"July, 2015" Archive

ICAI President's Message – August 2015

Dear Friends, Despite diversity, the way educational system has developed and strengthened in India, we have to appreciate our ancestors for their vision and contribution. History confirms that India has been a destination for learning for centuries. Benjamin Franklin said: …only thing more expensive than education is ignorance. If ...

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Posted Under: CA, CS, CMA |

VAT not applicable on transfer of right to use of goods if effective possession and control of goods not transferred

Whether the Agreement of giving on hire two Deluxe buses for being run on the routes as per requirement of the person to whom they are hired, constitutes ‘transfer of right to use of goods’ so as to be liable to VAT under Section 2(1)(zc)(vi) of Delhi Value Added Tax Act, 2004?...

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Posted Under: CA, CS, CMA |

Various Types of Writs Under Constitution of India

Our constitution has given us various rights and obligations as a citizen of India. The Fundamental Rights to the citizen of India can be enforce through High Courts or Supreme Court of India according to the provisions of Article 32 of the Constitution. The High Courts or Supreme Court of India has power to issue various types of directo...

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Posted Under: CA, CS, CMA |

Directions issued by Central PF Commissioner to be complied by Sept 2015

Employer of the establishment covered under the Act is directed to a. Declaration in Form No. 11: Get the declaration in Form No. 11(New) from all the employees joining the establishment in a month and eligible to become member of the Fund and upload the same in Universal Account Number (UAN) Portal within 25 days […]...

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Posted Under: CA, CS, CMA |

Reimbursement from agents abroad for global telecommunication facility is not fees for technical service

Director of Income Tax Vs A.P. Moller Maersk A/S (Bombay High Court)

Due to the absence of any profit element in the amount paid by the agents it was held that it was purely in the nature of reimbursement of cost of MaerskNet. Further, MaerskNet was part of the shipping business and therefore subject to DTAA. ...

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What is Goods & Service Tax” As Per Supreme Court of Canada

Advocate Anandaday Misshra What is GST ? The Supreme Court of Canada in a case of  Reference re Goods and Services Tax had explained as to what is Goods & Service Tax . The important excerpts are reproduced herein below for better understanding of GST since the Indian GST is a version of Canada GST with a pinch […]...

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Posted Under: CA, CS, CMA |

Allowing credit period to the AE has to be considered along with main international transaction of sale of goods

ACIT Vs Information Systems Resource Centre Pvt. Ltd (ITAT Mumbai)

The transaction of allowing credit period to the AE on realization of sale proceeds is not an independent transaction and has to be considered along with the main international transaction of sale of goods....

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CBDT releases Manual on Exchange of Information

The CBDT had, in 2013, brought out a Manual to provide guidance to field officers on the scope and manner of exchange of tax-related information under the various tax treaties and agreements that India has entered into. Since then, there has been an increasing global consensus on the necessity of cooperation amongst countries to tackle th...

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Posted Under: CA, CS, CMA |

SEBI issues list of 193 defaulting Companies

Press Release No. 198/2015 (31/07/2015)

PR No. 198/2015-Caution to Investors 1. Some unlisted companies are luring retail investors by issuing  securities  including non-convertible and convertible debentures/ non-convertible and convertible preference  shares/ equity shares in the garb of private placement,  without  complying with the provisions of Companies Act, 1956 re...

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List of Companies involved in Corporate Frauds/Chit Fund Scams

Cases of Corporate Frauds/Chit Fund Scams Involving Companies The Ministry, during the last three years and current year, has ordered investigation into the affairs of 145 companies which were allegedly involved in illegal deposit taking activities.  A State-wise list of these companies is enclosed as Annexure. In many of the cases where...

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Posted Under: CA, CS, CMA |

Notification No. 36/2015-Customs (ADD), Dated: July 31, 2015

Notification No. 36/2015-Customs (ADD) (31/07/2015)

In exercise of the powers conferred by sub-section (1) and sub-section (5) of section 9A of the Customs Tariff Act, 1975 (51 of 1975), read with rules 18, 20 and 22 of the Customs Tariff (Identification, Assessment and Collection of Anti-dumping Duty on Dumped Articles and for Determination of Injury) Rules, 1995...

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Notification No. 35/2015-Customs (ADD), Dated: July 31, 2015

Notification No. 35/2015-Customs (ADD) (31/07/2015)

M/s Gaoyao Marshal Ceramics Co. Ltd., China PR (producer) through M/s Foshan Dihai Trading Development Co.Ltd., China PR (exporter) which have been subjected to provisional assessment pursuant to the Notification No.109/2011-Customs, dated the 15th December, 2011...

