CORPORATE AND PROFESSIONAL UPDATES 19TH JUNE 2018

CORPORATE AND PROFESSIONAL UPDATES 19TH JUNE 2018

Direct Tax :

• Bengaluru ITAT upholds disallowance u/s 40(a)(i) for AY 2011-12 citing failure of assessee to deduct TDS on software payment, sets aside order of CIT(A) who allowed assessee’s ‘impossibility of performance’ plea as jurisdictional HC ruling in Samsung case (dated 15 October 2011) was not available at the time of making software payment.
• ITAT remarks that once CIT(A) held that payment was in the nature of royalty, the disallowance is automatic u/s. 40(a)(i) and CIT(A) has no power to delete such disallowance, even on the ground of impossibility of performance.[TS-307-ITAT-2018( Bang)]
• ITAT rules on comparables selection, treatment of sponsorship, brokerage expenses and miscellaneous income while computing PLI for assessee engaged in providing investment advisory services for AY 2009-10; Excludes 5 comparables (Motilal Oswal, Khandwala Securities, Axis Pvt. Equity, Almondz Global Securities and Milestone Capital Advisors) on grounds of functional dissimilarity, non-availability of segmental data, failing 75% revenue filter etc., follows various precedents.[TS-461-ITAT-2018(DEL)-TP]
• Fee Received by MasterCard from Indian Customers Taxable as ‘Royalty’ not FTS as per Indo-Singapore DTAA:The Authority of Advance Rulings, New Delhi in the application filed by the applicant Mastercard Asia Pacific Pte. Ltd. held that fees received by the services of MasterCard from Indian customers are taxable as “Royalty” and not “Fees from Technical Services”.
• No disallowance for cash payments if transaction is genuine & identity of payee is knownby applying section 40A (3) of Income Tax Act, 1961. M/s A Daga Royal Arts vs. ITO (ITAT Jaipur)

INDIRECT TAX

• E-way bill Mandatory wef 16.6.2018 for B2B Supplies of more than Rs 1 lakh in Delhi. Not required for B2C supplies. Notice 3/2018 of 15.6.2018.
• Centre and the ‘concerned state’ will equally share the amount deposited by erring businesses in the consumer welfare fund set up as part of the GST anti-profiteering rules, as per a Finance Ministry notification.
• The Central Government is all set to bring  35 amendments in the current GST laws including clarification for refunds, changes in the enabling provisions for reverse charge mechanism (RCM) and composition scheme and returns filing etc.
• e-way bill – Where goods moved from a DTA unit to a SEZ unit or vice versa located in the same State, there is no requirement to generate an e-way bill, if the same has been exempted under rule 138(14)(d) of the CGST Rules – Cir.No.47/21/2018-GST, dt.08.06.18.
• GST – e-way bill – transportation of goods by railways – the railways shall not deliver the goods unless the e-way bill is produced at the time of delivery – Cir.No.47/21/2018-GST, dt.08.06.18.
• Services of short term accommodation, conferencing, banqueting etc., provided to a SEZ developer or a SEZ unit shall be treated as an inter-State supply – Cir.No.48/22/2018-GST, dt.14.06.18.

FAQ on E-WAY BILLS:

• Query:If the vehicle, in which goods are being transported, having e-way bill is changed, then what is required to be done?
• Answer:The e-way bill for transportation of goods should always have the vehicle number that is actually carrying the goods. There may be requirement to change the vehicle number after generating the e-way bill or after commencement of movement of goods, due to trans-shipment or due to breakdown of vehicle. In such cases, the transporter or generator of the e-way bill can update the new vehicle number in Part B of the EWB.

MCA UPDATES

• MCA has issued Notification regarding commencement of some of the provisions of the Companies Amendment Act, 2017. The Central Government has appointed 13th June, 2018 as the date on which the provisions of Section 90 (Register of Significant beneficial Owners in a Company).
• Section 93 [omitted] (Return to be filed with Registrar in case of promoter stake changes); Section 94 (Place of keeping and inspection of registers and returns etc.); Section 96 (Annual General Meeting) and Section 216 (Investigation of ownership of Company) of the Companies Act, 2013 shall come into force.

RBI UPDATES

• The Reserve Bank of India (RBI) relaxed its April notification, which forbade FPIs from investing more than 20 per cent of their portfolios in bonds issued by a single corporate group.

OTHER UPDATES

• Employers to whom both PF & ESI applicable can now use common ECR (Electronic Challan cum Return) for PF & ESI atshramsuvidha.gov.in.
• CAs, lawyers and valuers now in the line of FIR for bank frauds- Lawyers, Chartered Accountants and valuers, who collude with fraudulent borrowers, will soon find their names in FIRs lodged by banks. The June 14 advisory was issued by PNB’s fraud risk management division following reports of borrowings against fake property title deeds, fictitious address proofs and sham income tax returns.

KEY DATE:

• QUARTERLY RETURN FOR REGISTERED PERSONS WITH AGGREGATE TURNOVER UP TO RS. 1.50 CRORES: GSTR-1 :-31. JULY 2018
• DUE DATE FOR FILLING GST TRAN-2- 30.06.2018
• DUE DATE FOR GSTR-3B -20.06.2018