21st May 2K19
Economic Times
Ø RCEP: Aluminium body cautions govt about China
Ø WTO warns trade weakness to continue in Q2
Ø Australian election results bode well for Adani
Ø India adopts new standards for measuring units
Ø Irdai proposes to increase 3rd-party insurance premium
Business Standard
Ø MNC boardrooms open doors to Indian women leaders
Ø Power sector's outstanding regulatory assets at Rs76,963 cr
Ø Full blow trade war will push world towards recession: Morgan Stanley
Ø Auditor exits mount at listed SMEs as scrutiny increases after IL&FS crisis
Ø Torrent Pharma reports Q4 net loss of Rs 152 crore, cites drug recall
Ø Lakshmi Vilas rejects Religare Finance's disclosure, threatens action
Business Line
Ø WTO: US seeks to join Japan-India consultations on IT product tariffs
Ø Tata Motors profit dips 47 % in Q4
Ø WTO quarterly trade growth indicator still at nine-year low
Ø HPCL Q4 net profit jumps 70% on inventory gains
Ø Gold imports rise 54% to $ 3.97 billion in April
Ø Ford to cut about 10% of global salaried workforce
Mint
Ø ICICI Bank to buy stake in BSE subsidiary INX for ₹31 crore
Ø BPCL Q4 net profit rises 16% to ₹3,125 cr; revenue up 10% at ₹83,942 cr
Ø JLR posts 1st profit in four quarters despite China woes
Ø Adani Green Energy's 8.75 crore shares to be offered for sale on Tuesday
Ø Bitcoin roars back from 'flash crash' to breach $8,000 once more
Business Line
Ø Bank credit to infra sector grows 18.5% in FY19: RBI data
Ø TRAI says up to government to take a call on Huawei issue
Ø ArcelorMittal to pay Rs 42,000 crore for Essar Steel takeover: Company tells NCLAT
Deccan Chronicle
Ø Dr Reddy’s to spend $300 million on R&D in FY 20
Ø Rupee records biggest gain in 2 months after exit poll results
Ø Gold loses sheen, falls Rs 150 on lacklustre demand
Ø Investor wealth soars Rs 5.33 lakh cr as exit polls predict return of NDA govt
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MCA brings more clarity on guidelines for reserving the name of the Company
Though, MCA has created a dedicated unit Central Registration Centre (CRC) to expedite the incorporation related activities including Name approval, yet the stakeholders were facing difficulty in getting the name approved due to lack clarity in the Rules for selection of desired name. This amendment may bring relief to the stakeholders while choosing the name of a company. Revised Rules with detailed illustration will serve as readymade guidance for both practicing professionals and CRC thereby further easing the incorporation process.
The MCA has amended the Companies (Incorporation) Rules, 2014. In the revised Rule 8 for reservation of name of a company, the Ministry has elaborated the provision by inserting various illustrations. The Rule has been divided in to 2 parts - Rule 8A and Rule 8B.
Rule 8A deals with the undesirable names and Rule 8B limits use of words such as Board, commission, National, Republic etc. only after obtaining previous approval of Central Government.
While considering the application related to name approval the following illustrations must be considered otherwise the names shall be considered as undesirable and will not be approved. Some of the illustrations have been discussed hereunder:
1. Name should not be identical to singular or plural form of existing company;
User of plural or singular form of the words will be considered as undesirable and such name wouldn't be approved by authority on receipt of application for reservation of name of company. This can be better understood with the help of illustration as provided by MCA:
👉For e.g. Green Technology Limited shall be considered same as Greens Technology Limited and Greens Technologies Limited.
2. Change in Tense would be considered as Similar Name;
The department will reject the application for reservation of name of the company if someone use different tense in name of the company such as:
👉Ascend Solution ltd. is same as Ascended Solutions Ltd and Ascending Solutions Ltd.
3. Different use of phonetic spellings is treated as identical name;
Chemtech Ltd is same as Chemtec Ltd, Chemtek Ltd, Cemtek ltd, Kemtech Ltd and Kemteck Ltd.
4. Change in order of words of name and use of article before proposed name
The application for reservation of name will not be considered if an applicant just changes the order of words or use of article before any name of the existing company for e.g.:
👉 1.Ravi Builders and Contractors Ltd is same as Ravi Contractors and Builders Ltd
👉2.Congenial Tours Ltd is same as A Congenial Tours Ltd. and The Congenial Tours Ltd.
5. Variation in spelling of two name;
Name including slightly variation in spelling of existing company name would be considered as resembling name and department will reject the application for reserving a name of the company. For example,
👉Color Technologies Ltd is similar as Colour Technologies Ltd.
