# CBDT vide Circular No. 02/2019 dt. 04 January 2019 made withdrawal of circular no. 10/2018 dt. 31-12-2018 on applicability of Section 56(2)(viia) for issue of shares by a company in which public are not substantially interested.
# CGST (Amendment) Act, 2018- Clarification on Transitional Credit
Circular No. 87/06/2019-GST - (02/01/2019)
# ICAI : Pl update/validate ur registered mobile no. & email id for using online members services in new platform. Visit, ICAI.Org, e-Services.
# ICAI : 3 days Hands on Experience Training on Forensic Analytics using CAAT Tools at Noida from 11-13 January, 2019.
https://resource.cdn.icai.org/53165daab141218.pdf
# NICASA: Register for CA Students Festival 11/01/19 at 4PM onwards, Shah Audtorium Kashmere Gate, Delhi.
Reg. at www.nirc-icai.org/seminars - FEE: Rs.200/-
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NCLT (Mumbai Bench) : In Re. Gupta Global Resources Pvt. Ltd.
Resolution Professional cannot question decision of Committee of Creditors.
Read full case law at : https://dasgovernance.com/2019/01/07/nclt-mumbai-bench-in-re-gupta-global-resources-pvt-ltd/
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Work Contract Under GST
Some of the Key Point For Work Contract Under GST-
1. “Works Contract” means a contract for building, construction, fabrication, completion, erection, installation, fitting out, improvement, modification, repair, maintenance, renovation, alteration or commissioning of any immovable property wherein transfer of property in goods (whether as goods or in some other form) is involved in the execution of such contract.” So It Is Very Important To Not The Word Of Any Immovable Property
2. As per Para 6 (a) of Schedule II to the CGST Act, 2017, works contracts as defined in section 2(119) of the CGST Act, 2017 shall be treated as a supply of services.
3. As per section 17(5) (c) of the CGST Act, 2017, Input tax credit shall not be available in respect of the works contract services when supplied for construction of an immovable property (other than plant and machinery) except where it is an input service for further supply of works contract service. Thus, ITC for works contract can be availed only by one who is in the same line of business and is using such services received for further supply of works contract service. For example a building developer may engage services of a sub- contractor for certain portion of the whole work. The sub- contractor will charge GST in the tax invoice raised on the main contractor. The main contractor will be entitled to take ITC on the tax invoice raised by his sub-contractor as his output is works contract service. However if the main contractor provides works contract service (other than for plant and machinery) to a company say in the IT business, the ITC of GST paid on the invoice raised by the works contractor will not be available to the IT Company.
4. Plant and Machinery in certain cases when affixed permanently to the earth would constitute immovable property. When a works contract is for the construction of plant and machinery, the ITC of the tax paid to the works contractor would be available to the recipient, whatever is the business of the recipient. This is because works contract in respect of plant and machinery comes within the exclusion clause of the negative list and ITC would be available when used in the course or furtherance of business.
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Enforceability of Section 153A/ Section 153C –An Analysis
Section 153 A of the Income-tax Act, 1961 provides for the scheme of assessment of income in case of a searched person. In terms of the said section, the Assessing Officer can frame assessment of a searched person for six assessment years immediately preceding the year of search. One of such facet is whether while framing assessment under the said section, the addition/disallowance, if any, with respect to the assessment year for which the proceedings does not abate (means there has either been assessment done earlier or the time period for making such an assessment has elapsed), should be restricted only qua the ‘incriminating’ materials found during the course of search proceedings. Till today, the majority of the judicial precedents, discussed infra, indicates that the Assessing Officer, while framing assessment under section 153A of the Act cannot make the addition/disallowance dehors any ‘incriminating’ material.
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👉If the assessee is a builder but is not engaged in the business of letting of property, then rental income from unsold flats held as stock in trade is assessable to tax under the head ‘income from house property. Bombay High Court - CIT-24 v/s. Gundecha Builders
👉Disciplinary Committee of ICSI finds a Company Secretary guilty for professional misconduct since he suppressed the details of his enrollment as Advocate with the Bar Council of Punjab & Haryana.
