CBDT on Section 154

Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes

North Block, New Delhi, the 15th of February, 201016

Subject: Following the prescribed time limit in passing order under sub-section (8) of 154 of Income tax Act, 1961-regd

Sub-section (8) of section 154 of the Income-tax Act, 1961 ('Act') stipulates that where application for amendment is made by assessee/deductor/collector with a view to rectify any mistake apparent from record, the income-tax authority concerned shall pass an order, within a period of six months from the end of the month in which such an application is received, by either making amendment or refusing to allow the claim. It has been brought to the notice of the Board that the said time limit of six months has not been observed in deciding some applications. In such cases, the authorities often take a view that since no action was taken within the prescribed time-frame, application of the taxpayer is deemed to have lapsed, thereby not requiring any action.

2. The matter has been examined by the Board. In this regard, the undersigned is directed to convey that the aforesaid time-limit of six months is to be strictly followed by Assessing Officer while disposing applications filed by the assessee/deductor/collector under section 154 of the Act. The supervisory officers should monitor the adherence of prescribed time limit and suitable admin action may be initiated in cases where failure to adhere to the prescribed time frame is noticed.

3. The contents of this Instruction may be brought to the notice of all for necessary compliance.

4. Hindi version to follow.

(Rohit Garg)
Deputy Secretary to the Government of India

(F. No. 225/305/2015-ITA.II)

 

 

 

 

 

 

 

 

 

 

 

 

Instruction No. 01/2016

Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes

North Block, New Delhi, the 15th of February, 201016

Subject: Passing rectification order under section 154 Income Tax Act, 1961-regd

Instances have come to the notice of the Board that in some cases, rectification order under section 154 of the Income Tax Act, 1961 ('Act') is being passed by the Assessing Officer on AST system without giving copy of the order to the taxpayer concerned. This is causing grievance to the taxpayers as they remain unaware of such order s and consequently, are unable to pursue the matter further, either in appeal or rectification, if required.

2. Sub-section (4) of section 154 of the Act mandates that rectification order shall be passed in writing by the Income Tax authorities. Therefore, on consideration of the matter, the Board hereby directs that all rectification applications must be disposed of after passing an order in writing, to be duly served upon the taxpayers concerned and not by merely marking necessary rectification on the AST System.

3. The contents of this instruction may be brought to the notice of all for necessary compliance.

4. Hindi version to follow.

(Rohit Garg)

Deputy Secretary to the Government of India

Draft Format of Financial Statements

MCA issues draft format for financial statements in line with Ind AS   On 9th February, 2016, Ministry of Corporate Affairs issued draft format for financial statements (Revised Schedule III) in line with Indian Accounting Standards (Ind AS). The said format, if approved, shall be applicable on companies who are applying Ind AS voluntarily or shall apply mandatorily w.e.f 1st Aril 2016 or 1st April, 2017, as the case may be which is specified in Companies (Indian Accounting Standards) Rules, 2015.   Proposed revised Schedule III is similar to existing Schedule III of the Companies Act, 2013 subject to some differences. The major differences are as follows:   (i) The first half of the balance sheet requires presentation of assets and second part requires presentation of equity and liabilities, unlike present schedule III which requires presentation of equity and liabilities first and then assets.   (ii) Investment property, biological assets other than bearer plants, financial assets (categorised into investments, trade receivables, loans and others) shall be disclosed on the face of balance sheet under 'Non-current assets'.   (iii) Reserves and surplus, money received against share warrants and share application money pending allotment shall be clubbed into a single heading "Other Equity" in the balance sheet.   (iv) "Other non-current assets" shall be classified into capital advances and advances other than capital advances.   (v) Preference shares shall be classified and presented as 'Equity' or 'Liability' in accordance with the requirements of relevant Ind AS.   (vi) The Statement of profit and loss will include profit (a) profit or loss for the period; and (b) other comprehensive income for the period.   Stakeholders can provide their comments on the draft by 23rd February, 2016.   

Investment Thumb rules

Few thumb rules help in financial decisions-

1) 100 minus our age should be our equity allocation.

2)Minimum  20 times of our yearly income should be our retirement fund.

3) We all should save minimum 30% of our income

4) Cost of our house should not be more than 6 to 8 times of our family income.

5) EMI should not be more than 35% of our gross monthly income. Zero is the best answer.

6) Rate of returns ideally should beat inflation.

7) Rule of 72 & 115......
How many years double or triple our money ?
* 72/Returns= double in yrs
* 115/ returns = triple in yrs.

