ST Application - Required Documents

Documents required to be submitted along with the ST-1 Application for the purpose of registration

Trade Notice No. 15/ST/2009, dated 22-9-2009

 

1. Attention is invited to the documents required to be submitted alongwith the ST-1 application for the purpose  of registration of service tax assessees. The following documents will be accepted for the proof of address and for establishing identity constitution of company.

2. The following documents are required to be submitted in case of Single/Centralised Registration:

a.             Copy of PAN card of the assessee,

b.            Residential addresses of proprietor/partners,

c.             Memorandum of Association/Partnership deed,

d.            Power of Attorney in respect of the Authorised Signatory, his name & Address details.

e.      Proof of address of the premises for which single/centralised registration is being taken (Col 6 of ST-1). A copy of telephone bill, electricity bill, rent agreement in the name of the proprietor/ partnership firm (in case of proprietary/partnership concern) or document issued by any of the Central/State Government Department e.g. Income Tax / Sales tax / Registrar of Companies etc.

3. Further documents for Centralised Registration:

i) A duly notarised affidavit of the Company Secretary/MD/CEO or Partner or Proprietor, certifying that the assessee is keeping Centralised accounting or Centralised billing at the premises mentioned in column 6 of ST-1 under sub rule (2) and (3A) of rule of the Service tax Rules, 1994 (i.e for premises where centralised  registration is being sought.) and that the addresses of the premises are as per the list provided,

ii) Where the number of branches is less than 10 in number per application/ amendment, the assessee may submit an affidavit, as mentioned in 3(i) above certifying that the list of addresses mentioned in Column 5 of the ST-1 are correct or provide proof of address as per 2(e) above.

4. Further, there is no need to submit all the above documents for addition/deletion of any service/branch - if already submitted to the Department earlier.  However, in case of addition of new premises, the same maybe mentioned in affidavit as mentioned in 3(ii) above.

5. The authorised signatory of the applicant should ensure that all the columns in the ST-1, including the declaration, are duly completed. The entries should be correctly and legibly filled in order to avoid delay in issuance of the registration.  Only legible copies of the documents be submitted to the department.

 

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CA. V.M.V.SUBBA RAO
Chartered Accountant
Door No.24-2-1885,
I Floor, Flat No.5,
Siddivinayaka Residency, I Cross,
Central Avenue, MSR Nagar,
Magunta Layout,
Nellore-524 003
Andhra Pradesh
India
Mobile:+91 - 0 9390221100
           +91 - 0 9440278412
e-Mail: vmvsr@rediffmail.com
           vmvsr@yahoo.co.uk

Alert on Gift-in-kind- wef 01/10/09

Wednesday, September 30, 2009
	Ministry of Finance
	GIFTS OF PROPERTY (GIFTS-IN-KIND) AVOVE VALUE OF RS.50,000 BECOME TAXABLE FROM 1ST OCTOBER 2009
	16:14 IST
	The Income Tax Act 1961 (the Act) has been amended with effect from 1st October 2009 to provide that any gift-in-kind, being an immovable property or any other property, the value of which exceeds Rs.50,000 (rupees fifty thousand), will become taxable in the hands of the donee, being an individual or a Hindu Undivided Family (HUF), as income from other sources under clause (vii) of sub-section 2 of section 56 of the Act. Therefore, any such person who receives a gift of any such property on or after 1st October 2009 must pay the income tax due on the value of the gift and disclose the taxable value of such property in the return of income for assessment year 2010-11 and subsequent years. The following types of gifts will, however, not be subject to tax, i.e. gifts (a) from a person who is a relative; (b) on the occasion of marriage of the individual; (c) under a will or by way of inheritance; (d) in contemplation of death of the donor; (e) from any local authority as defined in the Explanation to section 10(20) of the Act; (f) from any fund or trust established under section 10(23C) of the Act; (g) from any trust or institution registered under section 12AA of the Act. Relative is defined in the Act as (i) spouse; (ii) brother or sister; (iii) brother or sister of the spouse; (iv) brother or sister of either of the parents; (v) any lineal ascendant or descendant; (vi) spouse of any of the relative at clauses (ii) to (v); of the individual. Gifts received from these relatives will not be subject to tax. Earlier cash gifts exceeding Rs.25,000 were subject to tax with effect from 1st April 2004. Later the Act was amended with effect from 1st April 2006 to tax all cash gifts having aggregate value exceeding Rs.50,000. Cash gifts also enjoy exemptions as is available for gifts-in-kind. ***********BSC/BY/GN-337/09

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CA. V.M.V.SUBBA RAO
Chartered Accountant
Door No.24-2-1885,
I Floor, Flat No.5,
Siddivinayaka Residency, I Cross,
Central Avenue, MSR Nagar,
Magunta Layout,
Nellore-524 003
Andhra Pradesh
India
Mobile:+91 - 0 9390221100
           +91 - 0 9440278412
e-Mail: vmvsr@rediffmail.com
           vmvsr@yahoo.co.uk

