NICAI Update

NICAI Updates;

1. Income Tax Section 80IAB deduction eligible on interest income on FDs linked to SEZ business operations. Case Name : Candor Gurgaon One Realty Projects Pvt Ltd Vs ACIT (ITAT Delhi)



2. IGST Refund Cannot Be Denied Due to GSTN Portal & ICEGATE Data Mismatch. Case Name : Venus Jewel Vs Union of India ( Bombay High Court).



3. SEBI's move to require stockbrokers to charge customers only the actual fees paid to exchanges, clearing houses, and depositories has had major consequences for stockbroking firms. In its circular, Sebi had asked brokers to be 'true to the label' in how they levy charges.



4. SEBI has issued a significant circular aimed at modernizing and streamlining the dispatch of Consolidated Account Statements (CAS) and holding statements. In line with the increasing adoption of digital technology and as a part of green initiatives,



5. SEBI has proposed stricter eligibility criteria for adding and retaining stocks in the futures and options (F&O) segment, which accounts for the bulk of the trading volumes. The proposal-which comes six years after the securities regulator last revised the stock selection framework is much awaited by the market players as the derivatives stock list has largely remained stagnant for the last two years.



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CA (Dr) Raj Chawla
98110-81083

NICAI Updates;

1. Income Tax Section 271D & 271E Penalty cannot be levied if assessment is quashed. Case Name : Ravi Nirman Nigam Ltd Vs ACIT (ITAT Mumbai).



2. GST collection for June 2024 stood at Rs 1.74 trillion, marking 7.7 per cent year-on-year (Y-o-Y) growth.



3. CBIC has issued Circular No: 211/05/2024- GST dated 26th June 2024, Clarification on the time limit under Section 16(4) of CGST Act, 2017 in respect of RCM supplies received from unregistered persons.



4. Centre is working on coming up with accounting standards for the banking and insurance sectors, Corporate Affairs Secretary Manoj Govil said.



5. Punjab and Chandigarh, dated 28th June 2024, concerns the imposition of penalties under Section 454 of the Companies Act, 2013, read with Rule 3 of the Companies (Adjudication of Penalties) Rules, 2014, against Smt. Shashi Singla for obtaining a second DIN in violation of Section 155 of the Companies Act, 2013.



6. ICAI CA GPT (Beta) is live for the first 7500 members! Access 18 specialized GPTs now. Visit ai.icai.org/cagpt/ to log in and start exploring.



7. ICAI through its Insolvency & Valuation Standards Board is organizing 2nd Edition of International Convention on Insolvency Resolution and Valuation on 12th and 13th July 2024 at Bharat Mandapam, New Delhi. Join us for the one of the most remarkable event on Insolvency and Register at resolve.icai.org



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98110-81083

Quotes of the Day:
1. The answers you seek never come when the mind is busy; they come when the mind is still. That's when silence speaks and provides you with the answers.
2. The NUMBER ONE reason why people GIVE UP so FAST is Because They TEND to LOOK at HOW FAR they still HAVE to GO Instead of HOW FAR they have REACHED.
NICAI Updates;
1. Shri Ravi Agrawal, a 1988-batch IRS officer, has been appointed as the new chairman of the CBDT, the administrative body for the Income Tax Department. He takes over from Nitin Gupta, a 1986-batch Indian Revenue Service officer, whose extended tenure as the chairman ends on June 30.
2. Share application amount cannot be added twice in payees & recipients’ hands u/s 68 of the Income Tax Act. Case Name : ITO Vs Happy Structure Pvt. Ltd. (ITAT Kolkata)
3. CBIC has issued Circular No: 212/6/2024- GST dated 26th June 2024, regarding the Mechanism for providing evidence of compliance of conditions of Section 15(3)(b)(ii) of the CGST Act, 2017 by the suppliers.
4. CBIC has issued Circular No: 210/4/2024- GST dated 26th June 2024, regarding Clarification on the valuation of the supply of import of services by a related person where the recipient is eligible for full input tax credit.
5. ICAI through its Insolvency & Valuation Standards Board is organizing 2nd Edition of International Convention on Insolvency Resolution and Valuation on 12th and 13th July 2024 at Bharat Mandapam, New Delhi. Join us for the one of the most remarkable event on Insolvency and Register at resolve.icai.org;
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CA (Dr) Raj Chawla
98110-81083

