An opportunity to file 6 year ITR where TDS remain unclaimed.

Presently , An  Assessee Can only file return for last 2 years and claim refund if any due and not beyond that. In case he missed to file return within prescribe timeline he has no choice other than to forget his refund claim. Income Tax Department in Latest circular No 9/ 2015  has guided on how an assessee who has failed to file return and claim Refund according to section 119(2) (B) can now make an application and get Refund due up to last 6 Assessment years.

STEP ONE : FILE AN APPLICATION

In case the amount is less than Rs 10 Lacs CsIT for any one assessment year.  The Application shall be made to the Pr.CsIT/CIT.  CIT will review the application & communicate with reason acceptance/rejection of such applications/claims.--In case the amount is more than Rs 10 Lacs the Application to be made to Chief Commissioner of Income Tax--In case the amount is more than Rs 50 Lacs then to CBDT.

STEP TWO ; MAY FILE UPTO 6 YEARS

Condonation Application can be file up to six previous years---Even Loss can be Claimed for Carry forward---The officer will be ensured that the income/loss declared and /or refund claimed is correct and genuine and also that the case is of genuine hardship on merits.

STEP THREE; CLEARENCE FROM AUTHORTIES

The power of accepting or rejecting the Condonation Application of Delay shall be subject to following Condition that The Income of Assessee is not assessable in the hands of other person under any provision of Income Tax Act. Further  No Interest will be admissible on belated claim of Refunds  and The Refund has arisen due to excess payment of Advance Tax or Self-Assessment Tax or due to excess deduction of TDS.
STEP FOUR ; SUPPLEMENTARY CLAIMS

A belated application for supplementary claim of refund (claim of additional amount of refund after completion of assessment for the same year) can be admitted for condonation provided other conditions as referred above are fulfilled.  Assessee will not receive interest on belated claim of refunds.

STEP FIVE: CUMULATIVE ITEREST BEYOND SIX YEARS

In the case of 8% Savings (Taxable) Bonds, 2003 issued by Government of India opting for scheme of cumulative interest on maturity but has accounted interest earned on mercantile basis and the intermediary bank at the time of maturity has deducted tax at source on the entire amount of interest paid without apportioning the accrued interest/TDS, over various financial years involved, the time limit of six years for making such refund claims will not be applicable .

100 things of TAX for common man.!!

Dear All

100 things of TAX for common man.!!

Income Tax:

