R & D: 2010

Wednesday, December 29, 2010

UPLOADED NEW 5 DIGIT ACTIVITY CODES FOR VAT AUDIT PURPOSE.

MVAT AUDIT 2009-10-ACTIVITY CODES

AS WE FOUND THAT MANY OF OUR CA FRIENDS AND STP'S ARE NOT HAVING THE NEWLY REQUIRED ACTIVITY CODE 5 DIGIT FILES.
HERE BY WE ARE UPLOADING IT FOR OUR COMMUNITY.

CLICK HERE TO DOWNLOAD (2 LINKS)-- DOWNLOADING TAKES TIME (FILE SIZE 1.31 MB)

http://dhavaldesaisays.files.wordpress.com/2010/12/activitycode1-2-1.pdf

OR

https://docs.google.com/viewer?a=v&pid=explorer&chrome=true&srcid=0Bz0INWeiJAEQNDFiOTQyODItNmQ2MS00ZDgxLWJjNzctYWRlNzRkYTZjMDM3&hl=en

Saturday, December 25, 2010

Case law-Ability to pay demand is no bar for grant of stay on recovery

KEC International Limited vs. ACIT (ITAT Mumbai)

The assessee filed a stay application before the Tribunal. The Department opposed by relying on the observations of the Supreme Court in CCE vs. Dunlop India 154 ITR 172 (SC) and contended that as paucity of funds had not been sufficiently demonstrated, for this reason alone stay should not be granted. HELD rejecting the Department’s contention and granting stay while following B. N. Nobis & Co vs. JCIT 71 TTJ 153 (Kol):

(i) While the Supreme Court has decried ‘the practice of granting interim orders merely because assessee is able to show a good prima facie case’, the observations have to be understood in the context of the case which was one of indirect taxation where the burden had already been passed on to the consumer. Also it was a case of a Writ Petition under Article 226 & not that of an appellate jurisdiction. The observations of the Supreme Court in the context of grant of stay in writ proceedings does not have binding force on, or even direct relevance to, the principles governing grant of stay during appellate proceedings though it does provide guidance on principles governing the decision to grant stay;

(ii) The Court has made it clear that though there are no hard and fast rules regarding grant of stay, prudence, discretion and circumspection are called for and stay should not be granted as a matter of course. Considerations about balance of convenience, question of irreparable injury and implications to public interest have to be borne in mind;

(iii) The Supreme Court’s observations in Dunlop cannot be interpreted to mean that the Tribunal is denuded of the powers to grant stay until case for financial stringency is successfully made out by the applicant. There is no conflict in holding this view as also adhering to the settled principles governing grant of stay which lay down thatfinancial constraints of the applicant are important, even if not sole of qualifying, consideration in entertaining a stay application, besides considerations like existence of strong prima facie case, balance of convenience and possibilities of Revenue’s rights of recovery being prejudiced by waiting till the outcome of appeals.

Saturday, December 18, 2010

Cash Flow v/s Profit & loss A/c

In case of entities like companies which present its financial statements on accrual basis, Cash flow Statements fulfills vital information needs of users?

The Supreme Court in Reliance Energy Ltd Vs. Maharashtra State Road Development Corporation Ltd.

When P&L accounts and balance sheets are prepared on accrual basis, revenues and expenses are recognized on accrual basis

i.e. when events or transaction occurs. However, timing of cash flow is not reckoned in such system of accounting.

Similarly, in cases where accounts are based on accrual system of accounting, recognition of assets & liabilities is not dependent on the actual timing of cash spent on capital Expenditure & Cash inflow on Capital receipts.

Thus, financial statements prepared on accrual basis don not reflect the timing of Cash flow & amount of Cash flow.

The object of the cash flow statement is to assess the company ability to generate the cash flow in future and to assess reason for difference between “NET PROFIT” and “NET CASH FLOW” from operations.

In Fact Cash flow from operations is the regular sources of cash for any enterprise that determines whether or not an enterprise will continue to exist in the long run.

Accrual basis of accounting requires that revenues be recorded when earned and the expenses be recorded when incurred. Earned revenues more often include credit sales that have not been collected in cash & expense incurred that may not have been paid in cash during the accounting period.

Thus, Net Income will not indicate the net cash provided by operating activities or net loss will not indicate the net cash used in operating activities.

In order to calculate the net cash provided by (or used in) operating activities, it is necessary to replace revenues and expenses on accrual basis with actual receipts and actual payments in cash. This is done by eliminating non- cash revenues and non-cash expenses from the given earned revenues & incurred expenses in the profit & loss account.

Profit & Loss account is also debited with purely non-cash items which reduces and increase the profits respectively but do not affect the cash at all. Eg: Depreciation, P/L on sale of fixed assets, amortization of deferred revenue expenses and so on.

