Thursday, August 17, 2017

On Clarification regarding availability of Transitional Credit for GST

On Clarification regarding availability of Transitional Credit for GST 
As per the rules, the Goods and Services Tax (GST) for the month of July 2017 has to be paid by 20th August, 2017. Only after the payment of full GST, return in summary Form 3B can be filed. 

Concerns have been raised about the form for claiming transitional input tax credit not being available on the GSTN website. This form will be available on the GSTN website from 21st August, 2017. In view of this, a small window of opportunity is being given to all the taxpayers. For those taxpayers who do not want to claim any transitional input tax credit have to necessarily pay the tax and file return in Form 3Bbefore the due date of 20th August, 2017. The taxpayers who want to avail the transitional input tax credit should also calculate their tax liability after estimating the amount of transitional credit as per Form TRANS I. They have to make full settlement of the liability after adjusting the transitional input tax credit before 20th August, 2017. However, in such cases, they will get time upto 28th August, 2017 to submit Form TRANS I and Form 3B. In case of shortfall in the amount already paid vis-à-vis the amount payable on submission of Form 3B, the same will have to be paid with interest @ 18% for the period between 21stAugust,2017 till the payment of such differential amount. 

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DSM/SBS/AK
(Release ID :170061)

Saturday, August 5, 2017

IBC an ideal tool for solving bad loan issue SOURCE BUSINESS STANDARD

IBC an ideal tool for solving bad loan issue

SANJAY DOSHI
While the government has been pursuing measures to tackle rising levels of nonperforming debt in public sector banks,agrowing pile of bad debt had also beenaconcern for the lender community.
With its clear and precise outlook towards insolvency, the Insolvency and Bankruptcy Code (IBC) 2016 might not only serve as an ideal tool to solve the badloans issue, but is also expected to haveasignificant impact on the conduct of business in the country.
Under the Code, an insolvency proceeding can be commenced by any creditor (financial or operational) or the corporate debtor itself, by filing an application with the Adjudicating Authority (AA) at the National Company Law Tribunal (NCLT). Insolvency proceedings can be initiated on admission of the application by the NCLT, after which the lenders have to formacommittee of creditors (CoC) and appoint an insolvency professional (IP) to act asaresolution professional (RP) and run the borrower´s business in the interim period.
To arrive ataresolution, the Code prescribes preparation and submission ofa “resolution plan” withinarational timeline of 180/270 days from the commencement of insolvency proceedings.
Section 5(28) of the Code definesaresolution plan as “aplan proposed by any person for continuation of the corporate debtor asagoing concern in accordance with Part II”.
The objective ofaresolution plan is to maximise eventual returns to the creditors.
Aresolution plan must be prepared in accordance with Regulation 37 and 38 under the Code.
Regulation 38 stipulates mandatory contents ofaresolution plan, which should include specific sources of funds to pay insolvency resolution process costs, sources of funds to pay liquidation value (operational creditors and dissention financial creditors), the term of the plan, implementation schedule, the manner of management of the business and adequate means for supervision.
The Code stipulates that it will be the RP´s duty to invite prospective lenders, investors and any other persons to put forward the resolution plan.
The corporate debtor may also filearesolution plan for consideration.
According to Section 25(i) of the Code, it will be the RP´s duty to present all resolution plans received at the CoC´s meetings.
The responsibility of approvingaresolution plan rests with the CoC, which will approve it with not less than 75 per cent voting in favour of it. Whereaplan approved by the CoC is subsequently approved by the AA, the final plan will be binding on the corporate debtors, its employees, members, creditors, guarantors and other stakeholders involved in the resolution plan.
If the CoC fails to approve and submitaresolution plan within the prescribed time, the corporate debtor could look at liquidation as an option, which will result in auctioning of the company´s assets to recover dues.
The NCLT is not expected to rejectaplan on the ground that it is not feasible, or possible to implement the plan fromapractical or economic/commercial point of view.
The NCLT is not meant to delve into the technical and economical complexity of the plan on what is essentiallyacommercial decision of the creditor.
However, the resolution plan may be challenged at the NCLT on technical grounds such as irregularities in conduct of meetings or voting process, challenge in calculation and payment of liquidation value, whether the plan is unfair, unjust and prejudicial to the interest of petitioner, and whether approval was obtained by fraud or misrepresentation.
However, there are certain areas around the resolution plan which remain unaddressed by the Code.
There is lack of clarity on whether the CoC can approve more than one plan byamajority, and whether the AA can request modifications in plans approved by the CoC on technical grounds or mistakes apparent from records.
The Code is also silent on changes that may be required after approval ofafinal plan by the AA, due to circumstantial variations such as change in regulation, loss of key customer or cancellation of licence.
Clarity is also required on whether consent of shareholders is required on the approved plan for sale of assets, mergers and amalgamation, as per the provisions of the Companies Act, 2013.
In the past, the RBI has initiated various restructuring schemes —such as Corporate Debt Restructuring, Strategic Debt Restructuring, Joint Lenders Forum, Scheme for Sustainable Structuring of Stressed Assets and the 5/25 scheme —to enable lenders to formulateaplan of action and restructure debts of companies facing financial difficulties onatimely basis.
While these schemes had the essence ofaresolution plan, they were prescriptive and lacked flexibility.
The resolution plan under the IBC is expected to be more objective, flexible and resolutionoriented.
Agood resolution plan should be based onarobust business strategy, and list material assumptions underpinning the business plan, including current laws.
It should also highlight key critical factors and milestones, and clearly define the implementation and monitoring mechanism.
An approved resolution plan under the IBC should beamanifestation of the combined judgment of all stakeholders, having the objective of maximising eventual returns to the creditors, thereby preserving the value of the business.
Lastly, it is expected to provide better results than prospective liquidation byacorporate debtor.
The writer is Partner, KPMG in India.
These views are personal

