CBDT replaces Annual Statement of TDS/TCS with new Annual Information Statement

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The amendment, aims at controlling tax evasion, and bring glassiness Form 26AS, which is now being replaced with a new Annual Information Statement (AIS) i.e Form 26AIS.

The Central Board of Direct Taxes (CBDT) on Thursday notified Income Tax (11th Amendment) Rules, 2020.

In exercise of the powers conferred by section 285BB read with section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-

In Income Tax Rules, 1962 Rule 114-I relating to Annual Information shall be inserted which is, “the Principal Director General of Income Tax (System) or the Director-General of Income Tax (Systems) or any person authorized by him shall, under Section 285BB of the Income-Tax Act, 1961, upload in the registered account of the assessee an annual information statement in Form No. 26AS containing the information specified in the column (2) of the table below, which is in his possession within three months from the end of the month in which the information is received by him.”

The notification consists of a table that contains the nature of information which includes information relating to a tax deduction or collected at source; specified financial transaction; payment of taxes; demand and refund; pending proceedings; and completed proceedings:

Sl. No. Nature of information
(i) Information relating to tax deducted or collected at source
(ii) Information relating to specified financial transaction
(iii) Information relating to payment of taxes
(iv) Information relating to demand and refund
(v) Information relating to pending proceedings
(vi) Information relating to completed proceedings
(vii) Any other information in relation to sub-rule (2) of rule 114-I

The amendment, aims at  controlling tax evasion, and bring glassiness Form 26AS, which is now  being replaced with a new Annual Information Statement (AIS) i.e Form 26AIS.

Further sub-clause (2) of Rule 114-I says, “the Board may also authorize the Principal Director General of Income-tax (System) or the Director-General of Income Tax (Systems) or any person authorized by him to upload the information received from any officer, authority or body performing any function under any law or the information received under an agreement referred to in Section 90 or Section 90A of the Income Tax Act, 1961 or the information received from any other person to the extent as it may deem fit in the interest of the revenue in the annual information statement referred to in sub-clause (1).”

Lastly, sub-clause (3) of Rule 114-I says, “the Principal Director General of Income-tax (System) or the Director-General of Income Tax (Systems) shall specify the procedures, formats, and standards for the purpose of uploading of annual information statement referred to in sub-clause (1).”

Despite pandemic, Tamil Nadu attracts 17 investors worth Rs.15,128

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The companies which signed the MoUs are from Germany, Finland, Taiwan, France, South Korea, Japan, China, USA, Australia, UK

As many as 17 MoUs’ to bring in fresh industrial investments worth Rs 15,128 crore into Tamil Nadu were signed between a host of foreign companies and the Tamil Nadu government in the presence of chief minister Edappadi K Palaniswami on Wednesday.

These projects in areas such as commercial vehicle manufacture, electronics, footwear, information technology, medical equipment and energy are expected to generate 47,150 jobs in Tamil Nadu, an official release here said.

The companies which signed the MoUs are from Germany, Finland, Taiwan, France, South Korea, Japan, China, USA, Australia, UK and the Netherlands, indicating that Tamil Nadu continues to be a destination for foreign direct investment (FDI).

Palaniswami’s government has been taking a number of initiatives for economic revival.  They include appointment of a high-power committee of economic experts led by former RBI governor C Rangarajan to chalk out strategies in the medium-term, the Industrial Guidance Bureau facilitating single-window clearance of investment proposals, the recent policy announced to boost production of medical equipment and drugs in the wake of Covid-19 and TIDCO offering a Rs.102 crore package to meet working capital requirement of 799 MSMEs’, an official release said.

The MoUs signed today include the following projects: Daimler India is to expand its commercial vehicle manufacturing at its Oragdam factory in Kancheepuram district involving an investment of Rs.2,277 crore, creating 400 more jobs.

Finnish firm Salcomp will invest Rs.1,300 crore in the Nokia special economic zone in Sriperumbudur to manufacture mobile phone components, to generate 10,000 additional jobs in Kancheepuram district and this project would help to rejuvenate the Nokia SEZ in that district.

