President’s Message | October 2022

Dear Professional Friends,

The grand festival is here and my warm wishes to each and every one of you on Deepawali. May the warmth and splendour, that are part of this auspicious occasion fill your life with happiness and bring bright cheer, joy and prosperity for the year ahead. Happy Deepavali!

India had recently overtaken the UK to become the 5th largest economy in terms of Gross Domestic Product with the USA, China, Japan & Germany ahead of it. The success of such incidents boosts positivity and the dream of being a developed nation also seems to be true soon. Some interesting facts about the GDP are, India was in 11th position a decade ago, it was before the Pandemic hit that this nation had surpassed France to become 6th position and if we consider Purchase power parity (PPP) India has already bypassed China and Germany to be in 3rd position of World’s largest economy. All of this indicates that the growth story is real, and we are moving towards making this nation a better place to live. IMF has downgraded its projection to 6.8% due to the Recession & inflation which may scar the growth story in short term. We are hopeful that these challenges are short-lived.

KSCAA has submitted three representations on matters of importance, one is on recent outstanding tax collection by the Income Tax department with few effective Suggestions, the second is a representation to improve the effectiveness of the Video Conference proceedings in the faceless regime and the third is responding to the proposed ‘comprehensive changes in GSTR 3B’ which was issued by GST Policy wing. Representations are a prominent tool to build a healthy environment and to assist the government in its journey of successful implementation of its intent and policy. I request members to inform on challenges faced at the ground level, our Association would be glad to take the same to the respective department of the government.

I must thank all the participants for their overwhelming response to the ‘Intensive residential GST course’ of KSCAA to be held at Mysore from 4th to 6th November 2022. The booking was closed a month before the event and we would indicate on the next batch for those who would like to attend.

Let me further explain the thought of Lateral thinking from my previous message. This was coined by Edward de Bon “Lateral Thinking”. It was the process of thinking to solve a problem postulated by Dr Edward de Bono back in the late 60’s. This uses an unconventional or even contrarian approach in viewing the problem or challenge or situation with fresh eyes. The general known thinking to solve is logical thinking, which is to arrange the sequence of events to arrive at the solution. In contrast, lateral thinking progresses sideways and correctness is not the outcome of finality. With lateral thinking, we move “sideways” to try different perceptions, concepts and points of entry and with the solution obtained, we can see the logical connection between problems and solutions. The wrongness of intermediate steps is immaterial to the outcome of events. This is one decision-making process that can help us resolve the issues in practice and help us better approach the problem.

News Roundup

Direct Tax

  • CBDT specifies the manner for the constitution of the collegium to decide deferment of appeals under Sec. 158AB
  • CBDT notifies Form 69 for making an application for re-computation of income due to disallowance of surcharge/cess.
  • Due date to file modified return extended to 31-03-2023 if the order of business organization is issued till 30-09-2022.
  • CBDT issues revised guidelines for Compounding of Offences under the Income-tax Act
  • CBDT issues additional guidelines on deduction of tax at source u/s 194R
  • Requirement to quote PAN on cash deposit/withdrawal not applicable on Central/State Govt. and Consular Office: CBDT
  • ICAI releases a technical guide on the audit of charitable institutions under Section 12A.

Indirect Taxes

At the outset, let me acknowledge the smooth functioning of the E-Way bill and E-invoice portal maintained by NIC with the following numbers for Sep 2022.

More than 37.74 Lakhs E-way bills were generated

More than 72.94 Lakhs E-Invoices were generated.

Government by notification has appointed October 01, 2022, as the date on which various provisions of the Finance Act, 2022 are to come into force. The major one is the extension of the time limit for rectification of errors and claim of input tax credit till 30th Nov of the subsequent year. Recent Clarification has also provided clarity that the above will be effective for FY 2021-22 too.

Corporate and Allied Laws

The MCA introduced the Companies (Corporate Social Responsibility Policy) Amendment Rules, 2022 bringing changes like the establishment of a CSR committee for unspent CSR amount, change in expenditure for impact assessment and revised format for the annual report on CSR activities.

The Ministry of Finance has also notified a new framework for overseas investments by Indian investors. The new framework is aimed at liberalizing compliance and approval requirements in order to provide greater access to Indian investors to markets outside India.

Happy Reading!

Yours’ faithfully,

CA. Pramod Srihari