CBIC issues Guidelines for Launching of Prosecution of GST Offences [Read Circular]

The Central Board of Indirect Taxes and Customs (CBIC) has issued guidelines for launching of the prosecution under the Central GST Act, 2017.

Section 132 of the Central Goods and Services Tax Act, 2017 (CGST Act, 2017) codifies the offences under the Act which warrant the institution of criminal proceedings and prosecution. Whoever commits any of the offenses specified under sub-section (1) and sub-section (2) of section 132 of the CGST Act, 2017, can be prosecuted.

As per the circular issued by the Board today, prosecution should normally be launched where amount of tax evasion, or misuse of ITC, or fraudulently obtained refund in relation to offences specified under sub-section (1) of section 132 of the CGST Act, 2017 is more than Five Hundred Lakh rupees. However, in following cases, the said monetary limit shall not be applicable.

“In the cases investigated by DGGI, except for cases pertaining to single/multiple taxpayer(s) under Central Tax administration in one Commissionerate where arrests have not been made and the prosecution is not proposed prior to issuance of show cause notice, prosecution complaints shall be filed and followed up by DGGI. In other cases, the complaint shall be filed by the officer at level of Superintendent of the jurisdictional Commissionerate, authorized by Pr. Commissioner/ Commissioner of CGST. However, in all cases investigated by DGGI, the prosecution shall continue to be sanctioned by appropriate officer of DGGI,” the circular said.

It further stated that a Prosecution Cell in the Commissionerate shall examine the judgment of the Court and submit their recommendations to the Pr. Commissioner/ Commissioner, in cases where appeal is required to be filed.

In cases where prosecution has been sanctioned but complaint has not been filed and new facts or evidence have come to light necessitating review of the sanction for prosecution, the Commissionerate should immediately bring the same to the notice of the sanctioning authority. After considering the new facts and evidence, the sanctioning authority, if satisfied, may recommend to the jurisdictional Pr. Chief Commissioner/ Chief Commissioner that the sanction for prosecution be withdrawn who shall then take a decision.

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GST on House Rent for Tenants applicable to Business Entities Only: Govt

The Government has clarified that the new rule on levying 18% Goods and Services Tax (GST) on house rent for tenants is applicable to business entities only.

A tweet by the official twitter handle of the Press Information Bureau has stated that the levy is applicable in case of renting of residential units to business entities only and the levy would not be applicable when it is rented to a private person for personal use.

It was further clarified that “No GST even if proprietor or Partner of Firm rents residents for personal use,” the twitter handle said.

As per the new rule, a tenant, who is registered under the GST, is required to pay Goods and Services Tax at 18 per cent for renting a property, effective from July 18.

The 18 per cent tax on rent paid is only applicable to tenants registered under the GST, meaning a GST-registered person who carries out business or profession will incur 18 per cent GST on such rent paid to the owner

Earlier, only commercial properties like offices or retail spaces given on rent or lease attracted GST. There was no GST on rent or lease of residential properties by corporate houses or individuals.

As per the new rules, a GST-registered tenant will be liable to pay the tax under the reverse charge mechanism (RCM). The tenant can claim the GST paid under Input Tax Credit as a deduction.

The tax will only apply when the tenant is registered under GST and liable to file GST returns. The owner of the property is not liable to pay the GST.

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No SoP/Instructions/Guidelines by CBDT for Completion of Assessment of Gems and Jewellery Sector: CAG

The Comptroller and Auditor General of India (CAG), in its report tabled before the Parliament, has stated that there is no Standard Operating Procedure (SOP) or instructions/ guidelines has been prescribed by the CBDT for completion of assessment of assessees specific to Gems and Jewellery sector.

The CAG observed from sampled cases checked in audit that the assessments were completed based on disclosures in the Tax Audit Reports and submission made by the assessee. In the absence of proof of detailed examination of valuation details in the assessment records, the audit could not ascertain how the Department satisfied itself with the correctness of the valuation of inventory disclosed by assessees in Income Tax Returns and Tax Audit Reports. Also, no Standard Operating Procedure (SOP) or instructions/ guidelines has been prescribed by the CBDT for completion of assessment of assessees specific to Gems and Jewellery sector.

“There is no provision in the Income Tax Act to deal with the share application money pending allotment for long period. The non-verification of share application money pending for allotment for a long period is indicative of risk of routing of black money or illegal money,” the report said.

Audit noted that the valuation of the diamond depends on four Cs i.e. Cut, Clarity, Colour and Caratage. The Tax Audit Report, however, contains only carat- wise quantitative details of diamonds (rough, rejected & polished), and does not give grade- wise (Cut, Clarity, Colour & Caratage) details. In absence of grade wise details of diamonds, it was not clear how the Department was satisfying itself that the value of diamonds declared by assessee was correct. The gradations of diamonds or precious gems based on difference in cut, clarity, color and carat makes it extremely difficult to have standard valuation methodology.

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Frequent Deferments in Rolling Out of Simplified Return Forms causes Uncertainty in GST Eco System: CAG [Read Report]

The Comptroller and Auditor General of India (CAG), in its report tabled before the Parliament yesterday, stated that the frequent deferments in rolling out the simplified return form are resulting in a delay in stabilisation of the return filing system and continued uncertainty in the GST eco-system.

The report stated that “In the last Audit Report on Indirect taxes, Audit had reviewed the progress made in respect of the implementation of simplified return mechanism under GST and system-verified flow of Input Tax Credit (ITC). Audit observed that owing to continuing extensions in the rollout of the simplified return system, and delay in decision making, the originally envisaged system verified flow of ITC was yet to be implemented despite more than three years of rollout of GST. In the absence of a stable and simplified return system, one of the main objectives of roll out of GST i.e. simplified tax compliance system was yet to be achieved. Accordingly, Audit had recommended that a definite time frame for roll out of simplified return forms may be fixed and implemented as frequent deferments were resulting in a delay in stabilization of the return filing system and continued uncertainty in the GST eco-system.”

During 2020-21, Audit further reviewed the status of implementation of the simplified return mechanism and noted significant progress with respect to linking of GSTR-1, GSTR-2B, and GSTR-3B; and restricting input tax credit (ITC) of the recipient taxpayers to the supplies declared by suppliers.

“However, Audit is of the view that further steps need to be taken to achieve a non-intrusive e-tax system with a system-verified flow of ITC such as mandatory filing of GSTR1 before the filing of GSTR-3B and enhanced use of preventive checks in the GST Common portal,” the report said.

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CESTAT upholds Penalty for Smuggling of Gold from UAE concealing in Embroidery Machine using Freezone Company [Read Order]

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Ahmedabad bench has upheld the penalty imposed on the persons allegedly involved in the smuggling of gold from the UAE using an overseas company. The appellant, Shri Rameshbhai Patel was handling all the works related to import of machine of M/s Ambaji Prints, a proprietorship firm…

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No GST on ‘Sarais’ run by Religious/Charitable Trusts: CBIC

The Central Board of Indirect Taxes and Customs (CBIC) has recently clarified that GST cannot be levied on the ‘Sarais’ run by religious/charitable trusts.

The Board tweeted yesterday through its official twitter handle that “Certain sections of the media and social media are spreading the message that GST has recently been imposed with effect from 18 July, 2022 even on ‘Sarais’ run by religious/charitable trusts. This is not true.”

Based on the recommendations of the 47th GST Council meeting, GST exemption on hotel rooms having room rent upto Rs. 1000 per day has been withdrawn. They are now taxed at 12%. However, there is another exemption which exempts renting of rooms in religious precincts by a charitable or religious trust, where amount charged for the room is less than Rs. 1000/- per day. This exemption continues to be in force without any change.

“It has been stated that the three Sarais managed by SGPC in Amritsar have started paying GST with effect from 18.7.2022. These three Sarais are: 1. Guru Gobind Singh NRI Niwas 2. Baba Deep Singh Niwas 3. Mata Bhag Kaur Niwas,” the CBIC said.

In this regard, the Board has clarified that no notice has been issued to any of these Sarais. These Sarais may have on their own opted to pay GST.

“The precincts of a religious place, in terms of above notification, has to be given broader meaning to include a Sarai even if it is located outside the boundary wall of a complex of a religious place, in the surrounding area, and manged by the same trust/management. This view has been consistently taken by the Centre even in the pre-GST regime. State Tax authorities may also take the same view in their jurisdiction. These Sarais managed by SGPC may therefore avail the above stated exemptions in respect of renting of rooms by them,” the CBIC said.

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CBIC clarified Applicability of GST on Liquidated Damages [Read Circular]

The Central Board of Indirect Taxes and Customs (CBIC) has issued a circular clarifying the GST applicability on liquidated damages, compensation and penalty arising out of breach of contract or other provisions of law.

Applicability of GST on payments in the nature of liquidated damage, compensation, penalty, cancellation charges, late payment surcharge etc. arising out of breach of contract or otherwise and scope of the entry at para 5 (e) of Schedule II of Central Goods and Services Tax Act, 2017.

The circular issued on Wednesday said that “Agreeing to the obligation to refrain from an act or to tolerate an act or a situation, or to do an act” has been specifically declared to be a supply of service in para 5 (e) of Schedule II of CGST Act if the same constitutes a “supply” within the meaning of the Act.”

The circular stated that “forfeiture of earnest money by a seller in case of breach of ‘an agreement to sell’ an immovable property by the buyer or such forfeiture by Government or local authority in the event of a successful bidder failing to act after winning the bid for allotment of natural resources, is a mere flow of money, as the buyer or the successful bidder does not get anything in return for such forfeiture of earnest money. Forfeiture of earnest money is stipulated in such cases not as a consideration for tolerating the breach of contract but as a compensation for the losses suffered and as a penalty for discouraging the non-serious buyers or bidders. Such payments being merely flow of money are not a consideration for any supply and are not taxable.”

It further clarified that “the amount forfeited in the case of non-refundable ticket for air travel or security deposit or earnest money forfeited in case of the customer failing to avail the travel, tour operator or hotel accommodation service or such other intended supplies should be assessed at the same rate as applicable to the service contract, say air transport or tour operator service, or other such services.”

