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www.caonline.in News... 1. Transfer of goods by way of hiring, leasing, licensing or in any such manner without transfer or right to use such goods is a “declared service” and hence liable to service tax. 2.Deduction U/s 35AC available only up to previous year ending 31-03-2017. 3.Eminent economist and RBI Dy. Governor, Mr. Urjit Patel replaces Raghuram Rajan as RBI Governor. 4.SEBI has issued Frequently Asked Questions (FAQs) on SEBI (Alternative Investment Funds) Regulations, 2012. 5.CBDT issues Clarifications on Income Declaration Scheme, 2016. CBDT Circular No.29 of 2016 dated 18.08.16.

Online retailers worried about draft GST law not providing for refund of tax paid on goods returned by the customers The government is looking into the biggest concern of online retailers with the goods and services tax (GST) -rules relating to returned goods that have at times even reached as high as half their sales. The draft GST law does not provide for credit on tax paid on returned goods, potentially imposing double taxes on sellers -tax paid on returned goods and again when replacements are provided. GST may be put in place as early as April 1. The industry also fears return of the permit raj, with the law allowing states to seek additional documents from transporters carrying goods exceeding ` . 50,000. “Industry probably prefers more clarity as the term `sales return' has not been used,“ said an official, adding that it could be examined. Online sale returns average around 30%, but in India this can be as high as 50%. The GST law, however, does not provide for

Govt feels the entire exercise should be over by March 31 Union Budget has for decades been presented on last day of February , but this could soon change with the government mulling advan cing it to January end so as to complete the budget exercise before the beginning of the new fiscal. Finance Ministry is doing an overhaul of the entire Budget making exercise which may see scrapping of the current practice of presenting a separate budget for Railways and the Budget document getting slimmer with indirect tax proposals finding almost no mention after excise duties, service tax and cesses being subsumed in the Goods and Services Tax (GST) regime. Also on the anvil is abolition of distinction between Plan and non-Plan expenditure and replacing it with capital and revenue expenditure. Sources said the government is of the view that the Budget exercise should ideally be over by March 31every year as against the present practi ce of it being carried in two phases spread betwe en

Plans are afoot to train 20,000 chartered accountants by March 2017 in different aspects of the GST Corporate India is just about getting started to get their businesses ready for the goods and services tax ( GST) regime. This has opened up a sizable business opportunity for tax experts, advisory firms, and law firms. What has come as a shot in the arm for chartered accountants and cost accountants is the mandatory need for tax audits for certain companies under the GST regime. Under Section 42 ( 4) of the draft Model GST Law, businesses with to- be- prescribed turnover have to get their accounts audited by a chartered accountant or a cost accountant. Accordingly, the Institute of Chartered Accountants of India ( ICAI) is preparing to boost training for its members to enable them to make the most out of the opportunity. “ Plans are afoot to train 20,000 chartered accountants by March 2017 in different aspects of the GST for conducting impact studies and filing of GST returns,” sa

AUTOMOTIVE Companies made adjustments to revenue recognition. This was more visible in case of deferment of revenue of future performance obligations, or for recognition of cash/ trade discounts ENERGY, METALS AND MINING The sector is heavily capital- intensive and exposed to the global commodity/ currency markets. Some high- value adjustments arose due to: Forex gains and losses, particularly due to change in the functional currency of the company and of its foreign operations Change in accounting policy, primarily for oil companies with respect to capitalisation of expenditure and depletion of producing assets Adjustments in fixed assets. Saw capitalisation of new assets as a result of major overhauling costs Presence of embedded finance lease arrangements. This was more visible for the power companies; Companies that had previously capitalised fixed assets on their balance sheet have de- capitalised these assets, reversed the corresponding depreciation charged and recognised fin

If a company’s only income is from leasing property, it should be taxed under the provision ‘ profit and gains of business or profession’ and not under the head ‘ income from house property’, the Supreme Court has ruled in its judgment, Rayala Corporation Ltd vs Asst Commissioner. In this case, the company leased its property and said even if its income was in the nature of rent, it should be treated as business income, because it is in the business of renting property, and the only income received is in the nature of business. It further said it is a private limited company and, according to its memorandum of association, its business is to deal in real estate and earn income by renting its properties. On the other hand, the income tax assessing officer and the Madras High Court maintained that it was earning income from house properties. The Supreme Court set aside the high court judgment and accepted the company’s argument. Business Standard New Delhi,22th August 2016