FILE ST-3 TO AVOID PENALTY OF RS. 20,000/-

ACES has started accepting Service Tax (ST-3) returns for the period April to June 2012 revising the earlier forms by removing few bugs. The extended time to file now is till 25th Nov for Apr to Jun 12 ST Returns. Returns for July to September 2012 is still undergoing some structural changes. 

Though extended time has been granted, returns are no more half yearly and converted to quarterly period in line with approach to GST. However, is change in period of ST return linear/consistent with current ST Law? I suppose the light shall be glared on existing penal provisions. Section 77 charges penalty on non-filing of returns maximum up to Rs. 20,000/-. In just recent past, this provision was amended from penalty of Rs. 2,000/- to Rs. 20,000/- for a half yearly return and adding fuel to the gravity of penalty, it may be chargeable for a quarterly return now on wards resulting in to person failed to file ST return might be incurring Rs. 80,000/- per year (could be for NIL returns as well. Note :- though there are specific powers to the Superintendent to waive penalty in case of bonafide reasons for non-filing of NIL returns, hardly these provisions are put in practice).

These inconsistency in law can lead to serious financial damage on tax payers and needs close revision by drafting authority.

Download “Tax Accounting Standards” Issued By The CBDT

Pursuant to s. 145 (1) of the Income-tax Act, 1961 which provides that “Profits and gains of business or profession” & “Income from other sources” shall be computed in accordance with Accounting Standards notified by the Central Government, the CBDT had set up a high-powered committee to draft the Accounting Standards. The Committee has prepared the said “Tax Accounting Standards” and invited comments from all professionals by 26.11.2012.

The draft Tax Accounting Standards deal with the following 14 important issues:

1. Disclosure of Accounting Policies
2. Valuation of Inventories
3. Events Occurring After the Previous Year
4. Prior Period Items
5. Construction Contracts
6. Revenue Recognition
7. Accounting for Tangible Fixed Assets
8. The Effects of Changes in Foreign Exchange Rates
9. Government Grants
10. Securities
11. Borrowing Costs
12. Leases
13. Intangible Assets
14. Provisions, Contingent Liabilities and Contingent Assets

 http://www.itatonline.org/info/?dl_id=1059

Whether once AO changes mind after taking approval for special audit u/s 142(2A), it needs to invite fresh objections from assessee if AO wants to propose fresh special audit - YES: Delhi HC

THE issues before the Bench are - Whether when the AO dropped the opinion originally formed for special audit u/s 142(2A) and there is nothing on record to show that there was any fresh development compelling the AO to change his mind and come to the conclusion that ‘certain complexities have been noted in the accounts of the assessee’, proposal approved for special audit is not valid; Whether it is incumbent on the AO to issue another show-cause notice to the

FAQS on Contribution by the Partners in LLP Organization

1.  What are the various forms of contribution or capital by the partners?

Ans: As per Sec 32(1) of the LLP Act,2008, the partners may introduce capital or contribute to the organization in the following manner, or combination thereof ;

• Tangible, moveable property
• Tangible, immovable property
• Intangible property
• Contracts for services performed or to be performed
• Agreement for contributing cash or property
• Monetary contribution
• Promissory Notes

2.  Is the disclosure for the amount and nature of contribution of all partners obligatory to be disclosed in the LLP accounts?

CBEC NOTIFICATION

Central Board of Excise and customs has come up with a few updates in the area of Service Tax and Central Excise. The key news highlights include

1. Service tax: return filing deadline extended
2. Corrigendum to anti-dumping duty notification (steel products from USA etc)
3. Customs: exchange rates notified
4. Customs: changes in tariff values
5. Items meant for Long Range Surface Air Missile programme exempted from customs & excise duties
6. Central excise demands related to fraudulently obtained duty exemption scrips
7. Value of bought out caps – whether includible in assessable value of tubes

Please check out our product details on our website www.udyogsoftware.com . Also the news flash can be accessed by the URL furnished below.


http://www.udyogsoftware.com/documents/10523/61a4035b-3c3f-4b85-ae7c-0565c69e9d04

Whether once AO changes mind after taking approval for special audit u/s 142(2A), it needs to invite fresh objections from assessee if AO wants to propose fresh special audit - YES: Delhi HC

THE issues before the Bench are - Whether when the AO dropped the opinion originally formed for special audit u/s 142(2A) and there is nothing on record to show that there was any fresh development compelling the AO to change his mind and come to the conclusion that ‘certain complexities have been noted in the accounts of the assessee’, proposal approved for special audit is not valid; Whether it is incumbent on the AO to issue another show-cause notice to the assessee u/s 142 (2A), after he changed his mind and proposed special audit and invite the assessee's objections and Whether when as per records, there is no application of mind by the CCIT before granting approval to the proposal for special audit sent by the AO to him, the approval granted by the CCIT for special audit is of no effect and is a nullity. And

Whether when assessee is registered in India for providing ship-broking professional education to Indian students, mere affiliation with its head office in London for purpose of conducting examination makes it an agent of foreign institution - NO: ITAT

THE issues before the Bench are - Whether when the assessee is registered in India for providing ship-broking professional education to Indian students, mere affiliation with its head office in London for the purpose of conducting examination makes it an agent of the foreign institution and Whether when the assessee collects fees for conducting examinations in India, it can be said that the assessee has been running a commercial course for profit. And the verdict goes in favour of the assessee.