6. Addition, deletion or modification of exiting name;
Addition, deletion or modification in any existing name of the company is not allowed and the concerned department will spare no time to reject the proposed name of the company. To instance,
👉1.Salvage Technologies Ltd is an existing name and it is same as Salvage Technologies Delhi Ltd. and Salvage Delhi Technologies Ltd.
👉2.Thunder Services Ltd is same as Thunder11 Services Ltd. and OneThunder Services Ltd.
7. Change in meaning either in Hindi or English:
Complete translation or transliteration or nay part of an existing name either in Hindi or English. For Example:
👉National Electricity Corporation Ltd is same as Rashtriya Vidyut Nigam Ltd.
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the new Form 16 will change income tax filing, ET
Form 16 is issued annually, by an employer to an employee as a proof of salary paid and taxes deducted on it. It has two parts i.e., Part A and Part B as discussed below.
Tax returns of the salaried taxpayers for FY 2018-19 (AY 2019-20) can be filed in form ITR-1 or ITR-2.
The details of income from salary, allowances exempt, deductions claimed, are in Part B of Form 16, while Part A contains the employer, employee and employment details such as PAN, address etc.
The Central Board of Direct Taxes (CBDT) has notified certain changes in Form 16.
The new Form 16 is made effective from 12 May, 2019. Employers issuing Form 16 for the financial year 2018-19 will have to issue them in the new format.
1) Details under the new Form 16:
Under the new format of Form 16, Part B has been amended to provide more details about the allowances exempt under section 10 such as house rent allowance, leave travel allowance etc., and deductions allowed under Chapter VI-A of the Act i.e. section 80C to 80U.
Form 16 will contain information about the below allowances:
Exempt Allowances required to be disclosedExempt under section
Leave travel concession10(5)
Death cum retirement gratuity10(10)
Commuted value of pension10(10A)
Leave encashment10(10AA)
House rent allowance10(13A)
Any other amount exempt under section 10Additionally
Form 16 will contain information about the below deductions:
Deductions required to be disclosedSection
Life insurance premium paid, contribution to PPF etc.80C
Contribution to pension funds80CCC
Employee’s contribution to pension scheme80CCD(1)
Taxpayer’s self contribution to notified pension scheme80CCD(1B)
Employer’s contribution to pension scheme80CCD(2)
Health insurance premium paid80D
Interest paid on loan taken for higher education80E
Donations80G
Interest income on savings account80TTA
Amount deductible under any other provision of Chapter VI-A
2) Impact on ITR filing.....
Form 1&2 Can be easily filled by using this form part B.
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👉CBDT do not want to let go the Revenue Dues owed by Shell Companies that have been deregistered by the MCA. But the task is easier said than done, as it would mean the restoration of over 4,000 companies identified by the CBDT. The CBDT has been holding talks with the MCA over this.
👉RBI wants NBFCs with assets of more than ₹5,000 Crore must appoint a Chief Risk Officer (CRO). It said that with the increasing role of NBFCs in direct credit intermediation, there is a need for NBFCs to Augment Risk Management Practices.
👉RBI Appointed Committee headed by Aadhaar architect Nandan Nilekani submits its suggestions on Promoting Digital Payments to RBI Governor Shaktikanta Das. The 5-member team was formed in January this year to consult with various stakeholders of the payments ecosystem and deliberate on solutions to further strengthen the industry.
👉SEBI and RBI to tighten Credit Rating Agencies’ Biz Models, to avoid another IL&FS. They are looking into how rating agencies conduct Due Diligence, to stall the practice of “Ratings Shopping” where companies pay agencies to provide them with high rating.
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Delhi High Court restrained the Income Tax Department from taking any action against VVIP chopper deal scam accused Gautam Khaitan against whom a black money case has been lodged. Court said Khaitan, an advocate by profession, has made out a "good prima facie" case for grant of interim relief and grave prejudice would be caused to him if the authorities are not restrained at this stage from proceeding further.
GST; the new option has been introduced wherein the consignment of one e-way bill has to be moved in multiple vehicles, after moving to transshipment place.
GST: different high courts in the country have given stay orders on several fiats of the National Anti-profiteering Authority (NAA) for the GST, casting doubts on the legal tenability of the way the nearly one-and-half-a-year-old set-up operates and passes orders on alleged cases of profiteering by businesses.A review by FE revealed that at least five firms have got reliefs from the high courts, in what allowed them to defer coughing up an aggregate amount of Rs 430 crore.
The Directorate General of Foreign Trade has issued a Policy Circular regarding Non-requirement of submission of Hard copy of application at RAs for issue of Advance Authorisation (AA) & EPCG Authorisation.
