Apr 30, 2015

Excise rebate of duty on goods cleared from DTA to SEZ

4:24 PM 0
Excise rebate of duty on goods cleared from DTA to SEZ
Central Excise department issued a clarification on rebate on duty on goods cleared from DTA to SEZ. Central excise department issued a circular no. 1001/2015 dated 28 April 2015. Full circular is as under.

Kind attention is invited to Notifications No. 6/2015-CE (NT) and 8/2015-CE (NT), both dated 01.03.2015, vide which the meaning of export has been elaborated in both rule 5 of CENVAT Credit Rules, 2004 and rule 18 of Central Excise Rules, 2002.  Post these amendments, apprehensions have been expressed by the trade as to whether the following benefits would be available after these amendments:

                              i.                Benefit of rebate of duty on goods cleared from DTA to SEZ.
                             ii.                Refund of accumulated CENVAT credit when goods are cleared from DTA to SEZ.

2.    It is seen that:

                              i.                Section 2 (m) (ii) of the SEZ Act, 2005 defines export to, inter-alia, mean “supplying goods,   or providing services, from the Domestic Tariff Area to a Unit or Developer”.

                             ii.                Section 26 (1) (d) of SEZ Act, 2005 mentions that subject to the provisions of the sub-section (2), every Developer and entrepreneur shall be entitled to drawback or such other benefits as may be admissible from time to time on goods brought or services provided from the Domestic Tariff Area into Special Economic Zone or Unit or services provided in a Special Economic Zone or Unit by the service providers located outside India to carry on the authorized operations by the Developer or entrepreneur.

                            iii.                Section 51 (1) of the SEZ Act mandates that “The Provisions of this Act shall have effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law other than this Act”.

                            iv.                Section 53 (1) of the SEZ Act mentions that “A Special Economic Zone shall, on and from the appointed day, be deemed to be a territory outside the customs territory of India for the purposes of undertaking the authorized operations”.


                             v.                Rule 30 (1) of the SEZ Rules, 2006 reads as under-

“The Domestic Tariff Area supplier supplying goods to a Unit or Developer shall clear the goods, as in the case of exports, either under bond or as duty paid goods under claim of rebate on the cover of ARE-1 referred to in Notification number 42/2001-Central Excise (NT) dated the 26th June, 2001 in quintuplicate bearing running serial number beginning from the first day of the financial year”.

3.    It can thus be seen that according to the SEZ Act, supply of goods from DTA to the SEZ constitutes export.  Further, as per section 51 of the SEZ Act, the provisions of the SEZ Act shall have over riding effect over provisions of any other law in case of any inconsistency.  Section 53 of the SEZ Act makes an SEZ a territory outside the customs territory of India.  It is in line of these provisions that rule 30 (1) of the SEZ rules, 2006 provides that the DTA supplier supplying goods to the SEZ shall clear the goods either under bond or as duty paid goods under claim of rebate on the cover of ARE-1.

4.    It was in view of these provisions that the DGEP vide circulars No. 29/2006-customs dated 27/12/2006 and No. 6/2010 dated 19/03/2010 clarified that rebate under rule 18 of the Central Excise Rules, 2002 is admissible for supply of goods made from DTA to SEZ.  The position as explained in there circulars does not change after amendments made vide Notification No. 6/2015-CE (NT) and 8/2015-CE (NT) both dated 01.03.2015, since the definition of export, already given in rule 18 of Central Excise Rules, 2002 has only been made more explicit by incorporating the definition of export as given in the Customs Act, 1962.  Since SEZ is deemed to be outside the Customs territory of India, any licit clearances of goods to an SEZ from the DTA will continue to be export and therefore be entitled to the benefit of rebate under rule 18 of CER, 2002 and of refund of accumulated CENVAT credit under rule 5 of CCR, 2004, as the case may be.

5.    Any difficulty in the implementation of this circular may be brought to the notice of the Board. Hindi version will follow.

Apr 27, 2015

TRACES advice on closure of short payment TDS defaults

11:05 PM 1
TRACES advice on closure of short payment TDS defaults
As per the records of Centralized Processing Cell (TDS), there are outstanding Short Payment Defaults exceeding Rs. 1 Crore, with respect to TDS Statements filed by you since Financial Year 2007-08 onwards.


Immediate Attention:
Online Correction facility at TRACES should be used for closure of Short Payment defaults. CPC (TDS) processes such statements within 24 hours of submission of such corrections.

To facilitate non-intrusive TDS Compliance, Short Payment Defaults ought to be closed at the time of submitting requests to download Conso Files and TDS Certificates from the web portal TRACES.

Since the due date for Q4 filing of TDS statements and subsequent distribution of TDS Certificates is approaching fast, you are requested to close the above defaults without any further loss of time.

Consequences of failure to pay the demand:
As per the provisions of section 220 of the Act, Any amount, specified as payable in a notice of demand shall be paid within thirty days of the service of the notice.

If the amount specified in any notice of demand is not paid within the period limited under sub-section (1), the assessee shall be liable to pay simple interest at one per cent for every month or part of a month comprised in the period commencing from the day immediately following the end of the period mentioned in sub-section (1) and ending with the day on which the amount is paid.

If any person fails to deduct or pay the whole or any part of the tax, then, such person shall be liable to pay, by way of penalty, a sum equal to the amount of tax which such person failed to deduct or pay under Section 271C of the Act.

Failure to pay tax to the credit of Central Government is punishable with fine as per the provisions of section 276B/ 276BB.

Section 278A of the Act prescribes for punishment for second and subsequent offences, if any person has been convicted of an offence under section 276B.

Action to be taken:
Use Challan ITNS 281 to pay the demand with your relevant Banker, if there are no challans available for consumption. Please wait for 2/3 days for the challan to be updated with TRACES.

Please download the Justification Report from our portal TRACES to view your latest outstanding demand.

Please use the Online Corrections facility on TRACES to submit corrections, to payoff/ close the demand.

To avail the facility, please Login to TRACES and navigate to Defaults tab to locate Request for Correction from the drop-down list. You can refer to our e-tutorials for necessary help.

In case of Short Payment Defaults due to Unmatched Challans, please use Tag Unmatched Challan facility using Online Corrections.

In case of Short Payment Defaults due to Insufficient Challans, please use Move Deductee facility using Online Corrections. With use of this feature, a portion of the Deductee Rows can now be moved to any other Unconsumed OLTAS challan with adequate balance.

For any further assistance, you can also write to ContactUs@tdscpc.gov.in or call our toll-free number 1800 103 0344.
CPC (TDS) is committed to provide best possible services to you.

Above 2 CRORE

As per the records of Centralized Processing Cell (TDS),there are outstanding Short Payment Defaults exceeding Rs. 2 Crore, with respect to TDS Statements filed by you since Financial Year 2007-08 onwards.

Immediate Attention:
Online Correction facility at TRACES should be used for closure of Short Payment defaults. CPC (TDS) processes such statements within 24 hours of submission of such corrections.

