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Friday, November 21, 2014

TDS statement filed for Q1 but not filed Q2 FY 2014-15-TRACES

As per the records of the Centralized Processing Cell (TDS), you have filed TDS Statements for Q1, FY 2014-15, however, no TDS Statements have been filed for Quarter 2 as of November 1, 2014.

If you are not required to submit the relevant statement, you are requested to submit a declaration by taking appropriate action as suggested under "Action to be taken" in this communication. Otherwise, your urgent attention is invited to relevant CBDT Circulars and provisions of the Income Tax Act, mandating filing of TDS Statements and Issuance of TDS Certificates downloaded from TRACES.

1. Mandatory filing of TDS Statements:

Please refer to the provisions of section 200(3) of the Income Tax Act, 1961 read with Rule 31A, which reads as follows:

Every person responsible for deduction of tax under Chapter XVII-B, shall, in accordance with the provisions of sub-section (3) of section 200, deliver, or cause to be delivered, the following quarterly statements to the Director General of Income-tax (Systems) or the person authorised by the Director General of Income-tax (Systems), namely:
Statement of deduction of tax under section 192 in Form No. 24Q;
Statement of deduction of tax under sections 193 to 196D in -
Form No. 27Q in respect of the deductee who is a non-resident not being a company or a foreign company or resident 
but not ordinarily resident; and
Form No. 26Q in respect of all other deductees.
It is, therefore, advised to file the applicable TDS Statements at the earliest to comply with the above provisions.

2. Implications of Non/ Late filing of TDS Statements:

For Deductors:

In case of late filing of TDS Statements, a fee shall be levied on the deductor u/s 234E of the Act, which reads as under:

Where a person fails to deliver or cause to be delivered a statement within the time prescribed in sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C, he shall be liable to pay, by way of fee, a sum of two hundred rupees for every day during which the failure continues.
For Tax payers:

Non/ Late filing of TDS statements results into the TDS Credit not being available to the deductees. They, therefore, will not be able to claim the credit for tax already deducted from the payments made to them. Please note that TDS Certificates will not be available until the TDS Statements are duly filed

3. Actions to be taken:

Please file the relevant TDS Statement without any further delay.
If you are not required to file the same, please submit a declaration for Non-filing on TRACES. For this purpose, you can login to TRACES, navigate to "Statements/ Payments" menu and submit details under "Declaration for Non-Filing of Statements"
Issue TDS certificates after generating and downloading the same from TRACES. TDS Certificates downloaded only from TRACES Portal will be valid.

Thursday, November 20, 2014

Now you can deposit and withdraw money from same ATM machine

AXIS Bank announced launch of smart terminal which can be used both to deposit and withdrawal of money like ATM. This smart terminal is self service like ATM which deposit as well as withdraw cash for the customers.

Customers can use this smart terminal without debit or credit card and the money will be deposited instantly as it accepts the money. There is no cap in depositing money in an account as far as the customer shared PAN information with the bank.

The concept of depositing money as well as withdrawing from the same machine will be very useful for the customers as they needn’t to visit branch and stand in queue. This concept is very useful for Banks too as they needn’t refill the ATM machine so often because cash deposited will be used for cash withdrawal. Moreover there will be less rush at branches.

Speaking on the occasion, Rajiv Anand, Group Executive & Head- Retail Banking, Axis Bank, said, "Axis Bank has been a pioneer in launching customer-friendly technology initiatives in the banking space. The self-service terminal is another innovative product by the bank, which will help customers carry out all financial and non-financial transactions in a convenient and hassle-free manner."

Reasons why you should not invest in Kisan Vikas Patra KVP

Finance Minister Mr. Arun Jaitley re launched Kisan Vikas Patra after the discontinue it earlier. Kisan Vikas Patra gives annualized return of 8.7% and money is doubled in 100 months. This option to invest money is reintroduced to stop the public in investing in chit fund or ponzi scheme.
Investing in KVP is not a good option when you have many other options available. Some points are as under.

1-  KVP may be a good option where no banking facility is available. But where banking is available PPF may be the good scheme as rate of interest is almost the same of 8.5%  and offer tax benefits which are not applicable in KVP.

2-  Tax saving FDR with State Bank of India gives 8.75% annualized return compare to 8.7 in KVP. Fixed deposit has the maximum liquidity and you can break it anytime and get your money. However there is a cap of maximum 1 lakh rupees FDR compare to no upper limit in KVP.

3-  If we calculate it with inflation index, KVP is total loss for people come in to 30% tax bracket. KVP gives around 6 % return on investment after deducting tax and inflation is around 6-7 % now a days. So it left lesser money than you invested.