1)      Detailed information of Income Tax is available on www.incometaxindia.gov.in
2)      As per Income Tax Act, Income is taxable under five heads- Salary, House Property, Business or Profession, Capital Gain and Other Sources.
3)      Salaried person must obtain Form 16 from his Employer Every Year.
4)      Income Tax Return should be filed by considering Form 16 and other Income.
5)      Transport Allowance is exempt up to Rs. 1,600 per month.
6)      30% Standard deduction is available on Income from House Property.
7)      Income to be considered as deemed let out on second House property.
8)      For self-occupied house property, deduction of Interest on Housing Loan is allowed up to Rs. 200,000/- and for other house property actual expenditure of Interest on Housing Loan is allowed.
9)      Repayment of Principal amount of Housing Loan is deductible u/s 80C up to Rs. 150,000/-.
10)  Tax Audit is compulsory if sales turnover exceeds Rs. 1 crore in case of business.
11)  Tax Audit is compulsory if the Gross Receipts of Professionals exceeds Rs.25 lakhs.
12)  If sales turnover is below Rs. 1 crore, then net profit of 8% or higher is to be taken as business income otherwise tax audit is required.
13)  The Due Date for Tax Audit and income Tax Return is 30th September.
14)  Assessee other than Company and those eligible for Tax Audit are required to file Income Tax Return before 31st of July. Extended date is 31st Aug for F.Y. 14-15.
15)  Accurate Stock Valuation should be done on 31st of March.
16)  Cash payment should not be made to a person in single day exceeding Rs.20, 000.
17)  Cash Payment limit for Transporters is Rs. 35,000/-.
18)  Loans, deposits and Immovable Properties transactions should not be carried out above Rs. 20,000 in cash.
19)  Business loss can be carried forward to Next 8 Years.
20)  Tax Audit applicable assesses should deduct TDS on particular transactions.
21)  TDS should be made on the date of Credit or Payment basis of whichever is earlier.
22)  TDS payment should be made on or before 7th day of Next Month.
23)  TDS Returns are to be filed Quarterly.
24)  TDS returns can be revised any number of times.
25)  TDS should be deducted and paid if applicable.
26)  If TDS is not deducted then deduction of 30% of Expenditure is not allowed.
27)  Late filling of TDS return attracts late filing fees of Rs. 200 per day.
28)  Long Term Capital Gain will arise if transfer of specified Capital Assets is made after 3 years.
29)  Generally Long Term Capital Gains is taxable @ 20%
30)  STT paid Long Term Capital Gain on Shares,etc is exempt from Tax.
31)  Short Term Capital Gain is Taxable @ 15% if STT is paid.
32)  Capital Gain on Immovable Properties is chargeable at Stamp Duty Value or Selling Price whichever is higher.
33)  Dividend received from domestic company is exempt from Tax.
34)  Agricultural Income is exempt from Tax.
35)  Gifts received form stranger of an Amount exceeding Rs. 50,000 is taxable.
36)  Income Tax is not chargeable on Gifts received at the time of Marriage, Will, and in case of Succession and from specified relatives.
37)  Maximum deduction limit u/s 80C, 80CCC and 80 CCD is Rs.1, 50,000.
38)  Deduction of Medical Insurance Premium is available up to Rs. 25,000.
39)   Deduction of Medical Insurance Premium paid for Parents is available up to Rs. 20,000.
40)  Deduction limit of Interest earned on Saving Account is up to Rs.10, 000.
41)  Income earned by a Minor child is clubbed in the hands of Parents.
42)  Every Taxpayer should verify his Form 26AS.
43)  Form 26AS provides the Information regarding the TDS, Advance Tax paid and details of refund.
44)   Notice may be sent to the Taxpayer if the Income mentioned in Form 26AS and the Income Tax Return filed is having difference.
45)  Basic Exemption Limit for individuals for F. Y. 2015-16 is Rs. 2,50, 000.
46)  Basic Exemption Limit for Senior Citizen i.e. above 60 years age is Rs. 3,00, 000.
47)  Basic Exemption Limit for Super Senior Citizen i.e. above 80 years age is Rs. 5,00,000.
48)  Advance Tax is to be paid if Tax Liability during the year exceeds Rs. 10,000.
49)  12% of Surcharge is applicable if Income Exceeds Rs. 1Crore.
50)  Income Tax Return should be filed if Income exceeds Basic Exemption Limit.
51)  30% of Tax applicable on Income of Partnership Firm, Company, LLP etc.
52)  For Companies – Minimum Alternate Tax and for other Assesses – Alternate Minimum Tax rate is 18.5%.
53)  Details of all Bank Accounts have to be given in Income Tax return.
54)  Passport number is required to be given in Income Tax return.
55)  Detail of Fixed Assets held in Foreign Country is required to be given in Income Tax return.
56)  If taxable income of Individual is less than Rs. 5 Lakhs then relief of Rs. 2,000/- is available in Tax.
57)  Aadhar Card No. is required to be mentioned in Income Tax return.
58)  E-filling of return is compulsory if income exceeds Rs. 5 lakhs.
59)  In Income Tax, E-filling of return can be done for Previous 2 Years only.
60)  PAN Card is essential for Taxpayer and it should not be used as Id Proof.
61)  From FY 2014-15 Depreciation is to be calculated as per New Companies Act.
62)  Domestic Transfer Pricing is applicable on transaction exceeding an Amount Rs. 20 Crores.

Now some points about MVAT:

63)  VAT registration is compulsory if Gross Turnover exceeds Rs. 10 lakhs.
64)  VAT rate is 1%, 5%, 12.5%, and 20% and CST rate is 2% on respective commodities.
65)  Return Periodicity should be verified every year from the Departments site www.mahavat.gov.in
66)  Periodicities of Returns are Monthly, Quarterly and Half yearly.
67)  Vat payment and return should be filed within 21st of next Quarter, Month or Half Year.
68)  Late payment of VAT will attract Interest @ 1.25% p.m.
69)  A late fee of Rs. 1000 is to be paid if late return is filed.
70)   Late fee of Rs. 5000 is charged if Return filed after 30 days.
71)  Full set off can be taken on Plant and Machinery and Electrical Fitting.
72)  3% of retention is to be taken on Office Equipment’s and Computer.
73)  Setoff of Software, Building and passenger car is not available.
74)   AnnexureJ1 mentioning TIN of sellers has to be filed with Vat return.
75)  AnnexureJ2 mentioning TIN of buyers has to be filed with Vat return.
76)  Vat Setoff cannot be carried forward to next year if it exceeds Rs. 5 lakhs.
77)  VAT Audit is compulsory if Gross Turnover exceeds Rs. 1 Crore.
78)  Due date for filling VAT Audit report is 15th January.
79)  Dealer can verify the details of return filed and Registration from the “Dealer information System.”
80)  Mis-match report of Annexure J1 and J2 should be verified and should be reconciled.
81)  Composition Scheme is available for Retailers having Gross turnover less than Rs. 50 Lakhs.
82)  WCT is to be deducted if Works Contract exceeds Rs. 5 lakhs.
83)  5% of WCT is to be deducted for non-registered dealers instead of 2%.
84)  TDS deductor has to file return before 30th June after end of financial year.

