PROFESSIONAL UPDATES FOR THE MONTH OF APRIL 2014, BY RAJPUT CONSULTANCY SERVICES PVT LTD. TEAM

• Provision for retirement benefit created on the basis of service weight age of an employee couldn't be allowed to be deducted as it was just a provision and could not be termed as gratuity fund or any other welfare fund under section 40A (9) [Commissioner of Income Tax, Coimbatore Vs. M/s. Pricol Ltd., Tax Case (Appeal) No. 343 of 2007, Date of Order: 01.04.2014, High Court of Madras].
• Mandatory E-Filing of ITR for A Y 2014-15 to every assessee except Individual and HUF having total income less than Rs 5 lakhs, subject to some conditions. 
• Detailed instructions have been issued by the CBDT to all the assessing officers laying down a Standard Operating Procedure (SOP) for verification and correction of demand by the AOs upto Rs. 1,00,000/- in the case of Individuals and HUFs.
• Government woman employee can get uninterrupted 2-years leave for child care [Supreme Court of India].
• In terms of section 2(22)(e), it is only person who is the registered shareholder who can be said to be a shareholder qua company and not a person beneficially entitled to shares [Chief Commissioner of Income Tax Vs. Sarva Equity (P.) Ltd., ITA Nos. 322 to 324 of 2012, date of order: 08.01.2014, High Court of Karnataka].
• Resident Individuals, Firms and Companies with forex exposure can book forward contracts up to USD 250000 with simple declaration [RBI Circular 119 of 07-04-2014].  
• The Commissioner VAT committed to traders for not taken coercive action for non-compliance of T-2 till 30-04-2014.  
• On the representation of the STBA, now column R-10 is no longer required to be filled for details of statutory form of 2011-12 in March-14 VAT Return.  
• Detailed instructions to AOs to reduce/delete tax demand as per rectification with documents of tax/ demand already paid [Press Note 402/92/2006-MC of 17-04-2014].  
• ITR-7, Political Parties to e-file with digital signature. Trusts etc can file manually or electronically with or without digital signature [Revised IT Rule 12].
• Approval of existing Related Party contracts in Listed Companies which continue beyond 31-03-2015 in first General Meeting after 01-10-2014 [SEBI Circular of 17-04-2014]. 
• Loss on writing-off of irrecoverable advances under scheme of amalgamation cannot be carried forward for set off in subsequent years.
• Notice to AO u/s 11(2) by Charitable & Religious Trusts etc. for accumulation of income upto 5 years to be given electronically in Form 10 [Revised IT Rule 12].  
• Clarified that partners share in profits of firm (including income on which tax not paid due to exemption or deduction) exempt from tax. [Income Tax Circular 8 of 30-03-2014].  
• Applicability of the Companies Act 2013 to Auditor’s Report to FY 2014-15 and onwards. MCA on 04th April 2014, vide its General Circular No. 08/2014, clarified that the Financial Statements, Auditor's Report and Board's Report in respect of financial years that commenced earlier than 01st April, 2014 shall be governed by the relevant provisions/Schedules/rules of the Companies Act 1956.  
• Seven punishments in Section 447 to 453 of Companies Act 2013 which replaces the 1956 Act. It is very essential to understand these seven sections. . 
• Hasty recovery action may be treated as contempt of court. [Bombay High Court in A. T. KEARNEY INDIA PVT. LTD. versus INCOME TAX OFFICER].  
• Table of fees payable under Companies Act, 2013 by one person Company, small Companies and other Companies. [Rule 12 of Companies (Registration of Offices &Fees) Rules, 2014].  
• Reserve Bank of India circular dated 16-April-2014 regarding LLP permitted to receive Foreign Direct Investment (FDI).  
• Every Listed Company and Public Company having paid-up share capital of Rs 10 cr or more to have (a) MD, CEO, Manager or Whole-time Director  (b) CFO (c) CS.  
• Loss on writing-off the irrecoverable advances in accordance of scheme of amalgamation is not a capital loss and eligible to be carried forward for set off in subsequent years [M/s Crompton Greaves Limited Vs. DCIT, ITA No. 1110 of 2012, Date of Pronouncement: 25.03.2014, High Court of Bombay].  
• Where assessee held shares from seven to eleven months, earned dividend and entered into a few transactions of sale of such shares during relevant year even though he held a huge number of shares, income arising from sale of shares would be taxable as short-term capital gain [CIT vs Vinay Mittal].  
• The Gujarat High Court in CIT v Siddhartha J. Desai 139 ITR 628 (Guj) (1983) has laid down the tests for determining whether the land is agricultural or not.  
• To ensure tax compliance, MCA to obtain and incorporate comments of IT Department in its response to court in Merger/Amalgamation deals [IT Directive of 11-04-2014].  
• R-10 column mandatorily to be filled with central statutory form details for the year 2011-12 in the March-2014 Return. May be for assessment purpose. [Circular 1].  
• Fill Block R10 and R11 in CST Form 1 for Q4 of 2013-14. No data for 09-10 and 10-11 to be given as default assessment already over [DVAT Circular 1 of 09-04-2014].  
• Initial subscription Rs 100. Can E-pay PPF in CBS branch and depositor can opt for statement instead of pass book [Revised Rule 4 of PPF Scheme w.e.f 13-03-2014].