President’s Message | November 2020
Dear Professional friends,
In the most intrigued and bitterly fought Elections to the Office of US President, the people of America have chosen Mr. Joe Biden as their President. The Indo- US relationship largely depend on the political aspiration of the belief they bring to the table. It is also historically important to note that, an Indian American, Ms. Kamala Harris will be the first Women Vice-President in the history of United States. In the world of diplomacy, “There are no permanent friends, or permanent enemies; but only permanent interests”. India keenly awaits to unfold a lot of clarity in its Commercial, Defence and Diplomatic interest.
The month of November also marks the arrival of the “Festival of Lights – Deepawali”, which sets in long period of leaves and festivities for Indians. The grand festival also symbolises, victory of light over darkness, good over evil and knowledge over ignorance. The sacrosanct essence of Deepawali is that we shell out the negativity and kill the demon inside us. This year’s wish comes with set of caution due to the prevailing condition of COVID-19 and by being complacent, it can be ill fated and any negligence can create more concern.
Representations
Our association along with other professional bodies, vehemently made representation along with a press note for extension of various due dates to the Hon’ble Finance Minister and Hon’ble Prime Minister of India. All the requests which were made met a favourable outcome including the one made to the Government of Karnataka to extend the due date for submission of Audit Report under the Karnataka State Co-operative Societies Act, 1959 and has brought cheer amongst the professionals and businessmen.
News Roundup
Direct Tax
As a result of representations made as mentioned above, the same has been well accepted and due dates for filing tax returns for AY 2020-21 in case of the taxpayers who need to get their accounts audited or furnish reports on Specific Domestic or International transactions, the deadline is now 31-01-2021. For the rest, it has been extended to 31-12-2020, from the earlier deadline of 30-11-2020. Further, the due date of filing tax audit report and report in respect of International / Specified Domestic Transactions has also been extended to 31-12- 2020 from the earlier extended deadline of 31-10-2020. Further, the due date for the taxpayer whose self-assessment tax liability is up to ?1 lakh had been extended to 30-11-2020. The CBDT provided a sunset date of 31-12-2020 for filing declaration under Vivad Se Vishwas Act, 2020. Further, an extension has been provided of time limits for payment under the said Act at 100% of the disputed tax by 31-03-2021, with an additional amount of 10% on or after 01-04-2021, but before a date which is yet to be notified.
Indirect Tax
The festive mood of Dasara and Deepawali is rebooted with the news of GST Annual return extension for FY 2018-19, which is now due by 31-12-2020.
In this spree of extensions, we should also mind the fact that working till the last moment only adds to our pressure. I wish to give my thoughts on how we could win over this:
- a) Complete the GST reconciliation for FY 2019-20 along with Tax Audits / Income Tax filings, without waiting for taking it up separately and keep the formats ready.
- b) Propose clients and persuade your team to do the data compilation and reconciliation as soon as possible to reduce the last minute burden. This would give a better horizon of the GST position of your client.
- c) Involve yourself and your team in various knowledge enriching sessions conducted by KSCAA and others on various topics of GST.
- d) See how you could make the GST audit exercise a value additive one for your client rather than mere compliance of law. Work on ratios of Input, outputs and comparisons with previous year data, see the possibility of tax effective structuring of transaction, possibility of availing eligible credits, otherwise missed. A good amount of credit is generally accumulated on account of Bank Charges, POS machine rentals, Stationery and other Office Expenditures, which could miss out and could be traced from GSTR 2A.
Let us all work towards completing the GST audits well in advance, without expecting another extension.
Corporate Law
The MCA vide general circular dated 20th October, 2020 further relaxed the residency requirement of directors clarifying that non-compliance of minimum residency in India for a period of at least 182 days in a year, by at least one director in every company, under section 149 of the Companies Act, 2013 shall not be treated as non-compliance for the FY 2020-21.
The MCA vide notification dated 16th October, 2020 has eased the norms for companies issuing securities to QIBs on Private Placement basis by providing exception of passing a single blanket Special Resolution which shall be valid for a year.
As a part of Government of India’s Ease of Doing Business (EODB) initiative, the Ministry of Corporate Affairs has integrated SPICe+ Incorporation Forms with Profession Tax [PT] – Karnataka w.e.f 08-10-2020 .
Conclusion:
Our profession which relies on knowledge, beholds the rich heritage from experience of learnings, a treasure which every professional continues to practice to mend his learning. Even the great philosopher, Confucius once said “By three methods we may learn Wisdom: First, by reflection, which is noblest; Second, by imitation, which is easiest; and third by experience, which is the bitterest.” This only assures that the wheel of learning needs to continue even during these times and its undiminishing importance.
On the auspicious occasion of festival of lights, I wish all the readers a very happy Deepawali.
Happy reading!
Yours Sincerely,
CA. Kumar S Jigajinni
President