Government is open to providing more powers to the RBI to direct lenders to take action on stressed assets. There is a growing view in the government that there has to be some regulatory supervision over debt resolution by the RBI.
The Ministry of Corporate Affairs has notified the National Company Law Tribunal (Second Amendment) Rules, 2019 which shall come into force on the date of its publication in the Official Gazette that is on May 08, 2019.
Ministry of Statistics and Programme Implementation (MoSPI) plans to compile a national business register of all business enterprises in the country that can be periodically updated
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#CBDT is in a process of amending Rule 10 related to Attribution of Profits to Permanent Establishment in #India.
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🏦 Capital Market Updates🏦
May 20 - May 26, 2019
1. 🏭 CEAT ’s underperformance may be attributed to the aggressive marketing by its competitors and new entrants in the two-wheeler tyre segment. It may be prudent to SELL now and BUY later.
2. 💸 Punjab National Bank (PNB) is coming out of the mess. With PNB Housing Finance outperforming the market, it may be a good idea to ACCUMULATE PNB.
3. ⚗ With almost double the profits for FY19 and a huge dividend, Vinati Organics is an excellent long-term BUY.
4. 🧪 SRF posted 54% higher PAT on 28% higher sales for Q4FY19. With improving fundamentals, its future looks bright. BUY.
5. ☕ Tata Chemicals plans to transfer its consumer products business to Tata Global Beverages (TGBL). BUY TGBL.
6. 💡 Torrent Power posted 89% lower consolidated PAT for Q4FY19. Stay AWAY from this counter for some time.
7. ⚗ National Peroxide, which posted fantastic Q3 results, is likely to fare better in the next few quarters. BUY.
8. 💸 Jammu & Kashmir Bank reported a fourfold jump in Q4 PAT. A safe investment bet.
9. 💸 Yes Bank is likely to recover soon. ACCUMULATE in small quantities.
10. 💰 All the divisions of L&T Finance Holdings are doing well. An excellent BUY in the current volatile markets.
11. 🔖 Polyplex Corporation refuses to come down even amidst jittery market conditions. High earnings and a good dividend yield makes this company a safe INVESTMENT bet.
12 ⛽ Linde India is recovering probably on renewed hopes of a fresh buy back bid by the Board. A good speculative BUY.
13. 💸 Union Bank reported a loss of ₹3370 crore in Q4 mainly on account of higher provisioning. Stay AWAY from this counter.
14. 🦐 In spite of a stiff competition from global markets and margins under pressure, Waterbase posted fairly good results with an EPS of ₹7.45 and a higher dividend pay-out. With its hatchery division operational, the company is likely to fare better going forward. An attractive BUY.
15. 💸 Central Bank Q4 loss has widened to ₹2477 crore on account of higher provisioning. Stay AWAY from this counter.
16. 💉 Dr. Reddy’s Laboratories is confident that the launch of Daptomycin injection in USA will boost profitability. ACCUMULATE.
17. ⚗ TGV SRAAC (formerly Sree Rayalaseema Alkalies & Allied Chemicals) posted over 130% higher PAT for FY19. Its share price is bound to rise. BUY.
18. 🍕 Jubilant FoodWorks (owner of Domino’s Pizza) posted 9% higher PAT for Q4 in spite of some loss due to closure of some stores in Sri Lanka. BUY selectively.
19. 🧪 SKF India’s performance in Q4 and FY19 improved significantly. The company proposes to buy back up to 19,00,000 shares. A smaller equity capital and higher sales will boost its earnings further. BUY for the long term.
20. 🏭 Kesoram Industries witnessed a turnaround in Q4 with a net profit of ₹20.75 crore v/s a net loss of ₹158.17 crore in the previous corresponding quarter. Its future looks bright. BUY.
21. 🎛 Going by its expansion plans, Pitti Engineering is likely to notch an EPS of ₹8.5 for FY20. BUY for about 40% returns in the medium term.
22. 🖥 With a 21% jump in PAT, Datamatics Global Services posted an EPS of ₹12.6 for FY19. A reasonable P/E of 12x will take its share price to ₹150+.
23. 🚨 Security & Intelligence Services is likely to notch an EPS of ₹36 for FY20 v/s ₹29 in FY19. BUY for about 30% returns.
24. 🏭 Eimco Elecon, in which Sandvik Asia holds 25% stake, has posted an EPS of ₹40 for FY19. The stock has the potential to cross ₹600 in the medium term.
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💡 Order of utilisation of ITC to be continued as before and new set off rules which were to be effective from 01.02.2019 has been deferred till the time new functionality is incorporated in portal to give effect to the changes.