To facilitate non-intrusive TDS Compliance, Short Payment Defaults ought to be closed at the time of submitting requests to download Conso Files and TDS Certificates from the web portal TRACES.

Since the due date for Q4 filing of TDS statements and subsequent distribution of TDS Certificates is approaching fast, you are requested to close the above defaults without any further loss of time.

Consequences of failure to pay the demand:
As per the provisions of section 220 of the Act, Any amount, specified as payable in a notice of demand shall be paid within thirty days of the service of the notice.

If the amount specified in any notice of demand is not paid within the period limited under sub-section (1), the assessee shall be liable to pay simple interest at one per cent for every month or part of a month comprised in the period commencing from the day immediately following the end of the period mentioned in sub-section (1) and ending with the day on which the amount is paid.

If any person fails to deduct or pay the whole or any part of the tax, then, such person shall be liable to pay, by way of penalty, a sum equal to the amount of tax which such person failed to deduct or pay under Section 271C of the Act.

Failure to pay tax to the credit of Central Government is punishable with fine as per the provisions of section 276B/ 276BB.

Section 278A of the Act prescribes for punishment for second and subsequent offences, if any person has been convicted of an offence under section 276B.

Action to be taken:
Use Challan ITNS 281 to pay the demand with your relevant Banker, if there are no challans available for consumption. Please wait for 2/3 days for the challan to be updated with TRACES.

Please download the Justification Report from our portal TRACES to view your latest outstanding demand.

Please use the Online Corrections facility on TRACES to submit corrections, to payoff/ close the demand.

To avail the facility, please Login to TRACES and navigate to Defaults tab to locate Request for Correction from the drop-down list. You can refer to our e-tutorials for necessary help.

In case of Short Payment Defaults due to Unmatched Challans, please use Tag Unmatched Challan facility using Online Corrections.

In case of Short Payment Defaults due to Insufficient Challans, please use Move Deductee facility using Online Corrections. With use of this feature, a portion of the Deductee Rows can now be moved to any other Unconsumed OLTAS challan with adequate balance.

Above 3 CRORE
 As per the records of Centralized Processing Cell (TDS),there are outstanding Short Payment Defaults exceeding Rs. 3 Crore, with respect to TDS Statements filed by you since Financial Year 2007-08 onwards.


Immediate Attention:
Online Correction facility at TRACES should be used for closure of Short Payment defaults. CPC (TDS) processes such statements within 24 hours of submission of such corrections.

To facilitate non-intrusive TDS Compliance, Short Payment Defaults ought to be closed at the time of submitting requests to download Conso Files and TDS Certificates from the web portal TRACES.

Since the due date for Q4 filing of TDS statements and subsequent distribution of TDS Certificates is approaching fast, you are requested to close the above defaults without any further loss of time.

Consequences of failure to pay the demand:
As per the provisions of section 220 of the Act, Any amount, specified as payable in a notice of demand shall be paid within thirty days of the service of the notice.

If the amount specified in any notice of demand is not paid within the period limited under sub-section (1), the assessee shall be liable to pay simple interest at one per cent for every month or part of a month comprised in the period commencing from the day immediately following the end of the period mentioned in sub-section (1) and ending with the day on which the amount is paid.

If any person fails to deduct or pay the whole or any part of the tax, then, such person shall be liable to pay, by way of penalty, a sum equal to the amount of tax which such person failed to deduct or pay under Section 271C of the Act.

Failure to pay tax to the credit of Central Government is punishable with fine as per the provisions of section 276B/ 276BB.

Section 278A of the Act prescribes for punishment for second and subsequent offences, if any person has been convicted of an offence under section 276B.

Action to be taken:
Use Challan ITNS 281 to pay the demand with your relevant Banker, if there are no challans available for consumption. Please wait for 2/3 days for the challan to be updated with TRACES.

Please download the Justification Report from our portal TRACES to view your latest outstanding demand.

Please use the Online Corrections facility on TRACES to submit corrections, to payoff/ close the demand.

To avail the facility, please Login to TRACES and navigate to Defaults tab to locate Request for Correction from the drop-down list. You can refer to our e-tutorials for necessary help.

In case of Short Payment Defaults due to Unmatched Challans, please use Tag Unmatched Challan facility using Online Corrections.

In case of Short Payment Defaults due to Insufficient Challans, please use Move Deductee facility using Online Corrections. With use of this feature, a portion of the Deductee Rows can now be moved to any other Unconsumed OLTAS challan with adequate balance.

TRACES communication on inappropriate use of digital signature for TRACES service

11:00 PM 0
TRACES communication on inappropriate use of digital signature for TRACES service
As per the records of Centralized Processing Cell (TDS), it has been observed that Online Corrections have been submitted by you on TRACES by using Digital Signature Certificate. However, there are no Registered Digital Signature Certificates (DSC) available currently in your profile.


Immediate Attention:
The Centralized Processing Cell (TDS) has provisioned for use of Digital Signature Certificate (DSC) on its web-portal TRACES for availing various services offered by the portal. As per Section 204 read with Section 200 of the Income Tax Act, 1961 and other relevant provisions for deduction of tax �Authorized Person� is referred to as �Person Responsible�.

TRACES has provided facility for Admin to facilitate authorized Sub-users to carry out activities on TRACES and submit to the Admin user. The Admin user has the rights to approve the activities using the DSC.

For availing above services, only the DSC of the �Person Responsible�, as appearing in the �Profile� of the Deductor on TRACES, should be used.

However, the system log evidences that:

The PAN of the Authorized Person was changed to a PAN belonging to a person other than the Authorized Person 

The DSC of such person has been used to submit Online Corrections and 

After completing the transaction, the PAN has later been reverted back to that of the Person Responsible, which does not have a DSC. 

Digital Signature means authentication of any TDS electronic record. It keeps record of the person who is availing the facility. Use of Digital Signature should be made with due caution. Sharing of DSC by any person would also be liable for consequences. In accordance with the Information Technology Act, 2000, every subscriber is require to retain control of the private key corresponding to the public key listed in his Digital Signature Certificate to prevent its disclosure. 

It is therefore, advised to refrain from using the Digital Signature of any person other than the Authorized Person appointed by the deductor, for carrying out any activity on TRACES.
CPC (TDS) is committed to provide best possible services to you.

Apr 25, 2015

Highlights of Pradhan Mantri Jeewan Jyoti Bima Yojana

6:11 PM 0
Highlights of Pradhan Mantri Jeewan Jyoti Bima Yojana
The Finance Minister Mr. Arun Jaitley purposed ttwo main social security schemes in insurance sector. These scheme announced as under.

1- Pradhan Mantri Jeewan Jyoti Bima Yojana
2- Pradhan Mantri suraksha Bima Yojana

Highlights of Pradhan Mantri Jeewan Jyoti Bima Yojana are as under.

Eligibility: Available to people in the age group of 18 to 50 and having a bank account. People who join the scheme before completing 50 years can, however, continue to have the risk of life cover up to the age of 55 years subject to payment of premium.

