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Judicial updates (GST & Income Tax) -11 Jan 2022

Posted on by Business So Simple in GST, Income Tax, Legal awareness

GST

Patna HC Quashes GST order passed in violation of Principles of Natural Justice

Sky Vision Media Private Limited Vs State of Bihar (Patna High Court) dated 04 Jan 2022

Cash credit account cannot be provisionally attached- HC issues contempt notice to Principal Commissioner

Manish Scrap Traders Vs Principal Commissioner (Gujarat High Court) dated 05/01/2022

Levy of basic excise duty & NCCD not violative of Article 14 of Constitution

V.S. Products Vs Union of India (Karnataka High Court) dated 04/01/2022

HC quashes Order for not providing hearing opportunity to Assessee

Naresh Aggarwal Agencies Pvt. Ltd. Vs State of Punjab & anr. (Punjab and Haryana HC) dated 21/12/2021

INCOME TAX

Penalty cannot be imposed merely for non-filing of Audit Report Electronically

SLV Housing Development Corporation Vs ACIT (ITAT Bangalore) dated 22/11/2021

CIT cannot invoke section 263 if there was lack of inquiry from the end of AO

Pushp Steel and Mining Private Ltd. Vs PCIT (ITAT Delhi) dated 22/12/2021

RPM method used by Taxpayer cannot be rejected without pointing defect in the same

Randox Laboratories India Private Limited Vs ACIT (ITAT Bangalore) dated 04/01/2022

Regards,

Bipul Kumar

CBDT extends due dates for filing of Income Tax Returns and various reports of audit for the Assessment Year 2021-22 under the Income-tax Act, 1961 (Press release 11th Jan 2022)

Posted on by Business So Simple in Income Tax

On consideration of difficulties reported by the taxpayers and other stakeholders due to COVID and in electronic filing of various reports of audit under the provisions of the Income-tax Act, 1961 (the Act), the Central Board of Direct Taxes (CBDT) has decided to further extend the due dates for filing of Income Tax Returns and various reports of audit for the Assessment Year 2021-22. The further details are as under:

  1. The due date of furnishing of Report of Audit under any provision of the Act for the Previous Year 2020-21, which was 30th September, 2021, in the case of assessees referred in clause (a) of Explanation 2 to sub-section (1) of section 139 of the Act, as extended to 31st October, 2021 and 15th January, 2022 by Circular No.9/2021 dated 20.05.2021 and Circular No.17/2021 dated 09.09.2021 respectively, is further extended to 15th February, 2022; 
  2. The due date of furnishing of Report of Audit under any provision of the Act for the Previous Year 2020-21, which was 31st October, 2021, in the case of assessees referred in clause (aa) of Explanation 2 to sub-section (1) of section 139 of the Act, is extended to 15th February, 2022;
  3. The due date of furnishing of Report from an Accountant by persons entering into international transaction or specified domestic transaction under section 92E of the Act for the Previous Year 2020-21, which was 31st October 2021, as extended to 30th November, 2021 and 31st January, 2022 by Circular No.9/2021 dated 20.05.2021 and Circular No.17/2021 dated 09.09.2021 respectively, is further extended to 15th February, 2022;
  4. The due date of furnishing of Return of Income for the Assessment Year 2021-22, which was 31st October, 2021 under sub-section (1) of section 139 of the Act, as extended to 30th November, 2021 and 15th February, 2022 by Circular No.9/2021 dated 20.05.2021 and Circular No.17/2021 dated 09.09.2021 respectively, is further extended to 15th March, 2022;
  5. The due date of furnishing of Return of Income for the Assessment Year 2021-22, which was 30th November, 2021 under sub-section (1) of section 139 of the Act, as extended to 31st December, 2021 and 28th February, 2022 by Circular No.9/2021 dated 20.05.2021 and Circular No.17/2021 dated 09.09.2021 respectively, is further extended to 15th March, 2022. 

