TMI Tax Updates - e-Newsletter
July 6, 2019
Case Laws in this Newsletter:
GST
Income Tax
Customs
Insolvency & Bankruptcy
Service Tax
Central Excise
CST, VAT & Sales Tax
Indian Laws
TMI SMS
TMI Short Notes
Bill:
Summary: The Finance Bill 2019 outlines the rates for income-tax deduction at source from salaries and the computation of advance tax for the financial year 2019-20. These rates apply to all categories of assessees and are detailed in Part III of the First Schedule. They also govern the charging of income-tax on current incomes in special cases requiring accelerated assessments, such as provisional assessments for non-resident shipping profits, individuals leaving India permanently, those transferring property to avoid tax, and temporary entities. The document further highlights the key features of these specified rates.
Bill:
Summary: The Finance Bill 2019 outlines income tax rates for individuals, Hindu undivided families, associations of persons, bodies of individuals, and artificial juridical persons. For individuals under 60, the tax rates are 5% for income between Rs. 2,50,001 and Rs. 5,00,000, 20% for Rs. 5,00,001 to Rs. 10,00,000, and 30% above Rs. 10,00,000. For residents aged 60-79, the nil rate applies up to Rs. 3,00,000, and for those 80 and above, up to Rs. 5,00,000. Surcharges apply progressively from 10% to 37% based on income exceeding Rs. 50 lakh, with limits on the total tax and surcharge payable.
Bill:
Summary: The Finance Bill 2019 maintains the income tax rates for co-operative societies as outlined in the previous financial year, 2018-19. A surcharge of 12% is applied to co-operative societies with a total income exceeding one crore rupees. However, the combined income tax and surcharge for incomes over one crore rupees will not surpass the tax amount payable on exactly one crore rupees by more than the income amount exceeding one crore.
Bill:
Summary: The Finance Bill 2019-20 maintains the income tax rate for firms as specified in the previous financial year, 2018-19. For firms with a total income exceeding one crore rupees, a surcharge of twelve percent on the income tax is applicable. However, the combined amount of income tax and surcharge for income exceeding one crore rupees is capped. This ensures that the total tax liability does not exceed the tax on one crore rupees by more than the income exceeding that threshold.
Bill:
Summary: The Finance Bill 2019-20 specifies that the income tax rate for local authorities remains unchanged from the previous financial year 2018-19. A surcharge of 12% applies to local authorities with a total income exceeding one crore rupees. However, the total tax and surcharge payable on income exceeding one crore rupees is capped, ensuring it does not surpass the tax on a one crore rupees income by more than the excess income amount.
Bill:
Summary: The Finance Bill 2019 specifies tax rates for companies. Domestic companies with a turnover not exceeding 400 crore rupees in 2017-18 are taxed at 25%, while others are taxed at 30%. Non-domestic companies follow the 2018-19 rates. A surcharge of 7% applies to domestic companies with income over one crore rupees, increasing to 12% if income exceeds ten crore rupees. Non-domestic companies face a 2% surcharge for income over one crore rupees, rising to 5% for income over ten crore rupees. An additional 4% Health and Education Cess is levied on all taxes, with no marginal relief provided.
Bill:
Summary: The Finance Bill 2019-20 proposes the introduction of Section 194M to address tax evasion by individuals and Hindu Undivided Families (HUFs) who make payments to contractors and professionals without deducting tax at source (TDS). Currently, there is no TDS obligation on such payments for personal use or when the business is not audited. The new provision mandates a 5% TDS on payments exceeding fifty lakh rupees annually for contractual or professional services. To ease compliance, individuals and HUFs can deposit the deducted tax using their PAN without needing a Tax Deduction Account Number (TAN). This amendment is effective from September 1, 2019.
Bill:
Summary: Section 194-IA of the Act mandates a 1% TDS on the consideration paid for the transfer of certain immovable properties, excluding agricultural land. Previously undefined, "consideration for immovable property" will now include payments for amenities like club membership, car parking, electricity, water, maintenance, and advance fees. These payments, often required by the buyer under the purchase agreement, will be considered part of the property transfer cost. This amendment, effective from September 1, 2019, clarifies that such charges are integral to the property transaction.
Bill:
Summary: Section 9 of the Income Tax Act addresses income deemed to accrue in India, affecting non-residents. Previously, gifts from Indian residents to non-residents were often considered non-taxable in India. To close this loophole, the Finance Bill 2019 proposes that gifts of money or property from Indian residents to non-residents, made on or after July 5, 2019, will be deemed to accrue in India and thus taxable. Existing exemptions under section 56 will still apply, and applicable Double Taxation Avoidance Agreements (DTAAs) will govern in treaty situations. This amendment is effective from April 1, 2020, for the 2020-21 assessment year onward.
Bill:
Summary: The Finance Bill, 2019 proposes amendments to section 139 of the Income Tax Act, mandating certain individuals to file income tax returns regardless of their income level. These include individuals who deposit over one crore rupees in bank accounts, spend over two lakh rupees on foreign travel, or incur electricity expenses exceeding one lakh rupees. Additionally, individuals claiming rollover benefits for capital gains tax exemptions on investments must file returns if their income before claiming benefits exceeds the non-taxable threshold. These changes will be effective from April 1, 2020, for the assessment year 2020-2021 onwards.
Bill:
Summary: The Finance Bill 2019 proposes amendments to section 139A of the Income Tax Act to allow the interchangeability of PAN and Aadhaar numbers. Individuals entering high-value transactions without a PAN must apply for one, but may use their Aadhaar number instead. The amendments require quoting either PAN or Aadhaar in specified transactions and ensure proper authentication. A new sub-section mandates that documents related to these transactions must include the quoted PAN or Aadhaar number. Penalties for non-compliance are also revised. These changes aim to expand the tax base and will be effective from September 1, 2019.
Bill:
Summary: The Finance Bill 2019-20 proposes an amendment to Section 139AA, stating that if an individual fails to link their Aadhaar number with their PAN by the notified date, their PAN will become inoperative. This change aims to protect the validity of transactions conducted using such PANs before they become invalid. The amendment is set to take effect from September 1, 2019.
Bill:
Summary: The Finance Bill 2019 proposes to expand the scope of the Statement of Financial Transactions (SFT) under section 285BA of the Income Tax Act. This expansion mandates additional prescribed persons to furnish SFTs, removing the existing threshold of fifty thousand rupees for transaction reporting. The aim is to facilitate the pre-filling of income tax returns by including smaller transactions. Amendments also include stricter compliance measures, where failure to rectify defects in statements will be treated as furnishing inaccurate information. Penalty provisions under section 271FAA are also expanded to cover all reporting entities. These changes are effective from September 1, 2019.
Bill:
Summary: The Finance Bill 2019-20 includes measures to promote a less cash economy by mandating electronic payments. Key provisions prohibit cash transactions and require payments through account payee cheques, drafts, or electronic clearing systems. For instance, political donations over two thousand rupees must be made electronically to qualify for tax exemptions. Expenditures exceeding ten thousand rupees must also be electronic to be deductible. Amendments will introduce additional electronic payment modes from April 2020 for the 2020-2021 assessment year. Sections 269SS, 269ST, and 269T will similarly mandate electronic transactions for amounts exceeding specific thresholds, effective September 2019.
Bill:
Summary: A new section 194N is proposed in the Finance Bill 2019 to levy a 2% Tax Deducted at Source (TDS) on cash withdrawals exceeding one crore rupees in a year from accounts maintained by banking companies, cooperative banks, or post offices. This measure aims to reduce cash transactions and promote a less cash-dependent economy. Exemptions apply to transactions involving the government, banking entities, and certain businesses handling large cash volumes. The Central Government may grant additional exemptions in consultation with the Reserve Bank of India. This amendment is effective from September 1, 2019.
Bill:
Summary: The Finance Bill 2019-20 introduces a mandate requiring businesses with sales exceeding fifty crore rupees to accept payments through specified electronic modes, aiming to promote a digital economy and curb black money. Section 269SU of the Act will enforce this requirement, effective from November 1, 2019. Non-compliance will incur a daily penalty of five thousand rupees unless justified by valid reasons, as determined by the Joint Commissioner. Additionally, amendments to the Payment and Settlement Systems Act, 2007, will prohibit banks or system providers from imposing charges for using these prescribed electronic payment methods.
Bill:
Summary: The 2019-20 Budget and Finance Bill propose additional tax incentives to enhance the International Financial Services Centre (IFSC) in India. Key amendments include tax-neutral transfers of certain securities by non-resident Category III Alternative Investment Funds, exemption of interest income for non-residents from IFSC units, and tax-free dividends from accumulated income for IFSC companies. Further, mutual funds with non-resident unit holders in IFSCs are exempt from additional income tax on distributed income. The profit-linked deduction for IFSC units is extended to 100% for ten consecutive years. These changes aim to align IFSCs with global standards, effective from April 2020.
Bill:
Summary: The Finance Bill 2019 proposes amendments to section 43D of the Act to include deposit-taking and systemically important non-deposit-taking Non-Banking Finance Companies (NBFCs) within its scope. This change aims to offer a level playing field for these NBFCs by allowing them to defer tax on interest income from bad or doubtful debts until it is credited or received. Additionally, section 43B will be amended to permit deductions for interest paid on loans or advances from these NBFCs if paid by the return filing due date. These amendments are effective from April 1, 2020, applicable for the assessment year 2020-21 onward.
Bill:
Summary: Section 9A of the Act provides a safe harbor for offshore funds, ensuring that fund management activities by an eligible fund manager in India do not establish a business connection or residency for the fund in India. The Finance Bill 2019 proposes amendments to relax certain conditions, aiming to boost fund management activities in India. Key changes include setting a minimum fund corpus of 100 crore rupees within six months of establishment and ensuring the remuneration to fund managers meets prescribed standards. These amendments apply retrospectively from April 1, 2019, impacting the assessment year 2019-20 onward.
Bill:
Summary: The Finance Bill 2019 proposes a new section 80EEB to offer tax deductions for interest on loans up to 1.5 lakh rupees for purchasing electric vehicles. Eligible loans must be sanctioned by financial institutions, including non-banking financial companies, between April 1, 2019, and March 31, 2023. The deduction is available only if the borrower does not own another electric vehicle at the loan's sanction date. This benefit is exclusive, meaning it cannot be claimed under any other tax provisions. The amendment is effective from April 1, 2020, applicable to the assessment year 2020-2021 and onwards.
Bill:
Summary: The Finance Bill 2019 proposes an amendment to section 10 of the Act to exempt interest income earned by non-residents from Rupee Denominated Bonds issued by Indian companies or business trusts outside India between September 17, 2018, and March 31, 2019. This exemption, initially announced in a press release, aims to encourage low-cost foreign borrowings. Under the existing section 194LC, such interest income was subject to a concessional TDS rate of five percent. The amendment, effective from April 1, 2019, applies to the assessment year 2019-20 and onward, formalizing the tax exemption.
Bill:
Summary: The Finance Bill 2019 introduces a new section, 80EEA, to provide a tax deduction of up to INR 1.5 lakh on interest for loans taken for residential property, aiming to support the government's "Housing for All" initiative. Conditions include loan sanctioning between April 1, 2019, and March 31, 2020, a property stamp duty value not exceeding INR 45 lakh, and the borrower not owning any other residential property at loan sanction. Additionally, section 80-IBA is amended to align affordable housing definitions with the GST Act, affecting projects approved from September 1, 2019. These changes apply from April 1, 2020, for the 2020-21 assessment year onward.
Bill:
Summary: The Finance Bill 2019 proposes amendments to incentivize National Pension System (NPS) subscribers. It increases the tax exemption on NPS withdrawals from 40% to 60% of the total amount upon account closure or opting out. The bill also raises the deduction limit for Central Government contributions to employees' NPS accounts from 10% to 14% of the salary. Additionally, contributions by Central Government employees to their Tier-II NPS accounts will qualify for tax deductions under section 80C. These changes are effective from April 1, 2020, applicable to the assessment year 2020-21 and onwards.
Bill:
Summary: The Finance Bill 2019-20 proposes amendments to incentivize start-ups. Section 79 of the Income Tax Act will be revised to allow eligible start-ups to carry forward and set off losses against income if they meet either of the conditions in clauses (a) or (b). For other companies, only clause (a) applies. Section 54GB will be amended to extend the deadline for investment in eligible start-ups from residential property sales to March 31, 2021, reduce the minimum shareholding requirement to 25%, and shorten the asset transfer restriction period from five to three years, effective April 1, 2020.
Bill:
Summary: The Finance Bill 2019 proposes an amendment to the Income-tax Act's section 56, which currently taxes companies on share considerations exceeding fair market value, unless exempted. Previously, exemptions applied to venture capital undertakings receiving funds from venture capital companies, funds, or specified persons, benefiting only Category I Alternative Investment Funds (AIF). The amendment aims to extend this tax exemption to funds received from Category II AIFs, facilitating venture capital undertakings in securing investments. This change is set to take effect from April 1, 2020, applicable for the assessment year 2020-21 and onwards.
Bill:
Summary: The Finance Bill, 2019 proposes amendments to facilitate the resolution of distressed companies. Under the revised section 79, companies undergoing shareholding changes due to a resolution plan approved under the Insolvency and Bankruptcy Code, 2016, can carry forward and set off losses despite changes in voting power or shareholding. This benefit extends to companies where the National Company Law Tribunal has suspended the Board of Directors and appointed new ones. Additionally, for these companies, section 115JB allows the reduction of unabsorbed depreciation and loss in calculating book profit. These changes are effective from April 1, 2020, for the assessment year 2020-21 onward.
Bill:
Summary: The Finance Bill 2019 proposes amendments to sections 56(2)(x) and 50CA of the Income-tax Act, which deal with the fair market value of shares for tax purposes. Currently, section 56(2)(x) exempts certain transactions from its provisions, but section 50CA does not. This can cause hardship when share transfer prices are determined by authorities beyond the seller's control. The amendments aim to empower the Board to exempt specific transactions from these sections, providing relief for certain transactions. These changes will be effective from April 1, 2020, applicable to the assessment year 2020-21 onwards.
Bill:
Summary: The Finance Bill 2019-20 proposes amendments to improve tax administration by enabling the online filing of applications for determining tax to be deducted at source on payments to non-residents under section 195 of the Act. Currently, the process is manual, requiring individuals to apply to the Assessing Officer for a certificate for lower or nil withholding tax. The amendments aim to streamline this process through technology, reducing processing time and enhancing monitoring by tax authorities. Similar changes are proposed for sub-section (7) of section 195, effective from November 1, 2019.
Bill:
Summary: The Finance (No. 2) Bill, 2019 proposes amendments to Section 206A of the Act to facilitate electronic filing of statements for transactions where tax has not been deducted at source on interest payments to residents. The amendment allows online submission of such statements in a prescribed format and manner, with provisions for correcting errors or updating information. Additionally, a consequential amendment aligns with the Finance Act, 2019, which raised the threshold for tax deduction at source on interest payments by certain financial entities to forty thousand rupees. These changes are effective from September 1, 2019.
Bill:
Summary: The Finance (No. 2) Bill, 2019, aims to strengthen anti-abuse measures by extending the tax provisions under Section 115QA of the Income Tax Act to include listed companies. Previously applicable only to unlisted companies, this section imposes a 20% additional income tax on distributed income from share buy-backs. The amendment addresses tax avoidance practices where companies opt for share buy-backs over dividends to benefit from lower capital gains tax rates. Effective from July 5, 2019, the amendment also extends tax exemptions to shareholders of listed companies for buy-backs where the company has paid the additional tax.
Bill:
Summary: Section 12AA of the Income-tax Act outlines the process for granting and canceling registration of trusts or institutions to avail income tax exemptions. The section allows cancellation if the Principal Commissioner or Commissioner finds the entity's activities non-genuine or not aligned with its objectives, or if its income ceases to be exempt. Proposed amendments require the authorities to ensure compliance with relevant laws when granting registration. If a trust or institution violates such laws, and the violation is undisputed or final, the registration may be canceled after a hearing. These changes take effect from September 1, 2019.
Bill:
Summary: The Finance Bill 2019 proposes an amendment to facilitate the demerger of companies compliant with Indian Accounting Standards (Ind-AS). Currently, for a tax-neutral demerger, the resulting company must record the property and liabilities at the book value of the demerged company. Ind-AS compliant companies, however, must record these at a different value. The amendment to section 2 of the Act will allow such companies to record property and liabilities at values compliant with Ind-AS, rather than book values, effective from April 1, 2020, applicable from the assessment year 2020-21 onwards.
Bill:
Summary: The Finance Bill 2019 proposes amendments to sections 201 and 40 of the Act to address tax deduction issues for payments to non-residents. Currently, section 201 exempts deductors from being deemed in default if they fail to deduct tax on payments to residents, provided certain conditions are met. This relief is not available for non-resident payments. The amendment extends this relief to non-resident payments, effective from September 1, 2019. Additionally, section 40 is amended to prevent disallowance of expenses if tax is not deducted for non-resident payments, effective from April 1, 2020, applicable to the assessment year 2020-21 onwards.
Bill:
Summary: The Finance Bill 2019-20 proposes an amendment to Section 92CD of the Income Tax Act to clarify the powers of the Assessing Officer regarding modified returns filed following an Advance Pricing Agreement (APA). Section 92CC allows the Central Board of Direct Taxes to enter into APAs to determine the Arm's Length Price for international transactions. The amendment specifies that if an assessment or reassessment is completed before a modified return is filed, the Assessing Officer should only modify the total income based on the APA, rather than starting a fresh assessment. This change is effective from September 1, 2019.