Premium:  Rs.330 per annum.  It will be auto-debited in one instalment.

Payment Mode:  The payment of premium will be directly auto-debited by the bank from the subscribers account.

Risk Coverage: Rs.2 Lakh in case of death for any reason.

Terms of Risk Coverage: A person has to opt for the scheme every year.  He can also prefer to give a long-term option of continuing, in which case his account will be auto-debited every year by the bank.

Who will implement this Scheme?: The scheme will be offered by Life Insurance Corporation and all other life insurers who are willing to join the scheme and tie-up with banks for this purpose.

Government Contribution:
(i)       Various other Ministries can co-contribute premium for various categories of their beneficiaries out of their budget or out of Public Welfare Fund created in this budget out of unclaimed money.  This will be decided separately during the year.

(ii)     Common Publicity Expenditure will be borne by Government.
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Highlights of Pradhan Mantri Suraksha Bima Yojana

6:06 PM 0
Highlights of Pradhan Mantri Suraksha Bima Yojana
The Finance Minister announced two major social security scheme in his budget speech. They are Pradhan Mantri Suraksha Bima Yojana
Pradhan Mantri Jeewan Jyoti Bima Yojana

Major highlights of these two insurance sector social schemes are as under.

Eligibility: Available to people in age group 18 to 70 years with bank account.

Premium:  Rs.12 per annum.

Payment Mode: The premium will be directly auto-debited by the bank from the subscribers account. This is the only mode available.

Risk Coverage:  For accidental death and full disability - Rs.2 Lakh and for partial disability – Rs.1 Lakh.

Eligibility: Any person having a bank account and Aadhaar number linked to the bank account can give a simple form to the bank every year before 1st of June in order to join the scheme.  Name of nominee to be given in the form.

Terms of Risk Coverage: A person has to opt for the scheme every year. He can also prefer to give a long-term option of continuing in which case his account will be auto-debited every year by the bank.
Who will implement this Scheme?: The scheme will be offered by all Public Sector General Insurance Companies and all other insurers who are willing to join the scheme and tie-up with banks for this purpose.

Government Contribution:
(i)       Various Ministries can co-contribute premium for various categories of their beneficiaries from their budget or from Public Welfare Fund created in this budget from unclaimed money. This will be decided separately during the year.

(ii)     Common Publicity Expenditure will be borne by the Government.

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Apr 24, 2015

No TDS on premature PPF withdraw

6:00 PM 0
No TDS on premature PPF withdraw
While the Modi government is allaying perceptions of tax terrorism among foreign investors and projecting a pro-poor stand to counter opposition allegations, a peculiar clause in the Finance Bill can undo its efforts as it brings the retirement savings of millions of workers under the income tax net, even if they earn as little as Rs 2,120 a month.

To put that in perspective, the annual income threshold above which personal income tax is payable is Rs 2.5 lakh or about Rs 21,000 per month. 

From June 1, workers' retirement savings exceeding Rs 30,000 will be taxed at 10.3% or the maximum marginal rate of 30.6% if they leave the employees' provident fund before completing five years of service.

Tax will be deducted at the highest rate from the provident fund account balances of such employees who don't have a PAN card, used to identify taxpayers, according to the new Section 192A introduced in the Income Tax Act. Even those with a PAN card who save a higher amount and pay income tax will need to refile their past tax returns where deductions were claimed against EPF contributions.

Alarmed officials in the PF office said that 90% of the Employees' Provident Fund Organisation's 8.5 crore-plus members don't have PAN cards and would end up paying an "exorbitant and unfair" tax on their savings. The EPFO board chaired by labour and employment minister Bandaru Dattatreya took up the issue with the finance ministry last month. 

However, officials said there is no move yet to reconsider the issue, in contrast to the alacrity with which the finance ministry announced a review of new I-T return forms that sought details of foreign travel and attracted severe flak.

"A vast majority of EPF members may not have a PAN card. The charging of income tax in respect of such members at the maximum marginal rate will be exorbitant and unfair," Central Provident Fund Commissioner KK Jalan noted in a missive to the labour ministry   on the issue last month.

Drawing a parallel between another provision in the Finance Bill that makes quoting of PAN necessary for purchasing jewellery over Rs 1 lakh, the PF department has asked for 'the same logic' to be applied to EPF members so that workers are not subject to unnecessary hassles. 
 An EPF account is mandatory for all employees earning up to Rs 15,000 per month (raised recently from Rs 6,500 per month) in firms employing over 20 workers. As per the law, 24% of an employee's salary is diverted to her or his PF account as a social security net for old age.

The Rs 30,000 threshold set in the Finance Bill for deducting tax from the PF balance implies that tax would be payable on contributions of as little as Rs 508 to the EPF every month for up to 59 months. The retirement savings of those earning over Rs 2,120 a month could be taxed at 30.9% if they don't have a PAN card.

"The EPFO provides social security to employees who are mainly from the lower income strata of the society. In majority of the cases, the yearly income of these employees would be less than the exemption limit prescribed in the Income Tax Act and therefore, may not be required to pay tax at all," Jalan pointed out, adding that the Rs 30,000 tax-free limit on such PF balances is 'too low'.

Unlike banks that deduct income tax at 10.3% on interest income of over Rs 10,000 earned from fixed deposits, the provisions for taxing PF accounts envisage taxing the principal amount (EPF contributions) as well as the interest earned (annual dividend credits). In cases where a depositor hasn't shared his PAN card details with the bank; such interest income is taxed at 20.6%. 

 In contrast, the finance ministry has asked the EPFO to levy the highest possible tax rate for those who don't hold PAN cards, if their accumulated PF savings are Rs 30,000 or more. Once tax is deducted from those who don't have a PAN card, they are required to submit different forms to the income tax department (Forms 15G, 15H and 60).

"Filling such forms would add to woes of EPF subscribers and more so when it is the avowed policy of the present government to move towards an era of paperless offices," Jalan wrote in his letter to Labour Secretary Shankar Aggarwal, pleading for the matter to be taken up with the finance ministry, "keeping in view the financial interests" of workers. 
Source: Economics Times

No TDS deduction whose income is exempt u/s 10(26BBB)

3:31 PM 0
No TDS deduction whose income is exempt u/s 10(26BBB)
CBDT issued a circular no. 7 dated 23 April 2015 about Requirement of tax deduction at source in case of corporations whose income is exempt under section 10 (26131313) of the income-tax Act, 1961. Full circular is as under.

 The Central Board of Direct Taxes (the Board) had earlier issued Circular No.4/2002 dated 16.07.2002 which laid down that in case. of such entities, whose income is unconditionally exempt under section 10 of the Income-tax Act (the Act) and who are statutorily not required to file return of income as per section 139 of the Act, there would be no requirement for tax deduction at source (TD) from the payments made to them since their income is anyway exempt under the Act. 

