Post on 02-Apr-2020
`20/-For
www.vasai-icai.org JULY - AUGUST 2012
VASAI BRANCH OF WIRC
NEWSLETTER
VASAI BRANCH OF WIRC
NEWSLETTER
VASAI BRANCH OF WIRC
NEWSLETTER
Members
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The Institute of Chartered Accountants of India
The Institute of Chartered Accountants of India Vasai Branch of WIRC NewsletterJul - Aug 2012
02
GLIMPSES AT DATED 30TH JUNE & 1ST JULY, 2012 ICAI-NATIONAL STUDENTS’ CONVENTION
MANAGING COMMITTEE
EDITORIAL BOARD
CA Shweta Jain CA Ramanand Gupta CA Kishor Vaishnav CA Unmesh NarvekarChairperson Vice-Chairman Treasurer Imm. Past Chairman
CA Lalit Bajaj CA Pramod Dhamankar CA Haresh Mehta CA Ashok JainPast Chairman Past Chairman Committee Member WIRC Nominee
CA Shweta Jain CA Haresh Mehta CA Lalit Munoyat CA Hemant Shah CA Kamal Sharma CA Alpesh Shah CA Dushyant Chaudhary CA Anil Kabra CA Vikas Soni CA Haresh Kenia CA Prasad Chitre
Secretary &
Ms. Shilpa Verma Mr. Srinivas Anand Sriram Ms. Bhawana Jhawar Mr. Nikhil Chhabra Mr. Milind Joshi
Mr. Chirag MehtaMs. Mrunal KarveMs. Pooja RamkrishnanMs. M. Sabira Khojia Ms. Bhakti Tanna
Mr. Anil Kumar Reddy
Mr. Ashay Upadhayay
Ms. Purvi Porwal
Mr. Sahil Gupta
Ms. Kushboo Mehta Ms. Srija Shetty
Ms. Niddhi Kothari
Ms. Uzma Mandlik
Ms. Piyali Chatterjee
Ms. Vasudevan CR
Ms. Sarah Balasundaran
Mr. Dhruv Goyal Mr. Sukrut Sawarkar
CA T. N. ManoharanPast President-ICAI
CA Nilesh VikamseyChairman BOS-ICAI
Session Chairmen
CA N. P. SardaPast President-ICAI
CA Amarjeet ChopraPast President-ICAI
Shri Vijay KapurDirector - Board Of Studies
CA B. R. JajuDirector & CFO - Welspun Corp. Ltd
CA Madhukar HiregangeVice Chairman, Board of Studies
CA Uttam Prakash AgarwalPast President-ICAI
Paper Presenters
03
FROM CHAIRPERSON’S DESKMy Dear Professional Colleagues,
"Chartered Accountants: Partners in National Development" —
These words of acknowledgement and recognition used by visionary
former President of India Dr. A. P. J. Abdul Kalam for the Chartered
Accountant fraternity amply sums up the great role, power and
potential of the Accountancy profession in the country.
Now let me take this opportunity to extend my sincere wishes to all,
on the occasion of Chartered Accountants Day. I would like to wish
you all the very best in your future profession as Chartered
Accountants, Sixty three years back, on this day India witnessed the
enactment of the Chartered Accountant Act, 1949.
The first ever I would like to present gratitude to CA Jaydeep Shah,
President of ICAI and CA Subodh Agarwal, Vice President of ICAI and
also CA Nilesh Vikamsey Chairman, Board of Studies for giving us an
opportunity for organizing National Convention for CA Students for
the first time in the History of Vasai Branch of WIRC of ICAI. We will
also endeavour to hold such more events so will always look upon
you for gratefulness.
I believe, if we begin with humility, we will conclude with some
sustainable achievement. It is not strange that, with a humble
beginning, we always discover an infinite scope of opportunities and
possibilities. Let me say if we start with openness, conditions will
turn conducive themselves. This I can simply relate to the National
convention which was organized by us. Here the glimpses of it…. In
the absence of CA Jaydeep Shah, President Of ICAI and CA Subodh
Agarwal, Vice President of ICAI the Convention was inaugurated by
Padmashree CA T N Manoharan, Hon’ble Past President of ICAI and
CA Nilesh Vikamsey Chairman, Board of Studies. It drew many
speakers from the various parts of our nation. Our technical &
special sessions were enlightened further by the august presence of
luminary dignitaries (including Past Presidents of ICAI).
My heart fills with pride in acknowledging the efforts, enthusiasm
and perseverance of those who were committed to create the
presence of such wonderful event and make it a success and mark of
professional triumph. Because of their continuous and relentless
efforts of all the Affiliates, CA aspirants ,my team and Vasai WICASA
Team we have been able to come this far in the journey we
embarked upon a to continue.
Conferences & Conventions and other events in the same lineup
organized by our esteemed Institute is golden opportunities
to unleash the hidden potentials within students. Further our
Institute has launched new scheme of General Management and
Communication Skills (GMCS). I am sure the new Scheme of GMCS,
I and GMCS II with its contemporary courseware will help in the
professional development and advancement.
Our Vasai branch is also taking the initiative in the same line by
organizing on 14th and 15th of July 2012 Youth Festival and Quiz &
Elocution Competition respectively. By participating in the contest,
students will get motivated to study various topics in greater detail
and thereby it will improve their performance in the examination,
apart from improving their communication skills. The Quiz &
Elocution contests conducted in the past have witnessed very
enthusiastic response and participation. It is therefore proposed to
organize this contest this year also.
Vasai branch is also going to host Video profiling for CA community
and newly qualified Chartered Accountants, the objective of the
Video CV is to increase the visibility of CA final year students in front
of the recruiters, break the barriers of distance and location and
provide wider range of career options. It also helps in enhancing the
communication skills & bolstering the confidence levels of students.
Interested participants are requested to enroll for the same with the
branch.
Vasai Branch is always concern to provide platform as a perfect
medium for our members to hone their professional skills on a wide
variety of specialized areas of practice. These also provide
opportunities for members to be exposed to new and emerging
areas of practices I am sure all these seminars and other events will
attract and benefit even greater number of members in days to
come, particularly in the backdrop of plethora of opportunities being
offered in current globalised economy.
Branch is also organizing many programmes & seminars in the
upcoming months and current month itself and we have successfully
accomplished the goal of completion of our first certification course
on Indirect Taxes. We are grateful to ICAI for providing us an
opportunity, we have also completed a Seminar on Service Tax
Amendments on 7th July, was organized by WIRC and hosted
together by Vasai Branch & Vasai Virar CPE Study Circle, at Lions
Club Hall at Palghar. I acknowledge the unwavering support of WIRC
for giving us the opportunity to host this programme. I am also
grateful to all members and participants for their presence and
making these both events successful.
Since Tax laws in India are becoming more and more complex and
more so in the case of indirect taxes. Frequent changes in taxation
through Finance Acts, Notifications and Circulars are one of the
significant features of Indian tax laws. Appreciating these increasing
complexities and changing facade of indirect taxes, branch is
organizing the Six days Intensive Course on MVAT, C.S.T. & Allied
Laws in the month of August.
Also there is Lecture Meeting on SME in the month of August, as such
programmes will assist the present and prospective entrepreneurs
in their business growth. In India since, SMEs are making
tremendous progress and are getting more and more opportunities
to enhance their activities and expand & diversify their business in
core sectors.
Today, I feel very proud to have been a part of such a flourishing
branch. This will continue with the expansion, innovation and
growth of the association as a unit as it sets new benchmarks for the
future and I must mention that the success of the branch is directly
proportional to the support which it derives from its members. This
confidence motivated us to look beyond our horizons & take you
around the world. With this intention & experience of last four
IRRCs. This time Vasai Branch has planned to take you at Mauritius a
Premium Destination in the world famous for the Beaches. I expect
the same support and enthusiasm even for this IRRC too.
We look forward for your same support in future also.
As CA results are going to be declared. Wishing you all the blissful
result, and further conclude with, Some will clear and some will not,
Never lose hope, come again and combat,
All my good wishes are with you everyone all the best for the
18th July mission.