Bill:
Summary: The Finance Bill 2019-20 proposes amendments to section 92CE of the Act to improve the secondary adjustment regime in transfer pricing. It clarifies that the conditions regarding the threshold of one crore rupees and primary adjustments up to the assessment year 2016-17 are alternate. The amendments mandate calculating interest on excess money and allow repatriation from non-resident associated enterprises. If repatriation is delayed, an additional 18% tax with a 12% surcharge is applicable. This tax is final, with no credit or deduction allowed. These changes apply retrospectively from April 1, 2018, and prospectively from September 1, 2019.
Bill:
Summary: The Finance Bill of 2019 proposes an amendment to section 111A to extend a concessional short-term capital gains tax rate to certain equity-oriented fund of funds. This amendment aims to further incentivize these funds, which were initially set up for the disinvestment of Central Public Sector Enterprises (CPSEs). Previously, a concessional rate for long-term capital gains was provided under section 112A. The proposed amendment will be effective from April 1, 2020, and will apply to the assessment year 2020-21 and subsequent years.
Bill:
Summary: The Finance Bill 2019 proposes amendments to Section 115UB to address issues faced by Category I and II Alternative Investment Funds (AIFs) regarding the pass-through of losses. Currently, only income, excluding business income, passes through to investors for tax benefits. The amendments allow business losses to be carried forward by the AIF and not passed to unit holders. Non-business losses will be ignored for pass-through if the unit is held for less than twelve months. Losses as of March 31, 2019, will be attributed to unit holders for carry forward, not the AIF. These changes apply from April 1, 2020, for the 2020-21 assessment year onward.
Bill:
Summary: The Finance (No. 2) Bill, 2019 proposes amendments to sections 140A, 143, 234A, 234B, and 234C of the Income-tax Act to address the omission of relief under section 89, which provides tax relief for salary paid in arrears or advance. The absence of this relief in the computation of tax liability has caused difficulties for eligible taxpayers. The proposed amendments aim to rectify this by including section 89 relief in tax calculations, effective retrospectively from April 1, 2007, applicable from the assessment year 2007-08 onward.
Bill:
Summary: Under section 194DA of the Act, tax is deducted at source on life insurance payouts that are not exempt under section 10(10D). Previously, the tax was deducted at 1% of the gross amount. Concerns arose about this approach since it did not account for the insurance premiums paid by the policyholder, leading to tax on net income discrepancies. To address this, the Finance Bill 2019 proposes a 5% tax deduction on the net income component, effective from September 1, 2019. This change aims to align TDS returns with the actual income reported by the taxpayer.
Bill:
Summary: Section 286 of the Act mandates that parent entities or alternate reporting entities (ARE) in India must submit a Country-by-Country Report for their international group within twelve months of the reporting accounting year's end. Concerns arose regarding AREs in India whose ultimate parent entities are abroad, questioning whether the accounting year should align with the foreign parent entity's year instead of India's. To clarify, an amendment will specify that the accounting year for such AREs should match the parent entity's year. This amendment, effective retrospectively from April 1, 2017, addresses the issue for the assessment year 2017-18 onward.
Bill:
Summary: The Finance Bill 2019 proposes amendments to Section 92D, which governs the maintenance and furnishing of information and documents by entities involved in international or specified domestic transactions. It mandates that constituent entities of an international group maintain prescribed information, even if no international transaction occurs. Rule 10DA outlines the required information based on group revenue and transactions. The amendment, effective April 1, 2020, requires these entities to furnish information to the prescribed authority, applicable from the assessment year 2020-21 onwards.
Bill:
Summary: Section 56(2)(viib) of the Act addresses the taxation of share issuance by certain companies when the consideration exceeds the fair market value. The Central Government can exempt companies from this provision through notifications, provided specific conditions are met. If a company fails to comply with these conditions, the excess consideration over the face value of the shares will be treated as taxable income for the year of non-compliance. These amendments are effective from April 1, 2020, applicable to the assessment year 2020-21 onwards.
Bill:
Summary: The Finance Bill 2019 proposes an amendment to section 56 of the Income-tax Act to correct the reference from section 145A(b) to section 145B(1). This change addresses the oversight following the Finance Act 2018, which replaced section 145A with sections 145A and 145B. The amendment will be applied retrospectively from April 1, 2017, affecting the assessment year 2017-18 and onwards.
Bill:
Summary: The Finance (No. 2) Bill, 2019 proposes amendments to Section 270A, which addresses penalties for under-reporting and misreporting income. The current provisions lack a mechanism for determining under-reported income and the penalty amount when a return is filed for the first time under Section 148. The proposed changes aim to establish a method for calculating penalties in such cases. These amendments will apply retrospectively from April 1, 2017, affecting the assessment year 2017-2018 and onward.
Bill:
Summary: The provisions of section 276CC of the Finance Bill 2019 propose changes to address prosecution for failure to file income tax returns. Previously, prosecution was not pursued if the tax payable, excluding companies, was under three thousand rupees. The amendment clarifies that pre-paid taxes, including self-assessment tax and tax collected at source, should be considered when determining tax liability. Additionally, the threshold for tax payable is increased from three thousand to ten thousand rupees. These changes will be effective from April 1, 2020, applicable to the assessment year 2020-21 and onwards.
Bill:
Summary: The Finance (No. 2) Bill, 2019 proposes amendments to section 228A of the Income-tax Act to enhance tax recovery measures in alignment with international agreements. Currently, the Act allows the Central Government to recover taxes from individuals with property in India based on foreign government requests. The proposed amendments will extend this recovery capability to cases where property details are unavailable, provided the individual is a resident in India or the defaulter is a resident abroad. These changes aim to fulfill treaty obligations and will be effective from September 1, 2019.
Bill:
Summary: The Finance Bill 2019 proposes amendments to simplify refund claims and extend time limitations for the sale of attached property. Section 239 will be amended to require refund claims to be made by filing a return per section 139, effective from September 1, 2019. Additionally, rule 68B's limitation on selling attached immovable property for tax recovery will be extended from three to seven years, with a possible further extension of three years by the Board to prevent revenue loss. These changes aim to streamline procedures and protect revenue interests.
Bill:
Summary: The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, is being amended to clarify the definition of "assessee" to include residents and certain non-residents of India concerning undisclosed foreign income and assets. The amendments specify the conditions under which individuals are considered assessees based on their residency status in previous years. Additionally, changes to section 10 introduce terms "re-assess" and "reassessment," effective retrospectively from July 1, 2015. Amendments to section 84 apply provisions of section 144A of the Income-tax Act to the BM Act, and changes to section 17 allow the Commissioner (Appeals) to adjust penalty orders, effective from September 1, 2019.
Bill:
Summary: The Finance Bill, 2019 proposes amendments to the Income Declaration Scheme, 2016, specifically sections 187 and 191 of the Finance Act, 2016. The amendments aim to address concerns of declarants by allowing the Central Government to notify certain individuals who can pay taxes, surcharges, and penalties after the due date, with an interest of one percent per month. Additionally, it allows for refunds of excess payments made under the Scheme. These changes are effective retrospectively from June 1, 2016, providing flexibility and relief to taxpayers who declared undisclosed income.
Bill:
Summary: The Finance (No. 2) Bill, 2019 proposes an amendment to section 99 of the Finance (No.2) Act, 2004, concerning the valuation of taxable securities transactions (STT) for options in securities when exercised. Previously, the taxable value was based on the settlement price. The amendment changes this to the difference between the strike price and the settlement price. This adjustment aims to rationalize the STT levy and will be effective from September 1, 2019.
Bill:
Summary: The Prohibition of Benami Property Transactions Act is being amended to clarify and streamline various provisions. The amendments include allowing Initiating Officers to proceed without prior approval from the Approving Authority after issuing a notice, effective retrospectively from November 1, 2016. The period for property attachment and order issuance will be calculated from the end of the month of notice issuance, effective September 1, 2019. Additional amendments provide for the exclusion of court-stayed periods, impose a penalty for non-compliance with summons, allow certified documents as evidence, and require competent authority sanction for prosecutions, all effective September 1, 2019.
Bill:
Summary: The Special Undertaking of the Unit Trust of India (SUUTI), established under the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002, is tasked with liquidating government liabilities from the former UTI. Previously exempt from income tax and other taxes on its income, profits, or gains until March 31, 2019, the Finance Bill 2019-20 proposes extending this tax exemption for an additional two years, until March 31, 2021. This amendment is set to be applied retrospectively from April 1, 2019.
Bill:
Summary: The Finance (No. 2) Bill, 2019 introduces amendments related to customs duties, including Basic Customs Duty, Export Duty, and Road and Infrastructure Cess. These changes are outlined under various clauses of the Bill and will become effective upon its enactment unless specified otherwise. The Basic Customs Duty is levied under the Customs Act, 1962, while the Export Duty applies to goods listed in the Second Schedule of the Customs Tariff Act, 1975. The Road and Infrastructure Cess is an additional duty imposed under the Finance Act, 2018.
Bill:
Summary: The Finance (No.2) Bill, 2019 introduces several amendments to the Customs Act, 1962. Key changes include the amendment of Section 41 to allow departure manifests to be submitted to designated persons, and the introduction of Chapter XIIB for identity verification using Aadhaar or other means. Section 103 now permits scanning individuals for concealed goods with magistrate reporting. Section 104 empowers customs officers to arrest for offenses outside India and introduces cognizable and non-bailable offenses. Amendments to Sections 110 and 110A address the provisional attachment and release of bank accounts. Penalties under Sections 117, 125, and 135 are increased, with new regulations for document amendments under Sections 149 and 157.
Bill:
Summary: The Finance (No. 2) Bill, 2019 introduces amendments to the Customs Tariff Act, 1975. Section 9 is revised to include sub-section (1A), which implements anti-circumvention measures for countervailing duties. Additionally, Section 9C is modified to specify that appeals concerning determinations or reviews related to the imposition of safeguard duties, due to increased import volumes, will be addressed by the Customs Excise and Service Tax Appellate Tribunal.
Bill:
Summary: The Finance (No. 2) Bill, 2019 introduces amendments to the First Schedule of the Customs Tariff Act, 1975, effective from July 6, 2019. Key changes include increased basic customs duty rates on various commodities: construction materials like plastic floor coverings and ceramic tiles rise from 10% to 15%; precious metals such as silver, gold, and platinum increase from 10% to 12.5%; automobile parts like friction materials and locks for vehicles see rates rise from 10% to 15%. Electronics, including air conditioners and CCTV cameras, also face higher duties. Additionally, printed books imported for personal use are excluded from certain tariff headings.
Bill:
Summary: The Finance (No. 2) Bill, 2019, proposes changes in basic customs duty rates and clarifications on respective notifications. Key changes include exemption of customs duty on specified defense equipment and parts, raw materials for artificial kidney manufacturing, and nuclear power generation materials. Increased duties are applied to cashew kernels, palm stearin, certain plastics, and rubber products. Adjustments include reduced duties on wool fibers and tops, and increased rates for marble slabs, precious metals, and certain electronic items. The bill also clarifies that prawn and shrimp larvae feed, except in pellet form, will attract a 5% duty.
Bill:
Summary: The Finance (No. 2) Bill, 2019, outlines proposed changes to export duty rates as part of the 2019-20 budget. The export duty on EI tanned leather is proposed to be reduced from 15% to nil. Additionally, the duty on hides, skins, and leathers, both tanned and untanned, is proposed to decrease from 60% to 40%. These adjustments aim to impact the leather export industry by reducing the financial burden on exporters, potentially enhancing competitiveness in the global market.
Bill:
Summary: The Finance (No. 2) Bill, 2019, amends the Sixth Schedule to the Finance Act, 2018, specifically concerning the Road and Infrastructure Cess levied as an additional duty of customs on petrol and diesel. Effective from July 6, 2019, the rate of duty for motor spirit, commonly known as petrol, and high-speed diesel oil is increased from Rs. 8 per litre to Rs. 10 per litre. This amendment is immediately enforceable due to a declaration under the Provisional Collection of Taxes Act, 1931.
Bill:
Summary: The Finance (No. 2) Bill, 2019, introduced a change in the Road and Infrastructure Cess on petrol and diesel as part of the 2019-20 budget. The effective rate of this cess, which is levied as an additional duty of customs, increased from Rs. 8 per litre to Rs. 9 per litre for both motor spirit, commonly known as petrol, and high-speed diesel oil.
Bill:
Summary: The Finance (No. 2) Bill, 2019 proposes retrospective amendments to several customs notifications. These amendments aim to correct classification codes and provide exemptions. Notably, notifications from 2011 and 2017 regarding Stearic Acid are to be amended to reflect accurate classification starting from specific past dates. Additionally, a 2018 notification is set to be retrospectively applied to exempt IGST and compensation cess on temporary vehicle imports from July 2017 to December 2018. Amendments also include correcting classifications for certain yarns and excluding ter polymer from anti-dumping duties on Polypropylene for specified past periods.
Bill:
Summary: The Finance (No. 2) Bill, 2019 introduces several changes to customs regulations. It clarifies that prawn and shrimp larvae feed are eligible for a 5% concessional rate, while fish feed in pellet form also attracts 5%. The bill includes HS 8486 in a notification to exempt machines used in semiconductor manufacturing from basic customs duty. It updates the description in a 2005 notification to include headphones and related items under tariff subheading 8518 30 00. Additionally, it amends a 2017 notification to exclude certain audio components like microphones and connectors from specific entries.
Bill:
Summary: The Finance (No. 2) Bill, 2019 introduces amendments related to excise duties, which include adjustments to the Basic Excise Duty as outlined in the Central Excise Act, 1944. It also addresses the Road and Infrastructure Cess, an additional duty from the Finance Act, 2018, and the Special Additional Excise Duty from the Finance Act, 2002. The amendments specified in the Bill take effect upon its enactment unless stated otherwise, impacting how these duties are levied and administered.
Bill:
Summary: The Finance (No. 2) Bill, 2019 introduces amendments to the Fourth Schedule of the Central Excise Act, 1944, specifically affecting the rate of Basic Excise Duty. Effective from July 6, 2019, the duty on petroleum crude, classified under tariff item 2709 20 00, is adjusted from nil to Re. 1 per tonne. This change is implemented immediately under the Provisional Collection of Taxes Act, 1931.
Bill:
Summary: The Finance (No. 2) Bill, 2019, proposes changes in excise duty rates for various tobacco products and crude petroleum oil. Excise duties are introduced on different types of cigarettes, including both filter and non-filter varieties, at a rate of Rs. 5 per thousand units, and on other tobacco products like hookah tobacco, smoking mixtures, and chewing tobacco at varying rates from 0.5% to 1%. The duty on crude petroleum oil produced in specified fields is reduced from Re. 1 per tonne to nil. These changes aim to adjust the tax structure on tobacco and petroleum products.
Bill:
Summary: The Finance (No. 2) Bill, 2019, introduced an amendment to the Eighth Schedule of the Finance Act, 2002, which revised the Special Additional Excise Duty rates on petrol and diesel. Effective from July 6, 2019, the duty on motor spirit, commonly known as petrol, increased from Rs. 7 to Rs. 10 per litre, while the duty on high-speed diesel oil rose from Rs. 1 to Rs. 4 per litre. These changes were implemented immediately under the Provisional Collection of Taxes Act, 1931.
Bill:
Summary: The Finance (No. 2) Bill, 2019, amends the Sixth Schedule of the Finance Act, 2018, specifically altering the scheduled rate of Road and Infrastructure cess on petrol and diesel. Effective from July 6, 2019, the additional duty of excise on motor spirit (petrol) and high-speed diesel oil increases from Rs. 8 per litre to Rs. 10 per litre. This change is implemented immediately under the Provisional Collection of Taxes Act, 1931.
Bill:
Summary: The Finance (No. 2) Bill, 2019, introduced changes to the rates of Special Additional Excise Duty and Road and Infrastructure Cess on petrol and diesel. The duty on petrol increased from Rs. 7 to Rs. 8 per litre, and on high-speed diesel oil from Rs. 1 to Rs. 2 per litre. Additionally, the Road and Infrastructure Cess on both petrol and diesel was raised from Rs. 8 to Rs. 9 per litre. These adjustments are part of the Budget 2019-20 measures to increase revenue from fuel taxation.
Bill:
Summary: The Finance (No. 2) Bill, 2019 proposes retrospective service tax exemptions for specific services. Exemptions include: services by State Governments for liquor licenses from April 1, 2016, to June 30, 2017; educational programs by Indian Institutes of Management, excluding Executive Development Programmes, from July 1, 2003, to March 31, 2016; and upfront payments for long-term leases of 30 years or more for infrastructure development by State Government entities from October 1, 2013, to June 30, 2017. These amendments take effect upon the enactment of the Bill unless specified otherwise.
Bill:
Summary: The Sabka Vishwas Legacy Dispute Resolution Scheme, introduced under the Finance (No. 2) Bill, 2019, aims to resolve and settle legacy cases related to Central Excise and Service Tax. This scheme functions as both a dispute resolution and amnesty initiative, providing a mechanism for addressing outstanding tax disputes from previous periods. It is part of the broader financial measures outlined in the 2019-20 budget, designed to streamline tax administration and reduce litigation by offering taxpayers a chance to settle their dues under favorable terms.
Bill:
Summary: The Finance (No. 2) Bill, 2019, includes amendments to the Central Goods and Services Tax Act, 2017 (CGST Act), Integrated Goods and Services Tax Act, 2017 (IGST Act), and Union Territory Goods and Services Tax Act, 2017 (UTGST Act). These amendments become effective upon the Bill's enactment unless specified otherwise. Additionally, amendments in the Finance Bill, 2019, will take effect once notified, aligning with corresponding changes in legislation passed by States and Union territories with legislatures.