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Notification No. 72/2015-Customs (N.T.), Dated- 31st July, 2015

Notification No. 72/2015-Customs (N.T.) (31/07/2015)

S. O. 2093 (E)– In exercise of the powers conferred by sub-section (2) of section 14 of the Customs Act, 1962 (52 of 1962), the Central Board of Excise & Customs, being satisfied that it is necessary and expedient so to do, hereby makes the following amendment in the notification of the Government of India in the Ministry of Finance (De...

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Revised Guidelines: Grant of reward to informers & Govt Servants

Circular No. 20/2015-Customs (31/07/2015)

It has been decided with the approval of Hon'ble FM to issue completely revised fresh guidelines in tune with the various recommendations and changing scenario of smuggling, evasion of duties and service tax. Accordingly, the following revised consolidated guidelines are Said down in supersession of earlier guidelines for grant of reward ...

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Pr. DGIT (Admn.) to Manage Aayakar Sewa Kendras (ASK)

Dir (Hqrs.)/Ch(DT)/32(01)/2015/728 (31/07/2015)

In view of the RFD targets 2015-16 on reforming Tax administration, the CBDT has decided that once the Aayakar Sewa Kendras (ASK) are set up and become operational, their administration and control shall henceforth be vested with Pr. DGlT (Admn.) instead of Pr. DGIT (Logistics)....

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Preparation Strategy for CA Final Strategic Financial Management i.e. SFM. .!!

Hello Friends, first of all, thanks a lot for giving such a favorable response to article on 'Preparation Strategy for CA Final Financial Reporting. .!!' Now in the same manner I would like to throw light on preparation of very interesting subject of CA Final i.e. Strategic Financial Management. ...

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Indian Model of Goods & Service Tax (GST)

Indian Model Of GST:- Generally, GST consist three prime models:- 1. Central GST-(CGST) 2. States GST-(SGST) 3. Dual GST (i) Non concurrent dual GST (ii) Concurrent dual GST...

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Posted Under: CA, CS, CMA |

Applicability Of IND AS In India

Shruti Agrawal 1. Voluntary Adoption: Companies may voluntary adopt Ind AS for financial statements for accounting period beginning on or after 1st April 2015 with the comparatives for the periods ending 31st March 2015 or thereafter. If any company adopts the Ind AS then it will be required to follow i.e. there is no option […]...

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Posted Under: CA, CS, CMA |

No obligation to deduct TDS on amounts paid as reimbursement of expenses

CIT Vs DLF Commercial Project Corp (Delhi High Court)

Delhi High Court in the case of CIT vs. DLF Commercial Project Corp held that There is no obligation to deduct TDS on amounts paid as reimbursement of expenses because it do not have the character of income....

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No denial of refund on non-realisation of export proceeds

Whether refund of accumulated Cenvat credit filed under Rule 5 of the Cenvat Credit Rules, 2004 can be denied on the ground that the sales proceeds in respect of goods exported have not been realised by the Appellant?...

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Posted Under: CA, CS, CMA |

Applicability of Section 206AA in case of Non Resident

Section 206AA has been brought into Act from 1.4.2010. This section talks about furnishing of Permanent Account number (PAN) by any person entitled to receive any sum or income or amount on which tax is deductible under Chapter XVIIB. This provision cast a obligation on any person receiving an income to furnish PAN to deductor, failing on...

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Posted Under: CA, CS, CMA |

Procedure for Registration of Section 8 Company

Section 8 Company Introduction Section 8 Company is a Company licensed under Section 8 of the Companies Act, 2013 (the Act), erstwhile known as Section 25 Company under the Companies Act, 1956, which has main object; For promoting commerce, art, science, sports, education, research, social welfare, religion, charity, protection of environ...

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Posted Under: CA, CS, CMA |

At Least After Death, No Excise Duty – SC

Shabina Abraham & Ors. Vs Collector of Central Excise & Customs (Supreme Court of India)

Hon’ble Supreme Court in the case titled as Shabina Abraham & Ors. Vs. Collector of Central Excise & Custom in Civil Appeal No. 5802 of 2005 decided on 29.07.15 has held that assessment proceeding under the Central Excise and Salt Act, 1944 cannot be continued against the legal representative/estate of a sole proprietor/manufacturer aft...

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Comments on Disclosure of Interest by Directors

The disclosure of interest by a director is a statutory duty arising out of distinctive position held by him. Such position does pose some ambiguity. It is very well possible that in the first instance even a director may not be able to give a clear reply about his legal position....

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Posted Under: CA, CS, CMA |

Discipline- Without This, Our Life is Meaningless

Discipline refers to 'Orderliness, System and Code of behavior.' We can notice the discipline in our surrounding nature also. Animals and plants have discipline. Birds fly in flocks. Bees and Ants work as a team. The upper part of a plant grows towards the sunlight while the underground roots spread searching for water and nutrition....

