Income Tax Dept warns public against cash dealings of Rs 2 lakh or more saying that the receiver of the amount will have to cough up an equal amount as penalty.

Your income tax return will soon be processed in one day; Infosys to develop integrated e-filing system

The government on Wednesday said IT major Infosys will develop the next-generation income tax filing system for Rs 4,241.97 crore which will cut down the processing time for returns to one day from 63 days and expedite refunds.

The Cabinet, chaired by Prime Minister Narendra Modi, gave its "approval to expenditure sanction of Rs 4,241.97 crore for Integrated E-filing and Centralised Processing Centre 2.0 Project of the Income Tax Department", Union minister Piyush Goyal said.

Briefing media about the decision, he said the processing time at present for Income Tax Reurn (ITR) is 63 days and it will come down to one day after implementation of the project.

Goyal said the project is expected to be completed in 18 months and will be launched after three months of testing.

Infosys, he said, has been selected to implement the project after the bidding process.

The current system, he said, has been a success and new project will be more tax friendly.

The e-filing and Centralised Processing Centre (CPC) projects have enabled end-to-end automation of all processes within the Income Tax Department using various innovative methods to provide taxpayer services and to promote voluntary compliance.

The Cabinet also sanctioned a consolidated cost of Rs 1,482.44 crore for the existing CPC-ITR 1.0 project up to 2018-19.

Goyal also informed that tax refunds worth Rs 1.83 lakh crore have been issued so far in the current fiscal.

The decision will ensure transparency and accountability besides faster processing of returns and issue of refunds to the taxpayers' bank account directly without any interface with the Income Tax Department.

The broad's objective of the integration project includes faster and accurate outcomes for taxpayer, enhancing user experience at all stages, improving awareness and education via continuous engagement, according to an official release.

Besides, it will also be promoting voluntary tax compliance and managing outstanding demand.

Read more at: economictimes.indiatimes.com
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No denial of sec. 54 relief if builder failed to complete construction within 3 years: HC

Where AO rejected assessee's claim for deduction under sec. 54 on ground that construction of new property was not completed within a period of three years as prescribed in section 54, in view of fact that delay was beyond control of assessee because construction was put up by builder, impugned order passed by Tribunal allowing assessee's claim was to be upheld

IT: Accumulated balance lying in provident fund of assessee upto retirement is eligible for exemption under section 10(12)

Refer:[2019] 101 taxmann.com 114 (Karnataka)
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Budget 2019 Expectations: Govt may Double Income Tax Threshold Limit

In a major relief to taxpayers, the Central Government may take a major decision in the upcoming interim budget to increase the exemption limit for income tax to five lakhs from the current 2.5 lakhs. 

The 2019 Budget will be tabled by Finance Minister Arun Jaitley on February 1. Inputs were sought from various central ministries as early as in October. 

It was said that “The impact of Demonetisation has been felt on the collection of personal income tax. Its collections were higher in Financial Year 2018-19 (till 31-10-2018) compared to the previous year by 20.2%. Even in the corporate tax, the collections are 19.5% higher. From two years prior to Demonetisation, direct tax collections have increased by 6.6% and 9% respectively. In the next two years, post Demonetisation the increase by 14.6% (part of the year before the impact of Demonetisation in 2016-17) and an increase of 18% in the year 2017-18.”

“Similarly, in the year 2017-18, the tax returns filed reached 6.86 crores, an increase of 25% over the previous year. This year, as on 31-10-2018, already 5.99 crore returns have been filed which is an increase of 54.33% compared to the previous year till this date. The new filers added this year are 86.35 lakh.” 

“In May 2014, when the present Government was elected the total number of the filers of income tax returns was 3.8 crore. In the first four years of this Government, it has increased to 6.86 crores. By the time the first five years of this Government are over, we will be close to doubling the assessee base.”

Read more at: http://www.taxscan.in
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CA Exams May be postponed to June

There are speculations that the Institute of Chartered Accountants of India (ICAI) is likely to postpone the CA exams to be held in May to June due to the general elections 2019. 