“Pursue your goal, even in the face of difficulties. Convert
difficulties into opportunities.”
With warm
Professional Regards
Chairperson
CA. Shweta Jain
The Institute of Chartered Accountants of India Vasai Branch of WIRC Newsletter Jul - Aug 2012
The Institute of Chartered Accountants of India Vasai Branch of WIRC Newsletter
04
FORTHCOMING PROGRAMMES
Date Seminar on Timings Venue Speakers Co-ordinators Fees CPE
FORTHCOMING PROGRAMMES FOR STUDENTS
FORTHCOMING PROGRAMMES OF BHAYANDAR STUDY CIRCLE
FORTHCOMING PROGRAMMES OF VASAI VIRAR STUDY CIRCLE
1, 2, 3, 6, 7, Intensive Course 5.30 p.m. Hotel Haridwar CA Amar Shukla CA Haresh Mehta ` 2200/- for 188 August, on MVAT, C.S.T & to Vasai West. CA Deepak Thakkar 9823137477 Members and 2012 Allied Laws 9.00 p.m. CA Rajat Talati CA Pramod Dhamankar Students.
CA Dilip Phadke 9987155522 ` 3000/- for CA Kiran Garkar OthersCA Bharat Gosar
4th August, Information System 9.30 a.m. IIPS Centre Eminent Speaker CA Pramod Dhamankar ` 17,500 100to 9th Sept, Audit (ISA) to Mira Road (E) 99871555222012 (6 CA Lalit Bajaj - Weekends) 9867692321
CA Unmesh Narvekar9821236179
15th August, IRRC - Matters in - Mauritius CA Anu Agarwal CA Lalit Bajaj - 9867692321 ` 65,000 9to 19th International Taxation CA Pramod DhamankarAugust,2012 9987155522
25th August, Lecture Meeting on 6.00 p.m. Hotel Veg Sagar, Mr. Ravi Tyagi, CA Lalit Bajaj - 9867692321 Free 32012 SME Listing to Nr. Maxus Mall, Chief Guest Amar Kakaria - 9987512101
9.00 p.m. Bhy(W) Mr. Swapnil Mahajan
8th July, Lecture Meeting on 6.00 p.m. Reliable Classes, Eminent Speaker CA Unmesh Narvekar ` 200/- 3September, Corporate Compliance to Mira Road (E) 98212361792012 9.00 p.m. CA Ramanand Gupta
9322231113
Date Seminar on Timings Venue Speakers Co-ordinators Fees CPE
22nd July, Video Profiling for 9.30 a.m. Branch Premises - CA Ramanand Gupta ` 750/- -2012 Newly Qualified CA onwards 9322231113
Date Seminar on Timings Venue Speakers Co-ordinators Fees CPE
22nd July, Revised Schedule VI 10.00 a.m. Hotel Zaika, 150 Eminent Speaker CA Nitesh Kothari - 32012 to Ft. Rd., Nr. Maxus
Mall, Bhy (W)
Date Seminar on Timings Venue Speakers Co-ordinators Fees CPE
4th August, Tax Audit with Tally Ref to 4.00 p.m. Hotel Kubera Eminent Speaker CA Rajesh Kotak - 32012 3CD Speaker & other Anx. to 7.00 p.m. 9561330333
18th August, Issues in Tax 4.00 p.m. Hotel Kubera CA Atul Suraiya CA Aashutosh Vidhvans - 32012 to 7.00 p.m. 9322272878
8th Sept., Issue in Vat Audit Form 704 4.00 p.m. Hotel Kubera Eminent Speaker CA Rajesh Kotak - 32012 to 7.00 p.m. 9561330333
5.30 p.m.
98338608701.00 p.m.
Jul - Aug 2012
The Institute of Chartered Accountants of India Vasai Branch of WIRC Newsletter
05
FORTHCOMING PROGRAMMES & SCHEDULE
INTENSIVE COURSE ON MVATCPE
18 Hrs
Venue Hotel Haridwar,
Timings 5.30 pm. to 9.00 pm.
FEES ` 2200/- for Members and Students. ` 3000/- for Others(Including Course Material, Tea and Dinner)
Co-ordinators CA Haresh Mehta - 9823137477
CA Pramod Dhamankar - 9987155522
Date Topic Speakers
1st August 2012 Introduction, Definition, CA Dilip PhadkeRegistration, Levy of Taxes, incl Schedules
2nd August 2012 Exemptions, Set Off Rules, CA Kiran Garkar(incl judgements of Mahalaxmi Traders-Bbay H C) Tax Invoice
3rd August 2012 CST, Branch & Consignment CA Amar ShuklaTransfer, Sale in Transit, HighSea Sale, Various forms, returns under CST Acts - S. S 52,53,54,55, Rule86 Profession Tax Act, Luxury Tax
6th August 2012 Maintenance of Books, CA Deepak ThakkarRecords & Audit.Search & Survey
7th August 2012 Composition Schemes - CA Bharat GosarTaxation of Works Contract (incl judgementson BAI of Bbay HC)
8th August 2012 Returns, Periodicity & CA Rajat TalatiE-filing of Forms &Procedural Issues.Assessment, Review,Rectification, Appeals,Interest, Penalty &Brain Trust
Vasai (W)
PROGRAM SCHEDULE
Dates 4th August to 9th September 2012(For 6 weeknds, Every Saturday & Sunday)
Venue IIPS Centre, Mira Road (East)
Timings 9.30 a.m. to 5.30 p.m.
Speakers Eminent
Fees ` 17500/-
Co-ordinators CA Pramod Dhamankar- 9987155522
CA Lalit Bajaj- 9867692321
CA Unmesh Narvekar- 9821236179
POST QUALIFICATION COURSE ON INFORMATION SYSTEM AUDIT (ISA)
CPE100 Hrs
Dates Saturday, 25th August,2012
Venue Hotel Veg. Sagar ,Near Maxus Mall, Bhayendar West
Timings 6.00 p.m. to 9.00 p.m.
Fees Free for All
Chief Guest Mr. Ravi Tyagi, Head-NSE EMERGE
Co-ordinators CA Lalit Bajaj- 9867692321
CA Amar Kakaria-9987512101
Timings Topics Speaker6.00pm to 6.15pm Registration
6.15 pm to 6.45pm Welcome address, Mr. Ravi TyagiSpeech by Chief Guest (Head-NSE EMERGE)
6.45pm to 7.45pm SME Banking Eminent Speaker
7.45pm to 8.00pm Tea Break
8.00pm to 9.00pm Practical & Regulatory Swapnil MahajanAspects for Listing on (Senior - Manager –SME Exchange Karvy Merchant Banker)
CPE3 Hrs
LECTURE MEETING ON SME LISTING
Jul - Aug 2012
INTERNATIONAL RESIDENTIAL REFRESHER COURSE
The Institute of Chartered Accountants of India Vasai Branch of WIRC Newsletter
06
Meet the Fantastic Natural Beauty
with
Exotic Sea Shores & Great Sight Seeing
Mauritius has No Boundaries
Meet the Fantastic Natural Beauty
with
Exotic Sea Shores & Great Sight Seeing
Mauritius has No Boundaries
From Wednesday, 15th August, 2012to Sunday, 19th August, 2012 (4N—5D)
CPE09 Hrs
Only For Rs.62800/-* per person, only for first 30 participants.Thereafter Rs. 65000/- till 40 seats
*Co
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itio
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Ap
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CA Shweta JainChairperson– Vasai Branch Past Chairman-Vasai Branch Past Chairman, Vasai Branch9920737198 9867692321 9987155522
CA Lalit Bajaj CA Pramod DhamankarProgramme Chairman Programme Co-ordinators
PremiumDestinationin the World
Stay in 4 Star comfortable and Luxurious Hotels.Seats are limited. Enrolment on First cum First serve basis.So hurry up & reserve your seat right now.