Bill:
Summary: The Finance (No. 2) Bill, 2019 introduces several amendments to the CGST Act, 2017. Key changes include redefining "adjudicating authority" to exclude the National Appellate Authority for Advance Ruling, introducing a new composition scheme for service providers with turnover up to Rs. 50 lakhs, and raising the exemption threshold for exclusive goods suppliers to Rs. 40 lakhs. Aadhaar authentication becomes mandatory for certain taxpayers, and electronic payment options are required for specified suppliers. The Bill also allows for the transfer of funds within the electronic cash ledger, adjusts interest charges, and empowers the National Appellate Authority with civil court powers.
Bill:
Summary: A new section 17A is introduced in the Integrated Goods and Services Tax (IGST) Act, 2017, as part of the Finance (No. 2) Bill, 2019. This amendment facilitates the transfer of funds between the central and state governments, aligning with changes in section 49 of the Central Goods and Services Tax (CGST) Act. It permits the transfer of amounts from one head to another within the electronic cash ledger of a registered person, enhancing the flexibility and efficiency of fund management under the GST framework.
Bill:
Summary: The Finance (No. 2) Bill, 2019 introduces retrospective amendments to GST rate notifications, exempting "Uranium Ore Concentrate" from various tax levies. Notification No. 2/2017-Central Tax (Rate) under the Central Goods and Services Tax Act, Notification No. 2/2017-Integrated Tax (Rate) under the Integrated Goods and Services Tax Act, and Notification No. 2/2017-Union Territory Tax (Rate) under the Union Territory Goods and Services Tax Act are amended to provide exemptions from the respective taxes on Uranium Ore Concentrate from July 1, 2017, to November 14, 2017.
Articles
By: CSSwati Rawat
Summary: The 2019 budget introduced several tax proposals aimed at reforming the economy. Direct tax revenue increased to 11.37 lakh crores. A corporate tax rate of 25% was set for companies with turnover up to 400 crores, covering 99.3% of companies. GST on electric vehicles was reduced from 12% to 5%, with an additional 1.5 lakh tax deduction on loans for purchasing them. Startups are exempt from IT Department scrutiny. Other measures include interchangeability of PAN and Aadhaar for tax returns, faceless e-assessment, and a 2% TDS on cash withdrawals over 1 crore. Custom duties were adjusted on various goods.
By: DR.MARIAPPAN GOVINDARAJAN
Summary: The Central Goods and Services Tax (Fourth Amendment) Rules, 2019 introduced several changes to the GST framework. Key amendments include the introduction of Rule 10A, requiring registered persons to submit bank account details, and the addition of a ground for registration cancellation if Rule 10A is violated. Rule 32A clarifies the calculation of Kerala Flood Cess. QR codes are to be added to tax invoices and bills of supply. Amendments to Rules 66 and 67 affect the electronic availability of tax deduction details. Rule 87 changes involve the electronic cash ledger, and new procedures for tax refunds at international airports were established. Anti-profiteering rules were extended, and changes to the E-way bill process were made. Several GST forms were amended or introduced.
By: Rohan Pingle
Summary: Self-motivation is a crucial force that empowers individuals to persist on their chosen paths, especially during challenging times. It serves as a personal drive that enhances confidence and resilience, enabling individuals to overcome difficulties and achieve significant goals. In competitive environments, such as exams, self-motivated individuals are more likely to succeed. The combination of self-motivation and patience is essential for accomplishing larger life objectives. Developing this internal power helps individuals remain strong in adverse situations and continue progressing.
News
Summary: The Union Minister of Finance and Corporate Affairs announced that over 90% of Integrated Goods and Services Tax (IGST) refund claims for goods exported from India have been processed by the Central Board of Indirect Taxes and Customs (CBIC). During a refund fortnight, Rs. 6,087 crore in IGST and Rs. 1,548 crore in Input Tax Credit (ITC) refunds were sanctioned. Merchant exporters are charged a nominal GST of 0.1% for domestic procurement to boost exports and address working capital issues. An e-Wallet scheme to further ease cash flow is planned for April 2020. The e-Way Bill system for goods movement has been operational since April 2018.
Summary: The deadline for availing the Alternate Composition Scheme under the Goods and Services Tax (GST) has been extended from April 30, 2019, to July 31, 2019. This scheme is available to service or mixed suppliers whose annual turnover did not exceed Rs. 50 lakhs in the previous financial year and who were not eligible for the primary composition scheme. Participants will pay a tax rate of 6% (3% CGST + 3% SGST) on their turnover. The extension was recommended by the GST Council and formalized through a corrigendum to the relevant circular. Eligible taxpayers are encouraged to apply by the new deadline.
Summary: The Union Budget 2019-20 has been praised by the Chief Statistician of India for its comprehensive approach to sustainable and equitable growth. The budget aims to achieve a $3 trillion economy by focusing on both rural and urban development. Key initiatives include a payment platform for MSMEs, the PM Karam Yogi Maan Dhan Scheme, and the Interest Subvention Scheme to enhance job creation and economic formalization. It also emphasizes women's participation in the economy through women-led initiatives and addresses gender disparity. The budget highlights infrastructure development, education, and agriculture, with a digital push to enhance data accessibility.
Summary: FDI inflows into India were strong in 2018-19, reaching USD 64.375 billion, a 6% increase from the previous year, despite global declines. The Finance Minister announced measures to enhance India's appeal as an FDI destination, including opening up FDI in aviation, media, and insurance sectors, and easing local sourcing norms for Single Brand Retail. The government plans to host an annual Global Investors Meet to attract top global investors. The statutory limit for Foreign Portfolio Investment in companies will be increased, and KYC norms streamlined to improve the investment experience without compromising cross-border capital flow integrity.
Summary: The government plans to launch a dedicated channel for start-ups within the DD network, aiming to support start-ups by providing a platform for promotion, addressing growth challenges, and facilitating connections with venture capitalists. The channel will be managed by start-ups. Proposed budget measures include relaxed conditions for carrying forward losses, extended exemptions for capital gains, and reduced restrictions on asset transfers. The angel tax issue will be addressed through e-verification, eliminating scrutiny of start-up funds by the Income Tax Department. These initiatives are designed to bolster the growth and stability of start-ups in India.
Summary: The Union Budget 2019-20, presented by the Finance Minister, outlines a 10-point vision for the decade, focusing on governance, pollution reduction, digital economy expansion, and infrastructure development. It aims for a $5 trillion economy, emphasizing investment in infrastructure, digital economy, and job creation. Key measures include pension schemes for small traders, interest subvention for MSMEs, and initiatives for electric vehicle adoption. The budget also proposes tax reforms, including reduced corporate tax rates for smaller companies and incentives for startups. It emphasizes rural development, water management, and women's empowerment, while promoting digital payments and foreign investment.
Summary: The 2019-20 Budget and Finance (No. 2) Bill, 2019 were presented on July 5, 2019. The document includes section-wise and chapter-wise breakdowns of the Finance Act and Bill, along with the Budget Speech. Supporting materials include explanatory notes on focused areas, PDF version of the Bill, and various notifications related to Customs and Central Excise dated July 6, 2019. The document also contains links to previous and subsequent budgets.
Summary: The Union Budget 2019-20 introduced several tax proposals to stimulate investments in start-ups and sunrise industries, including a lower corporate tax rate for companies with turnover up to Rs. 400 crore. Surcharge rates were increased for high-income individuals, and measures were introduced to encourage digital payments and electric vehicle adoption. Customs duties were adjusted to support domestic manufacturing and reduce import dependence. The budget also proposed tax incentives for affordable housing and modernized tax administration, including faceless assessments and pre-filled tax returns. Additional measures included a Legacy Dispute Resolution Scheme and amendments to the Customs Act to prevent violations.
Summary: India's Union Budget 2019-20 outlines a 10-point vision for the next decade, aiming to transform the nation into a $5 trillion economy by 2024-25. The budget emphasizes investment-driven growth, requiring Rs. 20 lakh crore annually, and proposes significant infrastructure investments, including Rs. 50 lakh crore for railways by 2030. Key initiatives include simplifying procedures, incentivizing performance, and leveraging technology. The government plans strategic disinvestment of public sector undertakings and enhancing skillsets for global job markets. Additionally, the budget supports MSMEs with interest subvention and proposes consolidating labor laws to reduce disputes, marking a commitment to reform, perform, and transform.
Summary: The 2019-2020 budget speech by the Finance Minister highlighted India's economic growth, aiming for a $5 trillion economy. The government plans to boost infrastructure, digital economy, and job creation, while promoting Make in India and green initiatives. Significant investments in rural development, housing, and water management are outlined. Tax reforms include lowering corporate tax rates for smaller companies, incentives for electric vehicles, and easing tax compliance for startups. The budget also emphasizes digital payments, FDI enhancements, and resolving legacy tax disputes. Key sectors like defense, aviation, and MSMEs receive targeted support to drive economic progress.
Summary: The Union Budget 2019-20, presented by the Finance Minister, outlines a vision for India to become a $5 trillion economy by 2024-25, emphasizing investment-driven growth and employment generation. Key measures include profit-linked deductions for start-ups, broadened investment-linked deductions, and incentives for employment generation. Infrastructure investment of Rs. 100 lakh crores over five years is planned. Initiatives include a Credit Guarantee Enhancement Corporation, long-term bond market development, and simplified procedures. The budget also focuses on MSMEs, education reforms, and research funding. It proposes streamlining labor laws and launching a TV program for start-ups to boost economic growth and employment.
Summary: The 2019-20 budget proposes increased tax rates for individuals earning between Rs. 2 crore to Rs. 5 crore and above Rs. 5 crore by 3% and 7%, respectively. Direct tax revenue rose by over 78% from FY 2013-14 to FY 2018-19. Relief measures include a restricted Securities Transaction Tax, additional deductions for affordable housing loans, and tax benefits on electric vehicle loans. The budget also mandates tax return filing for individuals with significant financial transactions and offers incentives for the International Financial Services Centre. Non-Banking Financial Companies will receive tax treatment similar to banks for bad debts.
Summary: The Union Budget 2019-20 introduces several measures to boost capital sources for infrastructure financing. A Credit Guarantee Enhancement Corporation will be established in 2019-20, as announced by the Finance Minister. The plan includes deepening the market for long-term bonds, focusing on corporate bond repos and credit default swaps, particularly in the infrastructure sector. Additionally, investments by Foreign Institutional Investors and Foreign Portfolio Investors in debt securities issued by Infrastructure Debt Fund-Non-Banking Financial Companies can be transferred to domestic investors within a specified lock-in period. These initiatives aim to facilitate investment-driven growth by ensuring access to low-cost capital.
Summary: The Union Budget 2019-20, presented by the Finance Minister, proposes measures to enhance the Corporate Debt markets, emphasizing their importance for the infrastructure sector. The government plans to collaborate with regulators like RBI and SEBI to permit stock exchanges to accept AA rated bonds as collateral. Despite an increase in bond issuances, there has been a recent decline, with a preference for private placements. To address this, the budget suggests deepening the Corporate tri-party repo market and improving the user-friendliness of trading platforms for corporate bonds, including addressing issues related to the capping of ISINs.
Summary: The Union Budget aims to position India as a global hub for electric vehicle manufacturing by including solar storage batteries and charging infrastructure in the FAME scheme, which will boost production. The government proposes reducing GST on electric vehicles from 12% to 5% and offering an additional income tax deduction of Rs. 1.5 lakh on interest paid for loans to purchase electric vehicles. Phase II of the FAME scheme, with a budget of Rs. 10,000 crore over three years, focuses on incentivizing advanced battery and registered e-vehicles and enhancing public transport options. Customs duty exemptions on certain electric vehicle parts are also planned.
Summary: The Union Budget 2019-20 proposes establishing a social stock exchange under the Securities and Exchange Board of India (SEBI) to list social enterprises and voluntary organizations. This initiative aims to bring capital markets closer to the public and support social welfare and financial inclusion. The Finance Minister emphasized creating an electronic fundraising platform for these organizations to raise capital through equity, debt, or mutual fund-like units. Additionally, the government plans to enhance the inter-operability of Reserve Bank of India (RBI) and SEBI depositories to facilitate the seamless transfer of treasury bills and government securities, in collaboration with RBI and SEBI.
Summary: The government plans to infuse Rs. 70,000 crore into Public Sector Banks to enhance credit availability, alongside a six-month partial credit guarantee for first loss of up to 10%. Efforts are underway to strengthen the Reserve Bank of India's regulatory authority over Non-Banking Financial Companies (NBFCs) through the Finance Bill. The Finance Minister announced reforms to improve governance in banks and measures to empower account holders. The banking sector has seen significant recovery, with reduced NPAs and increased credit growth. Additionally, the consolidation of banks and easing of restrictions on NBFCs are highlighted as part of the broader financial reforms.
Summary: The Indian government prioritizes providing safe and adequate drinking water to all citizens, aiming for piped water supply to all rural households by 2024 through the Jal Jeevan Mission. The newly established Jal Shakti Mantralaya will manage water resources and supply in collaboration with state governments. This initiative involves integrating various ministries and focusing on local water management, including rainwater harvesting and wastewater reuse. The government has identified critical areas for intervention and plans to utilize funds from existing schemes and the Compensatory Afforestation Fund Management and Planning Authority to support these efforts.
Summary: The Union Budget emphasizes significant investment in infrastructure, the digital economy, and job creation in small and medium enterprises to propel India towards a $5 trillion economy. Key proposals include public-private partnerships in railways, development of state road networks, and initiatives in civil aviation to make India a hub for aircraft financing. The budget allocates Rs. 350 crore for MSMEs under an interest subvention scheme and introduces a payment platform to reduce payment delays. Additionally, reforms in the power sector and housing, including a Model Tenancy Law, are planned. The Pradhan Mantri Karam Yogi Maandhan Scheme will extend pension benefits to small traders.
Summary: The government is considering issuing Aadhaar cards to Non-Resident Indians with Indian passports and plans to open four new embassies in 2019-20. Seventeen iconic tourism sites are being developed into world-class destinations. The Indian Development Assistance Scheme (IDEAS) will be revamped to enhance economic cooperation through various financing models. A mission will be launched to integrate traditional artisans with global markets, including obtaining patents and geographical indicators. Additionally, a digital repository will be created to preserve tribal cultural heritage. These initiatives were announced by the Union Finance Minister during the Union Budget 2019-20 presentation.
Summary: The Union Budget 2019-20 announced several tax reforms, including extending the 25% corporate tax rate to companies with an annual turnover up to Rs. 400 crore, covering 99.3% of companies. It also proposed the interchangeability of PAN and Aadhaar for filing tax returns, pre-filled tax returns to improve accuracy, and a faceless e-assessment scheme to eliminate undesirable practices. A 2% TDS on cash withdrawals over Rs. 1 crore aims to promote digital payments, with businesses over Rs. 50 crore turnover required to offer low-cost digital payment modes without charges. These measures aim to simplify tax compliance and encourage a digital economy.
Summary: The government plans to ensure all listed Public Sector Undertakings (PSUs) comply with the 25% public shareholding norm to enhance public ownership and market orientation. Additionally, foreign shareholding limits for PSU companies in the Emerging Market Index will be increased to sectoral maximums. New coins, easily identifiable by the visually impaired, will soon be available. The government will also begin raising part of its Gross Borrowing Programme in external markets, leveraging India's low sovereign external debt to GDP ratio. These measures were announced during the presentation of the Union Budget 2019-20 by the Union Finance Minister.
Summary: The Union Budget 2019-20 proposes allowing 100% Foreign Direct Investment (FDI) for insurance intermediaries and easing local sourcing norms for FDI in the Single Brand Retail sector. It suggests rationalizing Know Your Customer (KYC) norms to facilitate foreign portfolio investments and merging the NRI-Portfolio Investment Scheme with the Foreign Portfolio Investment Route for easier access to Indian equities. The government plans to explore further FDI openings in aviation, media, and insurance sectors. Additionally, the budget aims to increase the statutory limit for FPI investment in companies and organize an Annual Global Investors Meet to enhance India's integration into the global financial system.
Summary: The government has set a disinvestment target of Rs. 1,05,000 crore for the financial year 2019-20, as announced by the Union Minister of Finance during the Union Budget presentation. This includes the strategic sale of public sector undertakings (PSUs) and the re-initiation of Air India's disinvestment. The policy will allow government stakes in non-financial PSUs to potentially fall below 51% if necessary, while still maintaining control. The government plans to modify its stake retention policy to include stakes held by government-controlled institutions. Strategic disinvestment of select central public sector enterprises (CPSEs) will remain a priority, with more CPSEs opening for private sector participation.
Summary: The government plans to set up an Expert Committee to recommend the structure and fund flow through development finance institutions, as announced in the Union Budget 2019-20. Regulatory authority over the housing finance sector is proposed to shift from NHB to RBI. The NPS Trust will be separated from PFRDA to ensure an independent organizational structure. A partial credit guarantee for public sector banks is proposed to support NBFCs. Additionally, the Net Owned Fund requirement for foreign reinsurers will be reduced, and amendments to the Factoring Regulation Act, 2011, will allow broader NBFC participation on the TReDS platform.
Summary: The government announced increased funding for several major schemes in its latest budget, focusing on infrastructure, healthcare, and education. The budget aims to boost economic growth and improve public services by allocating substantial resources to these sectors. Key initiatives include expanding rural road networks, enhancing healthcare facilities, and upgrading educational institutions. The government also plans to introduce tax reforms to support these initiatives, aiming to streamline processes and increase revenue. This budget reflects a commitment to sustainable development and improving the quality of life for citizens by addressing critical areas of public welfare.