It was also advised the Field formations that while the taxability in each case shall depend on facts of that case, the above guidelines may be followed in determining whether tax on an activity or transaction needs to be paid treating the same as service by way of agreeing to the obligation to refrain from an act or to tolerate an act or a situation, or to do an act.

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CBIC Clarifies Applicable GST Rates & Exemptions on Certain Services [Read Circular]

The Central Board of Indirect Taxes and Customs (CBIC) has issued a clarification on applicable GST rates & exemptions on certain services as per the decision of the GST Council’s recommendation after the 47th meeting held at Chandigarh on 28th and 29th June 2022.

On the recommendation of the GST Council in its 45th meeting, it was clarified vide circular 164/20/2021-GST dated 06.10.2021 that ice cream parlours sell already manufactured ice- cream and they do not have a character of a restaurant and hence, ice cream sold by a parlour or any similar outlet attracts the standard rate of GST @ 18% with ITC.

The circular issued on Wednesday said that “it can be seen that all services supplied by an ‘educational institution’ to its students are exempt from GST. Consideration charged by the educational institutes by way of entrance fee for the conduct of entrance examination is also exempt. The exemption is wide enough to cover the amount or fee charged for admission or entrance or the amount charged for the application fee for entrance, or the fee charged from prospective students for the issuance of an eligibility certificate to them in the process of their entrance/admission to the educational institution. Services supplied by an educational institution by way of issuance of migration certificates to the leaving or ex-students are also covered by the exemption. Accordingly, such activities of educational institutions are also exempt.”

“Accordingly, it is clarified that the amount or fee charged from prospective students for entrance or admission, or for issuance of eligibility certificate to them in the process of their entrance/admission as well as the fee charged for issuance of migration certificates by educational institutions to the leaving or ex-students is covered by an exemption under Sl. No. 66 of Notification No. 12/2017-Central Tax (Rate) dated 28.06.2017,” the circular said.

It was further clarified that the service by way of storage or warehousing of cotton in ginned and or baled form was covered under entry 24B of notification No. 12/2017- Central Tax (Rate) dated 28.06.2017 in the category of raw vegetable fibres such as cotton. It may however be noted that this exemption has been withdrawn w.e.f 18.07.2022.

Regarding the exemption on services associated with transit cargo both to and from Nepal and Bhutan, the regulations governing transit/transhipment have to be followed in addition to ensuring that an electronic track and trace facility is in place. This facility uses container numbers to locate the cargo. Thus, it is verifiable that the empty container returning from Nepal or Bhutan is the same container which was used to deliver goods to Nepal or Bhutan.

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CBIC clarifies GST Rates on Items as per Council’s Decision [Read Circular]

The Central Board of Indirect Taxes and Customs (CBIC) has clarified the GST rates applicable on certain items as per the recommendations of the GST Council meeting held on 29th and 30th of June.

The circular released by the Board today said that electrically operated vehicle including three-wheeled electric vehicle means vehicle that runs solely on electrical energy derived from an external source or from electrical batteries. Therefore, the fitting of batteries cannot be considered as a concomitant factor for defining a vehicle as an electrically operated electric vehicle.

Noting that the WCO’s HSN Explanatory notes have also not considered batteries to be a component, whose absence changes the essential character of an incomplete, unfinished or unassembled vehicle, the Board has clarified that electrically operated vehicle is to be classified under HSN 8703 even if the battery is not fitted to such vehicle at the time of supply and thereby attract GST at the rate of 5% in terms of entry 242A of Schedule I of notification No. 1/2017-Central Tax (Rate).

Regarding, minor polished stones, the Board said that “Napa Stone is a variety of dimensional limestone, which is a brittle stone and cannot be subject to extensive mirror polishing. Currently, S. No. 123 of Schedule-I prescribes GST rate of 5% for ‘Ecaussine and other calcareous monumental or building stone; alabaster [other than marble and travertine], other than mirror polished stone which is ready to use.’ However, being brittle in nature, stones like Napa Stone, even though ready for use, are not subject to extensive polishing. Therefore, such minor polished stones do not qualify as mirror polished stones.”

The circular also clarified that supply of treated sewage water, falling under heading 2201, is exempt under GST. Further, to clarify the issue, the word ‘purified’ is being omitted from the above-mentioned entry vide notification No. 7/2022-Central Tax (Rate), dated the 13th July, 2022.

With regard to the GST rate applicable on Nicotine Polacrilex Gum, it was clarified that it is commonly applied orally and is intended to assist tobacco use cessation is appropriately classifiable under tariff item 2404 91 00 with applicable GST rate of 18% [Sl. No. 26B in Schedule III of notification no. 1/2017-Central Tax (Rate), dated the 28th June, 2017].

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GST Investigation is Virtually Over: Gujarat HC grants Bail to Accused for Allegedly Evading Rs. 21 Cr [Read Order]

The Gujarat High Court has granted bail to an accused person for allegedly evading GST worth Rs. 21 Crores considering the fact that the investigation by the department is virtually over.

The department arrested the applicant based on the conclusion that Mr. Mohmed Hasan Aslam Kaliwala, along with others, were indulged into activities of creating fictitious entity to pass ineligible input tax credit using Two fake firms. The findings of the investigation emerged that these firms doing wrongful activity of issuing fake invoices, to pass ineligible input tax credit to beneficiaries without any actual movement of goods, whereby, the applicant caused revenue loss to the government exchequer to the tune of Rs.21.59 crores, as bypassing the illegal ITC, the beneficiary firms had claimed unlawful input tax credit.

The petitioner contended that both the firms had filed regular returns for its business transactions and till date, have not received any show cause notice, raising any dispute with respect to fake invoices etc. It was also contended that both the firms have filed their return in GSTR1 disclosing sale of goods and same was being reflected in GSTR2A and therefore, question does not arise, to avail wrongfully ITC.

After hearing arguments from both sides, Mr. Justice Ilesh J. Vora observed that “so far 2 firms are concerned, as referred above, investigation is virtually over. The applicant being an authorized attorney of 2 firms, initially he had evaded the investigation but later on after his arrest and during his remand period, he was interrogated extensively and necessary materials have been recovered. Department has also filed complaint against the applicant. The applicant herein to show his bonafide, willing to deposit Rs.2 crore, which is approximately 10% of the alleged amount. Considering the facts and circumstances of the present case, it is worthwhile to note the observation made by the Apex Court in the case of Sanjay Chandra Vs. CBI, reported in 2012 2 SCC 40, wherein, it was observed that “constitutionally protected liberty must be respected unless the detention becomes necessary. The balance approach is to grant bail subject to certain conditions rather than to keep the individual under detention for an indefinite period.”

Granting bail to the accused, the High Court held that “for the foregoing reasons, considering the facts and circumstances of the present case and role attributable to present applicant herein as well as his bonafide to deposit Rs.2 crore, this Court is of the considered view that case is made out for exercising discretion enlarging the applicant on bail and accordingly, I incline to release the applicant on bail, subject to deposition of Rs.2 crore before the office of the Deputy Commissioner of State Tax, Division 8, Enforcement, Surat within a period of 2 months from his release.”

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7,312 CA Freshers got placed in ICAI Campus Placement Programme

In a Positive News of today, 7,312 CA Freshers got placement in ICAI Campus Placement Programme 2022.

The 55th edition of Campus Placement programme witnessed great success with 7312 newly qualified CAs getting job offers, out of 10,197 registered candidates. A record number of 173 companies participated in the programme which was held virtually at 9 major and 12 smaller centres across India.

Buoyed by the success, ICAI has decided to extend the campus programme to more number of cities. The 56th edition of Campus programme will cover 6 additional centres viz. Bhopal, Lucknow, Patna, Raipur, Ranchi and Vadodara, thus taking the number of centres to 9 major and 18 smaller centres.

Four existing major centres viz. Ahmedabad, Hyderabad, Jaipur and Pune are being elevated as premier day centres, where a minimum CTC of Rs.17 lakhs per annum will have to be offered on the premier day of interviews. The minimum threshold limit of CTC is being increased to Rs.9 lakhs per annum at all existing centres. For new centres, the CTC is being increased to Rs.7.2 lakhs per annum.

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ITR filing Due Date Not Extended: Income Tax Dept receives Over 5 Crores Returns, 50% Yet to File

As the last date for filing of income tax return is ending today, the income tax department has received more than 5.10 crores income tax returns so far out of 10,51,20,151 individual registered users.

The Central Board of Direct Taxes (CBDT), on Saturday announced considering the rush, the department has launched a helpline in order to assist the taxpayers in filing the return.

“More than 5.10 crore ITRs have been filed till 30th July,2022. Over 57.51 lakh #ITRs were filed on 30th July,2022 itself. Do remember to file yours, if not filed as yet. #FileNow to avoid late fee. Today is the due dt to file #ITR for AY 2022-23 Pl visit: http://incometax.gov.in,” the income tax department tweeted today morning from its official twitter handle.

Earlier, the Central Government has clarified that there will not be any extension for the income tax return filing for the year 2022-23.

“Government not considering extending July 31 deadline for filing income tax returns,” the official twitter handle of the Press Trust of India tweeted today.

Post this, the tax practitioners all over the country was urging the Government to extend the due date citing technical reasons including the glitches on the income tax portal. However, there is no hints from the Government so far for the extension of due date.

The Income Tax Act, 1961 provides a number of penal provisions to curb tax evasion and penalize the defaulters in case of non-filing of returns and non/short payment of income tax.

A penalty of Rs 5,000 will be charged for the delay in filing returns if the total income to be reported exceeds Rs 5 lakh. For small taxpayers, if the total income of the person is less than Rs 5 lakh, then the fee payable is up to Rs 1,000.

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Income Tax Update: ASK Centres are Open Tomorrow to facilitate Income Tax Return Filing, says CBDT [Read Order]

The Central Board of Direct Taxes (CBDT) has passed an order stating that the Aadhaar Seva Kendra (ASK) centres shall be open tomorrow during normal hours to facilitate the income tax return filing for the taxpayers.