It is also clarified that the extension of the dates as referred to in clauses (12) and (13) of Circular No.9/2021 dated 20.05.2021, clauses (4) and (5) of Circular No.17/2021 dated 09.09.2021 and in clauses (4) and (5) above shall not apply to Explanation 1 to section 234A of the Act, in cases where the amount of tax on the total income as reduced by the  amount as specified in clauses (i) to (vi) of sub-section (1) of that section exceeds rupees one lakh. Further, in case of an individual resident in India referred to in sub-section (2) of section 207 of the Act, the tax paid by him under section 140A of the Act within the due date (without extension under Circular No.9/2021 dated 20.05.202, Circular No. 17/2021 dated 09.09.2021 and as above) provided in that Act, shall be deemed to be the advance tax.

CBDT Circular No.01/2022 in F.No.225/49/2021/ITA-II dated 11.01.2022 issued. The said Circular is available on www.incometaxindia.gov.in.

ED has attached assets worth valued at Rs.36,72,47,752/- of Nishad K, MD and his associates in the case of Morris Coin Crypto Currency Case under the Prevention of Money Laundering Act ,2002 in a cheating case (Press release dated 10th Jan 2022)

Posted on by Business So Simple in FEMA, PMLA

Enforcement Directorate has attached assets worth valued at Rs.36,72,47,752/- of Nishad K, MD and his associates in the case of Morris Coin Crypto Currency Case under the Prevention of Money Laundering Act ,2002 in a cheating case. The attached assets include balances in multiple bank accounts of Nishad K and his companies, immovable property including land of an associate close to Nishad K and INR equivalent of crypto currencies purchased out of the proceeds of crime by a close associate.

ED initiated money laundering investigation on the basis of the FIR registered by Kerala Police. Kerala Police has registered multiple FIRs in various districts such as Malappuram, Kannur and others. As per the FIRs, more than 900 investors were cheated to the tune of Rs 1200 crore.

The money laundering investigation carried out so far revealed that Nishad K through his various companies such as M/s Long Rich Global, M/s Long Rich Technologies and M/s Morris Trading Solutions collected deposit money from the investors in the guise of Initial Coin Offer for the launch of Morris Coin Crypto Currency. Investors were impressed by conducting promotional events in the presence of celebrities, introducing the investors to flashy websites by provision of e wallets to each investor via web-based applications. The amounts so collected by duping. the investors were siphoned through various companies operated by him and his associates.

The deposits taken from the general public were illegal and without any statutory permission from any regulatory agencies. This was a ponzy schemes & investors were lured with the promise of very high return.

The money obtained was used for the purchase immovable properties, for the purchase of various other Crypto currencies, for the purchase of luxury cars and for spending in luxury hotels and resorts. In this regard, the crypto currencies such as Ethereum (5.92387265), BTC (0.08267646), BNB (5.51232875), YFI (0.023062), VET (4284.4), ADA (226.479601), USDT (35.88576551) totally valued at INR 25,82,794 were found and all the above crypto currencies, purchased out of the proceeds of crime, were converted into INR and attached by the Enforcement Directorate.

In addition, a search action was conducted under Section 17 of the PMLA,2002 at 11 premises situated across various States such as Kerala, Karnataka, Tamilnadu and New Delhi resulting in identification of details worth of several Crore of immovable and other property details. The premises includes the residential and office premises of the entities that are related to Nishad K and his companies.

Further investigation is under progress.

Gujarat ROC Penalty order for non maintaining of Registered office (Section 12(1) violation) passed on dated 28th Dec 2021 in the matter of Tunwale E Vehicle India Pvt. Ltd.

Posted on by Business So Simple in Company Law

Gujarat ROC Penalty order for non maintaining of Registered office (Section 12(1) violation) passed on dated 28th Dec 2021 in the matter of Tunwale E Vehicle India Pvt. Ltd.

Published on 10th Jan 2022

Penalty imposed as per Section 12 (8)- If any default is made in complying with the requirements of this section, the company and every officer who is in default shall be liable to a penalty of one thousand rupees for every day during which the default continues but not exceeding one lakh rupees.

Section violated: 👉 Section 12 (1) A company shall, [within thirty days of its incorporation] and at all times thereafter, have a registered office capable of receiving and acknowledging all communications and notices as may be addressed to it.

Section 12 (4) Notice of every change of the situation of the registered office, verified in the manner prescribed, after the date of incorporation of the company, shall be given to the Registrar [within thirty days] of the change, who shall record the same.

