CA. PRAMOD JAINFCA, FCS, FCMA, LL.B, MIMA, DISA

CA. PRAMOD JAINFCA, FCS, FCMA, LL.B, MIMA, DISA

LUNAWAT & CO.Chartered Accountants

LUNAWAT & CO.Chartered Accountants

3rd February 2017, Nehru Place3rd February 2017, Nehru Place

MAJOR

Income Tax Proposals

in

UNION BUDGET 2017

MAJOR

Income Tax Proposals

in

UNION BUDGET 2017

Lunawat & Co.

THE CRUX…THE CRUX…THE CRUX…THE CRUX…

Lunawat & Co.

TIMELY FILING OF RETURNSTIMELY FILING OF RETURNSTIMELY FILING OF RETURNSTIMELY FILING OF RETURNS

• No exemptions if return not filed No exemptions if return not filed No exemptions if return not filed No exemptions if return not filed

within due date in case of:within due date in case of:within due date in case of:within due date in case of:• Charitable Trusts u/s 12ACharitable Trusts u/s 12ACharitable Trusts u/s 12ACharitable Trusts u/s 12A

• Political Parties u/s 13APolitical Parties u/s 13APolitical Parties u/s 13APolitical Parties u/s 13A

• Time for furnishing of revised return Time for furnishing of revised return Time for furnishing of revised return Time for furnishing of revised return

---- end of the relevant AY or before the end of the relevant AY or before the end of the relevant AY or before the end of the relevant AY or before the

completion of assessment, completion of assessment, completion of assessment, completion of assessment,

whichever is earlierwhichever is earlierwhichever is earlierwhichever is earlier

Lunawat & Co.

FILING OF RETURNS / ASSESSMENTFILING OF RETURNS / ASSESSMENTFILING OF RETURNS / ASSESSMENTFILING OF RETURNS / ASSESSMENT

• No exemptions if return not filed in case of:No exemptions if return not filed in case of:No exemptions if return not filed in case of:No exemptions if return not filed in case of:• Specified Person u/s 10(23AAA)Specified Person u/s 10(23AAA)Specified Person u/s 10(23AAA)Specified Person u/s 10(23AAA)

• Investor Protection Fund u/s 10(23EC) /(23ED),Investor Protection Fund u/s 10(23EC) /(23ED),Investor Protection Fund u/s 10(23EC) /(23ED),Investor Protection Fund u/s 10(23EC) /(23ED),

• Core Settlement Guarantee Fund u/s 10(23EE) Core Settlement Guarantee Fund u/s 10(23EE) Core Settlement Guarantee Fund u/s 10(23EE) Core Settlement Guarantee Fund u/s 10(23EE)

• Any Board or Authority u/s 10(29A) Any Board or Authority u/s 10(29A) Any Board or Authority u/s 10(29A) Any Board or Authority u/s 10(29A)

• For AY 2018For AY 2018For AY 2018For AY 2018----19 time limit for making 19 time limit for making 19 time limit for making 19 time limit for making

assessment order u/assessment order u/assessment order u/assessment order u/ssssssss 143 or 144 143 or 144 143 or 144 143 or 144

reduced from existing 21 months to 18 reduced from existing 21 months to 18 reduced from existing 21 months to 18 reduced from existing 21 months to 18

months from the end of AY, and for the AY months from the end of AY, and for the AY months from the end of AY, and for the AY months from the end of AY, and for the AY

2019201920192019----20 and onwards, 12 months from the 20 and onwards, 12 months from the 20 and onwards, 12 months from the 20 and onwards, 12 months from the

end of the AY. Same for 147 / 158BCend of the AY. Same for 147 / 158BCend of the AY. Same for 147 / 158BCend of the AY. Same for 147 / 158BC

Lunawat & Co.

RECTIFICATIONRECTIFICATIONRECTIFICATIONRECTIFICATION

• S. 155 credit for foreign taxes paid is not S. 155 credit for foreign taxes paid is not S. 155 credit for foreign taxes paid is not S. 155 credit for foreign taxes paid is not

given in relevant AY in case of a dispute, given in relevant AY in case of a dispute, given in relevant AY in case of a dispute, given in relevant AY in case of a dispute,

AO shall rectify the assessment order or AO shall rectify the assessment order or AO shall rectify the assessment order or AO shall rectify the assessment order or

intimation u/s 143(1) within 6 months intimation u/s 143(1) within 6 months intimation u/s 143(1) within 6 months intimation u/s 143(1) within 6 months

from end of month in which dispute is from end of month in which dispute is from end of month in which dispute is from end of month in which dispute is

settled on furnishing of proof by settled on furnishing of proof by settled on furnishing of proof by settled on furnishing of proof by assesseeassesseeassesseeassessee

regarding settlement of dispute and regarding settlement of dispute and regarding settlement of dispute and regarding settlement of dispute and

undertaking that credit has not been undertaking that credit has not been undertaking that credit has not been undertaking that credit has not been

claimed of such foreign tax paidclaimed of such foreign tax paidclaimed of such foreign tax paidclaimed of such foreign tax paid

Lunawat & Co.

TIMELY COMPLIANCESTIMELY COMPLIANCESTIMELY COMPLIANCESTIMELY COMPLIANCES� Fee introduced for late filing of returns u/s 234FFee introduced for late filing of returns u/s 234FFee introduced for late filing of returns u/s 234FFee introduced for late filing of returns u/s 234F

�Late but by 31st December Late but by 31st December Late but by 31st December Late but by 31st December –––– RsRsRsRs. 5000/. 5000/. 5000/. 5000/----

�After 31st December After 31st December After 31st December After 31st December –––– RsRsRsRs. 10000/. 10000/. 10000/. 10000/----

�However, if However, if However, if However, if TI < TI < TI < TI < RsRsRsRs. . . . 5 Lakhs 5 Lakhs 5 Lakhs 5 Lakhs –––– RsRsRsRs. 1000. 1000. 1000. 1000

� S. 44AD amended to provide deeming profit of S. 44AD amended to provide deeming profit of S. 44AD amended to provide deeming profit of S. 44AD amended to provide deeming profit of

6% in case of 6% in case of 6% in case of 6% in case of amount of total turnover or gross amount of total turnover or gross amount of total turnover or gross amount of total turnover or gross

receipts received receipts received receipts received receipts received by an account payee cheque or by an account payee cheque or by an account payee cheque or by an account payee cheque or

an account payee bank draft or use of electronic an account payee bank draft or use of electronic an account payee bank draft or use of electronic an account payee bank draft or use of electronic

clearing system through a bank account clearing system through a bank account clearing system through a bank account clearing system through a bank account

� during during during during the previous year or before the due date the previous year or before the due date the previous year or before the due date the previous year or before the due date

specified in 139(1)specified in 139(1)specified in 139(1)specified in 139(1)

Lunawat & Co.

CASH RESTRICTIONSCASH RESTRICTIONSCASH RESTRICTIONSCASH RESTRICTIONS

• Deduction u/s 80G restricted if donation in Deduction u/s 80G restricted if donation in Deduction u/s 80G restricted if donation in Deduction u/s 80G restricted if donation in

cash exceeding cash exceeding cash exceeding cash exceeding RsRsRsRs. 2000 by a person (old 10k). 2000 by a person (old 10k). 2000 by a person (old 10k). 2000 by a person (old 10k)

• Expenditure u/s 40A(3) / 40A(3A) disallowed Expenditure u/s 40A(3) / 40A(3A) disallowed Expenditure u/s 40A(3) / 40A(3A) disallowed Expenditure u/s 40A(3) / 40A(3A) disallowed

in payment made in cash exceeding in payment made in cash exceeding in payment made in cash exceeding in payment made in cash exceeding RsRsRsRs. . . .

