SUMMARY OF NOTIFICATIONS ISSUED ON 09-10-2019

1.        Due dates:

FORM	Period	Due Date	Reference, if any
GSTR-3B	OCT 2019-Mar 2020	20th       of      succeeding month	44/2019-CT
GSTR-1 (Quarterly)	Next 2 quarters (OCT 19- MAR 20)	Last day of succeeding month of that quarter	45/2019-CT
GSTR-1 (Monthly)	OCT 2019-Mar 2020	11th day of succeeding month	46/2019-CT

2.        Annual Return for taxpayers having aggregate turnover up to Rs. 2 crore:

Filing of annual returns is optional for the registered persons having aggregate turnover up to Rs. 2 crore.

Very Important: Be noted that the return for these taxpayers is not scrapped. It is clearly mentioned in the notification that the return shall be deemed to be furnished if not furnished before the due date. So be ready ………………

Reference: Notification No. 47/2019-CT

3.        Registered person who has applied for cancellation shall not issue any tax invoice and not charge any tax on supplies made by him during the period of suspension of his registration. By any chance, if registration is not cancelled and the suspension is revoked, the taxpayer needs to issue revised invoice for all the invoices raise in the suspension period and declare the same in next return.

4.        Claiming of credit not available in GSTR-2A should not be more than 20% of eligible credit available in GSTR-2A. Time period to test the same is not clearly mentioned, but we believe it should be done on yearly parameters.

For example: Total eligible credit in GSTR-2A is Rs.5,00,000.

Then, scope of credit that can be claimed which are not available in GSTR-2A is Rs.1,00,000 (5,00,000*20%) subject to other conditions.

Another Example: Total Credit in GSTR-2A is Rs.5,00,000 out of which Rs.1,00,000 is ineligible.

Then, scope of credit that can be claimed which are not available in GSTR-2A is Rs.80,000 (4,00,000*20%) subject to other conditions.

5.        FORM GSTR-3B is now a return and luckily/unluckily this will have retrospective effect. (Gujarat High Court judgement in the case of AAP & Co. has lost it’s relevance in respect to the above subject.)

6.        Only The Central Government shall disburse the amount of refund based on consolidated payment advice for grant of provisional refunds.

7.        Missed TRAN-1 due to technical difficulties or fortunate enough to be in Council’s recommendation for such extension?? No worries. Please file it before 31^st December 2019. And due to that TRAN-1, missed TRAN-2?? No worries. Please file it before 31^st January 2020.

8.        A lifeline will be given before issuance of SCN under 73(1)/74(1) in the form of DRC-01A basically intimating the person of tax and applicable interest ascertained by the proper officer with proper grounds. If the person desires to file any submission against the proposed liability or intimate about partial payment of such ascertained value may do the same by filing PART-B of DRC-01A.

Reference (3-9): Notification No. 49/2019-CT

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Taxability of supplies made by Clubs to its members

3-Judge Bench of the Supreme Court has held that no sales tax or service tax is leviable  with respect to supplies made by incorporated clubs to its members.   

Taxation Laws (Amendment) Ordinance, 2019clarified by Circular No. 29 of 2019

The Taxation Laws (Amendment) Ordinance, 2019 (“the Ordinance”), promulgated by the President on 20.09.2019, had interalia introduced a new provision, viz., section 115BAA in the Income Tax Act, 1961 (“the Act”) providing for a lower rate of tax at 22% (plus applicable surcharge and cess) for domestic companies, subject to fulfilment of certain conditions. Simultaneously, section 115JB relating to payment of Minimum Alternate Tax (‘MAT’) on book profit was also amended to provide that companies opting for preferential rate of tax under section 115BAA of the Act will be exempt from MAT on book profit under the former section.   

