No Income Tax on Eligible Start-Ups on Issuing Share Capital at Excess Premium: Govt* [Read Notification]
Read more at: http://www.taxscan.in/income-tax-start-ups-share-capital-excess-premium-govt/23809/
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*SUPREME COURT OF INDIA : In Mackintosh Burn Ltd. vs. Sarkar & Chowdhury Enterprises (P.) Ltd.*
*_Refusal to register transfer of shares can be permitted on the ground of violation of law or any other sufficient cause and conflict of interest can also be a cause._*
*_Read full case law at :_* https://dasgovernance.com/2018/05/27/supreme-court-of-india-in-mackintosh-burn-ltd-vs-sarkar-chowdhury-enterprises-p-ltd/
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Income Tax Dept cautions Filing of SFT Statement by May 31st*
Read more at: http://www.taxscan.in/income-tax-sft-statement-may-31st/23795/
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All ITR Forms ready for E-Filing: Income Tax Dept*
Read more at: http://www.taxscan.in/itr-forms-e-filing-income-tax-dept/23802/
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📺 *Updates*
▶1. Ind AS 109: Interest free refundable security deposit to be recognised at discounted value
▶2. Exp. incurred to upgrade computer software which brought efficiency in business was revenue in nature
Principal Commissioner of Income-tax v. Holcim Services (South Asia) Ltd.
▶3. Deduction of membership fee of social club not allowable if it wasn't taken for entertaining business clients
L. Jairam Parwani v. Deputy Commissioner of Income-tax, City Circle VI (Inv.), Chennai.
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ICAI issues Valuation Standards as a benchmark for Valuation Practices applicable for Chartered Accountants*
Read more at: http://www.taxscan.in/icai-valuation-standards-chartered-accountants/23776/
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*Supreme Court Justice Indu Malhotra addresses 375th Meeting of ICAI*
Read more at: http://www.taxscan.in/supreme-court-justice-indu-malhotra-meeting-icai/23781/
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CBDT has constituted a Task Force vide Office Order with a mandate of drafting an appropriate direct tax legislation keeping in view the direct tax system prevalent in various countries, the international best practices, the economic needs of the country.
Govt. introduced intra-state e-way bill for two states and five Union Territories (UTs) from 25.5.2018. The remaining states — Chhattisgarh, Goa, J&K, Mizoram, Odisha, Punjab, Tamil Nadu and Delhi — would be brought in the system from June 3 to cover the entire country.
Government is exploring the possibility of creating new categories in its tariff structure that will allow it to impose import duties on hi-tech products without violating a global agreement that mandates nil duties.
Sec. 132 of the CGST Act, issuance of an invoice without supply of goods and wrongful utilization of input tax credit is a cognizable and non-bailable offence if the amount involved is over Rs 5 Cr.
The insolvency ordinance has specified that the Limitation Act 1963 will apply for proceedings before the NCLT and NCLAT.
NSE and MCX entered into merger talks ahead of the implementation of the universal exchange framework in October. The two entities are planning to approach SEBI) as early as this month.
Please submit your Self-declaration Form Online to avail 20 Unstructured CPE Hours for Calendar Year 2017 from the link http://cpeapp.icai.org/member/login. Last Date of submission: 31st May, 2018.
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ICAI Registered Valuers Organsiation launches First Batch of Educational Course*
Read more at: http://www.taxscan.in/icai-registered-valuers-organsiation-educational-course/23774/
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✳Direct Tax:
▶Kolkata ITAT rules that assessee (an Indian BPO company) not liable to deduct TDS u/s. 195 on payment of market support fees to US entities (including assessee's US based wholly owned subsidiary) for securing orders and solicit business from foreign customers during AY 2012-13;
[TS-265-ITAT-2018(Kol)]
▶SC admits Revenue’s SLP challenging Gujarat HC judgment granting Article 8 relief under India-Singapore DTAA to assessee (a Singapore based shipping company);
▶Delhi HC admits cross appeals filed by NDTV & Income tax Department, frames substantial questions of law & lists the matter for hearing in September; HC to decide whether the Tribunal 'erred' in upholding the Rs. 642 cr addition made on NDTV u/s 69A of Income tax Act, with regards to the $150 mn overseas funding raised by the company ;
✳Indirect Tax:
▶CBEC has amend the First Schedule to the Customs Tariff Act, 1975 (51 of 1975). Vide notification no 45 /2018 – Customs, dated 23rd May 2018.
