Forex reserves hit record high at $359.917 bn

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India’s foreign exchange reserves continue to rise to hit a record level of $359.917 billion as on April 8, data from the Reserve Bank of India (RBI) show.

India’s foreign exchange reserves continue to rise to hit a record level of $359.917 billion as on April 8, data from the Reserve Bank of India (RBI) show.

The central bank data show that in the week-ended April 8, India’s forex reserves rose by $157.40 million from the previous week.

As on April 8, foreign currency assets (FCA), which forms a key component of the reserves rose by $159.3 million from the previous week to $335.845 billion. FCA are maintained in major currencies like US dollar, euro, pound sterling, yen, etc. However, the foreign exchange reserves are denominated and expressed in US dollar only.

The movements in the FCA occur mainly on account of purchase and sale of foreign exchange by the RBI in the foreign exchange market in India, income arising out of the deployment of the foreign exchange reserves, external aid receipts of the central government and revaluation of the assets.

Gold reserves, however, remained unchanged at $20.115 billion. Special drawing rights (SDR) from the International Monetary Fund fell by $0.90 million from the previous week to $1.501 billion.

SDR is an international reserve asset created by IMF and allocated to its members in proportion of the members’ quota at IMF. The country’s reserve position in the IMF, however, fell by $1 million to $2.455 billion.

Source: http://www.financialexpress.com/article/industry/banking-finance/forex-reserves-hit-record-high-at-359-917-bn/237598/

MCA21 woes: Government extends filing deadline for stakeholders

by | posted in: Company Incorporations, e-filing of MCA Returns, Corporate Updates | 0

MCAWith stakeholders facing glitches in using the upgraded MCA21 portal, the Corporate Affairs Ministry has extended the deadline for submitting various filings without additional fee till May 10.

MCA21, used for making electronic filings under the Companies Act, is managed by InfosysBSE -0.87 % for the ministry. The upgraded system went live in the last week of March.

“Since the launch of the system, a number of stakeholders have faced issues and representations have been received from stakeholders to resolve the issues including, for allowing waiver of additional fee until the new system stabilises,” the ministry said in a communication.

Considering the situation, the ministry has decided to relax the additional fee payable on electronic forms which are due for filing by companies between March 25 to April 30 as one time waive additional fee.

“If such due e-forms are filed after May 10, 2016, no such relaxation shall be allowed,” the communication, dated April 12, said.

After upgradation to run on SAP platform, MCA21 went live on March 27, and since then there have been some glitches such as difficulty in uploading documents.

On April 6, an Infosys spokesperson had said it was working with the ministry to resolve the “minor teething problems” related to MCA21.

The portal is designed to fully automate all processes related to enforcement and compliance of legal requirements under the Companies Act.

Source:   http://economictimes.indiatimes.com/articleshow/51843322.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

Lending for small companies is a $300 million business

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While bigger SME lending players like Lending Kart and Capital Float aim to close their next funding rounds, a slew of smaller players have emerged in the last year viewing the space as a segment where at least 10 strong players can coexist.

Amongst the new players, Puneet Dalmia-backed CoinTribe, which was launched in February, uses a proprietary algorithm to link up multiple data sources ranging from the credit bureau to social media determining the credit worthiness of an SME within minutes. The startup has tied up with private sector banks that use their platforms to process SME loans.

“Our ticket size for loans range between Rs 30,000 to Rs 20 lakh. We offer an interest rate of 13-18% and receive upto 30 applications on a daily basis,” said Amit Sachdev, cofounder at CoinTribe. The fintech player has an acceptance rate ranging between 25 and 30% for all of its applicants.

Tracxn Labs-backed LoanZen has not tied up with any banking partners yet and focuses on disbursing its loans from the capital raised in its first round. The startup, which claims that it receives up to 20 applications daily, offers loans up to Rs 10 lakh at an interest rate, ranging between 18 to 24%.

“We aim to complete the credit risk evaluation in a matter of minutes and disburse loans within 3 days. Since sectors like kirana stores and budget hotels cannot avail of loans from traditional banks, there is a lot of room for several players to emerge in this space,” said Madhu Sudhan, cofounder of LoanZen. The startup uses an artificial intelligence-based system to carry out the credit risk evaluation and looks at parameters like bank, taxation and accounting data. LoanZen claims to have disseminated loans up to Rs 50 lakh in the month of March.