4-  KVP is mainly introduced for gold rush as people treats investing in gold and silver a safe and fruitful investment. Now a day’s gold and silver in red but if we see 5 tears horizon, gold and silver gave a great return compare to KVP.

Gold performance report
Percentage %
1 Month
6 Months
1 Year
5 Years
So we can see gold has given good return in 5 years tenure.

Wednesday, November 19, 2014

Features of latest relaunch of Kisan Vikas Patra

Government of India has relaunched Kisan  Vikas Patra which is the small saving scheme which was discontinued earlier hoping to lure investors away from gold and fraudulent schemes by offering attractive terms. There won't be any upper limit on investments, the minimum denomination being Rs 1,000.

Investors will be able to double their money in 100 months but the government has bundled in a number of features to enhance liquidity of the instrument as the new regime looks to raise the level of financial savings that fell to 7.1 per cent of GDP in FY13 from more than 12 per cent in FY10.

There are many features of new Kisan Vikas Patra which are as under.

 1- The Kisan Vikas Patra shall be issued in denominations of Rs. 1,000/-, Rs. 5,000/-, Rs.10,000/- and Rs. 50,000/-. 

2- Money will be doubled in 100 Months in KVP certificates.

3- Purchase of Certificate.—Any number of Certificates of the denominations specified in rule 4 may be purchased. 

4- KVP can be purchased as a single holder or joint holder names.

5- A single holder type certificate may be issued to an adult for himself or on behalf of a minor or to a minor.

6- An application In Form A to be submitted in post office or bank to purchase the KVP certificate.

7- Payment can be made in cash, cheque or withdrawl form attaching pass book of saving account in the bank.

8- Certificates will be issued immediately on receiving the payment. However in the case of cheques or pay order, certificate will be issued only after realization.

9- A provisional receipt will be given if no certificate issued in any case which can be later exchanged with the certificates.

10- KVP is transferrable from post office to bank and vice versa.

11- Certificate can be transferred from one person to another in death, joint to single name, single to joint name or any court order etc.

12- No transfer shall be permitted in respect of a Certificate held by or on behalf of a minor till the minor is alive. 

13- Nomination is must in single holder account.

14- Simple interest rate will be given after maturity of certificates.

15- Duplicate certificates can be issued in case of lost certificates.

16- Maturity time is 8 years and 4 Months of KVP certificates.

17- KVP certificate investment is eligible for 80C deduction under income tax act.
Download Full government notification on Kisan Vikas patra

Custom duty drawback rates for all industries effective from 22 November 2014

Custom department revised all industries custom drawback duty rates. These rates are effective from 22 November 2014. Custom department issued a circular no. 13/2014 dated 18 November 2014 regarding new custom drawback duty rates. Full circular is as under.

 The Ministry has notified revised All Industry Rates (AIR) of Duty Drawback vide Notification 
No. 110/2014- Customs (N.T.), dated 17.11.2014. This notification comes into force on 22.11.2014.

2. Some of the broad aspects, from amongst the changes notified with respect to AIR of duty drawback and entries in the Schedule, are the following –

(a) As before, the drawback rates have been determined on the basis of certain broad average parameters including, inter alia, prevailing prices of inputs, input output norms, share of imports
in input consumption, the applied rates of central excise and customs duties, the factoring of incidence of service tax paid on taxable services which are used as input services in the 
manufacturing or processing of export goods, factoring incidence of duty on HSD/furnace oil, 
value of export goods, etc. 

(b) Many items already covered under the Drawback Schedule prior to incorporation of erstwhile 
DEPB items, shall see a change in the AIR. In continuation of a transitory arrangement, for the 
items incorporated in the drawback schedule from the erstwhile DEPB Scheme there is a 
reduction in the AIR.

(c) Drawback caps continue on most tariff items with AIRs above 2%. The caps have been 
revised. At rates below 2% there is cap with respect to guar gum and frozen marine products. 

(d) Further, in the case of project exports, where export product is accompanied with ARE-1 and for which no drawback cap has been prescribed in the Schedule, the Note/Condition (6) in the AIR notification now specifies a cap. It has been provided that such cases shall be declared by the exporter and the maximum amount of drawback that can be availed under the Schedule shall not exceed the amount calculated by applying the ad valorem rate of drawback to one and half times the ARE-1 value. In such cases, before Let Export Order is made, the relevant ARE-1 value (s) are to be recorded in the “Departmental Comments” field which is to be also taken into account at the subsequent stage of drawback processing.2

(e) Several entries have been rationalized by merging them at respective four digit level or under the respective residuary sub-heading ‘others’. Tariff item numbers have seen a change in many cases. 

