"03 May 2020" Archive

Refund in case of Inverted Tax Structure under GST

Section 54 (1) of CGST Act 2017 provides that Any person claiming refund of any tax and interest, if any, paid on such tax or any other amount paid by him, may make an application before the expiry of two years from the relevant date in such form and manner as may be prescribed....

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ITC Reversal Due To Non-Payment Within 180 Days

Second & third proviso to Section 16(2), of the Central Goods & Services Tax (CGST) Act, 2017 provides for reversal and reavailment of ITC on account of non-payment. Same is reproduced below for ready reference: Second Proviso to Section 16(2) :- “Provided further that where a recipient fails to pay to the supplier of goods [&he...

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Refund of Input / Input Services – Export without payment of GST

1. GST refund process for exports of Goods and /or services without payment of Tax involves a different document. The option to export goods without payment of tax can either be used under the cover of a Letter of Undertaking (LUT) or a Bond. In such case, any ITC accumulated on inputs/input services unutilised will […]...

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ITC on Canteen Service- Food for thought

It is very common that many factories and offices provide canteen facilities to their employees. Such facility may be provided as a matter of compulsion or as per the terms of employment or otherwise. The canteen facility may be provided to employees at free of cost or concessional rate or on chargeable basis. The GST […]...

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Extension in GST returns: A Hoax

To provide relief to businesses wriggling with the economic impact due to Covid-19, the central government has provided the extension in GST return filing. To give effect to the same, the central government has issued certain notifications. However, from the perusal of the same, it appears that the government intends to provide relief onl...

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Job Work under GST – A Detailed Analysis – Part 1

Section 143 lays down the procedure for sending the inputs and capital goods to a job worker. As per the said provision, a registered person (‘Principal’) may send inputs or capital goods to a job worker without payment of tax subject to condition that such inputs or capital goods would be brought back within prescribed time period....

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Form GST PMT 09 to Transfer GST in Electronic Cash ledger

File FORM GST PMT 09, to shift/transfer money available in Electronic Cash ledger, between various major and minor heads of GST Taxpayers deposit money using challan and the paid amount gets credited in the particular head in the Electronic Cash ledger and the same can be utilized in settling liabilities of that head only. In […]...

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Effect of moratorium on ongoing tax proceedings against Corporate Debtors

The Insolvency and Bankruptcy Code, 2016 (IBC) streamlines the process minimizing losses and promoting efficient allocation of resources to deal with sick companies. The article provides an analysis of the effect of moratorium on ongoing tax proceedings against the Corporate Debtors (CD). Tax collection in India, be it income tax, excise ...

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Some GST Aspects & Transactions Explained with Q&A- Part IV

The applicant is engaged in IT training programmes to Government aided Secondary and Higher Secondary Schools across the State of Delhi to implement the training projects for Government-aided Schools.  Whether the applicant is liable to pay GST?...

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Anomaly in provisions for taxing dividend income, as per Finance Act, 2020

While drastically changing the erstwhile provisions regarding taxability of Dividend Income, there remains an anomaly in relation to cascading effect scenario. The same is dealt hereunder: In the erstwhile provisions, to avoid cascading effect (i.e. multi-level taxation of same dividend income), the tax rate u/s 115O was calculated on the...

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Income Tax Audit – Recent Changes & Key Areas

Income Tax Audit Focusing on Recent Changes and Key Areas with Practical Examples This Article explains the Provisions of Income Tax Audit governed by Section 44AB of Income Tax Act, 1961 including the recent amendments in Budget 2020. Income Tax Audit Meaning: Tax Audit is an audit which is made compulsory by Income Tax Act, […]...

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Coercive measures cannot be taken against taxpayer in case he challenges Black Money Act

Anila Rasiklal Mehta Vs Union of India (Bombay High Court)

Since assessee had not disclosed any black money or asset in the income tax proceedings going against him rather he had denied the same, therefore, while respondents may proceed pursuant to the impugned notices dated December 20, 2017 to assessee under Section 10(1) of the Black Money Act calling upon them to produce the details sought fo...

