CA in Jaipur | CA. Yogesh Jangid |ITR Filing 2023 | Company Registration | NGO Registration | Income Tax Raid Cases | Audit | Inc Incroporation | CPA in India | Subsidy | Project Funding | GST | GST Raid Cases | Income Tax Notice Faceless | DRI Cases | https://www.nyca.in ITR Filing 2023 | Company Registration | NGO Registration | Income Tax Raid Cases | Audit | Inc Incroporation | CPA in India | Subsidy | Project Funding | GST | GST Raid Cases | Income Tax Notice Faceless | DRI Cases Wed, 10 Apr 2024 08:11:09 +0000 en-US hourly 1 https://wordpress.org/?v=6.9.1 https://www.nyca.in/wp-content/uploads/2022/08/9060CA_logo_icai-1.jpg CA in Jaipur | CA. Yogesh Jangid |ITR Filing 2023 | Company Registration | NGO Registration | Income Tax Raid Cases | Audit | Inc Incroporation | CPA in India | Subsidy | Project Funding | GST | GST Raid Cases | Income Tax Notice Faceless | DRI Cases | https://www.nyca.in 32 32 Understanding the Tax Advantages of Section 115H for NRIs https://www.nyca.in/understanding-the-tax-advantages-of-section-115h-for-nris/ https://www.nyca.in/understanding-the-tax-advantages-of-section-115h-for-nris/#respond Wed, 10 Apr 2024 08:11:09 +0000 https://www.nyca.in/?p=8461 Section 115H of the Income Tax Act provides favorable tax rates for non-resident Indians (NRIs) on specific investments, encouraging them to invest in India and boosting the country's attractiveness as a financial destination.

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Overview of Section 115H:

Section 115H of the Income Tax Act provides favorable tax rates for non-resident Indians (NRIs) on specific investments, encouraging them to invest in India and boosting the country’s attractiveness as a financial destination.

Benefits Under Section 115H:

  • NRIs enjoy concessional tax rates even after becoming resident Indians in subsequent years.
  • The primary benefit is the reduced tax rate on income earned from specified assets, including long-term and short-term capital gains, as well as dividend income.

Claiming the Benefit Under Section 115H:

  • Entities such as corporate firms, LLPs, companies, or any other organizations cannot claim tax exemption under Section 54. The eligibility criteria for claiming benefits under this section are as follows:
  • Residency in a country with a Double Taxation Avoidance Agreement (DTAA) with India.
  • Furnishing a valid Tax Residency Certificate (TRC) issued by the tax authorities of their resident country.

Continuing Benefits After Becoming a Resident Indian:

  • NRIs turning into resident Indians in subsequent years can still enjoy concessional tax rates on income from specified foreign exchange assets by filing a declaration with their income tax return.

Key Considerations:

  • Tax benefits under Section 115H are applicable only to income earned from specific investments held by NRIs in India.
  • NRIs must file their income tax returns in India if their taxable income exceeds the basic exemption limit.
  • Seeking guidance from tax professionals is advisable to understand the nuances of Section 115H and maximize tax benefits.

Difference Between Section 115 and Section 115H:

  • Section 115 focuses on computing total income for residents and non-residents, while Section 115H specifically addresses concessional tax treatment for NRIs on income earned from specified foreign exchange assets.

Conclusion:

Understanding the eligibility criteria, benefits, and claiming process of Section 115H enables NRIs to make informed investment decisions and optimize their tax liabilities in India.

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]]> https://www.nyca.in/understanding-the-tax-advantages-of-section-115h-for-nris/feed/ 0 Tax Liability cannot be imposed merely because the financial statement did not provide State-wise turnover https://www.nyca.in/tax-liability-cannot-be-imposed-merely-because-the-financial-statement-did-not-provide-state-wise-turnover/ https://www.nyca.in/tax-liability-cannot-be-imposed-merely-because-the-financial-statement-did-not-provide-state-wise-turnover/#respond Thu, 04 Apr 2024 10:14:35 +0000 https://www.nyca.in/?p=8238 The imposition of tax liability solely based on the absence of state-wise turnover information in financial statements has been contested in the legal realm.

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The imposition of tax liability solely based on the absence of state-wise turnover information in financial statements has been contested in the legal realm. This matter was addressed by the Hon’ble Madras High Court in a recent case involving Tvl. Future General India Insurance Co. Ltd. versus Assistant Commissioner (State Tax) [WP No. 3534 OF 2024, dated February 16, 2024].

