The document discusses changes made by the Central Board of Direct Taxes to Form 3CD, which is used for tax audit reports. Key changes include the addition of GST registration numbers under indirect tax laws (Clause 4) and the addition of new reporting requirements for deductions claimed under Section 32AD and deemed profits/gains from Section 32AD (Clauses 19 and 24). New Clauses 29A and 29B were also added related to reporting income from forfeiture of advances for capital asset transfers and deemed gifts under Section 56(2)(x). Guidance is provided on implementation of the new and modified clauses.
OBJECTIVE
Goods and Services Tax (GST) is an Indirect Tax levied in India introduced in July, 2017 which was one of the most important reforms in the Indian Economy. Unlike erstwhile indirect tax regime, GST promises seamless credit on goods and services across the entire supply chain with some exceptions. In this webinar, we shall understand and analyse the provisions related to Input Tax Credit under the GST law
Reconciliation Statement and Certification under GST - Form GSTR 9CDVSResearchFoundatio
OBJECTIVE
Goods and Services Tax (GST) is an Indirect Tax levied in India introduced in July 2017 which was one of the most important reforms in the Indian Economy. There are various periodic compliance requirements and filings under GST. Under the Act, certain registered persons are required to carry out GST Audit and in such cases a reconciliation statement in Form GSTR 9C has to be filed. In this webinar, we shall analyse and understand the said form under the Act.
Critical compliance under GST to be taken care of before 30 September 2018Nilesh Mahajan
GST has completed its first financial year (July 17 – Mar 18) and there are certain critical issues to be considered by the taxpayers on or before 30 September 2018. Certain critical areas requiring urgent attention is captured in the article
All about GST Department's Audit under section 65 of CGST ActCA PRADEEP GOYAL
Directorate General of Audit Indirect Taxes is all set for departmental GST audits & has released strategy pertaining to the audit of GST Taxpayers commence from July 1, 2019 vide letter no F. No. 381/49/2019 dated June 25, 2019, in respect of those taxpayers who have filed their Annual Return in GSTR Form 9 / 9A.
This presentation contains all about departmental audit as stated above covering relevant provisions of GST Acts, Rules, Forms and Instructions with department’s plan in this regard.
Procedures to claim refund, rebate and duty drawback under customsDVSResearchFoundatio
OBJECTIVE
Import of all kinds of goods and on the export of goods on certain situations attracts customs duty. The Customs Act,1962 contains provisions which govern the levy of customs duty. In this webinar, we shall understand the procedures to be followed while claiming refunds, rebate and duty drawback under customs law.
Article is about when to apply GST Refund when goods or services are exported out of India. Legal provisions for process of GST refund scheme. GST is a destination based consumption tax where in the levy of tax moves along with goods and /or services.where a goods exporter is not in position to utilize the GST paid in inputs such as raw material , inputs etc. which are used for export of goods shall apply for refund of GST paid by goods exporter. By taking GST Refund Exporter of Goods can increase its business working capital.
OBJECTIVE
Goods and Services Tax (GST) is an Indirect Tax levied in India introduced in July, 2017 which was one of the most important reforms in the Indian Economy. Unlike erstwhile indirect tax regime, GST promises seamless credit on goods and services across the entire supply chain with some exceptions. In this webinar, we shall understand and analyse the provisions related to Input Tax Credit under the GST law
Reconciliation Statement and Certification under GST - Form GSTR 9CDVSResearchFoundatio
OBJECTIVE
Goods and Services Tax (GST) is an Indirect Tax levied in India introduced in July 2017 which was one of the most important reforms in the Indian Economy. There are various periodic compliance requirements and filings under GST. Under the Act, certain registered persons are required to carry out GST Audit and in such cases a reconciliation statement in Form GSTR 9C has to be filed. In this webinar, we shall analyse and understand the said form under the Act.
Critical compliance under GST to be taken care of before 30 September 2018Nilesh Mahajan
GST has completed its first financial year (July 17 – Mar 18) and there are certain critical issues to be considered by the taxpayers on or before 30 September 2018. Certain critical areas requiring urgent attention is captured in the article
All about GST Department's Audit under section 65 of CGST ActCA PRADEEP GOYAL
Directorate General of Audit Indirect Taxes is all set for departmental GST audits & has released strategy pertaining to the audit of GST Taxpayers commence from July 1, 2019 vide letter no F. No. 381/49/2019 dated June 25, 2019, in respect of those taxpayers who have filed their Annual Return in GSTR Form 9 / 9A.
This presentation contains all about departmental audit as stated above covering relevant provisions of GST Acts, Rules, Forms and Instructions with department’s plan in this regard.
Procedures to claim refund, rebate and duty drawback under customsDVSResearchFoundatio
OBJECTIVE
Import of all kinds of goods and on the export of goods on certain situations attracts customs duty. The Customs Act,1962 contains provisions which govern the levy of customs duty. In this webinar, we shall understand the procedures to be followed while claiming refunds, rebate and duty drawback under customs law.
Article is about when to apply GST Refund when goods or services are exported out of India. Legal provisions for process of GST refund scheme. GST is a destination based consumption tax where in the levy of tax moves along with goods and /or services.where a goods exporter is not in position to utilize the GST paid in inputs such as raw material , inputs etc. which are used for export of goods shall apply for refund of GST paid by goods exporter. By taking GST Refund Exporter of Goods can increase its business working capital.
Budget 2017 - Clause by clause analysis of amendments to direct tax laws (Par...D Murali ☆
Budget 2017 - Clause by clause analysis of amendments to direct tax laws (Part 3) - V. K. Subramani - Article published in Business Advisor, dated March 10, 2017 - http://www.magzter.com/IN/Shrinikethan/Business-Advisor/Business/
Budget 2017: Clause by clause analysis of amendments to direct tax laws - V. ...D Murali ☆
Budget 2017: Clause by clause analysis of amendments to direct tax laws - V. K. Subramani - Article published in Business Advisor, dated February 10, 2017 - http://www.magzter.com/IN/Shrinikethan/Business-Advisor/Business/
Analysis of Finance Act, 2020 vis-à-vis GST
The Finance Act, 2020 has made several amendments to the CGST Act, 2017 and corresponding amendments to the IGST Act, 2017 and UTGST Act, 2017. We have attempted to analyse the provision wise amendment made by the Finance Act, 2020 to the CGST Act, 2017.
Taxmann's GST Tariff with GST Rate Reckoner (Set of 2 Volumes)Taxmann
Taxmann’s GST Tariff contains GST Tariff for Goods and Services. It provides HSN-wise and SAC-wise Tariff of all the Goods and Services.