✳Key Date:
▶TDS return for March Quarter by all detectors: 31.05.2018
▶GSTR-1 Monthly return of outwards suppliers for April: 31.05.2018
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*Setback for Chartered Accountants, Only Merchant Bankers can do Valuation of Unquoted Shares: CBDT* [Read Notification]
Read more at: http://www.taxscan.in/chartered-accountants-merchant-bankers-unquoted-shares-cbdt/23806/
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*Setback for Chartered Accountants, Only Merchant Bankers can do Valuation of Unquoted Shares: CBDT*
The Central Board of Direct Taxes (CBDT) has yesterday notified the Income Tax (6th Amendment Rules) wherein it is provided that only Merchant Bankers are entitled to do Valuation of Unquoted Shares and the Chartered Accountants are no more eligible to do so.
Presently, the fair market value of the unlisted equity share is calculated at the option of the company either on the book value on the valuation date or as per discounted free cash flow method calculated by a Merchant Banker or a Chartered Accountant.
The amendment to Rule 11UA has removed a Chartered Accountant from the list of authorized professional who can calculate the fair market value of the shares. Consequently, all valuations of unlisted equity shares on or after May 24, 2018 shall be done only by a Merchant Banker.
This change has been made to bring this provision at par with Rule 3, which allows only Merchant Banker to calculate the value of unlisted shares issued to the employees under the ESOP Schemes.
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Kerala Govt. issues Instructions to Report Date Wise Refund Claimed / Sanctioned in GST by States* [Read Circular]
Read more at: http://www.taxscan.in/kerala-govt-issues-instructions-report-date-wise-refund-claimed-sanctioned-gst-states/23690/
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Frozen Sheep / Goat Carcass Supplied in LDPE & HDPE Bags liable to GST: Maharashtra AAR* [Read Order]
Read more at: http://www.taxscan.in/frozen-sheep-goat-carcass-supplied-ldpe-hdpe-bags-gst-maharashtra-aar/23702/
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Task force rewriting the income-tax laws has been granted three months more till August to submit its report to the government. CBDT set up to draft a law to replace the income Tax Act, which has been in force since 1961, was to submit its report by this month-end.
Due Date for Quarterly statement of TDS deposited for the quarter ending March 31, 2018 is May 31, 2018.
E-way bill for moving goods within a state will become mandatory from June 3, with the country-wide roll out of the mechanism. The government had launched the electronic-way or e-way bill system from April 1 for moving goods worth over Rs 50,000 from one state to another.
If turnover 1.5 cr or more, Last Day to file GSTR-1 for Apr is 31.5.2018 & for May is 10.6.2018. From May, 10 days to file GSTR-1 i.e. before GSTR3B.
Cabinet cleared the IBC Ordinance paving way to a host of changes in the modality of the Insolvency and Bankruptcy Code (IBC). The Ordinance is based on the changes suggested in a report by a 14-member Insolvency Law Committee.
SEBI is planning to ease the norms for mutual funds (MF) participation in the derivative markets. The regulator is considering measuring such as, allowing domestic funds to 'write' options and increasing cap on F&O investments.
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. http://similartrack.transactionalmile.com/paidmilecom/link.php?M=23061444&N=10175&L=132223&F=H
Facts:
1) The assessee previously called as M/s Sky Light Hospitality Pvt Ltd. was presently known as M/s Sky Light Hospitality LLP having converted into LLP from company under Limited Liability Partnership Act, 2008.
2) Assessing Officer (AO) issued reassessment notice in name of company which had ceased to exist and was dissolved. Assessee raised the contention that the notice issued to a dead juristic person was invalid and void in the eyes of law.