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Lower or nil rate tax deduction certificate- Duty of deductor

Actions to be taken by the deductor on receipt of the certificate: Please validate the PAN of the deductee submitting the certificate. The Certificate should be valid for the PAN, Section and Rate which has been mentioned in the statement filed. Check that the certificate is valid for the relevant Financial Year....

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Income Tax on Gifts: Exemptions and computation

Receiving Gift indeed brings a cheerful smile on the face of the receiver, but if receiver gets to know that he has to pay tax thereon, the smiling face may turn sad. Although Gift Tax Act has been abolished, however there are certain provisions in the Income Tax Act, which make the gift taxable in […]...

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File TDS return on time to avoid Penalty / Late Payment Fees

As we all are aware that the due date of TDS return filing is coming closer for 4th Quarter i.e. 31st May, 2020 for FY 2019-20. Hence this article is kind of reminder for all taxpayers to be compliant towards filing of return within due date to avoid unnecessary interest and late fees. Today I […]...

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How to prevent Income Tax Raids, Searches & Seizures

What leads to income tax raids, searches and seizures? The main reasons are non-compliance with summons under Section 131(1) of the Income Tax Act, 1961, (hereinafter referred to as the Act) or a notice under Section 142(1) of the Act (described in Chapter VII, infra), likely non-compliance with such summons or notice, or the possession ...

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Features of Budget 2020 applicable for individual assessees

Finance Bill 2020 has proposed significant amendments in direct tax provisions. I would like to highlight the changes which are applicable for Individual assessees. Read on. ♣ Dividend Distribution Tax Abolishment: Upto financial year 2019-2020, domestic company was required to pay dividend distribution tax u/s 115-O at the rate of 15%...

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Private Placement (Section 42) Under Companies Act, 2013

Private placement as defined under Explanation II to sub-section (1) of section 42 of the Companies Act 2013, means any offer of securities or invitation to subscribe securities to a select group of persons by a company other than by way of public offer through issue of a private placement offer letter and which satisfies […]...

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Passing of Resolution by Circulation under Companies Act, 2013

Section 175 of the Companies Act, 2013 (the Act) read with Rule 5 of Companies (Meeting of the Board and its Powers) Rules, 2016 and Standard 6 of Secretarial Standards-1 issued by the Institute of Company Secretaries of India allows the Company to pass a resolution by circulation without convening a Board meeting or a […]...

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Section 8 companies under companies act 2013

A company registered under companies act 2013 or previous applicable act and has in objects to, – Sports Promote commerce, art, science, education, research, social welfare, religion, charity, protection of environment or any such other object; And intends to apply its profits, if any, or other income in promoting its objective, int...

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Compliance Manual for F.Y. 2020-21 (A.Y. 2021-22)

This compliance book aims at helping and providing practical solutions and day to day compliance requirements to professionals, entrepreneurs and all small to large businesses as it has summarized provisions, charts and important notes with tables which can be easily understood. Compliance Hand Book contains the following- Income Tax- Inc...

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Clarification regarding Movement of Persons and Vehicles in Orange Zones, during Two Weeks Lockdown with effect from May 4, 2020

After a comprehensive review of the Lockdown measures to contain the COVID-19 situation in the country, Union Ministry of Home Affairs (MHA), issued an Order yesterday, to further extend the Lockdown for a further period of two weeks w.e.f. May 4, 2020....

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New guidelines for hearing of cases by CAT in Green, Orange & Red Zones

The functioning of the Principal Bench of the Central Administrative Tribunal and its other Benches across the Country was suspended in view of the lockdown announced by the Ministry of Home Affairs, Government of India vide Orders dt: 24.03.2020 and the subsequent order of extension dt: 14.04.2020 till 03.05.2020....