Since Cash provide by operations is to be calculated, certain Non-operation item like rent income, interest income, dividend income, refund of tax etc should be adjusted although these items may have recorded on cash basis. Such items are analysed separately in the cash flow statement as operating, financing & investing activities.

Post uploaded by: Sumeet Mishra.

Tuesday, November 30, 2010

Renting Judgement In Favour of Govt. by P&H High Court - Bad News

IN
THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH.

CWP No. 11597 of 2010 (O&M)

M/s Shubh Timb Steels Limited-----Petitioner
Versus
Union of India and another----Respondents

Coram:Mr. Justice Adarsh Kumar Goel and Mr. Justice Ajay Kumar Mittal

Date of Judgment: 22.11.2010

Excerpts : It cannot be held that renting of property did not involve any service as service could only be in
relation to property and not by renting of property. Renting of property for commercial purposes is certainly a service and has value for the service receiver. Even if it is held that transaction of transfer of right in immovable
property did not involve value addition, the provision cannot be held to be void in absence of encroachment on List II.(Para 22)

It is well settled that competent legislature can always clarify or validate a law retrospectively. It cannot be held to be harsh or arbitrary. Object of validating law is to rectify the defect in phraseology or lacuna and to effectuate and to carry out the object for which earlier law was enacted. We do not find any ground to set aside giving of retrospective effect to the amendment from 1.6.2007 on which date levy was initially provided."

FULL TEXT ATTACHED

Click here to download: http://dhavaldesaisays.files.wordpress.com/2010/11/renting.doc

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Tuesday, May 25, 2010

CA IPCC Group 1 papers with sugested answers.

Frnds,

Just click here to download the IPCC grp1 papers with sugested answers.

Click here: http://docs.google.com/leaf?id=0Bz0INWeiJAEQOTg0NTNlODAtNjg0Zi00NTVkLTkwYTUtMTIwZWQ4NGY2NTI5&hl=en

I am thankful to pavan kumar & Sayad vakeel who have contributed to our blog and this file is shared by them.

Dhaval Desai

Wednesday, May 5, 2010

Company Audit Important Sections,AS and SA's and revised text of Companies Act 227 (1A)

Friends,

I know that at the end time i m publishing this article but i believe that this file will surely help you to score well in exams and will help you to score well.

Best wishes
Dhaval Desai & this document is verified by Pappu Mishra.

Click here to download the files
1.Company Audit (Sections,AS and SA.s): http://docs.google.com/fileview?id=0Bz0INWeiJAEQZTFjYzMxN2QtNTAxZi00OTZhLThlZDQtZDk0NjZiNTYzZTdi&hl=en

2.Companies Act 227 (1A): http://docs.google.com/fileview?id=0Bz0INWeiJAEQYjNlMGMzYzAtYjgzMS00OGFhLWE3OGUtN2UzZjcxZmNlNDhm&hl=en

This file is Shared by and his message is given below.

Friends here is some important sections of company audit.You are advised to verify the same from module/compilations.This is exclusively for Taxpertindia members and welwishers. Have a good luck!!!!

Vakeel Ali
Dhule, Maharashtra.

Monday, March 29, 2010

Final NEW Suggested Answers November 2009- ISSUED BY ICAI

Hello,
I would like to bring your attention on a new post published on the Website. Details of the post follow; I hope you will find it interesting.
Best regards,
Dhaval

Final NEW Suggested Answers November 2009- ISSUED BY ICAI
GROUP - I Not Yet Released.

Group - II Click here to download: http://www.box.net/shared/rfufppujov

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PCC Suggested Answers November 2009 - ISSUED BY ICAI

Hello,
I would like to bring your attention on a new post published on the Website. Details of the post follow; I hope you will find it interesting.
Best regards,

PCC Suggested Answers November 2009 - ISSUED BY ICAI

Group - I -- Not Yet Released Group --- wud soon upload

Group II- Click here to download: http://www.box.net/shared/sq7lnff203

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Tuesday, March 16, 2010

"Tax-Rate of C-schedule goods (except declared goods) is increased from 4% to 5% from 1st April 2010."

"Tax-Rate of C-schedule goods (except declared goods) is increased from 4% to 5% from 1st April 2010."

