MGT-10 is to be certified only by a Company Secretary in Practice
FORM NO. MGT-10
[Pursuant to section 93 of The Companies Act, 2013 and pursuant to rule 13 of The Companies (Management and Administration) Rules, 2014]
Changes in shareholding position of promoters and top ten shareholders
Status of ITR Due Date extension cases Pending before Various HCs
CA Sandeep Kanoi
Status Updated Till 25.09.2014 (2.00 PM)
Chartered Accountants and Trade Associations around the country has filed Public Interest Litigation (PIL) before various high courts for extension of Due date of ITR in line with Tax Audit Report Due date for A.Y. 2014-15.
We are giving below the daily status PILs filed before various High Court :-
I. All India Federation Of Tax Practitioners, Mumbai Vs. Union of India & CBDT ( High Court at Hyderabad for the States of Telangana and Andhra Pradesh) , WP 28159/2014, WP 28672/2014
23.09.2014- Disposed of by the Hon'ble High Court at Hyderabad observing that there is no justification or reason to extend the date for TAR alone and not to extend the date for ITR and accordingly the Union of India and CBDT were directed to consider the contents of the representations of AIFTP for extending the date for filing ITRs in tandem with the date for TAR and dispose of the representations well before the date for filing ITR i.e. 30-09-2014.
II. Rajni Mangaldas Shah V/S Central Board Of Direct Taxes (Gujarat High Court), SCA/12571/2014
All Gujarat Federation of Tax Consultants Vs. CBDT (Gujarat High Court) SCA 12656/ 2014
22.09.2014- Appeal Disposed off in favour of Petitioner and High Court Instructed CBDT to extend due date to File Income Tax Return in Tax Audit Cases for A.Y. 2014-15 to 30.11.2014 but allowed to levy Interest U/s. 234A of the Income Tax Act,1961.
19.09.2014 – Adjourned for further hearing to Monday 22.09.2014.
16.09.2014 – On Request from CBDT Counsel Court Adjourned the matter for final hearing to 19th September 2014.
15.09.2014
1. In this case no hearing been taken place and case been adjourned to 16.09.2014.
2. The Reason for adjournment as per information available with us are 1. Absence of Senior Judge and 2. Non Appointment of any counsel to appear on behalf of CBDT/ UOI.
3. In Gujarat one more appeal been filed by All Gujarat Federation of Tax Consultants.
III. Mahesh Kumar And Company Vs. Union Of India & Anr. – W.P.(C) 5990/2014 (Delhi High Court)
23.09.2014 – Petitioner withdrawn the petition citing that they are not happy with affidavit. Petition dismissed as withdrawn.
22.09.2014- Court Adjourned the matter on request of petitioner to 23.09.2014.
19.09.2014 – case Adjourned to 22.09.2014 – Court Directs CBDT to file affidavit regarding non leviability of Penalty U/s. 271(1)(c) in case assessee revises returns filed on or before 30.09.2014.
18.09.2014- Hourable Judges asked advocate from CBDT regarding the losses in case ITR due date is extended , which he was not able to reply, so the case been adjourned to 19.09.2014.
15.09.2014
1. During Hearing High Court has asked CBDT to file an Affidavit that Income Tax Return Filed without Tax Audit Report will not be defective in cases where Tax Audit is applicable.
2. During Hearing CBDT has opposed the extension of due date of ITR arguing that Government may have to incur loss of Rs. 200/- crore per day if any extension for due date of ITR granted.
3. Case is adjourned to 18th September for Next Hearing.
IV. The Chamber of Tax Consultants & Others Vs. Union of India (Bombay High Court), WRIT PETITION (L)NO.2492 OF 2014
25.09.2014 - Bombay HC passed the order stating that CBDT to consider the representation of the of the Chamber before 30th September 204. Petitioners are entitled for better relief in view of decisions of other High Court if they are more favorable.
24.09.2014- After hearing for nearly three hours court adjourned the matter to 25.09.2014 at 11.00 A.M.
23.09.2014- Case adjourned to 24.09.2014
17.09.2014 – At the request of department counsel hearing is been adjourned to 23.09.2014.
15.09.2014 – Appeal Filed and Listed for First Hearing on 17.09.2014.
V. Raj Tax Consultants Vs UO I And Ors (Rajasthan High Court, Jaipur Bench), Civil Writ No. 9540/2014
24.09.2014 – Court Adjourned the matter to 26.09.2014
23.09.2014- Case adjourned to 24.09.2014
19.09.2014 - Admitted and fixed for Final Hearing on 23.09.2014.
