GSTPAM News Bulletin April 2022

CIRCULAR FOR RENEWAL OF MEMBERSHIP/SUBSCRIPTION CHARGES FOR THE F.Y. 2022-23

Dear Members,

RENEWAL OF MEMBERSHIP FOR F.Y. 2022-23

The Membership Fees for the year 2022-23 are due for renewal on 01.04.2022. We appreciate your Continuing support and participation in the activities of our Association.

The timely Renewal of Membership will enable the members to continuously receive the updates on various activities of GSTPAM along with the GSTReview, News Bulletin, Circulars, Messages, Webinars and online access to the website
www.gstpam.org. The Life Members only need to renew the subscription charges for the GST Review. The members can also avail the benefit of discount by paying advance for subsequent two years membership fees /subscriptioncharges.

The Membership Renewal Fees received after 30th April, 2022 will be subject to approval of the Managing Committee. If the Renewal fees for a particular year are not paid, then the member is liable to pay Admission Fees again for Renewal in the subsequent year.

Delayed Renewal Members will be provided Pre Renewal GST Review subject to availability upon payment of such additional courier charges.

The details of Membership/Subscription Fees are given below for your ready reference:

Type of Membership	Membership Fees incl. GST	Admission Fees Incl. GST	Subscription Charges for GST Review	Total
New Membership Application
Donor Member	24,780.00	–	600.00	25,380.00
Patron Member	17,700.00	–	600.00	18,300.00
Life Member	11,800.00	944.00	600.00	13,344.00
Life Member (Conversion from Ordinary)	11,800.00	590.00	600.00	12,990.00
Ordinary Local Member	1,770.00	590.00	–	2,360.00
Ordinary Outstation Member	1,475.00	590.00	–	2,065.00
New Membership Application (Firm/LLP)
Ordinary Local Member	1,770.00	944.00	0	2,714.00
Ordinary Outstation Member	1,475.00	944.00	0	2,419.00
Patron Member	17,700.00	0	600.00	18,300.00
Donor Member	24,780.00	0	600.00	25,380.00
Advance Membership/ Subscription charges for subsequent two years 2023-24& 2024-25 (Non-Refundable)
Ordinary Local Member	3,186.00	–	–	3,186.00
Ordinary Outstation Member	2,655.00	–	–	2,655.00
Life Member (Individual/Firm/LLP)	0	–	1,200.00	1,200.00
Patron Member	0	–	1,200.00	1,200.00
Donor Member	0	–	1,200.00	1,200.00
Subscription for GST Review for F.Y. 2022-23 by Non-Members
Subscription fees for GSTR	–	–	1,000.00	1,000.00
Advance Membership / Subscription charges for subsequent two years 2023-24& 2024-25 (Non-Refundable)
Subscription Fees -GSTR	0	–	2,000.00	2,000.00

Modes of Payment:-

Cheque	A/c Payee Cheque drawn in favor of “The Goods & Services Tax Practitioners’ Association of Maharashtra” payable at Mumbai.
NEFT Details	The Goods & Services Tax Practitioners’ Association of Maharashtra Bank of India, Mazgaon Branch Current Account No. 007020100001816, IFSC Code – BKID0000070. Online generated transaction Acknowledgment should be sent by email on [email protected] along with membership and payment details Members are requested to send their physical form to the association for Approval, Issuance and Office record.
Cash	Renewal form along with requisite amount will be accepted between 10.30 a.m. and 5.30 p.m. on all working days except Saturday at our Office at Mazgaon Library – Mazgoan: 1st Floor, 104, GST Bhavan, Mazgaon, Mumbai – 400 010 Or Bandra Library – GST Bhavan, Ground Floor, A Wing, Bandra Kurla Complex, Bandra (East), Mumbai – 400 051. Or Mazgaon Tower-8 & 9, Mazgaon Tower, 21, Mhatar Pakhadi Road, Mazgaon, Mumbai – 400 010.
Identity (New Members)	New Members should provide the following as Identity Proof : PAN, Aadhar Card, Constitution Document. Address Proof(any one) : Electricity Bill / Passport/ Aadhar Card / Driving License/ Voter id/ Ration Card along with Membership Form
Identity Card (For Renewals)	Ordinary Local/Outstation Members should provide Two Photographs along with the Renewal Form for issue of I-cards.
Online Payment Link	Members can make online payment on our website www.gstpam.org.Members are requested to download Members Renewal form from website.Update the latest details in the form, scan it and mail at [email protected] Payment Link : https://www.gstpam.org/online/renew-membership.php If you are login first time? Click here for create your password

We value your continuation of the membership and look forward to your renewal to this effect.

