Reference: Central Board of Direct Taxes
Update:
Income tax (4th Amendment) Rules, 2020
In the Income-tax Rules, 1962 (hereinafter referred to as the principal rules), after rule 21AD, the following rules shall be inserted, namely:-
21AE. Exercise of option under sub-section (5) of section 115BAA:
- The option to be exercised in accordance with the provisions of sub-section (5) of section 115BAA by a person, being a domestic company, for any previous year relevant to the assessment year beginning on or after the 1st day of April, 2020, shall be in Form No. 10-IC.
- The option in Form No. 10-IC shall be furnished electronically either under digital signature or electronic verification code.
- The Principal Director General of Income-tax or the Director General of Income-tax, shall-
- specify the procedure for filing of Form No. 10-IC;
- specify the data structure, standards and manner of generation of electronic verification code, referred to in sub-rule (2), for verification of the person furnishing the said Form; and (iii) be responsible for formulating and implementing appropriate security, archival and retrieval policies in relation to the Form so furnished.
21AF. Exercise of option under sub-section (7) of section 115BAB:
- The option to be exercised in accordance with the provisions of sub-section (7) of section 115BAB by a person, being a domestic company, for any previous year relevant to the assessment year beginning on or after the 1st day of April, 2020, shall be in Form No. 10-ID.
- The option in Form No. 10-ID shall be furnished electronically either under digital signature or electronic verification code.
- The Principal Director General of Income-tax (Systems) or the Director General of Income-tax (Systems), as the case may be, shall-
- specify the procedure for filing of Form No. 10-ID;
- specify the data structure, standards and manner of generation of electronic verification code, referred to in sub-rule (2), for verification of the person furnishing the said Form; and
- be responsible for formulating and implementing appropriate security, archival and retrieval policies in relation to the Form so furnished.
Implication:
The provisions may come into force on the 1st day of April, 2020.
Update:
Income tax (5th Amendment) Rules, 2020
Government has prescribed following manner of making permanent account number inoperative
- Where a person, who has been allotted the permanent account number as on the 1st day of July, 2017 and is required to intimate his Aadhaar number under sub-section (2) of section 139AA, has failed to intimate the same on or before the 31st day of March.
- Where a person, whose permanent account number has become inoperative under sub-rule (1), is required to furnish, intimate or quote his permanent account number under the Act, it shall be deemed that he has not furnished, intimated or quoted the permanent account number and he shall be liable for all the consequences under the Act.
- Where the person referred to in sub-rule (1) has intimated his Aadhaar number under sub-section (2) of section 139AA after the 31st day of March, 2020, his permanent account number shall become operative from the date of intimation of Aadhaar number
- The Principal Director General of Income-tax or Director General of Income-tax shall specify the formats and standards along with the procedure for verifying the operational status of PAN.
Implication:
The provisions shall come into force from the date of their publication in the Official Gazette.
Update:
CBDT notifies the Rules to make PAN inoperative if it is not linked with Aadhaar
CBDT has notified Rule 114AAA to provide that where PAN of a person become inoperative, it shall be deemed that he has not furnished, intimated or quoted his PAN. Consequently, he shall be liable for all the consequences for not furnishing, intimating or quoting the PAN.
Implication:
The last date of linking PAN with Aadhaar is 31-03-2020.
Update:
CBDT introduces instant allotment of PAN on basis of Aadhaar
The Income-tax Department has introduced a functionality for instant allotment of PAN on basis of Aadhaar without any requirement for filling up of detailed application form. Further, a person shall not be required to pay any charges for using this facility of Aadhaar based instant PAN.
Update:
CBDT notifies forms to excercise option under new regime of section 115BAA and 115BAB
The Taxation Laws (Amendment) Act, 2019, introduced two new sections i.e. section 115BAA and section 115BAB. These section allows a domestic company to pay taxes at concessional rate of 22% or 15%, subject to fulfilment of certain conditions. The company opting of new taxation regime prescribed under Section 115BAA is required to exercise such option by filing a Form 10-IC. Similarly, a company opting for Section 115BAB is required to exercise such option by filing a form 10-ID.
Implication:
These forms are required to be furnished electronically either under digital signature or Electronic Verification Code (EVC).
Update:
Partners\’ remuneration / interest allowable to Firm opting for presumptive taxation u/s. 44AD
Delhi ITAT rules that interest on capital and remuneration to partners should be allowed as deduction to assessee-firm opting for presumptive taxation u/s. 44AD, where maintainence of books is not required.
Update:
Some component of Salary income may be taxed twice
The Finance Bill, 2020 has proposed to amend section 17(2)(vii) of the Income-tax Act by introducing a cap on maximum contribution an employer can make towards recognized provident fund (PF), National pension scheme (NPS) and Superannuation fund (hereinafter collectively referred to as \’employee welfare schemes\’). This will lead to absurd taxability in the hands of an employee because as per section 17(1), the full amount of contribution made by the employer to NPS is already taxable in the hands of the employee.
Implication:
The proposed clause provides that contribution to employee welfare schemes in excess of Rs. 750,000 shall be taxed as perquisite in the hands of the employee.Employees with high salary income can escape from the tax liability only when their employer contribute the substantial amount in recognized provident fund and that too within the limit of 12% of salary.