Summary: India is set to commercialize its space capabilities through New Space India Limited (NSIL), a newly incorporated commercial arm of the Department of Space. Announced by the Finance Minister during the Union Budget 2019-20, NSIL aims to leverage India's advanced space technology and cost-effective satellite launch capabilities. The company will focus on the commercialization of space products, including the production of launch vehicles, technology transfers, and marketing. This initiative seeks to capitalize on the research and development conducted by the Indian Space Research Organisation (ISRO), positioning India as a significant player in the global space industry.
Summary: Expenditure
Budget
Dated:- 5-7-2019
News - Press release - PIB
Summary: Receipts
Budget
Dated:- 5-7-2019
News - Press release - PIB
Summary: Budget Profile
Budget
Dated:- 5-7-2019
News - Press release - PIB
Summary: The central government announced a budget allocation aimed at transferring resources to states and union territories with legislatures. This financial distribution is designed to support local governance and development initiatives, ensuring that regional administrations have the necessary funds to implement various projects and services. The allocation is part of a broader fiscal strategy to enhance economic growth and improve public infrastructure across the country, reflecting the government's commitment to equitable resource distribution and regional empowerment.
Summary: Deficit Statistics
Budget
Dated:- 5-7-2019
News - Press release - PIB
Summary: Budget at a Glance
Budget
Dated:- 5-7-2019
News - Press release - PIB
Summary: Pradhan Mantri Awas Yojana - Gramin (PMAY-G) aims to provide housing for all by 2020, with 1.54 crore rural homes completed in the last five years and an additional 1.95 crore houses planned by 2022. These homes will include amenities like toilets, electricity, and LPG connections. The Pradhan Mantri Gram Sadak Yojana (PMGSY-III) plans to upgrade 1,25,000 km of roads at a cost of Rs. 80,250 crore over five years. By 2020, every rural family is expected to have electricity and clean cooking facilities, with significant progress already made through the Ujjwala and Saubhagya Yojanas.
Summary: The Union Budget 2019-20, presented by the Finance Minister, proposes leveraging Public-Private Partnerships (PPP) to expedite the development of railway infrastructure, including tracks, rolling stock manufacturing, and passenger freight services. A Special Purpose Vehicle (SPV) is suggested for investment in suburban railways, with initiatives like the Rapid Regional Transport System on the Delhi-Meerut route. The government aims to complete the dedicated freight corridor by 2022 and launch a comprehensive railway station modernization program. The budget estimates a need for Rs. 50 lakh crores investment in railway infrastructure from 2018 to 2030, promoting metro-railway initiatives and transit-oriented development.
Summary: The budget, dated July 5, 2019, introduces several key features aimed at economic growth and fiscal stability. It proposes tax reforms, including adjustments in income tax slabs and corporate tax rates, to boost investment and consumer spending. Infrastructure development receives a significant boost with increased allocations for transportation and urban development projects. The budget also emphasizes social welfare, with enhanced funding for healthcare, education, and rural development initiatives. Measures to promote digital economy and start-ups are highlighted, alongside efforts to improve ease of doing business. Overall, the budget aims to foster inclusive growth and economic resilience.
Summary: The Union Budget focuses on bolstering Micro, Small, and Medium Enterprises (MSMEs) to enhance the Make in India initiative. Key measures include a Rs. 350 crore allocation for an Interest Subvention Scheme, offering 2% interest relief on loans for GST-registered MSMEs, and a new pension scheme for three crore retail traders and small shopkeepers with turnovers under Rs. 1.5 crore. Additionally, 100 new clusters under SFURTI and 100 business incubators will be established to support artisans and entrepreneurs. The budget also proposes changes in customs duties to protect domestic industries and promote local manufacturing.
Summary: The government aims to enhance women's participation in India's growth, particularly in rural areas, as announced in the Union Budget 2019-20. Initiatives include extending the Women Self Help Group interest subvention program to all districts and providing verified SHG members with a Jan Dhan Bank Account an overdraft of Rs. 5,000. Additionally, one woman per SHG will be eligible for a loan up to Rs. 1 lakh under the MUDRA Scheme. A committee with government and private stakeholders will be formed to evaluate further actions. These efforts are part of broader support for women entrepreneurship through schemes like MUDRA and Stand UP India.
Summary: The Stand-Up India Scheme has been extended until 2025, as announced by the Finance Minister during the Union Budget 2019-20 presentation. This initiative has supported numerous entrepreneurs, particularly women and individuals from Scheduled Castes and Tribes, by providing capital for business ventures. Banks will offer financial assistance for demand-based businesses, including scavenging machines and robots. The government plans to consolidate multiple labor laws into four labor codes to streamline processes and reduce disputes. Additionally, there is an emphasis on skill development in areas like AI, Big Data, and Robotics to enhance employability and remuneration. The government has increased its contribution to the Pension Scheme, benefiting millions.
Summary: The Union Budget 2019-20 introduced measures to alleviate scrutiny over start-up share premium valuations, resolving the Angel Tax issue. Start-ups and investors filing necessary declarations will avoid valuation scrutiny, supported by an e-verification mechanism for investor identity and fund sources. Special arrangements by the Central Board of Direct Taxes will address pending assessments and grievances. Benefits will extend to Category-II Alternative Investment Funds, and conditions for loss carry forward and capital gains exemptions will be relaxed. A dedicated TV program for start-ups and a scheme inviting global companies to set up manufacturing plants in advanced technology areas were also proposed.
Summary: The government aims to enhance ease of living through technology, as highlighted in the Union Budget 2019-20. Initiatives include promoting solar stoves and battery chargers using the LED bulb mission method, and launching a massive railway station modernization program to improve travel experiences. Digital payments are increasingly accepted, including by the government. The Pradhan Mantri Shram Yogi Maandhan scheme, launched in March 2019, provides a pension of Rs. 3,000 per month for workers in unorganized sectors upon reaching 60. The UJALA Yojana has distributed 35 crore LED bulbs, saving Rs. 18,341 crores annually, significantly reducing incandescent bulb and CFL usage.
Summary: The Union Budget 2019-20 introduces several changes to simplify GST processes and adjust indirect taxes. Businesses with annual turnovers below Rs. 5 crore will file quarterly GST returns, and the threshold for goods suppliers increases from Rs. 20 lakh to Rs. 40 lakh. The Sabka Vishwas Legacy Dispute Resolution Scheme aims to resolve pre-GST litigations. Customs duty exemptions are provided for defense equipment not manufactured in India, while duties on gold, precious metals, and certain items are increased to support domestic industries. Excise duties on petrol, diesel, and tobacco products are raised, and electronic invoicing is set to streamline GST compliance from January 2020.
Summary: The Union Budget 2019-20 allocates Rs. 400 crore to develop world-class educational institutions, a significant increase from the previous year. The government plans to introduce a New National Education Policy to enhance both school and higher education, focusing on governance, research, and innovation. A National Research Foundation will be established to coordinate and promote research. Additionally, a National Sports Education Board will be set up under the Khelo India Scheme. The budget also includes initiatives like "Study in India" to attract foreign students and proposes the Higher Education Commission of India to reform the regulatory system for higher education.
Summary: The Scheme of Fund for Upgradation and Regeneration of Traditional Industries (SFURTI) aims to establish more Common Facility Centres to generate employment opportunities. The initiative plans to create 100 new clusters in 2019-20, benefiting 50,000 artisans. Additionally, 10,000 new Farmer Producer Organizations will be formed over five years to enhance economies of scale. The Pradhan Mantri Matsya Sampada Yojana will develop a fisheries management framework. The government will support agricultural infrastructure and private entrepreneurship to add value to farmers' produce. Initiatives like e-NAM and Zero Budget Farming aim to improve farmers' income and ease of living.
Summary: The Finance (No.2) Bill, 2019, introduced on July 5, 2019, outlines various fiscal measures aimed at enhancing economic growth and stability. Key highlights include adjustments in tax rates, incentives for startups, and initiatives to promote digital payments. The bill also proposes increased spending on infrastructure and rural development, alongside measures to boost foreign investment. Additionally, it addresses compliance simplification and introduces new tax provisions to curb evasion. These steps are designed to stimulate investment, improve ease of doing business, and ensure equitable tax administration.
Summary: The Finance (No. 2) Bill, 2019 proposes amendments to the Income-tax Act, 1961 to enhance the effectiveness of tax administration, widen the tax base, and promote a less cash economy. Key proposals include reducing corporate tax rates for small enterprises, introducing tax incentives, and strengthening anti-abuse measures. The Bill also suggests changes in tax rates, such as surcharges on income tax for high-income individuals and companies, and the introduction of a Health and Education Cess. Additionally, it proposes measures to facilitate the resolution of distressed companies and improve the efficiency of tax administration. The Bill aims to ensure compliance and reduce tax evasion.
Summary: The Competition Commission of India is seeking applications to fill a vacant Member position. This announcement, made on July 5, 2019, is part of a press release by the Press Information Bureau. The role is integral to the functioning of the Commission, which plays a critical role in maintaining fair competition in the market. Interested candidates are encouraged to apply, adhering to the specified guidelines and requirements.
Notifications
Central Excise
1.
06/2019 - dated
6-7-2019
-
CE
Seeks to exempt crude petroleum oil produced in specified oil fields under production sharing contracts or in the exploration blocks offered under the New Exploration Licensing Policy (NELP) through international competitive bidding.
Summary: The Government of India, through the Ministry of Finance, issued Notification No. 6/2019-Central Excise, exempting crude petroleum oils and oils obtained from bituminous minerals produced in specific oil fields and exploration blocks from excise duty. This exemption applies to fields under Production Sharing Contracts and those offered under the New Exploration Licensing Policy (NELP) through international competitive bidding. The listed fields include Panna and Mukta, Ravva, Kharsang, and others, totaling 26 fields. This measure is enacted under the authority of the Central Excise Act, 1944, aiming to serve the public interest by reducing excise duties on these resources.
2.
05/2019 - dated
6-7-2019
-
CE
Seeks to increase the effective rate of Special Additional Excise Duty on Petrol and Diesel.
Summary: The Government of India, through the Ministry of Finance, issued Notification No. 5/2019-Central Excise on July 6, 2019, to adjust the Special Additional Excise Duty on petrol and diesel. Under the authority of the Finance Act, 2002, and the Central Excise Act, 1944, the notification specifies new duty rates: Rs. 11 per litre for petrol and Rs. 8 per litre for diesel. These rates are effective for goods specified in the Fourth Schedule of the Excise Act. Subsequent amendments and substitutions to these rates were made through various notifications, with exemptions for goods cleared for export.
3.
04/2019 - dated
6-7-2019
-
CE
Seeks to increase the effective rate of Road and Infrastructure Cess as additional duty of excise on Petrol and Diesel.
Summary: The Government of India, through Notification No. 4/2019-Central Excise, dated July 6, 2019, exercised its powers under the Finance Act, 2018, and the Central Excise Act, 1944, to adjust the additional duty of excise on petrol and diesel. The notification specifies exemptions for excisable goods, reducing the additional duty to Rs. 5 per litre for petrol and Rs. 2 per litre for high-speed diesel oil. The adjustments were made in the public interest and detailed in a table outlining the applicable rates. Subsequent notifications have modified these rates over time.
4.
03/2019 - dated
6-7-2019
-
CE
Seeks to increase the basic excise duty on specified goods in chapter 24 under section 5A of the Central Excise Act 1944.
Summary: The Government of India, through the Ministry of Finance's Department of Revenue, issued Notification No. 03/2019-Central Excise on July 6, 2019, under the Central Excise Act, 1944. This notification exempts specified excisable goods under Chapter 24 from certain excise duties, as detailed in a table. The exemptions apply to various tobacco products, including cigarettes, cigarillos, and chewing tobacco, with specific rates outlined for different product categories. Some items are exempt from duty entirely, while others have reduced rates, such as Rs. 5 per thousand for certain cigarettes and 0.5% for other tobacco products.
5.
02/2019 - dated
6-7-2019
-
CE
Seeks to further amend notification No. 11/2017-Central Excise dated 30th June 2017 so as to omit an entry with respect to chapter 24.
Summary: The Government of India, under the Ministry of Finance, has issued Notification No. 02/2019-Central Excise, dated July 6, 2019, to amend Notification No. 11/2017-Central Excise. This amendment involves the omission of certain entries related to Chapter 24 in the existing notification. Specifically, the words "of the First Schedule" in the column heading and Sl. No. 1, along with its related entries, are to be removed. This change is made under the authority of the Central Excise Act, 1944, in the interest of public necessity.
Customs
6.
27/2019-Customs - dated
6-7-2019
-
Cus
Seeks to further amend notification No 27/2011-Customs dated 1st March 2011 to reduce the export duty on EI tanned leather and Hides, skins and leathers, tanned and untanned, all sorts.
Summary: The Government of India, through the Ministry of Finance, has issued Notification No. 27/2019-Customs, dated July 6, 2019, amending Notification No. 27/2011-Customs. This amendment reduces the export duty on EI tanned leather and hides, skins, and leathers, both tanned and untanned. Specifically, the duty for S. No. 26 is now set to "Nil," and a new entry, S. No. 38A, has been added for hides, skins, and leathers with a duty rate of 40. This action is taken under the powers granted by section 25 of the Customs Act, 1962, in the public interest.
7.
26/2019-Customs - dated
6-7-2019
-
Cus
Seeks to further amend notification No 14/2006-Customs dated 1st March 2006 in order to change the classification of other dyed fabrics of nylon from “5407 42 00” to “5407 42”
Summary: The Government of India, Ministry of Finance, has issued Notification No. 26/2019-Customs, amending Notification No. 14/2006-Customs dated March 1, 2006. This amendment changes the classification of certain dyed nylon fabrics from "5407 42 00" to "5407 42" in the customs tariff. The modification applies to serial numbers 41 and 42 in the notification's table. This adjustment is made under the powers granted by section 25 of the Customs Act, 1962. The principal notification was last amended by Notification No. 81/2017-Customs on October 27, 2017.
8.
25/2019-Customs - dated
6-7-2019
-
Cus
Seeks to further amend notification No 50/2017-Customs dated 30th June, 2017 so as to prescribe effective rate of Basic Customs Duty (BCD).
Summary: The Government of India, through the Ministry of Finance, has issued Notification No. 25/2019-Customs, amending the previous Notification No. 50/2017-Customs to update the effective rates of Basic Customs Duty (BCD) on various goods. The amendments include the omission, substitution, and insertion of specific serial numbers and entries in the notification's table, affecting items like prawn feed, uranium ore, naphtha, methyloxirane, and raw materials for artificial kidneys. The notification also introduces changes to conditions and lists associated with customs duties, reflecting adjustments in duty rates for specific goods and manufacturing components.
9.
24/2019-Customs - dated
6-7-2019
-
Cus
Seeks to further amend notification No 57/2017-Customs dated 30th June, 2017 to explicitly exclude the specified electronic items from scope of entry at S.No.6A of the notification and to provide the effective rates on other goods.
Summary: The Government of India has issued Notification No. 24/2019-Customs to amend Notification No. 57/2017-Customs. The amendment explicitly excludes certain electronic items, such as connectors, microphones, receivers, speakers, and SIM sockets, from the scope of entry at S.No. 6A. Additionally, entries related to S. Nos. 11 and 12 have been omitted. For S. No. 13, the amendment specifies that all goods, except chargers or adapters for cellular mobile phones, CCTV cameras, IP cameras, digital video recorders, and network video recorders, are included. This amendment is made under the authority of Section 25 of the Customs Act, 1962, in public interest.
10.
23/2019-Customs - dated
6-7-2019
-
Cus
Seeks to further amend notification No 25/2005-Customs dated 1st March, 2005 to explicitly provide BCD exemption on the specified parts of line telephone handset.
Summary: The Government of India, through the Ministry of Finance, has issued Notification No. 23/2019-Customs, dated July 6, 2019, amending Notification No. 25/2005-Customs from March 1, 2005. This amendment explicitly provides for a Basic Customs Duty (BCD) exemption on specified parts of line telephone handsets. This change is made under the authority of the Customs Act, 1962, and is deemed necessary in the public interest. The amendment involves substituting the entry for S.No. 9 in the original notification to include parts of line telephone handsets under the tariff heading 8518 30 00.
11.
22/2019-Customs - dated
6-7-2019
-
Cus
Seeks to further amend notification No 25/2002-Customs dated 1st March, 2002 to exempt specified capital goods use for manufacture of specified electronic items.
Summary: The Central Government of India has issued Notification No. 22/2019-Customs to amend Notification No. 25/2002-Customs, dated 1st March 2002. This amendment exempts specified capital goods used in the manufacture of certain electronic items from customs duties. The notification details the omission and substitution of various entries in the existing notification, specifying new tariff items and descriptions for various machinery and equipment. These amendments aim to support the electronics manufacturing sector by reducing the cost of importing essential capital goods. The changes are effective from 6th July 2019.
12.
21/2019-Customs - dated
6-7-2019
-
Cus
Seeks to further amend notification No 25/98-Customs dated 2nd June 1998 to update the classification of the goods in the notification.
Summary: The Government of India, through the Ministry of Finance, has issued Notification No. 21/2019-Customs, amending the previous Notification No. 25/98-Customs dated June 2, 1998. This amendment updates the classification of goods related to semiconductor manufacturing and processing equipment. The notification replaces the original table with a new one that specifies various semiconductor-related apparatus, machines, and parts, along with their respective tariff headings or sub-headings. This change aims to align with current industry standards and is enacted under the authority of the Customs Act, 1962, in the public interest.
13.
20/2019-Customs - dated
6-7-2019
-
Cus
Seeks to further amend notification No. 52/2017-Customs dated 30th June 2017 so as to increase the effective rate of Basic Customs Duty on petroleum crude.