List of Nominations received for ICAI Elections

29th September, 2009 Nominations received till the last date and time i.e. 24th September, 2009 (6.00 P.M.) Details of region-wise persons whose nominations have been received, within the appointed time and date i.e. 6:00 p.m. on 24th September, 2009 at the designated location, for contesting the Elections to the Twenty First Council and Twentieth Regional Councils scheduled to be held in December, 2009.   I. TWENTY FIRST COUNCIL   CONSTITUENCY NO. I - WESTERN INDIA REGIONAL CONSTITUENCY Name Membership No. Place CA. Adukia Rajkumar Satyanarayan 34769 Mumbai CA. Agarwal Brijmohan 33254 Mumbai CA. Arun Anandagiri 116887 Pune CA. Bansal Krishan Lal 49311 Pune CA. Bheda Atul Chunilal 38108 Mumbai CA. Buch Durgesh Vamanray 37899 Ahmedabad CA. Chhajed Prafulla Premsukh 47690 Mumbai CA. Deshpande Chintamani Vasudeo 43299 Pune CA. Doshi Bhavana Gautam (Ms.) 30144 Mumbai CA. Ghia Tarun Jamnadas 35489 Mumbai CA. Gokhale Jayant Purushottam 33767 Mumbai CA. Jain Pankaj Inderchand 48850 Mumbai CA. Jaju Shrikant Lalchand 43916 Nashik CA. Jambusaria Nihar Niranjan 35520 Mumbai CA. Madkholkar Mahesh Keshav 45305 Thane CA. Maheshwari Sanjeev Krishnagopal 38755 Mumbai CA. Rathi Bal Kishan 84361 Surat CA. Sarda Mahesh Pansukhlal 15145 Rajkot CA. Shah Dhinal Ashvinbhai 45341 Ahmedabad CA. Shah Dilipkumar Vadilal 34294 Ahmedabad CA. Shah Hardik Pravinkumar 109920 Surat CA. Shah Jaydeep Narendra 41002 Nagpur CA. Shah Raju Chandrakant 39024 Ahmedabad CA. Thakkar Ashokkumar Rameshchandra 48169 Vadodara CA. Vikamsey Nilesh Shivji 37665 Mumbai CA. Zaware Shiwaji Bhikaji 14528 Pune   CONSTITUENCY NO. II - SOUTHERN INDIA REGIONAL CONSTITUENCY   Name Membership No. Place CA. Ambika S. (Ms.) 209661 Hyderabad CA. Balasubramaniam G. 21390 Chennai CA. Daga Shanti Lal 11617 Hyderabad CA. Devaraja Reddy M. 26202 Hyderabad CA. James V.C. 22565 Ernakulam (Kochi) CA. Madhava Murthy K.S. 29946 Bangalore CA. Madhubala Nahar (Ms.) 26355 Chennai CA. Madhukar Narayan Hiregange 27409 Bangalore CA. Murali V. 25952 Chennai CA. Raghu K. 200145 Bangalore CA. Raghunathan S. 19485 Chennai CA. Rajendra Kumar P. 204314 Chennai CA. Ramaswamy G. 23076 Coimbatore CA. Santhana Krishnan S. 19071 Chennai CA. Suneel Kumar Appaji 205394 Hyderabad CA. Venkateswarlu J. 22481 Hyderabad   CONSTITUENCY NO.III - EASTERN INDIA REGIONAL CONSTITUENCY   Name Membership No. Place CA. Agrawal Subodh Kumar 54670 Kolkata CA. Bandyopadhyay Abhijit 54785 Kolkata CA. Chunder Suvendu 56093 Kolkata CA. Dokania Gopal Prasad 50764 Kolkata CA. Guha Sumantra 55753 Kolkata CA. Haldar Nirupam 3755 Kolkata CA. Jain Vikash 56982 Kolkata CA. Khandelwal Kashi Prasad 50244 Kolkata CA. Mitra Debashis 53649 Guwahati CA. Shah Mahesh 50908 Kolkata   CONSTITUENCY NO. IV - CENTRAL INDIA REGIONAL CONSTITUENCY   Name Membership No. Place CA. Agrawal Dhruva Kumar 87665 Noida CA. Bhansali Sudhir 73267 Jaipur CA. Fadnis Manoj 72707 Indore CA. Garg Vijay Kumar 76387 Jaipur CA. Goyal Anuj 75710 Ghaziabad CA. Gupta Akshay Kumar 70744 Kanpur CA. Gupta Kamal Raj 70176 Kanpur CA. Gupta Satish Kumar 72990 Jaipur CA. Holani Ravindra 73288 Gwalior CA. Kapoor Raj 76113 Lucknow CA. Lohani Ashutosh 77600 Lucknow CA. Raniwala Ravindra 73191 Jaipur CA. Satish Kumar 75486 Patna CA. Sharma Prakash 72332 Jaipur CA. Sharma Vikas 77469 Kanpur CA. Vashisht Amresh Kumar 72739 Meerut CA. Vijaywargiya Ashok 70862 Gwalior   CONSTITUENCY NO. V - NORTHERN INDIA REGIONAL CONSTITUENCY   Name Membership No. Place CA. Agarwal Sanjay Kumar 85252 New Delhi CA. Agarwal Sudhir Kumar 88583 Delhi CA. Chandak Kanhaiya Lal 9683 Delhi CA. Chopra Amarjit 16984 New Delhi CA. Garg Baldev 92225 Chandigarh CA. Gaur Ravindra Kumar 72146 Delhi CA. Gupta Bhagwan Das 86260 Delhi CA. Gupta Naveen N.D. 93777 New Delhi CA. Gupta Rekha Kumari (Ms.) 76971 Delhi CA. Gupta Vijay Kumar 86481 Faridabad CA. Jain Vinod 81263 New Delhi CA. Kaushal Kishore 90075 Gurgaon CA. Munjal Naresh Kumar 82147 New Delhi CA. Nanda Charanjot Singh 89658 New Delhi CA. Tyagee Pankaj 502257 