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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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 1.FOLLOW US ON TWITTER CLICK HERE: http://twitter.com/taxpertindia 2.Posted www.taxpertindia.blogspot.com 3.Get Tax updates from my blog through by joining my google group CA_taxmannindia:http://groups.google.co.in/group/ca_taxmannindia?hl=en 5.Get Free Quality SMS updates from my blog on your MOBILE:http://labs.google.co.in/smschannels/subscribe/ca_taxmannindia OR Send a message JOIN ca_taxmannindia to 9870807070 thru ur mobile nd receive updates

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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.

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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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Govt Said that UTN no. is scrapped which was to come on 01.01.10

The government has decided to shelve the introduction of the Unique Transaction Number (UTN) which tax payers need to quote along with Permanent Account Number (PAN) when tax is deducted/collected at source. The scheme was to have come into force from the New Year.

However, the finance ministry has not ruled out the possibility of introducing a new identity number like UTN from the next fiscal, in addition to the PAN to ensure prompt verification and granting of tax credits to tax payers.

“The introduction of UTN, which was scheduled to be implemented from January 2010, has been shelved in all probability . The process of filing tax returns remains the same as earlier,” a finance ministry official said.

A similar arrangement of having a new identity number is under contemplation but it would only happen from the next fiscal, the official said.

The government had earlier said the system of allotting UTN is expected to become operational by January 1, 2010.

The move to introduce UTN had invited concerns from tax payers as it would have brought in a slew of formalities for the tax payers, through their respective collectors and deductors, to avail the new number and file their returns on time.

The decision to shelve the UTN has been taken keeping in mind the approaching end of the fiscal year. Moreover , the exercise to have a new identity number like PAN is huge and it would have brought a lot of complications for tax payers, the finance ministry official said.

The Central Board of Direct Taxes (CBDT) had deferred UTN’s introduction to June 30 this year saying, “taxpayers filing their income tax returns for assessment year 2009-10 or any other earlier assessment year, may continue to file their returns without mentioning the Unique Transaction Number (UTN).”

The CBDT in a circular earlier said the new number (UTN) is mandatory for filing tax returns due to certain lacunae like individuals having more than one PAN.

The income-tax department was also in touch with the National Securities Depository (NSDL) regarding future steps to be taken for “putting in place” a new system for UTN.

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New Perquisite Rules Notified dated: 18.12.09

THE much-awaited perquisite valuation rules have finally been notified by the CBDT. The Board has amended Rule 3 to give effect to the abolition of FBT, announced in the Budget 2009. Vide Income Tax (13th) Amendment Rules, the Board has notified the new valuation guidelines w.e.f April 1, 2009 for the AY 2010-11.

You can Download this notification click here:http://www.box.net/shared/8oqh6xp1oh

INCOME-TAX (THIRTEENTH AMENDMENT) RULES, 2009 - SUBSTITUTION OF RULE 3 AND INSERTION OF RULE 40F

Notification No. 94/2009/F.NO. 142/25/2009-SO (TPL), dated 18-12-2009

In exercise of the powers conferred by section 295 read with sub-section (2) of section 17 of the Income-tax Act, (43 of 1961). The Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namlely :-

(1) These rules may be called the Income-tax (13th Amendment) Rules, 2009.
(2) They shall be deemed to have come into force on the 1st day of April, 2009.

In the Income-tax Rules, 1962, for rule 3, the following shall be substituted, namely: -


"3. For the purpose of computing the income chargeable under the head "Salaries", the value of perquisites provided by the employer directly or indirectly to the assessee (hereinafter referred to as employee) or to any member of his household by reason of his employment shall be determined in accordance with the following sub-rules, namely:—

(1) The value of residential accommodation provided by the employer during the previous year shall be determined on the basis provided in the Table below:

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A very good presentation on Tax audit issues

A very good presentation on Tax audit issues 

It covers Following subjects
1.Turnover/Gross Receipts meaning for various types of assessee
-In case of a day trader/speculator
-In case of security derivatives transactions
-In case of commodity derivatives transactions
-In case of a clearing & forwarding agent
-In case of a multimodal transport operator
-In case of travel agent, where no commission is payable by airlines
-In case of an advertising agency booking space
-In case of a construction contractor
-In Case of Partner of Partnership firm

2.Tax Audit in case of Charitable Trust

3.Format of Report & Accounts

4.Important clauses, section & guidance notes of institute

5.Clause 17(a) - Software –Capital or Revenue Expenditure?

