Reference: Central Board of Direct Taxes
Update:
Income Tax Department creates Exchange of Information Portal for dissemination of information to all stakeholders:
The tax department has launched a portal that will provide information, including about procedures, related to automatic exchange of information under common reporting standard. Central Board of Direct Taxes (CBDT) Chairman P C Mody inaugurated the web portal on Income Tax website.
India is committed to exchange financial account information automatically from 2017 under the Common Reporting Standard (CRS) on AEOI, the CBDT said in a release.
Information is reported annually by financial institutions which are then exchanged by India under the standard.
The web portal will be a repository of policy and technical circulars, guidance and notifications issued by the CBDT, and provide links to relevant circulars and guidance issued by the regulatory authorities and other international bodies.
Implication:
The portal would not only be useful for the domestic financial institutions but will also help the foreign tax authorities and financial institutions to get information about the Indian laws, rules and procedures related to AEOI under CRS.
Update:
Taxation Laws (Amendment) Bill, 2019:
The Union Cabinet has approved the proposal for introducing the Taxation Laws (Amendment) Bill, 2019. The Bill replaces the Ordinance that was promulgated in September 2019. The Ordinance made certain amendments in the Income-Tax (IT) Act 1961 and the Finance (No.2) Act 2019.
Salient features of the amendments are as follows:
In order to promote growth and investment, a new provision was inserted in the IT Act to provide that with effect from the current financial year 2019-20, an existing domestic company may opt to pay tax at 22% plus surcharge at 10% and cess at 4%, if it does not claim any incentive/deduction. The effective tax rate for these companies comes to 25.17% for these companies. They would also not be subjected to Minimum Alternate Tax (MAT).
In order to attract fresh investment in manufacturing and provide boost to \’Make-in India\’ initiative of the Government, another provision was inserted to the IT Act, to provide that a domestic manufacturing company set up on or after 1st October, 2019 and which commences manufacturing by 31st March, 2023, may opt to pay tax at 15% plus surcharge at 10% and cess at 4% if it does not claim any incentive/deduction. The effective rate of tax comes to 17.16% for these companies. They would also not be subjected to MAT.
Implication:
The Ordinance was promulgated to amend the Income Tax Act, 1961, and the Finance (No. 2) Act, 2019 to provide domestic companies with an option to opt for lower tax rates in September 2019.
Reference: Central Board of Indirect Taxes and Customs
Update:
Clarification:
CBIC vide Circular No. 126/45/2019-GST, dated November 22, 2019 has clarified that manufacturing services carried out on physical inputs (goods) which are owned by unregistered persons shall be taxable at rate of 18% GST.
Implication:
18% GST leviable on manufacturing services on goods belonging to unregistered persons.
Update:
Insertation of explanation regarding Bus Body Building in Notification No. 8/2017-Integrated Tax (Rate) dt. 28.06.2017.:
CBIC has broadened the scope of term ‘Bus body building’ by inserting an Explanation for the ‘services by way of job work in relation to bus body building’. As per the said Explanation ‘bus body building’ will include building of body on chassis of any vehicle falling under Chapter 87 of the Customs Tariff Act, 1975.
Implication:
Scope of term ‘Bus body building’ broadened in respect of its related ‘job work services’.
Reference: Reserve Bank of India
Update:
Scope of SNRR Account expanded:
RBI has expanded the scope of Special No-Resident Rupee Accounts by permitting non-resident to open such accounts for rupee denominated overseas borrowings, trade credi and trade invoiving for popularising cross-border transactions in the domestic currency.
Further restriction on the tenure of SNRR account, which is currently Seven Years has also been removed. READ MORE
Implication:
This will popularized the cross boared transactions in India Rupee.
Reference: Securities and Exchange board of India
Update:
Sebi invites applications from agencies to process, maintain investor complaints
SEBI is preparing to add an agency to handle and process the details of investor complaints. The agency will have to receive and categorize complaints from investors either physically or electronically.
In addition, the agency will have to monitor the status of complaints online. It will also have the responsibility to prepare an Action Report (ATR) and update the status of complaints on scores. Scores is Sebi\’s online complaint platform.
The regulator said in a notice that the Securities and Regulatory Board of India (SEBI) has invited applications in the prescribed format from agencies for handling and processing investor grievances. The agency will send complaints to the units and companies and will also inform the investors via e-mail. Agencies interested in this work can apply to SEBI by December 3.
Implication:
The income of the interested party should be at least Rs 50 lakh per annum during the last three years and should not be in loss for two consecutive years in the last five years.
Update:
SEBI barred Karvy Stock Broking Ltd. from taking on new clients after finding alleged client fraud of ₹2,000 crore:
Sebi stated that the firm misused client collateral for its own trades. As per Sebi’s intermediary regulations, brokerage firms cannot create additional pledges on clients’ securities. Even if the client securities were pledged, it should be (used) only for meeting the obligation of the respective clients
In an effort to prevent further misuse of clients securities, Sebi, as an interim measure, barred Karvy from taking any more clients in respect of its stock broking business till the regulator completes its investigations. Karvy was also been barred from acting on behalf of its clients.
Implication:
Sebi has initiated a forensic audit to establish the extent of alleged misuse of client pledges, and directed exchanges and depositories to initiate disciplinary proceedings against the brokerage firm.
Update:
Monetary penalty on Green venture Securities Management Private Limited:
SEBI has imposed a penalty of Rs. 10,50,000 on Green Venture Securities Management Private Limited for creation of artificial trading volumes by trading between two counterparties thus violating the provisions of SEBI (Prohibition of Fraudulent and Unfair Trading Practices related to Securities Markets) Regulations, 2003
Implication:
The entity shall pay the amount mentioned in order within a period of 45 days from the date of service of this order.
Reference: General
Update:
NCLT directs that MCA be made a party in all IBC cases and Company Petitions:
The National Company Law Tribunal, Principal Bench has directed that Secretary, Ministry of Corporate Affairs, Government of India shall be made a party to all the cases under the Insolvency & Bankruptcy Code as well as the Company petitions before the Tribunals.
The direction is applicable not only to the Principal Bench at New Delhi but all the Benches of the National Company Law Tribunal in India.
The Deputy Registrars of all National Company Law Tribunals have been directed to ensure that the order is complied with.
Implication:
Making the Ministry of Corporate Affairs as a party would facilitate the availability of authentic record for the proper appreciation of the matters being contested before it.
Update:
Incorrect Data in certain lECs – corrective action required from exporters:
On analysis of the DGFT IEC database, it has been observed that there are certain data mismatch issues which require immediate corrective action. Following two broad categories of data mismatch in IECs (Import Export Code number) have been reported:
i. Incorrect Permanent Account Number (PAN)
ii. More than one IEC against same PAN
Implication:
IEC holders as mentioned in the Trade Notice are requested to take immediate steps to correct their IEC data before 15 December 2019, failing which these lECs will be suspended by the jurisdictional DGFT Regional Authority (RA).
