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Monthly Updates | Oct, 2016
CO
NT
EN
T 01-
DIRECT TAXES Income Tax Pg.3 International Tax Pg.16
02- INDIRECT TAXES Customs Pg.24 Excise Pg.31 Service Tax Pg.33
03- ROC UPDATE Pg. 37
04- UPCOMING DUE DATES Pg. 38
05- CONTACT Pg. 43
For Private Circulations Only 3 The Update –Oct, 2016, SGCO & Co.
INCOME TAX
NOTIFICATIONS
Liberal view in case of waiver of penalty for
years not covered by IDS
The CBDT has clarified that where a
declaration is made under the Income
Disclosure Scheme, 2016 and an identical
issue is involved for a year which is pending
assessment u/s. 143(3)/147of the Act, then,
the Pr. CIT or CIT shall take a lenient view in
respect of waiver of penalty on receipt of a
valid application u/s. 273A.
F. No282/227/2016-IT (inv.V)/26/2016
-----------------------------------------------------
JUDICIAL RULINGS
Failure to deposit the amount of
consideration not utilized towards the
purchase of new flat in the specified bank
account before the due date of filing return
of Income u/s 139(1) is fatal to the claim for
exemption. The fact that the entire amount
has been paid to the developer/builder
before the last date to file the ROI is
irrelevant
Facts:
On 29th April, 1995, the appellant
sold a plot of land in Mumbai for a
consideration of Rs.85,33,250/-.
On 16th July, 1996, the appellant
entered into an agreement to
purchase a flat for a consideration
of Rs.69,60,000/-.
The appellant paid two installments
of Rs.10,00,000/- each on 17th July,
1996 and 23rd October, 1996 to the
developer / builder i.e. before the
due date for filing of return of
For Private Circulations Only 4 The Update –Oct, 2016, SGCO & Co.
Income under Section 139(1) of the
Act i.e. 31st October, 1996.
On 1st November, 1996 the
petitioner paid to the developer a
further installment of
Rs.15,00,000/- for purchase of flat
pursuant to the agreement dated
16th July, 1996.
On 4th November, 1996 the
appellant filed his return of income
for the Assessment year 1996-97.
This was after the due date of filing
the return of income.
On 13th March, 2001, the Assessing
Officer passed an Assessment
Order under Section 143(3) read
with Section 147 of the Act. The
Assessment Order determined the
net consideration at Rs.75.39 lakhs.
Thereafter the Assessing Officer
allowed a proportionate exemption
of Rs.31.55 lakhs (out of Rs.35 lakhs
paid till the filing of return) from
Capital Gain Tax in terms of Section
54F of the Act. However, the
balance consideration of
Rs.43,84,334/- which was payable
for purchase of the flat pursuant to
the agreement dated 16th July,
1996 was brought to tax under the
head ‘Capital Gains’ on account of
appellant’s failure to deposit the
unutilized consideration for
purchase of the flat in specified
bank accounts in accordance with
the scheme of Central Government
as provided under Section 54F(4) of
the Act.
Being aggrieved, the appellant-
assessee filed an appeal to the
Commissioner of Income Tax
(Appeals) (CIT(A)). By order dated
19th October, 2001, the CIT(A) did
record the fact that the appellant
had obtained possession of the new
flat on 27th January, 1997.
However, the order of the
Assessing Officer dated 13th
March, 2001 was not disturbed.
Being aggrieved the appellant
carried the issue in further appeal
to the Tribunal. By the impugned
order, the Tribunal on an analysis of
Section 54F(4) of the Act, came to
For Private Circulations Only 5 The Update –Oct, 2016, SGCO & Co.
the conclusion that the appellant
had only utilized Rs.35,00,000/- of
the net consideration received on
sale of land towards purchase of a
flat before the due date of filing the
return of income. Further, the
balance of the net consideration
had not been deposited in the
specified bank account as
mandated by Section 54F(4) of the
Act. Thus dismissing the appeal of
the appellant-assessee.
Aggrieved by the order of ITAT, the
assessee filed appeal with the High
Court.
Held:
Section 54F(1) of the Act which grants
exemption from Capital gain tax where
a flat is purchased either within one year
prior to the sale of capital asset or
within 2 years after the date of sale of
the capital asset or where a residential
house is constructed within 3 years from
the date of sale of the capital asset, is
now subject to the provisions of Section
54F(4) of the Act. Thus, where the
consideration received on sale of capital
asset is not appropriated (where
purchase was earlier than sale) or
utilized (where purchase is after the
sale) then the same would be subject to
the charge of capital gain tax, unless the
un-utilized amounts are deposited in
specified bank account as notified in
terms of Section 54F(4) of the Act. The
exemption would be available to the un-
utilized amounts only if the mandate of
sub-section (4) of Section 54F of the Act
is complied with. Further the proviso to
sub-section (4) of Section 54F of the Act,
safeguards the Revenue where the
assessee had not invested the amounts
chargeable to Capital Gains within the
time prescribed under sub-section (1) of
Section 54F of the Act. Thus, in such
cases, Capital Gain under Section 45 of
the Act would be charged on the un-
utilized amount as Income of the
previous year in which the period of
three years from the date of transfer of
the capital asset expires.
The assessee submitted that the issue
stands concluded in favour of the
appellant by the decision of the
For Private Circulations Only 6 The Update –Oct, 2016, SGCO & Co.
Karnataka High Court in Commissioner
of Income Tax Vs. K. Ramchandra Rao1
wherein an identical question came up
for consideration and it was held that
even where the assessee had not
deposited the un-utilized Capital Gain in
an account which was duly notified by
the Central Government in terms of
Section 54F(4) of the Act, the benefit of
Section 54F(1) of the Act would still be
available. The Court held that if the
intention was not to retain the capital
gains but was to invest it in construction
of property within the period stipulated
in Sub Section (1) of Section 54F of the
Act then Section 54F(4) of the Act is not
at all attracted.
The Hon’ble High court did not accept
the reasoning adopted by Karnataka
High Court in K. Ramchandra Rao
(supra) as in its view the decision was
sub-silentio. The Hon’ble High Court
held that the decision was not binding
on it and need not be necessarily
followed. It further held that the
1 (2015) 277 CTR 0522
mandate of Section 54F(4) of the Act is
clear that amount which has not been
utilized in construction and/or purchase
of property before filing the return of
income, must necessarily be deposited
in an account duly notified by the
Central Government, so as to be
exempted.
In view of above, the assessee was held
not to be eligible for exemption u/s.
54F.
Humayun Suleman Merchant v. CCIT (Bom
HC)2
-----------------------------------------------------
The AO must examine the accounts closely
and determine if at all any expenditure
could be ascribed to the tax exempt
dividend/interest earned by the assessee. If
the tax exempted income was earned
without the interference of any employee
the question of attributing any expenditure
cannot arise at all
Facts:
2 ITA NO.545 OF 2002
For Private Circulations Only 7 The Update –Oct, 2016, SGCO & Co.
The assessee reported a tax exempt
dividend income of Rs. 10,87,898 and he
had, however, not claimed any
expenditure for earning that income.
Purporting to apply the statutory
disallowance under Section 14A read
with Rule 8D of the Income Tax Rules, the
AO ascribed a sum of Rs. 1,21,805 and
added it back to the taxable income. The
assessee contended that the tax
exempted income in the form of interest
and dividends was without the
interaction of any special personnel. The
revenue on the other hand urged that the
assessee carries on business and in the
course of such business he engaged an
accountant who was also tasked with the
job of looking after the accounts and
investments which yielded a sum of Rs.
10,87,898.
Held:
Sub-rule (1) categorically and significantly
states that the Assessing Officer having
regard to the account of the assessee and on
not being satisfied with the correctness of
the claim of expenditure made by the
assessee or claim that no expenditure was
incurred in relation to income which does
not form part of the total income under the
Act, can go on to determine the disallowance
under sub rule (2) to Rule 8D of the Rules.
Sub-rule (2) will not come into operation
until and unless the specific precondition in
sub-rule (1) is satisfied. Thus, section 14A (2)
of the Act and rule 8D (1) in unison and
affirmatively state that the computation or
disallowance made by the assessee or claim
that no expenditure was incurred to earn
exempt income must be examined with
reference to the accounts, and only and
when the explanation/claim of the assessee
is not satisfactory, computation under sub
rule (2) to rule 8D of the Rules is to be made.
It was firstly incumbent upon the AO to in
fact examine the accounts closely and
determine if at all any expenditure could be
ascribed to the tax exempt dividend/interest
earned by the assessee. If indeed the tax
exempted income was earned without the
interference of any employee but rather
through the solicitation and advertisement
of the bank the question of attributing any
expenditure cannot arise at all.
For Private Circulations Only 8 The Update –Oct, 2016, SGCO & Co.
Pradeep Khanna vs. ACIT (Del HC)3
-----------------------------------------------------
S. 14A is applicable even where the motive
of the assessee in acquiring the shares is to
obtain controlling interest in a company
and not to earn dividends
Facts:
The question arose whether s. 14A
applies to a case where the motive
of the assessee is to acquire
controlling interest in a company
and not to earn dividends. The
Tribunal followed the judgement of
the Special Bench in ITO v. Daga
Capital Management Pvt. Ltd
(2009) 312 ITR (AT) 1 and held that
Held:
Assessing Officer to ascertain from
the facts of the case as to how
much interest bearing borrowings
was utilized to acquire shares in the
companies. In appeal by the
assessee to the High Court, the
following substantial question of
law was raised:
Whether in law, the provisions of
Section 14A of the Act are
applicable to the expenses incurred
by the appellant towards interest
and others on the loan borrowed for
advances made to the subsidiaries
in the course of business for its
expansion?
section 14A is applicable even
where the motive in acquiring the
shares was to obtain controlling
interest in the companies. The
Tribunal upheld in principle the
applicability of section 14A but
remanded the matter to the
The Tribunal after holding in principle the
applicability of Sec. 14A, has further
directed the Assessing Officer to
ascertain from the facts of the case as to
how much interest bearing borrowings
was utilized to acquire shares in the
companies and the matter is relegated to
3 ITA 953/2015
For Private Circulations Only 9 The Update –Oct, 2016, SGCO & Co.
the Assessing Officer. As per the language
in Sec.14A, the enquiry has to be
undertaken by the Assessing Officer
which has been so ordered by the
Tribunal. Hence, it can be said that the
Tribunal has exercised the discretion
where rights of both sides are kept open
for admissible deduction under Sec.14A.
