27 June 2013

Standardizing the process of filing application under section 10(46)

Ministry of Finance, Central Board of Direct Tax issued [Notification no. F.NO. 196/6/2013- ITA.1 by dated 24-06-2013], regarding standardizing the process of filing application under section 10(46) of the Income Tax Act, 1961.

Remuneration for branch audit work of the bank

Remuneration for branch audit work of the bank. Category of bank branch on the basis of quantum of advances. Rates of audit fees:-
Up to 10 crore-Rs. 40,250/-
Above 10 crore up to 20 crore- Rs. 57,500/-
Above 20 crore up to 30 crore- Rs. 79,350/-
Above 30 crore up to 50 crore- Rs. 1,20,750/-
Above 50 crore up to 75 crore- Rs. 1,38,000/-.

26 June 2013

The soft ITR 5 for the assessment

The soft ITR 5 for the assessment year 2013-14 is now available at Income Tax department website.

RBI has increased the bank audit fees

RBI has increased the bank audit fees payable form financial year 2012-13 as per [RBI Notification no. DBS.ARS.No.BC. 08/ 08.92.001/ 2012-13 dated 25-06- 2013].

Lower Deduction Certificate

Lower Deduction Certificate to a unit enough to cover other units of assessee even if separate TANs. [CIT Chandigarh Vs Parle Biscuits. High Court of Punjab & Haryana].

Right to collect toll is an intangible asset

Right to collect toll is an intangible asset within the purview of sec. 32(1)(ii) of the Income Tax Act and is eligible for depreciation. [ACIT Vs. Ashoka Infraways (P.) Limited, 2013] 33 taxmann.com 499 (Pune - Tribunal)].

25 June 2013

demerger abundant

Resultant Company can file appeal after demerger abundant caution appeal by demerged Company dismissed to avoid duplicity. [Cairn Energy Gujarat BV Vs. ADIT [2013] 34 taxmann.com 281 (Ahmedabad - Tribunal)]

No violation of Sec 269SS

No violation of Sec 269SS for cash loan from relative if assessee unable to get it in cheque or DD for some valid reason. [CIT-I Vs M.Yesodha, Chennai High Court].

Stridhan of a lady

Stridhan of a lady seized from her ex-husband’s premises during search of Income Tax must be handed over to her. [High Court Of Gujarat at Ahmedabad Renuka R Modi].

24 June 2013

Commodity Transaction Tax

Chapter VII of Finance Act, 2013 on Commodity Transaction Tax effective from July 1, 2013
SECTION 115 OF THE FINANCE ACT, 2013 - COMMODITIES TRANSACTION TAX – NOTIFIED DATE FOR ENFORCEMENT OF CHAPTER VII OF FINANCE ACT, 2013
NOTIFICATION NO. 45/2013 [F.NO.142/09/2013-TPL]/SO 1768(E), DATED 19-6-2013
In exercise of the powers conferred by sub-section (2) of section 115 of the Finance Act, 2013 (17 of 2013), the Central Government hereby appoints the 1st day of July, 2013 as the date on which Chapter VII of the said Act shall come into force.

Valuation loss is allowable

Valuation loss is allowable even if stock-in-trade shown as investment in compliance of RBI guidelines. [Karnataka Bank Ltd. Vs. ACIT [2013] 34 taxmann.com 150 (Karnataka).]

22 June 2013

Addition on the basis of seized material

Addition on the basis of seized material was unjustified if assessee was able to show that the admissions made during survey were incorrect. [Acit V. Maya Trading Co.( 2013) 34 taxmann.com 144 (Agra – Trib)].

20 June 2013

No disallowance of expenditure u/s. 40(a)(ia)

No disallowance of expenditure u/s. 40(a)(ia) for default of short-deduction of TDS under Income Tax Act.[Income Tax Appellate Tribunal Mumbai].

17 June 2013

Rejection of Books of account

  • Mere rejection of Books of account and estimation of profit cannot be ground for concealment penalty under Income Tax Act. [High Court of Gujarat Whitelene Chemicals].