Summary: The Government of India, through the Ministry of Finance, has issued Notification No. 20/2019-Customs to amend Notification No. 52/2017-Customs dated 30th June 2017. This amendment increases the Basic Customs Duty on petroleum crude to Re 1 per tonne while maintaining a NIL rate for all other goods under the same classification. This change is made under the authority of section 25 of the Customs Act, 1962. The amendment aims to adjust the customs tariff on specific goods, particularly petroleum crude, as part of the government's fiscal policy.
14.
19/2019-Customs - dated
6-7-2019
-
Cus
Exemption to specified defense equipment and their parts imported in India by the Ministry of Defence, Government of India or the defence forces
Summary: Notification No. 19/2019-Customs, issued by the Ministry of Finance, exempts specified defense equipment and parts imported into India by the Ministry of Defence, defense forces, or associated public sector units from customs duties and integrated taxes. This exemption applies to items such as steam turbines, turbojets, helicopters, aircraft, and various military vehicles and weapons, provided they meet certain conditions. An officer of at least Joint Secretary rank must certify the goods' specifications and intended defense use. The notification is effective until July 1, 2029, and includes various amendments and substitutions over time.
15.
18/2019-Customs - dated
6-7-2019
-
Cus
Effective rate of ROAD AND INFRASTRUCTURE CESS - additional duty of customs leviable thereon u/s 111 of Finance Act, 2018
Summary: The Government of India, under the Ministry of Finance, issued Notification No. 18/2019-Customs on July 6, 2019, to exempt specific goods from additional customs duties as per the Finance Act, 2018. The exemption applies to motor spirit (petrol) and high-speed diesel oil, reducing the additional duty to Rs. 5 per litre for petrol and Rs. 2 per litre for diesel when imported into India. This notification was made under the authority of section 111 of the Finance Act, 2018, and section 25 of the Customs Act, 1962, in the public interest. Subsequent amendments have adjusted these rates over time.
Circulars / Instructions / Orders
Service Tax
1.
213/3/2019 - dated
5-7-2019
Provisions in the Cenvat Credit Rules 2004 regarding reversal of credit
Summary: The circular issued by the Ministry of Finance addresses the provisions in the Cenvat Credit Rules 2004 concerning the reversal of credit for services. It clarifies that not all services listed in notification 26/2012-Service Tax automatically qualify as "exempted services." They must meet specific conditions under section 2(e) of the Cenvat Credit Rules, 2004. Additionally, it states that for services involving the supply of food or drink under section 66E(i) of the Finance Act, 1994, no further credit reversal is required beyond the restrictions in rule 2C of the Service Tax (Determination of Value) Rules 2006.
GST
2.
CBEC/20/16/4/2018-GST (Pt. I) - dated
1-7-2019
Corrigendum to Circular No. 97/16/2019-GST dated 5th April, 2019 issued vide F. No. CBEC/20/16/4/2018-GST (Pt. I)
Summary: The corrigendum to Circular No. 97/16/2019-GST, issued by the Ministry of Finance's Department of Revenue, amends the deadline for registered persons opting for a 3% central tax payment under a specific notification. The original deadline of 30th April 2019 is extended to 31st July 2019. Registered persons must file intimation in FORM GST CMP-02 and submit a statement in FORM GST ITC-03 as per the specified rules. Authorities are requested to issue trade notices to publicize this update, and any implementation difficulties should be reported to the Board.
DGFT
3.
17/2015-2020 - dated
4-7-2019
Issue of Advance Authorization where import item is 'Pulses' and/or 'Peas' of any kind falling under restricted/prohibited category
Summary: The Directorate General of Foreign Trade, under the Ministry of Commerce and Industry, has announced that Advance Authorizations will no longer be issued for the import of pulses and peas that fall under the restricted or prohibited category, including those subject to quotas or State Trading Enterprises (STE) regulations. This decision is effective immediately, as per the powers granted by the Foreign Trade Policy 2015-2020. This measure aims to regulate the importation of these commodities by restricting their entry under the specified categories.
4.
16/2015-2020 - dated
4-7-2019
Implementation of the Track and Trace system for export of Pharmaceuticals and drug consignments alongwith maintaining the Parent-Child relationship in the levels of packaging and their movement in supply chain — Extension of date of implementation
Summary: The Government of India has extended the implementation date for the Track and Trace system for pharmaceutical exports, which includes maintaining the Parent-Child relationship in packaging levels, to April 1, 2020. This extension applies to both Small Scale Industries (SSI) and non-SSI manufactured drugs. The amendment modifies the Handbook of Procedure 2015-20, replacing the previous deadline of July 1, 2019. The Track and Trace system aims to ensure accurate tracking of drug consignments throughout the supply chain, with data uploaded to a Central Portal.
Customs
5.
D.O.F.No. 334/3/2019-TRU - dated
5-7-2019
D.O. Letter from JS(TRU-I)
Summary: The Finance (No. 2) Bill, 2019, introduced in the Lok Sabha, proposes changes in Customs, Central Excise, Service Tax, and GST laws and rates. Effective from July 6, 2019, these changes include revised duty rates on various goods, such as cashew kernels, petroleum, and tobacco products. The Bill also aims to amend the Customs Act, 1962, to facilitate trade and improve compliance, including provisions for Aadhaar verification and penalties for fraudulent duty payments. Additionally, the Central Goods and Services Tax Act, 2017, will be amended to enhance compliance, including increased exemption limits and mandatory Aadhaar authentication for certain taxpayers. The "Sabka Vishwas Legacy Dispute Resolution Scheme, 2019" is introduced for resolving legacy tax disputes.
Highlights / Catch Notes
GST
-
Court Halts Coercive Action on IGST Ocean Freight Dispute, Questions Validity of Notification No. 8/2017-IGST.
Case-Laws - HC : Levy of IGST on Ocean Freight - Vires of Notification No. 8/2017-IGST - no coercive steps shall be taken against the petitioner pursuant to the impugned notification in the meanwhile.
Income Tax
-
Compensation for waiving the right to sue over property purchase is a capital receipt, not taxable.
Case-Laws - AT : Compensation received for foregoing the rights to sue against purchase of property - revenue or capital receipt - Once the compensation is held to be is only on account of foregoing right to sue, which is a right in personam the same cannot be brought to tax
-
Red Diary Cash Advances Not Undisclosed Income u/s 271AAB; No Penalty Imposed for Non-Tangible Assets.
Case-Laws - AT : Penalty U/s 271AAB - red diary found in search, wherein there are notings relating to cash advances given - as per the definition of undisclosed income u/s 271AAB, the said cash advance cannot be stated to be income which is represented by any money, bullion, jewellery or other valuable article or thing - no penalty
-
Hoarding Construction Charges Classified as Revenue Expenses Due to Recurring Nature, Not Capital Expenses Under Tax Law.
Case-Laws - AT : Disallowing hoarding construction charges - huge expenses - long term utility - such expenditure is a recurring expenditure which is required to be incurred by the assessee regularly and the same therefore cannot be said to have given any enduring benefit to the assessee in capital field - allowed as revenue expenses
-
No Penalty Imposed: Assessee's Bona Fide Explanation and Full Disclosure u/s 271(1)(c) Leads to Relief.
Case-Laws - AT : Penalty u/s 271(1)(c) - agreed addition based on statement in survey u/s 133A - since the assessee has explained the circumstances under which the addition in question has been made and further established that the explanation is bonafide and it has disclosed all the facts material to the computation of its total income - no penalty
-
Taxpayer Wins: Only Peak Credit Amount Taxable When Revenue Lacks Evidence of Other Uses for Withdrawals.
Case-Laws - AT : Addition regarding Cash deposit in Bank Account - based on AIR Information - when there is no evidence with the Revenue that the withdrawals made by the assessee systematically from the bank account have been utilized for some other purpose other than for the unaccounted business of the assessee then the assessee should be given the benefit of peak credit theory and only the peak credit has to be sustained
-
Company Share Buybacks Subject to Dividend Distribution Tax u/s 115O; No Show Cause Notice Required for Tax Demand.
Case-Laws - HC : Dividend distribution Tax (DDT) - buy back its own shares - distribution of accumulated profit - Section 115O is a charging section on its own and they do not demand for issuing any show cause notice and then passing any order - unless the law requires, the AO need not issue notice before making a demand u/s 115O
-
Consultancy Fees for Loan Restructuring Considered Revenue Expenditure, Not Linked to Capital Base Expansion.
Case-Laws - HC : Allowability of consultancy fees - financial advisory services for restructuring of its loan which able to reduce the interest rate - expenditure incurred had nothing to do with the expansion of the capital base of the company - it was for restructuring of its loan and was by way of a revenue expenditure
Customs
-
Export Duty Reduced on EI Tanned Leather and All Types of Hides, Skins, and Leathers Under Notification No 27/2011-Customs.
Notifications : Amend notification No 27/2011-Customs to reduce the export duty on EI tanned leather and Hides, skins and leathers, tanned and untanned, all sorts.
-
Amendment to Notification No 14/2006-Customs: Changes Classification of Dyed Nylon Fabrics to "5407 42".
Notifications : Amends notification No 14/2006-Customs in order to change the classification of other dyed fabrics of nylon from “5407 42 00” to “5407 42”
-
Amendment to Notification 50/2017-Customs Sets New Basic Customs Duty Rate for Streamlined Tax Compliance.
Notifications : Amend notification No 50/2017-Customs so as to prescribe effective rate of Basic Customs Duty (BCD).
-
Customs Notification 57/2017 Amended: Electronic Items Excluded from Entry 6A; New Rates for Other Goods Established.
Notifications : Amends notification No 57/2017-Customs to explicitly exclude the specified electronic items from scope of entry at S.No. 6A of the notification and to provide the effective rates on other goods.
-
Amendment to Notification No 25/2005-Customs: BCD Exemption for Specific Parts of Line Telephone Handsets Clarified.
Notifications : Amends notification No 25/2005-Customs to explicitly provide BCD exemption on the specified parts of line telephone handset.
-
Customs Notification Amended: Specified Capital Goods for Electronic Manufacture Now Exempt from Duties to Ease Production Costs.
Notifications : Amends notification No 25/2002-Customs to exempt specified capital goods use for manufacture of specified electronic items.
-
Customs Notification 25/98 Amended to Update Goods Classification and Customs Duty Rates on Specific Items.
Notifications : Amends notification No 25/98-Customs to update the classification of the goods in the notification - Effective rate of customs duty on certain goods
-
Customs Duty on Petroleum Crude Raised: Notification No. 52/2017-Customs Amended to Adjust Import Tax Rates.
Notifications : Amends notification No. 52/2017-Customs so as to increase the effective rate of Basic Customs Duty on petroleum crude
-
India's Ministry of Defence Exempt from Customs Duties on Imported Defense Equipment to Boost Operational Readiness.
Notifications : Exemption to specified defense equipment and their parts imported in India by the Ministry of Defence, Government of India or the defence forces
-
Road and Infrastructure Cess Rate Adjustments Announced u/s 111 of Finance Act 2018; Key Notifications Included.
Notifications : Effective rate of ROAD AND INFRASTRUCTURE CESS - additional duty of customs leviable thereon u/s 111 of Finance Act, 2018
Indian Laws
-
Budget 2019-20 Bill: Tax and GST Reforms, Infrastructure Boost, Investment Incentives, and Social Welfare to Enhance Growth.
News : Budget 2019-20 + FINANCE (No. 2) BILL, 2019 with Focused Areas i.e Explanatory Notes
-
Finance Bill 2019: New Tax Rates, Increased Surcharges, Incentives for Housing, EVs, and Digital Payments to Boost Economy.
News : THE FINANCE (NO.2) BILL, 2019
IBC
-
CoC Reconsiders Withdrawal of CIRP Without Citing Legal Basis for Resubmission After Initial Rejection.
Case-Laws - Tri : Permission to withdraw the Corporate Insolvency Resolution Process (CIRP) - The resolution for withdrawal of CIRP did not obtain the required percentage of voting by the members of CoC, i.e. 90% at the first instance. Subsequently, a CoC meeting was conducted, and a resolution was voted upon for reconsideration of the withdrawal. The RP/CoC has not quoted the exact provision that empowers them to again put for the voting of the resolution which was earlier defeated.
Central Excise
-
Exemption Sought for Crude Oil from Specified Fields under Production Sharing Contracts and NELP Exploration Blocks.
Notifications : Seeks to exempt crude petroleum oil produced in specified oil fields under production sharing contracts or in the exploration blocks offered under the New Exploration Licensing Policy (NELP) through international competitive bidding.
-
Government Plans to Increase Special Additional Excise Duty on Petrol and Diesel Under Central Excise Regulations.
Notifications : Seeks to increase the effective rate of Special Additional Excise Duty on Petrol and Diesel.
-
Proposal to Increase Road and Infrastructure Cess on Petrol and Diesel to Boost Revenue and Impact Costs for Consumers.
Notifications : Seeks to increase the effective rate of Road and Infrastructure Cess as additional duty of excise on Petrol and Diesel.
-
Proposal to Increase Basic Excise Duty on Chapter 24 Goods u/s 5A of Central Excise Act 1944.
Notifications : Seeks to increase the basic excise duty on specified goods in chapter 24 under section 5A of the Central Excise Act 1944.
-
Notification No. 11/2017-Central Excise amended to remove entry on chapter 24, affecting excise duty rate.
Notifications : Amend notification No. 11/2017-Central Excise so as to omit an entry with respect to chapter 24 - Effective Rate of Duty of excise
-
PVC Pipes Classified Under Tariff Heading 3917.39 for Central Excise; Pertains to Hollow Pipes with No Other Classification.
Case-Laws - AT : Classification of goods - PVC Pipes - product is classifiable under 3917.39 i.e. the hollow pipes for which no other classification in the said chapter
-
CENVAT Credit Valid on Inputs: "Rejected Scrap" on Invoice Doesn't Prove Non-Receipt of Goods by Appellant.
Case-Laws - AT : CENVAT Credit - inputs - CR sheets dies, etc - Merely adding the word ‘rejected scrap’ in the invoice cannot be the reason to say that the goods were not received by the appellant and there is no such evidence placed on record by the Revenue.
Case Laws:
-
GST
-
2019 (7) TMI 240
Levy of IGST on Ocean Freight - Vires of Notification No. 8/2017-Integrated Tax [Rate] dated 28th June 2017 and Entry 10 of the Notification No. 10/2017- Integrated Tax [Rate] also dated 28th June 2017 - HELD THAT:- The attention of the court is also invited to the order dated 12.12.2018 passed by this court in the said writ petition, whereby the court has granted interim relief directing that no coercive steps shall be taken against the petitioner pursuant to the impugned notification in the meanwhile. Issue Notice returnable on 17th July, 2019.
-
2019 (7) TMI 239
Extension of the time period for furnishing bank guarantee - case of applicant is that the first three installments have already been paid and that the fourth installment could not be paid because the bank account of the applicant has been attached by the respondent authorities as the applicant could not furnish the bank guarantee within the period specified by this court - HELD THAT:- When the amount due and payable is Rs. 55,00,000/and three equal monthly installments have already been paid and the fourth installment could not be paid on account of the bank account of the applicant being attached, the court is of the view that the request of the applicant for extending the period for furnishing the bank guarantee is a reasonable one, more so, considering the fact that substantial amount out of the outstanding amount has already been paid. However, at the same time, it would also be necessary to protect the interest of the Revenue. Therefore, in case of default on the part of the applicant to pay any further installment, it would be necessary to permit the respondents to resort to the provisions of section 83 of the Central Goods and Services Tax Act, 2017 for attaching the bank accounts of the applicant. Application allowed.
-
2019 (7) TMI 238
Seizure of vehicle alongwith the goods - detention on the ground that the goods are undervalued - interpretation of Sections 129 and 130 of the GST Act - HELD THAT:- There are many larger issues involved in this petition, more particularly, with regard to the interpretation of Sections 129 and 130 of the GST Act. Many petitions have been admitted and are pending for consideration in this regard. We propose to pass an order directing the respondent authorities to release the goods on the writ-applicant depositing the amount of Rs. 6,07,600 i.e. Rs. 3,03,800 towards the tax and Rs. 3,03,800 towards the penalty - The vehicle as well as the goods, i.e. betel nuts, detained/seized under purported exercise of powers under Sections 129 and 130 of the GST Act shall be released immediately upon the writ-applicant depositing the amount with the concerned department. Post this matter for further hearing on 24th July 2019.
-
2019 (7) TMI 237
Profiteering - supply of construction services related to purchase of Flat - benefit of reduction in the rate of tax not passed on by passing on the additional benefit of Input Tax Credit after implementation of CST - contravention of Section 171 of CGST Act - HELD THAT:- The above project had been started after coming in to force of the GST w.e.f. 01 07.2017. It is also clear that the above Applicant had deposited the security amount for allotment of the flat on 18.08.2017 and was given the allotment on 20 11.2017 on the basis of the draw of lots held on 16.11.2017. The agreement between the above Applicant and the Respondent was executed on 13.12.2017. Therefore, it is apparent that the Applicant No. 1 had applied for allotment and was allotted the above flat after coming in to force of the GST w.e.f. 01.07.2017. Since the above project was not under execution in the pre-GST period i.e. before 01.07.2017 therefore, no comparison can be made between the ITC which was available to the Respondent before 01.07 2017 and after 01.07.2017 to determine whether the Respondent had benefitted from additional availability of ITC or not. There has been no additional benefit of ITC to the Respondent and hence he was not required to pass on its benefit to the above Applicant by reducing the price of the flat. The Applicant No. 1 could have availed the above benefit only if the above project was under execution before coming in to force of the GST as the Respondent would have been eligible to avail ITC on the purchase of goods and services after 01.07.2017 on which he was not entitled to do so before the above date. Since there was no basis for comparison of ITC available before and after 01.07.2017, the Respondent was not required to recalibrate the price of the flat due to additional benefit of ITC. It is clear from Section 171 (1) of the CGST Act, 2017, that there should either be reduction in the rate of tax or the benefit of ITC which is required to be passed on to the recipients by commensurate reduction in the price - Since there has been no reduction in the rate of tax or benefit of additional ITC to the Respondent the provisions of the above Section are not attracted in the present case and the allegation of profiteering is not established against the Respondent. Application dismissed.
