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Feb 23, 2024

  • ITR-U Enabled on Income Tax Portal for AY 2023-2024 The Income Tax Department has taken a significant step towards digital convenience by introducing e-filing options for ITR-U on the Income Tax Portal. This development applies to the Assessment Year 2023-2024, corresponding to the Financial Year 2022-2023. Taxpayers can now easily file their returns online, streamlining the process and enhancing accessibility for a hassle-free tax season.
  • IT dept sends advisory to taxpayers over mismatch in ITR, TDS/TCS deductions Regarding mismatch in TDS/TCS deductions and ITR filing data, the department said such communication is sent to facilitate the taxpayers and make them aware of the information available with the I-T department regarding the transactions reported by the Reporting Entities during the year. Such communication also highlights to the return filer to rectify intentional or unintentional mismatch. Taxpayers are requested to respond to the communication on priority.
  • CBDT Notifies ITR-1, ITR-4 forms for AY 2024-25 CBDT has notified two new return forms, ITR-1 (SAHAJ) and ITR-4(SUGAM), for the AY 2024-25. These forms will come into effect from April 1, 2024. ITR-1(SAHAJ) is to be used by individuals with a total income upto 50 lakhs, having income from salaries, one house property and other sources (like interest) and agriculture income up to Rs.5000.
    Budget 2023 has made the new tax regime as the default tax regime. Hence, unless an individual specifically opts out of the new tax regime, the online ITR form will automatically calculate the taxes using the income tax slabs of the new tax regime. The new tax regime disallows common deductions and tax exemptions such as HRA tax exemption, LTA tax exemption, Section 80C, 80D etc. However, standard deduction of Rs 50,000 from salary income and deduction claimed under Section 80CCD (2) of the Income-tax Act is available under the new tax regime from FY 2023-24 (AY 2024-25). Section 80CCD (2) deduction is also available under the new tax regime on the employer’s contribution to the National Pension System (NPS).
    On the other hand ITR-4 (SUGAM) is applicable to individuals, HUFs and firms (other than LLPs) with the total income up to Rs.50 Lakh and income from business and professional computed under Section 44AD, 44ADA or 44AE. Those who are eligible to file for ITR-4 will also have to opt out of new tax regime in case they don’t want it, as the new tax regime will be the default regime in the ITR. The resident tax payers, whether they are Indian or Foreign citizens, are bound to disclose beneficial interest in foreign assets, foreign bank accounts, foreign trust and similar details as prescribed.
  • CBDT Redefining Intra-Group Loan & outlines its ‘Safe Harbour’ transfer Pricing conditions The Central Board of Direct Taxes (CBDT) has recently amended the Safe Harbour Rules for international transactions vide notification. These latest amendments are with respect to the definition of operating expense and operating revenue and the scope of intra-group loan transactions that will be covered within the ambit of the Safe Harbour Rules. The amendments will come into force from 1 April 2024. Safe harbour rules for intra-group transactions prescribe the minimum price or return for specific categories of transactions which, if opted by the taxpayer, is accepted as it is by the tax authorities.
  • Centre notifies creation of principal bench of GST Appellate Tribunal
    Centre Government has notified the creation of the principal bench of Goods and Services Tax Appellate Tribunal (GSTAT).
  • Overseas staff on deputation: CBIC alert over GST notices:
    Central Board of Indirect Taxes and Customs (CBIC) has issued instructions urging officers to exercise caution in raising demands in secondment cases. The Supreme Court’s ruling in the Northern Operating Systems case determined that secondment of employees by overseas group companies a taxable service of ‘manpower supply,’ making Service Tax applicable. The CBIC emphasized that the Supreme Court ruling in the Northern Operating Systems case should not be applied mechanically and instructed officials to invoke Section 74(1) of the GST Act only in cases involving genuine fraud or evasion of taxes.
    Editor’s comment: It is important that the overseas group employees are deputed to India by appointing them on the role of Indian Company and making all payments from Indian company about salary and Perks. GST as well as transfer pricing and PE taxation issues in India can be professionally planned.
  • PMLA accused Corporate to given copy of grounds of detention within 24 hours
    In the opinion of Supreme court, in case a person is arrested, if he is informed or made aware orally about the grounds of arrest at the time his arrest and is furnished a written communication about the grounds of arrest as soon as may be i.e.as early as possible and within reasonably convenient and requisite time of 24 hours of his arrest, that would be sufficient compliance of not only section 19 of the PMLA but also of Article 22(1).
  • RBI takes steps to curb fraud and guidelines in respect of inoperative bank accounts
    Reserve Bank of India (RBI) has issued comprehensive guidelines effective from Apr.01, 2024 on the measures to be implemented by the banks covering various aspects of how to classify deposits and accounts as unclaimed deposits and inoperative accounts, respectively, periodic review of such deposits and accounts, fraud prevention measures such as tracing the customers of unclaimed deposits and inoperative accounts, including their nominees/legal heirs for account reactivation, interest or charges on inoperative accounts settlement of claims or closure to be followed. The guidelines also mandate the transfer of credit balances in accounts untouched for 10 years or more to the Depositor Education and Awareness (DEA) Fund maintained by the RBI.
  • RBI seeks to audit SROs for regulated entities The Reserve Bank of India announced draft omnibus norms for setting up self-regulatory organisations (SROs) by its regulated entities and in those it has proposed to audit the books of such institutions. The framework prescribes the broad objectives, functions, eligibility criteria, and governance standards, which will be common for all SROs irrespective of sectors they belong to. Reserve Bank may inspect the books of the SRO or arrange to have the books inspected by an audit firm.
  • SEBI notifies the revised framework for computation of Net Distributable Cash Flow by REITs and INVITs In order to promote ease of doing business, the SEBI has decided to standardize the framework for calculation of available Net Distributable Cash Flows (NDCF). Under the rules applicable from April 1, 2024, the Net Distributable Cash Flow (NDCF) is computed at the level of real estate investment trusts (REITs), and infrastructure investment trusts and their holding companies (HoldCo) or special purpose vehicles (SPVs). Further, the minimum distribution should be 90 per cent of the NDFC at the Trust level as well as the HoldCo/SPV level, subject to applicable provisions in the Companies Act or the Limited Liability Partnership Act. Option to retain 10 per cent distribution needs to be computed by taking together the retention done at SPV level and Trust level. Further, Trust along with its SPVs needs to ensure that minimum 90 per cent distribution of NDCF be met for a given financial year on a cumulative periodic basis. Similarly, any restricted cash should not be considered for NDCF computation by the SPV or InvIT.
  • NFRA finds certain lapses in audit quality of network entities of Big 4 The National Financial Reporting Authority (NFRA) has disclosed a series of deficiencies in the auditing-related activities of ‘Big 4’ – Deloitte, Haskins & Sells LLP, BSR & Co LLP, SRBC & Co LLP, and Price Waterhouse Chartered Accountants LLP during detailed audit quality inspections, initiated in December of the previous year. The inspections covered various aspects, including review of firm-wide quality controls and selected audit documentation of annual financial statements for the year ended Mar.30, 2021, according to four reports released by NFRA .