8) Rule of 70= Future buying power of your money.
*70/Inflation= Number. of yrs.

9) Life cover should be  Minimum 8 to 10 times of your yearly income.

10) We should keep 3 to 6 months expenses as an emergency fund.

Moral-
Peple want shortcuts, that's why thumb rules find some place.

Wish you all decipline investing with thumb rules. 😊👍

Guidelines relating to Paperless Assessment Proceedings

CBDT Notification No. 2/2016 dt February 3, 2016: Guidelines relating to Paperless Assessment Proceedings

1. The AO shall issue notice(s) from his official email address (having domain name @incometax.gov.in) and shall attach scanned copies of the notice(s) u/s 143(2) or 142(1) containing his signatures in a PDF file(s).
2. The assessee shall also respond from his primary registered email address with PDF attachment(s). The assessee is entitled to furnish a letter to the AO informing any other alternative email address of his choice.
3. The AO shall place hard copies of all emails and supporting documents in the relevant assessment file for record purposes
4. For keeping audit trail of all e-notices/questionnaire issued by the Tax Officer to assessee and e-response by assessee thereof with supporting documents, a copy of email shall be marked to E-ASSESSMENT@INCOMETAX.GOV.IN
5. All emails sent or received as per this procedure shall be stored in the ITD database and its communication status shall be displayed in assessee's "My Account" on the E-filing portal.
6. The Tax Officer shall pass the Order and email the scanned copy of assessment order to assessee.

Manner of Signing of Certificates by Chartered Accountant

💥ICAI released an announcement on Manner of Signing of Certificates by Chartered Accountant

With a view to bring uniformity in the manner of signing of certificates, icai has decided to require the members of the ICAI to include (in addition to any other requirements in this regard prescribed by the relevant law or regulation under which the certificate is being issued) the following details in their “Signatures” on the certificates issued by them:

1)Name of the CA firm* 

2) Firm Registration Number (FRN)* 

3) Name of the member 

4) Designation (Partner/Proprietor)

5) Membership Number 

Link: http://resource.cdn.icai.org/41158aasb30942announ.pdf

Rebate/refund of SB Cess on exports & services used in SEZ; Cenvat credit cannot be used for SB Cess & others

Dear Professional Colleague,

Rebate/refund of SB Cess on exports & services used in SEZ; Cenvat credit cannot be used for SB Cess & others

The Central Government ("CG") has issued various Notifications under the Service tax and the Central Excise for extending the benefit of refund/rebate to the Swachh Bharat Cess ("SB Cess") component and the input services used beyond factory for export. Further, the Cenvat Credit Rules, 2004 ("the Credit Rules") has been amended to allow Cenvat credit on commission agent's services and to make explicit that Cenvat credit shall not be used for payment of SB Cess.

Gist of all the Notifications is discussed hereunder for easy digest:

Rebate of Service tax on services used beyond the factory or any other place/premises of production/manufacture of goods, for their export

The CG vide Notification No. 01/2016-Service Tax dated February 3, 2016 ("Notification No. 1") has amended Notification No. 41/2012-Service Tax dated June 29, 2012 (Rebate of Service tax paid on the taxable services which are received by an exporter of goods and used for export of goods) ["Notification No. 41"] to include the taxable services that have been used beyond factory or any other place or premises of production or manufacture of the goods, for their export, in the case of excisable goods, under the definition of 'specified services'. Further, clause (B) of Notification No. 41 prescribing definition of 'place of removal' as the one defined under Section 4(3)(c) of the Central Excise Act, 1944, has also been deleted.

Increase in the rate of refund commensurate to the increased Service tax rate

The CG vide Notification No. 1 has further amended Notification No. 41 to increase the rate of refund commensurate to the increased Service tax rate in the following manner:

"(b) in the Schedule of rates, in column (4),-

(i) for the  figures 0.04, wherever they occur, the figures 0.05 shall be substituted;

(ii) for the  figures 0.06, wherever they occur, the figures 0.07"shall be substituted;

(iii) for the  figures 0.08, wherever they occur, the figures"0.09"shall be substituted;

(iv) for the  figures 0.12, wherever they occur, the figures 0.14"shall be substituted;

(v) for the figures 0.18, wherever they occur, the figures 0.21"shall be substituted; and

 (vi) for the  figures 0.20, wherever they occur, the figures"0.23"shall be substituted"

To view full Notification No. 1, please click on the link below:

http://www.cbec.gov.in/htdocs-servicetax/st-notifications/st-notifications-2016/st01-2016

Refund of SB Cess paid on specified services used in Special Economic Zone ("SEZ")

The CG vide Notification No. 02/2016-Service Tax dated February 2, 2016 ("Notification No. 2") has amended Notification No. 12/2013-Service Tax dated July 1, 2013 (Exemption on services received by units located in a SEZ or Developer of SEZ and used for the authorised operation) to enable the SEZ Unit or the Developer for refund of the SB Cess paid on the specified services on which ab-initio exemption is admissible but not claimed.

