Senior Advocate of Supreme Court of India and Former Union Finance Minister and Corporate Affairs Miniter Arun Jaitley dies at 66. He was undergoing treatment at AIIMS New Delhi since August 9.
Arun Jaitley (28 December 1952 – 24 August 2019) was an Indian politician and attorney, who was the Minister of Finance and Corporate Affairs of the Government of India from 2014 to 2019.
A member of the Bharatiya Janata Party, Jaitley previously held the cabinet portfolios of Finance, Defence, Corporate Affairs, Commerce and Industry and Law and Justice in the Vajpayee government and Narendra Modi government. From 2009 to 2014 he served as the Leader of the Opposition in the Rajya Sabha. He was a Senior Advocate of the Supreme Court of India. Arun Jaitley decided not to join the Modi Cabinet in 2019 due to health issues and died in August 2019.
On 26 May 2014, Jaitley was selected by newly elected Prime Minister Narendra Modi to be the Minister of Finance, the Minister for Corporate Affairs and the Minister of Defence, in his cabinet.
During his tenure as the Finance Minister of India, the government demonetized the ₹500 and ₹1000 banknotes of the Mahatma Gandhi Series, with the stated intention of curbing corruption, black money, fake currency, and terrorism from 9 November 2016.
On June 20, 2017, he reaffirmed that the GST rollout is well and truly on track.
On May 29, 2019, in a letter to Prime Minister Modi, Arun Jaitley cited his health as a reason for not taking an active role in the formation of the new government, effectively declining a role as a minister in the second term of Prime Minister Modi.
The Income Tax Appellate Tribunal (ITAT), Mumbai has held that the payment made to the legal heirs of deceased partners towards share in goodwill is allowable as a deduction under the Income Tax Act, 1961 since the revenue, in the earlier years, had allowed the same.
During the course of the assessment proceedings, the Assessing Officer observed that the assessee-Firm has claimed a deduction of an amount of Rs. 1,57,32,275, towards payment made to legal heirs of deceased partners called upon the assessee to explain why the deduction claimed, should not be disallowed.
The assessee claimed that as per the terms of the partnership deed, the assessee has to pay 5% of the net profit to the retired partners or the legal heirs of the deceased partners on account of the goodwill of the partners. It was submitted since the payment made was for the purpose of business it has to be allowed as an expenditure.
However, the Assessing Officer did not find merit in the submissions of the assessee and disallowed the deduction claimed.
The Tribunal held that the allowability of payment made to the legal heirs of deceased partners towards share in goodwill is a recurring issue between the parties continuing from the preceding assessment years.
“Though the Assessing Officer in the preceding assessment years has made similar disallowance, however, when the issue came up for consideration before the Tribunal, it was held that the payment made to the legal heirs of the deceased partners is allowable as a deduction. In the latest order passed for the assessment year 2011–12 cited supra, the Tribunal following its earlier orders has upheld the decision of learned Commissioner (Appeals) in allowing assessee’s claim of deduction,” the Tribunal said.
Subscribe Taxscan Premium to view the JudgmentThe Chennai bench of the Income Tax Appellate Tribunal ( ITAT ) has held that Remuneration paid to the partners cannot be disallowed for want of Registration of Firm.
The assessee, M/s. Tulip Valves and Controls is a Partnership Firm engaged in the business of manufacturing and assembling of valves. The return filed by the assessee was initially accepted by the Assessing Officer. Later, the assessment was re-opened on the basis of the information that income had escaped assessment to tax. The Officer, while concluding the proceedings, held that the partnership was not registered and therefore, the deduction cannot be granted towards the payment of remuneration to the partners.
The assessee, on the other hand, contended that the remuneration to the partners cannot be disallowed for want of registration of partnership firm.
While granting relief to the assessee, the Tribunal observed that “there is no requirement under the law that the partnership firm should be duly registered under the Partnership Act. Therefore, remuneration paid to partners cannot be disallowed for want of registration of the firm. Accordingly, we direct the Assessing Officer to allow the remuneration paid to partners of Rs.5,50,000/-.”
