Daily news bulletin- 29/ 9/ 2022

1. Revised ITR filed will not amount to non-filing of return : ITAT

Passing the verdict on the Ujjivan Small Bank Finance Limited Case, the Bangalore bench of Income Tax Appellate Tribunal held, that once the Income Tax Returns has been filed within the due date, under section 139 of the Income Tax Act, the filing of its revised form, even after the due date will not be considered as late filing or non filing of returns. In other words, the late filing of revised returns will not affect the date of filing the original returns in any way.

2. SEBI modifies “daily price limit” for commodity futures contracts to bring parity with International Exchange

Securities and Exchange Board of India has recently modified the Daily Price Limit for Commodities sold under Future contracts. This decision has been taken to bring at par, the domestic and international closing limits of exchange values, which often differ due to the difference in the method of their calculation. From now on, the daily price limit will be modified by 3% every 15 minutes when the prices of commodities in the international markets are more than the domestic daily price limits.

3. CBIC notifies all amendments of Finance Act, 2022 w.e.f October 1st, 2022: Notification

In its recent move, the Central Board of Indirect Taxes and Customs has notified all the provisions of Finance Act, 2022,

Highlighting major changes, like permission to claim Input Tax Credit till November 30th of the next financial year, issuing credit notes till November 30th of the next financial year, and the omission of Sections 42, 43, and 43 A of the GST Act, 2016.

These sections are related to the matching, reclaim, reversal, and returns submitted to claim input tax credit

4. Form 16 A as proof for TDS deduction does not imply Employer-Employee relationship with freelancer: Delhi High Court

The Delhi High Court, in its recent judgment held that a mere exchange of official emails, and issue of Certificate of Tax deducted at the source of income, will not imply an employer-employee relationship between the employer and a freelancer working for the employer. The court, in this context, said that a Freelancer is a person who is self-employed or who is an independent contractor, selling his services and skills to different employers for only a specific time period. Therefore, a mere submission of documents will not change this relationship into that between an employer and the permanent salaried employees of the business organization.

5. Extension of time for filing e-form DIR 3 and DIR KYC Web form without fee upto 15th October 2022

Forms DIR 3 and DIR 3 KYC are meant for the application of Director Identification number and the KYC of the directors of a company. For the year 2022, the Ministry of Corporate Affairs had decided 30th September as the deadline of filing the two forms. However, after a request from the representatives, the ministry has recently extended the deadline to 15th October, 2022.

6. Recovery of Annual Report and Share Certificate from Assessee Aren’t Incriminating Documents: Delhi HC

A Division Bench of the Delhi High Court while upholding the order of the Delhi Bench of the Income Tax Appellate Tribunal(ITAT), held that, the recovery of annual report and share certificates from the assessee are not incriminating documents as they were seized from the issuing authority of the share certificates.

7. When the Entire Service is Performed Outside India, No Service Tax will be levied

The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal has ruled that service tax cannot be charged on Business Exhibition Services by the assessee where the services offered outside India. Even such a service is not considered as an import of service by the country where the service is being offered, under the Taxation of Service (Provided from Outside India and Received in India) Rules, 2006.

8. No Compulsory Scrutiny When ITR Is Provided Under Section 142: CBDT

The Central Board of Direct Taxes, under the Ministry of Finance, has published instructions directing that when a return is filed in response to a notice issued under section 142 clause (1) of the Income Tax Act, it would not be subjected to mandatory examination. Note that, such notice must have been issued due to the information contained information in the Significant financial Transactions, Non-filers monitoring system, or information received from the Directorate of I&CI, then such return will not be taken up for compulsory scrutiny but instead that the scrutiny for the same will be done through CASS cycle.

9. Demand for Late Fee on TDS Default Under Section 234E Is Unsustainable: ITAT

The Income Tax Appellate Tribunal (ITAT), Bangalore Bench, has declared that the demand for late fees on TDS violations prior to 01/06/2015 is unsustainable. The decision comes in the light of judgment passed over the assessee, Shimas Network Pvt. Ltd, which filed its TDS returns belatedly. This was accepted by TIN. The ITO Centralized Processing Cell-TDS levied a late fee of Rs. 64,480/- for the delay as per intimation under section 200 A of the Income Tax Act Act.

10. ITAT Grants Full TDS Credit Because Commission Income Is Not Managerial Service Under India-Germany DTAA

The Income Tax Appellate Tribunal, New Delhi Bench, has recently allowed full TDS credit, on the grounds that Commission Income does not qualify as a “managerial service” under the India-Germany Double Taxation Avoidance Agreement (DTAA). The common issue in both the appeals was related, to the treating of commission income, received by the assessee, from Springer Nature India Private Limited. The fee was received as a fee for technical services, under Article 12 of the India-Germany Double tax avoidance agreement.