Happy CA Day to all. ICAI has completed 75 glorious Years and become the largest accounting body in the world. Let’s work together for Viksit Bharat

1. CBDT has issued an order dated 27th June 2024 under Section 10 of the Direct Tax Vivad se Vishwas Act, 2020 (DTVsV Act). This order addresses representations and applications received by CBDT and field authorities regarding the acceptance of delayed payment of taxes specified in Form-3 of the DTVsV Rules.



2. CBIC clarified that if an MNC subsidiary in India as service recipient is eligible to claim full ITC under the GST, the value declared by the overseas affiliate in the invoice will be treated as the taxable value. But in cases, where the foreign affiliate does not raise an invoice, it would be presumed that the value of services is nil and no GST is required to be paid.



3. DGFT proposed to amend the export obligation period for certain sectors such as spices, pharmaceuticals and tea, with a view to facilitate outbound shipments. The government has sought comments of all the concerned stakeholders on the proposed amendments within 15 days.



4. Labour ministry amended the Employees' Pension Scheme (EPS), 1995 to ensure that EPS members with less than six months of contributory service also receive withdrawal benefit. The move is expected to benefit more than 700,000 EPS members every year who leave the scheme with less than six months of contributory service.



5. Once Resolution Plan Is Approved; Government Cannot Make Any Further Claim. Case Name : EMCO Limited Vs Joint Commissioner State Tax. Telangana High Court.



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GST Circulars;

New 16 circulars under GST issued as per recommendation of GST Council in 53rd Meeting:



1. Circular no 207- Fixing monetary limits for filing appeals or applications by the Department before GSTAT, High Courts and Supreme Court.

2. Circular no 208- Clarifications on various issues pertaining to special procedure for the manufacturers of the specified commodities.

3. Circular no 209- Clarification on the provisions of clause (ca) of Section 10(1) of the Integrated Goods and Service Tax Act, 2017 relating to place of supply.

4. Circular no 210- Clarification on valuation of supply of import of services by a related person where recipient is eligible to full input tax credit.

5. Circular no 211-Clarification on time limit under Section 16(4) of CGST Act, 2017 in respect of RCM supplies received from unregistered persons.

6. Circular no 212-Clarification on mechanism for providing evidence of compliance of conditions of Section 15(3)(b)(ii) of the CGST Act, 2017 by the suppliers.

7. Circular no 213-Seeking clarity on taxability of re-imbursement of securities/shares as SOP/ESPP/RSU provided by a company to its employees.



8. Circular no 214 -Clarification on the requirement of reversal of input tax credit in respect of the portion of the premium for life insurance policies which is not included in taxable value.

9. Circular no 215- Clarification on taxability of wreck and salvage values in motor insurance claims.

10. Circular no 216-Clarification in respect of GST liability and input tax credit (ITC) availability in cases involving Warranty/ Extended Warranty, in furtherance to Circular No. 195/07/2023-GST dated 17.07.2023.

11. Circular no 217-Entitlement of ITC by the insurance companies on the expenses incurred for repair of motor vehicles in case of reimbursement mode of insurance claim settlement.

12. Circular no 218- Clarification regarding taxability of the transaction of providing loan by an overseas affiliate to its Indian affiliate or by a person to a related person.

13. Circular no 219- Clarification on availability of input tax credit on ducts and manholes used in network of optical fiber cables (OFCs) in terms of section 17(5) of the CGST Act, 2017.

14. Circular no 220- Clarification on place of supply applicable for custodial services provided by banks to Foreign Portfolio Investors.