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Posted Under: CA, CS, CMA |

Tax Benefits to Tourism Industry in India

The Tourism Industry has requested the Government of India for the following fiscal benefits including tax rebate and relaxations: i. Inclusion of tourism infrastructure like hotels/resorts/tourist lodges/banquet halls/convention and exhibition centres etc. for benefits of Section 32 AC of Income Tax Act 1961 by lowering the minimum thres...

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Posted Under: CA, CS, CMA |

Physical meeting of Commissioners not required u/s 86(2) of Finance Act, 1994

Commissioner of Service Tax Vs Japan Airlines International Co. Ltd. (Delhi High Court)

The Hon’ble High Court held that the Section 86(2) does not state as to the manner in which Committee of Commissioners have to arrive at a decision as to whether an appeal should be preferred against the order of Commissioner of Central Excise....

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Delhi reduces VAT Rates on Cutlery, Wax And Wood

F. 3(11)/Fin(Rev-I)/2015-16/ds-vi/599 (30/07/2015)

In the third Schedule appended to the Delhi Value Added Tax Act 2004 (Delhi Act 3 of 2005). (a) for the entry at SI. No. 6. the following entry shall he substituted, namely:-6. All utensils and cutlery items made of metals (including pressure cookers /pans) except those made of precious metals....

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Reopening despite submission of all facts in relation to deduction claimed by assessee during original assessment is impermissible

Capgemini India Pvt. Ltd. Vs Asst. Commissioner of Income Tax (Bombay High Court)

The Assessing Officer had issued notice u/s 148 of IT act to reopen the assessment of the AY 2007-08 giving reasons to believe that there was non-disclosure of all facts with respect to deduction u/s 10A by the assessee and the assessee had taken the deduction without setting off the loss of one unit....

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Composite Caps for Simplification of FDI policy to attract foreign investment

Press Note No. 8 (2015 Series) (30/07/2015)

In the sectors/activities as per Annexure, foreign investment up to the limit indicated against each sector/activity is allowed, subject to the conditions of the extant policy on specified sectors and applicable laws/regulations; security and other conditionalities. In sectors/activities not listed therein, foreign investment is permitted...

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Notification No. 40/2015-Central Excise, Dated-30th July, 2015

Notification No. 40/2015-Central Excise (30/07/2015)

(a) in the Explanation, for the figures, letters and words 1st day of October, 2015 the figures, letters and words 1st day of April, 2016 shall be substituted; (b) after the Explanation, for the TABLE, the following TABLE shall be substituted...

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Notification No. 42/2015-Customs, Dated-30th July, 2015

Notification No. 42/2015-Customs (30/07/2015)

Notification No. 42/2015-Customs Dated- 30th July, 2015 Central Government, on being satisfied that it is necessary in the public interest so to do, hereby makes the following further amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 39/96-Customs, dated the 23rd July, 1996, ...

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Notification No. 41/2015-Customs, Dated- 30th July, 2015

Notification No. 41/2015-Customs (30/07/2015)

Notification No. 41/2015-Customs, Dated- 30th July, 2015 Government being satisfied that it is necessary in the public interest so to do, hereby makes the following amendments in the notification of the Government of India in the Ministry of Finance (Department of Revenue) No. 49/2013-CUSTOMS, dated the 29th November, 2013, published in ...

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Delhi Tax Luxuries Act, 1996 (Turnover/receipt of a proprietor of hotels shall be 15% w.e.f 01.08.2015)

F. 12(2)/Fin(Rev-I)/2015-16/ds-vi/594 (30/07/2015)

Government of National Capital Territory of Delhi, hereby notifies that the rate of tax to be levied on the turnover of receipt of a proprietor of hotels shall be fifteen percent w.e.f. 1st August 2015....

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Press Release regarding Digital Signatures & Electronic Storage of Documents

As part of the Government’s initiative to facilitate trade, Central Board of Excise and Customs has been taking several steps towards ease of doing business. One such recent initiative has been to encourage the trade to replace paper documents required by law to be preserved with electronic documents and to use digitally signed invoices...

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Posted Under: CA, CS, CMA |

Yakub Memon Hanged today at Nagpur

Clarification- Some of our readers have objected to the use of Term Chartered Accountant (CA) for Late Yakub Abdul Razak Memon. The reason for their objection was that name of Late Yakub Abdul Razak Memon was removed from the Register of Members maintained by Institute of Chartered Accountant of India (ICAI)  in 1993, so at […]...

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Posted Under: CA, CS, CMA |

New Initiative in E-filing program- some testimonials from taxpayers

Taxpayers have appreciated the new initiative of Electronic Verification of the Income Tax Return through Aadhaar linkage and Net-banking and the testimonials affirm the user-friendliness and removal of the hassle of sending the paper copy of the ITR-V form to Bengaluru. Taxpayers have also reported that the process of e-verification shor...