6.Clause 17(f) & 27 – TDS r.w.s. 40(a)(ia)


7.CBDT Instruction No.9/2008 dated 31.7.2008 

Just click here to download: http://www.mediafire.com/download.php?xwmnowee1zk
 
(This are the materials provided at the lecture meeting in BCA'S seminar)

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Very Good Presentation on DTC Code bills

I Am uploading herewith some of the good presentation on Direct tax code bill (Topic wise)

Just click on the below mentioned link to download:-

 1.TAX IMPLICATIONS ON FOREIGN ENTITIES AND TDS ON PAYMENTS TO NR
http://www.mediafire.com/download.php?ztmv42wwiw0

2.NPOs, Unincorporated Bodies, Financial
http://www.mediafire.com/download.php?mkojewlttmz

3.Business Reorganisation GAAR
http://www.mediafire.com/download.php?iznmajidily

4.DTC Anti-avoidance Rules
http://www.mediafire.com/download.php?tjydmjnnz3a

(This are the materials provided at the lecture meeting in BCA'S seminar)

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Applicability of provisions under section 194J of Income Tax Act' 61 in the case of transactions by the Third Party Administrators (TPAs) with hospitals etc.

CIRCULAR NO

8/2009, Dated: November 24, 2009

Sub: Applicability of provisions under Section 194J of Income Tax Act'61 in the case of transactions by the Third Party Administrators (TPAs) with Hospitals etc.

A number of representations have been received from various stakeholders regarding applicability of provisions under Section 194J of Income Tax Act'61 on payments made by Third Party Administrators (TPAs) to hospitals on behalf of insurance companies for settling medical/insurance claims etc with the hospitals.

2. The matter was examined by the Board. As per provisions of section 194J (1) ‘Any person, not being an individual or a Hindu undivided family, who is responsible for paying to a resident any sum by way of—

( a ) fees for professional services, or

( b ) fees for technical services, [or]

[( c ) royalty, or

( d ) any sum referred to in clause ( va ) of section 28 ,]

shall, at the time of credit of such sum to the account of the payee or at the time of payment thereof in cash or by issue of a cheque or draft or by any other mode, whichever is earlier, deduct an amount equal to ten per cent of such sum as income-tax on income comprised therein …”. Further as per Explanation (a) to 194J “professional services” means services rendered by a person in the course of carrying on legal, medical, engineering or architectural profession etc.. ' .

3. The services rendered by hospitals to various patients are primarily medical services and, therefore, provisions of 194J are applicable on payments made by TPAs to hospitals etc. Further for invoking provisions of 194J, there is no stipulation that the professional services have to be necessarily rendered to the person who makes payment to hospital. Therefore TPAs who are making payment on behalf of insurance companies to hospitals for settlement of medical/insurance claims etc under various schemes including Cashless schemes are liable to deduct tax at source under section 194J on all such payments to hospitals etc.

3.1. In view of above, all such past transactions between TPAs and hospitals fall within provisions of Section 194J and consequence of failure to deduct tax or after deducting tax failure to pay on all such transactions would make the deductor (TPAs) deemed to be an assessee in default in respect of such tax and also liable for charging of interest under Section 201 (1A) and penalty under Section 271C.

4. Considering the facts and circumstances of the class of cases of TPAs and insurance companies, the Board has decided that no proceedings u/s 201 may be initiated after the expiry of six years from the end of financial year in which such payment have been made without deducting tax at source etc by the TPAs. The Board is also of the view that tax demand arising out of Section 201 (1) in situations arising above, may not be enforced if the deductor(TPA) satisfies the officer in charge of TDS that the relevant taxes have been paid by the deductee assessee (hospitals etc.). A certificate from the auditor of the deductee assessee stating that the tax and interest due from deductee assessee has been paid for the assessment year concerned would be sufficient compliance for the above purpose. However, this will not alter the liability to charge interest under Section 201 (1A) of the Income Tax Act till payment of taxes by the deductee assessee or liability for penalty under Section 271C of the Income Tax Act as the case may be.

