Taxpoint: September 2021

Thursday, September 30, 2021

DEFINITION OF PERSONS UNDER INCOME TAX ACT, 1961

DEFINITION OF PERSONS UNDER INCOME TAX ACT, 1961

According to section 2(31) of Income tax act person includes:

Individuals
Partnership Firms
HUF
Company
Association of person or body of individuals whether incorporated or not
Local authorities
Any other artificial judicial person not falling under any of the above sub sections

Assessee is a person who is liable to pay any tax or any other dues mentioned under the act.

However, from the above section it can be noted that person not only includes natural person but also artificial judicial person.

The types of persons mentioned under the sections are define as below:

Individuals: Individuals refers to natural human beings whether
Male or female or transgender
Major or minor
Resident or non-resident
Partnership Firm: A partnership is a contractual relationship between two or more individuals that have agreed to carry on a business represented by all or any one of them acting on behalf of all with an objective to share the profits obtained from the business. LLP are considered or taxed as a firm under Income tax act, 1961.
HUF: Hindu Undivided Family (HUF) is a family owned business covered as per the rules of Hindu laws that consists of all persons lineally descended from the same family having its head as Karta and members as coparceners. Jain and Sikhs families are also considered as HUF under this act.
Company: Company is a legal judicial entity that is formed under companies Act, 2013 or any other previous act. Companies includes
Any Indian company
Foreign company
Parent, Associate or subsidiary company
Statutory company
Government company
Any other sort of company
Association of company or body of Individuals: Association of persons means a group of person who have come together for achieving a common goal by working in the same direction. Members of AOP can be a natural or judicial persons.
Local authorities: Local authorities is an organization that is officially responsible for public services formed for providing services in a particular area.

Author- Adv.Shivam Kumar

Legal and content Executive, Taxblock India Pvt. Ltd

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SUKANYA SAMRIDDHI YOJANA AND TAX BENEFITS AROUND IT

SUKANYA SAMRIDDHI YOJANA AND TAX BENEFITS AROUND IT

Our Prime Minister, Narendra Modi launched the scheme named ‘Sukanya Samriddhi Yojana’ as a part of Beti Bachao Beti Padhao campaign. The government of India launched a social campaign on 22^nd January, 2015.The Beti Bachao Beti Padhao campaign gives awareness about ‘Save Girls, Educate the Girl Child’.

WHAT IS THE SUKANYA SAMRIDDHI YOJANA SCHEME?

The scheme basically talks about the major issues related to girl child education and marriage. So the scheme provides the fund to the parents of a girl child for proper education and for marriage expenses so that their girl child can have the brilliant future. For providing fund this scheme has initiate an account called Sukanya Samriddhi Yojana Account.

WHAT ARE THE TAX BENEFIT PROVIDED UNDER SUKANYA SAMRIDDHI YOJANA SCHEME?

The account opened under this scheme has provided under many tax benefits which is as under:

1.Investment made under Sukanya Samriddhi Yojana Scheme is eligible for deduction under Section 80C, conditional on maximum of Rs. 1.5 lakh.

2. The interest accrued on the investment is also eligible for tax exemption.

3. The amount which will be received on the maturity or withdrawn is also exempt from tax.

INTEREST RATE FOR SUKANYA SAMRIDDHI YOJANA SCHEME:

The rate of interest for the first quarter which is from 1^st April 2021 to 30^th June 2021 is 7.6%.
The rate of interest for the second quarter which is from 1^st July 2021 to 30^th September 2021 is remain same as first quarter i.e. 7.6%.
If any default arises in account opened under this scheme like where the amount of deposit which is Rs. 250 has not been deposited then the rate of interest will be under post saving bank account.

Provided that the default shall not be under the death of the person who opened an account under the scheme.

HOW YOU CAN CALCULATE THE INTEREST UNDER SUKANYA SAMRIDDHI YOJANA SCHEME?

The interest under this scheme is compounded on a yearly basis, so the interest for Sukanya Samriddhi Yojana Account is calculated on the lowest balance for the calendar month which means between the 5^th day of the month and the end of the month. The interest accrued on this account is credited in the account at the end of the financial year.
For calculating the interest you can follow the below formula:

A= P(1+r/n)^nt

In which it says,

A = Amount at maturity

P = Initial deposit

r = Rate of interest

n = Number of years the interest compounded

t = Number of years.

WHO CAN WITHDRAW MONEY FROM SUKANYA SAMRIDDHI YOJANA ACCOUNT?

The Girl Child in whose name the account has opened can only withdraw the amount from the account on maturity and until the girl child attains the age of 18 years her guardian can withdraw the amount from the account.

WHAT IS THE MINIMUM AMOUNT CAN BE INVEST IN SUKANYA SAMRIDDHI YOJANA ACCOUNT?

The guardian of a girl child who opened an account in Sukanya Samriddhi Yojana Scheme can deposit any amount from Rs. 250 to Rs. 1.5 lakh in a financial year.

Author- Adv.Shivam Kumar
Legal and content Executive, Taxblock India Pvt. Ltd

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INCOME TAX PORTAL AND BENEFITS AROUND IT

INCOME TAX PORTAL AND BENEFITS AROUND IT

The new income tax portal https://ift.tt/3zdEq0H was launched by CBDT on 7^th June, 2021. he portal has been redesigned so as to provide the facility of Income tax return filing in a modern and seamless manner.

STRUCTURE OF THE NEW INCOME TAX PORTAL

The new income portal can be assessed according to the following ways:

On the homepage, on top of the page there are respective tabs to find out how to check the refund, deductions, applicable forms, and the process to file the ITR..

After it, there are various services such as ITR status, refund status, linking of Aadhaar, and e-verification.

At the bottom of the page, there are various videos that will guide about the website

In case you wish to avail the services of the portal, the registration process must be completed.

BENIFITS OF NEW INCOME TAX FILING PORTAL

ITR PROCESSING: The new income tax portal will immediately process the income tax return filed by a taxpayer which enables quick refunds to the taxpayers.

Free ITR Preparation Software: The new portal provides free ITR preparation software for conveyance of taxpayers. Currently only ITR-1 and ITR-4 software are available online and offline, while ITR-2 is available only in online mode.

Call Centre Services: The new web portal with a ‘new call centre’ for immediate response to queries. Additionally, the call center will also deal with detailed faqs, tutorials, videos and chatbot/live agents etc.

Single Dashboard Interaction: A taxpayer can get all the details regarding interactions, uploads, and pending actions in a single dashboard along with the follow-up action.

Multiple Payment Options: The new portal will come with multiple payment options for a taxpayer which includes RTGS/ NEFT, credit card, UPI and net banking via any account of a taxpayer in any bank.

Mobile Application: Income tax department have also launched a new web development app where the taxpayer can easily access the app via a mobile network at any point in time.

Pre-filled ITRs: The new portal allows pre-filling of specific details which relates to Salary, house property, business/profession, interest, dividend and capital gains etc.

In case of any assistance required please contact at incometax@taxblock.in

Author- Adv.Shivam Kumar
Legel and content Executive, Taxblock India Pvt. Ltd

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UNDERSTANDING DIFFERENT DEPOSITS AND APPLICABLE TAX BENEFITS AROUND IT

UNDERSTANDING DIFFERENT DEPOSITS AND APPLICABLE TAX BENEFITS AROUND IT

Firstly if we talk about banks, we all are about the banks and the scheme they provide if you have visited or opened an account in bank. Bank and money are the words we use normally for our day to day life, if we put our money in the bank we considers it to be safest mode.

Bank gives scheme under different types of deposit and account. In this article we will discuss about them in detail and we will also discuss the tax benefits you get under Income Tax Act.

TYPES OF DEPOSIT:

Bank deposit may be classified as follows:

Saving Bank Account;
Current Deposit Account;
Fixed Deposit Account;
Recurring Deposit Account.

Now we will discuss this in detail,

1. Saving Bank Account:

If we talk about Saving Bank Account as it says it is suitable for people who wants to save some money from their salary and who have fix salary so that they can save monthly. The account can be opened in any bank but the bank keeps some minimum balance that has to be maintained in the bank account. The deposit amount can be minimum and can be opened easily.

For e.g. the people who get salary or is a labourer can open a saving bank account easily.

The interest rate on this type of account will be different for every type of bank and the minimum amount that should be maintained can also be differ from bank to bank. The person who wants to withdraw money from this account can fill the withdrawal form or they can issue cheque or by using an ATM can withdraw the amount from this account. Also through the net banking they can operate these account. You can link GPAY, BHIM, PAYTM etc. also with these accounts. This is the most commonly used accounts amongst the people.