The MoUs further include Rs. 900 crore investment by Japan’s Polymatech Electronics to make semiconductor chips at the Oragadam SIPCOT industrial park, a Rs.350 crore joint venture footwear manufacture project by Taiwan’s Chung Jye Company Ltd and Aston Shoes, a Rs.400 crore industrial park to be developed at Mappedu in Kancheepuram district by Australian firm, Lai Investment Manager Pvt Ltd., South Korea’s ‘Mando Automotive India  Pvt Ltd.  to invest Rs.150 crore in Pillaipakkam SIPCOT industrial park in Kancheepuram district, Netherlands’ Dinex to invest Rs.100 crore in the Mahindra City Industrial Park in Chengalpattu district for auto-components manufacture, a 750-mw gas-based power project at Ponneri in Thiruvallur district by Indo-UK joing venture, Chennai Power Generation Limited’ involving an investment of Rs.3,000 crore, and France’s IGL India Transplantations Solutions Ltd to invest Rs. 18 crore in medical equipment in SIPCOT park at Cheyyar in Tiruvannamalai district.

Down south in Thoothukudi and Tirunelveli districts, a huge investment of Rs. 2,000 crore is envisaged by Vivid Solaire Energy Private Limited of France, to manufacture wind mills equipment, the release said. The USA’s HDCI Data Centre Holdings Chennai LLP will invest in an IT project in Ambattur in Chennai involving an investment of Rs. 2,800 crore, it said.

While Singapore’s ST Tele Media will invest Rs. 1,500 crore in a new IT project in Chennai, wind mill components will be made by Germany’s Baetter in Chennai involving an investment of Rs.210 crore. Besides there, there are four more industrial investments in the pipeline in Kancheepuram, Thiruvallur and Chengalpattu districts including China’s ‘BYD India Private Ltd’, to invest Rs.50 crore in an electric vehicle manufacture project.

Mahindra Origins in a JV with a Taiwanese company, TJR Precision Technology Company, will invest Rs.46 crore in making precision components at Ponneri. Further, USA’s Lincoln Electric will invest Rs.12 crore in an R & D Centre at Mahindra Industrial Park in Chengalpattu district, the release added.

Top officials including Chief Secretary, Mr. K Shanmugam, Industries Secretary, N Muruganandam, State Guidance Bureau managing director, Ms. Karkala Usha, its executive director Mr. Aneesh Shekhar, and representatives of the various companies were among those who were present on the occasion.

Source: Deccan Chronicle

NCLAT quashes NCLT order to make MCA party in all insolvency cases

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NCLAT quashes NCLT order to make MCA party in all insolvency cases as this will be not only excessive but perhaps counterproductive

The National Company Law Appellate Tribunal (NCLAT) quashed an order of the National Company Law Appellate Tribunal (NCLT) directing that the Ministry of Corporate Affairs (MCA) be made a party to every case under the Insolvency and Bankruptcy Code (IBC) on Monday.

According to the appellate tribunal, the NCLT’s order, was beyond the power of the tribunal as it was tantamount to the imposition of a new rule in a compelling fashion

The impugned order making it applicable throughout the country to all the benches of NCLT is untenable and it suffers from material irregularity and patent illegality in the eye of law, said the judgment of the three-judge bench headed by Justice Venugopal M.

“The NCLAT ruled that the MCA need not be a party to all Section 7,9 and 10 applications, although they may be impleaded in certain cases based on exercise of judicial principles and following principles of natural justice. Although the MCA has been central in the implementation of the IBC, their being a party to every single IBC fillings is not only excessive but perhaps counterproductive,” said Richa Roy, partner at Cyril Amarchand Mangaldas.

In November 2019, the NCLT had directed the MCA, through its secretary, be party to all cases under IBC on the grounds that authentic records would be made available by officers of the MCA.

The Centre challenged the order arguing that such rule making was the exclusive domain of the government. It further said that authentic records could be furnished by the Registrar of Companies and certified copies could be made available for a fee.

The NCLAT order added that such “wholesale, blanket and omnibus directions” cannot be issued in a single stroke” and impleadment of the MCA can only be determined on a case-to-case basis.

MCA has extended the period for names reserved and re-submission of forms

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Ministry of Corporate Affairs ( MCA ) has extended the period for names reserved and re-submission of forms.

Issue description and Period/Days of Extension are as below: –

Names reserved for 20 days for new company incorporation.