Click here to download the file:
http://docs.google.com/fileview?id=0Bz0INWeiJAEQY2VkNmVkOGMtMjgxOS00NjcwLWE5MjktZWQ1ODlkMzZjODU4&hl=en

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Tuesday, March 9, 2010

Compilation of Suggested Answers Professional Competence Course( PCC) Cost Accounting

CHAPTER 1 - BASIC CONCEPTS

CHAPTER 2 - MATERIAL

CHAPTER 3 - LABOUR

CHAPTER 4 - OVERHEADS

CHAPTER 5 - NON INTEGRATED ACCOUNTING

CHAPTER 6 - METHOD OF COSTING (I)

CHAPTER 7 - METHOD OF COSTING (II)

CHAPTER 8 - STANDARD COSTING

CHAPTER 9 - MARGINAL COSTING

CHAPTER 10 - BUDGETS AND BUDGETARY CONTROL

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Revision Test Papers for MAY 2010 Examination

Monday, February 22, 2010

Announcement relating to taxation papers for students appearing in May 2010 examination PE-II [Income-tax and Central Sales Tax], PCC/IPCC [Taxation], Final (Old) Course [Direct Taxes] and Final (New) Course [Direct Tax Laws] - (22-02-2010)

Announcement relating to taxation papers for students appearing in May 2010 examination PE-II [Income-tax and Central Sales Tax], PCC/IPCC [Taxation], Final (Old) Course [Direct Taxes] and Final (New) Course [Direct Tax Laws] - (22-02-2010)

Announcement relating to taxation papers for students appearing in May 2010 examination

PE-II [Income-tax and Central Sales Tax], PCC/IPCC [Taxation],

Final (Old) Course [Direct Taxes] and Final (New) Course [Direct Tax Laws]

(1) Fringe Benefit Tax is not applicable from A.Y.2010-11 and hence, is not relevant for May 2010 examination.

(2) Consequential Notification of new perquisite rules on 18.12.2009 not to apply for May 2010 examination

Consequent to abolition of fringe benefit tax, certain benefits taxed earlier as fringe benefits in the hands of the employer would now be taxable as perquisites in the hands of the employees. For this purpose, new perquisite valuation rules have been notified vide Notification No.94/2009/ F.No.142/25/2009-S.O.(TPL), dated 18.12.2009 with retrospective effect from 1.4.2009. However, the new perquisite valuation rules would be applicable only for November 2010 examination. They would not be applicable for May 2010 examination, since only notifications/circulars issued up to 31^st October, 2009 are relevant for May 2010 examination.

(3) Applicability of erstwhile Rule 3 for May 2010 examination

(a) Therefore, the erstwhile Rule 3 would be applicable for May 2010 examination. All the perquisites which were earlier taxable in the hands of the employee, only if the employer was not liable to pay fringe benefit tax, would now be taxable in the hands of the employee in all cases, since no employer is liable to pay fringe benefit tax for A.Y.2010-11.

(b) Rule 3(7), providing for valuation of “other fringe benefits and amenities”, is based on the terms of the provisions contained in the erstwhile clause (vi) of section 17(2). The Finance (No.2) Act, 2009 has amended section 17(2) by including certain other perquisites under clauses (vi) and (vii) of section 17(2). Consequently, the residual clause, namely, clause (viii) of section 17(2), now provides for taxing the value of any other fringe benefit or amenity as may be prescribed. Therefore, the Rule 3(7), prescribing the fringe benefits or amenities in terms of the erstwhile clause (vi) [now clause (viii)] of section 17(2)] have been given in the latest study material relevant for May 2010 examination.

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Wednesday, February 17, 2010

ISCA NOTES & Information Technology ACT 2008 (2 FIles uploaded)

Friends.. There might be a sure shot question in the forthcoming exam…

The Information Technology Act 2000 is covered under Chapter 14 of Paper 6: MICS ( Final Old ) and Chapter 10 of Paper 6: Information Systems

This act was amended in the Year 2009. And keeping in mind the institute’s eternal inclination towards all the recent amendments I would say that we all should go through amendments made in the Act (since the changes are of significant importance too!).

and i am also hereby uploading ISCA (CA FInal NEW)notes with past papers analysis which are prepared by Nikunj S. Shah B.Com., LL.B., FCA, DISA(ICA), CIA(USA), ACFE --- which would sure shot help u to score well marks.

Or click here to download: http://www.box.net/shared/qfbgsa7vyf

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Wednesday, February 10, 2010

Import & export rate for the month of January & February (Issued by custom authorities)

Click at the below mentioned link to download
January Rates: Exchange rates

February Rates: Exchange rates

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Wednesday, February 3, 2010

CA Results Analysis

RESULT ANALYSIS OF CHARTERED ACCOUNTANTS PROFESSIONAL EDUCATION ( EXAMINATION-II) , PROFESSIONAL COMPETENCE AND INTEGRATED PROFESSIONAL COMPETENCE EXAMINATIONS HELD IN NOVEMBER-2009

The results of the Chartered Accountants Professional Education Examination-II (PEE-II) ,Professional Competence(PCE) and Integrated Professional Competence Examinations(IPCE) were declared recently.
The details of percentage of candidates passed in the above said examinations are given below:

EXAMINATION	GROUP	No.of candidates appeared	No.of candidates passed	% of pass
PEE-II	Both Group	3407	43	1.26
	Group – I	7025	682	9.71
	Group - II	9191	525	5.71

