• +91-9582224324
  • jatin@cajatinminocha.com

Our updates 2021

Yes bank will provide 'curated offerings to address both business and individual needs of MSMEs'
YES BizConnect – a collaborative solutions to build strong market linkages involving over 700 industry associations will also be offered. 
To strengthen the Micro, Small and Medium Enterprises (MSMEs), YES BANK has recently launched YES MSME — an initiative that will facilitate "speedy and easy access to funds" to MSME sector. The bank will provide "curated offerings to address both business and individual needs of MSMEs, nurture new age entrepreneurs and maximise their potential," the lender said in a statement.
"The YES MSME proposition focuses on supporting MSMEs in expanding their business, sustaining momentum and accelerating growth through solutions across lending, deposits, insurance, customized and segmented digital solutions for retail, manufacturing, wholesale, trade and service providers. This also includes special current account offerings for the self-employed segment," the lender said.
The start-ups can avail up to ?5 crore collateral-free funding under YES MSME initiative. The bank also aimed to reduce the turnaround time for processing MSME loans. The lender will also offer other features include pre-approved commercial credit cards, advisory and wealth management solutions along with dedicated relationship managers.

Gst tracking application to be effective.....
Read More 

Penalty in case of fake bills: 
1. Finance Act 2020 introduced a penalty provision to curb malpractices of issuing fake invoice. It introduced Section 271AAD w.e.f 1st April, 2020. 
2. Quantum of Penalty; a sum equal to aggregate of amount of false entries or omitted entries. 
3. This section start with “without prejudice to any other provision…”, hence penalty under this section shall be in addition to any other penalty under the Income-tax Act.
4. Power to levy penalty is with assessing officer.
5. The assessee must be required to maintain books of accounts. In case books of accounts are not required to be maintained by the assessee, this penalty would not be applicable. 
6. Sec 270A provides a penalty of 200% of tax evaded in the case of misreporting of income. 
7. So if a company accepts fake invoice of Rs 50 Lakhs without actual supply of goods or services and shows the same as his purchases or expenses and claims income tax benefit on the same, the amount of penalty shall be U/S 271 AAD of Rs 50 Lakhs PLUS 200% of tax evaded U/S 270A of Rs 30 Lakhs (assuming tax of 30%) ie Rs 80 Lakhs (more than the value of the fake invoice) 

When can we opt-in for QRMP Scheme?
Normally we can opt-in to the scheme in every quarter as per the following dates:
 *Quarter*  Between
Apr-Jun:-     1st Feb-30th Apr
Jul-Sept:-     1st May-31st Jul
Oct-Dec:-    1st Aug-31st Oct
Jan-Mar:-     1st Nov-31st Jan

•For Jan-March 2021 Quarter you can opt- in to the scheme up to 31st January 2021.
Remember once opted-in, the same will continue for all quarters, unless you opt- out.

• For an uninterrupted and continuous supply of essential goods and services, The Central Board of Indirect Taxes and Customs extends the facility of deferred duty payment to the public undertakings.

New SC ruling on IBC: 
1. The moot question for potential buyers of bankrupt companies has been why should a new owner bear the brunt of cases pertaining to old promoters?
2. On January 19, the Honourable Supreme Court has finally answered this question by upholding Section 32A of the Insolvency and Bankruptcy Code (IBC), granting statutory immunity to successful resolution applicant from prosecution.
3. Essentially, the court’s ruling says that new owners will not face legal troubles or probes linked to the old cases faced by previous promoters.
4. This ruling could be a relief for companies like Bhushan Steel where promoters are facing legal issues and probe. 

• MCA announces a new scheme for condonation of delay for companies restored on the Registrar of Companies between the 01.12.20 - 31.12.20.
• The Scheme provides to condone delay in filing forms with the Registrar, and spares payment of additional fees. 
• This Scheme will be in operation from 01.02.21 and will be available for filing of any overdue e-forms by such companies till 31.03.21.
• The scheme is applicable for filing of all e-forms except for the following forms: 
1. E-form SH-7 (where any increase in authorised share capital is involved) 
2. CHG-1, CHG-4, CHG-8 and CHG-9 (Charge Related Documents).