SPICe+ Part B needs to be filed within 20 days of name reservation

  1. Names expiring any day between 15th March 2020 to 31st May would be extended by 20 days beyond 31st May 2020.
  2. Names reserved for 60 days for change of name of company. INC-24 needs to be filed within 60 days of name reservation.
    Names expiring any day between 15th March 2020 to 31st May would be extended by 60 days beyond 31st May 2020.
  3. Extension of RSUB validity for companies.
    SRNs where last date of Resubmission (RSUB) falls between 15th March 2020 to 31st May 2020, additional 15 days beyond 31st May 2020 would be allowed. However, for SRNs already marked under NTBR, extension would be provided on case to case basis.
    Note: Forms will not get marked to (Not to be taken on Record)’NTBR’ due to non-resubmission during this extended period as detailed above. It also includes IEPF Non-STP eForms ( IEPF3, IEPF-5 and IEPF-7)
  4. Names reserved for 90 days for new LLP incorporation/change of name. FiLLiP/Form 5 needs to be filed within 90 days of name reservation.
    Names expiring any day between 15th March 2020 to 31st May would be extended by 20 days beyond 31st May 2020.
  5. RSUB validity extension for LLPs.
    SRNs where last date of resubmission (RSUB) falls between 15th March 2020 to 31st May 2020, additional 15 days would be allowed from 31st May 2020 for resubmission. However, for SRNs already marked under NTBR, extension would be provided on case to case basis.
    Note: Forms will not get marked to (Not to be taken on Record)’NTBR’ due to non-resubmission during this extended period as detailed above.
  6. Extension for marking IEPF-5 SRNs to ‘Pending for Rejection u/r 7(3)’ and ‘Pending for Rejection u/r 7(7)’
    SRNs where last date of filing eVerification Report (for both Normal as well as Resubmission filing) falls between 15th March 2020 to 31st May 2020, would be allowed to file the form till 30th Sep 2020. However, for SRNs already marked under ‘Pending for Rejection u/r 7(3)’ and ‘Pending for Rejection u/r 7(7)’, the extension would be provided on case to case basis.

Note: Status of IEPF-5 SRN will not change to ‘Pending for Rejection u/r 7(3)’ and ‘Pending for rejection u/r 7(7)’ till 30th Sep’20.

Notification by MCA of Extension of time_22042020  

RBI Governor Press Conference Highlights: Repo rate cut by 40 bps to 4%

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The Reserve Bank of India on Friday announced a surprise 40 basis points repo rate cut in an off-cycle policy review. RBI Governor Shaktikanta Das announced the decision of the Monetary Policy Committee at a press conference. He also said that the GDP growth for FY21 is expected to be in negative territory

The RBI Governor Shaktikanta Das announced a slew of measures aimed at further easing the liquidity conditions and providing relief to borrowers just a few days after the government concluded unveiling its five tranches of Rs 20 lakh crore worth of stimulus.

Staying true to what he had said earlier, RBI Governor came out for the third time with a set of measures to alleviate distress in the economy. The interventions included announcement on policy rates front with the Monetary Policy Committee holding an out of- cycle review meeting and extension of previously announced relief measures for both industrial establishments and individual borrowers.

The RBI was expected to follow up with monetary-side interventions after the government announced fiscal measures to cushion the economy from the Covid impact.

Key Takeaways:

Liquidity support: The RBI Governor Shaktikanta Das announced a 40 basis points repo rate cut. The MPC voted, with five of its six members in favour, for a reduction of repo rate by 40 basis points to 4 per cent from 4.4 per cent. Consequently, the reverse repo rate now stands at 3.35 per cent.

Moratorium extended: A further three-month extension up to August 31, 2020 on the following:

  1. Moratorium on term loan installments
  2. Deferment of interest on working capital
  3. Easing of working capital financing requirements by reducing margins
  4. Exemption from being considered as defaulter in supervisory reporting and reporting to credit information companies
  5. Extension of resolution for stressed assets, asset classification standstill by excluding moratorium period of three months.

Growth Outlook: On economic growth in the current fiscal, the RBI projected negative growth with a pick-up in growth impulses in second half. However, these depend on the trajectory of the pandemic.

Inflation Outlook: Headline inflation may fall below the RBI’s medium term target of 4% in third or fourth quarter of the current fiscal.

Demand & Supply: The governor said that the private consumption, which comprises 60 per cent of the GDP, has taken the biggest hit. Both the demand compression and supply disruption has taken a toll on the economy, the governor observed.

Foreign trade: Line of credit of Rs 15,000 crore for 90-days with roll over of up to one year so as to enable it to avail US dollar swap facility.

SIDBI: The special refinancing facility of Rs 15,000 cr to SIDBI at repo rate for 90 days for lending & refinance operations has been further rolled over for another 90 days at the end of initial 90 days period.

Income Tax Refunds of Rs. 26,242 crores issued since 1st April 2020: CBDT

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Income-tax refund of Rs 14,632 crore to 15,81,906 assesses and corporate tax refund amounting to Rs 11,610 crore to 1,02,392 assesses have been processed during this period, the CBDT said in a statement.

