Vistra Insights

Vistra India Update 397

April 1st 2020 - April 16th 2020

INCOME TAX

1.    Order u/s 119 of the Income-tax Act, 1961 (the Act) regarding submission of Form 15G and 15H for Financial Year-2020-21-reg

In case if a person had submitted valid Forms 15G and 15H to the Banks or other Institutions for F.Y. 2019-20, then these Form 15G and 15H will be valid up to 30.06.2020 for FY 2020-21 also. 

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2.    Order u/s 119 of the Income-tax Act, 1961 on issue of certificates for lower rate/nil deduction/collection of TDS or TCS u/s 195, 197 and 206C (9) of the Act for Financial Year 2019-20-reg

In cases where the assesses could not apply for issue of lower or nil deduction of TDS / TCS in Traces Portal for the FY 1020-21, but were having the certificates for F.Y. 2019-20, such certificate will be applicable till 30.06.2020 of F.Y. 2020-21. However, they need to apply at the earliest giving details of the transactions and the Deductor / Collector to the TDS / TCS Assessing Officer as per procedure laid down in order as soon as normalcy is restored or 30.06.2020, whichever is earlier.

Threshold limit mentioned in certificate for 2019-20 will be taken fresh for period from 01.04.2020 to 30.06.2020 for FY 2020-21 and the amount of threshold limit will be the same as was assigned for these certificates for F.Y. 2019-20.

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3.    Submission of certificate for claiming deductions U/S 80G of the Income Tax Act, 1961 in respect of donation made by an employee to the Prime Minister’s Citizen Assistance and Relief in Emergency Situations Fund (PM CARES FUND)

In case donation is made by employee through his employer, the Fund may not be able to issue separate certificate to every such employee in respect of donation so made. Therefore, it is hereby clarified that the deduction in respect of such donations as made will be admissible u/s 80G of the Act on the basis of the Form 16 issued by employer in this regard.

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4.    Clarification in respect of option under section 115BAC (new tax regime) of the Income-tax Act, 1961

An employee, having income other than the income under the head "profit and gains of business or profession" and intending to opt for the concessional rate under section 115BAC of the Act, may intimate the deductor, being his employer, of such intention for each previous year and upon such intimation, the deductor shall compute his total income, and make TDS thereon in accordance with the provisions of section 115BAC of the Act. If such intimation is not made by the employee, the employer shall make TDS without considering the provision of section 115BAC of the Act. 

It is also clarified that the intimation so made to the deductor shall be only for the purposes of TDS during the previous year and cannot be modified during that year. However, the intimation would not amount to exercising option in terms of sub-section (5) of section 115BAC of the Act and the person shall be required to do so along with the return to be furnished under sub-section (1) of section 139 of the Act for that previous year. Thus, option at the time of filing of return of income under sub-section (1) of section J 39 of the Act could be different from the intimation made by such employee to the employer for that previous year.

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5.    Finance Bill 2020

Finance Minister unveiled the India Budget for 2020-21 on 1st Feb 2020 aimed at reviving the economy.   

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COMPANY LAW

6.    Clarification of Passing Ordinary and Special Resolutions

In view of current circumstances prevailing on account COVID-19 situation and consequence of requirement to follow social distancing and lockdown norms, Ministry of Corporate Affairs (MCA) has issued clarifications on process to be followed by Companies to pass ordinary and special resolution. The MCA has also clarified on manner of issuing notices to call for general meeting. 

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7.    Clarification on spending CSR Funds for COVID-19

Ministry of Corporate Affairs (MCA) has issued a fresh set of clarification on CSR funds utilization relating to COVID 19. 

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8.    Clarification under section 124 and 125 of Companies Act, 2013

In view of the outbreak of COVID-19, Ministry of Corporate Affairs (MCA) has issued clarification relating to transfer of money remaining unpaid or unclaimed for a period of seven years and transfer of shares in terms of provision of section 124 of the Companies Act, 2013 read with IEPFA (Accounting, Audit, Transfer and Refund) Rules.

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RBI AND FEMA

9.    Rupee Drawing Arrangement – Remittance to the PM – CARES Fund

In the wake of outbreak of the novel coronavirus (COVID-19) pandemic, it has been decided to permit receipt of foreign inward remittances from non-residents through non-resident exchange houses in favour of the PM-CARES Fund, subject to the condition that AD Cat-I banks shall directly credit the remittances to the Fund and maintain the full details of the remitters.