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Posted Under: CA, CS, CMA |

Avail Benefit of Intermediate Default Communications and Avoid Intimations from CPC (TDS)

Deductor can  promptly avail the Online Correction facility at web-portal TRACES, after receipt of “potential PAN/ Challan errors in TDS statement” through Intermediate Defaults Communication. Your corrective action during the course of processing of Original TDS Statements helps you immensely in following ways: Avoid TDS Def...

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Posted Under: CA, CS, CMA |

Conversion of Private Limited or Unlisted Public Company into LLP and Taxability under Income Tax Act, 1961

CS Deepak Pratap Singh The Government of India has introduced various types of business structures for doing business. An entrepreneur can choose one from various business structures available according to their suitability. These are Proprietorship, Firm, AOP, One Person Company, Private Limited Companies, Public Limited Companies, Limit...

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Posted Under: CA, CS, CMA |

Development of Mechanism to Monitor Tendering by CAs

Tendering has been prohibited in the exclusive areas of practice of chartered accountants like audit and attestation services. i.e. those areas where the assignments can be performed only by chartered accountants. In those areas, where alongwith chartered accountants, the other professionals can also apply for the tender, there is no res...

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Posted Under: CA, CS, CMA |

How to pay Service Tax physically or online

An Assessee has to fill GAR-7 Challan [ Download GAR -7 Challan ] and payment can be made through bank. Now, the banker shall stamp the acknowledgement of GAR-7 with CIN- Customer Identification Number containing- BSR Code, Date of Deposit, Serial No of Challan, which can be the proof of tax payment....

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Posted Under: CA, CS, CMA |

Legality of Single Stage Taxation under the Punjab Value Added Tax Act, 2005

On 01-04-2005 Government of Punjab introduced Punjab Value Added Tax Act, 2005 (in PVAT Act, 2005) by abolishing the Punjab General Sales Tax Act, 1948. As the name suggests it’s a tax charged on portion of Value Addition at each stage. At each stage, tax calculated on sales (Outputs) and vendors are able to claim tax credits to recover...

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Posted Under: CA, CS, CMA |

CBDT notifies New ITR-3, ITR-4, ITR-5 ITR-6 & ITR -7 for A.Y. 2015-16

Notification No. 61/2015 - Income Tax (29/07/2015)

Notification No. 61/2015 - Income Tax In exercise of the powers conferred by section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-...

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Set Off of Losses or Carry Forward and Set Off of Losses

SET OFF OF LOSS FROM ONE SOURCE AGAINST INCOME FROM ANOTHER SOURCE UNDER THE SAME HEAD OF INCOME (INTER SOURCE). SET OFF OF LOSS FROM ONE HEAD AGAINST THE INCOME FROM ANOTHER (INTER HEAD) ...

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Posted Under: CA, CS, CMA |

Gift to be treated as genuine if identity of donors is genuine & source of gift stays explained

Prem Kumar Chowdhary Vs CIT (Income Tax Appellate Tribunal “B” Bench, Kolkata)

In the impugned year the blood relation is not necessary for the gift to be a genuine gift, but the relationship matters a lot. In all the probabilities the gift is found to be genuine as the donors have explained the source of gift, copy of bank accounts, income tax return. ...

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Factoring charges on sale cannot be termed as interest & not comes within the purview of section 2(28A)

M. Sons Gems N Jewellery Pvt. Ltd. Vs Addl. CIT (ITAT Delhi)

The Tribunal upheld the contention of the Assessee and also relied upon the judgment of the Hon’ble Calcutta High Court in the case of CIT vs. MKJ Enterprises which held that factoring charges were not interest and as such, provisions of TDS are not applicable....

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Standards On Auditing- Compilation Of Important SA’s

Why Auditing Standards are Important?? Auditing Standards are mandatory to be by followed by practitioners under the direction issued by the council of ICAI. If not complied with Auditing Standards in performing Assurance Engagement...

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Posted Under: CA, CS, CMA |

GST Rates – An Unresolved Issue- GST Knowledge Series-3

One of the crucial issue for successful implementation of GST relates to the determination of the GST rate. Since the GST is primarily intended as an exercise in reforming the consumption tax in India and not an exercise for additional resource mobilisation through discretionary changes, the CGST and SGST rates should be such rates which ...

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Posted Under: CA, CS, CMA |

TDS applicable on Karigar/ Embroidery charges but not on Purchase of Sarees

ITO Vs Shreejee Sarees Pvt. Ltd. (ITAT Kolkata)

The assessee is a dealer of sarees and AO while framing the assessment disallowed karigar /embroidery charges by invoking the provision of section 40(a)(ia) of the act for non-deduction of TDS u/s 194C of the Act....

