Service Tax return required to be submitted by 25th October, 2012 shall cover period between April to June, 2012 only

0 comments Saturday, September 29, 2012
Rule 7 of the Service Tax Rules has been amended so as to provide that the Form ‘ST-3’ required to be submitted by the 25th day of October, 2012 shall cover the period between 1st April to 30th June, 2012 only.

It means that now the ST-3 return required to be filed by 25th October 2012 will be only for the period April-June, 2012 and not for the period of 6 months from April-September, 2012.

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Department cannot take advantage of assessee's ignorance-Bombay HC

0 comments Thursday, September 27, 2012
Bombay High Court in a very important case has held that  Income-tax Deptt. can't take advantage of assessee's mistakes in claiming exemption in IT return and deny him exemption.

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Section 44AB of Income Tax Act-certain points

0 comments Wednesday, September 26, 2012
Due date of filing Income tax return for assessees who are liable to get their books of accounts audited is 30th September. Since the due date is nearing, lets get some points refreshed on section 44AB.
Who has to get his accounts audited compulsorily:

1.A Person carrying on business is required to get his books of account compulsorily audited u/s 44AB If the total sales, turnover or gross receipt in business for the previous year relevant to assessment year exceed or exceeds Rs. 60 Lakh for the Assessment year 2011-12 and 2012-13 (Rs. 1 Crore from the assessment year 2013-14).
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Service tax on legal services under reverse charge mechanism stayed by Delhi High Court

0 comments Tuesday, September 25, 2012

Service Tax on Legal services under reverse charge mechanism  was imposed by Central Government w.e.f 01-07-2012. Thereby recepient of service, if its a business entity was made liable to pay service tax on the legal services received.

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C forms can be issued for purchase of goods used in telecommunication even if such goods not resold

0 comments Sunday, September 23, 2012

Andhra Pardesh High Court in a very important judgement namely Indus Towers Limited vs Commercial Tax officer has held that C forms can be issued for the purchase of goods used in the telecommunication network even if such goods are not resold.

The Hon'ble High Court held as under:

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Income tax and TDS rate on interest income of Non-resident reduced to 5%

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 Interest Income of a Non-Resident Investor will now be taxed at the reduced rate of 5 per cent instead of the existing rate of 20 per cent and withhold Tax on such Income has also been reduced to 5 per cent


Section 194LC of the Income-tax Act, 1961 – Income by way of Interest from Indian Company – Approval of loan agreements/long term infrastructure bonds and rate of interest for the purpose of Section 194LC

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CST (Punjab) Rules amended-Statutory forms under CST to be online

0 comments Saturday, September 22, 2012
Rule 7 of Central Sales Tax (Punjab) Rules has been amended to provide for the issuance of online statutory forms i.e C, F, H, E-I, E-II and I forms under Central Sales Tax Act, 1956. The rules provide for compulsory filing of returns in the Form-1 and VAT-18 and VAT-19 by every dealer registered under CST Act.

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Entry Tax in Punjab increased by 0.5% w.e.f 18-09-2012

0 comments Tuesday, September 18, 2012
Entry Tax rates has been enhanced by the Excise & Taxation Department, Punjab by 0.5% on all the goods w.e.f 18-09-2012. This increase has been made and also was expected after the increase in the VAT rates by 0.5% on almost all the goods under Punjab VAT Act, 2005. 

However no notification confirming the increase in entry tax rates is available as yet but a public notice to this effect has been issued which confirms the increase in the rates of entry tax rates w.e.f 18-09-2012.
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Cost Inflation Index for Financial year 2012-13 notified

0 comments Monday, September 17, 2012

Cost Inflation Index for financial year 2012-13 has been notified and the same is 852


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Scrutiny, audit, assessment processes under Punjab VAT to be handed over to external agencies

0 comments Saturday, September 15, 2012
Excise & Taxation Department, Punjab is looking forward to handover the scrutiny, audit and assessment process in the hands of some external agency for a limited period of 8 months to 1 year till the time the new system i.e. Compuerisation of Tax Information System (COTIS) is fully implemented.

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Transactions through MCX stock exchange are non-speculative after 01-04-2006

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Mumbai ITAT has held that the transactions carried out through MCX Stock Exchange after 1st April 2006, would be eligible for being treated as non-speculation within the meaning of clause (d) of proviso to section 43(5).  