New Delhi CA. Verma Ashok Kumar 82084 Frankfurt am Main (Germany)   II. TWENTIETH REGIONAL COUNCILS   Name Membership No. Place CA. Advani Raj Niranjan 39953 Thane CA. Agarwal Subhash Hariprasad 36130 Mumbai CA. Agarwal Vishnu Kumar 114630 Mumbai CA. Apte Dilip Moreshwar 34624 Pune CA. Bhandari Anil Satyanarayan 104644 Mumbai CA. Brahme Sanjiv Gangadhar 31719 Dombivali CA. Chhaira Jay Ajit 103559 Surat CA. Dhamankar Pramod Dattatray 34892 Vasai CA. Dodhia Vandana Vershibhai (Ms.) 104000 Mumbai CA. Gandhi Dinesh Balkrishna 44008 Pune CA. Hegde Nandkishore Chidamber 40197 Mumbai CA. Jain Ashok Chand 43442 Mumbai CA. Jain Sandeep Kailashchand 110713 Mumbai CA. Jaju Shrikant Lalchand 43916 Nashik CA. Joshi Makarand Madhusudhan 47196 Nagpur CA. Joshi Shriniwas Yeshwant 32523 Mumbai CA. Kabra Durgesh Kumar 44075 Mumbai CA. Kala Jayesh Umedmal 101686 Mumbai CA. Kedia Subhash Kumar 52579 Mumbai CA. Khandelwal Dhiraj Kumar 105591 Mumbai CA. Kinare Mangesh Pandurang 45481 Mumbai CA. Lalan Sanjeev Dungarshi 45329 Mumbai CA. Limaye Milind Yashwant 105366 Pune CA. Majithia Neel Pankaj 122626 Mumbai CA. Mantry Kailash Shankarlal 36665 Mira Road CA. Mehta Mahendra 42990 Mumbai CA. Mishra Narottam Lal 44896 Mumbai CA. Modi Mitishkumar Sanmukhlal 45765 Surat CA. Pagariya Ashokkumar Nensukh 34311 Pune CA. Paliwal Dayaram 109393 Bhayandar CA. Pamnani Chandrakant Harnamdas 39906 Ahmedabad CA. Patel Amrish Jashvantlal 32908 Ahmedabad CA. Patel Bhailalbhai Kanjibhai 32199 Ahmedabad CA. Pathak Nitin Maheshkumar 37802 Ahmedabad CA. Patodia Sunil Kumar 45489 Mumbai CA. Pawar Chandrakant Vasant 107703 Nashik CA. Ramesha Shetty 204538 Mumbai CA. Raval Parag Rajnikant 44902 Ahmedabad CA. Shah Julfesh Madhusudan 101558 Nagpur CA. Shah Rajesh Navnitlal 44892 Vadodara CA. Shah Shardul Dilip 113860 Mumbai CA. Shah Shruti Jayesh (Ms.) 101499 Mumbai CA. Sharma Radhey Shyam 49286 Mumbai CA. Sharma Umesh Ramnarayan 104605 Aurangabad CA. Shenoy Anand Pundalik 40777 Mumbai CA. Upasani Charuhas Dwarkanath 42761 Pune CA. Vaidya Kashyap Krishnaprasad 32032 Mumbai CA. Verlekar Gautam 113029 Margao Goa CA. Vyas Yamal Ashwinkumar 35033 Ahmedabad   SOUTHERN INDIA REGIONAL COUNCIL   Name Membership No. Place CA. Alagappan V. 200546 Tiruchirapalli CA. Amrit Kumar K. 200605 Hyderabad CA. Aruloli P.R. 200468 Chennai CA. Babu Abraham 26973 Kochi CA. Chakra Pani B 23598 Hyderabad CA. Gopal Krishna Raju 205929 Chennai CA. Gopalakrishnan T.R. 207024 Chennai CA. Jose V X 203068 Kochi CA. Mohamed Shafi M.A. 13199 Chennai CA. Murali S. 215636 Coimbatore CA. Muralidharan K.P. 27923 Chennai CA. Nagaraja Gupta P.V. 25258 Bangalore CA. Naresh Chandra Gelli V. 201754 Hyderabad CA. Pankaj Kumar Trivedi 28392 Hyderabad CA. Phalguna Kumar E. 20278 Tirupati CA. Prasanna Kumar D. 23999 Visakhapatnam CA, Rajgopal A. 205296 Bangalore CA. Rajarajeswaran P.V. 25264 Madurai CA. Ramamoorthy V. 18928 Chennai CA. Ranjit Karthikeyan M R 201680 Thiruvananthapuram CA. Satyanarayana GVV 24021 Vijayawada CA. Shanmukha Sundaram K. 26847 Coimbatore CA. Shenbagamoorthy C. 23719 Sivakasi CA. Sivakumar R. 23801 Chennai CA. Srinivas C.S. 205804 Bangalore CA. Sumermal D. Ostawal 24449 Hubli CA. Sunil Kumar Jain P. 23348 Chennai CA. Suresh Kumar N. 213640 Kollam CA. Suresh P.R. 27488 Bangalore CA. Tara Chand Mehta 24918 Bangalore CA. Thomachen T.A. 26256 Thrissur CA. Tony M P 205217 Thrissur CA. Umamaheswara Rao O.K. 210744 Chennai CA. Venkatesu Reddy T. 206975 Tirupati CA. Viswanath K. 22812 Bangalore   EASTERN INDIA REGIONAL COUNCIL   Name Membership No. Place CA. Agarwal Ranjeet Kumar 59869 Kolkata CA. Bhattacharyya Krishanu 59934 Uttarpara CA. Bhattacharyya Prasun Kumar 53002 Kolkata CA. Chatterjee Anindra Nath 55985 Kolkata CA. Das Samar Kumar 51011 Kolkata CA. Ghosh Chandan 56438 Kolkata CA. Goyal Sushil Kumar 57534 Kolkata CA. Jain Sonu (Ms.) 60015 Kolkata CA. Jhunjhunwala Rajesh Kumar 55762 Cuttack CA. Khator Rishi 56529 Kolkata CA. Kothari Raj Kumar 55208 Kolkata CA. Mehrotra Namrata (Ms.) 58130 Kolkata CA. Rungta Pramod Dayal 56069 Kolkata