TAX BENEFIT UNDER SAVING BANK ACCOUNT:

Here, the interest which accrues on the amount deposited is taxable under the head of “Income of Other sources”.

Provided that the interest is applicable for deduction under Section 80TTA up to Rs. 10,000. So basically interest earned beyond Rs. 10,000 is taxable in case you are a normal citizen.

If you are a senior citizen then you cannot claim the benefit of 80TTA, but you can claim the similar benefit under 80TTB and also to the extent of Rs. 50,000.

2. Current Deposit Account:

This types of account is suitable for businessman, companies, institution like school, colleges and hospitals. In this type of deposit the person can withdraw the amount easily whereas the saving bank account has some restriction on withdrawal which is not suitable for this above mentioned person.

Even in this type of account you have to maintain some minimum amount in the account. Here, the bank don’t provide any interest on the balance amount after withdrawal, but the account holder has to pay a certain amount at the end of the year as operational charge.

TAX BENEFIT UNDER THIS SCHEME:

Account opened under Current Deposit Account, is wholly tax free as the holder is not getting any interest in this type of account. But, holder has to pay income tax on the income earned through the funds from this account.

3. Fixed Deposit Account:

There are person who wants to save their money by earning at more interest rate, so they save into fixed deposit account as the banks give more interest rate in this type of account then saving bank account. Here, the customer can save from as low as 7 days to as far as ten years and can withdraw the amount on the maturity.

However, the amount can be withdraw before its maturity if the customer makes request to the banks. The only thing is here in case of withdrawing money before the maturity will attract lower rate of interest. The customer can renew for the further period or can withdraw the money at the end of the maturity.

TAX BENEFIT UNDER FIXED DEPOSIT ACCOUNT:

There’s a scheme called tax saving fixed deposit account under which a person can claim the deduction up to Rs. 1.5 lakh per annum under Section 80C of the Income Tax Act. A lock in period for this scheme is 5 years and the interest rate ranges from 5.5% to 7.75%.

4. Recurring Deposit Account:

Account under this scheme can be opened individually or jointly or by the guardian of the minor. There is an amount fixed for a certain period. The total amount and interest on the same will be payable upon the maturity.

However, the account holder can also withdraw the amount before its maturity but, the interest rate will be lower in this case and differ from bank to bank. The interest rate received by the person in this type of account is higher than the saving bank account but lower than the fixed deposit account.

There are different type of Recurring Deposit Account as follows:

Home safe Account:
Cumulative-cum-Sickness deposit Account:
Home Construction deposit Scheme/Saving Account:

TAX BENEFIT UNDER THIS DEPOSIT ACCOUNT:

Recurring Deposit Account attracts a TDS of 10% as a deduction on the returns earned if the total interest is more than Rs. 10,000.

Author- Adv.Shivam Kumar

Legal and content Executive, Taxblock India Pvt. Ltd

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UNDERSTANDING LOANS, TYPES OF LOANS FOR INDIVIDUALS & BUSINESSES AND TAX BENEFITS AROUND THEM

UNDERSTANDING LOANS, TYPES OF LOANS FOR INDIVIDUALS & BUSINESSES AND TAX BENEFITS AROUND THEM

WHAT IS LOAN?

One day you think to have a house and for that you don’t have enough money to purchase it, so you go to the bank and ask them for provide you with enough money to purchase a house. The money you took from a bank is called as loan. Here the bank will be known as lender who provides the loan, the bank provide loan on certain guarantee so that they have something on which behalf you will repay the loan which will also have some benefits, interest rate. The whole process is called as loan.

Now if we talk about the component of loan then there’s three components such as principal amount that is the amount provided as a loan, then there’s an interest rate and lastly the period for which the loan is taken.

TYPES OF LOAN:

FOR INDIVIDUAL:

The loan which can be availed by the individual is called as personal loan. There are following types of personal loans:

1.Wedding Loan:

Indian weddings are really expensive and we all are aware about it. It can take all of your savings, so rather than spending all of your savings you can just take a loan which can ease your wedding expenses.

2. Home renovation Loan:

This loan can help you getting a new look of your house and also handles the cost of maintenance of work, and also for refurnishing or redecoration of your house and many more.

3. Medical Loan:

If you don’t have any insurance and there’s an urgent need of medical expenses then you can apply under this loan, this is the easiest to apply and you will have low interest rate in this type of loan.

4. Higher Education Loan:

If you want to take higher education and you don’t have sufficient money to get the education then you can take high education loan which will help you getting education in abroad and also finance other things such as travel, living expenses and many more.

5. Small Personal Loan:

If you are in urgent need of loan and you are not able to arrange it you can opt for small personal loan.

TAX BENEFITS ON PERSONAL LOAN:

Generally personal loan don’t provide any tax benefits except in the following case:

If the payment made towards interest of personal loan and it is recognizable for the use of purchasing a house or for renovation house then it is eligible or deduction under sub-section (b) of section 24 of the Income Tax Act, 1961.

FOR BUSINESS:

1. Long-term Loans:

TAX BENEFITS ON BUSINESS LOAN:

Business loan interest is eligible for exemption.
The principal amount of loan do not provide any tax benefit.
The interest is usually deducted from gross income.
To avail the deduction of interest you have to fulfil some criteria.
Repayment amount which is EMI is not eligible for deduction.

Author- Adv.Shivam Kumar
Legal and content Executive, Taxblock India Pvt. Ltd

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Job Opportunity at American Express Global Business Travel for Payroll Accounting & Reconciliation

Job Opportunity at American Express Global Business Travel for Payroll Accounting & Reconciliation

American Express Global Business Travel is looking for Accountants for Payroll Accounting & Reconciliation for GBT.

American Express Global Business Travel (GBT) is the world’s leading business partner for managed travel. We help companies and employees prosper by making sure travelers are present where and when it matters. We keep global business moving with the powerful backing of 16,000 travel professionals in more than 140 countries. Companies of all sizes, and in all places, rely on GBT to provide travel management services, organize meetings and events, and deliver business travel consulting.

Job Responsibilities

Account Analyst for Payroll Accounting & Reconciliation is required to move payroll processes from the EMEA regions to the US markets.
GBT’s Global Payroll Reconciliation processes are being managed.
Validate the Pay report to ensure that the correct data is being sent to the payroll processor.
Bank reconciliation, general ledger, and sub-ledger reconciliation all require reconciliation and data analysis.
To collect and give required explanations, coordinate with HR and other stakeholders.
Perform payroll controls to guarantee that the payroll report is accurate.
Assist with internal and statutory audits as needed.
Participate in tasks involving payroll.
Carry out ad hoc payroll-related tasks.
Assist the team leader with projects and other payroll duties.
Maintain relationships with key points of contact across processes and other functions, both internally and externally with payroll outsource vendors, to maintain a grasp of the process context and discover both intraprocess and crossprocess improvement opportunities.

Requirement

A minimum of 5 years of expertise in the accounting process is required.
It will be advantageous if you have prior experience working in a shared services setting.
It will be advantageous if you are familiar with payroll accounting entries.
Problem-solving abilities, as well as written and vocal communication abilities
In a fast-paced environment, the ability to provide outcomes is essential.
Self-motivation and drive, as well as the capacity to work autonomously
An grasp of customer attention and service delivery, as well as the capacity to create strong customer relationships.
a track record of meeting deadlines
Communication and interpersonal abilities that are clear and effective, as well as team player attributes

Location

India>Haryana>Gurgaon

Link

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WHAT IS GST – UNDERSTANDING FROM THE IMPLEMENTATION PHASE

WHAT IS GST – UNDERSTANDING FROM THE IMPLEMENTATION PHASE

WHAT IS GST?

GST is called as Goods and Service Tax which is an indirect tax and passed in the parliament on 29^th March 2017 and came into force on 1^st July 2017. This is an indirect tax which has replaced many indirect taxes such as VAT, excise duty etc.

As the name suggest the GST is imposed on supply of goods and services. It is the destination based tax. It was introduced to reduce the cascading effect on tax. It is the single domestic indirect tax law in India. The tax is imposed at every stage of supply.

Let us understand the meaning of destination based tax by giving one example: so let’s consider that the goods are being manufacture in Maharashtra and is going to supply in Gujarat, so basically the consumption is in the Gujarat the tax will be levied in Gujarat and not in Maharashtra.

