Saturday, 15 October, 2016

Vistra India Update 313

October 1st -15th, 2016

Applicability of TDS provisions u/s 194I of the Income Tax Act 1961 on lump sum lease premium paid for acquisition of long term lease, Income–tax (25th Amendment) Rules, 2016, Companies (Incorporation) 4th Amendment Rule, 2016, RBI issues NBFCs Auditor’s Report (Reserve Bank) Directions 2016, Employees’ State Insurance (Central) Amendment Rules, 2016 – Draft rules issued, Publishing of rate of exchange for conversion of the foreign currency.

Income Tax

Applicability of TDS provisions u/s 194I of the Income Tax Act 1961 on lump sum lease premium paid for acquisition of long term lease

Based on the judgement of the Hon’ble High Court of Delhi in the case of The Indian Newspaper Society and judgement of the Hon’ble High Court of Chennai in the case of Foxconn India Developer Limited, the Central Government has clarified that lump sum lease premium or one time upfront lease charges, which are not adjustable against periodic rent, paid or payable for acquisition of long term leasehold rights over land or any other property are not payments in the nature of rent within the meaning of section 194I of the Act. Therefore such payments are not liable for TDS under section 194I of the Act.

•Relevant Circular

 

Income–tax (25th Amendment) Rules, 2016

The central government has amended Income Tax Rules 1961 to notify Form No.68 which is to be used to make an application to the Assessing Officer to grant an immunity from imposition of penalty for under reporting and misreporting of income referred in section 270A, willful attempt to evade tax, etc., referred in section 276C and failure to furnish returns of income referred in section 276CC.

•Relevant Circular

 

Company Law

Companies (Incorporation) 4th Amendment Rule, 2016

MCA has notified the Companies (Incorporation) fourth Amendment Rules, 2016, introducing ‘Simplified Proforma for Incorporating Company Electronically (SPICE), i.e. Form No. INC-32 along with e-Memorandum of Association in Form No. INC-33 and e-Articles of Association in Form No. INC-34, besides few other changes in forms relating to incorporation. Important amendments mentioned below:

  • Introduced integrated INC 29 for getting the DIN, Name approval and Incorporation application.
  • Standard format of e-Articles of Association as per Companies Act, 2013
  • Memorandum and Articles will now be filed as linked e-forms (except for Section 8 companies).
  • One can attach the DSC of the subscribers and witness hence physical signature and photograph is not required.
  • Provision to apply for Company Incorporation with a preapproved Company name.

•Relevant Circular

 

RBI and FEMA

RBI issues NBFCs Auditor’s Report (Reserve Bank) Directions 2016

The above new Directions supersede the Non- Banking Financial Companies Auditor’s Report (Reserve Bank) Directions, 2008. These Directions will come into immediate effect from September 29, 2016. This Report issued to the Board of Directors of an NBFC is in addition to the Report made by the auditor under section 143 of the Companies Act, 2013 or section 227 of the Companies Act, 1956. If the auditor’s report contain any unfavorable or qualified statements on the matters to be reported by the Auditor, then the auditor should submit such an exception report to the concerned Regional Office of the Reserve Bank of India.

•Relevant Circular

 

Labour Law 

Employees’ State Insurance (Central) Amendment Rules, 2016 – Draft rules issued

The Central Government has issued draft rules to notify the following:

  1. Increase in the wage limit for coverage of an employee under Employee State Insurance Act 1948 from INR 15,000/- to INR 21,000/-.
  2. Insured women are now eligible for Maternity benefits for remuneration during a period of twenty six weeks (an increase from twelve weeks) of which not more than eight weeks shall precede the date of confinement.

The stake holders are requested to provide there feedback / suggestions to the Government within 30 days from date of publication of this notification in the official gazette.

•Relevant Circular

 

CUSTOMS

Publishing of rate of exchange for conversion of the foreign currency

The Central Board of Excise and Customs (CBEC) vide Notification No. 124/2016 – Customs (N.T.) notified the rate of exchange for conversion of the foreign currency into Indian currency or vice versa for Export and Import of goods, with effect from 7th of October 2016.

•Relevant Circular

 

Events

26 Sep
Monaco | 26 Sep - 29 Sep
Singapore | 27 Sep
Mauritius | 30 Sep
Mexico City | 4 Oct - 5 Oct
Luxembourg | 4 Oct - 5 Oct
Munich | 8 Oct - 10 Oct
Munich | 9 Oct
9 Oct - 10 Oct
Warsaw | 18 Oct
Dublin | 18 Oct
Chicago | 24 Oct - 25 Oct
London | 25 Oct - 26 Oct

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