Further, the refund of amount distributed to the SEZ Unit or the Developer in the manner as prescribed in Rule 7 of the Credit Rules, will be determined by multiplying total Service tax distributed to the SEZ Unit or the Developer in the manner as prescribed in Rule 7 of the Credit Rules by effective rate SB Cess and dividing the product by rate of Service tax specified in Section 66B of the Finance Act, 1994.

To view full Notification No. 2, please click on the link below:

http://www.cbec.gov.in/htdocs-servicetax/st-notifications/st-notifications-2016/st02-2016

Rebate of SB Cess paid on all the input services used in providing services exported

The CG vide Notification No. 03/2016-Service Tax dated February 3, 2016 ("Notification No. 3") has amended Notification No. 39/2012-Service Tax dated June 20, 2012 (Rebate of the duty paid on excisable inputs or Service tax and cess paid on all input services used in providing service exported) to insert SB Cess under the definition of 'service tax and cess', to enable the provider of services to claim rebate of SB Cess paid on all the input services used in providing services exported in terms of Rule 6A of the Service Tax Rules, 1994.

To view full Notification No. 3 please click on the link below:

http://www.cbec.gov.in/htdocs-servicetax/st-notifications/st-notifications-2016/st03-2016

Cenvat credit shall not be used for payment of SB Cess

The CG vide Notification 02/2016-CE(NT) dated February 3, 2016 ("Excise Notification No. 2"), has amended Rule 3(4) of the Credit Rules, to insert a proviso providing that Cenvat credit shall not be used for payment of SB Cess.

It may also be noted here that the Central Board of Excise and Customs in their Frequently Asked Questions released on November 14, 2015 on SB Cess, had specifically provided that because SB Cess is not integrated in the Cenvat credit chain, its credit is not admissible:

"Q.14 Whether Cenvat Credit of the SBC is available?

Ans. SBC is not integrated in the Cenvat Credit Chain. Therefore, credit of SBC cannot be availed. Further, SBC cannot be paid by utilizing credit of any other duty or tax"

Cenvat credit admissible on services of sales commission agent

The CG vide Excise Notification No. 2 has further amended the definition of 'input services' under Rule 2(l) of the Credit Rules, to allow Cenvat credit of Service tax paid on sale of dutiable goods on commission basis, by inserting following explanation after sub-clause (C):

"Explanation.-For the purpose of this clause, sales promotion includes services by way of sale of dutiable goods on commission basis."

It may not be out of place here to mention that in view of the conflicting judgments, eligibility to avail Cenvat credit of the services rendered by a commission agent has been a subjective issue. The Hon'ble High Court of Gujarat in the case of Commissioner of C. Ex., Ahmedabad-II Vs. Cadila Healthcare Ltd. [2013 (30) S.T.R. 3 (Guj.)], has disallowed Cenvat credit on commission agent's services whereas, the Hon'ble Punjab & Haryana High Court in the case of Commissioner of Central Excise, Ludhiana Vs. Ambika Overseas [2012 (25) S.T.R. 348) had allowed the Cenvat credit. Thus, with the insertion of stated explanation, it may be contended by the assessees that because the same is clarificatory which was being disputed on the basis of divergent judgments, therefore, it would have retrospective effect.

To view full Excise Notification No. 2 please click on the link below:

http://www.cbec.gov.in/htdocs-cbec/excise/cx-act/notifications/notfns-2016/cx-nt2016/ cent 02-2016

Hope the information will assist you in your Professional endeavours. In case of any query/ information, please do not hesitate to write back to us.

Thanks & Best Regards,

Bimal Jain

6 Changes in Name Availability

6 changes you must know for registration of company's name under new Rules

The Govt. has notified the Companies (Incorporation) Amendment Rules, 2016 ('Amended Incorporation Rules'). Now the process of reservation of name of companies has been simplified. Following changes have been made for ease of doing business in India:

1) Name of company need not to be in consonance with principal object:

Under extant norms, the company's name was necessarily required to be in consonance with principal object, if such name resembled any object of company. Now as per the amended Rules the name of company will not be considered undesirable even if it is not in consonance with the principal objects of the company as set out in Memorandum of association. Let us understand this condition with the help of an example. Suppose if a company wants to opt its name as 'ABC Builders Pvt. Ltd.' then it is not necessary that its principal object should be related to construction and development only. Thus, now company is free to choose such name which is not in consonance with principal object.

