New declaration added- FORM INC-32 (SPICe+)
“I, on behalf of the proposed directors, hereby declare that person seeking appointment is a national of a country which shares a land border with India, necessary security clearance from Ministry of Home Affairs, Government of India shall be attached with the consent. Yes/ No. (if yes is opted, a copy of the security clearance is to be attached)”
MCA notification dated 20th May, 2022
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Unexplained investments in India by an assessee who is tax resident of UAE cannot be taxed u/s 69 of the Act as these fall under Article 22 of Indo-UAE DTAA ('other income') which makes such income taxable in country of residence (UAE in this case) unless these investments are proved to be made out of income generated in India. [Mumbai v. Rajeev Suresh Ghai 2021, (Mumbai-Trib.)]
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UDIN Directorate of The Institute of Chartered Accountants of India reports that the last date for updating Unique Document Identification Number (UDIN) for all the IT forms at the e-filing portal has been extended to Jan 31, 2022 by CBDT.
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Gujarat HC held that the department cannot deny claim of credit of taxes withheld to the employee if the employer don’t deposit such TDS to the credit of central government, relied upon past judicial pronouncements of Bombay and Gauhati HC. Held that the credit of the tax withheld shall be given to the assessee along with the necessary statutory interest. [Kartik Vijaysinh Sonavane Vs. DCIT [2021] (Gujarat)].
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CBDT issues Guidelines on scope of Sections 194-O, 194Q & 206C
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CBDT has issued set of guidelines for removing certain difficulties in implementing the provisions of TDS and TCS under sections 194-O, 194Q & 206C(1H). The board has clarified that no TDS u/s 194-O is required on e-auction services and the buyer and seller would still be liable to deduct/collect tax under Sections 194Q and 206C(1H). Further, clarifies that TDS u/s 194Q shall not be deducted on the component of VAT, excise duty, etc., if the same is indicated separately in the invoice. [Circular No. 13 of 2021 dated 25.11.2021]
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Reference u/s 144BA of the Act to invoke provisions of GAAR to be sent to specified address till the time secretariat of the Approving Panel under GAAR is set up. [F.No.226/29/2019/ITA-II dated 7th April, 2021]
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Provisions of Faceless Appeal apply only to Income-tax Act, 1961 and others laws like Wealth tax Act, Interest tax Act, Equalization Levy, STT, CTT are not included in scope [F.NO. 279/MISC.LM-44/2018-ITJ]
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CBDT clarifies that concessional tax rate of 5% shall continue to be applicable for interest income referred in section 194LD of the Act even after amendment in section 115AD of the Act [Press release dated 17.03.21]
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Payment for use of shrink-wrapped computer software by end user or distributor does not constitute 'Royalty' under DTAA [Engineering Analysis Centre of Excellence Pvt. Ltd. Vs. CIT & Anr. (SC)]
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Authority of advance ruling has inherent power to decline to pronounce advance ruling after admitting an application [AAR, New Delhi in case of Alstom Grid, AAR No. 1720 of 2015]
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CBDT notifies Faceless Penalty Scheme, 2021 applicable w.e.f. 12-01-2021 [CBDT Notification No/3/2021]
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Gujarat HC passes interim direction to CBDT for taking "an appropriate decision" by January 12, 2021 on extension of due dates for filing ITR [R/SCA NO. 13653 of 2020]
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CBDT to validate Unique Document Identification Number (UDIN) generated From ICAI portal at the time of upload of Tax Audit reports [Press release dated 26.11.2020]
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CBDT releases 34 more FAQs on provisions of 'Direct Tax Vivad se Vishwas Act, 2020 [Circular 21/2020]
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The President has given his assent to the Direct Tax Vivad Se Vishwas Bill, 2020 on 17 March 2020 for dispute resolution related to direct taxes.