EXAMINATION	GROUP	No.of candidates appeared	No.of candidates passed	% of pass
PCE	Both Group	37661	5810	15.42
	Group – I	46955	12053	25.66
	Group - II	58180	15275	26.25

EXAMINATION	GROUP	No.of candidates appeared	No.of candidates passed	% of pass
IPCE	Both Group	7601	844	11.10
	Group – I	25587	2942	11.50
	Group - II	7737	1038	13.42

Tuesday, February 02, 2010
	Ministry of Corporate Affairs
	THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA DECLARES RESULTS OF PROFESSIONAL EDUCATION EXAMINATION ( PEE-II ), PROFESSIONAL COMPETENCE EXAM ( PCE ), AND INTEGRATED PROFESSIONAL EDUCATION EXAMINATION ( IPCE )
	17:52 IST

	The Institute of Chartered Accountants of India ( ICAI ), functioning under the aegis of Ministry of Corporate Affairs, here today announced the results of Professional Education Examination ( PEE- II ), Professional Competence Exam (PCE ) and Integrated Professional Education Examination ( IPCE ) held in November, 2009. In the PEE- II Shri Avinash Karwa of Solan ( H.P.) topped by scoring 64.5%. Shri Nafih Omer of Dubai ( UAE ) came second and Kumari Isha Sen of Allahabad has been placed third. Kumari Rupali Gupta of Jaipur topped the PCE by scoring 76 % , whereas Kumari Lakshami Niranjani G. of Coimbatore came second with 74.5 %. Shri Nitin Naraindas Wadhwani of Ulhasnagar has been placed third with 73.5 %. In the IPCE Kumari Amita Maheshwari of Jodhpur was placed first by scoring an impressive 77 %. Second place was achieved by Kumari Bhumika Rajiv Shah of Mumbai by scoring 75 % , whereas Kumari Sonam Bhandari of Howrah with 74.14 % came third. The Chartered Accountancy Examination is held twice every year. The Curriculum of the Chartered Accountancy Course has been designed, developed and maintained in such a way that the members of the Profession can become the valued Trustees of the World Class Financial Competence, Good Governance and Competitiveness. ------------------ KKP/ska

__._,_.___

Monday, February 1, 2010

Friends annoyed refreshing website for CA Results---here its gets directly refreshed

Friends you may b Anoyed refreshing ICAI website 4 results then visit http://taxpertstudents.blogspot.com/ page gets refreshed Automatically

Best of luck for the results.

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Friday, January 29, 2010

Supplementary Study Paper for PCC/IPCC and CA Final May and Nov 2010 students

Supplementary Study Paper for PCC/IPCC and CA Final Students May and Nov 2010 Exams

Hereby i m attaching herewith the link to download the Supplementary Study paper

PCC/IPCC: http://www.box.net/shared/u16un066ij

CA Final: http://www.box.net/shared/7udnv1g3vp

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FBT ADJUSTMENT AGAINST ADVANCE TAX-CBDT CIRCULAR

CIRCULAR NO

2/2010, Dated: January 29, 2010

Sub: Adjustment of “Advance Tax in respect of Fringe Benefits” for Assessment Year 2010-11 against “Advance Tax” – matter regarding.

The Finance Act, 2005 introduced a levy namely Fringe Benefit Tax (FBT) on the value of certain fringe benefits as contained in Chapter XII H (Sections 115 W to 115 WL) of Income Tax Act, 1961. By the Finance (No. 2) Act, 2009 a new Section 115 WM was inserted to abolish the FBT with effect from Assessment Year (A.Y.) 2010-11. Consequently, benefits given to employees are taxed as perquisites in the hands of employees in terms of amendments to Clause 2 of Section 17 of Income Tax Act, 1961. However, during the current Financial Year 2009-10 some assessees have paid “advance tax in respect of fringe benefits” for Assessment Year 2010-11. In such cases the Board has decided that any installment of “advance tax paid in respect of fringe benefits” for A.Y. 2010-11 shall be treated as Advance Tax paid by assessee concerned for A.Y. 2010-11. The assessee can adjust such sum against its advance tax obligation in respect of income for A.Y. 2010-11 or in case of loss etc claim such payment as refund as advance tax paid in A.Y. 2010-11.

2. This circular may be brought to the notice of all officers in the field for compliance.

Hindi version to follow

F. N0.385/05/2010-IT (B)

(Ansuman Pattnaik)
Director (Budget)

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Thursday, January 21, 2010

Results of the Chartered Accountants PE–II, PCE and IPCE held in November, 2009 are likely to be declared on Friday, the 29th January, 2010 around 2 P.M. - (21-01-2010)

January 21, 2010
The results of the Chartered Accountants Professional Education – II, Professional Competence Examinations and Integrated Professional Competence Examination held in November, 2009 are likely to be declared on Friday, the 29th January, 2010 around 2 P.M. and the same as well as the merit list (candidates securing a minimum of 55% and above marks and upto the maximum of 50th Rank) on all India basis will be available on the following website:

http://www.caresults.nic.in

Arrangements have also been made for the students desirous of having results on their e-mail addresses to pre-register their requests at the above website, i.e., http://www.caresults.nic.in from 22nd January, 2010. All those registering their requests will be provided their results through e-mail on the e-mail addresses registered as above immediately after the declaration of the result.