👉GST Ministerial Panel approves levy of 1 per cent 'calamity cess' by Kerala for a period of two years to fund rehabilitation work in the state hit by floods.
👉Taxman on a refunds spree as income tax returns hit record high in FY19 & has issued refunds to 24 million taxpayers in December & in terms of value Rs 1.31 lakh crore has been paid out in refunds so far.
👉Nepal Rastra Bank (NRB), the country’s central monetary authority, writes a letter to the RBI, asking it to make Indian bank bills of Rs 200, Rs 500 and Rs 2,000 legal tender in Nepal.
👉Central Government approves the new initiative, i.e., GST Account Assistant Scheme in partnership with the Institute of Chartered Accountants of India (ICAI).
👉NCLT allows the removal of the statutory auditor of a company following a plea by the Corporate Affairs Ministry. The case pertains to Mumbai-based Zen Shaving Ltd & its auditor Mukesh Maneklal Choksi.
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👉🏻MCA to collect KYC details of Companies, CA, CS & CMAs
(In efforts to weed out unscrupulous elements, the Corporate Affairs Ministry plans to collect KYC details of companies, chartered accountants, cost accountants and company secretaries)
👇🏻 👇🏻 👇🏻
https://goo.gl/jk4YTQ
👉🏻Banking services may be hit as bank unions call for strike on January 8-9
(Banking services are likely to be affected on January 8-9 as a section of PSU bank employees would go on a two-day strike in support of the nation-wide strike call given by 10 central trade unions)
👇🏻 👇🏻 👇🏻
https://goo.gl/T61HQo
👉🏻Income Tax Deptt withdraws circular on transfer of shares for No or Inadequate Consideration
(The Income Tax Department has withdrawn a four-day old circular relating to transfer of shares for “no or inadequate consideration”, saying the matter is sub-judice)
👇🏻 👇🏻 👇🏻
https://goo.gl/3F6mCy
👉🏻NCLT removes Auditor for the first time under new Companies Act
(NCLT has removed the statutory auditor of Zen Shaving and allowed MCA to appoint an independent director in his place. This is the first time the NCLT has passed such an order against an Auditor under the Companies Act, 2013)
👇🏻 👇🏻 👇🏻
https://goo.gl/QmE3ug
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# ICAI: The RESULT of CA FINAL and IPCC Exams held in Nov 2018 is expected on 22 JAN 2019 and 4 FEB 2019 respectively.
# ICAI commences E-learning on GST Law incl. Annual Return & GST Audit and E-Learning on UAE VAT. Link at http://idtc.icai.org/e-learning.html
# ICAI today issued two Exposure Drafts (ED), the comments to be received by 4.02.2019 - 1. ED of AS 11 - Construction Contracts and 2. ED of AS-18, Revenue.
# CBDT withdraws C.N.10/2018, dt.31.12.18 on applicability of S-56(2)(viia) of the IT Act, 1961 for issue of shares by a Co. in which public are not substantially interested.
# GST: Benefit of concessional rate of tax under CST Act, 1956 - Inter-state procurement of goods - Benefit is available even in GST regime – G. K. Granites Ltd Vs State of Kerala (2019 (1) TMI 165 - Kerala HC).
# IT: Deduction u/s. 35D - eligibility - Share Issue Expenditure - Once the assessee is claiming that there was an expansion of industrial undertaking, onus lies on the assessee to prove such claim - Schwing Stetter (India) Pvt. Ltd. Vs DCIT (2019 (1) TMI 216 - ITAT Chennai).
# IT: Addition on the basis of cheques found during survey u/s 133A - Since the validity period of six months from the date of issuance of cheques has already been expired, no addition can be made - Kachrulal Nathamal Mutha Vs DCIT (2019 (1) TMI 196 - ITAT Pune).
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GST Gyan -Format of Letter for Appointment of GST Auditor
Suggested format for Appointment Letter.
To
ABC and Co.,
Chartered Accountants
<<<<<Address>>>>>
Dear Sirs,
Sub: Appointment of GST Auditors (Joint Auditors) under section 35(5) and section 44(2) of the CGST Act read with Rule 80(3) of the CGST Rules [read with the corresponding provisions of the State / Union Territory Goods and Services Tax Acts] for the previous year ending on 31st March 2018.
