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News Indirect Tax-Misc. - Indirect Tax

  • Jan 27, 2020
  • Sabka Vishwas tax scheme ends with flying colours; now do this to ensure people pay tax

    Phew! the deluge has finally abated! As we assess the impact of the Sabka Vishwas Legacy Dispute Resolution Scheme (SVLDRS- 2019) which finally ended at the stroke of the midnight hour on the 15th of January, 2020, there is only one unanimous verdict – it has turned out to be one gigantic winner. A total of 1,89,229 declarations filed, coupled with a handsome revenue of Rs 14821 crores (almost 2 billion dollars) for the cash-starved government exchequer. The figures speak for themselves!

    It would be a grave injustice to the scheme, if it’s success were to be measured solely on the basis of figures reported. A more rational evaluation would be to judge it vis-a-vis the expectations with which it was launched on the 1st of September, 2019. As per records, the number of potential declarations was estimated to be about 1,82,000 & with the actual number topping the expectations by a wide margin, the results have come as a pleasant surprise. On the revenue side, the figure of Rs 14821 crores may look piffling, but with the scheme granting a mammoth and truly unprecedented waiver of as much as 70% of tax dues, any expectations of windfall revenues were anyway fanciful.

  • Jan 10, 2020
  • Sabka Vishwas Tax Amnesty Scheme: Big taxpayers stick to legal fight

    Taxpayers with deep pockets seem to have weighed the two options of resolving their indirect tax disputes with the government under the Sabka Vishwas scheme and getting legal remedy, only to mostly choose the latter route. Why else even after nearly 90% of the eligible taxpayers opted for Sabka Vishwas, cases related to only a fifth of the total disputed amount of Rs 3.6 lakh crore have been resolved yet? As reported by FE earlier, the scheme’s original deadline was December 31 but it was later extended to January 15. Over 87% of 1.8 lakh eligible taxpayers applied for the leniency scheme by Monday, according to officials. The government had earlier said 1.6 lakh taxpayers committed to pay Rs 35,094 crore of Rs 79,968 crore claimed by the taxman and settled the disputes. It remains to be seen how much of the committed payments will be made in the current fiscal. Government sources say that large taxpayers are steering clear of the scheme because in many cases the tax consultants and lawyers employed by the firms might have found that immediate settlements would not be in the best interests of these intermediaries.

  • Nov 25, 2019
  • Govt plans to scrap e-comm ‘gifts’ to curb China imports

    The government is considering amending its rules to completely remove the provision under which citizens can receive duty-free ‘gifts and samples’ valued at under Rs 5,000 from overseas, after finding its rampant misuse by Chinese ecommerce vendors, senior officials ET spoke to said. The Central Board of Indirect Taxes and Customs (CBITC), which formulates policy concerning levy and collection of customs, was considering a cap on the number of gifts an individual can receive, but has decided against it given the complexity in its implementation. “There were multiple legal options we were looking at, one being limiting the number (of gifts) to four per individual. But to implement this practically would be difficult, so we’re looking at a policy that prohibits the clearance of gifts altogether,” said a senior government official, who spoke on the condition of anonymity.

  • Nov 13, 2019
  • Sabka Vishwas Scheme gaining traction; over Rs 5,000 cr dues declared so far

    More than Rs 5,000 crore worth dues have been declared so far under the government's 'Sabka Vishwas Scheme', which is for settling pending disputes of service tax and central excise. The Central Board of Indirect Taxes and Customs (CBIC) has asked its principal chief commissioners to be more proactive in persuading eligible taxpayers to take benefit of 'Sabka Vishwas Scheme'. Finance Minister Nirmala Sitharaman had unveiled the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 with the objective of settling pending disputes of Service Tax and Central Excise in the budget. A mid-term review reveals that a total amount of Rs 5,472 crore inclusive of pre-deposit amount of Rs 4,225 crore has already been declared under the scheme, sources said. Efforts are being made to maximise declarations by December 31, 2019 when the scheme ends.

