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GSTN Issues Advisory on Automatic HSN-wise Summary Population in GSTR-1 Table 12 from e-Invoices

editor — Wed, 10 Apr 2024 05:22:53 +0000

The GSTN has released an important Advisory No. 630 dated April 09, 2024, regarding the automatic population of HSN-wise summaries from e-Invoices into Table 12 of GSTR-1.

GSTN is pleased to announce the introduction of a new feature that enables the automatic population of HSN-wise summaries from e-Invoices into Table 12 of GSTR-1 on the GST portal. This feature facilitates the direct drafting of HSN data into Table 12 based on e-Invoice data.

It is important to note that the HSN-wise summary data automatically populated into Table 12 is provided for your convenience. However, it is advised to reconcile this data with your records before final submission.

Any discrepancies or errors identified should be manually corrected or added to Table 12 before the final submission.

For further details, please refer to the Advisory accessible at: Link to Advisory

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CBDT Urges Officers to Identify Top 30 Cases of TDS Shortfall by June 30, 2024

editor — Wed, 10 Apr 2024 05:13:23 +0000

The Central Board of Direct Taxes (CBDT) has instructed income tax officers to scrutinize the top 30 cases of insufficient tax deduction at source (TDS) and resolve at least 150 appeals by the Commissioner of Income Tax before June 30, 2024.

These directives are outlined in the interim action plan released by the CBDT for the fiscal year 2024-25, delineating the primary focus areas for field formations.

According to a recent communication from the CBDT to its officials, specific Key Result Areas have been identified for timely accomplishment, alongside attending to statutory limitation matters.

The CBDT routinely issues interim action plans to its officials at the onset of each financial year, refining them later in the year to form the final plan.

Additionally, the CBDT has called for seminars and awareness campaigns to be conducted on TDS. Over the years, TDS has emerged as a significant revenue source for the government, surging from Rs 2.13 lakh crore in FY13 to Rs 8.17 lakh crore in FY23.

As part of its interim plan for the current fiscal, the CBDT has also mandated the immediate approval of all pending refunds withheld under Section 241(A) once scrutiny assessments are completed and requisite orders are passed, either immediately or by April 30, 2024.

Furthermore, the CBDT has directed that all information requested by enforcement agencies such as the CBI, SEBI, and Enforcement Directorate before March 31, 2024, must be shared by the end of April. For requests received after April 1, information should be provided within 15 days.

Field officers are also tasked with identifying cases where seized assets are due for release as per Section 132B and facilitating their release by June 30, 2024.

Source: Business Today

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High Court Advocates Direct Communication, Urges Tax Department to Inform Taxpayers Prior to Action

editor — Wed, 10 Apr 2024 05:01:01 +0000

Introduction:

Certain demographics, including senior citizens, technologically hesitant individuals, Non-Resident Indians (NRIs), and those prone to forgetfulness, might be unaware of the Income Tax Department’s actions against them. The department initiates proceedings by uploading show-cause notices or summons to its online portal, without directly notifying these taxpayers via email or letter. Consequently, individuals who infrequently check the tax portal, as is common, may face unforeseen penalties and complications. This operational method by the tax authorities has raised concerns about its fairness.

High Court’s Critique:

Recently, the High Court criticized the tax authorities’ approach, highlighting the unreasonableness of expecting taxpayers to constantly monitor the e-portal for updates. In a case concerning the Munjal BCU Centre of Innovation and Entrepreneurship, the Punjab and Haryana High Court quashed a show-cause notice from November 2022. The court emphasized that legal provisions dictate the manner in which notices and orders must be served, rejecting the notion of notices being “presumed” received solely by placement on the e-portal.

Importance of Natural Justice:

An expert underscored the significance of natural justice in legal proceedings, emphasizing the principle of “audi alteram partem,” which requires both parties to be heard. Lack of communication regarding assessments, penalties, or other actions could result in hardships for taxpayers, missed deadlines, and ignorance of their right to respond, thereby increasing burdens for all parties involved.

Case Example: Munjal BCU:

Munjal BCU, dedicated to fostering innovation and startups in Ludhiana, received initial notices and reminders solely through the online tax portal. The court deemed this insufficient opportunity for the organization to present its case.

Historical Context:

Before 2009, the tax department primarily relied on physical mail for communication, transitioning to electronic means later. Placing communications solely on the income tax portal can pose tracking challenges, especially for certain demographics uncomfortable with technology. While portal accessibility is convenient, supplementary notifications via email and/or physical mail are necessary.

Expected Changes:

The court’s decision is expected to prompt the department to communicate through emails for various matters, including notices and summons.

Practitioners’ Concerns:

Tax practitioners have noted issues with recent proceedings, including notices not being visible on the portal and unreasonable response timeframes.

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Approval of outstanding refunds must be completed by April 30, Income Tax Department.

editor — Wed, 10 Apr 2024 04:45:35 +0000

The Income Tax Department has announced a positive development for individuals awaiting their income tax refunds. They have set a firm deadline of April 30 for the approval of all pending refunds.

