UPDATE - Bizsolindia

UPDATE

ISSUE - VI | VOLUME - XVI | February 2021

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We Believe In“A customer is the most important visitor on our premises. He is not dependent on us. We are dependent on him. He is not an interruption of our work. He is the purpose of it. He is not an

outsider of our business. He is part of it. We are not doing him a favour by serving him. He is doing us a favour by giving us the

opportunity to do so.”

Mahatma Gandhi

TABL

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T In This Issue

From the Desk of the Chairman 17Importance of RBI/FEMA Compliances For Corporates 19What’s New- GST 23- Customs 25- DGFT 29- RoDTEP 30- Income Tax 35- Companies Act 36- SEBI 38- MSME 39- RBI 39- SEZ 40Beyond the Obvious 41Bizsol Corner 42Our Services 45

Name CompanyR K Gupta (GM-Commercial) Cosmo Films LimitedPramod Agrawal (AVP - Finance & Accounts) Aurangabad Electricals LimitedArvind Chittora (Director) Conitex Sonoco India Pvt LtdGautam Sen Ajma & SonsNamdeo Kuyate GE India Industrial System Pvt. Ltd.Subhash Chaudhari CIPLA Ltd.Shekhar Gandhi Navjivan Precooling And Export Private Ltd.Darshan Rampariya Anuh Pharma Ltd.Avinash Kapoor (Director - Operations) HELVOET RUBBER & PLASTIC TECHNOLOGIES

INDIA PVT.LTDRajan Abraham DRILBITS INTERNATIONAL PVT. LTD.Amol Shah M J BiopharmMr. Balsubramanian (CFO) Sun Pharmaceutical Industries Ltd.Sukesh Baban Dhage Hitech Bio Sciences India Private LimitedSachin H.Patil (AM-Accounts) NLMK India Service Center Pvt. Ltd.Anil Waje Wohr Parking Systems Pvt. Ltd.Ashok Patil TDK India Private LimitedL.P.Sanadhya Ipca LaboratoriesSuneel Sonawane (GST Cell, Accts & Finance)

Precision Automation & Robotics India Ltd.

Ajay Jain (AGM) LG Electronics India Pvt. LtdDhwanee Buch (GM -Accounts) Garware Technical Fibres Ltd.Nivedita Assar Mohini Group

ISSUE - VI | VOLUME - XVI | FEBRUARY 2021 13

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ISSUE - VI | VOLUME - XVI | FEBRUARY 202114

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ISSUE - VI | VOLUME - XVI | FEBRUARY 2021 15

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THISMONTH FOR YOU!

Date February-215 State Excise Act Returns in Form RT-1 / RT-2 for January 216 Excise E-payment for January 20 (w.r.t products not covered under GST)7 1.TDS/TCS Payments for January 20

2.Payment of Salary / Wages if employee < 100010 1.Payment of Salary / Wages if employee > 1000

2. ER-1 / ER-2 Returns for October 20 (w.r.t. products not covered under GST)3. GSTR-8 (to be filed by e-commerce operators) required to deduct TCS under GST for the October 20.4. GSTR-7 by the person who is required to deduct TDS under GST for October 20.

10 GSTR-8 (to be filed by e-commerce operators) required to deduct TCS under GST for the January 2020

11 Monthly GSTR-1 for January, 2113 GSTR-6 Return to be filed by Input Service Distributor for January 20.15 Filing of AOC-4, AOC-4(CFS), AOC-4 XBRL and AOC-4 non XBRL

PF Payment Cum Return in Form ECR for December 20ESIC Payments for January 20Income Tax Returns (Audit case including partners) for FY 2019-20PF Payment Cum Return in Form ECR for January 21ESIC Payments for January 21Income Tax return for assessee under Audit.

18 Taxpayers who have opted for composition scheme CMP-0820 GSTR-5 & 5A (to be filed by the Non-Resident taxable person & OIDAR for Jan-21

GSTR-3B for January, 202122 GSTR3B Taxpayers with Turnover Less Than 5 Crore having Principal Place of Business

in Chhattisgarh, MP, Gujarat, Daman & Diu, Dadra & Nagar Haveli, Maharashtra, Karnataka, Goa, Lakshadweep, Kerala, Tamil Nadu, Puducherry, Andaman & Nicobar Islands, Telangana, Andhra Pradesh.

24 GSTR3B Taxpayers with Turnover Less Than 5 Crore having Principal Place of Business in J&K, Ladakh, HP, Punjab, Chandigarh, Uttarakhand, Haryana, Delhi, Rajasthan, UP, Bihar, Sikkim, Arunachal Pradesh, Nagaland.

28 Annual Return (GSTR 9 & 9C) for FY 2019-20

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From The Desk OfThe Chairman

Venkat R VenkitachalamChairman, Bizsolindia

Over a period of time the Government Budget has ceased to be a dreaded document accompanied by

certain uncertainties. With the indirect taxes having gone out of the scope the Budget, it has become more a statement of governance than a simple financial forecast. That is why the FM of the day holds forth with Part A of the Speech full of rhetoric and wishful thinking about the country in general and its economy in particular. The Budget like any other business presentation is about the messages it conveys. Nirmala Sitharaman has definitely grown in confidence ever since she had presented her first Budget. With an unprecedented pandemic to tackle, even a seasoned economist would have found it difficult to cope with an assignment that involves a responsibility to find finances to run the country when its economy is in shambles. If at all I have to fault her, it is the way she marketed this Budget even before presenting it in the Parliament. She promised to come out with a Budget like no other, contrary to the normal strategy adopted by a seasoned marketer of downplaying expectations. This posturing by the FM led to a kind of irrational exuberance about the Budget though it was not logically justified during a pandemic. The dilemma before the FM was the danger of her pushing for growth exacerbating an already existing inequality gap in the society. In the end, the FM decided to bite the silver bullet judging by the stock market reaction in spite of the heavy fiscal deficit. Inflation would now be lurking at every street corner on account of this extremely high fiscal deficit. But then, these are not normal times. The FM estimates to close the current year with a deficit of 9.50% with a projected deficit of 6.80% for the year 2021-22. The FM gives a roadmap to attain a deficit of 4.50% by 2025-26. With this, the much celebrated FRBM Act is likely to get an honourable, though undesirable burial. This FM is also fond of relying on the time tested but ever elusive revenues coming in through sheer buoyancy in the

If at all I have to fault her, it is the way she marketed this Budget

even before presenting it in the Parliament.”

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economy consequent to the FM’s own proposals in the Budget. Based on a rough and ready and a back-of-the-envelope calculations the FM appears to have factored in a growth of 1.60% on account of this.

Now let me come to some important messages emanating from the Budget. The biggest takeaways in this Budget are not what it had done; but what was not done. In the run up to the Budget with the cost of the pandemic having to be factored into the Budget, it would have been logical to assume additional revenue mop up in the form of additional taxes, reintroduction of Wealth Tax or even a levy of an Inheritance Tax. None of these dire predictions materialised leading to a huge, albeit unprecedented, relief rally in the stock market. There were some other important takeaways too. The most important message was that finally the government has decided to do the undoable. The Budget signals that the government is not averse to privatising the public sector banks despite the difficulties involved in marketing the proposal to the country. Among the pillars on which the FM had sought to build the Budget, the most important one was relating to the financial sector. The concept of a Bad Bank to handle the burgeoning NPAs on the Balance Sheets of the banks had been gaining currency of late. Though the process of recovery through bad banks may entail additional cost it may be worthwhile to take this route considering the bankers’ lack of time and bandwidth to handle the tortuous debt recovery processes. Despite having failed in its repeated promises on divestment of public sector undertakings the FM yet again has pursued this route in the Budget along with the reiteration of coming out with the much touted IPO of LIC. This time around the analysts are sure to hold the FM’s feet to the fire on this proposal.