We are pleased to inform you that vide Resolution of the Board of Directors dated ….. you / your firm have / has been appointed GST Auditors / Joint GST Auditors of our Firm / Company (other entities viz., Trust), carrying the business under the name and style as (Name of the client and address and GSTIN) for conducting the audit under section 35(5) and section 44(2) of the CGST Act read with Rule 80(3) of the CGST Rules [read with the corresponding provisions of the State / Union Territory Goods and Services Tax Acts] for the previous year ending on 31st March 2018
The remuneration for conducting the said audit is fixed at Rs…………. All applicable taxes, out of pocket expenses such as travelling, conveyance etc., shall be extra, at actuals.
Kindly confirm your acceptance for the above appointment.
For ……………………
Authorised Signatory
[Name and designation]
Source -Guidance Note Issued by Institute of Chartered Accountants of India
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IT: Where reassessment order was passed against assessee making addition to assessee's income in respect of unexplained investments, and as a consequence thereof, there resulted a liability for payment of advance tax as per relevant provisions, since such advance tax was not paid by assessee, interest as per section 234B(3) had to be mandatorily levied upon assessee
■■■
[2018] 100 taxmann.com 417 (Chandigarh - Trib.)
IN THE ITAT CHANDIGARH BENCH 'B'
Satish Katoch
v.
Income-tax Officer, Palampur
SANJAY GARG, JUDICIAL MEMBER
AND SMT.ANNAPURNA GUPTA, ACCOUNTANT MEMBER
IT APPEAL NO. 298 (CHD) OF 2017
[ASSESSMENT YEAR 2000-01]
NOVEMBER 26, 2018
Section 234B, read with sections 69 and 148, of the Income-tax Act, 1961 - Interest, chargeable as - Assessment year 2000-01 - Whether payment of interest under section 234B is mandatory once default occurs - Held, yes - Assessee had filed its return of income which was processed under section 143(1) - Later on, assessment was reopened under section 147/148 and reassessment order was passed making addition to income of assessee on account of unexplained investment - As a consequence thereof, there resulted a liability for payment of advance tax, which having not been paid, Assessing Officer levied interest under section 234B upon assessee - Whether since on account of reassessment order, assessee had undisputedly became liable to pay advance tax as per relevant provisions which was not paid by assessee, interest under section 234B had to be mandatorily levied upon assessee - Held, yes. [Para 14 and 15] [In favour of revenue]
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Study of Examination Answer Books Re-valuation System: MHRD asks ICAI to enclose a list of Central Universities
Read more at: http://www.taxscan.in/examination-re-valuation-mhrd-icai/32325/
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Court cannot direct State to amend Tax Laws for giving Deductions: Supreme Court [Read Judgment]
Read more at: http://www.taxscan.in/state-amend-tax-laws-deductions-supreme-court/32328/
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👉Parliament's Standing Committee on Finance pulls up RBI and asks it to review the Capital Adequacy Norms for Banking Sector
👉CBDT issues circular on TDS Deductions from salaries for FY 2018-19 (Assessment Year 2019-20), including explanations on many other related issues/ provisions under the Income Tax Act/ Rules.
👉Department of Industrial Policy and Promotion (DIPP) clarifies that the FDI rules pertaining to E-Commerce have not allowed Foreign Investment in the Inventory-Based Model or Multi-Brand Retailing
👉SEBI allows Custodial Services in the Commodity Derivatives Market which would enable participation of Institutional Investors, including Mutual Funds, in the segment
👉SEBI comes out with rules for Merger of Foreign Portfolio Investment (FPI) and Non-Resident Indian/Overseas Citizens of India Routes to bring in a Single Regime for Foreign Investors and regulate NRI and person of Indian Origin fund inflows
👉SEBI exempts Housing Finance Companies(HFCs) and systemically important NBFCs from disclosure of increase or decrease in shareholding due to encumbrance or release of encumbered shares. A similar exemption is already available to scheduled commercial banks and public financial institutions.