Faceless Penalty Scheme: 
1. Finance Act 2020 has inserted an enabling provision in the form of a new sub-section (2A) in section 274 of the Act so as to provide that the Central Government may notify a e-scheme for the purposes of imposing penalty. 
2. Notf no 117(E)  dated 12th Jan 2021 has been issued for the purposes of giving effect to the Faceless Penalty Scheme, 2021. 
3. Faceless penalty means the penalty proceedings conducted electronically in ‘e-proceeding’ facility through assessee’s registered account in the designated portal. 
4. The CBDT would set up the below ‘centres’ and ‘units’ and specify their respective jurisdiction:
* A ‘National e-Penalty Centre’ to facilitate and centrally control the e-penalty proceedings. 
* ‘Regional e-Penalty Centres’ under the jurisdiction of the regional Principal Chief Commissioner.
* ‘Penalty units’ for identifying points or issues, material for the determination of any liability, analysing information, and such other functions.
* ‘Review units’ for reviewing the draft assessment order to check whether the facts, relevant evidence and law and judicial decisions have been considered in the draft order.
5. All the correspondences between all these centres/units and also with the assessee shall be by electronic mode only. 
6. The Chief Commissioner or the Director General, in charge of the Regional Faceless Penalty Centre (RFPC), under which the concerned penalty unit is set up, may approve the request for personal hearing (through video conference). However the circumstances under which personal hearing would be approved is not yet notified by CBDT. 

Note: A writ petition has been filed in the Delhi High Court, regarding a lack of suitable opportunity of being heard in the new faceless regime and thus resulting into a violation of Article 14 of the constitution. (Lakshya Buddhiraja)

CBIC issued clarification regarding requirement of Filing of bill of Coastal Goods:
• Representations have been received that at various ports like Cochin, VoCPT (Tuticorin), Paradip, Haldia and Kolkata, Bill of Coastal Goods (BCG) is still required to be filed for pure coastal vessels operating from EXIM berths whereas, in terms of Notification 57/2016-Cus (N.T.), dated 27.04.2016, only a Manifest is required to be submitted for pure coastal vessels operating from exim berths.
• CBIC reiterated that there is no requirement of filing a Bill of coastal Goods as was clarified as per para 4(a) of the CBIC Circular no. 14/2016-Cus, dated 27.04.2016 consequent to issue of CBIC Notification no. 56/2016(NT) dated 27.04.2016, if the coastal vessels are carrying exclusively coastal goods whether berthing at coastal berth or EXIM berth.

Ministry of Finance has issued a Press Release dated January 18, 2021 regarding One held by CGST Delhi East officials for availing fake input tax credit of Rs 82.23 crore

•MCA announced Number of Companies Incorporated in December 2020 goes up by 20%. As against 93758 companies incorporated during April- December 2019, this year for the same period, 113038 companies have been incorporated.

CBDT clarifies the amount of remuneration prescribed under section 9A(3)(m) of the Income-tax Act, 1961
• Section 9A of the Income-tax Act, 1961 w.e.f. 01.04.2019 provides for payment of remuneration by an eligible investment fund to an eligible fund manager in respect of fund management activity undertaken by him on its behalf to be not less than the amount calculated in such manner as may be prescribed.
• In this regard, representations have been received expressing inability to comply with the provisions of sub-rule 12 of rule 10V of the Rules regarding the amount of remuneration to be paid by the fund to a fund manager for the financial year 19-20 as the said Notification No 29/2020 was notified after the financial year got over and the financial year 20-21 had already commenced. 
• In order to avoid genuine hardship in such cases, the Board, in exercise of powers conferred under section 119 of the Act, has decided to provide that for the financial years 19-20 and 20-21 in cases where the remuneration paid to the fund manager is lower than the amount of remuneration prescribed under sub-rule (12) of rule 10V of the Rules, but is at arm's length, it shall be sufficient compliance to clause (m) of sub-section (3) of section 9A of the Act.

•MCA has announced that the CFSS 2020 Form shall be made available for filing as eForm w.e.f 16.01.21. (Companies Fresh Start Scheme, 2020 is a scheme which will give a chance to enable companies to make good of any filing-related defaults, irrespective of the duration of default, and make a fresh start as a fully compliant entity)
You may file the following forms in case where you have defaulted earlier in filing the form, which otherwise required to be filed with an additional fees:
•Form AOC 4 (Financial Statements)
•MGT 7 (Annual returns)
•other forms like MGT 14, PAS 3, ADT 1 etc.