Further facilities have been made for students of Professional Education – II, Professional Competence Examinations and Integrated Professional Competence Examination held in November, 2009 desirous of knowing their results with marks on SMS. The service will be available through MTNL, India Times and Reliance.

For getting results through message students should type:

i) for Professional Education - II Examination result the following

CAPE2(Space)XXXXX (Where XXXXX is the five digit PE II examination roll number of the candidate)

e.g. CAPE2 00171

ii) for Professional Competence Examination result the following

CAPCE(Space)XXXXX (where XXXXX is the five digit PCE examination roll number of the candidate)

e.g. CAPCE 00197

iii) for Integrated Professional Competence Examination result the following

CAIPCE(Space)XXXXX (where XXXXX is the five digit IPCE examination roll number of the candidate)

e.g. CAIPCE 00297

and send the message to:

52001 - for DOLPHIN AND TRUMP users only

58888 - for all mobile services - India Times

51234] - for Reliance subscribers (Also accessible through R-World and Voice Portal – To call 51234815 from Reliance Mobiles)

(G. SOMASEKHAR)
ADDITIONAL SECRETARY (EXAMS.)

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Saturday, January 16, 2010

Useful Presentations - Tax and Allied Aspects of Construction Industry

---------- Forwarded message ----------

From: Rebecca Andrews <rebecca.andrews88@yahoo.in>
Date: Sat, Jan 16, 2010 at 12:08 PM
Subject: Useful Presentations - Tax and Allied Aspects of Construction Industry
To:

Click Here to download the files: http://www.box.net/shared/al9sgpbfvj

I am pleased to forward Power Point Presentations at Chamber of Tax Consultants on 9th January 2010, on following Topics :

1. Accounting Standards Applicable to
Construction Industry by Jayant Gokhale

2. PRECAUTIONS FOR PURCHASE AND ACQUISITION OF PROPERTY
By SHAILESH S. VAIDYA, PARTNER, KANGA AND COMPANY,
ADVOCATES AND SOLICITORS.

3. Construction & Works Contracts (Service Tax) by Sunil Gabhawala

Kind regards,

Rebecca Andrews

14th January,2010
Dear Members,

Please find attached herewith Presentations given by CA. Jayant Gokhale, CA. Sunil Gabhawalla and Shri Shailesh Vaidya Solicitor at the Two Days Conference on "Tax and Allied Aspects of Construction Industry" held on 8th & 9th January, 2010 at J. W. Marriott Hotel, Juhu, Mumbai - 400 049.

Thanks & Regards,

For THE CHAMBER OF TAX CONSULTANTS

Sd/-

SUNIL RAMANI
CHAIRMAN
ADVANCE REFRESHER COURSE COMMITTEE

Encl : As above

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Wednesday, January 13, 2010

TDS | Payments to Contractors (Sec 194C) -- covering most of the circulars

Under the Indian Income Tax Act, the following provisions relate to the
Tax Deduction at Source from payments to Contractors and Subcontractors
under section 194C.

Person responsible for paying
any sum for carrying any work to any resident
contractor should deduct tax at source.

Tax
should be deducted at source only if the contract is between the
contractor and the following specified persons:

1. The Central Government or any State Government.

2. Anylocal authority.

3. Any corporation established by or under a Central, State or Provincial Act

4. A company

5. Any Co-operative Society.

6. Any authority, constituted in India by or under any law, engaged either for the purpose of dealing with and satisfying the need for housing accommodation or for the purpose of planning, development or improvement of cities, towns and villages, or for both.

7. Any Society registered under the Societies Registration Act, 1960 or any
law corresponding to that Act in any part of India.

8. Any Trust.

9. Any University established by or under any Central, State or Provincial Act
or any institution declared to be a University under the University
Grants Commission Act.

10.Any firm.

11.Any individual or Hindu Undivided Family whose books are required to be
audited under section 44AB during the immediately preceding financial
year. [The turnover from business/profession exceeds the limits
specified u/s 44AB during the immediately preceding financial year].

Note: Budget 2008 introduced the burden of
deduction of tax under this section to Association of Persons and Body
of Individuals also, whether they are incorporated or not.

Individual or HUF need not deduct tax if the contract is exclusively for personal
purposes.

Income Tax should be deducted at the time of payment or credit to the account of the contractor whichever is earlier.

