CORPORATE AND PROFESSIONAL UPDATES 9TH JULY 2018

Direct Tax :

• Delhi ITAT deletes Sec. 40(a)(i) disallowance of Rs. 120 cr. for airfreight payments made by assessee (a logistic and Cargo handling company) without TDS to non-resident parties during AY 2014-15; Observes that assessee did not claim the airfreight as expenses in the P & L account as the payments were made on behalf of its Indian clients/customers (who reimbursed the amount to assessee); [TS-354-ITAT-2018( DEL)]
• Kolkata ITAT allows the long term capital loss claim on off-market sale of shares by assessee to its group company during AY 2009-10; Rejects Revenue’s stand that the off market transaction with group company was a colourable device only to claim the loss and reduce the tax burden;Observes that in present case, the share-sale transaction was duly supported by the required documentary evidence, delivery instructions were also issued to the depository participant evidencing that there was actual delivery of shares; [TS-349-ITAT-2018(Kol)]

• CBDThas issued Final Notification (applicable from AY 2017-18) for exception, modification and adaptation in respect of a foreign company said to be resident in India due to its place of effective management (POEM) being in India, u/s 115JH of IT Act.
• When the revenue has accepted the amount as loan in the hands of other party, it cannot take up a contrary stand and treat the same loan in the hands of the assessee as a gift or a sum received without consideration taxable u/s-56(2)(vii)(a) – ITO Vs. Shri Paramveer Abhay Sancheti (2018 (7) TMI 215 – ITAT Nagpur).

Indirect Tax:

• CBEC has amended the Central Goods and Services Tax Rules, 2017. These rules may be called the Central Goods and Services Tax (Seventh Amendment) Rules, 2018, which shall be deemed to have come into force with effect from the 12th day of June, 2018. Vide notification no 29/2018, dated 6th July 2018.

• GST: CBIT notifies CGST (Seventh Amendment) Rules, 2018 and amended Rules 125, 129, 130, 131, 132 & 133 effective from 12.06.2018 –N.29/2018-CT, dt.06.07.2018.
• Alternate accommodation to be paid to the tenant of the old building by the developer / owner – compensation for alternate accommodation / damages for delayed handover of possession of the new premises – Levy of GST confirmed – AAR, in Zaver Shankarlal Bhanushali (2018 (7) TMI 227).
• CBIC has developed a mobile app ‘GST Verify’ to protect interest of consumers. It is an android app to verify if the person collecting GST from the consumer is eligible to collect it or not. It also provides the details of the person collecting GST.
• Electricity bills can have GST component at times. Non-tariff charges, which include application fee for releasing connection, rentals charged against metering equipment and labour charges for shifting of meters and service lines, are liable to taxed at 18% under the GST.

 

FAQ on GST AUDIT:

• Query: Is a summary assessment order always passed against the taxpayer?
• Answer:No, the order is not always passed against the taxpayer. If the goods are being transported or stored in a warehouse, the taxpayer cannot be held responsible for them. In such cases, the order is passed against the person in charge of the goods at that point, per Section 64 of the CGST/SGST Act.

RBI UPDATES

• RBI has decided to put in place a graded enforcement action framework to enable appropriate action in respect of statutory auditors for any lapses observed in conducting a bank’s statutory audit. The framework would cover, instances of divergence identified in asset classification and provisioning during the RBI inspection vis-à-vis the audited financial statements of banks above the threshold specified etc.

SEBI UPDATES

• SEBI reviewed the mechanism of dividend adjustment for stock options and allowed alteration in strike price. According to the regulator, adjustment in strike price will be carried out in case dividend declared by a company is above 5 per cent of the underlying stocks.

OTHER UPDATES

• IBBIhas notified, the IBBI (IRP for Corporate Persons) (Third Amendment) Reg., 2018.
• DGFThas Notified the office address of DGFT and its Regional Authorities and their Jurisdiction and Private SEZs under the Foreign Trade Policy, 2015-20.

KEY DUE DATES

• GSTR-3B (Jun 2018)-Jul 20th, 2018

• GSTR-5 (Jun 2018)-Jul 20th, 2018

• GSTR-6 (Jul’17 – Jun’18)- Jul 31st, 2018

• GSTR-4 (Apr-Jun, 2018)-Jul 18th, 2018

• GSTR-5A (Jun 2018)-Jul 20th, 2018

• Quarterly return for registered persons with aggregate turnover up to Rs. 1.50 Crores- GSTR-1 (Apr-Jun, 2018)-Jul 31st, 2018
• Turnover exceeding Rs. 1.5 Crores or opted to file monthly Return GSTR-1 (Jun 2018)- Jul 10th, 2018
• more updates for related blogs are;
  • GST Return compliances calendar- Nov 2020
  • SALIENT FEATURES OF NEW GST SYSTEM IN INDIA
  • Key points of 42nd GST council Meeting headed By FM N. Sitharaman
  • GSTN enable auto-populated in the E-invoice information into GST Return -1
  • Delayed in payment of GST then Intt to be paid on net GST liability from Sep 1, 2020.
  • Effect of GST on Advertisement and Cinema Industry
  • GST Impact on Import and Export
  • GST Impact on Real Estate