10000/10000/10000/10000/---- per person per day (Old 20k)(Old 20k)(Old 20k)(Old 20k)

• Depreciation disallowed on cash component of Depreciation disallowed on cash component of Depreciation disallowed on cash component of Depreciation disallowed on cash component of

asset cost exceeding asset cost exceeding asset cost exceeding asset cost exceeding RsRsRsRs. 10000/. 10000/. 10000/. 10000/---- per person per person per person per person

per day. CG?per day. CG?per day. CG?per day. CG?

• S. 35AD benefit not allowed on expenditure S. 35AD benefit not allowed on expenditure S. 35AD benefit not allowed on expenditure S. 35AD benefit not allowed on expenditure

incurred exceeding incurred exceeding incurred exceeding incurred exceeding RsRsRsRs. 10000/. 10000/. 10000/. 10000/---- per person

per day

Lunawat & Co.

CASH RESTRICTIONSCASH RESTRICTIONSCASH RESTRICTIONSCASH RESTRICTIONS

• S. 269 ST inserted S. 269 ST inserted S. 269 ST inserted S. 269 ST inserted w.e.fw.e.fw.e.fw.e.f. 1.4.17. 1.4.17. 1.4.17. 1.4.17

• NNNNo person to receive an amount person to receive an amount person to receive an amount person to receive an amount > > > > RsRsRsRs. 3 L in . 3 L in . 3 L in . 3 L in

cashcashcashcash

• in aggregate from a person in a day;in aggregate from a person in a day;in aggregate from a person in a day;in aggregate from a person in a day;

• in respect of a single transaction; orin respect of a single transaction; orin respect of a single transaction; orin respect of a single transaction; or

• in respect of transactions relating to one in respect of transactions relating to one in respect of transactions relating to one in respect of transactions relating to one

event or occasion from a personevent or occasion from a personevent or occasion from a personevent or occasion from a person

• Not to apply to Govt., bank, post office savings Not to apply to Govt., bank, post office savings Not to apply to Govt., bank, post office savings Not to apply to Govt., bank, post office savings

bank or cobank or cobank or cobank or co----operative bank, S. 269SS operative bank, S. 269SS operative bank, S. 269SS operative bank, S. 269SS

transactionstransactionstransactionstransactions

• Penalty of equal amount u/s 271DAPenalty of equal amount u/s 271DAPenalty of equal amount u/s 271DAPenalty of equal amount u/s 271DA

Lunawat & Co.

TAX RATESTAX RATESTAX RATESTAX RATES� No. of ITR filersNo. of ITR filersNo. of ITR filersNo. of ITR filers

� Individuals, HUF, AOP, BOI & AJP Individuals, HUF, AOP, BOI & AJP Individuals, HUF, AOP, BOI & AJP Individuals, HUF, AOP, BOI & AJP –––– 1st Slab 1st Slab 1st Slab 1st Slab –––– 5%5%5%5%

� Surcharge Surcharge Surcharge Surcharge

� @ 10% from @ 10% from @ 10% from @ 10% from RsRsRsRs. 50 Lakhs to . 50 Lakhs to . 50 Lakhs to . 50 Lakhs to RsRsRsRs. 1 Cr.. 1 Cr.. 1 Cr.. 1 Cr.

� @ 15% above @ 15% above @ 15% above @ 15% above RsRsRsRs. 1 Cr.. 1 Cr.. 1 Cr.. 1 Cr.

� Rebate u/s 87A Rebate u/s 87A Rebate u/s 87A Rebate u/s 87A –––– from from from from RsRsRsRs. 5000 to . 5000 to . 5000 to . 5000 to RsRsRsRs. 2500 with . 2500 with . 2500 with . 2500 with

income limit reduced from income limit reduced from income limit reduced from income limit reduced from RsRsRsRs. 5 Lakhs to . 5 Lakhs to . 5 Lakhs to . 5 Lakhs to RsRsRsRs. 3.50 L. 3.50 L. 3.50 L. 3.50 L

S. No.S. No.S. No.S. No. Type of CompanyType of CompanyType of CompanyType of Company Tax RateTax RateTax RateTax Rate

1111 Companies whose total turnover or gross Companies whose total turnover or gross Companies whose total turnover or gross Companies whose total turnover or gross

receipts in the previous year 2015receipts in the previous year 2015receipts in the previous year 2015receipts in the previous year 2015----16 does 16 does 16 does 16 does

not exceed not exceed not exceed not exceed RsRsRsRs. 50 Crores. 50 Crores. 50 Crores. 50 Crores

25%25%25%25%

2222 All Other domestic companies All Other domestic companies All Other domestic companies All Other domestic companies 30%30%30%30%

Lunawat & Co.

ADVANCE TAX /REFUNDADVANCE TAX /REFUNDADVANCE TAX /REFUNDADVANCE TAX /REFUND� Single advance tax installment for S. 44ADA too.Single advance tax installment for S. 44ADA too.Single advance tax installment for S. 44ADA too.Single advance tax installment for S. 44ADA too.

� No No No No InttInttInttIntt. . . . u/s 234C u/s 234C u/s 234C u/s 234C if PGBP 1st time if PGBP 1st time if PGBP 1st time if PGBP 1st time –––– conditions conditions conditions conditions

for 44ADA toofor 44ADA toofor 44ADA toofor 44ADA too

� No No No No inttinttinttintt. u/s 234C if dividend . u/s 234C if dividend . u/s 234C if dividend . u/s 234C if dividend u/s 115BBDA u/s 115BBDA u/s 115BBDA u/s 115BBDA

subject subject subject subject to fulfilment of conditions specifiedto fulfilment of conditions specifiedto fulfilment of conditions specifiedto fulfilment of conditions specified

� Interest on refund u/s 244A not be allowed for Interest on refund u/s 244A not be allowed for Interest on refund u/s 244A not be allowed for Interest on refund u/s 244A not be allowed for

period period period period for which for which for which for which delay delay delay delay attributable to attributable to attributable to attributable to deductordeductordeductordeductor

� New New New New s. s. s. s. 241A 241A 241A 241A ---- refund refund refund refund processed u/s processed u/s processed u/s processed u/s 143(1) 143(1) 143(1) 143(1) ---- AO AO AO AO

may, may, may, may, for for for for reasons recorded in writing reasons recorded in writing reasons recorded in writing reasons recorded in writing & & & & with with with with

previous previous previous previous approval of approval of approval of approval of Pr. CIT / CIT, withhold Pr. CIT / CIT, withhold Pr. CIT / CIT, withhold Pr. CIT / CIT, withhold refund refund refund refund

uptouptouptoupto assessmentassessmentassessmentassessment

Lunawat & Co.

TDSTDSTDSTDS�S. S. S. S. 194 194 194 194 –––– IB introduced for rent payments IB introduced for rent payments IB introduced for rent payments IB introduced for rent payments

�W.e.fW.e.fW.e.fW.e.f. 1.6.2017. TDS . 1.6.2017. TDS . 1.6.2017. TDS . 1.6.2017. TDS @ 5%@ 5%@ 5%@ 5%

�DeductorDeductorDeductorDeductor to be Individual /HUF (other than u/s 194 I).to be Individual /HUF (other than u/s 194 I).to be Individual /HUF (other than u/s 194 I).to be Individual /HUF (other than u/s 194 I).