Facts:

Tvl. Future General India Insurance Co. Ltd. (“the Petitioner”) operated as a private general insurance firm, specializing in insurance services. On August 16, 2021, the Petitioner was served with an audit notice by the Assistant Commissioner (State Tax) (FAC) (“the Respondent”). In response, the Petitioner diligently furnished the necessary documents and addressed the discrepancies highlighted in the audit reports. Subsequently, after issuing both an intimation and a show cause notice (“the SCN”), the Competent Authority issued the assessment order on December 30, 2023 (“the Impugned Order”).

Within the Impugned Order, the issue of defect No. 10 arose, relating to variations in turnover between the Profit & Loss account and balance sheet, as opposed to the figures in GSTR-9. The Petitioner explained that these disparities stemmed from the inclusion of Pan-India operations in the financial statements, whereas GSTR-9 solely focused on turnover within Tamil Nadu. The Petitioner even provided a certificate from a Chartered Accountant, specifically outlining the turnover within Tamil Nadu, amounting to Rs. 80,89,05,068/-. However, despite this clarification and despite the Petitioner having already paid taxes on the stated turnover, the Respondent imposed State Goods and Services Tax (SGST) and Central Goods and Services Tax (CGST) at 18% each (36% combined) on the aforementioned turnover.

Dissatisfied with the assessment order, the Petitioner sought recourse by filing a writ petition before the Hon’ble High Court of Madras.

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Issue:

The central question revolves around whether tax liability can be established solely due to the absence of state-wise turnover information in financial statements.

Held:

In its ruling on Writ Petition No. 3534 OF 2024, the Hon’ble Madras High Court made the following determinations:

  • The Court acknowledged the variation in turnover for entities operating across multiple states, emphasizing the importance of distinguishing total turnover from state-wise turnover.
  • It criticized the Competent Authority's decision to impose GST at a higher rate of 36% instead of the appropriate 18%, despite the Petitioner having already paid tax on the turnover in question.
  • The Impugned Order was deemed invalid and the case was remanded to the Respondent for reconsideration.
  • Furthermore, the Court directed the Respondent to afford the Petitioner a fair opportunity, including a personal hearing, and instructed issuance of a fresh assessment order within a maximum period of two months, in compliance with legal provisions.

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]]> https://www.nyca.in/tax-liability-cannot-be-imposed-merely-because-the-financial-statement-did-not-provide-state-wise-turnover/feed/ 0 Validity of Assessment Orders in Light of Assessee’s Response https://www.nyca.in/validity-of-assessment-orders-in-light-of-assessees-response/ https://www.nyca.in/validity-of-assessment-orders-in-light-of-assessees-response/#respond Wed, 27 Mar 2024 07:01:20 +0000 https://www.nyca.in/?p=8004 The Delhi High Court, in the case of Emco Cables Pvt. Ltd. v. Union of India [W.P. 1622 of 2024, February 27, 2024], addressed the issue of the validity of an assessment order when the Assessee's response hadn't been duly considered.

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The Delhi High Court, in the case of Emco Cables Pvt. Ltd. v. Union of India [W.P. 1622 of 2024, February 27, 2024], addressed the issue of the validity of an assessment order when the Assessee’s response hadn’t been duly considered. The court emphasized the importance of taking into account the Assessee’s reply before issuing an assessment order. It was highlighted that if further details were needed, it was the responsibility of the Revenue Department to request them from the Assessee.

Facts of the case:

The case stemmed from a Show Cause Notice (SCN) dated September 24, 2023, issued by the Revenue Department against Emco Cables Pvt. Ltd. The notice accused the Assessee of under-declaring output tax, claiming excessive Input Tax Credit (ITC), and claiming ITC from canceled dealers and non-taxpayers. The Assessee responded to the notice with a detailed reply. However, the subsequent order dated December 29, 2023 (Impugned Order), found the Assessee’s reply unsatisfactory and directed further action without adequately considering the response.

Issue:

The central issue revolved around whether an assessment order lacking consideration of the Assessee’s response could be deemed valid.

Held:

The Delhi High Court’s ruling in W.P. 1622 of 2024 outlined the following key points:

  • Emphasized the obligation of the Proper Officer to thoroughly assess the Assessee's reply before forming an opinion on its sufficiency.
  • Noted the failure of the Proper Officer to seek additional details from the Assessee if deemed necessary, rather than dismissing the response outright.
  • Criticized the lack of evidence suggesting that the Proper Officer had indeed reviewed the Assessee's submission.
  • Set aside the Impugned Order and remanded the case back to the Proper Officer for reconsideration.

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