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AKGVG Weekly Insight

21st November, 2016

Coverage:

Income Tax Updates

Customs & Excise Updates

Weekly News

Regulatory Updates
Assembled & Edited by:
Team - AKGVG

AKGVG & Associates

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

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Income Tax officials unsure how to slap 200% penalty on
income mismatch, 14th November, 2016
As India struggles with demonetization, individuals and
businesses are using old currency notes to settle debts while
income tax officials are at a loss how to go about imposing 200%
penalty -- as announced by a senior finance ministry official -- on
such funds flowing into banks. (Click here to read more)
Income tax 30th amendment rules released dated 15th
November, 2016
CBDT has amended Rule 114B making quoting of PAN mandatory
for cash deposits exceeding Rs. 50,000 in one day or exceeding
Rs. 2.5 Lacs during 9 Nov. 2016 to 30 Dec. 2016. Also CBDT has
amended Rule 114E requiring Banks/ Co-op. Banks to submit
information in AIR about aggregate cash deposits of more than
Rs. 12.5 lacs in Current A/c or Rs. 2.5 Lacs in SB A/c during 9 Nov.
2016 to 30 Dec.2016.(Click here to read more)
Transactions in Relation to which Quoting PAN is Mandatory
Press release dated 17th November, 2016
The Income Tax Department prescribes a list of transactions for
which quoting of Permanent Account Number (PAN) is
mandatory. These are listed in Rule 114B of the Income Tax
Rules, 1962 which were first inserted with effect from 1st
November, 1998 and have been amended from time to
time.(Click here to read more)
India–USA Bilateral Competent Authority MAP/APA Meeting –
Resolution of more than 100 cases under MAP and Agreement
on terms and conditions of First ever Bilateral APA involving
India and USA
Press release dated 17th November, 2016
The Bilateral Competent Authority Mutual Agreement Procedure
(MAP) / Advance Pricing Agreement (APA) meeting between
India and USA was held in Washington DC, USA during the last
week of October, 2016. The discussions in the meeting were
AKGVG Weekly Insight | 21st November’ 16 | Page No. 1
focused on resolving MAP cases pending for a long time and to
achieve significant developments in Bilateral APA Process. (Click
here to read more)
Income tax notices to religious, charitable trusts, 17th
November, 2016
The Income-tax department has issued letter to dozen of
religious and charitable trusts, asking them to furnish details of
‘cash balances’ as on November 8, following the demonetization
of Rs 500 and Rs 1,000 currency notes.(Click here to read more)
Signing of Bilateral Advance Pricing Agreements (B- APAs)
Press release dated 18th November, 2016
The CBDT signed 3 bilateral APAs on 18th November, 2016 taking
the total number of APAs signed [both- bilateral and unilateral]
so far to 111. These agreements are a result of the
understanding reached with the Competent Authority of United
Kingdom some time ago. The Competent Authorities of India and
UK had earlier exchanged mutual agreements amongst them
under the Mutual Agreement Procedure (MAP) Article of the
India-UK Double Taxation Avoidance Convention (DTAC).(Click
here to read more)
Demonetization of Old High Denomination Currency & Cash
Deposits in Bank Accounts
Press release dated 18th November, 2016
It was announced by the Government earlier that small deposits
made in the banks by artisans, workers, housewives, etc. would
not be questioned by the Income Tax Department in view of the
fact that present exemption limit for Income Tax is Rs.2.5
lakh.(Click here to read more)
Income Tax men may come calling on gold buyers, 18th
November, 2016
The taxman may knock on your door if you bought gold
immediately before or after high denomination currency notes
were withdrawn - even if you paid for the precious metal by
cheque or credit card.(Click here to read more)
Income Tax department asks two Tata Trusts to explain
‘unlawful’ investments , 19th November, 2016
The Income-Tax department has asked two Tata Trusts to explain
investments flagged by Parliament’s Public Accounts Committee.
Further it is reopening the issue of tax exemption granted to one
of them, top I-T officials said on Friday. Tata Trust officials were
asked to explain themselves but they have sought more time.
(Click here to read more)
15 per cent service tax on music, movies and other
downloads from foreign sites,
Book, movies and other downloads from foreign sites will
become costlier starting December 1. The Central Board of
Excise and Customs (CBEC) has made amendments to the
existing Place of Provisions of Services Rules (PPSR) for online
information and database access or retrieval services. One will
have to pay an additional 15 per cent service tax on any
downloads from foreign websites starting from 1st December
2016.
Foreign OIDAR firms to pay service tax from December 1, 12th
November, 2016
Overseas companies providing OIDAR services which include
website hosting, film download, online advertisement and
newspaper subscriptions, will have to pay service tax from
December 1, 2016. In order to provide a level playing field to
Indian service providers, the revenue department has decided
to withdraw service tax exemption given to online service
providers located in foreign territory but providing taxable