The order passed by the Board on Saturday evening stated that “The prescribed due date as per the provisions of sub-section (1) of section 139 of the Income-tax Act,1961 (‘Act’) for filing of returns of income for assessment year 2022-23 in respect of non-auditable cases is 31st July 2022. In view of closed holiday on 31st July 2022, being Sunday, it is hereby directed that ASK Centers throughout India shall remain open on 31″ July 2022 during normal office hours. Further, special arrangements may also be made by way of opening additional receipt counters, wherever required, on 31. July 2022, to facilitate filing of tax returns by the taxpayers.”

The income tax department, in the evening, declared that approx. 26,82,031 have been filed till 4 o’clock and 3,97,792 between 5 p.m to 6 p.m and 4,48,676 p.m from 6 to 7 p.m. Considering the rush, the department has launched a helpline in order to assist the taxpayers in filing the return.

“Some more statistics of Income Tax Returns filed today. 35,67,263 #ITRs have been filed upto 1800 hours today & 4,48,676 #ITRs filed in the last 1hour. For any assistance, please connect on orm@cpc.incometax.gov.in. We will be glad to assist! @FinMinIndia,” the department tweeted a few minutes ago.

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Income Tax Update: 4.5 Lakh Returns filed in One Hour, Dept launches Helpline for Assistance

The Central Board of Direct Taxes (CBDT), on Saturday, announced that approx. 26,82,031 have been filed till 4 o’clock and 3,97,792 between 5 p.m to 6 p.m and 4,48,676 p.m from 6 to 7 p.m. Considering the rush, the department has launched a helpline in order to assist the taxpayers in filing their returns.

“Some more statistics of Income Tax Returns filed today. 35,67,263 #ITRs have been filed up to 1800 hours today & 4,48,676 #ITRs filed in the last 1hour. For any assistance, please connect to orm@cpc.incometax.gov.in. We will be glad to assist! @FinMinIndia,” the department tweeted a few minutes ago. “Here are some statistics of Income Tax Returns filed today. 26,82,031 #ITRs have been filed up to 1600 hours today & 3,97,792 #ITRs have been filed in the last 1hour. For any assistance, pl connect to orm@cpc.incometax.gov.in. We will be glad to assist! @FinMinIndia, the department tweeted from its official Twitter handle for an hour.

Earlier in the morning, the department tweeted that “Over 4.52 crore ITRs filed till 29th July, 2022 & more than 43 lakh ITRs filed on 29th July, 2022 itself. Hope you have filed yours too! If not, pl #FileNow Due date to file ITR for AY 2022-23 is 31st July, 2022. Pl visit: http://incometax.gov.in #ITR @FinMinIndia

Earlier, the Central Government clarified that there will not be any extension for the income tax return filing for the year 2022-23.

“Government not considering extending July 31 deadline for filing income tax returns,” the official Twitter handle of the Press Trust of India tweeted today.

Post this, tax practitioners all over the country were urging the Government to extend the due date citing technical reasons including the glitches on the income tax portal. However, there are no hints from the Government so far regarding the extension of the due date.

The Income Tax Act, 1961 provides a number of penal provisions to curb tax evasion and penalize the defaulters in case of non-filing of returns and non/short payment of income tax.

A penalty of Rs 5,000 will be charged for the delay in filing returns if the total income to be reported exceeds Rs 5 lakh. For small taxpayers, if the total income of the person is less than Rs 5 lakh, then the fee payable is up to Rs 1,000.

After December 31st of the relevant assessment year, one cannot voluntarily file ITRs. After that, if and when the income-tax department picks up your income and tax details available for scrutiny, the department will direct the defaulter on how to comply with the mandatory provisions by paying penalties and interest.

Section 234 of the Income-Tax Act deals with penal interest that is levied for delays in paying taxes on time.

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‘BRANDED’ to ‘PRE-PACKED & LABELLED’ – What does it actually mean?

GST implications on pre-packaged and labelled commodity has been a subject matter of discussion amongst the trade post the 47th GST Council meeting. To remove ambiguity in interpreting various clauses pertaining to pre-packaged and labelled commodity especially due to interplay between Legal Metrology (Packaged Commodity) Rules, 2011 (‘LMPC Rules’) and GST Notifications, basis the representations from the industries, CBIC also issued FAQs on July 17, 2022.

The CBIC has been issuing notifications from time to time, particularly in respect of food items like pulses, flour, cereals, etc. (specified items falling under the Chapters 1 to 21 of the Tariff) including the recent ones viz. Notification No. 6/2022-Central Tax (Rate) and Notification No. 7/2022-Central Tax (Rate), dated the July 13, 2022.

In this article we shall analyse the impact of the said change and related FAQs. The change so introduced vis-à-vis old provision is tabulated below:

Prior to July 18, 2022 (i.e., before clarification)W.e.f. July 18, 2022 (i.e., after clarification)
GST applied on specified goods: When they were put up in a unit container; andWhen they were bearing a registered brand name or were bearing brand name in respect of which an actionable claim or enforceable right in a court of law is available. For example: items like pulses, cereals like rice, wheat, and flour (aata), etc., attracted GST at the rate of 5% when branded and packed in unit container.GST has been made applicable: On supply of such “pre-packaged and labelled” commodities attracting the provisions of Legal Metrology Act.Additionally, certain other items such as Curd, Lassi, puffed rice etc when “pre-packaged and labelled” would attract GST at the rate of 5%.For example: items like pulses, cereals like rice, wheat, and flour (aata), etc., would attract GST when “pre-packaged and labelled”.

Since the applicability of GST is linked with the term ‘pre-packaged and labelled’. It becomes important to understand such terms first.

As per GST Law, ‘pre-packaged and labelled’ means a ‘pre-packaged commodity’ as defined in clause (l) of Section 2 of the Legal Metrology Act, 2009 (herein after referred to as ‘LMA’). Clause (l) of section 2 of the Legal Metrology Act reads as below:

“Section 2(l) “pre-packaged commodity” means a commodity which without the purchaser being present is placed in a package of whatever nature, whether sealed or not, so that the product contained therein has a pre-determined quantity.”

Basis the reading of the above, it is clear that Supply of such specified commodity having the following two attributes would attract GST:

  1. Pre-packaged
  2. Labelled (with prescribed declaration)
    1. Such packages have declaration (where it is required to bear declarations under the provisions of LMA and the Rules made thereunder)
    1. Such packages do not have declaration (where it is not required to bear the declarations under the provisions of LMA and the Rules made thereunder)

Further, from LMPC Rules perspective, the provisions are bifurcated in seven chapters. For ready reference, the chapter wise heading is provided as follows:

  1. CHAPTER I – Short title, and Commencement and Definitions (Rule 1 and Rule 2)
  2. CHAPTER II – Provisions Applicable to Packages Intended for Retail Sale (Rule 3 to Rule 23)
  3. CHAPTER III – Provisions Applicable to Wholesale Packages (Rule 24)
  4. CHAPTER IV – Export of Packaged Commodities (Rule 25)
  5. CHAPTER V – Exemptions (Rule 26)
  6. CHAPTER VI – Registration of Manufacturers, packers, and Importers (Rule 27 to Rule 30)
  7. CHAPTER VII – General ((Rule 31 to Rule 34)

As per the FAQ, it has further been clarified that:

“Chapter II – Provisions Applicable to Packages Intended for Retail Sale

[3. Application of Chapter. – The provisions of this chapter shall not apply to-

(a) packages of commodities containing quantity of more than 25 kilogram or 25 litre;

(b) cement, fertilizer and agricultural farm produce sold in bags above 50 kilogram; and

(c) packaged commodities meant for industrial consumers or institutional consumers.]”

Basis the above, supply of packaged commodity for consumption by industrial consumer or institutional consumer, packages above 25 Kgs/litre. quantity and cement, fertilizer and agricultural farm produce sold in bags above 50 kgs are excluded from the law and will not be considered as pre-packaged. Therefore, such category of items would not be taxable under GST law as well.

“CHAPTER-II- Provisions Applicable to Packages Intended for Retail Sale

Rule 4(2) When one or more packages intended for retail sale are grouped together for being sold as a retail package on promotional offer, every package of the group shall comply with provisions of rule 6.]”

“CHAPTER-III-Provisions Applicable to Wholesale Packages

Rule 24. Declarations applicable to be made on every wholesale package. – Every wholesale package shall bear thereon a legible, definite, plain and conspicuous declaration as to –

(a) The name and address of the manufacturer or importer or where the manufacturer or importer is not the packer, of the packer;

(b) the identity of the commodity contained in the package; and

(c) the total number of retail package contained in such wholesale package or the net quantity in terms of standard units of weights, measures or number of the commodity contained in wholesale package;

Provided that nothing in this rule shall apply in relation to a wholesale package if a declaration Similar to the declarations specified in this rule, is required to be made on such wholesale packages by or under any other law for the time being in force.

To decipher the above FAQs better, we have encapsulated the applicability of LMA & GST on specified Pre-Packed Commodities in the flowchart below:

As per LMA provision, wholesale package qualifies to be pre-packaged commodity which requires declarations under Rule 24 of the LMPC Rules. However, the question that arises is that by conjoint reading of Rule 3 (a) read with Rule 24, can we conclude that the LMA provisions as application to retail packs are also applicable to wholesale packs? Further, from GST perspective, the exemption to wholesale package is not coming from the exemption notification, however, the FAQs cite such exemption. Can it be said that in so far as the FAQ provide exemption to wholesale packs, is it going beyond what is envisaged in the LMA?

Conclusion:

Since the introduction of GST, the intent of the government is to widen the tax net by curbing exemptions and bringing more Goods and Services into tax net.

The biggest slogan of Indian socialism is ‘Roti, kapda aur makaan’. Till now the government has taxed Kapda and makaan. However, roti or essential food ingredients remained outside the purview of GST. This is the first time that basic food items are being brought under the tax net in the garb of pre-packaged goods. Due to the same reason, there is an uproar in the food trader industry. The implications of this taxability would be grave. The common man or the ‘aam aadmi’ will be directly hit by this withdrawal of exemption. Grocery stores or kirana traders would certainly prefer selling items in loose quantities as against the pre-packed ones for the simple reason of being competitive and escaping taxes. However, this could have certain non-tax implications such as hygiene factors, fraudulent weight systems and unregulated quality of food items. Moreover, small players dealing in unbranded food items shall bear a brunt of this decision. Till date they did not have to obtain registration under GST and conduct compliances. However, with this change they will be obligated to obtain registration under GST (if threshold is crossed).