(f) The hitherto residuary rate of 1% (composite) and 0.3% (Customs) is changed to 1% (composite) and 0.15% (Customs). Further existing residuary rates of 1.3% and 1.7%, have been increased to 1.4% and 1.9%, respectively, with some exceptions.

(g) In chapter 57, the six digit tariff item (TI) under 5705 have been changed to refer to the composition of fibre as is under other four digit tariff items. Further, all caps have been madeon the basis of per instead of earlier per kg (for some items) in the chapter. 

(h) Several entries have been modified /amended to address issues brought to Ministry’s notice. 
Laptop bags and shopping bags have been specifically mentioned at six digit level below TI 
4202. ‘Cami’ has been included with women’s/girl’s tops in TI 611402 and 621102; ‘three fourth 
pants’ along with ‘capris’ included in TI 610302, 610402, 620302, and 620402; and ‘leggings” included in TI 610402. An entry for ‘other jackets’ below TI 6114 and 6211 has been made. 

Mountain terrain bicycles have been specified against TI 871203. Cricket bats made from English willow (TI 9506) have been distinguished from other cricket bats.

(i) Separate entries have been created distinguishing certain export products such as cotton yarn of less than 50 counts or 50 or more counts (Chapter 52); core spun cotton yarn containing 3% or more of lycra /spandex/ elastane (TI 5205); flame retardant fabric treated with organic phosphorous compound (TI 5209); knotted/tufted woolen /fine animal hair carpets containing 15% or more by weight of silk (TI 5701, 5703); embroidery in the piece, in strips or in motifs, of flax/linen (TI 5810); cotton blankets (TI 6301); leather safety footwear with protective toe caps of composite/synthetic material (TI 6403); glass artware/handicraft made out of two or more ply glass with or without metallic fusion (TI 7020); delivery tricycles/cycle rickshaws (TI 8712); specified electrical apparatus, of aluminium (TI 8536) and parts of aluminium for specified electrical apparatus (TI 8538). 

(j) AIR has been provided to calcined kaolin packed in HDPE/ LDPE/ PP bags (TI 2507), umbrellas, etc. of Chapter 66 and artificial flowers, etc. (TI 6702). Composite rate of 7% has been provided for all agricultural machinery etc. of TI 8432.

(k) AIR has been fixed as Rs. 219.9/gm for gold jewellery /parts and Rs. 3112.5/kg for silver jewellery /articles. Guar Gum has been provided ad valorem rate (composite) of 0.75% with a cap of Rs. 1270 per MT.

(l) Note/Condition (20) in the AIR Notification specifies that “shirts” shall include “shirts with hoods”. Similarly, Note (25) specifies that “vehicles” of Chapter 87 shall comprise completely 
built unit or completely knocked down (CKD) unit or semi knocked down (SKD) unit.

3. It has been made explicit that where the claim for duty drawback is filed with reference to the rate in the AIR Schedule, an application for fixation of Brand Rate under Rule 7 of the Customs, Central 
Excise Duties and Service Tax Drawback Rules, 1995 shall not be admissible. For this, para 2 of the 
Notification and amendment to the said Rule vide Notification No.109/2014-Customs (N.T.) dated 17.11.2014 may be referred. 

4. In this context, it is also clarified that the exporters opting for claim of brand rate shall declare the 
figure “9801” as an identifier in the shipping bill under the Drawback Details on basis of which they may subsequently apply to Central Excise for determination of brand rate. The Commissioners of Central Excise shall facilitate such exporters in terms of paras 5A-5C of Instruction No. 603/01/2011-DBK dated 11.10.2013 with, interalia, the grant of provisional brand letters.

5. The Commissioners are expected to ensure that the due diligence is exercised to prevent any 
misuse. As before, it may be ensured that exporters do not avail of the refund of service tax paid on taxable services which are used as input services in the manufacturing or processing of export goods through any other mechanism while claiming AIR. Moreover, there is need for continued scrutiny for preventing any excess drawback arising from mismatch of declarations made in the Item Details and the Drawback Details in a shipping bill. Also, in case of claim of the composite (higher) rate of AIR, the processing at the time of export should specifically ensure availability of ‘Non-availment of Cenvat certificate’ etc at that stage itself.

6. It is requested to download the notifications from the Board’s website ( and carefully peruse them and thereby take note of all the specific changes notified. 

7. With trade facilitation in view, tenure of the Drawback Committee constituted by Central Government has been temporarily extended. Therefore, if any inconsistency or error is noticed or difficulty faced, the Board may be apprised so that the appropriate action can be initiated.

8. Suitable public notice and standing order may also be issued for guidance of the trade and officers.

Central excise clarification about availment of CENVAT credit after 6 monts

Central excise department issued a clarification regarding availment of CENVAT credit after 6 months with a circular no. 990/14/2014 dated 19 November 2014. Full circular is as under.