Mauritius: Double Tax TreatiesCompany Formation at MauritiusInvestment Opportunities in Mauritius
Speaker :
VASAI BRANCH OF WIRC – 65568900
Conference Subject:-
Contact:
CA ANU AGARWAL
Jul - Aug 2012
The Institute of Chartered Accountants of India Vasai Branch of WIRC Newsletter
07
Manage Your Team & your work more effectively with the
following principles.
1. Try to know what Your Team Wants from You
Followers consistently expect their boss to show five qualities:
• Vision
• Ability to motivate
• Decisiveness
• Good in crises
• Honesty and integrity
2. Have a clear Vision: Setting up a Direction
Do Not Predict the Future, Create the Future:
You have to give your team a sense of direction and purpose. You
can do that by telling them a simple story about your direction:
• This is where we are.
• This is where we are going, and
• This is how we will get there.
3. Learn How to Motivate Your Team
Your team will feel well motivated if they:
• Work for a worthwhile cause
• Have a meaningful role
• Feel supported in their role
• Have good colleagues
• Are recognised for their efforts
• Feel secure as a member of the team
4. Learn about Handling Crises
The principles of crisis management are well known;
a) Act fast. Don’t worry about the things you cannot control: you
cannot control them. Focus on what you can do and do it. Even if
it is a small thing, it builds momentum and builds confidence.
b) Be positive. Followers hate fear, uncertainty and doubt. Be
confident and they will happily follow. Do not worry if you take
some missteps: you can always change direction later. The
important thing is to keep up momentum.
c) Get help. You cannot do it all yourself, so get help from anyone
and everyone who can help you. Do not simply ask your boss for
general help: that is called delegating upwards, or giving up.
5. Setting Targets
When you set goals they should be SMART. This is what SMART
stands for:
• S – Specific
• M – Measurable
• A – Achievable
• R – Relevant
• T – Time bound
6. Build Your Trusted Network
You can think of trust as a simple formula:
T = (VxC)/R
To put this into English:
Trust (T) increases in proportion to Values Alignment (V) and
Credibility (C), but decreases in proportion to the perceived Risk
(R) of the situation.
7. Handling Bad News
Here is how to handle the inevitable setbacks which will happen
to you:
• Accept responsibility.
• Offer a solution.
• Act fast.
• Communicate early.
• Stay positive.
8. The Art of a Good Meeting
A good meeting will answer four questions positively for each
attendee:
1. What will I/we do differently as a result of this meeting? This is
normally the result of decisions being made. If you see an agenda
item which looks like it might go the wrong way for you, do not
fight the battle in the meeting. Fight it in private beforehand.
2. What progress have I made on my personal agendas at this
meeting? The informal agenda can be as useful as the formal
agenda. Use the few minutes before and after a meeting to work
your personal agenda with any hard-to-get executives you need
to talk to. If necessary, simply set up a meeting with them for
later.
3. What did I learn at this meeting? Meetings are a good way of
gathering intelligence about people and priorities. If you go to a
client meeting with a colleague, always debrief together
immediately afterwards so that you can maximize your combined
learning from the meeting.
4. What did I contribute? If you have nothing to contribute, do not
go. Just because senior executives are there, avoid the
temptation for ¯face time . If you are like a good child and you
are seen, not heard, you will be treated like a child: you will be an
irrelevance.
9. How to Get Promoted
1. Build a claim to fame. You need to have some stand-out
achievement. It is not enough to have beaten budget and shown
great personal skills: everyone else will be able to make the same
claim. You need to have sorted out a crisis, led some landmark
initiative, done something that makes people take notice.
2. Make moments of truth work for you. There are set piece events
where you are on display to top management: this is where they
will form their opinions. So if you have a speech or a presentation
to make, overinvest in it. If you need to get a speech coach, get
one. Appearances count.
3. Build the right image. Even if top bosses are not familiar with the
details of what you have really achieved, they will be familiar with
you as a person. If you are always positive, volunteering to help out and action-focused you will do far better than the technically
excellent colleague who is always a bit dour, cautious and
occasionally cynical. You cannot fake this. But you can work in
places that bring out the best in you, and you can focus on always
presenting your best face to the firm.
10.What Your Boss Wants From You
You will be judged not just on what you do, but on how you do it. I
have asked thousands of bosses what they expect from their
teams, and here is what they said:
• Reliability
• Ambition
• Proactive
• Intelligence
• Hard work
11.Manage Your Boss
Four principles lie at the heart of managing your boss well, and all
have been covered so far. You need to bring them together for
your boss:
1. Deliver on your formal commitments: budget, MBO,
development plan as appropriate.
2. Adopt the behaviour of a good team member: reliability,
ambition, proactivity, intelligence and hard work.
3. Build trust. Without trust, there is no relationship. Remember
that trust has three elements:
• Values alignment: always be loyal, sing the same tune as your
boss
• Credibility: always deliver, so manage expectations well.
• Manage risk: over communicate, flag bad news early, avoid
surprises.
4. Adapt your style to suit your boss. In practice, your boss has the
¯right style, in the sense that you have to adapt your style
because your boss won’t adapt their style to yours.
NEW RULES FOR MODERN MANAGERS— Compiled by CA Ravi Jain | e-mail: 2000.jainravi@gmail.com
Jul - Aug 2012
DIRECT TAX — Compiled by Haresh P. Kenia |e-mail: hpkenia@mtnl.net.in | 9821351838
�ISSUANCE OF TDS CERTIFICATES IN FORM
16ADOWNLOADED FROM TIN WEBSITE {206
TAXMANN 112 )}
Circular No. 01/2012 [F.No. 276/34/2011-IT(B)] Dated
09/04/2012
The CBDT has issued certain administrative clarifications
throughthis circular.
�GUIDELINES FOR ENGAGEMENT OF STANDING
COUNSELS TO REPRESENT THE INCOME TAX
DEPARTMENT BEFORE HIGH COURTS AND OTHER
JUDICIAL FORUMS; REVISION OF THEIR SCHEDULE OF
FEES AND RELATED MATTERS {206 TAXMANN 116
(ST.)}
Instruction No. 3/2012 [F.No. 279/MISC/M-75/2011-ITJ]
dated 11/04/2012
Detailed revision on above subject matter, after
consolidating all the earlier instructions can be found at
above citation.
�INCOME TAX (FIFTH AMENDMENT) RULES, 2012 –
INSERTION OF RULE 2F { 206 TAXMANN 157 (ST.)}
Notification No. 16/2012 [F.No.149/72/2011-SO(TPL)]
dated 30/04/2012
Guildelines for setting up an infrastructure Debt Fund for
the purpose of exemption U/s. 10(47) has been provided by
inserting Rule 2F.
�FINANCE MINISTER’S SPEECH ON FINANCE BILL, 2012
{206 TAXMANN 160 (ST.)}
Press Release dated 07/05/2012
After presenting the Union Budget for the year 2012-13 on
16th March, 2012, Hon. Finance Minister – Shri Pranab
Mukherjee has made certain amendments in the Finance Bill,
2012. His speech while presenting the amendments can be
found at above citation.
�FINANCE ACT 2012 RECEIVES PRESIDENTIAL
ASSENT
Finance Act 2012 has received Presidential assent on 28th
May, 2012.
RECENT - Complied
by CA Hemant R. Shah e:mail: gatu_1968@yahoo.co.in | 9869011148
LAW UPDATES
CASE LAWS
RECENT SUPREME COURT DECISIONSACIT vs. Tulip Star Hotels Ltd (Supreme Court)
Section 36(1)(iii): S.A.Builders 288 ITR 1 (SC) to be
reconsidered
The assessee borrowed funds and used it to subscribe to the
equity capital of its subsidiary company. The subsidiary
company used the said funds for the purpose of acquiring the
The Institute of Chartered Accountants of India Vasai Branch of WIRC Newsletter
08
Centaur Hotel, Juhu Beach, Mumbai. The assessee paid interest
on the borrowed money and claimed that a deduction U/s
36(1)(iii). The AO rejected the claim though the CIT (A),
Tribunal & High Court (338 ITR 482) allowed it by relying on
S.A.Builders Ltd vs. CIT 288 ITR 1 (SC).