� Exceeding Exceeding Exceeding Exceeding RsRsRsRs. 50k p.m.. 50k p.m.. 50k p.m.. 50k p.m.

� TDS only once in a yearTDS only once in a yearTDS only once in a yearTDS only once in a year

�No TAN requirementNo TAN requirementNo TAN requirementNo TAN requirement

� If 206AA applicable tax not to exceed last month rentIf 206AA applicable tax not to exceed last month rentIf 206AA applicable tax not to exceed last month rentIf 206AA applicable tax not to exceed last month rent

� Is Mr. A having turnover Is Mr. A having turnover Is Mr. A having turnover Is Mr. A having turnover RsRsRsRs. 1.50 Cr u/s 44AD . 1.50 Cr u/s 44AD . 1.50 Cr u/s 44AD . 1.50 Cr u/s 44AD

covered? No tax audit in this case.covered? No tax audit in this case.covered? No tax audit in this case.covered? No tax audit in this case.

� Is Is Is Is Mr. Mr. Mr. Mr. B B B B having turnover having turnover having turnover having turnover RsRsRsRs. . . . 80Lacs not covered 80Lacs not covered 80Lacs not covered 80Lacs not covered u/s u/s u/s u/s

44AD 44AD 44AD 44AD covered, hence covered u/s 44AB covered? covered, hence covered u/s 44AB covered? covered, hence covered u/s 44AB covered? covered, hence covered u/s 44AB covered?

Lunawat & Co.

TDSTDSTDSTDS�S. S. S. S. 194 LC 194 LC 194 LC 194 LC –––– 5% TDS on interest on ECB 5% TDS on interest on ECB 5% TDS on interest on ECB 5% TDS on interest on ECB ––––

borrowing date extended from 1.7.2017 to borrowing date extended from 1.7.2017 to borrowing date extended from 1.7.2017 to borrowing date extended from 1.7.2017 to

1.7.20201.7.20201.7.20201.7.2020

�S. S. S. S. 194 LD 194 LD 194 LD 194 LD –––– 5% TDS on interest to FII & QFI 5% TDS on interest to FII & QFI 5% TDS on interest to FII & QFI 5% TDS on interest to FII & QFI

–––– borrowing date extended from 1.7.2017 borrowing date extended from 1.7.2017 borrowing date extended from 1.7.2017 borrowing date extended from 1.7.2017

to to to to 1.7.20201.7.20201.7.20201.7.2020

�194J 194J 194J 194J ---- TDS reduced to 2% from 10% in case TDS reduced to 2% from 10% in case TDS reduced to 2% from 10% in case TDS reduced to 2% from 10% in case

of of of of business of business of business of business of operation of call centeroperation of call centeroperation of call centeroperation of call center

�Deduction u/s 57 not allowed if no TDS (if Deduction u/s 57 not allowed if no TDS (if Deduction u/s 57 not allowed if no TDS (if Deduction u/s 57 not allowed if no TDS (if

applicable) applicable) applicable) applicable) –––– s. 40(a)(s. 40(a)(s. 40(a)(s. 40(a)(iaiaiaia) added in S. 58) added in S. 58) added in S. 58) added in S. 58

Lunawat & Co.

TDSTDSTDSTDS�S. S. S. S. 194LA to provide that no deduction shall 194LA to provide that no deduction shall 194LA to provide that no deduction shall 194LA to provide that no deduction shall

be made where payment is made in respect be made where payment is made in respect be made where payment is made in respect be made where payment is made in respect

of any award or agreement which has been of any award or agreement which has been of any award or agreement which has been of any award or agreement which has been

exempted from levy u/s 96 (except those exempted from levy u/s 96 (except those exempted from levy u/s 96 (except those exempted from levy u/s 96 (except those

made u/s 46) of RFCTLARR Actmade u/s 46) of RFCTLARR Actmade u/s 46) of RFCTLARR Actmade u/s 46) of RFCTLARR Act

�Form.No.15G/15H for nonForm.No.15G/15H for nonForm.No.15G/15H for nonForm.No.15G/15H for non----deduction of tax deduction of tax deduction of tax deduction of tax

at source in respect insurance commission at source in respect insurance commission at source in respect insurance commission at source in respect insurance commission

referred in section 194Dreferred in section 194Dreferred in section 194Dreferred in section 194D

Lunawat & Co.

TCSTCSTCSTCS

� Jewellery sale above Jewellery sale above Jewellery sale above Jewellery sale above RsRsRsRs. 5 Lakhs excluded . 5 Lakhs excluded . 5 Lakhs excluded . 5 Lakhs excluded

from TCS levyfrom TCS levyfrom TCS levyfrom TCS levy

�206CC introduced if without PAN for TCS:206CC introduced if without PAN for TCS:206CC introduced if without PAN for TCS:206CC introduced if without PAN for TCS:

� Tax @ twice or 5% whichever is highTax @ twice or 5% whichever is highTax @ twice or 5% whichever is highTax @ twice or 5% whichever is high

� Exemption to nonExemption to nonExemption to nonExemption to non----residentsresidentsresidentsresidents

�CG, SG, CG, SG, CG, SG, CG, SG, embassy, embassy, embassy, embassy, High High High High Commission, Commission, Commission, Commission,

legation, commission, consulate legation, commission, consulate legation, commission, consulate legation, commission, consulate & trade & trade & trade & trade

representation representation representation representation of of of of foreign State; local foreign State; local foreign State; local foreign State; local

authority exempted from TCS on Motor authority exempted from TCS on Motor authority exempted from TCS on Motor authority exempted from TCS on Motor

VehicleVehicleVehicleVehicle

Lunawat & Co.

HOUSE PROPERTYHOUSE PROPERTYHOUSE PROPERTYHOUSE PROPERTY

�No Notional rent in case of property being No Notional rent in case of property being No Notional rent in case of property being No Notional rent in case of property being

held as stock in trade held as stock in trade held as stock in trade held as stock in trade uptouptouptoupto 1 year from end 1 year from end 1 year from end 1 year from end

of FY in which of FY in which of FY in which of FY in which the certificate of completion the certificate of completion the certificate of completion the certificate of completion

of construction of the property is obtained of construction of the property is obtained of construction of the property is obtained of construction of the property is obtained

from the competent from the competent from the competent from the competent authorityauthorityauthorityauthority

�Loss from HP restricted to be adjusted Loss from HP restricted to be adjusted Loss from HP restricted to be adjusted Loss from HP restricted to be adjusted

against other heads of income exceeding against other heads of income exceeding against other heads of income exceeding against other heads of income exceeding

RsRsRsRs. 2 Lakhs. 2 Lakhs. 2 Lakhs. 2 Lakhs

Lunawat & Co.

IMMOVABLE PROPERTYIMMOVABLE PROPERTYIMMOVABLE PROPERTYIMMOVABLE PROPERTY�Land / Building / Both Long Term if Land / Building / Both Long Term if Land / Building / Both Long Term if Land / Building / Both Long Term if

held for more than 24 monthsheld for more than 24 monthsheld for more than 24 monthsheld for more than 24 months

�S. 54 / 54F??S. 54 / 54F??S. 54 / 54F??S. 54 / 54F??