Profession Tax:

85)  Profession Tax is required to be paid for Employer and Employee.
86)  Every Businessmen and Professional assesse has to pay his Professional Tax before 30th June.
87)  Employer has to pay Profession Tax of employees by deducting from the salary.
88)  If Professional Tax Liability exceeds Rs. 50,000 then monthly Return have to be filed otherwise annually.
89)  A late fee of Rs. 1000 is to be paid if Profession Tax return in not filed before due date.
90)  Profession Tax is not Applicable to Men if salary does not exceed Rs. 7, 500.
91)  Profession Tax is not Applicable to Women if salary does not exceed Rs. 10,000.

Service Tax:

92)  Service Tax is applicable if Taxable Service Provided exceeds Rs. 10 lakhs.
93)  14% of service Tax is applicable w.e.f 1st June, 2015.
94)  Company Assesse has to pay Service Tax monthly.
95)  Individual, Partnership Firm, LLP assesse has to pay Service Tax Quarterly.
96)  Service Tax is payable on the 6th after end of Month or Quarter
97)  Interest is payable @ 18%pa if Service Tax is not paid before the due date.
98)  Interest @ 30% is to be paid if service Tax is not paid for a Year.
99)  Service Tax return should be filed Half Yearly before 25th October and 25th April.
100)          If service Tax is not paid of Rs. 50 lakhs then there is imprisonment

MCA Notifications

MCA has released notification dated 29th May,2015 notifying the said date as the effective date of provisions of Section 1 to 12 and  15 to 23 of the Companies (Amendment) Act, 2015. All sections of the amendment act have been made effective w.e.f. 29th May, 2015 except the sections relating to Section 143 (related to 'fraud') and 177 (related to omnibus approval by audit committee) of Companies Act, 2013.
 
Five Related amendment Rules have also been released today in Companies (Registration Offices and Fees) Rules, Companies (Registration of Charges) Rules, Companies (Declaration and Payment of Dividend) Rules, Companies (Incorporation) Rules and Companies (Share Capital and Debentures) Rules.
 
Highlights of each of the Amendment Rules are as under:
 
1. Companies (Incorporation) Second Amendment Rules, 2015 – The Incorporation Rules have also been amended by inserting a new proviso in rules 12 pursuant to which if pursuing of any objects require any Sectoral regulator's approval such as RBI, SEBI etc. then the registration or approval shall be required before pursuing the said objects and a declaration shall be required to be submitted in that behalf. This resolves a long pending confusion as to whether the RoC would require sectoral regulator's approval before approving the application for incorporation of a company. The format of license and MoA of a section 8 company is also amended in the new amendment.
2. Companies (Declaration and Payment of Dividend) Second Amendment Rules, 2015 – Sub Rule 5 of Rule 3 mandatorily requiring the setting off previous losses & depreciation not provided in previous year or years against the profits of the current year before declaration of dividend has been done away and the said sub rule has been omitted by the said amendment Rules.  
3. Companies (Registration of Charges) Amendment Rules, 2015 – In sub rule 4 of Rule 3 relating to verification of instrument / deed consisting of property situated outside India the mandatory requirement of affixation of seal of the company has been done away and now the same has been made optional.
4. Companies (Registration Offices and Fees) Second Amendment Rules, 2015 – The Board Resolutions passed pursuant to section 179(3) and requiring filing with MCA pursuant to section 117(3)(g) would now neither be available for public inspection nor certified copies would be issued by RoC of such BRs filed by cos.
5. Companies (Share Capital and Debentures) Second Amendment Rules, 2015 – In Sub rule 3 of Rule 5 relating to Certification of Share Certificate the mandatory requirement of affixation of seal of the company has been done away and now the same has been made optional. Further issue of Share Certificate would require signatures of atleast 2 directors authorised by Board OR by any one director as authorised by the Board and mandatorily by the Company Secretary of the Company.