2) Usage of vague or an abbreviated name:

Under the extant norms there was restriction on usage of vague and abbreviated name. How many of us knows about ANI Technologies Pvt. Ltd but if one would say 'OLA' then most us might have heard of it and even enjoyed its first free ride. 'OLA' could have registered its name containing 'OLA' if there was no such restriction on usage of abbreviated name. The Amended rules does away with restriction on usage of vague and abbreviated name. Now a company can use either vague or an abbreviated names such as 'ABC limited' or '23K limited' or 'DJMO' Ltd.

3) No need to change name on change in business activity:

As per the extant norms if any company has changed its activities which are not reflected in its name then it would be required to change its name in line with its activities. However, such requirement has now been done away with under the amended Rules.

4) Central registry to dispose of name reservation application:

Now an application for the reservation of a name made in INC.1 shall be approved or rejected by the Registrar, Central Registration Centre. Earlier, the authority to dispose application for reservation of name was with respective ROCs.

5) Additional opportunity to remove defects:

Now while going for the fast-track mode of incorporation the registrar can give third opportunity to company to remove such defects or deficiencies.

6) Usage of Name containing Name of other person:

Under the extant norms, in case the key word used in the proposed name of a company is the name of a person other than the name(s) of the promoters or their close blood relatives, then NOC from such other person(s) and the proof of relation were required to be attached, respectively. Now such requirement of furnishing NOC and proof of relation has been removed.

(Source:taxmann)

AP VAT 24 Amendments at Glance

The Andhra Pradesh Value Added Tax (Amendment) Act,2016

24 Amendments Made at Glance

Sl. No.	Section	Nature of Amendment
01		Governor of AP has given assent on 8th January,2016 Published in Official Gazettee on 12th January,2016
02	Section 2(47)	A new definition for "Zero Rated Sales" replacing the old definition "Zero Rate Sales" means the sales which are taxable at the rate of Zero and which are also eligible for input tax credit subject to the conditions as may be prescribed". Prescribed conditions to be notified.
03	Section 4(4)(iv)	To levy purchase tax where goods after purchase are dispatched to place outside the State otherwise than by Sale in course of inter-state trade and commerce or export out of Indian territory.
04	Section 4-A	Imposing tax @ 0.5% on Sale of HSD and Furnace Oil to Foreign Outgoing International Ships. Imposing tax @ 5% on Sale of Furnace Oil to Coastal Ships.
05	Section 13(3)(aa)	Imposes requirement of payment of tax by selling dealer in respect of goods on which input tax credit has been claimed in terms of Section 13(3) w.e.f. April 1,2015
06	Section 21(1A)	Requires every VAT dealer to furnish Certificate of Audit of Accounts duly certified by Chartered Accountant for every financial year, by December 31 subsequent to financial year to which statements relate, and failure to furnish will attract penalty of Rs.3,000 per day of delay from due date till actual submission. Rules and Forms to be prescribed for audit of accounts of VAT dealer
	Section 21(1B)	Requires every TOT dealer to furnish Certificate of Audit of Accounts duly certified by Sales tax Practitioner  every financial year, by December 31 subsequent to financial year to which statements relate, and failure to furnish will attract penalty of Rs.3,000 per day of delay from due date till actual submission. Chartered Accountant is not eligible to certify accounts of TOT Dealer Rules and Forms to be prescribed for audit of accounts of VAT dealer
07	Section 22(3B) Section 22(4)	New Section substituted Tax Deducted at Source on Sale of Prescribed Goods Recovery proceedings introduced for non payment of tax at source Penalty leviable on non payment of TDS W.E.F  23/09/2015
08	Section 31	Notify the period of time to be excluded for the purpose of computation of the time limit for filing of appeals
09	Section 32	Section 32(5) has been omitted Section 32(6) & (7) have been substituted.
10	Section 34	The period of petition to High Court has been increased from 90 days to 120 days
11	Section 38 (6)	Rate of Interest on  refund of tax has been increased from 1% to 1.25% pm
12	Section 39(2)	Rate of Interest on  late refund of tax has been increased from 1% to 1.25% pm
13	Section 45 (3)(b)(ii) 4(3)	Check Post authority can verify way bill also Compulsory furnishing of Security for an amount equal to two (2) times the amount of tax payable. The detained vehicle shall be released only after the payment of tax and security furnished.
14	Section 47	Radio Frequency Identification (RFID) Tag or any other Tracking device offered by the department introduced in addition to transit pass Minimum Penalty of Rs.10,000/- for fails to carry RFID
15	Section 48 (a)	Now owner of goods vehicle is required to produce way bill
16	Section 48-A	Penalty for owner of goods vehicle unable to produce required documents at check post
17	Section 56-A	Penalty for failure to upload the details of tax invoices Penalty @5% of total turnover covered by such invoices Before levy of penalty reasonable opportunity to be given
18	Section 57 (5)	No order for the forfeiture of tax shall be made after expiration of 6 years from the date of collection of tax instead of 3 years at present
19	Section 59	Now Driver or Incharge of vehicle is also punishable with imprisonment with fine (earlier only any dealer) Offences of obstructing the authority or not stopping the goods vehicle or vessels. Imprisonment – Minimum One Month- Maximum 6 Months with fine
20	Section 61	"Transporter" is also allowed for compounding of offences. Transporter Compounding – Rs.1,00,000/-
21	Section 63	Failure to attend summons VAT Dealer Penalty Rs.1,000/- for every day of delay after 30 days from the date of summons/notice issued Maximum Rs.30,000/- TOT Dealer Penalty Rs.350/- for every day of delay after 30 days from the date of summons/notice issued Maximum Rs.10,000/- Other Persons Rs.500/- per day Maximum Rs.15,000/-
22	Schedule I	Entry Section 57  substituted with Sugar including Khandasari Sugar
23	Schedule IV	Industrial Inputs Item 236 Furnace Oil
24	Schedule VI	Revised Rates for levy of tax at the point of first sale in the State for a.       India Made Foreign Liquor b.      Beer c.       Wine d.      Ready to Drink Varieties (RTD)

