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Updates Of the Day 1.The Reserve Bank of India (RBI) has cancelled the registration of 56 non- banking financial companies (NBFCs). 2.CEA led Panel recommends RNR at 17-18% and eliminating Additional Tax of 1% on inter-state supply of goods. 3.Free warranty services provided by vehicle-dealers to vehicle-buyers out of their dealer’s margin/ handling charges is not liable to Service tax:[Chowgule Industries (P.) Ltd] . 4.No VAT on free supply of medicines – State Govt. not competent to levy tax on the basis of MRP or any other notional value. [Mapra Laboratories Pvt. Ltd]. 5.Where seller has not reduced his Output Tax liability in pursuance to the Credit Notes the purchaser is not required to reverse Input Tax Credit. [Appellate Tribunal, VAT : of M/s Khanna Photo Store]. 6.CBDT allows service of notice, summons, requisition, order etc. by Email. Notification No. 89/2015. 7.CBDT issued notification to Issue refund below Rs.50,000/- Expeditiously in Non-CASS cases : Notification ...

The Central Board of Direct Taxes ( CBDT) has notified use of emails as the new mode of communication between the taxman and taxpayers, as part of the governments e- initiative to reduce human interface and complaints of harassment and corruption in conducting tax related jobs. The amendment in the Income Tax Act was also required as the department has recently launched a pilot project of sending email queries, notices and summons to taxpayers while processing cases of scrutiny. According to the notification 89 issued by the CBDT, the apex policy- making body of the tax department, an amendment has been made in the Section 282 of the I- T Act ( Service of notice) allowing for inclusion of taxpayers or tax paying entities email as the new mode of official communication along with the existing modes like courier, postage or departmental dispatch. Henceforth, the taxman can now send official communication to “ email address available in the income- tax return details furnished by th...

The finance ministry wants Employees Provident Fund Organisation ( EPFO) to retain 8.75 per cent rate of interest on provident fund (PF) deposits for 2015- 16 although the retirement fund body is in a position to give better returns to its over 50 million subscribers. The EPFO has provided 8.75 per cent rate of interest on PF deposits for previous two financial years — 2013- 14 and 2014- 15. “During a recent meeting of finance ministry and labour ministry top officials, of the former urged the latter that the EPFO should retain its 8.75 per cent interest on deposits for the current fiscal as well in view of the governments intention to reduce rate of returns on small saving schemes and PPF," a source said. The source further said, “EPFO has already worked out the income projection for the current fiscal, on the basis of which it can provide higher rate of returns than 8.75 per cent provided in the previous two financial years.” Business Standard, New Delhi, 7th Dec. 2015...

RBI to allow computation of banks ’base rates on the basis of marginal cost of funds In a move aimed at ensuring faster transmission of rate revisions, the Reserve Bank of India ( RBI) is set to release its final guidelines on computation of banks’ base rates on the basis of marginal cost of funds. These guidelines, allowing dynamic pricing of loans as suggested by banks, are likely to benefit new customers. One suggestion made by the bankers’ lobby — there are indications that RBI has taken it seriously — is that pricing of loans should be changed on the basis of market- linked yields, with a clause for reset every quarter or year. While it is not yet clear whether the yields taken into consideration will be on adaily basis or an average, dynamic pricing of loans will be tricky business for borrowers, who will also have to time their borrowings according to money markets and the view on interest rates. That is because the rate could be reset only after a quarter or a year of a l...