PROFESSIONAL UPDATES FOR THE 3rd WEEK OF JULY 2014, BY RAJPUT CONSULTANCY SERVICES PVT LTD TEAM,

COMPANIES ACT, 2013:                                                                       

• MCA issued clarifications with regard to provisions of Corporate Social Responsibility under section 135 of the Companies Act, 2013 [General Circular No. 21/2014, Dated: 18th June, 2014].
• Unlisted Companies (including private companies) with paid up share capital of 5 cores or more and all listed companies to have full time Company Secretary[MCA Notification of 09-06-2014].
• Ministry of Corporate Affairs issued Notification No. G.S.R 386 (E) dated 06-06-2014 pertaining to Companies (Acceptance of deposits) Amendment Rules, 2014. The same is available at  http://www.mca.gov.in/Ministry/pdf/Acceptance_of_ Deposits_Amendment.pdf.
• Due to practical problems, voting through electronic means optional till 31-12-2014. Clarifications on issues in e-voting procedure [MCA Circular 20 of 17-06-2014].
• Clarification on Share Transfer Forms executed before 01.04.2014 and delegation of powers by board under rule 6(2)(a) General Circular No. 19/2014- dated 12^th June, 2014, MCA.
• Clarification on rules relating to appointment and qualification of Independent Directors [MCA General Circular 14/2014 of 09-06-2014.
• Annual return on foreign liabilities and assets reporting by Indian Companies – Revised format issued by RBI/2013-14/646 A.P. (DIR Series) [Circular No. 145 dated June 18, 2014].

DIRECT TAX:

• Company and an assessee being individual or HUF is liable to audit u/s 44 AB are required to furnish FORM BB (Return of Net Wealth) electronically under digital signature for assessment year 2014-15 and onwards. Notification No. 32/2014 dated 23/06/2014
• SC: Dismisses Revenue's SLP; “Precaution” can't be equated to “concealment” u/s 271(1)(c), held HC (Durr India Pvt. Ltd.)
• CBDT has released ITR-5 which is applicable for Income Tax Return (ITR) of firms, AOPs, BOIs and LLPs for A.Y. 2014-2015. CBDT has released Java utility of ITR-5 and we expect Excel utility also to be released soon.
• S. 50/ 112: Though gains on depreciable assets held for more than 3 years have to be treated as STCG u/s 50, the gains have to be taxed at the rate applicable to a LTCG. Smita Conductors Ltd vs. DCIT (ITAT Mumbai)
• S. 254(2): Pendency of an appeal filed in the High Court u/s 260A bars the hearing of a MA filed u/s 254(2) even if the appeal is not admitted RW Promotions Pvt. Ltd vs. ACIT (ITAT Mumbai)
• Bar in S. 269SS/ 269T does not apply to loans/ advances accepted/ repaid via journal entries. Limitation period for S. 271D penalty is as per S. 275(1)(c) & not 275(1)(a)  CIT vs. WorldWide Township Projects Ltd (Delhi High Court)
• ITAT : Sec. 37(1) Explanation inapplicable for procedural provision breach, absent unlawfulness in payment 'purpose'  Jai Surgicals Ltd.
•  The provisions of section 269SS of the Income Tax Act does not gets attracted where the amount is transferred to a loan account in the form of book entry [CIT vs. Worldwide Township Projects Ltd., High Court of Delhi]
• ITAT : No TDS on member interest payments by co-operative society ‘carrying banking business’   Bagalkot District Central Co-operative Bank
• CBDT Press Release dated 04th July, 2014: One mobile number or email ID can now be used for 10 Income Tax Accounts.
• ITAT : Landlord services to tenant 'optional', payment not rental but business income Green Valley Agro Mills Ltd.

INDIRECT TAX:

• CX - Duty demanded on Cigarettes at higher rates by retro application of FA, 2012 - Provisional Collection of Taxes Act does not provide for recovery of any dues when rates are amended upwards subsequent to introduction of bill - Stay granted: CESTAT Mumbai, July 04
• CENVAT - Appellant taking credit on inputs purchased by job workers without receiving goods in premises was provided by erstwhile CER, 1944 - similar provision is implied from rule 4(5)(a) in as much as if final products are allowed from job worker's premises it implies job worker could procure part of inputs needed for manufacturing: CESTAT Mumbai, July 04
• Haryana VAT – WCT Rate increased to five percent
• CBEC issued rate of exchange of conversion of each of the foreign currency with effect from the 4th July, 2014 vide Notification 49/2014-Cus(NT), dated 03-07-2014
• Cenvat Credit : Management Consultancy Services availed by an assessee for merger of a company into it are eligible for input service credit (Mumbai - CESTAT)
• Cus - Purchase order & invoice were available at time of filing BoE, therefore, as per CBEC Manual, amendment in BoE is required to be allowed although goods have been given out of charge - appeal is allowed: CESTAT Mumbai, July 01
• UP VAT- CS, CMA included in definition of Accountant & allowed to do VAT Audit by amending Rule 2(e) vide Uttar Pradesh Value Added Tax (Fifth Amendments) Rules 2014
• CENVAT - Credit taken on extra copy of invoice, Xerox is inadmissible as per rule 9 - in order to claim benefit, substantial compliance is not enough & procedures prescribed in statute should be mandatorily followed: CESTATMumbai, July 01
• Haryana WCT rate increased from 4% to 5% w.e.f. 20-06-2014 [Notification number S.O. 67/HI.A.6/203/S.24/2014 of 20-06-2014].
• CX - Duty demanded on Cigarettes at higher rates by retro application of FA, 2012 - Provisional Collection of Taxes Act does not provide for recovery of any dues when rates are amended upwards subsequent to introduction of bill - Stay granted: CESTAT (Mumbai, July 04)
• Cus - Purchase order & invoice were available at time of filing BoE, therefore, as per CBEC Manual, amendment in BoE is required to be allowed although goods have been given out of charge - appeal is allowed: CESTAT Mumbai, July 01
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