The Mumbai bench of the Income Tax Appellate Tribunal (ITAT) has held that the late fee under Section 234E of the Income Tax Act, 1961 is not leviable for the TDS statements which had been filed prior to 1st June 2015.
the Assessing Officer found that the due date for filing the quarterly TDS and the date on which the TDS statement was filed by the assessee with delay. However, the penalty under section 234E of the Act has also been reflected there. After the due date for filing the quarterly TDS statement, the penalty/fee is leviable u/s 234E of the Act for each day’s default.
The assessee argued before the Tribunal that the late fee u/s 234E of the Income Tax Act is not leviable under the provisions of Section 234E, 200A (a,b,c,d,e and f) and also in view of the provisions of Section 200 (3) of the Act. It was also argued that the provisions of Section 200(3) of the Act speak that for late filing of the TDS statement of each quarter, the fee is liable to be imposed w.e.f. 01.04.2005 and the provisions of Section 272A(2)(k) of the Act provide for levy of penalty of Rs.100 per day for each day of default in filing TDS inserted w.e.f. 01.04.2005.
The assessee failed to secure relief from the first appellate authority and approached the Tribunal on the second appeal.
On the basis of various judicial precedents including the Karnataka High Court ruling in case of Fatheraj Singhvi, the Tribunal held that “the finding of the CIT(A) is not justifiable, therefore, we set aside the finding of the CIT(A) in all the appeals and delete the fee u/s 234E of the Act. All the appeals filed by the assessee are hereby allowed.”
Subscribe Taxscan Premium to view the JudgmentThe Ministry of Corporate Affairs (MCA) has issued a circular today clarifying the import of section 232(6) of the Companies Act, 2013, which deals with the requirement of indicating an “appointed date” in the scheme of mergers and amalgamations, which would also be the effective date of the merger/amalgamation coming into force.
A view was being taken in some quarters that the “appointed date” in the scheme need always be a definite calendar date, which led to difficulties for companies intending to give effect to their merger at a future/event-linked date, based on business considerations, fulfilling legal requirements such as procurement of license from sectoral regulators, etc. Besides this, IndAS 103 (Business Combinations), which deals with the accounting treatment, uses the expression “acquisition date”, as a date when the acquirer takes control of the acquiree, also required clarification.
The circular clarifies that the companies may choose the “appointed date” of the merger/amalgamation based on the occurrence of an event, which is relevant to the merger between companies. This would allow the companies concerned to function independently till such an event is actually materialised. The circular further clarifies that the term “appointed date” used in section 232(6) shall be deemed to be the “acquisition date” for the purpose of conforming to IndAS 103 standard dealing with business combinations.
This clarification would lead to the harmonisation of practices in ascertaining the “appointed date” of merger/amalgamation and provide due clarity on the accounting treatment, thereby allowing stakeholders to align the “appointed date” of merger/amalgamation in accordance with their business considerations or legal requirements. This would also contribute significantly to the Ease of Doing Business.
Subscribe Taxscan Premium to view the JudgmentThe demise of the Chartered Accountant of the assessee cannot be a ‘reasonable cause’ for not auditing books of accounts under the Income Tax Act, 1961, said the Cochin bench of the Income Tax Appellate Tribunal (ITAT).
In the instant case, no audit report has been filed for the assessment year 2009-2010. It is the contention of the assessee that there was a reasonable cause as mandated under Section 273B of the Income Tax Act.
The assessee contended that consequent to search and seizure operation, the entire books of account and records were taken by the department. Further, it was stated that the Chartered Accountant of the assessee was suffering from chronic illness and succumbed to illness on 09.03.2016. It was stated that the above two incidences had let to a situation of the books of account not being audited. The learned Departmental Representative supported the orders of the Income-tax authorities.
After hearing the rival contentions, the Tribunal noted that the search and seizure in assessee’s case were conducted on 06.01.2009.