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It was evident that relationship between assessee and HCL was that of principal to principal and not that of principal to agent and discount which was offered to distributors was given for promotion of sales. There was absence of a principal-agent relationship and thus, benefit extended to distributors could not be treated as commission liable for withholding tax under section 194H. [Nokia India (P.) Ltd. v DCIT Circle-10(2), (ITAT-Delhi)]
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A newly registered trust is entitled for registration under section 12AA of the Act on basis of its objects, without any activity having been undertaken [Ananda Social & Educational Trust vs. CIT (SC)]
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The income tax department has introduced facility of Instant PAN through Aadhar on the e-filing website for Individuals. Through which, PAN shall be instantly allotted online on the basis of Aadhaar without any requirement for filling up of detailed application form.
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The income tax department has put a new tax calculator for resident individuals on the e-filing website, through which, they can compare how much to tax is payable under existing & new tax regime i.e. which regime is better. Resident Individuals only need to enter age, income and total exemptions.
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A Common Application Form (CAF) for the purpose of registration, opening of bank and demat accounts and application for Permanent Account Number (PAN) has been notified for the Foreign Portfolio Investors (FPls) in India by the Ministry of Finance, Department of Economic Affairs (SEBI). CBDT has ,vide its notification no. 11/2020, notified the procedure for the same.
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Where wife of assessee started business of Futures and Options (F&O) by having some contribution from assessee in shape of gifts and incurred loss, entire amount of loss resulting from said business of F&O with gifts received from assessee was liable to be clubbed in hands of assessee in terms of Explanation 3 read in conjunction with section 64(1)(iv). Therefore, assessee was entitled to club full loss from business of F&O in his personal income. [Uday Gopal Bhaskarwar v ACIT (ITAT-Pune)]
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CBDT clarifies that TDS u/s 194K @10% is to be levied only on dividend payment by Mutual Fund and no tax shall be required to be deducted by the Mutual Fund on income which is in the nature of capital gains. (Press release dated 04.02.2020)
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Tribunal can’t dismiss appeal on account of non-appearance of party without giving findings on merits [Golden Times Services (P.) Ltd. vs. DCIT (Delhi HC)]
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CBDT has notified the ITR form 1 and 4 for the AY 2020-21 with certain amendments and additional information (Notification no. 1/2020)
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CBDT further extends due date for linking of Aadhaar with PAN till March 31, 2020 [Notification No. 107/2019]
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CBDT sets 31 March 2020 deadline to dispose 20,000 long pending appeals before CIT(A)
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CBDT amends Form 10DA i.e. accountant's report for claiming deduction u/s 80JJAA, seeks additional data/information pertaining to additional employees employed during the year and immediately preceding previous year for which deduction is claimed [Notification dated 18 December 2019]
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• Government Further extends due – date for Filing GSTR9 and 9C for FY 17-18 till 31st December, 2019 and for FY 18-19 to 31st March, 2020 along with simplification of various rules in the Form.
• CBIC issues clarification regarding the implementation of the newly inserted sub-Rule (4) to Rule 36 of the CGST Rules, which restricts the availment of ITC in respect of invoices or debit notes, for which the details have not been uploaded by the suppliers. Only 20% of total eligible credit as per details furnished by the supplier in GSTR-01 is allowed to be availed.
• CBIC ab-initio withdraws Circular No. 105/24/2019-GST wherein certain clarifications were given in relation to various doubts related to treatment of secondary or post-sales discounts under GST.
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Rectification application cannot be denied just because appeal or revision is pending against assessment order, as matter did not assume character of a sub-judice matter. (Piramal Investment Opportunities Fund vs. ACIT [Bombay HC])
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• Desktop Supply with CPU, Monitor, Keyboard & Mouse Together is a Single Supply, Taxable @ 18% GST
• CBIC is implementing a system for electronic generation of a Document Indentification Number (DIN) for all coomunications sent by its offices to taxpayers and other concerned persons.
• Any specified communication without DIN and is not covered by the exceptions shall be treated as invalid and shall be deemed to have never been issued.
