Saturday, May 20, 2017


The GST Council, the apex decision-making body for the new tax, has fixed the tax framework under the Goods and Services Tax (GST) which is to be rolled out this July 1. Tax rates have been finalized for 1,211 items with a majority of items being kept under the 18 per cent slab.       Here's a complete list of GST rate card.

 Nil rate (0%):

 No tax will be imposed on items like fresh meat, fish chicken, eggs, milk, butter milk, curd, natural honey, fresh fruits and vegetables, flour, besan, bread, prasad, salt, bindi. Sindoor, stamps, judicial papers, printed books, newspapers, bangles, handloom etc.

Such as fish fillet, cream, skimmed milk powder, branded paneer, frozen vegetables, coffee, tea, spices, pizza bread, rusk, sabudana, kerosene, coal, medicines, stent, lifeboats will attract tax of 5 percent.

12%  ITEMS

Frozen meat products , butter, cheese, ghee, dry fruits in packaged form, animal fat, sausage, fruit juices, Bhutia, namkeen, Ayurvedic medicines, tooth powder, agarbatti, colouring books, picture books, umbrella, sewing machine, and cellphones will be under 12 per cent tax slab.

18%: ITEMS

Most items are under this tax slab which include flavoured refined sugar, pasta, cornflakes, pastries and cakes, preserved vegetables, jams, sauces, soups, ice cream, instant food mixes, mineral water, tissues, envelopes, tampons, note books, steel products, printed circuits, camera, speakers and monitors.

 28% ITEMS

Chewing gum, molasses, chocolate not containing cocoa, waffles and wafers coated with choclate, pan masala, aerated water, paint, deodorants, shaving creams, after shave, hair shampoo, dye, sunscreen, wallpaper, ceramic tiles, water heater, dishwasher, weighing machine, washing machine, ATM, vending machines, vacuum cleaner, shavers, hair clippers, automobiles, motorcycles, aircraft for personal use, and yachts will attract 28 per cent tax - the highest under GST system.

Source: Economic Times

Compiled By:
CA Narinder Gupta
47- Near New Judicial Court Complex,
Opposite Judge’s Residence Gate
Rajpura – 140401

Thursday, January 7, 2016

Income tax department extends ITR-V verification deadline till 31st January

If you missed your 120 days ITR-V verification deadline, there is good news. The income tax department has extended the verification deadline till 31st January. Although it has not been officially notified yet, taxpayers having been receiving this information via email from the I-T department. However, you won't be able to e-verify. Like old times, will have to physically mail the signed ITR V to CPC Bangalore. "The electronic verification option gets switched-off automatically after 120 days of the taxpayer filing the return. However, the extended deadline to physically submit the ITR-V is open for all," says Archit Gupta, founder and CEO, The 120 days countdown begins from the date the taxpayer submits their income tax returns forms. The tax department had extended the filing deadline to September 7 this year. So, people who had filed on the last date still have a window of one day to e-verify. Post that you too will have to mail the ITR-V. The last date to do so will still remain 31st January. Many individuals who, who had e-verified their return using Aadhar or Net banking, are receiving reminder letters from the CPC at Bangalore to physically send their ITR-V acknowledgement forms on or before the 31st of January 2016. "Those trying to e-verify their return once again with reference to the above are getting the message "No returns pending for e-verification" when they try to do so," says Varun Advani, COO, CAs advice them to re-send their ITRVs physically to the department before the deadline to avoid any further problems.

Source: Economic Times
Compiled By:
CA Narinder Gupta
47- Near New Judicial Court Complex,
Opposite Judge’s Residence Gate
Rajpura – 140401

Thursday, December 31, 2015


The Central Board of Direct Taxes (CBDT), with a view of widening the tax net has notified new rules regarding mandatory quoting of PAN for specified transactions, under Rule 114B.These rules will be applicable from 1st Day of January, 2016.

A chart highlighting the key changes to Rule 114B of the Income Tax Act  is attached hereunder:


Immovable property
Sale/ purchase valued at Rs.5  lakh or more
i.     Sale/ purchase exceeding Rs.10 lakh;
ii.   Properties valued by Stamp  valuation authority at amount exceeding Rs.10 lakh will also  need PAN.