�S. 80S. 80S. 80S. 80----IBA IBA IBA IBA –––– affordable housingaffordable housingaffordable housingaffordable housing

�30 sq. 30 sq. 30 sq. 30 sq. mtrmtrmtrmtr / 60 / 60 / 60 / 60 sqsqsqsq mtrmtrmtrmtr to be carpet area and to be carpet area and to be carpet area and to be carpet area and

not not not not bulitbulitbulitbulit up areaup areaup areaup area

�30 sq. 30 sq. 30 sq. 30 sq. mtrmtrmtrmtr only in metro. 25km condition only in metro. 25km condition only in metro. 25km condition only in metro. 25km condition

waivedwaivedwaivedwaived

�Period of completion increased from 3 years to Period of completion increased from 3 years to Period of completion increased from 3 years to Period of completion increased from 3 years to

5 years5 years5 years5 years

Lunawat & Co.

IMMOVABLE PROPERTY IMMOVABLE PROPERTY IMMOVABLE PROPERTY IMMOVABLE PROPERTY ---- JDAJDAJDAJDA�S. 45(5A) S. 45(5A) S. 45(5A) S. 45(5A) –––– Joint Development AgreementJoint Development AgreementJoint Development AgreementJoint Development Agreement

�Has to be a registered agreement Has to be a registered agreement Has to be a registered agreement Has to be a registered agreement

� Individual / HUF Individual / HUF Individual / HUF Individual / HUF ---- CG CG CG CG in PY in PY in PY in PY in which certificate in which certificate in which certificate in which certificate of of of of

completion completion completion completion for for for for whole whole whole whole / / / / part of part of part of part of project is issued by project is issued by project is issued by project is issued by

competent authoritycompetent authoritycompetent authoritycompetent authority

� Value of full consideration Value of full consideration Value of full consideration Value of full consideration ---- Stamp Stamp Stamp Stamp duty value of his duty value of his duty value of his duty value of his

share in property in share in property in share in property in share in property in project on project on project on project on date date date date of of of of issue issue issue issue of said of said of said of said

certificate certificate certificate certificate as as as as increased by any monetary increased by any monetary increased by any monetary increased by any monetary

consideration consideration consideration consideration received.received.received.received.

� If transfer his share before completion, normal If transfer his share before completion, normal If transfer his share before completion, normal If transfer his share before completion, normal

provisionsprovisionsprovisionsprovisions

� 10% TDS on consideration paid10% TDS on consideration paid10% TDS on consideration paid10% TDS on consideration paid

Lunawat & Co.

CAPITAL GAINSCAPITAL GAINSCAPITAL GAINSCAPITAL GAINS� Base year for indexation shifted to 1.4.2001Base year for indexation shifted to 1.4.2001Base year for indexation shifted to 1.4.2001Base year for indexation shifted to 1.4.2001

� S. 54EC to include other than REC / NHAI bondsS. 54EC to include other than REC / NHAI bondsS. 54EC to include other than REC / NHAI bondsS. 54EC to include other than REC / NHAI bonds

� Rupee denominated bond of Indian company Rupee denominated bond of Indian company Rupee denominated bond of Indian company Rupee denominated bond of Indian company

issued outside India, by a nonissued outside India, by a nonissued outside India, by a nonissued outside India, by a non----resident to resident to resident to resident to

another nonanother nonanother nonanother non----resident shall not be regarded as resident shall not be regarded as resident shall not be regarded as resident shall not be regarded as

transfertransfertransfertransfer

� Conversion of preference share of a company Conversion of preference share of a company Conversion of preference share of a company Conversion of preference share of a company

into its equity share shall not be regarded as into its equity share shall not be regarded as into its equity share shall not be regarded as into its equity share shall not be regarded as

transfer. transfer. transfer. transfer. Consequently Consequently Consequently Consequently the cost of acquisition the cost of acquisition the cost of acquisition the cost of acquisition

and period of holding shall be the date of and period of holding shall be the date of and period of holding shall be the date of and period of holding shall be the date of

acquisition of preference shares acquisition of preference shares acquisition of preference shares acquisition of preference shares

Lunawat & Co.

CAPITAL GAINSCAPITAL GAINSCAPITAL GAINSCAPITAL GAINS� No transfer in case of consolidation of Mutual No transfer in case of consolidation of Mutual No transfer in case of consolidation of Mutual No transfer in case of consolidation of Mutual

funds funds funds funds ---- Consequently the cost of acquisition and Consequently the cost of acquisition and Consequently the cost of acquisition and Consequently the cost of acquisition and

period of holding shall be the date of acquisition period of holding shall be the date of acquisition period of holding shall be the date of acquisition period of holding shall be the date of acquisition

of of of of specific unitsspecific unitsspecific unitsspecific units

� Cost Cost Cost Cost in certain cases:in certain cases:in certain cases:in certain cases:

�where the where the where the where the CG arises CG arises CG arises CG arises from the transfer of from the transfer of from the transfer of from the transfer of asset asset asset asset

held by a trust or an institution in respect of held by a trust or an institution in respect of held by a trust or an institution in respect of held by a trust or an institution in respect of

which accreted income has been computed which accreted income has been computed which accreted income has been computed which accreted income has been computed

u/s u/s u/s u/s 115TD cost 115TD cost 115TD cost 115TD cost of acquisition of acquisition of acquisition of acquisition ---- fair market fair market fair market fair market

value of the assetvalue of the assetvalue of the assetvalue of the asset

Lunawat & Co.

CAPITAL GAINSCAPITAL GAINSCAPITAL GAINSCAPITAL GAINS� Cost in certain cases:Cost in certain cases:Cost in certain cases:Cost in certain cases:

�Cost in case of Cost in case of Cost in case of Cost in case of specified capital asset specified capital asset specified capital asset specified capital asset u/s u/s u/s u/s

10(37A10(37A10(37A10(37A), ), ), ), shall shall shall shall be be be be its its its its stamp duty value on the stamp duty value on the stamp duty value on the stamp duty value on the

last day of the last day of the last day of the last day of the 2222ndndndnd FY FY FY FY after the end of after the end of after the end of after the end of FY FY FY FY in in in in

which the possession of such asset was which the possession of such asset was which the possession of such asset was which the possession of such asset was

handed over to the handed over to the handed over to the handed over to the assesseeassesseeassesseeassessee

� In case of demerger cost of acquisition of In case of demerger cost of acquisition of In case of demerger cost of acquisition of In case of demerger cost of acquisition of

shares of Indian company in shares of Indian company in shares of Indian company in shares of Indian company in hands hands hands hands of of of of resulting resulting resulting resulting

foreign company shall foreign company shall foreign company shall foreign company shall be be be be same as it was same as it was same as it was same as it was in in in in

hands hands hands hands of demerged foreign companyof demerged foreign companyof demerged foreign companyof demerged foreign company

Lunawat & Co.

COCOCOCO----OPERATIVE BANKSOPERATIVE BANKSOPERATIVE BANKSOPERATIVE BANKS• S. 43D benefit extended to coS. 43D benefit extended to coS. 43D benefit extended to coS. 43D benefit extended to co----operative banks operative banks operative banks operative banks

other than a primary agricultural credit society other than a primary agricultural credit society other than a primary agricultural credit society other than a primary agricultural credit society

or a primary coor a primary coor a primary coor a primary co----operative agricultural & rural operative agricultural & rural operative agricultural & rural operative agricultural & rural

development bank development bank development bank development bank ---- interest of bad or doubtful interest of bad or doubtful interest of bad or doubtful interest of bad or doubtful

debts taxed in year in which it is credited to its debts taxed in year in which it is credited to its debts taxed in year in which it is credited to its debts taxed in year in which it is credited to its

PL year or actually received. PL year or actually received. PL year or actually received. PL year or actually received.