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AAR allows input tax credit by debt settlement under GST regime:
READ MORE- https://www.gststation.in/aar-allows-input-tax-credit-by-debt-settlement-under-gst-regime/
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Income-tax authorities do not want to let go the revenue dues owed by shell companies that have been deregistered by the MCA. CBDT to file the restoration application with the National Company Law Tribunal (NCLT). MCA will support their stand.
Gujrat High Court in the matter of Neuvera Wellness Ventures Pvt Ltd Vs State of Gujarat orders release of goods being perishable on furnishing security by way of bond under GST.
Government has declined to share details on black money received from Switzerland, citing confidentiality. Replying to an RTI query, the Finance Ministry said India and Switzerland share information on black money on a case to case basis as per the investigations being carried out.
RBI has placed on its website the “Payment and Settlement Systems in India: Vision 2019 – 2021”. The Payment Systems Vision 2021 with its core theme of ‘Empowering Exceptional (E) payment Experience’ aims at empowering every Indian with access to a bouquet of e-payment options that is safe, secure, convenient, quick and affordable.
SEBI refused to lift the market ban imposed on Allied Financial Services and seven entities in a case of alleged misappropriation of clients' securities. It has found that mutual funds of Novjoy Emporium Pvt Ltd, OCL India Ltd and Dalmia Cement East Ltd were allegedly transferred illegally by Allied to IL&FS Securities Services as a collateral for margins of Allied.
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👉🏻Govt plans introducing artificial intelligence system in MCA 21 portal
(Govt plans to introduce artificial intelligence system in the MCA 21 portal as it seeks to make the compliance process easier as well as ensure routine enforcement activities are done round-the-clock on autopilot basis)
👇🏻 👇🏻 👇🏻
http://bit.ly/2HC9Sfg
👉🏻AAR allows input tax credit by debt settlement under GST regime
(Companies can claim input tax credit under the goods and services tax regime even if the liability to pay for inputs between them, including tax)
👇🏻 👇🏻 👇🏻
http://bit.ly/2Wet9wD
👉🏻MCA mulls stricter audit norms amid IL&FS crisis
(Govt is now considering a revamp of the auditing process, making it more transparent, and auditors more accountable)
👇🏻 👇🏻 👇🏻
http://bit.ly/2WRSGZH
👉🏻Audit of Accounts of MECON Employees Provident Fund Trust and Gratuity Trust
(Competent audit firm to conduct audit of Provident Fund Accounts for the year 2018-2019 & Gratuity Trust Accounts for the year 2018-2019)
👇🏻 👇🏻 👇🏻
http://bit.ly/2HrZXKi
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GST: Power producers seek removal of double taxation on imported coal:
READ MORE- https://www.gststation.in/gst-power-producers-seek-removal-of-double-taxation-on-imported-coal/
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GST Council may consider national bench of AAAR next month; move to give certainty to taxpayers:
READ MORE- https://www.gststation.in/gst-council-may-consider-national-bench-of-aaar-next-month-move-to-give-certainty-to-taxpayers/
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Relief for importers as Gujarat HC stays IGST levy on ocean freight:
READ MORE- https://www.gststation.in/relief-for-importers-as-gujarat-hc-stays-igst-levy-on-ocean-freight/
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Non-filing of Income Tax Return can’t be a ground to deny Capital Gain Exemption: ITAT [Read Order]
Read more at: https://www.taxscan.in/filing-income-tax-return-capital-gain-exemption-itat/35760/
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Know Search Verify Your GSTIN GST Number:
READ MORE- https://www.gststation.in/know-search-verify-your-gstin-gst-number/
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MCA UPDATE:
Rules are amended to make the directors accountable for failure in filing of ACTIVE form within specified due date.
1) DIN of all the directors associated with Companies which are governed under rule 25A of the Companies (Incorporation) Rules, 2014, shall be marked as “Director of ACTIVE non-compliant company”.
2) All the above mentioned directors have to take necessary steps to comply with the filing of ACTIVE form in all the companies.
3)After complianing with all ACTIVE form, DIN of all such directors will be marked as “Director of ACTIVE compliant company".
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Here are some important case laws which were passed recently - It may be helpful in proceeding of Appeal before Supreme Court, High Court, Income Tax Appellate Tribunal (ITAT), and CIT (A). Also helpfully for Assessment & Reassessment cases.
1. Benami Transactions: While considering whether a particular transaction is benami, the intention of the person who contributed the purchase money is determinative. The intention has to be decided on the basis of surrounding circumstances; relationship of parties; motives governing their action in bringing about the transaction and subsequent conduct. The payment of part sale consideration & stamp duty cannot be the sole criteria to hold the sale/transaction as benami.