It was held that as the assessee, being a holding company had a
deep interest in its subsidiary, and hence if the holding
company advanced borrowed money to a subsidiary and the
same is used by the subsidiary for some business purposes, the
assessee would be entitled to deduction of interest on its
borrowed loans. On appeal by the Department, it was held by
the Supreme Court that such interest is allowable U/s
36(1)(iii).
CIT vs. Cargil Global Trading Pvt. Ltd. (Supreme Court)
Section 194A TDS: Discounting charges is not “Interest”
The assessee paid Rs.3.97 crores to an associate concern in
S ingapore on account of d iscounted charges for
getting the export sale bills discounted. The AO held that the
discounting charges was “interest” U/s 2(28A) and that
as there was no TDS, the expenditure had to be disallowed U/s
40(a)(i). This was reversed by the CIT (A) and Tribunal. The
High Court [335 ITR 94 (Del)] relied on Circular No.65 dated
02/09/1971, Circular No.674 dated 22/03/1993 & Vijay Ship
Breaking 219 CTR 639 (SC) held that as the discounting
charges were not in respect of any debt incurred or money
borrowed and were merely discount of the sale consideration on
sale of goods, it was not “interest” U/s 2(28A) and there was no
obligation to deduct TDS thereon. On appeal by the Department
to the Supreme Court confirmed the decision of the view taken
by the Delhi High Court.
CIT vs. De Beers India Minerals Pvt. Ltd (Karnataka
High Court)
To “make available” technical knowledge, mere
provision of service is not enough; the payer must be
enabled to perform the service himself
The assessee, engaged in prospecting and mining for diamonds
entered into an agreement with a Netherlands company for
conducting air borne survey and providing high resolution
geophysical data. The AO held that the consideration was
chargeable to tax as “fees for technical services” under Article
12 of the India-Netherlands DTAA and held the assessee liable
U/s 195 & U/s 201 for failure to deduct TDS. This was reversed
by the CIT (A) & the Tribunal on the ground that though the
Dutch company had performed services using technical
knowledge and expertise, such technical experience etc. had
not been “made available” to the assessee. On appeal by the
Department to the High Court, the Karnataka High Court
dismissed the appeal filed by the Revenue and upheld the view
taken by CIT(A) and the Tribunal.
CIT vs Sahara India Housing Corporation Ltd. (Delhi HighCourt
Objective tests to classify shares gains as STCG vs. biz
profits laid down:
The assessee offered gains from sale and purchase of securities
as “capital gains”. The AO assessed it as business profits on the
ground that in the earlier years, it was offered as such.
The CIT (A) & the Tribunal accepted the assessee’s plea
on the ground that the securities were shown as “investments”
in the accounts and in the earlier years, the STCG was offered as
business profits as there was no difference in the tax rate.
On appeal by the Department, the Delhi High Court
upheld the view taken by the AO and reversed the Tribunal on
the following guidelines:
There was a dispute whether in the earlier years, the gains were
offered as business profits or as capital gains and the Tribunal
RECENT HIGH COURT DECISIONS
Jul - Aug 2012
The Institute of Chartered Accountants of India Vasai Branch of WIRC Newsletter
09
had not given a clear finding. The Tribunal ought to examine the
issue holistically keeping in mind the parameters/tests laid
down in CIT vs. Rewashanker A. Kothari 283 ITR 338 (Guj)
and CBDT’s Circular No.4/2007 dated 15th June 2007 on
when income from transactions in securities should be treated
as “business profits” and when as “capital gains”:
(a) Whether the initial acquisition of the subject-matter of
transaction was with the intention of dealing in the item
or with a view to finding an investment;
(b) Why and how and for what purpose the sale was
effected subsequently;
(c) How the assessee dealt with the subject-matter of
transaction during the time the asset was with the
assessee. Has it been treated as stock-in-trade or as an
investment in the Balance Sheet;
(d) How the assessee returned the income from such
activities and how the Department dealt with the same in
the preceding and succeeding assessments;
(e) Whether the Deed of Partnership or Memorandum of
Association, if the assessee is a firm or a company,
authorises such an activity;
(f) Most importantly, what is the volume, frequency,
continuity and regularity of transactions of purchase and
sale of the goods concerned;
Mehru Electrical & Engg. (P) Ltd. vs. CIT (Rajasthan High
Court)
Despite “Last Chance”, Appeal should be adjourned if
there is sufficient cause
The Department’s Appeal was adjourned at the assessee’s
request to 09/02/2010 and it was made clear that it would be
the “last opportunity”. The assessee’s Counsel filed an
application for adjournment on 08/02/2010 on the ground that
he was going to Mumbai for some urgent work. On 09/02/2010,
no one appeared for the assessee and therefore the Tribunal
rejected the adjournment application and allowed the
Department’s Appeal. On appeal by the assessee, the High
Court allowed the Appeal to the Assessee.
Ordinarily, it is not incumbent on the Tribunal to adjourn the
case when a last opportunity had already been granted to the
assessee. However, there may be number of circumstances
where adjournment becomes necessary in the interest of
justice. If the Counsel for assessee had to go for some urgent
work to Mumbai and an application for adjournment was moved
in advance, then in the interest of justice, a short
adjournment should have been granted. If number of
opportunities had already been afforded to the Counsel for
assessee, then adjournment could have been granted, on
payment of cost. The Tribunal has not assigned any reason as
to whether reason ment ioned in the app l icat ion
for adjournment, constituted sufficient cause for adjournment
or not. Even if a last opportunity is granted and case is fixed
for hearing and sufficient cause is shown on the date fixed
for hearing, then the case can be adjourned and it should be
adjourned, in the interest of justice. Accordingly, the Tribunal
committed an illegality in rejecting the application for
adjournment and in deciding the appeal ex-parte. Appeal
remitted to the Tribunal for decision on merits on payment of
costs of Rs.21,000/- by the assessee.
CIT vs. Awadh Hotels (P) Ltd (Allahabad High Court)
Interest U/s 234A, 234B & 234C, though mandatory, is
not payable if AO does not direct it to be charged in
Assessment Order:
The AO passed the Order U/s 143(3) in which he omitted to
direct that interest U/s 234A, 234B & 234C should be levied.
The Tribunal, relying on Ranchi Club Ltd. 247 ITR 209 (SC)
held that in the absence of a specific direction, interest was not
leviable. Before the High Court, the Department relied on the
larger bench decision in Anjum M.H.Ghaswala 252 ITR 1 (SC)
and argued that as interest U/s 234A, 234B & 234C was
mandatory, there was no need for the Assessment Order to
specifically direct that interest should be charged. The High
Court dismissed the Revenue’s Appeal.
Court on its Own motion vs. CIT (Delhi High Court)
High Court takes notice of TDS Refund harassment by
Department & demands answers:
One Anand Parkash, FCA, addressed a letter dated 30/04/2012
to the High Court in which he set out the numerous problems
being faced by the assesses across the country owing to the
faulty processing of the Income Tax Returns and non-
grant of TDS credit & refunds. He claimed that because of
the Department’s fault, the assessees were being
harassed. The High Court took judicial notice of the letter,
converted it into a public interest writ petition and directed the
CBDT to answer each of the allegations made in the letter. In
addition, the Court demanded an answer to the following
issues:
(1) Whether procedure U/s 245 of the Act, is being followed
before making adjustment of refunds and whether
assessees are being given full details with regard to
demands, which are being adjusted.
(2) Whether the Revenue is taking caution and care to
communicate rejection of TDS certificates and intimation
U/s 143(1) in case any adjustment or modification is
made to taxes paid, either as advance tax, self
assessment tax or TDS.
(3) Whether and what steps are taken to verify and ascertain
that the old demands against which adjustment is being
made was communicated to the assessee?
(4) What steps have been taken to ensure that the deductors
correctly upload the TDS details/particulars on the
Income Tax website?
(5) What is the remedy available to the assessee and can
he/she approach the Department in case the deductor
fails to correctly upload the particulars in his/her cases?