CCI Order u/s 43A, 44 & 45 of the Competition Act, 2002 in the case of Amazon.com NV Investment Holding LLC-(Penalty imposed u/s 43A- 200 Cr. , u/s 44 -1 Cr. , u/s 45- 1 Cr)

Posted on by Business So Simple in Competition Law

CCI Order u/s 43A, 44 & 45 of the Competition Act, 2002 in the case of Amazon.com NV Investment Holding LLC-(Penalty imposed u/s 43A- 200 Cr. , u/s 44 -1 Cr. , u/s 45- 1 Cr)

In terms of Section 43A of the Act, if any person or enterprise fails to give notice under sub-section (2) of Section 6 of the Act, the Commission shall impose on such person or enterprise a penalty which may extend to one percent of the total turnover or the assets, whichever is higher, of such a combination. In case of a contravention under Sections 44 and 45 of the Act, each of the said provision renders the contravening person liable, inter alia, to a penalty, as provided therein. Though the penalty under Sections 43A, 44 and 45 of the Act can be to the extent mentioned therein, the Commission has sufficient discretion to consider the conduct of the parties and the circumstances of the case to arrive at an appropriate amount of penalty.

All the contraventions arise from a deliberate design on the part of Amazon to suppress the actual scope and purpose of the Combination, and the Commission finds no mitigating factor. Resultantly, the Commission considers it appropriate to levy the maximum penalty of INR One Crore each under the provisions of Section 44 and Section 45 of Act. Accordingly, Amazon is directed to pay a penalty of INR Two Crore.

As regards failure to notify combination in terms of the obligation cast under Section 6(2) of the Act, Section 43A of the Act enables the Commission to impose a penalty, which may extend to one percent of the total turnover or the assets, whichever is higher, of such a combination. Accordingly, for the above mentioned reasons, the Commission hereby imposes a penalty of INR Two Hundred Crore upon Amazon.

Income Tax Department conducts searches in Kerala (Press release dated 10th Jan 2022)

Posted on by Business So Simple in Income Tax

The Income Tax Department carried out search and seizure operation on 05.01.2022 on two groups, engaged in the business of quarry operation.  More than 35 premises spread across districts of Kottayam, Eranakulam, Thrissur, Palakkad and Kannur have been covered in the search operation.

During the course of the search operation, various incriminating documents and digital evidences have been found and seized, including a parallel set of books of account recording the entries of actual sales and receipt of cash. These evidences have clearly revealed the modus operandi being followed by the quarry operators as they are indulging in large scale suppression of sales made in cash including the fact that these transactions are not recorded in the regular books of account of the group. 

The correlation of these evidences also indicates that unaccounted cash so generated is systematically invested in acquisition of immovable properties, used for the business of cash loans, and unrecorded capital investments in other businesses. The search team has also gathered evidences of on-money payment for purchase of properties and substantial cash deposits in undisclosed bank accounts. The assessees of the group have been found to have sold immovable properties without duly accounting for the capital gains arising from such transactions.

The search action has resulted in seizure of unaccounted cash of more than Rs 2.30 crore.

So far, the search has led to the detection of estimated unaccounted income to the tune of Rs. 200 crore. 

Further investigations are in progress.

Income Tax Department conducts searches in Andhra Pradesh and Telangana (Press release dated 10th Jan 2022)

Posted on by Business So Simple in Income Tax

The Income Tax Department carried out search and seizure operation on 05.01.2022 on three real estate developers, engaged in the business of land development as well as construction activities in the town of Kurnool and other mofussil areas of Andhra Pradesh and Telangana. More than two dozen premises have been covered in the search operation spread over Kurnool, Ananthapur, Kadapa, Nandyal, Bellary, etc.

During the course of the search operations, several incriminating documents, such as handwritten books, agreements, etc. have been found and seized. Digital data has also been seized from a specialized software application as well as from other electronic gadgets. It has been found in the case of one of the assessee groups that it has been using a software which has been systematically modified to eliminate the unaccounted cash element of the consideration received and to record in the regular books of account the sale consideration that matches with registered sale price.

These groups have been found to be accepting cash over and above the registered value of the properties. Such unaccounted cash is used for payments of on-money towards the purchase of lands and incurring other expenditure.