JOURNEY OF GST:

It took 17 years to pass the GST law in India. The journey of GST started in the year of 2000 when a committee drafted law. Lok Sabha and Rajya Sabha passed the GST Bill in the year of 2017. And finally on 1^st July 2017 the GST was came into force.

OBJECTIVE OF GST:

1.To reach the idea of ‘One Nation One Tax’:

GST has replaced many indirect taxes and now the GST is only tax which is being followed by all the states and it is the advantage as all the state follows the same rate of tax. It became easier for the Central Government to decide the rate and policies.

2. To reduces the cascading effect:

It is the very first objective of GST that is to reduce the cascading effect. Before GST there was many indirect taxes in which the taxpayer was not able to set off the credits. If we understand this by giving an example then, the excise duties paid during the manufacturing of goods will not be set off against the VAT payable during sale.

3. To expand the taxpayer base:

Before GST there was different limits for registration based on turnover. As GST is imposed on both goods and services, it has risen the registered businesses. So the GST is helped in extended the tax in India.

ADVANTAGE OF GST:

Eliminate the cascading effect;
Higher the limit for registration of GST;
Small business can also opt for composition scheme;
Making more simple online facilities for compliance of GST;
GST has relatively lesser compliances;
GST has also defined the treatment for E-Commerce activities;
It extended the efficiency in logistics;
It also regulates the unorganized sectors.

COMPONENTS OF GST:

There are three taxes which is applicable under GST which is:

CGST: It is the tax which is collected by the Central Government, and it is imposed on intra state supplies. For e.g. transaction which happens in Maharashtra.
For e.g. transaction which happens between two states.

Author- Adv.Shivam Kumar

Legal and content Executive, Taxblock India Pvt. Ltd

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Format of Affidavit to be filed with Petition for Judicial Separation under Section 10 of Hindu Marriage Act

Format of Affidavit to be filed with Petition for Judicial Separation under Section 10 of Hindu Marriage Act

IN THE COURT OF THE _____________ JUDGE AT _________

H. M. A PETITION NO _______ OF 20__

IN THE MATTER OF:

MRS. _________

PETITIONER

VERSUS

MR.__________

RESPONDENT

AFFIDAVIT

I, Ms. _______________ Wife of _______________ Daughter of ___________ aged _________ years, presently residing at _________________________, do solemnly affirm and say as follows:

That I am the Petitioner in the accompanying Petition under Section 24 of Hindu Marriage Act, 1955 and well acquainted with the facts of the case. I am competent to sear to this affidavit.
That I have gone through the contents of the accompanying Petition, I reaffirm the contents of the Petition, which are not being repeated here, for the sake of brevity.
That, I was married to the respondent at ____________, on _________, as per Hindu rites and ceremonies.
That, the details laid out in the accompanying petition, with regard to the age, status and place of residence of the deponent before marriage and at the time of filing this petition, may be treated as part of this affidavit.
That, after the said marriage, the deponent lived with the respondent at his residence till and on the respondent, without any cause or justification, left the matrimonial home and started living with her parents.
That, the respondent has withdrawn from the company of the deponent and all the efforts of the deponent to bring the respondent back to the matrimonial home have come to naught in the wake of the respondent’s unflinching intention to live separately from the deponent.
That, since the respondent is not at all inclined to live with the deponent, it is in the interest of justice that judicial separation may be ordered.
That, there has not been any unnecessary or improper delay in filing this petition.
That, there is no other legal ground why the relief should not be granted.
That, there have not been any other previous proceedings between the parties.

DEPONENT

VERIFICATION

I, _______________the above named deponent do hereby verify on oath that the contents of the affidavit above are true to my personal knowledge and nothing material has been concealed or falsely stated therein.

Signed and verified this _______ day of _______ 20 _______ at _______

DEPONENT

Solemnly affirmed and signed before me by the deponent, who is personally known to me, on this the _____ day of ________ ,20__.

COUNSEL FOR THE DEPONENT

Disclaimer: – This is only a knowledge sharing initiative and author does not intend to solicit any business or profession. I assume no responsibility for the consequences of use of such information.

The Author can be reached on saxenatanuj5@gmail.com , 9140389470, 8853774256

TANUJ SAXENA AND ASSOCIATES

COMPANY SECRETARIES

LUCKNOW, NOIDA AND PATNA

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Format of affidavit for Writ Petition Seeking Writ of Mandamus in High Court

Format of affidavit for Writ Petition Seeking Writ of Mandamus in High Court.

Affidavit for Writ of Mandamus under Article 226 of the Constitution to be filed in High Court.

Writ of Mandamus under Article 226 is issued as a command to an inferior court or ordering a person to perform a public or statutory duty.

IN THE HIGH COURT OF PRAYAGRAJ AT PRAYAGRAJ
EXTRA ORDINARY CIVIL JURISDICTION

WRIT PETITION (CIVIL) NO. OF 20__

IN THE MATTER OF:
———————————-

PETITIONER

VERSUS

—————————- OF————————– & ORS

RESPONDENTS

AFFIDAVIT

I, __________________ , S/o Shri _______________, Aged about ___ years, R/o ___ ________________ _______________ the Petitioner do hereby solemnly state and affirm as under:

That I am one of the Petitioner of the instant Writ Petition and being conversant with the facts and circumstances of the case, am competent to swear this Affidavit.
That the other Petitioners have authorized me to sign and file the present Writ Petition.
That I have read and understood the contents of the abovementioned writ petition and I state that the same are true and correct to my knowledge.
That all the Annexures annexed to the writ petition are true copies of their respective originals.
I have done whatsoever inquiry/investigation which was in my power to do, to collect all data/material which was available and which was relevant for this court to entertain the present petition.
I further confirm that I have not concealed in the present petition any data/material /information which may have enabled this court to form an opinion whether to entertain this application or not and/or whether to grant any relief or not.
That I have read and understood the content of Writ Petition. I have read and understood the contents of the accompanying synopsis & List of Dates at Pages ____ to ______, Writ Petition at Pages ___ to ____, Para ____ to ____, Grounds ____ to ____ and all accompanying Applications. I state that the facts therein are true and correct to the best of my knowledge and belief. I further state that the Annexure annexed to the Writ Petition are true copies of their respective originals.

DEPONENT

VERIFICATION:
Verified at Prayagraj on this ___ day of _______ 20__ that the contents of my aforesaid affidavit are true and correct to my knowledge and belief. No part of it is false nor has anything material been concealed there from.

DEPONENT

The Author can be reached on saxenatanuj5@gmail.com , 9140389470, 8853774256

TANUJ SAXENA AND ASSOCIATES

COMPANY SECRETARIES

LUCKNOW, NOIDA AND PATNA

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WHAT IS E-INVOICING AND WHICH ALL BUSINESSES ARE REQUIRED TO GENERATE E-INVOICING?

WHAT IS E-INVOICING AND WHICH ALL BUSINESSES ARE REQUIRED TO GENERATE E-INVOICING?

The e-invoicing was introduced on 1^st October 2020, for tax payers with an aggregate turnover exceeding Rs. 500 crore. This was also extended on businesses from 1^st January 2021 whose aggregate turnover is exceeding Rs. 100 crore. The CBIC also informed that e-invoicing will also applicable for businesses with total turnover ranging between Rs. 50 crore to Rs. 100 crore from 1^st April 2021.

WHAT IS E-INVOICING?

E-invoicing or electronic invoicing is a system where you can raise invoices, and the invoices generated under this system can also read with other system. It also reduces the need for any fresh data entry or errors. The invoices generated under this system has standardised format and the data can also be shared with others.

WHICH ALL BUSINESSES ARE REQUIRED TO GENERATE E-INVOICING?

E-invoicing is compulsory from 1^st October 2020, to all the businesses whose aggregate turnover exceeds Rs. 500 crore in any financial year from 2017-2018 to 2018-2019. And it also started too applicable on businesses whose aggregate turnover exceeds Rs. 100 crore in any financial year from 2017-2018 to 2019-2020 from 1^st January 2021. In addition to this from 1^st April 2021 it is applicable to businesses with a total turnover of more than Rs. 50 crore.

Irrespective of the turnover, E Invoicing is not applicable to the below registered persons: Though e- invoicing is not applicable to following registered person, no matter what the turnover is:

An insurer or a banking company or a financial institution which includes an NBFC;
A Goods Transport Agency;
A registered person who supplies passenger transportation services;
A registered person who supplies services by way of admission to the exhibition of cinematographic films in multiplex services;
A Special Economic Zone unit;
- Note: As per notification no. 61/2020 SEZ, units are exempted from issuing e-invoice. No exemption is available for SEZ developers.
A department of government and local authority.

