Latest Income Tax & GST Weekly Due Dates, Notifications / Press Info, Case Laws, etc

delighted to share our 64th E-Newsletter “Weekly Taxation Newsletter” dated 21st February, 2022 from 14th February, 2022 to 20th February, 2022 with you. This E – Newsletter is a weekly reference 

/ compilation of interesting and latest news related to tax including upcoming Timelines / Due Dates, Notifications / Press Information, Case Laws, International Taxation etc. 

Stay updated, Stay connected 

CBDT extends due dates for filing of Income Tax Returns and various reports of audit for Assessment Year 2021-22 

Type of Compliance Requirement (AY 2021-22) Original Due Date Extension vide Circular 9/2021 Extension vide Cir. 17/2021 Extension vide Circular 1/2022 
Income Tax Return (Assessees subject to Audit): u/s 139(1) of the Income Tax Act, 1961   31/10/2021   30/11/2021   15/02/2022   15/03/2022 
Income Tax Return (Assessees subject to Transfer Pricing Report): u/s 139(1) of the Income Tax Act, 1961    30/11/2021    31/12/2021    28/02/2022   15/03/2022 
Tax Audit Report: under any Provision/ Section of the Income Tax Act, 1961   30/09/2021   31/10/2021   15/01/2022   15/02/2022 
Transfer Pricing Report: u/s 92E of the Income Tax Act, 1961   31/10/2021   30/11/2021   31/01/2022   15/02/2022 
Belated/ Revised Income Tax Return: u/s 139(4)/ 139(5) of the Income Tax Act, 1961   31/12/2021   31/01/2022   31/03/2022  No Change 31/03/2022 
  1. Filing of GSTR –3B 

Taxpayers having aggregate turnover > Rs. 5 Cr. in preceding FY 

Tax period Due Date No interest payable till Particulars 
  January, 2022   20th February, 2022   – Due Date for filling GSTR – 3B return for the month of June, 2021 for the taxpayer with Aggregate turnover exceeding INR 5 crores during previous year 

b). Taxpayers having aggregate turnover upto Rs. 5 crores in preceding FY (Group A)

Tax period Due Date No interest payable till Particulars 
  January, 2022   22nd February, 2022  Due Date for filling GSTR – 3B return for the month of June, 2021 for the taxpayer with Aggregate turnover upto INR 5 crores during previous year and who has opted for Quarterly filing of GSTR-3B 
Group A States: Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana, Andhra Pradesh, Daman & Diu and Dadra & Nagar Haveli, Puducherry, Andaman and Nicobar Islands, Lakshadweep 

c). Taxpayers having aggregate turnover upto Rs. 5 crores in preceding FY (Group B)

 

Tax period Due Date No interest payable till Particulars 
January, 2022 24th February, 2022   
Group B States: Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand, Odisha, Jammu and Kashmir, Ladakh, Chandigarh, Delhi 

B. GST Refund:

Form No. Compliance Particulars Due Date 
RFD -10 Refund of Tax to Certain Persons 18 Months after the end of quarter for which refund is to be claimed 

C. Annual Returns: 

Form No. Compliance Particulars Due Date 
 GSTR – 9 GSTR-9 is Annual Return applicable for registered person with aggregate turnover exceeding INR 2 Crores during the F.Y. 2020-21. However, registered  28.02.2021 

Major Update:Aadhaar authentication of registered person is mandatory for filing of Refund/Revocation of cancelled registration applications w. e. from 1.1.2022.

Weekly Departmental updates: Income Tax

CBDT issues refunds worth Rs 1.71 lakh crore to taxpayers in FY22

The income tax department on Wednesday said it has issued refunds of over Rs 1.71 lakh crore to more than 1.97 crore taxpayers so far in the current fiscal year. In a tweet, the Central Board of Direct Taxes (CBDT) said, “Refunds of over Rs. 1,71,555 crore to more than 1.97 crore taxpayers from 1 April 2021 to 14 February 2022 have been issued”.

This includes income tax refunds worth Rs 63,234 crore being issued to 1.95 crore individual cases of direct income tax filed by individuals. Also, corporate tax refunds worth Rs 1.08 lakh crore have been issued in 2.28 lakh cases of corporate tax filed by companies.