“The assessee had obtained the copy of all the seized records. The demise of the Chartered Accountant in the year 2016 cannot be a reason for not auditing the books of account for the assessment year 2009-2010. Therefore, there was no reasonable cause as mandated u/s 273B of the Income Tax Act for deletion of the penalty imposed under section 271B for the assessment year 2009-2010,” the Tribunal held.
Subscribe Taxscan Premium to view the JudgmentThe Income Tax Appellate Tribunal (ITAT), Delhi bench has held that the closing allowance provided to the employees cannot be disallowed under Section 37(1) of the Income Tax Act, 1961 if the same is quantifiable.
The assessee, a District Cooperative Bank, is operating in the District of Bijnor (Uttar Pradesh), filed the income tax return on 28/09/2013 declaring total income of Rs.5,25,63,310/-. The case was selected for scrutiny and notice under section 143(2) of the Income-tax Act, 1961 was issued and complied with.
While concluding the proceedings, the Assessing Officer made various additions to the returned income and assessed the income at Rs.8,85,81,080/-.
On appeal, the assessee approached the Commissioner of Income Tax (Appeals) wherein the claim of the assessee was partly allowed. Therefore, the Revenue filed an appeal before the Tribunal.
After hearing both the sides, the Tribunal observed that the assessee has claimed before us that the amount of closing allowance has been paid to the employees from year to year in percentage terms of salary and therefore duly quantifiable provision.
“The Ld. DR also could not controvert this fact that the amount of closing allowance is quantifiable in respect of each employee. It is also not in dispute that the amount was incurred wholly and exclusively for the purpose of the business. In our opinion, when the amount of provision is quantifiable, the same cannot be said as an unascertained liability. Accordingly, the same is allowable under section 37(1) of the Act as incurred wholly and exclusively for the purpose of the business of the assessee. The ground of the appeal of the Revenue is accordingly dismissed,” the Tribunal said.
Subscribe Taxscan Premium to view the JudgmentThe results of the Chartered Accountants Intermediate Examination (Old Course & New Course) held in May-June 2019 are expected to be declared on Friday, August 23, 2019 (evening) / Saturday, August 24, 2019. The results and the details of marks of Intermediate Examination (Old Course & New Course) will be hosted on the below mentioned websites:
The All India Merit list (upto the 50th Rank) in the case of Intermediate Examination (Old Course & New Course) will also be available on the above mentioned websites.
Placed below is the data of the students that were admitted in Intermediate Examination (Old Course & New Course) held in May-June 2019.
Intermediate (IPC) Examination (Old Course)
Intermediate Examination (New Course)
No. of Exam Centres in Intermediate Course – 479
Arrangements have also been made for the students of Intermediate Examination (Old Course & New Course) desirous of having results on their e-mail addresses to pre-register their requests only at the website i.e. icaiexam.icai.org. All those registering their requests will be provided with their results through e-mail on the e-mail addresses registered as above immediately after the declaration of the results.
In addition to above, it may be noted that for accessing the result at the above mentioned websites, the student shall have to enter his registration no. or PIN no. along with his roll number.
Further, facilities have been made for students of Intermediate Examination (Old Course & New Course) held in May-June 2019 desirous of knowing their results with marks on SMS.
For getting results through the message students should type:
CAIPCOLD (space) XXXXXX (Where XXXXXX is the six digit Intermediate (IPC) Examination roll number of the candidate) e.g. CAIPCOLD 000128
CAIPCNEW (space) XXXXXX (Where XXXXXX is the six digit Intermediate Examination roll number of the candidate) e.g. CAIPCNEW 000128
and send the message to: 58888 – for all mobile services – India Times
The Central Board of Indirect Taxes and Customs ( CBIC ) has again extended the implementation of Facility of Blocking and Unblocking of E-Way Bill to Novenmber 21st 2019.