ITR Simplified

Ministry of Finance

 

31-May, 2015 13:53 IST

 

Income Tax Return Forms ITR 1, 2 and 4S Simplified for Convenience of the Tax Payers;

A New Form ITR 2A Proposed which can be Filed by an Individual or HUF who does not have Capital Gains, Income from Business/Profession or Foreign Asset/Foreign Income; In Form ITR 2 and the New Form ITR 2A, the Main Form will not Contain more than 3 Pages, and other Information will be Captured in the Schedules which will be Required to be filled only if applicable;

As the Software for these Forms is under Preparation, they are likely to be available for e-filing by 3^rd week of june 2015;Time Limit for Filing these Returns is also Proposed to be Extended up to 31.08.2015;

Only  Passport Number, if available, would be required to be given in forms Itr-2 and itr-2A. Details of Foreign Trips or Expenditure thereon are not required to be Furnished

Forms ITR 1, 2 and 4S for Assessment Year 2015-16 were notified on 15^th April 2015 (15.04.2015). In view of various representations, it was announced that these ITR forms will be reviewed. Having considered the responses received from various stakeholders, these forms are proposed to be simplified in the following manner for the convenience of the taxpayers:-

1)                                 Individuals having exempt income without any ceiling (other than agricultural income exceeding Rs. 5,000) can now file Form ITR 1 (Sahaj). Similar simplification is also proposed for individuals/HUF in respect of Form ITR 4S (Sugam).

2)                                 At present individuals/HUFs having income from more than one house property and capital gains are required to file Form ITR-2. It is, however, noticed that majority of individuals/HUFs who file Form ITR-2 do not have capital gains. With a view to provide for a simplified form for these individuals/HUFs, a new Form ITR 2A is proposed which can be filed by an individual or HUF who does not have capital gains, income from business/profession or foreign asset/foreign income.

3)                                 In lieu of foreign travel details, it is now proposed that only Passport Number, if available, would be required to be given in Forms ITR-2 and ITR-2A. Details of foreign trips or expenditure thereon are not required to be furnished.

4)                                 As regards bank account details in all these forms, only the IFS code, account number of all the current/savings account which are held at any time during the previous year will be required to be filled-up. The balance in accounts will not be required to be furnished. Details of dormant accounts which are not operational during the last three years are not required to be furnished.

5)                                 An individual who is not an Indian citizen and is in India on a business, employment or student visa (expatriate), would not mandatorily be required to report the foreign assets acquired by him during the previous years in which he was non-resident if no income is derived from such assets during the relevant previous year.

6)                                 As a measure of simplification, it has been endeavoured to ensure that in Form ITR 2 and the new Form ITR 2A, the main form will not contain more than 3 pages, and other information will be captured in the Schedules which will be required to be filled only if applicable.

As the software for these forms is under preparation, they are likely to be available for e-filing by 3^rd week of June 2015. Accordingly, the time limit for filing these returns is also proposed to be extended up to 31^st August, 2015 (31.08.2015). A separate notification will be issued in this regard.

**********

New income tax return forms.