15 June 2013

SC on S. 194C TDS does not apply to contract manufacturing agreements


CIT vs. Silver Oak Laboratories P. Ltd (Supreme Court)

S. 194C TDS does not apply to contract manufacturing agreements
 The assessee, a manufacturer of pharmaceutical products, entered into agreements with various manufacturers who manufactured the said items according to the specifications provided by the assessee. The AO held that the transaction between the assessee and the manufacturer was in the nature of a "works contract" and fell within the purview of s. 194C and that the assessee ought to have deducted TDS thereon. The assessee was held to be in default and liable to pay the tax and interest u/s 201(1) & 201(1A). On appeal by the assessee, the Tribunal held that the transaction was one of sale simplicitor and was not in the nature of a work contract and that the assessee was not liable to deduct TDS u/s 194C. The department's appeal to the High Court was dismissed by following Reebok India 306 ITR 124 (Del). On appeal by the department to the Supreme Court, HELD dismissing the SLP:
 On examining the terms and conditions, invoices, purchase orders and challans indicating payment of excise duty, there is no material on record to indicate that the transaction in question is a "contract for carrying out works". Hence, s. 194C is not attracted. S. 194C has been amended by the Finance (No.2) Act, 2009, w.e.f. 1.10.2009 to provide that "work" includes manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from such customer. It is clarified that the definition of the word "work" will not include manufacturing or supplying a product according to the requirement or specification of a customer by using material purchased from a person other than such customer.
 This impliedly approves the view taken in Glenmark Pharmaceuticals 324 ITR 199 (Bom)

Double taxation agreement with Monaco

Double taxation agreement with Monaco [Notification no. 43/2013 dated 12/06/2013 SO 924(E)].

Conversion of company into LLP

On conversion of company into LLP, Auditor of the company deemed to be auditor of LLP. [Circular of Ministry of Corporate Affairs].

E-filing of form 3CEB

E-filing of form 3CEB for specified domestic transactions mandatory besides for foreign transactions. [New Rules and Revised Form. Income Tax 6th Amendment Rules, 2013] .

13 June 2013

Statement of the assessee in survey operations

Statement of the assessee in survey operations not conclusive piece of evidence under Section 133A of the Income Tax Act. [CIT Vs P. Bala Subramanian, 2013, 354ITR 116 (Madras)].

Periodic legal audit and reverification of title deeds

Periodic legal audit and reverification of title deeds by banks for credit exposures of 5 crore and above till the loan stands fully repaid.[ RBI Circular of 07-06-2013].

Penalty u/s 271 (1)(c)

Penalty u/s 271 (1)(c) of the Income Tax Act cannot be levied in respect of an addition made u/s 50C.[Commissioner of Income Tax Vs Madan Theatres Limited (Calcutta High Court)].

ITR- IV Soft form no. 4

ITR- IV Soft form no. 4 for the assessment year 2013-14 is now available on Income Tax Site.

12 June 2013

Home loan prepayment fee

Home loan prepayment fee/foreclosure charges are eligible for deduction under head Income from house property. [Case of Windermere Properties, ITAT Mumbai].

11 June 2013

Income Tax Return for assessment year 2013-14

Central Board of Direct Taxes notifies Income Tax Return for assessment year 2013-14 (Financial year 2012-13), IncomeTax (Third Amendment) Rules, 2013 – Amendment in Rule 12 and substitution of Forms Sahaj (ITR-1), ITR-2, ITR-3, Sugam (ITR-4S), ITR-4 and ITR-V notification no, 34/2013 [F.NO.142/5/2013-TPL]/SO 1111(E), dated 01-05-2013.

Concurrent audit for Central Bank

Concurrent audit for Central Bank link to apply online ishttp://119.82.71.21/caudit/con_audit_details.aspx or visit website of Central Bankwww.centralbankofindia.co.in. Last date to apply is 13/06/2013.

07 June 2013

Cost Inflation Index-2013-14- 939

SECTION 48, EXPLANATION (v) OF THE INCOME-TAX ACT, 1961 - CAPITAL GAINS - COMPUTATION OF - NOTIFIED COST INFLATION INDEX FOR FINANCIAL YEAR 2013-14
NOTIFICATION NO. 40/2013 [F. NO. 142/7/2013-TPL]/SO 1464(E), DATED 6-6-2013
In exercise of the powers conferred by clause (v) of the Explanation to section 48 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby makes the following amendment in the notification of the Government of India in the Ministry of Finance (Department of Revenue), Central Board of Direct Taxes, published in the Gazette of India, number S.O. 709 (E), dated the 20th August, 1998, namely:—
In the said notification, in the Table, after serial number 32 and the entries relating thereto, the following serial number and entries shall be inserted, namely :-
Sl. No.Financial YearCost Inflation Index
(1)(2)(3)
"332013-14939"

06 June 2013

Transfer pricing law



Transfer pricing law not applies to share investment transactions under Income Tax Act. In the Income Tax Appellate Tribunal Hyderabad Bench M/s Vijai Electricals Limited.

