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In a reprieve to foreign portfolio investors (FPIs), the income-tax department has clarified the circumstances in which the returns filed by these institutions will not be treated as defective. A number of notices of defective returns were issued under section 139(9) of the I-T Act to these investors who had not filed their balance sheet and profit and loss statement. A return is classified as defective when it excludes key information. In a statement issued on Thursday, the central board of direct taxes (CBDT) clarified that these returns will not be treated as defective in cases where such institutions are registered with the Securities and Exchange Board of India (Sebi) and have no permanent establishment or place of business in India and have made the necessary disclosures about their business income. This follows the government’s decision to accept the A.P. Shah panel’s report that had said that FPIs with no permanent establishment in India are not liable to pay minimum

The Reserve Bank of India has announced a one percentage point cut in the statutory liquidity ratio (SLR) in four equal stages by January 2017, giving banks more room to step up lending as credit demand picks up amid the economic revival gathering pace. SLR refers to the government securities that banks have to mandatorily hold. As of now, banks need to invest 21.5% of their deposits in government securities. The following is the timetable for the SLR reduction:   21.25% on April 2, 2016 21% on July 9, 2016 20.75% on October 1, 2016 20.50% on January 1, 2017.Most banks have SLR in excess of what's mandated. As per RBI data, the banking system had a collective SLR of 29.33% on October 30. The excess investment in government securities is primarily due to absence of credit demand. Also, most banks hold 2-3% excess SLR to meet any unexpected liquidity shortage. Banks can borrow from the RBI's repo window by pledging government securities. The Economic Times, New Delhi, 11t

The Central Board of Di rect Taxes, the apex direct taxes body, has announced simplification of the process of online rectification of incorrect details of tax deducted at source (TDS) filed in the income tax return (ITR). Earlier, taxpayers were required to fill in complete details of the entire TDS schedule while applying for rectification on the e-filing portal of the I-T Department. To avoid this, the CBDT has said a new facility has been provided for pre-filling of TDS schedule while submitting online rectification request on the e-filing portal to facilitate easy correction or up-dating of TDS details. “This is expected to considerably ease the burden of compliance on the taxpayers seeking rectification due to TDS mismatch,“ an official statement said. Errors due to incomplete TDS details in rectification applications were leading to delays in processing of such applications, thereby causing hardships to taxpayers, it added. The Economic Times, New Delhi, 11th Dec. 2015

Updates Of the Day 1.Cheque bounces cases to be filed at the Place of Presentation of Cheque and not the place of issue. Negotiable Instruments (Amendment) Bill passed on 07.12.2015. 2.MCA has modified the versions of e-Form GNL-4; Form INC-28; Form CRA-2; Form INC-2; Form ADJ; Form FC-1; Form FC-4 and Form AOC-CFS w.e.f 09.12.2015. 3.Indirect tax collections rose 34.3 per cent in the first eight months of 2015- 2016, led by high excise collections, signaling a pick- up in economic activity. 4.Penalty u/s 86(19) under DVAT cannot be imposed without affording an opportunity to the dealer to produce documents before impounding the vehicle. [Appellate Tribunal, Value Added Tax, Delhi: M/s Hindustan Unilever Limited]. 5.Levy of interest on late payment of duty by providing it in subordinate regulations would be deemed as ultra vires if the same not provided by provisions of act. [Supreme Court; Shree Bhagwati Steel Rolling Mills]. 6.CBDT has simplified the process of online rectific

Updates Of the Day 1.NIRC of ICAI is organizing three days Workshop on Income Computation Disclosure Standards ( ICDS) on 15th, 16th and 17th December 2015 at The Auditorium of ICAI Bhawan, Vishwas Nagar, Shahdara, Delhi from 4.30 PM to 07.30 PM FEE Rs.200/-(Per Day). 2.Income Tax Department, New Delhi invites Empanelment of CA Firms to carry out special audit u/s 142(2A) Last Date : 21.12.2015. 3.Interest, depreciation and profit margin not to be considered for arriving at production cost. [Nirma Ltd. & Others]. 4.RBI through its Master Circular dated 01.12.2015 (available on its websitewww.rbi.org.in) has issued Instructions/Guidelines on Credit Card/Debit Card/Pre-Paid Card. 5.RBI has issued Foreign Exchange Management (Transfer or Issue of Any Foreign Security) (Amendment) Regulations, 2015 which shall come into force from the date of their publication in the Official Gazette. 6.If upon a misconception of legal position, assessee had paid tax which he was not liable to p

Parliament passes law to facilitate easy legal recourse after Rajya Sabha okay Parliament has passed a law allowing cheque bounce cases to be filed at the place where the cheque is presented for clearance and not the place of issue, a change that is expected to go a long way in improving legal recourse in such cases. The Rajya Sabha passed the Negotiable Instruments (Amendment) Bill on Monday without any debate. The Minister of State for Finance Jayant Sinha moved the bill for passage that had been passed by the Lok Sabha earlier. The amendments to the Negotiable Instruments Act will impact over 18 lakh cheque bounce cases pending in various courts, Sinha said while moving the bill. The amendments overturn a Supreme Court ruling which said the cases have to be initiated where the cheque-issuing branch was located. The court had reasoned that the territorial jurisdiction for dishonour of cheques is restricted to the court within whose local jurisdiction the offence was com

The goods and services tax (GST) Constitution amendment Bill is likely to be listed for discussion in the Rajya Sabha not before December 14, which would leave the government with eight days of the winter session to get the key tax reform passed by the Upper House and subsequently the amended Bill by the Lok Sabha before the session ends on December 23. Central ministers said they haven’t lost hope about the GST Bill being passed in the ongoing session, despite no clear indications emerging from the Congress leadership, particularly from Congress President Sonia Gandhi and Vice- President Rahul Gandhi. The Congress has conveyed to the government that while it had agreed that the Rajya Sabha’s Business Advisory Committee allocate four hours for a discussion on the Bill, the Bill should only be listed in the day’s business after the Upper House discusses other issues of urgent public importance, especially the drought situation in large parts of the country and the price rise. The