CA. Sahoo Sunil Kumar 56068 Bhubaneswar CA. Saraf Subhash Chandra 52244 Kolkata   CENTRAL INDIA REGIONAL COUNCIL   Name Membership No. Place CA. Agarwal Dinesh Chandra 71263 Udaipur CA. Agarwal Nitish 400088 Abu Road CA. Agrawal Brij Mohan 87414 Noida CA. Agrawal Laxmi Narayan 78427 Durg CA. Agrawal Manu 72814 Kanpur CA. Gaddhyan Vinod Kumar 70457 Ranchi CA. Garg Umesh Kumar 73517 Agra CA. Ghiya Sanjay Kumar 72467 Jaipur CA. Golechha Ankush Prakashchandra 111980 Raipur CA. Goyal Vijay Prakash 70893 Jodhpur CA. Gupta Manish 92257 Noida CA. Jain Pradeep Kumar 404107 Jaipur CA. Kanungo Pawan Kumar 74315 Jaipur CA. Khandelwal Ajay Kumar 76901 Bhopal CA. Khanna Vivek 75240 Kanpur CA. Kushwah Mukesh Singh 96656 Ghaziabad CA. Lodha Rakesh Kumar 76255 Udaipur CA. Mahato Nawal Kishore 405832 Jamshedpur CA. Maheshwari Om Prakash 73201 Jodhpur CA. Mishra Ajai Kumar 77060 Varanasi CA. Mittal Vinay 78907 Ghaziabad CA. Parashar Pawan 73384 Jaipur CA. Pradhan Anubhav 113980 Ujjain CA. Rameshwar Prasad Vijay 72635 Jaipur CA. Sethiya Indra Mal 36271 Jaipur CA. Sharda Natwar Kumar 76070 Jaipur CA. Shrivastava Nishant 406540 Noida CA. Shukla Dinesh Chandra 72308 Kanpur CA. Singh Kamendra Kumar 52939 Patna CA. Soni Kemisha (Ms.) 78005 Indore CA. Srivastava Rajesh Kumar 74797 Lucknow CA. Vyas Nitin 79819 Jaipur   NORTHERN INDIA REGIONAL COUNCIL   Name Membership No. Place CA. Agrawal Deen Dayal 48545 New Delhi CA. Agrawal Durga Das 85575 Delhi CA. Agrawal Rajesh Kumar 89057 New Delhi CA. Agrawal Sanjay Kumar 506604 New Delhi CA. Agrawal Sunil Kumar 93851 Delhi CA. Anil Kumar 91593 Bahadurgarh CA. Ashvani Kumar 511712 Delhi CA. Bansal Puneet Kumar 506598 Delhi CA. Bansal Radhey Shyam 91903 Delhi CA. Chawla Raj Kumar 90460 Samalkha CA. Choudhary Mahak Singh 505312 New Delhi CA. Chugh Hans Raj 88646 New Delhi CA. Garg Vishal 501557 Ludhiana CA. Goel Rajiv 97431 Delhi CA. Goyal Rajan 95327 Barnala CA. Gupta Atul Kumar 97009 Delhi CA. Gupta Rekha Kumari (Ms.) 76971 Delhi CA. Gupta Suresh Kumar 83371 New Delhi CA. Jain Gaurav 506695 Delhi CA. Jain Neeraj 99581 Delhi CA. Kedia Gopal Kumar 54629 New Delhi CA. Khetrapal Rashmi (Ms.) 97683 Gurgaon CA. Khurana Gaurav Singh 510707 Delhi CA. Maheshwari Pramod Kumar 85362 New Delhi CA. Mittal Mohan Lal 85705 New Delhi CA. Narang Rajinder 91043 Fatehabad CA. Seth Raman Kumar 87572 Chandigarh CA. Sharma Rajesh 98258 Delhi CA. Varshney Rakesh 96012 Delhi   It may be noted that the said details only indicate the receipt of nominations in time and one has to wait for the list of Valid Nominations to be issued on 9th October, 2009 for the purpose of ascertaining eligibility to contest. In other words, persons whose names will be included in the list of Valid Nominations to be issued on 9th October, 2009, as per election schedule, shall alone be eligible to contest the said elections. T. KARTHIKEYAN RETURNING OFFICER | Ashwin Nagar | FCA and SAP-FICO\SEM-BCS | Success is not permanent and failure is not final Ph: India: +91-98330-15352  US: +1-323-325-4111 --- बुध, 30/9/09 को, RAJESH DUDHARA & CO. <sachnam@dataone.in> ने लिखा: द्वारा: RAJESH DUDHARA & CO. <sachnam@dataone.in> विषय: 5.6 [SPAM detected Spam-Test: True ; 5.8 / 3.0] A very matured way of venting out..... To: ggthaker56@yahoo.co.in, ashwin.nagar@gmail.com, gshank67@hotmail.com, roopalcs_2001@rediffmail.com, gandhijignesh@hotmail.com, srdto1012@yahoo.co.in, sjshahca@yahoo.com, STSME@REDIFFMAIL.COM, marzunjokhi@hotmail.com, parag@gkcco.com, rajendrakumar@welcaststeels.com, rajesh_1917@yahoo.co.in दिनांक: बुधवार, 30 सितंबर, 2009, 11:44 AM "We didn't bowl well. I tried whatever we had, but the captain can't really go and bowl. At the end of the day, the bowlers have to go and bowl," said the Indian skipper. "Frankly speaking, I thought I was short of three bowlers. I didn't know who to turn to."     -----इनलाइन अटैचमेंट इसके बाद आ रहा है----- No virus found in this incoming message. Checked by AVG - www.avg.com Version: 8.5.409 / Virus Database: 270.13.114/2401 - Release Date: 09/28/09 17:53:00

