Updates

Updates:

1. Annual filing forms for Companies Act, 1956 - 23AC, 23ACA, 23B, 20B, 21A are likely to be available on MCA21 portal by mid-August 2016.
2. Interest rate on PPF retains at 8.1% for quarter ending September, 2016, same as stayed in 1st Quarter of 2016-17.
3. Exchange rate notification with effect from 24th June, 2016 Notification No. 88/2016 – Customs (N.T.) Dated the 23rd June, 2016.
4. Government servants who can be considered for rewards. Circular No.29/2016 Dated: 23rd June, 2016.
5. Foreign exchange management (foreign currency accounts by a person resident in india) Regulation, 2015-Circular-Dated 23-6-2016

Updates:-

Updates:-

1. No service tax on under construction flats if price includes land value via {Suresh Kumar Bansal vs UOI (Delhi High Court)}
2. Deferred consideration contingent on uncertain future event cannot be taxed before vesting of right to receive via {CIT vs. Mrs. Hemal Raju Shete (Bombay High Court)}
3. No service tax audit by service tax department or CAG via {Mega Cabs Pvt. Ltd. Vs. Union of India & Ors. (Delhi High Court)}
4. CBDT notifies cost inflation index for Financial Year 2016-17 via (Notification No. 42/2016-Income Tax dated 02/06/2016)
5. Section 14A disallowance cannot exceed total expense: CBDT Via (Notification No. 43/2016 dated 02/06/2016)

Updates

RBI

Reserve Bank of India (RBI) has issued Master Direction on Reserve Bank of India (Financial Services provided by Banks) Directions, 2016. As per the Direction, a Bank is not allowed to contribute more than 10% of its Paid up capital and reserves as per last audited balance sheet in factoring subsidiaries and factoring companies. Further it is not allowed to contribute more than 49% in the equity of a Debt funded NBFC. The master Direction does not allow a bank to undertake Mutual fund or Insurance business with risk participation except through a subsidiary set up for the same purpose. An AD Category I Scheduled Bank can become a trading or clearing member if its net worth is more than 500 crores and its NPA does not exceed 3%. The Master Direction came into force from 28^th May, 2016.

SEBI

Securities and Exchange Board of India (SEBI) has notified Disclosure of the Impact of Audit Qualifications by the Listed Entities. The circular requires a Listed Entity to disseminate the cumulative impact of all the audit qualifications in a separate format, while submitting the annual audited financial results to the stock exchanges to ensure that the investment decisions can be taken wisely by investors. This will ensure that the information is available to the investors, without delay, enabling them to take well informed investment decisions. It will further dispense with the existing requirement of filing Form A or Form B for audit report with unmodified or modified opinion respectively and requirement of making adjustment in the books of accounts of the subsequent year. The management of the Companies shall have the option to explain its vies on the audit qualifications. The Circular shall be applicable to all the Listed Companies submitting their Financial Year ended 31^st March, 2016.

Updates

1.No TDS for provident fund withdrawals of up to Rs 50,000 ( increased from Rs 30000/-) from today, June 1, 2016 as notified yesterday. 
2. Krishi Kalyan cess @ 0.5% on all taxable services with effect from Today, 01.06.16 resulting in effective rate of Service Tax @ 15% ie 14% service tax, 0.50 % swatchh Bharat cess and 0.50 % Krishi Kalyan cess.
3. Pay 45% Tax and declare undisclosed Income From 01.06.2016 to 30.09.2016.
4. TCS @ 1% will be applicable on purchase of car valued more than Rs 10 lacs and purchase of jewellary for more than Rs 5Lacs with effect from June 1,2016. The earlier limit of Rs 2 lacs on jewellery has been increased to Rs 5 lacs now.

News highlights:SEBI to draft proposals on high frequency trading soon

The head of India's capital markets regulator said on Wednesday it would increase monitoring of brokers and auditors and issue draft proposals for high frequency trading, laying out an ambitious agenda for itself in the year ahead.

It will also seek a better arbitration mechanism for investors, take a closer look at cyber-security, and focus on the implementation of recent regulations such as disclosure rules for listed companies, Securities and Exchange Board of India (SEBI) Chairman U.K. Sinha said.

The government in February extended Sinha's tenure by another year. He has been at the helm since 2011, a period during which SEBI has made it a priority to enhance market supervision, crack down on trading violations and shore up the confidence of retail investors.

That is an approach that will continue, Sinha said during an interaction with media at the SEBI headquarters in Mumbai.

He said there would be "monitoring of compliance by intermediaries," including brokers and "oversight of gatekeepers" such as auditors to prevent companies from engaging in deceitful activity.

SEBI will also aim to reduce the number of listed companies, Sinha said, estimating India had several thousand companies in exchanges including regional ones, many of which hardly trade or have been suspended for years.

The regulator would also issue a discussion paper on high frequency trades in the next three to four months, Sinha added, with a focus on ensuring that retail or other investors who do not have access to algorithimic trading are not disadvantaged.

Source:-REUTERS

HAPPY MAHA SHIVRATRI

May Lord Shiva shower you and your family with happiness and peace, while you with eternal love and strength. Happy Maha Shivaratri

Tribunal faced strong criticism for not following the judgment

 Tribunal faced strong criticism for not following the judgment

IT : Tribunal faced strong criticism for not following the judgment of jurisdictional High Court given in the case of the petitioner itself for an earlier Assessment Year on identical issue of applicability of Section 14A of the Act to partially disallow interest expenditure when interest free funds available with the Petitioner are in excess of investments made in tax free securities. 


• It was held by High Court that all authorities within the State are bound to follow its order unless the same is stayed or set aside by the apex court or larger bench take a different view. If the Tribunal doesn't follow this discipline, it would result in uncertainty of the law and confusion among the taxpayers as to what are their obligations under the Act. Besides opening the gates for arbitrary action in the administration of law, as each authority would then decide disregarding the binding precedents leading to complete chaos and anarchy in the administration of law. Hence, it is not open to the Tribunal to disregard the binding decisions of this Court. 

[2016] 67 taxmann.com 42 (Bombay) 
HIGH COURT OF BOMBAY 
HDFC Bank Ltd. 
v. Deputy Commissioner of Income-tax -2(3), Mumbai