From a tax point of view, Section 14 of the CGST Act, 2017 needs to be evaluated. The said section prescribes time of supply in cases where there is a change in rate of tax on specified goods and/or services.

While the Government has issued FAQs in the said matter, there are still some issues which require clarifications. Moreover, as the time shall pass, the industry would face practical challenges and would have to approach the ministry for the same. Nonetheless, since the levy is in force now, better watch your grocery bills for some ITC that can be availed.

JD - BRANDED-PRE-PACKED-LABELLED-GST-Taxscan

Mr. Jigar Doshi, Founding partner

NG picture -BRANDED-PRE-PACKED-LABELLED-GST-Taxscan

Ms. Nirali Gada Manager at TMSL

Sakshi Hasija -BRANDED-PRE-PACKED-LABELLED-GST-Taxscan

Ms. Sakshi Hasija Assistant Manager at TMSL

The views are personal and the authors can be reached at jigar.doshi@tmsl.in.

CESTAT initiates ‘Contempt of Court’ Proceedings against Asst Commissioner for Issuing Notice despite Tribunal Order [Read Order]

The Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has referred a matter to the High Court for initiating ‘Contempt of Court’ proceedings against the Assistant Commissioner (Service Tax) for issuing a show-cause notice against the assessee by ignoring the Tribunal order. The assessee, M/s Portech India Pvt Ltd, filed a…

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ITAT Weekly Round-Up

This weekly round-up analytically summarizes the key stories related to the Income Tax Appellate Tribunal (ITAT) reported at Taxscan.in during the previous week from July 16 to July 22, 2022

Technichem Organics Pvt. Ltd. vs Income Tax Officer – 2022 TAXSCAN (ITAT) 999

The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench has held that the waiver of principal loan amount in cash cannot be treated as business perquisite under section 28(iv) of the Income Tax Act, 1961. A bench comprising Shri P.M. Jagtap, Vice President and Ms. Suchitra Kamble, Judicial Member observed that relied on the case of Mahindra & Mahindra and held that the decision is applicable in the present case as in the said case it was categorically held that when the assessee had not claimed deduction under Section 36(1)(iii) of the Act for interest on loan and loan was taken for acquiring capital asset then the waiver was on account of liability other than trading liability and thus provisions of Section 41(1) does not apply in such cases.

M/s.Panyam Cements & Mineral Industries Ltd vs Asst.Commissioner of Income Tax 2022 TAXSCAN (ITAT) 1000

The Income Tax Appellate Tribunal ( ITAT ) Hyderabad bench has held that the claim of Income tax dues can’t be more excessive than the resolution plan approved by NCLT. Shri Rama Kanta panda, AM and Shri Laliet Kumar, Judicial Member held that “the Revenue is bound by the resolution plan as accepted by the NCLT and not entitled to anything more than what is provided therein.”

ACIT vs M/s. Cairn UK Holding Ltd 2022 TAXSCAN (ITAT) 998

The Delhi Bench of Income Tax Appellate Tribunal (ITAT), has held that Long Term Capital Gain (LTCG) arises from the transfer of the share of a closely held company and is chargeable to tax at the rate of 10%. The Coram of Mr. Saktijit Dey, Judicial Member, and Dr. B.R.R. Kumar, Accountant Member has held that “we find, the Hon’ble Delhi High Court after analyzing the provisions of section 48 and 112(1) of the Act has concluded that the assessee is entitled to avail the beneficial tax rate under section 112(1) of the Act. Thus, in view of the aforesaid binding precedent of the Hon’ble Jurisdictional High Court, we do not find any infirmity in the decision of learned Commissioner (Appeals)”.

Ravindra Champalal Khinvasara vs DCIT 2022 TAXSCAN (ITAT) 988

Income Tax Appellate Tribunal (ITAT), Pune held that examination of nature of work and income necessary for granting deduction for housing projects u/s801B (10). The assessee, Ravindra Champalal Khinvasara is a developer and promoter in real estate. During the course of assessment proceedings, the Assessing Officer (AO) observed that the assessee claimed deduction u/s.80IB (10), inter alia, on receipts from ‘extra work’ done amounting to Rs.2,99,910/-. The assessee was asked to furnish the details of such extra work, which he could not. In the absence of such details, the AO rejected the claim of deduction on it. The CIT(A), too, upheld the disallowance pro tanto. Aggrieved thereby, the assessee has come up in appeal before the Tribunal.

Microsoft Regional Sales Pte. Ltd. vs ACIT –  2022 TAXSCAN (ITAT) 982

The Income Tax Appellate Tribunal (ITAT), Delhi bench has partly allowed an appeal of the Microsoft Regional Sales Pte. Ltd relating to a TDS Credit Claim worth Rs. 392 Crores. Addressing the other issue on subscription to cloud services, the Tribunal observed that “The very same issue regarding the cloud service in the case of MOL Corporation for the AY 2012-13 came up for consideration before the Co-ordinate Bench of the Tribunal. The Co-ordinate Bench, by following the ratio laid down in the case of M/s. Salesforce.com Singapore Pte. Vs. Dy. D.I.T. Circled-2(2) ITA No. 4915/Del/2016 [A.Y 2010-11] and also the decision of Mumbai Tribunal in the case of DDIT Vs. Savvis Communication Corporation [2016] 69 Taxman.com 106 (Mumbai- Trib.) and the Chennai Tribunal decision in the case of ACIT Vs/. Vishwak Solutions Pvt. Ltd. ITA No. 1935 & 1936/MDS/2010 dated 30/01/2015, held that the authorities fallen in error in considering the subscription received towards cloud serviced to be royalty income.”

Mahesh K. Bhutiya Vs Income Tax Officer 2022 TAXSCAN (ITAT) 980

In a significant ruling, the Rajkot bench of the Income Tax Appellate Tribunal (ITAT) has held that as a relief to small taxpayers, maintaining books u/s 44 AD of the Income Tax Act,1961 is not required for small businesses and deleted the addition. It was evident that small businessmen were not required to maintain books of accounts as per Section 44AD of the Act and were difficult for the assessee to produce bills to substantiate his turnover in cash that too after a lapse of six years. The Tribunal held that the entire deposits of Rs. 18,66,000/- in cash in the bank can be safely attributed to the business receipts of the assessee only.

M/s. Essel Finance VKC Forex Ltd vs DCIT –  2022 TAXSCAN (ITAT) 1002

The Income Tax Appellate Tribunal ( ITAT ) Chennai Bench deleted the addition of “Deemed Dividend” in the absence of proof to establish payment to a shareholder or person who has a beneficiary interest in the company. The assessee advanced sum of Rs.7.50 Crores to an entity namely M/s. Arun Priya Services Ltdon lease.The AO held that the assessee was liable for TDS on the said payment u/s 194 and therefore, made a disallowance of Rs.169.50 Lacs to the income of the assessee. The sum has been treated by AO as deemed dividend u/s 2(22)(e) of the Act on the ground that one of the directors of the assessee company held a substantial interest in that entity.

Jigneshbhai Kishorbhai Bhajiyawala (HUF) vs I.T.O 2022 TAXSCAN (ITAT) 990

The Income Tax Appellate Tribunal (ITAT), Surat Bench has upheld the denial of capital gain exemption under section 54 by holding that an unregistered document has no evidentiary value. The Tribunal has held that “we find that there is no other corroborative evidence to substantiate the claim of the assessee that she acquired or holding possession of the property since 14/02/2007, therefore, we uphold the orders of lower authorities in treating the capital gain as short-term capital gain in place of long-term capital gain as claimed by the assessee”.

Aadarh Developers vs A.C.I.T 2022 TAXSCAN (ITAT) 979

The Rajkot bench of the Income Tax Appellate Tribunal ( ITAT ) has held that a change in the method of treating income would lead to double taxation if the sales consideration amount was taxed once. The Tribunal observed that the CIT failed to look into the income which has already been taxed in the earlier years and in the absence of such direction it would lead to the double addition in the hands of the assessee. Further observed that the assessee has been following the method of accounting for recognizing the income consistently which has been accepted by the revenue and the revenue cannot interfere to change the method adopted by the assessee when the income of the assessee has already been taxed in the later years.

Diamond Beverages Private Limited vs Pr. CIT –  2022 TAXSCAN (ITAT) 1001

The Income Tax Appellate Tribunal (ITAT), Kolkata Bench has held that Principal Commissioner of Income Tax (PCIT) fails to record the reason for revision and quashes order u/s 263. The Coram of Mr. Rajpal Yadav, Vice President,and Mr. Rajesh Kumar, Accountant Member has observed that the Pr. CIT has not recorded any finding that the recipients were not enjoying registration u/s 80G of the Act, neither this fact was verified by him. His reasoning is from the angle that there is a distinction between the expenditure claimed under CSR expenditure and donation made u/s 80G of the Act. Hence the Tribunal held that “we are of the view that the impugned order is not sustainable and hence the same is quashed”.

Sudhi Jain vs ITO – 2022 TAXSCAN (ITAT) 997

Income Tax Appellate Tribunal (ITAT), Cuttack deleted penalty as assessee duly complied with notices issued under Section 142(1)(i). The AO observed that the 271F proceedings which were initiated on the assessee for PAN number AIGPJ6846F and not on against the PAN ACXPJ2118B, assessee again requested to keep the proceedings under section 271F in abeyance till the disposal of appeal on verification it was observe by the AO that the assessee has not filed appeal under the PAN number AIGPJ6846F on which the penalty proceedings were initiated accordingly penalty under section 271F for Rs. 5000 was imposed by order dated 22/02/2020. Aggrieved with action of AO, assessee filed an appeal with the CIT(A). The CIT(A) in his order u/s 250 of the ACT dismissed the appeal as invalid and not maintainable in law.

