The Chartered Accountant Student

WICASA - Akola Branch E-Newsletter-July 2019

INDEX

□ ICAI MOTO

□ WICASA CHAIRMAN’S COMMUNICATION

□ BUDGET HIGHLIGHTS 2019

□ ARTICLES

□ HIGHLIGHTS OF WICASA EVENTS PHOTOGALLERY

□ UPCOMING EVENTS

□ DUE DATE CHARTS OF AUGUST

Warm Greeting to all the readers!

WICASA CHAIRMAN’S COMMUNICATION

My Dear Students,I am much delighted to communicate to you all on this particular issue of newsletter as we, the CA fraternity enter in its 71st glorious year of our existence.As we celebrated CA Day on 1st July 2019 the platinum jubilee year of our Noble profession started.As a CA Student one must understand the tireless effort of ourtorchbearers to uphold a triumphant tradition of converting challenges into opportunities. Over the 71 years we could be able to justify ourautonomy which was granted by the founding fathers of ourconstitution.Our role has been shifted from backroom to boardroom and ourdynamic journey of excellence, integrity & independence was wellappreciated by the Industry, Government and the society.You may be surprised to note that the present strength of 300000 (Approx) Chartered Accountants was only 1689 in nos on 1st April 1950 and Sri G.P. Kapadia, the founder present of the ICAI was the first member of the ICAI.The Board of studies which takes care of all student’ activities was constituted in 1955-56. The Board is constantly activesince then& taking continuous endeavor to develop and revise our education and training scheme in line with the requirement of time. We are the pioneer of postal tuition scheme which was later followed bymanyuniversities. We are the body who guide the commerce education in the country and we are the body who could bring the information technology in the accounting system.

. The Board of Studies started diploma course on ISA, forensic audit and is closely working on cyber security, artificial intelligence, could accounting, block chain etc. The matter of pride does not stop or limit to the formation of Board of studies. From 1955-56 we have constituted many committees which are continuously supporting the government and industries in framing the taxation and corporate laws including the accounting and auditingprincipals.We are the body which helps the government with budget formation by providing pre & post Budget memorandum.Our presence is not limited to the boundaries of our country. Our first foreign chapter came in Doha (1980-80) and today we are having 34 global chapters. We are associated with many global accounting bodies and our nominees hold key position at global forum. We besides keeping our professional upliftment, discharge our social responsibility in a very responsible mannerBe it Gujarat earthquake Tsunami, Uttarakhand flood or SwacchaBharat Abhiyan our institute has always come forward and contributedconsiderably.The most glorious moment came in the year 2005 when the thenvisionary President of India Dr. A.P.J Abdul Kalam uttered the goldenwords for us.“PARTNER IN NATION BUILDING”Dear students the enlightenment shared here is just to make

youunderstand that “SMILE…. you are pursuing a noble profession”

With Best wishes for you ensuring results!

Thank You,

CA Jalaj R BahetiChairman WICASA Akola Branch

PREFACE

The E-Newsletter ofWestern India Chartered Accountant

Students Association (WICASA), Akolais one of the channel to reach

student of Chartered Accountancy Profession to keep them updated with

the latest amendments in Law and Various Acts. Its motive is to

encourage students to come forward with their writing skills and

actively participate in WICASA Events.

The team behind this E-Newsletter have put their hard efforts for

collective improvement of pursuant of these common professions. In

this regards, we request you to contribute to these “Initiative of Monthly

E-Newsletter” by enthusiastically providing quality materials (articles,

legal updates, case law analysis, crosswords puzzles).

We believe that, with your active participation, we shall be

regularly providing you the E-Newsletter on Timely Basis. Hope this E-

Newsletter will be useful to you all. Let us make this initiative “both

way efforts” and a grand success.

The views expressed in thisE-Newsletter are of respective

auditors and neither the Akola Branch of ICAI nor WICASA,

Akola authenticate such views. Yet maximum efforts are put to ensure

the correct and up -to-date information in the E-Newsletter.

For contributing to WICASA, Akola E-Newsletter through articles

or other materials kindly contactCA Prasad Deshpande & Miss.

Shivani Kariya .

Budget 2019HighlightsTaxes

1. No change in personal income tax rates2. Increase in surcharge on super rich: Three percent surcharge for Rs

2crore income; 7 percent on Rs5crore and above

3. Annual turnover limit for 25 percent corporate tax raised to Rs 400crore from Rs 250crore

4. Taxpayers with annual turnover of less than Rs. 5crore to have to file only quarterly

5. Direct tax revenue has increased by 78 percent

6. Additional Rs1.5 lakh deduction on home loans

7. Interchangeability of PAN and Aadhar for ITR who don't have PAN cards

8. Two percent TDS on withdrawals of Rs.1crore in a year from bank accounts for business payments

9. Government waives MDR changes on cashless payment

Economy1. Targets to become a $3 trillion economy in FY20, $5 trillion in a few

years

2. Government proposes changes to kickstart domestic and foreigninvestment

3. Will create the blueprint for gas, water grids and regional airports4. Government has proposed to expand Swacch Bharat to include solid

waste management in every village

To boost investment1. To liberalise FDI in aviation, media, animation and insurance

intermediaries

2. To implement enabling measures to boost International Financial Service Centres (IFSCs)

3. To set up a Credit Guarantee Enhancement Corporation4. To initiate steps for electronic fund raising programme for listing of

social enterprises, voluntary organisations

5. To hike statutory limits for foreign investments in some companies

Market reforms1. Asks SEBI to evaluate hiking minimum public shareholding to 25

percent from 35 percent

2. Government will work with exchanges to allow AA bonds to be used ascollateral

3. Proposes rationalising and streamlining of KYC (know your customer) norms for Foreign Portfolio Investors (FPIs) to make it investor-friendly