BENEFITS OF E-INVOICING:

There are some benefits of e-invoicing which is as follows:

The data under form GSTR-1 is all kept ready for filing while using e-invoicing system.
It helps in eliminating reporting in multiple formats as it generates invoices while one time reporting of B2B invoices.
With the use of e-invoice data you can also generate E-way bills.
There is minimum need for data settlement between books and GST returns which is filed.
It also eliminate the verification of Input Tax Credit issues.
It helps in better management and self-operating of the tax filing process.
E-invoicing can reduces the number of frauds as the access is also with the tax authorities. And,
Lastly it also eliminates the generation of fake GST.

SUPPLIES CURRENTLY COVERED UNDER E-INVOICING:

E-invoicing currently applies to:

Supplies which is made to registered person;
Supplies which is made to Special Economic Zone;
Export supplies; and
Deemed export supplies.

IS E-INVOICING IS APPLICABLE TO NIL RATED OR WHOLLY EXEPMT SUPPLIES?

In the types of supplies which is nil rated or wholly exempt then the e-invoicing is not applicable as in these cases no invoice is created but bill of supply is issued, so e-invoice will not be applicable to the supplies which is nil rated or wholly exempt.

Author- Adv.Shivam Kumar
Legal and content Executive, Taxblock India Pvt. Ltd

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Job Opportunity at IFC (World Bank Group) for Qualified CA/CPA for Financial Analyst

Job Opportunity at IFC (World Bank Group) for Qualified CA/CPA for Financial Analyst

IFC (World Bank Group) is looking for Financial Analysist in Finance & Accounting Sector.

Description

The International Finance Corporation (IFC), a member of the World Bank Group, is the world’s largest development bank concentrating on the private sector in emerging nations. We work in over 100 countries, utilising our cash, experience, and clout to help developing countries develop markets and opportunities. As nations cope with the effects of the COVID-19 epidemic, the IFC committed a record $31.5 billion to private enterprises and financial institutions in developing countries in fiscal year 2021, utilising the private sector’s potential to reduce extreme poverty and increase shared prosperity. Visit www.ifc.org for additional details.

Financial Operations (loan, equity, and short-term finance operations, as well as back-office treasury support operations), Financial Reporting (including reporting and analysis, portfolio review, investment accounting, and accounting policy), Internal Controls, and Financial Integration, Systems, and Projects are all managed by the IFC Controllers Department (CNT). The Department employs roughly 125 people in Washington, DC, and Chennai, who are diverse and highly skilled.

The Controllers’ Portfolio Review unit (CNTPR) provides governance and oversight on IFC’s investment products subject to loss provisioning across all industries and geographical regions, especially from a financial reporting standpoint. Individual and portfolio loss reserves against loans, guarantees, debt securities, trade financing facilities, and other receivables, as well as write-downs in the Investment Portfolio, are among the specific governance obligations.

In addition, the unit hosts quarterly portfolio review meetings with IFC Portfolio Managers, which serve as a focal point for discussion of portfolio issues that affect financial reporting, bringing together key stakeholders in Credit, Risk, Portfolio Management, and Financial Operations.

Given the complexity of both IFC’s portfolio and the accounting rules under which IFC prepares its financial statements (US GAAP), the function is called upon to blend knowledge about valuation principles for non-traded investments, credit analytics, and an ability to analyze macro developments impacting IFC’s Investment Portfolio with sound knowledge of complex accounting requirements to ensure proper recording of portfolio matters in IFC’s financial statements.

CNTPR is in charge of IFC’s Investment Portfolio Accounting and Reporting (IPAR) system, which ensures that the organization’s monthly financial reports are correct. IFC’s accounting and financial reporting system, IPAR, is used to document, calculate, and report loss reserves in the Investment Portfolio.

CNTPR is also the point of contact for loan loss reserve audits on a quarterly and annual basis, as well as loss provisioning and portfolio reporting trainings at headquarters and in the field.

Part of CNTPR’s work programme has been co-located in IFC’s Chennai office under the Financial Reporting (CNTFM) unit. CNTPR is looking for a skilled Financial Analyst to support the delivery of all areas of CNTPR’s work programme. This person will report to the Team Leads of CNTPR in Washington DC and CNTFM in Chennai. The candidate must have prior financial analysis experience, including understanding of US GAAP and/or IFRS as they apply to IFC and its product lines, as well as superior analytical and quantitative abilities, including the ability to work with massive data sets.

This position allows you to gain experience with the computation of individual and portfolio loan loss reserves, as well as first-hand knowledge of portfolio investment financial reporting. Furthermore, the position provides opportunities for skill development in credit analysis and valuation of IFC’s global investment portfolio.

Duties & Responsibilities:

The Financial Analyst is an important element of the CNTPR team who works closely with internal counterparts in Controllers departments as well as external clients in Investment/Portfolio, Credit, Risk, Treasury, and IT departments in Washington, DC, Chennai, and other field locations. Her/his responsibilities and tasks will include, but not be limited to:

Prepare analytical documents and assist IFC Portfolio Managers and teams with quarterly portfolio review meetings.
Assist in the development of quarterly analytic presentations for Senior Management.
Close the IPAR system on a monthly basis, calculate and report loan loss reserves and Investment Portfolio write-downs to the Reporting and Analysis Unit (CNTRA) for inclusion in IFC’s financial statements. Carry out the necessary quality checks to ensure that these items are accurately recorded and reported.
Ensure the integrity and correctness of loss reserves data in the IPAR system, and collaborate with other business and IT teams to resolve system and portfolio data issues, as well as system enhancements required for the IPAR portfolio review, closure, and reporting processes to run smoothly.
Maintain and improve data reporting and visualisation tools for loss reserves.
Respond to requests for information about loss reserves and investment write-downs from external auditors, internal controls, and other departments.
As needed, ad hoc analytical initiatives

Selection Criteria

Bachelor’s or master’s degree in finance, accounting, business, economics, or risk management is preferred. A CFA, FRM, CA/CPA, or CGMA certification would be advantageous.
At least three years of post-qualification experience in the financial services business is required. Experience in the private sector and/or with the IFC would be advantageous;
Excellent data analytics abilities, including the ability to work with big Excel data sets;
Excellent English communication skills, including strong writing, editing, and reporting abilities;
Excellent organizational and project management abilities. Candidate should be detail-oriented while still being able to see the big picture;
Ability to operate in a fast-paced atmosphere and create high-quality solutions while meeting tight deadlines and multitasking as needed;
High level of self-motivation and demonstrated ability to work with little supervision and in a multicultural team across time zones.

Link to Apply

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Job Opportunity with ABB for Qualified CA/CMA/MBA

Job Opportunity with ABB for Qualified CA/CMA/MBA

Take your next career step at ABB with a global team that is energizing the transformation of society and industry to achieve a more productive, sustainable future.

At ABB, we have the clear goal of driving diversity and inclusion across all dimensions: gender, LGBTQ+, abilities, ethnicity and generations. Together, we are embarking on a journey where each and every one of us, individually and collectively, welcomes and celebrates individual differences.

Global Business Services (GBS) is ABB’s shared services organization which delivers operational and expert services in Finance, Human Resources, Information Systems, Legal, Global Travel Services and external Customer Contact Centers. With employees based in five main hubs and front offices, GBS provides mainly Business services to ABB teams across the globe as well as supports with external customer inquiries.

This is a Financial Planning & Analysis – Specialist role, reporting to the Financial Planning & Analysis – Process lead in the Global Business Services, located in Bangalore, India. As a FP&A Specialist, you will lead a team of FP&A Analyst providing Financial Planning and Controlling expertise to the organization by compiling and analyzing metrics, identifying trends and problems, communicating information to relevant groups and recommending actions to improve financial performance.