Revenue department notifies new income tax return forms. The tax department extends last date for filing of I-T returns to August 31 (PTI)
The Finance Ministry has notified revised Income Tax Return (ITR) forms. These forms will be used to file return for the assessment year 2015-16 (for income earned during fiscal year 2014-15). It has also been proposed to extend the last date for filing returns to August 31 as against normal practice of July 31.Under the new forms, in lieu of foreign travel details, it is now proposed that only Passport Number, if available, would be required to be given in Forms ITR-2 and ITR-2A. Details of foreign trips or expenditure thereon are not required to be furnished. Similarly, as regard to bank account details in all these forms, only the IFS code, account number of all the current/savings account, which are held at any time during the previous year will be required to be filled-up. The balance in accounts will not be required to be furnished. Details of dormant accounts which are not operational during the last three years are not required to be furnished.The Finance Ministry mentioned that an individual, who is not an Indian citizen and is in India on a business, employment or student visa (expatriate), would not mandatorily be required to report the foreign assets acquired by him during the previous years in which he was non-resident if no income is derived from such assets during the relevant previous year.In Form ITR 2 and the new Form ITR 2A, the main form will not contain more than 3 pages, and other information will be captured in the schedules which will be required to be filled only if applicable. This has been done to ensure simplification.Individuals having exempt income without any ceiling (other than agricultural income exceeding Rs 5,000) can now file Form ITR 1 (Sahaj). At present individuals/HUFs (Hindu Undivided Families) having income from more than one house property and capital gains are required to file Form ITR-2. It is, however, noticed that majority of individuals/HUFs who file Form ITR-2 do not have capital gains. With a view to providing for a simplified form for these individuals/HUFs, a new Form ITR 2A is proposed which can be filed by an individual or HUF who does not have capital gains, income from business/profession or foreign asset/foreign income.It may be noted that on April 15, the Finance Ministry notified ITR Forms 1, 2 and 4S for Assessment Year 2015-16. However, these forms soon got entangled into controversy due to more and more informations were asked to be submitted. Finance Minister Arun Jaitley ordered revision of forms and accordingly new and simplified forms notified.

FEMA Rule-Current Account Transactions-Amendment

RBI fixes USD 2,50,000 for remittances by individual for aggregate of certain current account transactions

The Reserve Bank of India ('RBI') has notified amendment to the Foreign Exchange Management (Current Account Transactions) Rules to specify an aggregate limit of USD 2,50,000 for remittance in foreign currency for certain current account transactions, inter-alia, for private visits to any country (except Nepal and Bhutan), gifts or donations, going abroad for employment, emigration, business travels, or medical treatment abroad, etc.

Remittances in foreign currency by an individual for the following current account transactions shall be made within limit of USD 2,50,000:

a) Holiday/Private Visits abroad

b) Business trip

c) Gifts/Donation

d) Employment or education

e) Remittance for Maintenance of a close relative abroad

f) Medical treatment abroad

g) Emigration facilities

Further, it is provided that an individual can avail of foreign exchange facility of an amount exceeding the limits as prescribed above under the Liberalized Remittance Scheme ('LRS') for the purpose of emigration, education, business travel, medical treatment, etc.

However, the amount so remitted by individual under the LRS shall be reduced from the USD 250,000 by the amount so remitted.

NRI-FDI

Government amends FDI rules to allow NRIs to invest in India

 

The Union Cabinet on Thursday approved amendments to the Foreign Direct Investment (FDI) policy on investments by Non-Resident Indians (NRIs), Persons of Indian Origin (PIOs) and Overseas Citizen of India (OCIs) for greater forex remittances.

A decision in this regard was taken by the Cabinet Committee on Economic Affairs, headed by Prime Minister Narendra Modi.

The Cabinet "approved amendments to FDI policy on investments by NRIs, PIOs & OCIs. This will give PIOs & OCIs parity with NRIs in eco & edu (economy and education)," an official spokesperson said.

"The amendment in FDI for OCIs, NRIs & PIOs will lead to greater forex remittances & investment," he added.

As per the DIPP's proposal any investment made by NRIs. OCIs and PIOs from their rupee account in India, will not be treated as foreign investment.

An official said that the non-repatriable NRI funds would be treated as domestic investments.

The government wants to channelise the funds of NRIs, who now have set up large businesses abroad, by treating non-repatriable investments by NRIs as domestic investment.

The proposal was floated by the Department of Industrial Policy and Promotion to tap the NRIs for investments in defence, railways among other sectors. Last year, the government had formed a committee on this matter

 
Since coming to power in May last year, the Narendra Modi government has liberalised the FDI limit in crucial sectors like defence, insurance, real estate, railways and medical devices. The measures were aimed at improving India's ranking in the World Bank's Ease of Doing Business index, where India stands at 142 among 189 countries.

The measures could also be seen in the context of the Modi government allowing NRIs to vote through e-ballot system or proxy.

