Category: Income Tax

Income tax Articles, Video updates, PPT

Revised Instruction for taxpayers’ grievances due to high-pitched Scrutiny Assessment (Press release 16 June 2022)

Posted on by Business So Simple in Income Tax, News Desk

Revised Instruction for constitution and functioning of Local Committees to deal with taxpayers’ grievances due to high-pitched Scrutiny Assessment.

In line with CBDT’s policy and commitment towards providing enhanced taxpayers’ services and reduce taxpayers’ grievances, CBDT has issued revised Instruction for constitution and functioning of Local Committees to deal with taxpayers’ grievances arising out of high-pitched Scrutiny Assessment through F.No.225/101/2021-ITA-II, dated 23rd April, 2022.

This instruction also provides for initiation of suitable administrative action against the officer concerned, in cases where assessments are found by the Local Committee to be high-pitched or where there is non-observance of principles of natural justice, non-application of mind or gross negligence of Assessing Officer/ Assessment Unit.

The revised Instruction dated 23rd April, 2022 in F.No.225/101/2021-ITA-II is available on www.incometaxindia.gov.in at https://incometaxindia.gov.in/Lists/Latest%20News/Attachments/518/Instrution-225-101-2021.pdf

Income Tax Department aims to spread tax literacy among children through games, puzzles and comics (MOF updates 12 June 2022)

Posted on by Business So Simple in Financial Prudence, Income Tax, News Desk

Moving beyond text based literature, awareness seminars and workshops, the Central Board of Direct Taxes (CBDT) has adopted a novel approach to spread tax literacy through ‘learn by play’ methods.  CBDT has brought out products to introduce concepts related to taxation, often perceived to be complicated, to high school students through board Games, puzzles and comics. 

Kick-starting this initiative, Union Finance Minister Nirmala Sitharaman launched a series of communication and outreach products aimed at spreading financial and tax awareness at the Closing Ceremony of the Azadi Ka Amrit Mahotsav Iconic Week in Panaji, Goa on Saturday evening. She termed the next 25 years as Amrit Kaal, and said youth would play a major role in shaping the new India. Smt. Sitharaman also distributed the first sets of the games to select school students present at the event. 

The novel products brought out by the CBDT are as follows : 


Snakes, Ladders and Taxes :  This board game introduces good and bad habits in respect of tax events and financial transactions. The game is simple, intuitive and educational with good habits being rewarded through ladders and bad habits penalized by snakes.

Building India :   This collaborative game introduces the concept of importance of paying taxes through the use of 50 memory cards based on infrastructure and social projects.  The game aims to convey the message that taxation is collaborative in nature and not competitive. 

India Gate – 3D Puzzle :  This game consists of 30 pieces, each containing information about various terms and concepts related to taxation.  The pieces when connected together will build a 3-dimensional structure of India Gate conveying the message that taxes build India. 


Digital Comic Books – Income Tax Department has collaborated with Lot Pot Comics to spread awareness about concepts of income and taxation among children and young adults. The messages are given by the immensely popular cartoon characters of Motu-Patlu, through their bone tickling dialogues. 
 
These products will be initially distributed to schools through the network of Income Tax offices spread across India.  A proposal to distribute these games through bookstores is also being worked out.

***

PIB Mum -001/DVK/CY

Follow us on social media: @PIBMumbai  Image result for facebook icon /PIBMumbai    /pibmumbai  pibmumbai@gmail.comRelease Id :-1833259

Press Release dated 12 June 2022

Link Aadhaar FAQ (Income tax portal updates-01st june 2022)

Posted on by Business So Simple in Income Tax, News Desk, Public Affairs

1. Who needs to link Aadhaar and PAN?
Section 139AA of the Income Tax Act provides that every person who has been allotted a permanent account number (PAN) as on the 1st day of July, 2017, and who is eligible to obtain an Aadhaar number, shall intimate his Aadhaar number in the prescribed form and manner. In other words, such persons have to mandatorily link their Aadhaar and PAN before the prescribed date (Presently, 31.03.2022 without fee payment and 31.03.2023 with prescribed fee payment For more details refer to CBDT circular No.7/2022 dated 30.03.2022.


2. For whom is Aadhaar-PAN linking not compulsory?
Aadhaar-PAN linking presently does not apply to any individual who is:

  1. residing in the States of Assam, Jammu and Kashmir, and Meghalaya;
  2. a non-resident as per the Income Tax Act, 1961;
  3. of the age of eighty years or more at any time during the previous year;
  4. not a citizen of India.

