corporate and professional update january 20, 2016

 

CORPORATE AND PROFESSIONAL UPDATE JANUARY  20, 2016

• Government of India has vide its Notification F.No. 4(19)-W&M/2014 dated 14.01.2016 announced that the Sovereign Gold Bonds, 2016 will be open for subscription from 18.01.2016 to 22.01.2016.
• Refunds up to Rs.5,000/- and refunds in cases where arrear demand is up to Rs.5,000/- may be issued without any adjustment of outstanding arrears under section 245 of the Act during financial year 2015-2016.
• Protocol amending the agreement between Government of the Republic of India and the Government of the Republic of Belarus for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on property (Capital) notified vide notification no. 2/2016.
• Transfer pricing adjustment – TPO take the amount of ALP at NIL – determination of Management Consultancy Fee – foreign exchange loss in financial transactions cannot be considered as service charge for the intra group- (M/s. DQ Entertainment (International) Ltd, Versus Asst. Commissioner of Income Tax, Circle-1 (2) , Hyderabad – 2016 (1) TMI 451 – ITAT HYDERABAD).

DIRECT TAX

• DTAA: Amendment made in the Agreement between Republic of India and the Government of the Republic of Belarus to make the treaty effective from 19 NOV 2015 – Notification No.2/2016, Dt.13th Jan 2016.
• Initiatives taken by CBDT to reduce litigation.
• Now CBDT would issue refunds up to Rs. 5,000 without adjustment of outstanding tax liability.
• CBDT notifies forms for accumulation of income by a trust.
• Initiation of penalty proceedings u/s 271(1)(c) without specifying basis makes such proceedings void -ab-initio.
• Tax Reforms Committee submits its first report :Recommends presumptive scheme for professionals, lower TDS rates.

SERVICE TAX

• ST: is considering higher Service Tax Exemption Limit to benefit small service provides.
• Likely to hike Service Tax exemption threshold for small service providers “service tax exemption threshold limit could be hiked from Rs 10 lakh to Rs 25 lakh.” said a government source.
• Service-tax: ‘Mistaken payment’ of service tax in excess of actually payable amount amounts to ‘deposit’ and time-limit of section 11B would not apply to refund thereof [2016] 57 (Ahmedabad – CESTAT) Nobles Constructions Gujarat (P.) Ltd. v. Commissioner of Service Tax.
• No denial of Cenvat credit availed on invoices issued in the name of branch offices, which were not registered [Manipal Advertising Services Pvt. Ltd. vs. C.C.E., Mangalore (2009 (10) TMI 434 – CESTAT, BANGALORE)].
• Central Government hereby appoints the 13th day of January, 2016 as the date on which the provisions of sub-section (5), sub-section (6) [except with respect to the manner of administration of the investor Education and Protection Fund] and sub-section (7) of section 125 of the said act shall come into force.
• No service tax on advance received as an earnest money for which bank guarantee of equal amount is given to the customers [Thermax Instrumentation Ltd. vs. Commissioner of Central Excise, Pune – I (2015 (12) TMI 1222 – CESTAT MUMBAI)].
• All Govt. entities in Delhi to file return for purchases made by them for purpose of consumption.
• Startup India: Hon’ble PM Modi launches Startup India Program on Sat, 16 JAN 2016 to boost innovation based business with many incentives and ease of doing business.
• New Juvenile Justice Act comes into force from Jan 15, 2016.

Sebi updates

• SEBI looking to lower expense charges for mutual funds.
• SEBI: SEBI has established its Local Office at Jammu under the administrative control of its Northern Regional Office at New Delhi.
• Minister of State for Finance Jayant Sinha on Thursday said that the government will present the Budget for 2016-17 on February 29, 2016.
• TDS rates for individuals be reduced to 5% from 10%.
• Making the process of refunds fasterand pay 12-18% interest if refund issued beyond 6 months.
• Deferring the contentious Income Computation and Disclosure Standards (ICDS) provision.

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