Income Tax Deptt. has issued refunds of Rs. 26,242 crores since 1st April 2020 to 16.84 lac individual/ corporate assessees. Further, the refund process has been geared up for necessary action to match the Aatma Nirbhar Bharat initiative (COVID-19) announced by PM/ FM recently.

CBDT Press Release dt. 22 May 2020

Central Board of Direct Taxes (CBDT) has issued tax refunds worth Rs. 26,242 crore to 16,84,298 assessees since 1st April, 2020 to 21st May, 2020.

Income Tax refunds amounting to Rs. 14,632 crore have been issued to 15,81,906 assessees and corporate tax refunds amounting to Rs. 11,610 crore have been issued to 1,02,392 assessees during this period.

It is stated that the refund process has been further expedited and refunds are being issued at a greater pace since the Union Finance Minister Smt. Nirmala Sitharaman’s announcement made in the Aatma Nirbhar Bharat Abhiyan last week. CBDT has released a sum of Rs. 2050.61 crore in the previous week ended on 16th May, i.e., between 9th to 16th May, 2020 to 37,531 income tax assessees and a sum of Rs. 867.62 crore to 2878 corporate tax assessees. During this week, i.e. between 17th to 21st May, 2020, yet another 1,22,764 income tax assessees were refunded Rs. 2672.97 crore and 33,774 corporate tax assessees including trusts, MSMEs, proprietorships, partnerships, etc. were issued refunds worth Rs. 6714.34 crore, taking the total amount refunded to Rs. 9387.31 crore in the case of 1,56,538 assessees.

Read the Press  Release

Google to invest in people and partnerships in India as it catches up with Azure, AWS in cloud

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Google will also leverage its advantage as a ‘data company’ and deploy technology as the key differentiator with expertise in areas such as Artificial Intelligence and Machine Learning

Technology behemoth Google is investing heavily in people and partnerships to grab a larger share of the Indian Cloud market, as it takes on global rivals Microsoft, IBM and Amazon Web Services in the country, a top company executive said.

Google will also leverage its advantage as a ‘data company’ and deploy technology as the key differentiator with expertise in areas such as Artificial Intelligence and Machine Learning, said Karan Bajwa, the newly appointed managing director of Google Cloud in India.

“The technology is right. The brand is right. Google’s hiring great talent and putting the right people in front of the customers, and there’s very strong investments happening on the Google Cloud across the world, as well as in India,” Bajwa told ET.

Only 20% of workloads have so far moved to the cloud and there is opportunity in the remaining 80% which has yet to migrate to public or private clouds, he said.

The ongoing economic crisis unleashed by the Covid-19 pandemic will fast track the shift as more companies look at cost efficiencies, Bajwa said.

Although IBM and Microsoft have a lead over Google in the cloud business, that was not a point of concern, he said.

“For 80% of the companies, the journey will start now, so the fact that somebody is ahead and somebody is behind, I honestly don’t worry about it.”

As capital becomes scarce going forward, people will want to conserve every dollar. “It’s going to move to an operational expense from a capital expenditure. So, there will be a faster acquisition of customers…,” he said.

Google will build a “differentiated partner strategy” compared to rivals. It will also leverage on its huge reach due to its dominance of Search and areas like payments and advertising, he said.

Over the last 60 days, “digital natives” have been looking to optimise existing technology, and companies that have so far not adopted the cloud are opening up to the opportunity due to cost pressures, he pointed out.

“We’ve always seen that incumbency is a strong advantage, Google’s incumbency has built the business in most of these organizations where Google is helping these customers acquire new customers, get into new markets, grow revenues, grow margins, and that’s a very strong incumbency than anyone else,” Bajwa, who was earlier IBM India head and who has had a long stint with Microsoft as its MD of sales and marketing, said.

Google will bet on building a team that wins top customers and competes with the dominant players, he said. “By the time we are done with Covid-19, we will be bringing on board very senior people from the industry who have led organizations and who have very strong credibility. That makes a huge difference as customers feel comfortable with the people they are buying from,” he said.

Last week, Google appointed Microsoft veteran Anil Bhansali as vice president of engineering.

Google already has a tie-up with Bharti Airtel for its cloud business and the search giant also recently announced a second cloud region in Delhi, after it launched the Mumbai region in 2017.

“We would not be making these investments in the tens of billions of dollars if we did not think we would make money with customers,” Bajwa added.

Source: Economic Times