Latest Blogs from SBS and Company LLP

    Introductory Remarks:
    A high level inter-ministerial committee was constituted in 2017 under the Chairmanship of Secretary Department of Economic Affairs, to study the issues related to virtual currencies. The mandate of the Committee included examination of policy and legal framework for the regulation of virtual currencies. The subject of virtual currencies is assuming importance day by day after every country in the world drafting regulations either to allow or prohibit usage of same. Further, the current regulatory and legal framework does not squarely cover the issues presented by the usage of virtual currencies and technology involved therein.

    The absence or inadequate regulatory and legal framework over the usage of virtual currencies presents a challenge to the customers, economy and society. The recent ponzi scheme unearthed by Pune Police where a person claiming himself to be a Bitcoin1 entrepreneur has duped 8000 people involving INR 2000 Crore scam2. Also, various scams in other countries and the value of Bitcoin falling rapidly on the Coin Stock Exchanges and such value is not being backed by any concrete assets, the virtual currencies offer various challenges. The Ministry of Finance in India has issued a press release dated 29th Dec 173 stating that virtual currencies do not have any intrinsic value and are not backed by any kind of assets and cautioned that such currencies are not backed by Government and thereby are not legal tender.

    Further, there is also classification issue in the virtual currencies, which also offers a significant challenge in designing the regulatory and legal framework around the same. Many countries generally classify virtual currencies into payment, utility and security tokens. Also, in certain countries another category of hybrid tokens that share characteristics of multiple categories also exits.

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    Dear All,

    Today marks an important milestone in the journey of our organisation. From today, we become eligible to start officially using the expression ‘decade’, to convey the age of our organisation. I bow down to each one who has supported all through the past years to make our organisation as it stands today. I wish and pray that each one will continue their best efforts and support in the  years to come.

    When I sit back and recollect, it’s natural that I was forced to see how last decade flew by. When I started the firm, I would not say that, I had a clear vision, clear path and clear destination. What I had immensely is the unstoppable spirit that I must live my life big size. Never there was a time, I felt that this life is worthless to pursuit. I had from the day one, a dream of creating an organisation which should continue beyond me. When I used to talk about such dream to people in the profession, all I could understand is that I am treading a path, which is less travelled, and challenges will be most  obvious. Despite the theoretical challenges and various setbacks, which I have picked up from various people, I decided to embark my journey.  

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    In this edition, we bring you to quite a few interesting articles.
    The article on ‘Affordable Housing – Income Tax & GST Perspective’ deals with tax incentives under both the taxation laws for a business which is engaged in making the goal of this government true. We have also commented on certain issues from both the taxation laws with respect to affordable housing.

    We also have an article on ‘Gifts, Discounts, Credit & Impact thereof’, wherein one of the issues in GST with respect to the gifts, discounts and impact of credit is detailed. This is based on the recent rulings of AAR and Circulars issued by CBIC on the said subject.

    The next article is on ‘MSME vis-à-vis Internal Audit’, which brings the importance of internal audit for MSMEs and the key challenges faced by Auditor in auditing such auditees.

    The final one is on the new section introduced by Finance (No.2) Bill, 2019 in direct taxation, which deals with deduction of tax by individuals or HUFs when using the services of contractor or professionals. We have also contributed certain FAQs for the benefit of Clients.

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    Key Topis:

    AUDIT

    • STANDARDS ON QUALITY CONTROLS (SQC’S)

    DIRECT TAX

    • SECTION 112A OF INCOME TAX ACT, 1961

    FEMA

    • FEM (GURANTEES) REGULATIONS, 2000

    Updates:

    COMPANIES ACT, 2013

    • RULES,CIRCULARS,NOTIFICATIONS AND ORDERS ISSUED IN THE MONTH OF JUNE-2019

    Contents

    Amendments to Income Tax Act, 1961.

    Section 2(19AA) - Demerger

    Section 9(viii) – Income deemed to accrue or arise in India vis-à-vis Section 56(2)(x)

    Section 9A – Extended time to achieve monthly average corpus by specified funds – FIIs.

    Section 10 – Certain Incomes not to be included in Total Income – Certain Interest Payable to NRs.

    Section 12AA – Amendments in Procedure for Registration of Trust or Institution.