👉NHAI plans to raise Rs 10,000 Crore through Bharatmala Taxable Bonds in the ongoing financial year. The Government has approved raising of Rs 62,000 Crore by National Highways Authority of India (NHAI) in 2018-19
👉Union Bank of India plans to raise up to Rs 600 crore through "Employee Share Purchase Scheme", subject to shareholders' approval.
👉HDFC Mutual Fund surpasses ICICI Prudential MF to become the Country's Largest Asset Management Company after a gap of over two years. As of December-end, HDFC MF manages assets to the tune of Rs 3.35 Lakh Crore, while those of ICICI Prudential MF stood at Rs 3.08 Lakh Crore
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GST Council Meeting to be held on 10th January 2019 in New Delhi
Read more at: http://www.taxscan.in/gst-council-meeting-january-2019/32334/
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Sale of Spiritual Products by Charitable Trusts attract GST: AAAR [Read Order]
Read more at: http://www.taxscan.in/sale-spiritual-products-trusts-gst-aaar/32337/
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# CPE Hours: Pls. Claim 20 Unstructured CPE Hours for the calendar year 2018:
• URL: www.cpeicai.org
• Login with your ID (6 Digit Membership Number) & Password (cpe+membership number)
• After login click on SUBMIT ULA Online
• Fill the details and SUBMIT it.
# ICAI Election 2018: The Govt. notifies and publishes the list of the Elected Members for the 24th Council and 23rd Regional Councils in the Gazette of India.
# ICAI: The IAS Board proposes to amend IAS 37 Provisions, Contingent Liabilities and Contingent Assets. The amendments specify the costs an entity includes in determining the ‘cost of fulfilling’ a contract for the purpose of assessing whether a contract is onerous.
# GST: CBIC clarifies that the CENVAT credit of Service Tax paid U/s 66B of the Finance Act, 1994 was available as transitional credit U/s 140(1) of the CGST Act and that legal position has not changed due to amendment of section 140(1) through the CGST (Amendment) Act, 2018 (No. 31 of 2018) – C.N. 87/06/2019-GST, dt.02.01.19.
# IT: Addition u/s 69A - biana (advance) against sale of his residential house - nothing to justify the assessee’s explanation of the cash with him as on account of an advance against sale of his residential house – Geeta Gopal Vs ITO (2019 (1) TMI 89 - ITAT Amritsar).
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CBDT issues Circular on TDS from Salaries [Read Circular]
Read more at: http://www.taxscan.in/cbdt-circular-tds-salaries/32354/
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ICAI sends Notice to Medias for Publishing Defamatory Cartoon and Article against Chartered Accountants
Read more at: http://www.taxscan.in/icai-publishing-defamatory-chartered-accountants/32331/
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A. Due dates for Compliances under GST
10-01-2019- GSTR 8 for E-Commerce operators
11-01-2019- GSTR -1 for the month of December 2018 for taxpayers with Annual Aggregate turnover More than 1.50 Crore
13-01-2019- GSTR-6 for Input Service Distributor
18-01-2019- GSTR-4, Quarterly return for composition dealer
20-01-2019- GSTR-3B for the m/o December 2018
31-01-2019- GSTR -1 for the Quarter ending December 2018 for taxpayers with Annual Aggregate turnover upto 1.50 Crore
31-01-2019- GSTR 7 i.e GST TDS return for govt or PSU for the month of Oct., Nov., Dec 2018
B. Due dates for Compliance under Income tax
07-01-2019 - Deposit of TDS/TCS for m/o Dec 2018
14-01-2019- Issue of TDS Certificate for tax deducted under section 194-IA, 194-IB in the month of November 2018
15-01-2019 -Quarterly statement of TCS deposited for the quarter ending December, 2018
30-01-2019 – Furnishing of challan-cum-statement in respect of tax deducted under Section 194-IA, 194-IB in m/o December 2018
30-01-2019 -Quarterly TCS certificate in respect of tax collected for the quarter ending December 2018
31-01-2019– Quarterly Return for TDS deducted for Quarter ending December 2018
C. Due dates for Compliances under ESI, PF Acts
15-01-2019- ESI/PF Payment for m/o December 2018
25-01-2019- EPF return filing for the month of December 2018
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HC treated gains for shares as short term in absence of repeated sale and purchase
IT : Where AO took a view that profit arising from sale of shares was taxable as business income, in view of fact that there were no instances of repetitive purchase and sale of shares and, moreover, assessee had used its own funds in order to purchase shares, impugned order was to be set aside and assessee's claim that amount in question was liable to tax as short term capital gain, was to be allowed
IT : Where assessee, engaged in business of providing consultancy services in private placement of shares with Foreign Institutional Investors, claimed deduction of foreign travel expenses incurred on its representatives, in view of fact that expenditure was for expansion of existing business and not for setting up a new business, assessee's claim deserved to be allowed
■■■
[2018] 100 taxmann.com 411 (Bombay)
HIGH COURT OF BOMBAY
Principal Commissioner of Income-tax-12
v.
