Corporate and Professional updates on 26th Feb 2019
FAQ’s On GST:
Ques. Are services supplied without consideration to a recipient other than ‘related party’ / ‘distinct person’ taxable?
Ans. Section 7 of the CGST Act, 2017 read with Schedule I thereto provides that services supplied without consideration to related persons or distinct persons only would qualify as ‘supply’.
Also, import of services by bank from a related person or from any of its establishments outside India in the course or furtherance of business will be supply even if imported without consideration. Therefore, where the services are supplied by a supplier without consideration to an unrelated recipient or a person other than a related or distinct person, the same would not amount to supply and not liable to GST.
Ques. Can value of services be enhanced by invoking the CGST Rules in case of services provided by banks at a concessional/differential rate to a recipient other than ‘related party’ / ‘distinct person’?
Ans. Banks provide various services to customers for a charge. However, at times, account holders/customers are provided services free or at a concessional/differential rate.
The free or concessional/differential rate is offered considering factors such as credit rating and stability of the customer, size of relationship, expected future business or the opportunity presented in the market elsewhere etc. As a result, the charges for the same service may differ from customer to customer.
Such services provided to persons who are not related persons will be taxable on the transaction value, that is, the value of the services charged or recovered from the customers or account holders as per section 15 of the CGST Act, 2017.
Thus, in case of services provided at a concessional/differential rate to a recipient other than ‘related party’ / ‘distinct person’, there is no requirement for enhancing the value of services by invoking the CGST Rules, 2017.
Ques. In the case of Banks which are not availing the reversal of ITC at 50%, how should inter-branch services be valued where open market value of services of like kind and quality is not available?
Ans. In such cases, banks can adopt any reasonable basis consistent with Rule 30 and 31 of the CGST Rules, 2017.
Indian GDP:
- In the Third Quarter the GDP growth rate is likely to further decelerate the current financial year, as compared to the first two quarters. Economists with independent agencies have pegged it at 6.7-6.9% against 8.2% for the first quarter and 7.1% for the second. Only EY India pegged it at 7.3-7.4%. The growth rate, along with the second advance estimates for FY19, is set to be released by the Central Statistics Office on Thursday.
- Most economists also projected the entire FY19 GDP growth rate at 7.2%, the same as the first advance estimates. This was despite the fact that 2017-18 GDP growth rate was revised from 6.7% to 7.2%, which could have a dampening impact on the growth numbers for the current financial year. For instance, SBI group Chief Economist Soumya Kanti Ghosh said the new number for 2017-18 would have pulled down GDP growth rate to 5.9% for FY19. However, he said the GDP deflator (a technical name for the inflation rate in the GDP series), which stood at 4.1% in the first advance estimates, could be revised downwards by 50 basis points, pushing the growth rate close to 7.2% for FY19.
Other Updates:
- Britannia to replace HPCL on Nifty50 in stock reshuffle.
- SBI Research pegs Q3 GDP at 6.6-6.7%.
- India lacks good economic, jobs data.
- Adani wins bids to operate 5 AAI airports for 50 years.
- MFI loan book growth hits 43% at Rs 1.66 trn in Q3.
- Regulations against every telco except Jio.
- 2 cr jobs created in 16 months to Dec 2018.
- A/cs of IL&FS and its subsidiaries will not be declared NPA for now: NCLAT.
- GMR wins bid for Andhra’s Greenfield Bhogapuram Int’l Airport Project.
- EID Parry in talks with Indian Oil to start Compressed Biogas production.
- Etihad conditions may delay the debt-laden Jet Airways resolution plan.
- Steel cosset to hike the price for the third time this month.
- New EPF subscribers’ monthly count hits a 16-month low in Dec.
- Rabi sowing closes with record rice acreage of 49 lakh hectares.
- Lupin gets USFDA nod for the anti-inflammatory drug.
- Thomas Cook India buys 51% stake in Digiphoto.
- Shilpa Medicare gets USFDA nod for a cancer drug.
- Bharti Airtel board to meet on 28 February to consider fundraising plans.
- RBI extends KYC compliance norms by six months.
- India’s foreign direct investment inflows fall amid pre-election uncertainty.
- EPFO begins a survey to assess the quantum of funds parked in IL&FS bonds.
- Copper near 8-month high on deferred US tariff hikes.
- Funding, regulatory process haunts life sciences and healthcare startups.
- Proceed against Malvinder, Shivinder for Rs 472 crore fraud.
- Exporters group calls for providing export sops to more products.
- Real estate defaults could trigger the next crisis for struggling Indian NBFCs.
- Sugar production may exceed the demand of 26 MT in SS 18-19.
- Rupee strengthens by 17 paise against the US dollar on easing trade war concerns.
- Insurers too got stuck in securitized debt deals.
- Goods and services exports to cross USD 500 bn this fiscal.
Key Due Dates:
- Due date of TDS Return for the month of January 2019 is 28th February 2019.
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Rajput Jain & AssociatesRajput Jain & Associates is a Chartered Accountants firm, with it's headquarter situated at New Delhi (the capital of India). The firm has been set up by a group of young, enthusiastic, highly skilled and motivated professionals who have taken experience from top consulting firms and are extensively experienced in their chosen fields has providing a wide array of Accounting, Auditing, Taxation, Assurance and Business advisory services to various clients and their stakeholders.
Rajput jain & Associates, a professional firm, offers its clients a full range of services, To serve better and to bring bucket of services under one roof, the firm has merged with it various Chartered Accountancy firms pioneer in diversified fields.
We have associates all over India in big cities. All our offices are well equipped with latest technological support with updated reference materials. We have a large team of professionals other than our Core Team members to meet the requirements of our prospective clients including the existing ones. However, considering our commitment towards high quality services to our clients, our team keeps on growing with more and more associates having strong professional background with good exposure in the related areas of responsibility.