The date of applicability of Rule 138E to 21st day of November, 2019 from existing 21st day of August, 2019. Rule 138E provided that if a registered dealer is failed to file GST Return for consecutive two tax periods, there would be Restriction on furnishing of information in PART A of FORM GST EWB 01.
Not only the taxpayers themselves but even the other person would not be able to generate on such taxpayers’ behalf.
Subscribe Taxscan Premium to view the JudgmentThe Central Board of Indirect Taxes and Customs ( CBIC ) has extended due date for GSTR-3B return for July 2019 to August 22nd.
GSTR-3B is a monthly return. All regular taxpayers need to file this return till June 2018. Taxpayers can file their return on GST Portal.
According to sources, the Notification in this regard will be issued shortly. The last date for filing GSTR-3B for the month July was yesterday.
The division bench of the Gujarat High Court has slammed sales tax authority for collecting a revenue from a private firm Micromax Informatics Limited. The High Court has termed the action of state tax authorities to collect revenue from a private firm as “nothing short of extortion”, and ordered the return of Rs 1.49 crore recovered from it along with an interest of six per cent.
A division bench comprising of Justice J.B Pardiwala and Justice A.C Rao said that, “We were inclined to take a very strict view of the matter. This is not the way and the manner to recover tax. The department should not get somuch desperate for the revenue. The revenue is to be collected in accordance with law. The action at the end of the authorities in the present case is nothing short of extortion”.
The Court also ordered that, The amount of Rs.1,49,27,723/ [Rupees One Crore Forty-Nine lakh Twenty Seven Thousand Seven Hundred and Twenty Three only] with interest at the rate of 6% p.a. from the date of 15/02/2019 shall be refunded to the writapplicant within a period of One week from today without fail.
After an audit assessment under provisions of the Gujarat Value Added Tax Act, Micromax was on October 30, 2018, directed by the deputy commissioner of state tax in Ahmedabad to pay Rs 1,49,27,723 as tax.
Following this, the company moved an appeal under Section 73 of the Act to a stay against the assessment order.
On January 25, 2019, the company’s banker received a notice from the sales tax deputy commissioner, demanding the release of the amount, even as the copy of the notice was not served on the company.
Subscribe Taxscan Premium to view the JudgmentThe Central Bureau of Investigation ( CBI ) had, a few days ago, arrested a Superintendent, GST Division, Khanna (Punjab) for demanding and accepting a bribe of Rs. 50,000/- from the complainant.
A case under Section 7 of PC (Amendment) Act, 2018 was registered against a Superintendent, GST Division, Khanna (Punjab) on a complaint. The complainant alleged that he is running a firm of iron trading at Mandi Gobindgarh on behalf of his maternal uncle and on 29.07.2019 the accused had detained their truck containing iron scrap material at Khanna. It was further alleged that later on, a bribe of Rs. one lakh was demanded by the accused for releasing his truck and on the request of the complainant, the accused reduced the amount to Rs. 50,000/-. CBI laid a trap and caught the Superintendent, GST Division, Khanna red handed while demanding and accepting a bribe of Rs.50,000/ from the complainant.
Searches are being conducted today at the residential and office premises of the accused at Mohali and Khanna. The arrested accused will be produced tomorrow before the Competent Court at Mohali.
The Delhi bench of the Income Tax Appellate Tribunal (ITAT), has accepted the claim of Senior Advocate Harish Salve for deduction of the foreign scholarship given by him to two Indian students as “expenditure solely and exclusively for the purposes of business”.
While allowing the deduction to the lawyer who recently represented India before the International Court of Justice in the Kulbhushan Jadhav case, the Tribunal held that the scholarship expenses were “incurred by the assessee for promoting his professional profile.
Salve claimed the deduction in the returns of Rs.50,52,50,407 filed for the assessment year 2011-12. The Senior Advocate, who recently represented India before the International Court of Justice in the Kulbhushan Jadhav case, argued that the foreign scholarship increased his international visibility and enabled him to develop contacts with academia in UK.