It is held by ITAT in this case as follows : 
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No TDS on discount given to Stamp Vendors for purchasing stamps in bulk quantity

0 comments Tuesday, September 11, 2012
The assessee, an association of stamp vendors, bought stamps from the State Govt. at a discount. The department claimed that the stamp vendors were “agents” of the State Govt. and that the said discount was “commission or brokerage” and the State Govt. ought to deduct TDS u/s 194H. The assessee filed a Writ Petition to challenge the department’s action. The Gujarat High Court upheld the assessee’s plea that (a) title in the stamps passed to the vendors and that they were not “agents” of the State Govt. but were transacting on a “principal to principal” basis and (b) the discount available to the stamp vendors was not “commission or brokerage” so as to fall within s. 194H. On appeal by the department to the Supreme Court, HELD dismissing the appeal:
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Lower/Nil rate of tax deduction certificate for works contractors under Punjab VAT Act, 2005

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It is ussualy seen that works contractors registered under Punjab VAT Act, 2005 have always refund to claim from the Excise & Taxation department due to the fact that their final tax liability is much lower/Nil than the tax deductions made u/s 27 of Punjab VAT Act, 2005. It results in blocking of their working capital till the time they get refund from the Department.The solution to it is to resort to section 27(10) of Punjab VAT Act, 2005.

The relevant provisions of PVAT Act 2005 and certain relevant judgements have been discussed herebelow in this regard
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Processing fee levied on all VAT dealers, luxury tax, lump sum tax on brick klins doubled in Punjab

0 comments Wednesday, September 5, 2012
Excise & taxation Department, Punjab has levied processing fee of Rs. 800 on every taxable dealer (i.e Person having VAT registration) in Punjab under a new Rule 40-A of Punjab VAT Rules, 2005. This rule provides as under:

"Every taxable person shall pay annual processing fee of Rs. Eight Hundred only during the month of October alongwith the filing of quarterly return. This processing fee is in lieu of operation, maintenance and upgradation of such facilities and services as electronic issuance of statutory forms, e-filing of returns, e-payment of taxes and such other online and offline services being rendered or proposed to be rendered by the Excise and Taxation Department."
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House lacking basic amenities does not qualify for exemption u/s 54

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In the instant case, in order to examine the entitlement of the assessee for exemption under section 54, it is to be seen whether the assessee had constructed residential house within three years of the transfer of his property. For doing so, the meaning of the term ‘house’ is to be explored. The term ‘house’ has not been given any statutory definition and, thus, has to be assigned meaning as understood in common parlance. As per dictionary, it means abode, a dwelling place or building for human habitation. A building, in order to be habitable by a human being, is ordinarily required to have minimum facilities of washroom, kitchen, electricity, sewerage, etc.
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Powers u/s 8(3) of PVAT Act should be exercised in exceptional circumstances

0 comments Monday, September 3, 2012


Section 8(3) of Punjab VAT Act, 2005 provides that a prior 15 days notice is required to be issued by notification of intention to amend the schedules, before any schedules are amended. However the State Government may also dispense with the requirement of issuance of the prior notice if the circumstances so exist. Section 8(3) runs as under:
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Notifications relating to VAT increase by 0.5% in Punjab

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Punjab Government has increased the VAT rate by 0.5% on almost all goods under Punjab VAT Act, 2005 for which a public notice was issued earlier in the newspapers. Now the official notifications are available and  sharing the same herebelow for the benefit of all concerneds.

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VAT rate in Punjab increased by 0.5% w.e.f 03-09-2012

0 comments Sunday, September 2, 2012
Punjab Government has increased the rate of VAT on all goods in Punjab by 0.5% under the Punjab VAT Act, 2005 w.e.f 03-09-2012.

Thus the rate of tax on all the goods stand increased by 0.5% w.e.f 03-09-2012. For example in case of goods mentioned under Schedule B rate of tax would be now @ 5.5% and after adding surcharge @ 10% the rate of tax would be 6.05%.
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Punjab's traders may move HC against processing fee, e-TRIP

0 comments Saturday, September 1, 2012


 Traders in Punjab are mulling approaching the High Court against the state government's decision to levy new processing fee and e-TRIP system. "We are going to have a meeting soon in which the trading community and various industry associations will participate to collectively decide about next course of action which may also include approaching the (Punjab and Haryana) High Court, having protest rallies against the processing fee and e-TRIP," Punjab Pradesh Beopar Mandal, President, Amrit Lal Jain told PTI today. "We are already in touch with prominent High Court lawyers to give their opinion on how to go about against processing fee and e-TRIP," Mandal’s Secretary, Mohinder Aggarwal said. 
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