Business Match Services (I) (P.) Ltd.
NOVEMBER 27, 2018
I. Section 45, read with section 28(i) of the Income-tax Act, 1961 - Capital gains - Chargeable as (Business income vs Capital gains : Dealing in shares) - During relevant year, assessee sold shares of 'A' Ltd. - Assessee claimed that profit arising from sale of shares was taxable as short term capital gain - Assessing Officer, however, opined that income in question was liable to tax as business income - Tribunal noted that assessee had purchased shares in instalments and after holding them for sometime, sold them also in instalments - Thus, there were no instances of repetitive purchase and sale of shares - It was also noticed that assessee had used its own funds in order to purchase shares - Moreover, assessee had taken physical delivery of shares and in books of account, treated same as an investment - Tribunal thus concluded that profit earned from sale of shares was taxable as short term capital gain - Whether since Tribunal had applied correct parameters to admitted facts emerging from record, impugned order did not require any interference - Held, yes [Paras 3 and 4] [In favour of assessee]
II. Section 37(1) of the Income-tax Act, 1961 - Business expenditure - Allowability of (Foreign travel expenses) - Assessee was engaged in business of providing consultancy services in private placement of shares with Foreign Institutional Investors, financial institutes and was also providing advice on strategic investments and insurance sector - Assessee claimed deduction of foreign travel expenses incurred on its representatives for expansion of existing business activities - Assessing Officer rejected assessee's claim - Tribunal taking a view that expenditure was for expansion of existing business and not for setting up a new business, allowed assessee's claim - Whether finding recorded by Tribunal being a finding of fact, no substantial question of law arose therefrom - Held, yes [Para 5] [In favour of assessee]
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SC : Urges Govt. to relook at Sec. 80DD conditions regarding insurance payment for handicapped-dependents
SC urges Government to relook into the provision contained in Sec. 80DD of the Income-tax Act and explore the possibility of making suitable amendments taking into consideration various aspects/situations whereby the benefit under LIC’s Jeevan Aadhar policy [in terms of payment of annuity or lump sum] may be allowed to the handicapped persons even during the lifetime of their parents/guardians; Petitioner-individual had filed a Public Interest Litigation (PIL) in the interest of handicapped children whose parents have taken LIC’s Jeevan Aadhar Policy (the premium payments of which qualifies for Sec. 80DD benefit); Referring to the maturity claim clause in the policy [which provides that no benefit can be paid to the dependant till the parent/guardian/life assured survives], SC acknowledges petitioner’s grievance that even when the entire premium is paid under the policy, it does not have maturity claim and the amount would not be given when needed for the benefit of handicapped persons, only because the parent/guardian is still alive; However, SC highlights that the purpose of the policy is to secure the future of the persons suffering from disability, after the death of the parent/guardian and accordingly the Legislature has provided for the condition mentioned in Sec. 80DD(2); SC clarifies that “This Court cannot give a direction to the Parliament to amend or make a statutory provision in a specified manner.,… it is for the Legislature to take care of these aspects and to provide suitable provision by making necessary amendments in Section 80DD of the Act.”; Further on petitioner’s argument of discrimination, SC states that “the main provision is based on reasonable classification, which has a valid rational behind it and there is a specific objective sought to be achieved thereby.”; However, SC highlights situations where handicapped persons may need the payment on annuity or lumpsum basis even during the lifetime of their parents/guardians, directs Govt. to look for other such situations and accordingly consider amending the provision suitably.