TDS on Poperty

Buyer of property to download and issue to seller, TDS certificate in form 16B in 15 days from due date of deposit of TDS. (22 days from end of month of Sale).

05 June 2013

E-payment of TDS

E-payment of TDS on sale of property in challan cum statement in Form 26QB in 7 days from end of month in which deduction made. Income Tax 5th Amendment Rules, 31-05-2013.

TDS on immovable proprty

The Finance Act, 2013 had provided that purchaser of an immovable property (other than agricultural land) worth over Rs 50 lacs is required to pay withholding tax at the rate of 1% from the consideration payable to a resident transferor. The rate at which tax is to be cut is 1%, but it would go up to as high as 20% if the seller does not disclose his permanent account number. This amendment is effective from 01-06- 2013.

03 June 2013

No penalty for mere change in head

No penalty for mere change in head of income under Income Tax Act. [ITAT Bench, Ahmedabad, M/s.Crown Tradelink Pvt. Ltd].
Acknowledgement to be given by banks to their customers at the time of submission of Form 15G/15H. [RBI Notification of 31-05-2013].

Canara Bank empanelment

Canara Bank invites applications from the eligible/interested Individuals / Firms / Companies for empanelment as concurrent auditors for conducting concurrent audit in the identified 615 branches / units for the period from 01.07.2013 to 30.06.2014.

01 June 2013

Form 15 G Ack by Banks


Date: May 31, 2013
Acknowledgement by banks at the time of submission of Form 15-G / 15-H
RBI/2012-13/516
DBOD.No.Leg.BC.100/09.07.005/2012-13
May 31, 2013
All Scheduled Commercial Banks
(excluding RRBs)
Dear Sir/Madam,
Acknowledgement by banks at the time of submission of Form 15-G / 15-H
As you are aware banks are not required to deduct TDS from depositors who submit declaration in Form 15-G/15-H under Income Tax Rules, 1962. However, it has been brought to our notice that despite submission of Form 15-G/15-H by customers, banks are deducting tax at source, at times, causing inconvenience to customers resulting in a number of complaints.  Such instances arise because either the forms are misplaced or a track is not kept of forms received in the branches.
2. The matter has been examined by us in consultation with Indian Banks' Association (IBA). With a view to protect interest of the depositors and for rendering better customer service, banks are advised to give an acknowledgment at the time of receipt of Form 15-G/15-H. This will help in building a system of accountability and customers will not be put to inconvenience due to any omission on part of the banks.
Yours faithfully,
(Rajesh Verma)
Chief General Manager
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MCA Circular on Declaration


Circular No: 11/2013
File No. 17/118/2012 CL V
Government of India
Ministry of Corporate Affairs
5th Floor, Shastri Bhawan
Rajendra Prasad Road
New Delhi – 110001
Dated: 29th May, 2013
To
All Regional Directors
All Registrar of Companies
Sub: Power of ROCs to obtain declaration/ affidavits from subscribers/first directors at the time of incorporation.
Sir,
The matter of protection of interest of investors, including depositors, is very important to ensure healthy corporate capital market environment in the country. The recent instances of raising of monies by companies in a manner which is opaque/convoluted, non-accountable and which does not protect interests of depositors have been taken note of by the Ministry seriously.
Keeping in view the need to protect the interest of investors and ensure that companies raise monies in accordance with the provisions of the Companies Act/Deposit Rules, it is clarified that in exercise of the powers under the Companies Act, the Registrar of Companies may obtain declaration/affidavits from subscribers/first directors first at the time of incorporation and from directors, subsequently whenever company changes its objects, to the effect that company/directors shall not accept deposits unless compliance with the applicable provisions ofCompanies Act, 1956, RBI Act, 1934 and SEBI Act, 1992 and rules/directions/regulations made there under are duly complied and filed with the concerned authorities.
Yours faithfully
(Sanjay Shorey)
Joint Director
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I

Section 2(22)(e) not applies to amount advanced for investment

Section 2(22)(e) not applies to amount advanced for investment on behalf of company under Income tax act. [ITAT DELHI BENCH Adarsh Kapoor]

No penalty merely because claim of the assessee was disallowed

No penalty merely because claim of the assessee was disallowed u/s.40(a)(ia) under Income tax act. [ITAT MUMBAI Tanushree Basu]

Five Days Residential Programme on Advanced Leadership for Chartered Accountants at IIM Ahmedabad

ICAI: Registration for the 2nd Batch of *Five Days Residential Programme on Advanced Leadership for Chartered Accountants at IIM Ahmedabad *...