When such a discretion is exercised and
the rights of the assessee is also kept
open to satisfy the Assessing Officer, it
cannot be said that any substantial
questions of law would arise for
consideration, as sought to be canvassed.
At the stage of enquiry under Sec.14A, it
is open to the Assessing Officer to
independently consider the matter for
admissibility of the interest on
borrowings and if yes to what extent.
Hence, when the question at large is
further to be considered by the Assessing
Officer, we do not find that any further
observations are required to be made in
this regard. In any case, the question of
law as sought to be canvassed would not
arise for consideration at this stage on
the said aspects as sought to be
canvassed.
United Breweries Ltd v. DCIT (Kar HC)4
-----------------------------------------------------
Expenditure incurred by a director in
engaging lawyers to defend himself against
cases filed for violation of the law by the
Company of which he is a director is not
personal expenditure but is allowable as
business expenditure
Facts:
The assessee debited an amount of
Rs.55,65,938/- under the head “legal
fees and related expenses”. In respect
of this expenditure, the assessee
explained to the Assessing Officer that
the assessee was Director on Board of
many companies including on the Board
of M/s. Nagarjuna Finance Ltd. This
company M/s. Nagarjuna Finance Ltd.
received fixed deposit from the public.
This company was charged with default
in repayment of fixed deposits and
interest thereon. The assessee had been
mentioned as one of the accused among
4 ITA No. 419 of 2009
For Private Circulations Only 10 The Update –Oct, 2016, SGCO & Co.
several others for non-payment of these
fixed deposits by M/s. Nagarjuna
Finance Ltd. The Andhra Pradesh
Government had filed suit against
directors of M/s. Nagarjuna Finance Ltd.
including against the assessee. To
defend himself, the assessee had
appointed various advocates to
represent his case before various courts
viz., District Court, High Court, Supreme
Court. The appellant paid fees to the
advocates and other expenses incurred.
The details of such expenses were
furnished by the assessee to the
Assessing Officer. The assessee argued
before the Assessing Officer that the
expenditure was incurred to protect his
business interest and, therefore, the
same should be fully allowable u/s.37(1)
of the Act. As per A.O. the expenditure
were personal in nature, he therefore
disallowed the same. This was
confirmed by the CIT(A).
Held
The expenditure is incurred by the
assessee in his character as a
professional and is not an expenditure
which is personal in nature. The
assessee has in his professional capacity
been a director of various limited
companies has earned professional fees
for the services rendered to these
companies. He was a director of
Nagarjuna Finance Limited (NFL) from
14-12-1982 to 28-04-1999. The assessee
has earned professional income during
all the years, he was, a director of NFL.
The assessee serves as an Independent
Director on the Board of several leading
Indian Companies such as Apollo Tyres
Limited, Britannia Industries Limited,
Deepak Nitrite Limited and KSB Pumps
Limited and also a member of various
Governing Boards of Centre for Policy
Research, Indian Institute of Capital
Markets, CII, SEBI etc. He regularly gets
sitting fees and commission from many
of these Companies. The assessee was
also an independent Director on the
board of Nagarjuna Finance Limited.
Nagarjuna Finance Limited had
collected Fixed Deposits from the
public. Nagarjuna Finance Limited was
charged with default in repayment of
For Private Circulations Only 11 The Update –Oct, 2016, SGCO & Co.
fixed deposits and interest thereon. Mr.
Nimesh Kampani has been mentioned
as one of the accused among several
others, for non-payment of these fixed
deposits by Nagarjuna Finance Limited.
The Andhra Pradesh Government had
since filed suit against directors of
Nagarjuna Finance Limited including Mr.
Kampani. To defend himself, Mr.
Kampani has appointed various
advocates to represent his case before
various courts viz, District Court, High
Court of Andhra Pradesh, Supreme
Court of India. As the expenditure is
incurred to protect his business interest
the same is required to be allowed u/s.
37(1) of the Act.
Nimesh M Kampani v. ACIT (ITAT Mumbai)5
----------------------------------------------------------
Compensation received by flat owner from
builder for hardship caused due to
redevelopment of the building is a non-
taxable receipt and has to be reduced from
the cost of the flat. Amount received from
builder to meet rental costs during the
redevelopment is also not taxable as
income
Held
As regards the corpus fund towards hardship
caused to assessee on redevelopment, the
same is in the nature of a capital receipt and
as such not taxable as held in Kushal K Bangia
vs. ITO ITA No.2349/Mum/2011. It was held
that it is elementary that the connotation of
income howsoever wide and exhaustive,
take into account only such capital receipts
which are specifically taxable under the
provisions of the Income Tax Act. Section
2(24)(vi) provides that income includes “any
capital gains chargeable under section 45”,
and, thus, it is clear that a capital receipt
simplicitor cannot be taken as income.
Hon’ble Supreme Court in the case of
Padmraje R. Kardambande vs CIT (195 ITR
877) has observed that “we hold that the
amounts received by the assessee during the
financial years in question have to be
regarded as capital receipts, and, therefore,
are not income within meaning of section
5 ITA No. 3316/Mum/2015
For Private Circulations Only 12 The Update –Oct, 2016, SGCO & Co.
2(24) of the Income Tax Act….” This clearly
implies, as is the settled legal position in our
understanding, that a capital receipt in
principle is outside the scope of income
chargeable to tax and a receipt cannot be
taxed as income unless it is in the nature of
revenue receipt or is brought within the
ambit income by way of a specific provision
in the Act. No matter how wide be the scope
of income u/s.2(24) it cannot obliterate the
distinction between capital receipt and
revenue receipt. It is not even the case of the
Assessing Officer that the compensation
received by the assessee is in the revenue
field, and rightly so because the residential
flat owned by the assessee in society
building is certainly a capital asset in the
hands of the assessee and compensation is
referable to the same. As held by Hon’ble
Hon’ble Supreme Court, in the case of Dr.
George Thomas K vs CIT(156 ITR 412), “the
burden is on the revenue to establish that
the receipt is of revenue nature” though
“once the receipt is found to be of revenue
character, whether it comes under
exemption or not, it is for the assessee to
establish”. The only defense put up by
learned Departmental Representative is that
cash compensation received by the assessee
is nothing but his share in profits earned by
the developer which are essentially revenue
items in nature. This argument however
proceeds on the fallacy that the nature of
payment in the hands of payer also ends up
determining its nature in the hands of the
recipient. As observed by Hon’ble Supreme
Court in the case of CIT vs. Kamal Behari Lal
Singha (82 ITR 460), “it is now well settled
that, in order to find out whether it is a
capital receipt or revenue receipt, one has to
see what it is in the hands of the receiver and
not what it is in the hands of the payer”. The
consideration for which the amount has
been paid by the developer are, therefore,
not really relevant in determining the nature
of receipt in the hands of the assessee.
However, the impugned receipt ends up
reducing the cost of acquisition of the asset,
i.e. flat, and, therefore, the same will be
taken into account as such, as and when
occasion arises for computing capital gains in
respect of the said asset. Subject to these
observations, grievance of the assessee is
upheld.
For Private Circulations Only 13 The Update –Oct, 2016, SGCO & Co.
Nothing contrary was brought to my
knowledge on behalf of Revenue. Facts
being similar, so following same reasoning,
consideration for which the amount has
been paid by the developer are, therefore,
not relevant in determining the nature of
receipt in the hands of the assessee. In view
of these discussions, in my considered view,
receipt could not be said to be of revenue
nature, and, accordingly, the same is outside
the ambit of income under section 2(24) of
the Act. The impugned receipt ends up
reducing the cost of acquisition of the asset,
i.e. flat, and, therefore, the same will be
taken into account as such, as and when
occasion arises for computing capital gains in
respect of the said asset. Subject to these
observations, the appeal of assessee is
allowed.
Next issue is regarding addition of amount
given by Developer for paying rent while
development of the project was taking
place. In fact, assessee submitted that he has
made expenditure of Rs.6,80,000/- towards
rent while development activity of the
project was taken place. So, assessing officer
is directed to allow the claim of assessee to
same extent because it is nothing but
compensation received by assessee for
paying rent. This cannot be said to be income
of assessee.
Jitendra Kumar Soneja vs. ITO (Mumbai
ITAT)6
----------------------------------------------------------
6 ITA No. 291/Mum/2015
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
16
INTERNATIONAL TAXATION
UC Berkeley Centre for Executive
Education, USA, In re [AAR No. 1623 of
2014] – Payment made to a university in
United States of America for providing
management training to India executives
shall not be treated as Fees for Technical
Services.
Facts of the Case:
The application was made by UC Berkeley Centre
for Executive Education (applicant), which is USA
based non-profit corporation formed for the
purpose of providing executive education to
management executives in USA and other
countries. The applicant had entered in to an
agreement with an Indian company to launch a
management programme for senior executives of
various corporations. The entire course materials
and other instructional material was to be
developed by the applicant and all intellectual
rights therein were reserved with it. The applicant
raised the following 2 questions before the
Authority of Advance Rulings (Income-Tax), New
Delhi:
1) Whether programme fee received by
the applicant in terms of the agreement
with the Indian Company was
chargeable to tax under Article 12 (Fees
for Included services) of the India – USA
DTAA and the provisions of section
9(1)(vii) (Fees for Technical services) of
the Income Tax act, 1961?
2) The activities of the applicant namely
teaching for 5 days would constitute a
Permanent Establishment (PE) under
Article 5 of the India – USA DTAA?
