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

Pre Budget Memorandum-Indirect Taxes-2016

ICAI Pre-Budget Memoranda 2016 for Indirect Taxes–Key Points Raised on Service Tax, Cenvat, Central Excise, Customs & CST

 

The  Key Points Raised are  as under:-

 

 

Service Tax

 

1.  Introduction of Tax Audit Report under Service Tax

 

2.  Introduction Reconciliation Certification under Service Tax

 

3.  Exempting Employer to Employee Services

 

4.  Works Contract Definition to be Brought in Parity with CST Act

 

5.  Trading of Goods to be removed from Negative List as it is not even a Service

 

6.  Seeking Clarification for Non Taxability of charges/ recoveries for supply of electricity by developers

7.  No Serice tax on Take Away or Home Deliveries to be incorporated in the Act Itself

 

8.  Seeking Clarification on Non Taxability of Penalties, Liquidated Damages etc

 

9.  Valuation Clarification on Sharing of Expenses between Sister Concerns / Groups Companies

 

10.  Deemed Valuation for Transactions whose Consideration is non monetary

 

11.  Small Scale Exemption to be Raised from 10 Lacs to 25 Lacs

13.  Date of Service Tax Liability to be mentioned in Registration Certificate Itself

 

14.   Efiling all the documents to the Department – CA's to Certify the Form

 

15.   GAR-7 Challan to mention the Period Pertaining to which Tax Paid

 

16.   Due Date of Payments to be Made 10th of Following Month in line with GST

 

17.   Provision for Bad Debts to be covered under Rule 6(3) of Service Tax Rules, 1994

 

18.   Challan Correction System to be Implemented

 

19.   Introduction of Annual Return under Service Tax

 

20.  Instant Acknoledgment in Filing of Service Tax ST-3\

 

21.  Time Limit to Revise to be Increased to 180 Days

 

22.  To Curb Vexatious Searches, the reasons for conducting the search may be recorded in writing. This will also be in line with income-tax provisions

23.  Recorded Statement to be provided to the assessee immediately. Use of Printed Statement to be permissible

 

24.   Prosecution only in exceptional cases and must include mens rea

 

25.   Power to Arrest must not be delegated below the officer of Rank of JC / AC

 

26.   Online Filing of CESTAT Appeals

 

27.  Online Filing of A-1 & A-3

 

28.   Conflict between Section 67A and Rule 4 / 5 of POT to be removed

 

 

Cenvat Credit

 

 

1.  Avoid the exclusion clause of Cenvat on Input Services

 

2.  Allow Credit of Outward Freight

 

3.  Input Ambit should cover Capital Structures

 

4.  Discreet Drafting of Rule 2(e) – Definition of "Exempted Services"

 

5.  Rule 2( d) i.e. Definition of Exempted Goods to be brought in accordance with Bharat Fritz Werner Limited Judgement of Karnataka High Court on Job Work

6.  Utilisation of Old Education and Secondary Education Cess

 

7.  Swachh Bharat Cess to be Integrated in Cenvat Scheme

 

8.  100% Cenvat Credit on Capital Goods in the First Year Itself

 

9.  Refund to be Allowed to be certified by a Practicing Chartered Accountant and not neccesarily the Auditor only

 

10.  Refund Process Streamling

11.          Reinstatement of Transfer of Credit from LTU one unit to another

12.  No Interest shall be Payable under Rule 14 of CCR, 2004 where assessee is able to substantiate non utilisation of Impugned Credit

13.  Rule 15 Penalty – 'Taken or Utilised' to be replaced with 'Taken and Utilised'.

 

 

Central Excise

 

1.  Procedure for Section 14 to be envisaged in Rules

 

2.  Advance Ruling on Admissibility of Cenvat Credit on Capital Goods in Factory or Service Provider

 

3.  Memorandum of Cross Objection before Commissioner (Appeals) – Forms to be Prescribed

 

4.  Mandatory Pre-deposit to be 1% / 2% instead of Current 7.5% / 10 %. Bank Guarantee to substitute. Tribunal Must be given right to waive predeposit on merit

5.   Excise Returns should be Quarterly and not Monthly

 

6.  Revision of Excise Returns should be Permissible

 

7.  Audit Report under EA-2000 must be furnished in all  cases.

 

 

Customs

 

1.  Dispensing 1% EDD

 

2.  SAD Refund to be Smoothened based on CA Certification

 

3.  SAD Refund not to be subject to Time Limit under Section 27

 

4.  Increase in Limit of Duty Free Allowance to Rs 75,000/-

 

 

Central Sales Tax

 

1.  Reduction of CST Rate to 1%

 

2.  Streamlining Form Process related to C, F, H, E1 and EII