Motor Vehicle ( Other than two wheeler)

All Sales/ Purchases
  No Change
Time Deposit
Time Deposit exceeding Rs. 50,000/- with a banking company
i.     Deposit with Co-op banks, Post Office, Nidhi, NBFC companies will also need PAN:
ii.   Deposits aggregating to more than Rs. 5 Lakh during the year will also need PAN:
Deposit  with  Post  Office Savings Bank

Exceeding Rs.50,000/-
Sale or purchase of securities
Contract  for sale/ purchase of a value exceeding Rs.1 lakh

No change

Opening an account ( other than time deposit)  with a banking company
All new accounts.
i.  Basic savings Bank Deposit Account excluded ( No PAN requirement for opening these accounts);
ii. Co-operative banks  also to comply
Installation  of  telephone/ cellphone connections
All instances
Hotel/restaurant bill(s)
 Exceeding Rs.25,000/- at any one time (by any mode of payment)
Cash  payment  exceeding Rs.50,000/-.
Cash  purchase  of  bank drafts/ pay orders/ banker's cheques
Amount  aggregating
 to Rs.50,000/-  or  more during any one day

Exceeding Rs.50,000/- on any one day.
Cash deposit with banking company
Cash  aggregating  to Rs.50,000/-  or  more during any one day
Cash Deposit exceeding Rs.50,000/- in a day
Foreign travel
Cash  payment  in connection with foreign travel   of  an  amount exceeding Rs.25,000/- at any one time (including fare, payment to travel agent, purchase of forex)
Cash payment in connection with foreign  travel or  purchase  of foreign currency of an amount exceeding Rs.50,000/- at any one time (including fare, payment to travel agent)

Credit card
Application  to  banking company/  any  other company /institution  for credit card
No change.
 Co-operative  banks  also  to comply
 Mutual fund units
Payment of Rs.50,000/or more
 for purchase
Payment exceeding Rs.50,000/for purchase.

Shares of company
Payment of Rs.50,000/- or more to a company for acquiring its shares
i.     Opening a demat account;
ii.    Purchase or sale of shares of an unlisted company for an amount exceeding Rs.1 lakh per transaction.

Debentures/ bonds
Payment of Rs.50,000/ or more to a company/ institution for acquiring its debentures/ bonds
Payment exceeding Rs.50,000/-.

RBI bonds
Payment  of Rs.50,000/-or  more  to RBI  for  acquiring  its bonds

Payment exceeding Rs.50,000/-.

Life insurance premium
Payment of Rs.50,000/or more in a year as premium  to an insurer
Payment exceeding Rs.50,000/in a year.

Purchase of jewellery/bullion
Payment of Rs.5 lakh or more at any one time or against a bill
Deleted and merged with next item in this table
Purchases or sales of goods or services

No requirement
Purchase/ sale of any goods or services exceeding Rs.2 lakh per transaction.

Cash  cards/  prepaid instruments  issued  under Payment and Settlement Act
No requirement
Cash  payment  aggregating  to more than Rs.50,000 in a year.

Source: Press Information Bureau
Compiled by:
CA Narinder Gupta
47- Near New Judicial Court Complex,
Opposite Judge’s Residence Gate
Rajpura – 140401
9779023228, 9417023228

Sunday, December 13, 2015

Employers likely to pay service-tax on forfeiture of retention bonus or deposits of employees

Employers shell out various rewards besides regular salary to retain talented employees. Usually they offers retention bonus to talented employees. In some cases, employers collect security deposits from employees which could be forfeited if employee is unable to serve the specified period.
Recently a directive has been issued to alert field officials on an all-India basis to keep check on amount received or forfeited by employers from their employees. Now the service-tax department wants to tax amounts received by the employer from employee treating the same as consideration received in lieu of providing service by letting employees to leave ahead of time. Therefore, employers could become liable to pay service tax on retention bonuses or money taken back from the employees.
According to section 66E of the Finance Act, 1994, agreeing to the "obligation to refrain from an act, or to tolerate an act or a situation, or to do an act" constitutes a service. This covers the return or forfeiture of money ahead of the stipulated notice or bond period and thus service tax could be levied.

Compiled By:
CA Narinder Gupta
47- Near New Judicial Court Complex,
Opposite Judge’s Residence Gate
Rajpura – 140401

Saturday, December 12, 2015


A panel headed by Chief Economic Adviser Arvind Subramanian has recommended that the 1% tax proposed to be levied on the goods and services tax (GST) on inter-state trade of goods to help manufacturing states be done away with. This is one of the major demands of the opposition Parties and the recommendation could help the government break the GST deadlock in Parliament.