2. Section 10(26BBB) came into existence after the issue of the said Circular dated 16.07.2002. The said section was inserted in the Income-tax Act vide Finance Act, 2003 (w.e.f. 01.04.2004) unconditionally exempting any income of a corporation established by. a Central, State or Provincial Act for the welfare and economic upliftrnent of ex-servicemen being the citizens of India. The corporations covered under section 10(26BBB) are also statutorily not required to file return of income as per section 139 of the Act. References have been received in the Board requesting for extension of the aforesaid exemption from TDS granted vide Circular No.4/2002 to the corporations covered under section 10(26BBB) as well. 

3. The matter has been examined by the Board. It has now been decided that since the corporations covered under section 10(26BBB) satisfy the two conditions of Circular No.4/2002 i.e. unconditional exemption of income under section 10 and no statutory liability to file return of income under section 139, any corporation whose income is exempt under section 10 (26BBB) of the Act will also be entitled to the benefit of the said Circular. Hence there would be no requirement for tax deduction at source from the payments made to such corporations since their income is anyway exempt  under the Act. 

Apr 23, 2015

Latest FVU version 4.6 e-TDS software free download

5:06 PM 0
Latest FVU version 4.6 e-TDS software free download
Tin.nsdl has issued latest file validation utility FVU version 4.6 e-tds software. This fvu version 4.6 is applicable with effect from 21 April 2015. There are many new features added in the latest FVU version 4.6 which are as under.

Quoting of PAN of responsible person for deducting/ collecting tax.

Quoting of AIN mandatory only if the TDS/TCS has been deposited by book entry i.e., through transfer voucher.

Quoting of BIN details mandatory only for the statements pertaining to FY 2013-14 onwards.

Update of tax deposit amount in deductee details enabled for the deductee records where tax has been deducted at higher rate.

Reduction in the applicable list of “Nature of Remittances” (Applicable in case of Form no. 27Q).

Enhancement of deduction allowed under section 80CCE from Rs. 1,00,000/- to Rs. 1,50,000/-.

This version of FVU will be applicable with effect from April 21, 2015

Download Latest FVU 4.6
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Latest RPU version 4.3 for E-TDS statement free download

5:06 PM 0
Latest RPU version 4.3 for E-TDS statement free download
Tin.nsdl has launched latest return preparation utility RPU version 4.3 for e-tds statement. This is the latest RPU version issued on 22 April 2015. There are many new features added in latest rpu 4.3 which are as under.

Quoting of PAN of responsible person for deducting/ collecting tax.

Quoting of AIN mandatory only if the TDS/TCS has been deposited by book entry i.e., through transfer voucher.

Quoting of BIN mandatory only for the statements pertaining to FY 2013-14 onwards.

Update of tax deposit amount in deductee details enabled for the deductee records where tax has been deducted at higher rate.

Reduction in the applicable list of “Nature of Remittances” (Applicable in case of Form no. 27Q).

Enhancement of deduction allowed under section 80CCE from Rs. 1,00,000/- to Rs. 1,50,000/-.

Incorporation of latest File Validation Utility (FVU) version 4.6 (applicable for TDS/TCS statements pertaining to FY 2010-11 onwards) and FVU version 2.142 (applicable for TDS/TCS statements upto FY 2009-10).


Download RPU version 4.3
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Salient changes in DFIA and EPCG scheme in foreign trade policy

4:19 PM 0
Salient changes in DFIA and EPCG scheme in foreign trade policy
Ministry of finance issued a circular no. 14/2015 dated 20 April 2015 about Foreign Trade Policy 2015 - 2020 –Salient changes in Schemes of reward or incentive / advance authorization or DFIA / EPCG or post export EPCG. Full circular is as under.

The Central Government has notified the Foreign Trade Policy (FTP), 2015 - 20 (Policy, for short) on 1.4.2015 and the DGFT has simultaneously issued public notices for the related Handbook of Procedures (HBP) and Appendices and ANF. These documents may be perused for details.

2.         Insofar as the schemes of reward or incentive / advance authorization or DFIA / EPCG or post export EPCG are concerned, the Customs, Central Excise and Service Tax notifications have been issued for the purposes of implementing the Policy/HBP. These may also be perused for details. The succeeding paragraphs mention salient features of the changes in these Schemes.

Reward/Incentive Schemes

3.         Reward in the form of duty credit shall be issued by the DGFT to service providers of notified services located in India under the Service Exports from India Scheme (SEIS) or to export of notified goods (including from SEZs) to notified markets / countries under the Merchandise Exports from India Scheme (MEIS) of the Policy. The MEIS includes reward on specified items that are transacted using e-commerce platforms when their export is made through foreign post offices/courier terminals at Chennai, Delhi and Mumbai for which procedures to be adopted shall be issued separately by concerned wings of CBEC.

4.         Simplifications from earlier schemes include that both SEIS and MEIS reward duty credits are freely transferable and may be used to debit customs duty on import of any goods (except appendix 3A items), debit service tax on procurement of services or debit central excise duty on domestic procurement of excisable goods (without exception for appendix 3A items); the basic customs duty debited in SEIS/MEIS duty credit may also be allowed as drawback. The notification Nos. 24 & 25/2015-Customs, 20 & 21/2015-Central Excise and 10 & 11/2015- Service Tax all dated 08.04.2015 may be referred in this regard.

5.         The Policy HBP para 3.14 relating to declaration of intent for reward on goods requires the exporter to, for shipping bills filed from 1.6.2015 onwards, mandatorily declare intent for rewards on shipping bill. Till then, the present position of mandatory declaration for certain shipping bills would continue. The changed position shall enable Customs to take more informed decisions.

Advance Authorization & DFIA schemes

6.         The Policy has now provided for exemption from the transitional product specific safeguard duty of section 8C of CTA 1975. Advance Authorization for Annual Requirement has been restricted to cases of standardised norms (no self-declared norms). Only a post-export transferable DFIA with exemption from basic customs duty is provided for. Fuel cannot be imported under the new DFIA. These aspects are reflected in the notification Nos. 18 to 22/2015-Customs dated 1.4.2015 for Advance Authorization Scheme. Provisions relating to accounting of inputs introduced in the earlier FTP (during 2013 and 2014) which are now reflected in para 4.12 of the Policy have been incorporated.


7.         It may be noted that under the Policy, the import of gold for jewellery sector shall be under Advance Authorisation on pre-import basis with actual user condition. Also, the admissibility of brand rate of drawback shall be as per para 4.15 (Advance Authorisation) and para 4.26 (DFIA) of the Policy.

8.         Keeping in view that an Advance Authorization is issued for a resultant product with specified inputs a change is reflected in Notification No. 18/2015-Customs dated 1.4.2015 which is expected to facilitate exporters who rely simultaneously on imported materials and domestic materials, especially those in the exempted goods sectors. The change allows the resultant products to be made by availing facility of rule 18 (rebate of duty paid on materials used) or rule 19{2}(removal of material without payment of duty for use in manufacture of goods exported} of Central Excise Rules subject to the condition that duty free material imported is used for manufacture of dutiable goods.