Majority of the refunds (worth Rs 1.39 lakh crore) are being issued for income tax paid for the FY21 (2020-21) assessment year which ended on March 31. For individual taxpayers, the deadline for filing tax returns for that fiscal was December 31, 2021. For corporate taxpayers, the last date is March 15, 2022. (Read more at: Click Here)

2. Most glitches in income tax portal fixed, no interest relief to late filers: CBDT

The Central Board of Direct Taxes has informed the Gujarat High Court that most glitches in the e-filing portal had been fixed, Bloomberg Quint reported on Monday. The CBDT added no interest relief would be given to late filers. The Gujarat High Court had been hearing a plea seeking extension of deadline for filing of returns. 

Due dates for filing of income tax returns had been extended thrice this assessment year. Taxpayers were not required to pay interest on unpaid dues if they filed returns within the deadline periods. “Tax consultants argued that since a lot of delay was caused by the e-portal glitches, even large taxpayers must get the relief on interest liability. The CBDT’s latest affidavit denies the relief, saying this was a conscious decision. Taxpayers with a liability over

Rs 1 lakh would not be small or medium taxpayers, it said. They would mostly be large taxpayers having a large turnover,” Bloomberg quint reported the CBDT affidavit as saying.

To read more Click Here 

3.Income Tax alert: Tax department asks taxpayers to complete this pending work 

The Income Tax Department has urged taxpayers to complete an important task. Taxpayers who are yet to accept the Tax Audit Reports (TARs) submitted by their Chartered Accountants (CA) must complete the process of submission, the Central Board of Direct Taxes (CBDT) said in a statement. 

“The Department expresses gratitude to all tax professionals and taxpayers for their support in compliance and requests the attention of taxpayers who are yet to accept the Tax Audit Report submitted by their CA to complete the process of submission,” CBDT stated. More than 29.8 lakh major TARs have been filed on the e-filing portal of the Income Tax Department by February 15, 2022, the CBDT stated. To read more Click Here

4. Budget 2022 has removed this tax deduction for current financial year also 

Section 14A of the Income-tax Act, 1961 which provides for disallowance of expenses incurred for earning exempt income, has been a matter of widespread litigation. The most common issue is in case of investment in shares of Indian companies since dividends distributed by Indian companies were exempt from tax for the shareholders (for both individuals and non- individuals) uptil March 31, 2020 (subject to a limit of Rs.10 lakh in case of non-corporate shareholders). 

According to Rule 8D(2), the expenditure in relation to exempt income shall be the aggregate of following amounts, namely:

(i) the amount of expenditure directly relating to tax-exempt income which does not form part of total income; and 

(ii)an amount equal to 1% of the annual average of the monthly average of the opening and closing balances of the value of investment , income from which does not or shall not form part of total income. This means for each month an assessee takes average of all the months. 

     The controversy is whether such disallowance will be made even if the assessee does not earn any exempt income. 

The Central Board of Direct Taxes (CBDT) vide Circular No. 5 of 2014 dated February 11, 2014 clarified that, the legislative intent is to allow only that expenditure which is relatable to earning of income which is taxable and it therefore follows that the expenses which are relatable to earning of tax-exempt income have to be considered for disallowance, irrespective of the fact whether such income has been earned during the financial year or not. However, various courts gave verdict in favor of the taxpayers that in case no tax-exempt income is earned, no disallowance should be made under section 14A. 