Analysis of Section 115BAA

In Circular No. 29 dated 02.10.2019, the CBDT has expressed the view that the tax credit of MAT paid by a domestic company exercising option under the newly inserted Section 115BAA of the Act shall not be available on the ground that the charging provisions of Section 115JB are itself not applicable to such a company. CA S. Venkatraman has examined the correctness of this view in the light of several judgements of the Supreme Court and opined that the stand of the CBDT is not correct and requires reconsideration

Imp Judgements

Directorate of Elementary Education vs. Pramod Kumar Sahoo (Supreme Court)

A concession given by Counsel, if it is a concession in law and contrary to the statutory rules, is not binding on the litigant for the reason that there cannot be any estoppel against law (see also Himalayan Cooperative Group Housing Society Vs. Balwan Singh (2015) 7 SCC 373 Bharat Heavy Electricals Ltd vs. Mahendra Prasad Jakhmola & V. Ramesh vs. ACIT (Madras High Court)

The concession given by the learned State Counsel before the Tribunal was a concession in law and contrary to the statutory rules. Such concession is not binding on the State for the reason that there cannot be any estoppel against law. The rules provide for a specific Grade of Pay, therefore, the concession given by the learned State Counsel before the Tribunal is not binding on the appellant

SC rules application for refund of self-assessed duty without appeal is not maintainable

This Tax Alert summarizes a recent ruling of the Supreme Court (SC)^[1]. The issue before the court was that in absence of any challenge to the order of assessment under Customs and Central Excise, whether refund application against the assessed duty can be entertained.

Tax return and audit reports filing due date for tax year 2018-19 applicable to taxpayers liable for audit is extended to 31 October 2019

As per the Indian tax laws (ITL) ^[1], in case of taxpayers ^[2] being:

(a) company or
(b) other taxpayers whose accounts are required to be audited under the ITL or any other law for the time being in force or
(c) working partner of a firm whose accounts are required to be audited under the ITL or any other law for the time being in force,

the due date for submission of their tax returns for tax year 2018-19 is 30 September 2019. Further, if a taxpayer  furnishes tax return after the due date, but before 31 December of the following tax year, the taxpayer is liable for payment of late fee^[3] of INR 5,000. On further delay, the fee increases to INR 10,000.

The Central Board of Direct Taxes (CBDT) ^[4]  vide order dated 27 September 2019^[5] (Order) has extended the due date for filing tax return and various reports of audit in relation to tax year 2018-19 for aforesaid category of taxpayers who are liable to file their tax returns by 30 September 2019 to 31 October 2019. The extension is granted primarily due to difficulties being faced by taxpayers in furnishing the tax returns for various reasons including availability of limited time with tax professionals for completion of audits, floods in certain parts of the country, etc.

Further, since the time prescribed under the ITL for furnishing tax return itself is extended, fee for late filling of tax return may also not be leviable for the tax returns filed up to 31 October 2019.

While due date for filing tax return is extended, no relief is granted by the CBDT for the levy of interest for filing of tax return beyond 30 September 2019. As a consequence, if the taxpayer files his tax return on or after 1 October 2019 but before 31 October 2019 i.e., within the extended due date, he will be liable to pay an interest @ 1% for one month on the balance amount of tax payable. However, no interest will be leviable if no tax is payable by the taxpayer on account of pre-paid taxes or otherwise.

IS E Assessment is a Game Changes?

A. Introduction:

Through Finance Act, 2018, Central Government has intended to introduce new scheme of scrutiny assessment under the Income Tax Act, 1961 for improving effectiveness of tax administration. It has thus brought three new sections to the Income Tax Act viz. 143(3A) to prescribe new procedure by the Central Government, 143(3B) to enable Central Government to notify applications of provisions of the Income Tax Act with such modification, adaptions or exceptions as may be specified and 143(3C) to provide for laying every notification issued u/s 143(3A) or 143(3B) before each House of Parliament.  

