Monthly Archives: July 2015

Speed Post is Registered Post for Service of Notice

Question Whether the speed post is registered post ? Whether the Notice served with Speed Post will be treated as Served with Registered Post? Answer : Registered post would take within its sweep not only ‘speed post’ but also all other mails forming part of the establish system of mails in which their receipt and… Read More »

Changes in new ITR Form 3, 4, 5, 6 and 7

Key changes in new ITR Form 3, 4, 5, 6 and 7  I. Introduction: The new ITR Forms 1, 2 and 4S were notified for the Assessment Year 2015-16 vide Notification No. 41/2015, Dated 15-04-2015. However, in view of representations received from various stakeholders, the CBDT came out with simplified version of ITR forms 1,… Read More »

KYC Records Registry

Central KYC Records Registry under Money Laundering   PREVENTION OF MONEY-LAUNDERING (MAINTENANCE OF RECORDS) AMENDMENT RULES, 2015 – AMENDMENT IN RULES 2, 9 & 10 AND INSERTION OF RULE 9A NOTIFICATION NO.4/2015 [P.12011/5/2011-SO(ES.CELL)]/GSR 544(E), DATED 7-7-2015 In exercise of the powers conferred by sub-section (1) read with clauses (i), (j), (jj), (jjj) and (k) of sub-section… Read More »

Tax on membership fees

QUESTION : How the Tax on membership fees will be paid  ?  Whether Non Refundable membership fees  will be taxed in the year of receipt or it will have to be apportioned  over the Period of Membership. ? Answer :  Non refundable membership fee has to be apportioned and taxed during period of membership. The assessee company is engaged… Read More »

Audit of Engineering Industry

Institute of Cost Accountants issues guidance on internal audit of Engineering Industry The Institute of Cost Accountants of India (ICAI) has recently issued a guidance note on internal audit of Engineering industry which provides elaborated guidance to auditors on the aspects to be considered while performing internal audit. The document provides elaborated guidance on the… Read More »

Audit of plantation industry

Institute of Cost Accountants issues guidance on internal audit of plantation industry    The Institute of Cost Accountants of India (ICAI) has recently issued a guidance note on internal audit of plantation industry which provides elaborated guidance to auditors on the aspects to be considered while performing internal audit. The document provides elaborated guidance on… Read More »

Internal audit of Power Industry

Institute of Cost Accountants issues guidance on internal audit of Power Industry  The Institute of Cost Accountants of India (ICAI) has recently issued a guidance note on internal audit of power industry which provides elaborated guidance to auditors on the aspects to be considered while performing internal audit. The document provides elaborated guidance on the… Read More »

Merchant Banker SEBI issued FAQ

SEBI issued FAQs for Merchant Bankers FAQ ON MERCHANT BANKERS  PRESS RELEASE, DATED 16-7-2015 1. What is the procedure of obtaining registration as a Merchant Banker from SEBI? For registration as a Merchant Banker, an applicant is required to pay a non-refundable application fee of Rs.50,000/- by way of demand draft drawn in favour of… Read More »

Draft Rules on Land Acquisition Act

RIGHT TO FAIR COMPENSATION AND TRANSPARENCY IN LAND ACQUISITION, REHABILITATION AND RESETTLEMENT (COMPENSATION, REHABILITATION AND RESETTLEMENT, DEVELOPMENT PLAN) RULES, 2015 NOTIFICATION NO. GSR 547(E) [F.NO.13011/01/2015-LRD), DATED 8-7-2015 The following draft of certain rules, which the Central Government proposes to make in exercise of the powers conferred by clauses (b), (e), (f), (g), (h), (i), (j), (k),… Read More »

Tax Challan

COLLECTION OF DIRECT TAXES – OLTAS MASTER CIRCULAR DGBA.GAD. NO.3/42.01.034/2015-16, DATED 1-7-2015 This circular may be downloaded from  website www.mastercirculars.rbi.org.in. (Extract of circular) Mandatory Electronic Payment of Tax by Certain Categories of Taxpayers CBDT has made electronic payment of taxes mandatory for the following categories of taxpayers: A Company A person (other than a company) to whom provisions of… Read More »

NO TDS on Service tax

Question : Whether TDS is to be deducted on the  amount of the Bill including Service tax  or amount of the bill excluding Service Tax ? Answer NO TDS on Service tax is to be deducted  if as per the  terms of the agreement between the payer and the payee, the service tax component comprised in… Read More »

