CORPORATE & PROFESSIONAL UPDATE JANUARY 01, 2016
Table of Contents
CORPORATE & PROFESSIONAL UPDATE JANUARY 01, 2016
DIRECT TAXES:
AOs to prepare satisfaction note under Sec. 153C as per SC’s guidelines in Knitwear’s case: CBDT
No denial of exemption to an institute just because it was training already trained persons [2015] 64 275 (Gujarat) Mudra Foundation for Communications Research & Education v. CCIT
CBDT notifies amended Forms & Rules regarding mandatory quoting of PAN for specified transactions vide Notification No. 95/2015 dated 30/12/2015.
CBDT issues Press Release regarding streamlining scrutiny assessment proceedings and facilitating electronic communication.
CBDT vide Circular No. 25/2015 dated 31.12.2015 provides that there will be No Penalty for disallowance under normal provisions if tax was levied under MAT for cases prior to 1-4-2016.
CBDT vide Circular No. 24/2015 dated 31.12.2015 directs AOs to prepare satisfaction note under Sec 153C as per SC’s guidelines in Knitwear’s case.
CBDT digitizes filing of appeal before CIT (A) vide Press Release dated 30-12-2015. Form 35 is being substituted with new digitized form. Documents relied upon before CIT (A) shall also be covered. Fixation of hearing of appeals shall also be electronically.
TDS u/s 194I – assessee in default – the Revenue is permitted to charge interest even after the Recipient has deposited the tax the same would amount to undue enrichment of the Revenue. Commissioner of Income Tax, TDS, Tax Recovery Officer (TDS) Versus M/s Bharat Hotels Ltd. – 2015 (12) TMI 1469 – KARNATAKA HIGH COURT
- 10A: Even undisclosed income surrendered by assessee is eligible for s. 10A exemption if dept does not show that the assessee has any other source. Bridal Jewellery Mfg. Co vs. ITO (ITAT Delhi)
IT: TDS u/s 194I – assessee in default – the order passed under Sec.201 (1) and (1A) of the Act on 28.1.2008 for the assessment year 2002-03 would be barred by limitation as the period of limitation would be four years from the end of the financial year in question –CIT (TDS), TRO (TDS) Vs. Bharat Hotels Ltd. (2015 (12) TMI 1469 – Karnataka High Court)
IT: Working of Tax Liability on book profit u/s.115JB (MAT) – Reopening of assessment – AO formed wrong belief that for the purpose of computing book profit u/s 115JB – receipt of dividend income of ₹ 15,458/- disappeared from the consideration – notice of reopening being bad in law quashed –M/s Meghmani Energy Ltd. Vs. DCIT (OSD)-II (2015 (12) TMI 1511 – Gujarat High Court)
Certificate under Section 10(23C)(vi) refused – certificate under Section 12A already issued – petitioner institution is established for the sole purpose of imparting education in a specialized field. Hence the petition is allowed. Certificate under Section 10(23C)(vi) to be allowed. Mudra Foundation for Communications Research And Education Versus CCIT– Ahmedabad-IV – 2016 (1) TMI 42 – Gujarat High Court
CBDT: The First Appeal before CIT (A) is to be compulsorily filed online in cases of compulsory filing of online ITRs – Press Release, dt.30 DEC 2015.
CBDT: In scrutiny cases where the AO proposes to make additions / disallowances, assessee would be given fair opportunity to explain his position- Instruction No.20/2015, dt.29 DEC 2015.
INDIRECT TAX:
ST: Benefit of VCES – the matter was under consideration of audit as on 1.3.2013 which is not yet being over. Therefore as per Section 106(2) of the Finance Act the petitioner is not entitled to get the benefit of the Service Tax Voluntary Compliance Encouragement Scheme 2013 (VCES) – M/s Hotel Southson Pvt. Ltd. Vs. CESTAT, CST (A) And Others (2015 (12) TMI 1451 – Madras High Court)
Cenvat Credit – Capital goods installed in the state of Jammu & Kashmir – services availed in the state of Jammu & Kashmir – there is no ambiguity or confusion exists – credit cannot be allowed. M/s. Vodafone Essar Spacetel Ltd. Versus Commissioner of Central Excise, Customs & Service Tax, BBSR-I – 2016 (1) TMI 24 – CESTAT KOLKATA
Cenvat Credit – input services – receipt of advertisements services for promoting the mutual fund – Availment of credit on brokerage fee – credit allowed as eligible. Sundaram Asset Management Company Ltd. Versus Commissioner of Central Excise & ST, LTU Chennai – 2016 (1) TMI 23 – CESTAT CHENNAI
Cenvat Credit Following issues were addressed in the above mentioned case law [2015] :-
- Cab services utilised by a BPO company for transportation of its employees to and from work place and their homes, are eligible for input service credit
- Courier services used by BPO company within country to carry out domain activity of export are eligible for input service credit
- Services received by assessee for maintaining its business premises from where activity of output services is carried out, is eligible for input service credit
- Manpower recruitment and supply agency’s services availed by BPO company for hiring staff would be eligible for input service credit
- Cenvat Credit: Security services availed by BPO company to provide safety to its employees who work at odd hours, is eligible for input service credit
- Cleaning services availed by BPO company for doing cleaning work at its guest houses maintained for use of its employees during travelling for business purpose would be eligible for input service credit
- Service tax paid by assessee for stay of its employees in hotel for business activities would be eligible for input service credit
- Design service availed by assessee for supplying coffee mugs bearing its logo would not qualify as input services related directly or indirectly to output services
- Service tax paid on business support services availed by assessee for conducting summits which helped it to improve its cliental would be eligible for input service credit
- Chartered accountancy services utilised by assessee for compliance of industrial and Labour laws is eligible for input service credit
- Legal consultancy services utilised by assessee for drafting reply and appeal papers would be eligible for input service credit
- Non-mentioning of registration number of service provider cannot be ground to deny input service credit for those services which are eligible
HCL Technologies Ltd. v. Commissioner of Customs & Central Excise & Service Tax 64 taxmann.com 279 (New Delhi – CESTAT)
Claim of refund of excess interest ( 24 instead of 13 ) paid on differential duty – refund application having been filed beyond the period of one year from the relevant day has to rejected as barred by limitation. Hindustan Petroleum Corporation Ltd. Versus Commissioner of Central Excise, Customs And Service Tax Visakhapatnam-I – 2015 (12) TMI 1441 – CESTAT BANGALORE.