Interest earned on unutillised funds kept in FDRs due to delay in completion of project held as capital receipt

Where assessee-company, incorporated for development and operation of multipurpose port terminal, raised certain share capital in form of foreign inward remittance, in view of fact that said project got delayed due to various reasons beyond assessee's control and, thus, assessee had to keep unutilised funds in banks in form of FDRs, interest income earned on said deposits being in nature of capital receipt, was not liable to tax

[2019] 109 taxmann.com 105 (Mumbai - Trib.)/[2019] 71 ITR(T) 390 (Mumbai - Trib.)

The Companies (Amendment) Act, 2019: key takeaways

The Companies (Amendment) Bill received the President’s assent on 31 July 2019 and was published in the official gazette on the same date as the Companies (Amendment) Act, 2019 (Amendment Act).  The Amendment Act further amends the Companies Act, 2013 (Act). Majority of the provisions of the Amendment Act are deemed to have come into effect on 2 November 2018.  The remaining provisions, barring the amendment relating to corporate social responsibility, were made effective from 15 August 2019.

The key takeaways of the Amendment Act are: 

·         Dematerialized securities

·         Penalty for certain offences

·         Enhanced penalty for repeated defaults

·         Corporate social responsibility (CSR)

·         Commencement of business

·         Registration of charges

·         Beneficial ownership

·         Power of central government and National Company Law Tribunal (NCLT) in case of oppression and mismanagement 

The Amendment Act seeks to strengthen the existing governance norms and compliance management in the corporate sector by making a provision for imposition of enhanced penalties in case of repeated defaults. The central government now has a greater say in cases of oppression and mismanagement, and the individuals responsible for the same can now be directly held accountable. 

The Amendment Act has made it mandatory for all companies (required under the Act) to set aside monetary contributions for corporate social responsibility, even if such contribution is not earmarked for a specific purpose. 

HC rules provision prescribing due date to claim transitional credit under GST is not mandatory

This Tax Alert summarizes a recent ruling  ^[1] of Gujarat High Court (HC). The issues in the Writ Petition was to allow filing of declaration for transitional credit beyond the due date and whether rule 117 of Central Goods and Services Tax Rules, 2017 providing the due date to claim transitional credit is procedural in nature, and thus merely directory and not a mandatory provision.

PUBLIC CONSULTATION ON ELECTRONIC INVOICE STANDARDS TO BE USED UNDER GST SYSTEM

1.    Background

The GST Council has decided to introduce electronic-invoice (hereinafter called as e-invoice) on voluntary basis from January 2020. The new system will lead to one-time reporting on B2B invoice data in the form it is generated to reduce reporting in multiple formats (one for GSTR-1 and the other for e-way bill) and to generate Sales and Purchase Registers (ANX-1 and ANX-2) and from this data to keep the Return (RET-1 etc.) ready for filing. The other aim is to make reporting of invoices as an integral part of the business process to eliminate the process of compilation of invoices at the end of the month. Lastly, it will lead to substantial reduction in input credit verification issues as same data will get reported to tax department as well as to the buyer in his inward supply (purchase) register on receipt of info thru GST System – as buyer can reconcile with his Purchase Order and accept/reject well in time.

CBIC issues further clarifications on Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019

This Tax Alert summarizes a recent circular ^[1] issued by Central Board of Indirect Taxes and Customs (CBIC) on Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019.

Apart from reiterating the importance and benefits, the circular clarifies on few more issues arising out of the provisions of the scheme. Circular also provides instructions to the officers to make the scheme a success and ensure its smooth implementation.

The key clarifications are as follows:

•  If a person has been issued a show cause notice (SCN) for erroneous refund, they will still be eligible to file declaration for other disputed cases under the scheme.

•  The dispute relating to only penalty or late fee pending before appellate forum shall also be eligible under the scheme.

•  Ineligibility under the scheme for finally heard matters in appeal shall not apply in cases where the hearings are rescheduled after the final hearing due to new bench, change in officer or any other reason.

•  Cases where proceedings before the Settlement Commission are abated, shall be covered under the scheme, provided the eligibility is otherwise established. Further, any pending appeals, reference or writ petition filed against or any arrears emerging out of the orders of the Commission are also eligible under the scheme.