16.09.2014 - Listed for First Hearing on 19.09.2014
CHENNAI, SEPT 25, 2014: THIS is an appeal by revenue against the order of Tribunal reported in 2005-TIOL-515-CESTAT-MAD. Please also see Confiscation of foreign currency : Can redemption be allowed?
USD 55,500 was seized from an individual who died on 3.10.2001. Since there was no RBI clearance for the above foreign exchange it was absolutely confiscated and penalty of Rs five lakhs was imposed.
On appeal by the successor, the Tribunal held that though the currency was required for remittance for technology purposes, it was a fact that the same was not remitted through legal channels nor procured through legal routes and held that USD 25,000 was permissible to be carried by any passenger going abroad during the material time and the absolute confiscation was converted into confiscation with an option to redeem on payment of fine of Rs two lakhs.
Against the above order of Tribunal, revenue is in appeal before the High Court with the following questions of law:
(i) Whether the Tribunal was justified in allowing the redemption of the foreign currency attempted to be exported in violation of the provisions of law?(ii) Whether the Tribunal was justified in reducing the quantum of penalty?
After hearing both sides, the High Court held:
In the present case, the passenger has concealed the currency of 55,500 US dollars and other currencies, attempted to be take it out of India without a special or general permission of the Reserve Bank of India and this is in violation of the Rules. The fact that it was procured from persons other than authorized person as specified under the FEMA, makes the goods liable for confiscation. Therefore, the Original Authority was justified in ordering absolute confiscation of the currency. The key word in Regulation 5 (Foreign Exchange Management - Export and Import of Currency Regulations, 2000) is prohibition of import and export of foreign currency. The exception is that special or general permission should be obtained from the Reserve Bank of India, which the passenger has not obtained and therefore the order of absolute confiscation is justified in respect of goods prohibited for export, namely, foreign currency.
It is of no avail to plead that the foreign currency upto certain limit is permissible. The Tribunal has misguided itself in holding that upto 25,000 USD is permitted to be carried by a passenger while going abroad. This error arose from a misreading of Clause 8 of Schedule III of Foreign Exchange Management (Current Account Transactions) Rules, 2000. Clause 8 of Schedule III speaks about release of foreign exchange, exceeding USD 25,000 to a person irrespective of period of stay, for business travel, or attending a conference or specialized training or for maintenance expenses of a patient going abroad for medical treatment or check-up abroad, or for accompanying as attendant to a patient going abroad for medical treatment/check-up.
Schedule III also come with the rider that prior approval of the Reserve Bank of India should be obtained.
The Tribunal, without adverting to the prohibition imposed under Regulation 5 of the Foreign Exchange Management (Export and Import of Currency) Regulations, 2000 has come to the erroneous conclusion that the amount not exceeding 25,000 USD may be freely taken out of India. If both the Rules and Regulations are properly applied to the facts of the present case, it will be evident that the first respondent - passenger in this case has clearly violated the provisions of the FEMA, more particularly Regulation 5 of the Foreign Exchange Management (Export and Import of Currency) Regulations, 2000 read with Section 113 of the Customs Act. Therefore, the Tribunal fell into error by setting aside the order of absolute confiscation.
Accordingly, the High Court answered the first question of law in favour of revenue.
However, with regard to penalty, the High Court after taking note of the fact that the respondent had died and the appeal was pursued by his wife, declined to interfere with the reduction of penalty by the Tribunal.
Whether when assessee is born out of restructuring of Electricity Board, expenditure incurred on IT support to LAN, upgradation of bandwidth and for coordination with BSNL for better connectivity is to be treated as capital in nature - NO: High Court
THE assessee company is engaged in the business of generation, transmission and distribution of electricity in the State of Gujarat. The erstwhile Gujarat Electricity Board in a process of restructuring was demerged into seven different companies. Gujarat UrjaVikas Limited [GUVNL] was assigned the function of bulk purchase and sale of power. The return of income filed by the assessee for the A.Y 200607 declaring Nil income and the book profit was shown which was revised later on account of some error in computation and the same was reduced. Return was processed under Section 143 (1) but later scrutinized. In scrutiny assessment, income and book profit under Section 115JB of the Act was computed. The Assessing Officer was of the opinion that an expenditure claimed under "Legal & Professional Fees" pertained to re-organization of the business of erstwhile Gujarat Electricity Board by way of demerger and also included expenditure pertaining to issue of allotment of shares; expenditure pertaining to Internet Bandwidth, supply and installation of software, legal and professional fees in respect of restructuring, etc. These expenses according to the Assessing Officer were not the business expenditures, but, were capital in nature, hence were disallowed.
