CORPORATE AND PROFESSIONAL UPDATE May 20, 2017
Page Contents
Direct Tax:
· S. 56(2)(vi): A HUF is a “group of relatives”. Consequently, a gift received from a HUF by a member of the HUF is exempt from tax as provided in the Explanation to s. 56(2)(vi) DCIT vs. Ateev V. Gala (ITAT Mumbai)
· S. 68 cash credit: If the assessee has explained the source of the loans received by it, the fact that the lender may have raised bogus share capital to advance the funds to the assessee does not mean that the loan received by the assessee can be treated as unexplained income.
· A statement recorded under duress, which is retracted later, cannot be the sole basis for addition Anil Chhaganlal Jain vs. ACIT (ITAT Mumbai)
Due date of filing of Form 61A of Income Tax for specified persons is 31st May 2017.
· Income Tax department published names of five entities owing over Rs 10 crore in taxes, as part of its strategy to name and shame big defaulters
Indirect Tax:
Centre releases GST Rate Schedule of Goods as well as GST Compensation Cess Rates for different supplies, pursuant to GST Council meeting today; “Rate Schedule” contains 98 chapters categorized into Nil, 5%, 12%, 18% and 28% tax slabs.
Read more about: What is core Business Activity GST
Read more about: Important decisions made at the 43rd GST Council meeting
GST Updates:
GST Council has broadly approved the GST rates for goods at nil rate, 5%, 12%, 18% and 28% to be levied on certain goods. The Council has also broadly approved the rates of GST Compensation Cess to be levied on certain goods.
GST Council finalises Rates of Cess on Pan Masala (60%), cold drinks (12%), Tobacco, Tobacco products, Cigarettes, Motor vehicles (1% to 15%) etc.
GST Council finalises rates of 1211 Goods under 98 categories. Rates for textiles, footwear, biris, precious metals etc& services to be decided.
Key dates:
E-payment of DVAT & CST for April: 05.2017
Payment of ESI of April:05.2017
Issue of DVAT certificates for deduction made in April: 05.2017
FAQ on GST
Query: Whether a person applying for new registration within thirty days of becoming liable for registration or applying for voluntary registration would be entitled to claim of credit of tax paid on Capital Goods held on the date of registration?
Answer: No, Capital goods held by person as on date of registration would not be eligible for claim of Input Tax Credit. Thus, in the case of capital intensive Industries, registration would have to be taken right at the time of commencement of set up of business and before any purchase of capital goods have been made, otherwise any delay might result in loss of Input tax Credit paid on Purchase of Capital goods.
Other Updates
ICAI advised the members involved in Coaching/Teaching Activities to abstain from advertising their association with Coaching /teaching activities through hoardings, posters, banners and by any other means, failing which they may be liable for disciplinary action, as per the provisions of Chartered Accountants Act, 1949 and Rules /Regulations framed thereunder Vide Announcement dated 18.05.2017.
MCA Update:
MCA issued clarification regarding applicability of Section 16(1)(a) of the Companies Act, 2013 with reference to cases under corresponding provisions of Companies Act, 1956 Vide Circular No 04/2017 dated 16.05.2017.
Time barred plea for rectification of name once rejected can’t be filed afresh under Companies Act, 2013: MCA CIRCULAR NO.4/2017 [F.NO.17/89/2016-CL-V], DATED 16-5-2017.
RBI relaxed the branch authorization policy, bringing all branches and fixed business correspondent outlets under the definition of banking outlets and removing restrictions on opening branches in Tier 1 centers
Quotes of the Day:
“A man who dares to waste one hour of time has not discovered the value of life.”
“Be not afraid of life. Believe that life is worth living, and your belief will help create thefact.”.
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