-
Income Tax
-
2019 (7) TMI 236
Disallowance u/s 14A r.w. Rule 8D - interest expenses and administrative expenses - net interest earned during year - assessee claimed that these are old investments and no expenditure incurred - HELD THAT:- A perusal of the order of the ld.CIT(A) would reveal that the assessee has net interest income. It has shown interest income of Rs. 58,38,817/-therefore interest is not required to be computed for making disallowance. For buttressing our view point, we rely upon judgment of Hon ble Gujarat High Court in the case of CIT Vs. Nirma Capital Credit P.Ltd., 8 [ 2017 (9) TMI 485 - GUJARAT HIGH COURT] . The ld.AR during the course of hearing also pointed out that if the calculation is being made on the basis of 0.5% of average value of the investment, which has yielded dividend, then total expenditure could be worked at Rs. 548/- only. Therefore, considering the details submitted by the assessee as well as the fact that on similar investment no expenditure was disallowed in earlier years or in the subsequent year, we are of the view that no disallowance is required u/s 14A in the present year also. This ground of appeal is allowed.
-
2019 (7) TMI 235
Stay of demand - present demand is to the tune of Rs. 9,33,16,434 - in last interim order court has held that petitioner is at liberty to deposit appropriate amount in cash by way of security and attachment in respect of one property was lifted as well as three accounts which were also under attachment were released - HELD THAT:- All this was done with the idea that the petitioner shall pay reasonable amount. It however, appears that no concrete steps have been taken by the petitioner. As a last opportunity, we grant to the petitioner time of six weeks within which he shall deposit a sum of Rs. 5 crores with Principal Commissioner, Income Tax, Chennai, failing which this petition may be dismissed.
-
2019 (7) TMI 234
Deduction u/s 80IC - claim admissible for five years - whether assessee can start claiming the exemption at the same rate of 100% beyond the period of five years on the ground that the assessee has now carried out substantial expansion in its manufacturing unit? - HELD THAT:- As decided in M/S. AARHAM SOFTRONICS [ 2019 (2) TMI 1285 - SUPREME COURT] as defined in clause (ix) of sub-section (8) of Section 80-IC by such an undertaking or enterprise, within the aforesaid period of 10 years, the said previous year in which the substantial expansion is undertaken would become initial assessment year , and from that assessment year the assessee shall been entitled to 100% deductions of the profits and gains. Such deduction, however, would be for a total period of 10 years, as provided in sub-section (6). For example, if the expansion is carried out immediately, on the completion of first five years, the assessee would be entitled to 100% deduction again for the next five years. On the other hand, if substantial expansion is undertaken, say, in 8th year by an assessee such an assessee would be entitled to 100% deduction for the first five years, deduction @ 25% of the profits and gains for the next two years and @ 100% again from 8th year as this year becomes initial assessment year once again. However, this 100% deduction would be for remaining three years, i.e., 8th, 9th and 10th assessment years. - Decided against the Revenue Reopening of assessment u/s 147 - HELD THAT:- Once the second question of law is answered against the Revenue, it would not be a case for reopening of assessment under Section 147. Therefore, the first question of law is also answered against the Revenue
-
2019 (7) TMI 233
Dividend distribution Tax (DDT) - buy back its own shares u/s 77A of the Companies Act - distribution of accumulated profit or not - impact of pendency of application filed under 245Q before Authority for Advance Rulings - scope of amendment in Section 115QA w.e.f. 01.06.2016 - assessee contended that it has bought back its own shares under the Scheme of Arrangement and Compromise u/ss 391 to 393 of the Companies Act prior to the amendment. Section 115O of the Act mandates issuance of SCN, enquiry before passing a final order - HELD THAT:- From a plain reading of the provisions from 115O to 115QA, it is seen that Section 115 O is a charging section on its own. These Sections are self contained codes in themselves and they do not demand for issuing any show-cause notice and then passing any order. - It is to be noted that unless the law requires, the AO need not issue notice before making a demand u/s 115 O. The parliament in its wisdom brought amendments to the Finance Act and inserted Section 115 O to 115 Q with effect from 01.06.1997 (Special Provisions) to achieve an object. If any other view is taken, then the Special Provisions under Chapter XIV would become redundant and it would be opening a pandoras box. Breach of principles of natural justice - HELD THAT:- Admittedly, a notice dated 21.11.2017 was issued to the petitioner calling for details and meetings were convened, in which, indisputably, the officials of the petitioner Company participated and a detailed note explaining the various provisions of the Act have been given to them. It is pertinent to note that the object and purpose of issuing show cause notice is to put on notice to the proposed action to be initiated by the Officials and nothing else. But, a curious stand is taken by the petitioner that the letter dated 21.11.2017 cannot be construed as a showcause notice and the informal discussion cannot be substituted for a proper show-cause notice with a chance of reply and an opportunity of hearing, hence, I find no substance in the said submission. AO is prohibited from issuing the impugned order in the light of the bar prescribed in Section 245 RR - petitioner approached the Authority for Advance Rulings only on 20.03.2018 - notice issued on 21.11.2017 - HELD THAT:- Section 245R makes it clear that if the enquiry is already pending before the AO, the Authority for Advance Rulings has no jurisdiction to entertain the application. Hence, I find no force in the argument of the learned Senior Counsel for the petitioner that the impugned order does not stand in view of the bar u/s 245 RR. Writ Petition is maintainable - HELD THAT:- It is well settled that the assessee has an appeal remedy u/s 246. In this case, an unsuccessful attempt has been made by the petitioner to bypass the appeal remedy, but, I find no valid ground to entertain the Writ Petition. In that view, the Writ Petition is dismissed as not maintainable at this stage. The Writ Petition fails and the same is dismissed. However, liberty is given to the petitioner to prefer an appeal within a period of four weeks from today. If such an appeal is filed within the stipulated time, the Appellate Authority shall dispose of the same on merits.
-
2019 (7) TMI 232
Allowability of consultancy fees - financial advisory services for restructuring of its loan - capital expenditure OR revenue expenditure - Assessee was able to reduce the interest rate on its loan for the remaining period of the relevant loan agreement - HELD THAT:- In the present case, the Tribunal has come to a conclusion, as a matter of fact, that the expenditure incurred by the Assessee in payment of fees to ICICI Ltd. had nothing to do with the expansion of the capital base of the company and that the Assessee had clearly made out a case that it was for restructuring of its loan and was by way of a revenue expenditure - no question of law arises - the appeal of revenue is dismissed.
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2019 (7) TMI 231
Assessment u/s 153C - whether of notices were barred by the limitation? - Effect of amendment in Section 153C w.e.f .1st June, 2015 - can notice u/s 153C under amended provision be issued in relation to searches carried out till 31st May 2015 - HELD THAT:- With regard to the first question, the coordinate bench of this court in ANILKUMAR GOPIKISHAN AGRAWAL VERSUS ACIT, [ 2019 (6) TMI 746 - GUJARAT HIGH COURT] took the view that the writ-applications were maintainable. With regard to the second question regarding impact of amendment, the Court took the view that the Legislature has specifically made the amended provisions of Section 153C applicable with prospective effect from 01.06.2015. The Court held that if such amended provisions are not made applicable to the searches carried out prior to 01.06.2015, they would affect the substantive rights of the persons who are brought within the ambit of Section 153C by virtue of such amendment. So far as the third question is concerned with regard to the limitation, the Court took the view that when the statute itself provides for an alternative period of limitation, merely because the period of limitation is provided under the first part has elapsed; it cannot be said that the notices were barred by the limitation on such ground. It had been stated that in terms of clause (b) of subsection (1) of section 153A, the six years assessment years would be the six assessment years preceding assessment year relating to the previous year in which search is conducted or requisition made and in case any notices u/s 153C which have been issued for assessment years beyond the six assessment years referred to hereinabove, such notices would be beyond jurisdiction as the same do not fall within the six assessment years as contemplated u/s 153A. In view of the above, the petition is allowed. The impugned notice is hereby quashed and set aside. Consequently, if any Assessment Order has been passed u/s 153C , the same is also quashed and set aside.
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2019 (7) TMI 230
Low tax effect - Revision u/s 263 - undisclosed investment in shops - undisclosed income by way of receipt of cash donations - earlier also this appeal was dismissed on the ground of low tax effect and restored pursuant to MA filed by revenue - HELD THAT:- Mr. Bhatt, the learned senior standing counsel appearing for the revenue clarifies that Circular No.21/2015 dated 10th December, 2015, at the relevant point of time, was applicable only to the fresh appeals. In such circumstances, the revenue had to prefer a miscellaneous civil application for restoring this appeal to its original file. Mr. Bhatt further clarifies that later, the revenue issued a fresh circular No. 3/2018 dated 11.07.20148 clarifying that it would apply even to the pending appeals. This appeal would be covered by the above referred circular. In such circumstances, Mr. Bhatt, the learned senior counsel prays that the revenue would not be pressing this appeal. The appeal stands disposed of accordingly.
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2019 (7) TMI 229
Stay of demand - direction to pay 20% demand - disposal of appeal by CIT(A) - vide interim order court has extended the time limit of deposit by one month - HELD THAT:- This Court as an exceptional case directs the 1st respondent to dispose of the appeals within three months from the date of receipt of copy of this judgment. The petitioners, if complies with the condition of depositing 10% within four weeks from today, the petitioners are entitled to the stay of the assessment orders under challenge in the subject appeals till its disposal thereof. The petitioners, if fail, to comply with the condition now stipulated by this court, it is made clear that the petitioners are not entitled for the benefit of the stay orders. The authorities can proceed to recover the amount in accordance with law.
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2019 (7) TMI 228
Penalty u/s 271(1)(c) - defective notice - non-striking of the irrelevant column - from the notice it was not clear whether notice is for concealment of income or furnished inaccurate particulars - HELD THAT:- Respectfully following the decision of the Hon ble Supreme Court in the case of SSA s Emerald Meadows [ 2016 (8) TMI 1145 - SC ORDER] and also the decision of Hon ble High Court of Telangana A.P. in the case of Smt. Baisetty Revathi [ 2017 (7) TMI 776 - ANDHRA PRADESH HIGH COURT] and also the decision of the coordinate bench of the tribunal in the case of Konchada Sreeram [ 2017 (11) TMI 1164 - ITAT VISAKHAPATNAM] , I hold that the notice issued u/sec. 274 read with section 271 is invalid and, therefore penalty order passed by the AO is hereby cancelled.
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2019 (7) TMI 227
Addition made on account of technical knowhow fees - nature of expenditure - revenue expenditure and not capital expenditure - HELD THAT:- As decided in assessee s own case [ 2019 (6) TMI 655 - ITAT CHANDIGARH] in view of the findings of the CIT(A) that identical issue stands decided in favour of the assessee in assessment year 2009-10 [ 2013 (10) TMI 924 - ITAT CHANDIGARH] by the I.T.A.T., which has been admitted to by the Revenue also and no distinguishing facts having been brought to our notice by the Ld. DR, the Ld.CIT(A), we hold, has rightly allowed the assessee s appeal following the order of the I.T.A.T. in assessee s own case for assessment year 2009-10. We therefore find no reason to interfere in the order of the Ld.CIT(A) holding the technical knowhow expenses as revenue in nature. Addition on account of sales tax subsidy - HELD THAT:- As decided in assessee s own case [ 2019 (6) TMI 655 - ITAT CHANDIGARH] since the issue of sales tax subsidy received by the assessee by virtue of scheme of Punjab Government has already been decided by the I.T.A.T. in the case of the assessee itself in the preceding years, holding the same to be capital in nature and with no distinguishing facts having been brought to our notice by the DR, we see no reason to interfere in the order of the Ld.CIT(A) allowing the assessee s appeal following with order of the I.T.A.T. MAT computation - disallowance of claim of the assessee for deduction of the sales tax subsidy from the book profit under section 115JB - HELD THAT:- As decided in assessee s own case [ 2019 (6) TMI 655 - ITAT CHANDIGARH] we find is identical to that in H.M Steels [ 2018 (11) TMI 1628 - ITAT CHANDIGARH] ,with the Sales tax subsidy having been held to be capital in nature. In view of the same ,the issue we hold is squarely covered by the decision of the ITAT in the case of H.M Steels, following which we hold that the sales tax subsidy is to be reduced from the Book Profits for the purposes of paying tax u/s 115JB. - Assessee s appeal allowed.
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2019 (7) TMI 226
Addition regarding Cash deposit in Bank Account - based on AIR Information - receipts of unaccounted sales as well as cash in hand - assessee contended that either profit rate of 8% should be adopted on the unaccounted sales or the peak credit should be considered - HELD THAT:- A perusal of the bank statement shows that only a part of the deposits and withdrawals have been shown in the regular accounts and the assessee has not disclosed the entire deposits and withdrawals. When there is no evidence with the Revenue that the withdrawals made by the assessee systematically from the bank account, which are not shown to the Revenue, have been utilized for some other purpose other than for the unaccounted business of the assessee, therefore, we find merit in the argument of the Ld. Counsel for the assessee that the assessee should be given the benefit of peak credit theory and only the peak credit has to be sustained. Since, the assessee has calculated such peak credit at Rs. 2,38,737/-, therefore, we set aside the order of the Ld. CIT(A) and direct the AO to sustain only the peak credit of Rs. 2,38,737/- subject to his verification. Deduction u/s 54F - on enquiry the Inspector reported that the plot is lying vacant and there is no construction work carried over the said plot - HELD THAT:- We find neither the assessee has constructed the house property during the year as claimed nor deposited the long term capital gain of above amount in the specified capital gain accounts scheme. Therefore, when the assessee has not fulfilled the conditions laid down in section 54F the argument of the Ld. Counsel for the assessee that the same can be taxed only in the AY 2015-16 i.e. after the expiry of 3 years is not acceptable as not being in accordance with law. Therefore, the order of the CIT(A) on this issue is upheld and the ground raised by the assessee are dismissed. Disallowance of depreciation - depreciation on machines sold - HELD THAT:- It is the submission of the Ld. Counsel for the assessee that only an amount of Rs. 15,383/- has been claimed as excess depreciation and not Rs. 44,721/- as held by the AO and upheld by the CIT(A) and, therefore, this matter may be set aside to the file of the AO. In view of the above submission by the Ld. Counsel for the assessee and after considering the argument of the Ld. DR, we deem it proper to restore this issue to the file of the AO with a direction to verify the records and restrict the depreciation to the actual amount of excess claim. Ad-hoc addition @ 1/5th out of certain expenses - probable personal use - HELD THAT:- In our opinion, the disallowance at 20% of the expenses on ad-hoc basis appears to be on the higher side. We, therefore, restrict the disallowance to 10% of the expenses i.e. Rs. 40,489/- as against Rs. 80,979/- upheld by the CIT(A). The ground raised by the assessee is partly allowed.
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2019 (7) TMI 225
Rectification of mistake u/s. 254(2) - Levy of penalty u/s 271(1)(c) - attempt to infuse money into account through fraudulent penny stocks @ 10%, which was rightly brought to tax @ 30% by the AO - HELD THAT:- We find that the ITAT has deleted the penalty by placing reliance upon the catena of case laws. It has not been submitted by the Revenue in the aforesaid submission as to how those case laws are not applicable. The Tribunal in its order had elaborately dealt with the reasoning for deleting the penalty. Furthermore, case laws referred by ITAT dealt with various issue and on the touchstone of which penalty levied was deleted. Now, by way of this Miscellaneous Application Revenue seeks review of the order of the Tribunal, which is not permissible in the garb of rectification of mistake u/s. 254(2). Accordingly, this Miscellaneous Application filed by the Revenue stands dismissed.
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2019 (7) TMI 224
Penalty u/s 271 (1) (c) - survey action u/s 133A - assessee agreed to offer revenue @ 5% on the incremental construction work in progress on year on year basis subject to non levy penalty on such voluntary declaration - additional ground regarding invalid notice - assessee has not raised any bill as construction was not completed up to 30% - non following of revised accounting standard (AS-7) - HELD THAT:- The contents of the addendum to the contract supports the contention of the assessee that the assessee was entitled to raise the initial bill only after completion of 30% of the work awarded. In the present case since the assessee has explained the circumstances under which the addition in question has been made and further established that the explanation is bonafide and it has disclosed all the facts material to the computation of its total income, the Ld. CIT(A) has wrongly confirmed the addition made by the AO. In our considered opinion, this is not a case of concealment of particulars of income by the assessee. We do not find any active concealment of particulars of income by the assessee in the present case which is a precondition for imposing penalty under the said section.