(6) Whether an assessee can get benefit of TDS deducted
or/and paid but not uploaded by the deductor and
procedure to claim the said benefit?
CIT vs. High Energy Batteries (India) Ltd. (Madras High
Court)
Sale & Lease Back transactions are not “sham”
transactions:
The assessee purchased igni-fluid boiler from its sister concern
and on the same day leased it back. The AO & CIT(A) relied on
McDowell 154 ITR 148 and held the sale and lease back
arrangement to be a sham & camouflage for a loan by the
assessee to the sister concern and rejected the assessee’s
claim for depreciation. However, the Tribunal allowed the claim
on the ground that the transaction was not a “sham”. On appeal
by the Department, the High Court dismissed the Appeal on
following considerations:
(i) Though the machinery was embedded and was in
possession of the seller, the assessee took constructive
delivery of the machinery. As the law recognises
constructive delivery as an acceptable mode of delivery
and possession, physical possession is not necessary.
Thus there is no material on record to show that the
sale was a sham transaction and so its genuineness
cannot be questioned. As regards the lease, the fact that
some part of the funding came from Wipro Finance & that
the lessee paid directly to Wipro in satisfaction of the
assessee’s obligation does not make the agreement a
sham because it is a matter of pure commercial
understanding between the parties as to the modalities
of lease rental payment. Given the freedom to enter
into agreements with parties and guided by
commercial considerations, even to invoke the theory
(cont)...RECENT CASE LAWS
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(cont)...RECENT CASE LAWS
of tax evasion, the Revenue must have sufficient material
to draw an inference of what had been shown as an
understanding on an agreement between the parties, is
not, in fact, so
(ii) In Vodafone International Holdings 341 ITR 1 (SC),
McDowell was considered extensively and it was held
that there is no conflict between McDowell and Azadi
Bachao Andolan 263 ITR 706 (SC) & Mathuram
Agarwal 8 SCC 667. It was pointed out that the task of the
Revenue/Court is to ascertain the legal nature of the
transaction and while doing so, it has to look at the
entire transaction as a whole and not to adopt a
dissecting approach. It was pointed out that “the
Revenue cannot start with the question as to whether the
impugned transaction is a tax deferment/saving device
but that it should apply the “look at” test to ascertain its
true legal nature. Genuine strategic tax planning has
not been abandoned by any decision of the English
courts till date.” It was held that while colourable devices
cannot be a part of tax planning, it cannot be said that all
tax planning are illegal/ impermissible. Applying this
ratio, the mere fact that what had been purchased had
been leased out to the vendor or that vendor had
undertaken to pay the hire charges on behalf of the
assessee to the hire purchase company does not per se
lead to a conclusion that the transaction is a sham one.
Mahesh Nemichandra Ganeshwade vs. ITO (ITAT Pune)
Section 54EC: If investment within 6 months of transfer
is impossible, then relief is available if investment made
within 6 months of receipt of consideration:
The assessee entered into a Development Agreement on
12/07/2005 in which the consideration was fixed at Rs.2.50
crores. A correction Deed was entered into on 02/07/2007 in
which the sale consideration was increased to Rs.4.90 crores.
The assessee invested Rs.50 lakhs in section 54EC bonds on
03/08/2007 and 27/10/2007. The AO held that the date of
transfer was 12/07/2005 and as the section 54EC investments
had been made beyond a period of 6 months from the date of
transfer, the exemption was not available. The assessee
claimed that as it was impossible for him to invest within 6
months from the date of transfer, the period of 6 months had to
be reckoned from the date of receipt of consideration. HELD by
the Tribunal:
Though section 54EC requires the investment to be made within
6 months of the date of transfer, a technical interpretation
cannot be adopted but it has to be interpreted having regard
to the purpose and spirit of the section. In Circular No.791
dated 02/06/2000, the CBDT held in the context of capital gains
arising U/s 45(2), that though the transfer arises in the year of
conversion of a capital asset into stock-in-trade, the period of 6
months for investment U/s 54E has to be reckoned from the
date of sale of the stock-in-trade. The CBDT appreciated the
impossibility of the assessee being able to invest the amount in
specified assets within six months from the date of transfer.
This interpretation of the CBDT supports the assessee’s claim
that where the consideration is received much after the date of
transfer and it is not possible to invest the same within 6
months of the date of transfer, the period of 6 months must be
reckoned from the date of receipt of consideration.
DCIT vs. Mastek Limited (ITAT Ahmedabad)
Foreign Income-Tax is deductible U/s 37(1). Bar in
section 40(a)(ii) does not apply to foreign taxes:
The assessee paid Rs.42.57 lakhs in Belgium as Income-Tax
and claimed that as deduction U/s 37(1). The AO rejected the
claim by relying on section 40(a)(ii) which provides that any
sum paid on account of tax levied on profits or gains of business
RECENT TRIBUNAL DECISIONS
shall not be allowable as a deduction, though the CIT (A)
allowed the claim on the ground that the bar in section 40(a)(ii)
did not apply to foreign taxes. On appeal by the Department,
the Ahmedabad Tribunal dismissed the appeal and upheld the
view taken by the CIT (A) on the following grounds:
The term “tax” is defined in section 2(43) to mean Income-Tax
chargeable under the provisions of this Act. Section 37(1)
allows a deduction of all taxes and rates. Taxes levied in foreign
countries whether on profits or gains or otherwise are
deductible U/s 37(1) not hit by section 40(a)(ii). It is also not
application of income. The same view has been taken by ITAT
Mumbai in South East Asia Shipping Co. & Tata Sons Ltd.
and the Department’s Reference Applications U/s 256(1) &
256(2) were rejected and the issue has reached finality.
Telecommunications Consultants India Ltd vs. ACIT (ITAT
Delhi)
Under Article 7 of the DTAA, foreign PE profits may be
taxed in India
The assessee, an Indian PSU company, earned Rs.10.68 crores
from foreign projects in Oman etc. The assessee claimed that it
had a “Permanent Establishment” (PE) in those countries and
that in accordance with the DTAA, only the source country was
entitled to tax the profits and India was not authorized to tax
the foreign PE profits. The Tribunal rejected the plea of the
Assessee.
Shri Jatinder Kumar Madan Vs Income Tax Officer (ITAT
Mumbai)
[A.Y.2006-07] [25/04/2012] ITA No.:6921/Mum/2010
Section 54: Exemption is available on exchange of old
Flat by New flat:
The assessee had exchanged old flat with new flat to be
constructed by the builder under development agreement
which amounts to transfer under section 2(47) of the Act. Thus,
the only other condition which is required to be satisfied is that
assessee either purchases a new residential flat within the
prescribed limit or constructs a new residential flat within a
period of 3 years from the date of transfer. The acquisition of a
new flat under a Development Agreement in exchange of the old
flat amounts to construction of new flat. This view is supported
by the decision of the Tribunal in the case of ITO vs. Abbas Ali
Shiraz. Therefore, the provisions of section 54 are applicable
and assessee is entitled to exemption if the new flat had been
constructed within a period of 3 years from the date of transfer.
The ld. AR has also argued that cash compensation received by
the assessee amounting to Rs.11,25,850/- can not be taxed as
capital gain as assessee had invested a sum of Rs.12.00 lacs in
REC bonds under section 54EC. Since cash compensation was
part of consideration for transfer of the old flat and the assessee
had invested the money in REC bonds, the exemption under
section 54EC will be available. In any case, the long term capital
gain computed by the AO including cash compensation as part
of sale consideration is much below the cost of new flat and
therefore, the cash component is also exempt under section 54.
As regards the completion of new flat within a period of 3 years,
assessee has filed a copy of letter dated 30/05/2007 of the
builder in which it has been mentioned that the builder had
applied for Occupation Certificate and possession was to be
given on 14/06/2007. This letter was not available before lower
authorities. The exact date of taking possession of the flat is
also not clear. This aspect therefore, requires verification by
the AO as to whether assessee had taken possession of new flat
within a period of 3 years. The claim of exemption under section
54 is allowed to the assessee, subject to verification of above
aspects by the AO after providing opportunity to the assessee.