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A 'power of attorney holder' is an 'agent' and 'Principal Officer' u/s 2(35). If a CA is granted a POA, service upon him of a notice is valid. If a notice is duly served upon the litigant through its authorized representative, and it was provided sufficient opportunity to appear before the Court and contest the matter but the litigant choses to let the matter proceed exparte, the order cannot be recalled. [PCIT vs. NRA Iron & Steel Pvt. Ltd (SC)]
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Argument of Revenue that loan taken from agents / dealers is on revenue account or that on waiver of the loan, its character undergoes a change and it becomes on revenue account is not correct. S. 28(iv) & 41(1) cannot apply if the loan is on capital account and the assessee has never claimed any deduction therefor in the past (Solid Containers 308 ITR 417 (Bom) distinguished, Mahindra and Mahindra Ltd 404 ITR 1 (SC) followed). [PICIT Vs. Colour Roof (India) Ltd. (Bombay HC)]
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No disallowance for TDS remaining 'unpaid' at year-end, if paid before due date of filing return of Income, despite assessee following cash system of accounting. [Associated Law Advisers Vs. ACIT (Delhi ITAT)
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• GST Council waived the requirement of filing FORM GSTR-9A for Composition Taxpayers for the FY 2017-18 and FY 2018-19
• The requirement of filing of FORM GSTR-9 for those taxpayers who (are required to file the said the return but) have aggregate turnover up to Rs.2 crores have been made optional for the FY 2017-18 and FY 2018-19
• New return system now to be introduced from April, 2020 (earlier proposed from October, 2019)
• GST Council has reduced GST rate on Hotel accommodation with Transaction value/unit/day till Rs.7,500/- at 12%
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Ministry of Law and Justice has noticed an ordinance to amend the Income-tax Act, 1961 and the Finance (No.2) Act, 2019. Corporate tax rates slashed to 22% for existing domestic companies and 15% for new domestic manufacturing companies subject to certain conditions.
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Show cause notice u/s 271(1)(c ) of Income Tax Act, 1961 would be bad in law if it didn’t specify the correct limb of Section 271(1)(c) under which penalty proceedings has been initiated i.e. whether for concealment of particulars of income or for furnishing of inaccurate particulars of income [PCIT vs. Sahara India Life Insurance Company Ltd (Delhi HC). ITA 475,426 to 429/2019]
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There is a difference between "issue" of notice and "service" of notice. Service of notice is a pre-condition for assuming jurisdiction to frame the assessment. Under Rule 127, service at the PAN address is valid even if it is different from the address in the Return. If a notice is issued but is returned unserved by the postal authorities and thereafter no effort is made to serve another notice before the deadline, it shall be deemed to be a case of "non-service" and the assessment order will have to be quashed. [Anil Kisanlal Marda vs. ITO-(ITAT Pune)]
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MCA extended due date of filing e-form BEN-2 till Sept 30, 2019.
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CBDT extends due date for filing return of Income for AY 2019-20 to August 31, 2019 for the assessees, who are required to file the return of Income by 31 July 2019.
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CBDT has given an option to taxpayers to either enter the scrip-wise details of long term capital gains (LTCG) in Schedule 112A and 115AD(1)(iii) OR enter the self-calculated aggregate value of LTCG directly under respective items in schedule CG in terms with Sec 112A or 115AD(1)(iii) without entering scrip wise details. (Clarification dated 19 July 2019)
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Where HC upheld addition made by authorities below relying upon statement made in course of search proceedings by director of assessee-company, since assessee failed to discharge its burden that admission made by director in his statement was wrong and said statement was recorded under duress and coercion, SLP filed against decision of High Court was to be dismissed. [Bannalal Jat Constructions (P.) Ltd. v ACIT- SC]
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SC dismissed SLP against High Court’s ruling that no disallowance u/s 14A of Income-tax Act, 1961 can be made in absence of exempt income earned during the year. [PCIT vs. GVK Project and Technical Services Ltd (SC)]
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If Income tax Act provides assessee to get valuation done from a prescribed expert as per prescribed method, then same cannot be rejected because neither Assessing Officer nor assessee have been recognized as expert under law [Cinestaan Entertainment (P.) Ltd. vs. ITO, Delhi ITAT]
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• The form ACTIVE has been made available by the MCA on 21st June, 2019 for filing purpose with a fee of INR 10,000.