Your key responsibilities

Performing analysis of business performance versus budget and forecast, performing benchmarking of key performance indicators with external and internal peers.
Working with the other financial professionals in Divisions / Regions / Countries and functions to understand and analyze the drivers of financial performance and identify trends. Preparing financial analysis for various “what if” scenarios and sensitivity analysis and the overall impact to the business units. Preparing analysis of overhead under / over absorption indicating root cause, preparing and analyzing Product / Customer profitability, calculating labour hour rates and overhead absorption rate for different business scenarios, performing cost / benefit analysis, Net Present Value vs. Internal Rate of Return (NVP / IRR) analysis and payback period for capex initiatives, analyzing of inventories and net working capital (NWC) and preparing ad-hoc reports as per Business units’ request.
Supporting preparation of relevant organization financial reporting, business planning, budgeting and forecasting. Validating accuracy of financial data and business information and reports by performing reconciliation and review of exceptions.
Providing information to management by assembling and summarizing data, preparing reports, presentation of findings and analysis.
Optimizing own performance to increase productivity by developing automated solutions, eliminating duplications, coordinating information requirements, recommending changes of process standards and procedures to improve the timely performance of process activities and identifying areas for process / report standardization across different countries, divisions and business units.
Ensuring processes and controls within own area of responsibility are designed and implemented in line with Group and unit requirements, maintaining proper audit trail and documentation for future tax / internal / external audits and reviews, ensuring standard operating procedures (SOPs) are prepared and updated regularly for all activities performed by the team, ensuring service delivery of the team is within the agreed service-level agreement (SLA) and Key Performance Indicator (KPI).

Skills and attributes for success

Bachelor’s degree in accounting with CMA/ CA / MBA.
Minimum 5 years of experience in Accounting and Finance in a manufacturing unit with 2+ years of experience in FP&A is preferable.
Strong analytical and problem-solving skills with thorough / detail-oriented approach.
Strong communication skills with fluency in English.
Hands on experience in SAP FICO and COPA modules, experience with MS Office.
Basic knowledge of Sales & Distribution, production planning, projects, material master modules in SAP.
Ability to work with diverse teams across different countries, being self-motivated with a strong commitment to quality.

Link to Apply

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WHAT IS AUDIT AND WHAT ARE THE DIFFERENT TYPES OF AUDITS

WHAT IS AUDIT AND WHAT ARE THE DIFFERENT TYPES OF AUDITS

WHAT IS AUDIT?

Audit is the activity of evolution and determine the financial, operational and strategic goals and exercise in an organizations to decide if the organization is in accordance with the rules and regulations. To see if an organization is in accordance with all the rules and regulations, is one of the most important object of the auditing. It is one of the primary goal and the reason why an organization conduct audit.

WHAT ARE THE DIFFERENT TYPES OF AUDIT?

Now, audit is compulsory so an organization conducts audit and spend their time in arranging all the books and accounts to carry out the audit procedure. There are several types of audit amongst them financial audit is one of the most popular and after that there are operational and strategic audit and there’s also an audit which is IT i.e. Information Technology audit. All the organization carries their audit by both Internal and External Auditors.

There are following types of Audit:

1. Internal Audit:

As the name suggests it is an audit of internal affairs, the audit is carried out to decide if the internal part of the organization is as per the rules and regulations or not. The internal audit can be done by anyone even by the employee of the organization and that’s where it lacks, the employee can cover things up and it is not as thorough as external audit. In this type of the audit the auditors check if the organization is following proper norms, rules, and whether it compliance with all the internal regulatory norms.

2. External Audit:

External Audit can be compulsory to some of the organization as per some rules and requirement of shareholders. The report of external audit shall be also shown to all the shareholder in annual general meetings and board of directors meeting. External audit is done by some independent professional person who possesses such qualification mentioned in the rule. External audit can be done annually, half yearly or quarterly. If some of the organization feels that there are something which is not properly visible to seniors then also they can conduct external audit. The organization can also appoint third party to conduct audit in the organization.

3. Financial Audit:

As we discussed above financial audit is really important for the organization as the shareholder invests money in the business and they need to know if their money are being properly used or not. Money is the profit for the business and making profit is one of the objective of business, and it is an income for the organization. Financial audit is an audit of the books of accounts and to know if the organization is expressing the true books of accounts or hiding some facts from their investors.

4. Information Technology Audit:

Information Technology Audit (IT Audit) is carried out to assess the organization’s IT infrastructure and to know the system of the organization. To see if there are any IT risks. Nowadays IT audit is really common as increase in nature, types and many types of IT risks and also increasing the complexity of the IT infrastructure. It is done to inform the stakeholder’s that the organization’s IT structure is up to date and it is also able to meet the goals and objectives.

5. Statutory Audit:

This audit is conducted by the organization to see if the organization is in comply with all the Government regulations. It is verify by the external auditor while doing the external audit and also verify some of the financial reports which includes:

statements of bank;
number of clients;
earning on investment. Etc.

The audit improves the transparency and trust among all the public and stakeholder of the organization.

Author- Adv.Shivam Kumar

Legal and content Executive, Taxblock India Pvt. Ltd

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ECLGS’ scope expanded and scheme extended till 31.03.2022

ECLGS’ scope expanded and scheme extended till 31.03.2022

Since its inception, the Emergency Credit Line Guarantee Scheme (ECLGS) has provided relief to over 1.15 million Micro, Small and Medium Enterprises (MSMEs) and companies. It has assisted qualifying borrowers in satisfying their operating obligations and resuming their companies following the COVID-19 pandemic’s disruptions.

Loans sanctioned under the Scheme have surpassed Rs. 2.86 lakh crore as of September 24, 2021, and nearly 95 percent of all guarantees granted are for loans sanctioned to Micro, Small, and Medium Enterprises.

Various industry associations and other stakeholders have urged the government to prolong the scheme in order to ensure that qualifying sectors and firms continue to receive help. It has been decided to extend the timeline of the Emergency Credit Line Guarantee Scheme (ECLGS) until 31.03.2022 or until guarantees for an amount of Rs 4.5 lakh crore are issued under the scheme, whichever comes first, in order to support various businesses impacted by the second wave of COVID 19 pandemic. Furthermore, the scheme’s final distribution deadline has been extended until June 30, 2022.

The scheme has been modified to allow firms affected by the second wave of COVID to get assistance.

i. Existing ECLGS 1.0 and 2.0 borrowers would be eligible for extra credit support of up to 10% of total credit outstanding as of 29.02.2020 or 31.03.2021, whichever comes first.

ii. Businesses that have not received help under the ECLGS (ECLGS 1.0 or 2.0) can receive credit support of up to 30% of their outstanding credit as of March 31, 2021.

iii. Businesses in ECLGS 3.0 sectors that have never used ECLGS before can get credit support up to 40% of their credit outstanding as of 31.03.2021, up to a limit of Rs.200 crore per borrower.

iv. Existing ECLGS borrowers who have enhanced their eligibility due to the change in the cut-off date from 29.02.2020 to 31.03.2021 can apply for incremental credit within these restrictions.

v. Borrowers who have received ECLGS help and whose credit outstanding as of 31.03.2021 (without ECLGS support) is larger than it was on 29.02.2020 will be eligible for additional support up to the ECLGS 1.0, 2.0, or 3.0 cap.

Businesses negatively impacted by the second wave of COVID 2019 will benefit from the new amendment, which will provide them with increased collateral-free liquidity. Furthermore, this gives much-needed assistance to all ECLGS borrowers (most of whom are MSME units) just in time for the busy / festival season.

National Credit Guarantee Trustee Company Limited is issuing amended operational guidelines in this regard separately (NCGTC).

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Government approves Rs. 4,400 crore investment in ECGC Ltd. in 5 years to provide support to exporters as well as banks

Government approves Rs. 4,400 crore investment in ECGC Ltd. in 5 years to provide support to exporters as well as banks

Under the leadership of Hon’ble Prime Minister Shri Narendra Modi, the government has taken a number of steps to enhance the export sector. In accordance with this, the government today approved a capital infusion of Rs 4,400 crore to ECGC Ltd. (previously known as Export Credit Guarantee Corporation of India Ltd.) for a five-year term, spanning FY 2021-2022 to FY 2025-2026. The approved infusion, combined with efforts to properly coordinate with ECGC’s listing process via the Initial Public Offering, would expand ECGC’s underwriting ability to support more exports.

The Government of India established the ECGC under the Companies Act in 1957 to promote exports by providing credit insurance services to exporters against nonpayment risks by overseas buyers due to commercial and political reasons. It also protects banks against risks associated with export credit lending to exporter borrowers. With its experience, expertise, and underlying commitment to the advancement of India’s exports, ECGC strives to support the Indian export industry.

The ECGC plays a broader role in promoting labor-intensive exports and encouraging bank lending to small exporter enterprises, resulting in their revitalization. The infusion of capital into ECGC will allow it to expand its coverage to export-oriented industries, particularly labor-intensive sectors. The approved amount will be infused in instalments, increasing the capacity to underwrite risks up to 88,000 crore, allowing ECGC to issue covers that can support an additional 5.28 lakh crore in exports over the five-year period, in line with the current pattern.