M/s Lala Harbhagwan Dass Memorial & Dr. Prem Hospital
(P) Ltd., Vs. ITO, Ward 39(3) ITA No.5023/Del./2011
(A.Y.2005-06) [DELHI TRIBUNAL]
Mere erroneous claim in the absence of any concealment or
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furnishing of inaccurate particulars, is no ground for levying
penalty, especially when there is nothing on record to show that
the explanation offered by the assessee was not bona fide or
any material particulars were concealed or furnished
inaccurate. In these circumstances, the Hon. Tribunal had no
hesitation in observing that no penalty is exigible in relation to
claim for deduction of excess depreciation and interest on
amount borrowed for building which was incomplete.
Therefore, the ITAT held that penalty is not imposable in this
case and action of authorities below in imposing/confirming the
penalty U/s 271(1)(c) of the Act is neither proper nor justified.
Tara Jewels Export Pvt. Ltd. Vs. DCIT [ITAT MUMBAI]
(Date of pronouncement: 02/05/2012) A.Y.2002-03 [ITA
No.4274/M/2008]
Mere Disallowance of Expense not a ground to proceed u/s
271(1)(c)
The law stands very well settled by the Hon’ble Apex Court in
the case of CIT vs. Reliance Petroproducts (P.) Ltd., that merely
disallowing a claim of deduction raised by the assessee is not a
ground to proceed U/s 271(1)(c). For penalty to attract, it has
to be either a case of furnishing of inaccurate particulars,
concealment of income or at least the claim should have been
proved to be a mala-fide one. Since the said eventualities do not
exist in instant case, the Hon. Tribunal held that the penalty in
question does not hold ground.
PEL Holdings Pvt.Ltd. (Now merged with Topstar
Mercantile Pvt. Ltd.) Vs. ITO [MUMBAI TRIBUNAL] ITA
NO. 2402/MUM/2010
(A.Y. 1993-94) Date of pronouncement: 17/04/2012
Return of income is the only document where assessee can
furnish his income details:
Hon’ble Supreme Court in the case of CIT vs. Reliance Petro
Products Pvt. Ltd, reported in 322 ITR 158 (SC) has clearly
held that the Return of Income is the only document where
the assessee can furnish his particulars of income, where
as in the instant Appeal, the Appellant company has not
disclosed the receipt of premium received on renunciation of
rights in its Return of Income nor in the Computation of Income
accompanied with the Return of Income. So, penalty for
Concealment of Income is imposable U/s 271(1)(c) of the
Income Tax Act, 1961.
ACIT vs. SIL Investment Ltd (ITAT Delhi)
Section 14A: Onus is on AO to show expenditure is
incurred to earn tax-free income:
For A.Y.2006-07, the assessee earned dividend of Rs.17 lakhs
and LTCG of Rs.12 crores. The assessee claimed that it had
incurred no expenses to earn the tax-free income and therefore
there can be no disallowance U/s.14A. However, the AO
disallowed Rs.2 crores under Rule 8D towards interest and
administrative expenditure. The CIT (A) accepted that no
interest was incurred and deleted that disallowance. He also
reduced the disallowance on account of administrative
expenditure. On appeal to the Tribunal, it was held so on the
following considerations:
(i) The contention of the Revenue that some expenditure,
directly or indirectly, is always incurred for earning tax-free
income cannot be accepted. The burden is on the AO to
establish the nexus of the expenditure incurred with
the earning of exempt income before making any
disallowance u/s 14A (Hero Cycles 323 ITR 518 (P&H),
Jindal Photo followed)
(ii) As regards interest, the AO has to show the nexus
between the borrowed funds and the tax free investments.
If that is not done, disallowance of interest is not
permissible (K. Raheja Corporation (Bom) followed)
(iii) As regards admin. expenses, section 14A disallowance
cannot be made on an ad-hoc basis. It is the
Department’s responsibility to bring material on record
to show that expenditure was incurred for earning the
exempt income. If this is not done, disallowance is not
permissible (Wimco Seedlings followed)
Deputy Commissioner of Income Tax Vs M/s CNB Finwiz
Limited [DELHI TRIBUNAL] [ITA No.3989/Del/2011]
A.Y.2005-06
When addition itself is set aside, there cannot be penalty
for concealment of income:
The disallowance made by the Assessing Officer and sustained
by the learned CIT(A) was challenged by the assessee before
the ITAT in an appeal. The ITAT has decided the said appeal in
favour of the assessee. Therefore, at present, when the
addition itself has been set aside, there cannot be any case for
levy of penalty for concealment of income.
Deputy Commissioner of Income Tax Vs M/s Trade
Apartment Ltd. [ITAT KOLKATA] [I.T.A. No.: 1277/ Kol. /
2011 A.Y.2008-09] (30/03/2012)
Section 14A: In case net interest is income, no part of
interest paid can be disallowed for earning tax free
dividend
The taxpayer adjusted the interest expenditure against the
interest income earned. After such adjustment, no interest
expenditure remained to be disallowed. The tax payer offered
expenditure other than interest of Rs.111521/- for
disallowance under Section 14A of the Act on the estimated
basis. The Kolkata Tribunal held that there was no interest
expenditure remaining after adjusting the interest credited to
the Profit and Loss Account. Therefore, no part of interest paid
can be disallowed for earning tax free dividend. Further,
expenditure other than interest had been offered for
disallowance by the taxpayer under Section 14A of the Act.
Therefore, no further disallowance shall be made.
Income Tax Department invites Applications from CA’s
for carrying out section 142(2A) Special Audit
OFFICE OF THE CHIEF COMMISSIONER OF INCOME TAX, PUNE
Aayakar Bhavan, 12, Sadhu Vaswani Road, Pune 411 001,
Tele Fax 020-2611 4237 PBX 020-26127244
No. PN/CC/Coord/401/13/2012-13, Dated- 09/05/2012
NOTICE INVITING APPLICATIONS
The Chief Commissioner of Income Tax, Pune invites
applications from qualified Chartered Accountants/firms of CAs
for empanelment to carryout Special Audit U/s 142(2A) of the
I.T.Act, 1961. The remuneration for the Special Audit is
governed by Rule 14B of the I.T.Rules, 1962.
The criteria laid down for empanelment are as under:
(i) The Chartered Accountant / Firm of CA should have been in
practice as Auditors for the last 10 years and should have
experience of audit U/s 44 AB of the Income Tax Act for
atleast 5 years;
(ii) The average professional receipts from Audit of Non-
Banking and Non-financial Institutions as shown in the
Return filed for the last 5 years ending on 31/03/2011
should be Rs.50 lakhs or more;
(iii)No applicant shall qualify for empanelment as Auditor, if
a) he has been dismissed or removed from Government
service; or
b) he has been convicted of an offence connected with any
proceeding under the Income-tax Act, 1961 (43 of
1961), or the Wealth-tax Act, 1957 (27 of 1957), or the
Gift-tax Act, 1958 (18 of 1958), or a penalty has been
imposed on him under clause (iii) of sub-section (1) of
section 271 or clause (I) of section 273 of the Income-
tax Act, 1961, or under clause (iii}of sub-section (1) of
OTHER RECENT DEVELOPMENTS/
AMENDMENTS
(cont)...RECENT CASE LAWS
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(cont)...RECENT CASE LAWS
section 18 of the Wealth-tax Act, 1957, or under clause
(iii) of sub-section (1) of section 17 of The Gift-tax Act,
1958; or
c) he is an undischarged insolvent or
d) he has been convicted of any offence and sentenced to a
term of imprisonment; or
e) he has been found guilty of misconduct in his
professional capacity by the institute of Chartered
Accountants of India.
(iv) The general reputation of the CA/Firm of CAs will be
considered and taken into account by the Committee
constituted to recommend names for empanelment ;
The Chartered Accountants/Firms of CAs who fulfill the
above criteria may submit the application (duly filled in) in
the prescribed form with relevant documents (duly
certified) to the office of ACIT (Guard.), Room No.214, 2nd
Floor, Aayakar Bhavan, 12, Sadhu Vaswani Road, Pune- 411
001 on or before 30/05/2012.