The Tribunal observed that the allowability of an expenditure incurred by the assessee u/s 37 (1) of the act is required to be tested in accordance with nature and scale of the business/ profession of the assessee. It may be a case that in case of one assessee, particular expenditure is “ wholly and exclusively “ incurred for the purposes of business and in another case it may not be so. Undoubtedly, assessee is a noted international lawyer who has set up a scholarship for creating his visibility in international arena and his social standing.
Granting deduction to Salve, the Tribunal held that “We do not subscribe to the view of the learned CIT – A these expenditure is capital in nature. The expenditure incurred by the assessee is the routine day-to-day expenditure incurred by the assessee for promoting his professional profile. These expenditure cannot be held to be capital expenditure in nature as no fresh new fixed assets is created by paying the scholarship sum. Further merely because in the agreement it is mentioned as an annual gift in the form of scholarship, it does not become a gift. In fact, it is the expenditure incurred by the assessee in furtherance of his business.”
Subscribe Taxscan Premium to view the JudgmentThe taxpayers who do not file their GST returns for the period 2017-18 by August 31st will face very consequences including huge penalty, Chief Commissioner of Customs and CGST Visakhapatnam Zone, Naresh Penumaka, has said.
This is in the light of revelation that only 80 per cent of traders in Visakhapatnam has filed their GST returns till now.
It involved a consolidated filing of the monthly returns filed by them and the date had been extended several times and would not be extended further, he said at a press conference here. They should approach the nearest Central Excise officials for hand-holding and filing the returns, he suggested.
Besides, not passing on the benefit of GST to customers or indulging in any fraud in input tax credit or any attempt to use it as working capital or not remitting GST collected from consumers might lead to imprisonment, he warned traders.
He also mandated the traders to issue a bill collecting GST as per the reduction effected by the GST Council from time to time. The Directorate General of Analytics and Risk Management was analysing bulk data to check GST fraud. The National Anti-Profiteering Authority would also investigate it.
He denied that cumbersome process was the reason for the delay in filing returns citing 90 % compliance at the national-level and some States reporting as high as 70%. “Some are deliberately delaying payment,” he said.
Also the Central Excise and Service Tax dues pending for the past two years also should be paid in two weeks, Mr. Naresh said warning of imprisonment of it was not complied with.
With the modifications in GST returns from October and January 2020 new returns should be filed and GSTR 3B would be done away with, Nr. Naresh revealed.
Principal Commissioner, Customs, Visakhapatnam Zone, D.K. Srinivas, said there was an exponential growth and for the first time the zone crossed Rs. 10,000 crore mark in customs duty collection in the previous year. It kept pace with the 20% increase in the target during the current year with Rs. 4,700 crore collected in the first four months. Besides IGST returns and ‘drawbacks’ of rs. 400 crore was paid.
Principal Commissioner, GST of Visakhapatnam Zone, Faheem Ahmed, announced the schedule for awareness programmes in the city and divisions.
The Supreme Court of India upheld the decision of the High Court of Judicature at Madras has dismissed a batch of writ petitions which challenged the constitutional validity of the provisions of the Tamil Nadu Value Added Tax Act, 2006.
A White Paper released by the Committee of Finance Ministers in 2005 proposed that Input Tax Credit (ITC) would be available to set-off against tax liability on all intra-state and inter-state sales. However, the Tamil Nadu Legislative Assembly passed the Tamil Nadu Value Added Tax Act, 2006, under which one of the provisions laid down that ITC would not be allowed on the purchase of goods sold as such or used in the manufacture of other goods and sold in the course of inter-State trade or commerce, to an unregistered dealer under another State. Moreover, a notification issued by the Government of Tamil Nadu mandated the necessity of a Form ‘C’ in order to avail ITC.
The Central Sales Act, 1956 makes this distinction between registered and unregistered dealers. In this case, the State Government was the dealer, and the question was whether the Government was a registered or unregistered dealer.