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2019 (7) TMI 223
Disallowing hoarding construction charges - capital expenditure OR revenue expenditure - construction of hoardings per sq. ft. is as high as Rs. 200/ - huge expenses were made for construction of hoarding, the same should be giving usefulness / utility for more than one financial year - income from display charges - on enquiry Inspector s report the hoarding at 113, Dilkhusha Street near Park Circus was approximately of 1200 sq. ft, huge structure, made with angles of steel and the hoarding had been there for almost 2 years similarly the other hoardings HELD THAT:- The hoardings are temporary structures and are made with angles of steel and iron rods to affix them to the ground since these are vulnerable to rain, storm, theft and other damages. As such, affixation of the same using steel angles and iron rods was a necessity else the assessee would have not received any advertising orders. To receive advertising orders, these hoardings were required to be maintained by the assessee in a good quality condition. Further, in order to avoid corrosion of the structure and other adverse weathering effects, replacement of parts and other incidental expenses is regularly required to be done. It is also relevant to note that such expenditure is a recurring expenditure which is required to be incurred by the assessee regularly and the same therefore cannot be said to have given any enduring benefit to the assessee in capital field. The Inspector has based his findings in the impugned report by watching a hoarding after a time gap of three years. The said hoardings had underwent changes in this long time span of three years. Repair works and replacement of parts had taken place in the last few years as per the demand of the advertising business. As such, the structure existing on the date the Inspector visited the site can in no circumstances be compared with the structure which existing in the relevant AY, being AY 2012-13. We note that the assessee has been following this practice of claiming the hoarding expenses as revenue expenses in all the earlier years also and the same was not disturbed by the learned AO in any of the preceding years. There is no change in the accounting policies of the assessee in the current year vis a vis the earlier years, hence consistency should be maintained by the assessing officer. Apart from this, on identical facts, Coordinate Bench of Mumbai ITAT in the case of M/s Empress Advertising [ 2014 (7) TMI 1191 - ITAT MUMBAI] has held such expenditure is a recurring expenditure which is required to be incurred by the assessee regularly and the same therefore cannot be said to have given any enduring benefit to the assessee in capital field. Applying the ratio of the above noted judicial precedents, to the facts of the assessee`s case, it is abundantly clear that hoarding expenses incurred by the assessee are revenue in nature and are not capital in nature. Disallowance u/s 40A(2)(b) - salary to the wife of assessee - HELD THAT:- We note that Nidhi Kejriwal, being a BSC. Graduate, has benefitted the company in a number of ways and hence, the salary of Rs. 16,000/- per month was commensurate with the type of services provided by her to the assessee firm and was not unreasonable. The AO made addition purely on surmises and conjectures without bringing comparable persons having same education and experience on record to judge fair market value of Nidhi Kejriwal services. No finding was recorded by the AO that the sum of Rs. 50,000/- is unreasonable u/s 40A(2)(b). - we delete the addition
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2019 (7) TMI 222
Penalty U/s 271AAB - search and seizure operation U/s 132 - penalty imposed based on assessee admitted Undisclosed Income in its statement u/s 132(4) but could not furnish his return of income on or before the specified date - diary found in search in which certain advances are mentioned - from notice issued U/s 274 r.w.s. 271AAB it was not clear as to under which clause the case of assessee Company would fall - HELD THAT:- Every additional income declared in the return filed is not per se Undisclosed Income . What has been found during the course of search is a red diary, wherein there are certain notings relating to cash advances given to various persons totaling Rs. 4 crores. Besides the said document, there were no other incriminating document/material was found during the course of search. As per the definition of undisclosed income u/s 271AAB, the said cash advance cannot be stated to be income which is represented by any money, bullion, jewellery or other valuable article or thing. In the definition of undisclosed income, it talks about income by way of any entry in the books of account or other documents or transactions found in the course of a search under section 132 . The cash advance cannot be deemed as undisclosed Income in the context of section 271AAB. For this proposition, reliance is placed on the judgment of Silver Art Palace vs DCIT [ 2019 (4) TMI 634 - ITAT JAIPUR] where Hon ble ITAT Jaipur Bench held that such cash advances cannot be deemed as Undisclosed Income for the purpose of section 271AAB. In view of the above discussion and respectfully following the judicial pronouncements (supra), we do not find any merit for imposition of penalty in respect of declared income which is not coming in the purview of undisclosed income as defined under clause (c) to explanation to Section 271AAB . It is pertinent to mention here that no contrary decision was brought to our notice by the ld DR so as to persuade us to deviate from the conclusion drawn in the above judicial pronouncements as referred and relied by us. - both the appeals of the assessees are allowed
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2019 (7) TMI 221
Characterization of income - Compensation received for foregoing the rights in the agreement to purchase property is taxable - revenue or capital receipt - HELD THAT:- Once the compensation is held to be is only on account of foregoing right to sue, which is a right in personam the same cannot be brought to tax. Furthermore, in the case of Oberoi Hotels (P.) Ltd. vs. CIT [ 1999 (3) TMI 2 - SUPREME COURT] held that the amount received by the assessee for giving up its right to purchase or for getting it on lease is a capital receipt. Further, clause (ix) to sub s. (2) of s. 56 was inserted w.e.f assessment year 2015-16 providing to assets to tax the amount any sum of money received as an advance otherwise in the course of negotiation for transfer of capital asset if sum is forfeited and does not result in transfer of capital asset only w.e.f 01.04.2015. The amount received in giving up the right for specific performance was held to be capital receipt to the same effect in the decision of CIT vs. Smt. Laxmidevi Ratani [ 2005 (2) TMI 105 - MADHYA PRADESH HIGH COURT] . In the light of above legal position, the amount of compensation received by the assessee cannot held to be a revenue receipt, but is a capital receipt and not liable to tax and it cannot be brought to tax under capital gain for the reason that it is not a capital asset. Thus, we reverse the orders of lower authorities and allow the appeal filed by the assessee.
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Customs
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2019 (7) TMI 220
Duty Drawback - manufacturer and exporter of leather footwear - It is petitioner s case that writ petitioner is entitled to drawback as notified under Customs and Central Excise Duties Drawback Rules, 1995 till 30.06.2018 and under the Customs and Central Excise Duties Drawback Rules 2017 on and from 01.07.2017 - HELD THAT:- Impugned show-cause notice being SCN dated 24.01.2019 is not quashed, but is kept in abeyance for a period of eight weeks from the date of receipt of a copy of this order. Within the said period of eight weeks, the third respondent Board shall issue a clarification particularly with reference to the issue raised by the writ petitioner pertaining to applicability of said Circular i.e., Circular No.83/2003 in the post GST regime i.e., post 01.07.2017. Depending on the clarification, the impugned SCN will either get revived and carried to its logical end or dropped obviously post eight weeks. Petition disposed off.
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Insolvency & Bankruptcy
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2019 (7) TMI 219
Admissibility of petition - Initiation of Corporate Insolvency Resolution Process - existence of Debt - HELD THAT:- Applicant is an Operational Creditor within the meaning of sub-section (5) of Section 20 of the Code. From the aforesaid material on record, petitioner is able to establish that there exists debt as well as occurrence of default. The Application filed by the Applicant is complete in all respects. Petition admitted - moratorium declared.
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2019 (7) TMI 218
Liquidation order - Section 33 of the Insolvency Bankruptcy Code, 2016 (I B Code) - rejection of resolution plan - HELD THAT:- In view of the order of liquidation, the Liquidator is now required to act in terms of the decision of this Appellate Tribunal in Y. SHIVRAM PRASAD AND ASSET RECONSTRUCTION COMPANY (INDIA) LTD. VERSUS S. DHANAPAL ORS. AND SERVALAKSHMI PAPER LTD. ORS [ 2019 (5) TMI 386 - NATIONAL COMPANY LAW APPELLATE TRIBUNAL, NEW DELHI] where it was held that As the liquidation so taken up under the I B Code , the arrangement of scheme should be in consonance with the statement and object of the I B Code . Meaning thereby, the scheme must ensure maximisation of the assets of the Corporate Debtor and balance the stakeholders such as, the Financial Creditors , Operational Creditors , Secured Creditors and Unsecured Creditors without any discrimination. Appeal disposed off.
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2019 (7) TMI 217
Permission to withdraw the Corporate Insolvency Resolution Process (CIRP) - Corporate Debtor - HELD THAT:- Regulation 30(A) provides that an application for withdrawal under Section 12A shall be submitted to the interim resolution professional or the resolution professional, as the case may be, in Form FA of the Schedule before the issue of invitation for expression of interest under regulation 36A . The regulation further provides that if the application is approved by the CoC with 90% vote share, the Resolution Professional shall submit the application under sub-regulation (1) to the Adjudicating Authority on behalf of the applicant, within three days of such approval. Further Regulation provides that adjudicating authority may, by order, approve the application submitted under sub-regulation (4). The use of the word may in Sec. 12A of the Code indicates that, if an application is filed under Section 12A, and CoC approves it with 90 per cent voting share, then the Adjudicating Authority may allow the withdrawal application, in such manner as specified. Section 12A of the Code stipulates that the Adjudicating Authority has the discretion to accept or reject the application, filed under Section 12A, provided that application is made by the applicant with the approval of 90% vote share of the CoC - Regulation 30A of CIRP Regulations, 2016 provides the procedure by which application under Section 12A can be filed. Regulation 30A provides that application under Section 12A should be filed in Form FA before issuance of an invitation for expression of interest. Since section 29A of the Code specifically prohibits a wilful defaulter to submit a Resolution Plan. In this case, admittedly promoters of the Corporate Debtor are a wilful defaulter, and therefore. they are not eligible to submit a Resolution Plan as per section 29A. The resolution for withdrawal of CIRP did not obtain the required percentage of voting by the members of CoC, i.e. 90% at the first instance. Subsequently, a CoC meeting was conducted, and a resolution was voted upon for reconsideration of the withdrawal. The RP/CoC has not quoted the exact provision that empowers them to again put for the voting of the resolution which was earlier defeated.
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2019 (7) TMI 216
Admissibility of petition - Initiation of Corporate Insolvency Resolution process against Corporate Debtor - default in making payment with interest - Section 9 of Insolvency Bankruptcy Code read with Rule 6 of Insolvency Bankruptcy (Application to Adjudicating Authority) Rules, 2016 - HELD THAT:- This Bench having been satisfied with the Application filed by the Operational Creditor which is in compliance of provisions of section 8 9 of the Insolvency and Bankruptcy Code admits this Application declaring moratorium - Petition admitted.
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Service Tax
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2019 (7) TMI 215
Refund of service tax paid - construction of residential house - more than 12 units or not - refund claimed as per the exemption provided under S.No.14 of N/N. 25/2012-ST dated 20.06.2012 - refund claim denied on the ground that exemption notification is not applicable in the present case, as the present project consisting of more than 12 Villas, is not a single residential unit - HELD THAT:- In the present case, there is a separate agreement entered between the appellant and the contractor for construction of the individual house for which separate approval has been sanctioned. Further the definition of residential complex is not applicable in the present case because all the conditions which are required to be fulfilled for a complex to be residential complex are not fulfilled in the present case - the ground for rejection is that there are common facilities like park and roads but in view of the Relinquishment Deed produced on record, I find that these common facilities like parks and roads have been relinquished to the Government and hence the same is not the common properties of the owner. It is rather a public property which cannot be considered as common facilities. Appeal allowed - decided in favor of appellant.
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2019 (7) TMI 214
CENVAT Credit - input services - Renting of Immovable Property Service - HELD THAT:- For the purpose of establishing the correlation of the service on which the cenvat credit was availed and the output service provided, the present case remanded back to the original authority to pass a fresh order after considering the documents which may be produced by the appellant in support of their case - appeal allowed by way of remand.
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2019 (7) TMI 213
Utilization of CENVAT Credit - post amendment period - utilization of credit on the services supplied to them during construction of mall for discharging their service tax liability after the constructed mall was rented out, on the maintenance repair services - HELD THAT:- The issue is no longer res integra in view of the decision of Hon ble Andhra Pradesh High Court in the case of Sai Sahmita Storages (P) Ltd. [ 2011 (2) TMI 400 - ANDHRA PRADESH HIGH COURT ] which was subsequently followed by the various other decisions - In all these cases, the issue was identical and it was held by various Tribunals/High Court that in such a situation, the appellant would be entitled for the benefit of Cenvat credit prior to amendment for post amendment period also. The availment of the Cenvat Credit for being utilised for the payment of service tax on provision of output services of Renting of Immovable Property is allowed - appeal allowed - decided in favor of appellant.
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2019 (7) TMI 212
Works Contract Service - Composition Scheme - obtaining of permission from the jurisdictional Officer for discharging the service tax liability under the composition scheme - mandatory requirement or not - HELD THAT:- The said issue is settled in the case of REAL VALUE PROMOTERS PVT. LTD., CEEBROS PROPERTY DEVELOPMENT, PRIME DEVELOPERS VERSUS COMMISSIONER OF GST CENTRAL EXCISE, CHENNAI [ 2018 (9) TMI 1149 - CESTAT CHENNAI] where it was held that The services provided by the appellant in respect of the projects executed by them for the period prior to 1.6.2007 being in the nature of composite works contract cannot be brought within the fold of commercial or industrial construction service or construction of complex service - For the period after 1.6.2007, service tax liability under category of commercial or industrial construction service under Section 65(105)(zzzh) ibid, Construction of Complex Service under Section 65(105)(zzzq) will continue to be attracted only if the activities are in the nature of services simpliciter. Appeal dismissed - decided against appellant.
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2019 (7) TMI 211
Refund of service tax paid - input services - Real Estate Agent Service - Management Consultant Service - HELD THAT:- In the appellant s own case for the previous period in the case of COMMISSIONER OF CENTRAL EXCISE VERSUS M/S. MANGALORE SEZ LTD. [2016 (11) TMI 1103 - CESTAT BANGALORE] , Commissioner (Appeals) has allowed the refund on the ground that approval was obtained subsequently from the Development Commissioner. The impugned order denying the refund of Rs. 1,10,250/- is not sustainable in law - appeal allowed - decided in favor of appellant.
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2019 (7) TMI 210
Recovery of the service tax - Consulting Engineer services - period 1997-98 to 2000-2001 - whether the Appellant during the relevant period i.e. 1997-98 to 2000-01, rendered the services which fall under the category of consulting engineer service as was in force at the relevant point of time? - HELD THAT:- Inasmuch the relevant service agreements with respective customers/clients have not been produced by the Appellant before the Adjudicating authority. Therefore, it is prudent to remand the matter to the Adjudicating authority to analyse the agreements that are now produced before this forum and further copies of the agreements that would be produced during de-novo proceedings. Appeal is allowed by way of remand to the Adjudicating authority.
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2019 (7) TMI 209
Recovery of Service Tax - Business Auxiliary Service - GTA Services - reverse charge mechanism - HELD THAT:- A perusal of the show-cause notice shows that it is the allegation in the show-cause notice that the assessee received goods transport services as a consignee/consignor towards transportation of goods by road by different goods transport agencies and hence the demand. This demand was made based on the annual reports for the year 2004-05, 2005-06, 2006-07, and 2007-08 and statement dated 18.02.2009, ledger copies and debit notes in respect of export commissions and goods transports as well as based on assessment letters along with consignment notes. Appellant now pleads in the grounds of appeal that they have not availed the services of any goods transport agency at all. However, this assertion is not substantiated by any evidence whatsoever in the appeal book. There is no merits in the appeal - appeal dismissed.
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2019 (7) TMI 208
Short payment of service tax - the adjudicating authority rejected the C.A. certificate on the ground that the supporting documents like, ledger, invoice, bills etc. have not been produced - HELD THAT:- Since the appellant had already earlier submitted the detail of profit and loss account, ledge, invoices, bills etc., they had placed the C.A. certificate in support of their claim for reconciliation of the figures between ST-3 returns and the balance-sheet. The authorities below rejected the C.A. certificate on the ground that the supporting documents were not enclosed along with the certificate. There is no justification in the findings of the authorities below inasmuch as all the documents have been submitted by the appellant, the basis on which show-cause notice was issued to the appellant which is evident from the show-cause notice itself - rejection of the C.A. certificate for want of supporting documents, cannot be sustained. Since the appellant is able to reconcile the differential figures between ST-3 returns and the balance-sheet supported by the C.A. certificate - Appeal allowed - decided in favor of appellant.
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2019 (7) TMI 207
Business Auxiliary Services - commission received from M/s. Moneygram for the activity of transfer of money to a person located in India by the appellantassessee on behalf of M/s. Moneygram - HELD THAT:- The said issue has been examined by the larger bench of this Tribunal in the case of M/S PAUL MERCHANTS LIMITED OTHERS VERSUS CCE, CHANDIGARH [ 2012 (12) TMI 424 - CESTAT, DELHI (LB)] , wherein it has been held that the services provided by agent and sub-agents to M/s.Western Union Network Limited are export of services and not liable to service tax - Similar issue is in the case in hand, the appellant-assessee has provided servic es to M/s. Moneygram as the appellant-assessee is transferring the money on the instructions of M/s. Moneygram to their clients in India. Therefore, the said activity falls under export of services, no service tax is payable by the appellant-assessee. Business Auxiliary Service - commission received for arranging air tickets for their customers - HELD THAT:- The said demand cannot be confirmed against the appellant-assessee in the light of the decision of this Tribunal in the case of TRADE WINGS LTD. VERSUS COMMISSIONER OF C. EX. SERVICE TAX, JAIPUR-I [ 2017 (9) TMI 257 - CESTAT NEW DELHI] where it was held that The travelling public is getting only ticket with no identity linking the same to another travel agent. In such situation, it could not be said that the appellant is promoting the business of another travel agent, in their capacity as sub-agent. No such fact has been established in the impugned order by the lower authority - for the said amount of commission received by the appellant-assessee, no service tax is payable. Fee charged for filing passport applications - HELD THAT:- The value of taxable services were less than the exemption limit prescribed under Notification No.6/2005-ST dt.1.3.2005 as their total amount of taxable service falls within the threshold limit, therefore, no service tax is payable by the appellant-assessee - the appellant-assessee is not liable to pay service tax. Appeal allowed - decided in favor of appellant.
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2019 (7) TMI 206
Demand of service tax on Advance - in terms of Section 67(3) of the Finance Act, 1994 - HELD THAT:- The appeal is admitted on substantial questions of law.
