 declaration already made – Jay Chemical Industries Ltd. Vs Union of India (2018 (10) TMI 876 – Gujarat High Court).
  • Supreme Court of India in Section 19 (11) of TNVAT Act,2006-Cases failure to claim ITC with in the time prescribed has since been disposed off. The SC has dismissed all the Civil Appeals of the dealers.
  • Delhi High Court allows manual filing of GSTR-3B. IndusInd Media & Anr. Vs. Union of India & Ors. W.P. (c) No. 8691/2018.
  • The Gujarat High Court has issued the notice to Centre and GST Council on a petition challenging the provisions of Central Goods and Services Tax (CGST) Act, seeking interest for delayed IGST Refund.
  • AAR Punjab held that GST Payable on complementary IPL tickets & ITC can be claimed. In re KPH Dream Cricket Pvt. Ltd. (GST AAR Punjab)
  • Punjab and Haryana HC held that No GST on license Fee for sale of liquor for human consumption.DivyaSinglaVs Union of India (Punjab and Haryana HC

FAQ ON GST

  • Query:Other than appellate remedy, is there any other recourse available to the taxpayer against a summary assessment order?
  • Answer:A taxable person against whom a summary assessment order has been passed canapply for its withdrawal to the jurisdictional Additional/Joint Commissioner within thirty days of the date of receipt of the order. If the said officer finds the order erroneous, he can withdraw it and direct the proper officer to carry out determination of tax liability in terms of section 51 of MGL. The Additional/Joint Commissioner can follow a similar course of action on his own motion if the finds the summary assessment order to be erroneous (section 48 of MGL).
  • Query: Under what circumstances can a special audit be instituted?

  • Answer:A special audit can be instituted in limited circumstances where during scrutiny, investigation, etc. it comes to the notice that a case is complex or the revenue stake is high. This power is given in section 50 of MGL.

MCA UPDATES

  • The Ministry of Corporate Affairs (MCA) has ordered a probe by the Serious Fraud Investigation Office(SFIO) into allegations of suspected audit and financial fraud running into Rs 7,500 crore by the city-based Ramky Infrastructure Limited after the Registrar of Companies, Ranchi, flagged the issue.
  • Leading foreign bank to drag Kwality to NCLT over Rs 12 billion default.

SEBI UPDATES

  • SEBI is planning to relax rules for listing of startups in India, which include giving promoters the flexibility to categorise themselves as ordinary shareholders and exempting them from the mandatory three-year lock-in period – ET.
  • SEBI clarified with respect to amendments to regulation 40 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, which stated that transfers of listed securities would not be processed after 5 December 2018, unless such securities are held in a dematerialized form with a depository.

RBI UPDATES

  • Govt and RBI are not in favour of extending the deadline to store payments data mirroring by payments firms as an alternative to only storing data locally, The central bank has mandated that all payment firms, including MasterCard, Visa, American Express and Paypal, should store their India related data locally.
  • The Reserve Bank of India on Tuesday laid out guidelines that would allow for seamless payments between different mobile wallets, in a move that could further boost the use of digital payments in the country.
  • RBI will not relax the October 15 deadline for global financial technology (fintech) companies to comply with its data localisation norms in the public interest.
  • RBI sold the highest amount of dollars in five years to curb the slide in the rupee. In the five months April-August, RBI sold almost $34 billion in spot and forward markets $18.6 billion in spot and $15 billion in forwards.

OTHER UPDATES

  • NBFCs are likely to be impacted significantly if the liquidity situation, triggered by IL&FS default, continues to remain tight as its subsidiaries are facing liquidity crisis and has defaulted on debt repayment. The default by IL&FS has also impacted other NBFCs and also mutual fund players.
  • Bank of Baroda invites proposals from Chartered Accountant Firms/Groups for conducting financial and tax due diligence of Bank of Baroda, Dena Bank and Vijaya Bank for the proposed amalgamation.
  • Private sector lender ICICI Bank Tuesday said the RBI has approved Sandeep Bakshi’s appointment as Managing Director and CEO of the bank for three years. After the resignation of Chanda Kochhar, who was facing inquiry, earlier this month, the bank’s board had elevated Chief Operating Officer (COO) Bakshi as the new managing director and CEO for three years until October 3, 2023, subject to regulatory and other approvals.
  • Prime Minister Narendra Modi has urged oil suppliers to review payment terms to give temporary relief to the rupee, which has fallen sharply in recent months.
  • Central Vigilance Commission has completed a first-of-its-kind analysis of the top 100 banking frauds, including those in the jewellery and aviation sectors, and shared its findings with the RBI, the ED and the CBI The analysis focused on the methods used, amount involved, type of lending (consortium or individual), anomalies observed and loopholes that led to the frauds, along with recommendations to plug the gaps in the system
  • ICAI has given an opportunity to students to change the Centre or Group or Medium as filled by them in examination form from 15.10.2018 to 24.10.2018 fee Rs. 1000.