Export Promotion Capital Goods (EPCG) Scheme

9.         To further provide impetus to domestic production, the Policy has increased the lowered export obligation (when capital goods are sourced indigenously) from 10% to 25%. This is implemented by the Regional Authorities.

10.        The EPCG authorisation for annual requirement, the provisions for technological up-gradation and for transfer of EPCG capital goods to group companies in certain cases/sectors are discontinued.

11.        Amongst the significant simplifications under the Policy, the export obligation for spares for imported/domestically sourced capital good has been rationalized as that for capital goods. Installation Certificates (ICs) for capital goods have been permitted to be from jurisdictional Central Excise or independent Chartered Engineer. In the latter case, a registered unit would send copy to the jurisdictional Central Excise office. Capital goods may be installed at supporting manufacturer’s premises if prior to such installation the latter’s details are endorsed on the authorization by Regional Authority, who shall also, as per para 5.02 of Policy intimate the change to jurisdictional Central Excise offices and the Customs where  authorisation is registered. Extension of period for producing IC by Regional Authority would be dovetailed by the Customs. Certain provisions are added in Policy para 5.04 read with para 5.10 of HBP for ensuring that exported goods are manufactured by authorization holder in the case of third party exports. .The Policy/HBP and notification Nos. 16 and 17/2015- Customs and 18/2015-Central Excise all dated 1.4.2015 may be referred in the above regard. It may be noted that the position (effective from 18.4.2013), remains unchanged, that import of motor cars, sports utility vehicles and all purpose vehicles is not permitted under the EPCG scheme at zero duty.

Validity of AA/EPCG/DFIA Authorizations for imports and EO period

12.        Policy’s HBP para 2.18 mentions that authorizations must be valid on date of import and export obligation period must be valid on date of export.  Duty credit scrips issued under the Policy must be valid on date of debit of duty.

Suo moto payment of customs duty in case of bona fide default

13.        The Policy HBP paras 4.49 read with 4.50 and 5.23 refer to this and the Circular No. 11/2015-Customs dated 1.4.2015 has been issued for suo moto payment. Its suitable application to existing authorizations is not barred.


Verification and monitoring

14.        The Board’s extant Circulars and Instructions on verifications and monitoring remain in force. There have been instances of fabricated export documents (purported to be of Customs non-EDI ports) being used in obtaining rewards/showing fulfillment of EO. Based on DGFT’s suggestion, it is advised that genuineness of shipping bills or bills of export not on Customs EDI may be expeditiously verified while registering scrip or processing EODC based on such document. Insofar as monitoring is concerned, field formations have been recently enabled to view in EDI the authorization-wise all India export details which would assist in identifying actionable cases under Advance Authorization and EPCG schemes. The Board’s emphasis on timely action to safeguard revenue is evident from CBEC’s Comprehensive MIS formats DGI - Cus 11& 11A which may be referred.

Facility of exemption from furnishing bank guarantees (BG) or of giving concessional BG under the export promotion schemes subject inter alia to certain conditions (Circular No.58/2004-Cus as amended last by Circular No.15/2014-Cus)

15.        The Board had noticed a practice in one jurisdiction of prescribing BGs of 1% to 5% of the duty saved amount before new authorisations were registered when EODC for an existing authorisation was not produced in the prescribed time. The Board views that such a practice imposes transaction cost on exporters because every case of pending EODC is not a case of default in export obligation determined  by the competent authority and even the enforcement of bond executed for such existing authorisation may not be due. Further, choosing varying levels of BGs also creates room for generation of grievances against field officers. The field formations are expected to avoid similar practices.

16.        The above instructions may be brought to the notice of exporters through suitable public notice and the officers and staff may be guided through appropriate standing orders. Difficulties faced, if any, in implementation may please be brought to the notice of the Board.

It may be noted that to ensure timely inputs and reports from field formations for Department of Revenue or Board’s participation/reporting in inter-Ministerial matters related to policy, compliance and performance issues of the reward, duty exemption schemes and duty remission schemes, the communications are being sent to the official designation based NIC email IDs (initially created for Board’s Comprehensive MIS) and the officers are to keep these accounts functional by accessing them many times daily and make response from these email IDs only.

Apr 18, 2015

You need to mention all bank account and foreign travel in new IT return form

4:06 PM 2
You need to mention all bank account and foreign travel in new IT return form
Widening its net to check generation of black money, the Income Tax department has introduced significant changes in the income tax return form starting assessment year 2015-16. Taxpayers will now have to disclose  instances of foreign travel, details of their bank accounts in the country along with usage of balance in capital gain account schemes.

Relief obtained on account of tax treaties will also need to be mentioned in the returns for 2015-16.
In the new income tax return (ITR) form, any individual with an Aadhaar number will have to mention it and will have to mandatorily produce tax residency certificate (TRC), hitherto required only if asked by the assessing officer.

The new ITR forms, including ITR-1 and ITR-2, require an assessee to furnish the number of bank accounts held by the individual “at any time (including opened/closed) during the previous year” with the last balance in his or her account on March 31 of the just concluded fiscal.
The assessee will also have to furnish the name of the bank, account number/numbers, its address, IFSC code and any possible joint account holder.

With regards to foreign travel, the tax department wants the assessee’s passport number, place of issue of passport, countries visited, number of times such journeys were made, and in case of a resident taxpayer, the expenses incurred from “own sources in relation to such travel”.

Tapati Ghose, partner, Deloitte Haskins & Sells LLP, said: “Additional disclosures mandated in the new income tax return forms reaffirm the government’s intent to track taxable income overseas and in India. Changes incorporated in tax returns were expected from the budget speech of the Finance Minister and subsequently with the introduction of the Undisclosed Foreign Income and Assets (Imposition of Tax) Bill.”

Apr 17, 2015

Income tax return form ITR-1 SAHAJ, ITR 2, ITR 4S SUGAM and ITR V for AY 2015-16

7:27 PM 1
The income tax department notified income tax return form for the analysis year 2015-16. Income tax department issued ITR-1 SAHAJ, ITR-2, ITR 4S and ITRV forms for the AY 2015-16. However these forms are available in PDF format now. Income tax department soon upload the return form in java version too.


ITR-1 SAHAJ
Individual income tax return
ITR-2
This Return Form is to be used by an individual or a Hindu Undivided Family whose total income for the assessment year 2012-13 includes:-

(a) Income from Salary / Pension; or
(b) Income from House Property; or 
(c) Income from Capital Gains; or 
(c) Income from Other Sources (including Winning from Lottery and Income from Race Horses).
Further, in a case where the income of another person like spouse, minor child, etc. is to be clubbed with the income of the assessee, this Return Form can be used where such income falls in any of the above categories.

