Dipika C Soni & Associates

*Income Tax Update*
नियम 12 AB के अनुसार अब निम्न व्यक्तियों को ITR भरना अनिवार्य होगा।
- यदि सकल बिक्री, टर्नओवर या व्यापार से प्राप्तियां 60 लाख से अधिक है।
- यदि प्रोफेशन से सकल प्राप्तियां 10 लाख से अधिक है।
- यदि कुल TDS/ TCS 25000/- (Senior Citizen Rs. 50000) से अधिक है।
- यदि वर्ष में एक या अधिक बचत खातों में 50 लाख से अधिक जमा कराया गया है I

CBDT has vide Circular No. 13 of 2021 dated 30/06/2021 issued clarification on section 194Q and interplay of Section 194Q, 206C(1H) AND 194O.

1. TDS on Amount Excluding GST
TDS under section 194Q should be deducted exclusive of GST, if charged separately. However for TCS on sale of goods - section 206C(1H), GST is to be included.
In case, tax is deducted on advance payment or on paid basis, tax has to be withheld on the amount including Gst since at that point of time, it is not possible to segregate the Gst from invoice for goods.

2. Purchase Return
In case of purchase return where TDS u/s. 194Q was done at the time of purchase, TDS deduction is allowed to be adjusted against future supply of goods by the same seller. In case the goods are replaced by the seller for the same value, there is no need of any further adjustment.

3. Computation of Turnover limit
Turnover/ Gross receipts of 10 crore of buyer for applicability of this section 194Q will mean Turnover/ Gross receipts in business only/ from business carried on by him. Hence, receipts by way of rent, interest, capital gain etc if not considered as business income, are not to be included in calculating the threshold of Rs.10 crores.

4. Cut off Transactions

TDS liability u/s. 194Q is either on payment or credit whichever is earlier. Therefore, if either of two events happened before 1st July, 2021, that transaction would not be subjected to provisions of Sec. 194Q of the Act.

5. No TDS if tax already collected by seller u/s. 206C(1H)
If tax has been collected by the seller under sub-section (I H) of section 206C of the Act, before the buyer could deduct tax under section 194-Q of the Act on the same transaction, such transaction would not be subjected to tax deduction again by the buyer.

6. Not Apply in First year of incorporation
The provision of Section 194Q shall not to apply in first year of an entity, as there is no turnover / gross receipts in the preceding year since the entity wasn't in exist

Major changes

1. Rule 36(4) amended to allow credit only upto additional 5% of amount in GSTR-2A (earlier 10%)

2. Rule 86B introduced which mandates min 1% cash payment through cash ledger if value of supply in a month exceeds 50lakhs.

Honeymoon of tax payers with GST Return filing is over- Govt tightens control in GST law by notifying several changes

1 . GST Regn cancellation when ITC exceeds permissible limit under Section 16 .
Now the officer can proceed for cancellation of GSTIN where a taxpayer avails Input Tax Credit (ITC) exceeding than that permissible in Section 16. Clause (e) has been inserted in Rule 21 of CGST Rules 2017.

2. Now where the liability declared in GSTR 3B is less than GSTR1 the registration can be cancelled.
3. Now, no opportunity of being heard shall be given to a taxpayer for suspension of GSTIN, where the proper officer (PO) has reasons to believe that the registration of person is liable to be cancelled. The words “opportunity of being heard has been omitted from clause (2) of Rule 21A.

4. Where there are significant deviation/anomalies between details of outward supply between GSTR 3B and GSTR1 or inward supplies (ITC) between GSTR 3B and GSTR 2B which indicate contravention of Act, department shall now serve a notice in FORM GST REG 31 to call explanation as to why GSTIN should not be cancelled. Taxpayer shall be required to submit his reply within 30 days of such notice being served to him.
Where a GSTIN is suspended no refund u/s 54 of CGST Act 2017 can be availed by the taxpayer. This means that first GSTIN Suspension proceedings have to be closed before applying refund.