Clarification on spending funds for Awareness and public outreach on COVID-19 Vaccination programme
In continuation to this Ministry's General Circular No. 10/2020 dated 23.03.2020 wherein it was clarified that spending of CSR funds for COVID-19 is an eligible CSR activity , it is further clarified that spending of CSR funds for carrying out awareness campaigns/programmes or public outreach campaigns on COVID-19 Vaccination programme is an eligible CSR activity under item no. (i),(ii) and (xii) of Schedule VII of the Companies Act, 2013 relating to promotion of health care, including preventive health care and sanitization, promoting education, and, disaster management respectively.

The Department of Revenue, Ministry of Finance has released the Customs Authority for Advance Rulings Regulations, 2021:
Powers of Authority:- 
• The Authority shall have the power to hear and determine all applications and petitions.
• The Authority may, if any difficulty arises in giving effect to its order or advance ruling, either suo moto or on a petition made by the applicant or the Principal Commissioner or Commissioner, within a period of one month of noticing the difficulty, by appropriate order remove such difficulty, and pass such other order as it considers just and necessary in the circumstances of the case.
• The Authority may reopen the hearing of any case, before pronouncement of its order or advance ruling, for sufficient cause.
• The Authority may, in an appropriate case, direct -
(i) examination of any records and submission of report;
(ii) conduct of any technical, scientific or market enquiry of any goods or services and submission of report and may also call for reports from experts and order such further investigation as may be necessary for effectual disposal of the application.

GST: Hearing a case related to the Central Goods and Service Tax act the Gujrat high court asked the union government to take steps to stop provisionally attaching bank account of person after the GST departments raids over suspected tax evasion or other irregularities.

Income Tax 10% price-stamp duty variance relief u/s 50C on flat sale applies retrospectively from FY 02-03. ITAT Mumbai in case of ITD & Maria Fernandes Cheryl. 

MCA : Amount spent on awareness campaigns/public outreach campaigns etc on Covid-19 vaccination is eligible CSR activity. MCA General Circular No. 01/2021 of 13.1.21.

Income Tax Registration of Trust cannot be cancelled for non-filing of I.T. return due to misdeeds of ex-president. Case Name : Wholesale Cloth Merchant Association Vs PCIT (ITAT Jaipur)
ITAT Chennai in the case of DCIT Vs Avigna Housing Pvt. Ltd. Has decided that we are of the considered view that fair market value of shares considered by the assessee under DCF method is one of the accepted method of valuation of shares under Rule 11UA and such value of shares is supported by necessary supporting evidences including valuation report as on the date of issue of shares.

Income Tax special unit has been created by the government in the countrywide investigation wings of the Income Tax department for focussed probe in cases of undisclosed assets held by Indians abroad and possession of black money in foreign shores. The Foreign Asset Investigation Units (FAIUs) have been recently created in all the 14 investigation directorates.
Reserve Bank of India announced its intention to “restore normal liquidity management operations in a phased manner.” It announced the resumption of variable rate reverse repo auctions, the first of which will be held on January 15, for an amount of Rs 2 trillion, and a tenor of 14 days.

Banks’ gross non-performing assets may rise to 13.5 per cent by September 2021, from 7.5per cent in September 2020 under the baseline scenario, according to Financial Stability Report (FSR) released by the Reserve Bank of India. If the macroeconomic environment worsens into a severe stress scenario, the GNPA ratio may escalate to 14.8 per cent. 
GST:  Proper Officer can possess Confiscated Goods if taxpayer opts not to pay tax payable, penalty & other charges. Case Name : M.S. Meghdoot Logistics Vs Commercial Tax Officer (Karnataka High Court)

GST data in GSTR-1 is now available on T+3 day basis, i.e. for example, the data from e-invoices uploaded on 18-12-2020 would be visible in GSTR-1 on 21-12-2020. The corresponding reflection of such e-invoice details in GSTR-2A/2B/4A/6A has also started.

SEBI proposed to ease ownership norms for entities that plan to start new stock exchanges in India, a move that may end the 16-year-long dominance of the National Stock Exchange (NSE), allow entry of foreign exchanges and lower the trading costs for investors. Currently, NSE, BSE and Metropolitan Stock Exchange are the three nationwide bourses in India, with NSE being the largest in terms of trade volumes both in cash and derivatives segments.