5. The contents of the circular may be brought to the notice of officers and officials working under you for strict compliance.

Hindi version will follow

F.No. 385/08/2009-IT(B)

(Ansuman Pattnaik)

Director (Budget)

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Auto Registration of PAN for Form 26AS

NSDL introduces a new system of Form 26AS registration, wherein it eases the complete process for employees in the organization. In this program, NSDL will automatically register the PAN and provide the password to PAN Holder.

The process
In this process, NSDL will approve the organization to place a request for PAN registration. On such approval, the organization has to submit the list of employees for Form 26AS, along with their Valid PAN and Valid Email ID. Once NSDL receives such data, it will communicate to every employee over email and takes the confirmation for Form 26AS creation. On receipt of confirmation from Employee, NSDL will automatically create a login along with password and communicates it confidentially over the email. Employee has to login to such account with minimum days specified and activate the account.

Eligibility
To begin with, NSDL is analyzing the organizations to place such request. Initially it would be for large companies listed in Stock Exchanges. Also such companies should have quite huge number of employees. Such companies may also be assessed with other criteria, including employee count in TDS statements, etc and once it is satisfied, organization will be approved for placing such request.

The process may also be later extended with more organizations covered under the scheme. Organizations which are listed in stock exchanges and have got huge number of employees can also contact NSDL voluntarily and ask for more information.

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Section 132 of the Income-tax Act, 1961 – Search & seizure – Empowerment of authorities

Section 132 of the Income-tax Act, 1961 – Search & seizure – Empowerment of authorities toNotification No. 82/2009/F.NO.142/23/2009-SO(TPL)(Pt.), dated 11-11-2009



In exercise of the powers conferred by the fourth proviso to sub-section (1) of section 132 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby empowers all the Additional Directors of Income-tax and Joint Directors of Income-tax working under the Director General of Income-tax (Investigation) and Director General of Income-tax (Intelligence) to issue authorisation under sub-section (1) of section 132 of the Income-tax Act, 1961 (43 of 1961).

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Section 10(6C) of the Income-tax Act, 1961 - Income arising to foreign company by way of fees for technical services - Notified companies

Section 10(6C) of the Income-tax Act, 1961 - Income arising to foreign company by way of fees for technical services - Notified companies

Notification No. 81/2009, dated 27-10-2009

In exercise of the powers conferred by clause (6C) of section 10 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby declares that any income arising to M/s BAE Systems (Operations) Limited, Warwick House, PO Box 87, Faraborough Aerospace Centre, Faraborough, Hampshire, GU14 6YU, United Kingdom and M/s Rolls Royce Turbomeca Limited, 4-5 Grosvener Place, London SW-1, England, by way of royalty or fees for technical services received in pursuance of the following contracts, shall not be included in computing the total income of the said companies under the said Act;-



(1) Direct Supply Contract - 24 Hawk Mk 132 AJT ac, Trg Aids, Fixed Spares, Flyaway packs, Supplementary Sparcs, Ferry of aircraft etc. Interim Flying Training of IAF pilots, training of a crew / maintenance crew and ferry of aircraft from UK to India, The total value of contract is £ 479,718,664.00 (Air HQ/S 96963/1/1/Proj(AJT)/Direct Supply Contract dated 26 Mar 04];

(2) Services to the 1AF in India Contract - The services are being provided by BAB Systems includes Technical support in India, Technical Training in India, Commissioning of Training Aids and Commissioning of the Avionics Ground Test Facility. The total value of the contract is £ 6,745,641.00 [Air HQ/S 96963/1/2/Proj(AJT) /Services Contract for services to the 1AF in India dated 26 Mar 04]; and

(3) EFRC Contract - Qty 70 electronic Flight Reference Cards for display of emergency actions of Murti Function Display (MFD) of Hawk Mk 132 AJT aircraft. The total value of the contract is £7,757,610.00 [Air HQ/S 96957/3/3/Proj(AJT)/EFRC dated 14 Feb 07 Contract for Qty 70 EFRC].



