Follow Us :

Archive: 14 September 2017

Posts in 14 September 2017

Live Course on Appeal, Pleading & Drafting under GST by CA Sachin Jain

May 15, 2024 6717 Views 0 comment Print

oin us for an immersive live course led by renowned expert CA Sachin Jain, as we delve into the intricacies of appeal, pleading, and drafting under GST.

GST On Local Cable Operators (LCOs)

September 14, 2017 97371 Views 22 comments Print

Entertainment is a big part of our daily lifestyle. Cable TV is the most easily available and play a vital role in our life . Under the Old Tax System indirect tax system like Entertainment Tax, VAT, CST are levied by state Govt, and the Tax rates ranges from 15% to 110%. Central Govt imposed Service Tax on big cable TV operators and broadcaster who’s annual turnover is more then 10Lac. The Tax on Local Cable Operators (LCOs) was introduced in erstwhile Service Tax laws. Service tax on Local Cable Operators (LCOs) is implemented on w.e.f. 24.02.2009. The service tax currently (pre-GST) is 15%. The Goods and Services Tax (GST) would be a very significant step in the field of indirect tax reforms in India. By amalgamating a number of Central and State taxes into a single tax (GST). Now, GST implemented on 1st July 2017. Taxation on entertainment, cable and DTH services shall come down under the Goods and Services Tax regime as the entertainment tax levied by states has been subsumed in the GST. 18% GST is imposed on cable tv operators. The taxable supplies by LCO under the cable TV industry is liable of taxable 18% GST. Definition and scope of service: “Cable Operator” shall have the meaning assigned to it in clause (aa) of Section 2 of the Cable Television Networks (Regulation) Act, 1995 (7 of 1995); (Section 65(21) of the Finance Act, 1944) “Taxable Service” means any service provided or to be provided to any person, to any person, by a cable operator including a multisystem operator in relation to cable services; (Section 65 (105) (zs) of the Finance Act, 1994). Local Cable Operator (LOC) required to get registered? All the Existing Taxable Person, already registered under state govt Entertainment Tax are compulsory migrated to GST. Section 24 of CGST Act, 2017 explains Compulsory registration in certain cases If a person supplies taxable supply of goods/services 1. Inter-State Suppliers 2. Casual Taxable Person 3. Reverse Charge 4. Non-Resident Taxable Person 5. TDS deductor u/s 37 6. Agents 7. Input Service Distributor 8. Every Electronic Commerce Operator 9. Aggregator 10. Such other person as may be notified by Central/State Government on the recommendations of the GST Council. GST on Local Cable Operators LCO’s Taxable Supplies : 1. Taxable Sale/Service (Outward supply) by LCO’s: (a) Supply of Cable TV package to end user (customers) (b) Supply of Set-top box (STB) and Installation Charges (c) Repair of STB (d) Supply of Broadband package (e) Other related supply made for the provision of Cable TV / Broadband package (a) Supply of Cable TV package to end user (customers) : Cable broadcasting service is Taxable Supplies under GST, 18% GST will be charged depending upon the location of recipient of services i.e. Customer. Local Cable Operator makes a supply of Cable TV to an individual un-registered subscriber ie customer. Since the supply is made to an un-registered person, the LCO will issue a taxable invoice to subscriber. If the individual is a registered person, then the LCO will issue a taxable invoice to the subscriber. On the basis of taxable invoice, individual will claim the credit of GST. (b) Supply of Set-top box (STB) and Installation Charges : STBs are generally supplied to customers on activation basis. Customer activate STBs in his name on payment of activation charges from LOC. GST will be paid @ 18% on activation revenue collected by LCO from end-customers. MSO will also charge GST @ 18% on the STB activation charges from LCOs. LCOs will take the ITC credit of GST paid on the activation charges. Ownership of STB will always lie with the MSO since the box is not sold to LCOs. LCOs cannot sell the STB to the customer. They can provide the same on activation only. (c) Repair of STB STB repair charges collected from customers. If STB repair charges are paid to registered vendor/person, LCO will claim the GST @18% Input tax credit on the invoice issued by the vendor. If the STB repair charges are paid to unregistered vendor/person, LCOs will be liable to pay GST under reverse charge mechanism. LCO has to pay GST under Reverse charge and the same will be available as Input tax credit (ITC). (d) Supply of Broadband package or Other related supply made for the provision of Cable TV / Broadband package Supply of Broadband Services to the end user, LCO also acts as authorised Broadband agents for the internet service provider (ISP) company. The ISP may be an existing