Furthermore, according to the World Bank and the International Labour Organization’s research “Export to Jobs,” 5.28 lakh crore in exports will result in the formalisation of 2.6 lakh workers. According to the research, the overall number of workers (both formal and informal) will rise by 59 lakhs.

Highlights of the ECGC’s performance

1. ECGC is the market leader in India’s export credit insurance business, with an estimated 85 percent market share.

2. In 2020-21, the ECGC assisted exports totaled Rs.6.02 lakh crore, or around 28% of India’s merchandise exports.

3. As of March 31, 2021, 7,372 and 9,535 separate exporters had benefited from Export Credit Insurance for Banks, with 97 percent of them being small exporters.

4. The ECGC guarantees around half of all bank export credit disbursements, with 22 banks covered (12 Public Sector Banks and 10 Private Sector Banks)

5. ECGC maintains a database of over 500,000 international buyers.

6. In the last decade, it has settled claims worth more than Rs.7,500 crore.

7. It has put $ 11.7 million into Africa Trade Insurance (ATI) to help Indian exports to the African market.

8. For the past 20 years, ECGC has maintained a consistent surplus and paid dividends to the government, covering 22 banks (12 Public Sector Banks and 10 Private Sector Banks)

Various Export-Related Schemes and Initiatives Launched by the Government in Recent Years

1. Due to the COVID-19 pandemic, the Foreign Trade Policy (2015-20) has been extended until September 30, 2021.

2. In September 2021, Rs 56,027 crore will be released to liquidate all pending arrears under all script-based Schemes in order to provide liquidity in the COVID-19 times.

3. Implementation of a New Scheme – Remission of Duties and Taxes on Exported Goods (RoDTEP). The Scheme has been allocated Rs 12,454 crore for the fiscal year 2021-22. It is a WTO-compliant mechanism for reimbursing taxes/duties/levies that are currently not refunded through any other mechanism at the central, state, and local levels.

4. The ROSCTL scheme, which has now been extended until March 2024, has increased support for the textiles sector by remission of Central/State taxes.

5. A Common Digital Platform for Certificates of Origin has been launched to facilitate trade and increase exporters’ use of FTAs.

6. A comprehensive “Agriculture Export Policy” is being implemented to boost agricultural exports in the agriculture, horticulture, animal husbandry, fisheries, and food processing sectors.

7. Promoting and diversifying services exports through the implementation of detailed action plans for each of the 12 Champion Services Sectors.

8. Districts are being promoted as export hubs by identifying items with export potential in each district, eliminating obstacles in exporting these products, and assisting local exporters/manufacturers in creating jobs in the area.

9. Indian missions abroad are now playing a more active role in promoting India’s trade, tourism, technological, and investment interests.

10. In light of the covid epidemic, a package was announced to boost domestic industry through different banking and financial sector relief measures, particularly for MSMEs, which account for a large share of exports.

11. To boost trade infrastructure and marketing, the Trade Infrastructure for Export Scheme (TIES), Market Access Initiatives (MAI) Scheme, and Transport and Marketing Assistance (TMA) Schemes have been established.

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ICSI Request for an extension of the deadline for submitting the DIR-3 KYC

ICSI Request for an extension of the deadline for submitting the DIR-3 KYC

The Institute of Company Secretaries of India made representation before Ministry of Corporate Affairs in regard of extending the due date or time limit for filing of DIR-3 KYC.

Extract of representation request as follows :

We’d like to draw your attention to Rule 12A of the Companies (Appointment and Qualification of Directors) Rules, 2018, which states that every individual who holds a Director Identification Number (DIN) as of the 31st March of a financial year as defined by these rules must submit an e-form DIR-3-KYC to the Central Government on or before September 30th of that year.

In light of the current situation, the time limit set forth in the Rule may be extended for another 30 days.

Professionals are also having technical difficulties filling out and filing the e-form DIR-3 KYC, according to reports. The OTPs created and given to the mobile number and e-mail ID of the pertinent directors must be filled in while filling out the DIR-3 KYC. The generated OTP is not being sent to non-resident and overseas directors’ registered cell phone numbers. The generated OTP is not always sent to the correct email addresses. The e-form DIR-3 KYC cannot be submitted without the use of OTPs.

We are hopeful that the aforementioned submission will be accepted.

To Read Official Request Representation Download PDF Given Below :

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Wednesday, September 29, 2021

Refund of wrongly reversed CENVAT credit cannot be rejected solely on the ground of non-filing of under protest letter

Refund of wrongly reversed CENVAT credit cannot be rejected solely on the ground of non-filing of under protest letter

In Prayosha Healthcare Pvt Ltd v. C.C.E. & S.T.-Vadodara-ii [Excise Appeal No. 11102 of 2018 dated September 21, 2021], the current appeal has been filed against Order-in- Appeal OIA-VAD-EXCUS-002-APP-613-2017-18 dated November 21, 2017 (“OIA”) passed by Commissioner (Appeals) of Central Excise, Customs and Service Tax- VADODARA-I (“Respondent”) for rejecting the appeal against Order-in-Original (“OIO”) which rejected the refund claim against reversal of Central Value Added Tax Credit (“CENVAT”) of Prayosha Healthcare Pvt Ltd (“the Appellant”).

The Appellant availed CENVAT Credit of Service Tax paid on sales commission to which the audit officers raised objections holding the same to not be admissible since sales commission is not an input service and the credit availed should be reversed. On the objection, the Appellant reversed the CENVAT Credit however filed a refund claim within a year from date of reversal on the ground that CENVAT credit is admissible on sales commission as per the ruling provided in the judgment M/s. Essar Steel India Ltd. v. C.C.E [2016-TIOL-520-CESTAT-AHM].

OIO– The OIO rejected the refund claim on the ground that sales commission is not input service and also on the ground that the Appellant had reversed the amount without under protest thereby, the Appellant agreed to the audit.

OIA– After filing of the appeal against OIO, the OIA also rejected the claim of the Appellant on the ground of non admissibility of sales commission as input services by referring to the definition of input service.

The Hon’ble CESTAT Ahmedabad on the current issue observed that even though the reversal was not made under protest, the Appellant has the right to claim refund within one year as per Section 11B of Central Excise Act,1944 (“the CE Act”). Noted, that the Appellant not filing the application under protest letter while reversing the credit refund cannot be rejected on this ground.

Further, noted that the matter as to whether sales commission is admissible as input service is subjudice before the Hon’ble Gujarat High Court in the case of M/s Essar Steel India Limited (supra), and Hon’ble Supreme Court in Cadila Healthcare Limited v. Commissioner of Central Excise, Surat-II [Appeal No: E/957/2012-DB], therefore the same cannot be decided on merits yet.

Held, the OIA is set aside and the appeal is allowed by way of remand to the Adjudicating Authority to pass a fresh order once the legal issue on admissibility of CENVAT Credit on sales commission is settled before the Hon’ble Supreme Court and Hon’ble Gujarat High Court.

DISCLAIMER: The views expressed are strictly of the author and A2Z Taxcorp LLP. The contents of this article are solely for informational purpose and for the reader’s personal non-commercial use. It does not constitute professional advice or recommendation of firm. Neither the author nor firm and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any information in this article nor for any actions taken in reliance thereon. Further, no portion of our article or newsletter should be used for any purpose(s) unless authorized in writing and we reserve a legal right for any infringement on usage of our article or newsletter without prior permission.

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SCN issued by DRI stayed for lack of authority under Customs Act

SCN issued by DRI stayed for lack of authority under Customs Act

In M/s. Aktel by Proprietorship Anand Kumar and Ors v. Union of India and Ors. [WPO No. 822 of 2021] the writ petition in the current matter has been filed by M/s. Aktel by Proprietorship Anand Kumar and Ors (“the Petitioners”) against Show Cause Notice dated April 13, 2020 (“SCN”) issued by the Directorate of Revenue Intelligence (“DRI”) under Section 124 read with Section 28 of the Customs Act, 1962 on the ground of lack of authority with the DRI to pass such SCN.

The Petitioners contend that the SCN issued by the DRI lacks the authority by relying on the case of M/s. Canon India Private Limited v. Commissioner of Customs [Civil Appeal No.1827 of 2018 dated March 09, 2021] wherein it was held that DRI has no authority to issue any SCN under Section 28 of the Customs Act, 1962 which provides for the powers of “Proper Officer” to issue notice for payment of duties, interest etc. in case of erroneous refund or short levy of interest on duty under the provisions of Customs Act, 1962.

