Category Archives: Income Tax

No TDS on Payment of lease premium for leasehold rights of 90 years u/s Sec. 194-I TDS

Held Question : what is the nature of the payments made towards lease. Do they constitute rent so as to attract Section 194-I? The court is of opinion that clearly these payments are not “rent”. That they are annual payments cannot be doubted. Yet, part of the payment is clearly capital in nature. Clause 1… Read More »

India and Israel Tax treaty update

India and Israel Tax treaty update A Protocol amending the income tax treaty (1996) between India and Israel has been “notified” in Notification No. 10/2017. Read a February 2017 report [PDF 348 KB] of KPMG

Cash Transactions 2016 – User Guide / all resources from Income Tax Department

 Cash Transactions 2016 i.e Verification of Cash Transactions 2016 after Demonetization by India (from 08.11.2016 to 30.12.2016) Cash Transactions 2016 – User Guide by CBDT For Verification of Cash Transaction 2016 after Demonetization Guide has been issued by CBDT  read Online Verification of Cash Deposits during 9th Nov to 30th Dec 2016 -User Guide  Cash Transactions… Read More »

IDS 2016- Guidelines for Correction in challan attributes

OLTAS Instruction No. 53 DIRECTORATE OF INCOME TAX (SYSTEM) ARA Center, Ground Floor, E-2, Jhandewalan Extension New Delhi-110055 F. No. SW/07/01/06/OLTAS INSTRUCTION/DIT(S)II/ Dated: 13.02.2017 To, The Principal Chip Commissioners of Income-taxi Chief Commissioners of Income-tax The Principal Commissioners of Income—taxi Commissioners of Income-tax The Commissioner of income Tax (Computer Operation) Sub. Correction in challan an… Read More »

Release of new TDS/TCS RPU and FVU versions at NSDL w.e.f 23.02.2017

New versions of e-TDS/TCS Return Preparation Utility (RPU) and File Validation Utilities (FVUs) will be made available at TIN website from February 23, 2017. The free downloadable RPU and FVU software will be available at https://www.tin-nsdl.com/etds-etcs/eTDS-download-regular.php .   To submit the statement:   You need to know about Quick links   e-TDS/TCS Return Preparation Utility… Read More »

Demonetization : SOP Issued for Assessing Officer for Verification of Cash Transactions

CBDT issues Standard Operating Procedures to verify taxpayers’ cash transactions Instructions No 03/2017 Dated 21.02.2017 Related Post on Cash Transactions Cash Transaction 2016 -FAQ’s released for e-filing on income tax website Seized Cash by Police – Eligible for PMGKY scheme- P & H High Court How to reply to Income Tax Notice on SBN Cash… Read More »

No exemption for Specific corpus donation by exempt entities to other exempt entities w.e.f AY 2018-19

No exemption for corpus donation by exempt entities to other exempt entities [ Amendment in Section 11 of Income Tax Act – Applicable from Assessment Year 2018-19] Relevant extracts from Explanatory memorandum to the provisions of Finance Bill 2017 Restriction on exemption in case of corpus donation by exempt entities to other exempt entities As… Read More »

Initiation of assessment in case of search & seizure beyond 6 year

Initiation of assessment in case of search and seizure beyond 6 year ( Amendment as per Finance Bill 2017 in Sections 153A and 153C – Applicable from Assessment Year 2017-18 ] Memorandum Explaining Provisions of Finance Bill 2017 Rationalisation of provisions of the Income Declaration Scheme, 2016 and consequential amendment to section 153A and 153C… Read More »

Time limits for completion of Income Tax Assessment after Finance Bill 2017

Time limits for completion of Income Tax Assessment As per Finance Bill 2017 Table of Time limits for completion of Income Tax Assessment Section Particulars Applicable from Time limit 139(5) Time limit for furnishing revised return Assessment year 2018- 19 and onwards Up to the end of the relevant assessment year or before the completion of… Read More »

