New Form 26AS is the Faceless hand-holding of the Taxpayers
July 18, 2020: CBDT :The new Form 26AS is the faceless hand-holding of the taxpayers to e-file their income tax returns quickly and correctly. From the current AY, taxpayers will see an improved Form 26AS which would carry some additional details on taxpayers’ financial transactions as specified in the Statement of Financial Transactions in various categories.
CBDT issues detailed guidelines for implementation of Faceless Assessment Scheme
August 14, 2020: CBDT has laid down various guidelines for implementation of faceless assessment scheme.
The Taxation & Other Laws (Relaxation & Amendment of Certain Provisions) Bill, 2020
September 29, 2020: The Government of India notified the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 (TOLA) after receiving the President of India’s assent.The TOLA gives legislative effect to the relaxation in due dates for various tax compliances announced by the Government. Further, surcharge is capped on dividend income earned by Foreign Portfolio Investors. Please refer Alert for detailed updates.
ITAT – Allows TDS-credit to ’pass-through’ Venture-capital Trust, though income taxable in contributors’ hands
October 2, 2020: Mumbai ITAT holds assessee (a venture capitalTrust, a pass through enti claiming exemption on income from investments u/s. I 0(23FB)) entitled to TDS credit on TDS deducted on income from investments.
CBDT has now notified the Equalisation Levy (Amendment) Rules, 2020
The CBDT has now notified the EL (Amendment) Rules, 2020 (Rules), to amend the original EL Rules, 2016 dealing with the procedural framework for compliances and the appeals process to be followed for such levy. The amended Rules are effective from 28 October 2020.
Karnataka HC affirms Special Bench’s Biocon ruling allowing ESOP discount u/s 37
HC affirms ITAT Special Bench ruling and dismisses Revenue’s appeal, holds that discount on issue of ESOPs, i.e. diPerence between grant price and the market price on the shares as on the date of grant of options is allowable as deduction u/s.37 of the IT Act
56(2)(vii) on receipt of bonus shares not applicable
Karnataka HC held that when there is an issue of bonus shares, the money remains with the company and nothing comes to the shareholders as there is no transfer of the property and the provisions of section 56(2) (vii) are not attracted
Shares issued against book adjustments not an unexplained cash credit
Calcutta High Court, in its decision, had held that when the cash did not pass at any stage and since neither the respective parties received any cash nor paid any cash, there was no real credit of cash in the cash book and the question of inclusion of the amount of the entry as unexplained cash credit could not arise
Valuation method for sec 56(2)(viib) cannot be changed by AO
Delhi ITAT holds that Revenue cannot change the valuation method for determination of FMV of shares u/s 56(2)(viib) adopted by assessee, remits the matter for de novo adjudication based on DCF method adopted by assessee
Issue of CCPS at premium to a I”lauritius Investor is not taxable
Delhi ITAT held that there was no doubt about creditworthiness and genuineness of the investment made by the Investor and directed the AO to delete the addition under section 68 of the Act.
Explanation 6 to section 9 (Indirect Transfer provisions) of the Act is clarificatory in nature
Explanation 5 and 6 to section 9(I) of the Act shall apply on transfer of partnership interest
Extension of due date to file income tax return and other reports
The CBDT has on December 3 I , 2020 notified revised due dates for filing of income tax return and other reports under the provisions of the Act. The due date for Companies / partnership firms liable for audit under section 44AB / Assessee required to furnish report under section 92E is February 15, 202 I . Further, due date for furnishing the tax audit report and the report in respect of international/specified domestic transaction for AY 2020-2 I has been extended to january 15, 2021 .
Also, the last date for making declaration under Vivad se Vishwas Scheme and passing of orders under this scheme has also been extended to january 3 I, 202 I .
ITAT : ESOP exercised by NR, granted for employment in India, not eligible for treaty benefits
Mumbai ITAT rejects Assessee’s appeal for AY 20 I 3- 14 and 20 14- 15, denies treaty benefit u/s 90 on taxation of ESOP exercised by non-resident assessee, granted for employment in India; ITAT rejects assessee’s contention that ESOP was in connection with employment in Dubai and as such income did not accrue or arise in India u/ s 5(2) of the Act
CBDT notifies Faceless Penalty Scheme, 202I
SEBI (Alternative Investment Funds) (Amendment) Regulations, 2020
October 19, 2020: SEBI has amended the regulations pertaining to the Investment team and members of the Investment Committee of the SEBI AIF Regulations.
SEBI Guidance on minimum corpus required to be maintained at the AIF level
December 29, 2020: The Securities and Exchange Board of India (’SEBI’) provided Informal Guidance on the request of Scale Management Consultants LLP (the ‘Applicant’) under the SEBI (Alternative Investment Funds) Regulations, 2012 (’AIF Regulations’) on 29 December 2020 (the ’Informal Guidance’). A brief snapshot of the Informal Guidance is given below.
- SEBI Guidance: An angel fund is required to maintain the minimum corpus of INR 5 crore at the Fund level
- SEBI Guidance:The sponsor and the manager together can maintain minimum interest in an angel fund
Amendment to SEBI (AIF) Regulations 20I2
January 2021: To give elect to the October amendment, the SEBI has now vide its notification dated 8 january 2021, specified that the aforementioned conditions shall not apply to AIFs provided that each investor of the AIF (other than the manager, sponsor, employee/ director of the AIF/ investment manager) has:
°committed to invest not less than INR 70 crores; and
°furnished a letter of waiver, in the prescribed format.