Supreme court of india had issued a circular no. F.No.01/Judl./2020 on March 05, 2020 regarding use of A4 size paper instead of green color legal size paper.

Vietnam and China outperform India in terms of exports:
1. Comparison of India’s exports to US with that of China and Vietnam between January and November 2020:
a. India’s shipment to the US shrank 13.3% on year to $46.3 billion. 
b. China’s dropped by only 5.8% to $393.6 billion despite a trade war and growing criticism of Beijing’s mishandling of the Coronavirus outbreak. 
c. Vietnam’s exports to the US, in fact, rose by as much as 20% to $72.7 billion. 

2. Similarly for European Union (EU):
a. India’s exports to the EU (excluding the UK) witnessed a steep 17.2% decline to 30.6 billion euros. 
b. China’s shipment to the EU rose by 4.3% to 350 billion euros during this period. 
c. Vietnam’s fell only marginally by 0.5% to 31.9 billion euros.

3. India’s exports shrank 17.84 per cent during the seven month period between April and November this year,  triggering serious concerns as exports from most Asian countries have in contrast to India been rising.

4. The government is hoping that the new Remission of Duties or Taxes on Export Products Scheme (RoDTEP) will remedy the situation.
Source: census.gov and ec.europa.eu 

The Narendra Modi government has given a big bonanza to around six crore EPF subscribers who have been eagerly waiting for the crediting of interest for 2019-20 in their employees' provident fund (EPF) accounts.
Labour and Employment minister Santosh Gangwar, announcing the decision on Thursday (December 31) had said that PF subscribers will start receivig 8.5 percent interest on their PF amount from December 31 onwards.

All CGHS Circulars issued during calendar year 2020.... Password is CIR@2020
Read More 

The Supreme Court on Friday held that all summons and notices are allowed to be served through digital medium, including email, fax and instant messaging mobile applications. The decision comes in the wake of a visit to a post office not entirely possible due to the coronavirus pandemic.
In a first, the order passed by a three-judge apex court bench headed by Chief Justice S.A. Bobde held that all methods are to be employed to provide a valid service to a party and it shall include service through messenger services like WhatsApp and other telephone messenger services.

Gist of Gst, Direct Tax, Company Law, RBI, SEBI law amendments of December 2020....
Read More 

Remission of Duties and taxes Scheme to boost exports......
Read More 

Benchmarking in the case of ECBs:
In the case of GE India Technology (ITA 282/2013), Hon Karnataka HC examined this issue. 
Karnataka HC had to decide on whether RBI approved rates for ECBc could be used as a benchmark for Transfer pricing Study?
The Hon HC held that RBI approved rates are a 'relevant factor' for determining benchmarks.

Sharp rise in currency in circulation:
According to data released by the RBI, currency in circulation grew by Rs 5,01,405 crore between January 1, 2019, and January 1, 2020. 
Overall, it has gone up to Rs 27,70,315 crore, up 22% from the previous year.
The average growth for the last decade was 12.6% and for the last 50 years 13.8%.

Unclaimed deposits of ?18,000 crore:
1. Close to ?18,000 crore of unclaimed deposits were lying with banks in calendar year 2019, up from ?14,307 crore in 2018, showed the data released by the Reserve Bank of India (RBI).
2. Deposits are classified as unclaimed when they are not operated for 10 years or more.
3. Unclaimed deposits at public sector banks stood at ?14,971 cr in 2019, it was ?2,472 cr at private banks. 
4. RBI has framed the Depositor Education and Awareness Fund (DEAF) Scheme, 2014 under which banks calculate the cumulative balances in all accounts which are not operated upon for a period of 10 years or more (or any amount remaining unclaimed for 10 years or more) along with interest accrued and transfer such amounts to the DEAF.
5. In order to claim the deposits which are transferred to DEAF, an unclaimed deposits claim form has to be submitted with the requisite KYC. 