The application form may be obtained from the office of the
ACIT (Co-ord.), Pune.
The decision of the Chief CIT, Pune as regards the
empanelment of CA Firms of CAs will be final.
(R.Y.BALAWADE)
ACIT (Co-ord),
For Chief Commissioner of Income Tax, Pune,
Amended GAAR Provisions in the Finance Bill 2012:
Press Release dated 15/05/2012 issued by the Ministry
of Finance:
The following government amendments have been proposed in
the Provisions relating to General Anti-Avoidance Rules (GAAR)
contained in the Finance Bill 2012:
i) To remove the onus of proof from the tax-payers to the
Revenue Department before any action can be initiated
under GAAR.
ii) To introduce an independent member, not below the rank
of Joint Secretary from the Ministry of Law, in the
GAAR approving panel to ensure objectivity and
transparency.
iii) To provide that both, resident or non-resident tax-payer can
approach the Authority for Advance Ruling (AAR) for a ruling
as to whether any arrangement to be undertaken is
permissible or not under the GAAR provisions.
iv) To provide more time to both tax payers and the tax
administration to address all related issues, it is proposed to
defer the applicability of GAAR provisions by one year i.e.
with effect from financial year 2013-14.
LLP – Notice for filing Form-8 & 11 for Financial Year
2011-12th
i) All LLPs registered upto 30 September, 2011 have to
mandatorily close the financial year as on 31/03/2012 and th th
file Form-11 by 30 May, 2012 and Form-8 by 30 October,
2012.
ii) LLPs registered from 01/10/2011 to 31/03/2012 have
option either to close financial year as on 31/03/2012 or
31/03/2013 and to file Form-8 & 11 accordingly.
iii) Please note that if LLP fails to file Form-8 & 11 within time, an
additional fees of Rs.100/- is payable per day till date of
filing.
Section 80CCG: Deduction for Investment made under
any Equity Saving Scheme: w.e.f. A.Y.2013-14
Newly inserted Section 80CCG provides deduction in respect of
investment made under notified equity saving scheme. The
deduction under this section is available if following conditions
are satisfied:
(a) The assessee is a resident individual (may be ordinarily
resident or not ordinarily resident)
(b) His gross total income does not exceed Rs. 10 lakhs;\
(c) He has acquired listed shares in accordance with a notified
scheme;
(d) The assessee is a new retail investor as specified in the
above notified scheme;
(e) The investor is locked-in for a period of 3 years from the date
of acquisition in accordance with the above scheme;
(f) The assessee satisfies any other condition as may be
prescribed.
(g) Amount of deduction is at 50% of amount invested in
equity shares subject to a maximum of Rs.25,000/-. If any
deduction is claimed by a taxpayer under this section in any
year, he shall not be entitled to any deduction under this
section for any subsequent year.
(h) Withdrawal of deduction – If the assessee, after
claiming the aforesaid deduction, fails to satisfy the above
conditions, the deduction originally allowed shall be
deemed to be the income of the assessee of the year in which
default is committed.
Few tips to Prevent Income Tax Raids:
One should not keep any unaccounted or undisclosed
money, property or income popularly known as black money. If
such a disclosure is made before its detection by the Income Tax
Department, the chances of being trapped in a tax raid are
minimized. A tax raid may also be conducted against a person in
possession of undisclosed income or property not belonging to
him but to someone else. It is therefore important for a person
who is in possession or in custody of someone else’s jewellery or
other valuables, etc. to ensure that they are duly accounted for.
DO’S
1. Make correct disclosure of income and wealth in
Returns:
One should make a full and true disclosure of one’s taxable
& exempt income. Similarly, a person’s wealth should be
properly disclosed to the Wealth Tax Officer.
2. Comply with summons or notices to prevent a tax raid:
It is absolutely necessary to fairly and properly comply with
the summons. Wherever this is not possible, proper
adjournment should be sought. Co-operation on the part of
a person, whether he is an income tax assessee or not, will
ensure prevention of a raid.
3. How to declare exempted or non-taxable income and
wealth:
When the entire picture is placed before the Assessing
Officer, there is little scope or raid on the grounds of
possessing undisclosed income. In view of the relaxed
wealth tax exemption limit, many will now be outside the
Wealth Tax net, hence they may enclose their statement of
wealth with the income tax Return.
4. Preserve important vouchers and other documentary
evidence for the acquisition of assets:
It is vital to preserve important vouchers and/or other
documentary evidence as proof for their acquisition. This is
necessary to prove the acquisition of such assets in case an
inadvertent Income Tax raid takes place and the assessee is
called upon to prove the nature and source of acquisition.
5. How to prevent income tax raid on lockers & safe
deposit vaults:
The owner of a locker, should maintain a register recording
its contents for disclosure if called upon by the Income Tax
Authorities with custodian to get a declaration from the
owner regarding the nature and source of the articles to
satisfy.
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DON’TS
1. Don’t introduce fresh capital over 10 lakhs.
2. Don’t introduce new unsecured loans exceeding 25
lakhs.
3. Don’t make investment more than 5 times the Gross
Receipts (including agricultural income).
4. Don’t sale property for lesser amount than Govt.
Valuation.
5. Don’t pay Commission above Rs.10 lakhs.
6. Don’t declare total income less than 20% of
professional receipts.
7. Don’t declare profit less than 5% of receipts if you are a
contractor who’s GC Receipts exceed Rs.1 Cr.
8. Don’t adopt project completion method if you are
builder.
-*-*-*-
6) CBDT Instruction on grant of TDS credit for
A.Y.2011-12:
Instruction No. 4/2012 [F. No. 225/34/2011-
ITA.II], dated 25/05/2012
The Board has decided to withdraw Instruction no.01/2012
issued on 2nd February, 2012 on the above subject with
immediate effect. The following decisions have been taken
in this regard:
I) In all Returns (ITR-1 to ITR-6), where the difference
between the TDS claim and matching TDS amount
reported in 26- data does not exceed Rs.5000/-, the
TDS claim may be accepted without verification.
ii) Where there is zero TDS matching, TDS credit shall be
allowed only after due verification.
iii) Where there are TDS claims with invalid TAN, the TDS
credit for such claims will not be allowed.
iv) In all other cases TDS credit shall be allowed after due
verification.
-*-*-*-
7) How to surrender/Cancel extra /Additional PAN
Online / Manually:
An assessee may have been allotted multiple PAN Card which
might have been allotted to the Assessee for many reasons.
Assessee who has more than one PAN should immediately
apply for surrender of additional PAN number(s) allotted to
him as having more than one PAN may make him liable to a
penalty of Rs. 10,000/-.
Assessee can apply for surrender of PAN Card by two
methods:
1. Manually:
a) Write a letter to this effect to the Assessing
Officer under whose jurisdiction you have been filing your
Returns. The letter must contain details such as your
name, contact details, details of the PAN card
to be retained, details of the duplicate PAN card(s)
wh i ch you need to su r render, e t c . Keep the
acknowledgement copy of the letter that you have filed
with the I-T department, stating that you are
surrendering your additional PAN. That is sufficient as
proof of surrender and no additional confirmation from
the I-T authorities is required. On receipt of the
acknowledgement, there is no need for you to wait for
intimation from the Income Tax Department considering
that the PAN submitted has now been cancelled by them.
The acknowledgment copy of the letter submitted will
more than solve the purpose.
AS
b) Manually Fill the Form No. 49A for change/Correction in
correction in PAN and submit the same at your nearest
UTI PAN centers or NSDL TIN Facilitation centers.
2. Online -
a) Visit the following Link and fill the details in the
Online Form given at the link and following the
instructions.
http://incometax.sparshindia.com/pan/newPAN.asp
b) You can also surrender the PAN online by filing an
application ”change in pan data” through UTI PAN
Centers or NSDL TIN Facilitation Centers. In application
fill spare PAN number in the last row of the Form.