3) However, AO didn’t accept the said mistake and held that the notice in the name of erstwhile company was valid as this error was protected and shielded under Section 292B.
4) The assessee failed before all the lower appellate authorities and finally approached the Supreme Court.
The Supreme Court upheld the order of High Court which was as under:
1) Object and purpose behind Section 292-B is to ensure that technical pleas on the ground of mistake, defect or omission should not invalidate the assessment proceedings, when no confusion or prejudice is caused due to non-observance of technical formalities.
2) Notice may be defective or there may be omissions but this would not make the notice a nullity. Validity of a notice has to be examined from the stand point whether in substance or in effect it is in conformity and in accordance with the intent and purpose of the Act.
3) In the instant case, re-assessment notice served on assessee had duly complied with law and was legal in all respects.
4) Therefore, re-assessment notice issued in name of erstwhile company, despite company ceasing to exist as it had been converted into LLP, would not invalidate re-assessment proceedings as same was not a jurisdictional error, but an irregularity and procedural/technical lapse which could be cured under section 292B. [2018] 92 taxmann.com 93 (SC)
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Roll Out of E-Way Bill system for Intra-State Movement of Goods in Maharashtra, Manipur and Union Territories from Tomorrow*
Read more at: http://www.taxscan.in/e-way-bill-system-intra-state-movement-goods-maharashtra-manipur-union-territories-tomorrow/23726/
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*Commissioners Not Allowed to Transfer / Amend Authorizations without Prior Express Approval of the Board: CBIC’s Legal Cell issues Instructions*
Read more at: http://www.taxscan.in/commissioners-transfer-amend-authorizations-express-board-cbics/23715/
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SAC Code & GST Rate for Accounting and Professional Services
GST Council determines the GST rate for all services in India. GST rate for services fall under 0% or 5% or 12% or 18% or 28% slab. GST rate is fixed based on SAC code or services accounting code, a services classification system developed by the service tax department. In this article, we look at the SAC code and GST rate for legal, accounting and professional services in India. Professionals classified as taxable persons under GST must obtain GST registration.
*SAC code for accounting, auditing and bookkeeping services*
SAC Code 998221 – Financial auditing services
SAC Code 998222 – Accounting and bookkeeping services
SAC Code 998223 – Payroll services
SAC Code 998224 – Other similar services
*_GST rate for accounting, auditing and bookkeeping services is 18%_*
*Tax Consultancy and Preparation Services*
SAC code for tax consultancy and preparation are as follows:
SAC Code 998231 – Corporate tax consulting and preparation services
SAC Code 998232 – Individual tax preparation and planning services
*_GST rate for tax consultancy and preparation services is 18%_*
*Insolvency and Receivership Services*
SAC code for insolvency and receivership services are as follows:
SAC Code 998240 – Insolvency and receivership services
*_GST rate for insolvency and receivership services is 18%_*.
*Other Professional, Technical and Business Services*
SAC code for other professional, technical and business services are as follows:
SAC Code 998391 – Specialty design services including interior design, fashion design, industrial design and other specialty design services
SAC Code 998392 – Design originals
SAC Code 998393 – Scientific and technical consulting services
SAC Code 998394 – Original compilations of facts/information
SAC Code 998395 – Translation and interpretation services
SAC Code 998396 – Trademarks and franchises
SAC Code 998397 – Sponsorship Services & Brand Promotion Services
SAC Code 998399 – Other professional, technical and business services
*_18% GST rate is applicable for other professional, technical and business services_*.
*Legal Services*
SAC Code for legal services are as follows:
SAC Code 998211 – Legal advisory and representation services concerning criminal law.
SAC Code 998212 – Legal advisory and representation services concerning other fields of law.
SAC Code 998213 – Legal documentation and certification services concerning patents, copyrights and other intellectual property rights.
SAC Code 998214 – Legal documentation and certification services concerning other documents.
