"18 March 2019" Archive

Provisions of GST Effective From 1st April 2019

Article discusses changes in 1. GST Provisions related to Threshold Limit for Registration in case of goods , Services and Both Goods & Services 2. Changes in GST Composition Scheme 3. Supply with or without consideration – treated as supply under GST, Changes in TCS Provisions and 4. Proposed New GST Return Formats....

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Notification dated 5th March 2019 by CBDT on Angel Tax, Icing on cake

As per current Income Tax provisions, if a closely-held company i.e. a company in which public is not substantially interested, issues shares at a price which is more than its fair market value (FMV), then the excess amount i.e. excess of issue price over fair market value will be taxed as income from other sources in the hands of the com...

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ESOPs Holding period to be from date of grant not from date of vesting

Shri. N. R. Ravikrishnan Vs ACIT (ITAT Bangalore)

Period of holding ESOP options transferred by the assessee in course of buy-back scheme of his employer was to be counted from the date of grant of ESOP option and date of vesting was not relevant as options were transferred without any exercise....

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Last Minute Tax Saving Options

As we are in the mid of March which is last month of the financial year, many of us are concerned as to where and how much to invest to save tax. As one can claim a set limit deduction from his / her income under the Income Tax Act, one must be very careful […]...

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GST Provisions Related to Information Technology Sector

Following write-up summarises the GST provisions as applicable to IT/ITES sector. 1. Goods or Services: Though GST is applicable to both goods or services, it is necessary to determine as to whether the impugned supply is ‘supply of goods’ or ‘supply of services’ and all machinery provisions of GST law differentiat...

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Conversion of Unlimited Liability Company into a Limited Liability Company by Shares or Guarantee

Conversion of Unlimited Liability Company into a Limited Liability Company by Shares or Guarantee Under Companies Act, 2013 1) Without prejudice to any other provision in the Companies Act for effecting the conversion of an unlimited liability company with or without share capital into limited liability Company by shares or guarantee, suc...

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An Overview with respect to Real Estate (Regulation & Development) Act, 2016 (Rajasthan)

Government of India has enacted the Real Estate (Regulation and Development) Act 2016 and all the provisions of the Act have came into force with effect from May 1, 2017. Under this Act, Government of Rajasthan has notified the Rules namely Rajasthan Real Estate (Regulation and Development) Rules, 2017. The State Government, vide its Orde...

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GST and Statutory Compliance under Dropshipping business

1) What exactly is the Business Model of Dropshipping ? The business model is some what like a middle man between the supplier and prospective customer. But in this neither the supplier or Seller knows about each other. In this Supply Chain Management System the Consignor who carried out the sale through his Website/App never […]...

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Why to choose ELSS as your tax saving Instrument

It is last few days to save tax. It’s time to submit investment proof, please do not confuse yourself with wrong choice of Investments. I would recommend ELSS as tax saving instrument because of following reasons- Lowest lock-in period When you make any investment, the next thought is how and when you will be able […]...

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Indian GAAP – Time to converge to Ind AS

Indian GAAP: A show stopper in achieving the overall objective of comparability and acceptability of Indian Financial Statements In India, we have two different framework for preparing financials statements: 1. Indian GAAP (IGAAP) 2. Indian Accounting Standards (Ind AS) Ind AS is applicable to companies having net worth more than INR 250 ...

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GST, Income Tax, Company Law, LLP Compliance Book 2019

As you know, our profession is growing exponentially and the main reason is change. Today we are seeing amendments and modifications in almost all laws and are at a stage where we have to transform our thought process and discover new ways of performance. It is time for us to see that clients see value […]...

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Deduction for Removal of Encumbrance U/s 48(1) of Income Tax Act

Introduction: Computation of Capital gain has always been a complex provision under the Income-tax Act. New controversies are created dime a dozen merely because the amounts involved are usually large in case of capital gain assessments.  A controversy arises where the purchaser of the land makes payment to seller for the land and furthe...

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Entities into which FDI can be made

For a country where capital is not readily available, Foreign Direct Investment (FDI) has been an important source of funds for entities. I would like to share my views on entities into which FDI can be done. ENTITIES INTO WHICH FDI CAN BE MADE 1. Partnership Firm / Proprietary Concern 2. Venture Capital Fund 3. […]...

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Where to Keep Books of Accounts of Company?

In most of the cases directors of the company are in view that the Books of Accounts are to be kept at registered office of the company since mostly a promoter of start-ups Incorporate a Company using its own residential address as a Registered Office address and then start a business on rented premises. This […]...

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No addition for duly explained Past Savings Kept in Locker

Shri Dinesh Goswami Vs DCIT (ITAT Indore)

Shri Dinesh Goswami Vs DCIT (ITAT Indore) When Source of Income Fully Explained Past Savings Kept in Locker is Justifiable in Law FACTS – Search was carried out on 30.11.2012 on the premises of assessee. Notice u/s 153A was issued to assessee to file return for AY 2007-08 to AY 2012-13. During the search cash […]...