The High Court had noted the specific stand taken by the State Government to the fact that in respect of unregistered dealer in other States, the State of Tamil Nadu has no mechanism to prevent evasion of tax and loss of revenue cost by trade with such unregistered dealers in the State of Tamil Nadu. Therefore, the provision was aimed at achieving a specific and justified purpose and could not be treated as discriminatory, and thus not unconstitutional. The purpose of inserting provisions denying ITC was to protect the Government Revenue against clandestine transactions resulting in the evasion of tax.
With regards to Form ‘C’, the Supreme Court bench comprising of Justice held that in those cases where a dealer makes sales exclusively to the other State Government(s), benefit of ITC would be allowed without insisting on the furnishing of Form ‘C’. The Supreme Court clarified that when dealers who are making sales exclusively to the other State Governments (i.e. outside the State of Tamil Nadu), the said States would be deemed as registered dealers for the purposes of availing benefits of ITC.
Subscribe Taxscan Premium to view the JudgmentIn an assessee-friendly verdict, a two-judge bench of the Gujarat High Court has restricted the Goods and Services Tax (GST) authorities from arresting a city-based trader Vimal Goswami merely on suspicion of tax evasion.
The petitioner approached the High Court apprehending an arrest by the GST authorities invoking powers under section 69 of Central GST Act. GST officials searched his home on July 19 and put seal on documents kept in his cupboard. He was then issued summons on July 23 asking him to remain present before the authority on July 25. The seal was removed on July 26 by the officials. Next day on July 27, another summons was issued to him ordering his presence on the same day. Goswami approached the HC through advocate Chetan Pandya, who argued before the HC that there is a laid down procedure in the law for the department to determine tax liability of a trader.
The bench comprising J B Pardiwala and Justice A C Rao clarified that the authorities should not use the power to arrest without ‘completing their homework’ namely determining the tax liability and ascertaining the evasion.
The bench last week issued notice to the commissioner of state tax on the “important issue” of exercising the power to arrest people without following the procedure laid down in the Central GST (CGST) and State GST (SGST) laws.
The court has sought explanation on such arrests by September 18. While staying Goswami’s arrest, the High Court said, “The powers of arrest under section 69 of the Act, 2017 are to be exercised with lot of care and circumspection. Prosecution should normally be launched only after the adjudication is completed”.
“To put in other words, there must be, in the first place, a determination that a person is liable to a penalty. Till that point of time, the entire case proceeds on the basis that there must be an apprehended evasion of tax by the assessee,” the court underscored. Goswami deals in steel goods and is a proprietor of a firm called Heugo Metal.
The petitioner also expressed apprehension that the authorities may arrest Goswami by invoking powers under section 69 of CGST Act. Once arrested, it would be difficult for the person to come out of jail for two months and he faces maximum punishment of five years, if convicted for tax evasion. But the department intends to do the procedure of determination of tax liability after arrest, which is against constitutional rights of a person and in violation of GST laws.
Subscribe Taxscan Premium to view the JudgmentTwo Arrests have been made by the Directorate General of GST Intelligence (HQs) in cases of fraudulent IGST refund claims here, today. As per the statement of the DGGI (HQs), the action was taken on receipt of an input from Allahabad Bank, Paschim Vihar, New Delhi that suspicious transactions were noticed in the accounts of 4 proprietorship firms (Monal Enterprises & Ors.) wherein large quantum of IGST refunds had been received by them immediately after their opening, without any prior business transaction history. Further, the refunds credited to these bank accounts were withdrawn/transferred in quick succession. Developing on the input, DGGI (HQs) verified that the addresses of these firms were either non-existent or the firms were not operating at the given addresses.
Further investigations revealed that the said 4 firms were in the names of benami individuals whose identification documents had been fraudulently obtained for the opening of these bank accounts and to obtain GST registrations. It was further revealed that the said 4 firms had no corresponding purchases against the exports claimed to have been made by them, nor had any export proceeds been realized. E-way bill data also revealed that corresponding movement of goods did not exist. Therefore, the said 4 firms had indulged in fraudulent availment of IGST refunds on the basis of fake invoices.