Friday, July 21, 2017

GST compostion scheme extension


The Central Government today extended the time limit for filing Intimation for Composition Levy
for the small businesses with turnover of up to Rs 75 lakh under the CGST Act.

I.e. 16th August 2017.

Saturday, April 1, 2017

Main object Backery

BAKERY


To carry on in India or elsewhere the business to manufacture, produce, process, prepare, disinfect, fermentate, compound, mix, concentrate, pack, repack, heat, grade, preserve, freeze, buy, sell, resell, import, export, barter, distribute, market, supply and to act as agent, broker, representative, collaborator, franchiser, adatiya, stockist, liasioner, middleman, job worker or otherwise to deal in all types, descriptions, test, uses and packs of bakery items, their bye-products such as bread, fruit bread, biscuits, cakes, farinaceous material and other farinaceous compounds and items of every description and all other items, whether natural, artificial or synthetic, of a character similar or analogous to the foregoing or connected therewith and to do all incidental acts things necessary for the attainment of the foregoing objects.

Media and Advertising main objects

. To carry on in India or abroad the business of event management, advertising and publicity agents, sub-agents, consultants and contractors and for this purpose to purchase, sell, sponsor, charter, manage, acquire, undertake, hold, provide and promote, publicity or advertising time space or opportunity on and radio station, broadcasting center, television center, music video and music  audio video cassettes, hoarding, neon signs, electronic display board, cinema cable network,  newspaper, magazines, souvenirs and all other present and future medias or device s including electronic media through internet and other display devices of all kinds and descriptions or to organize trade fairs, exhibitions, road shows to promote the sale or any other interest of its clients.
2. To carry on the business of advertising agency for providing to advertise a complete range of advertising services on all mass media such as hoardings, newspapers, magazines, radio, television and film and to organize and conduct events, stage shows, fashion shows, trade fairs and exhibitions.
3  To carry on the business of public relations, show promotion, advertisers, advertising contractors and advertising agents, printers, publishers, designers, lithographers, engravers, and to  acquire and undertake the whole or any part of the business property and liabilities of any person,  firm or company carrying on any of such business or any other business which may be usefully carried  on therewith including business relating to travels and tour promotions.
4. To carry on the business of marketing, and to carry on designing and producing, publishing of banners, magazines, catalog and broachers.

Friday, March 31, 2017

Companies (Meetings of Board and its Powers) Amendment Rules, 2017

GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
Notification
New Delhi, 30th March, 2017
Companies (Meetings of Board and its Powers) Amendment Rules, 2017
G.S.R. 309(E).- In exercise of the powers conferred under sections 173, 175, 177, 178, 179, 184, 185, 186, 187, 188, 189 and section 191 read with section 469 of the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the following rules further to amend the Companies (Meetings of Board and its Powers) Rules, 2014, namely:-
1. (1) These rules may be called the Companies (Meetings of Board and its Powers) Amendment Rules, 2017.
    (2) They shall come into force on the date of their publication in the Official Gazette.
2. In the Companies (Meetings of Board and its Powers) Rules, 2014, in rule 15, in sub-rule (3), in clause (a)-
  1. in item (i), item (ii), item(iii) and item (iv), for the words “exceeding ten percent.” wherever they occur, the words “amounting to ten percent. Or more” shall be substituted; and
  2. in item (iii), for the words “ten percent. of turnover” the words “ten percent. or more of turnover” shall be substituted.
 