The Present Publication is the 14th Edition, authored by Taxmann’s Editorial Board, is amended up to 1st February 2021, with the following noteworthy features:
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The Present Publication is published in two volumes & divided into 6 divisions, which are listed as follows:
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Rates Specified in other Acts
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Services Index
•GST Tariff Notifications (Rate of Tax and Exemptions)
The details coverage of the book is as follows:
•GST Tariff for Goods with HSN Code
•Arrangement of Chapters
•GST Tariff for Goods with HSN Code
•General Rules for the Interpretation of this schedule
•Rates Specified in other Acts
•Rates specified in Central Excise Act
•National Calamity Contingent Duty
•Additional Duty on Tobacco
•Additional Duty on Motor Spirit (Petrol)
•Additional Duty on High Speed Diesel Oil
•Special Additional Excise Duty on Motor Spirit and High Speed Diesel Oil
•Road & Infrastructure Cess
•Agriculture Infrastructure and Development Cess
•GST Rate Reckoner for Goods/Commodity Index
•GST Tariff for Services
•Arrangement of Services
•Central Goods & Services Tax/State Goods & Service Tax Tariff for Services
•Integrated Goods & Services Tax Tariff for Services
•Compensation Cess
•Rate of Tax and Exemption Notifications for Services
•Reverse Charge in case of intra-State supplies of services
•Reverse Charge in case of inter-State supplies of services
•Notified categories of services the tax on intra-State/inter-State supplies of which shall be paid by electronic commerce operator
•No refund of unutilised Input Tax Credit
•Notified registered persons who shall pay tax on reverse charge basis on certain specified supplies of goods or services or both received from an unregistered supplier
•Notified rate of tax to be levied on specified first intra-State supplies of goods or services
•Latest Clarifications
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•Services Index
•GST Tariff Notifications (Rate of Tax and Exemptions)
Taxmann’s Ultimate Best-Seller for Indirect Taxes – ‘GST Ready Reckoner', is a ready referencer for all provisions of the GST Law. It covers all important topics of GST along with relevant Case Laws, Notifications, Circulars, etc.
The Present Publication is the 15th Edition, authored by Mr. V.S. Datey & Updated till 1st February 2021. This book follows the Six-Sigma approach to achieve the benchmark of ‘zero-error’.
The book has been divided into 55 chapters in respect of all-important-provisions of GST, including the following:
•GST – An Overview
•IGST, CGST, SGST and UTGST
•Taxable Event in GST
•Supply of Goods or Services or both
•Classification of Goods and Services
•Value of Taxable Supply of Goods or Services or both
•Valuation Rules if value for GST not ascertainable
•VAT concept and its application in GST
•Input Tax Credit
•Input Tax Credit – Other Issues
•Input Tax Credit when exempted as well as taxable supplies made
•Input Service Distributor
•Persons liable to tax
•Place of supply of goods or services or both other than exports or impacts
•Place of supply in case of export or import of goods or services or both
•Exports and Imports
•Special Economic Zones and EOU
•Time of Supply of Goods and Services
•Reverse Charge
•Exemption from GST by issue of Notification
•Concession to small enterprises in GST
•Construction and Works Contract Services
•Real Estate Services relating to residential and commercial apartments
•TDR/FSI/Upfront amount in long term lease in real estate transactions
•Distributive Trade Services
•Passenger Transport Services
•Financial and related services
•Leasing or rental services and licensing services
•Software and IPR Services
•Business and production services
•Job Work
•Telecommunication, broadcasting and information supply
Community social, personal and other services
Government related activities
•Basic procedures in GST
•Registration under GST
•Tax Invoice, Credit and Debit Notes
•E-way Bill for transport of goods
•Payment of taxes by cash and through input tax credit
Returns under GST
•Assessment and Audit
•Demands and recovery
•Refund in GST
•Powers of GST Officers
•Offences and penalties
•First Appeal and revision in GST
•Appeal before Appellate Tribunal
•Appeals before High Court and Supreme Court
•Prosecution and compounding
•Provisions relating to evidence
•Electronic Commerce
•Miscellaneous issues in GST
•GST Compensation Cess
•Transitory Provisions
•Constitutional Background of GST
Also Available
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[2nd Edition] of Taxmann’s GST Case Laws Digest (A Section-wise Case Book of 1,900+ Judgements)
Presumptive taxation scheme in a new avatarTaxmann
The existing provisions contained in the said section (applicable to individual, HUF or partnership firm) provides that notwithstanding anything to the contrary contained in section 28 to 43C
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NATURE, ORIGIN AND DEVELOPMENT OF INTERNATIONAL LAW.pptxanvithaav
These slides helps the student of international law to understand what is the nature of international law? and how international law was originated and developed?.
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Responsibilities of the office bearers while registering multi-state cooperat...Finlaw Consultancy Pvt Ltd
Introduction-
The process of register multi-state cooperative society in India is governed by the Multi-State Co-operative Societies Act, 2002. This process requires the office bearers to undertake several crucial responsibilities to ensure compliance with legal and regulatory frameworks. The key office bearers typically include the President, Secretary, and Treasurer, along with other elected members of the managing committee. Their responsibilities encompass administrative, legal, and financial duties essential for the successful registration and operation of the society.
ALL EYES ON RAFAH BUT WHY Explain more.pdf46adnanshahzad
All eyes on Rafah: But why?. The Rafah border crossing, a crucial point between Egypt and the Gaza Strip, often finds itself at the center of global attention. As we explore the significance of Rafah, we’ll uncover why all eyes are on Rafah and the complexities surrounding this pivotal region.
INTRODUCTION
What makes Rafah so significant that it captures global attention? The phrase ‘All eyes are on Rafah’ resonates not just with those in the region but with people worldwide who recognize its strategic, humanitarian, and political importance. In this guide, we will delve into the factors that make Rafah a focal point for international interest, examining its historical context, humanitarian challenges, and political dimensions.
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2. Changes in disclosures of Form No. 3CD
The Central Board of Direct Taxes (CBDT) vide Notification No. 33/2018 dated
20th July, 2018 has brought about various amendments in Form 3CD.
These changes are effective from 20th August, 2018.
In addition to the above, Circular 6/2018 dated 17th August, 2018 issued by the
CBDT indicates deferment of two clauses that were inserted vide notification
referred above.
Clause 30C and Clause 44 are kept in abeyance till 31st March, 2019.