• Interest payable to coInterest payable to coInterest payable to coInterest payable to co----operative bank other than operative bank other than operative bank other than operative bank other than

a primary agricultural credit society a primary agricultural credit society a primary agricultural credit society a primary agricultural credit society / / / / primary primary primary primary

cocococo----operative agricultural operative agricultural operative agricultural operative agricultural & & & & rural development rural development rural development rural development

bank covered u/s 43B.bank covered u/s 43B.bank covered u/s 43B.bank covered u/s 43B.

• Provision for bad & doubtful debts u/s 36 for Provision for bad & doubtful debts u/s 36 for Provision for bad & doubtful debts u/s 36 for Provision for bad & doubtful debts u/s 36 for

banks banks banks banks etcetcetcetc increased from 7 ½%. to 8 ½%increased from 7 ½%. to 8 ½%increased from 7 ½%. to 8 ½%increased from 7 ½%. to 8 ½%

Lunawat & Co.

START UPSSTART UPSSTART UPSSTART UPS• Deduction u/s 80Deduction u/s 80Deduction u/s 80Deduction u/s 80----IAC introduced in IAC introduced in IAC introduced in IAC introduced in

Finance Act 2016Finance Act 2016Finance Act 2016Finance Act 2016

• Block of exemption from 3 out of 5 years Block of exemption from 3 out of 5 years Block of exemption from 3 out of 5 years Block of exemption from 3 out of 5 years

amended to 3 out of 7 yearsamended to 3 out of 7 yearsamended to 3 out of 7 yearsamended to 3 out of 7 years

• Losses carried forward Losses carried forward Losses carried forward Losses carried forward –––– 51% restriction 51% restriction 51% restriction 51% restriction

u/s 79u/s 79u/s 79u/s 79

• 51% restriction would not apply but 51% restriction would not apply but 51% restriction would not apply but 51% restriction would not apply but

shareholders to remain same in year of shareholders to remain same in year of shareholders to remain same in year of shareholders to remain same in year of

profitprofitprofitprofit

Lunawat & Co.

BOOKS OF ACCOUNTS / AUDITBOOKS OF ACCOUNTS / AUDITBOOKS OF ACCOUNTS / AUDITBOOKS OF ACCOUNTS / AUDIT

• Turnover limit increased from Turnover limit increased from Turnover limit increased from Turnover limit increased from RsRsRsRs. 10 . 10 . 10 . 10

Lakh to Lakh to Lakh to Lakh to RsRsRsRs. 25 Lakhs. 25 Lakhs. 25 Lakhs. 25 Lakhs

• Income from PGBP increased from Income from PGBP increased from Income from PGBP increased from Income from PGBP increased from RsRsRsRs. . . .

1.20 Lakhs to 1.20 Lakhs to 1.20 Lakhs to 1.20 Lakhs to RsRsRsRs. 2.50 Lakhs. 2.50 Lakhs. 2.50 Lakhs. 2.50 Lakhs

• Increases only in case of individual & Increases only in case of individual & Increases only in case of individual & Increases only in case of individual &

HUFHUFHUFHUF

• No. 44AB audit under clause (No. 44AB audit under clause (No. 44AB audit under clause (No. 44AB audit under clause (iiii) if ) if ) if ) if

covered u/s 44ADcovered u/s 44ADcovered u/s 44ADcovered u/s 44AD

Lunawat & Co.

POLITICAL PARTIESPOLITICAL PARTIESPOLITICAL PARTIESPOLITICAL PARTIES

• No donations in cash exceeding No donations in cash exceeding No donations in cash exceeding No donations in cash exceeding RsRsRsRs. . . .

2000/2000/2000/2000/----

• Return to be filed within time to avail IT Return to be filed within time to avail IT Return to be filed within time to avail IT Return to be filed within time to avail IT

exemptionexemptionexemptionexemption

• Electoral Bonds can be accepted by themElectoral Bonds can be accepted by themElectoral Bonds can be accepted by themElectoral Bonds can be accepted by them

Lunawat & Co.

CHARITABLECHARITABLECHARITABLECHARITABLE• Return on time for exemption u/s 11 / 12Return on time for exemption u/s 11 / 12Return on time for exemption u/s 11 / 12Return on time for exemption u/s 11 / 12

• In case of modifications of objects which do In case of modifications of objects which do In case of modifications of objects which do In case of modifications of objects which do

not conform to the conditions of registration; not conform to the conditions of registration; not conform to the conditions of registration; not conform to the conditions of registration;

fresh registration within 30 days fresh registration within 30 days fresh registration within 30 days fresh registration within 30 days

• Corpus donation made by a trust or institution Corpus donation made by a trust or institution Corpus donation made by a trust or institution Corpus donation made by a trust or institution

to another trust or institution u/s 11 or u/s to another trust or institution u/s 11 or u/s to another trust or institution u/s 11 or u/s to another trust or institution u/s 11 or u/s

10(23C) shall not be treated as application of 10(23C) shall not be treated as application of 10(23C) shall not be treated as application of 10(23C) shall not be treated as application of

income. income. income. income.

• Corpus donation made by a trust or institution Corpus donation made by a trust or institution Corpus donation made by a trust or institution Corpus donation made by a trust or institution

u/s 10(23C) to another trust or institution u/s u/s 10(23C) to another trust or institution u/s u/s 10(23C) to another trust or institution u/s u/s 10(23C) to another trust or institution u/s

11 or 10(23C) shall not be treated as 11 or 10(23C) shall not be treated as 11 or 10(23C) shall not be treated as 11 or 10(23C) shall not be treated as

application of incomeapplication of incomeapplication of incomeapplication of income

Lunawat & Co.

MAT & MAT & MAT & MAT & AMTAMTAMTAMT

• Credit period increased from 10 years to 15 Credit period increased from 10 years to 15 Credit period increased from 10 years to 15 Credit period increased from 10 years to 15

yearyearyearyear

• Specific MAT provisions where a company Specific MAT provisions where a company Specific MAT provisions where a company Specific MAT provisions where a company

complies with complies with complies with complies with IndIndIndInd ASASASAS

• Credit relating to difference between Credit relating to difference between Credit relating to difference between Credit relating to difference between

amount of foreign tax credit (FTC) allowed amount of foreign tax credit (FTC) allowed amount of foreign tax credit (FTC) allowed amount of foreign tax credit (FTC) allowed

against MAT/ AMT and FTC allowable against MAT/ AMT and FTC allowable against MAT/ AMT and FTC allowable against MAT/ AMT and FTC allowable

against the tax computed under regular against the tax computed under regular against the tax computed under regular against the tax computed under regular

provisions of Act other than the provisions provisions of Act other than the provisions provisions of Act other than the provisions provisions of Act other than the provisions

relating to MAT/AMT not allowed to be relating to MAT/AMT not allowed to be relating to MAT/AMT not allowed to be relating to MAT/AMT not allowed to be

carried forwardcarried forwardcarried forwardcarried forward

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DIVIDENDDIVIDENDDIVIDENDDIVIDEND