The Advance Authority of Rulings (AAR) Held as
under:
The applicant has submitted all the certificates
and other related documents which clearly
indicate that it is an educational institution and
its activities are charitable and educational
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
17
activities which covered by applicable laws in
USA.
Reference is made by AAR to its earlier decision
in the case of Eruditus Educational Private
Limited v/s DIT, wherein it was held that
educational institutions have been exempted
under clause 12(5)(c) of the India – Singapore
DTAA. Since, the said clause is identical to clause
12(5)(c) of the India – USA DTAA, the payment
received by the applicant shall not be treated as
Fees for Included Services under Article 12 and
shall not be subjected to withholding tax
implications.
Since, the payments are exempt under the India
– USA DTAA, the AAR refrained from ruling in the
context of the Income Tax Act, 1961.
-----------------------------------------------------------------
M.T. Maersk Mikage & 4 v/s Director of
Income Tax – Income earned by a shipping
company and taxable under Article 8 shall
not be ousted by Article 24(1) since the
income is assessable on accrual basis and
not on remittance basis.
Facts of the Case:
The assessee was a company based in
Singapore. Through the shipping business
carried out at Indian ports, the assessee
earned income, on which, it claimed
exemption from Indian income-tax by
relying upon article 8 of DTAA between India
and Singapore.
The Assessing Officer (AO) held that the
assessee was not entitled to benefit of
article 8 by virtue of the provisions
contained in article 24 as the freight receipts
were remitted to London and not to
Singapore. In his opinion, as per article 24 of
DTAA, the funds have to be remitted where
the resident of the country is claiming
benefit of the agreement which condition in
the instant case was not satisfied. The
commissioner upheld the order of the AO.
The assessee filed a petition before the High
Court.
The Gujarat High Court Held that:
The fact that the assessee was eligible to
claim the benefits of Article 8 of the DTAA
was not in dispute. The only question that
prevails is that whether article 8 is ousted by
virtue of clause (1) of Article 24 of the said
Treaty.
Article 24 pertains to limitation of relief.
Clause (1) of the said article provides that
the income from sources in contracting
states (in the present case, India) shall be
exempt from tax or shall be taxed at reduced
rate and under the laws in force in other
contracting states (i.e. Singapore), however
reference is on the amount thereof which is
remitted or received in that State and not by
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
18
reference to the full amount thereof, then
the exemption or reduction of tax under the
agreement would be limited to so much of
the income as is remitted to or received in
that contracting State.
In this context the certificate of the Inland
Revenue Authority of Singapore assumes
significance. The certificate states that the
income of the shipping company would be
assessable in Singapore on accrual basis and
not on receipt basis. In short, the entire
income of the company was taxable in
Singapore.
The essence of article 24(1) is that in case
certain income is taxed by a contracting
State not on the basis of accrual, but on the
basis of remittance. Applicability of article 8
would be ousted to the extent such income
is not remitted. When in the present case,
the income in question was not taxable at
Singapore on the basis of remittance but on
the basis of accrual; the very basis for
applying clause (1) of article 24 would not
survive.
-----------------------------------------------------------------
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For Private Circulations Only The Update –Oct, 2016, SGCO & Co
19
No Transfer Pricing adjustment should
be made on interest free advances to AE
owing to commercial consideration
Issue of Corporate Guarantee cannot be
considered as provision of service, it is
considered as a shareholder activity.
Facts
The assessee is a leading ink manufacturer in
India. It had a wholly owned subsidiary in
Austria, by the name of Micro Inks GmbH
which, in turn, owned Micro Ink Co., USA
(Micro USA). Micro USA manufactured printing
ink by using the base material supplied by the
assessee. The assesse company also had
trading subsidiaries in China and Hong Kong.
The international transactions reported by
the assessee in Form 3CEB for FY 2005-
2006(A.Y 2006-07) with Micro USA were sale
of goods and sale of packing material samples.
In addition to these transactions, the assesee
made a disclosure in the Form 3CEB that some
guarantees/ advances have been given by the
assessee which assisted the wholly owned
subsidiary to borrow funds from banks/
financial institutions. As per TP study carried
out by the assessee, advances issued by the
assessee on behalf of its AEs were said to be in
the nature of quasi capital and such advances
were provided without any charge.
In respect to transaction relating to sale of
good worth Rs. 215.51 crores to Micro USA.
The TPO noted that the assessee had allowed
its AE an average credit period of 186 days as
against average credit period of 130 days
allowed to independent parties, i.e., non-AEs.
It was also noted that out of total exports made
by the assessee, 45 per cent exports was to
Micro USA.
Also during the course of transfer pricing
proceedings, the TPO noted that the assessee
had issued various corporate guarantees on
behalf of its associated enterprises, i.e.,
subsidiaries.
TPO observed that guarantees were issued
without charging any price to the AEs. The
stand of the assessee was that those
guarantees did not cost assessee anything nor
any charges were recovered for the same, and
that the said guarantees were in the form of
corporate guarantees/quasi capital and not in
the nature of any services.
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
20
The TPO concluded the assessment
proceedings for the years under consideration,
the TPO proposed the following adjustments:
Interest free advances to the AEs
The Transfer Pricing Officer (TPO) was in
agreement with determination of arm’s length
price for sale transactions, however, he did not
agree with the approach of assessee for
determination of arm’s length price of
transaction involving advance to
AEs.
With r e s p e c t to interest free advances
by the assessee to Micro USA, the TPO held
that these advances were in the nature of
interest bearing advance and accordingly,
concluded that, based on the weighted
average cost of funds of assessee, 11 percent
p.a. was be charged as interest for the
advances to AEs.
Interest on excess credit period
The TPO held that the average credit period
allowed to AE was higher than the average
credit period allowed to the unrelated third
party customers. Accordingly, for the excess
days, the TPO charged interest at 11 percent
p.a. on the receivables from the AE.
Guarantee given to AE
The TPO held that Guarantees are chances that
someone will have to pay for them, if chance is
100 per cent, i.e. in all cases one has to pay for
it, guarantee fees will be simply equal to the
guarantee amount. However, if it is only a
probability, and only in few cases it will have to
be paid, its charges are just a percentage of it.
Banks normally compute guarantee charges on
the basis of their experience in handling such
situations.
Guarantees given by the assessee makes its own
borrowing costlier; as its assets get used in
guaranteeing, it has to raise costlier capital
without being able to use its own assets. There
cannot be a direct link to the guarantees given for
the purpose of computing cost, but the fact
remains that there was cost to the guarantor. In
view of the above discussions, guarantee fees was
calculated at two per cent, which was the
prevalent market rate for guarantee fees.
Thus TPO made an adjustment by computing
the arm’s length price (ALP) of the corporate
guarantee at two per cent
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
21
Aggrieved by the TPO order, the assessee filed
objections before the Dispute Resolution Panel
(DRP).
The DRP rejected the objection raised by the
assessee, referred to and relied upon the ‘OECD
Transfer Pricing Guidelines for Multinational
Permanent Establishments’ and the decision of
the Tax Court of Canada in the case of G E Capital
Canada3. The Assessing Officer (AO) thus
proceeded to make the ALP adjustment in respect
of corporate guarantee at INR2.32Crores.
Assessee’s contentions before the ITA
Interest free advances to the AEs
The assessee contended that under the
peculiar facts of the case, the advances
given to Micro USA were akin to the
shareholder’s funds. The assessee was a new
entrant in the US market and was facing a stiff
competition due to which it had suffered huge
losses. Accordingly, it was necessary for the
assessee to increase its capital support in
order to provide capital base of Micro USA.
It was further explained by the assessee
that its intention was always to fund the
subsidiary through equity capital. However,
equity investment in the foreign subsidiary
required prior approval from Reserve Bank of
India (RBI). Such approval is not required for
giving advance to a foreign subsidiary.
Therefore, the assessee gave advance to the
foreign subsidiary a n d on receipt of
approval from RBI; it converted the advances
into equity capital.
Further, the assessee contended that the
funds so advanced to Micro USA did not have
any costs so far as the assessee was concerned,
and that in any event, at best such cross
border loans in US dollars were available at the
LIBOR.
Interest on excess credit period
The assessee submitted that material
being supplied to Micro USA, i.e. semi-finished
goods, ingredients and raw materials were not
being sold to any other enterprise, and, as
such, comparison was not possible.
T
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
22
T
The assessee also mentioned that it was
required to keep an inventory of these
products at Micro USA, and that 92 percent of
its entire exports, as also 50 percent of its
entire sales, were to Micro USA.
Guarantee given to AE
Transfer pricing report categorically stated
that ‘guarantees issued by the assessee are
said to be in form of corporate
guarantees/quasi capital and not in the nature
of services’ and that accordingly, ‘these
transactions are not considered as
international transactions’.
Assessee relied on the decision of Bharti Airtel1
which held that corporate guarantee issued for
the benefit of Associated Enterprise (AE), not
involving any costs to the assessee and not
having any bearing on profits, income, losses
or assets of enterprise, are required to be kept
outside the ambit of ‘international transaction’
and the coordinate bench of the ITAT, has in a
number of cases followed the same
proposition.
1 Bharti Airtel Limited Vs ACIT(2014)63 SOT 113 (Del)
The assessee further argued to the question of
the Tribunal as to why issuance of corporate
guarantee cannot be treated as intra group
services in the light of the OECD guideline; that
the issuance of corporate guarantee cannot be
treated as a service and even if it treated as a
service, in order to come within the ambit of
international transaction,
the service should have ‘a bearing on profits,
income, losses or assets of the enterprise’ and
the said condition is not fulfilled in the present
case.
It was further submitted that the revenue
authorities cannot lean to the OECD guidelines
when the plain words of the statute are in
favor of the assessee.
Tax department’s contentions
Interest free advances to the AEs
It was evident from the disclosure made in
Micro USA financial accounts, that the amount
received by Micro USA was in the nature of an
interest bearing advance and interest was
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
16
in the nature of an interest bearing advance
and interest was actually paid on it. Therefore,
it was wrong to claim that the amount
advanced was of capital nature. The
relationship between the assessee and Micro
USA was of the borrower and lender, and,
therefore, transaction, such business
expediency would not take the transaction
outside the ambit of transfer pricing
provisions.