What is a Budget without some politics to spice it up? The poll bound states of West Bengal and Tamil Nadu got its share of goodies when the FM announced infrastructure projects for these states. The FM announced a new agri-cess. That

was the only time that we were reminded of the fact that this Budget is being introduced during a pandemic if you ignore the introductory part of the Budget speech where the FM waxed eloquently about the government’s handling of the pandemic. She perhaps was entitled to do so. Yet another significant Budget provision was about the sharp increase of 34.50% in expenditure of a capital nature. Some of the money contributing to the deficit should yield desirable results if you go by these figures. That coupled with the focus on infrastructure and healthcare should augur well for the health of our economy. On the compliance front there were a few significant announcements, the most important of them being the proposal to consolidate some of the provisions relating to Securities into a single Securities Market Code.

When the stock market is cheering and the industry is celebrating with that lurking inflation is still some distance away, who is complaining (other than the Opposition, of course)? With debt no longer considered a cuss word, it appears perfectly legitimate to spend your way to prosperity. What other reasonable alternative that the FM had? I, for one, do not want to be in her shoes. I doff my hat to the FM for a difficult job done reasonably well. It is always easier to criticise than to create, especially in a pandemic environment. Ironically both Nirmala Sitharaman and P Chidambaram commended their respective Budgets to the very same House quoting from Thirukkural, a compendium of sacred verses reported to have been written by Thiruvalluvar, a Tamil poet and philosopher who lived in the 5th Century. That only goes to show that there are different pathways to prosperity.

As always, in the following pages of this Update you will find a clause by clause analysis of the Budget put together by Team Bizsol.

Thank youVenkat R Venkitachalam

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Adwait VenkitachalamDirector, Bizsolindia FinServ

It is usually noticed that corporates, especially those who set up shop in India from abroad and those in

the MSME sector do not seem to give sufficient importance to the critical requirement of having to comply with the statutory requirements when it comes to filings with the Reserve Bank of India (RBI) and compliances under Foreign Exchange Management Act (FEMA). This might be happening more out of sheer ignorance of consequences of non-compliances or out of their inability to assign the necessary priority to this critical requirement. Either way, the consequences of non-compliance could be extremely costly.

Quite so often, the secretarial aspects of handling a lengthy series of filings with the RBI when it comes to a company’s investments from abroad or those in a company abroad get overlooked. In most cases, this is due to inadequate knowledge about the formalities involved. The RBI on its part is largely supportive of corporates; but off late, they have started cracking down on errant entities.

In order to understand the nature and extent of the RBI compliance requirements, below is a ready reckoner covering various compliance formalities:

IMPORTANCE OF RBI/FEMA COMPLINCES FOR CORPORATES

“We are neither hawks nor doves. We are actually owls.”

-Raghuram Rajan (Ex-RBI Governor)

Type of Filing Form Timeline

Foreign Direct Investment (FDI)

Form FCGPR 30 day from issue of equityForm FCTRS 60 days from receipt of funds

Allotment of Shares within 180 days of receipt of funds

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Type of Filing Form Timeline

Overseas Direct Investment (ODI)

Form ODI Part I (Initial Investment - UIN) Pre-investment stage

Form ODI Part I (Subsequent Investments) within 30 days of investment

Form ODI Part II (APR) by 31st December every yearSubmission of FLA by 15th July every year

Form ODI Part III (Disinvest-ment) within 90 days of sale proceed

Issue of share certificates within 180 days from fund transfer

External Commer-cial Borrowings

(ECB)

Form ECB (LRN Allotment) Pre-loan stageForm ECB 2 (Changes in ECB

Terms) Within 7 days of changes

Form ECB 2 (Monthly report-ing) Based on month of actual transaction

Form FCGPR & Form ECB 2 (ECB to equity)

Timelines as per FCGPR & ECB 2 mentioned above

Delay in Import Payments past 12

months

Request Letter to AD Bank with CA certificate At the time of delayed payment

Delay in Export Receivables past 12

months

Either write-off or allowed as per terms outlined by RBI Prior to 12 months from date of export

Non-compliance of the above requirements would entail penalties that can be quite heavy. It may also happen that a company may commit a default despite its best efforts. In such an event it is important to know the remedial measures. The RBI allows compounding of certain contraventions with certain conditions.

Compounding of an offence is a process whereby the company committing default would be called upon to file an application to the Reserve Bank of India accepting that it had indeed committed an offence and would permit the defaulting party to deposit a fine/penalty as decided by the RBI on a case-to-case basis. Once the compounding penalty is paid, the company would no longer be treated as a party in default for those offences and the case would be closed permanently.

It is also important to know that each delay in

filing or delays in subsequent years of filings for the same investment are all considered as separate offences. For example, a company that has not filed APRs for the past three financial years would be found to have committed three separate offences.

As the RBI does not enjoy the powers to enforce any of its orders, all such cases of default on compounding orders are handed over to the Enforcement Directorate, which has the powers to prosecute and take the case of such parties to its logical conclusion.

The RBI does take cognizance of the fact that the compounding application is a form of self-declaration of a contravention by the company, but it reserves the right to charge the offending company a maximum penalty of 300 % of the amount involved, which amounts to large sums of money. In the past, companies who have

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flouted the RBI’s regulations towards statutory filings have even had to pay penalties in crores.Some of the most common errors we routinely find while conducting our RBI/FEMA Compliance audits are:

• A foreign MNC with a subsidiary or JV in India having failed to file Form FCGPR at the time of receipt of funds or fail to inform the RBI regarding changes in shareholding structure;

• An Indian entity failing to inform the RBI regarding equity/loans/corporate guarantees given to foreign subsidiary;

• Failure in informing the RBI regarding change in capital structure of Step Down Subsidiaries;

• One of the most common discrepancies we find are companies failing to file APRs & FLAs with the RBI each year for their investments made abroad.

To conclude, the RBI has in the past taken a lenient approach to irregularities in compliance by the corporates. But, with the growth in bilateral international business and trade, the RBI is now very stringent when it comes to compliances and we have seen a slew of cases where many contraventions occurring over the past decade have been brought out by the RBI in the past one year alone. As a matter of corporate hygiene, companies must now look at clearing up all their past compliances before the same is pointed out by the RBI, where the penalties

could be very harsh. A pro-active approach & an audit of your RBI/FEMA compliances could help reduce large losses in the future. Losses that could directly affect your bottom-line. What is more, these losses are entirely avoidable.

Thank You!Adwait Venkitachalam

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Goods and Services Tax• Due dates for furnishing annual return and reconciliation statements in form GSTR -9, GSTR

9A and GSTR 9C for FY 2019-20 are extended from 31st Dec 2020 to 28th Feb 2021. [Notification No. 95/2020 Dated 30th December 2020]

• Taxpayers will not be allowed to file GSTR 1 in following cases:a. FORM GSTR 3B not filed for preceding two months,b. In case of taxpayer who is filing quarterly returns then if he has not filed GSTR 3B for preceding quarter,c. In case of taxpayer who is restricted for using balance in ITC ledger up to 99% of tax liability then if he has not filed the GSTR 3B for preceding tax period. [Notification No. 01/2021, dated 1st January,2021]

• Jurisdiction of Principal officers has been changed as follows:Sr no Earlier Amended

1 Commissioner (Appeals II) Delhi and Additional Commissioner (Ap-peals II) Delhi.

Commissioner (Appeals I) Delhi and Additional Commissioner (Appeals II) Delhi.

2 Commissioner (Appeals I) Mumbai and Additional Commissioner (Ap-peals I) Mumbai.

Commissioner (Appeals II) Mum-bai and Additional Commissioner (Appeals I) Mumbai.

[Notification No. 02 /2021 – Central Tax, dated 12th January, 2021]

• Auto populated GSTR-1 will be available for taxpayers who are covered under E-invoicing Scheme. Salient features are given below:

a. Certain notified taxpayers have to prepare and issue e- invoices.b. Upon successful generation of IRN, details of such e-invoices will be auto-populated in respective tables of GSTR-1. The same can be downloaded as excel file as well.c. In case the GSTR-1 for corresponding period was already filed by the taxpayer, then, the details from e-invoices can be downloaded as excel file only.d. The details would be auto - populated based on document datee. Auto-population into GSTR-1 is as follows:

Sr no Type of Supply Auto-populated

in GSTR-1 Table

1 Taxable outward supplies made to registered persons (other than reverse charge) B2B - Table 4A

2 Taxable outward supplies made to registered persons attracting reverse charge B2B - Table 4B

3 Export supplies EXP- Table 6A4 Credit or debit notes issued to registered persons CDNR - Table 9B5 Credit or debit notes issued to unregistered persons CDNR - Table 9B

f. After auto-population of details from e-invoices, in case of cancellation of IRN, such documents will be reflected as deleted in the respective table.g. Before filing GSTR-1, taxpayers are advised to review the details of e-invoices auto-populated in specified tables.h. Taxpayers are advised to modify/update only those documents where the details auto-populated from e-invoices are not as per the actual invoice issued.