Concurrent audit online application link of United Bank of India

Concurrent audit online application link of United Bank of India

http://ubionline.unitedbank.co.in/ca/application.php

Concurrent audit online application link of Punjab & Sindh bank

Concurrent audit online application link of Punjab & Sindh bank

https://www.psbindia.com/OnLine_Application_CCA.php

New CA Course applicable from 2016 ( drafted by ICAI )

FYI - ICAI Notifications
New CA Course applicable from 2016 ( drafted by ICAI ) :
1. Change in CA Foundation :-
- Name changed from CPT to CA Foundation
- Duration increased to 9 months
- Number of Papers 4
Paper 1 - Fundamentals of Accounting (100
Marks)
Paper 2- Quantitative Aptitude (100 Marks)
Paper 3A - Mercantile Law (60 Marks)
Paper 3B - General Economics (40 Marks)
Paper 4A - General English (50 Marks)
Paper 4B - Business Communication (50 Marks)
- Partly descriptive & partly MCQ paper.
2. Change in CA Intermediate :-
- Cost Accounting & FM to be 2 different subject.
- Duration increased from 9 months to 12 months.
- ITSM removed
- Number of Papers 8
Paper 1 - Accounting ( 100 Marks)
Paper 2 - Company Law, Other law and Ethics
Part I : Company Law (60 Marks)
Part II: Other Law (20 Marks)
Part III: Ethics (20 Marks)
Paper 3 - Cost Accounting (100 Marks)
Paper 4 - Direct Taxes (100 Marks)
Paper 5 - Advanced Accounting (100 Marks)
Paper 6 - Auditing & Assurance (100 Marks)
Paper 7 - Financial Management (100 Marks)
Paper 8 - Indirect Taxes (100 Marks)
3. Change in CA Final :-
- New subject added Capital Markets & Financial Services.
- ISCA removed.
- Eligibility to appear to CA Final only after
completion of articleship.
- Number of Papers 8
Paper 1 - Financial Reporting (100 Marks)
Paper 2 - SFM (100 Marks)
Paper 3 - Advance Auditing & Professional Ethics (100 Marks)
Paper 4 - Corporate & other economic law (100 Marks)
Paper 5 - Advance Management Accounting (100 Marks)
Paper 6 - Financial Services & Capital Market (100 Marks)
Paper 7 - Advance tax management (60 Marks) & International Taxation (40 Marks)
Paper 8 - Indirect Taxation (100 Marks)
Note : New course is expected to be introduced somewhere in 2016, ICAI has also previously announced that both the existing as well as new course will continue for the next few years after which ICAI will gradually shift to the new course.
The existing students need not to worry as they would be given ample time to clear their exams.

Forwarded as received

CA. Ashwin Nagar

Draft Circular on Range Concept

Draft norms for range concept in transfer pricing

The tax department on Friday came out with draft norms for introduction of a range concept for calculating an Arms Length Price for valuing transactions between related entities for the purpose of taxation. The Central Board of Direct Taxes has proposed to use multiple year data for determining the price. At present, only one year's data is used for calculating the price.

CBDT Circular No.8

Important CBDT Circular Sets Out Procedure For Speedy Resolution Of Taxpayer's Grievances Regarding Outstanding Tax Demands

The CBDT has issued Circular No. 8 of 2015 dated 14.05.2015 setting out the detailed procedure that has to be followed by taxpayers in response to an arrear demand from the AO. The Ministry of Finance has also issued a press release stating that the said Circular is because the Income Tax Department has taken note of grievances of taxpayers arising on account of outstanding tax demand which may be inaccurate due to non-reporting or delayed reporting of TDS by deductors leading to mismatch between the claim and data available with the Department, non-posting of challans, non-disposal of rectification applications, incorrect details of income or pre-paid taxes reported by taxpayer etc. It is emphasized that the Income Tax Department is committed to early and satisfactory resolution of taxpayers' grievances. It is also stated that about 95% of entries of Demand involve demand up to Rs. 1 lakh and about 90% of such assessees are Individuals and HUFs. It is expected that majority of the grievances of small taxpayers can be redressed by following the procedure prescribed in the circular.ivinayaka Residency,

Income Exempted-No TDS

Unconditional exemption of income under Section 10 and no statutory liability to file return of income under Section 139- NO TDS- SEE CIRCULAR NO.7

Draft Gold Monetization Scheme

Draft Gold Monetization Scheme 

 

The Finance Minister in his budget speech for the Union Budget 2015-16 made the following announcement: "India is one of the largest consumers of gold in the world and imports as much as 800-1000 tonnes of gold each year. Though stocks of gold in India are estimated to be over 20,000 tonnes, most of this gold is neither traded, nor monetized. Keeping this in view, the government in Budget 2015-16 has announced the Gold Monetization Scheme which will replace both the present Gold Deposit and Gold metal Loan Schemes. The new scheme will allow the depositors of gold to earn interest in their metal accounts and the jewellers to obtain loans in their metal account. Banks/other dealers would also be able to monetize this gold".