Section 194H TDS on Discount allowed on recharge coupons

Discount allowed by assessee to its distributors in respect of starter packs and recharge coupons for its prepaid mobile service amounted to payment of commission or brokerage requiring deduction of tax at source under section 194H HIGH COURT OF CALCUTTA Hutchison Telecom East Ltd. v. Commissioner of Income-tax, TDS, Kolkata GIRISH CHANDRA GUPTA AND ARINDAM… Read More »

MRP on cement cleared to builders and Govt

Question : Whether there is a need to declare MRP on cement cleared to builders and Govt.? Answer : Builders, government and RMC (Ready-mix Concrete) producers quality as ‘industrial/institutional buyers’ and there is no need to declare RSP (retail sale price) on cement cleared to them CESTAT, NEW DELHI BENCH Ultratech Cement Ltd. v. Commissioner of Central… Read More »

Preoperative expenses are Revenue expenses if

  Question : Whether the Preoperative Expenses are Revenue expenses if company expanded its existing business?   Answer : Where assessee company expanded its existing business and claimed said expenses as pre-capitalisation cost, same was to be treated as revenue expenditure HIGH COURT OF DELHI Commissioner of Income-tax v. SRF Ltd. S. RAVINDRA BHAT AND R.… Read More »

Anonymous donations tax treatement

Offerings received in donation boxes of temple can’t be taxed as black money under Sec. 115BBC IN THE ITAT MUMBAI BENCH ‘G’ Gurudev Siddha Peeth v. Income-tax Officer, Ward- 1 (1), Kalyan R.C. SHARMA, ACCOUNTANT MEMBER AND SANJAY GARG, JUDICIAL MEMBER IT APPEAL NOS. 3466 AND 3467 (MUM.) OF 2012 [ASSESSMENT YEARS 2007-08 & 2008-09… Read More »

Section 115JB profit arising on sale of share

IN THE ITAT MUMBAI BENCH ‘D’ Dharmayug Investments Ltd. v. Assistant Commissioner of Income-tax, Range 1 (1), Mumbai B.R. BASKARAN, ACCOUNTANT MEMBER AND AMIT SHUKLA, JUDICIAL MEMBER IT APPEAL NO. 1284 (MUM.) OF 2013 [ASSESSMENT YEAR 2009-10] JUNE  10, 2015 While computing book profits under Section 115JB whether profit arising on sale of shares ought… Read More »

payable under section 40(a)(ia)

Requirement to deduct tax at source under section 194C is mandatory and, in case of assessee’s failure to do so in respect of contractual payments, disallowance has to be made under section 40(a)(ia) irrespective of fact as to whether assessee is following cash or mercantile system of accounting HIGH COURT OF PUNJAB AND HARYANA P.M.S.… Read More »

CBEC clarifies on withdrawal of exemption to domestically manufactured goods

JUDGMENT OF SUPREME COURT IN CASE OF SRF LTD. V. COMMISSIONER OF CUSTOMS, CHENNAI [2015] 56 taxmann.com 407 (SC) – CLARIFICATION RELATING TO NOTIFICATIONS NO.30/2004-C.E., DATED 9-7-2004; NO.1/2011-C.E., DATED 1-3-2011 AND NO.12/2012-C.E., DATED 17-3-2012, AS AMENDED FROM TIME TO TIME CIRCULAR NO.1005/12/2015-CX, DATED 21-7-2015 It may recalled that the Hon’ble Supreme Court, in the case… Read More »

Documents required for Tax exemption section 11(1)(c)

Documents required for Tax exemption section 11(1)(c) Date: 27.07.2015 Subject: Part III of the Standard Operating Procedure (SOP) (Part I – 08.07.2015) for making application for claim of tax exemption u/s 11(1)(c) of the Income-tax Act, in respect of remittance of money/relief articles by Indian NGOs/Charitable Organisations for earthquake hit people in Nepal. In view… Read More »

NAME OF COMPANY

SECTION 4 OF THE COMPANIES ACT, 2013 – MEMORANDUM – NAME OF COMPANY – USE OF WORD ‘NATIONAL’ IN THE NAMES OF COMPANIES OR LIMITED LIABILITY PARTNERSHIPS (LLPs) GENERAL CIRCULAR NO.2/2014 [F.NO.2/2/2014-CL-V], DATED 11-2-2014 It has come to the knowledge of this Ministry that Companies/Limited Liability Partnerships are being registered with the word ‘National’ in… Read More »

Refund of CENVAT available when export proceeds were not realized

Issue: Whether refund of CENVAT credit is allowed if input services were used in relation to export and the export proceeds were not realized? Held: Yes,Refund of CENVAT available when export proceeds were not realized  M/s P&P Overseas Vs. Commissioner of Central Excise, Excise Appeal Nos. 1307-1308 of 2011, Date of Decision: 29.10.2014, CESTAT –… Read More »