[F.No.200/48/2004-ITA-I]


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NEW TDS rate chart applicable from 1st october 2009 (Rectified)

Enclosing herewith the new tds rate chart effective from 01.10.2009 (rectified)

I regret the error and after verfiying from the finance bill
Interest other than interest on securites (sec 194A) when recipent is a company the TDS rate was shown as 10% and it is correct and so was uploaded first

Just click here to download the tds rate chart
http://www.ziddu.com/download/7049526/TDSRATECHART.pdf.html
THE ERROR IS REGRETTED
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Revised procedure for acceptance of proof Address.(PAN)

Kindly go through the revised procedure for acceptance of proof Address.
>
> AS per the circular no 321 the additional procedure for acceptance of proof
> of address alongwith PAN applications received from Individuals and HUF are
> as under:
>
> 1. While accepting “Application for allotment of PAN (Form 49A)” if both
> the addresses (residence and office) are mentioned in the application form
> and office address has been selected as communication address, then POA has
> to be collected for residence as well as office address.
>
> 2. While accepting “Request for New PAN card or/and changes or
> correction in PAN data” applications, proof of all addresses provided in the
> application have to be collected.
>
> 3. Documents as per Rule 114(4) of Income Tax Rules will only be
> accepted as valid proof for both the abovesaid addresses.
>
> 4. Both proof of addresses will have to be in the name of applicant and
> should contain the name in the expanded form as given in the application.
> The exception provided for ration card communicated vide our circular
> TFCID/TIN/08/255 dated February 18, 2008 will continue to be applicable.
>
> We hereby informed that the above will be effective for all PAN applications
> received on or after November 1, 2009.

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Gifts of Property (Gifts-in-Kind) above Value of Rs.50,000/- become Taxable from 1st October 2009

The Income Tax Act 1961 (the Act) has been amended with effect from 1st October 2009 to provide that any gift-in-kind, being an immovable property or any other property, the value of which exceeds Rs.50,000 /- (rupees fifty thousand), will become taxable in the hands of the donee, being an individual or a Hindu Undivided Family (HUF), as income from other sources under clause (vii) of sub-section 2 of section 56 of the Act.

Therefore, any such person who receives a gift of any such property on or after 1st October 2009 must pay the income tax due on the value of the gift and disclose the taxable value of such property in the return of income for assessment year 2010-11 and subsequent years.
The following types of gifts will, however, not be subject to tax, i.e. gifts

(a) from a person who is a relative;
(b) on the occasion of marriage of the individual;
(c) under a will or by way of inheritance;
(d) in contemplation of death of the donor;
(e) from any local authority as defined in the Explanation to section 10(20) of the Act;
(f) from any fund or trust established under section 10(23C) of the Act;
(g) from any trust or institution registered under section 12AA of the Act.
Relative is defined in the Act as

(i) spouse;
(ii) brother or sister;
(iii) brother or sister of the spouse;
(iv) brother or sister of either of the parents;
(v) any lineal ascendant or descendant;
(vi) spouse of any of the relative at clauses (ii) to (v); of the individual.

Gifts received from these relatives will not be subject to tax.

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REPRESENTATION MADE FOR EXTENSION OF DUE DATE FOR FILING THE RETURN OF INCOME - (23-09-2009)

Due to the fact that most of the establishments are virtually closed on account of festivals of Durga Pooja, Navratra’s and Dussehra, representations were received from members all over the country posing the difficulties faced by them in preparing and filing the return of income by due date. Hence, ICAI has made a representation to the Chairman, CBDT requesting him to extend the due date for filing the return of income u/s 139 (1) of the Income Tax Act, 1961 suitably.

 Further, ICAI has also suggested CBDT to request the Assessing Officers not to fix the cases near to the last date of filing return of income and where the cases are already fixed up the same may be adjourned to some later date. This request has been made since it has been noticed that a large number of cases have been fixed up by the Assessing Officers near to the last date of filing return of income which becomes burdensome for the assessees.