The assessee’s contention to the effect that if
at all ALP of interest was to be computed it
should be LIBOR or the American bank rate
was rejected on the ground that the loans by
Indian banks were granted on the basis of
security given by the assessee and such loans
were not comparable, and that the US interest
rate would not be applicable as margins were
charged by the US banks over and above the
same.
Based on the above contentions, the Revenue
held that the weighted average cost of funds
of assessee i.e. 11 percent p.a. should be
charged as interest on the advances to AEs.
2 GE Capital Canada vs Her Majesty the Queen (2009) TCC 563
Interest on excess credit period
The tax department did not accept the
contentions of the assessee with respect to
interest on excess credit period transaction.
Taking 120 days as the permissible credit
period, interest at 11 percent p.a. should be
charged as interest on dues from AEs on
excess credit period.
Guarantee given to AE
The DRP, in his directions, had referred and
relied upon the decision of tax court of Canada
in case of G E Capital Canada2, wherein the DRP
noted that the group company issuing the
guarantee (i.e. the guarantor) would, in
principle, at least need to cover the cost that it
incurs with respect to providing the guarantee,
and these costs may include administrative
expenses as well as the costs for maintaining
an appropriate level of cash equivalents,
capital, subsidiary credit lines or more
expensive external funding conditions on other
debt finance. In addition, the guarantor would
want to receive the appropriate compensation
for the risk it incurs.
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
17
fee is included in the
expression ‘international transaction’ in view
of the Explanation i(c) of Section 92B of the
Act, by the amendment brought by the Finance
Act, 2012 with retrospective effect, and the
same has been approved by the Bombay High
Court.
The tax department further also relied on the
decision of Vodafone India Services Limited3
which holds that the effect of the amendment
will have to be considered and cannot be
brushed aside.
The tax department argued that in case of Bharti
Airtel, which was relied on by the assessee, it was
not requested by the contesting parties to decide
whether the provision of guarantee fee was a
service or not and added that ’various Tribunal
decisions have already held that provision for
bank guarantee is a service and, as such, it needs
to be benchmarked’ and that ‘whether the
service has caused any extra cost to the assessee
should not be the deciding factor to determine
whether it is an international transaction’
Held
3 Vodafone India Service Limited Vs Union Of India(2013) 37
Interest free advances to the AEs
Based on the below mentioned reasons, the
Tribunal agreed with the assessee’s
contention that there should be no interest on
the advances given to AE in the case under
consideration based on the commercial and
business considerations involved:
The first important aspect of this interest free
advance was that the advance is said to be in
the nature of quasi capital. The Tribunal
agreed that it was not open to the assessee to
subscribe to the equity capital without prior
obtaining approval from RBI. The Tribunal also
noted that immediately upon obtaining the
permission of the RBI, the advances were
converted into shares.
Secondly, Micro USA was not only a wholly
owned subsidiary of the assessee but was also
playing a very significant role in its sale and
distribution chain in as much as the assessee
was sole vendor to the said concern so far as
sales of raw material and semi-finished
goods were concerned. There was a significant
trade between the assessee and Micro USA to
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
16
to show case business expediency hence,
relationship on account of lending of money
could not thus be considered in isolation
without considering crucial business
considerations.
The Tribunal also analysed that in case arm’s
length price had to be determined in such
transactions, Comparable Uncontrolled Price
(CUP) method could be applied, and LIBOR or
any other bank linked rate was generally taken
as a rate for comparable uncontrolled
transaction. In this regard, the Tribunal held
that typical LIBOR plus rate related to
transactions in which banks made advances
with a motive of making profits from
lending activities. However, in the assessee’s
case, the rationale for advancing amounts
was in lieu of pending RBI approvals in
connection with its equity infusions.
Accordingly, there was no parity between
these two types of transactions. Secondly, in
this case, the two enterprises were mutually
dependent for commercial reasons. While
Micro USA was dependent on the assessee for
its sheer existence, the assessee was
dependent on Micro USA for its business.
Further, the Tribunal held that on the basis of
pure commercial factors and notwithstanding
the management, capital and control
relationship between the parties, such non-
interest bearing advances were equally
justified even if the assessee and Micro USA
were independent enterprises.
Interest on excess credit period
The Tribunal held that this adjustment must
be deleted due to the following reasons:
The transaction was part of the arrangement
for which specified credit period was allowed
and thus the cost of funds blocked in the credit
period was inbuilt in the sale price.
The products sold by the assessee to the AE
were not sold to the third parties.
Accordingly, the credit period for finished
goods cannot be compared with credit period
for unfinished goods and raw materials.
The Tribunal observed that similar issues have
already been covered by the decision in the
case
Of Micro Inks Ltd9. Wherein the Ahmedabad
Tribunal observed that similar products are not
sold to any other concern, at the same price or
even any other price and interest is levied on
the similar credit period allowed to those
independent parties, but not to Micro USA.
The question of
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
17
Excess credit period arises only when there is a
standard credit period for the product sold at
the
same price and the credit period allowed to
the
AEs is more than the credit period allowed to
independent enterprises. That is not the case
here. The credit period for finished goods
cannot be compared with credit period for
unfinished goods and raw materials, and in any
case, when products are not the same, there
cannot be any question of prices being the
same.
Guarantee given to AE
The Tribunal held that issuance of corporate
guarantee was in the nature of ‘Shareholder
Activities’/‘quasi capital’ and thus could not be
included within the ambit of ‘provision of
services’ under the definition of ‘international
transaction’ under Section 92B of the Act.
It distinguished the revenue’s reliance on
Bombay High Court judgment in Everest Kanto
wherein Guarantee commission was actually
charged by the assessee, unlike in the present
case. The grievance against the issuance of
corporate guarantee being held to be an
international transaction could not have come
up for consideration.
In the case of Vodafone India Services,
applicability of retrospective amendment to
Section 92B of the Act had been considered in
context of ‘transfer’ and not ‘international
transaction’. The amendment clarifies the two
aspects of transfer - the asset itself and the
manner in which it is dealt with. The issue
considered by the High Court was prior to the
amendment, whereas in the present case, it is
the amended definition which would have to
be considered. In the present case, we do not
find either necessary or proper to indicate the
application of Section 2(47) of the Act as
amended to the present proceedings. In view
of the above
discussions, the decision is equally misplaced
and devoid of legally sustainable merits.
Further, the Tribunal also distinguishes the
Canadian decision of G E Capital Canada relied
upon by the revenue authorities stating The same
did not even deal with the fundamental question
as to whether issuance of Corporate guarantee is
an international transaction at all and the
provisions of the Act and the Canadian Income Tax
Act, 1985 are so radically different that just
because a particular transaction is to be
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
18
examined on ALP in Canada, that alone cannot be
a reason enough to hold that it must meet the
same in India as well.
The Tribunal held that revenue cannot seek to
widen the net of transfer pricing legislation by
taking refuge of the best practices recognised
by the OECD work.
The Tribunal analyzed the business model of
bank guarantees, with which corporate
guarantee are sometimes compared, in the
context of benchmarking the ALP of corporate
guarantee. A bank guarantee is a surety that
the bank, or the financial institution issuing the
guarantee, will pay off the debts and liabilities
incurred by an individual or a business entity in
case they are unable to do so. Even when such
guarantees are backed by one hundred
percent deposits, the bank charges a
guarantee fees. Whereas in case of corporate
guarantees, it is issued without any security or
underlying assets. There is no recourse
available with the guarantor if there is any
default. Such guarantees are issued based
upon the business needs and not risk
assessment or underlying asset which
generally the bank asks for. In general,
therefore, bank guarantees are not
comparable with corporate guarantees.
Further relying on the decision of EKL
Appliances, states that even if issuance of
corporate guarantee is accepted as ‘provision for
service’, such service needed to be re-
characterized to bring it to tune with commercial
reality, as ‘no independent enterprise would
issue a guarantee without an underlying security
as has been done by the assessee’ and also states
that issuance of corporate guarantees is covered
by the residuary clause of Section 92B definition.
However, in the decision in Bharti Airtel, the
Delhi Tribunal has explained in detailed, the
legal position of the Section 92B of the Act and
has specifically brought that the onus is on the
Revenue to demonstrate that the transaction
is of such nature so as to have a bearing on its
profits, income, losses or assets. Such impact
should be on a real basis and not on contingent
or hypothetical basis. These conditions are not
satisfied in the present case. It was held that,
‘when the assessee extends an assistance to
the AE, which does not cost anything to the
assessee and particularly for which the
assessee could not have realized money by
giving it to someone else during the course of
its normal business, such an assistance or
accommodation does not have any bearing on
its profits, income, losses or assets, and,
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
19
therefore, it is outside the ambit of
International transaction under Section 92B
(1)of the Act’ and deletes transfer pricing
adjustment.
The shareholder activity as it was to provide,
or compensate for lack of, core strength for
raising the finances from banks. No material,
indicating to the contrary, is brought on record
in this case.
Going by the OECD Guidance also, it is not
really possible to hold that the corporate
guarantees issued by the assessee were in the
nature of 'provision for services' and not a
shareholder activity which are mutually
exclusive in nature. In the light of these
discussions, it is opined and said view is fully
supported by the OECD Guidance in this, that
the issuance of corporate guarantees, in the
nature of quasi capital or shareholder activity
as is the uncontroverted position on the facts
of this case, does not amount to a service in
which respect of which arm's length
adjustment can be done.
It is thus clear that even if one accepts the
contention of the revenue that issuance of a
corporate guarantee amounts to a 'provision
for service’, such a service needs to be
characterized to bring it in tune with
commercial reality as 'arrangements made in
relation to the transaction, viewed in their
totality, differ from those which would have
been adopted by independent enterprises
behaving in a commercially rational manner'.