-*-*-*-
8) Persons carrying on agency business or earning
commission income should revise their Return of
Income for A.Y.2011-12, if original Return filed U/s
44AD:
In the Finance Bill, 2012 section 44AD has been amended
retrospectively w.e.f. A.Y.2011-12 to the effect that
presumptive scheme under the said section is not applicable
to:
“ persons carrying on profession as referred to in section
44AA(1) or
“ persons earning income in the nature of commission or
brokerage income or
“ persons carrying on any agency business.
The said amendment has been made with retrospective effect
from A.Y.2011-12. Retrospective amendment is either made
to validate an earlier levy or to make clear the legislative
intent.
Professionals are not covered under the presumptive scheme
of section 44AD that was very much clear from the definition
of eligible business as the word, specially business, was
mentioned therein and business cannot include professions.
However, whether agency business or income from
commission was covered under presumptive scheme
under section 44AD or not, it was not clear from the
wording of section 44AD and in the definition of
eligible business contained in the explanation to the
said sect ion, the word “business” has only been
mentioned and agency business could have been interpreted
as business by any rational person.
There fo re , the re must have been ce r ta in cases
where the assessees carrying on some agency business or
earning income from commission may have filed their
Return of Income under the presumptive income scheme of
section 44AD. In such cases, if such assessee’s (carrying on
agency business or earning income from commission)
turnover or income exceeds the limits prescribed U/s 44AA,
then such assessee would be required to maintain regular
books of accounts and he should have filed his Return of
Income as per Balance Sheet and books of accounts, as such
assessee carrying on agency business is not covered
u/s 44AD.
Thus, after the retrospective amendment in section 44AD
w.e.f A.Y. 2011-12, the assessees carrying on agency
business or earning income from commission should revise
their Return of Income of A.Y. 2011-12, if they have filed their
Return of Income presuming them to be covered under
section 44AD.
(cont)...RECENT CASE LAWS
Jul - Aug 2012
The Institute of Chartered Accountants of India Vasai Branch of WIRC Newsletter
GLIMPSES AT ICAI- National Students’ Convention Dated 30th June & 1st July, 2012
Jul - Aug 2012
Technical Session IV – Chaired by CA Madhukar Hiregange [Vice Chairman – Board of Studies] on GST and Point of Taxation Rules, 2011.
14
Deep Prajwalan by the gracious Hands of CA T.N. Manoharan (Past President–ICAI)
CA Shweta Jain (Chair- person-Vasai Branch) giving floral welcome to CA Nilesh Vikamsey Chairman –BOS-ICAI)
CA Shweta Jain (Chair-person-Vasai Branch) giving floral welcome to CA Shruti Shah (Chairperson-WICASA)
CA Haresh Mehta (Member Vasai Branch)Presenting Memento to CA Nilesh Vikamsey (Chairman BOS-ICAI)
CA Shweta Jain (Chair-person-Vasai Branch) giving floral welcome to CA Durgesh Kabra (Chairman WIRC)
Technical Session –III chaired by CA Amarjeet Chopra on Revised Schedule VI and Merger, Acquisitions & Requisite
Technical Session –I chaired by CA T.N.Manoharan on Transfer Pricing and Double Taxation Avoidance Agreement
CA Lalit Bajaj (Past
Chairman – Vasai Branch)
Presenting Memento to CA
T.N. Manoharan (Past
President-ICAI)
Technical Session –II chaired by CA N. P. Sarda on Accounting Standards and Auditor Rotation
CA Lalit Bajaj
[Past
Chairman-Vasai
Branch] giving
floral welcome
to CA Jay
Chhaira
[ Vice Chairman
– WIRC]
Ankit Mewada giving
floral welcome to CA
Dinesh Gandhi
[Treasurer WIRC]
CA Pramod Dhamankar [Past
Chairman – Vasai Branch]
and Ms. Neelam Gupta [ Vice
Chairperson –Vasai WICASA]
presenting Bouquet and
Memento respectively to CA
Uttam Prakash Agarwal [ Past
President – ICAI] in special
session II
Special Session III addressed by Mr. Raghuram MTV
Valedictory Session
Technical Session V chaired by CA B. R. Jaju
on Professional Ethics and FDI & Indian
Economy.
Special Session I addressed by CA Nilesh Vikamsey–Chairman - Board of Studies
The Institute of Chartered Accountants of India Vasai Branch of WIRC Newsletter
15
GLIMPSES AT various Seminars organised by Vasai Branch
Jul - Aug 2012
L-R : CA Santosh Sharma, CA Unmesh Narvekar (Past Chairman – Vasai Branch), CA Shweta Jain (Chairperson – Vasai Branch), Mr. Ajit Manjure (Deputy Manager – CDSL), CA Kishor Vaishnav (Secretary – Vasai branch) at (Seminar – Investor Awareness Programme on 3rd June2012)
CA Ajit Manjure (Speaker) at [Seminar – Investor Awareness Programme on 3rd June 2012]
CA Subhash Nair giving Memento to CA Saket Patawari [Speaker] at [Seminar–Certification Course on Indirect Tax]
CA. Jank Vaghani (Speaker)at [Seminar–Certification Course on Indirect Tax]
CA Virat Chavda, Speaker at Seminar –Certification Course on Indirect Tax]
Participants of (Seminar –Certification Course on Indirect Tax)
L-R CA. Suhas Kelkar,CA Jayesh Gogri (Speaker),CA Shweta Jain (Chairperson Vasai Br.), Mr. Tiwari (Guest of Honor),CA Pramod Dhamankar(Past Chairman Vasai Branch
CA Govind Goyal [Speaker] at [Seminar –Certification Course on Indirect Tax]
CA Yogesh Vajani giving Memento at CA Anik Koria [Speaker ]. [Seminar –Revised Schedule VI & transfer Pricing)
CA S.V.N. Rajeshwari (Member) welcoming to CA Amar Shukla[ Speaker ]. [Seminar –Certification Course on Indirect Tax]
L-R : CA Ramanand Gupta [ Vice Chairman– Vasai Branch, CA Lalit Bajaj [Past Chairman – Vasai Branch], CA Shweta Jain [Chairperson – Vasai Branch ], CA Anik Koria [Speaker], CA Unmesh Narvekar [Past Chairman – Vasai Branch]. [Seminar –Revised Schedule VI & transfer Pricing]
L-R CA. Pramod Dhamankar (Past Chairman-Vasai Branch),CA Vijay Brooklyn (Speaker),CA Shweta Jain [Chairperson – Vasai Branch],CA Haresh Mehta (Member-Vasai Branch ) [Lecture Meeting –Developing Excellence and mastering Success on 16th June 2012]
CA Jayesh Gogri (Speaker)at Service Tax Amendment
CA Amar Shukla [ Speaker]. [Seminar–Cert i f icat ion Course on Indirect Tax
Participants Lecture Meeting on Service Tax Amendment
Advocate Sushant Murty, Speaker at [Seminar– Certification Course on Indirect Tax]
The Institute of Chartered Accountants of India Vasai Branch of WIRC Newsletter
161616
Editor: CA. Shweta Jain Published by Vasai Branch of Western India
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The Institute of Chartered Accountants of India,
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Designed and Printed by Finesse • +91-22 4036 4600
Mr. Sriniwas Sriram (1st Runner up)
(cont)... GLIMPSES AT ICAI- National Students’ Convention Dated 30th June & 1st July, 2012
Participants of ICAI- National Students’ Convention-2012
CA D. P. Rewavala CA Arjun Saini CA Rajesh Kotak CA Anu Agarwal CA Narendra Bhambwani
Panel of Judges
Flag Hoisting on 1st July CA Day
Ms. Uzma Mandlik and Mr. Ashay Upadhayay taking Best Paper Presenters awards
Ms. Nidhi Kothari (1st Runner up) Mr. Vasudevan C R (2nd Runner up)
Our Vasai WICASA Team headed by CA Ramanand Gupta
Jul - Aug 2012