Professional Update For the Day:


Direct Tax:-

Delhi High Court held that in case of assessees engaged in providing telecom services deduction under Section 80IA shall be allowed in respect of even those incidental incomes earned during the course of telecom business not derived from core business operations. (Pr. CIT vs. Bharat Sanchar Nigam Ltd. (Delhi High Court)

ITAT Delhi Held that  Section 14A of Income Tax Act,1961 cannot be invoked, where no regular activities were undertaken by the Assessee in respect of the investments to earn exempt income and no change in the investments during the year (M/s Power Grid Corporation of India Ltd. Vs DCIT (ITAT Delhi))

Bad-debts and its provision should be considered for computing margin of comparable companies Sum Total Systems India (P.) Ltd. v. Deputy Commissioner of Income-tax, Circle 3 (2), Hyderabad [2016] 74 247 (Hyderabad – Trib.)

No disallowance of scientific research exp. just because benefit of research not shown in relevant year FFC Aromas (P.) Ltd. v. Income-tax Officer, Ward 8(1)(4), Mumbai [2016] 75 4 (Mumbai – Trib.)

Apex Court dismissed appeal as tax effect for filing appeal was less than prescribed limit Shirish Madhukar Dalvi v. Assistant Commissioner of Income-tax [2016] 75 11 (SC)

Interest exp. should be allowed if it was incurred for arranging deposit for rental business premises; SLP dismissed Jalan Distributors (P.) Ltd. v. Commissioner of Income-tax, Kolkata
[2016] 75 13 (SC)

CBDT has issued Circular on 2nd Nov 2016 on Chapter VI-A deduction on enhanced profits, by virtue of which expenditure disallowed if related to the business activity against which the Chapter VI-A deduction has been claimed, the deduction needs to be allowed on the enhanced profits.

Capital gain tax will be paid by the partners of the dissolved partnership firm on the sale of its assets.{Vatsala Shenoy Vs. JCIT, Supreme Court of India}.

Indirect Tax:-|

Allahabad High Court held that the assessee cannot be forced to pay entire disputed amount when the assessment proceedings are pending and The department can only take action to ensure compliance of order passed by the Court.(Prosper Build Home Pvt. Ltd. V/s. Union Of India (Allahabad High Court))

Authority of Advance Rulings held that a revenue sharing arrangement by creating a partnering person shall be liable to service tax if the partners are providing taxable service to one another in execution of partnering purpose even if the purpose of creating partnering person is non-taxable. (Re M/s Choice Estates and Constructions Ltd (Authority for Advance Rulings))

US Presidential Elections and Indian markets :-There is always room for speculation as to how would markets be affected by the outcome of the USA Presidential Elections. The last 5 Elections generally indicate that while there could be disturbances in the stock market movements, GSec yields and exchange rate have followed trends as they are driven probably mainly by fundamentals. The stock market too has shown continuity over months, though there could be deviations at times. One may hence be tempted to conclude that the Indian markets may be relatively less affected by the outcome. But it should also be noted that the Elections this time are being contested by candidates who have strong differing views on the economy and globalization, which can have deeper impact on global markets – not witnessed before in the last 5 Elections in case the Republican party comes to power.


RBI allowed banks to issue rupee-denominated bonds or Masala bonds in the overseas market to shore up their capital base as well as for financing infrastructure and affordable housing.


Under GST Upto 10 bank accounts can be added during enrolment. Proof of Bank A/c No,  Branch, Address of A/c holder & few transaction details required.

GST Portal ( has been launched Today. The Registration for Northern Region, viz. Delhi, Chandigarh, Haryana, Punjab, Himachal Pradesh & Jammu & Kashmir shall commence on 16 DEC 2016 and will end on 31 DEC 2016.

Enrolment  in GST begins at Delhi, Haryana, UP, Punjab from 16-31 Dec .  Gujarat, Maharastra 14-29 Nov. ST assessees in Jan 2017.


Rs.500 &1000 currency notes acceptable at certain Govt. places(hospitals, Milk booths, rail & Airline ticket counters, buses , Fuel stations)till 11.11.16 midnight.

Please deposit Rs.500/1000 note at Bank branch upto 30.12.16. Exchange upto Rs.4000, withdraw upto Rs.10000 at Branch from 10.11.16 or Rs.2000 at ATM from 11.11.16.

Tolls are Free till 11 Nov 16 and banks will remain open on saturday andsunday.

MCA issues The Companies (Registration Offices and Fees) Second Amendment Rules, 2016, effective from 07.11.16.

Key Dates:

E.R-1 Return for Non-SSI assessee for October-10.11.2016

We look forward for your valuable comments.

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