Attention is invited to the Notification of the Government of India in the Ministry of Finance, Department of Revenue No. 21/2014-CE (NT) dated 11.07.2014, vide which, inter alia, amendment was made in Rule 4(1) and 4(7) of CENVAT Credit Rules, 2004 (CCR, 2004) to prescribe that manufacturer or output service provider shall not take CENVAT credit after six months of the date of issue of any of the documents specified in sub-rule (1) of Rule 9.

2.     Concerns have been expressed by trade that in view of above changes, the re-credit taken in following three situations may be hit by the time limit of six months prescribed:

 i.    3rd proviso to Rule 4(7) of CCR, 2004 prescribes that if the payment of value of input service and service tax payable is not made within three months of date of invoice, bill or challan, then the CENVAT Credit availed is required to be paid back by the manufacturer or service provider. Subsequently, when such payment of value of input service and service tax is made, the amount so paid back can be re-credited.

 ii.   According to Rule 3(5B) of CCR, 2004, if the value of any input or capital goods before being put to use on which CENVAT Credit has been taken, is written off or such provisions made in Books of Account, the manufacturer or service provider is required to pay an amount equal to credit so taken. However, when the inputs or capital goods are subsequently used, the amount so paid can be re-credited in the account.

 iii.   Rule 4(5)(a) of CCR, 2004 prescribes that in case inputs sent to job worker are not received back within 180 days, the manufacturer or service provider is required to pay an amount equal to credit taken on such inputs in the first instance. However, when the inputs are subsequently received back from job worker, the amount so paid can be re-credited in the account.

3.      The matter has been examined. The purpose of the amendment made by Notification No. 21/2014-CE (NT) dated 11.07.2014 is to ensure that after the issue of a document under sub-rule (1) of Rule 9, credit is taken for the first time within six months of the issue of the document. Once this condition is met, the limitation has no further application. It is, therefore, clarified that in each of the three situations described above pertaining to Rule 4(7), Rule 3(5B) or Rule 4(5) (a) of CCR, 2004, the limitation of six months would apply when the credit is taken for the first time on an eligible document. It would not apply for taking re-credit of amount reversed, after meeting the conditions prescribed in these rules

4.      Difficulties faced, if any, in implementation of this Circular may be brought to the notice of the Board. Hindi version follows.

Tuesday, November 18, 2014

5 Reasons why credit card in better than cash

Credit cards concept is still mystery for Indians and many of us hate credit cards. People think it can lead to a trouble with cyber fraud or using in wrong ways. But using credit card rationally will be very useful in many circumstances compare to bring cash and paying in cash. These are 5 ways where using credit card will be very useful.

 1. Ease in travelling: Imagine you are travelling abroad. You want to buy an expensive gift for your wife, let’s say a diamond ring, which could run into some $1,000, which is around Rs 60,000. Would you carry that much cash in a foreign country? If you had planned to withdraw cash from your bank account, think again. Does your debit card allow you to withdraw that much cash? No. Every bank sets limit over debit card swipes and withdrawal limits in a single day. A credit card is a clear winner in this case.

2. After you lose it? What will you do after you lose money or it is stolen? Do you think it can be replaced? Your credit card can be replaced after it is lost or stolen. Yes, it comes at a nominal cost, but still there is scope to replace it, but when it comes to cash? No way.

3. Build or repair your credit score: No, it is not like what you thought. Cash transactions and debit card transactions are not reported to Credit Information Bureau of India Limit (Cibil) and other credit bureaus. So, you cannot build your Cibilcredit score based on debit card usage. A credit card is any day convenient way to build your Cibil score or repair your damaged score. Credit card usage is a manifestation of your credit behavior and also your credit card repayment pattern shows if you are following financial discipline scrupulously.

4. Rewards: Using a credit card can be rewarding if used wisely. Credit card companies or banks issuing these cards have tie-ups with top retailers, e-commerce websites, e-ticketing websites, malls, restaurants, cinema houses, etc. The more you spend on your credit cards the more points you can collect that can be later redeemed from the wide range of offerings. However, just to collect points one must not spend an amount one can’t repay to the lender. Can you think of any such rewards or freebies by spending cash?

5. Anything else? These days credit limit on credit cards easily touch Rs 50,000 to Rs 1,00,000. That is how much you can buy from your credit card. Imagine carrying around that much cash? Moreover, sometime when you are extremely cash strapped you can just pay the minimum amount due on your credit card and keep sailing. Please make sure that you chose this option as one off instance and not a regular practice.

Hence, it is important to understand that the only advantage, cash offers is controlling spends. If you are one of those who do not overspend, we advise you to get yourself a credit card. It will open up a whole new world of benefits.