No bank would be willing to issue a clean
guarantee, i.e., without underlying asset, to
assessee's subsidiaries when the banks are not
willing to extend those subsidiaries loans on
the same terms as without a guarantee. Such a
guarantee transaction can only be, and is,
motivated by the shareholder, or owner-wise
considerations.
No doubt, under the OECD Guidance on the
issue, an explicit support, such as corporate
guarantee, is to be benchmarked and, for that
purpose, it is in the service category but that
occasion comes only when it is covered by the
scope of 'international transaction' under the
transfer pricing legislation of respective
jurisdiction. The expression 'provision for
services' in its normal or legal connotations, as
seen earlier, does not cover issuance of
corporate guarantees, even though once a
corporate guarantee is covered by the
definition of international transaction', it is
benchmarked in the service segment. In view
of the above, OECD Guidelines, as a matter of
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
20
fact, strengthen the claim of the assesse that
the corporate guarantees issued by the
assessee were in the nature of quasi capital or
shareholder activity and, for this reason alone,
the issuance of these guarantees should be
excluded from the scope of services and thus
from the scope of 'international transactions'
under section 92B.
Once a transaction is held to be covered by the
definition of international transaction,
whether in the nature of the shareholder
activity or quasi capital or not, ALP
determination must depend on what an
independent enterprise would have charged
for such a transaction. In this light of these
discussions, it is held that the issuance of
corporate guarantees in question was not in
the nature of 'provision for services' and these
corporate guarantees were required to be
treated as shareholder participation in the
subsidiaries.
As for the words 'provision for services"
appearing in section 92B, and connotations
thereof, this expression, in its natural
connotations, is restricted to services
rendered and it does not extend to the
benefits of activities per se. Whether one looks
at the examples given in the OECD material or
even in Explanation to section 92B, the thrust
is on the services like market research, market
development, marketing management,
administration, technical service, repairs,
design, consultation, agency, and scientific
research, legal or accounting service or
coordination services. As a matter of fact, even
in the Explanation to section 92B guarantees
have been grouped in item 'c' dealing with
capital financing, rather than in item 'd' which
specifically deals with 'provision for services'.
When the legislature itself does not group
'guarantees' in the 'provision for services' and
includes it in the 'capital financing', it is
reasonable to proceed on the basis that
issuance of guarantees is not to be treated as
within the scope of normal connotations of
expression 'provision for services'.
Under section 92B, corporate guarantees can
be covered only under the residuary head i.e.
"any other transaction having a bearing on the
profits, income, losses or assets of such
enterprise". It is for this reason that section
92B, in a way, expands the scope of
international transaction in the sense that
even when guarantees are issued as a
shareholder activity but costs are incurred for
the same or, as a measure of abundant
caution, recoveries are made for this non-
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
21
chargeable activity, these guarantees will fall
in the residuary clause of definition of
international transactions under section 92B.
As for the revenues argument that "whether
the service has caused any extra cost to the
assesse should not be the deciding factor to
determine whether it is an international and
then gives an example of brand royalty to
make his point.What, in the process, he
overlooks is that is that section 92B(1)
specifically covers sale or lease of tangible or
intangible property". The expression "bearing
on the profits, income, losses or assets of such
enterprises" is relevant only for residuary
clause i.e. any other services not specifically
covered by section 92B.
There is no dispute that Explanation to section
92B states that it is merely clarificatory in
nature in as much as it is 'for the removal of
doubts',and, therefore, one has to proceed on
the basis that it does not alter the basic
character of definition of 'international
transaction' under section 92B. Accordingly,
this Explanation is to be read in conjunction
with the main provisions, and in harmony with
the scheme of the provisions, under section
92B. Under this Explanation, five categories of
transactions have been clarified to have been
included in the definition of 'international
transactions'. The first two categories of
transactions, which are stated to be included
in the scope of expression 'international
transactions' by the virtue of clause (a) and (b)
of Explanation to section 92B, are transactions
with regard to purchase, sale, transfer, lease or
use of tangible and intangible properties.
These transactions were anyway covered by
transactions 'in the nature of purchase, sale or
lease of tangible or intangible property'.
The only additional expression in the
clarification is 'use' as also illustrative and
inclusive descriptions of tangible and
intangible assets.Similarly, clause (d) deals
with the “provision of services, including
provision of market research, market
development, marketing management,
administration, technical service, repairs,
design, consultation, agency, scientific
research, legal or accounting service" which
are anyway covered in "provision for services"
and "mutual agreement or arrangement
between two or more associated enterprises
for the allocation or apportionment of, or any
contribution to, any cost or expense incurred
or to be incurred in connection with a benefit,
service or facility provided or to be provided to
any one or more of such enterprises ".
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
22
That leaves the Tribunal with two clauses in
the Explanation to section 92B which are not
covered by any of the three categories
discussed above or by other specific segments
covered by section 92B, namely borrowing or
lending money. The remaining two items in the
Explanation to section 92B are set out in clause
(c) and (e) thereto, dealing with (a) capital
financing and (b) business restructuring or
reorganization. These items can only be
covered in the residual clause of definition in
international transactions, as in section 92B(1),
which covers "any other transaction having a
bearing on profits, incomes, losses, or assets of
such enterprises". It is, therefore, essential
that in order to be covered by clause (c) and (e)
of Explanation to Section 92B, the transactions
should be such as to have beating on profits,
incomes, losses or assets of such enterprise. In
other words, in a situation in which a
transaction has no bearing on profits, incomes,
losses or assets of such enterprise, the
transaction will be outside the ambit of
expression 'international transaction'. This
aspect of the matter is further highlighted in
clause (e) of the Explanation dealing with
restructuring and reorganization, wherein it is
acknowledged that such an impact could be
immediate or in future as evident from the
words "irrespective of the fact that it (i.e.
restructuring or reorganization) has bearing on
the profit, income, losses or assets of such
enterprise at the time of transaction or on a
future date". What is implicit in this statutory
provision is that while impact on " profit,
income, losses or assets" is sine qua non, the
mere fact that impact is not immediate, but on
a future date, would not take the transaction
outside the ambit of 'international
transaction'. It is also important to bear in
mind that, as it appears on a plain reading of
the provision, this exclusion clause is not for
'contingent' impact on profit, income, losses or
assets but on 'future' impact on profit, income,
losses or assets of the enterprise.
The important distinction between these two
categories is that while latter is a certainty, and
only its crystallization may take place on a
future date, there is no such certainty in the
former case. In the instant case it is an
undisputed position that corporate guarantees
issued by the assessee to the various banks
and crystallization of liability under these
guarantees, though a possibility, is not a
certainty. In view of the discussions above, the
scope of the capital financing transactions, as
could be covered under Explanation to section
92B read with section 92B(1), is restricted to
such capital financing transactions, including
For Private Circulations Only The Update –Oct, 2016, SGCO & Co
23
inter alia any guarantee, deferred payment or
receivable or any other debt during the course
of business, as will have "a bearing on the
profits, income, losses or assets or such
enterprise".
This precondition about impact on profits,
income, losses or assets of such enterprises is
a precondition embedded in section 92B(1)
and the only relaxation from this condition
precedent is set out in clause (e) of the
Explanation which provides that the bearing
on profits, income, losses or assets could be
immediate or on a future date. These
guarantees do not have any impact on income,
profits, losses or assets of the assessee. There
can be a hypothetical situation in which a
guarantee default takes place and, therefore,
the enterprise may have to pay the guarantee
amounts but such a situation, even if that be
so, is only hypothetical situations, which are,
as discussed above, excluded. When an
assessee extends an assistance to the
associated enterprise, which does not cost
anything to the assessee and particularly for
which the assesse could not have realized
money by giving it to someone else during the
course of its normal business, such an
assistance or accommodation does not have
any bearing on its profits, income, losses or
assets, and, therefore, it is outside the ambit of
international transaction under section 92B(1).
In the present case, as already held that the
issuance of corporate guarantees were in the
nature of shareholder activities as was the
uncontroverted claim of the assessee, and, as
such, could not be included in the 'provision for
services' under the definition of 'international
transaction' under section 92B. Taking note of the
insertion of Explanation to section 92B, that the
issuance of corporate guarantees is covered by
the residuary clause of the definition under
section 92B of the Act but since such issuance of
corporate guarantees, on the facts of the present
case, did not have "bearing on profits, income,
losses or assets", it did not constitute an
international transaction, under section 92B, in
respect of which an arm's length price
adjustment could be made. In this view of the
matter, and for both these independent reasons,
the impugned ALP adjustment is set aside.
Micro Ink Limited vs Additional CIT (I.T.A No:-
2873/AHD/10)
For Private Circulations Only 24 The Update –Oct, 2016, SGCO & Co.
CUSTOMS
*CUSTOMS-TARIFF*
Extension of date for applicability of
Standard rate, additional duty rate or any
condition on Butter, Ghee & Butter Oil.
The Central Government, being satisfied that it is
necessary in the public interest so to do, hereby
makes the following further amendment in
Notification No.12/2012 -Exemption of Additional
Duty & effective rate of basic and additional duty
for goods specified as below.(TABLE).
The amendment is in Notification No-53/2016-
Cust, dt-29/09/2016 as namely-
In case of Butter ,ghee and butter oil the standard
rate is30% and there is no additional duty ,Earlier
the date for the applicability of such notification
was till 30th September,2016 ,now it has been
extended till 31st March,2017.
Hence, Duty on import of goods mentioned in
Table is at Standard rate of 30% , no additional
duty & no condition is mentioned.
TABLE-
S.No Chapter or Heading or Sub heading or tariff item
Description of goods
Standard rate
Additional duty rate
Condition No.
8 0405
Butter ,ghee and butter oil
30%
- -
Notification No. 53/2016-Customs, Dated- 29th
September, 2016.
---------------------------------------------------------
Inclusion of two ICDs in list of Customs
stations from where Export/Import under
EP schemes can take place
For Private Circulations Only 25 The Update –Oct, 2016, SGCO & Co.
