As part of Government of India’s Ease of Doing Business (EODB) initiatives, the Ministry of Corporate Affairs would be shortly notifying & deploying a new Web Form christened ‘SPICe+’ (pronounced ‘SPICe Plus’) replacing the existing SPICe form.
SPICe+ would save as many procedures, time and cost for Starting a Business in India and would be applicable for all new company incorporation w.e.f 15th February 2020
Key Features of Spice+
SPICe+ would be an integrated Web Form i.e. fill form online like GST registration forms. The new web form would Facilitate on-screen filing and real time data validation for seamless incorporation of companies.
Information once entered can be saved and modified. All Check form and Pre-scrutiny validations will happen on web form itself.
DSC validation and other validations will happen at Upload Level
Once the SPICe+ is filled completely with all relevant details, the same would then have to be converted into pdf format, with just a click of the mouse button, for affixing DSCs.
Digitally signed applications can then be uploaded along with the linked forms as per the existing process.
Changes/modifications to SPICe+ (even after generating pdf and affixing DSCs), can also be done by editing the same web form
Spice+ would have 2 parts:
a) Part A : for name reservation for new incorporation
b) Part B : Part B offering a bouquet of services i.e.
Incorporation
DIN allotment
Mandatory issue of PAN / TAN
Mandatory issue of EPFO / ESIC registration
Mandatory issue of Profession Tax registration (Maharashtra)
Mandatory Opening of Bank Account for the Company
Allotment of GSTIN (if so applied for)
Part A can be filed first for reserving name or Part A & B can be filed together at one go.
Re submission would be easy, if required.
Registration for EPFO and ESIC shall be mandatory for all new companies incorporated w.e.f 15 February 2020 and no EPFO & ESIC registration nos. shall be separately issued by the respective agencies.
Registration for Profession Tax shall also be mandatory for all new companies incorporated in the State of Maharashtra w.e.f 15th February 2020.
All new companies incorporated through SPICe+ (w.e.f 15th February 2020) would also be mandatorily required to apply for opening the company’s Bank account through the AGILE-PRO linked web form.
Declaration by all Subscribers and first Directors in INC-9 shall be auto-generated in pdf format and would have to be submitted only in Electronic form in all cases, except where:
Total number of subscribers and/or directors is greater than 20 and/or
Any such subscribers and/or directors has neither DIN nor PAN
In the union budget 2020, the following section 115BAC shall be inserted in the Income Tax Act, with effect from the 1st day of April, 2021, with new income tax slabs and lower rates. These income tax rates are optional and are available to those who are willing to forego some exemptions and some deductions.
Direct Taxes
1. Tax rate reduced for new companies to 22% and for manufacturing companies 15%
2. New simplified personal tax regime for Individual tax payers. The revised slab can be availed if they do not claim deductions and certain exemptions.
For income :
Upto 5,00,000 nil
Rs 5,00,000 -7,50,000: 10%
Rs 7,50,000 – 10,00,000 : 15%
Rs10,00,000 – Rs 12,50,000 20%
Rs 12,50,000- Rs 15,00,000 : 25%
More than Rs 15,00,000 : 30%
3. Companies not required to deduct dividend distribution tax and will be taxed only in the hands of the recipient. Parent company to be allowed deduction of dividend received subsidiary
4. Concessional tax rate of 15% extended to power generation companies
5. Investment made in Infrastructure and other specified sectors
6. Tax rate of 194LC at 5% for interest payment to non resident in respect of money borrowed or bond issued upto June 30,2023 and for 194LD at 5% for interest on borrowing from foreign institutional or qualified investor and municipal bonds
7. Interest payment on bonds listed on exchange by ILFS – 4%
8. Option to Cooperative societies to pay tax at 22% with no exemption or deduction. Exempt from alternative minimum tax
9. Affordable housing tax breaks extended by one year. Additional 1.5 lakhs tax benefit on interest paid on affordable housing loans to March 2021
10. Turnover threshold for tax audit raised to Rs 5 crore from Rs 1 crore
11. 100% tax concession to sovereign wealth funds on investment in infra projects
12. Income from Charitable institutions fully exempt from taxation. Donation to such institution allowed as deduction.
13. Registration of charity institutions to be made completely electronic, donations made to be pre-filled in IT return form to claim exemptions for donations easily.
14. Faceless appeals against tax orders on lines of faceless assessments
15. For tax payers who have appeals pending only disputed tax is to be paid by tax payer and no interest or penalty if the same is paid within March 31,2020. Post March 31,2020 certain amount levied uptill June 30,2020
16. Startup ESOP taxes deferred by 5 years Other Areas
1. New scheme to provide subordinate debt to MSME
2. Decriminalise some norm violations in Companies Act
3. Increase the bank deposit insurance from Rs 1 lakh to Rs 5 lakh
4. New system for instant allotment of PAN
5. A new scheme NIRVIK to be launched this year itself for exporters
6. A debt ETF consisting of government securities will be launched.
7. For NBFCs and HFCs, liqduity constraints will be addressed.
8. FPI Limit in corporate bonds will be raised to 15% from 9%.
9. LIC to be listed at stock exchanges
Two important changes in Income tax (TDS/TCS)
— TCS to be collected by seller whose turnover exceeds Rs. 10 cr. In previous year from each buyer on amount exceeding 50 lacs @0.1% for sale of goods.
-TDS rate u/s 194J for technical payment changed from 10% to 2% to avoid litigations in respect of 194J Vs 194C
On a day when the Economic Survey acknowledged the fact that both GST system is complex, taxpayers found it impossible to file their returns.
The Central Board of Indirect Taxes and Customs (CBIC) late on Friday night extended the due date for furnishing GST Annual Return and Reconciliation Statement (GSTR-9 / 9A and GSTR-9C) for FY 2017-18 in a staggered manner. The last date to file the Returns was January 31, 2020.
This came after thousands of taxpayers took to social media complaining about the GST portal not working. “Considering the difficulties being faced by taxpayers in filing GSTR-9 and GSTR-9C for FY 2017-18 it has been decided to extend the due dates in a staggered manner for different groups of States to 3rd, 5th and 7th February 2020 as under,” CBIC said in a Tweet.
Accordingly under Group 1, the states of Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Puducherry, Telangana, Andhra Pradesh, Other Territory has been placed and they will need to file their returns by 3rd February 2020.
Group 2 includes Jammu and Kashmir, Himachal Pradesh, Punjab, Chandigarh, Uttarakhand, Haryana, Delhi, Rajasthan and Gujarat that have to file by 5th February 2020.
Lastly group 3 includes the states of Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Andaman & Nicobar Islands, Jharkhand, Odisha, Chhattisgarh, Dadra and Nagar Haveli and Daman and Diu, Lakshadweep, Madhya Pradesh, and Uttar Pradesh, which now have to file by 7th February 2020.
On a day when the Economic Survey acknowledged the fact that both GST system is complex, taxpayers found it impossible to file their returns. By evening of January 31, #gstnfailed was the top trend on Twitter. At 10 30 pm CBIC tweeted the extension dates, but early reports suggest the portal is still not working.
– The Central government will provide required approvals to such companies for winding up instead of the tribunal – MCA notifies the Companies (Winding Up) Rules, 2020, vide Notification dt. 24 January 2020, comprising of Rules 1 to 191 and Forms WIN 1 to WIN 95, applicable for winding up under the Companies Act 2013 w.e.f. 1 April, 2020
The Ministry of Corporate Affairs (MCA) on Tuesday notified rules for winding up of companies, making it easier for smaller firms to wind up businesses without taking approval.
The rules have provided summary procedures for liquidation of companies with asset size of Rs 1 crore and which have not accepted deposits exceeding Rs 25 lakh and turnover less than Rs 50 crore and total loan under Rs 25 lakh.
The Central government will provide required approvals to such companies for winding up instead of the tribunal.
The rules said, “…wherever the word Tribunal is mentioned, it shall be read as Central Government and with further directions issued by the Central Government as may be necessary, from time to time.”
G.S.R. (E).- In exercise of the powers conferred by sub-sections (1) and (2) of section 468 and sub-sections (1) and (2) of section 469 of the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the following rules, namely:-
Part 1: GENERAL
1. Short title, commencement and application.-
(1) These rules may be called the Companies (Winding Up) Rules, 2020.
(2) They shall come into force on the 1st day of April, 2020.
(3) These rules shall apply to winding up under of Companies Act 2013 (18 of 2013).
2. Definitions.-
In these rules, unless the context or subject matter otherwise requires, –
(a) “Act” means the Companies Act, 2013 (18 of 2013);
(b) “Form” means a Form annexed to these rules;
(c) “Registrar” means the Registrar of the National Company Law Tribunal or National Company Law Appellate Tribunal and includes such other officer of the Tribunal or Bench thereof to whom the powers and functions of the Registrar are assigned;
(d) “Registry” means the Registry of the Tribunal or any of its Benches or of the Appellate Tribunal, as the case may be, which keeps records of the applications and documents relating thereto;
(e) “Section” means section of the Act;
(f) words and expressions used and not defined in these rules but defined in the Act shall have the meanings respectively assigned to them in the Act.
Part II: WINDING UP BY TRIBUNAL
3. Petition for winding up.-
(1) For the purposes of sub-section (1) of section 272, a petition for winding up of a company shall be presented in Form WIN 1 or Form WIN 2, as the case may be, with such variations as the circumstances may require, and shall be presented in triplicate.
(2) Every petition shall be verified by an affidavit made by the petitioner or by the petitioners, where there are more than one petitioners, and in case the petition is presented by a body corporate, by the Director, Secretary or any other authorised person thereof, and such affidavit shall be in Form WIN 3.
4. Statement of affairs.- The statement of affairs, as required to be filed under sub-section (4) of section 272 or sub-section (1) of section 274, shall be in Form WIN 4 and shall contain information up to the date which shall not be more than thirty days prior to the date of filling the petition or filling the objection as applicable and the statement of affairs shall be made in duplicate, duly verified by an affidavit, and affidavit of concurrence of the statement of affairs shall be in Form WIN 5.
5. Admission of petition and directions as to advertisement.- Upon filing of the petition, it shall be posted before the Tribunal for admission of the petition and fixing a date for the hearing thereof and for appropriate directions as to the advertisements to be published and the persons, if any, upon whom copies of the petition are to be served, and where the petition has been filed by a person other than the company, the Tribunal may, if it thinks fit, direct notice to be given to the company and give an opportunity of being heard, before giving directions as to the advertisement of the petition, if any, and the petitioner shall bear all costs of the advertisement.
6. Copy of petition to be furnished.- Every contributory of the company shall be entitled to be furnished by the petitioner or by his authorised representative with a copy of the petition within twenty four hours of his requiring the same on payment of five rupees per page.
7. Advertisement of petition.- Subject to any directions of the Tribunal, notice of the petition shall be advertised not less than fourteen days before the date fixed for hearing in any daily newspaper in English and vernacular language widely circulated in the State or Union territory in which the registered office of the company is situated, and the advertisement shall be in Form WIN 6.
8. Application for leave to withdraw petition.-
(1) A petition for winding up shall not be withdrawn after presentation without the leave of the Tribunal subject to compliance with any order of the Tribunal, including as to costs.
(2) An application for leave to withdraw a petition for winding up which has been advertised in accordance with the provisions of rule 7 shall not be heard at any time before the date fixed in the advertisement for the hearing of the petition.
Changes under the GST applicable for New Year 2020
E-invoice : New E-invoicing system is going to be implemented in GST which is mandatory from 1st April 2020 for taxpayers having an annual turnover exceeding Rs. 100 crore and then gradually to all B2B suppliers in the future. A mechanism for the continuous upload of revenue invoices on a real-time basis. This is the most remarkable change coming in Indian Book Keeping.
New IRP in GST: Invoice Registration Portal would be introduced this new year. IRP shall make an e-invoice of the invoices uploaded by the supplier. IRP shall send the e-invoice to the supplier and recipient. IRP shall send e-invoices data to GSTN portal
New Return: New simplified auto-mated GST returns would be implemented from 1st April 2020 for all taxpayers. This new returns system will increase compliance and reduce tax evasion to a larger extent.
Annexure 1 and Annexure 2: Anx-1 of Outward Supplies and Anx-2 of Inward Supplies will be the future base for filing of all GST Returns, thus these 2 reports will be the key for future reports of GST which will replace GSTR 1 and GSTR-2A.
Restriction on claim of ITC: With effect from 01/01/2020, ITC in respect of invoices or debit notes that are not reflected in taxpayer’s FORM GSTR-2A shall be restricted to 10 percent of the eligible ITC reflected in his FORM GSTR-2A. Earlier the restriction was 20%. A major change in ITC availment.
E-way Bill and GSTR-1: From 11th January, 2020 non-filing of GSTR-1 for two consecutive periods would block generation of E-way Bill. Thus, regular filing of GSTR-1 and GSTR-3B in year 2020 should go hand in hand.
Waiver of late fees for Non-filing of GSTR-1: If the taxpayer has failed to file GSTR-1 from July 2017 to November 2019, then the taxpayers can file such returns till 10 January, 2020 and the late fees for the same has been waived of. This will also affect GSTR-2A of the recipient to claim ITC.
GST Audit and Annual Return: The due date for filing GST Annual Return and Audit Report for F.Y. 2017-18 has been further extended to 31st January, 2020.The due date for filing GST Annual Return and Audit Report for F.Y 2018-19 has been extended to 31st March, 2020. For F.Y 2019-20 new format may be brought in because of inherent limitations in current forms.
DIN notices and E-scrutiny: Due to decline in collection of revenue from GST, large scale e-scrutiny and e-assessment notices with DIN for the returns from July 2017 may be taken up. It would be done in order to check significant deviations in returns.
GSTN Network is proposed to be reengineered for more taxpayer-centric services like reminder of return filing, status of refund, ITC matches and mismatches, etc.
Taxpayers get one more chance to clear their tax dues.
The CBDT has extended till January 31 the last date for taxpayers to avail a “one-time” facility to apply for compounding of income tax offences, an order issued on Friday said.
The earlier deadline was December 31, 2019.
In I-T parlance, compounding means that the taxman does not file a prosecution case against the offender or tax evader in court in lieu of payment of due taxes and surcharges.
The decision to extend the last date was taken “in view of references received from field formations, including requests made by ICAI (Institute of Chartered Accountants of India) chapters wherein it has been brought to the notice of the CBDT that the taxpayers could not avail the benefit of the one-time relaxation window due to genuine hardships,” the order issued by the Central Board of Direct Taxation (CBDT) said.
The order was accessed by PTI.
Final opportunity
Hence, the order stated, the date has been extended to give a final opportunity to such taxpayers and reduce the pendency of existing prosecution cases before the courts.
Applications, as per the procedure of the scheme, are to be filed before the appropriate competent authority that is either a principal chief commissioner or a chief commissioner or a principal director general or director general of the Income-Tax Department “on or before” January 31, 2020.
The CBDT, while launching the scheme in September last year, had said that this “one-time measure” is being undertaken to mitigate unintended hardship to taxpayers in deserving cases and to reduce the pendency of existing prosecution cases before the courts.
“Cases have been brought to the notice of CBDT where the taxpayers could not apply for compounding of the offence as the compounding application was filed beyond 12 months,” it had said.
The riders
The relaxation, however, shall not be available in respect of an offence which is generally or normally not compoundable, indicating instances of serious tax evasion, financial crime, terror financing, money laundering, possession of illegal foreign assets, benami properties or conviction by a court in the past.
The CBDT circular added that application for compounding of an income tax offence can be filed in cases where: Prosecution proceedings are pending before any court of law for more than 12 months or any compounding application for an offence filed previously was withdrawn by the applicant solely for the reason that such application was filed beyond 12 months or any compounding application for an offence had been rejected previously solely for technical reasons.
The CBDT, which frames policy for the tax department, had earlier said that compounding of offences is “not a matter of right” and the department can extend such a relief only in certain cases.
This will be done keeping in view factors like “conduct of the person, the nature and magnitude of the offence on the context of the facts and circumstances of each case,” it had said.
Late fee to be waived on GSTR-1 if filed by Jan 10, 2020
The Goods and Services Tax (GST) council has decided to waive off late fees for all taxpayers who have filed GSTR 1, if all refunds are filed by 10 January 2020.
In the 38th meeting of the GST Council on December 18, authorities had also waived of a late fee to be given all taxpayers in respect of all pending Form GSTR-1 from July 2017 to November 2019, if the same is filed by January 10th, 2020.
According to CBIC, the late fee waiver will be applicable only till 10 January 2020, beyond which a late fee of at least Rs 50 per day will be charged for non-filing of GSTR-1.
The late fine can also go up to a maximum of Rs 10,000 per statement as per existing provisions. The CBIC has also said that the government has planned to take a number of steps if the pending GSTR-1 is not filed by the 10th of next month, which may include steps such as blocking of the E-way bill, etc.
GSTR-1 is a monthly return that summarizes all sales (outward supplies) of a taxpayer. The due dates for GSTR-1 are based on turnover. Businesses with sales of up to Rs. 1.5 crore will file quarterly returns. Other taxpayers with sales above Rs. 1.5 crores have to file monthly return.
As part of Government of India’s Ease of Doing Business (EODB) initiatives, the Ministry of Corporate Affairs would be shortly notifying & deploying a new Web Form christened ‘SPICe+’ (pronounced ‘SPICe Plus’) replacing the existing SPICe form.
In the union budget 2020, the following section 