Investigations further revealed that Shri Ramesh Wadhera the mastermind who was controlled these fake firms and operated them with the connivance and active involvement of Shri Mukesh Kumar who fraudulently obtained identification documents used in this racket, from gullible employment seekers. It was further found that 10 more similar fake/fraudulent firms are being operated by the said two individuals. The total fraudulent IGST refund availed by these 14 firms amounts to Rs. 44 Crore, approximately. Searches were conducted at several premises over 13-15th August, 2019. Shri Ramesh Wadhera and Shri Mukesh Kumar have been arrested under the provisions of Section 69 of the CGST Act, read with Section 20 of the IGST Act, 2017 for their active role in defrauding the Exchequer by claiming fraudulent IGST refunds. Shri Ramesh Wadhera is learnt to have several old cases of DRI/Customs against him.
Further investigations in the matter are under progress.
A single bench of the Kerala High Court recently passed a judgment that clarified the legal stance concerning a debated issue of whether the Transport Authorities and Officers in Kerala can compel owners of those vehicles which are registered in the Union Territory of Puduchheri and being used in the State of Kerala for long periods, to pay lifetime tax on such vehicles for their use in the State of Kerala.
Section 40 of the Motor Vehicles Act, 1988 states that every owner of a motor vehicle shall cause the vehicle to be registered by a registering authority ‘in whose jurisdiction he has the residence or place of business where the vehicle is normally kept’.
Taxation of vehicles is a subject of legislation in the Concurrent List, meaning that both the Centre and the States can levy tax on vehicles, and rhetorically, the laws made by the Centre have precedence over those made by the State. The State of Kerala has its own vehicle taxation law, called the Kerala Motor Vehicles Taxation Act, 1976, Section 3 (6) of which states that when non-transport vehicles registered outside the State of Kerala are used in Kerala for more than 30 days, the Government can levy tax upon such vehicle.
Recently, transport authorities imposed lifetime tax on the vehicles which were registered in Puducherry, but were being used in Kerala for over 30 days and likely to be used for a long period. The authorities claimed that the owners were trying to evade tax and that is why they registered their vehicles in the Union Territory of Puducherry.
The High Court held that if the documents furnished by the owners of the vehicles are true and genuine, showing that they are entitled to register their vehicles in Puducherry, then they cannot be compelled to pay lifetime tax as if they were registered in the State of Kerala, however, when the period of such use exceeds 30 days, tax can be levied upon the vehicle. Exemption is granted to vehicles only if they are not ‘used’ in Kerala during that period, and a prior request has to be submitted to the Road Transport Officer (RTO).
The High Court also held that such orders imposing tax cannot be issued without allowing a reasonable opportunity of hearing to the owners of such vehicles. The Transport Authorities are bound to observe the principles of natural justice before issuing such an order. Thus, a notice is a sine qua non before issuing an order to such vehicle owners.
Subscribe Taxscan Premium to view the JudgmentThe Authority for Advance Ruling (AAR), Goa has reiterated that the services like Naturopathy, Yoga, Ayurveda fall under health care.
The AAR order also said that such ‘health care services’ rendered at clinical establishments by authorized medical professionals would be exempt from GST.
The applicant, Devaaya Ayurveda & Nature Cure Centre providing treatment services to patients through Ayurveda, Naturopathy and Yoga wanted to know if it qualifies as a clinical establishment and whether the services provided qualify to be health care services which are exempted under Central Tax (Rate).
The applicant contended that it provides health services for both international and Indian patients for neuro-muscular problems, post-chemo therapy, post-radio therapy treatment, skin problems, metabolic issues like obesity, life style problems and orthopedic problems like rheumatoid arthritis, osteoarthritis etc.