KEY DUE DATES

October 2018 Due Dates:

  • 31st October- TCS Return for Jul to Sep 2018- Tax Audit & ITR for FY 2017-18
  • 18th October- GSTR 4 for Composition Dealer for Jul 2017 to Sep 2018
  • 20th October- GSTR 3B – Sep 2018 Month
  • 30th October- AOC 4 for FY 2017-18
  • 31st October- GSTR 1 for July 2017 to Sep 2018
  • 31st Oct- TDS Return for Jul to Sep 2018

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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corporate and professional updates 04th aug 2018

Image result for professional updatesDirect Tax :

  • Indore ITAT rules that CIT is not empowered to direct AO to issue notice u/s 143(2) after expiry of normal limitation period, quashes time-barred assessment for AY 2000-01 on assessee-firm; Notes that assessee had filed revised return in April, 2001 (original return was filed within Sec 139 time-limit) to claim refund of TDS and made an application u/s. 119 to regularize the revised return which was allowed by CIT (vide CIT’s order of January, 2008) who directed AO to determine refund after scrutinizing the case by issue of notice u/s 143;[TS-424-ITAT-2018(Ind)]
  • Bombay HC upholds ITAT order in case of Mr. Fardeen Khan (assessee), rules that there was no transfer u/s 2(47)(v) upon entering into Development Agreement during subject AY 2008-09, since it was not registered; Assessee had entered into a Development Agreement (‘DA’) in April, 2007  whereby 13 acres of land owned by assessee was given for development to M/s. Godrej Properties (‘developer’) and assessee received Rs.13.75 cr. as deposit;[TS-425-HC-2018(BOM)]
  • Delhi ITAT accepts assessee’s (company incorporated in Cyprus) contention of non-constitution of ‘installation PE’ under clause 5(2)(g) of India Cyprus treaty pursuant to award of contract  by another foreign entity (AMC) for placement of rock in seabed for laying of gas pipelines and other work;Rejects Revenue’s contention that assessee’s activity went beyond 12 months threshold period prescribed for installation PE, observes that AO and DRP wrongly concluded that assessee was involved in multifarious functions by considering the scope of work to be carried by AMC as scope of work for assessee; [TS-426-ITAT-2018( DEL)]

INDIRECT TAX

  • Applicability of GST on ambulance services provided to Government by private service providers under the National Health Mission (NHM).
  • Withdrawal of Circular No. 28/02/2018-GST dated 08.01.2018 as amended vide Corrigendum dated 18.01.2018 and Order No 02/2018–Central Tax dated 31.03.2018.

FAQ on GST Audit:

  • Query: What is the time limit to submit the audit report?
  • Answer:The auditor will have to submit the report within 90 days or within the further extended period of 90 days.
  • Query: Who can serve the notice of communication for special audit?
  • Answer:The Assistant / Deputy Commissioner is to serve the communication for special audit only after prior approval of the Commissioner.

MCA Update:

  • MCA has made amendment in Companies (Accounts) Rules , 2014.These rules may be called the Companies (Accounts ) Amendments Rules,2018 which shall come into force on the date  of their publication in the official Gazetee.
  • Form ADT-1 is likely to be revised on MCA21 Company Forms Download page w.e.f 3rd AUG, 2018. Stakeholders are advised to check the latest version before filing.
  • To make the Swachh Bharat Mission truly universal and inclusive, all Union Ministers and Departments of Government of India observe SwatchhtaPakhwada and lead the Process in turns.

RBI Update:

  • In the Third Bi-monthly Monetary Policy Statement 2018-19 of the Monetary Policy Committee (MPC), the repo rate under the Liquidity Adjustment Facility (LAF) has been increased by 25 basis points to 6.50 per cent from 6.25 per cent with immediate effect.

OTHER UPDATES

  • Multipurpose Empanelment Form for the year 2018-19: Practicing Chartered Accountants are invited to fill the Multipurpose Empanelment Form (MEF) http://www.meficai.org/ or www.pdicai.org/
  • For any other query/clarification, please lodge your complaint online on MEF Application itself. If the same is not resolved within 3 working days,
  • please contact PDC Secretariat at mefpdc@icai.in or 011-30110444 /440 between 3.00 pm to 5.00 pm.
  • The last date for submission of online MEF Form for the year 2018-19 is 21st August, 2018 and online Declaration is to be submitted within 10 days of the filling of MEF but not later than 30th August, 2018.