ITR 4S SUGAM
where presumptive business income tax return of individual and HUF having income from proprietorship or professional income.
ITR V ACKNOLEDEMENT


 Tags- Itr-2015-16,income tax return form 15-16,itr 2015-16,itr ay 2015-16,sugam 2015-16,itr 1 2015-16,sahaj itr 1 2015-16,itr 1 sahaj ay 2015-16,itr 2 2015-16,itr 2 ay 2015-16.itr 4s 2015-16,itr 4s sugam 2015-16,sugam ay 2015-16, Itr-2015-16,income tax return form 15-16,itr 2015-16,itr ay 2015-16,sugam 2015-16,itr 1 2015-16,sahaj itr 1 2015-16,itr 1 sahaj ay 2015-16,itr 2 2015-16,itr 2 ay 2015-16.itr 4s 2015-16,itr 4s sugam 2015-16,sugam ay 2015-16

Apr 16, 2015

E-filing of return mandatory for individuals and HUF claiming tax refunds and earning overseas income

4:25 PM 0
E-filing of return mandatory for individuals and HUF claiming tax refunds and earning overseas income
 CBDT made it mandatory e-filing of return of income for individuals and HUF who claim tax refund . Moreover the ordinary residents earning overseas income also needs to file income tax return in electronically mode. 

CBDT issued a notification no. 41/2015 dated 16 April 2015 and made 7th amendments rules in income tax rules. Full notification is as under.

 In exercise of the powers conferred by section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-

1. (1) These rules may be called the Income-tax (Seventh Amendment) Rules, 2015.
 (2) They shall be deemed to have come into force with effect from the 1st day of April, 2015.

2. In the Income-tax Rules, 1962,─
(1) in rule 12,─
(a) in sub-rule (1),-

(A) after the words, brackets, figure and letter “sub-section (4D)” the words, brackets, figure and letter “or sub-section (4E)” shall be inserted;

(B) for the figures “2014”, the figures “2015” shall be substituted;

(C) in clause (a), in the proviso, in clause (I), for sub-clause (ii), the following sub clauses shall be substituted, namely:-
“(ii) signing authority in any account located outside India; or
(iii) income from any source outside India;”;

(D) in clause (ca), in the proviso, in clause (I), for sub-clause (ii) the following subclauses shall be substituted, namely:-
“(ii) signing authority in any account located outside India; or
(iii) income from any source outside India;”;

(E) in clause (g), after the words, brackets, figure and letter “sub-section (4D)” the words, brackets, figure and letter “or sub-section (4E)” shall be inserted;
(b) for sub-rule(3), the following sub-rule shall be substituted, namely:-

‘(3) The return of income referred to in sub-rule (1) shall be furnished by a person mentioned in column (ii) of the Table below to whom the conditions specified in column (iii) apply, in the manner specified in column (iv) thereof:-

Person
Condition
Manner of furnishing return of income
Individual or Hindu undivided family
(a) Accounts are required to be audited under section 44AB of the Act;
Electronically under digital signature

(b) Where (a) is not applicable and,- (I) the return is furnished in Form No. ITR-3 or Form No. ITR-4; or (II) the person, being a resident, other than not ordinarily resident within the meaning of subsection (6) of section 6, has, (A) assets (including financial interest in any entity) located outside India; or (B) signing authority in any account located outside India; or (C) income from any source outside India; (III) any relief, in respect of tax paid outside India, under section 90 or 90A or deduction of tax under section 91 is claimed; or (IV) any report of audit referred to in proviso to sub-rule (2) is required
to be furnished electronically; or
(V) total income assessable under the
Act during the previous year of
the person (other than the person,
being an individual of the age of
80 years or more at any time
during the previous year and
furnishing the return in Form
ITR-1 or ITR-2),-
(i) exceeds five lakh rupees; or
(ii) any refund is claimed in the
return of income;
(A) Electronically under digital signature; or (B) Transmitting the data in the return electronically under electronic verification code; or (C) Transmitting the data in the return electronically and thereafter submitting the verification of the return in Form ITR-V.
(c) In any other case
(A) Electronically under digital signature; or (B) Transmitting the data in the return electronically under electronic verification code; or (C) Transmitting the data in the return electronically and thereafter submitting the verification of the return in Form ITR-V; or (D) Paper form;
Company
In all cases.
Electronically under digital signature
A person required to furnish the return in Form ITR-7
(a) In case of a political party;
Electronically under digital signature;

(b) In any other case
(A) Electronically under digital signature; or (B) Transmitting the data in the return electronically under electronic verification code; or (C) Transmitting the data in the return electronically and thereafter submitting the verification of the return in  under electronic verification
code; or
(C) Transmitting the data
in the return electronically
and thereafter submitting the
verification of the return in
Form ITR-V.
Firm or limited liability partnership or any person (other than a person mentioned in Sl. 1 to 3 above) who is required to file return in Form ITR-5
(b) In any other case.
(A) Electronically under digital signature; or (B) Transmitting the data in the return electronically under electronic verification code; or (C) Transmitting the data in the return electronically and thereafter submitting the verification of the return in Form ITR-V.

Explanation.- For the purposes of this sub-rule “electronic verification code” means a code generated for the purpose of electronic verification of the person furnishing the return of income as per the data structure and standards specified by Principal Director General of Income-tax (Systems) or Director General of Income-tax (Systems).’

(d) in sub-rule (4), for the words and brackets, “Director-General of Income-tax (Systems)”, the words and brackets “Principal Director-General of Income-tax (Systems) or DirectorGeneral of Income-tax (Systems)” shall be substituted;

(e) in sub-rule (5), for the figures “2013”, the figures “2014” shall be substituted.

(2) in Appendix-II, for “Forms SAHAJ (ITR-1), ITR-2, SUGAM (ITR-4S) and ITR-V” the “Forms SAHAJ (ITR-1), ITR-2, SUGAM (ITR-4S) and ITR-V” shall respectively, be substituted,
namely:-

Fixed deposit below 15 lakhs must have pre mature facility

3:55 PM 0
Fixed deposit below 15 lakhs must have pre mature facility
Reserve bank of India issued a instruction to all banks that any deposit below 15 Lakhs must have pre-mature facility with which the deposit holder can take back the amount anytime during the deposit period. Moreover banks can decide the differentiate rates on deposit 1 Core and above and below 1 crore. Full instruction is as under.

 Please refer to our circulars DBOD. No. Dir.BC.36/13.03.00/98 dated April 29, 1998, DBOD. No. Dir.BC.07/13.03.00/2001-02 dated August 11, 2001 and DBOD. No. Dir. BC.74/13.03.00/2012-13 dated January 24, 2013 in terms of which banks are allowed to offer differential rates of interest on term deposits on the basis of tenor for deposits less than ₹ 1 crore and on the basis of quantum and tenor on term deposits of ₹ 1 crore and above.

2. In this connection, attention is invited to paragraph 29 of sixth Bimonthly Monetary Policy Statement- 2014-15 announced on February 3, 2015 whereby it was decided to introduce the feature of early withdrawal facility in a term deposit as a distinguishing feature for offering differential rates of interest. Accordingly, banks will have the discretion to offer differential interest rates based on whether the term deposits are with or without-premature-withdrawal-facility, subject to the following guidelines:

All term deposits of individuals (held singly or jointly) of ₹ 15 lakh and below should, necessarily, have premature withdrawal facility.

