Know about “Form ITR-A

 

1. ITR-A is a form provided to furnish a modified return by a successor company to a business reorganization for an assessment year.

2. Where businesses go through a reorganization the successor entity, is required to file modified returns for the period between the date of effectivity of the order and the date of issuance of the final order of the competent authority. Form ITR-A is the prescribed form by the Income Tax Department for filing such a return.

3. When two or more business goes under remodeling, reconstruction, amalgamation, or merger the resulting business or entity is known as the successor entity, and the businesses going under reorganization are known as the predecessor entity.

4. The prescribed form should be furnished within six months from the end of the month in which said order was issued.

5. The ITR-6 (applicable for companies) has been modified to include information contained in FORM ITR-A.

6. In Appendix II, in Form ITR-6- PART A-GEN, entries of the serial number (A19)(a)(i), have been substituted, for every assessment year commencing on April 01, 2022, or any, earlier assessment year.

(Rule 12AD of the Income Tax Rules)

Comparing Indian GST with European VAT

 

It has been more than 5 years since GST has been introduced in India and with the passage of time, the process of GST has stabilized in the country and the government feels proud of the success of GST implementation in the country.  Being tax head of an MNC, I am being exposed to the GST or VAT process of other countries, especially  European countries, and in this article tries to compare the indirect tax process of both countries from my own experience.

GST input credit on Motor vehicles.

ITC is blocked on motor vehicles having seating capacity ≤ 13 persons (including the driver) used for the transportation of persons. Further, ITC is also blocked on certain services relating to motor vehicles namely, insurance, servicing, and repair and maintenance.

What would be the treatment of 𝐭𝐚𝐱𝐞𝐬 𝐩𝐚𝐢𝐝 𝐢𝐧 𝐟𝐨𝐫𝐞𝐢𝐠𝐧 𝐜𝐨𝐮𝐧𝐭𝐫𝐢𝐞𝐬 𝐟𝐨𝐫 𝐰𝐡𝐢𝐜𝐡 𝐜𝐫𝐞𝐝𝐢𝐭 𝐢𝐬 𝐧𝐨𝐭 𝐚𝐯𝐚𝐢𝐥𝐚𝐛𝐥𝐞 𝐢𝐧 𝐈𝐧𝐝𝐢𝐚?

Indian Income Tax Act does not allow refund in such cases but based on various judgments 𝐭𝐡𝐞 𝐩𝐨𝐫𝐭𝐢𝐨𝐧 𝐨𝐟 𝐭𝐚𝐱 𝐟𝐨𝐫 𝐰𝐡𝐢𝐜𝐡 𝐜𝐫𝐞𝐝𝐢𝐭 𝐢𝐬 𝐧𝐨𝐭 𝐚𝐯𝐚𝐢𝐥𝐚𝐛𝐥𝐞 𝐜𝐚𝐧 𝐛𝐞 𝐜𝐥𝐚𝐢𝐦𝐞𝐝 𝐚𝐬 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐝𝐞𝐝𝐮𝐜𝐭𝐢𝐨𝐧. For example, tax paid in say UK is Rs.1000/- whereas credit is only available for Rs.600/-, in this case Rs.400/- can be claimed as business deduction.
Various judgments in support of this view:
𝑉𝑖𝑟𝑚𝑎𝑡𝑖 𝑆𝑜𝑓𝑡𝑤𝑎𝑟𝑒 𝑎𝑛𝑑 𝑇𝑒𝑙𝑒𝑐𝑜𝑚𝑚𝑢𝑛𝑖𝑐𝑎𝑡𝑖𝑜𝑛 𝐿𝑡𝑑. 𝑣𝑠. 𝐷𝐶𝐼𝑇 [𝐼𝑇𝐴 𝑁𝑜.1826/𝐴𝐻𝐷/2019]
𝐵𝑎𝑛𝑘 𝑜𝑓 𝐼𝑛𝑑𝑖𝑎 𝑣𝑠 𝐴𝐶𝐼𝑇 [𝐼𝑇𝐴 𝑁𝑜.869/𝑀𝑢𝑚/2018]
𝑅𝑒𝑙𝑖𝑎𝑛𝑐𝑒 𝐼𝑛𝑓𝑟𝑎𝑠𝑡𝑟𝑢𝑐𝑡𝑢𝑟𝑒 𝐿𝑡𝑑. 𝑣𝑠. 𝐶𝐼𝑇 [𝐼𝑇𝑅 75 𝑜𝑓 1998, 𝐵𝑜𝑚𝑏𝑎𝑦 𝐻𝐶]

Understand foreign tax credit for USA ex-pats.

 

One of the most common problems US ex-pats face is double taxation—paying taxes twice on the same income. Fortunately, the IRS offers multiple tax credits and deductions to help expats avoid this costly burden. One example is the Foreign Tax Credit (Form 1116). Using this credit, many Americans living abroad are able to erase their US tax debt entirely.