online information and database access or retrieval [OIDAR]
services.
(Click here to read more)
AKGVG Weekly Insight |21st November’ 16 | Page No. 2
Notification No. 138/2016-Cus (NT), dt. 17-11-2016
Rate of exchange of conversion of the foreign currency with
effect from 18th November, 2016. (Click here to read more)
Notification No. 137/2016-Cus (NT), dt. 15-11-2016
Tariff Notification in respect of Fixation of Tariff Value of Edible
Oils, Brass Scrap, Poppy Seeds, Areca Nut, Gold and Sliver. (Click
here to read more)
Circular No. 53/2016, dated 18-11-2016
Regarding clearance of import of metal scrap-Procedure. (Click
here to read more)
Circular No. 52/2016, dated 15-11-2016
Regarding deferred payment of Customs duty. (Click here to read
more)
Ethiopian woman held, gold worth Rs 89L seized, 19th
November, 2016
Customs officials at IGI Airport arrested an Ethiopian woman for
allegedly trying to smuggle into the country over 3 kg of gold
worth Rs 89 lakh, along with $10,000 in cash, on Wednesday.
They also seized demonetised currency notes of Rs 1,000
amounting to Rs 60,000 from her.
Senior customs officials said that the woman, who arrived from
Addis Ababa, was arrested at IGI Airport for the second time.
Two months ago, she was caught with 650 grams of gold after
which she was released on bail.
(Click here to read more)
Banks to exchange notes only for own customers today
(Withdrawal, deposit and other banking services allowed; senior
citizens exempted)
Indian Banks’ Association (IBA) on Friday said banks on Saturday
will not exchange old Rs 500 and Rs 1,000 notes with the new
ones to perform other banking related duties, which have been on Usage of ATMs – Waiver of customer charges.14 NOV
hold since November 8.
The Reserve Bank of India has today decided that banks shall
Senior citizens would be exempted from this restriction. However, waive levy of ATM charges for all transactions (inclusive of both
a customer can still withdraw and deposit money at the counters. financial and non-financial transactions) by savings bank
A customer can withdraw up to Rs 24,000 in a window of seven customers done at their own banks’ ATMs as well as at other
days, starting from the first day of withdrawal. banks’ ATMs, irrespective of the number of transactions during
the month.
“All these days our own customers have suffered because we The above waiver of charges on ATM usage will be effective from
have not been able to do their work. So, we have seen lot of November 10, 2016 till December 30, 2016, subject to review.
pending work at branches, especially for our existing customers.
We, from IBA, have taken a view that on Saturday we shall be RBI cancels Licence of Sai Nagari Sahakari Bank Limited, Hadgaon
exclusively doing work for our own customers. And we will not be 17 NOV
doing exchange of notes (for outside customers),” said Rajeev
Rishi, chairman, IBA.(Click here to read more) The Reserve Bank of India has cancelled the licence issued to Sai
Nagari Sahakari Bank Limited, Hadgaon, consequent upon its
merger with Shankar Nagari Sahakari Bank Limited, Nanded with
Demonetisation: Govt tightens exchange of notes, eases effect from August 26, 2016. The Reserve Bank has done this
withdrawal under Section 22 of Banking Regulation Act, 1949 (As Applicable
to Cooperative Societies) (ACCS).
Amid reports of hardships caused by demonetisation in crop
sowing and marriages, the government on Thursday eased Cash Withdrawal at Point-of-Sale (POS) - Withdrawal limits and
restrictions on cash withdrawal by farmers and families with customer fee/charges- Relaxation- 18 NOV
upcoming weddings, but more than halved the limit of exchange
of notes at Rs 2,000. The Reserve Bank of India had issued instructions to banks
Economic Affairs Secretary Shaktikanta Das said now families on November 14, 2016 that banks shall waive levy of ATM charges
preparing for a wedding can withdraw up to Rs 2.50 lakh from for all transactions by saving bank customers done at all ATMs,
bank account, citing PAN details and self-declaration. irrespective of the number of transactions during the month, from
(Click here to read more) November 10, 2016 till December 30, 2016, subject to review.

UNION BUDGET TO BE PRESENTED ON FEB 1 As another customer-centric measure, the limit for cash
withdrawal at POS has been made uniform at to ₹ 2000/- per day
The Union Budget 2017-18 will be presented on February 1. The
across all centres (Tier I to VI) for all merchant establishments
inter-ministerial discussions for finalizing the Revised Budget enabled for this facility and (ii) customer charges, if any, being
Estimates have been completed, said a government source, levied on all such transactions waived till December 30, 2016,
adding it would not be impacted by the government decision to subject to review.
demonetize Rs 500 and Rs 1,000 notes. The government has
decided to advance the Budget process by a month to ensure it is It may be recalled that the Reserve Bank had vide its
completed before the start of the new financial year on April 1. circular DPSS.CO.PD.No.449/02.14.003/2015-16 dated August 27,
2015 permitted cash withdrawals at Point of Sales (POS) upto ₹
1000 in Tier I to II centres and upto ₹ 2000 in Tier III to VI centres.

AKGVG Weekly Insight | 21st November’ 16 | Page No. 3

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