The issue before the Bench is - Whether when assessee is born out of restructuring of an Electricity Board, the expenditure incurred on IT support to LAN, upgradation of bandwidth and for coordination with BSNL for better connectivity is to be treated as capital in nature. And the answer goes against the Revenue.
TDS not deductible on payment to non-resident translator
M/s Cosmic Global Ltd. Vs. ACIT (ITAT Chennai), ITA No. 744/Mds/2014, Date of Pronouncement: 30th July, 2014
Facts :- The Assessing Officer has made disallowance of Rs. 2.63 Crores under Section 40(a)(i) on account of non-deduction of tax at source on the payments made to nonresident translators. The authorities below have held translation services to be technical in nature. On the other hand, the contention of the assessee is that the payment for translation services to non-residents does not fall within the ambit of "fees for technical, managerial or consultancy services".
Held - In the present case, the assessee is getting the translation of the text from one language to another. The only requirement for translation from one language to other is, the proficiency of the translators in both the languages, i.e. the language from which the text is to be translated, to the language in which it is to be translated. The translator is not contribution anything more to the text which is to be translated. He is not supposed to explain or elaborate the meaning of the text. Apart from the knowledge of the language, the translator is not expected to have the knowledge of applied science or the craft or the techniques in respect of the text which is to be translated. A bare perusal of Explanation 2 to Section 9(1)(vii), which explains "fees for technical service" and the dictionary meaning of the word "technical" makes it unambiguously clear that translation services rendered by the assessee are not technical services. Therefore, the payment made by the assessee to the non-resident translators would not fall within the scope of "fees for technical, managerial or consultancy service" as detailed in Explanation 2. In our considered view, the CIT(Appeals) has travelled beyond the definition of "fees for technical service" to bring the translation services within the compass of the term "fees for technical services".
In our considered opinion, the payments made by the assessee to non-residents on account of translation services do not attract the provisions of Section 194J. The disallowance made under Section 40(a)(i) is thus deleted. This ground of appeal of the assessee is allowed.
HC follows SC's ruling in Savdik's case; directs revenue to pay compensation if payment of interest was delayed
IT : If tax, interest, penalty, etc., has been collected in excess and it is withheld beyond permissible period under Act, Revenue should compensate for same
Donation by one charitable trust to other charitable trust amounts to application of income
IT : In order to obtain approval under section 80G(5), donation made by a charitable trust to other charitable trusts/institutions amounts to application of income within meaning of section 11(1)(a)
Bombay HC ask CBDT to Consider Extension of ITR due Date to 30.11.2014
Following the Footsteps of other High Courts Bombay High Court today held in the case of 'The Chamber of Tax Consultants & Others Vs. Union of India (Bombay High Court), WRIT PETITION (L) NO.2492 OF 2014′ that CBDT should consider the representation of the of the Chamber of Tax Consultants on or before 30th September 204. Petitioners are entitled for better relief in view of decisions of other High Court if they are more favorable.
The petition was filed by the chamber of Chamber of Tax Consultants & Others for non extension of due date of ITR to 30.11.2014 in accrdance with due date of Tax Audit report. CBDT has already extended due date of Tax Audit Report to 30.11.2014. Petitioners has urged the court to issue a direction to the CBDT to extend due date of Income Tax Return to 30.11.2014 for A.Y. 2014-15 in cases where tax audit is applicable.
MUMBAI, SEPT 25, 2014: THE issue before the Bench is - Whether interest paid to sister concern can be disallowed on the ground that the assessee has not paid interest to any other parties from whom it had taken advances and further the said interest was not reflected in the Tax Audit report u/s. 44AB. NO is the answer.
Facts of the case
The assessee is a reality developer. The assessee has paid interest of Rs.63,45,627 to its sister concern being specified person u/s. 40A(2)(b). Interest was paid @ 12% per annum. The assessee has not paid interest on similar advances. The assessee was having unsecured loans of Rs.7,66,79,452/- on which also the assessee has not paid any interest. The assessee has made interest free advances to various parties amounting to Rs.17,55,87,523/-.The AO who was of the opinion that the assessee has not paid interest to any parties from whom he has taken advances and further the said interest was not reflected in the Tax Audit report u/s. 44AB. The AO accordingly disallowed interest of Rs.63,45,627/- paid to sister concern being specified person u/s. 40A(2)(b) .The CIT(A) was of the opinion that the interest paid by the assessee to its sister concern was not in the nature of an expenditure incurred in respect of some offence or which is prohibited by law. Therefore, Explanation to Sec. 37(1) does not apply. The CIT(A) further observed that non-mentioning of the payment in Tax Audit Report u/s. 44AB cannot by itself allow the AO to make the addition. The CIT(A) observed that the comparison by the AO of not paying interest on other advances is uncalled for.