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👉🏻Lok Sabha passes Companies (Amendment) Bill
(Lok Sabha passed the Companies( Amendment) Bill, 2018 that seeks to improve ease of doing business, declog the NCLT and prescribe strong action against non-compliant companies)
👇🏻 👇🏻 👇🏻
https://goo.gl/ahX8Xc
👉🏻ICAI reports slams statutory auditors of IL&FS
(Over the past five years, the accounts of IL&FS and its two subsidiaries, IL&FS Financial Services and IL&FS Transportation Networks Limited (ITNL), have been audited by Deloitte Haskins & Sells, EY affiliate SRBC & Co, and KPMG affiliates BSR & Associates.)
👇🏻 👇🏻 👇🏻
https://goo.gl/6R2hkd
👉🏻Appointment of Internal Auditors for KIOCL Ltd
(Appointment of Internal Auditors for KIOCL Ltd for FY 2019-20)
👇🏻 👇🏻 👇🏻
https://goo.gl/rmxYQF
👉🏻Appointment of VAT /CST & GST Auditors for CCIL
(Notice inviting tender for appointment of VAT /CST & GST Auditors for the FY 2017-18)
👇🏻 👇🏻 👇🏻
https://goo.gl/u98wxx
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# ICAI opens registration for First Exclusive Weekend Batches of 120 Hours German Language for ICAI Members and Students at Delhi, starting 19th JAN 19.
# GST: CBIC issued Guidelines for processing of applications for financial assistance under Central Sector Scheme 'Seva Bhoj Yojna' of the Ministry of Culture – C.N.75/49/2018-GST, dt.27.12.18.
# IT: Transfer Pricing Adjustment - credit period beyond 90 days - the transactions with the non-AE constitute valid Internal CUP inputs and ALP adjustment on account of realisation of bills beyond 90 days from the Associated Enterprise cannot be justified – Sophos Technologies Pvt. Ltd. Vs DCIT (2018 (12) TMI 1556 - ITAT Ahmd).
# IT: Reopening of assessment - limitation of four years - Unlike S-153, S-149 has no statutory exception to exclude the time during which the Court stayed the proceedings - IBS Software Pvt. Ltd. Vs Union of India, ACITs (2019 (1) TMI 156 - Kerala HC).
# IT: LTCG - Entitlement for benefit u/s 54F - If one has invested the amount received on sale of capital asset either in purchasing a residential house or in construction of a residential house, even though the transactions are not complete in all respects, the assessee would be entitled for exemption – Pr.CIT Vs Mrs.Vanaja Matthen (2019 (1) TMI 154 - Karnataka HC).
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👉Minister of State for Finance Shiv Pratap Shukla informs in Parliament that the GST Anti-Profiteering Authority has issued orders against 9 businesses which were found to have not passed on rate cut benefits to the tune of Rs 559.88 Crore to consumers
👉To improve ease of doing business, the Lok Sabha on Friday passes the Companies (Amendment) Bill, 2018, designed to reduce the National Company Law Tribunal`s (NCLT) burden in volume of Insolvency Cases, as well as prescribe Strong Action against Non-Compliant Companies. The Bill was necessitated as the Companies (Amendment) Ordinance, 2018 was promulgated on November 2, 2018. It amends several provisions in the Companies Act, 2013, relating to penalties, among others.
👉PNB fraud case: Enforcement Directorate(ED) attaches Mehul Choksi's Factory Premise worth Rs 13.14 crore in Thailand under the Prevention of Money Laundering Act (PMLA), 2002.
👉CBI Arrests an Income Tax Officer and Two Others in a Bribery Case in Fatehabad (Haryana)
👉NSE Partners & signs MoU with IIT Kanpur to strengthen Cyber Security Solutions for Indian Capital Market
👉ICAI sends Notices to The Times of India for publication of Derogatory Cartoon and to Gujarat Mitra for publication of derogatory news against CA’s