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GOODS AND SERVICES TAX

10.    Notification No. 30/2020- Central Tax, dated 03.04.2020

Amendment in the CGST Rules so as to allow taxpayers opting for the Composition Scheme for the financial year 2020-21 to file their option in FORM CMP-02 till 30th June, 2020 and to allow cumulative application of the condition in rule 36(4) for the months of February, 2020 to August, 2020 in the return for tax period of September, 2020.  Further they shall also furnish the statement in FORM GST ITC-03 in accordance with the provisions of sub-rule (4) of rule 44 upto the 31st day of July, 2020

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11.    Notification No. 31/2020- Central Tax, dated 03.04.2020

A lower rate of interest of NIL for first 15 days after the due date of filing return in FORM GSTR-3B and @ 9% thereafter is notified for those registered persons having aggregate turnover above Rs. 5 Crore and NIL rate of interest is notified for those registered persons having aggregate turnover below Rs. 5 Crore in the preceding financial year, for the tax periods of February, 2020 to April, 2020. This lower rate of interest shall be subject to condition that due tax is paid by filing return in FORM GSTR-3B by the date(s) as specified in the Notification.

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This notification shall be deemed to have come into force with effect from the 20th day of March, 2020.

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12.    Notification No. 32/2020- Central Tax, dated 03.04.2020

Notification under section 128 of CGST Act for waiver of late fee for delay in furnishing returns in FORM GSTR-3B for the tax periods of February, 2020 to April, 2020 provided the return in FORM GSTR-3B by the date as specified in the Notification

Provided also that the amount of late fee payable under section 47 shall stand waived for the tax period as specified in column (3) of the Table given below, for the class of registered persons mentioned in the corresponding entry in column (2) of the said Table, who fail to furnish the returns in FORM GSTR-3B by the due date, but furnishes the said return according to the condition mentioned in the corresponding entry in column (4) of the said Table, namely:--.

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This notification shall be deemed to have come into force with effect from the 20th day of March, 2020.

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13.    Notification No. 33/2020- Central Tax, dated 03.04.2020

Notification under section 128 of CGST Act for waiver of late fee for delay in furnishing the statement of outward supplies in FORM GSTR-1 for taxpayers for the tax periods March, 2020 to May, 2020 and for quarter ending 31st March 2020 if the same are furnished on or before 30th day of June, 2020.

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14.    Notification No. 34/2020- Central Tax, dated 03.04.2020

Extension of due date of furnishing statement, containing the details of payment of self-assessed tax in FORM GST CMP-08 for the quarter ending 31st March, 2020 till the 7th day of July, 2020 and filing FORM GSTR-4 for the financial year ending 31st March, 2020 till the 15th day of July, 2020.

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15.    Notification No. 35/2020- Central Tax, dated 03.04.2020

Notification under section 168A of CGST Act for extending due date of compliance which falls during the period from the 20th day of March, 2020 to the 29th day of June, to 30th day of June, 2020.

The Notification is as follows:

 (i) where, any time limit for completion or compliance of any action, by any authority or by any person, has been specified in, or prescribed or notified under the said Act, which falls during the period from the 20th day of March, 2020 to the 29th day of June, 2020, and where completion or compliance of such action has not been made within such time, then, the time limit for completion or compliance of such action, shall be extended upto the 30th day of June, 2020, including for the purposes of-- 

(a) completion of any proceeding or passing of any order or issuance of any notice, intimation, notification, sanction or approval or such other action, by whatever name called, by any authority, commission or tribunal, by whatever name called, under the provisions of the Acts stated above; or 
(b) filing of any appeal, reply or application or furnishing of any report, document, return, statement or such other record, by whatever name called, under the provisions of the Acts stated above; 

but, such extension of time shall not be applicable for the compliances of the provisions of the said Act, as mentioned below - 
(a) Chapter IV; 
(b) sub-section (3) of section 10, sections 25, 27, 31, 37, 47, 50, 69, 90, 122, 129; 
(c) section 39, except sub-section (3), (4) and (5); 
(d) section 68, in so far as e-way bill is concerned; and 
(e) rules made under the provisions specified at clause (a) to (d) above; 

(ii) where an e-way bill has been generated under rule 138 of the Central Goods and Services Tax Rules, 2017 and its period of validity expires during the period 20th day of March, 2020 to 15th day of April, 2020, the validity period of such e-way bill shall be deemed to have been extended till the 30th day of April, 2020. 

2. This notification shall come into force with effect from the 20th day of March, 2020

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16.    Notification No. 36/2020- Central Tax, dated 03.04.2020

Notification under section 168A of CGST Act for extending due date of compliance which falls during the period from the 20th day of March, 2020 to the 29th day of June, to 30th day of June, 2020.