Mahesh Madkholkar
Parth Badheka
Hon. Jt. Secretary

Dated:-31.01.2022

GSTPAM Student’s Committee is pleased to announce its Exclusive GST Beginners Course on GST

No	Date	Time	Topics
1	11/04/2022	4.00 PM to 6.00 PM	Inaugural Session & Overview of GST (BASIC CONCEPTS)
2	11/04/2022	6.15 PM to 7.45 PM	Important Definitions under GST
3	13/04/2022	4.30 PM to 6.00 PM	Registration under GST Act + Composition Levy
4	13/04/2022	6.15 PM to 7.45 PM	Levy and Scope of Supply (including Exemptions under GST)
5	15/04/2022	4.30 PM to 6.00 PM	Time of Supply under GST
6	15/04/2022	6.15 PM to 7.45 PM	Value of Supply under GST
7	18/04/2022	4.30 PM to 6.00 PM	Place of Supply of Goods under GST
8	18/04/2022	6.15 PM to 7.45 PM	Place of Supply of Services under GST
9	20/04/2022	4.30 PM to 6.00 PM	Composite and Mixed Supply
10	20/04/2022	6.15 PM to 7.45 PM	TDS / TCS & E-COMMERCE
11	22/04/2022	4.30 PM to 6.00 PM	Reverse Charge MECHANISM under GST
12	22/04/2022	6.15 PM to 7.45 PM	ITC Refund under GST
13	25/04/2022	4.30 PM to 6.00 PM	Type of Invoices, Credit / Debit Notes, and Maintenance of Accounts under GST
14	25/04/2022	6.15 PM to 7.45 PM	E-Way Bill
15	27/04/2022	4.30 PM to 6.00 PM	Imports under GST
16	27/04/2022	6.15 PM to 7.45 PM	Exports & Supply to SEZ under GST
17	29/04/2022	4.30 PM to 6.00 PM	Returns and Payment of Taxes under GST (New & Old Return)
18	29/04/2022	6.15 PM to 7.45 PM	Assessments & Penalties/ Demands & Recovery under GST
19	04/05/2022	4.30 PM to 6.00 PM	Finalisation of Accounts under GST
20	04/05/2022	6.15 PM to 7.45 PM	Annual return/Audit under GST
21	06/05/2022	4.30 PM to 6.00 PM	Recent Amendments under GST
22	06/05/2022	6.15 PM to 7.45 PM	Confiscation and Arrest provisions
23	09/05/2022	4.30 PM to 6.00 PM	Appeals and AARs
24	09/05/2022	6.15 PM to 7.45 PM	Overview of GST Website
25	14/05/2022	2.00 PM to 5.00 PM	Moot Court
26	14/05/2022	5.00 PM to 5.15 PM	Closing Ceremony Certificate Distribution

Registration Fees INR 1000/- incl. GST

Link for Registration and payment: https://www.gstpam.org/event/gst-beginners-course-on-gst/

GST, MVAT & ALLIED LAW UPDATES

Compiled by
Adv. Pravin Shinde

Central Tax Notifications
Notification No.	Date of Issue	Subject
01/2022	24-02-2022	Seeks to implement e-invoicing for the taxpayers having aggregate turnover exceeding Rs. 20 Cr from 01st April 2022.
02/2022	11-03-2022	Appointment of Common Adjudicating authority for adjudicating the show cause notices issued by DGGI under GST.
03/2022	31-03-2022	Seeks to amend notification no. 10/2019-Central Tax to implement special composition scheme for Brick Kilns, as recommended by 45 GSTC
04/2022	31-03-2022	Seeks to amend notification no. 14/2019-Central Tax to implement special composition scheme for Brick Kilns, as recommended by 45 GSTC

Central Tax (Rate) Notifications
Notification No.	Date of Issue	Subject
01/2022-Central Tax (Rate)	31-03-2022	Seeks to amend notification No. 1/2017-Central Tax (Rate)
02/2022-Central Tax (Rate)	31-03-2022	Seeks to provide for a concessional rate on intra state supply of bricks conditional to not availing the ITC, as recommended by 45 GSTC

Integrated Tax (Rate) Notifications
Notification No.	Date of Issue	Subject
01/2022- Integrated Tax (Rate)	31-03-2022	Seeks to amend notification No. 1/2017-Integrated Tax (Rate)
02/2022- Integrated Tax (Rate)	31-03-2022	Seeks to provide for a concessional rate on inter state supply of bricks conditional to not availing the ITC, as recommended by 45 GSTC

Union Territory Tax Notifications
Notification No.	Date of Issue	Subject
01/2022-Union Territory Tax	31-03-2022	Seeks to amend notification no. 02/2019-Union Territory Tax to implement special composition scheme for Brick Kilns, as recommended by 45 GST Seeks to amend notification no. 02/2019-Union Territory Tax to implement special composition scheme for Brick Kilns, as recommended by 45 GSTC
01/2022-Union Territory Tax	31-03-2022	Seeks to amend notification no. 02/2017-Union Territory Tax to implement special composition scheme for Brick Kilns, as recommended by 45 GSTC

Union Territory Tax (Rate) Notifications
Notification No.	Date of Issue	Subject
01/2022-Union Territory Tax	31-03-2022	Seeks to amend notification No. 1/2017-Union Territory Tax (Rate)
01/2022-Union Territory Tax	31-03-2022	Seeks to provide for a concessional rate on intra state supply of bricks conditional to not availing the ITC, as recommended by 45 GSTC