The amendment is in Notification No-54/2016-
Cust, dt-03/10/2016 as namely-
The Central Government makes the following
amendment
In case, where Export/Import were done under
“Export Promotion schemes” ,the exemption from
the levy of custom duty is allowed, if the said
Export/Import were take place from the Inland
Container Depot mentioned in the list of Custom
stations. Hence In addition to Custom station
named “Hosur (Tamil Nadu) and Nattakkam Village
(Kottayam Taluk and District)”, the Village named
as Kalinganagar and Tumb Village (Taluka
Umbergaon, District Valsad)” are added.
Notification No. 54/2016-Customs, dated-03rd
October, 2016
---------------------------------------------------------
Change in Entry no. of Goods named
‘Technitium-99m’ as mentioned below;-
The amendment is in Notification No-55/2016-
Cust, dt-03/10/2016 as namely-
Goods named as “Technitium-
99m” was earlier covered under Diagnostic test
kit under s.no.148/516.
But now In Notification No.55/2016- There is a
amendment & Technitium-99m will get inserted in
Table as entry no.163B.
Notification No. 55/2016-Customs, Dated-03rd
October, 2016.
---------------------------------------------------------
Reduction in no. of days for execution of a
bond in the case of import of gold / silver /
platinum under the scheme for 'Export
Against Supply by Nominated Agencies-
The amendment is in Notification No-56/2016-
Cust, dt-03/10/2016 as namely
Exemption in case of import of gold / silver /
platinum, Provided that;-
S.No Chapt
er or
Headi
ng or
Sub
headi
ng or
tariff
item
Description of
goods
Stan
dard
rate
Ad
diti
on
al
dut
y
rat
e
148 28,29,
30,38
(A) Life saving
drugs / medicines
including their
salts and esters
and diagnostic
test kits specified
in List 4
NIL -
For Private Circulations Only 26 The Update –Oct, 2016, SGCO & Co.
In the case of import of gold / silver / platinum
under the scheme for 'Export Against Supply by
Nominated Agencies', the importer executes a
bond in such form and for such sum within a
“period of ninety days” from the date of issue of
gold / silver / platinum to the exporters, and
binding himself to pay on demand duty on quantity
of gold / silver / platinum representing the
difference between the quantity issued and that
contained in the exported jewellery or articles.”.
Earlier the period of execution of a bond is 120
days which get reduced to 90 days.
Notification No. 56/2016-Customs, Dated-03rd
October, 2016.
---------------------------------------------------------
Extension in days to reimport of machinery
and equipment in Bhutan earlier exported
under duty drawback, rebate or bond -
The amendment is in Notification No-57/2016-
Cust, dt-03/10/2016 as namely-
Earlier the reimports of exported goods is allowed
within 3 years; (further 2 years showing show
cause notice)of all Goods other than DEEC, EPCG,
DEPB.
In case of DEEC, EPCG, DEPB- Reimports can be
made within 1 year (further 1 year by showing
show cause notice). But now a new concept has
been inserted to provide relaxation to Bhutan
.i.e.-
In case of Bhutan-,Machinery & Equipment
(except export under DEEC,EPCG,DEPB) -
Reimports of goods can be made within 7 years of
such export extending 3 years after that by
showing show cause notice.
Notification No. 57/2016-Customs,
Dated-03rd October, 2016.
---------------------------------------------------------
S.
No
Cha
pter
or
Hea
ding
or
Sub
hea
ding
or
tarif
f
item
Descri
ption
of
goods
Stan
dard
rate
Additi
onal
duty
rate
Condi
tion
No.
16
3B
284
4
Techni
tium-
99m
NIL - -
For Private Circulations Only 27 The Update –Oct, 2016, SGCO & Co.
Makes further amendments to Notification
no. 157/90-Customs dated 28th March, 1990
regarding temporary admission under the
ATA Carnet
The amendment is in Notification No-58/2016-
Cust, dt-03/10/2016 as namely-
Notification No. 157/2016 dated 28/03/16:-
exemption to specified goods imported for display
or use at any specified event such as meetings,
exhibitions, fairs or similar show or display.
Includes the below matters which now has been
amended
The following has been omitted:-
Schedule III – Display or demonstration before any
department before any department of Central
Government or a State Government or a Union
Territory Administration.
Condition (1) -- The event specified in Schedule II is
being held in public interest and is sponsored or
approved by the Government of India or the India
Trade Promotion Organization
Condition (5)-- In the event of failure to export the
goods within the period specified in condition (4),
the customs duty leviable on the goods as on the
date of clearance shall be paid by the Federation:
In the event of failure to export the goods within
the period specified in condition (4) of paragraph
1, the Federation and the importer shall, jointly
and severally be liable to pay the duties of
customs leviable on the goods as on the date of
import, along with applicable interest:
Notification No. 58/2016-Customs,Dated-03rd
October, 2016
---------------------------------------------------------
*CUSTOMS-ANTI DUMPING DUTY*
Extension of impose of anti-dumping duty
on Narrow woven Fabrics [Hook and Loop
Velcro Tapes] of specified types, originating
in or exported from People’s Republic of
China for a period of five years.
The Central Government had extended the anti-
dumping duty imposed on the subject goods
originating in, or exported from, the subject
country vide notification No. 50/2016-Customs
(ADD), dated the 06th October, 2016,
** Including fully processed but uncut hook and
loop tape fasteners. This will however, not include
unprocessed, un-bonded, uncut and un-brushed
narrow woven fabrics.
The same can be viewed at below mentioned link:-
For Private Circulations Only 28 The Update –Oct, 2016, SGCO & Co.
http://www.cbec.gov.in/resources//htdocs-
cbec/customs/cs-act/notifications/notfns-
2016/cs-add2016/csadd50-2016.pdf
Notification No. 50/2016-Customs,
Dated-06th October, 2016.
---------------------------------------------------------
*Customs-Non-Tariff*
Adding of Land Customs Stations and Routes
named as Foreign Post office at Vijayawada,
Leh and Hyderabad-NotificationNo.-
125/2016-DT-13/10/2016.
Amendment in the Notification No-63/94-Cust-
dt-21/11/1994- Land Customs Stations and
Routes for import and export of goods by land or
inland water ways.
The Central Government has inserted the places
mentioned in below Table as Land Customs Station
for the clearance of all goods or any class of goods
imported or exported by land from or to the land
frontiers of the said table; routes as the routes by
which alone all goods or class of goods may pass
by land or inland water into or out of India to the
said land frontiers.
S.No. Land Frontiers
Land Customs Stations
Routes
8. All Countries
Sub-Foreign Post office at Vijayawada; (11)
Sub-Foreign Post office at Leh. (12)
Sub-Foreign Post office at Hyderabad. (13)
Notification No. 125/2016-Customs, Dated-13th
October, 2016.
---------------------------------------------------------
The Central Board of Excise and Customs
hereby determines the rate of exchange of
conversion of each of the foreign currencies
applicable with effect from 07th October,
2016-
The Central Government hereby determines the
rate of exchange of conversion of each of the
foreign currencies applicable with effect from
21st October, 2016-vide notification No.
127/2016-Customs, dated the 20th October, 2016
SCHEDULE I-
SCHEDULE II-
For Private Circulations Only 29 The Update –Oct, 2016, SGCO & Co.
No.
Foreign
Currency
Rate of exchange of 100 units of foreign currency equivalent to Indian rupees
(1) (2) (3)
(a) (b)
(For
Importe
d
Goods)
(For
Export
Goods)
1 Australian Dollar 52.20 50.40
2 Bahrain Dinar 183.20
170.95
3 Canadian Dollar 51.60 50.00
4 Danish Krone 10.05 9.65
5 EURO 74.50 72.00
6 Hong Kong Dollar 8.70 8.50
7 Kuwait Dinar 227.90
213.25
8 New Zealand
Dollar
49.35 47.45
9 Norwegian Kroner
8.35 8.05
10 Pound Sterling 83.45 80.70
11 Singapore Dollar 48.90 47.30
12 South African Rand 5.00 4.65
13 Saudi Arabian Riyal 18.40 17.20
14 Swedish Kroner 7.70 7.40
15 Swiss Franc 68.60 66.40
16 UAE Dirham
18.75 17.60
17 US Dollar 67.55 65.90
18 Chinese Yuan 10.05 9.75
Notification No. 127/2016-Customs, Dated-21st
October, 2016
---------------------------------------------------------
Tariff Notification in respect of Fixation of
Tariff Value of Edible Oils, Brass Scrap, Poppy
Seeds, Areca Nut, Gold and Silver-
The Central Board of Excise & Customs, being
satisfied that it is necessary and expedient so to
do, hereby makes the following amendment in
the Notification No. 126/2016-CUSTOMS (N.T.)
dated the 14th October, 2016.
Sr.
No.
Foreign
Currenc
y
Rate of exchange of
100 units of foreign
currency equivalent
to Indian rupees
111
111
111
112
111
1)
2 3
(a)
(For Imported
Goods)
1. Japanes
e Yen
65.55
2. Kenya
Shilling
68.05
For Private Circulations Only 30 The Update –Oct, 2016, SGCO & Co.
Sr.
No
.
Chapter
/headin
g/sub-
heading
/tariff
item
Description of
Goods
Tar
iff
Val
ue
(US
$Pe
r
Me
tric
Ton
ne)
(1) (2) (3) (4)
1 1511 10
00
Crude Palm Oil 704
2 1511 90
10
RBD Palm Oil 724
3 1511 90
90
Others- Palm Oil 714
4 1511 10
00
Crude
Palmolein
737
5 1511 90
20
RBD
Palmolein
740
6 1511 90
90
Others-
Palmolein
739
7 1507 10
00
Crude Soya
bean Oil
845
8 7404 00
22
Brass Scrap ( all
grades)
3028
9 1207 91
00
Poppy seeds 2533
Sr.
No
.
Chapter
/headin
g/sub-
heading
/tariff
item
Desc
riptio
n of
Good
s
Tariff Value
(US
$)
(1) (2) (3) (4)
1 71 or 98 Gold 410 per 10
grams
2 71 or 98 Silve
r
576 per
kilogram
Notification No. 126/2016-
Customs,Dated-14th October, 2016.