Income Tax is to be deducted at source @ 1% on Advertising contracts and @2% on any other contracts on the amount paid/credited. In the case of sub-contracts, the main
contractor should deduct tax at source @1% on the amount paid/credited
to the subcontractor.

Provisions of Section 194C are applicable only where the contract is either a “contract for carrying out any work” or a “contract for supply of labour for works contract”. Hence, these provisions are not applicable for payments made under the contract of sale of goods.
For the purpose of this section, the following contracts are also
included in the scope of “Work”:

1. Advertising.

2. Broadcasting
and telecasting including production of programs for broadcasting and
telecasting.

3. Carriage
of goods and passengers by any mode of transport other than Railways.

4. Catering.

No deduction of tax at source shall be made under this section in the
following circumstances:

1. If the amount paid/payable or credited/likely to be credited to the
contractor/sub-contractor does not exceed Rs.20,000/-
in a single instance. However, the total of amounts paid or credited
during the financial year should not exceed Rs.50,000/-.
If the said amount exceeds Rs.50,000/-, then, the liability for payment
arises on the whole of amount paid or credited and not on the amount in
excess of Rs.50,000/-

2. In the case of a sub-contractor who is a resident individual and who owns
not more than two goods carriages during the previous year, no tax
shall be deducted at source during the course of business of plying,
hiring or leasing goods carriages if he provides a declaration to the
person responsible for payment to that effect in the prescribed form.
[Form 15-I]

Income Tax is to be deducted on the amount of payment/credit and not on the
income part of the amount.

In a case where advance payments are made in pursuance of contract to be
adjusted against work to be done, tax has to be deducted at the time of
the advance payments.

The provisions of Sec 194C does not apply to payments made to Airlines or
travel agents for the purpose of travel of individuals even though the
payment/credit is made by the specified persons. But, if the aircraft
is chartered for carriage of passengers or goods, this section shall be
applicable. [Circular No.713 dt.2-8-1995 and No.715 dt.8-8-1995]

In the case of advertising
contracts, tax needs to be deducted only when the client makes payment
to the advertising agency and not when the advertising agency makes
payment to the media (includes both print and electronic media).
[Circular No.715 dt.8-8-1995]

If there is a consolidated bill given by advertising agencies which may include artwork charges etc apart from advertising charges, the rate applicable is 1% on the whole.
Tax is to be deducted on the gross amount of the bill (including the portion of media bill) and not on the commission of the advertising agency. But, payments made to Doordarshan
(Now Prasar Bharati) are not subject to TDS since it is a government agency and hence, not liable to income tax.
[Circular No.715 dt.8-8-1995].

The contract for putting up a hoarding is an advertising contract and hence, is covered under section 194C. [Circular No.715 dt.8-8-1995]

But, if a particular space has been taken on rent by a person who subsequently sub lets it for putting up a hoarding, the TDS liability is not under Section 194C but under section 194-I. [Circular No.715 dt.8-8-1995]

In the case of sponsorship for debates, seminars and other functions held in colleges, schools and associations with a view to earn publicity through display of banners,
etc., put up by the organisers, the agreement of sponsorship is in essence an agreement for carrying out a work of advertisement. Therefore, provisions of section 194C
will apply. [Circular No.715 dt.8-8-1995]

Tax is deductible at source on payments for costs of advertisements issued in the souvenirs brought out by various organisations.
[Circular No.715 dt.8-8-1995].

Payments to Clearing and Forwarding agents for carriage of goods are subject to TDS. The Clearing and Forwarding agents themselves are also liable to deduct tax
on payments to a carrier of goods. [Circular No.715 dt.8-8-1995]

Payments to couriers are also covered u/s 194C because the carriage of documents, letters etc is in the nature of carriage of goods. [Circular No.715 dt.8-8-1995]

In the case of payments to transporters, each GR can be said to be a separate contract, if the goods are transported at one time. But if the goods are transported
continuously in pursuance of a contract for a specific period or
quantity, each GR will not be a separate contract and all GRs relating to that period or
quantity will be aggregated for the purpose of TDS. Even when the goods
are received on ‘freight to pay’ basis, the TDS provisions would be
applicable, irrespective of the actual payment. [Circular No.715
dt.8-8-1995].

TDS is not required to be made when payment is made for serving food in a restaurant in the normal course of business of the restaurant. [Circular No.715 dt.8-8-1995].

Payments to recruitment agencies are in the nature of payment for services rendered and not for carrying out any work. Hence, they are not covered under section 194C.
However, such payments are liable to TDS under section 194J. [Circular
No.715 dt.8-8-1995].

The provisions of Section 194C
would apply in case of supply of any article or thing as per prescribed
specifications only if it is not a contract for sale. [Circular
No.13/2006 dt.13-12-2006].