Women Can be a Karta of HUF

WOMEN CAN BE A KARTA IN HUF

In a recent judgment, Delhi High Court has ruled that after Hindu Succession (Amendment) Act, 2005 there is no reason why Hindu women should be denied the position of a Karta. If a male member of an HUF, by virtue of his being the first born eldest, can be a Karta, so can a female member.

Case Law Details:

CS(OS) 2011/2006

Mrs. Sujata Sharma (Plaintiff) vs Shri Manu Gupta (Defendent)

Date of Judgment: 22-12-2015

Coram: Justice Najmi Waziri

Facts of the Case(s):

In the present case, a suit was filed by the eldest daughter of HUF claiming her right to be Karta of HUF and challenging her cousin brother's claim after the passing of her father and three uncles.

Question before the Court

Whether the eldest female, being the first born amongst the co-parceners of the HUF property, would by virtue of her birth, be entitled to be its Karta?

Excerpts from the Judgment:

The learned counsel for the plaintiff further relies upon the 174th Report of the Law Commission of India, which has argued that when women are equal in all respects of modern day life, there is no reason why they should be deprived of the right and privilege of managing HUF as their Karta. She argues that it is in this context, that Section 6 was so formulated that it covers all aspects of succession to a coparcener which are available to a male member to be equally available to a female member also.

It is rather an odd proposition that while females would have equal rights of inheritance in an HUF property, this right could nonetheless be curtailed when it comes to the management of the same. The clear language of Section 6 of the Hindu Succession Act does not stipulate any such restriction.

What emerges from the above discussion, is that the impediment which prevented a female member of a HUF from becoming its Karta was that she did not possess the necessary qualification of co-parcenership. Section 6 of the Hindu Succession Act is a socially beneficial legislation; it gives equal rights of inheritance to Hindu males and females. Its objective is to recognise the rights of female Hindus as co-parceners and to enhance their right to equality apropos succession. Therefore, Courts would be extremely vigilant apropos any endeavour to curtail or fetter the statutory guarantee of enhancement of their rights. Now that this disqualification has been removed by the 2005 Amendment, there is no reason why Hindu women should be denied the position of a Karta. If a male member of an HUF, by virtue of his being the first born eldest, can be a Karta, so can a female member. The Court finds no restriction in the law preventing the eldest female co-parcener of an HUF, from being its Karta. The plaintiff‟s father‟s right in the HUF did not dissipate but was inherited by her. Nor did her marriage alter the right to inherit the co-parcenary to which she succeeded after her father‟s demise in terms of Section 6. The said provision only emphasises the statutory rights of females. Accordingly, issues 5, 6 and 8 too are found in favour of the plaintiff.