  • Nov 12, 2019
  • Lukewarm response to indirect tax legacy dispute resolution scheme

    The legacy dispute resolution scheme for indirect tax taxpayers has seen a tepid response at the half-way point with only a fraction of amount locked in litigation coming forward. Sources said the lack of takers in the first two months (September and October) could be due to preoccupation of businesses with GST and income tax audits. The sources said that Rs. 5,472 crore (inclusive of pre-deposit amount of Rs. 4,225 crore) had been declared under the scheme, so far. This contrasts with nearly Rs. 3.6 lakh crore stuck in legal battles pertaining to various quasi-judicial, appellate and judicial forums under service tax and central excise put together. This has prompted the Central Board of Indirect Taxes and Customs (CBIC) to ask its zonal heads to proactively reach out to 1.8 lakh taxpayers.

  • Nov 08, 2019
  • CBIC to communicate with taxpayers using document identification number

    The indirect tax department (CBIC) will quote a computer-generated document identification number (DIN) for its communications with taxpayers starting Friday. The system, which is expected to bring transparency and shield taxpayers from harassment, has already been implemented by the direct tax department.

  • Jul 24, 2019
  • Pendency of indirect tax appeal cases down 61% in 2 years: MoS Finance Anurag Thakur

    The pendency of appeal cases related to indirect taxes in the Supreme Court, High Court and CESTAT has reduced 61 per cent to 1.05 lakh in almost 2 years, Parliament was informed on Tuesday. Minister of State for Finance Anurag Thakur in a written reply to a question in the Rajya Sabha said the total pendency of appeals at the Supreme Court, High Court and CESTAT (Customs Excise and Service Tax Appellate Tribunal) as on June 30, 2017, was 2,73,591, whereas the same has significantly come down to 1,05,756 as on March 31, 2019, a reduction of 61 per cent.

  • Jul 24, 2019
  • FM rules out rollback of duty on newsprint, says move to give domestic industry level playing field

    Rejecting demands for rollback of import duty on the paper used for printing newspapers, Finance Minister Nirmala Sitharaman on Tuesday said 10 per cent customs duty on imported newsprint was a move to provide a level playing field for domestic manufacturers. Replying to the debate on Finance Bill 2019, which contained the tax proposal, in the Rajya Sabha, she said domestic newsprint manufacturers were finding it difficult to find buyers because the same was being imported.

  • Jun 17, 2019
  • Suspect DeMo cash deposits again come under scanner

    The Narendra Modi government has renewed its efforts to detect tax evasion that may have taken place during demonetisation. In a fresh advisory to Income Tax officers, the Central Board of Direct Taxes (CBDT) has said that even banks and borrowers of a taxpayer could be called to explain suspicious cash deposits or lending.The advisory, which is in the form of a guidance note, has even asked the officers to examine if the deposited cash was declared as streedhan, a gift given to the woman in a Hindu marriage. It is not classified as dowry.

  • Mar 30, 2019
  • Facebook, WhatsApp, other social media sites face Rs 5 crore penalty for data breach

    The ministry of electronics and IT (MeitY) has proposed a stiff penalty of Rs 5 crore on IT platforms, including social media sites like Facebook, WhatsApp and Twitter, for failing to comply with rules and regulations under the Information Technology (IT) Act, 2000. The ministry has already moved a note to the Union Cabinet for amending Section 45 of the Act. Section 45 of the IT Act provides for residuary penalty. It mandates that whoever contravenes any rules or regulations made under this Act, for the contravention of which no penalty has been separately provided, shall be liable to pay a compensation not exceeding Rs 25,000 to the person affected by such contravention or a penalty not exceeding the same amount.

  • Mar 30, 2019
  • Assessing Officer can suo moto extend time period for special audit retrospectively: SC

    The Supreme Court has held that the Assessing Officer can suo moto extend the time period for a special audit retrospectively, even before the amendment in the Finance Act of 2008. The judgment, which lays to rest a long controversy, relates to Section 142 (2C) of the Income Tax Act, which deals with special audit and empowers the AO to direct the assessee to get the accounts audited by an accountant in some cases due to complexity and to protect the department’s interests.

  • Mar 29, 2019
  • Exporters under the scanner for claiming tax benefits twice

    Many exporters have come under the taxman’s lens for claiming tax credit for the same export twice under the inverted duty structure. Those who have received notices from the indirect tax department said they had merely claimed what was theirs — although in two tranches. According to the notices, the anomaly came to light during an audit conducted by the tax authorities. The tax department claimed that these exporters had claimed double benefits.