For all term deposits other than (i) above, banks can offer deposits without the option of premature withdrawal as well. However, banks that offer such term deposits should ensure that at the customer interface point the customers are, in fact, given the option to choose between term deposits either with or without premature withdrawal facility.

Banks should disclose in advance the schedule of interest rates payable on deposits i.e. all deposits mobilized by banks should be strictly in conformity with the published schedule.

The banks should have a Board approved policy with regard to interest rates on deposits including deposits with differential rates of interest and ensure that the interest rates offered are reasonable, consistent, transparent and available for supervisory review/scrutiny as and when required.

Apr 15, 2015

Income tax exemption on Transport allowance to employees is doubled from 1-4-15

3:43 PM 0
Income tax exemption on Transport allowance to employees is doubled from 1-4-15
Income tax department doubled Transport Allowance granted to an employee to meet his expenditure for the purpose of commuting between the place of residence & duty from Rs. 800 to Rs. 1600 whereas Transport allowance granted to physically disabled employee for the purpose of commuting between place of duty and residence is also doubled from Rs. 1600 to Rs. 3200.

Income tax department issued a notification no. 39/2015 dated 13 April 2015 with 6th amendment rules of income tax. Full notification is as under.


In exercise of the powers conferred by section 295, read with clause (14) of section 10 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-

(1) These rules may be called the Income-tax (6th Amendment) Rules, 2015.
(2) They shall come into force on the 1st day of April, 2015.

2. In the Income-tax Rules, 1962, in rule 2BB, in sub-rule (2), in the Table,- (a) against serial number 10, in the entry under column(4),relating to the extent to which allowance is exempt, for the letters, figures and words “Rs.800 per month”, the letters, figures and words “Rs.1600 per month” shall be substituted;

(b) against serial number 11, in the entry under column (4),relating to the extent to which allowance is exempt, for the letters, figures and words “Rs.1600 per month”, the letters, figures and words “Rs.3200 per month” shall be substituted.
Tags-income tax exemption on transport allowance,transport allowance it exemption,it exemption transport allowance,transport allowance employees exemption

No TDS on additional payment due to forex currency change if TDS is deducted at credit of payment

3:33 PM 0
No TDS on additional payment due to forex currency change if TDS is deducted at credit of payment
Provisions of section 195 provide that once tax is deducted at source at the time of credit of payment, there can be no question of deduction of tax at source on full or in part at the time of payment. Once tax was deducted at the first stage when the amount of income was credited to the account of payee, which was done by converting foreign currency into TT buying rate on that particular date, then the assessee could not be called upon to deduct tax at source on the additional liability arising due to foreign exchange fluctuation

FACTS

• The assessee acquired technical know-how in respect of some automobile models which was capitalized as an `Intangible asset' and depreciation was claimed thereon.

• The Assessing Officer observed that between the date of credit of acquisition price and the date of actual payment, the exchange rate of rupee and Japanese yen fluctuated, as a result of which the assessee suffered a forex loss of Rs.5.22 crore. The cost of acquisition of the said asset which was originally recorded at Rs.141.47 crore swelled toRs.146.70 crore, the incremental amount being the forex loss ofRs.5.22 crore. The Assessing Officer observed that the assessee deducted tax at source under section 195 only on the payment of Rs.141.47 crore and no tax atsource was deducted from the additional payment of Rs.5.22 crore on account of fluctuation in foreign exchange rate.He disallowed depreciation on the corresponding amount ofRs.5.22 crore, which resulted into disallowance of Rs.1.30 crore.

• The assessee is aggrieved against the disallowance made by the Assessing Officer.

HELD

• When we read section 40(a)(i) in juxtaposition of section 195, the position which follows for disallowance under section40(a)(i) is that there should be a sum on which tax is deductible at source and the assessee fails to deduct the same. The stage of deduction of tax at source has been set out by section itself. It clearly provides that the deduction should be made `at the time of credit of such income to the account of the payee or at the time of payment…, whichever is earlier.' Thus, it is clear that the deduction of tax at source on a single transaction is contemplated at the earlier of the dates of credit or payment to the payee. Itis not on both the occasions. Once deduction of tax at source has been made at the time of credit, which event occurs first, then there can be no question of once again making deduction of tax at source on full or in part at the time of payment.[Para 10]

• The tax is required to be deducted at the first stage when the amount of income is credited to the account of payee and, hence, deduction of tax at source is also contemplated at that stage alone which is to be done by converting foreign currency into TT buying rate at that particular date. There is no warrant for accepting the Revenue's contention that the deduction of tax at source should have been made at the later stage also onthe additional liability when the assessee made payment. In our considered opinion, the Act does not require two phased deduction of tax at source on one transaction, one at the time of credit and second at the time of actual payment. Deduction of tax at source is required to be made only on one occasion, which in the context of section 195 is, earlier of the time of credit or the time of payment. Under such circumstances, the assessee cannot be called upon to deduct tax at source on the additional liability arising because of foreign exchange loss. If we take the contention of the Revenue to a logical conclusion, then every case of payment in convertible foreign exchange would require deduction of tax at source, firstly, at the time of credit and secondly, at the time when additional liability is fastened on it due to unfavorable rate of exchange. A very peculiar situation would arise, if instead of the assessee suffering forex loss, gets forex gain on account of favourable rate of exchange at the time of payment. Going by the viewpoint of the Revenue, in that case, it would become liable to refund a part of the amount of excess tax deducted at source at the first instance at the time of credit to the account of the payee, which position is manifestly contrary to the legislative intent and prescription. The crux is that in both the situations, i.e., whether there is a forex loss or gain, deduction of tax at source under section 195 is contemplated only at the first stage of the credit of income to the account of the payee. The higher or lower liability due to foreign exchange loss or foreign exchange gain is inconsequential in so far as deduction of tax at source under section195 is concerned. Once there is no default on the part of the assessee in making deduction of tax at source on the additional amount paid due to foreign exchange loss, there can be no question of making any disallowance under section40(a)(i)

Apr 14, 2015

New company can apply PAN/TAN with form INC-7- No other form required

12:20 PM 0
New company can apply PAN/TAN with form INC-7- No other form required
The income tax department issued a notification no. 38/2015 dated 10 April 2015 making fifth amendment rules. Now a company which is not registered with company act can apply PAN/TAN number with form INC-7 which is used as application for incorporation of company. No other form need to fill up for aplying PAN/TAN. Full notification and Form INC-7 are as under.

In exercise of the powers conferred by section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-

1. (1) These rules may be called the Income –tax (Fifth Amendment) Rules, 2015.

 (2) They shall come into force on the date of their publication in the Official Gazette.