 

Accordingly, a draft outline of the Scheme has been prepared. Comments and views are invited on the Draft Gold Monetization Scheme.

Draft Gold Monetization Scheme (The outline of the Gold Monetization Scheme placed below is only at the draft stage and is being placed here to obtain public opinion. The scheme as it stands at this stage, does not imply any commitment from the government)

The last date to share your views is 2nd June, 2015 by 5:00 p.m.

More than 4 concurrent audits of banks

Brief decision of Council of ICAI at 342nd Meeting held on 15.05.2015. A CA is not allowed to do more than 4 concurrent audits of banks

Guidance note issued by ICAI on CSR activities expenditure

FYI - ICAI today issued Guidance Note on Accounting for Expenditure on Corporate Social Responsibility Activities. 

The objective of this Guidance Note is to provide guidance on recognition, measurement, presentation and disclosure of expenditure on activities relating to corporate social responsibility.

The Guidance Note does not deal with identification of activities that constitute CSR activities but only provides guidance on accounting for expenditure on CSR activities in

line with the requirements of the generally accepted accounting principles including the applicable Accounting Standards.

Link for the guidance note: http://220.227.161.86/37627gn-csr150515.pdf

Supreme Court Upholds NCLT

Supreme Court upholds the constitutional validity of National Company Law Tribunal

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL ORIGINAL JURISDICTION

WRIT PETITION (C) NO. 1072 OF 2013

MADRAS BAR ASSOCIATION

VERSUS

UNION OF INDIA & ANR. 

J U D G M E N T

A.K. SIKRI, J.

This writ petition filed by the petitioner, namely, the Madras Bar Association, is sequel to the earlier proceedings which culminated in the judgment rendered by the Constitution Bench of this Court in Union of India v. R. Gandhi, President, Madras Bar Association¹ (hereinafter referred to as the '2010 judgment'). In the earlier round of litigation, the petitioner had challenged the constitutional validity of creation of National Company Law Tribunal ('NCLT' for short) and National Company Law Appellate Tribunal ('NCLAT' for short), along with certain other provisions pertaining thereto which were incorporated by the Legislature in Parts 1 B and 1 C of the Companies Act, 1956 (hereinafter referred to as the 'Act, 1956′) by Companies (Second Amendment) Act,2002.

2) Writ petition, in this behalf, was filed by the petitioner in the High Court of Madras which culminated into the judgment dated 30.03.2004. The High Court held that creation of NCLT and vesting the powers hitherto exercised by the High Court and the Company Law Board ('CLB' for short) in the said Tribunal was not unconstitutional. However, at the same time, the High Court pointed out certain defects in various provisions of Part 1B and Part 1C of the Act, 1956 and, in particular, in Sections 10FD(3)(f)(g)(h), 10FE, 10FF, 10FL(2), 10FR(3), 10FT. Declaring that those provisions as existed offended the basic Constitutional scheme of separation of powers, it was held that unless these provisions are appropriately amended by removing the defects which were also specifically spelled out, it would be unconstitutional to constitute NCLT and NCLAT to exercise the jurisdiction which is being exercised by the High Court or the CLB. The petitioner felt aggrieved by that part of the judgment vide which establishments of NCLT and NCLAT was held to be Constitutional. On the other hand, Union of India felt dissatisfied with the other part of the judgment whereby aforesaid provisions contained in Parts 1 B and 1 C of the Act, 1956 were perceived as suffering from various legal and Constitutional infirmities. Thus, both Union of India as well as the petitioner filed appeals against that judgment of the Madras High Court. Those appeals were decided by the Constitution Bench, as mentioned above. 

Black Money Bill: All You Need to Know

Black Money Bill: All You Need to Know

The black money Bill was passed by the Lok Sabha on Monday. Christened the Undisclosed Foreign Income and Assets (Imposition of New Tax) Bill, 2015, it seeks to check the black money menace with stringent provisions for those stashing illegal wealth abroad. The Bill provides for separate taxation of any undisclosed income in relation to foreign income and assets. Such income will henceforth not be taxed under the Income-tax Act but under the stringent provisions of the new legislation.
Here's your 10-point cheat-sheet to the story:

1. According to the Undisclosed Foreign Income and Assets (Imposition of New Tax) Bill, 2015, those who conceal income and assets and indulge in tax evasion in relation to foreign assets can face rigorous imprisonment of up to 10 years.