• MCA vide its letter dated 24/06/19 to the ICAI has clarified that Auditors’ certificate is mandatory only in case of Return of Deposits &no need of audited financial statements as on 31st March, 2019 for filing form DPT-3 for reporting of particulars of transactions not considered as deposits.
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The benefit of standard deduction u/s 24 of the Act under the head Income from house property, is not allowable on rental income earned by charitable trust. [Nandlal Tolani Charitable Trust vs. ITO (ITAT - Mumbai)]
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“Interest Payment to creditors on their outstanding balance cannot be disallowed on a premise that no interest was being charged by the assessee from its debtors” [Aditya Medisales Ltd. Vs. Dy. CIT [Ahmedabad ITAT])
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CBDT extends terms of task force to draft a new direct tax law by another 2 monnths to July 31, 2019.
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CBDT condones the delay in filing of audit report in Form 10B by the trusts or institutions for the AYs 2016-17 and 2017-18. The condonation shall be granted subject to fulfillment of conditions prescribed by the CBDT.
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On 13th May, 2019, MCA has clarified that companies which had filed form ADT-1 as an attachment through form GNL-2 for appointment of auditors are required to file e-form ADT-1 up to June 15, 2019.
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Even after the decision of Maxopp Investment 402 ITR 640 (SC) which upholds the applicability of Section 14A disallowance on "strategic investments", the assessee is entitled to contend that the investments are "legacy" or "one-time" and that there is in fact no expenditure incurred to earn the tax-free income. [CIT vs. Alpha G. Corp Development Ltd., Delhi HC (ITA 599, 648, 655/2018)]
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The fact that the company is loss-making does not mean that shares cannot be allotted at premium. The DCF method is a recognised method though it is not an exact science & can never be done with arithmetic precision. The fact that future projections of various factors made by applying hindsight view cannot be matched with actual performance does not mean that the DCF method is not correct. [India Today Online Pvt. Ltd vs. ITO (ITAT Delhi)]
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MCA extended due date of filing e-form INC-22 A (Active) till June 15,2019.
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• Clarification has been issued in respect of utilization of Input Tax credit in accordance with old provision till the new order of utilization as per newly inserted rule 88A is implemented on the GST common portal
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• High court has confirmed action of department for charging interest in GST on gross amount without giving benefit of ITC available despite of council meeting wherein they have recommended interest to be paid on net tax liability
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As per settled law, notice for reopening of assessment against a dead person is invalid. The fact that the AO was not informed of the death before issue of notice is irrelevant. Consequently, the s. 148 notice is set aside and order of assessment stands annulled (Alamelu Veerappan 257 TM 72 (Mad) followed). (Rupa Shyamsundar Dhumatkar vs. ACIT [HC-Bombay])
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Linkage of PAN with Aadhar card is mandatory from A.Y. 2019-20 [Union of India vs. Shreya Sen (SC)].
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The judgement in PCIT vs. NRA Iron & Steel 103 TM.com 48 (SC) is distinguishable on facts & does not apply to a case where the assessee has discharged its onus to prove the identity, creditworthiness and genuineness of the share applicants by producing the PAN details, bank account statements, audited financial statements, Income tax return acknowledgments and the investors have shown the source of source & personally appeared before the AO in response to summon issued u/s 131 of the Act. [ITAT Kolkata in case of M/s Baba Bhootnath Trade & Commerce Ltd. vs. ITO]
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“Assessing Officer has to mandatorily dispose off the objection filed by an assessee, in response reassessment notice u/s 148, via speaking order. [HC of Karnataka in Mphasis Ltd. vs. ACIT]”
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Payment gateway charges paid to a bank for swiping credit cards are in the nature of fees for banking services and not "commission" or "brokerage". Accordingly, no TDS is deductible u/s 194H on the aforesaid charges [PCIT vs. Make My Trip India Pvt. Ltd.]
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