The eldest female member of a family can be its "Karta"

 The eldest female member of a family can be its "Karta", the Delhi high court has ruled in a landmark verdict. A unique position carved out by Hindu customs and ancient texts, "Karta" denotes managership of a joint family and is traditionally inherited by men.

"If a male member of a Hindu Undivided Family (HUF), by virtue of his being the first born eldest, can be a Karta, so can a female member. The court finds no restriction in law preventing the eldest female co-parcenor of an HUF, from being its Karta," Justice Najmi Waziri said in a judgment made public earlier this week.

The Karta occupies a position superior to that of other members and has full authority to manage property, rituals or other crucial affairs of the family. These include taking decisions on sale and purchase of family assets, mutation of property etc.

http ://m.timesofindia.com/india/Woman-can-be-kartaof-a-family-Delhi-high-court/articleshow/50799462.cms

SEBI Update

SEBI, on 19th January, 2016, has issued next set of FAQs on SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015

SEBI has given clarification with regard to many points in FAQs including 
a. definition of Associate Company as per Regulation 2(1)(b)
b. definition of Related Party as per Regulation 2(1)(zb)
c. Signing of Compliance certificate as per Regulation 17(8)
d. applicability of Regulation 24 on 'unlisted material subsidiary'
e. Limit on Directors to be a member in Committees as per Regulation 26(1)
f. Disclosure as per Regulation 30(8)
g. Definition of 'material subsidiary as per Regulation 16(1)(c)

The FAQs can be accessed at:
https://goo.gl/P7lA9f

clarification that HUF or Karta can not become Partner or Designated Par ter in LLP.

MCA  Circular dated 15th January, 2016

clarification  that HUF or Karta can not become Partner or Designated Par
ter in LLP.

http://mca.gov.in/Ministry/pdf/General_Circular_2_2016.pdf

STARTUP INDIA ACTION PLAN

Startup India DIPP http://dipp.nic.in/English/Investor/startupIndia/StartupIndia_ActionPlan_16January2016.pdf

10 Points Summary;

1 Tax exemption for start-ups for three years.

2 Rs. 10,000 crore corpus fund to support start-ups.

3 Capital gains tax to be exempted for venture capital investments.

4 80% reduction in patent registration fee.

5 Govt. to ensure 90-day window for start-ups to close businesses.

6 Self-certification compliance for start-ups across India.

7 No government inspection for three years for newly-formed start-ups.

8 New scheme to provide IPR protection to start-ups and new firms.

9 Innovation programme to start 5 lakh schools to target 10 lakh children.

10 Government is all set to launch an app to create a platform for interaction

FAQ on CSR

MCA issues FAQs on CSR   MCA has been receiving several queries and reference seeking further clarifications on various issues relating to CSR provisions and in this regard list of FAQs has been issued.
The key FAQs are as under  

  i. Applicability: CSR provisions shall be applicable to all companies satisfying the criteria laid down under Section 135 of the Companies Act, 2013 and relevant Rules.  

  ii. Tax benefits: With regard to the Tax benefits, it has been clarified that no specific tax exemptions that has been extended to CSR expenditure per se, however it clarified that spending on certain activities like contributions to Prime Minister's Relief fund, Scientific research , Rural development projects, skill development projects, agricultural extension projects etc. prescribed in Schedule VII already enjoy exemptions under different provisions of Income Tax Act, 1961  

 iii. Computation of Average net profit: With respect to 'average net profit' criteria u/s 135(5), It has been clarified that computation of net profit shall be as per section 198, which is primarily 'profit before tax'  

  iv. CSR as business expenditure: MCA clarified that the amount spent by company towards CSR cannot be claimed as 'business expenditure'  

  v. Carry forward of CSR expenditure: Any excess amount spent (i.e. more than 2% as specified in section 135) cannot be carried forward to the subsequent years and adjusted against that year's CSR expenditure   vi. Activities that are not covered under CSR: MCA specified some activities which would not qualify as CSR, which includes: (i) CSR Projects or programs or activities that are only for employees' benefit, (ii) one-off events such as marathons/awards/sponsorship of tv programmes etc, (iii) expenses incurred for compliance of any other Act / Regulation, (iv) Contribution of any amount directly or indirectly to any to political party, etc.   vii. Section 8 Companies: Since no exemption is given to section 8 companies therefore, any such Company which is fulfilling the prescribed criteria, is also required to comply with CSR provisions.   viii. Display of CSR policy on Co's website: Clarifies on mandatory display of CSR policy on company's website and reporting in Boards' Report.