  • (Read more at Click Here) 
  • Quick Steps to filing your income-tax returns smooth
  • 1 Visit Click Here for e-filing the return of income.
  • 2 Create you login Id and Password on Income tax portal. (Register Yourself).
  • 3 Login to e-Filing portal by entering user ID (PAN), Password, Captcha code and click ‘Login’.
  • 4 Click on the ‘e-File’ menu and then click ‘Income Tax Return’ link.
  • 5 Select ‘Assessment Year’, Select ‘ITR Form Number’, Select ‘Filing Type’ as ‘Original/Revised Return, ‘Select ‘Submission Mode’ as ‘Prepare and Submit Online’ and then Continue.
  • 6 Fill all the applicable and mandatory fields of the online ITR form.
  • 7 Choose the appropriate Verification option in the ‘Taxes Paid and Verification’ tab. 
  • 8 Click on ‘Preview and Submit’ button, Verify all the data entered in the ITR.
  • 9 Individuals should ensure that correct PAN, Aadhaar and TAN numbers are filed, and that the residential status is correctly determined and mentioned. They should also verify all the details filed in the ITR Form before final submission of the tax return.
  • 10 ‘Submit’ the ITR after complete check.
  • 11 The ITR filing process gets completed only on e-verification of ITR filed. There are various options available to e-verify tax return i.e. using Aadhaar OTP, using Net banking, using Demat account, using bank ATM, or by simply sending the signed physical copy of Form ITR-V to CPC Bangalore. 
  • The taxpayer must ensure that PAN and Aadhaar are linked (date for linking is currently extended to March 31, 2022) and the Indian mobile number is active to ensure smooth e-verification of returns filed. Once the e-verification is complete, tax authorities consider the return to have been filed.se one discovers any error after filing tax return, then there is the option to file a revised India tax return within a prescribed timeline. 
  • Key Point – Must remember:
  • Provide your valid Email ID and mobile number while Registration.
  • On Income Tax Return Page: PAN will be auto-populated. 
  • Use your Form 26AS to summarise your TDS payment for all the 4 quarters of the assessment year
  • Read the instructions carefully
  • Income tax Return: Documents needed to file ITR 
  • You need to select appropriate ITR form.
  • Primarily you need PAN, Aadhaar card and bank statements for the financial year. 
  • You also need the Form 16 issued by the employer and Form 16 issued by any other entity. 
  • You need Form 26AS (downloadable from the income tax portal) to check how much TDS was deducted and by who. 
  • Details of income from other sources. 
  • You also need capital gains and share trading statement. 
  • You may also need investment documents such as PPF (Public Provident Fund), NSC (National Savings Certificate), life insurance, medical insurance, NPS (National Pension System), investment in other tax-saving instruments. 
  • Interest and principal repayment certificates of housing loan and donation receipt is also needed while filing ITR. 

There is no need to worry if you are among taxpayers who have not filed ITR by the due date i.e. on or before 31.12.2021, as the process can be completed by March 31, 2022 by filing Belated ITR and the last date to submit Belated ITR for AY 2021-22.

Those who were not able to file their returns by the due date, i.e. by 31.12.2021 (extended due date) can still do so but they have to pay penalty fee for late ITR filing. From FY 21 or Assessment Year 2021-22 (AY22), the penalty amount for late filing beyond ITR filing deadline was reduced to Rs 5,000 from Rs 10,000 earlier. Due Date filing of belated ITR for AY 2021-22 is 31st March 2022.

Sl. Particulars of the Notification(s) File No. / Circular No. Notification Link(s) 
1. NIL NIL NIL 

  Window to opt in for composition for the FY 2022-23 is made available at GST Portal. The eligible taxpayers, who wish to avail the composition scheme may opt in for composition before 31st March 2022.

3. Series of lectures on GST gets Presidential award to Mohana Rao 

KV Mohana Rao set a new example when he received the Presidential Award for Specially Distinguished Record of Service. The criteria for the award selection, when it comes to tax and customs sleuths, is usually made on the basis of tax revenue achieved or the number of cases dealt. However, Mohan Rao, additional assistant director at the National Academy of Customs, Indirect Taxes & Narcotics (NACIN), Visakhapatnam, was given the award for training several government officials on the Goods and Services Tax Act and amendments made to it. 

The officer took more than 1,000 sessions on the subject and taught officers from the Central and State GST departments, as well as the members of trade associations. Nevertheless, his road to success was not smooth. Born in Tekkali of Srikakulam district, a backward region in Andhra Pradesh, Mohan Rao struggled to pursue his education, given the region had only a few educational facilities back when he was growing up. Rao’s lecturers on GST at National e-Governance Division (NeGD), Delhi were recorded. He was also an active member of the Union government’s prestigious ‘Integrated Government Online Training (IGOT)-Mission Karma Yogi’ project. To read more Click Here 

4. Coming soon, a structural revamp of GST  

The Union government and states will implement a proposed structural revamp of the goods and services tax (GST) in phases, keeping in mind the impact tax rate changes can have on consumption, according to two officials.