Read more at:
 

Amendment in Schedule III

GOVERNMENT OF INDIA
MINISTRY OF CORPORATE AFFAIRS
Notification
New Delhi, 30th March, 2017
Amendment in Schedule III
G.S.R. 308(E).-ln exercise of the powers conferred by sub-sections (1) of section 467 of the Companies Act, 2013 (18 of 2013), the Central Government herby makes the following further amendments to Schedule III  of the said Act with effect from the date of publication of this notification in the Official Gazette, namely:-
2. In the Companies Act, 2013  (hereinafter referred to as the principal Act), in Schedule III, in Division I, in Part I under the heading “General instructions for preparation of Balance Sheet” in paragraph 6, after clause ‘W’, the following clause shall be inserted namely:- 
Read more at:

Companies (Audit and Auditors) Amendment Rules, 2017

GOVERNMENT OF INDIA
Ministry of Corporate Affairs
Notification
New Delhi, 30th March, 2017
Companies (Audit and Auditors) Amendment Rules, 2017
G.S.R.  307(E).-In exercise of the powers conferred by section 143 read with sub-sections (1) and (2) of section 469 of the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the following rules further to amend the Companies (Audit and Auditors) Rules, 2014, namely:-
1. (1) These rules may be called the Companies (Audit and Auditors) Amendment Rules, 2017.
      (2) They shall come into force on the date of their publication in the Official Gazette.
2. In the Companies (Audit and Auditors) Rules, 2014, in rule 11, after clause (c), the following clause shall be inserted, namely:-
    “(d) whether the company had provided requisite disclosures in its financial statements as to holdings as well as dealings in Specified Bank Notes during the period from 8th November, 2016 to 30th December, 2016 and if so, whether these are in accordance with the books of accounts maintained by the company.”
Read more at:

Key changes in new ITR forms for AY 2017-18

Key changes in new ITR forms for AY 2017-18

The CBDT has notified new income-tax return forms (ITR forms) for the assessment year 2017-18. It has prescribed simplified version of ITR-1 with fewer columns. A new column has been inserted in ITR Forms to report cash deposits in banks above 2 lakhs during the demonetisation period, i.e., from November 9, 2016 to December 30, 2016.
CBDT had prescribed new 'Form ITR 4 Sugam' for taxpayers opting for presumptive taxation scheme. A new column has been prescribed to mention digital receipts as the rate of presumptive income is 6% for such receipts.
Changes in new ITR forms:-
1) Simplified one page ITR Form for Salaried class taxpayers
[ITR 1 Sahaj]
Now the Govt. has notified simplified one page form 'ITR-1 Sahaj' for individuals earning income from salary, pension, one house property and income from other sources. It has removed columns which are not frequently used by the taxpayers.
New 'ITR-1 Sahaj' has retained those deductions which are most frequently used by the taxpayers, viz, under Section 80C, 80D, 80G and 80TTA.
If any taxpayer wants to claim deduction under any other provision of chapter VI-A he can specify the relevant Section in column titled as 'Any other'. Schedules of TDS and TCS have been merged into one in order to make ITR 1 shorter and simpler.
However, new columns have been inserted to report dividend income and long-term capital gains exempt under Section 10(34) and Section 10(38) respectively.
2) Disclosure of cash deposits during demonetization
[ITR 1, 2, 3, 4, 5, 6, 7]
A new column has been introduced in all ITR Forms to report on cash deposited by taxpayers in their bank accounts during the demonetization period, i.e., from November 9, 2016 to December 30, 2016. However, taxpayer are required to fill up this column only if they have deposited Rs 2 lakh or more during the demonetization period.
3) Quoting of Aadhar Number
[ITR 1, 2, 3, 4]
The Finance Bill, 2017 as passed by Lok Sabha has introduced a new Section 139AA requiring every person to quote Aadhar number in the return of income. If any person does not possess the Aadhaar Number but he had applied for the Aadhaar card then he can quote Enrolment ID of Aadhaar application Form in the ITR.
It may be noted that firms are also required to Quote Aadhaar number of their Partner/members in new ITR 5. Further, in case of trust Aadhaar number of Author(s) / Founder(s) / Trustee(s) / Manager(s), etc., are required to be specified in new ITR 7.
4) Income taxable at special rates
[ITR 2, 3, 5, 6, 7]
Unexplained income
As per Section 115BBE any unexplained credit or investment attracts tax at 60% (plus surcharge and cess, as applicable), irrespective of the slab of income.
Now new columns have been inserted in ITR Forms under 'Schedule OS' to report such unexplained income under 'Schedule SI'.
It may be noted that any taxpayer having unexplained income cannot opt for ITR-1 Sahaj.
Dividend above Rs 10 lakhs
As per Section 115BBDA the dividend received from domestic company is taxable at rate of 10% if aggregate amount of such dividend exceeds Rs. 10 lakh. New column has been inserted in ITR Forms to declare such dividend income in 'Schedule OS'.
It may be noted that any taxpayer having dividend income above Rs 10 lakhs and covered under Section 115BBDA cannot opt for 'ITR-1 Sahaj'.
Patent income
A new column has been inserted in ITR Forms to declare royalty income from patent developed and registered in India and chargeable to tax at 10% under section 115BBF.
5) Deduction under section 80EE
[ITR 2, 3, 4]
Section 80EE allows deduction on home loan interest for first time home buyers. This deduction is over and above the Rs 2 lakhs limit covered under Section 24(b).
A new field has been provided in new ITR Forms under Schedule VI-A deductions to claim home loan interest under Section 80EE.
6) Declaration of value of assets and liabilities by Individuals/HUF earning above Rs 50 lakhs
[ITR 2, 3, 4]
During 2016, the Govt. had introduced new Schedule requiring individuals/HUFs to declare the value of assets and liabilities if their total income exceeds Rs. 50 lakhs. Taxpayers were required to mention cost of immovable property, jewellery, bullion, vehicles, shares, bank and cash balance, etc.
Now tax payers are also required to disclose address of immovable property and description of movable assets in new ITR Forms. Further, new fields have been introduced in ITR Forms for disclosure of 'Interest held in the assets of a firm or AOP as a partner or member'. Such members/partners are also required to disclose name, address, PAN of the firm or AOP.
7) Registration number of Chartered Accountant Firm
[ITR 3, 5, 6]
Now taxpayers are required to mention registration number of firm of Chartered Accountant which has done audit in ITR Forms.
8) Bifurcation of receipt/expenses from business and profession in no account case.
[ITR 3, 5]
In old ITR Forms there was no option to bifurcate income and expense of business and profession separately. All receipts were to be clubbed together and shown in ITR.
Now in new ITR forms, there is an option to show receipts from business and profession separately.
9) Deduction of additional depreciation in case of asset put to use for less than 180 days in preceding year
[ITR 3, 5, 6]
In case of purchase of an asset which is put to use for less than 180 days, additional depreciation shall be restricted to 50% for that year and remaining would be allowable in the succeeding year.
In old ITR Forms, no column was there under 'Schedule DPM' to claim unutilized 50% additional depreciation in succeeding year. Now in new ITR Forms such column has been inserted to claim unutilized 50% depreciation.
10) Segregation of digital receipts and other receipts under presumptive taxation scheme
[ITR 4]
As per the presumptive taxation scheme under Section 44AD, 8% of gross receipts or turnover will be deemed as income of the taxpayer. However, in 2017 Union Budget such limit has been proposed to be reduced to 6% for digital receipts of taxpayer.
In new ITR form, new columns have been inserted to show turnover received through digital mode. Consequently, columns have been inserted to show presumptive income at 6% and 8%.
The Finance Act 2016, had introduced the presumptive taxation scheme for professionals as well. Now new ITR 4 Form shows an option to avail such presumptive taxation scheme for professionals under Section 44ADA.
11) Details of receipts as mentioned in Form 26AS under TDS schedule
[ITR 4]
ITR 4 which is now applicable for taxpayer opting for presumptive taxation scheme has a new column under the 'Schedule TDS2' to show the receipts as mentioned in Form 26AS.
12) Disallowance for non-deducting or non-payment of Equalisation levy
[ITR 3, 5, 6]
The Finance Act, 2016 has introduced new provision to deduct 1% Equalization Levy on payment made for certain advertisement services paid to non-residents.
Any default in deduction or payment of Equalization levy would attract disallowance of Section 40(a)(ib). In new ITR Forms a new column has been inserted under 'Part A-OI' to mention such disallowance under section 40(a)(ib).
13) Disallowance of any amount payable for use of railway assets
[ITR 3, 5, 6]
Any sum payable by the assessee to the Indian Railways for the use of railway assets shall be allowed as deduction on actual payment basis as per section 43B.
A new column has been inserted under 'Part A-OI' for disallowance under section 43B in case of non-payment of such amount on or before due date of furnishing return of income.
14) New schedule to report 'receipt and payment' account of a company under liquidation
[ITR 6]
A new schedule 'Part A-OL' has been inserted in ITR 6 to furnish details of 'receipt and payment' account of company under liquidation.
15) Changes related to ITR 7
[ITR 7]
Various changes have been introduced in the new ITR 7 form. Now trust is required to furnish following additional details in new ITR 7 -
  a) Registration number and date of registration for business trusts registered with the SEBI.
  b) 'Schedule AI' to report aggregate of income referred to in section 11 and 12 excluding voluntary contribution.
  c) 'Schedule ER' to report amount applied to charitable or religious purposes (revenue account).
  d) 'Schedule EC' to report amount applied to charitable or religious purposes (capital account).
  e) 'Schedule 115TD' to report accreted income of trust under section 115TD
taxmann.com