CGST Circular
Circular No.	Date of Issue	Subject
169/01/2022- GST	12-03-2022	Amendment to Circular No. 31/05/2018-GST, dated 9th February, 2018 on ‘Proper officer under sections 73 and 74 of the Central Goods and Services Tax Act, 2017 and under the Integrated Goods and Services Tax Act, 2017

Maharashtra Goods and Services Tax Act, 2017 (MGST) Notification
Notification No.	Date of Issue	Subject
D.C.(A&R)-2/ GST/ PWR / Sections/2017-18 /ADM -8-EO No. 26 Dt. 22/02/2022	22-02-2022	Delegation of power to arrest u/s 69 of MGST Act 2017-JCST BCP Maharashtra State, Mumbai
GST.1022/C.R.15/ Taxation-l.— EO No.78 Dt 08.03.2022	08-03-2022	Seeks to implement e-invoicing for the taxpayers having aggregate turnover exceeding Rs 20 Cr from 01st April 2022.

MVAT Circular
Circular No.	Date of Issue	Subject
DC(A&R)3/VAT/ MMB-2022/2/ ADM-8.-dated 30th March 2022.	30-03-2022	Instruction under section 19(1) of the setellement Act

MVAT Notification
Notification No.	Date of Issue	Subject
L.A. Bill No. IX of 2022 Dt. 16th March 2022. (Marathi)	16-03-2022	The Maharashtra Settlement of Arrears of Tax, Interest, Penalty or Late Fee Act,2022.
L.A. Bill No. IX of 2022 Dt. 16th March 2022. (English)	16-03-2022	The Maharashtra Settlement of Arrears of Tax, Interest, Penalty or Late Fee Act,2022.
No. VAT -1522/ CR-18/Taxation-1 Dated. 25th March 2022	25-03-2022	Change in rate of VAT on Natural Gas
MAHARASHTRA ACT No. XXIX OF 2022. (English)	28-03-2022	An Act to provide for settlement of arrears of tax, interest, penalty or late fee which were levied, payable or imposed, respectively under various Acts administered by the Goods and Services Tax Department and for the matters connected therewith or incidental thereto.
MAHARASHTRA ACT No. XXIX OF 2022 (Marathi)	28-03-2022	An Act to provide for settlement of arrears of tax, interest, penalty or late fee which were levied, payable or imposed, respectively under various Acts administered by the Goods and Services Tax Department and for the matters connected therewith or incidental thereto.
DC(A&R)3/VAT/ MMB-2022/2/ ADM-8.-dated 30th March 2022.	30-03-2022	Order under section 19(1) of the settlement Act for specifying the forms and manner of the submission of forms.
DC(A&R)3/VAT/ MMB-2022/2/ ADM-8.-dated 30th March 2022.	30-03-2022	Instructions under section 19(1) of the settlement Act.
DC (A & R)3/VAT/ MMB-2022/2/ ADM-8. dated 30th March 2022.	30-03-2022	Notification to designate the authorities and power delegation under settlement act.

RECENT ADVANCE RULINGS UNDER GST

Brief Analysis by
CA Aditya Surte

Whether rent-free accommodation provided by the partner to the partnership firm is a supply liable to GST?

Applicant is an individual and is the owner of several properties in Chennai. He is also a partner in a partnership firm along with his wife with a PSR of 2:1. The firm is conducting its business from the properties owned by the Applicant, for which no rent was being paid by the firm to the partner till 2016, and a nominal rent is being paid to the owner since the onset of #GST owing to the lack of clarity as to the applicability of GST on rent-free usage of property.

The Applicant sought clarity on the following issues:
1. Whether the activity of renting of property for use by the partnership firm is in the course or furtherance of business of the individual partner (Applicant)?
2. Whether GST is liable to be paid when a partner rents his property to his partnership firm on a rent-free basis?
3. What is the value to be adopted in such situation?
Regarding the first issue, the Authority observed that the owner-partner holds 2/3rd share of profit or loss of the partnership firm. The properties, even if rented free to the firm, would ease the burden of rent to be paid by the firm and result in increased profit. This rent-free accommodation if so provided by the applicant indirectly accrues as profit for the firm which is enjoyed by the Applicant as partner. So, the economic benefit accrues to him and hence this supply is in the course of and furtherance of business. Furtherance of business is established by the direct and continuous accrual of economic benefit to the Applicant out of renting these premises.

Regarding the coverage of the transaction under the scope of supply and applicability of GST, the Authority observed that for the purposes of GST, individual partner and partnership firm are separate persons and are “related persons”. As per Sr. No. (2) of Schedule I to the CGST Act, the supply of service between related persons, i.e., the Applicant and the partnership firm, when made in the course or furtherance of business, is a taxable supply even when rendered without consideration.

Further, the value to be adopted for the purposes of levying GST shall be computed as per sec. 15(5) of CGST Act r/w rule 28 of CGST Rules.

(Tamil Nadu AAR Order No. 03/AAR OF 2022 dated 31/01/2022 in the case of Shanmuga Durai)
Whether taxpayer engaged in manufacture and counter sale of sweets and namkeen is eligible to pay GST @ 1% under composition as a manufacturer?