It also contended that it has a team of doctors specialized in naturopathy, yoga and Ayurveda that conduct body composition assessment and records detailed history of the ailment including present medication of the guests. Based on such analysis medications, diet restrictions and daily treatments are planned.
After considering the legal provisions and facts of the case, the AAR held that the services provided by way of appropriate diagnosis, appropriate medicines as well as relevant consumables or implants as part of treatment under supervision of qualified doctors in its Center would qualify as clinical establishment and the services offered by it would qualify to be healthcare services.
Further, the Authority held that various treatments, supply of medicines, consumables and implants used in the course of providing health care services to in-patients for diagnosis or treatment are naturally bundled and are provided in conjunction with each other and therefore, would be considered as ‘Composite Supply”. Hence, it is eligible for exemption under the category of healthcare services.
Subscribe Taxscan Premium to view the JudgmentThe Ministry of Corporate Affairs has amended the provisions relating to issue of shares with Differential Voting Rights (DVRs) provisions under the Companies Act with the objective of enabling promoters of Indian companies to retain control of their companies in their pursuit for growth and creation of long-term value for shareholders, even as they raise equity capital from global investors.
The key change brought about through the amendments to the Companies (Share Capital & Debentures) Rules brings in an enhancement in the previously existing cap of 26% of the total post issue paid up equity share capital to a revised cap of 74% of total voting power in respect of shares with Differential Voting Rights of a company.
Another key change brought about is the removal of the earlier requirement of distributable profits for 3 years for a company to be eligible to issue shares with Differential Voting Rights.
The above two initiatives have been taken by the Government in response to requests from innovative tech companies & startups and to strengthen the hands of Indian companies and their promoters who have lately been identified by deep pocketed investors worldwide for acquisition of controlling stake in them to gain access to the cutting edge innovation and technology development being undertaken by them.
The Government had noted that such Indian promoters have had to cede control of companies which have prospects of becoming Unicorns, due to the requirements of raising capital through issue of equity to foreign investors.
Alongside the above two changes, another major step taken is that the time period within which Employee Stock Options (ESOPs) can be issued by Startups recognized by the Department for Promotion of Industry & Internal Trade (DPIIT) to promoters or Directors holding more than 10% of equity shares, has been enhanced from 5 years to 10 years from the date of their incorporation.
In a major setback to the income tax department, the Income Tax Appellate Tribunal ( ITAT ), Ahmedabad bench has dismissed more than 600 appeals in a single day.
The cases were dismissed on the basis of recent Circular issued by CBDT on August 8, the Circular had increased the threshold for filing cases in ITAT from Rs 20 Lakh to Rs 50 Lakh retrospectively.
The gross amount included in the cases were around Rs. 350 crores. The Tribunal observed that the tax effect involved in all these appeals does not exceed the revised threshold of Rs. 50 lakhs.
The department argued that the CBDT circular is not retrospective as it specifically states that the said modifications shall come into effect from the date of issue of this Circular.
However, the Tribunal clarified that the CBDT’s latest circular has to be read in conjunction with the CBDT circular issued in July 2018.
ITAT rules that, “the relaxation in monetary limits for departmental appeals, vide CBDT circular dated 8th August 2019 shall be applicable to the pending appeals in addition to the appeals to be filed henceforth.”
ITAT appreciated the move and noted in its order “very pragmatic and taxpayer friendly policy decision by the Government of India for reducing the income tax litigation” it further observed that, “ in an environment in which retrospectively was attached only to the taxation and not to tax reliefs or concessions, such an approach is a pleasant departure from legacy practices.”
Tribunal noted that increasing monetary limits offers taxpayers freedom from the prolonged mental agony and uncertainty of litigation.
On August 8
With a view to reduce tax litigations, the CBDT had issued a circular on 8th August and revising the monetary tax disputes limit for ITAT appeals from Rs 20 Lakh to Rs 50 Lakh, Similarly for High Courts from Rs 50 Lakh to Rs 1 Cr and for Supreme Court it was revised to Rs 2 Cr.