The proposed revisions will include pruning tax exemptions, removing anomalies from taxing raw materials and intermediates higher than finished products, and reducing the number of GST slabs, said one of the officials, who spoke on condition of anonymity. 

The revisions are currently being studied by two ministerial panels and will entail implementing the tax rate changes needed in the textile industry to correct the inverted duty structure, which have been kept on hold. On 31 December, the council deferred a rate hike from 5% to 12% on several items in the textile and apparel sector, including woven fabrics of cotton, silk and wool, coir mats, apparel and clothing accessories of sale value up to ₹1,000, which was to take effect from 1 January. An email sent to the finance ministry seeking comments for the story remained unanswered at the time of publishing. 

To read more Click Here

5. Govt. likely to propose 18% GST on crypto mining, trading entities  

The Center will submit a proposal to the Goods and Services Tax Council (GST Council) to impose GST on entities that provide a mining platform for cryptocurrency assets and those that use virtual digital assets as a means of exchange in purchases. While the Central Board of Indirect Taxes and Customs (CBIC) is examining the matter, its chairman Vivek Johri told Business Standard that the proposal could be to tax these at 18 percent.

While the Central Board of Indirect Taxes and Customs (CBIC) is examining the matter, its Chairman Vivek Johri told Business Standard the proposal could be to tax these at the top bracket of 18%. To read more Click Here 

Sl. No.  Particulars of the Notification(s) File No. / Circular No. Notification Link(s) 
1 Setup of ‘GST Refund Help Desk’ in the office of Pr. CCA, CBIC GSTN Circular : 523 Click Here
 

Income Tax

  1. ITAT defines the meaning of ‘set aside’ and directs that AO can’t do fresh 
  1. 1. assessment if assessment order was set aside by ITAT
  2.  

Case Details: Jaya Prakash v. ITO

Citation: [2021] 133 taxmann.com 189 (Bangalore – Trib.) 

The Tribunal had set aside the assessment framed by AO on the basis of Form 26AS. After that, Assessing Officer (AO) initiated a fresh assessment considering the remarks made by Tribunal in its order. The assessee filed appeal contended that the AO misunderstood the order 

of the Tribunal. The AO believed that the disputed issue was remitted to him to do a fresh assessment. However, there was no such direction issued by the Tribunal. 

The Tribunal held that it is essential to clarify the meaning of the word ‘set aside’. As per Black’s Law Dictionary, Sixth Edition at page 1372, the words “set aside” means: 

‘To reverse, vacate, cancel, annul or revoke a judgment, order, etc.’ 

Further, the meaning of the word ‘annul’ on page 90 of the Black’s Law Dictionary has given as under: 

“To reduce to nothing; annihilate; obliterate; to make void or of no effect; to nullify; to abolish; to do away with. To cancel; destroy; abrogate. To annul a judgment or judicial proceeding is to deprive it of all force and operation, either ab initio or prospectively as to future transaction.” 

Furthermore, the meaning of the word ‘annulment’ is given on page 91 as under: 

“To nullify, to abolish, to make void by the competent authority. An “annulment” defers from a divorce in that a divorce terminates a legal status, whereas an annulment establishes that a marital status never existed. Whealton v. Whealton, 67 Cal. 2 d 656, 63 Cal Rptr. 291, 294, 432 P. 2 d 979. Grounds and procedures for annulment of marriage are governed by State Statutes.” 

Thus, the word ‘set aside’ means that the earlier assessment order has been quashed, and there was no direction by the Tribunal to do any fresh assessment on the same issue. When there is no direction to do the fresh assessment and the earlier assessment year has been set aside, the AO cannot take advantage of passing remark/observation on the Tribunal order to frame fresh asst. on the same issue. 

  • Source: Taxmann 
  1. ‘iPad’ may have some computing functions, but it isn’t a computer for higher 

depreciation: ITAT 

Case Details: Kohinoor Indian (P.) Ltd. v. ACIT 

Citation: [2021] 129 taxmann.com 396 (Amritsar – Trib.) 