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i. Taxpayers are required to add details of supplies made in respective tables of GSTR-1, other than those auto-populated from e-invoices.j. An additional facility of consolidated download of all documents auto-populated from e-invoices is available in GSTR-1 dashboard. For this, one can use ‘Download details from e–invoice (Excel)’ button on GSTR-1 dashboardk. The excel file downloaded from GSTR-1 dashboard page will have details of all the e-invoices received from Invoice Registration Portal (IRP) including cancelled invoices.l. Following additional information relating to such e-invoices will also be available:i. Invoice Reference Number (IRN) – 64 string hashii. Date of Invoice Reference Number (IRN date)iii. e-invoice Status – Valid/ Cancellediv. Date of auto-population/ deletion (in case of cancelled IRN) will be the date when the e-invoice details are auto-populated in GSTR-1 or when the IRN was cancelled. Any subsequent modifications made to the auto-populated documents (in GSTR-1 tables) would not be reflected in this excel file.v. GSTR-1 auto-population / deletion status (either of the following): Auto - populated, Deleted, Auto-population failed, Deletion failed[Advisory on Advisory on auto-population of e-invoice details into GSTR-1, dated 12th January,2021]

• Whenever CBIC issues any circular, MGSTD ( Maharashtra Goods and Service Tax department), on its examination, would issue a separate circular regarding its applicability for the implementation of the MGST Act 2017. [Trade Circular No. 01T of 2021, dated 12th January,2021]

It is against the principles since CBIC issued the clarification only after recommendation of GST Council and no one is authorised to change. Therefore, trade and industry association has taken up the matter with PMO office.

GST Advance Ruling / Important Case Studies: • Advance ruling application rejected on

failure of applicant to frame question in the case of Jewel Classic Hotels Pvt. Ltd. by Advance Ruling Authority of Haryana.

• Hon. Gujarat High Court have Stopped mechanical & Casual bank account attachment and remarked that mechanical or casual exercise of such power will dilute the very efficacy of the provisions of Section 83 of the Act. Every day there are not less than ten matters on the subject of Section 83 of the Act in the cause-list. When there are plethora of judgments explaining Section 83 of the Act in details, then why so much of litigation in the High Court. The only reason that can be attributed is the mechanical exercise of power under Section 83 of the Act. This should stop at the earliest. So much judicial time is wasted in all such matters wherein the law is so well settled. [Vinodkumar Murlidhar Chechani Proprietor of M/S Chechani Trading Co. Vs State of Gujarat & 1 Other (Gujarat High Court)]

• No GST on reimbursements received from HO to Liaison office as held in the case “Wihelm Fricke Se” (GST AAR Haryana).

• GST is not payable on RCM basis the remuneration paid to the Director who is in the employment and file the income tax return under the head of “Income From Salaries”, in other cases GST is payable on RCM basis in terms of Appellate Advance Ruling Authority in the matter of CM/s lay Craft India Pvt Ltd.

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Customs

• Government has decided to extend the benefit of the Scheme for Remission of Duties and Taxes on Exported Products (RoDTEP) to all export goods with effect from 1st January 2021. The refund would be credited in an exporter’s ledger account with Customs and used to pay Basic Customs duty on imported goods. The credits can also be transferred to other importers. Rates would be notified shortly by the Department of Commerce, based on the recommendation of formed Committee and will be applicable from 1st January 2021 to all eligible exports of goods irrespective of date of notification.• Now, exporters will have to declare their

intention for exports under the RoDTEP, for each export item in the shipping bill or the bill of exports, in respect of exports being undertaken by them from 1st

January, 2021. “we intend to claim benefit under RODTEP scheme as applicable”

• The RoDTEP rates (as 3% was for MEIS) would be notified shortly by the Department of Commerce, based on the recommendation of the Committee.

• The notified rates, irrespective of the date of notification, shall apply with effect from 1st January, 2021 to all eligible exports of goods.

• The refund would be credited in an exporter’s ledger account with Customs and used to pay Basic Customs duty on imported goods. The credits can also be transferred to other importers.

• It will be independent and can be claimed alongwith Duty Drawback / Advance Authorisation. However, it is not clear whether EOU & SEZ Unit also will be benefited or not [Press release dated 31st December 2021]

• Customs duty on import of goods has been updated as follows: -Sr. No. HSN of goods Description Effective Duty rate

1 090940 to 090950 Caraway seeds, Juniper Berries etc 522 091020 Saffron 523 100810 Buckwheat 524 1518.00.39 Specified Other vegetable oil and its fats 445 1518.00.40 Specified Other vegetable oil and its fats 54

[Notification 45/2020-Customs dated 30th December 2020]

• Anti-dumping duty applicable on All fully drawn or fully oriented yarn/spin draw yarn/flat yarn of polyester (non-textured and non-POY) when imported from or having country of origin as China or Thailand has been rescinded. [Notification 48/2020-Customs (ADD) dated 30th December 2020]

• Courier Imports and Exports (Electronic Declaration and Processing) Regulations, 2010 shall apply to import of and export of vaccines in relation to COVID-19. Further exports have been allowed of bonafide gifts, commercial samples and prototypes of goods and re-export of durable container including accessories thereof, imported in relation to COVID -19 vaccines by amending Regulation 6 of said regulations and respective amendments have been made in Form H (COURIER SHIPPING BILL for goods). [Notification No. 115/2020-Customs (N.T.) dated 30th December 2020]

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1. The Ministry of Finance has issued the new regulation called Custom Authority for Advance Ruling regulations 2021 against Custom (Advance Rulings) Rules 2002 providing the detailed regulation as follows:

• The language of authority should be in Hindi or English, if it is in another language then Hindi or English translation thereof should be with original document.

• An application for obtaining an advance ruling shall be made in Form CAAR-1 before the jurisdictional Authority.

• Applications shall be received between 10:00 a.m. and 1:00 p.m. and between 2:00 p.m. and 5:00 p.m. on any working day at the respective office of the Authority.

• Every application, its verification, annexures, statements and supporting documents shall be signed in the manner mentioned in these regulations.

• The application shall be accompanied by evidence that the person who has signed the application, verification and other documents is authorised or competent to sign under these regulations.

• Every application and supporting

documents shall be on A-4 size paper and should be neatly and legibly written, typed or printed leaving a left margin of five centimetres and only on one side of a page in double-line spacing.

• An appeal against the advance ruling shall be made by the applicant in Form CAAR-2 and shall be accompanied by a fee of fifteen thousand rupees.