Income Tax Notice u/s 143(2) invalid as issued by ACIT instead of ITO

IN THE ITAT KOLKATA BENCH ‘D’ Krishnendu Chowdhury v. Income-tax Officer, Ward-1 WASEEM AHMED, ACCOUNTANT MEMBER AND S.S. VISWANETHRA RAVI, JUDICIAL MEMBER IT APPEAL NO. 1153 (KOL.) OF 2015 [ASSESSMENT YEAR 2010-11] NOVEMBER  18, 2016 Mahadeb Ghosh, Advocate for the Appellant. Md. Ghayas Uddin, JCIT – DR for the Respondent. ORDER Waseem Ahmed, Accountant Member… Read More »

History of Direct Taxation​ In India

History of​ Taxation Pre – 1922 “It was only for the good of his subjects that he collected taxes from them, just as the Sun draws moisture from the Earth to give it back a thousand fold” ––Kalidas in Raghuvansh eulogizing KING DALIP. It is a matter of general belief that taxes on income and wealth… Read More »

Indian subsidiary of Dutch holding company not “ permanent establishment ” in India

Indian subsidiary of Dutch holding company not “ permanent establishment ” in India  The Delhi Bench of the Income-tax Appellate Tribunal held that an Indian subsidiary of the taxpayer—a Dutch group holding company, engaged in selling storage system equipment and products (including embedded software) and rendering certain services in India—is not a permanent establishment under provisions of the… Read More »

Tax treatment of payments for bandwidth on underwater sea cable

Tax treatment of payments for bandwidth on underwater sea cable The Delhi Bench of the Income-tax Appellate Tribunal held that payments received by the taxpayer (operating a call center) for bandwidth connectivity charges are not taxable as royalty payments or as “fees for technical services” under provisions of the Income-tax Act, 1961 or the India-United States income… Read More »

Girish Ahuja Book on Direct Taxes Law & Practice AY 2017-18 for CA, CS, CMA Final Exam

Professional Approach to Direct Taxes Law & Practice, 35e, 2 Volumes for A.Y. 2017-2018 by Dr Girish Ahuja Dr Ravi Gupta  A comprehensive and critical study of the law relating to Income-tax written in a unique, simple, easy to understand language that enables a quicker grasp for the reader. The book is “user-friendly” and provides information… Read More »

Seized Cash by Police – Eligible for PMGKY scheme- P & H High Court

Held I am of the view that writ petition can be disposed of with a direction to respondents not to take any coercive action against the petitioner and he may be granted a permission to take the assistance of a lawyer to be present at visible but not audible distance during his interrogation and recording… Read More »

Income Tax (2nd Amendment) Rules 2017

[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)] GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE CENTRAL BOARD OF DIRECT TAXES Notification New Delhi, the 9 th February, 2017 G.S.R.117(E)- In exercise of the powers conferred by section 139A and sub-section (1) of section 203A, read with… Read More »

Interest on refund due to deductor on excess TDS deducted w.e.f AY 2017-18

Interest on refund due to deductor on excess TDS deducted [Section 244A of Income Tax Act – Applicable from Assessment Year 2017-18] Relevant extract of Budget Speech of union Budget 2017-18 on 01.02.2017 ( Annex III to Part B of Budget Speech ) Para 2.18. It is proposed to provide for grant of interest in case of… Read More »

Professionals allowed to pay advance tax in single installment w.e.f AY 2017-18 u/s 44ADA

Professionals allowed to pay advance tax in single installment [Section 211 and 234 of Income tax Act – Applicable from Assessment Year 2017-18 ] Relevant extract from Budget Speech on Union Budget 2017-18 on 01.02.2017 171. Last year, I had announced a new scheme for presumptive taxation for professionals with receipt upto Rs. 50 lakhs… Read More »

Direct Taxes Law and Practice (A.Y. 2017-18) by Dr. Vinod K. Singhania & Dr. Kapil Singhania

Direct Taxes Law and Practice (A.Y. 2017-18) by Dr. Vinod K. Singhania & Dr. Kapil Singhania For CA(Final) May/ November 2017, CS (Professional) June / December 2017, CMA (Final) June/ December 2017, M.Com./MBA/LL.B and Other specialised examinations for academic year 2017-18 You can buy this book for Rs 1190 . Click to buy this Book online.… Read More »