MSO, for whom the LCO is already working or may be a different ISP company. LCO collects and remits the amount collected from end user customers to Broadband services to the ISP company. LCO will claim the GST @18% Input tax credit on the invoice issued by ISP company/MSO. 2. Taxable purchases (Inward Supply) by the LCO’s: (a) Channels subscription Fee by MSO (b) STB Purchase from Vendors (c) STB activation charges paid to MSO (d) STB repair charges paid to Vendor (e) Cable Network items Purchase from Vendors (f) Office Rent Local Cable Operators LCO’s purchase/received Inward Taxable Supply from various Suppliers under GST also get input tax credit on purchase/inward supplies/channels subscription fee paid by LCO. Availability of ITC for Local Cable Operators on purchase/received Inward Taxable Supply from various Suppliers/vendors. ITC for Local Cable Operators will now be available on the purchase /Service received (Inward Taxable Supply) like Channels subscription Fee by MSO, STB Purchase from Vendors, STB activation charges paid to MSO, STB repair charges paid to Vendor, Cable Network items components Purchase from Vendors and Office Rent paid to the owner of the premise. Which were not available under the pre-GST regime. So, the input GST paid when renting a premise can be adjusted with the output GST from selling cable tv broadcasting service by local cable operator. In this case Local cable operator needs to be registered with GSTN, because he is working as an agent of other taxable person i.e. Broadcasting/Broadband Company. Local Cable Operators LCO’s have to Register for GST even if their total taxable revenue is less than the Rs 20lakh/ Rs 10lakh threshold limit. Local cable operator (LCOs) are selling the cable TV entertainment packages to the end users ie Customers. End users/Customers can only be viewed the channels/Cable TV with the help of Set Top Box (STB) through the supply of signal by cable network, This network is controlled, managed and serviced by Local cable operator (LOC), and this cable network is directly owned, controlled and provided by the MSO. This is taxable under Section 24, Clause (vii) of CGST Act, 2017, Compulsory registration in certain cases. Every Local cable operator LCO has to register under GST. Even if the LCO is managing only one Cable TV connection, he is liable to get registered under GST. LCO is taxable under Section 24, Clause (vii) of CGST Act, 2017, Compulsory registration in certain cases. Section 24 of CGST Act, 2017 explains Compulsory registration in certain cases as follows : The extract of Section 24 of CGST Act,2017 quoted below 24. Notwithstanding anything contained in sub-section (1) of section 22, the following categories of persons shall be required to be registered under this Act – (i) persons making any inter-State taxable supply; (ii) Compulsory registration in certain cases Section 24 of CGST Act, 2017(ii) casual taxable persons making taxable supply; (iii) persons who are required to pay tax under reverse charge; (iv) person who are required to pay tax under sub-section (5) of section 9; (v) non-resident taxable persons making taxable supply; (vi) persons who are required to deduct tax under section 51, whether or not separately registered under this Act; (vii) persons who make taxable supply of goods or services or both on behalf of other taxable persons whether as an agent or otherwise; (viii) Input Service Distributor, whether or not separately registered under this Act; (ix) persons who supply goods or services or both, other than supplies specified under sub-section (5) of section 9, through such electronic commerce operator who is required to collect tax at source under section 52; (x) every electronic commerce operator; (xi) every person supplying online information and data base access or retrieval services from a place outside India to a person in India, other than a registered person; and (xii) such other person or class of persons as may be notified by the Government on the recommendations of the Council. The above information clarifies about Compulsory registration in certain cases under section 24 of CGST Act,2017. Conclusion : Every Local cable operator LCO has to register under GST. Even if the LCO is managing only one Cable TV connection, he is liable to get registered under GST and paid the GST @18% collected from end user ie customer. LCO is taxable under Section 24, Clause (vii) of CGST Act, 2017, Compulsory registration in certain cases. As per Section 24, Clause (vii) of CGST Act, 2017 persons who make taxable supply of goods or services or both on behalf of other taxable persons whether as an agent or otherwise. Author Details : Ashish kamthania, Advocate, BSc, BEd, PGDCA, LL.B., LL.M. Director: Tax & Legal Professional Private Limited Contact at : [email protected] https://www.facebook.com/kamthania