15. Circular no 221- Time of supply on Annuity Payments under HAM Projects.

16. Circular no 222-Time of supply in respect of supply of allotment of Spectrum to Telecom companies.



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NICAI Updates;

1. India is reviewing the 'faceless' income tax assessment mechanism to make it more taxpayer-friendly, following suggestions that the programme can be made more effective. A hybrid formula is being examined that could allow taxpayers to pick either the faceless scheme or in-person resolution.
2. GST Authorities cannot resort to best judgment assessment under Section 74 adjudication. Case Name : Diamond Steel Vs State of Up And 3 Others (Allahabad High Court).
3. CA Certificate not required to claim refund of unutilized ITC: Case Name : Svera Agro Limited Vs Commissioner of Central Tax And GST ( Delhi High Court).
4. Private aerospace and defence companies are expected to post a revenue growth of 20 per cent to reach approximately Rs 13,500 crore this fiscal, said a report by CRISIL Ratings. This, it added, will be propelled by higher government spending and concerted efforts to encourage private participation.
5. SEBI has issued a Master Circular (No. SEBI/HO/MRD/MRD-PoD-1/P/CIR/2024/87) on June 24, 2024, consolidating all provisions related to Electronic Gold Receipts (EGRs) from previous circulars, including updates up to May 31, 2024.
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NICAI Updates;

1. Income Tax Section 148 notice invalid if not comply with Finance Act 2021: Case Name : Uppariguda Primary Agricultural Cooperative Society Limited Vs Assessment Unit (Telangana High Court).

2. Allahabad High Court directs GST Council to consider extending appeal period for Sections 129 & 130 orders. Case Name : Tenet Networks Private Ltd. Vs Gst Council And 3 Others.

3. Sebi has recalled its earlier directive asking investment bankers to ensure that special rights given to shareholders of IPO bound companies are lapsed when the updated draft red herring prospectus (UDRHP) is filed.



4. Sebi will consider a proposal to tighten rules on the inclusion of stocks in the derivatives segment at its board meeting on June 27.



5. ICAI Invitation for CA Day Celebrations to be held at Bharat Mandapam Delhi on 1st July 2024. Click on link below to register-

https://invite.icai.org/



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98110-81083

NICAI Updates;
1. Kerala High Court has restored the income tax appeal of Cool Mind Technologies Private Limited, which was previously dismissed by the Income Tax Appellate Tribunal (ITAT) for non-prosecution. This judgment underscores the judicial emphasis on considering appeals on their merits, regardless of procedural lapses. The case, arising from the denial of tax deductions claimed under Sections 10B and 10A of the Income Tax Act, highlights critical aspects of appellate procedures and taxpayer rights.
2. GST Council on Saturday announced several steps to ease the compliance burden of taxpayers and reduce litigation, tweaked the rates for a few items and set a sunset date of April 1, 2025, for the controversial anti- profiteering mechanism.
3. GST Council has exempted services related to hostel accommodation outside educational institutions, up to Rs 20,000 per person per month, provided the student stays in the hostel for at least 90 continuous days. This condition aims to prevent hotels from misusing the exemption.
4. GST Council's decision to provide tax exemption on corporate guarantees in two scenarios - transactions that qualify as "export of services" and recipients who can claim full input tax credit - may not provide any relief to the power or real estate sectors, which are facing tax liabilities to the tune of Rs 1,000 crore.
5. Indian technology (tech) startups raised $4.1 billion in H1 2024, marking a 4 per cent increase from $3.96 billion in H2 2023. However, this represents a 13 per cent decrease compared to the $4.8 billion raised in H1 2023. India, which ranked as the fourth-highest-funded country globally in the tech startup landscape, slipped a position as China advanced in the pecking order in terms of raising higher funds.
6. Pre-existing dispute cannot be decided in a summary procedure: NCLAT Delhi. Case Name : Sanjay Kumar Vs Gannon Dunkerley & Co Ltd (NCLAT Delhi)
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98110-81083

GST Recommendations;

1. GST Council recommends waiving interest and penalties for demand notices issued under Section 73 of the CGST Act (i.e. the cases not involving fraud, suppression or wilful misstatement, etc.) for the fiscal years 2017-18, 2018-19 and 2019-20, if the full tax demanded is paid upto 31.03.2025.

