Vistra Insights

Vistra India Update 398

April 16th 2020 to April 30th 2020

INCOME TAX

1.    Order u/s 119 of the Income Tax Act, 1961 regarding reporting requirement under clause 30C and clause 44 of the Form 3CD

The changes in Tax Audit Report (TAR) for Clause 30C pertaining to General Anti-Avoidance Rules (GAAR) and Clause 44 pertaining to Goods and Services Tax (GST) compliance) of Form 3CD is deferred for the third time till March 2021. This time the deferment is due to COVID-19 pandemic.

Clause 30C. (a) Whether the assessee has entered into an impermissible avoidance arrangement, as referred to in section 96, during the previous year? (Yes/No.)
(b) If yes, please specify:—
(i) Nature of impermissible avoidance arrangement: 
(ii) Amount (in Rs.) of tax benefit in the previous year arising, in aggregate, to all the parties to the arrangement:

Clause 44. Break-up of total expenditure of entities registered or not registered under the GST:

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COMPANY LAW

2.    Clarification on holding AGM by Companies who’s FY had ended 31st December 2019

Ministry of Corporate Affairs (MCA) clarifies that in view of COVID-19 situation relating to social distancing and lock down situation, the Companies who’s FY has ended on 31st December, 2019, they can hold the AGM by 30th September 2020 and the delay will not be considered as noncompliance. 

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3.    Extension of due date for filing NFRA-2

Ministry of Corporate Affairs (MCA) has decided that the time limit for filing of Form NFRA-2, for the reporting period FY 2018-19 will be 210 days from the date of deployment of the form on the website of National Financial Reporting Authority. 

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4.    Companies (Appointment and Qualification of Directors) Second Amendment Rules, 2020

Ministry of Corporate Affairs (MCA) has amended Companies (Appointment and Qualification of Directors) Rule, 2014 to extend the time limit to seven month (from five months) for online application to the institute for inclusion of name in the data bank by a person who has been appointed as an independent director in a company, on the date of commencement of the Companies (Appointment and Qualification of Directors) Fifth Amendment Rules, 2019,  

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RBI AND FEMA

5.    Review of FDI policy

a.    The Government of India has reviewed the extant FDI policy for curbing opportunistic takeovers/acquisitions of Indian companies due to the current COVID-19 pandemic and amended the FDI policy

b.    A non-resident entity of a country, which shares land border with India or where the beneficial owner of an investment into India is situated in or is a citizen of any such country, can invest only under the Government route. Further, a citizen of Pakistan or an entity incorporated in Pakistan can invest, only under the Government route, in sectors/activities other than defence, space, atomic energy and sectors/activities prohibited for foreign investment.

c.    In the event of the transfer of ownership of any existing or future FDI in an entity in India, directly or indirectly, resulting in the beneficial ownership falling within the restriction/purview of the above para, such subsequent change in beneficial ownership will also require Government approval.

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CUSTOMS

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

The Central Board of Excise and Customs (CBEC) vide Notification No. 39/2020 - 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 17th April 2020.

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LABOUR LAWS 

7.    Karnataka Tax on Professions, Trades, Callings And Employments (Removal Of Difficulties) Order, 2020

The Government of Karnataka vide its order No.FD 03 CPT 2020 has extended the monthly professional tax contribution due date for the month of March 2020 from the existing date of 20 April 2020 to 20 May 2020 and the due date for payment of enrollment tax has been extended from the existing date of 30 April 2020 to 30 May 2020.

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