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Erroneous TDS claim not authorise AO to bring professional receipts to tax

Dhruv Sachdeva Vs ACIT (ITAT Delhi)

Where assessee had erroneously taken credit for prepaid taxes on account of gross professional receipts as per Form 26AS ; then having regard to Rule 37BA, Revenue would be justified in denying credit for such amount of prepaid taxes which were not assessable during the year on the basis of regular method of accounting followed by the ass...

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Section 40(a)(ia) can’t be invoked in absence of amount claimed as expenditure

CIT Vs M/s Dedicated Healthcare Services (TPA) India Pvt. (Bombay High Court)

Section 40(a)(ia) can be applied only when amount sought to be disallowed has been claimed as an expenditure/deduction. In absence of the amount having been claimed as expenditure while determining the income, dis allowance would not be attracted....

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Applicability of transfer pricing provisions to investment made on capital account

Pr. CIT Vs PMP Auto Components Pvt. Ltd (Bombay High Court)

Transfer Pricing provisions on shares purchased at value in excess of FMV was not applicable as the same could only be invoked to bring to tax any income arising from an international transaction....

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Prosecution proceedings justified on failure to disclose foreign bank accounts under Black Money and Imposition of Tax Act, 2015

Shrivardhan Mohta Vs Union of India (Calcutta High Court)

Where assessee was given an opportunity to make the disclosure with regard to foreign bank accounts and the amount lying thereat however assessee failed to avail the  opportunity to make disclosure with regard thereto while submitting his return in the proceedings under search and seizure and also before Settlement Commission, the author...

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Recent Developments in GST on Real Estate

The 33rd meeting of GST Council was held on 20.02.2019 which was later adjourned to 24.02.2019.  In a major move, GST Council recommended a much needed breather to real estate sector so much so that it would be beneficial to both – builders-developers as well as buyers and this sector, already reeling under slow down / recession will b...

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Bogus Purchase: AO cannot ignore PAN, VAT Returns without any inquiry at his end

DCIT Vs. PES Installations Pvt. Ltd. (ITAT Delhi)

DCIT Vs. PES Installations Pvt. Ltd. (ITAT Delhi) In paper book filed before us at page 222, copy of remand report has been placed. Ld. AO observed therein that, mere filing PAN numbers or assessment particulars, VAT returns and copy of sales tax RC etc., do not establish identity of persons. He further notes that actual and true [&hel...

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Assessment U/s. 153C without recording of satisfaction by AO of searched person is bad in law

Salasar Dwellers Pvt. Ltd. Vs DCIT (ITAT Mumbai)

Salasar Dwellers Pvt. Ltd. Vs DCIT (ITAT Mumbai) Satisfaction in the case is not recorded by the AO of the searched party, which is a pre-condition for invoking jurisdiction u/s 153C of the Act and hence, the assessment framed u/s 153C read with Section u/s 143(3) of the Act is bad in law and hence, […]...

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Post Supply discount other than those covered by section 15(3) to be treated as non-payment

There had been various contentions relating to post-supply discounts/incentives/rebates being given by the supplier to its customer. There are whole lot of transactions such as quantity based discounts, cash discounts, price adjustment etc. which have raised the complexity regarding levy of GST revolving around discount provisions. The wr...

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Section 10AA: Loss from eligible units can be set off against normal business income

DCIT (LTU) Vs Avtec Ltd. (ITAT Delhi)

DCIT Vs Avtec Ltd. (ITAT Delhi) Deduction prescribed under section 10AA cannot be treated in the nature of exemption and as such, loss suffered by assessee in its unit eligible for deduction under section 10AA could be set off against normal business income. Keeping in view the fact that section 10AA makes the assessee eligible […]...

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GST Audit Fee: Business Houses And Auditors

ON A HALF TRUTH: ONLY RECONCILIATION IS TO BE PREPARED BY THE GST AUDITOR Post reading this article one will appreciate that how an efficient audit can be a value addition tool to the business houses. Depth of procedures of auditors will lead to safeguard the registered person from facing the same issues in assessment. […]...

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Employee Stock Option Plan for an Unlisted Company

CA Gourav Goyal Brief about Employee Stock Option Plan (ESOP) Employee Stock Option Plan (ESOP) is a frequently used incentive mechanism used by organizations. There are various reasons for which the employees of a company are given such stock options. The phenomena of stock options is more prevalent in start-up companies which cannot aff...

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All about FCRA Registration, Prior permission, Eligibility & Compliance requirements

The FCRA was enacted with the primary purpose of regulating the inflow of foreign contributions and ensuring that the received foreign contributions are not utilized for illegal purposes. All charitable organizations in India receiving foreign contributions come under the purview of this Act. Over the last few years, the Home Ministry has...

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Addition justified if creditworthiness of parties & genuineness of transaction not established

Ms Shree Krishana Kripa Feeds Vs CIT (High Court Punjab & Hariyana)

Hon'ble High Court held that  addition on account of undisclosed income is sustainable where creditworthiness of parties and genuineness of transaction was not established by assessee....

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Addition invalid when no incriminating material was unearthed during search

ACIT Vs Varun Beverages Ltd. (ITAT Delhi)

Addition in respect of completed assessments u/s 153A be made solely on the basis of post search enquiry when no incriminating material was unearthed during search is not valid. ...