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Let-out Commercial Property is not to be considered as Asset for Wealth Tax purposes

D.C.I.T. Vs M/s. Kothari Metals Ltd., (Kolkata ITAT)

The Assessing Officer while computing the total wealth of the assessee added the value of the let-out properties i.e. godown and offices in the total wealth of the assessee for the purpose of calculating the wealth-tax....

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All about Competition Act, 2002 – Part III

We have understood the concepts and some important definition under the Competition Act, 2002. As we have considered the charging provisions of Sections 3 and 4, we have learned that the main object of the act is to promote competition and restrict any activities by any entity or group of entities to restrict competition in the market....

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Posted Under: CA, CS, CMA |

Business claim allowable in the year in which it is incurred and not in the year of write off

M/s Nilgiri Cultivations Pvt. Ltd. Vs. DCIT (ITAT Delhi)

The assessee company was engaged in the business of real estate development. Vide order of Hon’ble High Court, 19 Group companies engaged in similar business were merged in the assessee company w.e.f 01.04.1999....

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Addition merely based on inference drawn from documents seized from third party is not valid

CIT, Delhi Vs Anil Khandelwal (High Court of Delhi)

The present case is related to search & seizure action carried out in case of Sh. S.K. Gupta (‘third party’) in respect of companies and other business entities which were controlled by him or owned by him or different individuals connected with him. ...

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Documents supporting a Transaction cannot be accepted as genuine where fundamental transaction is shown to be sham

CIT Vs Vishishth Chay Vyapar Ltd. (High Court of Delhi)

However, where the fundamental transaction is shown to be a sham transaction, the same cannot necessarily be accepted as genuine merely because a broker’s confirmation and invoices have been produced. Given the facts of this case, the decisions referred to by CIT(A) ...

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Section 154 can not be applied if a debatable point involved

Krishak Bharti Coop. Ltd. Vs CIT (Delhi High Court)

Mistake apparent on the record u/s 154 must be an obvious and patent mistake and not something which can be established by a long drawn process of reasoning on points on which there may be conceivably two opinions. ...

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Validity of summon order passed by trial court and criminal proceedings u/s 279(1) r.w. section 276D

Sharvan Gupta Vs ACIT (High Court of Delhi)

The petitioner by letter dated 17th November, 2011 had disclosed a foreign bank account which existed with the HSBC Private Bank, Geneva, Switzerland to the Director of Income Tax (Investigation-II). The peak amount lying in the said account during the year ending 31st March, 2007 was around US$ 1.3 million. ...

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Failure to supply reasons recorded by AO u/s 148 will make whole assessment proceedings void

M/s Jagat Talkies Vs DCIT, (ITAT Delhi)

It is an admitted fact, in the present case that the Department has failed to supply the assessee the copy of reasons recorded by the Assessing Officer for issuance of notice under Section 148 of the Act. Following the decision of Hon'ble Jurisdictional High Court in Haryana Acrylic Manufacturing Company, the issue was decided in favour o...

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Mere error would not confer jurisdiction to exercise revisional power U/s. 263

Shree Yogi Steels Pvt. Ltd Vs DCIT (ITAT Ahmedabad)

The condition precedent for exercising the revisional power under section 263 of the Act is that the order under revision should not only be erroneous, but such erroneous order should result in prejudice to the interests of the Revenue....

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Penalty u/s 271AAA not justified, if A.O. makes assessment on actual income disclosed u/s 132(4)

DCIT Vs M/s Evergreen Industries (P) Ltd., (ITAT Ahmedabad)

On this undisclosed income, A.O. vide penalty order, levied penalty of Rs.2.5 crore u/s 271AAA mainly for the reason of non disclosure of the particulars of income in the statement filed u/s 132(4) by the assessee. ...

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Onus to prove Third party documents found during search is on department

The ADIT Vs Smt. Jignaben Bipin Shah (ITAT Ahmedabad)

Document found during search was a third party document which was neither in the handwriting of the assessee nor bears her signature. Its inference has to be taken as stated by the person who possessed the document....

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Addition u/s 68 for mere high premium on issue of shares not valid

CIT Vs Anshika Consultants Pvt. Ltd. (High Court of Delhi)

Whether the assessee company charged a higher premium or not, should not have been the subject matter of the enquiry in the first instance Instead, the issue was whether the amount invested by the share applicants were from legitimate sources. ...

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If remand report given by AO is without any adverse comments then appeal of revenue would be dismissed

DCIT Vs Mohan Proteins Ltd, (ITAT Delhi)

ITAT held that CIT(A) had made detailed observations on the remand report of the AO who also in his report had not questioned any of the submissions made by assessee and in fact also had not made any adverse comments on the same....

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Transfer Pricing- Companies having abnormal cost cannot be taken as comparable

JCB India Limited Vs ACIT (ITAT Delhi)

Assessee had reduced its operating expenses to calculate ratio of operating profit/Total cost which was the base to calculate the value of export of goods in transfer pricing on the basis that it was its first year of operation ...

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In transfer pricing 2 companies can be compared only if they are functionally comparable

Xchanging Technologies Services India Pvt. Ltd. Vs ACIT (ITAT Delhi)

Assessee was engaged in the field of providing insurance & Human Resources services to its associated enterprise in UK. The Ld. AO /TPO made an addition to the income of the assessee by comparing the income of the assessee with the income of the comparable companies ...

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Provisions of Rule 8D applicable from A.Y. 2008-09 and is not retrospective

Shree Dinesh Mills Limited Vs ACIT (ITAT Ahmedabad)

AO had disallowed the expenses u/s 14A by applying the rule 8D for the A.Y 07-08 but the assessee argued and gave the supporting of the decided case law by Hon’ble High Court in its own decision in which it was decided that the sec 14A would be applicable from A.Y 08-09...

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Interest earned on idle funds raised through share capital for project establishment is capital receipt

ITO Vs M/s Factor Power Ltd,(ITAT Delhi)

ITAT Delhi has held in the case of ITO vs. M/s Factor Power Ltd that Interest Earned on Fund Raised Through Share Capital for installation of thermal power plant , which is been deposited temporarily in bank as fund were lying idle, with a motive to reduce the capital cost of thermal power plant ...

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SEBI issues list of 91 Companies in which investors are advised to not to invest

PR No. 194/2015- SEBI cautions investors not to invest in schemes offered by entities barred by SEBI from raising money or entities not registered with SEBI Certain Collective Investment Scheme(s) (CIS) have come to the notice of SEBI, which are offered by entities which are not registered with SEBI nor offer document of such schemes hav...

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Posted Under: CA, CS, CMA |

Notice for Empanelment of Prosecution Counsels

Applications are invited from advocates of substantial standing and repute and with good academic credentials for the empanelment of Prosecution Counsels for representing prosecution cases of the Income Tax Department in the Economic Offences Court or the appropriate court of Delhi in terms of Instruction No. 1925(F. No. 278113/88-ITJ Dat...

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Posted Under: CA, CS, CMA |

Timely Redressal of Tax Payer Grievances and Public Service Delivery

Grievance redressal is a major aspect of citizen centric governance and is an important feature of the activities of the Income Tax Department. The Central Action Plan 2015-16 of the Income Tax Department released during the Annual General Conference of senior officers held on 25-26 May 2015, has stressed on service delivery and timely gr...

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Posted Under: CA, CS, CMA |

Remarkable decision over tenders by ICAI but Clarification sought

I. Tendering has been prohibited in the exclusive areas of practice of chartered accountants like audit and attestation services. i.e. those areas where the assignments can be performed only by chartered accountants. II. In those areas, where along with chartered accountants, the other professionals can also apply for the tender, there i...

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Posted Under: CA, CS, CMA |

CA Practice- Be a Managing Director

A Chartered accountant in practice can also practice in corporate form. The Council permits a Chartered Accountant in practice to practice in Corporate Form also subject to compliance of Guidelines for Practice in Corporate Form. He can operate both the entities simultaneously. This is to empower the members to face the emerging challeng...

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Posted Under: CA, CS, CMA |

Preparation Strategy for CA Final Financial Reporting. .!!

Friends all of you are going to be a Chartered Accountant and a CA is supposed to be very much familiar with this subject at least. We are studying this subject from 11th standard and this is a subject in which you can secure the highest. ...

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Reimbursement of expenses from Service / Income tax perspective

Whenever we are appointing any professional (be it chartered accountant, lawyers, consultant etc) then in addition to payment of fees we also reimburse them expenses (like travel ticket cost, hotel bills, local conveyance etc) that has been incurred by them in the course of providing services. ...

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Posted Under: CA, CS, CMA |

SEBI cancels Registration of Sahara Mutual Fund

Press Release No. 193/2015 (28/07/2015)

ahara Mutual Fund/ Sahara Asset Management Company Private Limited (Sahara AMC) shall not take any new subscription from the investors (including existing investors in Systematic Investment Plans (SIP)/ Systematic Transfer Plans (STP). Further, the Sahara Mutual Fund shall not levy any penalties/ loads on the SIP/ STP investors for not de...

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Inclusion or non- inclusion of bought out items in the assessable value for payment of duty under Central Excise

In Union Budget for the year 2000-2001, the Finance Minister changed the valuation concept altogether. Before amendment in Sec. 4 valuation used to be done as per Normal Price basis but after amending the section “Transaction Value” has been taken as base for assessment purpose....

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Posted Under: CA, CS, CMA |

CCI Hyundai, Reva and Premier to be in Contravention of Competition Law

Competition Commission of India Finds Hyundai, Reva and Premier to be in Contravention of the Competition Law The Competition Commission of India (‘the Commission’), in its order dated 27.7.15 has found 3 Car Companies, namely, Hyundai Motor India Ltd. (Hyundai), Mahindra Reva Electric Car Company (P) Ltd. (Reva) and Premier Ltd. (Pre...