2. In the Income-tax Rules, 1962, –
(1) in rule 114, –

(a) in sub-rule (1), the following proviso shall be inserted, namely:-

“Provided that in case of an applicant, being a company which has not been registered under the Companies Act, 2013 (18 of 2013), the application for allotment of a Permanent Account Number may be made in Form No. INC-7 specified under sub-section (1) of section 7 of the said Act for incorporation of the company.”;

(b) in sub-rule (4),-
(i) in the opening portion, after the words, brackets and figure “referred to in subrule (1)” the brackets, words and figure “[other than that referred to in the proviso to sub-rule (1)]” shall be inserted;

(ii) in the TABLE, in column (4),-
(I) against Sl. No. (1), for item (C) the following item shall be substituted, namely:-

“(C) Proof of date of birth—
copy of the following documents if they bear the name, date, month and year of birth of the applicant, namely:-—

(a) birth certificate issued by the municipal authority or any office authorised to issue birth and death certificate by the Registrar of Birth and Deaths or the Indian Consulate as defined in clause (d) of subsection (1) of section 2 of the Citizenship Act, 1955 (57 of 1955); or

(b) pension payment order; or
(c) marriage certificate issued by the Registrar of Marriages; or
(d) matriculation certificate or mark sheet of recognised board; or
(e) passport; or
(f) driving licence; or
(g) domicile certificate issued by the Government; or
(h) aadhar card issued by the Unique Identification Authority of India; or
(i) elector’s photo identity card; or
(j) photo identity card issued by the Central Government or State Government or Central Public Sector Undertaking or State Public Sector Undertaking; or

(k) Central Government Health Service Scheme photo card or Exservicemen Contributory Health Scheme photo card; or

(l) affidavit sworn before a magistrate stating the date of birth.”;
(II) against Sl. No. 3, for the words “Copy of Certificate of Registration issued by the Registrar of Companies.”, the following shall be substituted, namely:-

“(a) Copy of Certificate of Registration issued by the Registrar of Companies;
or
(b) corporate identity number allotted by the Registrar under section 7 of the Companies Act, 2013 (18 of 2013).”;

(2) in rule 114A, in sub-rule (1), the following proviso shall be inserted, namely:-
“Provided that in case of an applicant, being a company which has not been registered under the Companies Act, 2013 (18 of 2013), the application for allotment of a tax deduction and collection account number may be made in Form No. INC-7 specified under sub-section (1) of section 7 of the said Act for incorporation of the company.”.

Download Form INC-7
Tags-form inc-7,inc-7 form pan,inc-7 company pan

Apr 11, 2015

How to claim 4% SAD refund

5:49 PM 1
How to claim 4% SAD refund
Custom department issued a circular no. 12/2015 dated 9 April 2015 about instruction on 4% refund claim of SAD. Full circular is as under.

 I am directed to refer to the Board Circular No 6/2008-Customs dated 28.04.2008 which prescribes the manner of claim and sanction of 4% SAD refund in terms of notification No. 102/2007-Customs dated 14.09.2007. Further, in terms of Para 4.2 of Board Circular No 6/2008-Customs, dated 28.04.2008, it is provided that an importer can file only one refund claim in month in a Commissionerate. However, representations have been received in the Board that this stipulation is not feasible in the Commissionerate having Customs locations widely spread and in situations where imports are made by an importer from more than one Customs location in a Commissionerate. Accordingly, it is requested that the extant provisions be simplified.

2. The matter has been examined by the Board. As a trade facilitation measure, it is decided that importers may file refund claim of 4% SAD refund in terms of notification No. 102/2007- Customs dated 14.09.2007 at the Customs stations where imports are made. However, the number of such claims at a Customs station shall be limited to one in a particular month.

3. Board Circular No. 6/2008-Customs dated 28.04.2008 stands modified to the above extent.

4.  Board desires that above guidelines may be brought to the notice of field formation working under their jurisdiction.

5.  Difficulty faced if any, in implementation of this Circular may be brought to the notice of the Board at an early date.  

Apr 10, 2015

Capital gain in mutual fund under fixed maturity plan on extension term

1:28 PM 0
Capital gain in mutual fund under fixed maturity plan on extension term
CBDT issued a circular no. 6 dated 9 April 2015 about capital gain in respect of unit of mutual fund Funds under the Fixed Maturity Plans on extension of their term. Full circular is as under.

As per the provisions of the Income-tax Act, 1961 (hereinafter referred to as the Act) prior to the amendment made by the Finance (No.2) Act, 2014, assets in the nature of shares, listed securities, units of mutual funds and zero coupon bonds qualified as long term capital assets if held for a period of more than twelve months as against the holding period of more than thirty-six months in case of other assets. Accordingly, units of a mutual fund under the Fixed Maturity Plans (FMPs) held for a period of more than twelve months qualified as long term capital asset. The amendment in sub-section (42A) of section 2 of the Act by the Finance (No.2) Act, 2014 changed the period of holding in case of unlisted shares and units of a mutual fund (other than an equity oriented fund) for their qualification as long term capital asset to more than thirty-six months. As a result, gains arising out of any investment in the units of FMPs made earlier and sold/redeemed after 10.07.2014 would be taxed as short-term capital gains if the unit was held for a period of thirty-six months or less. 

2. FMPs are closed ended funds having a fixed maturity date wherein the duration of investment is decided upfront. The funds collected by FMPs are invested by the Asset Management Companies (AMCs) in securities having similar maturity period. To enable the FMPs to qualify as a long-term capital asset, some AMCs administering mutual funds have offered extension of the duration of the FMPs to a date beyond thirty-six months from the date of the original investment by providing to the investor an option of roll-over of FMPs in accordance with the provisions of Regulation 33(4) of the SEBI (Mutual Funds) Regulations, 1996. In this regard representations have been received in the Board seeking clarification regarding applicability of tax on capital gains in the hands of the unit holder at the time of roll over of FMPs that are closed ended schemes.

3. In this matter the Securities and Exchange Board of India (SEBI) has informed that Regulation 33(4) of the SEBI (Mutual Funds) Regulations, 1996 allows the roll-over of close-ended schemes. Such regulation provides the following:- 

"(4) A close ended scheme shall be fully redeemed at the end of the maturity period: Provided that a close-ended scheme may be allowed to be rolled over if the purpose, period and other terms of the roll over and all other material details of the scheme including the likely composition of assets immediately before the roll over, the net assets and net asset value of the scheme, are disclosed to the unitholders and a copy of the same has been filed with the Board: Provided further that such roll over will be permitted only in the case of those unitholders who express their consent in writing and the unitholders who do not opt for the roll over or have not given written consent shall be allowed to redeem their holdings in full at net asset value based price." 

SEBI has clarified that in case of roll over in accordance with the aforesaid regulation the scheme remains the same and it does not constitute a different scheme. 

4. In the case of mutual funds, the unit of a mutual fund constitutes a capital asset and any sale, exchange or relinquishment of such unit is a 'transfer' under clause (47) of section 2 of the Act. The roll over in accordance with the aforesaid regulation will not amount to transfer as the scheme remains the same. Accordingly, it is hereby clarified that no capital gains will arise at the time of exercise of the option by the investor to continue in the same scheme. The capital gains will, however, arise at the time of redemption of the units or opting out of the scheme, as the case may be.