• S. 115BBDA so as to provide that income S. 115BBDA so as to provide that income S. 115BBDA so as to provide that income S. 115BBDA so as to provide that income

by way of dividend in excess of Rs.10 lakh by way of dividend in excess of Rs.10 lakh by way of dividend in excess of Rs.10 lakh by way of dividend in excess of Rs.10 lakh

is chargeable to tax at the rate of 10% on is chargeable to tax at the rate of 10% on is chargeable to tax at the rate of 10% on is chargeable to tax at the rate of 10% on

gross basis in case of all gross basis in case of all gross basis in case of all gross basis in case of all assesseesassesseesassesseesassessees except:except:except:except:

• Domestic companyDomestic companyDomestic companyDomestic company

• Trusts, institutions u/s 10(23)(C) (iv) / (v) Trusts, institutions u/s 10(23)(C) (iv) / (v) Trusts, institutions u/s 10(23)(C) (iv) / (v) Trusts, institutions u/s 10(23)(C) (iv) / (v)

/ (vi) / (via)/ (vi) / (via)/ (vi) / (via)/ (vi) / (via)

• Trust Trust Trust Trust etcetcetcetc u/s 12AAu/s 12AAu/s 12AAu/s 12AA

• Deemed dividend u/s 2(22)(e) excludedDeemed dividend u/s 2(22)(e) excludedDeemed dividend u/s 2(22)(e) excludedDeemed dividend u/s 2(22)(e) excluded

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SECTION 56SECTION 56SECTION 56SECTION 56

• New clause (x) inserted in S. 56(2) to New clause (x) inserted in S. 56(2) to New clause (x) inserted in S. 56(2) to New clause (x) inserted in S. 56(2) to

replace clauses (vii) & (replace clauses (vii) & (replace clauses (vii) & (replace clauses (vii) & (viiaviiaviiaviia) ) ) ) –––– now all now all now all now all

assesseesassesseesassesseesassessees coveredcoveredcoveredcovered

• More clauses of S. 47 added to More clauses of S. 47 added to More clauses of S. 47 added to More clauses of S. 47 added to

exemptionexemptionexemptionexemption

Lunawat & Co.

EXEMPTIONSEXEMPTIONSEXEMPTIONSEXEMPTIONS

• Exemption on partial withdrawal from Exemption on partial withdrawal from Exemption on partial withdrawal from Exemption on partial withdrawal from

National Pension System not exceeding National Pension System not exceeding National Pension System not exceeding National Pension System not exceeding

25% of the contribution made by the 25% of the contribution made by the 25% of the contribution made by the 25% of the contribution made by the

employee employee employee employee –––– earlier 40% on closureearlier 40% on closureearlier 40% on closureearlier 40% on closure

• Income accruing or arising to a foreign Income accruing or arising to a foreign Income accruing or arising to a foreign Income accruing or arising to a foreign

co. on a/c of sale of leftover stock of co. on a/c of sale of leftover stock of co. on a/c of sale of leftover stock of co. on a/c of sale of leftover stock of

crude oil, from a facility in India after crude oil, from a facility in India after crude oil, from a facility in India after crude oil, from a facility in India after

expiry of an agreement / arrangement expiry of an agreement / arrangement expiry of an agreement / arrangement expiry of an agreement / arrangement

u/s 10(48A) exempt subject to notified u/s 10(48A) exempt subject to notified u/s 10(48A) exempt subject to notified u/s 10(48A) exempt subject to notified

conditions conditions conditions conditions

Lunawat & Co.

EXEMPTIONSEXEMPTIONSEXEMPTIONSEXEMPTIONS

• Section 10AA deduction allowed from the Section 10AA deduction allowed from the Section 10AA deduction allowed from the Section 10AA deduction allowed from the

total income before giving effect to total income before giving effect to total income before giving effect to total income before giving effect to

section 10AA and the deduction in no section 10AA and the deduction in no section 10AA and the deduction in no section 10AA and the deduction in no

case shall exceed the said total incomecase shall exceed the said total incomecase shall exceed the said total incomecase shall exceed the said total income

• S. 80CCD(1) in respect of contribution S. 80CCD(1) in respect of contribution S. 80CCD(1) in respect of contribution S. 80CCD(1) in respect of contribution

towards NPS cannot exceed 10% of towards NPS cannot exceed 10% of towards NPS cannot exceed 10% of towards NPS cannot exceed 10% of

salary in case of an employee or 10% of salary in case of an employee or 10% of salary in case of an employee or 10% of salary in case of an employee or 10% of

gross total income in case of other gross total income in case of other gross total income in case of other gross total income in case of other

individuals. Limit of 10% of GTI increased individuals. Limit of 10% of GTI increased individuals. Limit of 10% of GTI increased individuals. Limit of 10% of GTI increased

to 20% in case of other than employeeto 20% in case of other than employeeto 20% in case of other than employeeto 20% in case of other than employee

Lunawat & Co.

DEDUCTIONSDEDUCTIONSDEDUCTIONSDEDUCTIONS• S. 10(37A) inserted S. 10(37A) inserted S. 10(37A) inserted S. 10(37A) inserted ---- individual or HUF who individual or HUF who individual or HUF who individual or HUF who

was owner of land on 2.6.2014, and has was owner of land on 2.6.2014, and has was owner of land on 2.6.2014, and has was owner of land on 2.6.2014, and has

transferred the same under land pooling transferred the same under land pooling transferred the same under land pooling transferred the same under land pooling

scheme scheme scheme scheme ---- AP Capital City Land Pooling Scheme AP Capital City Land Pooling Scheme AP Capital City Land Pooling Scheme AP Capital City Land Pooling Scheme

(Formulation & Implementation) Rules, 2015:(Formulation & Implementation) Rules, 2015:(Formulation & Implementation) Rules, 2015:(Formulation & Implementation) Rules, 2015:• Transfer of capital asset being land or building or Transfer of capital asset being land or building or Transfer of capital asset being land or building or Transfer of capital asset being land or building or

both, under land pooling scheme.both, under land pooling scheme.both, under land pooling scheme.both, under land pooling scheme.

• Sale of LPOCs by the said persons received in lieu Sale of LPOCs by the said persons received in lieu Sale of LPOCs by the said persons received in lieu Sale of LPOCs by the said persons received in lieu

of land transferred.of land transferred.of land transferred.of land transferred.

• Sale of reconstituted plot or land within 2 years Sale of reconstituted plot or land within 2 years Sale of reconstituted plot or land within 2 years Sale of reconstituted plot or land within 2 years

from the end of the FY in which the possession of from the end of the FY in which the possession of from the end of the FY in which the possession of from the end of the FY in which the possession of

such plot or land was handed over to the said such plot or land was handed over to the said such plot or land was handed over to the said such plot or land was handed over to the said

personspersonspersonspersons

Lunawat & Co.

EQUITY SHARESEQUITY SHARESEQUITY SHARESEQUITY SHARES• 10(38) 10(38) 10(38) 10(38) –––– Equity LTCG Equity LTCG Equity LTCG Equity LTCG ---- transfer of equity share transfer of equity share transfer of equity share transfer of equity share

acquired or on after 1.10.2004 available only if acquired or on after 1.10.2004 available only if acquired or on after 1.10.2004 available only if acquired or on after 1.10.2004 available only if

acquisition of share is chargeable to STT. Earlier acquisition of share is chargeable to STT. Earlier acquisition of share is chargeable to STT. Earlier acquisition of share is chargeable to STT. Earlier

STT was required only in case of sale of shares.STT was required only in case of sale of shares.STT was required only in case of sale of shares.STT was required only in case of sale of shares.