Brand expenses are revenue expenses

Question :Whether the brand registration expenses and other expenses upon development of brand incurred by assessee are in the nature of revenue expenditure ? Held  :Yes, Brand expenses  are revenue expenses and can be debited in profit and loss account and reduced from the income. M/s Seagram Distilleries Pvt. Ltd. Vs. Jt. Commissioner of Income Tax,… Read More »

Forensic Audit

Forensic Audit   Introduction With the growing complexity of business environment and other complex issues of financial market, cases of scams and financial irregularities are on a spree. None the less, these scams are highly affecting the Indian business environment and thus act as a key factor for downgrading the Indian economy. Subsequently the number of… Read More »

SCRUTINY OF SERVICE TAX RETURN

            SCRUTINY OF SERVICE TAX RETURN                    REVISED GUIDELINES FOR SCRUTINY OF ST-3 RETURN CIRCULAR NO. 185/4/2015-ST [F.No.137/314/2012-ST], DATED 30-6-2015 1. In the era of self-assessment, the need for a strong compliance verification mechanism cannot be over emphasized. Such a mechanism has… Read More »

Mistakes to avoid when filing Income Tax returns

Mistakes to avoid when filing Income Tax returns Interest on Fixed Deposits and Investments Don’t forget to include interest earned on investments and also declare those exempt from tax , like dividend income, PPF interest Interest Earned on FDR opened in the name of Minor Child You open a recurring deposit in your child’s name… Read More »

SIT on Black money

Recommendations of SIT on Black Money as Contained in the Third SIT Report Misuse of exemption on Long Term Capital gains tax for money laundering Misuse of Participatory notes for money laundering Shell Companies and beneficial ownership (Reference p. 73-76 of the Third SIT Report) Action under PMLA for Trade Based Money laundering Use of… Read More »

Gold Deposit Scheme (GDS)

Gold Deposit Scheme (GDS): Salient Features Include-All Designated Banks can Operate GDS as per Guidelines  The Central Government, with a view to bring privately held stock of gold in circulation, to reduce the country’s reliance on import of gold and to provide its owners with some income apart from freeing them from the problems of… Read More »

How NRIs can claim tax benefits under DTAA

How NRIs can claim tax benefits under DTAA Double Taxation Avoidance Agreement or DTAA is an agreement between two countries which aims to avoid taxation of the same income in both countries. India has signed the DTAA with several countries. During assessment of an assessee to whom DTAA applies, the provisions of the Income Tax… Read More »

Different financial year of Company

Different financial year of Company Query: I have a query my client is following financial year as Nov 2012 to Oct 2013. For complying with sec 2 (41) of companies act 2013, we are revising financial year from Nov 2013 to Dec 2014. We have not passed any BR to that effect till now. I would… Read More »

Service Tax Amnesty Scheme Order are appealable

Question : Service Tax Amnesty Scheme  Order are appealable ? Answer :’Designated authorities’ under Service Tax Voluntary Compliance Encouragement Scheme amount to ‘adjudicating authorities’, as they pass order/decision; hence, orders passed by them are appealable as per Finance Act, 1994 HIGH COURT OF MADRAS Narasimha Mills (P.) Ltd. v. Commissioner of Central Excise (Appeals) S. VAIDYANATHAN,… Read More »

ESOP to NR Employees

Cos. issuing ESOP to NR employees to furnish return to RBI in Form-ESOP within 30 days of their issuance ISSUE OF SHARES UNDER EMPLOYEES STOCK OPTIONS SCHEME AND/OR SWEAT EQUITY SHARES TO PERSONS RESIDENT OUTSIDE INDIA A.P. (DIR SERIES 2015-16) CIRCULAR NO.4, DATED 16-7-2015 Attention of Authorised Dealer Category – I (AD Category-I) banks is… Read More »

FAQs ON SECRETARIAL STANDARD

FAQs ON SECRETARIAL STANDARD ICSI replies to queries received on SS-1 and SS-2 ON SECRETARIAL STANDARD ON BOARD MEETINGS (SS-1) AND ON GENERAL MEETINGS (SS-2) PRESS RELEASE, DATED 21-7-2015 Scope/1. Is SS-1 applicable to banking entities which are listed on Stock exchanges? Ans. SS-1 is applicable to all companies incorporated under the Act (for definition… Read More »

Taxability of Premium received by society on transfer of plots

Taxability of Premium received by society on transfer of plots : Not  Taxable Where assessee-society received contribution from outgoing members as premium on sale of plot, since said amount was to be utilised for benefits of members of society, it could not be regarded as ‘taxable income’ in hands of assessee HIGH COURT OF GUJARAT… Read More »