“The exemptions provided are subject to modifications depending on subsequent government notifications on this subject “ 
“For more details refer to Department of Revenue Notification no 37/2017 dated 11th May 2017″.


3. How to link Aadhaar and PAN?
Both registered and unregistered users can link their Aadhaar and PAN on the e-Filing portal, even without logging in. You can use the quick link Link Aadhaar on the e-Filing homepage to link Aadhaar and PAN.


4. How to make prescribed fee payment for PAN-Aadhaar Linkage?

The fee payment for PAN-Aadhaar Linkage need to be made through e-Pay Tax functionality available on NSDL (now Protean) Portal. The prescribed fee must be paid under Major Head 0021 and Minor Head 500 and AY should be 2023-24 using Challan ITNS 280.

5. Payment for the PAN-Aadhaar Linking has already been made but e-Filing Portal is not allowing to proceed further. What to do in this scenario? 
The payment made at NSDL (now Protean)  takes few days to reflect at the e-Filing portal, so taxpayer is advised to attempt raising PAN-Aadhaar linking request after 4-5 days of making payment.

6. If taxpayer made the payment under Minor head 500 mistakenly, how to get the refund for the same?
As per the existing legal framework, there is no provision for refund for such payments made under the minor head 500.

7. What will happen if I don’t link Aadhaar and PAN?
Kindly, refer to the Circular No. 7/2022 dated 30/3/2022.


8. I cannot link my Aadhaar with PAN because there is a mismatch in my name / phone number / date of birth in Aadhaar and PAN. What should I do?
Correct your details in either PAN or Aadhaar database such that both have matching details. You can correct your PAN details on:

You can correct your Aadhaar details on the UIDAI website.


9. What should I do if my PAN becomes inoperative?
Kindly, refer to the Circular No. 7/2022 dated 30/3/2022.

Clarification regarding Form No 10AC issued till the date of this Circular (CBDT Circular dated 03rd June 2022)

Posted on by Business So Simple in Income Tax, News Desk

1. Finance Act, 2022 has inserted sub-section (4) in section 12AB of the Income-tax Act, 1961 (the Act) allowing the Principal Commissioner or Commissioner of Income-tax to examine if there is any “specified violation” by the trust or institution registered or provisionally registered under the relevant clauses of sub-section (1) of section 12AB or subsection (1) of section 12AA. Subsequent to examination by the Principal Commissioner or Commissioner of Income-tax, an order is required to be passed for either cancellation of the registration or refusal to cancel the registration. Similar provisions have also been introduced in clause (23C) of section 10 of the Act by substituting the fifteenth proviso of the said clause with respect to fund or institution trust or institution or any university or other educational institution or any hospital or other medical institution referred under sub-clauses (iv), (v), (vi), (via) of this clause and which have been approved or provisionally approved under the second proviso to the said clause. These amendments are effective from 1st April, 2022. In addition to the specified violations referred above, the power of cancellation has also been granted under sub-rule (5) of rule 17A and sub-rule (5) of rule 2C of the Income-tax Rules, 1962 ( the Rules) to the Principal Commissioner or Commissioner authorised by the Board. This Circular only relates to cancellation of registration/approval or provisional registration/approval in the case of “specified violation”.

2. The definition of “specified violation” for the purposes of fifteenth proviso to clause (23C) of section 10 and section 12AB of the Act has been provided in the respective clause and section. The said definition, inter-alia, includes instances where any activity of the fund or trust or institution is not being carried out in accordance with all or any of the conditions subject to which it was approved/ provisionally approved or registered/provisionally registered.

3. It may be noted that as per the new procedure for approval/registration of charitable entities, which was notified vide Notification No 19/2021 dated 26.03.2021, the entities seeking re-registration/ approval or provisional registration/ approval (fresh) are required to file an application in Form 10A. Further, the order granting registration or provisional registration or approval or provisional approval is made in Form 10AC subject to the fulfilment of certain conditions.

4. In view of the amendments made vide Finance Act, 2022, the conditions subject to which the registration/approval or provisional registration/ provisional approval was granted to trusts and institutions need to be revised to align the same with the amendments made by Finance Act, 2022.

