Corporate and professional Updates on 20th February 2019

Direct Tax Updates:

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  • The government announced a series of changes aimed at freeing investors and entrepreneurs from the so-called angel tax that’s roiled India’s startup ecosystem. It raised the exemption threshold and kept investments by listed companies of certain minimum size, venture capital funds and non-residents in startups outside the ambit of the tax.
  • A notification issued by the government also widened the definition of startups to benefit a larger number of innovators and protect them from the tax. An entity that has been in operation for up to 10 years from its date of incorporation or registration will be considered a startup instead of the current seven years.

Excluded Investors:

  • The investment limit was raised to Rs 25 crore from Rs10 crore now for availing of tax exemption. “Considerations of shares received by eligible startups for shares issued or proposed to be issued by all investors shall be exempt up to an aggregate limit of Rs 25 crore.
  • The Rs 25 crore limit will exclude funds from certain sources. These include non-residents, Category 1 registered alternative investment funds and frequently-traded listed companies with a net worth of Rs 100 crore or turnover of at least Rs 250 crore. The development comes in the wake of startups having been served demands for taxes on angel funds received by them.

Tax Scrutiny:

  • The new norms don’t address cases in which tax demands have already been raised. “In cases where demand notices have been raised, we have directed the tax officers to not enforce recovery of demand.
  • The increase in investment limit to Rs 25 crore and self-declaration procedure with DPIIT are game changers for the startup fraternity.

Indirect Tax Updates:

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  • Compulsory mentioning of the Place of Supply in case of Interstate supply to Unregistered Person.
  • CBIC mandates the reporting of all inter-State supplies made to unregistered persons in Table 3.2 of FORM GSTR-3B and Table 7B of FORM GSTR-1.
  • The Central Board of Indirect Taxes & Customs in its Circular No. 89/08/2019-GST dated February 18, 2019 it shows that the registered persons making inter-State supplies to unregistered persons, composition taxable persons and UIN holders shall report the details of such supplies along with the place of supply of FORM GSTR-3B and the details of all inter-State supplies made to unregistered persons where the invoice value is up to Rs 2.5 lakhs are required to be reported in Table 7B of FORM GSTR-1 as mandated by the law.
  • Contravention of any of the provisions of the Act or the rules made there under attracts penal action under the provisions of section 125 of the CGST Act.

Other Updates:

  • RBI May launch exchange traded fund of PSU bank stocks next fiscal.
  • I-T for charging GST on logo use by subsidiaries.
  • Yes Bank denies any wrong-doing in making report public.
  • National electronics policy eyes 1 cr jobs.
  • Arcelor Mittal buys back shares worth $89 million.
  • Walmart Q4 profits jump 69.5% to $3.7 bn, top estimates.
  • Irdai asks all non-life insurers for a uniform standard health product.
  • WTO pegs global trade at 9-yr low; India exports may face repercussions.
  • Govt raises investment limit for angel tax concession to startups.
  • SIP closure ratio at 18-month high, Dec applications slip to 750,000.
  • Honda to close only UK factory, blames global trends.
  • Reliance Power promoter’s eye 2,500 cr from sale of 18% stake.
  • Vedanta says no revised bid for Essar Steel.
  • I-T dept raids Divi’s Lab premises.
  • Wheat output may cross 100 mt.
  • SEA in pact with Argentinian body to boost vegoil trade.
  • ABB bags 270 cr. orders from Railways.
  • reverts back to old system of awarding oil and gas blocks.
  • Cabinet clears promulgating fresh ordinance for company’s law amendments.
  • SC to pronounce order on Ericsson’s contempt plea against RCom chief Anil Ambani.
  • Jaypee Infra’s promoter makes second attempt to settle dues.
  • Bad loans: 19 PSBs write off nearly Rs 41,000 crore in Q3.
  • Insolvency process: Gaur offers to clear Jaypee Infra dues of Rs 8,358 crore.
  • Vedanta to file fresh writ in High Court Sterlite Copper row.
  • French aerospace firm Safran to have engine plant in Hyderabad.
  • JSW Cement to invest Rs 2,000cr to take capacity to 20mt by’20.
  • Sensex falls for 9th straight session, ends 146 points lower.
  • India’s fuel demand rose 6.4 per cent year-on-year in January.
  • Brent oil eases from 2019 highs as markets await trade talk’s outcome.
  • No PAN is required for transfer of equity shares of listed entities executed by non-residents to their Immediate Relatives.
  • Now INDIAN COMPANIES who are in CIRP process can use ECB to repay their rupee term Loan.

Key Due Dates:

  • Due dates of GSTR-3B (summary return of January) for the month of January 2019 is 20th February 2019.

Quote of the day:

“A professional is someone who can do his best work when he doesn’t feel like it.”

Disclaimer:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Before making any decision do consult your professional /tax advisor for their misrepresentation or interpretation of act or rules author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. The author is a Chartered Accountant and the Chief Gardener & Founder Director of Rajput Jain & Associate, a leading Tax & Investment planning Advisor Service provider. His Blog can be found at http://carajput.com for any query you can write to info@carajput.com. Hope the information will assist you in your professional endeavors. For query or help contact: info@carajput.com  or call at 09811322785/4- 9555555480.