• An appeal against the advance ruling issued shall be made by the Principal Commissioner or Commissioner in Form CAAR-3 and no feel shall be payable by the said officer for filing the appeal. [Notification No. 1/2021 -Customs (N.T), dated 4th January,2021] [Notification No. 2/2021 -Customs (N.T), dated 4th January,2021]

2. Leavy of Anti- Dumping Duty on Melamine has been extended till 28th February, 2021, when such goods imported into India from China.[Notification No. 1/2021 -Customs (ADD), dated 6th January, 2021]

3. Following exchange Rate has been notified for specified currencies:Foreign Currency For Imports For Exports

US $ ₹ 74/$ ₹ 72.30/$EURO ₹ 91.80/EURO ₹ 88.60/EURO

[Notification No. 03/2021-CUSTOMS (N.T.), Dated 7th January 2021]

• Board has decided to extend the exemption from requirement of furnishing of Bank Guarantee by the carriers for carriage of EXIM cargo for transhipment through foreign territories of Sri Lanka and Bangladesh subject to specified conditions. [Circular No.01/2021-Customs]1. Tariff has been changed as given below:-

Sr. No. Chapter/ Heading Description

Tariff Value Old (US$/ metric

tonne)

Enhanced Tariff Value (US$/ metric

tonne)Table-1

1 1511 10 00 Crude Palm Oil 929 10492 1511 90 10 RBD Palm Oil 944 10613 1511 90 90 Others – Palm Oil 937 10554 1511 10 00 Crude Palm olein 950 1064

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5 1511 90 20 RBD Palm olein 953 10676 1511 90 90 Others – Palm olein 952 10667 1507 10 00 Crude Soya bean Oil 1054 11658 7404 00 22 Brass Scrap (all grades) 4413 47149 1207 91 00 Poppy seeds 3623 3623

Table-2

1 71 or 98

Gold for which benefit of entries at Sr. No. 356 of the

Notification No. 50/2017-Customs dated

30.06.2017 is availed

589 per 10 grams 593 per 10 grams

2 71 or 98

Silver for which benefit of entries at Sr. 357 and 359 of

the Notification No. 50/2017-Customs dated

30.06.2017 is availed

769 per kilogram 814 per kilogram

3 71

(i) Silver as specified. (ii) Medallions and silver

coins having silver content not below 99.9% as specified.

Explanation. - For the purposes of this entry, silver in any form shall not include

foreign currency coins, jewellery made of silver or

articles made of silver.

769 per kilogram 814 per kilogram

4 71

(i) Gold bars as specified. (ii) Gold coins having gold

content not below 99.5% and gold findings, other than

imports of such goods through post, courier or

baggage. Explanation. - For the

purposes of this entry, “gold findings” means a small com-ponent such as hook, clasp,

clamp, pin, catch, screw back used to hold the whole or a

part of a piece of Jewellery in place.

589 per 10 grams 593 per 10 grams

Table 31 080280 Areca nuts 3695 3695

[Notification No. 04/2021-CUSTOMS (N.T.), Dated 15th January 2021]

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2. Following exchange Rate has been notified for specified currencies:Foreign Currency For Imports For Exports

US $ ₹ 73.85/$ ₹ 72.10/$EURO ₹ 90.15/EURO ₹ 88.95/EURO

[Notification No. 05/2021-CUSTOMS (N.T.), Dated 21st January 2021]

3. CBIC has issued guidelines relating to the posting of officers and staff at Customs areas and collection of the Cost Recovery Charges. Guidelines issued on several other issues such as the applicability, Staffing Norms, Creation of posts on the basis of Cost Recovery Charges, Payment of Cost Recovery Charges, Eligibility for Exemption from Cost Recovery Charges, Withdrawal of exemption granted, Procedure for claiming/grant of exemption and De-notification and cost recovery charges etc.[Circular No. 02/2021-CUSTOMS, Dated 19th January 2021]

4. CBIC has directed its officers to strictly adhere to the aspect of limitation in filing appeals/ petitions before Courts/ Tribunal. Important petitions/appeals filed before Hon’ble High Courts, which would have all India ramifications and would require policy inputs from the Board should be immediately brought to the notice of policy section concerned of the Board.[CIRCULAR NO. 1077/01/2021 - CX [F.NO.275/65/2013-CX.8A (PT.), Dated 20th January 2021]

5. President has awarded the Appreciation Certificate and Medals for “Specially Distinguish Record of Service” to the officers and staff of Central Board of Indirect Taxes and Customs, Department of Revenue, for the Republic Day, 2020.[Notification No. 06/2021(NT), Dated 25th January 2021]

6. President has awarded the Appreciation Certificate and Medals for “Specially Meritorious Service at Risk to Life” and “Specially Distinguish Record of Service” to the officers and staff of Central Board of Indirect Taxes and Customs, Department of Revenue, on the occasion of the Republic Day,2021.[Notification No. 07/2021(NT), Dated 25th January 2021]

7. The name of producer has been changed from “Hanwha Solutions Corporation”, to “Hanwha Chemical Corporation” in case of imposing the Anti-Dumping Duty on following items:

Sr no. Item name Originating in or exported from1 Toluene Diisocyanate China PR, Japan and Korea RP2 Poly

Vinyl Chloride Paste ResinKorea RP, China PR, Malaysia, Taiwan, Thailand and European Union

[Notification No. 02/2021-Sustom (ADD), Dated 28th January 2021][Notification No. 03/2021-Sustom (ADD), Dated 28th January 2021]

8. Investigation concerning imports of “Soda Ash” has been Terminated originating in or exported from Turkey. [Notification F. No. 6/38/2019- DGTR, Dated 27th January 2021]

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DGFT• DGFT have amended Export Policy of Onion as follows:-

ITC(HS) Code Description Present Policy Revised Policy

0703101007122000

Onion (all varieties except Banga-lore Rose onions and Krishnapu-

ram onions) excluding cut, sliced or broken in powder form.

Prohibited Free

07031010 07122000

Bangalore Rose onions and Kr-ishnapuram onions excluding cut, sliced or broken in powder form.

Prohibited Free

[Notification No. 50/2015-2020 Dated 28th Dec, 2020]

• Export of specified non-Basmati and Basmati Rice has been permitted to EU Member States and European countries subject to certificate of inspection by Export Inspection Council/Agency. Such certificate shall be mandatory w.e.f. 1st July 2021 for export to other European countries. [Notification No. 51/2015-2020 dated 29th December 2020]

• Import of specified porcine intestinal mucosa (HS code 05040039) is ‘Free’ subject to obtaining Sanitary Import Permit from the Department of Animal Husbandry and Dairying under the Livestock Importation Act (Amendment), 2001. However, import of other items under this HS code will continue to remain ‘Restricted’ subject to import policy conditions. [Notification No. 52/2015-2020 dated 30th December 2020]

• DGFT has notified 18 agencies for issuance of Pre-Shipment Inspection Certificates along with the list of approved equipment with each of them. [Public Notice No. 35/2015-2020 dated 28th December 2020]

• DGFT has Extended the deadline to install and operationalize Radiation Portal monitors and container scanners in the designated sea-ports to 31st March 2021. [Public Notice No. 36/2015-2020 dated 29th December 2020]

1. DGFT has amended the export policy of Room fresheners/Car fresheners (that do not operate by burning) from restricted to Free. [Notification No. 54/2015-20, dated 1st January,2021]

2. Security protocols such as Sender Policy Framework (SPF), Domain Keys Identified Mail (DKIM), Domain Based Message Authentication, Reporting & Conformance (DMARC) have been issued to avoid the cybercrime in case of exporters. [Trade Notice No. 36/2020-21, dated 4th January,2021]

3. Head of the regional Authority can provide the documents asked by investigating agencies like CBI, ED, DRI etc by considering the facts and circumstances of the case. [ECA Circular No. 36/2015-20, dated 7th January,2021]

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4. DGFT has amended the export policy as follows: ITC (HS)

Code Description Existing Policy Revised Policy

41133000 Reptiles Prohibited Free43011000 mink, whole, with or without head, tail,

or pawsProhibited Free

43016000 fox, whole, with or without head, tail, or paws

Prohibited Free

43018000 fur skins, with or without head, tail, or paws

Prohibited Free

43021100 whole skins, with or without head, tail, or paws, not assembled

Prohibited Free

RoDTEPIndia has gone through in absolutely bad phase in the year 2020-21, not only on account of pandemics of COVID-19 but number of aspects w.r.t. business and tax compliances. At present, trade & industries and professionals are struggling to revive their business and liquidity is the only oxygen for them for survival of the business. Collection of GST has drastically reduced during the lockdown period and started picking up only from last month and government has also detected certain malpractices of issuing the fake invoices without supply of goods and services and therefore, honest taxpayer have been axed on account of the bureaucratical thinking, which has killed the basic concept of seamless of input tax credit, which can be evidence from the following action taken by the government.

1. Rule 36 (4) of CGST Rules 2017 was inserted vide Notification No. 49/2019 dtd. 9th October 2019 restricting the input credit to the extent of 120% of ITC reflected in GSTR-2A.