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Central Excise
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2019 (7) TMI 205
Condonation of delay in filing appeal - power of Appellate Authority to condone delay - Jurisdiction - HELD THAT:- The contentions raised do not fall within the scope of judicial review as explained. At the highest, the contentions raised may have warranted some examination the exercise of appellate jurisdiction, but not in exercise of powers of judicial review. In this case, the petitioner, delayed the institution of appeal and therefore, cannot expect that the this Court converts itself into an appeal court whilst exercising powers of judicial review under Article 226 of the Constitution of India. The contention as raised would require reevaluation and re-appreciation of factual position. Such an exercise cannot be undertaken in the exercise of limited jurisdiction of judicial review. There is absolutely no explanation for inordinate delay in the institution of the petition - petition dismissed.
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2019 (7) TMI 204
Condonation of delay of 121 days in filing appeal - time limitation - HELD THAT:- The High Court of Telengana and Andhra Pradesh, has in fact, agreed with the Full Bench decision of Gujarat High Court in Panoli Intermediate (India) Pvt. Ltd. [ 2015 (7) TMI 303 - GUJARAT HIGH COURT ] and observed that a writ petition would lie against an order-in- original, against which, an appeal was filed and dismissed as time-barred or no appeal had been preferred, as it would have been time-barred. I would like to emphasize that the view expressed by the above two full bench decisions of the High Courts holding that writ petition would lie against an order-in-original, even though the appeal was dismissed as time-barred, is not a general rule in all cases and on the other hand, it is a qualified one applicable only under certain circumstances. Petition dismissed as not maintainable.
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2019 (7) TMI 203
Condonation of delay in filing appeal - power of Appellate Authority to condone delay - Jurisdiction - HELD THAT:- The contentions raised do not fall within the scope of judicial review as explained. At the highest, the contentions raised may have warranted some examination the exercise of appellate jurisdiction, but not in exercise of powers of judicial review. In this case, the petitioner, delayed the institution of appeal and therefore, cannot expect that the this Court converts itself into an appeal court whilst exercising powers of judicial review under Article 226 of the Constitution of India. The contention as raised would require reevaluation and re-appreciation of factual position. Such an exercise cannot be undertaken in the exercise of limited jurisdiction of judicial review. There is absolutely no explanation for inordinate delay in the institution of the petition - petition dismissed.
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2019 (7) TMI 202
CENVAT Credit - input services - tax paid on commissions to Agents who sell the goods and undertake the guarantee of payment - input service invoices issued by their office as ISD prior to 01.03.2006, when the registered address was different. Tax paid on commissions to Agents who sell the goods and undertake the guarantee of payment - HELD THAT:- A plain reading of the scope of commission agent and the Del Credere Agent, it can be inferred that the Del Credere Agent is the one who guarantees payment from the customer s for the sale and in the event of default in such payment, makes good of the same to the principal - In the present case, besides, the activity of sales promotion, the agents have also undertaken to act as a Del Credere Agent. Therefore, merely because of the fact they were also act as Del Credere Agent, the activities/services provided by such agents in promotion of the sale of the product cannot in any manner be diluted - therefore the activities/services rendered by the agents through the agency agreement reproduced above clearly indicate that the services provided by them are in the nature of sales promotion activities in addition to the service as Del Credere Agent, hence, fall within the scope of definition of input service as prescribed under Rule 2(l) of the Cenvat Credit Rules, 2004 - the amount of service tax paid to these commission agents have been rightly held by the Commissioner is in the nature of sales promotion, accordingly, eligible to cenvat credit - credit allowed. Whether the appellant-assessee has correctly availed cenvat credit on the input service invoices issued by their office as ISD prior to 01.03.2006, when the registered address was different? - HELD THAT:- At the relevant time, their Satellite office was a unit included in the list of units for distribution of credit submitted to the department. However, later, due to shifting of the business operations to Satellite office, change of address in the ISD Registration Certificate was requested and allowed from 1st March 2006 - credit should not be denied merely for procedural irregularities - credit allowed. Appeal allowed - decided in favor of appellant.
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2019 (7) TMI 201
Refund of CENVAT Credit - Rule 5 of the CENVAT Credit Rules, 2004 - period from October 2016 to December 2016 and January 2017 to March 2017 - Room/Laundry Service - HELD THAT:- The issue has been settled in the case of M/S ONE ADVERTISING COMMUNICATION SERVICES LIMITED VERSUS CST AHMEDABAD. [ 2012 (5) TMI 219 - CESTAT, AHMEDABAD] where credit on similar services allowed - appellant is entitled to refund on the service. Insurance and AMC charges - HELD THAT:- The Bangalore Bench of the Tribunal in the case of COMMISSIONER OF CENTRAL EXCISE CUSTOMS, GUNTUR VERSUS CCL PRODUCTS (INDIA) LTD. [ 2009 (3) TMI 136 - CESTAT, BANGALORE] where it was held that these services have been received or rendered only in relation to the manufacture of final products and the credit was allowed - appellant entitled to credit on such services. APR Certification/CA Services - HELD THAT:- The Bangalore Bench of the Tribunal in the case of COMMR. OF C. EX., VISAKHAPATNAM VERSUS ANDHRA PRADESH PAPER MILLS LTD. [ 2010 (2) TMI 532 - CESTAT, BANGALORE] where it was held that credit is allowed on such services - refund allowed. Legal Expenses - HELD THAT:- The Co-ordinate Bench of the Tribunal in the case of COMMISSIONER OF CENTRAL EXCISE VERSUS M/S. HCL TECHNOLOGIES [ 2014 (11) TMI 663 - ALLAHABAD HIGH COURT] where credit on such services allowed - refund allowed on the service. With regard to the other claim of Rs. 2,00,775/- being not considered for refund, I find that there is no finding given by both the lower authorities and therefore, in the interests of justice, this requires fresh adjudication - matter remanded to the file of the Adjudicating Authority who shall pass a de novo order on this issue after considering all the contentions urged by the appellant. Appeal allowed in part and part matter on remand.
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2019 (7) TMI 200
CENVAT Credit - common inputs/input services which are used in the manufacture of dutiable goods and exempted product - recovery of an amount equal to 6% of the clearance value of the exempted goods - HELD THAT:- Hon ble Supreme Court in UNION OF INDIA VERSUS DSCL SUGAR LTD. [ 2015 (10) TMI 566 - SUPREME COURT] , held that Bagasse emerged during the course of manufacture of sugar and molasses as a by-product cannot be subjected to the provisions of Rule 6 of CENVAT Credit Rules, 2004. Appeal allowed - decided in favor of appellant.
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2019 (7) TMI 199
CENVAT Credit - Special CVD (SAD) - credit denied merely on the basis of debit in the pass book - HELD THAT:- Commissioner (Appeals) had taken the wrong view while permitting the availment of Cenvat credit on the basis of mere entry in DEPB book - reliance placed in the case of THE COMMISSIONER OF CENTRAL EXCISE, CUSTOMS SERVICE TAX VERSUS M/S. PRECISION PIPES AND PROFILES CO. LTD. [ 2014 (1) TMI 1474 - ALLAHABAD HIGH COURT] - appeal allowed - decided in favor of appellant.
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2019 (7) TMI 198
Classification of goods - PVC Suction Pipes, PVC Krishi Pipes, PVC Water Hose Pipe, PVC Water Stop, Rubber Hose and Rubber Sheet - whether classified under chapter 3917 or otherwise? - extended period of limitation - HELD THAT:- The products in question are PVC Krishi Pipes of the burst pressure of 1.0 Mpa, PVC suction pipes of burst pressure of 1.5 Mpa and PVC Garden Pipe of 0.7 Mpa. Thus the products have the pressure of much less than 27.6 Mpa as is minimum required under chapter 3917.31. This particular observation is sufficient for us to hold that the product cannot be classified under section 3917.31. Thus, the products being one or the other kind of pipe that have been classified under section 39 in the category of 3917.39. All flexible or non-flexible tubes, pipes and hoses are excisable goods even if they are classified under chapter heading 3917.31 having work pressure of more than 27.6 Mpa and are also excisable and the duty of 16% is to be levied as per Central Excise Act. These observations coupled with the admission of the appellant that the product is classifiable are sufficient for us to hold that except for the burst pressure criteria, any pipe, tube or hose is excisable goods. The burst pressure of appellant s product is admittedly less than 27.6 Mpa as is minimum required to claim exemption. None of the grounds of the appellant assessee as mentioned above affect the said excisability. Resultantly, we do not find any infirmity in the order denying the classification of the impugned goods under 3917.31 and holding it as a product classifiable under 3917.39 i.e. the hollow pipes which do not find any other classification in the said chapter, the demand confirmed is, therefore, sustainable. Extended period of limitation - Penalty - HELD THAT:- Since the appellant is found to have wrongly classified his product to such a category to which no duty is leviable, the goods are otherwise excisable, the act is held as wilful intention to evade the duty - The said act of the appellant is definitely an act of misrepresentation of the facts - adjudicating authority was right to invoke the extended period of limitation and the penalties are also held to have been rightly imposed. Appeal dismissed.
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2019 (7) TMI 197
CENVAT Credit - inputs - CR sheets dies, etc - alleged wrongful description of raw material - Revenue entertained a view that as per description of goods in the invoices, the goods cannot be used in the furnace installed by the appellant for further manufacturing of ingots - penalty - HELD THAT:- The credit sought to be denied to the appellant on the ground that CR coils of small length cannot be the inputs for the appellant to be used in their final products. The only allegation on the basis that the said HR/CR coils can be used by cycle manufacture to manufacture their final products - The said allegation has been made on the basis of assumptions and presumptions. During the course of investigation, both suppliers as well as manufacturer-buyer have stated in their statements that they have supplied the goods, in question to the appellant, who received the goods. There is no evidence placed on record by the Revenue that the goods in question have not been received by the appellant-manufacturer. Merely adding the word rejected scrap in the invoice cannot be the reason to say that the goods were not received by the appellant and there is no such evidence placed on record by the Revenue. The said goods used by the appellant in the manufacture of final products. The Revenue has to prove if the said goods have been diverted or not used by the appellant in the manufacture of their final products then from where the inputs have been procured by the appellant to manufacture final products. There is no statement of transporter to that extent has been brought on record. The Revenue has failed to produce any evidence to show that the inputs in question have not been used by the appellant in the manufacture of their final products. Therefore, the demand is on the basis assumptions and presumptions, hence, cannot be confirmed by denying the credit to the appellants - the benefit of doubt goes in favor of the appellants - Credit allowed - penalty also not imposable. Appeal allowed - decided in favor of appellant.
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2019 (7) TMI 196
CENVAT Credit - illegal availment of CENVAT credit without actual receipt of inputs/raw materials - fake invoices - HELD THAT:- It is a settled principle of rule of evidence that admission needs no further proof (Section 58 of the Indian Evidence Act). Therefore, the only dispute concerning which appellants are before this forum is the duty demand on the balance of raw material that was found to have short fall during physical stock taking done by DGCEI. Appellants attributed the loss to pilferage and mud deposit but simultaneously admitted through the statement of Managing Director that concerning pilferage, no police report was lodged nor any record was produced to substantiate the same. Having regard to Rule 9(5) of the CENVAT Credit Rules, 2004 whereby burden of proof is on the appellants to establish the admissibility of CENVAT credit, there is no convincing ground established by the appellant that would require interference in the order passed by the Commissioner of Central Excise. Appeal dismissed - decided against appellant.
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CST, VAT & Sales Tax
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2019 (7) TMI 195
Form F - Maharashtra VAT Act - inaction on the part of the Respondent No. 1 Deputy Commissioner of Sales Tax in issuing Form F - stock transfer - HELD THAT:- The Respondent No. 1 directed to dispose of the petitioner s representation dated 05th September 2018 as expeditiously as possible and preferably within a period of 12 weeks from today - petition disposed off.
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2019 (7) TMI 194
Rejection of Books of accounts - rejection on the basis of surmises and conjectures - Whether even otherwise the selling rate of coal could have been enhanced by making addition to the freight charges in absence of any material in support thereof? - HELD THAT:- Perusal of the assessment order reveals that the reason for making the enhancement to the freight charges is only one, being non-production of part freight receipts. Even if that reason can be accepted as a reason to make the estimation, the assessment order does not disclose the basis on which the enhancement had been made to the freight charges. Neither there is any exemplar relied upon by the Assessing Authority nor there is any intimation received from the seller or transporter or railways in support of the conclusion reached with respect to suppression of the freight charges - answered in the negative i.e. in favour of the revenue and against the assessee. HELD THAT:- It is vital in the facts of the present case that the entire quantities of coal had been produced by the assessee from a single purchaser from M/S Bharat Coking Coal Ltd., Dhanbad. Some freight receipts had also been produced by the assessee disclosing the freight charges paid to that seller that have not been doubted or disbelieved. The Assessing Authority could not have recorded a subjective satisfaction that there was suppression of freight charges. The same mistake has been committed by the first appellate authority in affirming the findings with respect to suppression of freight charges - The enhancement made on account of freight charges is clearly unsustainable as it is not based on any material or valid consideration. Rather, the same is found to have been made on purely subjective satisfaction devoid of any evidentiary basis - answered in the negative i.e. in favour of the assessee and against the revenue. Revision allowed in part.
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2019 (7) TMI 193
Release of seized goods - ownership of goods could not be proved - Section 34 (2) of the DVAT Act - HELD THAT:- Clearly, the goods cannot be released to the Petitioners unless they prove ownership of such goods. The directions issued by this Court in the judgment dated 12th February 2016 are clear. The DT T was required to get to the bottom of the entire case and unearth the complete facts not only regarding the goods that were seized on 1st March 2014, but also with regard to the modus operandi deployed not only by the Petitioners but also in other similar instances. The Court had noted that this could not have and in fact was not a solitary instance where valuable goods in the form of gold and silver jewellery and even cash were being transported from one State to the other through road and rail without any proper checks either by the DT T or the Police. There was no stay of the proceedings of the Committee at any stage. Irrespective of the deliberate failure of the Petitioners to participate in the verification exercise, it was incumbent upon the Committee constituted by the CTT to have concluded its proceedings and determined whether the documents submitted by the Petitioners were genuine and whether the documents proved their ownership of the seized goods. This exercise could not have gone on endlessly and that too for over three years. As far as the Petitioners objections to the constitution of the Committee by the CTT is concerned, as already noticed hereinbefore, there was no legal basis for the Petitioners to question the constitution of such a committee. The Petitioners not having challenged the judgment dated 12th February 2016 passed by this Court negating their pleas, could not have turned around to question the constitution of the committee - The Court accordingly hereby negatives the objections raised by the Petitioners to the constitution of the Committee by the DT T and directs the Committee to now conclude its proceedings by preparing and releasing its report on the documents submitted by the Petitioners not later than 31st July 2019. Petition disposed off.
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2019 (7) TMI 192
Rejection of books of accounts to make Best Judgement assessment - running of Brick Klin - estimation of firing period - HELD THAT:- In the first place, the conclusion drawn by the authorities as to rejection of books of account cannot be seriously disputed in the present case, as the assessee did not produce the books of account. Though he may have made an application for compounding, however upon rejection of that application for the purpose of making a regular assessment, the books would remain a requirement to be fulfilled by the assessee. In absence of those books, the authorities have not erred in rejecting the same and in consequentially proceeding to make the best judgment assessment. Quantification of the turnover - HELD THAT:- In the first place, some elbow room has to be allowed to the revenue authorities while making estimation and no rule of exact measurement can be enforced against the assessing authority in this regard. In so far as the estimation is based on a valid and relevant consideration, the same does not call for any further or microscopic examination. In the facts of the present case, keeping in mind the admitted facts of the survey dated 06.05.2001 wherein the substantial amount of under production bricks and coal were found existing and also it was noted that the brick kiln was running, it is difficult to accept the submission advanced on behalf of the assessee that the brick kiln would have stopped running on 10 May, 2001, keeping in mind the general tendency of the industry - the estimation of the firing period made by the Tribunal is found to be based on relevant consideration - the same cannot be faulted. Revision dismissed.
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Indian Laws
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2019 (7) TMI 191
Maintainability of suit - Order 7 Rule 11(d) of the Civil Procedure Code - HELD THAT:- The appellant(s) cannot claim any right merely on the basis of a self serving allotment letter pertaining to the concerned flat, purportedly given by the builder. Noticeably, contends learned counsel for respondent No.1 that the averments in the plaint(s) regarding allegation of fraud played upon the appellant(s) are vague and general. The same are baseless and unsubstantiated. We do not deem it necessary to elaborate on all other arguments as we are inclined to accept the objection of the appellant(s) that the relief of rejection of plaint in exercise of powers under Order 7 Rule 11(d) of CPC cannot be pursued only in respect of one of the defendant(s). In other words, the plaint has to be rejected as a whole or not at all, in exercise of power Order 7 Rule 11 (d) of CPC. Indubitably, the plaint can and must be rejected in exercise of powers under Order 7 Rule 11(d) of CPC on account of noncompliance of mandatory requirements or being replete with any institutional deficiency at the time of presentation of the plaint, ascribable to clauses (a) to (f) of Rule 11 of Order 7 of CPC. In other words, the plaint as presented must proceed as a whole or can be rejected as a whole but not in part. In that sense, the relief claimed by respondent No.1 in the notice of motion(s) which commended to the High Court, is clearly a jurisdictional error. The fact that one or some of the reliefs claimed against respondent No.1 in the concerned suit is barred by Section 34 of 2002 Act or otherwise, such objection can be raised by invoking other remedies including under Order 6 Rule 16 of CPC at the appropriate stage. These appeals must succeed on the sole ground that the principal relief claimed in the notice of motion filed by respondent No.1 to reject the plaint only qua the said respondent and which commended to the High Court, is replete with jurisdictional error - appeal allowed.
9911796707