Reportedly, during the national student convention held in Mumbai on 12.01.2019, it was announced by CA Dheeraj Khandelwal & Vandana D. Nagpal (Director of Board of studies, ICAI), Now CA Final & CA Inter (IPCC) exams will be held in Jun’19 instead of May’2019 due to Lok Sabha elections. 

The Lok Sabha (General) Elections 2019 are due to be held in India sometime around in April and May 2019 to constitute the 17th Lok Sabha. The tenure of the present Narendra Modi led NDA government is to be expired in May. 

Further Mr. Rajanath Singh said in an interview to the Hindu, that general Lok Sabha elections to be held as per schedule itself.

Read more at: http://www.taxscan.in
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FinMin wants PSU banks to bring down govt equity to 52%

In a bid to align with the best corporate practices, the Finance Ministry has asked the public sector banks to gradually bring down the government’s equity to 52 %, a top official said.

“The government is essentially a major shareholder. So, this need to be aligned to the best corporate practices. The shareholding needs to come down to at least 52 % in the first phase. As and when market condition allows, banks will take step in that direction. They have all the permission in hand,” Financial Services Secretary Rajiv Kumar told PTI.

Dilution of government stake will help banks to meet 25 % public float norms of market regulator Sebi. Some of the public sector banks have government’s holding beyond 75 %.

Besides, it will encourage the banks to follow the prudential lending norms. The country’s largest lender State Bank of India (SBI) has already initiated step for Rs 20,000 crore share sale through qualified institutional placement (QIP). Post QIP, the government stake will be diluted from the existing 58.53 %.

Last month, shareholders of the bank approved sale of shares to fund the business growth.

Many other banks are planning to raise capital through some means or other, depending on the market condition.

Some of the lenders like Syndicate Bank, Union Bank of India, Punjab National Bank, and Oriental Bank of Commerce among others have already issued or in process of issuing Employee Share Purchase Scheme (ESPS).

He further said the government has also initiated the process for consolidation of Regional Rural Banks (RRBs) to better serve the needs of the rural India.

Recently, the Centre has amalgamated three RRBs -- Punjab Gramin Bank, Malwa Gramin Bank and Sutlej Gramin Bank -- into a single RRB with effect from January 1.

The central government, after consulting the sponsor banks of the three RRBs, felt that in the interest of the banks and the areas served by them, they should be amalgamated into a single RRB.

Besides, Punjab Gramin Bank (PNB), and Uttar Bihar Gramin Bank (UCO Bank) has been amalgamated with Madhya Bihar Gramin Bank (PNB).

While the consolidated RRB in Punjab is called Punjab Gramin Bank, with headquarters at Kapurthala, the one in Bihar has been rechristened as Dakshin Bihar Gramin (based in Patna).

These banks were formed under the RRB Act, 1976 with an objective to provide credit and other facilities to small farmers, agricultural labourers and artisans in rural areas.

Currently, the Centre holds 50 % in RRBs, while 35 % and 15 % are with the concerned sponsor banks and state governments, respectively.

Refer:https://www.livemint.com
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Appeal to be admitted if defect of non-payment of tax is removed by assessee later on

In terms of sub-section (4) of section 249, payment of tax is mandatory but requirement of paying such tax before filing appeal is only directory and, therefore, when defect in appeal, being non-payment of such tax, is removed, earlier defective appeal becomes valid

Refer:[2019] 101 taxmann.com 85 (Bangalore - Trib.)
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Sec. 80G approval couldn't be denied just because trust had spent insignificant amount during the year

Where assessee-trust had claimed approval under section 80G(5)(vi), since neither Commissioner (Exemption) had recorded any finding nor revenue had brought to fore, any breach of conditions enumerated in clauses (i) to (v) of section 80G(5) by assessee, approval under section 80G(5)(vi) could not be denied merely because donations made by assessee-trust were of insignificant amount

Refer:[2019] 101 taxmann.com 82 (Rajasthan)
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Relief for MSMEs, GST council hikes composition limit to Rs 1.5 crore from April 1

The 32nd GST council meet is over and brought some much-needed relief to the MSMEs. Addressing the press after the meet, Finance Minister Arun Jaitley informed that Composition scheme limit hiked to Rs 1.5 crore from April 1. People who opt for composition scheme will have to pay their tax quarterly but will now have to file their returns annually.