So far, the search action has led to the seizure of unaccounted cash of Rs.1.64 crore.

The search has resulted in the detection of unaccounted cash transactions to the tune of Rs. 800 crore.

Further investigations are in progress.

Startup India Innovation Week (10th -16th of January 2022)

Posted on by Business So Simple in Startups

Centre to organize the FIRST EVER Startup India Innovation Week from 10th -16th of January 2022.


Event to bring together country’s key startups, entrepreneurs, investors, incubators, funding entities, banks, policymakers etc under one platform to celebrate entrepreneurship and promote innovation

“Startup India Innovation Week”

designed to showcase the spread and depth of entrepreneurship across India.

The Department for Promotion of Industry and Internal Trade (DPIIT) is organizing the first-ever Startup India Innovation Week from 10th -16th of January 2022.  This virtual week-long innovation celebration aims to commemorate the 75th year of India’s independence ‘Azadi Ka Amrit Mahotsav’ and is designed to showcase the spread and depth of entrepreneurship across India.

Interestingly, in the startup world, 2021 has been recognised as the ‘year of unicorns,’ with 40+ unicorns added in the year.

 India is emerging as a global innovation hub, boasting the world’s third-largest startup ecosystem. DPIIT has recognised more than 61,000 startups as on date. Our startups representing 55 industries, spread across 633 districts with at least one startup from every State and UT of the country have created over 6 lakh jobs since 2016. 45% of the startups are from Tier-2 and Tier-3 cities and 45% of them are represented by women entrepreneurs. Startups have the potential to accelerate India’s integration into global value chains and create global impact.

This startup and innovation festival’s primary goal is to bring together the country’s key startups, entrepreneurs, investors, incubators, funding entities, banks, policymakers, and other national/international stakeholders to celebrate entrepreneurship and promote innovation. Furthermore, to exchange knowledge on nurturing startup ecosystems; to develop entrepreneurial ecosystem capacities; to mobilise global and domestic capital for startup investments; to encourage and inspire the youth for innovation and entrepreneurship; to provide market access opportunities to startups; and to showcase high-quality, high-technology, and frugal innovations from India.

With participation of States/UTs and various departments of Government of India, the week-long programme will address key aspects of the startup ecosystem through interactive sessions, workshops, and presentations based on themes such as Academia & Mentorship Support to Startups, Incubation and Acceleration Support to Startups, Market Access through Corporates & Government to Startups, and Funding & International Avenues to Go Global. In addition, based on the identified themes, there will be various parallel activities such as Experience Booths, Pitching or Reverse Pitching Sessions, and Innovation Showcases.

The link to the registration for the event is https://www.startupindiainnovationweek.in

Upcoming functionality – Interest Calculator in GSTR-3B (GST Portal updates -08 Jan 2022)

Posted on by Business So Simple in GST

Upcoming functionality – Interest Calculator in GSTR-3B

08/01/2022

1. As a facilitation measure for taxpayers & for assisting the taxpayers in doing a correct self-assessment, a new functionality of interest calculator is being released in GSTR-3B. This functionality will arrive at the system computed interest on the basis of the tax liability values declared by the taxpayers. The interest appliable, if any, on the tax liability declared in the GSTR-3B of a particular tax-period will be computed after the filing of the said GSTR-3B. These system computed interest values will be auto-populated in the Table-5.1 of the GSTR-3B of the next tax-period. The facility would be similar to the collection of Late fees for GSTR-3B, filed after the Due date, posted in the next period’s GSTR-3B.

2. This functionality has a user-friendly interface, which informs the taxpayers regarding the manner of system computation of interest values for each tax-head. This functionality also assists the taxpayers in doing correct computation of interest for the liability of any past period declared in the GSTR-3B for the current tax period, based on the details furnished by them on the portal.

3. This functionality will further improve ease of filing return under GST and is, therefore, in the direction of further reducing the compliance burden for taxpayers.-For the detailed advisory regarding the interest calculator in GSTR-3B, < Click here > .-For Annexure containing a sample computation with screenshots of the upcoming functionality,< Click here > .

4. This functionality, as and when available on the GST Portal shortly, will be intimated to the taxpayers.Thanking You,
Team GSTN