Cabinet approves MoU between ICAI and Chartered Accountants Australia and New Zealand

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This provides an opportunity to the ICAI members to expand their professional horizons and to foster working relations between the two accounting institutes.
The Institute of Chartered Accountants of India (ICAI) and Chartered Accountants Australia and New Zealand (CA ANZ) will have an opportunity to play the leadership role in addressing new challenges facing the profession in a globalized environment.

The Cabinet, chaired by Prime Minister Shri Narendra Modi, has approved a fresh Memorandum of Understanding (MoU) between the Institute of Chartered Accountants of India (ICAI) and Chartered Accountants Australia and New Zealand (CA ANZ).

Impact:

The MOU intends to develop mutually beneficial relationship in the best interest of members, students and their organizations and is expected to provide an opportunity to the ICAI members to expand their professional horizons and to foster working relations between the two accounting institutes. The two accountancy institutes will have an opportunity to play the leadership role in addressing new challenges facing the profession in a globalized environment.

Benefits:

The engagement between the two Institutes is expected to result in greater employment opportunities for Indian Chartered Accountants and also greater remittances back to India.

Details:

The Memorandum of Understanding (MoU) between the Institute of Chartered Accountants of India (ICAI) & Chartered Accountants Australia and New Zealand (CA ANZ) would mutually recognize the qualification and admit the Members in good standing by prescribing a bridging mechanism between the two Institutes. The ICAI and CA ANZ aim to establish a mutual co-operation framework for the advancement of accounting knowledge, professional and intellectual development, advancement of the interests of their respective members and contribute positively to the development of the accounting profession in Australia, New Zealand and India.

Implementation strategy and Targets:

The MoU provides for mutual recognition of qualification of members of other body, who have achieved membership by completing the Examination, professional program and practical experience membership requirements of the two parties.

Background:

The Institute of Chartered Accountants of India (ICAI) is a statutory body established by an Act of Parliament of India, The Chartered Accountants Act, 1949′, to regulate the profession of Chartered Accountancy in India. Chartered Accountants Australia and New Zealand (CA ANZ), emerged from the merger of the Institute of Chartered Accountants in Australia and the New Zealand Institute of Chartered Accountants in October 2014.

Source: Cabinet approves MoU between The Institute of Chartered Accountants of India (ICAI) and CAANZ and MRA between ICAI and CPA Australia (21-04-2021)

Key changes in new ITR forms for AY 2021-22

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Only the bare minimum changes necessitated due to amendments in the Income-tax Act, 1961 have been incorporated in the forms, CBDT said in the notification for the new ITR forms, in view of the ongoing crisis due to COVID-19 pandemic.

Keeping minimum change and with the view to minimise compliance burden, The Central Board of Direct Taxation (CBDT) has notified new income tax return forms — ITR-1 to ITR-7,  for the Assessment Year 2021-22, the ministry of finance said in a statement on April 1.  

In this new ITR form for AY 2021-22, the taxpayers will now have dedicated space in each of the ITR forms — Sahaj (ITR-1), Form ITR-2, Form ITR-3, Form ITR-4 (Sugam), Form ITR-5, Form ITR-6, Form ITR-7 and Form ITR-V to describe their investments, CBDT said. 

ITR Form 1 (Sahaj) and ITR Form 4 (Sugam) are simpler Forms that cater to a large number of small and medium taxpayers. Sahaj can be filed by an individual having income up to Rs 50 lakh and who receives income from salary, one house property / other sources (interest etc). 

Similarly, Sugam can be filed by individuals, Hindu Undivided Families (HUFs) and firms (other than Limited Liability Partnerships (LLPs) having total income up to Rs 50 lakh and income from business and profession computed under the presumptive taxation provisions. 

Individuals and HUFs not having income from business or profession (and not eligible for filing Sahaj) can file ITR-2, while those having income from business or profession can file ITR Form 3. 

Persons other than individual, HUF and companies i.e. partnership firm, LLP etc can file ITR Form 5. Companies can file ITR Form 6. Trusts, political parties, charitable institutions etc claiming exempt income under the Act can file ITR-7. 

There is no change in the manner of filing of ITR forms as compared to last year, the CBDT said. 

Key points :

♦ ITR-1 cannot be filed in case tax has been deducted u/s 194N

As per, Section 194N – TDS 194N is required to be deducted if amount of cash withdrawn exceeds –

  • Exceeds Rs 20 lakhs in case of non-filers of return
  • Rs 1 crore in all other cases

from banking company or co-operative bank or post-office from one or more accounts maintained by taxpayer.

If tax has been deducted u/s 194N, a person can file –

  • ITR 2
  • ITR 3
  • ITR 4

♦ TDS deducted u/s 194N cannot be carried forward to subsequent years.