3. Changes in disclosures of Form No. 3CD
The scope and effect of section 44AB were explained by the CBDT in circular
No. 387, dated 6th July, 1984 [(1985) 152 ITR St. 11] in para 17. The objective
stated in para 17.2 in this regards is noteworthy and same is reproduced
hereunder─
“17.2 A proper audit for tax purposes would ensure that the books of
accounts and other records are properly maintained, that they faithfully
reflect the income of the taxpayer and claims of deduction are correctly made
by him. Such audit would also help in checking fraudulent practices. It can
also facilitate the administration of tax laws by a proper presentation of the
accounts before the tax authorities and considerably saving the time of
assessing officers in carrying out routine verifications, like checking
correctness of totals and verifying whether purchases and sales are properly
vouched or not. The time of the assessing officers thus saved could be
utilised for attending to more important investigational aspects of a case.”
4. Changes in disclosures of Form No. 3CD
Scope & Effect of tax audit…..
Further, as per section 44AB, an assessee satisfying any of the five broad criteria,
has to obtain and furnish the report of audit in prescribed form and set forth such
particulars as may be prescribed. Thus, the primary responsibility of setting forth the
prescribed particulars is that of an assessee. An auditor only has to verify the same
and report upon the veracity of the same.
Thus, from the plain reading of the provision and object for introduction of the audit
under the Income-tax Act, it is clear that the reporting should be confined to facts and
matters requiring adjudication based on investigation should not form part of the
reporting requirements under the provisions of section 44AB. And rightly so, because
an auditor under the said provision is not vested with the wide powers enjoyed under
the statutory audit provisions of any statute, for example Companies Act, 2013 where
the powers of an auditor are expressly spelt out. Infact, such wide powers are also
not available under section 142(2A) to an auditor for thepurpose of special audit.
5. Clause 4: Details of Registration No. under Indirect tax Law
Whether the assessee is liable to pay indirect tax like excise duty, service tax, sales
tax, customs duty, etc. If yes, please furnish the registration number or any other
identification number allotted for the same.
Changes in the existing clause:
In this list of taxes, GST which has come into force w.e.f. 1st July, 2017 has been
added and the assessee will have to mention GSTIN in this clause.
6. Clause 4: Details of Registration No. under Indirect tax Law
Matters to be considered:
Even if the liability to pay is only under the reverse charge mechanism, the fact of
being liable needs to be answered in the affirmative, with the clarification that such
liability is only under the reverse charge mechanism.
Where an assessee has multiple GSTIN numbers, being registered under different
states as well as under Central GST, all the GSTIN numbers allotted to the
assessee need to be mentioned.
7. Clause 19 : Amounts admissible as deductions from 32AC to 35E
Changes in the existing clause: Disclosure for Section 32AD
Section 32AD provides allowance @ 15% of the cost of any new assets
acquired and installed in an undertaking or enterprise set up for manufacture or
production of any article or thing, on or after 1st April 2015 and before 1st April,
2020 in any backward area notified by the CG in this behalf, in the States of
Andhra Pradesh, Bihar, Telangana or West Bengal.
Reporting Requirement
Allowance under section 32AD of the Income Tax Act shall also be reported.
8. Clause 19 : Amounts admissible as deductions from 32AC to 35E
Matters to be considered
The Tax Auditor should indicate the amount debited to the Profit & Loss Account
and the amount actually admissible in accordance with the said sections.
The Tax Auditor should ensure eligibility of the expenditure/payment for deduction
and compliance of conditions prescribed in the said sections.
9. Clause 24: Deemed Profits and Gains
Changes in the existing clause: Disclosure of deemed gains from Section 32AD
In cases where deduction is claimed under Section 35AD and such asset is
sold or transferred within 5 years from the date of installation, then the
deduction claimed earlier shall be deemed to be the income of assessee and will
be charged under the head ‘Profits and Gains of Business or Profession’.
There are a certain exceptions made for reorganisations, amalgamation or
demerger covered under clauses (xiii), (xiiib) or (xiv) section 47.
10. Clause 24: Deemed Profits and Gains
Reporting Requirement
The amount deemed to be profits and gains under Section 32AD shall also have to
be disclosed in addition to deemed profits and gains u/s 32AC, 33AB, 33ABA,
33AC.
11. Clause 24: Deemed Profits and Gains
Matters to be considered
Non- fulfilment of any condition
If the successor covered under clauses (xiii), (xiiib) or (xiv) of section 47 who has
previously claimed deduction under Section 32AD, transfers within a period of five
years from the date of installation, shall have to offer the amount of deduction
claimed by the predecessor under section 32AD(1) and also report the same under
clause 24.
12. Clause 26 : Disallowance under section 43B
Changes in the existing clause: Disallowance under clause (g) of Section 43B
As per clause (g) of section 43B, any sum payable by an assessee to the Indian
Railways for the use of railway assets is allowable as deduction only if the
payment of the same is made before the due date of filing the return of income.
Reporting Requirement
The reference to said clause (g) is now being added to the Clause 26 and same
will be required to be reported.
13. Clause 26 : Disallowance under section 43B
Matters to be considered
As per clause (g) of section 43B, any sum payable by an assessee to the Indian
Railways for the use of railway assets is allowable as deduction only if the
payment of the same is made before the due date of filing the return of income.
Payments for the use of railway assets would not include basic rail freight, as such
freight is for the service of transport and not for use of railway assets.
In case of payments for use of hoardings/display panels put up on railway
premises, whether the payment is for use of railway assets would depend upon the
terms of the contract.
14. Clause 29A : Forfeiture of an advance [Section 56(2)(ix)]
Addition of new clause
Any sum of money received as an advance or otherwise in the course of
negotiations for transfer of capital asset being forfeited or the negotiations do
not result in transfer of such capital asset, then the same would be taxable as
income under the head ‘Income from Other Sources’.
Reporting Requirement
Under the new clause 29A, tax auditor is required to report :
Whether any amount is to be included as income chargeable under the head
‘IFOS’ as referred to in Section 56(2)(ix)?
If yes, the nature of such income
Amount involved thereof
15. Clause 29A : Forfeiture of an advance [Section 56(2)(ix)]
Matters to be considered
The tax auditor should obtain details of all advances appearing as liability in the
balance sheet of the assessee and determine from the details furnished by the
auditee whether any of such advance is in connection with transfer of a capital
asset.
In cases where minutes are maintained, the same will also need to be checked to
see if any fact of negotiation relating to any such transaction for transfer of capital
asset are terminated and the amount received as advance, if any, is forfeited.