Clarification issued by the government on eligibility of cases of penalty/ late fee pending before the appellate authority is likely to benefit the taxpayers, considering the quantum of such litigation.

More such clarification may be expected from the CBIC basis practical and technical difficulties faced by the taxpayers in the process of filing the declarations.
 

Imp Case laws

All India Federation of Tax Practitioners (AIFTP) vs. UOI (Bombay High Court)

The work of important Tribunal like Income Tax Appellate Tribunal (ITAT) should not be allowed to suffer on account of shortage of administrative staff. There is no lethargy on the part of the Dept in filing up said posts. The Dept is expected to follow up the proposals to fill up the posts of Assistant Registrars in such quota as well as for issuing promotions for the posts of Deputy Registrars so that all these pots to the extent possible can be filled up at the earliest

The petitioner’s grievance that the work of important Tribunal like Income Tax Appellate Tribunal should not be allowed to suffer on account of shortage of administrative staff is perfectly legitimate, however, we do not find any lethargy on the part of the Department in not filing up said posts. Under these circumstances, we would expect the Department to follow up the proposals to fill up the posts of Assistant Registrars in such quota as well as for issuing promotions for the posts of Deputy Registrars so that all these pots to the extent possible can be filled up at the earliest

CBDT forms dedicated cell for start-ups to redress tax grievances

This Flash News explains a recent Order dated 30 August 2019 issued by the Central Board of Direct Taxes (CBDT) for setting-up of a dedicated cell for start-ups (“Start-up Cell”) to redress the grievances and address the various issues under Indian Tax Laws (ITL), including angel tax. The CBDT Order is issued in light of the announcement made by the Finance Minister in Budget Speech as also at the press meeting held on 23 August 2019.

The Start-up Cell comprises of the officials from different hierarchy at CBDT and can be contacted over telephone number (011-23095479/23093070 (F)) and email id (startupcell.cbdt@gov.in).

The CBDT Order is issued to implement the announcement made by the Finance Minister in Budget Speech on 5 July 2019 as also at the press meeting held on 23 August 2019 and is the latest in a series of proactive steps undertaken by CBDT to provide impetus to Start-up industry and clarify the ambiguities under the ITL.

Tax Due Date- September 2019

S. No	Due Date	Related to	Compliance to be made
1	11.09.2019	GST	Filing of GSTR-1 for August 2019.
2	20.09.2019	GST	- Payment & filing of GST return for the Month of August 2019- Form GSTR 3B
3	07.09.2019	TDS/TCS (Income Tax)	· Deposit TDS for payments of Salary, Interest, Commission or Brokerage, Rent, Professional fee, payment to Contractors, etc. during the month of August 2019. · Deposit TDS from Salaries deducted during the month of August 2019 • Deposit TCS for collections made under section 206C including sale of scrap during the month of August 2019, if any • Deliver a copy of Form 15G/15H, if any to CCIT or CIT for declarations received in the month of August 2019, if any
4	30.09.2019	Income tax	Filing of income  tax return for the Corporate assesses (or) Non Corporate assesses (Whose books of accounts are required to be audited U/s 44AB of IT act 1964 (or) working partner (of a firm whose books of accounts required to be audit ( in case of Assesses not having international or specified domestic transaction). (All Sasken Trusts Return have to be filed.)
5	15.09.2019	Income Tax	Payment of Advance tax for the Corporate and Non Corporate assesses –Amount not less than 45% of advance tax respectively.

CBDT further clarifies reporting requirement for foreign directorship and foreign assets for filing income tax return for tax year 2018-19

CBDT further clarifies reporting requirement for foreign directorship and foreign assets for filing income tax return for tax year 2018-19

This Tax Alert summarizes recent clarifications issued by the Central Board of Direct Taxes^[1]  (CBDT), vide Circular No. 21/2019 dated 27 August 2019 (Second Circular), in relation to compliance of reporting requirements in the income tax return forms (ITR forms) for tax year 2018-19.

