Daily updates-Income tax, GST & Corporate Laws

1. Corporate Laws  

(i) MCA allows companies to conduct their EGMs via. e-mode up to Sep 30, 2020

The Ministry of Corporate Affairs (MCA) is fully cognizant of the difficulties faced by companies on account of the ongoing nation-wide lockdown and social distancing due to COVID 19. The Ministry has also taken note of various representations received from industry associations and corporates on the need to facilitate companies in taking certain emergent/ urgent measures in the face of extreme disruptions and dislocation caused by the pandemic.

MCA vide General Circular No. 22/2020 Dated:  15.06.2020 has been decided to allow companies to conduct their EGMs through VC or OAVM or transact items through postal ballot in accordance with the framework provided in the aforesaid Circulars upto 30th September, 2020. All other requirements provided in the said Circulars remain unchanged.

(ii) MCA allows companies to hold Annual General Meetings (AGMs) through VC or OAVM

The Ministry of Corporate Affairs (MCA) vide its General Circular No. 18/2020, dated 21.04.2020 has already allowed the companies whose financial year ended on 31st December, 2019, to hold their AGM by 30th September, 2020.

However on account of need for continuous adherence to the social distancing norms and restrictions placed on movement of persons, it has become necessary and hence it has been decided to allow companies to hold their annual general meeting (AGM) by Video Conferencing (VC) or other audio visual means (OAVM) during the calendar year 2020. Accordingly, the General Circular No: 20/2020 has been issued on 05 May 2020.

The framework provided in the earlier Circulars for holding of extraordinary general meeting (EGM) would be applicable mutatis mutandis for conduct of AGMs during 2020, based on the classification of companies which are required to: (i) provide the facility of e-voting or have opted for the same, and (ii) those companies which are not required to provide such a facility.

Owing to the difficulties in sending physical copies of the financial statements, the Circular allows the companies to send the financial statements, along with Board’s reports, Auditor’s reports and other documents required to be attached therewith, only through email. The companies are also required to provide a window to the shareholders for registering their mandate for transferring dividends electronically to them through the Electronic Clearing Service (ECS) or any other means.

The measure has been taken to facilitate Companies to conduct their ordinary & special business through AGMs conducted by leveraging the Digital India platforms.

MCA General Circular No. 20/2020 dated 05 May 2020

2.Income tax

  • CBDT notifies Income Tax Cost Inflation Index for Financial Year 2020-21 or Assessment Year 2021-22 vide  Notification No. 32/2020-Income Tax dated 12th June 2020 at 301. Cost Inflation Index helps taxpayer calculation his Long Term Capital Gain on sale of Long Term Capital Assets.
  • CBDT notifies Form ―Sahaj (ITR-1), Form ITR-2, Form ITR-3, Form Sugam (ITR-4), Form ITR-5, Form ITR-6, Form ITR-7 and Form ITR-V for Assessment Year 2020-21 i.e. financial Year 2019-20. (Notification No. 31/2020-Income Tax dated 29th May 2020
  • CBDT notifies new Form 26AS [Annual Information Statement]

CBDT notifies new Form 26AS [Annual Information Statement] pursuant to Finance Act, 2020 and amendment, inserts new Rule 114-I to be effective from June 1st and omits Rule 31AB.

Budget 2020-21 had introduced a new Section 285BB in the Income Tax Act to implement revised Form 26AS . In that effect CBDT has notified new FORM 26AS [Annual Information Statement] via Notification No. 30/2020 dated 28th May 2020, Rule 31AB has been omitted and Rule 114-I has been inserted after Rule 114H to share annual financial information in respect of each taxpayer not only of taxes paid by of TDS/TCS or otherwise.

This form will also have mobile no, email I’d and Aadhar no. of the taxpayer.

Information on this form 26AS will not be a onetime affair at year end. This will be a live 26AS , as this will be updated regularly within 3 months from the end of the month in which such information is received.

The revised 26AS Form is more comprehensive and informative and will be a complete profile of the taxpayer for a particular year

The implication of this new form 26AS will be that banks, financial institutions or any other authority or customer , buyer etc. while carrying out due diligence of the person/corporate ,concerned will now ask for form 26AS so as to be sure that there are not any major issues about such person/ corporates.

As a result of introduction of New 26AS now it will be difficult for any taxpayer to hide information from any bank / financial institution/ authority about any proceedings against under any law or tax demand , tax disputes etc .

Notification No. 30/2020–dated 28 May 2020

3.GST   

  • Recommendations of GST council related to Law & Procedure

a. Reduction in Late Fee for past Returns:

b. Further relief for small taxpayers for late filing of returns for February, March & April 2020 Tax periods:

c. Relief for small taxpayers for subsequent tax periods (May, June & July 2020):

d. One time extension in period for seeking revocation of cancellation of registration

Ministry of Finance, Press Release dated 12 June 2020

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