It may be noted that the council did not discuss the rates of individual items in today's meet. The Council approved composition scheme for Services. GST composition limit for services has been set at Rs 50 lakh and composition rate for services is set at 6 per cent. The exemption limit for GST for those with a turnover of up to 20 lakh has been increased to 40 lakhs.

Refer:https://www.timesnownews.com
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Revenue Loss: CBDT Chief asks Officials to ‘Maximize’ Efforts to curb Tax Evasion

Unhappy with the present revenue collections, Shri Sushil Chandra, the Chairman of the apex direct tax body, the Central Board of Direct Taxes ( CBDT ) has asked the income tax officers to “maximize” their efforts and conduct targeted surveys and file court cases against the tax evaders. 

The CBDT Chief has written a letter to the higher officials of the department asking them to pull up their socks as only three months are left for the current financial year to close on March 31. 

“On review of the trends of growth under different minor heads, it is noted that the growth in the collection under regular assessment tax (recovery from arrear and current demand) is extremely low at 1.1 percent as compared to 15.6 percent growth during the corresponding period last year.

“Most of the regions are, in fact, showing negative growth under regular assessment tax. This is a matter of serious concern and concerted efforts are now required to be made to drive up recovery from arrear and current demand,” the CBDT Chief said. 

Talking about direct tax collections, Chandra said that by the end of December 2018 the growth rate has been 13.6 percent as against the target of 14.7 percent.
“The position of growth in gross collections is marginally better at 14.1 percent but still below achieving the budget estimates of Rs 11,50,000 crore,” he said. 

The CBDT chief also suggested some “strategies” to be adopted and implemented to achieve the targets. 

He asked the officers to conduct “targeted recovery surveys in potential cases where a high amount of recovery is likely”. 

“Sale of attached properties in appropriate cases by tax recovery officers to recover confirmed demand where normal measures of recovery have not yielded results” to be deployed, undertaking action to recover outstanding dues from companies and filing prosecution complaints in courts against those people who are willfully evading payment of outstanding taxes. 

In the letter, the CBDT chief further directed the officers to train their scanner on tax deducted at source (TDS) collections and launch prosecution against those who are at “substantial default”. They were also directed to “verify advance tax payment” by those who sell properties and monitoring of dividend distribution tax. 

The taxman has also been asked to timely complete regular assessments (non-time-barring) in cases where demand is likely to be raised and collected during the current fiscal.

“Other strategies depending upon the specific characteristics of the region should also be adopted so as to increase collections and ultimately achieve the budget target,” Chandra directed.

Read more at: http://www.taxscan.in
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Govt. likely to collect KYC details of Chartered Accountants

The Central Government is planning to collect the Know Your Customer ( KYC ) details of the companies, Chartered Accountants, Cost Accountants and Company Secretaries, reported Indian Express. 

Recently, Government has introduced an initiative for directors of companies last year. 

A senior Corporate Affairs Ministry official said that the exercise would help in having a “sanitised list” of companies and professionals. 

Last year, the government had initiated KYC against directors of companies. However, against 3.3 million individuals who had Director Identification Numbers (DINs), only little over 1.6 million have complied with the KYC requirement — almost half the number. DIN is a unique number allotted to individuals eligible to have directorship on the Boards of registered companies. The form should be filed by every Director using his own DSC and should be duly certified by a practising professional (CA/CS/CMA). Filing of DIR-3 KYC would be mandatory for Disqualified Directors also.

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