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Analysing Cash Flow Statement in Depth

With passage of time for many of us Cash Flows Statement has become just a component of Financial Statements that need to be prepared or verified. However in the recent times, with advent of COVID-19 pandemic around the globe Cash Flows Statement along with other components of financial statement is becoming extremely important for prospe...

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Digital Accounting, Faceless Assessment & March 2020 GST Return

Digital Accounting COVED-19 gives us a lesson to work from anywhere and not necessarily from fixed office place. Rendering accounting service from anywhere needs transformation of physical accounting system to digital accounting system. It is advantageous to business owners in many ways viz. business owners get accounting information read...

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No Section 68 addition of partners capital contribution in Firm if source of capital proved

Kesharwani Sheetalaya Sahsaon Allahabad Vs CIT (Allahabad High Court)

Addition under section 68 for not proving the source of income of partners who have made the deposit with the firm in their capital account could not be made as partners had shown the agricultural income in their personal returns of the past years which had been accepted by the department as such and the partners were all identifiable and...

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No addition for investment in hundis which were made out from business receipts

Bhandari Hospital and Research Centre (ITAT Indore)

When it was presumed that investment in hundi was bogus in such a situation there was no money available for the investment made by the assessee as such amount surrendered was not available, therefore, this proved that donation was made out of business receipts, which was an allowable expenditure....

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SC on Sufficiency of Notice Sent under Certificate of Posting

Mohd. Asif Naseer Vs West Watch Company (Supreme Court)

Mohd. Asif Naseer Vs West Watch Company (Supreme Court) It may be so that mere receipt of notice having been sent under certificate of posting, in itself, may not be sufficient proof of service, but if the same is coupled with other facts and circumstances which go to show that the party had notice, the […]...

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Tax on Sale of Property cannot be levied from GPA Holder

Sama Om Reddy Vs ITO (ITAT Hyderabad)

Sama Om Reddy Vs ITO (ITAT Hyderabad) Ld.Counsel for the assessee had reiterated the submissions made by the assessee before the AO and has submitted that by virtue of the Agreement of Sale cum GPA and handing over of the possession, the assessee had transferred the property in favour of the Vendee/GPA-holder, Shri A.Manikyam. It [&hellip...

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Delhi HC grants relief to Indiabulls Housing Finance on NCD dues

Indiabulls Housing Finance Ltd. Vs SEBI (Delhi High Court)

It has become impossible for the petitioner to effect recoveries of debts, owed to it by various institutions, which, in the submission of Mr. Nayar, aggregate to over Rs. 3 crores. In view thereof, the submission of Mr. Nayar is that, as the lockdown has been presently extended till 3rd May, 2020, this matter may be re-notified thereaft...

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Detention of goods with vehicle despite no discrepancy in documents & good

Sanjaybhai Laxmanbhai Gogara Vs State of Gujarat (Gujarat High Court)

 It was submitted that in the absence of any discrepancy in the documents and the goods, it is not permissible for the respondents to confiscate either the vehicle or the goods....

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Covid 19- HC stays Bank account attachment subject to Rs. 5 Lakh setting apart for Taxes

Niyasha Barman Vs ITO (Calcutta High Court)

Niyasha Barman Vs ITO (Calcutta High Court) There subsists an order dated March 20, 2020 passed by the Hon’ble Supreme Court directing the revenue authorities not to initiate any recovery proceedings during the subsistence of the COVID-19 pandemic. In my view, interest of justice would be subserved by directing the banks of the petition...

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Locked Economy Now on Ventilator

This piece of economic analysis is being written on 2nd May, 2020 when the lockdown has been further extended upto 17th May, 2020, locking  majority of the population of India. The streets are empty, trains and flights are not running, schools, offices and factories are shut. India  is trying to fight a global pandemic, which […]...

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AO cannot reject Section 14A disallowance made by assessee without recording his satisfaction

ACIT Vs Indiabulls Real Estate Ltd. (ITAT Delhi)

AO cannot reject suo-moto disallowance made by assessee under Section 14A of the Income Tax Act, 1961 without recording his satisfaction as required under Section 14A(2) of the Income Tax Act, 1961....

