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Showing posts from April 29, 2016 News... News...

1.Mobilization expenses to move asset to client premises allowable as revenue expenses. [DewanChand Ramsaran industries Pvt. Ltd. vs. ACIT (ITAT Mumbai)].
2.No penalty for non deduction of tax based on CA certificate. [Smt. Aishwarya Rai Bachchan vs. Additional Commissioner of Income tax (ITAT Mumbai)].
3.TDS not deductible on tips collected by hotels and paid to staff [ITC Ltd. Gurgaon vs. Commissioner of Income Tax (TDS) {SC}].
4.MCA has issued general circular no. 04/2016 dated 27th April 2016: amended AS should be used for preparation of accounts for accounting periods commencing on or after the date of notification.
5.Delhi VAT extended online return filing due date till 16/05/2016 for Q4 15-16 vide circular no: 02 dated 28th April.

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Luxury Item Like Gold Jewellery Can't Stay Out of Tax Net: Jaitley

Says items used by common people are being taxed, rules out rollback of 1% excise duty

The government has ruled out rollback of 1% excise duty on gold jewellery levied in the budget, calling it a tax on a luxury item. Finance minister Arun Jaitley said gold cannot remain out of the tax net when goods used by common people were being taxed.

Jaitley referred to items like erred to items like soap, toothpaste, razor, pencil, ink, fruit juices and baby food attrac ting excise duty.

“Why should the luxury items be exempted from tax,“ he said, re sponding to a cal ling attention mo tion in Rajya Sab ha. He added that even imitation jewellery attracted 6% excise duty .Rubbishing Congress leader Raj Babbar's charge that government was killing the trade and hurting local artisans, the finance minister  reasoned that trade had not developed to the extent that annual turnovers of small jewellers had crossed Rs.6 crore.“This is implemented on big chains,“ he said, adding it was a step towards im…

Cos will Have Unique ID No. to Carry Out Biz

EASE OF DOING BIZ Corporate entities will no longer need multiple identities for business activities which will translate into simpler processes Companies will soon have one unique identification number to carry out all business transactions.

The Central Board of Direct Taxes (CBDT) and the ministry of corporate affairs are integrating their back-end operations to provide one simple identity to companies, 
doing away with the multiplicity of numbers currently being used by them, a senior government official told.

“While this will be implemented at Centre's level, states will have a unique number under the Goods and Service Tax,“ the official said.

Corporate entities will no longer require a battery of identity numbers including corporate, employer and tax payer identification numbers once this exercise is done. 

The move is meant to make processes simpler and facilitate ease of doing business.

“It will enhance transparency and reduce any complexities arising out of multiple filing, ther…

Govt Seeks Suggestions on MAT Committee Report

A government commit tee set up to frame the rules for computation of book profit of companies for levy of minimum alternate tax (MAT) under the new Indian Accounting Standards (Ind AS) has submitted its report. The government has called for suggestions on the recommendation by May 10, 2016. Under the new standard, which has greater fair value accounting, more unrealised gains and losses will get recognised in income statement, which could increase MAT profits.In view of this, the committee has suggested rules for when such gains should be counted towards book profits. -Our Bureau

The Economic Times, New Delhi, 29 April 2016

6% Equalisation Levy will Cripple Startup Firms

Levy will raise co's tax obligations by almost 50%

The proposed 6% equalisation levy on the online advertisement revenue of foreign companies introduced in the Finance Bill 2016 will “cripple the startup companies“ and raise their tax obligations by almost 50%, the Internet and Mobile Association of India (IAMAI) has said.

The industry body said that the levy will have a severe impact on Indian technology startups and small and medium enterprises (SMEs), which it said are primary users of digital ad platforms such as Google and Facebook.

An eight-member committee on taxation of ecommerce had in a report, released last month, proposed that services ranging from online advertising and cloud computing to software downloads and web hosting be subject to an “equalisation levy“ of 6-8% of gross payment if the provider of the service is a foreign entity without a “permanent establishment“ in India.

“The tech startups are already paying 14.5% service tax to use these ad platforms which amount…

Tax- free bonds score in secondary market

As interest rates are expected to move south, many savvy investors are buying tax- free bonds in the secondary market.

Some of these an effective yield of over seven per cent or 10 per cent return before tax — an attractive rate for those in the highest income tax bracket.

“We are advising the clients who are looking to make fresh investments in debt to add tax- free bonds in their portfolio. It’s a good time to get into these bonds. 

With pretax returns of around 10 per cent, they are attractive compared to other instruments,” says Sriram Iyer, chief executive officer of Religare Wealth Management. 

These bonds are liquid and are issued by companies that are not only backed by the government but also have high credit ratings. “ The interest rate risk at present is also low as rates are expected to go down further. These factors make them extremely safe to invest,” Iyer says.

State Bank of India’s 10- year fixed deposit offers seven per cent interest. For those in 30 per cent tax bracket, …

Sebi defers disclosures requirement for MFs

The Securities and Exchange Board of India ( Sebi) has deferred the deadline for enhancing scheme related to disclosures for mutual fund houses.

In a circular dated March 18, 2016, the market regulator had asked fund houses to disclose, effective from May 1, the aggregate investment in schemes by asset management companies board of directors, fund managers and other key managerial personnel.

In a letter to the industry body Association of Mutual Funds in India (Amfi), Sebi has pushed back the deadline by a month.

Also, fund houses are not required to show on its website separate scheme information document ( SID) and key information memorandum ( KIM) for each MF scheme managed by the AMC.

Industry officials say the whole new system required lot of technical changes which would have required time.

However, on the salary disclosures issue, there has not been any relief and sources told the Business Standard despite requests from fund houses.

According to the circular, each fund house has to m…

Panel gives bankruptcy law overseas ambit

Joint committee cuts timeline from 60 to 45 days; suggests shield for employees

Those filing for bankruptcy could find their assets in other countries assessed under Indian laws, if India implements the suggestions made by a parliamentary joint committee on the bankruptcy code.

The joint committee on the insolvency and bankruptcy code has said since “ many corporate transactions and businesses today involve an international and crossborder  element, the implications of crossborder insolvency cannot be ignored for too long.” The panel has suggested two new clauses and sub- clauses, which would require India to enter into agreements with foreign governments to enforce provisions of the code to debtors’ assets outside India as well.

In its report, the panel said if a resolution professional or bankruptcy trustee decides that a debtor’s assets located abroad should be brought under the ambit of the  law, then the adjudicating authority in the case should issue a letter of request to a court …