The AO found that the assessee has not deducted TDS on the payment made in respect to Development expenses. Invoking provisions of Sec.40(a)(ia), the AO disallowed the sum of Rs.71,90,199/-. The CIT(A) observed that once the labour charges have been incurred by the purchaser party and TDS was duly deducted by that party out of such labour payment, the assessee was not required to deduct tax at the time of reimbursing such payment to the purchaser party and deleted the addition.
Having heard the parties, the Tribunal held that,
++ the reasons given by the AO for disallowing the interest are not tenable in law. The assessee has been paying interest since 1999-2000 by making TDS as per provisions of law. The said interest has been allowed in all the preceding A.Y. The recipient is declaring the interest income in its return of income. The CIT(A) has very rightly declined to invoke Explanation to Sec. 37(1) in respect of this payment of interest. No interference is called for with the findings of the CIT(A);
++ on the issue of payment made in respect to Development expenses, it is an undisputed fact that the assessee has simply reimbursed the expenditure incurred, on such reimbursement of expenditure, there is no liability for TDS;
++ on the issue of payments received as advances from sister concern, the assessee is directed to furnish the share holding pattern in the related companies during the year under consideration. The AO is directed to verify whether the assessee is a share holder of M/s. Gazebo Industries Ltd. or whether the assessee has any substantial interest in any concern which has a substantial interest in M/s. Gazebo Industries Ltd. and decide this issue afresh as per provisions of law.
The assessee is a reality developer. The assessee has paid interest of Rs.63,45,627 to its sister concern being specified person u/s. 40A(2)(b). Interest was paid @ 12% per annum. The assessee has not paid interest on similar advances. The assessee was having unsecured loans of Rs.7,66,79,452/- on which also the assessee has not paid any interest. The assessee has made interest free advances to various parties amounting to Rs.17,55,87,523/-.The AO who was of the opinion that the assessee has not paid interest to any parties from whom he has taken advances and further the said interest was not reflected in the Tax Audit report u/s. 44AB. The AO accordingly disallowed interest of Rs.63,45,627/- paid to sister concern being specified person u/s. 40A(2)(b) .The CIT(A) was of the opinion that the interest paid by the assessee to its sister concern was not in the nature of an expenditure incurred in respect of some offence or which is prohibited by law. Therefore, Explanation to Sec. 37(1) does not apply. The CIT(A) further observed that non-mentioning of the payment in Tax Audit Report u/s. 44AB cannot by itself allow the AO to make the addition. The CIT(A) observed that the comparison by the AO of not paying interest on other advances is uncalled for.
The AO found that the assessee has not deducted TDS on the payment made in respect to Development expenses. Invoking provisions of Sec.40(a)(ia), the AO disallowed the sum of Rs.71,90,199/-. The CIT(A) observed that once the labour charges have been incurred by the purchaser party and TDS was duly deducted by that party out of such labour payment, the assessee was not required to deduct tax at the time of reimbursing such payment to the purchaser party and deleted the addition.
Having heard the parties, the Tribunal held that,
++ the reasons given by the AO for disallowing the interest are not tenable in law. The assessee has been paying interest since 1999-2000 by making TDS as per provisions of law. The said interest has been allowed in all the preceding A.Y. The recipient is declaring the interest income in its return of income. The CIT(A) has very rightly declined to invoke Explanation to Sec. 37(1) in respect of this payment of interest. No interference is called for with the findings of the CIT(A);
++ on the issue of payment made in respect to Development expenses, it is an undisputed fact that the assessee has simply reimbursed the expenditure incurred, on such reimbursement of expenditure, there is no liability for TDS;
++ on the issue of payments received as advances from sister concern, the assessee is directed to furnish the share holding pattern in the related companies during the year under consideration. The AO is directed to verify whether the assessee is a share holder of M/s. Gazebo Industries Ltd. or whether the assessee has any substantial interest in any concern which has a substantial interest in M/s. Gazebo Industries Ltd. and decide this issue afresh as per provisions of law.
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