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Documenting Your Relationship- A Must in Business

Recently a non-regular client approached me after almost 1.5 years for seeking legal opinion on the almost broke relations with another partner in his partnership business and the reason to approach me is due to the fact that the relations was not in any possibility of gaining any good momentum for further business and it […]...

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Funding Raising By Company

A company is a huge organization and multiple functions take place on daily basis. There is a cycle where company receives and pay the amount for receiving and selling the services or their respective product. But there are times, when a company requires funds whose reason may vary from decision to take their production level […]...

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Section 80IC deduction allowed for service charges based on direct nexus between service rendered & product

Xalted Information Systems Pvt. Ltd. Vs ITO (ITAT Banglore)

The issue under consideration is that whether deduction u/s 80-IC will be allowed against service charges since services rendered were part of business and also involved manufacturing activity?...

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‘No-Adjournment days’ in Courts will Result in Economy Growth

It is very well known to Global stage that India is a Democratic Country and is being run in a very democratic manner which is a positive side to hear but at the same time it is also very much well known at Global stage that Indian Courts taken years for a case and such […]...

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Best way to avoid Small Business Litigation

What is Litigation? Litigation means “a dispute between two parties”. The disputes are generally in two categories; Criminal and Civil. In this brief article, I am referring to “Civil Disputes” arises because of transactions between the parties, commercial or non-commercial. The litigation comes when the parties are not able to ...

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Grow Business = Choose Arbitration for Dispute Resolution

Today the current scenario in India in regard to Business and Market, there is one answer with all the Business Houses and in one word “that the market is bad, very bad” and the reasons for the same is being shifted to Government of India and its policies and newly sated laws. There is no […]...

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Know how to see Your Court Cases filed in District and Session Courts?

Other Site Link The Indian Courts have been using online methods to ensure more transparency and at same time the Litigant to know and get update of their matters as and when they want in independently manner as there are cases where the Litigant are not able to get their cases update regularly and hence […]...

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It is risk-free to do business as Sole Proprietorship & Traditional Partnership?

A Big ‘NO’ Businesses in India can be done by various different methods. There is no doubt that due to increase innovation and technology, the world market has become closer and closer and in fact, it hardly takes time to close the deal across the Globe due to technology and innovation. In today’s competitive business [&hell...

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Does Standard Documents Templates make doing Business easy?

Doing Business in today’s ever-changing scenario compels the business entities to ensure they are well within the coverage of being able to beat their competitors and if not then they fade from the market very soon. For e.g., Shopping Malls have been duly replaced by online shopping and in fact Refund policy offered by online […]...

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Tax on Income of Liaison offices carrying business of preparatory or auxiliary character

Union of India & Anr. Vs U.A.E. Exchange Centre (Supreme Court)

Since the activities carried on by the liaison office of the non-resident in India was to only carry on such activity of a 'preparatory or auxiliary' character, therefore, the same was not a PE in terms of Article 5 of the DTAA and the deeming provisions in Sections 5 and 9 of the 1961 Act could have no bearing....

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SEBI Notification on capital & debt market services wef May 04, 2020

Circular No. SEBI/HO/MIRSD/RTAMB/CIR/P/2020/77 (03/05/2020)

The Ministry of Home Affairs vide Order No.40-3/2020-DM-I(A)dated May 01,2020 has  issued revised guidelines on the measures to be taken for containment of COVID-19 in the country and directed that these measures will continue to remain in force for two weeks with effect from May 04, 2020. Accordingly,in terms of clause 10 of the said...

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Assessment by GST Officer: Keep an eye over the Taxpayer

As we all know that, Goods and Service Tax (GST) is the consumption based tax and self-assessment based system i.e. the GST law empowers taxpayers to self-assessed the CGST, SGST and IGST liability and pay the same to the government exchequer. In other words, it could be said that a trust has been placed, by […]...

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