In a report submitted to Finance Minister on Friday, the 3rd December 2015, the committee recommended the main or standard GST rate be in the range of 16.9% to 18.9 %. Rather it prefers it to be between 16.9% and 17.7 %. The standard rate will apply to most goods and services in the new indirect tax regime. These rates were calculated by excluding real estate, electricity, alcohol and petroleum products.

a)       16.9% - 18.9% is the standard rate, to be applicable on most goods & services.
b)       12% to be the lower rate.
c)       40% to be the highest rate, to be imposed on demerit goods such   
         as alcohol.
d)       15% to 15.5% to be the revenue-neutral rate.

The panel also recommended other rates, with the lower rate for goods at 12% 
and the highest rate at 40%. The highest rate is for demerit goods such as
alcohol, luxury cars, tobacco, etc.

However  panel has not identified which items will be treated as luxury/
demerits goods. In such case it is feared, that list of such goods, may be
expanded by including other items which is not desirable.

The panel recommended the rate on precious metals in the range of 2% to 6%.
As this rate increases, the main GST rate should come down. The panel  also
Said Petroleum , alcohol, real estate and electricity should be brought under
GST at an early stage. According to the Constitution amendment Bill on GST,
petroleum will be kept out till the proposed GST Council can decide on it.
Alcohol and a few other items are to be kept out of GST, according to the Bill.
The panel also advocated against putting any rate in the Constitution
amendment Bill.

The  panel’s report on GST has also pointed out the complexity and lags in the
GST implementation require that any evaluation – and  any consequential
 decisions – should not be undertaken over short horizons (Say months)  but over longer periods say 1-2 years. The report says for example, if six months into implementation,  revenues are seen be falling a litle short, there should not be a hasty decision to raise rates untill such time as it becomes clear that the shortfall is not due to implementation.
The report has underlined the fact that the GST represents a historic oppurtunity to rationalize the tax system. The GST will subsume state value-added taxes and central excise and services tax besides local levies. At present, the states impose VAT at 4% and 12.5%. Many states have increased their lower VAT rate to five per cent and upper VAT rate to 13%. The Centre levies excise and service tax at 14 % each. The present tax system is a complicated one and has become an “Exemptions Raj” rife with oppurtunities for slectivity and discrtion. It has estimated exemptions at Rs. 3.2 lakh crore or 2.5% of GDP.

The Subramanian committee estimated the revenue-neutral rate of the
GST At 15%. This is the rate at which the states and the Centre will not
lose or Gain revenue after the GST is applied.

The 1% tax was proposed in the constitution amendment Bill to bring all the
Manufacturing states like Gujarat, Maharashtra and Tamil Nadu on board.  Subramanian Panel, too, had criticised the proposed levy. "Think of a good (product) going from Gujarat to Tamil Nadu, crossing four states. The good would embody an additional tax of about four per cent to five per cent, because it is one per cent for every state. That might make it easier to import into Tamil Nadu from Bangkok," he had said.

The tax had the potential to undermine “Make in India, by making in India” he had said, adding, "That is why we need to look at this provision carefully. This period that we have gained, some of these issues need to be looked at again."  Briefing reporters later, Subramanian said allocation of the standard rate between the Centre and states would be decided by the GST Council. The council will be set up after the constitution amendment Bill is passed by Parliament and approved by at least 15 of 29 states.

The council will be made up of the Union finance minister and state finance ministers, with one-third power with the former and two-thirds with the latter. Any decision can be taken with the three-fourths of members present and voting. The final decision on the rate could only come from the policy choice that the GST Council made for the rate structure and exemption limits. This report will go to the GST council and then important policy decisions will have to be made on some of the parameters.

Earlier, a sub-committee of the empowered committee of state finance ministers had suggested a revenue-neutral GST rate of almost 27%. While the state GST component was proposed to be 13.91%, the central component was to be 12.77%. The committee had also proposed a narrow band for the state GST component.

Compiled By:
CA Narinder Gupta
47- Near New Judicial Court Complex,
Opposite Judge’s Residence Gate
Rajpura – 140401