    Section 40 – Payer not be treated as Assesse in Default in case of payments to NRs.

    Section 43B – Deduction of Interest on payment basis to loans extended by specified NBFCs.

    Section 43D – Payment of Tax on Interest on receipt basis by specified NBFCs.

    Section 47 – Securities dealt by Category III AIFs – Not to be treated as Transfer

    Section 50CA – Relaxation for Notified Persons from provisions of FVC – Other than Quoted Share.

    Section 54GB – Extension for Investment in Eligible Start-Up on transfer of Residential Property.

    Section 56(2)(viib) – Extension of Non-Applicability to Category II AIFs & Other notified Companies.

    Section 56(2)(x) – Class of Persons to which such section is not applicable.

    Section 79 – Relaxation for Eligible Start-ups to carry forward and set off loss – Shareholding.

    Section 80C – Contribution to Pension Scheme by Employee of Central Government

    Section 80CCD – Increase of Deduction – Contribution to Pension Scheme – By Central Government

    Section 80EEA – Deduction of Interest – Rs 1.5 Lakhs – New Affordable Residential Apartment

    Section 80EEB – Deduction of Interest – Rs 1.5 lakhs – Purchase of Electric Vehicle.

    Section 80IBA – Affordable Residential Housing – Aligned with GST laws – Hyderabad as Metro.

    Section 80LA- Deduction for Unit in IFSC – Any 10 Years out of 15 Years – 100%..

    Section 92CE – Clarification in Secondary Adjustments & Additional Tax @ 18% - Option of Assessee.

    Section 115O – Relaxation from Payment of DDT of Unit in IFSC out of Accumulated Income

    Section 115QA – BBT for Listed Companies too

    Section 115R – Exemption for unit in IFSC from payment of tax on distributed income

    Section 139 – Certain Transactions – Mandatory Filing of Return

    Section 139A – PAN or Aadhar, anything is fine

    Section 194IA – Consideration for Immovable Property for 1% deduction of tax

    Section 194M – Personal Use – 5% tax deduction at source – If exceeds Rs 50 lakhs

    Section 194N - Cash Withdrawals – 2% tax deduction at source – If exceeds Rs 1 Crore

    Section 269SU – Provision for prescribed mode for accepting payment in electronic modes

    Rates of Taxes – Surcharge & Domestic Companies

    Amendments to Prohibition of Benami Property Transactions Act, 1988

    Section 23 – Insertion of Explanation – No Investigation by IO after issuance of SCN.. 

    Section 24 – SCN and Attachment of Property in Benami Transaction – IO.. 

    Section 26 – Adjudication of Benami Property – Adjudicating Authority

    Section 54A – Penalty for non-compliance with summons and furnishing of information

    Section 55 – Prosecution to be sanctioned by Competent Authority – Not Board anymore

    Amendment to Reserve Bank of India Act, 1934

    Section 45IA – Enhancement of NOF – NBFC

    Section 45ID – Power to Remove Directors from Office of NBFC

    Section 45IE – Power to Supersession of Board of Directors of NBFC

    Section 45MAA – Action against Auditors – Debar from Audit of Banks – 3 Years at a time

    Section 45MBA – Resolution of NBFC

    Section 45NAA – Power in respect of Group Companies

    Amendments to Central Goods & Services Tax Laws

    Section 10 –Composition Scheme – Supplier of Services

    Section 44 – Inter-se transfer in Electronic Cash Ledger 

    Section 50 – Interest to be paid on net basis

    Section 54 – Refund – Power to CG to refund State Tax too

    Section 101A & Others – National Appellate Authority for Advance Rulings

    Amendments to Customs Act

    Section 110 – Provisional Attachment of Bank Accounts

    Section 140 – Power of Arrest – Offences Outside India

    Amendments to Service Tax Laws

    Retrospective Exemption – Liquor License Fee

    Retrospective – Exemption – Premium/Salami – Long Term Lease

    Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019

    Section 121 – Indirect Tax Enactments – Applicability of Scheme.

    Section 123 – Relief available under LDR

    Section 124 – Persons Ineligible for making declaration

    Modus Operandi 

    Section 128 – Discharge Certificate – Conclusive Proof 

    Section 129 – Restrictions of Scheme

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