The notification reads as follows:

 “Provided also that, for taxpayers having an aggregate turnover of more than rupees 5 crore rupees in the previous financial year, the return in FORM GSTR-3B of the said rules for the month of May, 2020 shall be furnished electronically through the common portal, on or before the 27th June, 2020:
 
Provided also that, for taxpayers having an aggregate turnover of up to rupees five crore rupees in the previous financial year, whose principal place of business is in the States of Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana, Andhra Pradesh, the Union territories of Daman and Diu and Dadra and Nagar Haveli, Puducherry, Andaman and Nicobar Islands or Lakshadweep, the return in FORM GSTR-3B of the said rules for the month of May, 2020 shall be furnished electronically through the common portal, on or before the 12th day of July, 2020: 

Provided also that, for taxpayers having an aggregate turnover of up to rupees five crore rupees in the previous financial year, whose principal place of business is in the States of Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand or Odisha, the Union territories of Jammu and Kashmir, Ladakh, Chandigarh or Delhi, the return in FORM GSTR-3B of the said rules for the month of May, 2020 shall be furnished electronically through the common portal, on or before the 14th day of July, 2020.”

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17.    Clarification in respect of certain challenges faced by the registered persons in implementation of provisions of GST Laws-reg.

A six-point clarification is issued for specific business transactions and tax compliance during the COVID-19 led lockdown.

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18.    Circular No. 136/06/2020-GST dated 3rd April 2020

Notifications 30 to 35 were issued by Central Board of Indirect Taxes and Customs (CBIC) to provide relief to tax payers in the form of reduced interest rate applicable for late payment of taxes and waiver of penalty for late filing of the returns subject to conditions.

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CUSTOMS

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

The Central Board of Excise and Customs (CBEC) vide Notification No. 37/2020 - 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 2nd April 2020.

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LABOUR LAWS


20.    Employees’ Provident Fund Organization (EPFO) has issued a circular on the list of documents to be accepted as a valid proof for Date of Birth of a member. 

Employees Provident Fund Organization (EPFO) vide its circular no. WSU/37(1)2019/DOB dated 3 April 2020 has listed down the documents to be accepted as a valid proof for Date of Birth of member in supersession of earlier circulars.  As per the notification, the following are the list of documents:

1)    Birth Certificate issued by the Registrar of Births and Deaths 
2)    Any School/education-related certificate
3)    Certificate based on the service records of the Central/ State Government Organizations
4)    Passport
5)    Any other reliable document issued by a government department.
6)    In the absence of proof of date of birth as above, Medical Certificate issued by Civil Surgeon after examining the member medically and supported with an affidavit on oath by the member duly authenticated by a Competent Court
7)    Aadhar/e-Aadhar: The change in date of birth shall be accepted as per Aadhar /e- Aadhar up to a maximum range of plus or minus three years of the date of birth recorded earlier with EPFO. 

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21.    Employees Provident Fund Organization (EPFO) has released the guidelines towards the implementation of Pradhan Mantri Garib Kalyan Yojana (PMGKY) towards the credit of Employers and Employees Provident Fund contribution. 

Employee Provident Fund Organization (EPFO) has released the circular and guidelines towards the implementation of Pradhan Mantri Garib Kalyan Yojana (PMGKY) package for credit of Employees and Employers Share of provident fund i.e. 24% of wages for three months by Government of India. 

As per the notification, with a view to prevent disruption in the employment of low wage-earning employees and support establishments employing up to one hundred employees, the entire employees’ provident fund contributions i.e. 12% of wages and employers’ provident/pension fund contributions i.e. 12% of wages, totaling 24% of the monthly wages for the next three months shall be directly paid by the Central Government in the provident fund accounts (UAN) of employees, who are already members of Employees Provident Funds Scheme,1952, drawing wages less than fifteen thousand rupees per month and employed in establishments, already covered under the Employees Provident Funds and Miscellaneous Provisions Act 1952, employing up to one hundred employees, with 90% or more of such employees earning less than fifteen thousand rupees monthly wages 

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22.    Due date of Employees State Insurance (ESI) contribution for the month of February 2020 further extended

Employees State Insurance Corporation (ESIC) as a relief measure earlier extended the period for filing ESI contribution for the month of February 2020 and March 2020 to 15 April 2020 and 15 May 2020. Now, after considering the hardships faced by the employers, the period for filing ESI contribution for the month of February has been further extended from earlier extended period i.e. 15 April to 15 May 2020. No penalty or interest or damage will be levied on establishments during the extended period. 

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23.    Due date of Provident Fund (PF) contribution for the month of March 2020 extended

Employee Provident Fund Organization (EPFO) vide its notification no. C-I/Misc./2019-20/Vol. II/Part./9 dated 15 April 2020 has extended the due date for payment of contributions and administrative charges/ inspection charges due for wage month March 2020 from 15 April 2020 to 15 May 2020 i.e. grace period of thirty days for filing of Electronic Challan cum Return(ECR) to establishments disbursing wages for March 2020. 
Employers seeking the above relief need to file ECR for wage month March 2020 on or before 15 May 2020 duly certifying the disbursement of wages to employees by declaring actual date of disbursement of wages for March 2020 in the column "Salary disbursal date" in the ECR and remit the contributions and administrative/inspection charges on or before 15 May 2020. 

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