The tax auditor may also obtain confirmation of the third person in respect of
amounts outstanding.
16. Clause 29A : Forfeiture of an advance [Section 56(2)(ix)]
Matters to be considered
Forfeiture of advances/ deposits not covered in cases where:
Not in relation to capital asset
Not in relation to transfer (Example: Deposit taken under lease arrangements-
except in case of effective transfer through lease of 99 years)
Reporting has to be in which year?
Year of receipt/ forfeiture/ failure of negotiations?
What if the terms of contract contain a right to forfeit on some conditions and such
conditions have occurred, but assessee has not yet forfeited the advance?
17. Clause 29B : Deemed Gift [Section 56(2)(x)]
Addition of new clause
Any person receiving on or after the 1st day of April, 2017:-
any sum of money, without consideration, aggregate value of which
exceeds Rs.50,000, whole of the aggregate value of such sum
any immovable property/ any property other than immovable property
without consideration, the stamp duty value/ aggregate FMV of which
exceeds Rs.50,000/-, the stamp duty value/ aggregate fair market value of
such property
any immovable property/ any property other than immovable property
for inadequate consideration, which is less than the stamp duty value/
aggregate FMV of property by an amount exceeding Rs.50,000/-, the stamp
duty value/ aggregate FMV of such property as exceeds such consideration
shall be chargeable to tax under the head ‘Income from Other Sources’.
18. Clause 29B : Deemed Gift [Section 56(2)(x)]
Matters to be considered: Any property other than immovable property is explained
in the diagram:
Immovable
Property
(land/ bldg./
both)
Bullion
Shares &
Securities
Jewellery
Archaelogical
Collections
Drawings/
Paintings
Sculpture
or any
work of
art
19. Clause 29B : Deemed Gift [Section 56(2)(x)]
Matters to be considered
Limited applicability of Old clauses of Section 56(2):
Clause (vii) was applicable only to Individuals/ HUF for receipts by way of
money, immovable property and specified movable property
Clause (viia) was applicable only to Firm/ Closely held company and only
upon receipt of shares of closely held company
Wider applicability of New clause (x) in Section 56(2):
Applicable for receipts on or after 01st April 2017
Clauses (vii) and (viia) are not applicable to such receipts
Clause (x) is applicable for receipts from ANY PERSON of receipts by way of
money, immovable property and specified movable property
20. Clause 29B : Deemed Gift [Section 56(2)(x)]
Matters to be considered
This section is not applicable to certain cases as specified in Section 56(2)(x)
The FMV where applicable shall be determined based on Rule 11U and Rule 11UA
In the cases where individual tax payer’s books of accounts for his business or
profession are common with his personal books of accounts- the tax auditor
should be more careful while verifying the credits to the capital account
In cases where minutes book are required to be maintained, same may be
checked to see if there are receipt of any gratuitous assets
21. Clause 29B : Deemed Gift [Section 56(2)(x)]
Matters to be considered
Applicability of Section 50CA in the hands of a transferor of unquoted equity
shares of a company at a consideration less than the FMV
The CBDT vide Notification No. 61/2017 dated 12-7-2017 amended rules
prescribing the method of valuation of unquoted equity shares for the purpose of
Section 56(2)(x) and Section 50CA by taking into account:
FMV of jewellery, artistic work, shares and securities
Stamp duty value in case of immovable property
Book value for the rest of the assets.
22. Clause 29B : Deemed Gift [Section 56(2)(x)]
Matters to be considered
Issues while calculating FMV of unquoted equity shares as per amended Rule
11UA:
Value of each step down companies needs to be calculated
Difficulty in cases where shares of many companies are owned by the
company whose shares are to be valued
Difficulty in getting the data for the step down companies which are not group
companies.
No threshold provided – Even if one share of an unlisted company is owned –
calculation is necessary
23. Clause 29B : Deemed Gift [Section 56(2)(x)]
Matters to be considered
Identify purchase of immovable properties during the year:
Verify Index II
Check whether SDV as reduced by consideration > Rs.50,000
Tolerance: 5% of sales consideration- Applicable w.e.f. AY 2019-20
Registered: Obtain and verify the registration documents with the price
recorded in the books
Unregistered: Insist on obtaining property value certified by an expert and in
such an event procedure prescribed under SA 620 may be followed. In case
the auditee does not agree to obtain opinion of an auditors’ expert or is of the
view that such an opinion is not necessary, such fact may be disclosed along
with auditee’s view, if any.
24. Clause 29B : Deemed Gift [Section 56(2)(x)]
Reporting Requirement
The tax auditor is required to report :
Whether any amount is to be included as income chargeable under the head
‘IFOS’ as referred to in Section 56(2)(x)?
If yes, the nature of such income
Amount involved thereof
25. Clause 30A: Transfer pricing
Addition of new clause
As per the provisions of Section 92CE(1) of transfer pricing, an assessee is
required to make secondary adjustments in respect of transaction where primary
adjustment is made, of an amount exceeding one crore rupees in the following
circumstances─
By the assessee himself in his return of income or
By the assessing officer which have been accepted by the assesse or
By determination in Advance Pricing Agreement under section 92CC or
As per safe harbour rules framed under section 92CB or
By result of resolution of an assessment under mutual agreement procedure
26. Clause 30A: Transfer pricing
Addition of new clause
Proviso to Section 92CE not applicable to Section 92CE(1):
Amount of primary adjustment made in any previous year does not exceed
Rs.1 crore
Primary adjustment is made in respect of an AY commencing on or before 01st
April, 2016
As per Section 92CE(2), where as a result of primary adjustment:
there is an increase in the total income or reduction in the loss
the excess money which is available with its associated enterprise, if not
repatriated to India within the prescribed time, shall be deemed to be an
advance made by the assessee to such associated enterprise and the interest
on such advance, shall be computed in such manner as may be prescribed
27. Clause 30A: Transfer pricing
Matters to be considered
Primary adjustment means determination of transfer price in accordance with
arm’s length principle resulting in an increase in the total income or resulting in the
loss of the assesse.
Secondary adjustment means the adjustment in the books of accounts of the
assessee and it’s associated enterprise to reflect the true allocation of actual
profits between them.