2. The offence will be non-compoundable and the offenders will not be permitted to approach the Settlement Commission for resolution of disputes.

3. There will also be a penalty of 300 per cent of taxes on the concealed income and assets.

4. According to the Bill, undisclosed foreign income or assets shall be taxed at the flat rate of 30 per cent. No exemption or deduction or set off of any carried forward losses which may be admissible under the existing Income-tax Act, 1961, shall be allowed. And concealment of income in relation to a foreign asset will attract penalty equal to three times the amount of tax (90 per cent of the undisclosed income or the value of the undisclosed asset). This would be over and above tax at a flat rate of 30 per cent.

5. The Bill also proposes to make concealment of income and evasion of tax in relation to a foreign asset a 'predicate offence' under the Prevention of Money Laundering Act, which will enable the enforcement agencies to attach and confiscate the accounted assets held abroad and launch proceedings.

6. It seeks to make non-filing of income tax returns or filing of returns with inadequate disclosure of foreign assets liable for prosecution with punishment of rigorous imprisonment of up to 7 years. To protect persons holding foreign accounts with minor balances which may not have been reported out of oversight or ignorance, it has been provided that failure to report bank accounts with a maximum balance of upto Rs.5 lakh at any time during the year will not entail penalty or prosecution.

7. The tax liability on an overseas property would be computed on the basis of its current market price, not the price at which it was acquired.

8. The Bill provides for a short window for those holding overseas assets to declare their wealth, pay taxes and penalties to escape punitive action. Failure to furnish return in respect of foreign income or assets shall attract a penalty of Rs.10 lakh. The same amount of penalty is prescribed for cases where although the assessee has filed a return of income, but he has not disclosed the foreign income and asset or has furnished inaccurate particulars of the same.

9. The Income Tax assesses with overseas assets will get a one-time opportunity for declaring them. The time-frame of the short window will be notified after the passage of the bill.

10. The proposal to come out with a new law on black money was announced by Finance Minister Arun Jaitley in his first full-year Budget in February

Finance Bill 2015 gets presidential assent

Finance Bill 2015 gets presidential assent today and becomes Finance Act 2015. Service tax rate of 14% get approved, however will be effective from date to be notified, till that time old rate will be applicable.

Companies amendment bill passed in Rajya Sabha

Companies amendment bill passed in Rajya Sabha

Main features and relaxations are as under:

1.      No minimum capital requirement of Rs.1 lakh (in case of private company) or Rs. 5 lakh (in case of public company)

2.      Approval of shareholders under Section 188 (related party transactions) can be ordinary

3.      Transaction between holding and wholly owned subsidiaries whose accounts are consolidated and laid before general meeting are exempt from shareholders’ approval requirement is exempt from requirement of obtaining shareholders’ approval

4.      No requirement of common seal. If the company does not have common seal, authority in favour of any person by two directors or one director and company secretary, if any, will bind the Company

5.      If deposit is accepted in violation of deposit rules or the company fails to repay deposit or interest thereon the company shall, in addition to the payment of the amount of deposit or part thereof and the interest due, be punishable with fine which shall not be less than one crore rupees but which may extend to ten crore rupees; and every officer of the company who is in default shall be punishable with imprisonment which may extend to seven years or with fine which shall not be less than twenty-five lakh rupees but which may extend to two crore rupees, or with both. If it is proved that the officer of the company who is in default, has contravened such provisions knowingly or wilfully with the intention to deceive the company or its shareholders or depositors or creditors or tax authorities, he shall be liable for action under section 447.

6.      Exemption for loan given to wholly owned subsidiary and security or guarantee provide on behalf of subsidiary is given 185 itself (earlier exemption was through rules, subordinated regulations)

7.      Board resolutions under Section 179 which are filed with RoC, will not be public document

8.      Previous losses and depreciation will need to set off out of current year profit before declaring dividend

9.      If dividend is claimed and paid, shares in respect thereof should not be transferred to IEPF

10.  Fraud exceeding certain percentage need to be reported to Central Government. Other fraud of lesser amount need to be reported to audit committee/ board and details of frauds which are reported to audit committee/ board also need to be disclosed in directors report

11.  Audit Committee can give omnibus approval (this will be on the lines of listing agreement; but threshold and other conditions will be prescribed by Rules)