Arunkumar Purshotamlal Khanna vs PCIT 2022 TAXSCAN (ITAT) 1003

The Income Tax Appellate Tribunal (ITAT), Pune Bench has held that amendment to section 54F (1) applicable from 1.4.2015 onwards and grants capital gain deduction for the purchase of multiple residential units. The Coram of Mr. S. S. Godara, Judicial Member, and Dr. Dipak P. Ripote, Accountant Member observed that the appellant purchased the twin residential units in the year 2014 itself whereas the clinching amendment to section 54F (1) is applicable with prospective effect from 1.4.2015 only. Hence, “a residential house” for section 54F (1) deduction can indeed cover multiple units in the same or different towers or residential blocks; as the case may be.

Lake View Hospitality vs Dy. Commissioner of Income Tax2022 TAXSCAN (ITAT) 984

The Income Tax Appellate Tribunal ( ITAT ) Mumbai bench held that the relief u/s 43B of the Income Tax Act can be availed if the VAT liability was paid before the due date of filing the return. Shri Om Prakash Kant, Accountant Member and Shri Sandeep Singh Karhail, judicial member remanded the issue and directed to grant relief to the assessee under section 43B of the Act, if upon verification found that the VAT liability was paid by the assessee before the due date of filing return under section 139(1) of the Act.

Senapati Satija vs ACIT 2022 TAXSCAN (ITAT) 973

The Delhi bench of the Income Tax Appellate Tribunal (ITAT), while deleting a penalty order, has held that non-compliance with S.44AB of the Income Tax Act, 1961 can be excusable if it was committed without dishonest intention. The Tribunal observed that the assessee committed default the first time for non-complying with the provisions of section 44AB because the case of the assessee crossed the threshold limits as prescribed under the provisions of section 44AB of the Act first time only.

Subhag Projects Private Ltd vs ITO – 2022 TAXSCAN (ITAT) 981

The Cuttack bench of the Income Tax Appellate Tribunal (ITAT) has imposed a cost of Rs. 5,000 on the assessee for non-compliance of the notice received through the Income Tax Business Application (ITBA). A perusal of the order of the ld. CIT(A) shows that four opportunities have been granted to the assessee by issuing notices through ITBA System via e-Mail. It was submitted by the ld. AR that notices have been received but the assessee was unable to correspond with its counsel. This being so, we are of the opinion that the assessee should be granted another opportunity of being heard before the ld. CIT(A). This is however, subject to the levy of cost of Rs.5000/- (Rupees Five Thousand Only) payable under the head “Others” by the assessee before the AO and challan of the same be submitted to the ld.CIT(A). Thus, the issues in the appeal of the assessee are restored to the file of CIT(A) for readjudication after granting adequate opportunity of the assessee.

Trustline Securities Pvt. Ltd. vs DCIT – 2022 TAXSCAN (ITAT) 987

Income Tax Appellate Tribunal (ITAT), New Delhi deleted addition against share broker as pledging of shares of clients with banks for obtaining bank finance and for depositing margin money not violation of regulation of SEBI. The assessee furnished explanation vide letter dated 07.11.2016 that the pledge value of shares with Citi Bank as on 31.03.2014 (Rs. 11,70,78,543/-) included assessee’s ownshares as well as excess shares of clients. The overdraft facility is provided by the bank on the basis of total value of shares pledged with them.The explanation was not acceptable to the Ld. AO. He observed that the shares of clients cannot be pledged for obtaining loans and that confirmation from clients has not been submitted. He, therefore, added the value of difference in shares between book value and pledge value as income of the assessee reducing therefrom value of assessee’s own shares which worked out to Rs. 24,86,72,622/- as income from other sources

Mr.Naresh Chand vs Income Tax Officer – 2022 TAXSCAN (ITAT) 965

The Income Tax Appellate Tribunal (ITAT), Delhi Bench presided by Mr. Anil Chaturvedi, Accountant Member,and Shri N.K. Choudhry, Judicial Member has held that deduction u/s 54 EC is applicable within six calendar months from the date of transfer of property and not within 180 days. The Tribunal observed that under the provision the investment can be made as a whole or in part of the capital gains. As per section 54EC of the Act, the period of investment starts from the date of transfer and not from the date of receipt of consideration.By relying on the decision of Coordinate Benches of the Mumbai Tribunal in the case of Neela S. Karyakarte vs. ITO ‘six months’ means ‘six calendar months’ and not 180 days.

M/s Elphinstone Paper Box Manufacturing Co vs Jurisdictional Income-tax Officer – 2022 TAXSCAN (ITAT) 959

The Mumbai Bench of Income Tax Appellate Tribunal (ITAT) has held that exception to the Central Board of Direct Taxes (CBDT) circular specifying monetary limit for filing appeals not applicable to cases relating to information received from the investigation wing of the department. Mr. Om Prakash Kant (Accountant Member) and Mr. Sandeep Singh Karhail (Judicial Member) have observed that the Investigation Wing of the Income Tax Department based on the information from the Sales Tax Authorities conducted a search/survey on M/s Bigwin Paper Distributor Private Limited’ and ‘M/s Arun Paper and Iron Traders. During the action, it was found that they were engaged in providing entries of bogus sales to the assessee, and thereafter the Investigation Wing sent the information to the AO of the assessee that the assessee was engaged in receipt of bogus purchase bills.

Shri Venkatesharaiyer Subramanian vs ACIT – 2022 TAXSCAN (ITAT) 1004

The Chennai bench of the Income Tax Appellate Tribunal (ITAT) has held that the capital gain exemption under section 54F of the Income Tax Act, 1961 is allowable to separate independent liveable residential units on a single piece of land. Allowing the exemption, the Tribunal held that “In our considered opinion, there is nothing in the statutory provisions which debar the assessee to make separate independent livable units on a single piece of land or obtain more than one electricity connection to claim the deduction. There is also not a condition that the property should be, at all times, used exclusively by the owner himself for his own residential purposes and the same could not be let out. As long as the property is one residential house, the fragmentation of the same into different livable units and to let them in part would not make the assessee ineligible to claim the deduction. Accordingly, the lower authorities, in our considered opinion, has misconstrued the statutory provisions. We would hold that the assessee is eligible to claim the deduction on investment of Rs.249.98 Lacs which shall proportionately stand reduced to Rs.244.30 Lacs as held by Ld. AO in para-14 of assessment order in view of the fact that full sale consideration was not invested in the new house.”

M/s. A.D. Hydro Power Ltd vs DCIT –  2022 TAXSCAN (ITAT) 1005

The Delhi bench of the Income Tax Appellate Tribunal (ITAT) comprising Shri Challa Nagendra Prasad, Judicial Member and Shri Pradip Kumar Kedia, Accountant Member has held that the receipt from the sale of Carbon Credit is exempted under the normal provisions of the Income Tax Act, 1961 and shall not be included while computing book profit under section 115JB of the Income Tax Act, 1961. Holding in favour of the assessee, the Tribunal held that “It was further held that since the income/profits from the sale of Carbon Credits is essentially in the nature of capital receipts and it cannot be brought to tax under the provisions of minimum alternate tax under Section 115JB of the Act. While holding so the Tribunal followed the decision of the Jaipur Bench of the Tribunal in the case of Shree Cements Ltd. reported in 49 taxmann.com 274. We observe that the ld. CIT (Appeals) following the order of the co-ordinate bench of the Tribunal in the case of M/s. Malana Power Company Limited, which is the Holding company of the assessee decided the grounds in favour of the assessee holding that sale of Carbon Credits is capital receipt not exigible to tax under normal provisions of the Act and also while computing the book profits under Section 115JB of the Act, we see no infirmity in the order passed by the ld. CIT (Appeals).”

Roop Raj Hospitality (P) Ltd vs Income Tax Officer – 2022 TAXSCAN (ITAT) 962

The Delhi bench of the Income Tax Appellate Tribunal (ITAT) ruled that reassessment proceeding cannot be challenged if the assessee suppressed material facts by not filing an Income Tax Return. It was observed that the assessee has accepted the addition sustained by Commissioner (Appeals). Further observed that the assessee despite having income from operations to the tune of Rs.29,85,471/-, as shown in the profit and loss account furnished before Commissioner (Appeals), did not file any return of income under section 139(1) of the Act. The Assessing Officer had to complete the assessment ex-parte, to the best of his judgment under section 144 of the Act due to the non-compliance of the assessee and the Assessing Officer had tangible material available with him to indicate that the assessee had earned income, but it was not offered to tax.

Sujan Azad Parikh vs DCIT – 2022 TAXSCAN (ITAT) 1006

While deleting an addition of capital gain on account of transfer of shares as family arrangement, the Income Tax Appellate Tribunal (ITAT), Mumbai bench has held that a partition or family arrangement cannot be treated as “transfer” for the purpose of the Income Tax Act, 1961. Allowing the plea of the assessee, the Tribunal held that“there is no doubt that there is a family arrangement and based the condition specified in the order passed by CLB, the shares were transferred to the company on the buyback terms. In the given case, the transferor is an individual whereas in the case relied by the CIT(A) in which the transferor is the legal entity. As held in the case of R Nagaraja Rao (supra), the Hon’ble Karnataka High Court observed that Partition or family settlement is not transfer. When there is no transfer there is no capital gain and consequently no tax on capital gain is liable to be paid.”

Tardevi Jyoti Kumar Bubna vs DCIT – 2022 TAXSCAN (ITAT) 1007

The Income Tax Appellate Tribunal (ITAT), Mumbai bench, while considering a grievance of the assessee regarding denial of TDS credit due to holding of two PAN cards, has directed the department to cancel one PAN card and allow the TDS credit as per the law. A division bench of the Tribunal comprising Shri Vikas Awasthy, Judicial Member & Shri M.Balaganesh, Accountant Member observed that“this matter requires factual verification by the ld. AO and one of the PAN of the assessee should be cancelled by the Income Tax department and credit for advance tax and TDS should be granted to the assessee as per law. Hence, we deem it fit to remand this issue to the file of the ld. AO for denovo adjudication. Accordingly, the grounds raised by the assessee are allowed for statistical purposes.”