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Another Step by Ministry to Track Shell Companies

Another step has been taken by ministry for tracking shell companies and vanishing companies by introduction of E-Form ACTIVE (INC-22A).As the expansion of ACTIVE itself defines Active Company Tagging Identities and Verification, Ministry, through this e-form, has asked companies to geo-tag its registered office location and share the dat...

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HC on threatening of assessee by DCIT despite admission of Appeal by HC

Deepak Fertilizers And Petrochemicals Corporation Limited Vs Addl CIT (Bombay High Court)

Deepak Fertilizers And Petrochemicals Corporation Limited Vs Add. CIT (Bombay High Court) HC held that we do not think that there is any justification for the Deputy Commissioner of Income Tax, Central Circle ­8(1) to threaten the appellant/applicant with any prosecution. Even if such prosecution  under section 276C is launched, the sam...

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Stepping up of preventive vigilance mechanism by CBIC field formations during the 17th Lok Sabha election process — reg

Instruction No. 01/2019-Customs (18/03/2019)

All the formations and officers under your jurisdiction should be duly sensitised to step up the preventive vigilance mechanism to rule out illicit movement of currency and commodities;Suitable directions may be given to the formations and officers under your jurisdiction to conduct effective checking and surveillance during the election ...

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Clarification on participation of EFIs in Commodity Derivatives in IFSC

SEBI/HO/MRD/DRMNP/CIR/P/2019/39 (18/03/2019)

EFIs may participate in commodity derivatives contracts traded in stock exchanges in IFSC subject to the following conditions:-2.1. The participation would be limited to the derivatives contracts in non-agricultural commodities only,2.2. Contracts would be cash settled on the settlement price determined on overseas exchanges, and2.3. All ...

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Process for filing online Application for export authorisation of restricted items (Non-SCOM ET)

Trade Notice No. 50/2018-2019-DGFT (18/03/2019)

To avoid any delay in grant of export authorizations, it has been decided that w.e.f. 01.04.2019, export authorizations for Restricted items (Non-SCOMET ) shall be issued by the Export Cell, DGFT (Hqrs). The authorizations shall be issued under the signature of FTDO (Non-SCOMET) or any other official designated for the purpose....

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Deputation of Indian Experts to Maldives in areas of financial crime, fraud investigation and money laundering -reg

Notification No. 15011/06/2019-IC (ICD) (18/03/2019)

Central Board of Indirect Tax and Customs is in the process of drawing a penal of Experts in the area of Financial Crime and Fraud Investigation, Money Laundering and Preventing Corruption for posting in the Maldives. The tenure of deputation is for one year....

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Houses For Sell In India

‘Home is not just a property – it’s an emotion’, the second you step into one, it becomes a part of you, it determines your mood, your lifestyle, the time you take to get to work or school etc… So, for most people buying or renting a home is not an easy task – it […]...

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Carry bags/re-usable shopping bags of cotton falls under HSN 4202: AAAR

In re Mrs. Senthilkumar Thilagavathy (M/s. JVS Tex) (GST AAAR Tamilnadu)

In re Mrs. Senthilkumar Thilagavathy (M/s. JVS Tex) (GST AAAR Tamilnadu) The above clarification by the Board in the context of the adoption of HS classification in Customs and the duty drawback clearly provides that the bags (handbags/shopping bags) made of cotton are squarely classifiable under Chapter heading 4202 of the Customs Tariff...

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Changes in CGST Act wef 01.02.2019

The Central Goods and Services Tax (Amendment) Act, 2018 received assent of The President of India on August 29, 2018 but some of the provisions are made effective from 01.02.2019 vide vide various notifications. This Article discusses the major changes in GST wef 01.2.2019. I. Concept of Business Vertical deleted – GST allows multiple ...

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GST on Sale of Land & Building

Sale of land and building (except when sold before completion certificate), is neither supply of service, nor supply of goods, as per Schedule III of CGST Act. As per Schedule II of CGST Act 2017, Construction (including additions, alterations, replacements or remodelling of any existing civil structure) of a complex, building, civil stru...

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The Panorama of ITC on Rent-a-cab

Input Tax Credit, a word which has perturbed many professionals and businesses since the inception of GST. New definitions under GST have unsettled the earlier decisions on CENVAT / MODVAT credit provisions and the GST advance rulings have further aggravated such issues. In this article we have made an attempt to cover all aspects related...

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New GST Portal functionality to Compare Liability Declared & ITC Claimed

New Functionality is available on GST Portal where one can Compare the Input Tax Credit taken in GSTR-3B and that available in GSTR-2A. This tool is a great help for making GST Reconciliation for Annual Return or making ITC Reconciliation for Finding out that how much ITC we have claimed in GSTR-3B and how much […]...

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Importance of Soon Approaching Due Date March 31, 2019

As we all know, March 31, 2019 is the last day of the Financial Year 2018-2019 (Assessment Year 2019-2020), however, are we all aware of the importance of the same? In other words, what is the importance of due date March 31, 2019? Present article tries to provide detail answer to the same. Following is […]...

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