Excess money means the difference between the arm’s length price determined in
primary adjustment and the price at which the international transaction has actually
been undertaken
28. Clause 30A: Transfer pricing
Matters to be considered
As per Rules 10CB(1), due dates for various types of primary adjustments are as
under:
Types of Primary Adjustment On or before 90 days from
Made Suo Moto Due date of filing return u/s 139(1)
Made by AO and accepted by
assessee
Date of order of AO or appellate
authority
Determined by APA Due date of filing return u/s 139(1)
Made as per Safe Harbour Rules Due date of filing return u/s 139(1)
Made under MAP Due date of filing return u/s 139(1)
29. Clause 30A: Transfer pricing
Matters to be considered
As per Rules 10CB(2), rate of interest to be levied on failure to repatriate excess
money within prescribed time limits are as under:
Transaction Currency Interest Rate
International transaction is
denominated in indian currency
MCLR of SBI as on 1st day of relevant
previous year + 3.25%
International transaction is
denominated in foreign currency
6 month LIBOR as on 30th September
of the relevant previous year + 3%
30. Clause 30A: Transfer pricing
Matters to be considered
The tax auditor will have to enquire whether any of the events mentioned in
Section 92CE have resulted into primary adjustments during the year.
The tax auditor will need to satisfy that all the conditions relating to recognition of
the difference between arm’s length price determined in primary adjustment and
price at which international transaction has actually taken place is duly recognised
in the books of accounts.
The tax auditor will have to satisfy himself of fulfilment of the conditions laid down
in section 92CE and obtain necessary documentation in respect of the same.
31. Clause 30A: Transfer pricing
Matters to be considered
Threshold of Rs.1 crore is qua each international transaction or aggregate of all
international transactions?
Impact on MAT?
Will Section 2(22)(e) be triggered?
Does such adjustment lead to violation of FEMA provisions?
Does such adjustment lead to violation of provisions laid down in Companies Act
2013?
32. Clause 30A: Transfer pricing
Reporting Requirement
If any primary adjustment to the transfer price has been made as per section
92CE(1) of the Act, then provide
Sub clause under which primary adjustment has been made
Amount of primary adjustment
Whether excess money available with the associated enterprise is required to be
repatriated to India as per the provisions of section 92CE(2)
If yes, whether the excess money has been repatriated within the prescribed
time
If no, amount of imputed interest income on such excess money which has not
been repatriated within the prescribed time
33. Clause 30B: Limitation on Interest deduction
Addition of new clause
Section 94B restricts deduction of expense to an Indian Company or a permanent
establishment of a foreign company in India in respect of expenditure by way of
interest or of similar nature deductible under PGBP on debt issued by a non-
resident associated enterprise or on debt issued by non-associated lender where
such associated enterprise has provided implicit or explicit guarantee.
This section shall apply provided such payment exceeds Rupees One Crore in a
previous year.
34. Clause 30B: Limitation on Interest deduction
Addition of new clause
This section not apply to to an Indian company or a permanent establishment of a
foreign company which is engaged in the business of banking or insurance.
Deduction shall be lower of the following:
30% of earnings before interest, taxes, depreciation and amortisation
(EBITDA) or
Actual interest paid/ payable
35. Clause 30B: Limitation on Interest deduction
Matters to be considered
DEBT: Means any
loan
financial instrument
finance lease
financial derivative
or any arrangement that gives rise to interest, discounts or other finance
charges that are deductible in the computation of income chargeable
under the head "Profits and gains of business or profession"
36. Clause 30B: Limitation on Interest deduction
Matters to be considered
GUARANTEE/ IMPLICIT/ EXPLICIT: The same has not been defined and hence,
needs to be interpreted based on The Indian Contract Act
Implicit Guarantee:
Implied, instead of being expressly stated
Even though unexpressed, it is capable of being recognized
Explicit Guarantee:
It is clear and detailed leaving no room for ambiguity
37. Clause 30B: Limitation on Interest deduction
Matters to be considered
INTEREST: Means interest payable in accordance with Section 2(28A) i.e.
interest payable
in any manner
in respect of any moneys borrowed or debt incurred (including a deposit,
claim or other similar right or obligation)
and includes any service fee or other charge in respect of the moneys
borrowed or debt incurred or in respect of any credit facility which has not
been utilised
38. Clause 30B: Limitation on Interest deduction
Matters to be considered
Of similar nature?
The same has not been defined and hence the coverage of such expenditure to
be considered in calculating the limit of Rs. 1 crore is wide.
Will these expenditures be covered within the purview of such similar nature?
Commitment charges
Processing charges
Corporate guarantee fee
Bill discounting charges
39. Clause 30B: Limitation on Interest deduction
Matters to be considered
EBITDA?
The same has not been defined and hence EBITDA should be considered as
per normal parlance
EBITDA as per BOAs
Issue may arise in case in computation of EBITDA as per IndAS and
Accounting Standards (example: In IndAS one has to consider effective
interest)
40. Clause 30B: Limitation on Interest deduction
Matters to be considered
Excess Interest?- Disallowed u/s 94B
Total Interest paid/ payable to non resident associated enterprise as reduced
by 30% of EBITDA OR
Actual interest paid/ payable to non resident associated enterprise
whichever is lower
Whether interest paid or payable would mean only interest pertaining to non
resident associated enterprise or total interest paid/ payable?
Profit making: Interest in excess of 30% of EBITDA shall be disallowed
Loss making: Full interest shall be disallowed
41. Clause 30B: Limitation on Interest deduction
Matters to be considered
The tax auditor will have to obtain details of borrowings by an auditee from its non-
resident associated enterprises and will also have to refer to Form No. 3CEB for
the transactions of borrowings and guarantees reported in the said report.
If the borrowing has been in the years preceding the previous year than details of
all such transaction will have to be obtained from the auditee.
The tax auditor will also need to obtain details of borrowing from non-associated
enterprises which are backed by the security of non-resident associated
enterprise. Direct confirmation should be obtained from banks and other financial
institutions.
42. Clause 30B: Limitation on Interest deduction
Matters to be considered
The auditor should verify the nature of security where any of the borrowings are
stated to be secured.
43. Clause 30B: Limitation on Interest deduction
Reporting Requirement
Following details have to be disclosed in INR:
Whether assessee has incurred expenditure during the previous year by way
of interest or of similar nature > Rs. 1 crore as per section 94B(1)?
Amount of expenditure by way of interest or of similar nature incurred
Amount of EBITDA
Amount of expenditure by way of interest or of similar nature which exceeds
30% of EBITDA
Details of interest expenditure brought forward u/s 94B(4): assessment year to
which it pertains and amount
Details of interest expenditure carried forward u/s 94B(4): assessment year to
which it pertains and amount
44. Clause 30C: Impermissible avoidance agreement
Addition of new clause
KEPT IN ABEYANCE TILL 31st MARCH 2019
An impermissible avoidance arrangement means an arrangement, the main
purpose of which is to obtain a tax benefit, and it
i. creates rights, or obligations, which are not ordinarily created between
persons dealing at arm's length;
ii. results, directly or indirectly, in the misuse, or abuse, of the provisions of this
Act;
iii. lacks commercial substance or is deemed to lack commercial substance
under section 97, in whole or in part; or
iv. is entered into, or carried out, by means, or in a manner, which are not
ordinarily employed for bonafide purposes.