  • Jan 21, 2019
  • CBDT asks tax officials to speed up withdrawal of appeals cases

    Apex direct taxes body, the Central Board of Direct Taxes, has cracked down on the delay in withdrawal of tax litigations in Income Tax Appellate Tribunal and High Courts and asked officials to expedite the process. The board has shot off a letter to field officers, asking them to complete the exercise by January end. “The entire exercise of withdrawal of appeals must conclude by January end,” Neena Kumar, member of CBDT, said in a letter sent to principal commissioners all over the country.

  • Jan 07, 2019
  • Central Board of Direct Taxes wants income tax department to step up collection efforts

    With growth in direct tax collections sluggish, the CBDT has directed income tax department officials to “maximise” their efforts and conduct targeted surveys and file court cases against those who wilfully evade taxes. CBDT Chairman Sushil Chandra has shot off a letter to all Principal Chief Commissioners of I-T Department, asking them to pull up their socks as only three months are left for the current financial year to close on March 31. “On review of the trends of growth under different minor heads, it is noted that the growth in collection under regular assessment tax (recovery from arrear and current demand) is extremely low at 1.1 per cent as compared to 15.6 per cent growth during the corresponding period last year.

  • Jan 07, 2019
  • CBDT withdraws circular on share valuation after Cong claims ‘win’

    Days after issuing a circular that sought to clarify taxes on valuations, the Central Board of Direct Taxes (CBDT) withdrew it following a Congress party press conference at which it said the move would exonerate Rahul and Sonia Gandhi over income-tax liabilities in the Associated Journals Ltd (AJL) case. The withdrawal means that the taxman will again start challenging valuations in cases where there was a fresh issuance of shares.

  • Jan 07, 2019
  • Anti-abuse provisions: Deft handling by CBDT needed, say tax experts

    Now that the CBDT’s move to withdraw its December 31 circular has created a furore in political circles, time is ripe for the Revenue Department to revisit the scope and intent of Section 56(2) (viia) or 56(2)(viib) of the Income Tax Act 1961— the deeming income provision which sought to curb abusive transactions related to valuation, say tax experts.

  • Jan 05, 2019
  • Government mops up Rs 6.12 lakh crore indirect taxes in April-November, target for FY'19 at Rs 11.16 lakh crore

    The government is targeting to mop up Rs 11.16 lakh crore as indirect tax collection from levy of Central and Integrated GST and compensation cess in 2018-19, Parliament was informed Friday. During April-November of the ongoing fiscal, the total net indirect tax collection (inclusive of CGST, IGST and GST-Compensation Cess) is Rs 6,12,653.47 crore, Minister of State for Finance Shiv Pratap Shukla said in a written reply in the Lok Sabha.

  • Dec 20, 2018
  • Govt taking steps to stop refunds from bogus claims, says CBDT Chairman Sushil Chandra

    The government is taking steps to stop refunds from bogus investment claimed by taxpayers, Central Board of Direct Taxes (CBDT) Chairman Sushil Chandra said today. The income tax department conducted searches in Bengaluru, Mumbai and some places in Punjab, to find that there was a similar pattern of individuals claiming refunds based on bogus investments or tax benefits under Section 80C of the Income Tax Act.

  • Dec 12, 2018
  • Duty drawback rate increase to boost textile exports from India

    The government’s decision to raise the duty drawback rates will boost textile and apparel exports, experts said. Despite several incentives offered by the government to boost textile and apparel exports, their shipment from India stagnated between $32 billion and $37 billion for over seven years.For the financial year 2017-18, India witnessed textile and apparel exports to the tune of $36.05 billion as against the target of $45 billion. Now, the government has set yet another challenging target of $82 billion by 2021.

  • Aug 16, 2018
  • AAR rules out tax credit for CCD on supplies to SEZs

    The taxman wants to filter away some goods and services tax leeway that Café Coffee Day (CCD) sought to enjoy. The quasi-judicial Authority of Advance Ruling (AAR) has told CCD that the coffee chain cannot claim input tax credit on supplies to special economic zones (SEZ). In a July ruling, it said CCD’s supply to SEZ units (companies inside SEZ) does not qualify as “zero-rated supply” as it is not classified as an authorised SEZ transaction.