CORPORATE AND PROFESSIONAL UPDATE May 8, 2017

Professional Update for the day:

Direct Tax:

• Allahabad High Court held that contention of the learned counsel for the petitioner is that the petitioner be allowed to appear before the authority concerned for recording the statement under Section 108 of the Customs Act in the presence of his counsel as no substance as there is no statutory provision which may allow a person to appear along with his counsel before the authorities concerned while his statement under Section 108 of the Customs Act is to be recorded. [Pawan Kumar Pawan Arora Vs Union of India]
• CBDT releases New Rules under Sec 115BA(4) & Form10-IB for Startups to Opt for Lower Tax Rate.
• IT: Non deduction of TDS – the word payable u/s 40(a)(ia) also covers the cases where the amount is actually paid during the year – Palam Gas Service Vs CIT (2017 (5) TMI 242 – Supreme Court).
• CBDT releases Draft Rules for Valuation of Unquoted Equity Shares

Indirect Tax:

• ITAT Mumbai held that keeping in view the principle of mutuality the assessee is not required to deduct tax at source on payments to KPMG International. Since the very basis for levy and upholding of penalty under section 271C of the Act by the authorities for assessment years 2000- 01 and 2002-03 to 2004- 05 does not survive, the orders levying/upholding the aforesaid penalty are not sustainable. [ M/s. KPMG Vs Additional C.I.T. (International Taxation)]

FAQ on GST

What will become costlier and cheaper in GST?

According to experts, these items could become costlier:

• Cigarette prices likely to go up as GST rate for tobacco will be higher than current duties
• Commercial vehicles such as trucks will become costlier
• Mobile phone calls may get costlier as service tax will go up
• Textile and branded jewellery may become costlier

And these could become cheaper:

• Auto: Prices of entry-level cars, two-wheelers, SUVs may fall
• Car batteries likely to get cheaper
• Paint, cement prices likely to fall
• Movie ticket prices likely to fall as entertainment tax will come down
• Electronics items like fans, lighting, water heaters, air coolers, etc. will get cheaper

Other Updates

• NPAs: notifies Ordinance on banks’ non-performing assets on Friday. RBI can now direct banks to order action against loan defaulters apart from getting lenders to initiate insolvency and bankruptcy proceedings.
• Prime Minister has asked the revenue department to scale up e-assessment facilities to cover 25 cities, take corrupt officers to task and promote a regime friendly to taxpayers. He also asked the department to train guns on benami properties and focus on broadening the tax net.
• RBI advised public sector banks to put in place a fair and transparent mechanism for appointment of statutory branch auditors.
• Govt notified changes to the Banking Regulation Act, giving the RBI broad powers to deal with specific bad-loan cases as it tries to speed up resolution of Rs 9.64 trillion of stressed assets clogging the Indian banking system.

Key dates:

• Return of non – SSI assesses for April : 10.05.2017
• Return by units paying duty > 1 crore (CENVAT + PLA) for April : 10.05.2017

Quote of the Day:

“Faith is the art of holding on to things your reason has once accepted, in spite of your changing moods.”

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