2. GST Council recommends the time limit to avail input tax credit w.r.t. any invoice or debit note under Section 16(4) of CGST Act, through any GSTR 3B return filed upto 30.11.2021 for FY 2017-18, 2018- 19, 2019-20 and 2020-21, may be deemed to be 30.11.2021.

3. Council has recommended a monetary limit of Rs. 20 lakh for GST Appellate Tribunal, Rs. 1 crore for High Court and Rs. 2 crore for Supreme Court, for filing of appeals by the Department, to reduce litigation.

4. GST Council recommends reduction of the quantum of pre-deposit required to be paid for filing of appeals under GST.

5. GST Council recommends amending provisions of CGST Act to provide that the three-month period for filing appeals in GST Appellate Tribunal will start from a date to be notified by the Government.

6. To ease the interest burden of the taxpayers, GST Council recommends to not levy interest u/s 50 of CGST Act in case of delayed filing of return, on the amount which is available in Electronic Cash Ledger (ECL) on the due date of filing of the said return.

7. GST Council recommends sunset clause from April 1st, 2025 for receipt of any new application for Anti- profiteering.

8. GST Council recommends exemption from Compensation Cess leviable on the imports in SEZ by SEZ Unit/developer for authorised operations from 1st July, 2017.

9. GST Council recommends 12% GST on milk cans (steel, iron, aluminum) irrespective of use; Carton, Boxes And Cases of both corrugated and non- corrugated paper or paper-board; Solar cookers whether single or dual energy source; and sprinklers including fire water sprinklers.

10. GST Council recommends exemption of certain services provided by Indian Railways to common man and also intra railway supplies GST Council recommends certain exemptions related to accommodation services, providing relief to students and working professionals.

11. GST Council recommends to roll-out the biometric- based Aadhaar authentication of registration applicants on pan-India basis in a phased manner.

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NICAI Updates;

1. Gross Direct Tax collections for the Financial Year (FY) 2024-25 have registered a significant growth of 22.19%, indicating robust economic activity and improved compliance. The Net Direct Tax collections for the same period have also shown a substantial increase, growing by over 20.99%.

2. NCLT/ NCLAT is Not the Proper Forum for Individual Share Transfer Disputes: Case Name : Cherukuri Ramakrishna Vs Sandhya Hotel Private Limited (Telangana High Court)

3. DGFT clarified vide Policy Circular No. 06/2024-25-DGFT | Dated: 19th June, 2024 that Import made by SEZ units (Other than FTWZ units) under ITC (HS) Codes 71131912, 71131913, 71131914, 71131915 and 71131960 are outside purview of Notification no. 17/2024-25 dated 11.06.2024.

4. India is expected to add 30 gigawatt of power generation capacity this financial year, with more than 80% of it coming from renewable energy, according to rating agency Icra. India's total capacity addition in FY24 stood at 25 GW.

5. SEBI has issued a circular modifying the duration and introducing additional surveillance measures for the call auction in pre-open sessions for IPO and relisted scrips. Observations showed that some orders, placed at higher prices in large volumes during the pre-open session, were canceled just before closure, potentially manipulating prices to the detriment of common investors.

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NICAI Updates;

1. The Income Tax Department has now come out with NEW Application AIS. Now Not necessary to login to efiling site to search for 26AS/ AIS. Income tax department has released an android app by name 'AIS' available in play store and Apple Store. It shows pension credit, SB int, FD int, dividend from shares/mutual funds,TDS etc.

Steps to be followed:

i. Go to Play store/ App Store

ii. Search for "AIS". The app will appear with IT emblem

iii. Download it.

iv. Enter your PAN and Birth date.

v. TWO OTPs will come - one via SMS and another via your registered email.

vi. Both have to be entered.

vii. You have to set MPIN for accessing the app.

viii. After setting and entering the MPIN, you can view AIS details.



2. The GST Council in its Saturday meeting might mandate the GST Appellate Tribunal (GSTAT) to adjudicate anti-profiteering cases and introduce "sunset date", allowing filing of such complaints only up to April 1, 2025.



