Updates:

1. CBDT has notified challan no. /ITNS 286 for Payment of Taxes under The Income Declaration Scheme, 2016.
2. Challan ITNS 285 is notified for Equalization Levy of 6% on payment of more than 1 lakh in F.Y. for online advertisement etc. to non-resident not having PE in India.
3. The Centre has decided not to raise the foreign direct investment (FDI) limit on newspapers and periodicals to 49 per cent from 26 per cent.
4. Closure of EPCG authorizations in case of supplies to SEZ units which have been made prior to 01.4.2015 and where exports proceeds have not been realized through Foreign Currency Account (FCA) of the SEZ unit.
5. RBI issues directions for lending to Micro, Small & Medium Enterprises Sector [Master Direction FIDD.MSME & NFS.3/06.02.31/2016-17]

Notification of NCLT and NCLAT Rules.

Subject:  Notification of NCLT and NCLAT Rules.

The Ministry of Corporate Affairs has notified National Company Law Tribunal  Rules, 2016 and National Company Law Appellate Tribunal Rules 2016, vide notification dated July 21, 2016. They shall come into force on the date of their publication in the official gazette.

The Company Secretaries in Practice are authorised to appear and present the case before NCLT and NCLAT.

The Notification is available at  the following links:

https://www.icsi.edu/webmodules/NCLT%20Rules.pdf

https://www.icsi.edu/webmodules/nclat%20rules.pdf

Investment in Section 54EC Bond

Section 54EC clearly states that the investment in specified bonds is to be made “within a period 6 months after the date of such transfer”, the intention of the legislature is clear. Had the legislature wanted to give liberty to the assessee to invest before or after the date of transfer, they would have explicitly said so, as has been provided in section 54 & 54F of the Act. Since such specific words are not used in section 54EC, deduction cannot be allowed to the assessee. [Smt. Dakshaben R. Patel vs ACIT [2012] 22 taxmann.com 237 (Ahd.-ITAT)]

full FAQ available on http://taxguru.in/income-tax/exemption-section-54-54ec-54f-faqs-case-laws.html

Refund couldn’t be denied just because scrutiny notice was served; HC quashed CBDT’s instruction

 

May 17, 2016[2016] 69 taxmann.com 226 (Delhi)

IT : By device of issuing an instruction in purported exercise of its power under section 119, CBDT cannot proceed to interpret or instruct income tax department to prevent issue of refund; Instruction No.1 of 2015 dated 13-1-2015 issued by the CBDT cannot be relied upon to deny refunds to assessees in whose cases notices might have been issued under section 143(2)

FACTS

• The assessee by way of instant petition has challenged Instruction No. 1 issued by CBDT and the consequential letter issued by Deputy Commissioner of Income-tax denying refund of assessee under section 143(1) for three assessment years

HELD

1.		It is the impugned instruction which is being relied upon by the Department to deny refund, where notice has been issued under section 143(2).
2.		The real effect of the instruction is to curtail the discretion of the AO by 'preventing' him from processing the return, where notice has been issued to the assessee under section 143(2). If the legislative intent was that the return would not be processed at all once a notice is issued under section 143 (2), then the legislature ought to have used express language and not the expression 'shall not be necessary'. By the device of issuing an instruction in purported exercise of its power under section 119, the CBDT cannot proceed to interpret or instruct the income tax department to prevent the issue of refund. In the event that a notice is issued to the assessee under section 143 (2), it will be a matter the discretion of the concerned AO whether he should process the return.
3.		Consequently, the Instruction No.1 of 2015 dated 13-1-2015 issued by the CBDT is unsustainable in law and is quashed. The said instruction cannot be relied upon to deny refunds to the assessees in whose cases notices might have been issued under section 143(2).

■■■

[2016] 69 taxmann.com 226 (Delhi)

HIGH COURT OF DELHI

Tata Teleservices Ltd.

v.

