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A K G V G &Associates

CharteredAccountants
Delivering Excellence

AKGVG Weekly Insight-Vol II


09th January, 2017

Coverage:
 Income Tax Updates
 Customs Updates
 RBI Updates
 Accounting Updates
 MCA news

Regulatory Updates
Assembled & Edited by:
Team - AKGVG

AKGVG & Associates


Chartered Accountants
(Delhi | Gurgaon | Mumbai | Ahmedabad | Bangalore | Chennai)

Head Office: 307, Pearls Corporate, Mangalam Palace, Sector -3, Rohini,
New Delhi - 110085
Visit us on www.akgvg.com

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Ph: +91 9811118031, +91 9818330516, +91 9818314719
Third Protocol also enables application of domestic law and
measures concerning prevention of tax avoidance or tax evasion.

(Click here to read more)

CBDT amended Black Money (Undisclosed Foreign Income and


Assets) and Imposition of Tax Rules 2015

CBDT via Notification No. 123/2016, dtd 28.12.2016. has


amended Black Money (Undisclosed Foreign Income and Assets)
CBDT signs three more advance pricing agreement and Imposition of Tax Rules 2015 with Black Money (Undisclosed
Foreign Income and Assets) and Imposition of Tax (Amendment)
The Central Board of Direct Taxes (CBDT) has started the year Rules, 2016 which shall come into force on the date of its
2017 by entering into three unilateral Advance Pricing publication in the Official Gazette. The amended rules include
Agreements (APAs). The three APAs signed pertain to the
manner of payment of sum under sub-sections (2) or (5) of
Engineering Goods and Shipping sectors of the economy. The section 32, service of notice, summons, requisition, order or any
international transactions covered in these agreements include other communication, provisions relating to the approved valuer.
Intragroup Services and Support Services. Also Form no 8 for application for registration as an approved
With this, the total number of APAs entered into by the CBDT has valuer has been inserted.
reached 120 which includes 7 bilateral APAs and 113 Unilateral
APAs. A total of 56 APAs (4 bilateral APAs and 52 unilateral APAs)
have been entered into in the current financial year till date. Income tax officials raid premises of Buhari, ETA groups

(Click here to read more) Income tax investigation wing officials had launched searches on
the premises of Buhari Group and Gulf-based ETA Group of
India and Singapore Sign a Third Protocol for amending the
Companies in Chennai and other places following information on
DTAA concealment of income by them. In Tamil Nadu, the searches
The India-Singapore DTAA at present provides for residence were being carried out in Chennai, Tuticorin, Keelakarai
based taxation of capital gains of shares in a company. The Third (Ramanathapuram district) and a few other places.
Protocol amends the DTAA with effect from 1st April, 2017 to
Buhari Group has interests in construction, power, trading,
provide for source based taxation of capital gains arising on engineering, real estate and shipping. The group also owns a
transfer of shares in a company. This will curb revenue loss,
famous engineering college on the outskirts of Chennai.
prevent double non-taxation and streamline the flow of
investments. In order to provide certainty to investors, ETA Group too has interests in various sectors. Its operations are
investments in shares made before 1st April, 2017 have been spread across the country and abroad.
grandfathered subject to fulfillment of conditions in Limitation of
Benefits clause as per 2005 Protocol. Further, a two year (Click here to read more)
transition period from 1st April, 2017 to 31st March, 2019 has
been provided during which capital gains on shares will be taxed
in source country at half of normal tax rate, subject to fulfillment
of conditions in Limitation of Benefits clause.

The Third Protocol also inserts provisions to facilitate relieving of


economic double taxation in transfer pricing cases. This is a
ta pa er frie dl easure a d is i li e with I dia’s
commitments under Base Erosion and Profit Shifting (BEPS)
Action Plan to meet the minimum standard of providing Mutual
Agreement Procedure (MAP) access in transfer pricing cases. The

AKGVG Weekly Insight | 09thJanuary’ 17 | Page No. 1


for exports, subject to the specified conditions referred in S.
No. 284A of Notification No. 12/2012-Customs dated

Customs Act 01.03.2012.