In the case of M/S Canon India Private Limited (supra) the SCNs issued by the DRI were struck down for denying Basic Customs Duty (“BCD”) exemption on import of “Digital Still Image Video” cameras. By interpreting Section 28(4) the Customs Act, 1962, it was held that only a “Proper Officer” under the section can issue such a notice, thereby interpreting that the section provides the power only to the officer or his successor, who had originally been provided with the task of Assessment.

The Hon’ble Calcutta High Court noted that there appears to be a prima facie case by following the judgment of M/s. Canon India Private Limited (supra) wherein it was held DRI has no authority to issue such SCN and that such notice is non-est in law. Therefore, the stayed the SCN.

DISCLAIMER: The views expressed are strictly of the author and A2Z Taxcorp LLP. The contents of this article are solely for informational purpose and for the reader’s personal non-commercial use. It does not constitute professional advice or recommendation of firm. Neither the author nor firm and its affiliates accepts any liabilities for any loss or damage of any kind arising out of any information in this article nor for any actions taken in reliance thereon. Further, no portion of our article or newsletter should be used for any purpose(s) unless authorized in writing and we reserve a legal right for any infringement on usage of our article or newsletter without prior permission.

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Legitimate carry forward of ITC cannot be denied for non-filing of TRAN-1

Legitimate carry forward of ITC cannot be denied for non-filing of TRAN-1 – directed Department to permit filing of TRAN-1 till November 01, 2021

In M/s. Sunny Motors v. Central Board of Indirect Taxes and Customs (CBIC), Department of Revenue, Govt. of India and Others [W.P.(C) No.9348 of 2020 dated September 16, 2021], the current petition has been filed to direct the Department to accept the Goods and Services Tax (“GST”) TRAN-1 form under Rule 117 of the Central Goods and Services Tax Rules, 2017 (“CGST Rules”) and allow the Input Tax Credit (“ITC”) claimed by M/s. Sunny Motors (“the Petitioner”).

The Petitioner was unable to upload the GST TRAN-1 Form because of some “unavoidable and unforeseen circumstances” within the stipulated time, i.e., December 27, 2017. Due to which, a representation dated June 12, 2019 was made by the Petitioner praying that he be permitted to file the GST TRAN-1 Form manually pursuant to an Order W.P.(C) No.9269 of 2018 dated April 3, 2018 passed by the Hon’ble Orissa High Court. The Department vide a letter dated July 8, 2020 wrote to the Petitioner to submit his invoices in original along with proof of payment of Central Excise Duty to which the Petitioner replied that all documents had already been submitted and that TRAN-1 Form should be accepted. The Petitioner not having heard from the Department since has filed the current petition.

The Hon’ble Orissa High Court relied on the judgment of Aagman Services Private Limited v. Union of India [W.P. (C) No.1329 of 2019 dated November 21, 2019] which permitted the Petitioner in that case to submit his TRAN-1 Form either electronically or manually. Also relied on Adfert Technologies Pvt. Ltd. v. Union of India and others, [(2020) 73 GSTR 267] wherein it was observed that extension of date for submitting the declaration electronically on account of technical difficulties on the common portal is permissible under Rule 117(1A) of CGST Rules. The Adfert Technologies Judgment (supra) further provided “no body shall be denied to carry forward legitimate claim of ITC on the ground of non-filing of TRAN-1 by 27th December, 2017.”

Taking note and placing reliance on the above mentioned judgments, the court directed the Department to either open the portal to allow the Petitioner to file TRAN-1 Form electronically on or before November 1, 2021 or to accept the form from the Petitioner manually before that date.

(Author can be reached at info@a2ztaxcorp.com)

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Whether amount forfeited on account of breach of sale of land agreement taxable under GST

Whether amount forfeited on account of breach of sale of land agreement taxable under GST

In M/s. Fastrack Deal Comm Pvt. Ltd. [ADVANCE RULING NO. GUJ/GAAR/R/58/2020 dated July 30, 2020] M/s. Fastrack Deal Comm Pvt. Ltd. (“the Applicant”) after entering into a sale agreement to sell a factory land to a “Mr.B” for a consideration didn’t receive 80% of the value of consideration due to which has filed the current application seeking clarification of whether 20% the amount forfeited on account of breach of agreement of sale of land is liable to Goods and Services Tax (“GST”) or not.

The Applicant contended that 20% of the amount forfeited is on account of sale of land which is a transaction not liable to GST as per Schedule III of the Central Goods and Services Tax Act, 2017 (“the CGST Act”) which provides that sale of land is an activity or transaction, which is treated as, neither supply of goods nor service under GST.

The Hon’ble Gujarat Authority of Advance Ruling (“GAAR”) noted that the Applicant has not received the said amount on account of sale of land but received the same on account of non-fulfillment of conditions of agreement of purchase of factory land by the customer. The current case is covered under Clause 5(e) of Schedule-II of the CGST Act which provides “(e) agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act” to be construed as a taxable supply under Section 7(1) of the CGST Act.

Noted that the amount, which was received from Mr. B and forfeited by the Applicant, was a part of the terms and condition of an agreement. Mr.B also accepted that in the contingency of his inability to fulfill the transaction, the Applicant can exercise the option of forfeiting the amount received as an advance amount.

Further noted that the purpose of payment of amount is an act of tolerance implying that when there is breach of the contract, the Appellant is put to certain hardships, which he tolerates in return of the payment received as advance being forfeited. Therefore, the impugned transaction is a supply which is taxable under the CGST Act,.

Our Comments

Earlier (before the Central Goods and Services (Amendment) Act, 2018) the same was dealt under Section 7(1)(d) of the CGST Act which included activities referred to in Schedule II to CGST Act, in the scope of supply. Paragraph 5 of Schedule II to the CGST Act provides a list of activities to be treated as either as ‘supply of goods’ or ‘supply of services’ wherein inter alia comprised Para 5– “(e) agreeing to the obligation to refrain from an act, or to tolerate an act or situation, or to do an act”.

The Hon’ble Maharashtra AAR in the matter of Maharashtra State Power Generation Company Limited [Order No. GST-ARA- 15/2017-18/B-30, decided on May 8, 2018] held that GST at the rate of 18% would be payable on liquidated damages received by the Applicant for delayed supply under a contract and considered liquidated damages to be a consideration for agreeing to the obligation to tolerate an act or a situation, which is treated as a supply of service under Para 5(e) of Schedule II of the CGST Act.

Further, a similar view has been taken by the Hon’ble Gujarat AAR, in the matter of M/s. Dholera Industrial City Development Project Ltd. [Advance Ruling No. GUJ/GAAR/R/2019/06, decided on March 4, 2019] wherein it was held that Applicant is liable to collect GST on amount recovered from contractors on account of breach of conditions specified in the contract and the transaction shall be treated as supply of services. Moreover, as violation charges are payable by the contractors, the same are required to be treated as consideration. Therefore, the transaction is liable to GST.

However, vide Central Goods and Services (Amendment) Act, 2018, Section 7(1)(d) of the CGST Act was retrospectively omitted and a new sub-section i.e., Section 7(1A) of the CGST Act was inserted w.e.f. July 1, 2017. Consequently, all activities which were specified in Schedule II to the CGST Act would be only for determination of classification of transactions either as ‘supply of goods’ or supply of services’ but, it would be chargeable to GST only if such transaction qualify as a supply in terms of Section 7(1) of CGST Act.

In our view, the levy of GST on recovery of compensation/penalty/damages depends upon the “test of supply” i.e., one has to satisfy that recovery of compensation/penalty/damages in itself is a supply, then only GST could be levied on it in terms of the insertion of sub-clause (1A) in Section 7 of the CGST Act read with omission of sub-section (d) of Section 7(1) of the CGST Act (vide Central Goods and Services Tax (Amendment) Act, 2018 w.e.f. July 1, 2017).

The Schedule II of the CGST Act is confined to define as to what constitute supply of goods or supply of services and does not defines supply per se. Schedule II of the CGST Act has to be read along with Section 7 of the CGST Act, which means if an activity does not constitute a “supply” in itself as per Section 7(1) of the CGST Act, mere coverage of the same under the entry Schedule II ibid cannot make it liable to GST.

Further, there is no positive act of supply of services between the parties and there is no agreement between the parties to cause loss or damage by breaching terms and conditions of an agreement for a consideration. The expression ‘to tolerate an act’ relates to situations where a person commissions another person to do or commit a particular act for a consideration. The payment of damages is a condition of contract and not a consideration for any service in the nature of forbearance or tolerating an act.