Time to Roll Back MAT- by CA. T.N.Manoharan

Time to roll back MAT

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As the Direct Taxes Code has done away with various incentives, there is no case for continuing with MAT in any form whatsoever.

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— Kamal Narang

In its new form, MAT will be detrimental to capital-intensive industries.

T. N. Manoharan

There is a paradigm shift in the concept of Minimum Alternative Tax (MAT) as envisaged under the Direct Taxes Code (DTC). As against the 'book profit' base used in the present income-tax law to levy MAT, 'gross value of assets' is proposed to be considered as the basis in the DTC.

The logic, as explained in various forums so far on behalf of the Government, is that corporate entities which have scarce economic resources at their disposal should exploit them efficiently so as to make adequate profits, failing which they must end up paying 2 per cent of the gross value of the assets as MAT.

Price on inefficiency

Only if the tax calculated on the profits made is more than the MAT can a company can avoid the tax, and not otherwise. According to informed sources, it is perceived as a liability imposed on companies for inefficiency or to discourage suppression of profits earned.

Further, the ability to invest in assets is also perceived as an indicator of the capability to pay tax. If any company finds it difficult to bear the brunt of MAT, the message is to hand over ownership and control to someone else who can manage the assets more efficiently to earn profits on which the tax liability surpasses MAT obligation.

Government, no doubt, has the prerogative to choose any criteria to determine the tax levy on a person and make it appear reasonable as well as logical. Nevertheless, the acceptability of such criteria from the perspective of the country's economic growth and taxpayer compliance needs to be examined.

Fundamentally, the 'value of assets' is a good base for levy of wealth tax, but certainly not for calculation of income-tax. Economically, this approach is detrimental to capital-intensive industries, especially infrastructure-related businesses, and puts the service sector at an advantage.

In a situation where India is striving to attract more investments and, at the same time, improve infrastructure facilities, one has to ponder the desirability of this move. The country needs to strengthen the manufacturing sector vis-À-vis China's, and this proposal in the DTC will not help achieve it. Again, there will be discrimination between similar businesses carried on by companies and unincorporated bodies such as partnership firms and LLPs which are not covered within the ambit of MAT.

Earlier, the concept of Fringe Benefit Tax (FBT), borrowed from Australia and New Zealand, was deleted by the Finance Act, 2009 after four years of implementation owing to strong resentment from taxpayers.

MAT seems to be partly borrowed from Argentina's tax code. In Argentina, however, there is allowance for the gestation period when an industry does not make profits not because of inefficiency but due to high cost of operations initially and depreciation allowance.

The rate, it is understood, is only 1 per cent against 2 per cent sought to be adopted in India for non-banking companies (banking companies 0.25 per cent). Above all, in a country where accounting standards are in vogue for about 32 years and where the revenue department has a strong mechanism for unearthing concealed income, such ad hoc introduction of MAT to make revenue collection easy will hamper growth in investment and dampen the spirit of industrialisation.

If an analysis is made with reference to certain listed companies which are in the capital-intensive field, aggregation of net block of fixed assets, capital work-in-progress, investments and current assets turns out to be substantial.

In select cases, the percentage of MAT to sales of the company works out to anywhere between 8 and 24 in which case MAT would drain those companies of their internal accruals, which otherwise normally get ploughed back into business.

Questionable rationale

Though the proposed concept may be plausible, the rationale for adopting the 'gross value' as a yardstick is questionable. It has to be 'net value' as otherwise there will be inequity between companies A and B with same gross value of assets but differently leveraged ending up paying the same MAT amount.

It is possible that A has invested own funds with hardly any debt funding whereas B might have substantially acquired the assets out of borrowings. In this example, it would be illogical to presume that the ability to pay taxes is equal only by reckoning the gross value of assets.

It is possible that B incurs losses in the initial years only because of heavy finance charges and, ironically, it would be burdened with MAT also at par with A.

Further, if this example is modified to assume that A is in a non-priority sector because of which it could not get bank funding, whereas B is in a high priority segment and gets bank lending support, MAT would prove to be counterproductive by adding to the project cost annually and may even affect its feasibility by extending its gestation period.

MAT does not provide for relief in calculation of gross value of assets in the case of holding and subsidiary companies. If there is a holding company and subsidiary company, there would be double taxation under MAT as the same amount would be included in the holding company's case as investment and in the subsidiary's case in the form of assets funded by that investment.

If there is a scenario of multiple subsidiaries, where D is a subsidiary of C, C of B, and B of A, the levy gets duplicated at multiple levels as there is no exclusion provided for.

Even when book profit is kept as an alternative base for MAT under the existing law, credit is allowed to be carried forward to be set off against tax on normal profits within 10 years. This principle of fairness is omitted in the DTC by declaring that MAT is a final tax and no credit would be allowed.

The DTC has many welcome provisions and features. The endeavour of writing the Code on a clean slate requires to be commended and the simplicity sought to be achieved appreciated. But a few areas of concern should be addressed by the Government, and MAT tops the list. One should remember that MAT found its way into tax legislation on the ground that companies showed book profit to declare dividend but returned loss for tax purpose by utilising various incentives. As the DTC has done away with all those incentives, there is no case for continuing with MAT in any form whatsoever.

(The author is a Chennai-based chartered accountant.)