5.In view of the above, it is hereby clarified that,-

(i) the conditions contained in Form No. 10AC, issued between 01.04.2021 till the date of issuance of this Circular, shall be read as if the said conditions had been substituted with the conditions as provided in the Table 1 with effect from 1st April, 2022;

(ii) where due to technical glitches, Form No. 10AC has been issued during FY 20212022 with the heading “Order for provisional registration” or “ Order for provisional approval” instead of “Order for registration” or “ Order for approval”, then all such Form No. 10AC shall be considered as an “Order for registration or approval” and, in such cases where Form No. 10AC has been issued, –

(a) under section code 01 (applications seeking re-registration),-

(i) in the heading and in rows 6, 7, 9 and 10 the words ,“ provisional registration” shall be read as “registration”;

(ii) in row 8 the word “ provisionally registered” shall be read as “registered”;

(b) under section codes 03, 04, 05, 06 or 11 (applications seeking re-approval),-

(i) in the heading and in rows 6, 7, 9 and 10 the words ,“ provisional approval” shall be read as “approval”;

(ii) in row 8 the word “ provisionally approved” shall be read as “approved”;

(iii) row no 5 of Form No. 10AC ( issued for all section codes) shall be read as “Unique Registration Number” instead of “Provisional Approval/ Approval Number” or “ Provisional Registration/ Registration Number”, as the case maybe.

INCOME TAX : Rajasthan High Court grants refund of recovered tax in excess of 20% against disputed demand

Posted on by Business So Simple in Court Room, Income Tax, Legal awareness, News Desk

Case reference:

Ram Gopal Sharma Vs ITO (Rajasthan High Court) dated 23/05/2022

1. Learned counsel for the petitioner has submitted that the petitioner is a senior citizen and has been filing regular income tax return. In the instant case, return of income tax was filed on 23.07.2017 for the assessment year 2017-18. The same came in scrutiny and high pitched additions were made vide assessment order dated 28.11.2019. It is submitted that income assessed by Assessing Officer was Rs. 24,04,440/-, which is more than two times the returned income, and a demand of Rs. 12,62,649/- was created. Against the said order, appeal before the Commissioner Of Income Tax (Appeal-1) was preferred on 18.12.2019, within a period of 30 days. After filing appeal, the petitioner suo moto deposited a sum of Rs. 2,52,530/- on 18.12.2019, which was equivalent to 20% of demand created, in terms of Office Memorandum dated 29.02.2016 and 31.07.2017, issued by respondent No. 2. As a matter of precaution, stay application dated 26.12.2019 was also filed by the petitioner, requesting for keeping the demand in abeyance till the disposal of the appeal. 

2. It is further submitted that the Assessing Officer i.e. respondent No. 1, against all canons of law, without disposing the stay application filed by the petitioner, without considering the fact that the petitioner has himself deposited Rs. 2,52,530/- and bypassing the Office Memorandum dated 29.02.2016 and 31.07.2017, initiated coercive recovery on 28.01.2020 and recovered entire amount of Rs. 12,62,650/- from the bank account of the petitioner in a exparte manner. 

3. In this background, present writ petition was filed against the adversarial and illegal approach of the respondents contrary to their own circulars and provisions of law and against orders passed by Hon’ble Supreme Court and Hon’ble Jurisdictional High Court and other Hon’ble High Court’s. 

4. Per contra, learned Standing Counsel, Mr. Anuroop Singhi, submitted that the amount of Rs 2,52,530, equivalent to 20% of additional demand, which was deposited by the petitioner on 18.12.2019 was already refunded to him vide rectification order (u/s 154 r.w.s 144 of the I.T. Act, 1961) dated 01.06.2020, after the recovery of entire amount of Rs. 12,62,650 from the petitioner, which was done on 28.01.2020. On the date of hearing, however, learned counsel for the respondent fairly conceded that recovery of over 20% of demand, before disposal of appeal is not appropriate. He was further unable to refute the narration and positions submitted by counsel for the petitioner. He fairly conceded that petitioner is entitled to refund of amount in excess of 20% of the total demand which was recovered from him. 

5. In this background, relying upon the Office Memorandum dated 29.02.2016 & 31.07.2017, considering Section 220(6) of theT. Act, 1961, considering the fair admission on part of Standing Counsel, and considering the fact that the amount of Rs 2,52,531, equivalent to 20% of the demand, was already refunded by department on 01.06.2020, this court deems it appropriate to direct the respondent to refund the excess amount of Rs 10,10,119, being 80% of the demand that is already recovered from the petitioner. The respondents are entitled to keep 20% of the demand, i.e. Rs 2,52,530 in terms of Office Memorandum dated 29.02.2016 and 31.07.2017, until the appeal of petitioner pending before Commissioner Of Income Tax (Appeal-1) is decided. The refund of Rs. 10,10,119 be made to the petitioner within a period of 30 days from the pronouncement of this judgment, failing which respondent will be liable to pay interest as applicable. Upon delay of the payment, interest as applicable will be recovered from the erring officer/respondent. 