Mangathai Ammal vs. Rajeswari (Supreme Court) CIVIL APPEAL NO. 4805 OF 2019
2. ITAT Members' Appointment: The action of the Selection Committee of short-listing only 24 candidates for interview out of 649 applications is not violative of Article 14. The criteria of short-listing Advocates in practice for at least 20 years and with income of not less than Rs. 1.40 lakh for post of Judicial Member is rational and reasonable and not arbitrary
Puneet Sharma vs. UOI (Delhi High Court)
3. 14A/ Rule 8D: Though, after Maxopp Investment 402 ITR 640 (SC), even "strategic investments" have to be considered for disallowance, the assessee is entitled to contend that the investments are "legacy" or "one-time" and that there is in fact no expenditure incurred to earn the tax-free income (Favour of Assessee)
CIT vs. Alpha G. Corp Development Ltd (Delhi High Court), C.M. APPL.21050/2018
4. The ICAI has jurisdiction to examine any conduct (including alleged sexual harassment) by a CA that would tend to bring disrepute to the profession or the Institute. The fact that the matter is pending trial before the Criminal Court is not relevant because the standards of proof are different. The ICAI may or may not await the outcome of the trial depending on the circumstances (Gurvinder Singh 259 TM 311 (SC) followed)
Lalit Agrawal vs. ICAI (Delhi High Court), W.P.(C) 10020/2016
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HC allows input tax credit under GST regime to realtor making shopping mall:
READ MORE- https://www.gststation.in/hc-allows-input-tax-credit-under-gst-regime-to-realtor-making-shopping-mall/
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Benami Transactions: While considering whether a particular transaction is benami, the intention has to be decided on the basis of surrounding circumstances; relationship of parties; motives governing their action in bringing about the transaction and subsequent conduct. The payment of part sale consideration & stamp duty cannot be the sole criteria to hold the transaction as benami. Mangathai Ammal vs. Rajeswari (Supreme Court).
CBDT removed a taxation related constraint that prevented Indian AMCs from taking up direct fund management activity for the offshore funds. Asset management companies (AMCs) can now graduate from being mere ‘advisors’ to offshore funds to becoming a direct, “full fledged manager” of such funds out of India.
Bengal wing of AAR made the ruling that Companies can claim ITC under the GST regime even if the liability to pay for inputs between them, including tax, is discharged through adjustments in their books.
MCA Notification dated 16.05.2019. The Companies (Appointment and Qualification of Directors) Second Amendment Rules, 2019, Rule 12B is being inserted in original rules- If a company does not file form Active then the status of DIN of Director shall be changed to Director of ACTIVE non-compliant Company.
Corporate affairs ministry plans to introduce artificial intelligence system in the MCA 21 portal as it seeks to make compliance process easier as well as ensure routine enforcement activities are done round-the-clock on autopilot basis.
Top executives of listed companies face challenges over bonuses thanks to new disclosure norms implemented by the Sebi. The new rules make minority shareholder approval mandatory for all bonuses paid to top executives on or after April 1.
ICAI has reduced its membership fee via promoting I GO GREEN with ICAI scheme under which Member opting e-journal will be given a discount of Rs.590/- (including 18% GST) on total amount of Membership Fees. Link https://memfee.icai.org/memfee.html
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Expect new govt. to bring petroleum under ambit of GST: HPCL Chairman:
READ MORE- https://www.gststation.in/expect-new-govt-to-bring-petroleum-under-ambit-of-gst-hpcl-chairman/
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GST and inter-branch transactions fraught with potential litigation:
READ MORE- https://www.gststation.in/gst-and-inter-branch-transactions-fraught-with-potential-litigation/
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Most builders opt for 12% GST slab for ongoing projects:
READ MORE- https://www.gststation.in/most-builders-opt-for-12-gst-slab-for-ongoing-projects/
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Charging GST on discounted items an ‘unfair trade practice’:
READ MORE- https://www.gststation.in/charging-gst-on-discounted-items-an-unfair-trade-practice/
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ArcelorMittal tells NCLAT it will pay Rs 42k cr for Essar Steel takeover:
READ MORE- http://www.ibcguide.com/arcelormittal-tells-nclat-it-will-pay-rs-42k-cr-for-essar-steel-takeover/
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RBI to hold ‘structured meetings’ with bank auditors to deal with divergences:
READ MORE- http://www.ibcguide.com/rbi-to-hold-structured-meetings-with-bank-auditors-to-deal-with-divergences/