Applicant is running a sweet stall and is engaged in the manufacture of sweets and counter sale thereof on retail basis, without any facility of restaurant or hotel. He is registered under GST as a composition taxpayer and paying tax @ 1% on total turnover as a manufacturer. He sought advance ruling on the issue of applicable rate of GST under composition scheme for manufacture of sweet and namkeen and selling the goods over the counter not having any facility of restaurant or hotel.

The Authority observed that since the Applicant is into manufacture of sweets, he can opt to pay GST @ 1% of the turnover subject to conditions mentioned in Notification No. 8/2017–Central Tax dated 27/06/2017 as amended.

(Karnataka AAR Order No. KAR/ADRG/79/2021 dated 31/12/2021 in the case of Chikkaveeranna Sweet Stall)
Whether activity of body building on the chassis of different models of Tippers, Tankers, Trucks and Trailers provided by principal on the basis of returnable delivery challans can be classified as job work?

Appellant is engaged in the business of body building and mounting of body on the chassis of different models of Tippers, Tankers, Trucks and Trailers. They receive chassis of these items from TATA Motors and other customers on the basis of returnable challan. Appellant had sought advance ruling on the issue of whether the activity of body building on chassis provided by principal would amount to manufacturing services attracting 18% GST and whether CBIC clarification vide Para No. 12.3 of Circular No. 52/26/2018-GST dated 09/08/2018 clarifying 18% rate of GST in respect of building of body of buses would also apply in the case of applicant. UPAAR vide its order dated 30/06/2021 ruled that the said activity would not amount to manufacturing services attracting 18% GST and clarification of CBIC vide the abovementioned Circular would also not apply in the Appellant’s case. Aggrieved by the order of the UPAAR, the appellant filed appeal before the UPAAAR.

In appeal, the UPAAAR distinguished the order of UPAAR on two counts. On the first count, the AAAR observed that the job worker can use certain inputs required for fabrication work and merely because the Appellant is procuring the inputs / material required for fabrication of the body on its own account, the same will not amount to manufacture. Secondly, while distinguishing the AAR’s observation that the ownership of the chassis was transferred by the principal to the applicant, AAAR observed that the chassis delivered to the Appellant remains in their temporary possession only for certain time to carry out the process of job work as per direction of the principal. The Appellant receives the chassis only as a job worker and on free of cost basis under a delivery challan. In view of this the AAAR concluded that the ownership of the chassis remains with the principal.

Regarding the applicable rate of GST, the UPAAAR observed that the entry relating to ‘services by way of job work on relation to bus body building’ of Notification No. 11/2017-CTR is applicable in the Appellant’s case and that Circular No. 52/26/2018-GST dated 09/08/2018 is squarely applicable in the Appellant’s case.

Held that the body building and mounting of body on the chassis of different models of Tippers, Tankers, Trucks and Trailers, on the chassis to be supplied by the Principal, on delivery challans, by collecting job work charges for such fabrication work is taxable @18%, in accordance with Circular No. 52/26/2018-GST dated 09/08/2018, subject to fulfilment of all the conditions prescribed in the sections 141 and 143 of the CGST Act, 2017 read with relevant Rules/ Notifications.

(Uttar Pradesh AAAR Order No. 19/AAAR/25/11/2021 dated 25/11/2021 in the case of Adithya Automotive Applications Pvt. Ltd.)

INCOME TAX UPDATES

By CA. Ajay Talreja

TAXATION OF CRYPTOCURRENCY

Cryptocurrency and Income Tax Clarification on the taxation of cryptocurrency in India was highly waited for the crypto holders. With the introduction of Budget 2022, the government has announced taxation norms on the same. Key pointers regarding income tax implications on cryptocurrencies in India are as follows –

Cryptocurrency – Meaning as per Income Tax provisions a form of virtual digital asset not being an Indian currency or foreign currency as per the provisions of Foreign Exchange Management Act, 1999 functions as a store of value, unit of account can be transferred, stored or traded electronically 2. Classification of Virtual Digital Asset As per the Finance Bill, 2022, cryptocurrencies are classified as a capital asset for the purpose of taxation and hence, income under the head capital gain will arise on transaction of the same. 3. Tax on income from Cryptocurrencies [Section 115BBH] Income from transfer of cryptocurrencies will be taxed at the rate of 30% Deduction – No deduction of any expenditure except for cost of acquisition will be allowed Set off/ Carry forward of losses – No set off of losses against any income is allowed as well as carry forward of losses in this respect is also not allowed The following should be ignored while computing capital gains on transfer of cryptocurrencies i) Cost of improvement relating to the asset ii) Selling expenses i.e. the expenditure incurred in connection with the transfer of virtual digital asset iii) Indexation of cost of acquisition iv) Any exemption under section 54F

Further, no deduction under Chapter VI-A shall be allowed. However, relief under section 87A i.e. rebate can be claimed. 4. Applicability of TDS provisions [Section 194S] A new section 194S is proposed to be inserted in The Income Tax Act, 1961 w.e.f. 01.07.2022 regarding TDS.