Notification No. 152/2009-Customs dated 31.12.2009 is further amended so as to provide deeper tariff concessions in respect of specified goods imported from Korea RP under the India-Korea Comprehensive Economic Partnership Agreement (CEPA) w.e.f. 01.01.2016. vide Notification No. 60/2015 dated 30-12-2015.
Notification No. 53/2011-Customs dated 01st July, 2011 is further amended so as to provide deeper tariff concessions in respect of specified goods imported from Malaysia under the India-Malaysia Comprehensive Economic Cooperation Agreement (IMCECA) w.e.f. 01.01.2016 vide Notification No. 59/2015 dated 30-12-2015.
Notification No. 46/2011-Customs dated 01.06.2011 is further amended so as to provide deeper tariff concessions in respect of specified goods when imported from ASEAN countries under the India-ASEAN Free Trade Agreement w.e.f. 01.01.2016 vide Notification No. 58/2015 dated 30-12-2015.
ST: Demand of service tax – To maintain ones own equipment to optimize the usefulness by maintenance and repair in the BOOT period is certainly not liable to Service tax as services rendered to self cannot be taxed –C.C.E., Nashik Vs. Sahastronics Controls Pvt. Ltd. (2015 (12) TMI 1496 – CESTAT Mumbai)
DVAT:- clarified only the person who are providing e-Portal / Websites to other Dealers for selling their goods are required to be registered in terms of Notification No.3(515)/Policy/VAT/2015/330-341, dt.26.06.2015 –Cir.No.33, dt.29.12.2015.
DVAT:– It has been notified that Form DP-1 shall be submitted online by all the dealers latest by 31/01/2016. The form shall be filed by dealers registered upto 31/10/2015.
FAQ ON COMPANY LAW:
Query: Is it mandatory to file charge on a loan taken by LLP? If yes, which form is required to be filed? Please clarify.
Answer: The charge details i.e. creation, modification or satisfaction of charge, can be filed through Appendix to e-Form 8(Interim). However, it is not mandatory to file the charge details with the office of Registrar but the stakeholders can voluntarily file the same.
Query: For a project office of a foreign company in India, whether filing of FC-4 (MCA Form) mandatory for the financial year ended 31.03.2014?
Answer: Yes, Form FC-4 (Annual Return of a Foreign Company) is required to be filed by every foreign company registered with ROC as foreign company within 60 days from the closure of financial year.
Query: One of our client who is Director in a Limited Company is not satisfied with the performance of the company in financial matters. He requested us, being Chartered Accountants, to inspect the books of accounts of the company on his behalf. Kindly advice whether that company can refuse us to inspect the books of accounts?
Answer: Under section 128(3) of the Companies Act, 2013, the books of account and other books and papers maintained by the company within India shall be open for inspection at the registered office of the company or at such other place in India by any director during business hours, and in the case of financial information, if any, maintained outside the country, copies of such financial information shall be maintained and produced for inspection by any director subject to such conditions as may be prescribed.
The Companies Act, 2013 makes it quite clear that the inspection can be done by a director.
However, in case the director wishes to get the inspection done by an agent or a representative he must seek the approval of the Board of Directors without which he will not be allowed to do so. (Case- Vakharia Vs Supreme General Film Exchange CO. Ltd)
MCA
MCA issues Notification under section 458 of Companies Act, 2013, thereby Delegating powers to RDs under section 208 of the said Act.
MCA on 31 DEC 2015 issues Notification under section 458 of Companies Act, 2013 – Delegating the Powers to RDs under section 208 of the said Act.
MCA: Relaxation of additional fees and extension of last date of filing of forms MGT-7 (AR) and AOC-4 (FS) under the Companies Act, 2013 in the State of Tamil Nadu and UT of Puducherry – General Circular No.16/2015, dt.30 Dec 2015.
MCA extends deadline to file Annual Return and Financial Statements for Tamil Nadu and Puducherry upto 30.01.2016.
OTHER
NI ACT: The Ministry of Law and Justice has notified The Negotiable Instruments (Amendment) Act, 2015 which shall be deemed to have come into force on the 15.06.2015.
ICSI: CS Manish Gupta has been unanimously appointed Chairman of NIRC of ICSI for the year 2016 (Effective TODAY).
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