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Vistra India Update 385

October 1 - October 15th, 2019

INCOME TAX


1.    Clarification in respect of option exercised under section 115BAA of The Income Tax Act, 1961 inserted through The Taxation Laws (Amendment) Ordinance, 2019

The Taxation Laws (Amendment) Ordinance, 2019 provides that a domestic company shall, at its option, pay tax at a lower rate of 22% for any previous year relevant to the Assessment Year beginning on or after 1st April, 2020, subject to certain conditions, including that the total income should be computed without claiming any deduction or exemption.

The option needs to be exercised by the company before the due date of furnishing return of Income and option once exercised cannot be subsequently withdrawn and shall apply to all subsequent assessment years. It is also provided that MAT provision will not be applicable to the assessee opting this option. 

Further it clarified that a domestic company which would exercise option for availing benefit of lower tax rate under section 115BAA shall not be allowed to set off any brought forward losses on account of additional depreciation for an Assessment year for which the option has been exercised and for any subsequent Assessment Year.

Still further it is clarified that the tax credit of MAT paid by the domestic company exercising option under section 115BAA of the Act shall not be available consequent to exercising of such option

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GOODS AND SERVICES TAX

2.    Due date of filing of GSTR – 1  extended

The Board vide Notification No. 45/2019 & 46/2019 – Central Tax has notified the due date for filing of GSTR – 1 as detailed below.

a.    For taxpayers with aggregate turnover up to Rs. 1.5 crores, filing of return for the quarters October 2019 and March, 2020 the due date shall be 31st January 2020 and 30th April 2020 respectively.

b.    For taxpayers with aggregate turnover of more than Rs. 1.5 crores for the months from October 2019 to March 2020 the due date of filing is 11th day of the succeeding month.

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3.    Due date of filing of GSTR – 3B  notified

The Board vide Notification No. 44/2019 – Central Tax has notified the due date for filing of GSTR – 3B return for the months from October 2019 to March 2020 to 20th day of the succeeding month.

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4.    Filing of annual return for F.Y. 2017-18 and 2018-19 optional for small taxpayers whose aggregate turnover is less than Rs 2 crores and who have not filed the said return before the due date

The Board vide Notification No. 47/2019 – Central Tax has notified that the registered persons whose aggregate turnover in a financial year does not exceed two crore rupees and who have not furnished the annual return before the due date in respect of financial years 2017-18 and 2018-19, shall follow the special procedure such that the said persons shall have the option to furnish the annual return. The said return shall be deemed to be furnished on the due date if it has not been furnished before the due date.

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5.    Central Goods and Services Tax (Sixth Amendment) Rules, 2019

The Board vide Notification No. 49/2019 – Central Tax has made certain amendments to CGST Rules which include among others the following.  

Input tax credit to be availed by a registered person in respect of invoices or debit notes, the details of which have not been uploaded by the suppliers under sub-section (1) of section 37, shall not exceed 20 per cent of the eligible credit available in respect of invoices or debit notes the details of which have been uploaded by the suppliers under sub-section (1) of section 37.

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6.    RCM on Renting of Motor Vehicle

Based on the recommendation of 37th GST Committee meeting the Board vide Notification No. 22/2019 – Central Tax & Notification No. 21/2019 – Integrated Tax has notified that services provided by any person other than a body corporate renting of a motor vehicle to a body corporate shall pay GST at the rate of  5% under Reverse Charge.

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7.    Clarification regarding determination of place of supply in case of software/design services related to Electronics Semi-conductor and Design Manufacturing (ESDM) Industry

Various representations have been received from trade and industry seeking clarification on determination of place of supply in case of supply of software/design services by a supplier located in taxable territory to a service recipient located in nontaxable territory by using the sample hardware kits provided by the service recipient.  The department vide Circular No. 118/37/2019 clarified that the place of supply of software/design by supplier located in taxable territory to service recipient located in non-taxable territory by using sample prototype hardware / test kits in a composite supply, where such testing is an ancillary supply, is the location of the service recipient.

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CUSTOMS

8.    Publishing of rate of exchange for conversion of the foreign currency

The Central Board of Excise and Customs (CBEC) vide Notification No. 72/2019 - 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 4th of October 2019.  

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