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Posted Under: CA, CS, CMA |

Theoretical Gist on SA 700, 705, 706

SA 700 (Revised) FORMING AN OPINION AND REPORTING ON FINANCIAL STATEMENTS. SA 705 MODIFICATIONS TO THE OPINION IN THE INDEPENDENT AUDITOR’S REPORT. SA 706 EMPHASIS OF MATTER PARAGRAPHS AND OTHER MATTER PARAGRAPHS IN THE INDEPENDENT AUDITOR’S REPORT...

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Posted Under: CA, CS, CMA |

Department cannot take different view on same issue in absence of change in facts

CIT Vs Om Prakash Khaitan (Delhi High Court)

The Hon’ble Delhi High Court in the case of CIT vs. Om Prakash Khaitan held that In the absence of change in system of accounting consistently followed by the assessee and accepted by the department, the department cannot take different stand for the subsequent years....

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Sec. 9(1)(vii) Commission for procuring order & recovering payments is not a Technical services

ACIT, Kanpur Vs M/s Northern Tannery (ITAT Lucknow)

ITAT Lucknow in the case of ACIT vs. M/s Northern Tannery held that The commission paid to the non- resident agent for procuring order and recovering payments on the behalf of assessee could not be treated ...

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Refund of excise and custom duties on Purchase of Raw Material and Capital Equipment used in Capital WIP is Capital Receipt

CIT Vs Maithon Power Ltd (Delhi High Court)

Delhi High Court in the case of Maithon Power Ltd. vs. CIT held that The expenditure incurred to set up operations forms the part of capital work in progress and thus, the subsequent reimbursement of any part thereof would be a capital receipt which will get reduced from the amount capitalized under the capital WIP. ...

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Empanelment of CA Firms with SFIO

Serious Fraud Investigation Office (SFIO) invites applications from eligible Chartered Accountant Firms for empanelment to take up assignments relating to forensic audit, analysis of financial data, interpretation of financial statements etc. in connection with investigations under the provisions of Companies Act, 2013....

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Posted Under: CA, CS, CMA |

Income from subletting of property is to be assessed as business income

Bhuvan Leasing and Infrastructures  Vs ITO (ITAT Mumbai)

In the case of Bhuvan Leasing and Infrastructures Vs ITO, ITAT Mumbai has held that where it is the intention of the assessee to lease out various premises and then sublet the same on leave and licence basis to different parties...

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Deduction u/s 80IA(4) cannot be disallowed, merely on the ground that assessee is not the owner of infrastructure facilities

En-Vision Enviro Engineers (P) Ltd. Vs DCIT (ITAT Ahmedabad)

In the case of En-Vision Enviro Engineers (P) Ltd. Vs DCIT, it was held that deduction u/s 80IA(4) cannot be disallowed, merely on the ground that the assessee must be owner of the infrastructure facilities and the assess should be a developer and not contractor....

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Welfare bodies formed under state statute eligible for registration u/s 12AA despite charging fees for their services

Pune District Security Guards Board Vs CIT (ITAT Pune)

In the case of Pune District Security Guards Board vs CIT, ITAT Pune held that welfare bodies formed under Maharashtra Private Security Guards (Regulation of Employment and Welfare) Act, 1981 were eligible for registration under section 12AA even though they charge fee for their services....

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Onus is on assessee to prove identity / creditworthiness of creditors & genuineness of transactions

Xerces Technologies Pvt. Ltd. Vs DCIT (ITAT Pune)

In the case of Xerces Technologies Pvt. Ltd. Vs DCIT, ITAT Pune held that assessee to prove the identity of the creditors, their creditworthiness and the genuineness of the transactions. Mere furnishing of the particulars is not enough....

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If provisions of section 14A is to be invoked, disallowance is to be computed as per rule 8D

Assistant Commissioner of Income Tax, Bareilly Vs M/s.Goel Investments Ltd., (ITAT Lucknow)

In the case of ACIT vs M/s.Goel Investments Ltd., ITAT Lucknow affirmed the earlier order of ITAT in a similar case of the same assessee that once provisions of section 14A of the IT Act are to be invoked, the disallowance is to be computed as per rule 8D of the IT rules....

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Monopoly, continuous functioning and large orders at hand are sufficient basis for valuation of goodwill

Commissioner of Income Tax Vs M/s. Motherson Auto P. Ltd. (Delhi High Court)

In the case of CIT vs M/s.Motherson Auto P. Ltd, Delhi High Court held that the monopoly enjoyed by the assessee in respect of the product manufactured, the continuous functioning, the large volume of orders at hand when the collaboration transaction took place, were sufficient basis for valuation....