45. Clause 30C: Impermissible avoidance agreement
Addition of new clause
The provisions of GAAR do not apply to an arrangement if the tax benefit in the
relevant assessment year, in aggregate, to all the parties to the arrangement
does not exceed three crore rupees. There are other exclusions also to GAAR.
46. Clause 30C: Impermissible avoidance agreement
Matters to be considered
How the benefit to other parties will be determined?
Does an auditor have power of AO to make detailed investigation to find such IAA?
Labeling an arrangement as impermissible is perception of AO and not assessee
Reference to Pr. CIT and also GAAR panel is required
Auditor is a watchdog, not bloodhound!
47. Clause 30C: Impermissible avoidance agreement
Reporting Requirement
Following details have to be disclosed:
Whether assessee has entered into an Impermissible Avoidance Arrangement
as defined in section 96 during the previous year
If yes, nature of the impermissible avoidance arrangement.
Amount of tax benefit in the previous year arising, in aggregate, to all the
parties to the arrangement (in INR)
48. Clause 31(ba)/ (bb)/ (bc)/ (bd) : Section 269ST
Addition of new sub-clause
No person shall receive an amount of Rs. 2 Lakhs or more
in aggregate from a person in a day or
in respect of a single transaction or
in respect of transactions relating to one event or occasion from a person
otherwise than by account payee cheque/ account payee bank draft or use of
electronic clearing using bank a/c
49. Clause 31(ba)/ (bb)/ (bc)/ (bd) : Section 269ST
Matters to be considered
269ST shall not apply in cases where receipts are made by:
Government
Banking Company
Post Office Savings Bank
Co-operative Bank
Transactions covered under Section 269SS
such other persons or class of persons or receipts, which the Central
Government may, by notification in the Official Gazette, specify.
50. Clause 31(ba)/ (bb)/ (bc)/ (bd) : Section 269ST
Matters to be considered
269ST shall not apply in undermentioned cases as per Notification No. 57/2017
dated 03.07.2017
Receipt by a business correspondent on behalf of bank or co-operative bank,
as per RBI
Receipt by a white label automated teller machine operator from retail outlet
sources on behalf of bank or co-operative bank, as per RBI
Receipt from an agent by an issuer of pre-paid payment instruments as per
RBI
Receipt by a company or institution issuing credit cards against bills raised in
respect of one or more credit cards
Receipts which is not includible u/s 10(17A) -Awards by CG / SG
51. Clause 31(ba)/ (bb)/ (bc)/ (bd) : Section 269ST
Matters to be considered
Whether Rule 6DD shall apply for relaxation from Section 269ST?
Whether cash withdrawn from bank shall be considered within the purview of
Section 269ST- CBDT Press Release dated 05.04.2017
As per Circular No. 22/2017 dated 03.07.2017: For NBFC and Housing Finance
Companies, each Installment shall constitute a single transaction
Transactions by Journal Entries: CIT Vs. Triumph International Finance Ltd. ITA
No. 5745 of 2010 (Bom. HC)
52. Clause 31(ba)/ (bb)/ (bc)/ (bd) : Section 269ST
Matters to be considered
Whether limit shall apply to cash gift received from relatives/ at the time of
marriage?
Whether limit shall apply daily/ monthly/ yearly for household expense taken by
housewife from husband?
Penalty of an equal amount shall be levied u/s 271DA in case of contravention
53. Clause 31(ba)/ (bb)/ (bc)/ (bd) : Section 269ST
Matters to be considered
There is no distinction between:
Capital receipts or revenue receipts
Taxable income or exempt income
Transaction for business purpose or personal purpose
54. Clause 31(ba)
Addition of new sub-clause
Particulars of each receipt exceeding the limit specified in section 269ST,
otherwise than by cheque or bank draft or use of electronic clearing system
through bank account
Reporting Requirement
i. Name, address and PAN (if available with the assessee) of the payer
ii. Nature of transaction
iii. Amount of receipt
iv. Date of receipt
55. Clause 31(bb)
Addition of new sub-clause
Particulars of each receipt exceeding the limit specified in section 269ST, by
cheque or bank draft, not being account payee cheque or account payee bank
draft
Reporting Requirement
i. Name, address and PAN (if available with the assessee) of the payer
ii. Amount of receipt
56. Clause 31(bc)
Addition of new sub-clause
Particulars of each payment exceeding the limit specified in section 269ST,
otherwise than by cheque or bank draft or use of electronic clearing system
through bank account
Reporting Requirement
i. Name, address and PAN (if available with the assessee) of the payee
ii. Nature of transaction
iii. Amount of payment
iv. Date of payment
57. Clause 31(bd)
Addition of new sub-clause
Particulars of each payment exceeding the limit specified in section 269ST, by
cheque or bank draft, not being account payee cheque or account payee bank
draft:–
Reporting Requirement
i. Name, address and PAN (if available with the assessee) of the payee
ii. Amount of payment
58. Clause 31(c)
Changes in the existing clause: Modification in language
Particulars of each payment of loan or specified advance in an amount exceeding
the limit specified in section 269T made during the previous year.
v. In case the repayment was made by cheque or bank draft, whether the same was
taken or accepted by an account payee cheque or an account payee bank draft
Reporting Requirement
The language is modified in as much as the words taken or accepted in sub item (v)
is replaced by repaid
59. Clause 31(d)
Changes in the existing clause: Modification in language
Particulars of repayment of loan or deposit or any specified advance in an amount
exceeding the limit specified in section 269T received otherwise than by a cheque
or bank draft or use of electronic clearing system through a bank account during
the previous year
ii. Amount of loan or deposit or any specified advance amount received otherwise
than by a cheque or bank draft or use of electronic clearing system through a bank
account during the previous year.
Reporting Requirement
The language is modified in as much as the words amount of in sub item (ii) is
replaced by repayment of.