Deductor – Any person responsible for paying any sum by way of consideration for the transfer of cryptocurrency

Deductee – Tax is required to be deducted if the amount is payable to a resident person

Rate of TDS – 1% of consideration When to deduct – At the time of payment or at the time of credit of such sum to the account of resident, whichever is earlier Exemption from TDS – 1. If consideration is payable by any person (other than a specified person) and its aggregate value does not exceed Rs. 10,000 during the financial year
If consideration is payable by a specified person and its aggregate value does not exceed Rs. 50,000 during the financial year Meaning of “specified person” – An individual or a HUF, whose total sales, gross receipts does not exceed Rs. 1 crore in case of business or Rs. 50 lakh in case of a profession, during the financial year immediately preceding the financial year in which such virtual digital asset is transferred An individual or a HUF who does not have any income under the head profits and gains of business or profession.

Section 80EEB: Deduction in respect of purchase of electric vehicle

To promote the use of Electric vehicles in India, the government come up with new section to give tax relief to EV buyers.

Eligible Assessee: An Individual who has taken a loan for purchase of E-Vehicle from any Financial Institution and who has never owned an E-vehicle can avail such tax relief. Further, Interest payable on such loan would qualify for deduction under Section 80EEB

Conditions: The Assessee should be an Individual (i.e. Deduction not available to any other taxpayer), Loan should be taken for purchase of an E-vehicle for personal use or business use. In case of business use any interest payment above Rs.1,50,000/- can be claimed as a business expense. To claim as a business expense, it is necessary that vehicle should be registered in the name of the owner or the business enterprise. Loan should be sanctioning during the period between 01.04.2019 and 31.03.2023, Loan should be sanctioned by a FI(i.e bank or specified NBFCs).

Period of Benefit: The benefit of deduction under this section would be available from A.Y 2020-2021 and subsequent assessment years till the repayment of loan continues. Not just the Income tax benefit, an EV purchase will also bring you tax benefit on GST, with the government having cut the rate to 5% from the earlier 12%.

Quantum of deduction Interest payable: Subject to a maximum of Rs.1,50,000/-and such Interest would not be allowed as deduction under any other provision of the Act for the same or any other assessment year. Further note that deduction is available only on Interest paid not on Principal payment. Do note that an individual taxpayer should obtain the interest paid certificate and keep the necessary documents such as tax invoice and loan documents handy at the time of filing of the return.

Meaning Financial Institution(FI): FI means A banking company to which the Banking Regulation Act, 1949 applies, or Any bank or banking institution referred to in section 51 of that Act and Any deposit taking non-banking financial company (NBFC) or A systemically important non-deposit taking NBFC i.e., a NBFC which is not accepting or holding public deposits and having total assets of not less than Rs.500 crore as per latest audited financial statements and is registered with RBI. E-Vehicle: “electric vehicle” means a vehicle which is powered exclusively by an electric motor whose traction energy is supplied exclusively by traction battery installed in the vehicle and has such electric regenerative braking system, which during braking provides for the conversion of vehicle kinetic energy into electrical energy.

Filing of Updated IT Return:

Earlier, you only had a window of 5 months from the due date of filing returns, to revise the tax returns. Now, there is a new provision introduced that allows filing updated tax returns within a period of two years from the end of the relevant assessment year. However, the updated return cannot be filed to report additional loss or decrease in the tax liability. This provision is introduced to provide an opportunity to include missed or undisclosed income or any other error leading to less filing of tax in the original tax return. When reporting such additional income, the taxpayer would also be required to pay additional tax at the rate of 25% if the updated return is filed between 1 to 12 months (1st year) or 50% on the additional tax if the updated return is filed between 13 to 24 months (2nd year) from the end of the relevant assessment year. The tax is required to be paid before the filing of the updated tax return and proof to that extent is required to be attached while filing the updated return.

Tax relief on Covid-19 treatment expenses and compensation:

As per the Press Release on June 2021, tax exemption has been provided to persons who have received money for Covid medical treatment. Likewise, money received by family members on the death of a person due to Covid will be exempt up to Rs. 10 lakhs for family members if such payment is received within 12 months from the date of death. This amendment will be effective retrospectively from April 1, 2020.

New tax rules on EPF Interest:

Effective April 1, the tax will be imposed on interest earned on the contribution to Employees Provident Fund (EPF) if the amount is in excess of the threshold limit of Rs. 2.5 lakh every year. This new rule is governed under section 9D of the Income-Tax Act. For the purpose of calculation, the contribution to the PF accounts up to Rs. 2.5 lakh is tax-free. But, if an employee contributes in excess of the above-mentioned limit, the tax will be imposed on the interest portion earned on the excess contribution. It is important to note that only the interest amount on the excess contribution will be considered for tax calculation, and not the contribution amount. This rule has been introduced targeting the high-class taxpayers, preventing them from taking advantage of the government-backed scheme. Because they would park their excess funds in EPF to earn tax-free interest. However, low and middle-class taxpayers will not be affected by this rule. For example, if an employee contributes Rs. 5 lakhs to EPF in a year, out of that Rs. 2.5 lakhs will be taxable and interest on that part shall be taxed in the hands of the employee year after year.

