corporate and professional updates 30th march 2018

Direct Tax:

• Mumbai ITAT rules that non-compete fees paid by SOTC Travel Services Pvt  Ltd. (assessee)  during AY 2002-03 to Director/employee of another travel company for not doing similar business for 5 years, not capital expenditure, allows deduction u/s. 37; [TS-143-ITAT-2018(Mum)]
• Delhi ITAT rejects PE-constitution in India for Samsung Electronics (a Korean company- assessee) through the seconded expatriate employees operating from the premises of Samsung India (assessee’s subsidiary) for AYs 2004-05 to 2009-10; [TS-142-ITAT-2018( DEL)]
• Income tax offices and Ayakar Seva Kendras (ASKs) will remain open during holidays from March 29 to 31 to facilitate filing of returns by taxpayers before the end of the current financial year.
• 31-03-18 is last day for filing of ITR 1 to 7 for AY 2017-18 (Note change in law. ITR cannot be filed later) and for AY 2016-17 with penalty of Rs. 5,000
• Pune ITAT rules that assessee is entitled to Sec 10A deduction on additional income offered on account of suo-moto TP-adjustment for AY 2011-12; Notes that TPO/ CIT(A) disallowed the deduction u/s 10A as assessee failed to bring into country the export proceeds in foreign exchange as contemplated in Explanation 2 to Sec 10A in respect of such additional income offered; [TS-116-ITAT-2018( PUN)]
• Benefit of Indexation of cost to be available where shares unlisted on 31.1.18 but are listed on date of transfer which happens on or after1.4.18

 Indirect Tax:

• CBEC has made amendment by way of notification no No.69/2011-Customs, dated the 29thJuly, 2011, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 593 (E), dated the 29th July, 2011.
• CBEC extended the time limit for filing GSTR-1 for turnover above 1.5 crores for the months

• • Apr 18 – 31st may 18
  • May 18 – 10th June 18
  • June 18 – 10th July 18
  • For turnover below 1.5 crores, for the quarter Apr to June 18 to 31st July 18 Vide notification no 17/2018 and 18/2018 dated 28/3/18
• TRANS-2 date extended from 31st march 18 to 30th June 18 due to technical glitches vide order no 1/2018 dated 28/3/18
• Circular 38/12/2018 dt 26.3.18 clarifies job work issues. Reverse charge provisions in case of supplies from unregistered persons deferred-30.6.2018
• Finance Ministry has simplified and reduced the number of columns in the complaint form to make it easier for consumers to report any profiteering activity by businesses post GST rollout

• CBEC has issued Clarifications on exports related refund issues.  Inter alia clarifies processing of claims through amendment through Table 9 of GSTR-1, exports without LUT, refunds in case of exports after specified period of 3 months from date of invoice, issuance of deficiency memos, requirement of self-declaration for non-prosecution, refund of transitional credit, discrepancy between values of GST invoice and shipping bill / bill of export, refund of taxes paid under erstwhile laws, requirement of BRC / FIRC for export of goods, and requirement of invoices for processing of refund claims Vide Circular No. 37/11/2018-GST, dated 15th March 2018.
• E-way bill shall be required wef 01.04.2018 for inter-state supplies where value of consignment  Excluding Exempted goods exceeding Rs. 50000.
• GST has set up camps across India for Exporters refund beginning March 15, CBEC Chairperson Vanaja Sarna said they has already given refunds to the tune of Rs 50 billion but as much as 70 per cent of total refunds to exporters is still stuck even after eight months of GST roll out.

More read:

• Key characteristics for Auto-population of e-invoice
• Overview of Invoice Furnishing Facility (IFF) Under QRMP Scheme

FAQ on Condonation of Delay Scheme (CODS):

• Query:Disqualification of directors of Companies which have been struck off can be removed?
• Answer: In the event of defaulting companies whose names have been removed from the register of companies under section 248 of the Act and which have filed applications for revival under section 252 of the Act up to the date of this scheme, the Director’s DIN shall be re-activated only NCLT order of revival subject to the company having filing of all overdue documents.

RBI Update:

• The Reserve Bank of India has communicated that the applicable average base rate to be charged by Non-Banking Financial Company – Micro Finance Institutions (NBFC-MFIs) to their borrowers for the quarter beginning April 01, 2018, will be 8.99 percent. Vide press release 2017-2018/2580, dated 28th March 2018.
• RBI has issued notification regarding submission of return by the Government-owned Non-Banking Financial Companies. Vide notification no RBI/2017-18/141, dated 15th March 2018.

SEBI updates

• SEBI raised the exposure limit under exchange-traded currency derivatives trading for residents and FPIs to USD 100 million across all currency pairs involving the Indian rupee. The move will help entities engaged in forex transactions to maintain their currency risks in a better manner

 SEBI updates

• Kotak Committee on 5th Oct. 2017 has submitted to SEBI that “Secretarial Audit” to be mandatory for material unlisted subsidiaries of listed companies under SEBI LODR Regulation.
• SEBI New penalty provisions are proposed to be inserted into the SCRA, the SEBI Act, and the Depositories Act in cases where market intermediaries fail to conduct their business in accordance with prescribed rules or regulations.

Securities and Exchange Board of India has approved few amendments in the Securities and Exchange Board of India Listing Obligations and Disclosure Requirements Regulations 2015, in its Board Meeting held :

Business Responsibility Reporting :

• Business Responsibility Reporting to be substituted with Business Responsibility and Sustainability Reporting (BRSR).
• Business Responsibility Reporting to become applicable to top 1000 listed companies on a voluntary basis for Financial Year 2021-22 and on a mandatory basis from Financial Year 2022-23.

Dividend Distribution Policy

• Formulation of Dividend Distribution Policy has been extended to the top 1000 listed companies from 500 listed companies.

Quarterly Compliances

• Timeline for submission of IGR, SHP, CGR harmonized i.e. within 21 days of each quarter.

Compliance Certificates

• The frequency of submission of compliance certificates relating to sharing transfer facility and issuance of share certificates within 30 days of lodgement for transfer, sub-division, etc. is revised from half-year to annual.
• Notice of BM in newspaper
• Newspaper ad for Notice of BM for financial results dispensed with.

Risk Management Committee (RMC)

• Constitution of Risk Management Committee to be applicable to top 1000 listed entities.
• Risk Management Committee should have at least three members with a majority to be BOD and at least one Director should be Independent.
• The role of the Risk Management Committee has been specified which, inter-alia, includes the formulation of a detailed risk management policy and monitoring its implementation; periodic review of such policy; review of the appointment, removal, and terms of remuneration of the Chief Risk Officer (if any), etc.

Other updates

• The government will not further extend the deadline for selling pre-GST stock with revised maximum retail price (MRP) stickers beyond this month, Minister of Consumer Affairs, Food and Public Distribution Ram Vilas Paswan has said.
• A division bench of the Delhi High Court has admitted an appeal against the order of the Single bench in the CA Final Result mismatch case and asks ICAI to produce Documents.

  Key Dates:

• Filing of ITR for AY 2017-18: 31.03.2018
• Filing of ITR for AY 2016-17 with the penalty of Rs. 5000: 31.03.2018
• Filing of GSTR-6 for july 2017-feb-2018 :31.03.2018
• Filing of GSTR-4 for jan-2018-march-2018: 18.04.2018
• Filing of GSTR-1 for feb 2018(turnover more than Rs1.50 cr):10.04.2018