To notify exemptions (could be IPO, FPO, Right To notify exemptions (could be IPO, FPO, Right To notify exemptions (could be IPO, FPO, Right To notify exemptions (could be IPO, FPO, Right

Issue, Bonus, Issue, Bonus, Issue, Bonus, Issue, Bonus, etcetcetcetc). ). ). ).

• S. 50CA for other than quoted shares sold S. 50CA for other than quoted shares sold S. 50CA for other than quoted shares sold S. 50CA for other than quoted shares sold

below FMVbelow FMVbelow FMVbelow FMV• “quoted share” means share quoted on any “quoted share” means share quoted on any “quoted share” means share quoted on any “quoted share” means share quoted on any

recognised SE with regularity from time to time, recognised SE with regularity from time to time, recognised SE with regularity from time to time, recognised SE with regularity from time to time,

where quotation of such share is based on current where quotation of such share is based on current where quotation of such share is based on current where quotation of such share is based on current

transaction made in ordinary course of businesstransaction made in ordinary course of businesstransaction made in ordinary course of businesstransaction made in ordinary course of business

Lunawat & Co.

SEARCHSEARCHSEARCHSEARCH• Notice can be issued for AY(s) beyond 6Notice can be issued for AY(s) beyond 6Notice can be issued for AY(s) beyond 6Notice can be issued for AY(s) beyond 6thththth

AY already provided AY already provided AY already provided AY already provided uptouptouptoupto 10th AY if10th AY if10th AY if10th AY if————

• AO has in his possession books of a/AO has in his possession books of a/AO has in his possession books of a/AO has in his possession books of a/cscscscs / / / /

other documents /evidence which reveal other documents /evidence which reveal other documents /evidence which reveal other documents /evidence which reveal

income escaping assessment amounts income escaping assessment amounts income escaping assessment amounts income escaping assessment amounts

to / likely to be to / likely to be to / likely to be to / likely to be RsRsRsRs. 50 Lacs or more in 1 . 50 Lacs or more in 1 . 50 Lacs or more in 1 . 50 Lacs or more in 1

yryryryr or in or in or in or in aggaggaggagg. in 4 AYs (beyond 6. in 4 AYs (beyond 6. in 4 AYs (beyond 6. in 4 AYs (beyond 6thththth yryryryr););););

• is in form of asset;is in form of asset;is in form of asset;is in form of asset;

• income escaping assessment or part income escaping assessment or part income escaping assessment or part income escaping assessment or part

thereof relates to such year(s)thereof relates to such year(s)thereof relates to such year(s)thereof relates to such year(s)

Lunawat & Co.

SEARCHSEARCHSEARCHSEARCH• S. 197(c) of the Finance Act omittedS. 197(c) of the Finance Act omittedS. 197(c) of the Finance Act omittedS. 197(c) of the Finance Act omitted

• ‘Reason to believe' or 'reason to suspect', ‘Reason to believe' or 'reason to suspect', ‘Reason to believe' or 'reason to suspect', ‘Reason to believe' or 'reason to suspect',

as the case may be, not be disclosed to as the case may be, not be disclosed to as the case may be, not be disclosed to as the case may be, not be disclosed to

any person or any authority or ITATany person or any authority or ITATany person or any authority or ITATany person or any authority or ITAT

• Provisional attachment with the prior Provisional attachment with the prior Provisional attachment with the prior Provisional attachment with the prior

approval of property belonging to approval of property belonging to approval of property belonging to approval of property belonging to

assesseeassesseeassesseeassessee during search / within 60 days during search / within 60 days during search / within 60 days during search / within 60 days

from which last from which last from which last from which last authorisationsauthorisationsauthorisationsauthorisations for searchfor searchfor searchfor search

• Reference to a Valuation Officer Reference to a Valuation Officer Reference to a Valuation Officer Reference to a Valuation Officer ---- furnish furnish furnish furnish

valuation report within 60 daysvaluation report within 60 daysvaluation report within 60 daysvaluation report within 60 days

Lunawat & Co.

INQUIRY / SURVEYINQUIRY / SURVEYINQUIRY / SURVEYINQUIRY / SURVEY• Sec 133 Sec 133 Sec 133 Sec 133 ---- power of inquiry or proceeding power of inquiry or proceeding power of inquiry or proceeding power of inquiry or proceeding

by the Jt. Director, the by the Jt. Director, the by the Jt. Director, the by the Jt. Director, the DptyDptyDptyDpty Director and Director and Director and Director and

the Assistant Director also without seeking the Assistant Director also without seeking the Assistant Director also without seeking the Assistant Director also without seeking

prior approval of higher authoritiesprior approval of higher authoritiesprior approval of higher authoritiesprior approval of higher authorities

• Power to survey Power to survey Power to survey Power to survey ---- place, at which place, at which place, at which place, at which

charitable activity is carried on included. charitable activity is carried on included. charitable activity is carried on included. charitable activity is carried on included.

• CentralisedCentralisedCentralisedCentralised issuance of notice calling for issuance of notice calling for issuance of notice calling for issuance of notice calling for

information and documents and making information and documents and making information and documents and making information and documents and making

outcome thereof available to Assessing outcome thereof available to Assessing outcome thereof available to Assessing outcome thereof available to Assessing

Officer for necessary action, if any. Officer for necessary action, if any. Officer for necessary action, if any. Officer for necessary action, if any.

Lunawat & Co.

PENALTYPENALTYPENALTYPENALTY• S. 271DA inserted contravention of s. S. 271DA inserted contravention of s. S. 271DA inserted contravention of s. S. 271DA inserted contravention of s.

269ST (269ST (269ST (269ST (RsRsRsRs. 3 Lakhs… other than cash).. . 3 Lakhs… other than cash).. . 3 Lakhs… other than cash).. . 3 Lakhs… other than cash)..

• S. 271J inserted S. 271J inserted S. 271J inserted S. 271J inserted ---- Accountant (CA) or a Accountant (CA) or a Accountant (CA) or a Accountant (CA) or a

merchant banker or a registered merchant banker or a registered merchant banker or a registered merchant banker or a registered valuervaluervaluervaluer, , , ,

furnishes incorrect information in a report furnishes incorrect information in a report furnishes incorrect information in a report furnishes incorrect information in a report

or certificate or certificate or certificate or certificate ---- AO or CIT (A) AO or CIT (A) AO or CIT (A) AO or CIT (A) –––– penalty penalty penalty penalty RsRsRsRs. . . .

10000/10000/10000/10000/---- for each such report or for each such report or for each such report or for each such report or

certificate.certificate.certificate.certificate.

• S. 271F for failure to furnish return of S. 271F for failure to furnish return of S. 271F for failure to furnish return of S. 271F for failure to furnish return of

income to be omittedincome to be omittedincome to be omittedincome to be omitted

Lunawat & Co.

TP / INTERNATIONAL TAXTP / INTERNATIONAL TAXTP / INTERNATIONAL TAXTP / INTERNATIONAL TAX

• S. 94B inserted S. 94B inserted S. 94B inserted S. 94B inserted ---- interest expenses < interest expenses < interest expenses < interest expenses < RsRsRsRs. 1 . 1 . 1 . 1

Cr. to its AE restricted to 30% of EBITDA or Cr. to its AE restricted to 30% of EBITDA or Cr. to its AE restricted to 30% of EBITDA or Cr. to its AE restricted to 30% of EBITDA or

interest paid or payable to associated interest paid or payable to associated interest paid or payable to associated interest paid or payable to associated

enterprise, whichever is less. Banks and enterprise, whichever is less. Banks and enterprise, whichever is less. Banks and enterprise, whichever is less. Banks and

Insurance business excluded. Insurance business excluded. Insurance business excluded. Insurance business excluded.