The Amritsar Tribunal has ruled that the predominant purpose of the iPad is communication, and it is not a computing device. Its main features are email, WhatsApp, Facetime calls, music, films, etc. Though the iPad may discharge some of the functions of computers, it is not a substitution for computers or laptops. In common parlance, the iPad is considered as communicating device with some additional features of a computer. 

Further, apple stores do not sell the iPad as a computer device, but rather, it is selling it as communicating/entertainment device. Another reason the iPad can be held as a communication device is it has an IMEI number. Though the assessee had denied having an IMEI number, no concrete records have been produced on record in this regard. Accordingly, ITAT held that the iPad is not a computer. Hence, depreciation is applicable at a lower rate.

  • Source: Taxmann 
  •  courses to doctors even if mandated by Medical Council should be taxed under Online GST: AAR

Complicating the issue of taxation of education and medical facilities, the Karnataka Authority for Advance Ruling (AAR) has recently ruled that Goods and Services Tax (GST) should be applicable on paid online medical contents. Even though healthcare services and education are exempted from GST services, Karnataka AAR has clarified that online courses, which are specifically targeted at doctors and mandated by the medical council cannot be defined as medical facility even when the courses are mandatory for doctors 

“The paid education content, which is used by health care professionals or students to fulfill a mandatory demand by their professional body or institute is not exempt to tax under the provisions of the Central Goods and Services Tax Act or Karnataka Goods and Services Tax Act or Integrated Goods and Services Tax Act, 2017,” ruled AAR. 

Karnataka AAR had been approached by the applicant regarding the question of whether paid educational content, which is used by health care professionals or students for fulfilling a mandatory demand by their professional body or institute, should be exempted from tax. 

The applicant contended that as its content is recognized by a governmental body, it should be exempted from tax. Further, the applicant was of the opinion that Portfolio management is a service to healthcare professionals who have to fulfill a mandatory requirement and a service to a governing body such as KMC. Therefore, this service should also be exempted from tax. 

Reference: Click Here

Lease of residential premises as hostel is exempted from GST: HC

The Court pointed out that petitioner’s building used as hostel is classified under residential 

category in the Revised Master Plan 2015 of Bangalore City. 

The High Court of Karnataka has said that leasing of residential premises as hostel for students and working professionals is exempted from payment of Goods and Services Tax (GST). A Division Bench comprising Justice Alok Aradhe and Justice M.I. Arun passed the order while allowing a petition filed by Taghar Vasudev Ambarish, a resident of Jayanagar in Bengaluru. 

The petitioner, along with co-owners, had leased out a residential property, having 42 rooms, to lessee, M/s DTwelve Spaces Private Limited for using as a hostel for providing long-term accommodation to students and working professionals for their stay between three to 12 months period. 

The Appellate Authority on Advance Ruling, Karnataka had in August 2020 had said that the “property rented out by the petitioner is a hostel building, which is more akin to ‘sociable accommodation’ rather than that is commonly understood as residential accommodation.” 

‘Students hostel is residential accommodation’ 

However, the Court pointed out that the Central Board of Indirect Taxes and Customs in its Education Guide issued in 2012 had clarified that “in normal trade parlance residential dwelling means any residential accommodation and is different from hotel, motel, inn, guest house etc. which is meant for temporary stay.” 

As the word ‘residential dwelling’ is not defined in the GST Act, the Court, from the dictionary pointed out that the expression ‘residence’ and ‘dwelling’ have more or less the connotation in common parlance and therefore, no different meaning can be assigned to the expression ‘residential dwelling’ and it cannot be held that the same does not include hostel, which is used for residential purposes by students or working women. 

The petitioner is entitled for exemption from GST as firstly, the residential dwelling, rented for being used as hostel, fall within the purview of residential dwelling as the same is used by the students and the working women for the purposes of residence, and secondly, the residential dwelling is being used for the purposes of residence.

Singapore announces 2022 budget proposals 

PwC’s Singapore Budget 2022 proposals are pivoted on three key themes around creating an active economy, a beautiful society and a clean environment, with business competitiveness, social resilience and environment, social, and governance (ESG) identified as the main areas of focus. 