Central Board of Direct Taxes

Updates:

1. On Thursday, CBDT directed the income- tax department to “ expeditiously” issue refunds worth Rs. 5,000 for past three assessment years to provide immediate relief to taxpayers.
2. No TDS on payment for simple marketing services of introducing foreign institutional investors by foreign subsidiary companies.[Batlivala & Karani Securities (India) Pvt. Ltd. Vs. DCIT (ITAT Kolkata)].
3. Imposition of penalty on account of a discrepancy in the ‘batch numbers’ and ‘date of manufacture’ is unjustified.[M/s Hindustan Coca Cola Beverage Pvt Ltd vs The Commissioner, Commercial Taxes].
4. MCA21 will remain temporarily unavailable from 9:00 PM (16 July) to 9:00 AM (17 July). Stakeholder are advised to plan accordingly.
5. In exercise of the powers conferred by sub-sections (1) and(2) of section 469 and section 148 of the Companies Act, 2013, the Central Government further amends the Companies (cost records and audit) Rules, 2014, namely:-Companies (Cost Records and Audit) Amendment Rule 2016

7 reasons you can get an Income Tax Notice

 

You have paid all your taxes. You have filed your income tax returns diligently. Even then you get an income tax notice?! Before you cry foul, let us look at the reasons that you might have got one –

Reasons you can get an Income Tax Notice

1.     Incorrect details in the Income Tax Return –

You should fill your income tax return document carefully entering correct details such as name, address and PAN number. If there is any mistake in any of these details, you will be served a notice.

 

2.    Mismatch in Actual Income and Declared Income –

If there is a difference in the actual income you have earned and the income declared at the time of filing the returns, you can get a tax notice. You might not have done it on purpose. Since all financial transactions can be tracked and recorded, it is easy for the income tax officials to spot discrepancies. (must share any interest you have earned even if TDS was deducted, capital gains even if that’s small number, tax-free or dividend income)

 

3.    You have only paid the tax but not filed your returns –

Are you sure you filed your returns? Paying taxes and filing returns are two different things. If you have only paid the tax but not filed the returns, the tax department might send you a notice. Even if your taxes are nil after availing the deductions, you need to file your returns if your income is greater than Rs. 2,50,000. If you are a senior citizen, the limit is Rs. 3,00,000 and it is Rs. 5,00,000 for super senior citizens. You have to file tax returns even for your company which has made losses during that financial year. Some people just file the return online. That is not the end of the process. You have to submit the ITRV within 120 days of uploading the returns. Some people file the returns after the due date. Delays may lead to penalties. In such cases, you can get a notice from the IT department.

4.   Sudden changes in income or investment levels or high-value transactions –

If there is a sudden significant drop in income or a sudden sharp increase in income levels, the tax department will be on high alert. If you have purchased real estate property or assets of very high value or there are many high value transactions in your bank account, the income tax department can get curious and send you a notice. High value transactions can include cash deposits greater than Rs. 10,00,000 in a year or credit card purchases worth greater than Rs. 20,00,000 per year etc. If you make too many investments in your spouse’s name or child’s name, the income earned will be considered as your income and it should be included while assessing total income to be taxed. If this income is missing from your returns, you may get a notice.

 

5.    Discrepancies in TDS –

TDS can be deposited by the employer, bank where you have fixed deposits, bond issuer whose bonds you have invested in. If there is some mistakes in the TDS deducted and the income and interest that you have earned, you are likely to get a notice from the tax department. Sometimes the income in previous employment is not considered in the returns. If TDS is reflected in your Form 26AS, it can come to the notice of the department and they can question the same.

6.   Unpaid tax on interest income –

Unknowingly, you might have excluded certain interest income that you have received but since the interest is credited to your bank account or reinvested in your assets, it is easy for the department to trace it back to you and you can get a notice for non-payment on tax.

7.    Investigation Purpose –

The Income Tax department is always looking at widening the tax net and want to make sure all people earning income are assessed. They also want to ensure strict compliance. Therefore, they can send notices to random people. (If you were resident Indian in the last year & became NRI in Current financial year – chances of getting notice is very high)

What Next

If you get an income tax notice, you need not panic. You should find the reason for the notice and take the appropriate step to satisfy the notice. You can either submit the necessary documentation or refile the returns after making the necessary corrections. If you have been asked to be present in front of a tax official while filing returns, you should do so or authorise a tax expert to handle the case. He/She should have a valid power of attorney. If you think the notice is erroneous, you should respond appropriately with the necessary proof. It is important to respond to notices else the penalty and interest keep increasing.

 

Incorrect filing of returns is an offence. You can be charged penalties or even face imprisonment. Ignoring income tax notices takes time, money and effort in the long run. Therefore you should ensure that you file your returns correctly and respond to income tax notices if any, in the right manner.

 

 

INSTITUTE FOR CORPORATE ACHIEVERS: Updates:-

INSTITUTE FOR CORPORATE ACHIEVERS: Updates:-: DVAT Amendment Bill 2016 passed by Delhi Assembly on 13.06.2016 got LG's approval & has been notified as an Act by Law Departmen...