Shri Jagdishbhai R. Patel vs ACIT Cent.Cir.1(2) 2022 TAXSCAN (ITAT) 1008

The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench has held that the cash seized during search cannot be adjusted against the self-assessed existing tax liability as per the provisions of section 132B of the Income Tax Act, 1961. While dismissing the appeal preferred by the assessee, Smt.Annapurna Gupta, Accountant Member and Shri Siddhartha Nautiyal, Judicial Member observed that the “penalty @ 30% was required to be levied as per the section on account of the above failure of the assessee. The Ld.CIT(A) rejected both the contentions of the assessee of treating belated return filed u/s 139(4) of the Act as being filed u/s 139(1) of the Act and treating cash seized to be treated as adjusted against taxes due thus tant amounting to taxes also being paid by the assessee on the undisclosed income by the specified date.

Siddhartha Academy of General & Technical Education vs Asst. Commissioner of Income Tax – 2022 TAXSCAN (ITAT) 816

If identity of donors is established U/s115BBC money received cannot be considered as anonymous donations so was held by the Income Tax Appellate Tribunal (ITAT), Visakhapatnam. Duvvuru RL Reddy, Judicial Member and S Balakrishnan, Accountant Member observed that “We are of the considered view that the assessee has established the identity of the donors as provided U/s. 115BBC of the Act and hence the donations received by the assessee cannot be categorized asanonymous donations and cannot be subjected to tax as per the provisions of section 115BBC of the Act. We therefore, find no infirmity in the order of the CIT and no interference is required.”

Shri Jangpal Singh Tanwar vs Pr. CIT-1 – 2022 TAXSCAN (ITAT) 885

The Chandigarh Bench Income Tax Appellate Tribunal (ITAT), has deleted the revision order passed u/s 263 based on presumption. The Coram of Smt. Diva Singh, Judicial Member,andMr. Vikram Singh Yadav, Accountant Member have observed that the entire Long Term Capital Gain from the sale of the property has been applied to the new property. Documents substantiating the claim are available on record and have not been upset, thus the revisionary power u/s 263 of the Act cannot be allowed to be exercised in a casual arbitrary manner.The presumption that the assessee’s wife and son had 1/3rd share each is an inference based on no facts. The PCIT has to point out the error in the order and that too such an error can be said to be prejudicial to the interests of the Revenue.

Sangitaben Chetankumar vs ITO –  2022 TAXSCAN (ITAT) 877

The Ahmedabad Bench of Income Tax Appellate Tribunal ( ITAT ) has held that inadequate opportunity for hearing in appeal proceedings and remand matter back to Commissioner Income Tax (Appeal) for fresh adjudication. The Tribunal has held that “the CIT(Appeals) passed ex parte order confirming the additions made by the Assessing Officer. In our view, in the interests of justice, we are restoring the matter to the CIT(Appeals) for adjudication of the case on merits after giving opportunity of hearing to the assessee”.

M/s. Akash Infra Projects P. Ltd vs ITO–  2022 TAXSCAN (ITAT) 866

While considering a bunch of appeals filed by the assessee, the Ahmedabad bench of Income Tax Appellant Tribunal, comprising Ms Annapurna Gupta, Accountant Member and Shri Mahavir Prasad, Judicial Member has held that the business of infrastructure development comes under the definition of developer and allowed the deduction claimed u/s 80IA (4) of Income Tax Act,1961. It was observed that the tender documents clearly show that the assessee has to arrange their own finances, purchase their own plant & machinery and purchase all materials at their own cost, and deploy qualified personnel for construction and development of infra projects. The assessee claimed depreciation on plant and machinery as it has been used for the development of infrastructure facility projects.

Atharva Polymers Private Limited vs The Dy.Commissioner of Income Tax –  2022 TAXSCAN (ITAT) 1010

The Income Tax Appellate Tribunal (ITAT), Pune has ruled that, Subsidy is not to be reduced from the actual cost of fixed assets under Section 43(1) for purpose of calculation of depreciation. The Bench consisting of S S Godara, Judicial Member, and Dr. Dipak P Ripote, Accountant Member observed that Subsidy shall not be reduced from the actual cost of fixed assets u/s 43(1) for the purpose of calculation of depreciation, and the AO is directed to delete the addition of depreciation.”

ACIT vs M/s. Emcipi Electronics Pvt. Ltd – 2022 TAXSCAN (ITAT) 1009

The Income Tax Appellate Tribunal ( ITAT ) has held that, Expenditure resulting in income or substantial income not necessary for granting deduction for business purposes. The Bench consisting of B R R Kumar, Accountant Member and Yogesh Kumar U S, Judicial Member held that “The issue of quantum of income and allowableness of the expenses it has to be seen that, whether the expenditure incurred wholly and exclusively for the purpose of business or not. So long as the expenses are incurred for the purpose of business, in our opinion the same should be allowable as deduction and it is not necessary that the expenditure may result in income or there must be substantial income. The said view has been supported by the decision of Hon’ble Supreme Court in the case of CIT Vs. Malayalam Plantation Ltd. and CIT Vs. Rajinder Pd. Modi.”

Shri Arunkumaar Thakurprasad Oza vs ITO – 2022 TAXSCAN (ITAT) 1012

The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench has held that the loan amount obtained by the assessee from his friends out of their labour work income cannot be dismissed by the income tax department as “unbelievable” as per the provisions of the Income Tax Act, 1961. A bench of Smt. Annapurna Gupta (Accountant Member) and Shri Mahavir Prasad (Judicial Member) observed that “the assessee had given complete list of his friends from whom loans were taken, and it is evident from the same that he had taken very small amount of loan ranging from Rs.3,000/- to Rs.15,000/- and all the details regarding his friends from whom loan had been taken by the assessee was given to the AO who had issued summons to them and in respect of which, two persons had confirmed having given loan to the assessee. Considering that loans were taken for the purpose of carrying out share trading transactions, which is an accepted fact and were of very small amounts and two persons have confirmed giving loan, we see no reason to treat the loans as unexplained.”

Ishwarsingh Ramchandra Jangid vs Income Tax Officer –  2022 TAXSCAN (ITAT) 1013

The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench in view of the negligent, casual and non-compliant behaviour of the assessee, has refused to condone a delay of 789 days. A division bench of Shri P.M. Jagtap (Vice-President) and Shri Siddhartha Nautiyal (Judicial Member) observed that there was non-compliance on the part of the assessee to the notices issued by the Assessing Officer during the course of assessment proceedings as well as to the notices issued by the learned CIT(A) during the course of appellate proceedings resulting into passing of exparte orders by them.

Strategic Infosystems Pvt. Ltd vs DCIT – 2022 TAXSCAN (ITAT) 875

The Income Tax Appellate Tribunal ( ITAT ) Ahmedabad Bench has held that credit of Dividend Distribution Tax (DDT) paid denied on technical default and directs revenue to correct data uploaded in Online Tax Accounting System (OLTAS) database and grant credit of Dividend Distribution Tax (DDT). The Tribunal observed that the assessee has already approached the CPC thrice and also approached CIT(Appeals) for redressal of its grievance and there is no denying that the assessee has paid and deposited DDT within the due date.

Samir Kishor Parekh vs The ACIT –  2022 TAXSCAN (ITAT) 871

The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench consisting of Waseem Ahmed, Accountant Member and Siddhartha Nautiyal, Judicial Member held that no addition can be made on estimated basis, without rejecting books of account of assessee. ITAT held that “The additions have been sustained by CIT on purely estimate basis, as is evident from the observations made by Ld. CIT(Appeals) while passing the appeal order. It is well-settled law that no addition could be made on estimated basis without rejecting books of account of assessee.”

Deputy Commissioner of Income Tax vs Marubeni Corporation – 2022 TAXSCAN (ITAT) 860

The Mumbai Bench of Income Tax Appellate Tribunal ( ITAT ) has upheld a lower tax rate on interest income under Article 11(2) of the Indo-Japanese tax treaty since no connection between interest income and permanent establishment (PE). The Tribunal relied on its own decision in DCIT vs Marubeni Corporation, Japan. It was held that “we see no reasons to take any other view of the matter than the view so taken by the co-ordinate bench. Respectfully following the same, we approve the conclusions arrived at by the learned CIT(A) and decline to interfere in the matter”.

Sh. Srijal Gupta vs Income Tax Officer – 2022 TAXSCAN (ITAT) 1016

The Amritsar bench of the Income Tax Appellate Tribunal (ITAT) has held that the cash deposit of the Firm cannot be added to the personal income of the Partner without investigating the same from the hands of the Firm. After hearing arguments from both sides, a bench consisting of Dr. M. L. Meena (Accountant Member) and Sh. Anikesh Banerjee (Judicial Member) has observed that the reopening was made u/s. 148 related to purchase of property amount to Rs.9,53,750/-.

Koshambh Charitable Trust vs The ACIT – 2022 TAXSCAN (ITAT) 1014

The Ahmedabad bench of Income Tax Appellate Tribunal (ITAT) comprising Shri Waseem Ahmed, (Accountant Member) and Shri T.R. Senthil Kumar (Judicial Member) has observed that the National Faceless Appeal Centre (NFAC) has refused to condone delay without a detailed order and therefore, directed the department to re-adjudicate the appeal. The division bench, after persuing the arguments and documents, observed that “As it can be seen from the Income Tax portal relating to the Assessment Year 2016-17, the date of service of u/s. 143(1) is said to be Nil and also mode of service also Nil. Thus, having not been served with the 143(1) order, only when certified copy was obtained from the department on 08.01.2020 and thereafter the assessee filed the appeal on 05.02.2020. Thus, there is no delay on the part of the assessee in filing such appeal. However, NFAC without appreciating the above facts has simply dismissed on the ground no “sufficient cause” was made on behalf of the assessee.”

The Income Tax Officer vs M/s.67th Annual Conference of CSI-2015 –  2022 TAXSCAN (ITAT) 1020

The Delhi bench of the Income Tax Appellate Tribunal (ITAT) has held that surplus generated from trust can’t be added to the income of assessee Association Of Person (AOP). The Tribunal consists of Shri Mahavir Singh, vice president and Shri G Manjunatha, accountant member while confirming the order of CIT(A) observed that the excess amount collected by assessee AOP for organizing a conference can be held as the amount in trust, not to be held as the income of the assessee and dismissed the appeal.