Electrical contracts,
maintenance contracts are covered by Section 194C. If any technical
services are rendered, such payments would be covered under Section
194J. [Circular No.715 dt.8-8-1995].

Since Section 194C refers to
“any sum paid”, if the bill contains reimbursement of expenses also,
the TDS is applicable on the reimbursements also. [Circular No.715
dt.8-8-1995]. However, if there are separate bills for contract
payments and reimbursement of expenses, then, TDS is not required to be
made on reimbursement of expenditure.

Rendering of services for procurement of orders is not covered by Section 194C. [Circular No.715 dt.8-8-1995].

In case of payments made to cold storages, thecustomer is not given any right to use any demarcated space/place or the machinery of the cold store and thus does not
become a tenant. Therefore, the provision of 194-I is not applicable to
the cooling charges paid by the customers of the cold storage. However,
since the arrangement between the customers and cold storage owners are
basically contractual in nature, the provision of section 194-C will be
applicable to the amounts paid as cooling charges by the customers of
the cold storage. [Circular No.1/2008 dt.10-1-2008].

Disclaimer: All the information provided above is for informative purposes only. You are advised to consult your tax consultant before you act upon any of the above information. In spite of this, if any person acts upon this information and suffers any loss, we are not to be held liable.

Though all efforts have been made to provide latest information, you are advised to check latest circulars, latest changes in law etc from the Indian Income Tax Department.

Result of the Information Systems Audit [ISA] Assessment Test held on 19th December, 2009 is likely to be declared on 17th January, 2010 around 2.00 PM - (13-01-2010)

12th January, 2010
The result of the Information Systems Audit [ISA] Assessment Test held on 19th December, 2009 is likely to be declared on 17th January, 2010 around 2.00 PM at the Institute’s office at New Delhi.

The result of the above Assessment Test will be available on the Institute’s website www.icai.org

(G. SOMASEKHAR)
ADDITIONAL SECRETARY (EXAMS)

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ICAI launched facility to post your Grievance online

ICAI - e-Samadhaan (The ICAI Helping Hand), Grievance Resolution Management System, For more details click on below:- http://www.icai.org/help/

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Friday, January 8, 2010

Results of the Chartered Accountants Final and Final (New Course) Examinations held in November, 2009 and Common Proficiency Test (CPT) held in December, 2009 are likely to be declared on Sunday, the 17th January, 2010 around 2:00 PM - (08-01-2010)

January 7, 2010

The results of the Chartered Accountants Final and Final (New Course) Examinations held in November, 2009 and Common Proficiency Test (CPT) held in December, 2009 are likely to be declared on Sunday, the 17th January, 2010 around 2:00 PM and the same as well as the merit list (candidates securing a minimum of 55% and above marks and upto the maximum of 50th Rank in the case of Final Examination and candidates securing a minimum of 60% and above marks and upto the maximum of 10th Rank in the case of Common Proficiency Test) on all India basis will be available on the following website:

http://www.caresults.nic.in

Arrangements have also been made for the students of Final, Final (New Course) Examinations and Common Proficiency Test (CPT) desirous of having results on their e-mail addresses to register their requests at the above website, i.e., http://www.caresults.nic.in from 11th January, 2010. All those registering their requests will be provided their results through e-mail on the e-mail addresses registered as above immediately after the declaration of the result.

Further facilities have been made for students of Final, Final (New Course) Examinations and Common Proficiency Test (CPT) held in November/December, 2009 desirous of knowing their results with marks on SMS. The service will be available through MTNL, India Times and Reliance.

For getting results through the message students should type:

i) for Final Examination result the following

CAFNL(space)XXXXX (Where XXXXX is the five digit Final examination roll number of the candidate)

e.g. CAFNL 00028

ii) for Final (New Course) Examination result the following

CAFNLNW(space)XXXXX (Where XXXXX is the five digit Final (New Course) examination roll number of the candidate)

iii) for Common Proficiency Test result the following

CACPT(Space)XXXXXX (Where XXXXXX is the six digit Common Proficiency Test roll number of the candidate

e.g. CACPT 000171

and send the message to:

52001 - for DOLPHIN AND TRUMP users only

58888 - for all mobile services - India Times

51234] - for Reliance subscribers (Also accessible through R-World and Voice Portal – To call 51234815 from Reliance Mobiles)

(G. SOMASEKHAR)
ADDITIONAL SECRETARY (EXAMS.)

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Fringe benefit tax to hit employees with company cars

The new perquisite rules have been notified and are applicable from April 1,2009, for the current financial year. There is significant difference in respect of the taxability of the car benefit under the Fringe Benefit Tax (FBT) regime vis-à-vis the perquisite taxation.

FBT regime

Under FBT, a fringe benefit was deemed to have been provided by the employer to its employees for the expenditure incurred and/or payment made for repair, running (including fuel), maintenance of the motor car and the depreciation thereon. Therefore, irrespective of whether the car was owned by the employer or by the employee, the expenditure incurred by the employer or the expense reimbursed to the employee was subject to FBT.