Exemption from TDS on insurance commission w.e.f 01.06.2017

Exemption from TDS on insurance commission [Section 194D of Income Tax Act – Applicable from 01-06-2017] Enabling of Filing of Form 15G/15H for commission payments specified under section 194D The existing provision of sub-section 194D of the Act, inter-alia, provides for tax deduction at source (TDS) at the rate of 5% for payments in the… Read More »

Period for claiming deduction by start-ups u/s 80IAC extended w.e.f AY 2018-19

Period for claiming deduction by start-ups [ Section 80-IAC – Applicable from Financial Year 2017-18 ( Assessment Year 2018-19) ] Extending the period for claiming deduction by start-ups The existing provisions of section 80-IAC, inter alia, provide that an eligible start-up shall be allowed a deduction of an amount equal to one hundred per cent… Read More »

20% deduction under NPS Scheme to Self-employed individuals w.e.f AY 2018-19

Deduction for National Pension System [Section 80CCD – Applicable from Financial Year 2017-18 ( Assessment Year 2018-19) ] Rationalisation of deduction under section 80CCD for self-employed individual The existing provisions of section 80CCD of Income tax act provides that employee or other individuals shall be allowed a deduction for amount deposited in National Pension System trusts… Read More »

Deduction for investment made under equity savings scheme withdrawn w.e.f AY 2018-19

Deduction for investment made under equity savings scheme is withdrawn [Section 80CCG of Income Tax Act – Applicable from Financial Year 2017-18 ( Assessment Year 2018-19 )] Under the existing provisions of section 80CCG of Income tax Act , deduction for three consecutive assessment years is allowed upto Rs. 25,000 to a resident individual for… Read More »

Taxability of Gifts in hands of every person w.e.f 01.04.2017

Gifts taxable in hands of every person [Section 56 of Income tax Act – Applicable from  01.04.2017 ] Widening scope of Income from other sources Under the existing provisions of section 56(2)(vii), any sum of money or any property which is received without consideration or for inadequate consideration (in excess of the specified limit of… Read More »

Exemption from Capital Gain tax on investment in long term bonds u/s 54EC w.e.f AY 2018-19

Expanding the scope of long term bonds under 54EC [Section 54EC  of Income Tax Act – Applicable from Assessment Year 2018-19] The existing provision of section 54EC of Income Tax Act  provides that capital gain to the extent of Rs. 50 lakhs arising from the transfer of a long-term capital asset shall be exempt if… Read More »

No capital gains Tax on conversion of preference shares into equity w.e.f AY 2018-19

No capital gains Tax on conversion of preference shares into equity [Section 47 of Income tax Act- Applicable from Assessment Year 2018-19 (Financial Year 2017-18) ] Under the existing provisions of the Act, conversion of security from one form to another is regarded as transfer for the purpose of levy of capital gains tax. However,… Read More »

Taxability in case of Joint Development Agreements w.e.f AY 2018-19

Special provisions for computation of capital gains in case of joint development agreement [Section 45(5A) of Income tax Act- Applicable from Assessment Year 2018-19 (Financial Year 2016-17) ] Under the existing provisions of section 45 of Income tax Act, capital gain is chargeable to tax in the year in which transfer takes place except in certain… Read More »

Cash Transaction 2016 -FAQ’s released for e-filing on income tax website

Cash Transaction 2016 Frequently Asked Questions The Online response for Cash Transactions, 2016 can be submitted by 15th Feb 2017. Frequently Asked Questions related to Cash Transactions, 2016 are now available Viewing Information 1. Which internet browser should I use to view and file response on e-filing portal? Ans: The e-filing portal and other utilities… Read More »

Unquoted shares taxable at fair market value w.e.f AY 2018-19 -Section 50CA

Fair Market Value to be full value of consideration in certain cases Under the existing provisions of the Income tax Act, income chargeable under the head “Capital gains” is computed by taking into account  the amount of full value of consideration received or accrued on transfer of a capital asset. In order to ensure that… Read More »

Shifting base year from 1981 to 2001 for computation of capital gains w.e.f AY 2018-19

Shifting base year from 1981 to 2001 for computation of capital gains The existing provisions of section 55 of Income tax Act provide that for computation of capital gains, an assessee shall be allowed deduction for cost of acquisition of the asset and also cost of improvement, if any. However, for computing capital gains in… Read More »