Some of the Recent Important Judgements of the Supreme Court Pertaining to PMLA

 The Supreme Court of India has issued several key judgments in recent years concerning the Prevention of Money Laundering Act (PMLA). These rulings provide important clarifications on various aspects of money laundering, procedural safeguards, and the scope of the law. Below are some of the landmark judgments:

Partition of a Hindu Undivided Family (HUF):

1. Legal Framework: Section 171 of the Income Tax Act, 1961, governs the partition of a Hindu Undivided Family (HUF). This section provides the legal basis for dividing the assets and liabilities of the HUF among its members.

How GST Affects Transfer Pricing

When India introduced the Goods and Services Tax (GST), it created a big change in the way companies handle their taxes. Earlier, businesses just focused on following income tax rules for setting prices between related companies. Now, they have to balance both income tax and GST rules, which makes things a bit tricky, especially for big international companies. This article explains why GST and transfer pricing matter and what companies do to follow the rules.

Fetching of document from Tax Service Platform available with Depository by listed companies for giving tax claim relief to Foreign Portfolio Investor

 Please find below communication for your information and necessary action:

1. Pursuant to the amendments made in the Income Tax Act by the Finance Acts, 2020, 2021 and 2023, dividend and interest paid by companies are taxable in the hands of shareholders and bond holders. Companies are required to deduct tax at source (TDS) at the rates applicable to each category of the shareholder. Certain categories of domestic Investors are exempted while for other categories like Foreign Portfolio Investor (FPls), tax has to be deducted at 20% (plus surcharge and cess) or at a beneficial tax rate applicable under Double Taxation Avoidance Agreement (DTAA).

Taxation of Deferred Compensation – A Continuing Conundrum

In the world of mergers and acquisitions (M&A), determining the value of a transaction can be complex, especially when involving deferred compensation. This article delves into the taxation challenges surrounding such compensations, highlighting judicial interpretations and the ongoing uncertainties faced by both buyers and sellers.

GSTN issues advisory on hard-locking of auto-populated values in Form GSTR-3B

 This Tax Alert summarizes the recent advisory issued by Goods and Services Tax Network (GSTN) on hard-locking of auto populated values in GSTR-3B.

The highlights of the advisory are:

• GSTN has improved the GST return filing process by providing a pre-filled GSTR-3B form with auto-populated tax liability from GSTR-1/ 1A/ invoice furnishing facility (IFF) and input tax credit (ITC) from GSTR-2B, along with a detailed pdf report.
• Taxpayers can now amend incorrect outward supplies in GSTR-1/ IFF through GSTR-1A before filing GSTR-3B and manage inward supplies for accurate ITC claims using the Invoice Management System (IMS).
• Starting tentatively from January 2025, the GST Portal will restrict changes in auto-populated tax liability in pre-filled GSTR-3B to improve accuracy. Necessary changes should be made through GSTR-1A.
• However, locking of auto-populated ITC in GSTR-3B will be implemented after IMS rollout, with a separate advisory to be issued post addressing IMS-related issues.

CBIC issues clarifications pertaining to amnesty scheme under GST

 This Tax Alert summarizes recent Circular issued by Central Board of Indirect Taxes and Customs (CBIC) clarifying various issues relating to the provisions of waiver of interest and penalty (amnesty scheme) under Section 128A of the Central Goods and Services Tax Act, 2017 (CGST Act).

The key clarifications are:

Demystifying Transfer Pricing of Intangibles: Challenges and Solutions

Introduction Transfer pricing involving intangibles is one of the most complex areas in international taxation. Multinational enterprises (MNEs) heavily depend on intellectual property (IP) and other intangible assets such as patents, brands, and technological know-how, which are difficult to value due to their non-physical nature. Ensuring proper transfer pricing of intangibles is critical for compliance and to avoid disputes with tax authorities.

EPFO circular on utilization of reserves and surplus by private Provident Fund Trusts of exempted establishments

The Employees Provident Fund Organisation (EPFO) has issued a circular dated 7 October 2024 (No. E.III/10(122)/ 2024/Circular/Exemption/5435) regarding the manner of utilization of Reserves and Surplus by private Provident Fund Trusts of exempted establishments, for distribution of interest among members.