Facts of the case

The assessee is registered as a public charitable trust u/s 12AA of the I-T Act. Registration was granted to the assessee

Bank Account Facility for Persons Resident Outside India.

RBI has issued a circular regarding Facilities for Persons Resident outside India. As per this circular a person who resident abroad can avail Bank account facilities to do business, invest and other essential purpose regarding money transfer or utilization etc.

RBI/2012-13/258
A.P. (DIR Series) Circular No.45
October 22, 2012

To,
All Authorised Dealer Category – I Banks
 

Madam / Sir,
 

Facilities for Persons Resident outside India – FIIs
 

Attention of Authorised Dealers Category – I (AD Category – I) banks is invited to the Foreign Exchange Management (Foreign Exchange Derivative Contracts) Regulations, 2000 dated May 3, 2000 [Notification

ST-3 Modified Excel Utility for Service Tax Return Quarter First

Earlier ACES has upload modified version to submit Service Tax Return form ST-3 for the quarter April 2012 to June 2012 in Excel Base. This Excel Based Modified Utility form ST 3 will work offline and not online. It means that the assessee cannot fill the ST-3 form online and upload to ACES website after logging on.  Lastly we aware with extended date to file your Service Tax Return for Quarter April-June vide order No. 3/2012 dated 15.10.12.

 

Offline Excel Base Modified Service Tax Return ST-3 Utility by ACES :

Service Tax
Excel Utilities	Last Updated	XML Schema	Last Updated
Download ST3 Return Excel Utility(For Filing ST-3 returns for the period upto Oct-Mar 2011)	06-04-2012	Download XML Schema for ST3 Return	06-04-2012
Download ST3 Return Excel Utility(For Filing ST-3 returns for the Quarter April-June 2012)	22-10-2012	Download XML Schema for ST3 Return	22-10-2012

PAN Application -Persons authorized to make Credit card / Debit card / Net banking payment

Persons authorized to make Credit card / Debit card / Net banking payment are as below:

Category of Applicant	Payment by Credit Card / Debit Card / Net Banking can be made by / for
Individual	Self, immediate family members (parents, spouse, children)
HUF	Karta of the HUF
Company	Any Director of the Company
Firm / Limited Liability Partnership	Any Partner of the Firm / Limited Liability Partnership
Association of Person(s) / Body of Individuals / Association of Person(s) Trust / Artificial Juridical Person / Local Authority	Authorized Signatory covered under section 140 of Income Tax Act, 1961

  Applicants making credit card / debit card payment will be charged an additional surcharge of Rs. 5.00 by the bank providing payment gateway facility.   

Applicants making payment through Net Banking facility will be charged an additional surcharge of Rs.   4.00 + service tax for payment gateway facility.

Registration with Bureau of Indian Standards mandatory for 15 electronic goods wef March 7, 2013

The Department of Electronics and Information Technology (“DietY”) has made the registration of 15 electronic goods mandatory with the Bureau of Indian Standards (“BIS”) for the relevant Indian Standards (“IS”) prescribed therefor.

For this purpose, the DietY has issued the Electronics and Information Technology Goods (Requirement for Compulsory Registration) Order, 2012 (“the Order”) on September 7, 2012 in exercise of the powers conferred under the Bureau of Indian Standards Act, 1986 (“BIS Act”) and the rules framed there under.

Applicability

The Order shall apply to 15 specified electronic products including inter-alia video games, laptop/notebook/tablet, Plasma/LCD/LED televisions, microwave ovens, printers and scanners, telephone answering machines and set-top boxes.  For complete list of products covered under the Order and the details of the relevant IS for which registration of these products need to be sought from the BIS refer List below.

Intent of the Order

The stated intent behind introduction of the Order is to ensure that the safety standards as specified under the BIS Act and Rules are met with regard to the 15 specified electronic goods covered thereunder.

Effective date

The Order shall come into force after 6 months from the date of its publication in the Official Gazette (ie, September 7, 2012) and shall accordingly be effective from March 7, 2013.