Since the opening of the portal for the Assessment Year 2024-25 on April 1, there has been considerable activity, with over 46,000 income tax returns filed within the initial five days. Out of these, close to 3,000 returns have already undergone processing.

The Department has devised an interim action plan for the current fiscal year, outlining specific timelines for addressing various taxpayer-related matters. Immediate attention has been directed towards the approval of pending refunds, particularly those withheld under section 241A due to potential adverse effects on revenue, following the completion of scrutiny assessments and necessary orders. Despite the issuance of refunds exceeding ₹3.36 lakh crore in the fiscal year 2023-24, complaints persist regarding pending refunds from previous fiscal years.

Officials emphasize the importance of approving all pending refunds related to e-returns filed on the Income Tax Business Application (ITBA) for all assessment years by April 30. Additionally, a deadline of June 30 has been set for resolving penalties in at least half of the cases that will become time-barred by March 31, 2025.

Furthermore, attention has been drawn to cases involving Tax Deducted at Source (TDS), with a one-month timeframe provided for disposing of all pending applications as of April 1, 2024, for NIL or lower TDS/TCS. Additionally, orders are expected to be issued by June 30 for cases where TDS surveys were conducted up to March 31, 2024.

Source: https://www.thehindubusinessline.com/economy/it-department-sets-april-30-as-deadline-for-approval-of-pending-refunds/article68042765.ece

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Center Appears to Have Achieved Fiscal Year 2024 Gross Tax Objective

editor — Fri, 05 Apr 2024 05:07:07 +0000

The year 2023-24 not only witnessed multi-year high tax buoyancy levels – mainly on the direct taxes front – but also higher level of compliance from taxpayers, and strict enforcement measures against tax evaders. Total tax receipts (before devolution to states) of the Centre in FY24 “slightly exceeded” the revised estimate (RE) of Rs 34.37 trillion in the year, an official source told FE on condition of anonymity, even as the figures are being computed.

Tax Revenue Performance in FY24

Buoyant Tax Environment: FY24 witnessed multi-year high tax buoyancy levels, particularly in direct taxes, indicating robust revenue generation.
Increased Compliance: Taxpayers displayed higher levels of compliance, contributing to the overall revenue surge.
Stringent Enforcement: The government implemented strict enforcement measures against tax evaders, further bolstering revenue collection efforts.

Revenue Figures

Exceeding Revised Estimate (RE): Total tax receipts of the Centre for FY24 slightly exceeded the revised estimate of Rs 34.37 trillion, according to an official source.
Gross Tax Revenue: As of April-February FY24, the Centre's gross tax revenue reached Rs 28.9 trillion, accounting for 84% of the RE of Rs 34.4 trillion.
Net Tax Revenues: The attainment of the RE of Rs 23.24 trillion for net tax revenues (post-devolution) is yet to be confirmed, but deviations from the target are not expected.

Tax Buoyancy and Collection Trends

Buoyancy Surge: The Centre recorded a tax buoyancy of 1.5 in the first eleven months of FY24, significantly higher than the 0.9 recorded in FY23, indicating a strong revenue response to GDP growth and tax policy changes.
Personal Income Tax (PIT) Collections: PIT collections witnessed a record-high growth of 25.8% in April-February FY24, primarily due to increased compliance.
Corporate Tax Collections: Corporate tax collections surged by 17.3% in the first eleven months, surpassing the RE of FY24, driven by robust advance tax collections.
Advance Tax Collections: Advance tax collections for FY24 stood at Rs 9.11 trillion as of March 17, marking a 22.31% increase year-on-year.

Indirect Tax Performance

GST Collections: Gross GST collections in FY24 amounted to Rs 20.18 trillion, up 11.7% from FY23, indicating higher compliance and broadening of the tax base.
CBIC Initiatives: The CBIC initiated a focused drive in May 2023 to combat tax evasion, resulting in the detection of bogus firms and suspected Input Tax Credit (ITC) evasion, saving significant revenue for the Centre.
Customs and Excise Duties: Collections from customs duty and excise duty remained strong, reflecting vigilant efforts by tax departments to minimize tax evasion and maximize revenue collection.

Source: https://www.financialexpress.com/policy/economy-centre-seen-to-have-met-fy24-gross-tax-target-3444258/

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Decision by High Court Allows Refund of Reversed ITC When Supplier Pays Tax

editor — Tue, 02 Apr 2024 04:23:57 +0000

The Delhi High Court, in the matter of Pedersen Consultants India Pvt. Ltd. v. Union of India and Ors. [W.P. (C) 1039/2024 dated March 19, 2024], resolved the writ petition, permitting registered entities to submit refund applications for reversed Input Tax Credit (ITC) when the supplier has subsequently filed returns and paid taxes.