3. Outward remittances under Reserve Bank of India's (RBI's) liberalised remittance scheme (LRS) dipped nearly 2 per cent in April 2024 from the year-ago period on the back of a drop in maintenance of close relatives and deposits.



4. DGFT clarified vide Policy Circular No. 06/2024-25-DGFT | Dated: 19th June, 2024 that Import made by SEZ units (Other than FTWZ units) under ITC (HS) Codes 71131912, 71131913, 71131914, 71131915 and 71131960 are outside purview of Notification no. 17/2024-25 dated 11.06.2024.



5. PUNJAB & SIND BANK Empanelment For CA Firm, Information System Audit, India. Last date to apply:-28.06.2024



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9811081083

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NICAI Updates;

1. Speculative Transactions u/s 43(5) - transactions of purchase and sale of edible oil [(canola oil - involving high sea sales) by the assessee were speculative as no actual delivery of goods was received by the assessee.

2. ITAT CHANDIGARH- DCIT, CC-II, LUDHIANA. VERSUS M/S GH CROP SCIENCE PRIVATE LTD. AND (VICE-VERSA),- I. T. A. No. 534/Chandi/2022, I. T. A. No. 490/Chandi/2022 Dated.- June 14, 2024.

3. It is not a case, where delivery of the goods were not contemplated at all , but it is a case where goods where physically purchased by the importer from the foreign seller, who loaded the goods on the ship , and thereafter , the assessee has purchased the goods from the importer while on the high seas in transit , and thereafter, the assessee sold the goods by handing over and transfer of title documents , in favour of the ultimate buyer, which includes handing over the sale invoice, High Seas sales agreement, copy of original import invoice, and copy of bill of lading to the purchaser , while the goods were still on high seas in transit and finally , the ultimate buyer has taken delivery and physical possession of the goods by filing the bill of entry at the port of delivery in India, and complied with all the custom formalities.

4. The Ld. DR has also not disputed the factual sequence of events stated above, and has also not disputed the veracity of documentary evidence on record, regarding the ultimate delivery of goods being taken by the last buyer.

5. Respectfully following the judgments of the Hon’ble Calcutta High Court in the case of Hoosen Kasam Dada ( India ) Ltd ( supra ), and on the judgment of the Hon’ble Rajasthan High Court in Sripal Satyapal vs ITO ( supra ) and on the views expressed by the Hon’ble Andhra Pradesh High court in the case of Lakshminarayan Trading Company ( supra ) , and the judgment of the coordinate bench in ITA No 56/ ASR / 2020 in the assessee own case , we hold that the ultimate settlement of the transactions entered into by the assessee has been settled by the actual delivery of the goods to the ultimate buyer and thus the transactions of sale and purchase in the instant case does not fall within the provisions of section 43(5) of the Act 61 and are not speculative transactions.

6. Cases relied upon
i. Rajasthan High Court while dealing with the provisions of section 43(5) in the case of Sripal Satyapal vs. ITO [2008] 217 CTR 337 (RAJ

ii. Andhra Pradesh High Court in the case of Lakshmi Narayan Trading Company (1995) 82 Taxman 301 (AP)

iii. Calcutta High Court in the case of Hoosen Kasam Dada (India) Ltd. vs. CIT [1964] 52 ITR 171 (Calcutta)

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NICAI Updates;

1. In the matter of Vela Agencies vs. Assistant Commissioner ST FAC in Writ Petition No. 11030/2024, dated 26th April, 2024, the Hon’ble Madras High Court held that if the respondent intended to modify the tax proposal in light of the petitioner’s reply, a fresh show cause notice (SCN) should have been issued.



2. CBIC vide Notification No. 09/2024-Customs (ADD) dated 13 June 2024, has imposed a provisional anti-dumping duty on ‘Poly Vinyl Chloride Paste Resin’ imported from China PR, Korea RP, Malaysia, Norway, Taiwan, and Thailand. This decision follows the preliminary findings by the designated authority, which indicated that these imports were being dumped in the Indian market at prices that caused substantial injury to the domestic industry.