According to Gaurav Hinduja, the co-founder of Capital Float, SME lending is a very deep vertical in India, despite banks and NBFC’s lending approximately $150 billion to this sector.

The unmet need is still over $300 billion and at least 20% of this can be tapped by new age tech lenders.

“It’s definitely not a winner take all market and we will see several startups attacking different niches in the market. We are likely to see at least 10x growth in fintech alternate lenders. There will also be a growing number of interesting partnerships between institutions and new fin tech lenders,” added Hinduja. Abhishek Goyal, the founder of Tracxn, believes that despite several players entering the SME lending sector, few will survive the current funding climate.

Source: http://economictimes.indiatimes.com/articleshow/51818398.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst

Key changes in new Income Tax Return (ITR) forms

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The Finance Act, 2015 abolished the wealth-tax. Thus, taxpayers are no longer required to file returns of wealth tax from assessment year 2016-17 onwards. However, the Hon’ble Finance Minister in his budget speech had announced that information which was to be furnished in wealth tax return will now form part of Income Tax Returns (ITR).

Thus, in new ITR forms, namely, ITR-1, ITR-2, ITR-2A and ITR-4S the Government has imposed obligation on Individuals and HUFs having income exceeding Rs 50 lakhs to furnish information regarding assets and liabilities.

2.0 Changes made in new ITR forms:-

2.1 Declaration of value of assets and liabilities by Individuals/HUF earning above Rs 50 lakhs:-

[ITR 1, 2, 2A, 3, 4, 4S]

The new ITR forms introduce a new Schedule requiring individuals/HUFs to declare the value of assets and liabilities if their total income exceeds Rs. 50 lakhs. Assets include immovable assets and movable assets. Under the heading immovable assets, taxpayers have to disclose cost of land and building. Under movable assets cost of Jewellery, bullion, vehicles, Yachts, boats, aircraft and cash in hand need to be disclosed. Further, such taxpayers need to disclose all liabilities in relation to such assets.

Note: Individuals and HUFs with income exceeding 25 lakhs, filing ITR-3 and ITR-4 were already required to furnish information of their assets and liabilities. Now such threshold limit of 25 lakhs has been increased to 50 lakhs in new ITR-3 and ITR-4 for disclosure of details of assets and liabilities.

2.2          TCS credit for individual taxpayers:-

[ITR 1, 2, 2A]

Sub-section (1D) was inserted in Section 206 by the Finance Act, 2012 to reduce the practice of cash payments for purchase of bullion and Jewellery and for curbing the flow of unaccounted money in the trading system.

Section 206(1D) provides that the seller of bullion and Jewellery shall collect TCS at 1% of sale consideration from buyer if such sale consideration is received in cash and it exceeds:

i) 2 lakh, in case Bullion; and

ii) 5 lakh, in case of Jewellery.

However, in the absence of any row in the ITR Forms (ITR 1, 2 and 2A), individual taxpayers were unable to claim credit of such TCS. Therefore, new ITR Forms provide an option to claim TCS by the individual taxpayers.

2.3          Firms can file ITR-4S for presumptive income:-

[ITR-4S]

Under the existing provisions of Rule 12, firms were required to file ITR 5 even for presumptive income. The amended Rule 12 would now allow firms to file ITR 4S for presumptive income. Accordingly, a separate row is provided for in ITR 4S to claim deduction of interest and salary paid by the firms to the partners.

2.4        Additional deduction for contribution to NPS under Section 80CCD :-

[ITR 1, 2, 2A, 3, 4 and 4S]

A new sub-section (1B) was introduced in Section 80CCD by the Finance Act, 2015 to provide for an additional deduction of upto Rs. 50,000 for investment in National Pension Scheme. Accordingly, a new row is now introduced in the ITR Forms to claim benefits of such additional deduction.

2.5          Details of pass through income of business trust or investment fund:-

[ITR 2, 2A, 3, 4, 5, 6, 7]

As per provisions of Section 115UA and Section 115UB,pass through status is provided in respect ofincome [other than income from business or profession] of business trust/investment fund. Thus, income distributed by the business trust/investment fund is to be taxed in the hands of the unit holders.

