From The Desk of CA SANDHYA JAIN

Ek ghar ho sapno ka, Ghar ek mandir, we have seen these sort of connotations used by various builders while promoting their ventures. As an ordinary man buying a property requires huge initial outlay and that will be bifurcated as actual amount paid, stamp duty, registration fee etc. Assessee always want to get maximum tax benefit, so in this article we will discuss the expenses paid on property, where are the areas they can be claimed and in what manner. Chapter VIA- Deductions in respect of certain payments states u/s 80c (1) “ In computing the total income of assess being an individual or a HUF, there shall be deducted, in accordance with deposited in the previous year, being the aggregate of the sums referred to in subsection (2) as does not exceed one lakh rupees (2)The sum referred to in sub section (1) shall be any sum paid or deposited in the previous year by assessee-“ (i)-(xvii)……………. (xviii) for the purposes of purchase or construction of residential house p...

On 19th of August 2013 CBDT issued a circular stating that certain income of a specified assessee is exempt u/s 10(48) of Income Tax Act, 1961. So to understand this notification first we should have knowledge that “what is the Sec. 10(48)” and what it exactly speaks . As we, all are aware that sec 10 of the income tax is specifically devoted for exemptions and furthermore clause 48 too is the part of the same pool. Section 10(48) states that any income received by a foreign company from sale of crude oil in India is exempt provided that such company is not engaged in any other activity in India. Under this notification, the receipt of Income of the National Iranian Oil Company is exempt u/s 10(48) from the sale of Crude Oil to India .  This Notification comes into effect from January 20 th  2013 i.e. retrospectively. Text of Sec 10(48) of Income Tax Act, 1961  In computing the total income of a previous year of any person, any income falling under thi...

The CBDT has issued Instruction No. 10 of 2013 dated 05.08.2013 announcing the procedure and criteria for selection of scrutiny cases under the compulsory manual for FY 2013-14 INSTRUCTION NO 10/2013, F.No.225/107/2013/ITA.II Dated: August 5, 2013 Procedure and criteria for selection of scrutiny cases under compulsory manual during the financial-year 2013-2014-regd .In supersession of earlier instructions on the above subject, the Board hereby lays down the following procedure and criteria for manual selection of returns/cases for scrutiny during the financial-year 2013-2014 2. The targets for completion of scrutiny assessments and strategy of framing quality assessments as contained in Central Action plan document for Financial Year 2013-2014 has to be complied with. It is being reiterated that all scrutiny assessments including the cases selected under manual criteria will be completed through AST system software only. 3. The following categories of cases / returns ...

In the month of august 2013, the parliamentary standing committee on finance released its report on the 115th Constitutional Amendment Bill, which had been referred to it by the government in 2011. This Bill lays out the framework and the implementation plan for a national goods and services tax (GST), which many observers have said will be a fiscal game-changer. It will, on the one hand, streamline the entire indirect tax system by eliminating interstate differentials in tax rates, subsuming a large number of local taxes into an aggregate levy, which, once paid, can be claimed as credit against subsequent tax payments anywhere in the country. On the other, it will incentive countless producers to enroll themselves into the tax system, because not to do so would now reduce their competitive edge. This will significantly raise the tax-to-GDP ratio. With both production efficiency and tax revenue benefits, one might wonder why the system is taking so long to introduce the new mechanism....

1.       TAN or Tax Deduction and Collection Account Number is a 10 digit alpha numeric number required to be obtained by all persons who are responsible for deducting or collecting tax. 2.       All those persons who are required to deduct tax at source or collect tax at source on behalf of Income Tax Department are required to apply for and obtain TAN. It is compulsory to quote TAN in TDS/TCS return (including any e-TDS/TCS return), any TDS/TCS payment challan and TDS/TCS certificates. 3.       The provisions of section 203A of the Income-tax Act require all persons who deduct or collect tax at source to apply for the allotment of a TAN. It is mandatory to quote TAN in all TDS/TCS return as well as TDS/TCS certificates and payments challan. 4.       TDS/TCS returns will not be received if TAN is not quoted and challans for TDS/TCS payments will not be accepted by banks. ...

Type of Lease   How many types of lease are you aware? Did you know that how many types of leases are exist in financial world, you will say that Operating and finance lease. Here I will discuss few of them. But first of all we have to understand what is Lease What is Lease Lease is a legal document outlining the terms under which one party agrees to rent property from another party. A lease guarantees the lessee (the renter) use of an asset and guarantees the lessor (the property owner) regular payments from the lessee for a specified number of months or years. Both the lessee and the lessor must uphold the terms of the contract for the lease to remain valid. Or in other words Leases are the contracts that lay out the details of rental agreements b/w the lessor and lessee for the use of specified asset for the specified time. For example, if you want to rent an apartment, the lease will describe how much the monthly rent is, when it is due, what will happe...

TAN is a allotted to persons who are deducting or collecting tax at source on behalf of the Income Tax Department where as PAN is allotted to assessees like individuals, companies etc for filling their Income Tax Returns and to Pay own taxes.

It is human nature to jump at and exploit to the fullest extent, everything that is new to our world. It happened with petroleum; it happened with Sachin Tendulkar; it also started happening with the Transfer Pricing provisions. After the introduction of the Transfer Pricing Regulations vide the Finance Act, 2001, the number of audits started increasing, along with the number of the pending cases. To curb the same, section 92CB was introduced vide Finance Act, 2009, which provided that the determination of arm’s length price under section 92A/92C shall be subject to certain “Safe Harbour Rules”. The intent was clear – do NOT scrutinize every single assessee who enters into a transaction with its international associate. “Safe Harbour” was defined to mean those transactions for which the Revenue would accept the transfer price declared by the assessee. Vide the aforesaid amendment in 2009, the Government also empowered the CBDT to make the said “Safe Harbour Rules”. However, after m...

In order to reduce the increasing number of transfer pricing audits and prolonged disputes, the Finance (No.2) Act, 2009 w.r.e.f 1.4.2009 inserted a new section 92CB to provide that determination of arm’s length price under section 92C or Section 92CA shall be subject to safe harbour rules. Vide this amendment, the Government of India had empowered the CBDT to make Safe Harbour rules. “Safe harbour” was defined to mean circumstances in which the income-tax authorities shall accept the transfer price declared by the assessee. Thereafter, the issuance of the Safe Harbour Rules was examined and discussed at various points of time, but no finality could be reached. Since a number of representations were received from different stakeholders to prescribe the safe harbor rules, the Prime Minister on July, 30, 2012 approved the constitution of a Committee to Review Taxation of Development Centres and the IT sector consisting of Shri N.Rangachary, Chairman of the Committee and thre...

CBDT has issued draft on SAFE HARBOUR RULES 10TA to 10TG which defines Software development services, Information Technology Enabled Services, Knowledge processes outsourcing services, intra-group loan, corporate guarantee, contract research and development services wholly or partly relating to software development, core auto components, non-core auto components, No tax or low tax country or territory, It also defines the Operating expenses, Revenue & operating profit margin in relation to operating expense. It also defined who can be eligible assessee and which transactions fall in eligible international transaction as well as procedure to obtain the safe harbour .  It also states that the Safe harbour Rules not to apply in cases respect of eligible international transactions entered into with an associated enterprise located in any country or territory notified under section 94A or in a no tax or low tax country or territory. Where transfer price in relation to an eligible ...