  • Singapore’s Finance Minister Lawrence Wong announced a $500 million Singapore dollars ($372 million) package to support jobs and businesses as part of his budget proposals on Friday, adding that the government will extend separate targeted help for the struggling aviation sector. 
  • Singapore’s government has committed close to SG$100 billion over the past two years to cushion its people, businesses and the economy from the impact of the Covid-19 pandemic. 
  • Wong also said the government would set aside SG$560 million package to help Singaporeans deal with the rising cost of living

He said the government was closely monitoring the risk of rising inflation and the cost of living, which has been driven by the recovery in global demand amid continuing supply chain disruptions and especially by the rise in energy prices. (Read more at: Click Here) 

2. UAE corporate tax: There is enough time for businesses to get processes right 

Between now and June ’23, there is much UAE businesses can learn and integrate on the tax. The corporate tax move should be seen as UAE’s push for a greater integration into the global economy and the wider reshaping of corporate tax regimes. But do not forget the 9% tax is one of the most competitive in the world. 

The UAE plans to introduce a 9 per cent tax on corporate profits from June 2023 as part of an ongoing plan to diversify the economy from oil and gas revenues and ease fiscal pressures. While the UAE’s tax-free status has long attracted global businesses, the levy-free regime has helped grow the economy of the Gulf nation as a global business hub. 

Most recently, reflecting a focus on its diversity, the UAE adopted law amendments that will allow granting Emirati citizenship to investors, specialized talent and professionals. This select group of foreign professionals will include doctors, scientists, engineers, artists, authors, and their families. 

A 0 per cent tax rate will be applicable on taxable profits up to Dh375,000 in an attempt to support small businesses and startups. This could well be the most competitive tax arrangement in the world, and as it seems Dubai, being home to the regional business hub, will probably be the greatest source of corporate tax revenue. 

As the next 18 months unfold, those of us in large corporations that contribute to the UAE’s GDP by providing goods, services, and jobs for UAE citizens and residents will continue to plan our implementation of the corporate tax. And look for ways to mitigate the impact on shareholders and stakeholders while honoring the principles and intent of the tax’s implementation. Read more at: Click Here) 

Knowledge Bucket for NRI’s

  1. Under India’s income tax laws, all foreign assets must be reported in the India ITR if the individual qualifies as “resident and ordinarily resident” of the country during the relevant financial year. 
  1. One has to be very careful in reporting foreign assets or income in India Income-tax Return. Any omission or inaccurate particulars may invite additional taxes, interest and penal consequences under Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015. 
  1. Income earned abroad is not taxable in India, but other income (salary or income received in India or from a business in India) may be taxable for NRIs. Apart from these, rental income from houses located in India, interest received in a savings account and fixed deposits held in Indian banks, capital gains income from capital assets such as house property, shares and securities, gold, etc. are taxable in India. 
  1. NRIs can get tax deductions on certain products, many of which come under Section 80C of the Income-tax Act, but there are others too. 
  1. NRIs are not eligible to invest Sukanya Samriddhi Yojana: Not available to NRIs. 

DO YOU KNOW ??

  1. Don’t miss out on the last chance to verify your ITR for AY 2020-21. ITR filing is incomplete if not verified. The last date for verification for AY 2020-21 is 28th February 2022. 
  1. The Finance Minister announced a new tax rule for taxpayers where a taxpayer can file an updated return on payment of taxes within two years from the end of the relevant assessment year. 
  1. The surcharge on the long-term capital gains (LTCG) has been capped at 15%. The rate of LTCG vary between 10% to 20% depending upon the type or class of assets. 
  1. An individual taxpayer will continue to be charged one the same tax rates as before, depending on the tax regime that he/she choses for FY 2022-23, which commences from from April 1, 2022. 
  1. Under both income tax regimes, tax rebate of up to Rs 12,500 is available to an individual taxpayer under section 87A of the Income-tax Act, 1961. This  would effectively mean that individuals having net taxable income of up to Rs 5 lakh would not pay any income tax irrespective of the tax regime chose by them. 
  2. Disclaimer:
  3. Every effort has been made to avoid errors or omissions in this material. In spite of this, errors may creep in. Any mistake, error or discrepancy noted may be brought to our notice which shall be taken care of in the next edition. In no event the author shall be liable for any direct, indirect, special or incidental damage resulting from or arising out of or in connection with the use of this information. *(We consider various sources including ET, BS, HT, Taxmann etc.)