Sources:ICAI
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Notification No. 68, dated 15-9-2009 Section 35(1)(ii) of the Income-tax Act, 1961 - Scientific Research Expenditure - Approved Scientific Research Associations/Institutions

Section 35(1)(ii) of the Income-tax Act, 1961 - Scientific Research Expenditure - Approved Scientific Research Associations/Institutions



Notification No. 68, dated 15-9-2009



It is hereby notified for general information that the organization Sri Aurobindo Society, Kolkata has been approved by the Central Government for the purpose of clause (ii) of sub-section (1) of section 35 of the Income-tax Act, 1961 (said Act), read with Rules 5C and 5E of the Income-tax Rules, 1962 (said Rules), from Assessment year 2009-2010 onwards in the category of 'other Institution', partly engaged in research activities subject to the following conditions, namely:-

(i) The sums paid to the approved organization shall be utilized for scientific research;

(ii) The approved organization shall carry out scientific research through its faculty members or its enrolled students,

(iii) The approved organization shall maintain separate books of accounts in respect of the sums received by it for scientific research, reflect therein the amounts used for carrying out research, get such books audited by an accountant as defined in the explanation to sub-section (2) of section 288 of the said Act and furnish the report of such audit duly signed and verified by such accountant to the Commissioner of Income-tax or the Director of Income-tax having jurisdiction over the case, by the due date of furnishing the return of income under sub-section (1) of section 139 of the said Act;

(iv) The approved organization shall maintain a separate statement of donations received and amounts applied for scientific research and a copy of such statement duly certified by the auditor shall accompany the report of audit referred to above.



2. The Central Government shall withdraw the approval if the approved organization:-

(a) fails to maintain separate books of accounts referred to in sub-paragraph (iii) of paragraph 1; or

(b) fails to furnish its audit report referred to in sub-paragraph (iii) of paragraph 1; or

(c) fails to furnish its statement of the donations received and sums applied for scientific research referred to in sub-paragraph (iv) of paragraph 1; or

(d) ceases to carry on its research activities or its research activities are not found to be genuine; or

(e) ceases to conform to and comply with the provisions of clause (ii) of sub-section (1) of section 35 of the said Act read with rules 5C and 5E of the said Rules.

[F.No. 203/6/2009/ITA-II]


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Notification No. 69, dated 15-9-2009 Section 35(1)(ii) of the Income-tax Act, 1961 - Scientific Research Expenditure - Approved Scientific Research Associations/Institutions

Section 35(1)(ii) of the Income-tax Act, 1961 - Scientific Research Expenditure - Approved Scientific Research Associations/Institutions



Notification No. 69, dated 15-9-2009



It is hereby notified for general information that the organization Sastra University, Chennai has been approved by the Central Government for the purpose of clause (ii) of sub-section (1) of section 35 of the Income-tax Act, 1961 (said Act), read with Rules 5C and 5E of the Income-tax Rules, 1962 (said Rules), from Assessment year 2009-2010 onwards in the category of 'other Institution', partly engaged in research activities subject to the following conditions, namely:-

(i) The sums paid to the approved organization shall be utilized for scientific research,

(ii) The approved organization shall carry out scientific research through its faculty members or its enrolled students:

(iii) The approved organization shall maintain separate books of accounts in respect of the sums received by it for scientific research, reflect therein the amounts used for carrying out researcl get such books audited by an accountant as defined in the explanation to sub-section (2) of section 288 of the said Act and furnish the report of such audit duly signed and verified by such accountant to the Commissioner of Income-tax or the Director of Income-tax having jurisdiction over the case, by the due date of furnishing the return of income under sub-section (1) of section of the said Act;

(iv) The approved organization shall maintain a separate statement of donations received and amounts applied for scientific research and a copy of such statement duly certified by the auditor shall accompany the report of audit referred to above

2. The Central Government shall withdraw the approval if the approved organization:-

(a) fails to maintain separate books of accounts referred to in sub-paragraph (iii) of paragraph 1: or

(b) fails to furnish its audit report referred to in sub-paragraph (iii) of paragraph 1; or

(c) fails to furnish its statement of the donations received and sums applied for scientific research referred to in sub-paragraph (iv) of paragraph 1; or

(d) ceases to carry on its research activities or its research activities are not found to be genuine; or

(e) ceases to conform to and comply with the provisions of clause (ii) of sub-section (1) of section 35 of the said Act read with rules 5C and 5E of the said Rules.