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Regulatory Impact Assessment (RIA) for revision of existing Accounting Standards

Regulatory Impact Assessment (RIA) for revision of existing Accounting Standards

The Institute of Chartered Accountants of India (ICAI) has submitted an Approach Paper to the National Financial Reporting Authority (NFRA) in accordance with Rule 6 of the National Financial Reporting Authority Rules, 2018, for revision of existing accounting standards of companies that are not required to follow Indian accounting standards (Ind ASs). ICAI also submitted suggested texts for 18 revised Accounting Standards (ASs) out of a total of 32 revised ASs scheduled to be prescribed after the end of this AS revision project, together with the Approach Paper.

The majority of the companies to whom these proposed updated ASs will apply, according to the NFRA, are Private Limited Companies. Many of the businesses have a very low net worth, turnover, or debt, or a mix of these factors. Tiny families, perhaps with a small circle of friends and family, would typically own them. As a result, public interest in these companies’ General Purpose Financial Statements (GPFSs) is likely to be low. There are several Revised ASs that are very extensive and complex, and they may not be relevant or beneficial to the few users of these Companies’ GPFSs.

The expected standard audit cost to perform a reasonably good quality audit in accordance with the letter and spirit of the Standards on Auditing (SAs) is significantly higher than the currently reported audit fee ranges, with a large percentage of AS Companies reporting Payment to Auditors of less than $25,000.

Based on the foregoing findings, and convinced by the limited public interest in AS Companies’ GPFSs and the need to enable a regulatory environment conducive to their economic growth, NFRA has recommended to the ICAI that a Regulatory Impact Assessment of this revision proposal be conducted, which should include all of the standard features of such a process, and, in particular, to take action as follows:

a) The Approach Paper should be created in a transparent way following comprehensive national engagement with the major stakeholders, namely the Preparers – MSMCs (Micro, Small and Medium-Sized Companies) and Auditors – MSMPs (Micro, Small and Medium-Sized Professionals) (Micro, Small and Medium-size Practitioners). If the ICAI has conducted any previous public consultations on the Approach Paper, it is urged that it transmit the analysis of the public comments to the NFRA.

b) Comprehensive research and study should be conducted on the costs to Preparers of complying with these Revised ASs, as well as their technical resource capabilities, and these costs should be weighed against the potential advantages to all AS Company stakeholders.

c) The ICAI should rethink the Structure, Form, and Contents of Revised ASs for AS Companies and align them with the nature, size, and complexity of ASs, as well as their commercial demands, company size, ability to comply with prescribed standards, and relevance to their primary users.

The ICAI’s Approach Paper, as well as NFRA’s reaction to the ICAI Approach Paper, are available on the NFRA website at:

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Guidelines for Accepting Settlement Applications have been issued by the CBDT

Guidelines for Accepting Settlement Applications have been issued by the CBDT

To avoid genuine hardship to assessees, the Central Board of Direct Taxes (CBDT) has issued an order extending the period for admitting applications for settlement until September 30, 2021 (filed after January 31, 2021), and treating such applications as valid and processing them as “pending applications.”

In order to avoid genuine hardship to assessees, the Board, in exercising its power under clause (b) of sub-section (2) of section 119 of the Income-tax Act, 1961 (the Act), authorises the Commissioner of Income-tax, who is posted as Secretary to the Settlement Commission prior to February 1, 2021, to accept an application for settlement on behalf of the Interim Board filed after January 31, 2021, which is filed on behalf of the Interim Board.

The relaxation is available to assessees who were eligible to file an application for settlement on 31 January 2021 for the assessment years for which the application is sought to be filed (relevant assessment years); and where the assessee’s relevant assessment proceedings are pending as of the date of filing the application for settlement.

The Finance Act of 2021 revised the Act’s provisions, stating, among other things, that the Income-tax Settlement Commission (ITSC) will cease to exist on February 1, 2021. It has also been stipulated that no settlement application can be filed on or after February 1, 2021, the date on which the Finance Bill, 2021 was placed before the Lok Sabha. By notice No. 91 of 2021 dated 10/08/2021, the Central Government established an Interim Board for Settlement (Interim Board) to deal with the pending settlement applications as of 31/01/2021.

To Read Official Order Download PDF Given Below:

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NFRA to revisit the requirement of compulsory statutory audit for MSME

NFRA to revisit the requirement of compulsory statutory audit for MSME

India is unique among the big economies of the world in statutorily mandating compulsory audit for all companies, irrespective of their size and characteristics. In view of the significant role played by companies in India in the economic growth and development of the Nation, it is essential that the regulatory environment is conducive to support, and not burden, the growth in business and economic activities of these entities.

A preliminary analysis has been done by National Financial Reporting Authority (NFRA) on the key financial parameters of the companies registered in India from their MCA-21 filings and it is found that the fees paid to auditors by a large majority of Micro, Small and Medium Companies (MSMCs) are way below what an audit, when performed in compliance with the letter and spirit of the Standards of Auditing, would require.

Major economies of the world require statutory audit for small companies only in case some minimum criteria of public interest are satisfied. Even in India, income tax audit is now not compulsory where the turnover is Rs. 10 crore or less provided not more than 5% of the transactions are in cash. GST audit has also been completely done away with.

It is, therefore, appropriate to revisit the requirement of compulsory statutory audit for all companies irrespective of their size and/or public interest. NFRA has prepared a Consultation Paper explaining the issues involved and providing the data and information required for responding to the questions raised in an informed manner, with the objective to seek the comments/suggestions of the wider stakeholder group and the public at large on questions raised. The last date for receipt of comments is 10th November, 2021. The comments may be submitted by email at: comments-tac.paper@nfra.gov.in

NFRA’s Consultation Paper on Statutory Audit and Auditing Standards for Micro, Small and Medium Companies (MSMCs) can be accessed on NFRA’s website at below mentioned Link:

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SEBI: Electronic Gold Receipt to have Trading, clearing and settlement features akin to any Other ‘Securities’

SEBI: Electronic Gold Receipt to have Trading, clearing and settlement features akin to any Other ‘Securities’

The framework for the Gold Exchange and SEBI (Vault Managers) Regulations, 2021 has been approved by the Securities and Exchange Board of India (SEBI).

The gold-representing instrument will be known as a ‘Electronic Gold Receipt’ (EGR), and it will be classified as “securities” under the Securities Contracts (Regulation) Act of 1956. EGRs will have the same trading, clearing, and settlement features as other “securities.”

According to the press release, any recognised stock exchange, both existing and new, can begin trading in EGRs in a separate segment. The recognised stock exchanges, with the approval of SEBI, can determine the denomination for trading EGR and converting EGR into gold. The Clearing Corporation will settle stock exchange trades by transferring EGRs and funds to the buyer and seller, respectively. Because EGRs have perpetual validity, the EGR holder can keep the EGR for as long as they want. Upon surrender of the EGRs, the EGR holder may also withdraw the underlying gold from the vaults at his discretion. To reduce the costs of withdrawing gold from vaults, EGRs will be made “fungible,” and “inter-operability between Vault Managers” will be permitted.

The Vault Manager shall be a body corporate incorporated in India, according to the SEBI (Vault Managers) Regulations, 2021. A net worth of at least Rs. 50 crores is required for the Vault Manager. For the purpose of providing vaulting services for gold deposited to establish EGRs, the Vault Manager will be registered and regulated as a SEBI intermediary. Accepting deposits, storing and safeguarding gold, generating EGR, withdrawing gold, resolving grievances, and reconciling physical gold with the depository’s records will be among the responsibilities of the Vault Manager.

“The Gold Exchange, which encompasses the complete ecology of EGR trading and physical gold delivery, is projected to generate a thriving gold ecosystem in India, comparable with India’s considerable proportion of world gold demand. The Gold Exchange would be a national forum in India for buying and selling EGRs with underlying standardised gold, as well as establishing a national gold price framework. The Gold Exchange is intended to provide a slew of benefits to value chain participants as well as the broader gold market ecosystem, including efficient and transparent price discovery, investment liquidity, and assurance of gold quality, among other things, according to the SEBI.

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Thursday, September 30, 2021

The types of persons mentioned under the sections are define as below:

STRUCTURE OF THE NEW INCOME TAX PORTAL

BENIFITS OF NEW INCOME TAX FILING PORTAL

Job Responsibilities

Requirement

Location

WHAT IS E-INVOICING?

WHICH ALL BUSINESSES ARE REQUIRED TO GENERATE E-INVOICING?

Description

Duties & Responsibilities:

Selection Criteria

Wednesday, September 29, 2021

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