CA Online

The government has extended the last day for filing GSTR-3B returns to October 25 in the backdrop of apprehensions over availing input tax credits for July 2017-March 2018.  “In view of the said apprehensions and with a view to give some more time to the trade and industry, the last date for furnishing return in the form GSTR-3B for the month of September 2018 is being extended up to October 25, 2018,” the Central Board of Indirect Taxes and Customs said in a post on Twitter on Sunday. The original deadline was October 20. Industry has been worried about losing hundreds of crores of rupees in input tax credits due to mismatches in tax payment or reporting by their suppliers, who have time till October 31 to file their GSTR 1.  Tax experts said the extension doesn’t really help much because most companies would have filed their returns by October 20.  “Since there is no facility for amendment of the return, the companies cannot claim the credit which they might have missed. To provi

Policy watchers surprised by the Reserve Bank of India’s (RBI) decision to hold rates in October against a widely expected hike are fairly certain that this interlude will be over as soon as December.  They are probably right.  The minutes of the October policy meet show that the central bank’s rate-setting committee members did not tone down their hawkishness or reduce their vigil on inflation when they had recommended a pause.  In fact, long-standing hawk and RBI executive director Michael Patra said monetary policy needs to be on “high alert” on inflation. He merely felt that the need to raise rates was less because the past two rate hikes still haven’t reached all corners of the economy. Chetan Ghate, who voted for a hike, felt that the sharp depreciation.  The members of the monetary policy committee flagged off several risks to inflation even as the headline number softened for three consecutive months. 3.28 the exchange rate and rise in oil prices would unhinge inflationary

The Reserve Bank of India is trimming its holding of US Treasuries joining many other emerging economies which have been selling off US bonds amid rising rates. Yet, it figures in the list of top-15 foreign lenders to the US government.  RBI sold $16.3 billion worth of US treasury (USTs) bonds since April with its stock slipping from $157 billion as of March-end to $140 billion as of August-end, according to the latest data released by the US Treasury department. In the same period, China sold USTs worth $22.6 billion, while Taiwan sold $6.9 billion worth of USTs. This could be to reduce their mark-to-market losses as bond prices fall when interest rates rise. In India’s case, it is also due to the fact that RBI needed US dollars to sell in the market to stop the steep currency slide. The Indian central bank sold foreign currencies worth $18.6 billion in the spot market since April to rein in the value of the rupee.  Foreign portfolio investors have pulled out more than $10 billion

The plea by an NGO cited an RBI report that found banks were not passing benefits of lower rates to customers The plea alleged that by failing to take action on the petitioner’s repeated requests for justice on behalf of citizens, RBI had deliberately acquiesced in the discrimination by banks in the name of implementing the marginal cost of funds-based lending rate (MCLR) regime.  From time to time, RBI has expressed concerns about the reluctance of banks to pass on rate cuts to consumers, and made several attempts to change the way they price their loans. In 2003, RBI introduced the benchmark prime lending rate (BPLR), but this failed to bring in transparency, as a large part of the lending took place at interest rates below the announced BPLRs. Then came the base rate, which was to be the minimum rate for all loans and calculated on the basis of cost of funds. Individual borrowers were charged a spread over the base rate, which was tweaked to benefit only new borrowers.  The dr

LACUNAE Grandfathering benefit for taxes on longterm capital gains doesn’t cover mergers, demergers Investors of at least two dozen companies, including Capital First, Ultra Tech Cement, Bharat Financial, will have to shell out higher capital gains tax. This is because the ‘grandfathering’ benefit for taxes on longterm capital gains — reintroduced in this year’s Union Budget — doesn’t cover mergers and demergers. Grandfathering refers to exemptions on the gains made prior to enactment of a new law from the ambit of the new law.  The government said longterm capital gains tax will be calculated based on the Jan 31 trading price of a stock. However, this benefit applies only to stocks acquired or purchased before Jan 31, 2018. If the shares were non-existent or unlisted as on Jan 31 long-term capital gains tax would be calculated based on original cost of purchase. In mergers, investors of the company getting acquired receive shares of the new company in exchange for their original

Bonds would earn an interest of 2.5 per cent per annum, payable every six months on the nominal value The Central government will issue Sovereign Gold Bonds 2018-19 for public subscription from October 15-19.  "Government of India, in consultation with the Reserve Bank of India, has decided to issue Sovereign Gold Bonds-2018-19," a Finance Ministry statement said on Monday.  "The Sovereign Gold Bonds will be issued every month from October 2018 to February 2019."  According to the statement, bonds would earn an interest of 2.5 per cent per annum, payable every six months on the nominal value. The bond certificates would be issued on October 23.  "Price of bond will be fixed in Indian rupees on the basis of simple average of closing price of gold of 999 purity, published by the India Bullion and Jewellers Association Limited for the last 3 working days of the week preceding the subscription period," the statement said. "The issue price of the Gol

The domestic unit on Monday slumped 30 paise to finish at a fresh lifetime low of 74.06 amid strengthening of the greenback and steady capital outflows.  The rupee on Tuesday slipped back to 74 levels after opening 18 paise higher at 73.88 against the US dollar.  The domestic unit fell up to 74.02 in the early trade. At 09:44 am, the currency was trading at 73.98 against the greenback.  Earlier, after crashing to a fresh record low of 74.06 on Monday, the rupee recovered a bit and opened 18 paise up at 73.88 against the US dollar on Tuesday.  The domestic unit on Monday slumped 30 paise to finish at a fresh lifetime low of 74.06 amid strengthening of the greenback and steady capital outflows. It was the 6th straight session of rupee depreciating against the dollar. Foreign institutional investors (FII) were net sellers to the tune of Rs 4,419 crore on October 5, 2018. FIIs have been net sellers to the more than Rs 11,405 crore in October 2018, according to a note by ICICI Securitie