3. India gold and silver imports from its free trade agreement (FTA) partner UAE have skyrocketed 210 per cent to USD 10.7 billion in 2023-24 and there is a need to potentially revise the concessional customs duty rates under the pact to mitigate the arbitrage driving this surge.



4. NCLT directs repayment of preferential payment made to certain creditors. Case Name : Ankur Kumar Vs Jitendra Kikavat & others (NCLT Mumbai)



5. The Finance Minister will present the first budget of the Modi 3.0 government in the second half of July. Industries, farmers and other stakeholders across sectors are eagerly anticipating potential booster announcements from the Narendra Modi government in the upcoming budget.



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9811081083

NICAI Updates;

1. Delhi High Court Invalidates Reassessment Notice, Upholds Section 149(1)(b) Time Limits. Case Name : Dinesh Jindal Vs ACIT.



2. Delhi High Court Directs GST Registration Cancellation Application Disposal. Case Name : L G Trading House Vs Principal Commissioner of Department Of Trade And Taxes.



3. Punjab And High Court ordered that Attachment Without Notice Under CGST Section 74 is Inappropriate: Case Name : Nova Publications & Printers Pvt. Ltd. Vs Union of India and others.



4. RBI will not force merger of urban co-operative banks (UCBs), said Satish Marathe, member of the RBI's central board. In 2021, an RBI's expert committee had recommended that weak UCBs would get a regulatory nudge to explore voluntary merger or conversion into a non-banking society at an early stage.



5. The International Financial Services Centres Authority issued Circular No. IFSCA-FMPP0BR/1/2021-Banking-Part (1)/1 on June 14, 2024, amending Module No. 11 of the COB Directions v6.0 in the IFSCA Banking Handbook. This amendment redefines a “Current Account” as a type of demand deposit that may or may not earn interest, allows unlimited withdrawals, and includes accounts that are neither savings nor term deposits. It also grants IFSC Banking Units the autonomy to set interest rates, calculation methods, and credit periodicity for current accounts, with immediate effect.



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NICAI Updates;

1. CBDT is inviting suggestions from Trade and Industry Associations for the Union Budget 2024-25 regarding changes in direct and indirect taxes. Associations are encouraged to propose changes in the duty structure, rates, and tax base, providing economic justifications supported by relevant statistical data about production, prices, and revenue implications.



2. High Court of Delhi in a recent judgement quashes the reassessment notice issued under the amended regime pursuant to a search operation conducted against a third party, holding the same to be barred by limitation under first provision to Section 149(1) r.w. Section 153C r.w. Section 153A of the Act.



3. High Court while interpreting first proviso to Section 149 of the Act observed that any action for reassessment pertaining to an AY prior to 01 April 2021 can be sustained only if it be compliant with the timeframes specified under Section 149(1)(b), Section 153A or Section 153C as the case may be and on the anvil of those provisions as they existed prior to the commencement of Finance Act, 2021.



4. Interestingly, the Court also observed that the computation of the “relevant assessment year” for the purposes of assumption of jurisdiction is to be reckoned from the date of the impugned reassessment notice.



5. The GST Council will meet here on June 22, with an agenda, including proposals to bring natural gas and aviation turbine fuel (ATF) under the ambit of the GST, and a review of the way the tax on consumption is applied on online gaming, casinos and horse racing.



6. Financial Intelligence Unit-India (FIU-India), has received requests from four more offshore crypto exchanges to operate in India again. In the beginning of 2024, India had banned nine crypto exchanges -Binance, Kucoin, Huobi, Kraken, Gate.io, Bitstamp, MEXC Global, Bittrex, and Bitfenix - for non-compliance with anti-laundering law in the country.



7. MCA of India has imposed a penalty of ₹31.83 lakh on Biogenomics Limited for issuing shares in physical mode instead of dematerialized form, in violation of Section 29(1) of the Companies Act, 2013. The adjudication order, dated June 7, 2024, outlines the company’s non-compliance with dematerialization requirements despite acquiring the necessary ISIN on October 23, 2019.



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