New initiative of Govt of India

Government of India has an online Grievance forum at http://www.pgportal.gov.in Can you imagine this is happening in INDIA ? The govt. wants people to use this tool to highlight the problems they faced while dealing with Government officials or departments like (all hyperlinks given below links to respective dept/office site) 1) Railways 2) Posts 3) Telecom (incl. Bharat Sanchar Nigam Limited (BSNL) & Mahanagar Telephone Nigam Limited (MTNL) 4) Urban Development (Delhi Development Authority (DDA), Land & Development Office (L&DO), Central Public Works Department (CPWD), etc) 5) Petroleum & Natural Gas 6) Civil Aviation (Air India, Airports Authority of India, etc) 7) Shipping, Road Transport & Highways 8) Tourism 9) Public Sector Banks Allahabad Bank Andhra Bank Bank of Baroda Bank of India Bank of Maharashtra Canara Bank Central Bank of India Corporation Bank Dena Bank Indian Bank Indian Overseas Bank Industrial Development Bank of India Ltd National Bank for Agriculture and Rural Development Oriental Bank of Commerce Punjab & Sind Bank Punjab National Bank Small Industries Development Bank of India State Bank of Bikaner & Jaipur State Bank of Hyderabad State Bank of India State Bank of Indore State Bank of Mysore State Bank of Patiala State Bank of Travancore Syndicate Bank UCO Bank Union Bank of India United Bank of India Vijaya Bank 10) Public Sector Insurance Companies GIC of India Life Insurance Corporation of India National Insurance Company Ltd. The New India Assurance Company Ltd. The Oriental Insurance Company Ltd. United India Insurance Company Ltd. 11) National Saving Scheme of Ministry of Finance 12) Employees' Provident Fund Organization 13) Regional Passport Authorities Regional Passport Office, Ahemadabad Regional Passport Office, Amritsar Regional Passport Office, Bangalore Regional Passport Office, Bareilly Regional Passport Office, Bhopal Regional Passport Office, Bhubaneswar Regional Passport Office, Chandigarh Regional Passport Office, Chennai Regional Passport Office, Cochin Regional Passport Office, Coimbatore Regional Passport Office, Dehradun Regional Passport Office, Delhi Regional Passport Office, Ghaziabad Regional Passport Office, Goa Regional Passport Office, Guwahati Regional Passport Office, Hyderabad Regional Passport Office, Jaipur Regional Passport Office, Jalandhar Regional Passport Office, Jammu Regional Passport Office, Kolkata Regional Passport Office, Kozhikode Regional Passport Office, Lucknow Regional Passport Office, Madurai Regional Passport Office, Malappuram Regional Passport Office, Mumbai Regional Passport Office, Nagpur Regional Passport Office, Patna Regional Passport Office, Pune Regional Passport Office, Raipur Regional Passport Office, Ranchi Regional Passport Office, Shimla Regional Passport Office, Srinagar Regional Passport Office, Surat Regional Passport Office, Thane Regional Passport Office, Trichy Regional Passport Office, Trivandrum Regional Passport Office, Visakhapatnam 14) Central Government Health Scheme 15) Central Board of Secondary Education 16) Kendriya Vidyalaya Sangathan 17) National Institute of Open Schooling 18) Navodaya Vidyalaya Samiti 19) Central Universities 20) ESI Hospitals and Dispensaries directly controlled by ESI Corporation under Ministry of Labour Many of us say that these things don't work in India . Couple of months back, the Faridabad Municipal Corporation laid new roads in the area and the residents were very happy about it. But two weeks later, BSNL dug up the newly laid roads to install new cables which annoyed all the residents. A resident used the above listed grievance forum to highlight his concern. To his surprise, BSNL and Municipal Corporation of Faridabad were served a show cause notice and the guy received a copy of the notice in one week. Government has asked the FMC and BSNL about the goof up as it's clear that both the government departments were not in sync at all. So use this grievance forum and educate others who don't know about this facility. This way we can at least raise our concerns instead of just talking about the 'System' in India

Five bureaucrats from IRS framed the New Direct Tax Code

THE New Direct Tax Code which was drafted in secrecy for over five years, was a product of mainly five North Block bureaucrats from Indian Revenue Service (IRS).  Whereas Arbind Modi, a 1981 batch IRS and currently joint secretary in Tax Policy Legislation (TPL) division of the revenue department has already been known as an "Architect of the Code", there are four others who too were closely engaged in preparing the document which is likely to replace the I-T Act of 1961, provided Parliament gives its nod.  In fact, Central Board of Direct Taxes (CBDT), the apex body on direct tax matters, was not involved in the preparation of the code and some former chairmen of the Board were not even aware of the content of the document before it came out in public domain.  Ms Anita Kapur who is now shifted to foreign tax division (FTD) of the revenue department, shared a major part of the workload of drafting of the code with Mr Modi. Mr Modi who is now engaged with finmin's effort to sensitise the code by organising public meets, is the only officer in TPL section who was a part of the original team of drafting of the code.  Mr D P Semwal, who was a director in revenue department from November 2001 to January 2008, handled the draft code's sections such as tax deducted at source (TDS), advance tax collection etc. His batchmate in IRS and fellow director Mr Sharat Chandra was given procedural matters, penalty, filing of returns etc.  Architects Of The Code Anita Kapur: 1978 batch IRS, now in Foreign Tax Division Arbind Modi: 1981 batch IRS, still a Joint Secretary at TPL D P Semwal : 1985 batch IRS, now I-T Commissioner at Dehradun Sharat Chandra: 1985 batch IRS, took VRS to join a private company Pragya Sahay: 1987 batch IRS   Source: The Economic Times Five bureaucrats from IRS framed the New Direct Tax Code THE New Direct Tax Code which was drafted in secrecy for over five years, was a product of mainly five North Block bureaucrats from Indian Revenue Service (IRS).  Whereas Arbind Modi, a 1981 batch IRS and currently joint secretary in Tax Policy Legislation (TPL) division of the revenue department has already been known as an "Architect of the Code", there are four others who too were closely engaged in preparing the document which is likely to replace the I-T Act of 1961, provided Parliament gives its nod.  In fact, Central Board of Direct Taxes (CBDT), the apex body on direct tax matters, was not involved in the preparation of the code and some former chairmen of the Board were not even aware of the content of the document before it came out in public domain.  Ms Anita Kapur who is now shifted to foreign tax division (FTD) of the revenue department, shared a major part of the workload of drafting of the code with Mr Modi. Mr Modi who is now engaged with finmin's effort to sensitise the code by organising public meets, is the only officer in TPL section who was a part of the original team of drafting of the code.  Mr D P Semwal, who was a director in revenue department from November 2001 to January 2008, handled the draft code's sections such as tax deducted at source (TDS), advance tax collection etc. His batchmate in IRS and fellow director Mr Sharat Chandra was given procedural matters, penalty, filing of returns etc.  Architects Of The Code Anita Kapur: 1978 batch IRS, now in Foreign Tax Division Arbind Modi: 1981 batch IRS, still a Joint Secretary at TPL D P Semwal : 1985 batch IRS, now I-T Commissioner at Dehradun Sharat Chandra: 1985 batch IRS, took VRS to join a private company Pragya Sahay: 1987 batch IRS   Source: The Economic Times

