CORPORATE AND PROFESSIONAL UPDATES 21ST JULY 2018

Direct Tax : 

• SC dismisses assessee-company’s SLP against Allahabad HC judgement upholding addition u/s 68 with respect to share capital subscription as assessee failed to establish identity and genuineness of the investors; Noting that assessee is private limited company and alleged investors were close friends and business associates of its directors and shareholders, HC had held that the burden rested squarely on the assessee to disclose true and correct details of the persons making substantial investments in assessee-company; HC e subscribed to its share capital”;[TS-386-SC-2018]
• Mumbai ITAT Special Bench (‘SB’) confirms penalty levy u/s. u/s 271D on assessee -company for receiving cash loans from one of its directors during AY 2008-09 as assessee failed to demonstrate bonafide reasons for not accepting them by account payee cheque/bank draft; Clarifies that bonafide nature of transactions alone not sufficient to claim immunity u/s. 273B and “it is required to be established that there was some bonafide reasons for the assessee for not taking or accepting loan or deposit by account payee cheque or account payee bank draft”, cites SC ruling in Kum. A.B.Shanthi; [TS-387-ITAT-2018(Mum)
• 269SS / 271D Penalty: It is not enough for the assessee to show that the transaction of taking loan/ deposit by cash is genuine or bona fide. It has also to be shown that there was reasonable cause u/s 273B for the assessee being unable to take the loan/deposit by account payee cheque or account payee bank draft- Deepak Sales & Properties Pvt. Ltd vs. ACIT (ITAT Mumbai, Special Bench)

INDIRECT TAX

• It is mandatory for the petitioner to file the Part-B of the e-way bill giving all the details – levy of penalty confirmed – Gati Kintetsu Express Pvt. Ltd. Vs. CCT & Ors (2018 (7) TMI 1097 – M. P. High Court)

FAQ on GST Audit:

• Query:
  

  Under what circumstances can a special audit be instituted?

• Answer:A special audit can be instituted in limited circumstances where during scrutiny, investigation, etc. it comes to the notice that a case is complex or the revenue stake is high. This power is given in section 50 of MGL.

Read more about: What is core Business Activity GST

Read more about: All about GST Offenses, Penalties, and Appeals

SEBI UDATES

• Extends timeline for sending the initial letter by Regd. / Speed Post to physical shareholders for seeking PAN and Bank Details to 30 SEP 2018.

MCA Update:

• MCA21 system will be intermittently unavailable from Saturday, 21st July 2018   22:00 Hrs to Sunday, 22nd July 2018  14:00 Hrs due to maintenance Stakeholders are requested to plan accordingly.

OTHER UPDATES

• No directions interfering with the right of secured creditor bank can be passed by the liquidator where the secured creditor does not wish to participate in the liquidation process- Anil Goel Vs REI Agro Ltd. (NCLT, Kolkata).

• Futures and Options:

Income from F&O is non speculative business Income.

Turnover in that case will be computed total of favorable and unfavorable differences (both taken as positive) plus premium received on Options contracts.

If Turnover as computed in Point 2 above is above INR 2 crores threshold of Tax Audit, then it is required to get accounts audited and File ITR 3 along with Form 3CB/3CD.

If Turnover as computed in Point 2 above is less than INR 2 crores, then tax audit is required only in case Income reported is less than 6% of turnover AND Assessees’ total Income is more than INR 2.50 lakhs.

• Best Option for small F&O Traders

If you want to get saved from tax audit in case of F&O Loss (having less turnover of transactions i.e. upto INR 2 crores), *then declare 6% of the turnover as your income to get saved from tax audit inspite of loss.

KEY DUE DATES

• GSTR-6 (Jul’17 – Jun’18)- Jul 31st, 2018
• Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (Apr-Jun, 2018)-Jul 31st, 2018.