Quote(4) Input tax credit to be availed by a registered person in respect of invoices or debit notes, the details of which have not been uploaded by the suppliers under sub-section (1) of section 37, shall not exceed 20 per cent. of the eligible credit available in

respect of invoices or debit notes the details of which have been uploaded by the suppliers under sub-section (1) of section 37.

UnquoteFurther, the said notification was amended vide Notification No. 75/2019 – Central Tax dtd. 26th Dec 2019 restricting the ITC to the extent of 110% of ITC reflected in GSTR-2A. Such amendments are contrary to the provisions of Section 16 of CGST Act 2017, but even though it is covered under provisions of Section 41.

2. Rule 86A of CGST Rules 2017 was inserted vide Notification No. 75/2019 Central Tax dtd. 26th Dec 2019. This is contradictory with provisions of CGST Act 2017 and un-constitutional.

Quote“86A. Conditions of use of amount available in electronic credit ledger.(1) The Commissioner or an officer authorised by him in this behalf, not below the rank of an Assistant Commissioner, having reasons to believe that credit of input tax available in the electronic credit ledger has been fraudulently availed or is ineligible in as much as-

a) the credit of input tax has been availed on the strength of tax invoices or debit notes or any other document prescribed under rule 36- i.issued by a registered person who

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has been found non-existent or not to be conducting any business from any place for which registration has been obtained; or ii.without receipt of goods or services or both; or

b) the credit of input tax has been availed on the strength of tax invoices or debit notes or any other document prescribed under rule 36 in respect of any supply, the tax charged in respect of which has not been paid to the Government; or

c) the registered person availing the credit of input tax has been found non-existent or not to be conducting any business from any place for which registration has been obtained; or d) the registered person availing any credit of input tax is not in possession of a tax invoice or debit note or any other document prescribed under rule 36, may, for reasons to be recorded in writing, not allow debit of an amount equivalent to such credit in electronic credit ledger for discharge of any liability under section 49 or for claim of any refund of any unutilised amount.

(2) The Commissioner, or the officer authorised by him under sub-rule (1) may, upon being satisfied that conditions for disallowing debit of electronic credit ledger as above, no longer exist, allow such debit. (3) Such restriction shall cease to have effect after the expiry of a period of one year from the date of imposing such restriction.

QuoteThis rule is challenged in the Gujarat High Court in the case of Surat Mercantile Association Vs Union of India, on the following grounds and Gujarat High Court have issued the notice to the government. a. Conditions under Section 16 of CGST Act restrict the availment of credit, and warrant reversal in cases where credit has been wrongly availed.

b. The right to avail and utilize ITC for discharging tax liability is a legal right arising from the statute and it is trite in law that this right can be curtailed only with the specific power of the law and not otherwise’. [Eicher Motors Ltd. v. Union of India - 2002-TIOL-149-SC-CX-LB

c. None of the provisions contained in Section 16 including the Proviso 2 to the said Section or any other sections under the CGST Act empower the government to block ITC unilaterally, under any circumstances.

d. The Act provides for the provisional taking of credit on a self-assessment basis, and the blocking of credit goes against the scheme of the Act.

Thus, Rule 86A does not draw strength from any provisions of the CGST Act. The powers prescribed vide Rule 86A does not flow from the CGST Act, and hence can be challenged on the ground that it is ultra vires the Parent Act.

e. The decision of the Court in a similar case namely Kalpsutra Gujarat v. Union of India - 2020-TIOL-1558-HC-AHM-GST is awaited.

f. A similar issue was also before the Gujarat High Court in the cases of Valerius Industries v. Union of India - 2019-TIOL-2094-HC-AHM-GST whether the ITC can be blocked by the Revenue authorities.

g. The Court held that blocking of ITC without issuing a show cause notice and opportunity of hearing, was patently illegal and arbitrary and therefore asked the Department to accordingly unblock the ITC so blocked.

h. However, above cases were decided prior to the introduction of Rule 86A in the CGST rules.

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i. Under Rule 86A of the CGST Rules, the empowered officer is not required to give the assessee an opportunity of being heard before blocking of their credit ledger.

Therefore, the operation of Rule 86A in itself is tantamount to violation of principles of natural justice, insofar as it does not mandate that an opportunity be given to the assessee to be heard before the credit ledger is blocked and therefore, any action taken by the revenue arbitrarily under the said Rule is in violation of Principle of Natural Justice.

j. Recipient should not suffer on account of a supplier’s default.

3. Further amendment was made in Rule 36(4) vide Notification No. 94 /2020 – Central Tax dtd. 22nd Dec 2020 which has been made effective from 1st Jan 2020, whereby credit is restricted to the extent of 105% of ITC reflected in GSTR-2A and also GSTR-1 Return has been furnished by the suppliers. Within the span of 1 year, government has restricted the credit 3 times. However, it is pertinent to note that the restriction is applicable only on those invoices or debit notes which are to be uploaded by the supplier under section 37(1) of CGST Act i.e., in his GSTR-1 but which have not been uploaded by him. Therefore, one could avail full ITC of the GST paid on the following:• IGST paid on the import of goods;• IGST paid on the import of services under

RCM;• ITC distributed by ISD availed on the basis

of ISD invoice; and• ITC of the GST paid under RCM by the

recipient on the procurements which are taxable under RCM availed on the basis of RCM document i.e., self-invoice [for ex., legal services, GTA services, etc.].

However, there is no clarification issued by the department including its press release

clarifying the myths & facts, whether such restriction on overall amount of ITC or supplier wise. In our opinion, the restriction imposed is not supplier wise. Therefore, one would be required to consider the above restriction on a consolidated basis i.e., on the basis of total eligible ITC appearing in its GSTR-2A and total eligible ITC as per its books of accounts. It would not be required to do the comparison supplier wise or invoice wise.

4. Similarly, Rule 86B has been inserted vide Notification No. 94 /2020 – Central Tax dtd. 22nd Dec 2020, which stipulates that

Quote86B. Restrictions on use of amount available in electronic credit ledger.-Notwithstanding anything contained in these rules, the registered person shall not use the amount available in electronic credit ledger to discharge his liability towards output tax in excess of ninety-nine per cent. of such tax liability, in cases where the value of taxable supply other than exempt supply and zero-rated supply, in a month exceeds fifty lakh rupees:

Provided that the said restriction shall not apply where –

(a) the said person or the proprietor or karta or the managing director or any of its two partners, whole-time Directors, Members of Managing Committee of Associations or Board of Trustees, as the case may be, have paid more than one lakh rupees as income tax under the Income-tax Act, 1961(43 of 1961) in each of the last two financial years for which the time limit to file return of income under subsection (1) of section 139 of the said Act has expired; or

(b) the registered person has received a refund amount of more than one lakh rupees in the preceding financial year on account of unutilised input tax credit under clause (i)

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of first proviso of sub-section (3) of section 54; or

(c) the registered person has received a refund amount of more than one lakh rupees in the preceding financial year on account of unutilised input tax credit under clause (ii) of first proviso of sub-section (3) of section 54; or

(d) the registered person has discharged his liability towards output tax through the electronic cash ledger for an amount which is in excess of 1% of the total output tax liability, applied cumulatively, upto the said month in the current financial year; or

(e) the registered person is – (i) Government Department; or (ii) a Public Sector Undertaking; or (iii)a local authority;or (iv) a statutory body:

Provided further that the Commissioner or an officer authorised by him in this behalf may remove the said restriction after such verifications and such safeguards as he may deem fit.”.

UnquoteAdmittedly, less taxpayers will be affected but there is no guarantee for the government that this will not be extended to other taxpayers removing the exclusions. Such provisions provide the directions of thinking of government, which will cause hurdles.