The ITR forms applicable for tax year 2018-19 were notified in April 2019^[2] and they introduced substantive additional disclosures. In relation to additional reporting requirements, various queries were raised by stakeholders to the CBDT^[3] , seeking clarification on the manner and scope of reporting requirements. These included reporting in relation to details of directorship in a foreign company, equity shares listed outside India etc., which were clarified by the CBDT, in the form of frequently asked questions (FAQs), vide Circular No. 18/2019 dated 8 August 2019 (First Circular) ^[4].

Now, the CBDT, vide the Second Circular, has further clarified that individual taxpayers, being non-resident, are not required to provide details of directorship in a foreign company which does not have any income received or accruing or arising in India. Furthermore, details of foreign assets are required to be reported by resident taxpayers only if such foreign assets are held during the tax year in India, as also in the accounting period as per the foreign tax jurisdiction, as defined in the instructions to the ITR Forms.

Shareholder liable to capital gains tax on receipt of partnership interest against shares on conversion of a company into an LLP under the LLP Act

Shareholder liable to capital gains tax on receipt of partnership interest against shares on conversion of a company into an LLP under the LLP Act

This Tax Alert summarizes a recent ruling  of the Authority for Advance Rulings, New Delhi (AAR), dated 23 August 2019, in the case of Domino Printing Science Plc. (Taxpayer). The AAR, in this case, held that conversion of a company into a limited liability partnership (LLP) in accordance with the provisions of The Limited Liability Partnership Act, 2008 (LLP Act) results in transfer of shares by the shareholders of the converting company. The AAR further held that the value of interest in the LLP is to be considered as the “full value of consideration” received on the transfer of shares for the purpose of computation of capital gains under the Indian Tax Laws (ITL).

GST on Realty Sector

AS all  are well aware, the GST law, insofar as it concerns the Realty Sector, has been virtually re-written with effect from 1-4-2019 and that, the levy of GST at the lower rates without the benefit of ITC is compulsory for projects which commence on or after 1-4-2019 and that, in respect of 'ongoing projects', the Developer has the option to continue with the old scheme wherein, ITC is allowed. Hence, the new scheme would, by and large, boil down to the interpretation of the definitions of an 'ongoing project' and 'a project which commences on or after 1-4-2019'.  

Finance Minister Honourable Smt. Nirmala Sitaraman Address to Media and Press Release On 23rd August 2019

q The whole presentation was structured in 32 slides with 6 compartments of Specific areas of concern for economic slowdown.

q Global GDP is at 3.2% and likely to be revised downwards, being global demand is very weak.

q Advanced economies also facing slow down largely due to trade war between US and China and China continuously devaluing its currency.

q India bubble positioned very high in terms of Growth rate, probably the highest in world.

TDS ON PAYMENT EXCEEDING 50 LAKHS

 new section 194M is proposed to be inserted in the Income Tax Act by the Budget 2019 that provides levy of TDS @ 5% on the sum or aggregate of sums, paid or credited in a year on account of contractual work or professional fees by an Individual or Hindu undivided family, not required to deduct tax at source under sec 194C and 194J of the Act if such sum or aggregate of such sums exceed Rs 50 lacs in a year. However, in order to reduce the compliance burden, it is proposed that such individuals or HUFs shall be able to deposit the tax deducted using their Permanent Account Number (PAN) and shall not be required to obtain Tax Deduction Account Number (TAN). So, no need to file regular TDS return in such cases.   

TURNING 8 TODAY

Eight years ago, on the same day i.e 11^th August 2011, I decided to share tax knowledge by way of blogging and TAXBYMANISH came into existence   That time I never presumed that this will be a life changing game for me.  With TAXBYMANISH I able to connect tax professionals across the world. Lets have a look into the following blog statistics which shows the success of blog.