6. In light of the above, the writ petition is disposed off. 

All pending applications also stand disposed off.

International Taxation : No TDS deductible on business profit of non-resident in absence of Permanent Establishment in India

Posted on by Business So Simple in Court Room, Income Tax, International Taxation, Legal awareness

Case Reference :

Apurva Goswami Vs DDIT (International Taxation) (ITAT Delhi) dated 24/05/2022

Facts in brief :

From 15CA/CB certificates filed by the assessee, the Ld. AO noted that the assessee has remitted amounts to various parties outside India without deducting tax at source. It was pointed out that the Global Business Affiliates (GBA), as per the terms and conditions of the agreement were entitled to fixed compensation and further additional commission on orders procured for the assessee. It was further stated that the nature of services as rendered by non resident agent who is carrying out business activities in other contracting state falls squarely within the scope of Article 7 of DTAA. As per Article 7 the profits of an enterprise of other State would be taxable in India if there was a PE of such enterprise in India. The explanation of the assessee was not acceptable to the ld. AO. According to him the impugned payments were made to the consultant which are covered under section 9(1)(vii) and not to the agent as claimed. The assesee was liable to deduct tax at source from fee paid for consultancy services.

Conclusion of the case :

Held that the payments made to the GBAs/ BDAs are not FTS but business profits not taxable in the hands of GBAs/BDAs in India in the absence of PE by virtue of the Article 7 of the DTAA, no tax is required to be deducted at source on such payments. In the case of GE India Technology Centre Pvt. Ltd. vs. CIT (2010-TMI-77380-SC) the Hon’ble Supreme Court held that obligation under section 195(1) to withhold tax arrives only if the payment is chargeable to tax in the hands of non-resident recipient. Therefore, merely because a person has not deducted tax at source from a remittance abroad, it cannot be inferred that the person making a remittance has committed a failure in discharging his tax withholding obligations because such obligations come into existence only when recipient has a tax liability in India. Thus, the payments made to the GBAs/ BDAs are not subject to any withholding tax, such payments being not chargeable to tax in India.

Faceless Penalty Scheme (CBDT Notification dated 27 May 2022)

Posted on by Business So Simple in Income Tax, News Desk

CBDT Notification No. 54/2022/F. No. 370142/51/2020-TPL(Part III) dated 27 May 2022

S.O. 2425(E).— In exercise of the powers conferred by sub-section (2A) of section 274 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby makes the following Scheme to amend the Faceless Penalty Scheme, 2021, namely:__

CBDT Notification No. 55/2022/F. No. 370142/51/2020-TPL(Part III) dated 27 May 2022:

S.O. 2426(E).—In exercise of the powers conferred by sub-section (2B) of section 274 of the Income-tax Act, 1961 (43 of 1961)(hereinafter referred to as ―the Act‖) and in consequence to the amendments made in section 144B of the Act vide the Finance Act, 2022, for the purposes of giving effect to the Faceless Penalty (Amendment) Scheme, 2022 made under sub-section (2A) of section 274 of the Act, the Central Government hereby makes the following amendments in the notification of the Government of India, Ministry of Finance (Department of Revenue), Central Board of Direct Taxes published in the Gazette of India, Extraordinary vide number S.O. 118(E), dated the 12th January, 2021, namely:

Super 10 Tax Saving Tips

Posted on by Business So Simple in Income Tax

Dear Sir,

Please find below YouTube video link on *Super 10 Tax Saving Tips*

https://youtu.be/DpCXOuDG7Io


*Super 10 Tax Saving Tips*

✒️ *Paying rent to parents*

✒️ *Invest in wife’s name*

✒️ *Investment through HUF*

✒️ *Utilise exemption for senior citizens*

✒️ *Invest in name of adult child*

✒️ *Invest in NPS*

✒️ *Tax Harvesting*

✒️ *Car Hire*

✒️ *Accommodation lease*

✒️ *Save tax of Rs. 12,500 by small donation 80G/80GGA (For Small taxpayer, Taxable income above 5 Lakhs to 5.125 Lakhs )*


Regards,
Bipul Kumar