Transaction with related persons – GST impact

September 14, 2017 35235 Views 1 comment Print

The transaction with related persons has been a special area of consideration for government and tax authorities on the assumption that the transaction may be motivated by something more than earning the profit. GST has introduced certain provisions that will affect the related party transaction of the business owner.

CA FINAL & IPCE Exams : Final Gameplan

September 14, 2017 3651 Views 0 comment Print

With almost one and half months left for the upcoming exams, students are yet in dilemma of whether to appear for both groups or appear only one group. Students are struggling with planning their studies and are not sure if their plan will materialize effectively. What is required required at this stage?….A thorough Self analysis about where are we really standing & what are the goals that we desire to achieve

ITAT Section 54EC exemption for Investing in REC Bonds of Rs.50 Lakh each in 2 Financial Years for A.Y. prior to 2015-16

September 14, 2017 3936 Views 0 comment Print

Government only intended to restrict the investment in a particular financial year and accordingly has fixed the limit of Rs. 50,00,000/- as permissible limit in a particular financial year. The Government did not intend to restrict the maximum amount of exemption permissible under Section 54EC.

Tax Exemption cannot be denied to Trust not meant for one particular religious community

September 14, 2017 1617 Views 0 comment Print

It has been found that the activities of the Assessee Society, though both religious and charitable, were not exclusively meant for one particular religious community. It was, therefore, rightly not denied exemption under Section 11 of the Act.

Section 11 exemption cannot be denied for receipt of fees from non-members

September 14, 2017 717 Views 0 comment Print

Assessee is an association of professional and businessman to protect and promote the interest of its members. The income of the assessee is from membership fees from its members, specialized services, services and facilities, meetings, seminars and training programmes, sale of publication etc. It is also noted that the income of the assessee from other […]

Sec. 153C Seized incriminating materials should belong to person other than the person referred to in Section 153A

September 14, 2017 2313 Views 0 comment Print

Gujarat High Court in the  case of  Kamleshbhai Dharamshibhai Patel v. Commissioner of Income Tax-III, (2013) 31 taxmann.com 50 (Gujarat)  has categorically held that it is an essential condition precedent that any money, bullion or jewellery or other valuable articles or thing or books of accounts or documents seized or requisitioned should belong to a […]

Catchy learning regarding incorporation of company

September 14, 2017 1383 Views 3 comments Print

For the beginners who want to incorporate the company, can easily with the help of this article incorporate a private company. Starting from the filing form INC-1 ( reservation of name of the company), Spice form 32, Spice form 33 (MOA), Spice form 34 (AOA). There is a short list of the FORMS required to be filed during incorporation and includes what kind of information required to be filed.

MACS to adopt Secretarial Standards issued by ICSI as benchmark

September 14, 2017 564 Views 0 comment Print

Malaysian Association of Company Secretaries (MACS) to adopt the Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI) as the benchmark.

MOU between MCA & CBDT for Automatic & Regular Information Exchange

September 14, 2017 1641 Views 0 comment Print

Taking forward the initiative launched by the Government of India to curb the menace of shell companies, money laundering and black money in the country and prevent misuse of corporate structure by shell companies for various illegal purposes, the Ministry of Corporate Affairs and Central Board of Direct Taxes (CBDT) have now concluded a formal Memorandum of Understanding (MoU) for data exchange, on 6th September, 2017.

Search Post by Date
May 2024
M T W T F S S
 12345
6789101112
13141516171819
20212223242526
2728293031