Auto-population of e-invoice details into GSTR-1/2A/2B/4A/6A
1. Certain notified taxpayers have been issuing invoices after obtaining Invoice Reference Number (IRN) from Invoice Registration Portal (IRP) (commonly referred as ‘e-invoices’). Details from such e-invoices shall be auto-populated in respective tables of GSTR-1. Update on the status of such auto-population was last published on 30/11/2020.
2. For those taxpayers who had started e-invoicing from 1-10-2020, the auto-population of e-invoice data into GSTR-1 (of December 2020) had started from December 3rd, 2020
3. In this regard, following is to be noted by those taxpayers:
 ??The data in GSTR-1 is now available on T+3 day basis, i.e. for example, the data from e-invoices uploaded on 18-12-2020 would be visible in GSTR-1 on 21-12- 2020.
??The corresponding reflection of such e-invoice details in GSTR-2A/2B/4A/6A has also started.
??The auto-population of e-invoice data into GSTR-1 is based on date of document (as reported to IRP).
For example, a document dated December, 30th, 2020 is reported to IRP on 3rd January, 2021 and where GSTR-1 for December, 2020 is not filed, then the details of that document will be available in the tables of GSTR-1 pertaining to December, 2020.
However, if the GSTR-1 for December was already filed by that date, then, the details of such document will be made available in the consolidated excel file downloadable from GS TR-1 dashboard (with error description as ‘Return already filed’). The taxpayer may thereupon take necessary action.
4. Owing to existing validations in GSTR-1, e-invoices reported with below commonly observed issues are not auto-populated in the tables of GSTR-1 but are made available in the consolidated excel file downloadable from GSTR-1 dashboard (with corresponding error description):
??Supplier is found to be of type ISD/NRTP/TCS/TDS;
??Supplier is found to be composition taxpayer for that tax period;
??Document date is prior to Supplier’s/Recipient’s effective date of registration;
??Document date is after Supplier’s/Recipient’s effective date of cancellation of
?? Invoices reported as attracting “IGST on Intra-state supply” but without reverse charge
5. Further, in certain cases, e-invoice details could not be processed (and hence were not auto-populated) due to data structure issues. These errors may be taken note of and shall be avoided while reporting the data to IRP.
??Serial number of item shall not be reported as ‘0’
??White space found in POS (Place of Supply State Code), e.g. “8 ” . Expected values were 08 and 8.
6. The detailed advisory with methodology of auto-population etc. is already made available on the GSTR-1 dashboard (‘e-invoice advisory’) and also e-mailed to relevant taxpayers.
7. It is once again reiterated that the auto-population of details from e-invoices into GSTR-1 is only a facility for the taxpayers. After viewing the auto-populated data, the taxpayer shall verify the propriety and accuracy of the amounts and all other data in each field, especially from the perspective of GSTR-1 and file the same, in the light of relevant legal provisions.
8. The taxpayers are once again requested to verify the documents auto-populated in GSTR-1 tables and consolidated excel and may share feedback on GST Self Service Portal, on below aspects:
??All documents reported to IRP are present in excel
??Status of each e-invoice/IRN is correct
 ??All the details of document are populated correctly

Income Tax conducts search in Kolkata:
The Income Tax Department carried out search and seizure action on two Kolkata based Groups engaged in manufacturing & trading of Steel, trading of marbles & stones, food grains etc.
The search action has resulted in unearthing of incriminating evidences revealing various shell entities being used for raising bogus share capital/unsecured loans, discrepancies in stock and out of the books cash transactions.
A total concealment of income amounting to Rs. 178 crore has been detected so far including excess stock of Rs. 38 crore.

Record Dec FPI inflows: 
1. Foreign portfolio investors (FPI) remained net buyers for the third month in a row by investing Rs 68,558 crore in Indian markets as global investors continued betting on emerging markets.
2. The overseas investors put in a net Rs 62,016 crore into equities and Rs 6,542 crore into the debt in December 2020.
3. The year 2020 also recorded the highest-ever yearly net inflow of FPIs into equities at over Rs 1.70 lakh crore.
4. In 2020, the Indian stock market witnessed net selling by FPIs during three months — March, April and September. March was the worst month in terms of FPIs, with the highest net outflow during the year pegged at Rs 61,973 crore.
5. Calendar 2019 witnessed total inflows of Rs 1,01,122 crore while Calendar 2018 saw FPI outflows of Rs 33,014 crore. Net inflows for last two years stood at Rs 68,108 crore.
Source: FPI data by NSDL

EPF interest for 19-20: 
1. The Labour Ministry has notified the interest rate of Employees Provident Fund as 8.5% for FY 19-20, after receiving the concurrence of the finance ministry. 
2. 8.5% would comprise of 8.15% earned in the debt market and 0.35% through the sale of exchange traded funds, provided they are redeemed by 31st Dec, 2020.

50948 Times Visited