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Rent cannot be increased for mere increase in prices of land

M/s Resinova Chemie Ltd vs Assistant Commissioner of Income Tax, (ITAT Lucknow)

In the cited case, ITAT inter-alia held that merely because prices of land has gone up, rent cannot be increased particularly to persons covered u/s 40A(2)(b) of the I.T Act without looking into agreement in respect of rent for the earlier years and for the present year...

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Bonds, that mature in future, issued against services provided for a project, does not convert them into capital assets

IRCON International Ltd. Vs Deputy Commissioner of Income Tax (Delhi High Court)

In the cited case, Delhi High Court held that the Iraqi Government’s inability to pay due to sanctions imposed by it and the subsequent Central Government’s negotiating an arrangement for its payment through bonds that were to mature in future with interest did not in any way alter their character ...

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Job worker should be considered as manufacturer subject to arrangement between parties- SC

Commissioner of Central Excise, Goa Vs M/s. Cosme Farma Laboratories Ltd. (Supreme Court of India)

In the case of Commissioner of Central Excise, Goa V/s. M/s Cosme Farma Laboratories Ltd., it has been held by the Hon’ble Supreme Court of India that in case of job work arrangement, the job worker should be considered as manufacturer on the basis of the arrangement ...

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Adverse Statement of Witness cannot be relied by AO without giving assessee an opportunity to cross examine

M/s R.W. Promotions P. Ltd Vs Assistant Commissioner of Income Tax (Bombay High Court)

In the case of /s R.W. Promotions P. Ltd vs. ACIT Bombay High Court held that AO must gives an opportunity to cross examine the witnesses whose statement is relied upon by the revenue , violation of this right is clearly a breach of principles of natural justice....

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Eligibility criteria in an exemption notification required to be construed strictly- SC

M/s. IVRCL Infrastructure & Projects Ltd. Vs Commissioner of Customs (Supreme Court of India)

The appellant entered into a Joint Venture Agreement with M/s Shapoorji Pallonji & Company Limited for the purpose of construction of roads in the State of Andhra Pradesh. The Joint Venture was awarded a contract ...

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Value of post-import services can be added to assessable value under customs only when such service is a condition of sale – SC

Commissioner of Customs, Ahmedabad Vs M/s. Essar Steel Ltd. (Supreme Court of India)

An agreement was entered into between the respondent and Met Chem Canada Inc. to associate Met Chem Canada Inc. as a technical consultant to render technical services in relation to implementation of a project to set up a plant in India for production of Hot Rolled Steel Coils and Strips....

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Same line of business in same area is reliable in estimation of profit in best judgement assessment

ITO Vs M/s Apex Goods Pvt. Ltd. (Kolkata ITAT)

The assessee-company is a Civil Contractor as well as trading in sarees and fabrics. The assessee-company filed its return of income on 28-09-2008 declaring total income at Rs.3,07,285/-. As noted by AO, the assessee could not produce the books of account and supporting bills and vouchers....

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Indian Financial Code, 2015 – what is this new buzz !!!

a) Vide a press release dated 23-July-2015[1], the Ministry of Finance has put the revised (so when did the original came, can’t remember ? even I did not) draft of the bill i.e. proposed the Indian Financial Code, 2015 into public domain for comments / suggestions. Before we understand the basics, let’s put in context […]...

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Posted Under: CA, CS, CMA |

Amendment in export policy of sawn timber – addition of ports for export to Nepal

Notification No. 16/2015-2020 (28/07/2015)

Export of sawn timber to Nepal made exclusively out of imported wood logs through the port of Kolkata has been permitted from the Land Customs Station (LCS) of Raxaul....

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Value At Risk (VaR): Methodology for Measuring Financial Risk

In everyday life all of us are taking some amount of risk. Similarly a business also contains risk. Risk is the unexpected variability of asset prices and / or earnings. So risk is basically volatility and not necessarily loss. There are major two sources of risk 1) Business Risk 2) Financial Risk ...

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Posted Under: CA, CS, CMA |

MCA initiatives and salient achievements in the last six months

Ministry of Corporate Affairs initiatives and salient achievements in the last six months- Dated- July 28, 2015 The mandate of the Ministry of Corporate Affairs primarily concerns administration of the legal framework within which companies registered in India are to operate along with some other connected matters. Within this mandate rap...

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Posted Under: CA, CS, CMA |

Levy of Penalty & Factors affecting Levy of Penalty including Nature of Offence, Mens Rea & Bona fide belief

Longstanding and never ending has been the debate regarding what is penalty and whether mens rea is an essential ingredient in levy of penalty or bonafide belief that what was being done was correct would hold good and save the offender from penalty. Over the years the law has evolved and Courts of Law have tried to lay down a law providi...

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Posted Under: CA, CS, CMA |

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