MERGER OF FIRMS – SENIORITY/ FIRM NAME ISSUES

ANNOUNCEMENT To give boost to the capacity building of the Chartered Accountants firms, the Council in its 250th meeting held in April 2005 had approved a scheme envisaging merger of two or more firms of Chartered Accountants into one firm so that larger firms could come into existence.    The Council in its 280th meeting held in August, 2008 while considering issues relating to seniority of firm and name of the merged firm as a consequence to the merger of firms restated that as and when two or more firms of Chartered Accountants merge, the seniority of the oldest firm amongst the merging firms will be given to the merged firm and the merging firms will have flexibility to choose a name of the merged firm provided the provisions of the Regulation 190 are duly met and the seniority will be reflected as deemed seniority in the firm constitution certificate.    While considering a specific question as to whether such a decision will also apply to previous merger cases (i.e. prior to August 2008), the Council in its 288th meeting clarified that the decision already taken by it in its 250th meeting held in April 2005 will apply to all merger cases which had taken place effective from April 2005 onwards i.e. the decision be given effect retrospectively.   In other words, the principles of seniority and choosing the name of merged firm in accordance with the above decision of the Council will be effective in respect of all merger of Chartered Accountants firms which have taken place from April 2005 onwards.   17th September 2009                                                                   Secretary Source http://icai.org/post.html?post_id=5007&c_id=219

ROC Empanelment

Announcement for panel for outsourcing of work of Technical Scrutiny of Balance Sheets - (23-09-2009)

ANNOUNCEMENT   Sub: Announcement for panel for outsourcing of work of Technical Scrutiny of Balance Sheets               The Institute has received an Office Memorandum (OM) from the Ministry of Corporate Affairs. As per the OM, the Registrar of Companies will prepare a panel of professionals for Technical Scrutiny of Balance Sheets filled by the Companies for the State concerned.               The Scheme of outsourcing the work will be for the financial year 2009-10.  The details of the Scheme specifying the eligibility criteria, mode of application, Procedure to be followed by the ROC for outsourcing of work, is provided in the Office Memorandum issued by the Ministry.                The Institute of Chartered Accountants of India while appreciating the initiative taken by the Ministry for ensuring good corporate governance and transparency for safeguarding the interest of the shareholders, creditors and the economy as a whole wishes to provide professional expertise of its members to the Registrar of Companies.  For the purpose, it has been decided to prepare a panel of the members of the Institute and send the same to the Ministry.                         Procedure for Registration for the empanelment:             Members fulfilling the eligibility and intending to empanel themselves may submit their application in Empanelment Form. After verification, the same will be included in the panel and forwarded to the Ministry of Corporate Affairs.                                   For any further clarification, the members can contact: Secretary, Corporate Laws Committee The Institute of Chartered Accountants of India ICAI Bhawan, Indraprastha Marg New Delhi-110002 Tel. No. 011-30110471 E-mail: corpoartelaws@icai.in / skgarg@icai.in

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CA. V.M.V.SUBBA RAO
Chartered Accountant
Door No.24-2-1885,
I Floor, Flat No.5,
Siddivinayaka Residency, I Cross,
Central Avenue, MSR Nagar,
Magunta Layout,
Nellore-524 003
Andhra Pradesh
India
Mobile:+91 - 0 9390221100
           +91 - 0 9440278412
e-Mail: vmvsr@rediffmail.com
           vmvsr@yahoo.co.uk

ITax - E-return - Amendment

AMENDMENT IN ELECTRONIC FURNISHING OF RETURN OF INCOME SCHEME, 2007

NOTIFICATION NO. 70/2009, DATED 22-9-2009

In exercise of the powers conferred by sub-section (1B) of section 139 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following amendment in the notification of the Government of India, in the Ministry of Finance (Department of Revenue), vide S.O. 1281(E) dated the 27th July, 2007, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section( ii), with effect from 27th July, 2007 (i.e. the date on which the Scheme came into force).