5. Similarly, the provisions of suspension of registration and cancellation of registration has been amended, which is definitely add harassment to the taxpayer and raise the questions on faceless working of the government providing very high powers without providing natural justice, which will definitely hamper trade & industry adversely.

a. Now the officer can proceed for cancellation

of GSTIN where a taxpayer avails Input Tax Credit (ITC) exceeding than that permissible in Section 16. Clause (e) has been inserted in Rule 21 of CGST Rules 2017.

b. Now where the liability declared in GSTR 3B is less than that declared in GSTR 1 in a particular month, department may now proceed with cancellation of GSTIN. There might be some practical difficulties in implementing such a provision as there are number of corrections which are made in GSTR 3B which may result in lower tax liability as compared with GSTR 1. The clause (f) newly inserted talks about details of outward supply to which we understand that Taxable value and tax both should be in synchronization between GSTR 1 and GSTR 3B.

c. Now, no opportunity of being heard shall be given to a taxpayer for suspension of GSTIN, where the proper officer (PO) has reasons to believe that the registration of person is liable to be cancelled. The words “opportunity of being heard has been omitted from clause (2) of Rule 21A.

d. Where there are significant deviation/anomalies between details of outward supply between GSTR 3B and GSTR1 or inward supplies (ITC) between GSTR 3B and GSTR 2B which indicate contravention of Act, department shall now serve a notice in FORM GST REG 31 to call explanation as to why GSTIN should not be cancelled. Taxpayer shall be required to submit his reply within 30 days of such notice being served to him.

During the period of suspension and cancellation of registration taxpayer will adversely suffer not only in the business for making outward supplies but also for availing input tax credit, since one cannot stop the business on account of no fault of him. Such type of rules / prohibitions were not in existence even in the British Raj.

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Unfortunately, such type of amendments are made on the eve of birthday of Late Arun Jaitely, who has built up the concept of “One Nation- One Tax” for providing seamless credit and hassle-free business without interface of the officer, but his dream is shattered by the bureaucracy.

All such amendments are not only unconstitutional and contradictory to the basic provisions of the CGST Act but detrimental to the growth of trade and industry and will be the big hurdle for ease of doing business. Appeal to be made by each citizen to

Hon Prime Minister Shri Narendrabhai Modi and Finance Minister Smt Nirmala Sitharaman to withdraw such notifications.

1. DGFT has authorised M/S all India Plastics Manufacturers Association, Gurugram to issue certificate of Origin (Non Preferential). [Public Notice 37/2015-20, dated 8th January,2021]

2. United Kingdom (UK) is being added as a country of Export on the Electronic filing and Issuance of Preferential Certificate of Origin (e-COO) Platform under Generalised Scheme of Preferences (GSP).[Trade Notice No. 37/2020-21, dated 11th January,2021]

1. The quota for export of the following types of diagnostic kits has been fixed for the period from December,2020 to February, 2021 as follows:

Sr no Types of Diagnostic Kits Export Quota (Units/Nos)

1

VTM Kits or its component elements (15 ml Falcom Tube or Cryovials, Swabs sterile synthetic fibre swabs

(Nylon, polyster, Rayon or Dacron) exported as part of a kit or individually

660 Lakh

2

RNA Extraction Kits or its component elements (Sili-cone Columns, Poly AdenylicAcide or Carrier RNA,

Proteinase K, Magnatic Stands, Beads) exported as part of a kit or individually

400 Lakh

3

RT-PCR Kits (COVID/Non-COVID) or its compo-nent elements (Probe Specific for Covid-19, Primers

specific for Covid-19 Reverse Transcriptase Enzyme and Deoxy Nucleotide

Triphosphate) exported as part of a kit or individually

280 Lakh

• The application procedure and criteria for export of above Diagnostic kits is outlined below:a. Export of Diagnostic kits and their components/laboratory reagents as per above mentioned export quota is for the period till February, 2021.b. Exporters (Only Manufacturers) may apply online through DGFT’s ECOM system for Export authorizations (Non-SCOMET Restricted items)c. Exporters who have already filed an online application for export of these diagnostic kits need not apply again.d. Online applications for export of “Diagnostic Kits (VTM/RNA Extraction kits/RT-PCR Kits) or their components/laboratory reagents” for the above quantities may be applied from 21st to 31st January, 2021.e. Validity of the export license will be for 3 months only.f. All the documents must be duly self-attested by the authorized person of the firmg. Incomplete applications will not be considered for any allocation.[Trade Notice. 39/2020-21 of FTP, Dated 19th January 2021]

2. DGFT has introduced e-PRC system, according to this system all exporters or importers who are seeking relaxation of Foreign Trade policy or procedures are required to submit their

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application electronically only, from 25th January 2021.[Trade Notice. 38/2020-21 of FTP, Dated 15th January 2021]

1. The CIMS (Coal Monitoring System) will be effective from 1st April 2021 for the import of Coal. And the facility of online registration will be available from 15th February 2021.[Notification No. 56/2015-20-, Dated 28th

January 2021]

CBIC made the changes for implementing the Tariff Rate Quota (TRQ) licenses issued by DGFT and link with transmitted data by DGFT electronically to ICE gate w.r.t. IEC based quantity approved on TRQ licenses, which will be debited from the quantity imported against the bill of entry. It is the loudable and encouraging

Income Tax

Various due dates have been extended as follows: -

Sr. No. Applicable to Extended Due Date

1Furnishing of Income Tax Returns for the Assessment Year 2020·21 for the taxpayers (including their partners) who are

required to get their accounts audited and companies15th February 2021

2 Taxpayers who are required to furnish report in respect of international/specified domestic transactions 15th February 2021

3 Other taxpayers 10th January 2021

4Various audit reports under the Act including tax audit report

and report in respect of international/ specified domestic transaction

15th January 2021

5 Filing declaration under Vivad Se Vishwas Scheme 31st January 20216 Passing of orders under Vivad Se Vishwas Scheme 31st January 2021

7 passing of order or issuance of notice by the authorities under the Direct Taxes & Benami Acts 31st March 2021

8Due date for payment of self-assessment tax for

taxpayers whose self-assessment tax liability is up to Rs. 1 lakh for assesses in Sr. No. 1 and 2 above

15th February 2021

9Due date for payment of self-assessment tax for

taxpayers whose self-assessment tax liability is up to Rs. 1 lakh for assesses in Sr. No. 3

10th January 2021

[Press Release dated 30th December 2020]

1. The government has introduced the Faceless Penalty Scheme 2021 which will digitise issuing of penalties on assesses under the faceless taxation regime. Scheme specifies the setting up of national faceless penalty centres, regional penalty centres, penalty units and review units for execution of penalty proceedings, such that a penalty order is issued correctly and undergoes review before being issued to an assesses. All communication between units and assesses will be done either via email or through mobile app, while physical hearing will be allowed only with approval from CBDT.[Notification No. 02 /2021, dated 12th January, 2021][Notification No. 03 /2021, dated 12th January, 2021]

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2. CBDT has lunched the facility on e-portal for filing complaints regarding tax evasion/Benami Properties/Foreign Undisclosed Assets. The facility allows for filing of complaints by persons who are existing PAN/Aadhaar holders as well as for persons having no PAN /Aadhaar. After an OTP based validation process (mobile and/or email), the complainant can file complaints in respect of violations of the Income tax Act, 1961, Black Money (Undisclosed Foreign Assets and Income) Imposition of Tax Act, 1961 and Prevention of Benami Transactions Act (as amended) in three separate forms designed for the purpose.[Press Release, Dated 12th January,2021]

3. There are many representations received for extension of income tax return filing due dates, but government has already extended the due dates earlier by considering the COVID 19 situation. Hence all the representations for further extension of due dates have been rejected.Based on such order, Hon Gujarat High Court have only recommended to have the liberal view on penalties for late filing the returns and dismiss the petition filed for extending the due dates of income tax return after going through detailed statistics of filing the returns only on due dates. [Order under section 119 of Income Tax Act, 1961, Dated 11th January,2021]

3. The remuneration to be paid by Eligible Investment Fund to Eligible Fund Manager should not be less than as may be prescribed and in case of lower remuneration application for board approval should not be later than 1st February 2021. [Circular No. 01/2021 - CBDT, Dated 15th January 2021]

Companies Act MCA has further extended the due date for conducting board meeting through any means for approving financial statements from 31st December 2020 to 30th June 2021. Similarly, companies can conduct EGMs till 30th June 2021.[Notification dated 30th December 2020 and Circular 39/2020 dated 31st December 2020]

1. MCA has announced for Condonation of Delay Scheme for Companies restored by NCLT between 1 December 2020 to 31 December 2020. The Scheme provides to condone delay in filing forms with the Registrar, and spares payment of additional fees. Certain other terms are stipulated and are available in the Scheme document.