Reopening of assessment with incorrect reasons is bad in law

We observe that Assessing Officer completed the assessment based on the reasons recorded for reopening that assessee has received share application money from Mr. Shirish C. Shah, who provides accommodation entries. Subsequently when the remand report filed before Ld.CIT(A) in which Assessing Officer has agreed that share applicants do not belong to Shri Shirish C. Shah group. Accordingly, Ld.CIT(A) has held that Assessing Officer issued 148 notice with the incorrect reasons. Therefore Ld.CIT(A) allowed the appeal of the assessee for reopening the assessment with incorrect reasons which is bad in law. In light of the above facts on record, we do not see any reasons to interfere with the above findings of the Ld.CIT(A). Accordingly, appeal filed by the Revenue is dismissed.

ACIT vs. Rakhi Properties and Leasing Pvt. Ltd. (ITAT Mumbai)

INCOME TAX CIRCULARS & NOTIFICATIONS

Compiled by
CA. Aloke R. Singh

Income Tax Circulars
Circular No	Date of Issue	Subject
04/2022	15.03.2022	Deduction of Tax at Source – Income-tax Deduction from Salaries under section 192 of the Income-tax Act, 1961
05/2022	16.03.2022	Relaxation from the requirement of electronic filing of application in Form No.3CF for seeking approval under section 35(1 )(ii)/(iia)/(iii) of the Income-tax Act,1961 (the Act)
06/2022	17.03.2022	Condonation of delay under section 119(2)(b) of the Income-tax Act, 1961 in filing of Form 10-IC for Assessment Year 2020-21
07/2022	30.03.2022	Clarification with respect to relaxation of provisions of rule 114AAA of Income-tax Rules, 1962 prescribing the manner of making Permanent Account Number (PAN) inoperative
08/2022	31.03.2022	Extension of time line for electronic filing of Form NO.10AB for seeking registration or approval under Section 10(23C), 12A or 80G of the Income-tax Act,1961 (the Act)

Income Tax Notifications
Notification No	Date of Issue	Subject
15/2022	28.03.2022	Faceless Jurisdiction of Income-tax Authorities Scheme, 2022
16/2022	28.03.2022	The Central Government hereby specifies for the purpose of section 3(1) of the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, that where the specified Act is the Prohibition of Benami Property Transaction Act, 1988, and the completion of any action, as referred to in section 3(1)(a) of the said Act, relates to passing of any order u/s 26(3) of the Benami Act,— (i) the 30th day of June, 2021 shall be the end date of the period during which the time limit specified in or prescribed or notified under the Benami Act falls, for the completion of such action; and (ii) the 30th day of September, 2022 shall be the end date to which the time limit for completion of such action shall stand extended.
17/2022	29.03.2022	Income-tax (Third Amendment) Rules, 2022 notified. Sub-rule (5A) inserted after sub-rule (5) of Rule 114, w.e.f. 01.4.2022.
18/2022	29.03.2022	E-Assessment of Income Escaping Assessment Scheme, 2022 notified.
19/2022	30.03.2022	Faceless Inquiry or Valuation Scheme, 2022, notified.

Income Tax Notifications
Notification No	Date of Issue	Subject
20/2022	30.03.2022	Notification under sub-section (1G) of section 206C of the Income-tax Act, 1961 in relation to non-resident individual visiting India.
21/2022	30.03.2022	Income-tax (Fourth Amendment) Rules, 2022 notified. Amendments made in Rule 12 regarding ITR forms for AY 2022-23 to be effective from 01.4.2022.
22/2022	31.03.2022	The Central Government hereby notifies the infrastructure debt fund namely, the ‘the Kotak Infrastructure Debt Fund Limited (PAN : AAACK5920G)’ u/s 10(47), for the assessment year 2018-19 and subsequent years subject to the following conditions, namely:- (i) that the infrastructure debt fund shall conform to and comply with the provisions of the Income-tax Act, 1961, Rule 2F of the Income-tax Rules, 1962 and the conditions provided by the Reserve Bank of India in the regard, and (ii) that the infrastructure debt fund shall file its return of income as required by the sub-section (4C) of section 139 of the Income-tax Act, 1961 on or before the due date.
23/2022	01.04.2022	Income-tax (Fifth Amendment) Rules, 2022 notified. Substitution of Form ITR 7 in Appendix-II, for the AY 2022-23, w.e.f. 01.4.2022.

CHARITABLE TRUSTS UPDATES

By Adv. Hemant Gandhi &
CA Premal Gandhi

Restriction on extending benefit to specified person’s u/s 13 of The Income-tax, 1961. [Applicable from Assessment Year 2023-24]

Under Section 13, trusts or institutions registered under Section 12AA/12AB are required not to pass any unreasonable benefit to the trustee or any other specified person.

The Finance Bill, 2022 has inserted twenty-first proviso in Section 10(23C) of the Act to provide that where the income or part of income or property of any trust or institution has been applied directly or indirectly for the benefit of any person referred to in Section 13(3), such income or part of income or property shall be deemed to be the income of such person of the previous year in which it is so applied. The provisions of Section 13(2), (4) and (6) of the Act shall also apply to trust or institution referred to in Section 10(23C).