[F.No. 203/58/2009/ITA-II]

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Taxpayers breathe easy after clarifications

Taxpayers breathe easy after clarifications
Some serious concerns on various issues relating to TDS, capital gains, taxing of insurance proceeds, NRIs and sunset provisions, which were raised by TOI’s Taxing Times columnist Mukesh Patel in the series under ‘Cracking the Code’ were deliberated at an interactive session on Saturday. Taxpayers heaved a sigh of relief after clarifications came from Joint secretary, Tax Policy and Legislation, Union Ministry of Finance, Arbind Modi. Here is how ambiguities were sorted out...
Concern: Current area and sector based tax incentives under Section 80 of the I-T Act will be continued under DTC only if the unit is operational by 31-3-2010.
Clarification: The benefit under the new Code will be allowed to all units operational by 31-3-2011.
Concern: Profit-linked incentives may not be available to current units to the same extent under the new Code for the unexpired period under the I-T Act.
Clarification: Deduction of profits, if available at 100% or the appropriate percentage, will be granted as such, under the principle of grandfathering for such unexpired period.
Concern: DTC drafting suggests that the benefit of Double Tax Avoidance Agreement (DTAA) would not be available at the time of TDS.
Clarification: There should be no apprehension in this regard. Such benefit will be duly allowed.
Concern: Under the scheme for presumptive taxation, there is no provision to allow deduction for partner’s interest or remuneration.
Clarification: This deduction will be duly provided for.
Concern: Valuation of assets under Wealth-tax may lead to litigation.
Clarification: Wealth-tax will be levied on assets, valuation of which will be done only at cost and not at market value.
Concern: The provision to tax ‘any sum received under a life insurance policy’ would mean that even the principal amount of premiums paid will become liable to Income-tax.
Clarification: DTC draft will be suitably amended, since the intent is to tax only the bonus received on maturity. Concern: No provision under DTC for filing declaration for no TDS in case of interest income, if the taxpayer does not have taxable income.
Clarification: Point well taken. Necessary provision will be made for such declarations as currently prevailing in form 15G and 15H.
Concern: No threshold limit (currently Rs.20,000) provided in regard to TDS from payment of professional fees.
Clarification: Suitable threshold limit will be duly provided under DTC.
Concern: Harsh consequences to arise on account of the new provision prescribing 10% TDS in respect of payments of ‘any other income.’ Clarification: This provision will be dropped.
Concern: Gains Tax on capital market gains will have a dampening effect. Clarification: If the sale consideration of any capital asset is rolled over by way of deposit in the new ‘Capital Gains Savings Scheme’ (CGSS) within 60 days, there will be no tax liability. Such deposit balance in CGSS can be invested in any fresh investment in debt or equity instruments as will be announced under the Scheme. Thus, as long as the gains are continued to be rolled over, there will be no effective tax liability. On the basis of the EET model, tax will get attracted only on withdrawal of any amount from the CGSS.
Concern: Drafting of the Code suggests that NRIs will not enjoy the benefit of even the minimum exemption limit of Rs.1,60,000 in respect of interest income and capital gains proposed to be taxed at the flat rate of 20% and 30%.
Clarification: this is not our intent. Hence, suitable amendment will be made to provide that NRIs will be taxed in the same tax slabs and as applicable to resident Indians.

This is a forwarded message received from deepak shah.
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Download your E-return acknowledgement-sent from the CPC bangalore

Friends

Now you can Download your E-return acknowledgement which is sent from the CPC bangalore

As people facing problem after enclosing wrong e-mail id in there income tax return while e-filling.
Now the department has started also uploading the ITR V acknowledgement "sent by the department thru mails at the individuals email id" at the income tax india e-filling site.

Now you can download the acknowledgement by following this route:
1. Login in the IT dept website
2.Then go to "MY ACCOUNTS"
3.now click on "E-Filling processing status"
as you click this you will see that it is said "ITR V received"
now click on ITR V received and you can easily download it.


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