The new ITR Forms have a new ‘Schedule PTI’ for reporting of pass through income of business trust/investment fund. Following details should be provided by such trust in ITR forms:

■  Name of business trust/investment fund

■  PAN

■  Head of income

■  Amount of income

■  TDS on such amount, if any.

2.6 Disclosure of details regarding partnership firm by a partner:-

[ITR 3, 4]

In ITR forms there is a separate ‘Schedule IF’ wherein partners are required to disclose the name of the partnership firms in which he is a partner. Now partners have to disclose whether such firm is liable to transfer pricing audit under Section 92E. Separate column has been inserted for such purpose in ‘Schedule IF’.

2.7 Share of income from firm/AOP/BOI:-

[ITR 3, 4, 5, 6]

Share of income from partnership firm, AOP and BOI is exempt from tax in hands of recipient. However, such exempt income had to be disclosed in old ITR forms under ‘Schedule EI’. Now, disclosure of such exempt income has been done away with in new ITR forms.

2.8 Deduction of additional investment allowance:-

[ITR 4, 5, 6]

Section 32AD was inserted by the Finance Act, 2015 to provide for an additional investment allowance to an undertaking set-up in the notified backward areas in the States of Andhra Pradesh or Telangana. Suitable safeguards have been provided in the provision for restricting the transfer of the plant or machinery for a period of 5 years. On transfer of such asset within five years, the amount of deduction already allowed shall be deemed as income from business or profession (i.e., deemed income under Section 32AD) in the year of transfer.

A separate row has been inserted in new ITR forms to claim such deduction under Section 32AD. Further, a separate row is provided to offer the deemed income to tax under Section 32AD.

2.9 Effect of Income Computation and Disclosure Standards (‘ICDS’):-

[ITR 4, 5, 6]

New ‘Schedule ICDS’ has been inserted in ITR forms wherein effect of Income Computation and Disclosure Standards (‘ICDS’) on profit needs to be disclosed.

2.10       Percentage of commercial receipts by a trust:-

[ITR 7]

The Finance Act, 2015 has substituted the proviso to Section 2(15) to provide that the advancement of any other object of general public utility shall not be a charitable purpose, if it involves the carrying on of any activity in the nature of trade, commerce or business, unless:

i) such activity is undertaken in the course of actual carrying out of such advancement of any other object of general public utility; and

ii) the aggregate receipts from such activity or activities during the previous year, do not exceed 20% of the total receipts, of the trust or institution undertaking such activity or activities, of that previous year.

In other words, advancement of any other object of charitable purpose shall not be deemed as charitable if receipts from any commercial activity exceed 20% of total receipts. Accordingly, a new row is inserted in ITR 7 to disclose percentage of commercial receipts vis-à-vis total receipts in order to ensure that such condition (as given hereinabove) is not violated.

2.11       Application of income by a trust:-

[ITR 7]

Income of charitable or religious trust is exempt if 85% of its income is applied for charitable or religious purposes in India. If income applied for charitable or religious purposes during the previous year falls short of 85% because such income has not been received during the year or due to any other reason, an option is given to assessee to apply such income in future years in prescribed manner. Assessee has to choose such an option by filing Form 9A to the Assessing Officer before due date of filing return of income under Section 139(1).

Now a separate row is provided in new ITR 7 requiring trust to confirm if it has filed Form 9A to exercise such an option and the date of filing of such form.

2.12       Details to be given by Universities, hospitals, educational institutions:-

[ITR 7]

Exemption under sub-clause (iiiab) and (iiiac) of Section 10(23C) is available to universities or educational institutions, hospitals or other institutions which are wholly or substantially financed by the Government, subject to certain prescribed conditions. The Finance Act, 2015 has amended the provisions of Section 139 to provide that such entities covered under clauses (iiiab) and (iiiac) of Section 10(23C) shall be mandatorily required to file their returns of income.

Now such universities, hospitals, educational institutions, etc., have to disclose their name and annual receipts in new ITR 7. Further, they are also required to disclose the amount eligible for exemption in ITR 7.