SAC Code 998215 – Arbitration and conciliation services
SAC Code 998216 – Other legal services
*Legal services provided by an Advocate or Firm of Advocates or an Arbitral Tribunal to any person other than a business entity or a business entity with a turnover of up to Rs.20 lakhs (Rs. 10 lakhs in special category states) is exempt from GST*.
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India's direct tax collection in 2017/18 stood at Rs 10.03 trillion, up 18 percent
on year, the finance ministry said.
CBDT has directed the I-T Department to form a special team of officers to complete the task of filing these Appeals under Section 252(1) of the Companies Act, 2013 in various NCLT benches across the country by this month-end.
31.05.18 is last date to file GSTR-6, Furnish of Return by Input Service Distributor for the months from July 2017 to Apr 2018.
Union Cabinet approved, via an Ordinance, amendments to the Insolvency and Bankruptcy Code (IBC), giving homebuyers the status of creditors in the insolvency process.
The government has proposed rates for over 1,350 treatment packages ranging from Rs 1,000 to over Rs 1.50 lakh, for the Pradhan Mantri Rashtriya Swasthya Suraksha Mission.The government issued a 205-page model tender document.
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*Rajasthan Govt. empowers Add’l & Joint Commissioners to Extend Time Limit to Conclude Inspection Proceedings under Rajasthan GST* [Read Order]
Read more at: http://www.taxscan.in/rajasthan-govt-empowers-addl-joint-commissioners-extend-time-limit-inspection-gst/23720/
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*Amount Paid as Retrenchment Compensation is allowable Deduction u/s 37 of Income Tax Act: ITAT* [Read Order]
Read more at: http://www.taxscan.in/amount-retrenchment-compensation-deduction-income-tax-act-itat/23737/
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*Issuance of an Allotment Letter from a Builder / Developer not sufficient to Claim Sec 50 Benefit: ITAT* [Read Order]
Read more at: http://www.taxscan.in/issuance-allotment-letter-builder-developer-sufficient-claim-sec-50-benefit-itat/23731/
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Sec 80IA (4) Deduction allowable to Widening of Existing Roads by Construction of Additional Lanes of a Highway: ITAT* [Read Order]
Read more at: http://www.taxscan.in/deduction-allowable-widening-existing-roads-construction-additional-lanes-highway-itat/23744/
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👉🏻CBDT chairman among top I-T officials under CBI lens in Nirav Modi case*
(The Nirav Modi case is becoming a sticky wicket for many investigators. Chairman CBDT have come under the CBI lens for the alleged misreporting and sharing of investigation details with extortionists)
👇🏻 👇🏻 👇🏻
https://goo.gl/c6wRwL
*👉🏻FinMin ties up with e-commerce firms to give loans under PMMY*
( PMMY is a flagship scheme of the government to provide loans of up to Rs 10 lakh to small entrepreneurs. The loans are being given by banks, small finance banks, non-banking financial companies (NBFCs) and micro finance institutions)
👇🏻 👇🏻 👇🏻
https://goo.gl/j45KfL
*👉🏻Audit Provision as per CGST Act, 2017*
(Every registered person whose T.O. during a F.Y. exceeds the prescribed limit shall get his accounts audited by a CA or a CMA and shall submit a copy of the audited annual accounts, the reconciliation statement , reconciling the value of supplies declared)
👇🏻 👇🏻 👇🏻
https://goo.gl/EPEc89
*👉🏻Faculties Required For Online Classes*
(We are planning to start FREE / Concessional online classes for CA CS / CMA Students. We need Faculties (all subjects) for CA /CS / CMA Foundation / IPC / Final classes. If interested please send ur your cv at)
👇🏻 👇🏻 👇🏻
https://goo.gl/A8if4a
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*Experience During CS Management Training & Practice as a Sole Proprietor Do Not Qualify as Experience in Management under IP Regulations: IBBI denies IP Registration* [Read Order]
Read more at: http://www.taxscan.in/experience-cs-management-training-practice-sole-proprietor-experience-management-ip-regulations-ibbi/23757/
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What to do when you receive a notice from the tax department
Most of us manage to get through our days without ever having to c with the Income-Tax Department. Sometimes the small business that you are running may not be that lucky. So what do you do when the long arm of the tax department reaches out and hands you a notice?