CBEC notified deeper tariff concessions for specified goods


Declaration form to be filled by resident Indians & NRIs for imported from ASEAN
depositing Specified Bank Notes (SBNs) on arrival
CBEC via Notification no 63/2016-Cus,dt. 31-12-2016, has
Central Government has specified, the grace period for amended notification No. 46/2011-Customs dated 01.06.2011
tendering the SBNs as— for (a) who is a resident in India, the so as to provide deeper tariff concessions in respect of
period ending on the 31st day of March, 2017; and (b) who is specified goods when imported from ASEAN under the India-
not resident in India, the period ending on the 30th day of ASEAN Free Trade Agreement w.e.f. 01.01.2017 and to carry
June, 2017. out editorial changes as a result of HS 2017 changes.
For the period from up to 31.3.17 or 30.6.17, as applicable, a
declaration form will be needed to be filled by resident Deeper concessional rate of BCD for specified goods
Indians and Non-resident Indians coming to India and carrying imported under IJCEPA
SBNs for depositing these SBNs in the specified offices of RBI CBEC via Notification no 64/2016-Cus, dt. 31-12-2016, has
in India. At the airport/land customs stations etc on entry, further amended Notification No. 69/2011-Customs, dated
customs stamp on the said forms shall be affixed and the 29th July, 2011 so as to provide a deeper concessional rate of
same shall be submitted along with other documents to RBI basic customs duty in respect of tariff item 8408 20 20
offices. Circular no 60/2016-Cus,dt. 31-12-2016 [engines of a kind used for the propulsion of specified motor
vehicles – of cylinder capacity exceeding 250 cc] and 8708 40
CBEC has extended the Single Window Interface for 00 [gear box and parts thereof, of specified motor vehicles],
Facilitation of Trade (SWIFT) to Exports w.e.f. 1st of January, 2017, when imported under the India-
Japan Comprehensive Economic Partnership Agreement
The SWIFT project envisages that the importers and exporters
(IJCEPA) and to carry out editorial changes as a result of HS
would electronically lodge their customs clearance documents
2017 changes.
at a single point only with the customs. With the successful
implementation of SWIFT for import, CBEC via Circular no
CBEC notified deeper tariff concessions for specified goods
01/2017-Cus, dt. 04-01-2017, has proposed to implement
imported from Malaysia under IMCECA
online-release from Partner Government Agencies (PGAs) for
CBEC via Notification no 65/2016-Cus, dt. 31-12-2016, has
exports from 05/1/2017 onwards as a pilot at Chennai, Delhi
amended notification No. 53/2011-Customs dated 01st July,
and Mumbai Air cargo complexes for CITES/ wildlife items.
2011 so as to provide deeper tariff concessions in respect of
Under the pilot, shipping bills filed online on ICEGATE or
specified goods imported from Malaysia under the India-
through the service center will be referred to the concerned
Malaysia Comprehensive Economic Cooperation Agreement
agency, namely WCCB, online for a "No Objection Certificate'
(IMCECA) w.e.f. 01.01.2016 and to carry out editorial changes
(NOC), if any required. The selection of items to be referred to
as a result of HS 2017 changes.
any agency will be based on criteria specified by the agencies.
As in the case of imports, the list of Customs Tariff Heads
CBEC notifies deeper tariff concessions for specified goods
(CTHs) for which goods require NOC from the Wildlife Crime
imported from Korea under CEPA
Control Bureau, shall be published on ICEGATE
CBEC via Notification no 66/2016-Cus, dt. 31-12-2016, has
BCD exemption available to specific fabrics withdrawn amended notification No. 152/2009-Customs dated
31.12.2009 so as to provide deeper tariff concessions in
CBEC via Notification no 62/2016-Cus,dt. 31-12-2016, has respect of specified goods imported from Korea RP under the
withdrawn BCD exemption, available to specified fabrics, of India-Korea Comprehensive Economic Partnership Agreement
value equivalent to 1% of the FOB value of exports in the (CEPA) w.e.f. 01.01.2017 and to carry out editorial changes as
preceding financial year, for manufacture of textile garments a result of HS 2017 changes.