CBEC prescribes procedure for e-payment of refund/rebate

CBEC noticed that most of the field formations follow manual handing over/dispatch of cheques for payment of refund/rebate. The procedure entails paper work, manual deployment by the claimants and delay in payment of refund. In order to speed up the transfer of refund/rebate claim directly to beneficiary's account, CBEC prescribes procedure for e-payment of refund/rebate claims through authorized banks.   Now Commissioners will provide refund/rebate to assessees through RTGS/NEFT facility after obtaining concurrence from authorized banks. The claimants have to provide one time authorization (duly certified by beneficiary bank in a prescribed format) while filing refund/rebate claim for the first time. In such authorization, all details related to assessee and its bank account required to be furnished.   The refund sanctioning authority will forward details of sanctioned orders and list of beneficiaries along with bank details to authorized bank at periodic intervals and the bank would credit refund amounts in respective accounts. A Unique Transaction Reference (UTR) will be generated for each transfer of fund and it will be bank's acknowledgment evidencing transfer of fund.

Notification on Quoting of PAN

CBDT Notification No. 95 dated 31^st December 2015

Amendment of Rules 114B, 114C, 114D of IT Rules

Amendment of Forms No. 60, 61 and 61A pursuant to CBDT press release dated December 15, 2015 wherein quoting PAN was made mandatory for transactions exceeding Rs. 2 lakhs. To come into force from January 1, 2016

Highlights:

• Amendment of Rule 114B (transactions in relation to which PAN is to be quoted). To come into force from January 1, 2016.
• Amendment of Rule 114C (verification of PAN). To come into force from January 1, 2016
• Amendment of Rule 114D (furnishing of statement containing particulars of Form No. 60). To come into force from January 1, 2016
• Amendment of Rule114E (furnishing statement of financial transaction) effective from April 1,2016
• Revised Form No. 60 (declaration to be filed in absence of PAN)
• Substitution of Form No. 61 (declaration to be filed by a person who has agricultural income and is not in receipt of any other income chargeable to tax)
• Amendment of Form No. 61A (statement of specified financial transactions)

Validation of Lower Deduction Certificate

Advisory for Deductors while deducting TDS at lower rate u/s 197 certificates

Deductors deduct tax at lower rate on payment/credit to deductee on production of certificate duly issued by assessing officers under section 197. Deductors quote such certificate number in quarterly TDS statement. Instances of huge default of 'Short Deduction' have been observed due to wrong quoting of 197 certificate number. The scenario of wrong 197 certificate generally arises when the deductor accepts from deductee a manually issued lower deduction certificate by assessing officer & quotes the same in TDS statements.

2. CPC(TDS) has provided the facility of validating the 197 certificate to the deductors on www.tdscpc.gov.in(TRACES).This enables a deductor to first validate the 197 certificates given to him by their deductees and then furnish the same in the TDSITCS statement.

3. If the 197 certificate is not valid as per TRACES validation, the deductor should always insist upon an ITO system generated certificate having a unique 10 digit alpha numeric number. This would minimize the generation of default of "Short Deduction due to 197 certificate".

4. This also applies to certificates issued under section 195(2) & 195(3) by LTU & international taxation officers.

5. Instruction to field authorities to issue only system generated certificate were issued vide instruction No. 36 through F.No. SWITDS/2/2/08-DIT(S)-II[Vol.ll] dated July , 2009 ( copy enclosed).

EPFO due date

The EPFO has issued EPF Circular No. WSU/9(1)2013/Settlement/35031 dt. 8 Jan., 2016, removing the grace period of 5 days for depositing PF and hence Feb., 2016 onwards the due date shall be 15th instead of 20th. This will have impact on Tax audit report

CIRC: RC electin results

1st preference count.

Ranking wise list of RC of CIRC (Quota 1587)

1. Pramod kumar boob 1252
2. Gautam sharma 1148
3. Mukesh bansal 968
4. Shashikant chandrakar 959
5. Rohit ruwatia 897
6. Nitesh gupta 891
7. Abhay chhajed 848
8. Deep kumar mishra 788
9. Sachin jain 758
10. Nilesh gupta 755
11. Churchill jain 717
12. Gyan chandra mishra 643
13. Devendra kumar somani 577
14. Ashok kumar pandey 572
15. Pramod nahar 552
16. Rohit maheshwari 497
17. Nitin gupta 487
18. Pradeep kumar goyal 483
19. Nirmal kumar soni 430
20. Ajay kumar mishra 425
21. Vijesh kumar khandelwal 401
22. Abhishek pandey 382
23. Manoj kumar agrawal 380
24. Mohit singhal 303
25. Hari ji kumar 285
26. Deepak kumar bajpai 204
27. Sharad jain 193
28. Lal raju bijeshwar 214
29. Atul kumar garg 183
30. Raghvendra 158
31. Samarth doneriya 103

CIRC Erection results: First preference for central council

1st preference count.