2. Objective:• To provide benefit of filing overdue forms

for restored companies by NCLT• To provide waiver of additional fees for

restored companies

3. Effective date and Duration of Scheme -This Scheme will be in operation from 01st February 2021 and will be available for filing of any overdue e-forms by such companies till 31st March 2021.

4. Forms which can be filed under scheme -All e forms other than SH-7 (For any increase in authorized share capital) and Charge forms (CHG-1, CHG-4, CHG-8 and CHG-9).

5. Fees applicable -Every company to which this Scheme is applicable shall be required to pay normal filing fees on the date of filing under Companies (Registration Offices and Fees) Rules, 2014 and no additional fees shall be required to be paid.[General Circular No. 03/2021 - MCA, Dated 15th January 2021]• No late fees shall be applicable for filing of

AOC-4, AOC-4(CFS), AOC-4 XBRL and AOC-4 non XBRL till 15.02.2021. all these forms are used to file the financial statements

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for each financial year with the Registrar of Companies (ROC). [General Circular No. 04/2021 dated 28th January 2021]

1. 56 LLP’s (Limited Liability Partnership) have made the application for striking of their names from the Registrar, accordingly the names of such LLP’s are displayed on MCA website. If any cause to contrary is shown within one month then the names of such LLP’s shall be stuck of from the Registrar and the same shall be dissolved.[Notice No. ROCB/LLP/Strike off/Sec.75-Rule 37(2)/JTA(M)/2021, Dated 27th January 2021]

2. The Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021 has amended as follows:• Registration of entities for undertaking CSR:• Every entity who intends to undertake

any CSR activity shall register itself with CG by filling the for CSR 1 electronically with registrar with effect from 1st April 2021 verified by digitally by practicing professional (CA/CS/CMA).

• Engagement of international organization for CST projects or programs:

• Company may engage international

organization for designing, monitoring or evaluation of the CSR projects or programs as per its CSR policy as well as for capacity building of their own personnel for CSR

• CFO shall Certify that the fund should be utilise for the purpose and in manner as approved by Board of Directors.

• The CSR committee shall formulate and recommend to the board an annual action plan in pursuance of its CSR policy.

• If company spends an amount in excess of requirement then such excess amount can be set off up to immediate succeeding 3 three financial years.

• CSR impact Assessment: Every company having average CSR obligation of Rs. 10cr or more in the immediate three preceding FY shall undertake impact assessment through an Independent Agency.

• BOD shall disclose the CSR projects including composition CSR committee and CSR policy.

• Format for Annual report on CSR activities to be included in the board’s report.

• Changes shall be effective from 22nd January 2021. [Notification No. G.S.R. 40(E). Dated 22nd January 2021]

3.Following provisions as proposed in Companies (Amendment) Act, 2020 shall be applicable from 22nd January 2021.

S No.

Section of the Companies (Amendment) Act, 2020

Section of the Companies Act, 2013 Particulars

1 2 Clause 52 of section 2 Definition of listed compa-ny

2 11 62(1)(a)(i) Further Issue of Share Capital

3 Clause c of section 18 89Declaration in respect of beneficial interest in any

share4 21 105(5) Proxies

5 Clause ii of section 22 117(3)(g) Resolutions and agree-ments to be filed

6 25 Insertion of new section 129A Periodical financial results

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7 27 135 Corporate Social Respon-sibility

8 53 379 Application of act to foreign companies

9 55 Insertion of new section 393A

Exemptions under this chapter

10 58 410 Constitution of Appellate Tribunal

11 59 Insertion of new section 418A

Benches of Appellate Tribunal

12 60 435(1) Establishment of Special Courts

13 62 446BLesser penalties for one

person companies or small companies

14 64 452(2) Punishment for wrongful withholding of property

15 65 454(3) Adjudication of Penalties[Notification No. S.O. 325(E). Dated 22nd January 2021]

1. For conversion of public company into private company if regional director receives any objection against the same then he may reject such application for conversion. But If regional director is satisfied that the conversion would not be against the interests of the company or is not being made with a view to contravene or to avoid complying with the provisions of the Act then regional director will accept the application for conversion.[Notification No. G.S.R 44E. Dated 25th January 2021]

Securities and Exchange Board of India• SEBI had previously specified requirements with regard to creation of security in issuance of

listed debt securities and due diligence to be carried out by debenture trustee(s), which were applicable from January 01, 2021. Now the same will be applicable from 1st April 2021. [SEBI/HO/MIRSD/CRADT/CIR/P/2020/254 dated 31st December 2020]

• Due to Covid-19 pandemic and representation received from the Stock Exchanges, it has been decided to extend the timelines for compliance with the following regulatory requirements by the trading members / clearing members, as under:

Sr. No.

Compliance requirements for which timelines are extended Extended timeline / Period of exclusion

1 Maintaining call recordings of orders/ instructions received from clients. February 28, 2021.

2

KYC application form and supporting documents of the clients to be uploaded

on system of KRA(KYC Registration Agency) within 10 working days.

Period of exclusion shall be from January 01, 2021 till February 28, 2021.

A 15-day time period after February 28, 2021, is allowed to clear the back log.

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[SEBI/HO/MIRSD/CRADT/CIR/P/2020/255 dated 31st December 2020]

• SEBI has advised to all stock exchanges regarding the refund of security deposit on surrender of membership by Trading Members as follows:

Sr no Case Date of release(Whichever is earlier)

1Trading Member is

engaged in trading on behalf of clients

(a) Three years from the date of receipt of surrender application by Exchange from the Trading Member or (b) Five years from the date of disablement of Trading

Member’s trading terminals by the Exchange.

2

Trading Member engaged only in proprietary

trading in last three years prior to the date of appli-

cation

(a) one year from the date of receipt of surrender application by exchange from the Trading Member, or (b) three years from the date of disablement of Trading

Member’s trading terminals by the Exchange

1. The Stock Exchanges are advised to bring the provisions of extension of EGM, AGM and sending the physical copies of annual report to shareholders etc. which are applicable to companies, to the notice of all listed entities and also disseminate on their websites. [SEBI/HO/CFD/CMD2/CIR/P/2021/11, Dated 15th January 2021]

2. To protect the interests of investors in securities and to promote the development of, and to regulate the securities market, SEBI has extended the relaxation from strict enforcement of certain Regulations of SEBI pertaining to Rights Issue opening upto 31st March 2021. [SEBI/HO/CFD/DIL1/CIR/P/2021/13, Dated 19th January 2021]

MSME• In order to books exports and fasten customs clearance procedures, Central Board of Indirect

Taxes & Customs has introduced the “Liberalised MSME AEO Package” for Micro Small and Medium Enterprises (MSMEs) subject to some conditions as the MSME should have valid certificate from their line-Ministry and filed minimum 10 Customs clearance documents in one year and have a clean compliance record over 2 years. Following benefits have been provided to MSME under “Liberalised MSME AEO Package” scheme:1. Direct Port Delivery (DPD) of imported containers,2. Direct Port Entry (DPE) of their Export,3. high level of facilitation in customs clearance of their consignments thereby ensuring

shorter cargo release time,4. exemption from Bank guarantees,5. priority for refund/ rebate/ duty Drawback,6. payment of Customs duty is deferred and need not to be paid before the clearance of the

imported goods by Customs etc

RBI1. RBI has introduced the LEI (Legal Entity Identifier) for large value transaction i.e. above 50 Cr

by non-individuals entities using RTGS and NEFT payment mode. [Notification No- RBI/2020-21/82, DPSS.CO.OD No.901/06.24.001/2020-21, Dated 5th January,2021]

2. RBI has issued the guidelines for Risk Based Audit to Banks as part of their internal control framework as follows:

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1. The internal audit function must have sufficient authority, stature, independence and resources within the bank

2. Requisite professional competence, knowledge and experience of each internal auditor is essential for the effectiveness of the bank’s internal audit function.