Ø  Number of post                              6768

Ø  Total number of hits                      27.81 Lakhs

The above milestone  has been made possible because of your love and support only.  Thanks for all your support and  happy reading.

https://taxbymanish.blogspot.com/

Govt releases FAQs on NMC Bill 2019

THE Parliament has passed the National Medical Commission Bill 2019. The Govt has today released a detailed FAQs on this Bill and detailed the impact of various clauses. Some of them are as follows:   

FAO urges balancing more food production with sustainable agriculture

THE Food and Agricultural Organization today stated that the Green Revolution that transformed agricultural production in the Asia-Pacific region is alive and well but must retool to embrace climate-sensitive innovations and technologies to sustainably meet the increasingly complex demands of a nutrient-deficient world. Such observations were made at a function organized to commemorate 30 years of development achievement of the M.S. Swaminathan Research Foundation under the outstanding leadership of its mentor and visionary, Mr M.S. Swaminathan, a trail-blazing scientist who spent decades applying scientific research to tackle hunger, malnutrition and poverty.  

GST Update

GST Council Recommendations

•                    Recommendation of 36th GST Council Meeting

•                    Reduction in the GST rate on supply of goods and services :

•                    The GST rate on all electric vehicles be reduced from 12% to 5%.

•                    The GST rate on charger or charging stations for Electric vehicles be reduced from 18% to 5%.

Treatment of Write Back Amount in GST Era

Background: 

The taxpayers may have long outstanding the creditors whose dues are not paid. The non-payment of dues may be on account of many business decisions.

As per prudent accounting policies, the long outstanding dues are reviewed periodically and written back (credited to profit & loss account) in the books of accounts.

Does the Transactional Profit Split Method Apply to Centralized Business Models?

1. Purpose of the blog

The purpose of this blog is to address whether the transactional profit split method (TPSM) applies to centralized business models operated by multinational enterprises (MNEs). The assessment will be made in light of the post BEPS transfer pricing guidance, that is, the 2017 OECD Transfer Pricing Guidelines (TPG) and the revised guidance on the TPSM (revised PSM report). Kindly note that the blog will not discuss the impact of the international corporate tax debate triggered by digitalization.

Value Of Uncertified Foreign Bank Records Under DTAA For Prosecution Under The (Indian) Income Tax Act And Black Money (Undisclosed Foreign Income And Assets) And Imposition Of Tax Act

The intention of the legislature is pretty clear from recent development in the field of law dealing with white-collar crimes. The legislature focuses on setting out legal provisions which will help the government in curbing out the issue of Black Money. One of the major developments in this aspect is the enactment of Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015. This Act was enacted specifically to deal with the problem of Undisclosed Foreign Assets held outside India by Indian residents. The Income Tax Act, 1961 makes it mandatory for an ordinary resident to declare all of his/her foreign assets and income. When a person being a resident does not disclose a foreign asset, such person is considered to be evading tax and can be penalized under The (Indian) Income Tax Act,1961 and other relevant legislation dealing with the offences pertaining to evasion of tax.

GST on Employee Recoveries

In GST law, there are few activities which would be treated as supply liable for GST even in the absence of consideration. These activities are listed in Schedule I to CGST Act 2017 with few entries finding place in Schedule II as well. One such activity listed in Schedule I is supply of goods or services between employee and employer when such supply is made in course or furtherance of business. There would be various payment transactions between employee and employer having impact in GST law. In this article, we have analysed few types of payments having GST impact.

Tax due Date - August 2019

11.08.2019	GST	Filing of GSTR – 1 for the month of July 2019
20.08.2019	GST	- Payment & filing of GST return for the Month of July 2019- Form GSTR 3B
07.08.2019	TDS/TCS (Income Tax)	· Deposit TDS for payments of Salary, Interest, Commission or Brokerage, Rent, Professional fee, payment to Contractors, etc. during the month of July 2019. · Deposit TDS from Salaries deducted during the month of July 2019 • Deposit TCS for collections made under section 206C including sale of scrap during the month of July 2019, if any • Deliver a copy of Form 15G/15H, if any to CCIT or CIT for declarations received in the month of July 2019, if any