Who is an Interested Person?

The following are categorized as ‘interested person’:

The author of the trust or the founder of the institution.
Any person who has made a total contribution up to the end of the relevant previous year of an amount exceeding Rs. 50,000.
Where author, founder or substantial contributor is an HUF, a member of the HUF.
Any trustee of the trust or manager of the institution.
Any relative of such author, founder, substantial contributor, member, trustee or manager as aforesaid; and
Any concern in which any of the persons referred to above has a substantial interest.

Meaning of relative

Relative in relation to an individual means:

His spouse.
His brother or sister.
Spouses of his brother or sister.
Brother or sister of his spouse.
Spouses of brother or sister of his spouse.
His lineal ascendant or descendant and of his spouse.
Spouses of any of his lineal ascendant or descendant.
Spouses of his spouse’s lineal ascendant or descendant.
Any lineal descendant of his or his spouse’ brother or sister.

Meaning of Substantial Interest

A person is deemed to have substantial interest in a concern if he (or along with interested persons as mentioned above) at any time during the previous year:

Holds at least 20% of equity share capital, in case of company; or
Entitled to at least 20% of profits, in case of any other concern.

Benefit of medical or educational services

Where a charitable or religious trust is running a hospital or a medical institution, or an educational institution and it provides medical or educational services to interested persons, the value of medical/ educational services is deemed to be the income of the trust or institution derived from property held under trust. The value of such services is chargeable to tax during the previous year in which such services are rendered. The exemption of Section 11 or Section 10(23C) shall not apply to the value of such services.

When is an Interested Person deemed to be benefited?

The income or the property of the trust shall be deemed to have been applied for the benefit of an interested person in the following cases:

Loan without adequate interest or security

An interested person is deemed to be benefited if any part of the income or property of the trust or institution is (or continues to be) lent to any interested person for any period during the previous year without either adequate security or adequate interest or both.
Use of property without adequate rent

An interested person is deemed to be benefited if any land, building or other property of the trust or institution is (or continues to be) made available for use by any interested person, for any period during the previous year without charging adequate rent or other compensation.
Excess payment of salary

An interested person is deemed to be benefited if any amount is paid by way of salary, allowance or otherwise during the previous year to any interested person, out of the resources of the trust or institution for services rendered by that person to such trust or institution, and the amount so paid is in excess of what may be reasonably paid for such services.
Inadequate remuneration for services rendered

An interested person is deemed to be benefited if the services of the trust or institution are made available to any interested person during the previous year without adequate remuneration or other compensation.
Excess payment for purchases

An interested person is deemed to be benefited if any share, security or other property is purchased by or on behalf of the trust or institution from any interested person during the previous year for consideration which is more than adequate consideration.
Inadequate consideration for sales

An interested person is deemed to be benefited if any share, security or other property is sold by or on behalf of the trust or institution to any interested person during the previous year for consideration which is less than adequate consideration.
Diversion of income

An interested person is deemed to be benefited if any income or property of the trust or institution is diverted during the previous year in favour of the interested person and the aggregate value of such income and property exceeds Rs. 1,000.
Investment in concern

An interested person is deemed to be benefited if any funds of the trust or institution are, or continue to remain, invested for any period during the previous year, in any concern in which the interested person has a substantial interest.

However, if the aggregate of funds invested in concern, in which any interested person has a substantial interest, does not exceed 5% of capital of that concern, exemption under Section 11 will be denied only from the income arising to the trust from such investment. In other words, in such a case, the exemption under section 11 will not be denied for any income other than the income as arises out of the said investment.

The Calcutta High Court in the case of CIT v. Birla Charity Trust (1987) 34 Taxman 504 (Cal.) observed that if the funds of the trust are construed to include assets (other than money in hand or cash or a credit balance in bank account) the same are not capable of being invested as such. Other assets of the trust, apart from money in hand or cash, will have to be converted into money or cash before the same can be invested. Therefore, only cash and bank balances are included in the expression of ‘Funds’ of the purpose of Section 13(2)(h).

GOLDEN RULES OF INVESTMENT

By Mr. Tushar P. Joshi

We buy our dream Home either by Loan option i.e. EMI or through our hard earned saved money and the investment involved is also in crores. Hence I suggest that insuring your Home is as important as insuring your Life.

Recently we witnessed accidental fire at One Avighna Tower – Parel, Mumbai. Also, massive earthquakes in Ahmedabad and Bhuj before a few decades are the incidents which emphasize us to think for insuring our properties.

If the property is in a society or an independent high-rise, normally by and large as per the statutory requirements; all building structures are to be insured. However, if you intend to insure your belongings in the house, you need to specifically ask for the contents cover. It is advisable to prepare the list of all the items like Electrical Equipment, Electronics, and Furniture & Fixtures etc.