- ------------------------------------------------
DGFT
Public Notice
Export of sugar to European Union (EU) under
CXL Quota and export of sugar to USA under
TRQ is ‘free’ subject to the conditions notified
in the ‘Nature of Restriction’ and 20% Export
Duty applicable on export of raw sugar, white
or refined sugar w.e.f 16 June 2016.
Sr.
No
.
Chapter/h
eading/sub-
heading/tar
iff item
Descrip
tion of
Goods
Tariff
Value
(US $
per
metri
c
tonne
)
(1) (2) (3) (4)
1 080280 Areca
Nuts
2621
For Private Circulations Only 31 The Update –Oct, 2016, SGCO & Co.
In addition to the aforesaid condition, DGFT
notified 10,000 tons of white sugar to be exported
to EU under CXL Quota upto 30/09/2017.
DGFT Public Notice No. 34/ 2015-2020 dated 28
September, 2016
----------------------------------------------------------
The new regional office of DGFT at Belagavi,
Karnataka is included in the Appendix 1-A (List of
Regional Authorities and their jurisdiction) of
Foreign Trade Policy, 2015-2020.
DGFT Public Notice No. 36/ 2015-2020 dated 28
September, 2016
----------------------------------------------------------
The export performance of Gems and Jewellery
items from SEZ/EOU Units shall not be clubbed
with export performance from DTA units of any IEC
Holder for grant of Nominated Agency Certificate.
DGFT Public Notice No. 37/ 2015-2020 dated 4
October, 2016
----------------------------------------------------------
The procedure for designated ports for imports of
un-shredded Metallic Waste & Scrap and handling
of un-shredded Metallic Waste & Scrap by ICD’s (
Inland Container Depot ) is prescribed and this can
be referred on the following link :
http://dgft.gov.in/Exim/2000/PN/PN16/PN.3816.
DGFT Public Notice No. 38/ 2015-2020 dated 6
October, 2016 and 40/ 2015-2020 dated 25
October, 2016
----------------------------------------------------------
Inclusion of Inland Container Depot located at
Kalinganagar and Tumb Village (Taluka
Umbergaon , District Valsad ) as a port for
Registration for availing Export Promotion
Benefits.
DGFT Public Notice No. 39/ 2015-2020 dated 20
October, 2016
----------------------------------------------------------
Notification
Minimum Import Price (MIP) for import of iron and
steel is extended further for a period of two
months i.e. till 4 December, 2016.
Notification No. 30/ 2015-2020 dated 4 October,
2016
----------------------------------------------------------
CENTRAL EXCISE
Notifications
Non-Tariff
In Central Excise (Removal of Goods at
Concessional Rate of Duty for manufacture of
For Private Circulations Only 32 The Update –Oct, 2016, SGCO & Co.
Excisable and other Goods) Rules, 2016 in rule 4
sub rule(5), after the word “surety”, the words, “or
security” shall be inserted.
The effect of this is that the applicant
manufacturer, who is availing benefit of a
notification issued under sub-section (1) of section
5A of the Central Excise Act, 1944 granting
exemption of duty to excisable goods when used
for the purpose specified in that notification, shall
execute a general bond with surety or security.
Notification No. 46/2016 – CE (NT) dated 26-09-
2016
----------------------------------------------------------
In notification No. 30 / 2014-Central Excise (N.T.),
in the table, in column 4, the following entries
against serial number 1 to 7 shall be substituted –
“Audit, issue of Show Cause Notice and
Adjudication”.
The effect of this is that the officers of Central
Excise so appointed in Notification No. 30 / 2014-
Central Excise (N.T.) to be exercised for the
purposes of Audit and issue of Show Cause Notice
as well as Adjudication.
Notification No. 47/2016 – CE (NT) dated 28-09-
2016
----------------------------------------------------------
Amendment in Notification No. 27/2014-Central
Excise (NT), as follows:-
1. In Table II(A), - (a) for serial number 3 and the
entries relating thereto, the following serial
number and entries shall be substituted. namelv :-
(1) (2) (3)
3 Bhopal (i) Bhopal (ii) Indore (iii)
Raipur (iv) Ujjain (v) Bilaspur
(vi) Jabalpur.
2. in Table III(B), - (a) for serial number 40 and the
entries relating thereto, the following serial
number and entries shall be substituted, namely :-
(1) (2) (3)
40 Ujjain In the Districts of Dewas,
Jhabua, Ratlam, Mandsaur,
Shajapur, Ujjain, Guna,
Rajgarh (Excluding Tehsil
Narsingarh), Gwahor,
Shivpuri, Datia, Morena,
Sheopur, Neemuch, Bhind,
Ashoknagar, Agar and
Alirajpur of the State of
Madhya Pradesh.
3. In Table IV- (a) for serial number 4 and the
entries relating thereto, the following serial
number and entries shall be substituted. namelv :-
(1) (2) (3)
For Private Circulations Only 33 The Update –Oct, 2016, SGCO & Co.
4 (i) Audit-I (ii)
Audit-Il (iii)
Appeal-I (iv)
Appeal-Il, Bhopal
(i) Bhopal (ii)
Indore (iii) Raipur
(iv) Ujjain (v)
Bilaspur (vi)
Jabalpur
Notification No. 48/2016 – CE (NT) dated 07-10-
2016
----------------------------------------------------------
SERVICE TAX
Service by way of advancement of Yoga
provided by entities registered under
section 12AA of Income-tax Act, 1961 is
exempt from the levy of service tax -:
Advancement of Yoga Service has come into the
ambit of Service tax w.e.f. 1 July 2012. Since, Yoga
service was not considered under the definition
of Charitable Activities, the amendment has been
made in the Finance Act, 1994, so as to include
“Yoga ” service provided by entities registered
under section 12AA of Income by way of Charitable
Activities is exempt in Mega Exemption
Notification No.25/2012.
Notification No.25/2012-Service tax In exercise of
the powers conferred by sub-section (1) of section
93 of the Finance Act, 1994 (32 of 1994)
(hereinafter referred to as the said Act) and in
supersession of notification number 12/2012-
Service Tax, dated the 17th March, 2012,
published in the Gazette of India, Extraordinary,
Part II, Section 3, Sub-section (i) vide number
G.S.R. 210 (E), dated the 17th March, 2012, the
Central Government, being satisfied that it is
necessary in the public interest so to do, hereby
exempts the Services by an entity registered under
section 12AA of the Income tax Act, 1961 (43 of
1961) by way of charitable activities; (k)
"charitable activities" means activities relating to -
(i) public health by way of -
(a) care or counseling of (i) terminally ill persons
or persons with severe physical or mental
disability, (ii) persons afflicted with HIV or AIDS, or
(iii) persons addicted to a dependence-forming
substance such as narcotics drugs or alcohol; or
(b) Public awareness of preventive health, family
planning or prevention of HIV infection;
(ii) Advancement of religion or spirituality;
(iii) Advancement of educational programmes or
skill development relating to,-
(a) abandoned, orphaned or homeless children;
(b) Physically or mentally abused and
traumatized persons;
(c) Prisoners; or
(d) Persons over the age of 65 years residing in
a rural area;
(iv) Preservation of environment including
watershed, forests and wildlife; or
For Private Circulations Only 34 The Update –Oct, 2016, SGCO & Co.
(v) Advancement of any other object of general
public utility up to a value of,- (a) eighteen lakh
and seventy five thousand rupees for the year
2012-13 subject to the condition that total value
of such activities had not exceeded twenty five
lakhs rupees during 2011-12;
(b) twenty five lakh rupees in any other
financial year subject to the condition that total
value of such activities had not exceeded twenty
five lakhs rupees during the preceding financial
year;
Whereafter Notification No.20/2016- Service tax
In exercise of the powers conferred by sub-section
(1) of section 93 of the Finance Act, 1994 (32 of
1994), the Central Government, being satisfied
that it is necessary in the public interest so to do,
hereby makes the following further amendments
in the notification of the Government of India in
the Ministry of Finance (Department of Revenue)
No.25/2012 – Service Tax, dated the 20th
June,2012,published in the Gazette of India,
Extraordinary, Part II, Section 3,Sub-section (i) vide
number G.S.R.467 (E),dated the 20th
June,2012,namely-
(b) in clause (k),in sub-clause (ii), for the words
religion or spirituality, the words religion,
spirituality or yoga shall be substituted
After amendment in the definition of Charitable
Activities, it is always dispute that whether service
tax is to be paid on the service by way of
advancement of Yoga provided; by entities
registered under section 12AA of Income tax Act,
from the first day of July, 2012 and ending with the
20thday of October, 2015.
To conclude that no service tax is to be paid on
service provided by Charitable Institution by way
of advancement of yoga before the notification on
Mega Exemption-Notification No.20/2016 , the
Central Government in exercise of the powers
conferred by section 11C of the Central Excise
Act,1994 (1 of 1944), read with section 83 of the
Finance Act,1994 (32 of 1994), the Central
Government hereby directs that the service tax
payable under section 66B of the Finance
Act,1994, on the service by way of advancement of
yoga provided by entities registered under section
12AA of Income-tax Act,1961943 of 1961) in the
said period, but for the said practice, shall not be
required to be paid.
Notification No. 42/2016-Service Tax dated 26
September 2016
----------------------------------------------------------
The Central Government hereby makes the
following rules further to amend the Service
Tax Rules, 1994, via Notification No. 43
For Private Circulations Only 35 The Update –Oct, 2016, SGCO & Co.
/2016-Service Tax dated 28 September,in
the Service in Form ST- 3,-
Amendment in the Service Tax Rules, 1994, in
Form ST- 3;-
A new Cess named as Krishi Kalyan Cess is added
after Swacch bharat Cess in PART
A,B,C,D,E,F,G,H,I. of Form ST-3
Notification No. 43 /2016-Service Tax dated 28
September,in the Service in Form ST- 3
----------------------------------------------------------
Non levy of service tax on provision of the
service of transportation, by educational
institutions is exempt from retrospective
effect i.e. from 1st April, 2013
On 20th June, 2012.It was stated that Services
provided to or by an educational institution in
respect of education by way of,-
(a) Auxiliary educational services; is exempted
from the levy of service tax.