3. Tenor for appointment of Head of Internal Audit preferably for a minimum of three years

4. The internal audit function shall not be outsourced, Wherever required can appoint expert or former employees. Etc. [Notification No- RBI/2020-21/83, Ref.No.DoS.CO.PPG./SEC.04/11.01.005/2020-21, Dated 7th January, 2021]

1. RBI has withdrawn the circular which was related to Recovery of excess pension made to pensioners. As per this circular if any bank has paid any excess amount to the account of pensioner in that case bank can recover the same from pensioner. [RBI/2015-16/340, Dated 15th January 2021]

RBI releases Discussion Paper on Revised Regulatory Framework for NBFCs- A Scale-Based Approach.Banks may use ratings of ‘CRISIL’ for risk weighting their claims for capital adequacy purposes.[RBI/2020-21/86 DOR. No. CRE.BC.33/21.06.007/2020-21 dated 27th January 2021]

SEZ1. RoDTEP is also applicable to SEZ units if following conditions are satisfied:

i. The unit shall mention on shipping bill as “Shipping bill filed under RoDTEP scheme if applicable to SEZ units & subject to such conditions as prescribed including the product coverage ”ii. The goods shall be examined by customs.

[K-43022/35/2019-SEZ, Dated 15th January 2021]

-------------------------------------------------------While conveying our “albedo” to 2020, which can be remembered for many good things including the bad things “COVID-19”. It is always said that all the opportunities welcome only when problems exists. It is also said, every problem brings out the better solution and that is the reason there may be a proverb “Blessings in Disguise”. Year 2020 taught us :1. Nature is Supreme and you need to preserve

it. 2. One should have Work-Life-Balance 3. We learned interaction in person is more

important than communication on social media/app.

4. Family is utmost important than money. 5. Saving Based Economy is better than

Consumption Based Economy. Savings only be useful in crisis.

6. Fight with all odds and not only survive but ride on the crisis and be the winner.

Trade & Industry in certain sectors had definitely received the set-back, but we really express our gratitude for all your efforts for not only reducing the impact of COVID-19, but sustained and had growth in your business. We feel proud to be associated with you for ensuring 100% statutory compliances and improving our services, which are definitely much contributory to you. Since, each one have learned above from 2020, 2021 New Year have to be better and it will bring more opportunities, more wisdom and better health to each one of us and prosperity to the business.

We wish each of you & your family members, a Very Happy New Year!! Welcome 2021 !!

____________TEAM BIZSOL

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• Un-utilised Education Cess, Second-ary and Higher Education Cess and Krishi Kalyan Cess cannot be carried forwarded into the GST regime. Suth-erland Global Services Pvt Ltd vs Assis-tant Commissioner CGST (HC-Madras)

• Rejection of refund through a non-speak-ing order is liable to be set aside. Jay Jay Mills (India) Pvt Ltd vs State Tax Officer, Tirupur (HC-Madras)

• Activities undertaken by a co-oper-ative housing society as per its bye laws constitute supply. Apsara Co-op-erative Housing Society Limited.

• Refund is available only on inputs goods related unutilized ITC accumulated on ac-count of being subjected to inverted duty structure. Tvl. Trasntonnelstroy Afcons Joint Ventures vs Union of India (HC-Madras)

• High Court not to be approached in Goods detention cases if effective alter-nate remedies available in matters of GST Podaran Foods India Private Limit-

ed Vs State Of Kerala (HC-Kerela)

• Rule 86A cannot be invoked to block the ITC available in the electronic cred-it ledger for the purpose of recovering erstwhile VAT dues. Steel Kraft Indus-tries Vs State of Gujarat (HC- Gujarat)

• Service of the show cause notice at wrong e-mail address is not deemed to be a proper service under the GST Act, 2017 Ratan Indus-tries Limited Vs. State of U.P (HC- Allahabad)

• SCN for rejection of a refund should mention the specific reasons for the proposed rejection. Sahibabad Print-ers Vs Additional Commissioner, Cen-tral Tax (Appeal) (HC- Allahabad)

• CESTAT held that the insurance service provided by the Deposit Insurance Cor-poration to the banks is an “input service” and CENVAT credit of service tax paid for this service received by the banks from the Deposit Insurance Corporation can be availed by the banks for rendering ‘output services.’ Indusland Bank Ltd Vs CST

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E-Hearing by Nidhi Nawal Biyani

Our Founder, CMA Ashok Nawal in virtual meeting of “An overview of Special Audit u/s66 of CGST Act 2017”

Bizsol Foundation Celebration

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https://www.youtube.com/watch?v=IHN3JcIW-xw

New Episodes

#DigitalBizsol

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https://www.youtube.com/watch?v=IHN3JcIW-xw


Tap To Listen Now On!

New Episodes#DigitalBizsol

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OUR SERVICESBizsolindia Services Private Limited Consultancy & Audit in the Area of

• Strategic Management Consultancy• Indirect Taxation (GST, Customs)• AEO Certification• FEMA• Foreign Trade Policy (Export Promotional

Schemes, EPCG, Advance Authorization, DFIA, Duty Drawback, Brand Rate Fixation)

• EOU / EHTP / STP /BTP• SEZ• Project Consultancy (Industrial Parks, Clusters,

Agro Economic Zone, Food Park, etc.)• Direct Taxation including Domestic and Interna-

tional Transfer Pricing• New Business Set up in India• Valuation including Business Valuation• Internal Audit• Corporate Law & Procedures

BSPL Outsourcing Pvt. Ltd. Knowledge Process Outsourcing in the area of• Indirect Taxation• GST E-Way Bill• Accounts• Inventory management• Fixed Assets Management• Implementation of Company Law Matters

Bizsol Legal Services Handling Litigations/Compliances in-• Corporate Law/Company Law• Consumer Laws• Intellectual Property Law• Competition Law• Environmental Laws• NCLT & NCLAT• DRT and SARFAESI ACT• Labour Laws• Drafting Commercial Agreements

Bizsolindia IT Services Private Limited Specialized IT consulting and Solutions / modules along with ERP Integration and following areas:

• Specialized Software for EOUs and SEZs• Expert in Application programming using Java

and ERP Connectivity • Data Migration• Offers bucket of Add On Products for EXIM re-

lated solutions for the Complete industry needs• ERP Consulting / Implementation

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Bizsolindia Financial Services Pvt. Ltd. Financial Services dealing with:• Treasury Audit• Information Services• Advisory Services• Policy Consulting• Treasury Outsourcing• Interest Rates Advisory• Treasury Operations Training• Banking Advisory Services• International Syndication

A.B. Nawal & Associates, Practicing Cost Accountant, Cost Audit, GSTCost Accountants Adjudication matters up to CESTAT & VAT Audit.

MPAS & Associates Practicing Chartered Accountants, Statutory(Formerly Behede Joshi & Associates), & Tax Audit VAT Audit & Transfer Pricing Chartered Accountant R. Venkitachalam, Practicing Company Secretary.Company Secretary

Nawal Barde Devdhe & Associates, Practicing Cost Accountants & Cost AuditCost Accountants

Bizsolindia Services Pvt. Ltd.CIN: U74999PN2004PTC01925614-17, Suyash Commercial Mall, AboveUnion Bank of India, Baner Road,Baner, Pune-411045Tel: +91 020 40702001 /[email protected]

We welcome your valuable feedback on this issue at [email protected]

Core TeamR. VenkitachalamAshok NawalManoj BehedePravin AroteManoj Malpani

Chief EditorPreeti KulkarniEditorial TeamVinay Jain, Kiran Sawale, Amit Devdhe, Abhishek Malpani, Anita Patil, Swaraj Chhallani, Sourabh Lahoti, Shravan Biyani, Nidhi Nawal (Biyani)

Nasik: +91 9860791794, Mumbai: +91 99700 61039Aurangabad: +91 9422927642, Kolkata: +91 9477553389

Satara: +91 9423866197

For Private Circulation only. While utmost care has been taken to provide up to date & current information, any person using this information may exercise sufficient caution. We shall not be responsible for any errors / omissions or any losses arising out of use of contents of this newsletter. Reproduction of contents in any form needs prior written approval from Bizsol.

This disclaimer informs readers that the views, thoughts, and opinions expressed in the text belong solely to the author, and not necessarily to the author’s employer, organization, committee or other group or individual.

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UPDATE - Bizsolindia

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