Monday, January 16, 2017

Centre, states end GST logjam, but rollout now in July source Times of Inida

Finally  GST  roll out  will happen in 1st  July 2017  instead of  1st April 2017

GST  council  agreed  on a formula which will see states administer and control 90% of the smaller entities, with the remaining coming under the Centre's purview

issue of levying tax on the high seas - or within 12 nautical miles of the coast -  States  retain power

For entities with annual turnover above the Rs 1.5 crore threshold, the Centre and states will share control equally

claiming LTA gets complex from this year source Business standard

The  salaried  class  comes  under  more scrutiny for  claiming  LTA

Leave  Travel  allowances  are  one such  allowance  to  encourage employees  to avail part  of their holidays  expenses.

Until  now  Corporates  went by  Self  declaration  of  employees  Now  employees has  to submit  Form  12BB

What  is  form 12BB  of  Income tax  rules  12C

It  is  a statement showing particulars of claims by an employee for deduction of tax under section 192 

In  the  declaration  we  need  to  disclose  the  following  details

1)  House  Rent Allowance 

The  following  details  required for  House  Rent allowance


 (i) Rent paid to the landlord
 (ii) Name of the landlord 
(iii) Address of the landlord 
(iv) Permanent Account Number of the landlord

2) Leave  Travel  Allowance

3) Deduction  on Interest  on borrowings-  Following  details  on Interest  on borrowings  to be  disclosed.

(i) Interest payable/paid to the lender
 (ii)Name of the lender 
(iii) Address of the lender 
(iv) Permanent Account Number of the lender 
(a) Financial Institutions(if available) 
(b) Employer(if available) 
(c) Others

Deduction under Chapter VI-A (
A) Section 80C,80CCC and 80CCD 
(i) Section 80C 
(a) …………….. 
(b) …………….
. (c) …………….. 
(d) …………….. 
(e) ……………..
 (f) ……………..
 (g) ……………..
 (ii) Section 80CCC
 (iii) Section 80CCD (B) Other sections (e.g. 80E, 80G, 80TTA, etc.) under Chapter VI-A.
 (i) section………………. 
(ii) section……………….
 (iii) section………………
 (iv) section………………. 
(v) section………………. 
 
Going  by  this  declaration  the  employees  are  coming under  more scrutiny


For  more  details  read  business  standard

Saturday, January 14, 2017

Sebi tightens unlisted firms’ M&A rules source Business standard

Sebi  market  regulator  introduced  more  checks  and balances  for mergers and acquisitions involving  unlisted  companies.   Unlisted  companies  merge  with   Listed entity has to  fulfill certain conditions.

 The public shareholding of the resultant entity created by the merger of an unlisted and a listed company has to be more than 25 per cent

The  objective  to have  wider  public shareholding 

The move comes after a recent merger involving insurance companies HDFC Life and Max Life had raised questions over non-compete fees paid to the promoters of the Max group

SEBI  also  announced   that  allowing  investments in newer instruments  and  also  permitting fund houses  to use celebrities  for industry level  advertisements    The  advertisements  not  at fund houes  or scheme level


For  more  details  Business  Standard



On Clarification regarding availability of Transitional Credit for GST

On Clarification regarding availability of Transitional Credit for GST  As per the rules, the Goods and Services Tax (GST) for the month...