Vishwanath Ramchandra Panvelkar vs DCIT – 2022 TAXSCAN (ITAT) 1021

The addition of unexplained cash is not sustainable when the primary onus was discharged by sufficient evidence, the Mumbai bench of the Income Tax Appellate Tribunal(ITAT) set aside the order of addition under section 68 of the Income Tax Act. The assessee furnished various details on appeal before CIT(A) who remanded the matter to the AO. The AO held that the amount of Rs.2,11,99,999/- claimed to have been received from M/s Samarth Enterprises was unexplained cash credit and is taxable as a gift in the hands of the assessee under section 56(2) of the Act.  The CIT(A) confirmed the addition made u/s 68 of the Act.

Triune Energy Pvt Ltd vs DCIT –  2022 TAXSCAN (ITAT) 1022

The Delhi bench of the Income Tax Appellate Tribunal (ITAT) comprising Shri Ani Chaturvedi, Accountant Member and Shri Anubhav Sharma, Judicial Member held that the absence of specifying the limp, in the notice issued, invalidates the penalty. It was observed that the notice issued u/s 274 read with section 271 of the Act itself was ambiguous as it did not make it clear as to under which limb section of 271(1)(c) of the Act the notice was issued.

M/s. Sundaram Infotech Solutions Ltd vs ITO – 2022 TAXSCAN (ITAT) 1018

  The Income Tax Appellate Tribunal ( ITAT ) held that lease charges paid for the use of the asset, without acquiring any ownership rights in the same, are allowable as revenue expenditure under Section 37 of the Income Tax Act,1961. The Tribunal observed that ownership of the leased assets remains with the lessor and the lease rentals paid by the assessee are allowable as revenue expenditure for the reasons stated in our adjudication as above.

Satya Prakash vs ITO – 2022 TAXSCAN (ITAT) 1019 – 2022 TAXSCAN (ITAT) 1019

The Delhi bench of the Income Tax Appellate Tribunal (ITAT) comprising Shri Challa Nagendra Prasad, (Judicial Member) & Shri Pradip Kumar Kedia (Accountant Member) has imposed a cost of Rs. 2000 on the assessee for neglected the income tax notices. The bench observed that the assessee has failed to appear before the Assessing Officer in the assessment proceeding resulting in ex-parte additions on estimated basis towards cash deposits of Rs.17,12,090/-.The assessee has also failed to appear before the CIT(A).

M/s. Orchid Foundations Pvt. Ltd. vs ITO –  2022 TAXSCAN (ITAT) 1017

The Chennai bench of the Income Tax Appellate Tribunal (ITAT) has held that eviction charges paid are allowable as business expenditure. The Tribunal observed that the assessee was into the business of real estate development and such expenditure would fulfil the test laid down u/s 37(1) and the expenditure incurred for business purposes of the assessee was well proven by the documentary evidence in support of the claim.

 M/s. TULIP INFRATECH PRIVATE LIMITED vs Addl. CIT – 2022 TAXSCAN (ITAT) 1019

The Delhi bench of the Income Tax Appellate Tribunal (ITAT) held that penalty u/s 271C of the Income Tax Act,1961 based on mere assumption without supporting evidence is not sustainable hence it is invalid. The AO held that there is no time limit for initiation of penalty, and for the imposition of penalty u/s 271C, order u/s 201(1)/201(1A) is not necessary and imposed a penalty and on appeal, the CIT(A) dismissed the same.

Shri Rajkumar Tiwari vs Income Tax Officer – 2022 TAXSCAN (ITAT) 1015

The Income Tax Appellate Tribunal (ITAT), Ahmedabad bench has imposed a cost of Rs. 5000 on the assessee considering the negligent and causal approach during the assessment proceedings under the Income Tax Act, 1961. Allowing this argument, the bench held that “We are inclined to accept this contention of the learned DR. We accordingly impose a cost of Rs.5000/- [Rs. Five Thousand Only] on the assessee and subject to the payment of the said cost to the Prime Minister’s Relief Fund, we restore the matter to the file of the Assessing Officer for deciding the same afresh on merit in accordance with law after giving proper and sufficient opportunity of being heard to the assessee.”  2022 TAXSCAN (ITAT) 1011

M/s. Daeseung Autoparts India Pvt.Ltd vs The Assistant Commissioner of Income Tax 2022 TAXSCAN (ITAT) 1011

Income Tax Appellate Tribunal (ITAT), Chennai bench consisting of V Dura Rao, Judicial Member and G Manjunatha, Accountant Member dismissed the appeal filed by M/s. Daeseung Autoparts India Pvt. Ltd on the claim for additional depreciation on capitalized portion of forex loss for plant and machinery. The Tribunal observed that “Arguments of the assessee is misplaced, because as per provisions of section 32(1) (iia) of the Act, the assessee is entitled for additional depreciation only in the year of acquisition and installation of new plant & machinery, but not for subsequent financial years. Although, provisions of section 43A of the Act allows capitalization of forex loss incurred on acquisition of plant & machinery outside India to cost of assets, but said additional cost can only be eligible for normal depreciation as per provisions of section 32(1) of the Act, but not for additional depreciation as contemplated under section 32(1) (iia) of the Act. Hence, dismiss appeal filed by the assessee.”

Smt. Sunita Goyal vs The Pr. CIT – 2022 TAXSCAN (ITAT) 993

The Chandigarh Bench of Income Tax Appellate Tribunal(ITAT) has held that mere suspicions of Principal Commissioners of Income Tax (PCIT) cannot be the basis for initiation proceedings under section 263 and quashes revisional order. The Tribunal observed that the suspicions of the PCIT cannot be the basis for setting aside a validly passed assessment order. Law requires the PCIT to meet the twin conditions of pointing to the error in the order passed and that too such an error which can be termed to be prejudicial to the interests of the Revenue.

Tangar Exports LLP vs ACIT – 2022 TAXSCAN (ITAT) 1024

The Chennai bench of the Income Tax Appellate Tribunal (ITAT), has held that debatable issues cannot be adjusted on mere intimation u/s 143 and allows deduction u/s.80JJAA. The Coram of V. Durga Rao, Judicial Member,and Mr. G. Manjunatha, Accountant Member observed that the issue is highly debatable which can be resolved by deliberation, including verification of necessary documents and the Assessing Officer cannot make adjustments towards deduction u/s.80JJAA of the Act, while processing return u/s.143(1) of the Income Tax Act, 1961.

Dharmapuri District Central Co-operative Bank Ltd vs ACIT – 2022 TAXSCAN (ITAT) 1023

The Income Tax Appellate Tribunal (ITAT), Chennai has held that rural advances consolidated and shown in Head office accounts are eligible for deduction as Bad and Doubtful Debts u/s 36(1)(viia). The Authority observed that the assessee does not make any such advances at the Head Office level and all such transactions were affected at the branch level only. It was only for management control, that the primary agricultural cooperative societies advanced functioning at the village level were consolidated and shown as Head office accounts in the financial statements.

M/s.Dhanalakshmi Mills Ltd vs The Deputy Commissioner of Income Tax 2022 TAXSCAN (ITAT) 1028

The Chennai bench of the Income Tax Appellate Tribunal (ITAT), held that if AO failed to rightly compute capital gain on the sale of the land then the revisional jurisdiction of PCIT will sustain and uphold the revisional order. The Tribunal observed that the AO has failed to apply his mind in light of the facts of the case to relevant provisions of section 50C of the Act while completing the assessment and the PCIT has rightly exercised jurisdiction u/s.263 of the Act.

Macro tech Developers Ltd. vs DCIT –  2022 TAXSCAN (ITAT) 1036

The Income Tax Appellate Tribunal (ITAT), Mumbai Bench held that accepting loans through journal entries with reasonable cause will not attract penalty u/s 271D of the Income Tax Act,1961. Shri Aby T Varkey, JM and Shri Gagan Goyal, AM viewed that there was reasonable cause for assessee netting off/assigning off the debt against liabilities through journal entries u/s 269SS/269T of the Act and held that “thought the appellant has violated the provisions of section 269SS of the Act in respect of journal entries, it has shown reasonable cause and therefore, the penalty under section 271D is not leviable.”

Ahmed World Travels Tours & Cargo Pvt. Ltd. vs The Assistant Commissioner of Income Tax 2022 TAXSCAN (ITAT) 1034

The cash paid by the forex dealers for the purchase of foreign currency can be exempt as per 6 DD(1) of the Income Tax Act,1961, the Chennai bench of the Income Tax Appellate Tribunal (ITAT) held as above. The Assessing Officer observed that the assessee has paid cash for hotel expenses, whereas the assessee claims that it has paid cash for the purchase of foreign currency and expenditure has been incurred in foreign currency by its customers.

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Lottery Validation In India – Abrupt Overview!

The laws and norms governing lotteries in India are not clear-cut or absolute. Although several Indian States have legalized lotteries, there is no general prohibition. As an outcome, it is up to the state governments to create legislation that governs, authorizes, and levies taxes on lotteries.

Furthermore, according to a recent clarification by the NITI Aayog, fortunate drawings intended to promote digital transactions do not fall within the definition of a lottery and are thus not prohibited.

Indian Laws About Lotteries

The Lotteries Act, 1998 and the Lotteries Rules, 2010, which effectively provide rules for lotteries’ structure, behavior, and other aspects, control lotteries in India. 

The lottery is defined as “a program, in whatever shape and by name named, for distribution of prizes by lot or opportunities to those people participating in the chances of a win by buying tickets” under Section 2(b) of the cited Act.

A lottery organized, operated, or marketed in violation of the terms of the relevant Act is prohibited under Section 6 of the Act mentioned above, and Section 7 deals with the associated penalties.

According to Section 294A of the Indian Penal Code, 1860, anyone who maintains an office or other location to conduct a lottery that is not a State lottery or a lottery authorized by the State Government will be punished with up to six months in prison, a fine, or a combination of the two.