• DTP DTP DTP DTP –––– S. 40A(2)(b) transactions excluded.S. 40A(2)(b) transactions excluded.S. 40A(2)(b) transactions excluded.S. 40A(2)(b) transactions excluded.

• Any 'term' in DTAA, meaning as per DTAA Any 'term' in DTAA, meaning as per DTAA Any 'term' in DTAA, meaning as per DTAA Any 'term' in DTAA, meaning as per DTAA

and where not defined in DTAA, but is and where not defined in DTAA, but is and where not defined in DTAA, but is and where not defined in DTAA, but is

defined in the Act, meaning as definition in defined in the Act, meaning as definition in defined in the Act, meaning as definition in defined in the Act, meaning as definition in

the Act or any explanation issued by the CG. the Act or any explanation issued by the CG. the Act or any explanation issued by the CG. the Act or any explanation issued by the CG.

Lunawat & Co.

TP / INTERNATIONAL TAXTP / INTERNATIONAL TAXTP / INTERNATIONAL TAXTP / INTERNATIONAL TAX• Where as a result of primary adjustment to Where as a result of primary adjustment to Where as a result of primary adjustment to Where as a result of primary adjustment to

TP, there is increase in TI or reduction in TP, there is increase in TI or reduction in TP, there is increase in TI or reduction in TP, there is increase in TI or reduction in

loss, the excess money available with its loss, the excess money available with its loss, the excess money available with its loss, the excess money available with its

AE, if not repatriated to India within time AE, if not repatriated to India within time AE, if not repatriated to India within time AE, if not repatriated to India within time

prescribed, shall be deemed to be an prescribed, shall be deemed to be an prescribed, shall be deemed to be an prescribed, shall be deemed to be an

advance to such AE & interest on advance, advance to such AE & interest on advance, advance to such AE & interest on advance, advance to such AE & interest on advance,

shall be computed as income of shall be computed as income of shall be computed as income of shall be computed as income of assesseeassesseeassesseeassessee....

• Secondary adjustment only if primary Secondary adjustment only if primary Secondary adjustment only if primary Secondary adjustment only if primary

adjustment in any PY does not exceed adjustment in any PY does not exceed adjustment in any PY does not exceed adjustment in any PY does not exceed RsRsRsRs. 1 . 1 . 1 . 1

Crore & is made in on or before AY 2016Crore & is made in on or before AY 2016Crore & is made in on or before AY 2016Crore & is made in on or before AY 2016----17171717

Lunawat & Co.

TP / INTERNATIONAL TAXTP / INTERNATIONAL TAXTP / INTERNATIONAL TAXTP / INTERNATIONAL TAX• Secondary adjustment where the primary Secondary adjustment where the primary Secondary adjustment where the primary Secondary adjustment where the primary

adjustment to TP has been made:adjustment to TP has been made:adjustment to TP has been made:adjustment to TP has been made:• suomotosuomotosuomotosuomoto by by by by assesseeassesseeassesseeassessee in his ROI; or in his ROI; or in his ROI; or in his ROI; or

• made by AO and accepted by made by AO and accepted by made by AO and accepted by made by AO and accepted by assesseeassesseeassesseeassessee; or ; or ; or ; or

• is determined by APA entered into by is determined by APA entered into by is determined by APA entered into by is determined by APA entered into by

assesseeassesseeassesseeassessee; or ; or ; or ; or

• is made as per the safe is made as per the safe is made as per the safe is made as per the safe harbourharbourharbourharbour rules rules rules rules

framed; or framed; or framed; or framed; or

• is arising as a result of resolution of an is arising as a result of resolution of an is arising as a result of resolution of an is arising as a result of resolution of an

assessment by way of the mutual agreement assessment by way of the mutual agreement assessment by way of the mutual agreement assessment by way of the mutual agreement

procedure under an agreement entered into.procedure under an agreement entered into.procedure under an agreement entered into.procedure under an agreement entered into.

Lunawat & Co.

TP / INTERNATIONAL TAXTP / INTERNATIONAL TAXTP / INTERNATIONAL TAXTP / INTERNATIONAL TAX• Indirect Transfer provisions not applicable Indirect Transfer provisions not applicable Indirect Transfer provisions not applicable Indirect Transfer provisions not applicable

to investment held by nonto investment held by nonto investment held by nonto investment held by non----resident in a FII resident in a FII resident in a FII resident in a FII

and registered as Categoryand registered as Categoryand registered as Categoryand registered as Category----I or Category II I or Category II I or Category II I or Category II

Foreign Portfolio Investor under SEBI (Foreign Portfolio Investor under SEBI (Foreign Portfolio Investor under SEBI (Foreign Portfolio Investor under SEBI (W.e.fW.e.fW.e.fW.e.f

AY 2012AY 2012AY 2012AY 2012----13)13)13)13)

• In PY in which offshore fund u/s 9A is In PY in which offshore fund u/s 9A is In PY in which offshore fund u/s 9A is In PY in which offshore fund u/s 9A is

being wound up, the condition that the being wound up, the condition that the being wound up, the condition that the being wound up, the condition that the

monthly average of the corpus of the fund monthly average of the corpus of the fund monthly average of the corpus of the fund monthly average of the corpus of the fund

shall not be less than shall not be less than shall not be less than shall not be less than RsRsRsRs. 100 Crores, shall . 100 Crores, shall . 100 Crores, shall . 100 Crores, shall

not apply. not apply. not apply. not apply.

Lunawat & Co.

MISCELLANEOUSMISCELLANEOUSMISCELLANEOUSMISCELLANEOUS

• New section 115BBG New section 115BBG New section 115BBG New section 115BBG ---- income from income from income from income from

transfer of carbon credit, taxed @ 10% transfer of carbon credit, taxed @ 10% transfer of carbon credit, taxed @ 10% transfer of carbon credit, taxed @ 10%

(plus applicable surcharge and (plus applicable surcharge and (plus applicable surcharge and (plus applicable surcharge and cesscesscesscess). ). ). ).

• Government has decided to merge the Government has decided to merge the Government has decided to merge the Government has decided to merge the

Authority for Advance Ruling (AAR) for Authority for Advance Ruling (AAR) for Authority for Advance Ruling (AAR) for Authority for Advance Ruling (AAR) for

incomeincomeincomeincome----tax, central excise, customs duty tax, central excise, customs duty tax, central excise, customs duty tax, central excise, customs duty

and service tax. Accordingly, necessary and service tax. Accordingly, necessary and service tax. Accordingly, necessary and service tax. Accordingly, necessary

amendments, have been made to Chapter amendments, have been made to Chapter amendments, have been made to Chapter amendments, have been made to Chapter

XIXXIXXIXXIX----B to allow merger of these AARsB to allow merger of these AARsB to allow merger of these AARsB to allow merger of these AARs

CA. Pramod JainCA. Pramod JainCA. Pramod JainCA. Pramod Jainpramodjain@lunawat.compramodjain@lunawat.compramodjain@lunawat.compramodjain@lunawat.com

+91 9811073867+91 9811073867+91 9811073867+91 9811073867

© 2017 CA. Pramod Jain, Lunawat & Co