60. Clause 31(e)
Changes in the existing clause: Modification in language
Particulars of repayment of loan or deposit or deposit or any specified advance in
an amount exceeding the limit specified in section 269T received by way of a
cheque or bank draft which is not an account payee cheque or account payee bank
draft during the previous year
ii. Amount of loan or deposit or any specified advance received by way of a cheque or
bank draft which is not an account payee cheque or account payee bank draft during
the previous year
Reporting Requirement
The language is modified in as much as the words amount of in sub item (ii) is
replaced by repayment of.
61. Clause 34 : TDS & TCS
Changes in the existing clause: Disclosure of details/transactions not reported
in TDS/ TCS statements
Clause 34(b) : Filling of TDS and TCS returns
The tax auditor shall report on the compliance by the assesse with provisions of
furnishing of TDS or TCS statements with in prescribed time.
Tax
Deduction &
Collection
Account No.
Type
of
Form
Due date
of
furnishing
statement
Date of
furnishing
statement, if
furnished
Whether the statement of tax
deducted or collected contains
information about all
details/transactions which are
required to be reported. If not,
furnish list of details/
transactions which are not
reported.
62. Clause 34 : TDS & TCS
Matters to be considered
The revised clause requires disclosure pertaining to list of details/ transactions
which are not reported the statement of tax deducted or collected contain.
What about the concept of test check permissible in the Guidance Note?
Whether all the transactions have to be reported here or only the transactions in
which TDS is deducted?
No Deduction due to Certificates / Forms
No Deduction due to threshold limit not exceeded
63. Clause 36A : Deemed dividend
Addition of new clause
Deemed dividend means any payment by a company, not being a company in
which the public are substantially interested, of any sum, by way of advance or
loan
i. to a shareholder, being a person who is the beneficial owner of shares
holding not less than ten per cent of the voting power, or
ii. to any concern in which such shareholder is a member or a partner and in
which he has a substantial interest, or
iii. to any person on behalf, or for the individual benefit, of any such
shareholder
iv. to the extent to which the company in either case possesses accumulated
profits
64. Clause 36A : Deemed dividend
Addition of new clause
ACCUMULATED PROFITS: It includes all profits upto the date of payment of
dividend. With the available jurisprudence, accumulated profits would include
commercial profits in normal sense
i.e. profit and loss account, general reserve, development rebate reserve,
investment allowance reserve, capital redemption reserve and debenture
redemption reserve. Share premium is to be excluded.
“Whether capitalized or not” does not exist in dividend u/s 2(22)(e) and
therefore, if bonus shares have been issued out of reserves, then the same
will not be considered while calculating accumulated profits
65. Clause 36A : Deemed dividend
Addition of new clause
SUBSTANTIAL INTEREST: Assessee is said to have substantial interest, if at any
time during the year, the assessee is entitled to 20% or more of the income of the
concern.
66. Clause 36A : Deemed dividend
Addition of new clause
Following are four situations that may possibly occur:
Situation % of holding
by
Assessee in
company
% of holding
by
Assessee in
Firm/ Concern
Whether
Deemed
Dividend
applicable or
not when the
loan is given to
the assessee?
Whether
Deemed
Dividend
applicable or
not when the
loan is given to
the concern in
which
assessee has
interest?
1 <10% >=20% No No
2 >=10% <20% Yes No
3 <10% <20% No No
4 >=10% >=20% Yes Yes
67. Clause 36A : Deemed dividend
Matters to be considered
The tax auditor will be required to exercise due care in respect of such
transactions and devise elaborate checklist to carry out the audit process.
The tax auditor should obtain the list of all the entities in which the auditee is a
beneficial owner and all the transactions carried out with such entities.
It may be noted that this needs to be reported if the auditee itself is a registered
as well as beneficial owner. There are conflicting judgements on the issue and if
the assessee places reliance on any favourable judgement the said fact should be
brought out in the report.
CIT Vs. Ankitech Pvt. Ltd. 340 ITR 14 (Del.)
National Travel Services Vs. CIT 401 ITR 154 (SC)- Issue referred to a larger
bench
68. Clause 36A : Deemed dividend
Matters to be considered
The list provided by the auditee should be cross verified with clause 23 and notes
to account in respect of transactions with related parties to satisfy himself about
the veracity of the list of such entities provided.
It may be noted that bona fide business transactions may not always be covered
by the fiction of section 2(22)(e) and the tax auditor will have to exercise
professional judgement in deciding whether the transactions are bona fide. In case
of difference of opinion with the auditee the view of the auditee as well as the tax
auditor should be furnished in the report.
Trade advances in the ordinary course of business for business exigencies are not
considered vide Circular No. 18/2017 dated 12.06.2017
69. Clause 36A : Deemed dividend
Matters to be considered
Accumulated profits shall be commercial profits - CIT Vs. P. K. Badiani 105 ITR
642 (SC)
Capital profits shall not be included – Tea Estate India Pvt. Ltd. Vs. CIT 103 ITR
785 (SC)
Profits earned u/s 41(2) shall not be part of accumulated profit – CIT Vs. Urmila
Ramesh 230 ITR 422 (SC)
Practical Issues:
Finding accumulated profit of payer company
Finding accumulated profit on the date of transaction
70. Clause 36A : Deemed dividend
Reporting Requirement
The following details needs to be disclosed:
Whether assessee has received any amount in the nature of dividend as
referred to in Section 2(22)(e)?
If yes, the amount received
Date of receipt.
From AY 2019-20, the applicability of deemed dividend has been shifted from the
recipients to the company and the tax rate is 30% (plus surcharge plus cess)
without grossing up.
71. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Matters to be considered
Form No.61:- Statement containing particulars of declaration received in Form
No.60
Rule 114D(1) - Half yearly statement containing particulars of declaration in Form
No.60 to be furnished in Form No.61 online to DIT(Intelligence and Criminal
Investigation) or JDIT(Intelligence and Criminal Investigation).
Form No.60 - Form for declaration to be filed by an individual or a person (not
being a company or firm) who does not have PAN and who enters into any
transaction specified in Rule 114B.
72. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Matters to be considered
Form No.61:- Statement containing particulars of declaration received in Form
No.60
Rule 114B- There are 18 transactions prescribed wherein if the value exceeds the
prescribed limit against a particular type of transaction, PAN is to be quoted in all
documents pertaining to such transactions.
One of such transaction is sale or purchase, by any person of goods or
services of any nature for an amount exceeding Rs.2 lacs per transaction
73. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Matters to be considered
Due Date to file Form 61:
Persons who do not have a PAN and have taken Form 60, need to file Form 61
half-yearly as per time lines below:
If declarations are received upto 30th September: by 31St October
If declarations are received upto 31st March: by 30th April
74. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Matters to be considered
Form No.61A:- Statement of Specified Financial Transaction u/s 285BA(1)
Section 285BA- Any specified person who is responsible for registering or
maintaining books of accounts or other document containing record of any
specified financial transaction (SFT) or any reportable account as may be
prescribed shall furnish a statement in respect of such SFT or such reportable
account to income tax authority or other authority as may be prescribed.
75. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Matters to be considered
Form No.61A:- Statement of Specified Financial Transaction u/s 285BA(1)
Rule 114E- Every person in respect of the transaction of specified nature and
value entered on or after 01.04.2016 in respect of FY has to furnish a statement in
Form No.61A online. One of such transaction is receipt of cash payment exceeding
Rs.2 lacs for sale of goods or services of any nature by any person who is liable
for audit u/s 44AB. Such person shall take into account all accounts of same
nature and aggregate all transactions of same nature in respect of that person
during the FY.
Form 61A has to be furnished by 31st May of immediately following financial year
in which transaction is registered or recorded.
76. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Matters to be considered
Sr.
No.
Nature & Value of Transaction Monetary
Limits
Reporting Person
1 Receipt of cash payment for sale of
goods or services of any nature from
a person towards a single
transaction.
2 Lacs
(Per transaction)
Any person who is
subject to Tax audit.
2 Receipt from a person for issue
of shares
(including share application money)
10 Lacs (In
aggregate
during the year)
Any Company
3 Buy back of shares from a person
(other than shares bought in the
open market)
10 Lacs (In
aggregate
during the year)
Listed Company
77. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Matters to be considered
Apart from the above mentioned transactions, there are many other transactions that
need to be reported in Form 61A by specified persons such as Banks, Post Master
General, Nidhi Companies, Trustee of Mutual Funds, Authorised person under FEMA,
etc., based on specified monetary limits which are not covered in detail for the sake of
brevity.
Sr.
No.
Nature & Value of Transaction Monetary
Limits
Reporting Person
4 Receipt from a person for acquisition
of bonds or debentures issued by the
company
10 Lacs (In
aggregate
during the year)
Company issuing
bonds or debentures
5 One or more time deposits (other
than a time deposit made through
renewal of
another time deposit) of a person
10 Lacs (In
aggregate
during the year)
NBFCs
78. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Matters to be considered
Penalties on Non-Compliance for Form 61A
If a person fails to furnish the specified statement, penalty of Rs.500 per day of
default will be levied.
However, if the assesse receives any notice from the department for filing the
statement then it must be filed within the limit of 30 days from the date of service of
notice. In case of any default in filing the statement in response to such notice, the
penalty shall be Rs.1,000 per day of default.
If a person furnishes inaccurate particulars in SFT, a penalty of Rs.50,000 shall be
leviable
79. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Matters to be considered
Form No.61B:- Statement of Reportable Account u/s 285BA(1)
Rule 114G- Every reporting financial institution shall furnish the statement of
reportable account in Form No.61B in respect of each account which has been
identified as a reportable account in pursuant to due diligence procedure specified
in Rule 114H. Where no account has been identified as a reportable account, a nil
statement shall be furnished by reporting financial institution.
80. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Matters to be considered
Form No.61B:- Statement of Reportable Account u/s 285BA(1)
Reporting financial institution means:-
(a) a financial institution which is resident in India but excludes any branch of such
institution that is located outside India, and
(b) any branch, of a financial institution which is not resident in India, if that branch is
located in India.
81. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Matters to be considered
The tax auditor shall have to obtain the details of all such statements furnished
during the previous year.
An elaborate checking of the transactions required to be so reported will have to
carried-out by the tax auditor and audit plan will have to be duly modified to cover
this exercise.
82. Clause 42: Statements furnished in Form Nos. 61 or 61A or 61B
Reporting Requirement
Whether assessee is required to furnish statement in Form No.61 or Form No. 61A
or Form No. 61B?
If yes, the details shall be disclosed as under:
Inc om e-tax
Departm ent
Reporting
Entity
Identification
Num ber
Type of
Form
Due date
for
furnishing
Date of
furnishing, if
furnished
Whether the Form
c ontainsinformation
about all details/
transac tionswhic h are
required to be
reported. If not, please
furnish list of the
details/transac tions
whic h are not
reported
83. Clause 43: Furnishing report in respect of international group
Reporting Requirement
Any company liable to file CbCR related forms as required under section 286(2)
needs to disclose the following information:
i. Whether report has been furnished by the assessee or its parent entity or an
alternate reporting entity
ii. Name of the parent entity
iii. Name of alternate reporting entity (if applicable)
iv. Date of furnishing report
Time limit available u/s. 286 is 12 months from end of accounting year – Hence,
report may not have been filed though applicable
84. Clause 43: Furnishing report in respect of international group
Matters to be considered
The tax auditor should ascertain from the auditee whether such report was
furnished by the entity or its parent or it’s alternate reporting entity.
The tax auditor is not required to study the information in detail however he should
take note of the same to the extent relevant.
The details will be required to be furnished in respect of the reports that are due
and furnished during the previous year.
85. Clause 44: Breakup of expenditure of entities registered or not in GST
Addition of new clause
KEPT IN ABEYANCE TILL 31st MARCH 2019
SI
no.
Total
am ount of
expenditure
inc urred
during the
year
Expenditure in respec t of entities registered under
GST
Expenditure
relating to
entities not
registered
under GST
Relating
to goods
or
services
exempt
from GST
Relatingto
entities falling
under
composition
scheme
Relating
to other
registered
entities
Total
payment
to
registered
entities
(1) (2) (3) (4) (5) (6) (7)
86. Clause 44: Breakup of expenditure of entities registered or not in GST
Matters to be considered
Disclosure only for the period of GST regime
Whether reporting has to be done of revenue expenditure only or also for the
capital expenditure?
Details to be given for each expenses separately or total expenses ?
The tax auditor needs to understand the intention of Government behind inserting
this clause. Government intends to matching data available with various tax
authorities and applying data analytics thereon in order to track and punish tax
evaders.
87. Clause 44: Breakup of expenditure of entities registered or not in GST
Matters to be considered
The tax auditor should ensure proper reconciliation between books of accounts
and returns are maintained.
88. For further assistance, contact us:
Benefice Business House, 3rd
Level,
126, Mathuradas Mills
Compound,
N. M. Joshi Marg, Lower Parel
(W),
Mumbai – 400013, India.
T: +91 22 3321 3737
F: +91 22 3321 3838
E: reachus@gbcaindia.com
www.gbcaindia.com