Normally coverage includes damage due to Fire, Short circuit, Lightening, Cyclone, Flood etc. Nowadays, terrorism is also clubbed in the policy. The coverages are on reinstate basis. For Burglary and Theft separate coverage is available.

In case of any mishaps, policy holder will receive compensation for the replacement value of their insured property and contents inside the house.

But question that arise in our mind is as to what value should be considered for insuring the property- Market Value, Cost of Construction or Cost of Acquisition? My view is that: it has to be taken at present Cost of Construction only.

I would suggest home loan borrowers to get this cover. Normally home loan agreements contain a standard clause that requires lenders to insure their house adequately against disasters. However even otherwise it is in your interest to get your home insured.

Even if it is not compulsory to buy home insurance, it makes sense to opt for one. Else, in the event of damages caused by earthquake or any natural disaster, the borrower will have to bear the losses.

Lastly, always select the advisor who will be available in case of emergency or claim instead of online policy vendors, the value of which you will realise in case of claims only.

UPDATES ON FINANCE

Compiled by
CA. Pratik B. Satyuga

Highest 1 Year FD Rates (As on 01st April 2022) < Rs 2 Crore.

Institution	1 Year FD Rate
Equitas Small Finance Bank	6.00%
Yes Bank	6.00%
Indusind Bank	6.00%
RBL Finance Bank	6.25%
Jana Small Finance Bank	6.75%

Note : Senior Citizens would generally get 0.50% more than the above mentioned rates.

Post Office Deposit Rates (As on 01st April 2022).

Particulars	Rate of Interest	Maximum Deposit (Rs)
Post Office Saving Account	4.00% p.a.	No Limit
National Saving Recurring Deposit Account	5.8% p.a. (Quarterly Compounded)	No Limit
National Saving Time Deposit Account	5.5% p.a. (Upto 3 Yrs)	No Limit
Senior Citizen Saving Scheme Account (SCSS)	7.40% p.a.	15,00,000/- p.a.
Public Provident Fund (PPF)	7.1% p.a. (Annually Compounded)	1,50,000/- p.a.
National Savings Certificates (NSC)	6.8% p.a. (Annually Compounded)	No Limit
Kisan Vikas Patra (KVP)	6.9% p.a. (Annually Compounded)	No Limit
Sukanya Samriddhi Accounts	7.6% p.a. (Annually Compounded)	1,50,000/- p.a.

Lowest Home loan Rates for Self Employed Professionals (As on 01st April 2022).

Institution	Rate
Union Bank of India	6.60% onwards
Kotak Mahindra Bank	6.55% onwards
Saraswat Co-op Bank	6.70% onwards
HDFC Bank	6.70% onwards
HSBC Bank	6.45% onwards

Top Performing Mutual Funds (As on 01st April 2022).

Fund Name	Current NAV	1 Year Returns
Invesco India Infra – Direct (G)	35.53	63.20%
Axis Small Cap Fund – Direct (G)	68.83	69.22%
Invesco India Infra –(G)	29.25	58.28%
Axis Small Cap Fund (G)	68.25	69.25%

Major Currency Rates (As on 01st April 2022).

Country	In Rs. on 01/04/21	In Rs. on 01/03/22	In Rs. on 01/04/22	Change MoM (Rs)	YTD Returns
United States of America (USA) – USD($)	73.13	75.75	75.54	-0.28%	3.58%
United Kingdom (UK) – GBP (₤)	101.34	100.93	98.96	-1.95%	-0.40%
European Union (EU) – Euro (€)	86.30	83.78	83.05	-0.87%	-2.92%

Major Commodity Rates (As on 01st April 2022).

Commodity	Rate on 01/04/21	Rate on 01/03/22	Rate on 01/04/22	Change MoM	YTD Returns
Gold (MCX) – 10 Gms	45,420.00	51,564.00	51,290.00	-0.53%	13.52%
Silver (MCX) – 1 Kg	65,092.00	67,904.00	66,820.00	-1.60%	4.32%
Crude Oil (MCX) – 1 Unit (BBL)	4,515.00	9,830.00	7,726.00	-21.40%	117.71%

Indian Indices

Index	1st April 2021	1st March 2022	1st April 2022	MoM Returns	YTD Returns
Sensex (BSE)	50,029.83	55,468.90	59,276.69	6.86%	10.87%
Nifty 50 (NSE)	14,867.35	16,605.95	17,436.90	5.01%	11.69%
Bank Nifty	33,858.00	35,372.80	37,148.50	5.01%	4.47%

Global Indices

Index	1st April 2021	1st March 2022	1st April 2022	MoM Returns	YTD Returns
Dow Jones (USA)	33,153.21	33,813.48	34,818.27	2.97%	1.99%
Nasdaq (USA)	13,480.11	13716.70	14261.50	3.97%	1.75%

Disclaimer : Utmost care has been taken to present accurate figures. However, the reader is advised to verify the same and consult a Financial Advisor before taking any financial decision.

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GSTPAM News Bulletin Committee for Year 2021-22

Parth Badheka
Chairman

Jatin N. Chheda
Jt. Convenor

Aloke R. Singh
Jt. Convenor

This News Bulletin is available on GSTPAM website
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