Mandatory self declaration regarding conformity to Indian Standards

Once the Order becomes effective, no person can, by himself or through any person on his behalf, manufacture or store for sale, import, sell or distribute the goods specified under the Order, unless such goods conform to the specified standard and bear a self declaration - “Self Declaration – Conforming to IS (Relevant Indian Standard mentioned in Column 3 of the Schedule)” on such goods after obtaining registration from the BIS.

For instance, laptops manufactured, stored, imported, sold or otherwise intended to be distributed by any person shall need to conform to the Indian Standard IS  13252:2010 and carry the declaration “Self Declaration - Conforming to IS 13252:2010”.

Electronic goods manufactured that are meant for exports not covered

The registration requirements specified under the Order shall not apply in relation to manufacture of goods meant for export purposes.

Ramification of non conformance to IS

Clause 3(2) of the Order states that any sub-standard or defective goods found not conforming to the relevant IS will be required to be deformed beyond use by the manufacturer and disposed off as scrap.

Series approval

The electronic goods of the same family but varying in sizes or rating or construction (called as “series of products”) shall be grouped and may be granted series approval based on testing of the representative models.  This shall obviate the necessity of seeking registration for every single model of a product series.  The decision concerning such series approval shall be taken by DietY or its authorized agency.

Powers of the appropriate authority

The Appropriate Authority or the person authorized by him, in order to secure compliance with the conditions provided in the Order, may require any person engaged in the manufacture, store, sale and distribution of goods to give such information as he deems necessary.

Copy of the order can be viewed here.

List of products mandatorily covered

Sl.No.	Product	Indian Standard Number	Title of Indian Standard
1.	Electronic Games (Video)	IS 616:2010	Audio, Video and Similar Electronic Apparatus - Safety Requirements
2.	Laptop/Notebook/Tablets	IS 13252:2010	Information Technology Equipment - Safety - General Requirements
3.	Plasma /LCD /LED Televisions of screen size 32” & above	IS 616:2010	Audio, Video and Similar Electronic Apparatus - Safety Requirements
4.	Optical Disc Players with built in amplifiers of input power 200W and above	IS 616:2010	Audio, Video and Similar Electronic Apparatus - Safety Requirements
5.	Microwave Ovens	IS 302-2-25:1994	Safety of household and similar electrical appliances: Part 2 Particular requirements: Section 25 Microwave ovens
6.	Visual Display Units , Video Monitors  of screen size 32” & above	IS 13252:2010	Information Technology Equipment - Safety - General Requirements
7.	Printers, Plotters	IS 13252:2003	Information Technology Equipment - Safety - General Requirements
8.	Scanners	IS 13252:2010	Information Technology Equipment - Safety - General Requirements
9.	Wireless Keyboards	IS 13252:2010	Information Technology Equipment - Safety - General Requirements
10.	Telephone Answering Machines	IS 13252:2010	Information Technology Equipment - Safety - General Requirements
11.	Amplifiers with input power 2000W and above	IS 616:2010/	Audio, Video and Similar Electronic Apparatus - Safety Requirements
12.	Electronic Musical  Systems with input power 200W and above	IS 616:2010	Audio, Video and Similar Electronic Apparatus - Safety Requirements
13.	Electronic Clocks with Mains Powers	IS 302-2:26: 1994	Safety of household and similar electrical appliances: Part 2 Particular requirements: Section 26 Clocks
14.	Set Top Box	IS 13252:2010	Audio, Video and Similar Electronic Apparatus - Safety Requirements
15.	Automatic Data Processing Machine	IS 13252:2010	Information Technology Equipment - Safety - General Requirements

HAPPY DUSHERA

Recent SEBI regulations on mutual funds

The Securities and Exchange Board of India (SEBI) has mandated various regulatory changes vide their Circular no. CIR/IMD/DF/21/2012 dated September 13, 2012 and SEBI (Mutual Funds) (Second Amendment) Regulations, 2012. These changes have come into effect from October 1, 2012. We have given an explanation of the changes below. 1. Applicability of NAV (for all schemes other than liquid schemes):

a. For amount less than Rs.2 lacs In respect of valid applications received* up to 3:00 p.m. by the Mutual Fund along with a local cheque or a demand draft payable at par at the place where the application is received, the closing NAV of the day on which application is received shall be applicable.

MOST AWAITED FORM ST-3 RELEASED TODAY

In reference to our earlier Do You Know Series 198, we would further like to intimate most awaited modified version of Form ST-3 for the Quarter April’2012 to June’ 2012 has been released today.

 

Now all the assesses will be able to file their Service Tax return for the quarter April’2012 to June’ 2012, last due date of which is 25^th November, 2012. However, such facility is available in offline mode only i.e. through Excel Utility. Assesses will not be able to fill their ST-3 data online after logging into ACES website.