Later, on 11thJuly, 2014 Amendment has been
made in above and it got replaced with new
exemption .i.e. Services provided by an
educational institution to its students, faculty and
staff; is exempted from service tax.
But there is still a doubt that whether any service
tax is to be paid on the service of transportation of
educational service to student ,staff & faculty of
such institution for the period between the new
exemption and old exemption.i.e.1st April,2013 -
10th July,2014
To clarify this doubt ,the central government has
issued a notification which states that no service
tax is to be paid on the service of transportation of
educational service to student ,staff & faculty of
such institution for the period between 1st
April,2013 - 10th July,2014
It means service of transportation of educational
service to student, staff & faculty of such
institution is exempt from the levy of service tax;
retrospectively, ie.w.e.f-1ST April, 2013.
References of Notifications-
(i) Notification No.45/2016.dt-
30/9/2016- Non levy of service tax
on provision of the service of
transportation, by educational
institutions is exempt from
retrospective effect i.e. from 1st
April, 2013
(ii) Notification.No,25/2012- dt-
For Private Circulations Only 36 The Update –Oct, 2016, SGCO & Co.
20/6/2012-Mega Exemption
(iii) Notification.No,06/2014 -dt-
11/07/2014 Amendment in
Notification.No,25/2012 DT-
20/6/2012
----------------------------------------------------------
MVAT
Circulars
Extension of due date for filling of refund
application for the year 2014-15
The Maharashtra Sales Tax Department (MSTD)
vide this trade circular had extended the due date
for filing refund application for the year 2014-15 in
Form 501 from 30 September 2016 to 8 October
2016. The extension was provided as the dealers
were facing technical problems in the system of
MSTD. Also, the facility of uploading e-501 was not
available form 28 September 2016 to 30
September 2016. Accordingly, the due date for
submission of refund application for the said year
had been extended by 7 days.
The said circular can be viewed for easy reference
at:
mahavat.gov.in/Mahavat/MyFold/KNOWLEDGE%
20CENTER/TRADE%20CIRCULARS/DateWise/KNO
W_TRADEC_DW_MVAT/KNOW_TRADEC_DW_MV
AT_10_03_16_11_15_40AM.pdf
Trade Circular 30T of 2016 Dated 1 October 2016.
----------------------------------------------------------
Extension of time limit under Settlement Act, 2016
and clarification on certain issues
The MSTD vide this trade circular has extended the
time limit under the Settlement Act, 2016 from 30
September 2016 to 15 November 2016. Further,
the MSTD have come up with additional
clarifications on procedures to be followed so as to
give the credit of amount paid prior to assessment
order with further relaxation of condition to
submit Audit Report in Form 704 in case of
imposition of penalty u/s. 61(2) of the MVAT Act,
2002.
The said circular can be viewed for easy reference
at:
mahavat.gov.in/Mahavat/MyFold/KNOWLEDGE%
20CENTER/TRADE%20CIRCULARS/DateWise/KNO
W_TRADEC_DW_MVAT/KNOW_TRADEC_DW_MV
AT_10_03_16_11_16_56AM.pdf
Trade Circular 31T of 2016 Dated 1 October 2016.
----------------------------------------------------------
For Private Circulations Only 37 The Update –Oct, 2016, SGCO & Co.
M
MCA UPDATES
Relaxation of additional fees and
extension of last date of filing of Form AOC‐
4, A OC‐4 (XBRL), AOC‐4 CSF AND MGT‐7 under
the Companies Act, 2013
Due extended date of Income tax filing and
request received from various stake holders for
allowing waiver of additional fee. In view of the
above, Ministry of Corporate Affairs has decided
to relax the additional fee payable on e‐forms
which are due for filing by companies on 29th
October, 2016 as one time waiver of additional fee
and it is also clarified to stakeholders that if such
due e‐forms are filed after 29th October, 2016, no
such relaxation shall be allowed.
Dated 27th October, 2016.
‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Companies (Incorporation) Fourth
Amendment Rules, 2016
The Central Government has make amendments in
Companies (Incorporation) Fourth Amendment
Rules, 2016 providing conversion of public
company into private company or private Limited
by shares or guarantee or conversion of guarantee
company into a company limited by shares.
Dated 01st October, 2016
-----------------------------------------------------------------
company into public company and Conversion of
Unlimited Limited Company into Company
For Private Circulations Only 38 The Update –Oct, 2016, SGCO & Co.
For Private Circulations Only 39 The Update –Oct, 2016, SGCO & Co.
UPCOMING DUE DATES
October, 2016
November, 2016
INCOME TAX INCOME TAX
7th - TDS/TCS payment, Filing
15G/15H for September’ 2016
7th -
-
TDS/TCS payment for October 2016.
Filing 15G/15H for October 2016.
15th - TDS/TCS statement in Form 24Q, 26Q,
27EQ, 27Q for the quarter ending
September’16.
30th -
-
Income Tax/ Wealth tax return of AY 2016-
17 for all corporate assesses & other liable
to audit for Transfer Pricing.
Submission of Transfer Pricing Audit Report
MVAT/CST/PT MVAT/CST/PT
21st -
-
MVAT/CST payment for month /quarter and half year ending Sep’16. WCT TDS payment for the ending Sep’16
21st -
-
MVAT/CST payment for month of Oct’ 16 WCT TDS payment for month ending Oct’ 16
31st -
-
-
MVAT/CST monthly / quarterly / half yearly return for period ending sep’16 in case where the entire liability paid on or before the due date
Submission of CST declaration in Form F’ for the month ending Sep’16
31st -
-
-
-
MVAT/CST monthly return for period ending Oct’16 in case where the entire liability is paid on or before the due date
Submission of CST declaration in Form ‘F’ for month ending Oct’ 16
PT payment if salary of Oct’ 16 paid in Nov’ 16
For Private Circulations Only 40 The Update –Oct, 2016, SGCO & Co.
Sub Submission of CST declaration in Form ‘C’ and in Form H’ for the quarter ending Sep’16
PT payment if salary of Sep’16 paid in Oct’16
- PT return for the month of Nov’ 16 , if salary of Oct’ 16 paid in Nov’ 16
Service Tax
Service Tax
6th -
-
Service Tax payment (other than sole proprietor & Partnership Firms) for the proprietor & Partnership Firms) for the
Service Tax payment for sole proprietor & Partnership Firms for quarter ended Sep’ 16
6th - Service Tax monthly payment (other than sole proprietor & Partnership Firms) for Oct’ 16
25th - Service Tax returns for the period Apr16 to Sep16
Excise Excise
6th - Excise Payment for Sep’16
6th - Excise Payment for Sep’16
10h -
-
-
-
Excise Return for (ER-1) Sep’16 Excise Return for (ER-3) for SSI for quarter ending Sep’16
Excise return (ER-2) for Sep’16 (Applicable for EOU’s)
Excise return (ER-2) for Sep’16
10th -
-
-
-
Excise Return for (ER-1) Sep’16
Excise Return for (ER-3) for SSI for quarter ending Sep’16 Excise return (ER-2) for Sep’16 (Applicable for EOU’s) Excise Return (ER-6) for Sep’16
For Private Circulations Only 41 The Update –Oct, 2016, SGCO & Co.
15th - Quarterly Excise Return for dealers
15th - Quarterly Excise Return for dealers
Company Law
Company Law
7th -
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File NBS-6 return for exposure to capital markets
File a monthly return in prescribed format (NBFC-ND)
7th -
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Filing of e-form 8 for the F.Y. 31st March 2016 of LLP
File a monthly return in prescribed format (NBFC-ND)
15th -
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Quarterly Compliance Report on Corporate Governance U/C 49 of the Listing Agreement
Filing of E-Form ADT-1 (for appointment of Auditors) (Within 15 days of the AGM)
14th - Furnish unaudited Quarterly financial results in the prescribed format U/c 41 I (c) (i) of listing agreement ‐ for Listed Companies
21st - Quarterly Shareholding Pattern for Listed Companies U/C 35 of the Listing Agreement
30th - Filing of e-form MGT-7 for the F.Y. 31st March 2015
30th -
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Quarterly Reconciliation of Share Capital Audit Report for the quarter ended by Practicing CA / PCS ‐ for Listed Companies as per Regulation 55A of the (Depositories and Participants) Regulations, 1996 Half yearly submission of Compliance Certificate U/C 47 of the Listing Agreement Filing of e-form AOC-4 (Annual Accounts) of the Companies with ROC for the F.Y. 2015- 2016 (within 30 days of the AGM) Filing of e-form AOC-4 CFS
For Private Circulations Only 42 The Update –Oct, 2016, SGCO & Co.
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Consolidated Financial Statements, if applicable) of the Companies with ROC
Filing of e-form 8 for the F.Y. 31st March 2016 of LLP for the F.Y. 2015- 2016 (within 30 days of the AGM)
For Private Circulations Only 43 The Update –Oct, 2016, SGCO & Co.
4A, Kaledonia-HDIL, 2nd Floor, Sahar Road, Near Andheri Station, Andheri (East), Mumbai - 400 069. India
Tel.: +91 22 6625 6363 Fax: +91 22 6625 6364 E-Mail: [email protected] Web: www.sgco.co.in
M u m b a i
Disclaimer
This newsletter is prepared strictly for private circulation and personal use only. The newsletter is for general guidance on matters of interest only and does not constitute any professional advice from us. One should not act upon the information contained in this newsletter without obtaining specific professional advice. Further, no representation or warranty (expressed or implied) is given as to the accuracy or completeness of the information contained in this newsletter. This newsletter (and any extract from it) may not be copied, paraphrased, reproduced, or distributed in any manner or form, whether by photocopying, electronically, internet, within another document or otherwise, without the prior written consent of S G C O & Co