This circular is issued by the EPFO Head Office after observing instances of exempted establishments seeking permission to utilize Reserves and Surplus lying in the Provident Fund Trusts by crediting interest to existing beneficiaries at a much higher rate (as compared to the EPFO notified interest rate) during / just prior to surrender of exemption and transition to the EPFO. As per the circular, the EPFO has given a thoughtful consideration to the issue and its legal ramifications and has the set out the following principles:

Notifications pursuant to 54th GST Council Meeting

 This is to update you on the notifications issued by the Ministry of Finance, which seeks to give effect to certain recommendations/ amendments proposed in the 54^th GST Council meeting.

Impact of 2022 SC judgement of New Noble Education Society:

A. What is charitable purpose?

1. As per 2(15) of the Income Tax Act, the term “charitable purpose” includes relief of the poor, education, medical relief, and any other object of general public utility.
2. However, after the 2008 amendment to the Income Tax Act, an additional condition was introduced. If any entity involved in activities related to “general public utility” engages in commercial activities for profit, it cannot be treated as a charitable institution.

Analysis of decision of the Delhi HC in the case of Tiger Global

Analysis of decision by the Delhi High Court in Tiger Global International III Holdings v. AAR, which reinforces the legal status of Tax Residency Certificates (TRCs) issued by Mauritius under the Double Taxation Avoidance Agreement (DTAA) between India and Mauritius. Key points include:

SC upholds validity of almost 90,000 reassessment notices issued during COVID-19 times and grants big relief to tax department

 This Tax Alert summarizes a significant decision of 3 Judge Bench of Supreme Court^[1] (SC) addressing the interplay between the Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance, 2020 (TOLA), which extended certain time limits under Income Tax Law^[2] (ITL), and the provisions of ITL as amended vide Finance Act (FA) 2021 dealing with reassessment of past years.

SC holds ITC should be eligible on goods and services used for construction of building, if qualifies as a ’plant’

 This Tax Alert summarizes a recent ruling of the Supreme Court (SC)¹ on the eligibility of input tax credit pertaining to goods and services used in construction.  The Court has held that the functionality test would need to be applied to determine whether the construction is of a “plant or machinery” to determine credit eligibility.

 

Government notifies effective date for amendments made in GST law vide Finance (No.2) Act 2024

 This Tax Alert summarizes recent Notification^[1] issued by Central Board of Indirect Taxes and Customs (CBIC) notifying effective date for the amendments made in Central Goods and Services Tax Act, 2017 (CGST Act) and allied laws vide Finance (No.2) Act, 2024.

TDS Changes from 1st October, 2024

The TDS rate for payments under sections *194DA, 194H, 194-IB, and 194M* is reduced from 5% to 2%.
*Section 194DA* - Payment in respect of life insurance policy is reduced from 5% to 2%.

India Tax Due Tax - October 2024.

S. No	Due Date	Related to	Compliance to be made
1	11.10.2024	GST	Filing of GSTR 1 for the month of September 2024
2	20.10.2024	GST	-Payment of GST for the month of September, 2024 -Filing of GSTR 3B for the month of September, 2024
3	07.10.2024	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 September 2024. · Deposit TDS from Salaries deducted during the month of September 2024 • Deposit TCS for collections made under section 206C including sale of scrap during the month of September 2024, if any • Deliver a copy of Form 15G/15H, if any to CCIT or CIT for declarations received in the month of September 2024, if any
4	31.10.2024	TDS Return	·       Filing of 2nd Quarter (1st July to 31st September) TDS return.
5	15.10.2024	TCS Return	·       Filing of 2nd Quarter (1st July to 31st September) TCS return.
6	31.10.2024	Tax Audit	Filing of Audit Reports 3CA, 3CD, 3CEB for the financial year 2023-24
7	31.10.2024	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 & SSTPL must be filed  )

                                                                                    

GSTN to not retain return data for view of taxpayers beyond 7 years

 This is to apprise you of a recent advisory issued by GSTIN on 24 September 2024 regarding archival of GST returns data on GST portal. In this regard, below key points are worth noting:

HC quashes Notification 56/2023 extending time limit to pass order under GST

 This Tax Alert summarizes a recent ruling of the Gauhati High Court (HC) ^[1] on the validity of notifications extending the time limit to pass order under section 73(10) of Central Goods and Services Tax Act, 2017 (CGST Act).

The key observations of the HC are:  

Taxation of Transfer Fees in Co-operative Housing Societies: An Examination of the Principle of Mutuality

 1. Understanding Co-operative Housing Societies

A co-operative housing society (hereinafter referred to as ‘Society’) includes all types of societies, whether residential, commercial, or industrial. These societies are formed to collectively manage the affairs of a community, typically focusing on maintaining common amenities, property management, and ensuring shared responsibilities among members.