AKGVG Weekly Insight |09th January’ 17 | Page No. 2


ICAI on 04.01.2017 issued exposure draft of Revised SA 720
The Audito ’s Respo si ilities Relati g to Othe I fo atio
which is open for comments till 20.02.2017. This Standard on
Auditi g “A deals with the audito ’s espo si ilities elati g to
other information, whether financial or non-financial
i fo atio othe tha fi a ial state e ts a d the audito ’s
epo t the eo , i luded i a e tit ’s a ual epo t.
Foreign citizens can exchange banned notes till January 31 (Click here to read more)
The Reserve Bank has said foreign citizens can exchange foreign
currency notes for Indian currency up to the limit of Rs.5,000 a Exposure draft o The Co eptual Fra e ork for Ge eral
week till January 31. Earlier, RBI had permitted foreign citizens Purpose Financial Reporting by Local Bodies released
to exchange foreign exchange for Indian currency notes up to a
The Committee on Accounting Standards for local bodies of the
limit of Rs.5,000 a week till December 15, 2016 and later
Institute of Chartered Accountants of India has invited
extended the facility till December 31.(Click here to read more)
comments on various aspects of exposure draft of The
RBI issued clarification regarding Specified Bank Notes (SBNs) Conceptual Framework for General Purpose Financial Reporting
by Local Bodies alo g with the set of uestio s. The e posu e
There had been various estimates on SBNs tendered in certain draft is open for comments till 20. 01.2017.(Click here to read
sections. RBI clarified that the periodical SBN figures released more)
were based on aggregation of accounting entries done at the
large no of currency chests all over the country. Now that the
Scheme has come to an end on December 30, 2016, these
figures would need to be reconciled with the physical cash
balances to eliminate accounting errors/ possible double counts
etc. RBI has already initiated this process and till this is
completed any estimate may not indicate the actual numbers of MCA notified Companies (Removal of Names of Companies
the SBNs that have been returned. RBI is taking all steps to from the Register of Companies) Rules, 2016
complete the process expeditiously so as to release firm figures
of SBNs received at an early date.(Click here to read more) MCA has commenced provisions of section 248 to 252 of The
Companies Act, 2013 w.r.t. removal of names of companies
RBI enhanced cash withdrawal limits from the Register of Companies and notified relevant rules
simultaneously. However, e-Form STK 2 prescribed under the
The daily limit of withdrawal from ATMs has been increased
said rules, for making application to the Registrar of Companies
(within the overall weekly limits specified) with effect from
for removal of name of the company from the register of
January 01, 2017, from the existing Rs 2500/- to Rs 4500/- per
companies, is under development and would be deployed in
day per card. There is no change in weekly withdrawal limits.
some time.(Click here to read more)
Such disbursals should predominantly be in the denomination
of Rs 500.(Click here to read more) MCA introduced SPICe e-form

MCA has taken another bold initiative in Government Process


Re-engineering (GPR) and has launched Simplified Proforma for
Incorporating Company Electronically (SPICe) e-Form. Existing
INC-29 and INC-7 will be phased out and SPICe will be the sole,
implified & versatile form available for incorporation of a
company in India. (Click here to read more)
ICAI issued exposure draft of Re ised “A 720 The Auditor’s
Respo si ilities Relati g to Other I for atio

AKGVG Weekly Insight | 09th January’ 17 | Page No. 3


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considered as an advice or opinion, or otherwise, whatsoever. AKGVG & Associates
does not intend to advertise its services through this insight. AKGVG & Associates is not
responsible for any error or omission in this insight or for any action taken based on its
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AKGVG Weekly Insight | 09th January’ 17 | Page No. 4

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