2.13       Minimum Alternate Tax (MAT) disclosure:-

[ITR-6, 7]

The Finance Act, 2015 had excluded following incomes for computing MAT liability:

i) Share of a member in the income of the AOP/BOI, on which no income-tax was payable.

ii) Passive income (like capital gains, interest, royalty, FTS) accruing or arising to foreign company if income-tax payable thereon was less than 18.5%.

iii)  Amount representing:

–          Notional gain on transfer of a capital asset, being share of SPV to a business trust in exchange of units allotted by that trust referred to in clause (xvii) of Section 47; or

–          Notional gain resulting from change in carrying amount of said units; or

–          Gain on transfer of units referred to in clause (xvii) of section 47.

iv) Loss on transfer of units referred to in Section 47(xvii) (subject to conditions)

 

Consequently, the Finance Act, 2015 had provided for addition of related expenditure on aforesaid income while computing MAT liability.

Separate row have now been inserted in ITR forms to incorporate such changes.

 

2.14       Disclosure of Audit information:-

[ITR 5, 6]

In new ITR forms there is a separate row for disclosure of following details if taxpayer is liable for audit under any Act [other than the Income Tax Act]:

1)         Act and Section under which taxpayer is liable for audit

2)         Date of furnishing of Audit Report.

2.15 Deduction of sum paid for purchase of sugarcane:-

[ITR-5]

The Finance Act, 2015 had inserted Section 36(1)(xvii) to provide that co-operative society, engaged in the business of manufacturing of sugar, could claim deduction of expenditure on purchase of sugarcane to the extent of price approved or fixed by the Government. Expenditure in excess of such fixed price was to be disallowed.

 

New ITR-5 has inserted a separate row for disclosure of sum which is disallowable under Section 36(1)(xvii).

2.16 Deduction under section 80JJAA:-

[ITR 4, 5]

Old provisions of section 80JJAA, inter alia, provided for deduction to an Indian company, deriving profits from manufacture of goods in a factory. The quantum of deduction allowed was equal to 30% of additional wages paid to the new regular workmen employed by the assessee in such factory, in the previous year, for three assessment years including the assessment year relevant to the previous year in which such employment was provided.

With a view to encourage generation of employment, the Finance Act, 2015 had amended Section 80JJAA so as to extend the benefit of such provision to all assessees having manufacturing units rather than restricting it to corporate assessees only.

New ITR-4 and ITR-5 forms now contain a separate row for such taxpayers (other than corporate taxpayers) to claim benefit of such deduction under Section 80JJA

I-T dept launches tax calculator; e-filing of few ITRs begins

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The calculator works once a filer correctly feeds his basic details and information, as notified for the current assessment year by the government.

E-filing of income tax returns for the assessment year 2016-17 was launched today for a select category of entities and individuals even as the IT department provided an online calculator for filers to do an easy check and obtain their annual tax liability.

“Two Income Tax Returns have been activated over the official e-filing portal of the department today.

The two are ITR 1 (SAHAJ) meant for individuals having income from salary and interest and ITR 4S (Sugam) meant for individuals, HUF, partnership firms having income from presumptive business,” a senior tax department officer said.

The other ITRs will be hosted on the same portal soon, the officer said.

The ‘tax calculator’ is an online computer-based programme hosted on the website of the tax department and is meant to help taxpayers or filers assess their tax liability.

The calculator works once a filer correctly feeds his basic details and information, as notified for the current assessment year by the government.

Last year, the e-filing commenced on July 1 as there was delay in finalisation of the ITR forms because of the controversy generated over a 14-page document requiring assesses to disclose bank account and foreign travel details.

Later the form was simplified and the number of pages was reduced to three.

This year, the Central Board of Direct Taxes notified the new forms on March 30 and ITRs can be filed till the stipulated deadline of July 31.

At the time of filing the form, the taxpayer has to fill in his PAN, personal information and information on taxes paid and TDS will be auto-filled in the form.

Officials said the calculator has been updated and calibrated by the department as per the new announcements made in respect of tax rates in the latest Budget.

The facility can be used by any taxpayer whether individual, corporate or any other entity, to compute their tax liability.

However, there is a word of caution from the tax department that filers should not solely rely on it as complicated cases of ITR have different requirements which may not be addressed by the ‘calculator’.

“The calculator is only to enable public to have a quick and an easy access to basic tax calculation and does not purport to give correct tax calculation in all circumstances.