Twenty per cent of such expense incurred/reimbursed was considered to be the fringe benefit, which was liable to tax at 30% plus surcharge and cess, as applicable. Hence, the effective tax on the expenditure incurred used to be 7% approximately of the expenditure incurred.

New perk rules

Under the new perquisite rules, a distinction is to be made between the car owned by the employer and the car owned by the employee, as the value of the tax perquisite in the two scenarios varies considerably. Even though there could be different permutation and combination, under which the car benefit could be provided by the employer to the employee, this article primarily focuses on two scenarios where the car is either owned by the employer or employee and the car expenses are met/reimbursed by the employer.

Car provided by the employer

Where the car is owned or hired by the employer and is used wholly and exclusively in the performance of official duties, no perquisite value is to be determined.

If such a car is used exclusively for the private or personal purposes, the actual expenditure incurred by the employer as increased by the amount representing normal wear and tear, would be treated as perquisite value.
In practice, generally, a car is provided for both official and personal use. In that case, the perquisite value is to be determined as Rs 1,800 per calendar month where the cubic capacity of the engine does not exceed 1.6 litre and Rs 2,400 where it exceeds 1.6 litre. In case a chauffeur is provided, Rs 900 is to be added to the aforesaid perquisite value.

EMployee-owned cars

Where the employee owns the car but the actual repair, running and maintenance expenses are met or reimbursed by the employer and such car is used wholly and exclusively for official purposes, then there would be no perquisite value. However, where such a reimbursement is for both official and personal purposes, the perquisite value is to be determined as the actual amount of expenditure incurred by the employer less than Rs 1,800/Rs 2,400, depending on the cubic capacity and Rs 900 if a chauffeur is provided.

Employee-owned cars lose shine

Therefore, it is pertinent to note that while under FBT regime in both the scenarios, the tax impact was similar, however, the perquisite value and the corresponding tax could be significantly more in case the car is owned by the employee while expenses are met by the employer for use of car for both official and personal purpose. This is particularly an area of concern as in the instant case, the reimbursements have been made from April till date and would now need to be covered under the new perquisite rules and taxed accordingly. Thus, this tax needs to be withheld from January-March salary for the entire year.

Further, cars provided by the employer to employee for both official and personal purposes do look more attractive now as part of overall compensation strategy.

Vikas Vasal, Executive Director, KPMG
Source: Economic Times

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Cos to get fringe benefit from Q4 advance tax

The government will allow companies to adjust the fringe benefit

tax (FBT) paid by them against the advance tax due in the March
quarter,
reducing the hazard of claiming a refund and slightly improving profits at a time of rising costs, said an income-tax department official.

“The Central Board of Direct Taxes has taken an in-principle decision to allow corporates to adjust FBT paid in the first quarter against their advance tax,” he said.

Finance Minister Pranab Mukherjee in his July 2009 Budget scrapped FBT, seen by many as more of a trouble than of help, in significantly raising the government’s revenues. But corporates have paid in advance, a portion of the tax due, in the first quarter that ended in June. It was replaced with a perquisites tax on employees receiving such benefits. FBT, introduced by former finance minister P Chidambaram in 2005, is a kind of a presumptive tax on expenditure incurred by a company on its employees.

Under FBT, some of the benefits such as travel and hotel stay given by an employer to the staff are deemed to be fringe benefits and taxed accordingly. Companies had to pay a 20% tax on such expenses.

A circular will soon be issued clarifying the issue on the adjustment, said the official who did not want to be identified. The government has so far collected about Rs 2,000 crore in the current financial year through the levy, he said.

Just like the corporate advance tax, FBT also had to be paid in four instalments in June, September, December and March.

However, loss-making companies and others such as liaison offices of foreign companies, which do not otherwise have a tax liability, will have to claim a refund.

Although the decision may not add significantly to profits, it could bring in a slight relief for corporates.

It is not yet clear how the individual salaried taxpayers who have paid FBT for gains such as employee stock options (Esops) will adjust it.

Source: Economic Times

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Monday, January 4, 2010

Blog opened specially devoted to CA,CS and ICWAI students

Friends,

Blog specially devoted for CA,CS and ICWAI students is opened which can be accessed at
http://taxpertstudents.blogspot.com/

The blog is at a testing stage so if you encounter any problem please let us know at email:taxpertindia@gmail.com

As a kind of 1st installment as promised i have uploaded PCC NOV 2009 papers
click here to go to that post: http://taxpertstudents.blogspot.com/2010/01/nov-2009-papers.html

IF you have any kind of papers of CA,CS and ICWAI exams which you wud like to share then send us at
EMAIL: taxpertindia@gmail.com

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