Facts of the case:

In the matter of Pedersen Consultants India Pvt. Ltd. v. Union of India and Ors. [W.P. (C) 1039/2024 dated March 19, 2024], the petitioner, Pedersen Consultants India Pvt. Ltd., filed a writ petition. The petition sought direction for granting Input Tax Credit (ITC) benefits on invoices where the recipient had filed subsequent returns and paid taxes.
The petitioner argued that they were compelled by the Revenue Department to pay taxes on invoices where the supplier hadn't filed returns on time. However, the supplier later filed returns and paid taxes, potentially leading to double taxation. Hence, the petitioner sought a refund for the taxes paid on such invoices.
Responding to objections, the petitioner proposed filing a refund application under Section 54 of the Central Goods and Services Tax Act, 2017 (CGST Act). Additionally, they cited Notification No. 13/2022 dated July 05, 2022, advocating the exclusion of the period between March 1, 2020, and February 28, 2023, from the limitation for filing refund applications. The petitioner also requested exclusion of the period between filing the writ petition and the court's order.

Held:

The Delhi High Court, in W.P. (C) 1039/2024, dismissed the writ petition, allowing the petitioner to file a refund application under Section 54 of the CGST Act. The court directed the respondent to adjudicate the petitioner's claim in accordance with the law. Notably, the court recognized the petitioner's eligibility under the Notification, excluding the period from March 1, 2020, to February 28, 2022, for computing the limitation period for filing refund applications.

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CBIC Declares March 29-31, 2024 as Working Days for All Customs Field Formations

editor — Fri, 29 Mar 2024 07:06:36 +0000

The Central Board of Indirect Taxes and Customs (CBIC) has announced that March 29th, 30th, and 31st, 2024 will be considered as working days for all Customs field formations. This decision is communicated through a letter dated March 28, 2024, with reference number F.No.401/118/2016-Cus.III (Pt.).

All Customs field offices are required to remain operational during these days, and officers and staff are expected to report for duty as usual. It is requested that this information be disseminated among all personnel for compliance.

The directive has been issued with the approval of the relevant authority.

The full letter can be accessed at: https://www.nyca.in/wp-content/uploads/2024/03/Letter_Customs_Working_Day_280324.pdf

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CBDT issues corrigendum to include sec. 43B(h) disallowance under clause 22 of Form 3CD

editor — Thu, 21 Mar 2024 07:32:17 +0000

The Central Board of Direct Taxes (CBDT) introduced amendments to Form 3CD through Notification No. 27/2024 /F. No. 370142/3/2024-TPL, dated 05-03-2024. These amendments primarily focused on enhancing disclosures related to certain provisions of the Income Tax Act.

Disclosure of Section 43B(h) Disallowance (Clause 26): The notification included a requirement for disclosure of disallowances under section 43B(h) within Clause 26 of Form 3CD. This amendment aimed to ensure transparency and comprehensive reporting of such disallowances in accordance with the Income Tax Act.
Amendment of Clause 22: Notably, Clause 22 of Form 3CD, which pertains to interest restrictions under the MSME (Micro, Small, and Medium Enterprises) Development Act, was not initially amended in the notification. However, subsequent revisions have now been made to Clause 22 to incorporate the disclosure of amounts disallowed under section 43B(h).

Source: https://www.nyca.in/wp-content/uploads/2024/03/notification-27-2024.pdf

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CBDT Orders Income Tax Offices to Operate on March 29-31, 2024

editor — Tue, 19 Mar 2024 04:39:58 +0000

The Central Board of Direct Taxes (CBDT) has issued an Order dated March 18, 2024, announcing the extension of working days for all Income Tax Offices in India. This extension applies to March 29, 30, and 31, 2024, with the aim of facilitating the completion of pending work.

Given that the Financial Year 2023-24 concludes on March 31, 2024, which falls on a Sunday, and March 30, 2024, is a Saturday, and March 29, 2024, is a closed holiday, this decision has been made to ensure that pending departmental tasks can be effectively addressed.

This directive, issued under section 119 of the Income-tax Act, 1961, by the Central Board of Direct Taxes, is aimed at providing administrative convenience and ensuring that necessary tasks are completed within the stipulated time frame.

For further details, the complete Order can be accessed at: https://www.nyca.in/wp-content/uploads/2024/03/CBDT-Order-18.3.2024.pdf

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Income Tax Exemption Announced for Specific Trusts and Institutions Under Conditions

editor — Tue, 12 Mar 2024 04:49:14 +0000

The Income Tax Department recently released guidelines on March 8, 2024, specifying conditions under which certain trusts, institutions, universities, educational entities, hospitals, or medical institutions can be exempted from income tax. These exemptions apply to entities falling under sections 10 and those registered under sections 12AA or 12AB of the Income-tax Act, 1961.

To be eligible for exemption under the mentioned sections, trusts or institutions must fulfill certain conditions outlined in various sections of the Act. For example, they must ensure that their accounts are audited and furnish the audit report in the prescribed form before the specified date.

The prescribed forms for audit reports, Form No. 10B and Form No. 10BB, were notified vide Notification No. 7 of 2023 dated February 21, 2023, effective for the assessment year 2023-24 and subsequent years. However, it has been observed that some trusts/institutions have furnished the wrong form, which could result in the denial of exemption.

In light of this, the Central Board of Direct Taxes has allowed trusts/institutions to rectify their audit reports by March 31, 2024, to claim exemption for the assessment year 2023-24. This flexibility is provided under Circular 2/2024 dated March 05, 2024, issued by the CBDT.

Source: Income Tax Portal

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