 KEY DUE DATES 

  • GSTR-3B (JULY 2018)-AUG 20th, 2018
  • GSTR-5 (JULY 2018)-AUG 20th, 2018
  • GSTR-6 (JULY 17 – AUG’18)- SEP 30TH, 2018
  • GSTR-4 (JULY-SEP, 2018)-OCT 18th, 2018
  • GSTR-5A (JULY 2018)-AUG 20th, 2018
  • Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (JULY- SEP, 2018)-OCT 10TH, 2018.
  • Quarterly return for registered persons with aggregate turnover more than Rs. 1.50 Crores- GSTR-1-(july 2018)-Aug 10th 2018

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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CORPORATE AND PROFESSIONAL UPDATES 21ST JULY 2018

Image result for CORPORATE UPDATESDirect Tax : 

  • SC dismisses assessee-company’s SLP against Allahabad HC judgement upholding addition u/s 68 with respect to share capital subscription as assessee failed to establish identity and genuineness of the investors; Noting that assessee is private limited company and alleged investors were close friends and business associates of its directors and shareholders, HC had held that the burden rested squarely on the assessee to disclose true and correct details of the persons making substantial investments in assessee-company; HC e subscribed to its share capital”;[TS-386-SC-2018]
  • Mumbai ITAT Special Bench (‘SB’) confirms penalty levy u/s. u/s 271D on assessee -company for receiving cash loans from one of its directors during AY 2008-09 as assessee failed to demonstrate bonafide reasons for not accepting them by account payee cheque/bank draft; Clarifies that bonafide nature of transactions alone not sufficient to claim immunity u/s. 273B and “it is required to be established that there was some bonafide reasons for the assessee for not taking or accepting loan or deposit by account payee cheque or account payee bank draft”, cites SC ruling in Kum. A.B.Shanthi; [TS-387-ITAT-2018(Mum)
  • 269SS / 271D Penalty: It is not enough for the assessee to show that the transaction of taking loan/ deposit by cash is genuine or bona fide. It has also to be shown that there was reasonable cause u/s 273B for the assessee being unable to take the loan/deposit by account payee cheque or account payee bank draft- Deepak Sales & Properties Pvt. Ltd vs. ACIT (ITAT Mumbai, Special Bench)

INDIRECT TAX

  • It is mandatory for the petitioner to file the Part-B of the e-way bill giving all the details – levy of penalty confirmed – Gati Kintetsu Express Pvt. Ltd. Vs. CCT & Ors (2018 (7) TMI 1097 – M. P. High Court)

FAQ on GST Audit:

  • Query:

    Under what circumstances can a special audit be instituted?

  • Answer:A special audit can be instituted in limited circumstances where during scrutiny, investigation, etc. it comes to the notice that a case is complex or the revenue stake is high. This power is given in section 50 of MGL.

SEBI UDATES 

  • Extends timeline for sending the initial letter by Regd. / Speed Post to physical shareholders for seeking PAN and Bank Details to 30 SEP 2018.

MCA Update:

  • MCA21 system will be intermittently unavailable from Saturday, 21st July 2018   22:00 Hrs to Sunday, 22nd July 2018  14:00 Hrs due to maintenance Stakeholders are requested to plan accordingly.  

OTHER UPDATES

  • No directions interfering with the right of secured creditor bank can be passed by the liquidator where the secured creditor does not wish to participate in the liquidation process- Anil Goel Vs REI Agro Ltd. (NCLT, Kolkata).
  • Futures and Options:

Income from F&O is non speculative business Income.

Turnover in that case will be computed total of favorable and unfavorable differences (both taken as positive) plus premium received on Options contracts.

If Turnover as computed in Point 2 above is above INR 2 crores threshold of Tax Audit, then it is required to get accounts audited and File ITR 3 along with Form 3CB/3CD.

If Turnover as computed in Point 2 above is less than INR 2 crores, then tax audit is required only in case Income reported is less than 6% of turnover AND Assessees’ total Income is more than INR 2.50 lakhs.

  • Best Option for small F&O Traders

If you want to get saved from tax audit in case of F&O Loss (having less turnover of transactions i.e. upto INR 2 crores), *then declare 6% of the turnover as your income to get saved from tax audit inspite of loss.

KEY DUE DATES

  • GSTR-6 (Jul’17 – Jun’18)- Jul 31st, 2018
  • Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (Apr-Jun, 2018)-Jul 31st, 2018.
Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associates , a leading Tax & Investment Planning Advisory Service Provider. His blog can be found at http://carajput.com/blog/For any query you can write to info@carajput.com. Hope the information will assist you in your Professional endeavors. For query or help, contact:   info@carajput.com or call at 09811322785/4 9555 5555 480)

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