5. Restriction on claim of ITC as per Rule 36(4)*
The claim of ITC in respect of invoices not furnished by the corresponding vendors has now been restricted to 5% of the credit available in GSTR 2B. This limit earlier was 10% of ITC available. This would be mean that a taxpayer’s ITC claim shall now be restricted to 105% of the Credit reflected in his GSTR 2B. Any claim exceeding the specified limit shall result in violation of CGST Act read with rules which may result into suspension of GSTIN as described above. The provision shall come into effect from 1st January 2021.

6. GSTR 1 to be blocked in case of non-filing of GSTR 3B*
Where a taxpayer fails to file GSTR 3B for two subsequent months, his GSTR 1 shall now be blocked. Earlier non filing of GSTR 3B used to result in blocking of E-way Bill facility but from now on it shall also result in blocking of GSTR 1 of the taxpayer. Similarly, for quarterly return filers, the taxpayer failing to file GSTR 3B for the preceding quarter shall not be permitted to file GSTR 1 of subsequent quarter.
A taxpayer who is restricted to avail ITC as per rule 86B shall also not be permitted to file GSTR 1 where he has not filed GSTR 3b for the preceding tax period.

7. Restriction on Utilization of Input Tax Credit – Rule 86B*
New Rule 86B shall be affected from 1st January 2021 wherein restriction has been placed on paying over and above 99% of tax liability from Input tax credit where the value of taxable supplies other than exempt supply and zero rated supply exceeds Rs. 50 lakhs in a month. Though few exceptions have been provided to this rule which are as follows:
(i) Where the taxpayer has paid Income Tax exceeding Rs. 1 lakh in two preceding financial year.
(ii) Where taxpayer has received refund exceeding Rs. 1 lakhs u/s 54 of CGST Act 2017.
(iii) Where taxpayer has used electronic cash ledger to pay of liability on outward supplies which cumulatively makes 1% of the total liability up to the said month

8. validity of Eway bil
Earlier one day was permitted for distance up to 100 kms under e way bill provision. Now the same has been increased to 200 kms. This means that only one day validity shall be granted to cover a distance up to 200 kms which was earlier 100 kms.

New Education Policy 2020

1. 10+2 board structure is dropped
2. New school structure will be 5+3+3+4
3. Upto 5 pre school, 6 to 8 Mid School, 8 to 11 High School , 12 onwards Graduation
4. Any Degree will be 4 years
5. 6th std onwards vocational courses available
6. From 8th to 11 students can choose subjects
7. All graduation course will have major and minor
Example - science student can have Physics as Major and Music as minor also.
Any combination he can choose
8. All higher education will be governed by only one authority.
9. UGC AICTE will be merged.
10. All University government, private, Open, Deemed, Vocational etc will have same grading and other rules.
11. New Teacher Training board will be setup for all kinds of teachers in country, no state can change
12. Same level of Accreditation to any college , based on its rating collage will get autonomous rights and funds.
13. New Basic learning program will be created by government for parents to teach children upto 3 years in home and for pre school 3 to 6
14. Multiple entry and exit from any course
15. Credit system for graduation for each year student will get some credits which he can utilize if he takes break in course and come back again to complete course
16. All schools exams will be semester wise twice a year
17. The syllabus will be reduced to core knowledge of any subject only
18. More focus on student's practical and application knowledge
19. For any graduation course if student completes only one year, he will get a basic certificate, if he complete two years then he will get Diploma certificate and if he complete full course then he will get degree certificate.
So no year of any student will be wasted, if he breaks the course in between.
20.All the graduation course feed of all Universities will be govern by single authority with capping on each course.

Now we can hope our education system will be at par with modern countries and future of our children will be bright.

In view of the constraints due to the COVID 19 pandemic and to further ease of compliances for tax payers, CBDT extends the due date for filing of Income Tax Returns for FY 2018-19 i.e. AY 2019-20 from 31st July 2020 to 30th September 2020.

GST Update:-

Notification No. 59/2020- Central Tax.

The last date to furnish GSTR- 4 for the year ending 31st March 2020 has been extended to 31st August 2020 from 15th July 2020.