Ranking wise list of CC of CIRC.  (Quota-2916)

1. Shyam lal agrawal 1936
2. Prakash sharma 1422
3. Manu agrawal 1351
4. Kemisha soni 1328
5. Mukesh kushwah 1237
6. Umesh garg 971
7. Bankim shukla 953
8. Rajesh mangal 951
9. Jitender goyal 943
10. S. N. Maheshwari 924
11. Vikas jain 847
12. Amresh vashisht 845
13. Avichal kapoor 677
14. Vinay mittal 632
15. C. L. Yadav 628
16. Suman nayak 569
17. Nitish agrawal 446
18. Manoj sharma 446
19. Anubhav pradhan 186
20. Dhruv agrawal 97
21. Sanjeet kumar 61
22. Sanjay gupta 43

Annual information return

CBDT has issued Notification dated 30/12/2015, amending Rules 114B, 114C, 114D, 114E.

W.e.f. 01/04/2016, all assessees (Liable for Tax Audit u/s 44AB), will have to file Annual Information Return in Form 61A, in case of receipt of Cash payment exceeding Rs. 2 lacs for Sale of Goods/Services of any nature.

CBDT introduces mandatory e-filing of first appeal

CBDT introduces mandatory e-filing of first appeal i.e. before CIT(A) for persons who are required to file e-returns; E-filing also expected to facilitate fixation of hearing of appeals electronically; E-filing of CIT(A) appeals (alongwith the documents relied upon) expected to “remove human interface, reduce paperwork and decrease the transaction cost for the taxpayer”; CBDT anticipates that this step shall result in fewer deficient appeals as validations will be inbuilt which would ensure consistent and error free service; Current form for filing of CIT(A) appeal i.e. Form No. 35 to be replaced by a new form; CBDT press release states that “The new format for filing of appeals is more structured, objective, systematic, and aligned with the current provisions of the Income-tax Act”; CBDT recognizes this as another significant step in Income tax Department’s endeavour to digitise various functions of the Department for providing efficient taxpayer services and will reduce taxpayers’ compliance burden in appellate proceedings : CBDT

CBDT issued clarifications on several issues in order to facilitate the conduct of scrutiny

Update: CBDT has issued Instruction No. 20/2015 dated 29.12.2015 in which it has issued clarifications on several issues in order to facilitate the conduct of scrutiny assessments in cases selected through Computer Aided Scrutiny Selection (‘CASS’).

The CBDT has also stated that as far as the returns selected for scrutiny through CASS-2015 are concerned, two type of cases have been selected for scrutiny in the current Financial Year – one is ‘Limited Scrutiny’ and other is Complete Scrutiny’.

The assessees concerned have duly been intimated about their cases falling either in ‘Limited Scrutiny’ or ‘Complete Scrutiny’ through notices issued under section 143(2) of the Income-tax Act, 1961 (‘Act’). The procedure for handling ‘Limited Scrutiny’ cases has been explained in detail by the CBDT.

Key points:

1.States that the said Instruction is applicable only to cases selected for scrutiny under CASS and only on the parameter(s) of AIR/CIB/26AS data;

2.Indicates that scope of enquiry to be “Specific issue based” and directs AO to confine the questionnaire only to the specific issues pertaining to AIR/CIB/26AS data after giving reason for selection of the case for scrutiny to the assessee;

3.Also outlines the procedure for handling 'Limited Scrutiny' and 'Complete Scrutiny' cases in relation to cases selected through CASS-2015;

4.Highlights that during the course of assessment proceedings in ‘Limited Scrutiny' cases, if ‘potential escapement of income’ found exceeding Rs 5 lakhs (Rs 10 lakhs for metro charges) requiring substantial verification of other issues, the case may be taken up for ‘Complete Scrutiny’, subject to written approval of Pr. CIT/CIT ;

5.In all cases where AO proposes to make additions or disallowances, directs AO to (i) give fair opportunity of hearing to the assessee, (ii) issue show-cause notice duly indicating reasons for proposed additions/disallowances along with necessary evidences/reasons forming its basis and (iii) consider assessee’s submissions in response to the show-cause notice before passing the final order