 

Hope the information will assist you in your Professional endeavors.

Whether before invoking provisions of Sec 179 against Director of a Pvt Company it is necessary for Revenue to establish that tax due cannot be recovered from company - YES: Gujarat HC

THE issues before the Bench are - Whether in order to invoke the provisions of section 179 against a director of a private limited company, the Department must first establish that tax dues from the company cannot be recovered; Whether under section 179 of the Act, the Department could only recover tax due from the director of a private limited company and not interest or penalty and Whether on the facts and in the circumstances of the case, the Department is not justified in seeking recovery of the dues against the petitioner on the ground that there was no gross negligence on part of the petitioner to which non recovery can be attributed. And the verdict goes in favour of the assessee.

Facts of the case

The petitioner was one of the two directors of one Agni Briquette Pvt. Ltd. (herein- after to be referred to as “the said company”). For the AY 1997-1998, the said company filed its return of income declaring nil income. The AO framed

Exemptions u/s. 80C in Asstt. Year 2013-14.

Deduction in respect of Life insurance premia, deferred annuity, contributions to provident fund, subscription to certain equity shares or debentures, etc. (section 80C)

Section 80C, entitles an employee to deductions for the whole of amounts paid or deposited in the current financial year in the following schemes, subject to a limit of Rs. 1,00,000/-:

• Payment of insurance premium to effect or to keep in force an insurance on the life of the individual, the spouse or any child of the individual.
• Any payment made to effect or to keep in force a contract for a deferred annuity, not being an annuity plan as is referred to in item (7) herein below on the life of the individual, the spouse or any child of

PERSONS RESPONSIBLE FOR DEDUCTING TAX AND THEIR DUTIES:

4.1 Section 204 (i) of the Act the "persons responsible for paying" for the purpose of Section 192 means the employer himself or if the employer is a Company, the Company itself including the Principal Officer thereof. Further, as per Section 204(iv), in the case of credit, or as the case may be, if the payment is by or on behalf of Central Government or State Government, the DDO or any other person by whatever name called, responsible for crediting, or as the case may be, paying such sum is the "persons responsible for paying".

4.2 The tax determined as per para 8 should be deducted from the salary u/s 192 of the Act.

4.3. Deduction of Tax at Lower Rate:

Deductions of Medical Treatment etc. u/s. 80DDB for Asstt. Year 2013-14.

Section 80DDB allows a deduction in case of employee, who is resident in India, during the previous year, actually paid any amount for the medical treatment of such disease or ailment as may be specified in the rules HDD (1) (see Annexure) for himself or a dependant. The deduction allowed is equal to the amount actually paid or Rs. 40,000 whichever is less. Further the amount paid should also be reduced by the amount received if any under insurance from an insurerer or reimbursed by an employer. In case of a senior citizen (an individual resident in India who is of the age of sixty years or more at any time during the relevant previous year) the amount of deduction allowed is Rs. 60,000/-.

DDO must ensure that the employee furnishes a certificate in Form 10-I from a neurologist, an oncologist, a urologist, nephrologist, a haematologist, an immunologist or such other specialist, as mentioned in proviso rule 11(2) of the Rules.

For the purpose of this section in the case of an employee "dependant" means individual, the spouse, children, parents, brothers and sisters of the individual or any of them,

ROC NOTIFICATION

The Ministry issued General Circular No.30/2012 dated 28.09.2012, In order to ensure smooth filing and to avoid last minute rush, the due date of filing of e-forms 23AC(Non-XBRL) and 23ACA (Non XBRL) as per new schedule VI is extended in following manner without any additional fee :-

a) Company holding AGM or whose due date for holding AGM is on or before 20.09.2012, the time limit will be 03.11.2012 or due date of filing, which ever is later.

b) Company holding AGM or whose due date for holding AGM is on or after 21.09.2012, the time limit will be 22.11.2012 or due date of filing, which ever is later.

Deductions u/s 16 of the Act from the Income from Salaries

Entertainment Allowance [Section 16(ii)]:

A deduction is also allowed under section 16(ii) in respect of any allowance in the nature of an entertainment allowance specifically granted by an employer to the assessee, who is in receipt of a salary from the Government, a sum equal to one-fifth of his salary(exclusive of any allowance, benefit or other perquisite) or five thousand rupees whichever is less. No deduction on account of entertainment allowance is available to non-government employees.

Tax on Employment [Section 16(iii)]:

The tax on employment (Professional Tax) within the meaning of Article 276(2) of the Constitution of India, leviable by or under any law, shall also be allowed as a deduction in computing the income under the head "Salaries".

It may be clarified that "Standard Deduction" from gross salary income, which was being allowed up to financial year 2004-05 is not allowable from financial year 2005-06 onwards.