2. In the said notification for para 5, the following para shall be substituted, namely :-

5. Qualifications of an e-Return Intermediary. (1) An e-Return Intermediary shall have the following qualifications, namely:-

(a) it must be a public sector company as defined in clause (36A) of section 2 of the Act or any other company in which public are substantially interested within the meaning of clause (18) of section 2 of the Act and any subsidiary of those companies; or

(b) A company incorporated in India , including a bank, having a net worth of rupees one crore or more; or

(c) a firm of Chartered Accountants or Company Secretaries or Advocates, if it has been allotted a permanent account number; or

(d) a Chartered Accountants or Company Secretaries or Advocates or Tax Return Preparers, if he has been allotted a permanent account number; or

(e) a Drawing or Disbursing Officer (DDO) of a Government Department.

(2) The e-intermediary shall have at least class II digital signature certificate from any of the Certifying authorities authorized to issue such certificates by the Controller of Certifying authorities appointed under Section 17 of the Information Technology Act, 2002 (21 of 2000).

(3) The e-intermediary shall have in place security procedure to the satisfaction of e-Return Administrator to ensure that confidentiality of the assessees information is properly secured.

(4) The e-intermediary shall have necessary archival, retrieval and, security policy for the e-Returns which will be filed through him, as decided by e-Return Administrator from time to time.

(5) The e-intermediary or its Principal Officer must not have been convicted for any professional misconduct, fraud, embezzlement or any criminal offence.

[F.No.133/55/ 2008-TPL]

Permission for pursuing a course along articleship

Permission for pursuing a course along articleship [Regulations 65 & 78, Form 112] - (18-09-2009) Attention of the students /articled assistants is drawn to Regulation 65 of the Chartered Accountants Regulations, 1988, reproduced below: - "Without the previous permission of the Council, obtained on application made in the approved form, no articled assistant shall, during the period of his service as an articled assistant, take any other course of study or training, whether academic or professional, or engage in any business or occupation." Of late, it has been noted with concern that the students / articled assistants have not been adhering to the requirements of the aforesaid Regulations while pursuing another course alongwith articleship and have been declaring such a fact while applying for enrolment as a Member of the Institute and seeking condonation for Breach of Regulation 65 /78 for having not taken the permission at the appropriate time. The Executive Committee while considering such cases expressed its anguish and exhorted the students / articled assistants to pursue only one course alongwith articleship, even that be a graduation course and seek permission of the Council by filing of Form 112 duly certified by the Principal i.e. Chartered Accountant and the Principal of the College concerned within 30 days of taking admission. The Executive Committee has further noted that the additional course(s) has / have been pursued by the students / articled assistants in violation of the provisions of Regulation 65/ 78 and directed that all requests including cases for which condonation requests have been received be dealt with, in terms of the guidelines, provided herein below: - Period of Delay Condition(s) to be complied with by the student for condonation of delay in filing of Form 112. Upto 1 year Condone the breach of Regulation 65 and enroll, after three months, from the date of the meeting at which a decision is taken for condonation. More than 1 year but upto 3 years Condone the breach of Regulation 65 and enroll, after six months, from the date of the meeting at which a decision is taken for condonation. More than 3 years but upto 5 years Condone the breach of Regulation 65 and enroll, after one year, from the date of the meeting at which a decision is taken for condonation. More than 5 years but upto 7 years Condone the breach of Regulation 65 and enroll, after two years, from the date of the meeting at which a decision is taken for condonation More than 7 years but upto 10 years Condone the breach of Regulation 65 and enroll, after two years, from the date of the meeting at which a decision is taken for condonation as well as on completion of the three months' Residential Course More than 10 years Condone the breach of Regulation 65 and enroll, after three years, from the date of the meeting at which a decision is taken for condonation as well as on completion of the three months' Residential Course. The Committee further decided that the students / articled assistants who have not so far taken permission for pursuing additional course alongwith articleship are required to file Form 112 duly completed with the Institute on or before 31st December, 2009 and thereafter no request for Breach of Regulation 65 / 78 will be considered for condonation. It is clarified that similar provisions will apply to the audit assistants mutatis mutandi. The above decisions of the Executive Committee are brought to the attention of the Students / articled assistants / audit assistants for necessary compliance. Secretary 14th September, 2009

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Systems Audit of Mutual Funds - DISA??

Systems Audit of Mutual Funds

Circular No. SEBI/IMD/CIR No. 8/176988/2009, dated 16-9-2009

 

Considering the importance of systems audit in the technology driven asset management activity, it has been decided that mutual funds shall have a systems audit conducted by an independent CISA/CISM qualified or equivalent auditor.

The systems audit should be comprehensive encompassing audit of systems and processes inter alia related to examination of integration of front office system with the back office system, fund accounting system for calculation of net asset values, financial accounting and reporting system for the AMC, Unit-holder administration and servicing systems for customer service, funds flow process, system processes for meeting regulatory requirements, prudential investment limits and access rights to systems interface.

Accordingly, you are advised to get the above systems audit conducted once in two years. You are further advised to place the Systems Audit Report and compliance status before the Trustees of the mutual fund. The systems audit report/findings alongwith trustee comments should be communicated to SEBI.

For the financial years April 2008 – March 2010, the systems audit should be completed by September 30, 2010.

This circular is being issued in exercise of the powers conferred by Section 11(1) of Securities and Exchange Board of India Act, 1992, read with the provisions of Regulation 77 of the SEBI (Mutual Funds) Regulations, 1996, to protect the interests of investors in securities and to promote the development of, and to regulate, the securities market.

 

--
CA. V.M.V.SUBBA RAO
Chartered Accountant
Door No.24-2-1885,
I Floor, Flat No.5,
Siddivinayaka Residency, I Cross,
Central Avenue, MSR Nagar,
Magunta Layout,
Nellore-524 003
Andhra Pradesh
India
Mobile:+91 - 0 9390221100
           +91 - 0 9440278412
e-Mail: vmvsr@rediffmail.com
           vmvsr@yahoo.co.uk