Sunday, 21 January 2018

Direct Tax Collections for F.Y. 2017 - 2018 show Growth of 18.7 % up to 15th January, 2018

The provisional figures of Direct Tax collections up to15th January, 2018
show that net collections are at Rs. 6.89 lakh crore which is 18.7% higher than the net collections for the corresponding period of last year. 
The net Direct Tax collections represent 70.3% of the total Budget Estimates of Direct Taxes for F.Y. 2017-18 (Rs.9.8 lakh crore). 
Gross collections (before adjusting for refunds) have increased by 13.5% to Rs.8.11 lakh crore during April, 2017 to 15th January, 2018. 
Refunds amounting to Rs.1.22 lakh crore have been issued during April, 2017 to15th January, 2018.

Friday, 23 June 2017

CBDT clarification for Aadhar PAN compulsion

PRESS RELEASE New Delhi,10th June, 2017.

1.Honourable Supreme Court in its landmark judgement has upheld section 139AA of the Income Tax Act as constitutionally valid which required quoting of the Aadhaar number in applying for PAN as well as or filing of income tax returns.

2.The Court also held that the “Parliament was fully competent to enact Section 139AA of the Act and its authority to make this law was not diluted by the orders of this Court.”Therefore, no violation of the earlier Supreme Court orders were found in enacting the provision.

3.The Court has also held that section 139AA of the Act is not discriminatory nor it offends equality clause enshrined in Article 14 of the Constitution.

4.Section 139AA is also not violative of Article 19(1)(g) of the Constitution in so far as it mandates giving of Aadhaar number for applying PAN and in the income tax returns and linking PAN with Aadhaar number.

5.Section 39AA(1) of the IncomeTax Act as introduced by the Finance Act, 017 provides for mandatory quoting of Aadhaar/Enrolment ID of adhaar application form, for filing of return of income and for making an application for allotment of PAN with effect from 1stJuly, 2017.

6.Section 139AA(2) of the Income Tax Act provides that every person who has been allotted PAN as on the 1stday of July, 2017, and who is eligible to obtain Aadhaar, shall intimate his Aadhaar on or before a date to be notified by the Central Government. The proviso to section 39AA(2) provides that in case of non-intimation of Aadhaar, the PAN allotted to the person shall be deemed to be invalid from a date to be notified by the Central Government.

7.The Supreme Court has upheld section 139AA(1) which mandatorily requires quoting of Aadhaar for new PAN applications as well as for filing of returns.

Tuesday, 27 December 2016

Received notice from Income tax Department: Compliance of Non-filers Monitoring System (NMS) for AY 2015-16

Many of the taxpayers have recently received by email and/or post the following notice:

Compliance of Non-filers Monitoring System (NMS) for AY 2015-16 PAN:

Dear Taxpayer,

  As per our records, it is observed that you have not filed your Income Tax Return for Assessment Year 2015-16. Please submit your online response as under:
Step 1: Login to e-filing portal Login to e-filing portal at
Step 2: View Information summaryInformation summary can be viewed under compliance section on the portal. Mention if the information relates to other PAN
Step 3: Upload Return or submit detailsUpload the return on e-filing portal after paying due taxes. If return is already filed, submit details under 'Filing of Income tax return' under compliance section. You may keep the printout of submitted response for record.

 Non-filers with potential tax liabilities are identified and monitored under Non-filers Monitoring System (NMS). A "Step by Step Guide" for NMS is also available for detailed guidance on the e-filing portal home page under the 'Help' section. If you need any assistance in submitting the response, please call the e-filing toll free number 1800 4250 0025 or send an email on

e-filing Team for Compliance Management Cell
Income Tax Department

Q. Why have I received the above notice?
 A. The notice is received only because you have not filed your Income tax Return for FY 2014-15 till date. Since, the last due date (belated) to file such pending Return is fast approaching (31.03.2017), the Department proactively have sent a reminder to all such taxpayers.

Q. What do I need to do?
A. You need to calculate your tax liability and file the Income tax Return immediately. Failure to file an Income tax Return may expose you to penalty. Meanwhile, you can log in in your efiling portal and under Dashboard you'll see the pending compliances part. These pending compliance shall include the above mentioned notice. You need to click on the appropriate response which will be 'already filed the Return', 'not yet filed the Return', 'In the process of filing the Return' etc.

CA Niraj Mahajan, Pune 

Tax implication of Sale of Indian Residential propertyn by a NRI (Non Resident Indian)

Ive experienced many aspects of Sale of Residential property in India by a NRI.
Since its a long time held property, Long Term Capital Gain tax would be applicable. This can be calculated using Indexed cost of acquisition. Valuation needs to be done as on 01.04.1981 if your original purchase date is before 01.04.1981
Now, the tricky part. Since you are a NRI, the payment made to you will attract 20% TDS (Tax Deducted at Source) rate plus cess 3% on 20%. Thus effective rate of TDS will be 20.6% ON THE SALE AMOUNT!
So, if you sell a property for Rs.1,00,00,000 then the buyer needs to deduct Rs.20,60,000 and deposit with Government on your behalf. So, your considerable amount is lying with Govt. Lets say if your actual tax liability is only Rs.5,00,000 , then adjusting the TDS already done , your Rs.15,60,000 (20.6 - 5) is still lying with Dept. This Refund of Rs.15.6 lacs you can claim only by filing an Income tax Return whose due date is couple of months after end of Financial Year. Imagine your money locked up unnecessarily whereas you can do/invest in better options.
The way out is you need to approach your Tax officer to grant relief by reducing TDS rate from 20.6% to bare minimum possible say 1% or so.
You can claim exemption from Long Term Capital Gains if you reinvest the gains in another house property. However most of the NRIs dont do that and repatriate the funds at their location.
Other way to save tax is Invest in Capital Gain Bonds which has 3 year lock in period. You need to invest only the Gain amount and not full sale amount. The Bonds also gives you a payout of around 6%pa interest. The maximum an individual can invest in these bonds are Rs.50 lacs. Thus, if your Gain amount is Rs. 30 lacs and invest in Bonds Rs. 30 lacs you dont pay any tax.
Hope this gives you some idea about Sale of Property in India by a NRI.
Feel free to get in touch if you still have queries.
CA Niraj Mahajan, Pune

Friday, 9 December 2016

ICAI cautions its members regarding Demonetisation

Demonetisation Policy announced by Government of India- An Advisory for Members

As you may be aware, the ICAI has always been supportive of the bold initiatives taken by the Government in strengthening the economic growth of our country and also in its efforts to weed out black money and corruption from our country. The recent move of Government of India to demonetize the high value denomination currency as announced by the Hon’ble Prime Minister Shri Narendra Modi is a welcome step which has given a definitive boost to the economic growth and dealt a lethal blow to the parallel economy that has cast its ugly shadow on the nation’s economy for long. This move, it is believed, will not only eliminate black money, but will also choke the activities of anti-nationals from across the border financed by fake currency, ensuring inclusive growth and national security in one go.

However, it is a matter of grave concern and distress to our profession when certain news reports/video clippings have come in the public eye depicting certain Chartered Accountants indulging in such acts of illegality which goes against the efforts of the Government in eradicating the corruption and black money from business and commercial transactions. Needless to mention that ICAI is unsparing in its efforts to discipline such erring members. It may be mentioned that immediate steps have been