Agreements made by wagering are invalid, according to Section 30 of the Indian Contract Act of 1872. The Consumer Protection Act also forbids holding any lottery, game of chance, skill, or contest to directly or indirectly promote purchasing, using, or supplying any product or commercial interest.

Overview Of Tax And Lottery

Lottery play is considered gambling. Therefore, if you were to win large, the money would be regarded as gambling revenue, with all the consequences described above. 

When we talk about a tax on lottery winnings, Federal tax withholding of 24 percent is automatic on jackpot payouts exceeding $5,000 less the wager. Most states also impose taxes, and dependent on your other income and where you reside, your overall tax burden might reach 50%. 

There are no continuing expenses if you win the lotto, unlike buying a home or a vehicle. If you wish to receive your winnings as an annuity, you will naturally have to pay yearly income taxes; more below.

Legal Conditions Of Lottery In India. 

Now, 13 states have legally approved the online lottery in India. Each of these Indian States has a lottery department often overseen by the government of India’s finance department. And also, there are government wins lottery as well. 

They have their plans and drawings on certain days and at predetermined times. The draws are conducted publicly using massive lottery machines that randomly produce the winning numbers. 

The lottery is legal in the state of Arunachal Pradesh.

The laws and norms governing lotteries in India are not clear-cut or absolute. Although the several Indian States have legalized lotteries, there is no general prohibition on them.

As an outcome, it is up to the state governments to create legislation that governs, authorizes, and levies taxes on lotteries.

Each of these Indian States has a lottery department often overseen by the government of India’s finance department.

They have their plans and drawings on certain days and at predetermined times. The draws are conducted publicly using massive lottery machines that randomly produce the winning numbers.

Goa- the lottery is permitted.

The lottery is very well-liked in Goa, where it is legal, and there are three daily drawings in addition to several special “bumper” draws. 

The results are accessible on several websites and unlicensed applications, similar to most Indian state lotteries; however, tickets may only be purchased offline from authorized distributors.

The lottery is legal in Madhya Pradesh.

It is another state that permits gambling and is becoming more and more well-liked. Brightly colored lottery tickets can be purchased at several stands along major thoroughfares. 

Some people have condemned the lottery for breaking state laws and selling tickets from drawings in other states.

The lottery is permitted in Maharashtra.

After the Kerala State Lottery’s triumph in 1969, one of the first to be created was the Maharashtra State Lottery. 

One of the main prominent reasons for its development was to lessen the prevalence of illegal gambling schemes. 

And matka offers a reliable alternative where the money raised benefits the neighborhood by enhancing agriculture, health, education, women’s and children’s welfare, and other charitable endeavors.

Manipur: the lottery is permitted

After being deemed unlawful for a while, Manipur restored its state lottery’s legal status.

Meghalaya: the lottery is legal

With seven daily drawings, the state of Meghalaya has operated a legalized lottery for more than 20 years. 

All results are available online, but only authorized distributors at kiosks or lottery offices are allowed to sell tickets.

Mizoram -the lottery is lawful.

In Mizoram, where lotteries were made legal in 2010, the rules are slightly different from those in Kerala, with less expensive tickets and lower top rewards. 

India’s Lottery-Banned States

Fifteen of India’s 28 states have outlawed the lottery. In addition, none of the eight Union Territories permit the activity. 

These states don’t each have their state lottery. Some of them, like Delhi, which formerly ran State lotteries, have outlawed it.

In several other states, the purchase, transfer, or sale of lottery tickets purchased in another state is forbidden.

Others, like Delhi and Haryana, have elected to keep their doors open in the meanwhile.

In a word, the regulations governing lotteries in India are appropriately described as “to each his own.”

In India, Online Lottery Legal?

This question does not have an easy solution. The legality of the online lottery might be a little unclear for those who want to play online due to the nature of the country’s lottery legislation. However, we shall try to clarify what we know about India’s legitimate online lottery.

Make sure the selected lottery website satisfies these two requirements before you begin playing the online lottery in India. The online lottery platform must have its headquarters outside of India.

Only lotteries headquartered outside the nation are recognized as lawful, as we’ve previously established. As a result, we should only utilize lottery websites that offer tickets for foreign lotteries. Avoid buying tickets from phony Indian websites that advertise the Kerala or Punjab lottery!

The online lottery must allow legitimate Indian payment options.

An excellent rule of thumb is to only wager via online lotteries that support secure payment options to protect your personal information and money. 

Never enter critical financial data on any website, such as PINs or CVV numbers, since doing so might put your finances in danger. Use online lotteries that offer payment alternatives instead, such as:

Conclusion

You may be wondering whether gambling is permitted in India. The truth is that 13 of India’s 29 states lawfully allow lottery participation. It hasn’t yet been legalized in certain regions, but that might change in the next years. 

As a result, many lottery sites offer domestic and foreign lotteries for players in approximately half the country. And also, gambling regulations vary from state to state and are based on local customs and history. 

Since each state decides whether or not to legalize lotteries, gambling is not prohibited in India.

The 13 Indian states have legalized lotteries, and the remaining 16 Indian states do not allow lotteries. It is permissible to play the lotto online using a foreign-based supplier.

ICAI hikes Course Fee for IT and Soft Skills Training Applicable from August

The Institute of Chartered Accountants of India (ICAI) has restored the course fees for the classes of IT and Soft Skills Training as per the prescribed fees during pre-Covid times.

Due to the waning cases of COVID and relaxation of the various restrictions, ICAI has decided to organize the classes of ICITSS & AICITSS courses in physical mode at the Branch /Regional Level for all eligible students.

In view of the above, the competent authority of the Institute has decided to restore the course fees of IT and Soft Skills courses of ICITSS & AICITSS to original fees of Rs 7000 for OC & MCS each, Rs 6500 For ITT & Rs 7500 for Advanced ITT due to resumption of classes in physical mode.

“The increase fees of IT & Soft Skills courses would be effective from 1st Aug 2022 i.e., the batches which will be launched / starting on and after 1st August 2022, the students are required to pay increased fees as per the point no. 1,” the Institute said in a statement.

“The students who have already registered in the said batches starting on and after 1st August 2022 on the portal, shall be allowed to continue with the reduced fees only,” the ICAI said.

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Should I Pay Off My Credit Card Debt With a Personal Loan?

A personal loan is a credit facility that you can avail from a financial institution to satisfy your financial requirements. You can use the money borrowed to pay for a wedding, make a big purchase or even to meet any medical bills.

However, some individuals apply for a personal loan online to pay off other debt obligations such as their credit card debt. But then, is that a wise move and should you resort to it as well? Or is it financially detrimental?

If you’re trying to find answers to these questions, then here’s some information that can help bring some much-needed clarity.

How is a Personal Loan Debt Different From a Credit Card Debt?

You incur a credit card debt only when you don’t pay the entire outstanding bill amount within the due date. Paying just the minimum amount due on your credit card or making just a partial payment can lead to an accumulation of debt on your credit card.

That’s not all. The unpaid outstanding amount on your credit card will start to accrue interest till the time you decide to pay it off. Usually the rate of interest on unpaid credit card outstandings is around 2% to 4% per month, which translates to 24% to 48% per year. As you can see, the rate of interest on credit card debt is significantly high.

On the other hand, the typical rate of interest on a personal loan is only somewhere around 12% to 16% per annum, which is around half of the interest on a credit card debt. This is one of the major differences between a personal loan debt and a credit card debt.

Should You Pay Off Your Credit Card Debt With a Personal Loan?

Now that you’ve seen how different credit card debt and a personal loan debt is, let’s take a look at whether you should use a personal loan to pay off your other debt. This practice is known as debt consolidation, which is a strategy where you avail a low-interest loan to pay off all your high-interest debts.

This way, not only can you save on interest and lower your financial burden, you can also consolidate multiple debts into fewer ones. And considering the fact that the interest rates on a credit card debt are almost always higher than the cost of a personal loan, you could choose to pay off credit card debt using a low-interest personal loan.

This way, you can not only enjoy lower interest payments, but also are likely to be left with more money in hand, which you can use to pay off your personal loan obligations much faster.

Things to Consider When You Use a Personal Loan To Pay Off Credit Card Debt

All said and done, before you go ahead and apply for a personal loan online, here are a few financial things that you should consider.

1.       Opt For a Lender Who Offers The Lowest Interest

There’s no point in opting for a lender who offers the loan at high rates of interest since it would defeat the entire purpose of using a personal loan to pay off your credit card debt. So, before you apply for a personal loan online, make sure to pick a lender who offers the lowest interest.

2.       Choose the Repayment Tenure Wisely

A longer repayment tenure can lower your monthly EMI obligations, but would increase the total amount of interest that you pay over the tenure. So, selecting the right repayment tenure is another major thing that you should pay attention to.

Conclusion

As you can see, a credit card debt can be more damaging to your financial situation than a personal loan. Opting to pay it off using a personal loan is a good option that you can pursue.

That’s not all. If you’re stuck with a high interest personal loan, you can use the personal loan balance transfer feature to switch to a more lenient lender that offers low rates of interest and at better terms and conditions to reduce your overall debt as well.

GST Return: CBIC releases Concept Paper Comprehensive Changes in GSTR-3B, Invites Suggestions

The Central Board of Indirect Taxes and Customs (CBIC) has released a Concept Paper on the comprehensive changes proposed in the form GSTR-3B and invited comments and suggestions from the stakeholders.

A proposal of comprehensive changes in FORM GSTR-3B was deliberated by the GST Council in its 47th meeting held at Chandigarh on 28th and 29th June 2022. The Council recommended that the said proposal may be placed in public domain for seeking inputs and suggestions of the stakeholders.

“Accordingly, the general public and the trade at large are hereby informed that a detailed Concept Paper on comprehensive changes in FORM GSTR-3B is enclosed. All members of the trade/ stakeholders are requested to kindly furnish their views/comments/suggestions on the Concept Paper latest by 15th September 2022 at gstpolicywing-cbic@gov.in so as to facilitate finalization of the matter,” the CBIC stated in a statement.

For more details, click here:

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