Reference: Central Board of Indirect Taxes & Customs
Update:
Exemption of duties of Central Excise against scrips
CBIC exempts the goods specified in the Fourth Schedule to the Central Excise Act, 1944. Provided that the said scrip, against which goods specified in the Fourth Schedule to the said Act when cleared are exempted from the whole of duty of excise leviable thereon under the Fourth Schedule to the said Central Excise Act, may include duty credit provided under the Additional Ad Hoc Incentive. The exemption shall be subject to the certain conditions:
- That the conditions (1) to (3) specified in paragraph 2 of the notification of Government of India, Ministry of Finance, Department of Revenue, No. 13/2020-Customs, dated 14th February, 2020 are complied and the said scrip has been registered with the Customs Authority at the port of registration specified on the said scrip.
- Holder of the scrip will present the said scrip to the said Customs Authority along with a letter or proforma invoice from the supplier or manufacturer indicating details of its jurisdictional Central Excise Officer and the description, quantity, value of the goods to be cleared and the duties leviable thereon.
- The said Customs Authority shall debit the duties leviable, but for this exemption in or on the reverse of the said scrip and shall mention the necessary details thereon, update its own records and send written advice of these actions to the said Officer.
Update:
Exemption of duties of Central Excise against scrips issued under the 2% Additional ad hoc incentive for mobile phones
Central Government vide amendment in its notification stated that the said scrip, against which goods when cleared are exempted from the whole of duty of excise leviable thereon under the Fourth Schedule to the said Central Excise Act, may include duty credit provided under the 2% Additional Ad Hoc Incentive in terms of paragraph 3.25 of the Foreign Trade Policy.
Reference : Institute of Chartered Accountants of India
Update:
ICAI\’s decision regarding cut-off date for condonation of cases for the year 2020-21
The Council has decided to extend the due date of submission of all forms up to 29th February, 2020 and waive all condonation fees for a further period of 29 days up i.e to 29th February, 2020 as one time measure.
Reference: Ministry of Corporate Affairs
Update;
Nidhi (Second Amendment) Rules, 2020
MCA has vide Nidhi (Second Amendment) Rule 2020 extended the timeline for compliance to be followed by Every company referred to in clause (b) of rule 2 and every Nidhi incorporated under the Act, before the commencement of Nidhi (Amendment) Rules, 2019. As per the said amendment above referred company shall get itself declared as such in accordance with rule 3,4 within a period of one year from the date of its incorporation or within a period of nine months from the date of commencement of Nidhi (Amendment) Rules, 2019, whichever is later.
Implication:
Above referred companies will have more time to comply with the said rule.
Reference: Securities and Exchange board of India
Update:
SEBI constitutes ‘Municipal Bonds Development Committee’
SEBI has constituted a Municipal Bonds Development Committee, comprising of representatives from ministry, municipal corporation, lawyers, professionals and market practitioners as members. The terms of reference of the committee would be as under:
- To advise SEBI on issues related to regulation and development of primary and secondary market of municipal debt securities.
- To advise SEBI on matters required to be taken up for changes in legal framework to introduce simplification and transparency in systems and procedures in the primary and secondary market.
- To advise SEBI on matters relating to regulation of intermediaries for ensuring investor protection in the primary and secondary market.
- To recommend SEBI on measures to facilitate issuers (i.e. municipalities) for issuance of municipal debt securities.
Update:
Monetary penalty on Redmond Investments Limited:
Redmond Investments Limited failed to make disclosures to BSE and YDL under regulation 13(4A) within two working days and therefore, violated regulation 13(4A) r/w regulation 13(5) of SEBI (PIT) Regulations, 1992 and has failed to make required disclosures under section 15A(b) of SEBI Act, 1992.
Hence, SEBI has imposed a penalty of Rs 9,00,000/- upon the Noticee, i.e. Redmond Investments Limited for violation of regulations 13(4A) r/w 13(5) of PIT Regulations, 1992.
Implication:
The Noticee shall remit / pay the said amount of penalty within 45 days of receipt of this order.
Update:
Monetary penalty on Arihant Sharecom Private Limited
Arihant Sharecom Private Limited has indulged in fraudulent and unfair trade practices. It had executed a total of 67 such trades in 19 unique contracts which allegedly led to creation of artificial volume of total 58,66,000 units. It is further observed that the Noticee, by executing non genuine trades during the relevant period, registered a positive close out difference of ₹2,30,92,225/- approx
Hence, SEBI imposed a monetary penalty of ₹5,00,000/- upon Noticee viz. Arihant Sharecom Private Limited for trading in fraudulent manner.
Implication:
The Noticee shall remit / pay the said amount of penalty within 45 days of receipt of this order.
Update:
Penalty on HBJ Capital Services Pvt. Ltd. and its Directors for non compliance of WTM order:
Whole time Member(WTM) of SEBI had passed an interim order dated June 15, 2015, in respect of HBJ Capital Services Private Limited and its Directors for violating certain provisions, namely:-
- To cease and desist from acting as an Investment Adviser and Alternative Investment Fund and to cease to solicit or undertake such activities or any other unregistered activities in the securities market directly or indirectly.
- To immediately withdraw and remove all advertisements, representations, Literatures, brochures, materials, publication, documents, websites, etc. in relation to those schemes/ activities (investment adviser and Alternative Investment Fund) or any unregistered activities in the securities market.
- Not to divert any funds raised from investors, kept in bank account(s) and/ or in the custody of HBJ Capital or its directors and HBJ Capital LLP and its designated partners. As per the SCN, it is alleged that the Noticees failed to comply with the directions issued vide WTM order dated June 15, 2015.
The notice has failed to comply with the WTM order. Hence, SEBI has imposed a penalty of Rs. 25,00,000/- on the Noticees for non-compliance of WTM order dated June 15, 2015.
Implication:
The Noticees shall jointly and severally remit / pay the said amount of penalty within 45 days of receipt of this order.
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