Our advice - do not panic and do not ignore it. Find out exactly why the notice was sent to you and then carefully handle it or else you may end up paying a hefty penalty in addition to your tax payments.
Remember, receiving a notice does not mean you have committed a crime. Often notices are sent for relatively innocuous reasons like a minor error in filing a tax return or an enquiry for basic information. In such cases, submitting the requested information is enough. If the reason is not so innocuous, and the notice demands a scrutiny assessment, this means you will need to prepare yourself for a more detailed examination.
Five things to do when you receive a notice
1. Record the date and time of receipt of notice - Ensure that you record the time and date of receipt of the notice either on the notice itself or somewhere else so that later on you are able to defend yourself and substantiate that you replied to the notice on time. This is important because the time limit by which the reply needs to be filed is mentioned on the notice and usually starts from the date of service of the notice. Also preserve the envelope in which the notice was dispatched and using the speed post number on it, keep a tracking status of the same, for future reference.
2. Check to whom it was issued - Was the notice meant for you or for someone with a similar name? The Tax authority issues notices based on your PAN followed by name and address. Whenever you receive a notice, check all the details of whom it has been issued, PAN, name, address, etc.
3. Check the validity and details of the Issuer - Check the validity of the notice, there are certain notices which can be issued within prescribed time or else they lose their validity. So, check the relevant section under which notice has been issued and check the time limit of the same. Also ensure that it is a genuine notice by checking details of the issuer, whether it is stamped and signed or digitally signed, the designation, office address etc.
4. Identify the reason behind issuance of notice - It is good practice to identify the reason behind the issuance of the notice before submitting any response. It could be a minor error or a major issue. Based on the reasons identified, you can plan your next steps and decide on what and how to file your response before the tax authority.
5. Submit your response on time - Now that you have identified why you received the notice and have understood exactly what needs to be submitted, you need to examine the information and submit it on time before the tax authority. In case you are not able to gather all information requested by the tax authority, ask for additional time and file a request letter seeking more time to submit the same with an appropriate reason. Please note that non-appearance or not furnishing information on time may result in penal consequences.
Things to keep in mind when responding to a notice
1. How and where to respond - With the move towards increased digitization and e-assessments, you could be receiving notices over email instead of speed post. Today many notices are to be responded online via your income tax e-portal. Hence, it is important to keep in mind how and where to respond against the notice received by you. Once you have identified who has issued the notice, please ensure that reply is submitted to the correct authority. For example, if you submitted your reply before your jurisdictional tax officer instead of the CPC, that would be treated as if no response had been filed.
2. Who can respond - In case of individuals, they have to respond by themselves but in case of Company or any other legal entity, the authorized person is required to respond. Alternatively, response may also be made through a tax expert on your behalf by authorizing him vide a valid Power of Attorney (POA).
3. Prepare two sets of documents - In case of a complex issue, please seek the advice of a tax expert when preparing your response. However, if it is not a complex issue, ensure that you prepare two sets of documents to be submitted before the tax officer along with a covering letter listing out the documents you are submitting. Keep one set for your own records.
4. Take acknowledgement and trail of events - Get a stamp / acknowledgement on your copy for your records as a proof that you have submitted your documentation. In case the documents are to be submitted online through the e-portal, make sure that you take a screenshot of the acknowledgement message that appears on your screen when you have submitted your reply or else records for online responses are also available on your e-portal.
All in all, a tax notice is uncomfortable but in most cases manageable and is certainly not a reason to panic.
The writer is Manager (Taxation) with Corporate Catalyst India ( www.cci.in )
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
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Loan Waiver Benefit consequent to One-Time Benefit is Capital in Nature: ITAT* [Read Order]
Read more at: http://www.taxscan.in/loan-waiver-benefit-consequent-one-time-benefit-capital-nature-itat/23750/
