President’s Message | April 2021

Dear Professional Friends,

Let me wish all the readers a happy Ugadi and let this year be filled with happiness, great health and prosperity! The word ‘Ugadi’ is a combination of two words: ‘yug’ meaning ‘age’ and ‘adi’ meaning ‘a new beginning’. Thus, it celebrated the beginning of a new age. Interestingly for us professional accountants, Ugadi coincides the date of new financial year from when the new books are maintained to draw new profits / losses.

Surge in number of Corona cases in the country is a sign of worry to the health of individuals and business. The impact of second wave has already set in and the ambiguity of severe lockdown prevails amongst the business and professional community. Vaccination drive which is currently above 45 years would be soon to open to all above many, IMA has requested to vaccinate all over age of 18 years for free of cost. We only hope that these would enable to win over the virus soon. The first part of the April is spent tirelessly in Bank Audits by CA’s in practice. This year is different with so many changes coming on its way related to reporting and COVID furthered by recent decision of Honorable Supreme Court on NPA classification.

KSCAA from past few years have been conducting residential leadership program and we would wish to continue the same in the future also albeit the uncertainty of severity of pandemic prevails during this year. KSCAA completed the registration of lease cum sale deed of KIADB Harohalli site, the land needs to be put to use within 3 years from the date of lease cum sale deed and association is looking at alternatives and options to monetize the asset, we call from members to put in their suggestion on this.

News Roundup

Direct Tax

The Finance Bill, 2021 was passed by Lok Sabha on 23rd March 2021 with more than 100 new amendments.  It further receives assent of the President on 28th March 2021 and becomes FINANCE ACT, 2021.

Flurry of CBDT’ notifications and circulars on the following:

  • Notifies all ITR Forms 1 to 7 for the AY 2021-22;
  • Inserts new clauses in Form 3CD (Tax Audit Report) and also notifies that Tax Audit Report can be revised if disallowance u/s 40 or 43B needs recalculation; Deferment of two clauses in 3CD to next year.
  • Extends due dates for Aadhar-PAN linking from March 31 to June 30;
  • Notifies procedures and forms for tax registrations by trusts/ institutions. Also notifies format for reporting of donations received and issuance of donation certificates to the donors;
  • Introduces new rule for making an online application for lower withholding on payments to non-residents;
  • Specifies the class of cases for faceless assessment effective from April 1.

Indirect Tax

Change in Financial Year is accompanied by changes in GST Law as well. E invoice has been made mandatory from 01st April 2021 for registered persons with aggregate turnover greater than 50 crores. Last month GST Collections has been the highest so far, amounting to more than 1.2 lakh crores signifying better compliances. This month entails us to file the GST Returns for the month of March 2021 and I suggest my fellow brethren do a thorough reconciliation for the entire FY 20-21 and make all necessary rectifications in this return itself. Let me also draw your attention to the last Karasamadhana Scheme launched by the Karnataka Government which provides for Karnataka dealers to end the legacy disputes, pay taxes, and claim waiver of entire interest and penalties. I encourage all our professionals to share the same with their clients and take benefit of the same.

Corporate Law

MCA had made it mandatory for all companies to use only such accounting softwares having audit trail w.e.f. 1st April 2021. Subsequently the requirement has been deferred to 1st April 2022. Also, MCA requires auditors’ report for financial years commencing from 1st April 2022 onwards to include a declaration regarding the availability and fitness of such accounting software.

MCA has made amendments in Schedule III with effect from 1st April 2021. Through these amendments many new additional disclosures have been made mandatory.

MCA has notified the establishment of Central Scrutiny Centre (CSC), which shall function under the administrative control of the e-governance Cell of MCA, to scrutinize the STP e-forms, with effect from 23rd March 2021, filed under the Companies Act, 2013 and its Rules and forward its findings to the concerned jurisdictional Registrar of Companies for further necessary action under the said Act and its Rules.

MCA has notified the provision that non-executive director, including an independent director, can be remunerated by the Company in case of inadequate / nil profit, subject to the ceiling prescribed under Schedule V of the Companies Act, 2013 and its Rules.

Mahatma Gandhi once said “Live as if you were to die tomorrow. Learn as if you were to live forever”. “Live as if you were to die tomorrow” pushes people to do things in life they always wanted to do because their life is almost up and “Learn as if you were to live forever” urges people to learn since knowledge is the greatest treasure one can possess. It also emphasizes the immortal nature of learning and knowledge and the learning which possess no time space or age. I hope that we all imbibe this saying in truest sense.

Happy Reading!

Yours’ sincerely,

CA. Kumar S Jigajinni