It means Credit for tax deducted u/s 194N can be taken in previous year relevant to Assessment year in which tax has been deducted.

♦ Option has been given to Individual or HUF as per Section 115BAC.

From A.Y 2021-22 option is available to Individual & HUF whether to opt New Scheme or not. This option for lower tax regime, by foregoing certain exemptions and deductions, is given to Assessees to select new scheme-Section 115BAC and are required to file Form-10IE before filing the return u/s 139(1).

♦ Change in Schedule 112A-LTCG from sale of equity share or unit of equity oriented fund on which STT is paid.

Sale price per share/unit now added in Schedule 112A, which was not earlier provided.

♦ Dividend also taxable from A.Y 2021-22- As we know Dividend Income taxable from A.Y 2021-22 in hands of Assessee from A.Y 2021-22 so we are required to give quarterly break-up of Dividend received in order to get relief from interest levied u/s 234C.

♦ Changes in Section 44AB- The threshold limit to get books of account audited increased from Rs 1 crore to 10 crores, if the following conditions are satisfied-

  1. His aggregate of all receipts in cash during the previous year does not exceeds 5 % of such receipts.
  2. His aggregate of all payments in cash during the previous year does not exceeds 5 % of such payments

New MCA rules make cryptocurrencies, benami, loan disclosures mandatory

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Starting April 1, companies must state if they have been declared wilful defaulters by banks, financial institutions or other lenders. The ministry also mandated companies to record audit trails of their accounts. Firms using accounting software to maintain their books need to use features that can record the audit trail of each transaction and create an edit log, including the date of such changes.

India Inc will have to declare investments in cryptocurrencies, relationships with dissolved companies and loans extended to related parties, among a host of other disclosures mandated by the government to improve transparency.

Starting April 1, companies must state if they have been declared wilful defaulters by banks, financial institutions or other lenders.

 The ministry of corporate affairs announced a new set of disclosures rules under the Companies Act on Wednesday, significantly enhancing financial and general reporting requirements for companies.

The ministry also mandated companies to record audit trails of their accounts. Firms using accounting software to maintain their books need to use features that can record the audit trail of each transaction and create an edit log, including the date of such changes.

Amending the Companies (Accounts) Rules, the ministry said firms must ensure the audit trail feature on the accounting software cannot be disabled. The move is aimed at curbing backdated entries and will affect mainly smaller companies as the bigger ones already use such software, according to Shalu Kedia, a partner at Nangia & Co.

Additional disclosures to be made under schedule III of the Companies Act, 2013, relate to matters such as corporate social responsibility spending, cryptocurrency dealings, benami property, relationship with struck-off, or dissolved, companies, and ageing of payables & receivables with vendors.

These disclosures will make it easier for the government to track non-compliance and take action against defaulting companies, experts said.

“Earlier, the companies were only required to disclose trade payables and receivables, but there was no requirement to provide ageing details. This disclosure will mandate the company to disclose the ageing payment cycle for MSMEs and non-MSME vendors,” said Nischal Arora, a partner at Nangia Andersen LLP.

Dealings in cryptocurrencies must be disclosed with details of the profit or loss on such transactions, amounts of such currency held and deposits or advances from any person for trading or investing in these currencies.

“While the government is already working on a bill on cryptocurrency, the disclosure for such currency has made it clear that the government wants to gather data on cryptocurrency,” said Arora.

Another important change was related to the disclosure of any benami property holdings.

“This disclosure is another step to improve transparency for the stakeholders as they will have to disclose any proceeding that has been initiated or pending against the company for holding any benami property and also provide a reasoning and view on the same,” said Amit Maheshwari, a partner at AKM Global.

The additional disclosures will make it mandatory for companies to provide details of shortfall in CSR spending for the previous years, including reasons for not meeting targets.

Loans granted to promoters, directors and related parties that are repayable on demand or without specific repayment terms from companies must be declared in terms of amount and percentage to total loans granted.

While this will push firms to regularly service their loans, it “will be helpful for the investor and other lenders to be aware about these types of companies before making any investment or lending the money,” Maheshwari said.

Schedule III Amendment Notification_24032021

Source: Economic Times

MCA establishes Central Scrutiny Centre for scrutiny of Straight Through Processes (STP) e-forms

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Use of analytics and AI augment India’s vision for #aatmanirbharta & development                  Plan to come up with a machine learning driven MCA-21 Version 3.0 is in process: Budget 2021

In the Budget 2021, it was mentioned that govt. will be establishing technology based on data analytics, artificial intelligence, machine learning tools in the areas of finance, taxation and online compliance monitoring among others.

Accordingly, MCA has now established a Central Scrutiny Centre (CSC) for carrying out scrutiny of Straight Through Processes (STP) e-forms filed by the companies under the Company Law made thereunder.

The Ministry of Corporate Affairs established a Central Scrutiny Centre (CSC) for carrying out scrutiny of Straight Through Processes (STP) e-forms filed by the companies under the Act and the rules.

The notification said that the CSC shall function under the administrative control of the e-governance Cell of the Ministry of Corporate Affairs.

The CSC shall carry out scrutiny of the aforesaid forms and forward findings thereon, wherever required, to the concerned jurisdictional Registrar of Companies for further necessary action under the provisions of the Act and the rules made thereunder.

“The CSC shall be located at the Indian Institute of Corporate Affairs (IICA), Plot No. 6, 7, 8, Sector 5, IMT Manesar, District Gurgaon (Haryana), Pin Code- 122050,” the MCA notified.

The notification shall come into force from the 23rd March, 2021.

Read the MCA CSC Notification

Year-long IBC suspension to be lifted ‘after March 24’, hints MCA

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The Ministry for Corporate Affairs Ministry has hinted that the suspension of the Insolvency and Bankruptcy Code (IBC) is likely to be revoked after March 24.

he Ministry for Corporate Affairs Ministry has hinted that the suspension of the Insolvency and Bankruptcy Code (IBC) is likely to be revoked after March 24.

This has been conveyed in a written submission by the Ministry to the Standing Committee on Finance headed by Jayant Sinha. This submission came along with the note on allocation and utilisation of funds for the Insolvency and Bankruptcy Board of India (IBBI), which is the insolvency regulator.

“It is expected that the suspension of the Insolvency and Bankruptcy Code will likely be revoked after March 24 and activities of IBBI will be increased manifold in the next financial year,” the MCA submission said.

Given that the economy is now in recovery mode, it is widely expected that the Centre will revoke the suspension after March 24. Also, any extension of the suspension this date would require Parliament approval, legal experts said.

6-month suspension

A six-month suspension was first introduced in June 5 for debt defaults arising post March 25, 2020, when the Covid-induced lockdown was announced. The suspension was to end on September 25, but was extended up to December 25. In mid-December, the suspension was further extended by three months, up to March 25.

In effect, the government had ensured that any corporate debt default during Covid, between March 25, 2020 and March 25, 2021, will remain outside the IBC purview. However, for defaults before March 25, 2020, there will be no protection, said experts.

While the law protects the corporate debtor from insolvency proceedings for the one-year period till March 25, it does not disallow such action against the personal guarantors of a corporate debtor.

‘Go digital’

In a separate development, the Standing Committee on Finance has, in its latest report tabled in the Lok Sabha on Tuesday, directed the MCA to move towards full digitisation of its functions, particularly of its statutory bodies. It sees the quasi judicial bodies facing a deluge of cases post withdrawal of the moratorium and underscored stressed the need to enhance their digital and infrastructural capacities to handle the increase in caseload.

Source: Business Line

Extension of due date for furnishing of Annual Returns GSTR-9 and GSTR-9C for financial year 2019-20 to March 31, 2021

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CBIC had extended, vide Press Note regarding extension of due date for furnishing of Annual Returns GSTR-9 and GSTR-9C for financial year 2019-20 to March 31, 2021.

This is the second extension given by the government. The deadline was earlier extended from December 31,2020 to February 28.

Companies get relaxation for Annual Filings of 2019-20 upto 15/02/2021 without additional fees.

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MCA relaxes levy of additional fees in filing of e-forms AOC-4, AOC-4 (CFS), AOC-4 XBRL and AOC-4 Non-XBRL for the financial year ended on 31.03.2020 under the Companies Act, 2013

Keeping in view of various requests received from stakeholders regarding relaxation on levy of additional fees for annual financial statement filings required to be done for the financial year ended on 31.03.2020, it has been decided that no additional fees shall be levied upto 15.02.2021 for the filing of e-forms AOC-4, AOC-4 (CFS), AOC-4 XBRL and AQC-4 Non-XBRL in respect of the financial year ended on 31.03.2020.

During the said period, only normal fees shall be payable for the filing of the aforementioned e-forms.

Earlier, the Annual General Meeting for adoption of the Audited Financial Statements, Directors Report and Auditors’ Report was extended by 3 months from September 30 to December 30, 2020.

Accordingly, the companies were required file Audited Financial Statements before January 31st, 2021.

This has now been further relaxed for another 15 days up to February 15, 2021, for filing of the eForms with Ministry of Corporate affairs (MCA).

Read the MCA Circular for waiver of Additional Fees