“It is advised that for filing of returns the exact calculation may be made as per the provisions contained in the relevant Acts, Rules etc,” the tax department said in a disclaimer.

The official said the calculator has been hosted on the website of the department, for the ease of all who either do e-filing or manual filing of ITR.

The calculator has been enabled to compute the total tax liability of an individual or any other category of taxpayer under various heads like income from house property, capital gains, profits and gains of business or profession and agricultural income, among others.

A total of nine such ITRs have been notified which include the Sahaj (ITR-1), ITR-2, ITR-2A, ITR-3, Sugam (ITR-4S), ITR-4, ITR-5, ITR-6, ITR-7 and an acknowledgement form called the ITR-V.

People with an income of more than Rs 50 lakh per annum and who own luxury items like yacht, aircraft or valuable jewellery will now have to disclose these expensive assets with the IT department in the new ITRs.

ITR 1-SAHAJ, 2 and 2A can be used by individual or Hindu Undivided Families whose income does not include income from business.

ITR 4S – SUGAM can be used by an individual or HUF whose income includes business income assessable on presumptive basis.

It can also be filed by a firm, other than a limited liability partnership firm.

CBDT processes 6.53L online rectification requests in ITR

by | posted in: Corporate Updates, Income Tax,e-Filing- Individuals, Firms, Companies | 0

CBDTThe tax department has processed over 6.53 lakh online rectification applications in 2015-16 fiscal and asked the assesses to make use of the e-filing portal for correcting mistakes in Income tax returns.

The Central Board of Direct Taxes (CBDT) in a statement said the e-filing portal of the I-T department provides the utility for online filing and tracking of rectification requests.
CPC has already processed 6,53,763 online rectification requests in 2015-16 till February 29, 2016.
Section 154 of the Income-tax Act provides the taxpayer with an option to seek rectification of mistakes in record.
CBDT said a detailed user manual for filing online rectification is available on the e-filing portal, on which the taxpayer can also monitor the status of disposal of rectification request.
It said in case of any mistake in data entry of tax payment or TDS details, taxpayer can select the “Rectification Request Type->Taxpayer is correcting data for Tax Credit mismatch only” and use the option of pre-filling the correct details.
In case of data entry mistake in any other Schedule or omission of any details, the taxpayer can select the option “Taxpayer is correcting Data in Rectification” and the reason for seeking rectification.
In any other case taxpayer can select the option “No further Data Correction Required, Reprocess the case” where the mistake in processing may have occurred due to non-reporting of TDS by deductor etc, CBDT said.
“CBDT is committed to ensuring accuracy in processing of returns and determination of refunds and seeks the active cooperation of taxpayers in ensuring correctness of data while submitting the return or rectification request,” the statement added.

Source: http://policypulse.com/news/india/story/1116.html

Private sector lender Federal Bank to support startups

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Jumping on to the startup bandwagon, Kerala based private sector lender Federal BankBSE -1.38 % is opening incubation centres in Bangalore and Ernakulam exclusively for startups. These would be specialised lounges within Federal Bank branches meant for funding advisory, regulatory support and if required even for direct investment.

“We have a dedicated startup fund worth Rs 25 crore which we would like to use to fund or lend to promising startups. These lounges, named Launchpad, with fast internet connections, support staff from the financial world and advisory mechanisms would be the perfect breeding ground for future entrepreneurs,” said Shyam Srinivasan, managing director, Federal bank.

The lounge would be manned by bank officers who would be capable of dealing with the financial requirements of the startups as well as local specialists who would be able to advise on regulatory issues that entrepreneurs need to handle.

“We are talking to 3 or 4 startups daily. The challenge for a bank is to move away from a conservative credit mind set to a more entrepreneurial mind set and to accept the fact that out of 40 or 50 investments only one might take off. So even we are in the process of understanding how to engage with startups better,” he said.

The bank follows the footsteps of HDFC Bank and Bank of Baroda to integrate their platform with mobile payments application Chillr. The addition that Federal Bank brings to the Chillr app is that they would allow even non Federal Bank users to instantly open a Federal Bank account through a selfie and Aadhar identification number and allow them to receive payments through Chillr.

“This is just another offer in the suite of offerings for the customer. We are in the major discovery process slowly there would be convergence in this field,” said Srinivasan.