Comparison of buy back with dividend

 

Section 94B of the Income-tax Act, 1961 – Unanswered Questions.

Section 94B of the Act was introduced by the Finance Act, 2017 to give effect to 'OECD BEPS Action Plan 4 - Limiting Base Erosion Involving Interest Deductions and Other Financial Payments.

Transfer Pricing Master File Form 3CEAA – Practical considerations

Master File (MF) in Form3CEAA to be e-filed by Indian entities of MNE Group by the due date of filing IT return i.e., 30 November. While Part A of Form has no threshold, Part B to be filed when a) consolidated group revenue >Rs 500 cr & b) aggregate value of international transactions >Rs 50 cr, or aggregate value of IP transactions >Rs 10 cr.

ITC on residential dwelling occupied by the employee is allowed to the employer?

With the withdrawal of the GST exemption on the services by way of renting of residential dwelling for use as a residence when provided to a registered person (RP), an important question that arises is whether the RP is eligible to claim ITC of the GST applicable therein if the residential dwelling is occupied by his employees.

UAE Corporate Tax wef. 01st June 2023

With effective from 01st June 2023, the new corporate tax will apply to businesses across all Emirates, with an exception for the extraction of natural resources, which will remain subject to Emirate level corporate taxation. Foreign entities and individuals will be subject to corporate tax only if they conduct a trade or business in the UAE in an ongoing or regular manner. It is important that businesses evaluate the impact of the introduction of UAE CT early on and proactively plan for a smooth implementation.  Examples:

What is GST Notice.

 Adjudication is adversarial, and Revenue is not willing to backdown from the 'view' canvassed merely because taxpayer has declined to subscribe to it. Revenue will want to exhaust every remedy available in law to 'save the demand'. Justifiably so.

What is Rule 132 of the Income Tax Rules?

 

1. Rule 132 is a beneficial clause allowing assessees to comply with the provision of Section 155 which allows Assessing Officers to re-compute the total income for such previous years in which the assessee would have claimed deduction of surcharge or cess subject to be disallowed u/s 40(a)(ii).

 

CAN TAX AUDIT REPORT BE REVISED?

Section 44AB read with rule 6G prescribes provisions relating to revision of the tax audit report
The Income Tax (Eighth Amendment) Rules, 2021 has inserted sub-rule (3) in rule 6G that provides for reasons to revise tax audit report.

Registration procedure for Casual Taxable persons under GST

According to Section 2(20) of the CGST Act, a Casual taxable person” means a person who occasionally undertakes transactions involving supply of goods or services or both in the course or furtherance of business, whether as principal, agent or in any other capacity, in a State or a Union territory where he has no fixed place of business; This can be easily explained through this following example:- A is participation in a fair/expo in another state. When a taxable person participates in a fair/expo outside the state where his usual place of registration is, then he should register as a casual taxable person in order to undertake the sale and purchase of goods in that other state.

No Interest or Penalty on CVD or SAD Defaults - Customs and GST Implications

 In a major bombshell dropped on the Revenue, the Bombay High Court (‘HC’) in the case of Mahindra and Mahindra Limited v. Union of India, 2022 (10) TMI 2022, held that there is no provision under the Customs Tariff Act, 1975 ('CTA 1975') to levy interest or penalty on Countervailing Duty ('CVD') or Special Additional Duty ('SAD').

Government extends the scope of Customs IGCR Rules

 In our update dated September 12, 2022, we apprised you about the introduction of new Customs (Import of Goods at Concessional Rate of Duty or for Specified End Use) Rules, 2022 [‘IGCRS Rules’]

 

Reiteration on FEMA Regulations.- Capital Account Transactions

 

As you would be aware that Foreign Exchange Transactions in India, are governed by Foreign Exchange Management Act, 1999 (FEMA, 1999) and Rules & Regulations, Notifications, Circulars and Directions (FEMA Regulations) issued thereunder by Reserve Bank of India in consultation with Government of India.

CBDT notifies rules providing manner for filing application for re-computation of income for disallowing claim for cess deduction

 This Tax Alert summarizes a recent Notification No. 111/2022 dated 28 September 2022 issued by the Central Board of Direct Taxes (CBDT) prescribing rule and forms for taxpayers to make voluntary application with the tax authority for re-computation of total income to avoid deeming penal consequences for under-reported income on account of disallowance, on retrospective basis, of surcharge or cess as business deduction which was claimed and allowed in the past.

Outbound/export freight is liable to GST from 1st October

 This is to apprise you about the withdrawal of following two exemptions* from October 1, 2022:

 

-               Services by way of transportation of goods by a vessel from customs station of clearance in India to a place outside India

CBIC notifies effective date for amendments in CGST Act and modifies CGST Rules

 This Tax Alert summarizes recent Notifications issued by Central Board of Indirect Taxes and Customs (CBIC).

Vide Finance Act, 2022, Government had proposed various amendments in the Central Goods and Services Tax Act, 2017 (CGST Act). The following amendments have been now made effective from 1 October 2022: