Belated and Revised ITR Filing Date extended for AY 2020-21 to 31st May 2021 due to COVID-19

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COVID -19 relief for taxpayers.
Last chance to revise ITR for financial year 2019-20

In view of the adverse circumstances arising due to the severe Covid-19 pandemic and also in view of the several requests received from taxpayers, tax consultants & other stakeholders from across the country, requesting that various compliance dates may be relaxed, the Government has extended certain timelines on Saturday.

In the light of multiple representations received (supra) and to mitigate the difficulties being faced by various stakeholders, the Central Board of Direct Taxes (CBDT) has, under section 119 of the Income-tax Act, 1961(the Act), provided the following relaxation in respect of compliances by the taxpayers:

a) Appeal to Commissioner (Appeals) under Chapter XX of the Act, for which the last date of filing under that Section is 1st April, 2021 or thereafter, may be filed within the time provided under that Section or by 31st May, 2021, whichever is later;

b) Objections to Dispute Resolution Panel (DRP) under Section 144C of the Act, for which the last date of filing under that Section is 1st April, 2021 or thereafter, may be filed within the time provided under that Section or by 31st May, 2021, whichever is later;

c) Income-tax return in response to notice under Section 148 of the Act, for which the last date of filing of return of income under the said notice is 1st April, 2021 or thereafter, may be filed within the time allowed under that notice or by 31st May, 2021, whichever is later;

d) Filing of belated return under sub-section (4) and revised return under sub-section (5) of Section 139 of the Act, for Assessment Year 2020-21, which was required to be filed on or before 31st March, 2021, may be filed on or before 31st May, 2021;

e) Payment of tax deducted under Section 194-IA, Section 194-IB and Section 194M of the Act, and filing of challan-cum-statement for such tax deducted, which are required to be paid and furnished by 30th April, 2021(respectively) under Rule 30 of the Income-tax Rules, 1962, may be paid and furnished on or before 31st May, 2021;

f) Statement in Form No. 61, containing particulars of declarations received in Form No.60, which is due to be furnished on or before 30th April, 2021, may be furnished on or before 31st May, 2021.

The above relaxations are the latest among the recent initiatives taken by the Government to ease compliances to be made by the taxpayers with the aim to grant respite during these difficult times.

Read CBDT Circular dated 30 April, 2021

GST Collections surge to record Rs. 1.41 lakh crore in April

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The GST revenues during April 2021 are the highest since the introduction of GST even surpassing collections in the last month

The gross GST revenue collected in the month of April is at a record high of Rs. 1,41,384 crore of which CGST is Rs. 27,837 crore, SGST is Rs. 35,621, IGST is ₹68,481 crore (including Rs. 29,599 crore collected on import of goods) and Cess is Rs. 9,445 crore (including Rs. 981 crore collected on import of goods).

“Despite the second wave of COVID-19 pandemic affecting several parts of the country, Indian businesses have once again shown remarkable resilience by not only complying with the return filing requirements but also paying their GST dues in a timely manner during the month,” according to a statement by Ministry of Finance.

The GST revenues during April 2021 are the highest since the introduction of GST even surpassing collections in the last month (March’2021). In line with the trend of recovery in the GST revenues over past six months, the revenues for the month of April 2021 are 14% higher than the GST revenues in the last month of March’2021.

During the month, the revenues from domestic transaction (including import of services) are 21% higher than the revenues from these sources during the last month.

GST revenues have not only crossed the Rs. 1 lakh crore mark during successively for the last seven months but have also shown a steady increase. These are clear indicators of sustained economic recovery during this period.

Closer monitoring against fake-billing, deep data analytics using data from multiple sources including GST, Income-tax and Customs IT systems and effective tax administration have also contributed to the steady increase in tax revenue. Quarterly return and monthly payment scheme has been successfully implemented bringing relief to the small taxpayers as they now file only one return every three months.

Providing IT support to taxpayers in the form of pre-filled GSTR 2A and 3B returns and ramped up System capacity have also eased the return filing process.

During this month the government has settled Rs. 29,185 crore to CGST and Rs. 22,756 crore to SGST from IGST as regular settlement.

The total revenue of Centre and the States after regular and ad-hoc settlements in the month of April’ 2021 is Rs. 57,022 crore for CGST and Rs. 58,377 crore for the SGST.

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

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

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

6 Crucial changes in GST Rules applicable from January 1st, 2021

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The year 2021 has come up with the various changes in Goods and Service Tax (GST) Rules which will have a direct impact on the business registered under the GST regime and the businessmen who are planning to get themselves registered under GST.
 
Firstly, the CBIC has revised the extent of provisional Input Tax Credit (ITC) claims from 10% to 5%, with effect from 1 January 2021.
 

Firstly, the CBIC has revised the extent of provisional Input Tax Credit (ITC) claims from 10% to 5%, with effect from 1 January 2021. As per the sub-rule (4) inserted in rule 36 of the Central Goods and Service Tax Rules, 2017, a taxpayer filing GSTR-3B can claim ITC only to the extent of 5% of the eligible credit available in GSTR-2A. The amount of eligible credit is arrived upon those invoices or debit notes, the details of which have been uploaded by the suppliers in the GSTR-2A only. The new percentage applies from 1 January 2021 onwards. The ITC claim was earlier restricted to 10% between 1 January 2020 and 31 December 2020 whereas it was 20% for the period from 9 October 2019 till 31 December 2019.

Secondly, the CBIC has amended the Rule 21, which is in respect of the suspension or cancellation of GST Registration. The amendment inserted the additional situation wherein the registration of a person can be suspended if he avails input tax credit in violation of the provisions of section 16 of the Act or the rules; or furnishes the details of outward supplies in FORM GSTR-1 for one or more tax periods which is in excess of the outward supplies declared by him in GSTR 3B for the said tax periods, or violates the provision of rule 86B.

Thirdly, the Board inserted Rule 86B wherein all the registered persons have to pay 1% cash liability so as to curb tax evasion by way of fake invoicing. The Rule 86B is applicable to only those registered persons whose value of taxable supply, other than exempt supply and export, in a month exceeds Rs 50 lakh that means those whose annual turnover is more than 6 crore.

For example, if a dealer has made a sale of Rs 1 crore of the goods whose tax rate is 12% and if he is discharging his tax liability more than 99% though ITC, then he has to pay only Rs.12,000 under this rule. On the other hand, a composition dealer would have paid Rs.1 lakh in cash with this volume of sale.

Fourthly, the CBIC has amended Rule 8 and 9 which pertained to New GST Registration, which provides for the biometric verification i.e. Aadhaar authentication and taking photographs or taking biometric information, photograph and verification of such other KYC documents for the applications for new registration.

However, in the case of those opting not to use Aadhaar, GST registration would be given only after physical verification of the business premise, which could take upto 21 days and in case a notice is issued, even more time.

Fifthly, the Board has amended Rule 59, not to permit the taxpayer to file GSTR 1 if the taxpayers have not furnished the return in FORM GSTR-3B for the preceding two months (for a taxpayer filing monthly returns); he has not furnished the return in FORM GSTR-3B for preceding tax period (for a taxpayer filing quarterly returns) and he is required to discharge the tax liability of at least 1% by cash (see the discussion on Rule 86B) and he has not furnished the return in FORM GSTR-3B for preceding tax period instead of two months.

Sixthly, the CBIC has amended Rule 138(10) which related to E-way Bill wherein the available travel time has been enhanced to 200 Kms. For example, goods dispatched to the destination located at a distance of 550 kms have taken place on February 1, 2021. As per the existing rule, the validity of the E-way bill generated would have expired on February 7, 2021, i.e. one day for 100km starting from the midnight of the generation of the E-way bill. However, as per the amendment, the e-way bill will expire on February 4, 2021, and hence the goods must reach the destination within the time frame.