4. NRI portfolio route to be merged with FPI for seamless investment in stock markets

5. Credit Guarantee Enhancement Corporation will be set up in 2019-20, action plan to deepen markets for long-term bonds with specific focus on infra sector to be put in place, Sitharaman said

6. The government also plans to take up measures to make RBI and SEBI depositories inter-operable

7. The government will allow FPIs/NRIs to subscribe to listed debt papers of REITs and InvITs

Small businesses/MSMEs1. The government proposes to extend pension benefit to three

crore retail traders with an annual turnover less than

Rs1.5crore under Pradhan Mantri Karam Yogi Man Dan

Scheme

2. Centre will create a payment platform for MSMEs for payment ofbills

3. Hundred new clusters will be set up in 2019-20 to enable 50,000 artisans to come into the economic value chain

4. Will set up 10,000 new farmer producer organisations

5. To start television programme exclusively for startups

Railways1. Railways to be encouraged to invest more in suburban rail

network via special purpose vehicles (SPVs) and enhance

metro rail network through public-private partnerships

2. Railway station modernisation programme will be launched thisyear

Education1. The government will bring in new education policy to propose

changes in school, higher education2. The government also proposed to set up a national research

foundation to fund, coordinate and to promote research in thecountry

3. National Research Foundation will assimilate research grants by ministries, Sitharaman said

4.A Gandhi-pedia is being developed to sensitise youth about Mahatma Gandhi's ideas

5.Draft legislation for higher education commission of India to bepresented

6.Proposes Study in India programme to attract foreign students

7.National Sports Education Board to be set up under Khelo India scheme

8.Allocate Rs 400crore for world-class higher education institutions in financial year 2020

Labour reforms1. Government to streamline multiple labour laws into a set of four labour

codes2. Sitharaman said that the government plans to focus on training new age

skills like AI, robotics, 3D printing

Ease of living

1. Rs 3,000 pension per month for informal sector workers

2. Aadhaar card under 180 days for NRIs on arrival in India3. The government to open embassies in countries where India doesn't

have a resident diplomatic mission as yet

Women empowerment1. Nari tu Narayani: Women SHG Interest Subvention Programme to be

expanded to all districts in India

2. Rs1 lakh loan to be provided for SHG women members

3. Every verified woman SHG member with a Jan Dhan account can avail Rs 5,000 overdraft facility

Banks1. Allocate Rs 70,000crore for PSU bank recapitalisation

NBFCs1. Fundamentally sound NBFCs to keep getting funding from banks

2. To allow FIIs and FPIs investment in debt securities issued byNBFCs

Agriculture/fisheries1. Government to invest widely in agriculture infrastructure

2. Support private entrepreneurship in value addition in agriculture3. Proposes Pradhan Mantri Matsya Sampada Yojana to address

critical infrastructure gap in fisheries sector

Transportation1. To carry out comprehensive restructuring of National Highway

programme

2. Cargo volume on Ganges to increase four times over the next fouryears

3. In second phase of Bharat Mala project, states will be helped to develop roadways

4. A total of 1,25,000 km of roads will be upgraded under PradhanGram

5. Sadak Yojana under Phase III at estimated cost of Rs 80,250crore

Aviation1. Time right for India to enter into aircraft financing and leasing

2. Will create congenial atmosphere for development of MROservices

3. To harness India's space ability commercially, New Space India

(NSIL) has been incorporated to tap the benefits of ISRO

Power1. Package for power sector tariff and structural reforms to be unveiled soon

Retail1. Local sourcing norms to be eased for single-brand retailFDI

Real estate1. Will finalise a model tenancy law and circulate to states; and

propose steps for rental housing

2. Govt proposes setting up 1.95 crore houses under Pradhan Mantari Awas Yojna (Rural)

ARTICLES

Goldy Panjawani

What is an E – Way Bill?waybill is a receipt or a document issued by a carrier giving details and instructions relating to the shipment of a consignment of goods and the details include : Name of consignor, Consignee, The Point of origin of the consignment, its destination, androute.

Electronic Way Bill (E-Way Bill) is basically a compliance mechanism, Wherein by way of a digital interface the person causing the movement of goods uploads the relevant info,prior to the commencement of movement of goods and generates e-way bill on the GST portal.In short E-WAY Bill is an electronic document generated on GST Portal evidencing movement of goods.Interception or inspection of vehicles carrying goods by Properofficer…..When the goods are in movement, a proper officer may intercept or inspect any vehicle that is carrying goods.A vehicle may be intercepted either for verification of documents or inspection of goods.He shall verify all the documents that the transporter is carrying including an E-way bill, invoice etc.However, the officer cannot conduct another physical verification of the same goods when a physical verification has already been conducted in any state or union territory.As an exception, the vehicle may be stopped if the officer has specific information about tax evasion

Documents to be filed on an interception/ inspectionThe officer shall file the following documents on interception:

• A summary report in Form GST EWB- 03 Part A within 24 hours ofinspection

• A final report in Form GST EWB- 03 Part B within 3 days ofinspection

Consequences of discrepancy Not Found / Found

A. No discrepancy found on inspection• If no discrepancies are found during the inspection and verification

process, an order inForm GST MOV-05 shall be passed releasing the vehicle and goods and the vehicle can move on.

The entire process mentioned above should happen simultaneously and the process should be completed within 3 days from the order of inspection.

B. Discrepancy found on inspectionIf during the inspection and verification process, the officer feels that the goods have to be detained, the officer may take the followingactions:Pass a detention through Form GST MOV- 06A notice levying the tax and penalty through Form MOV- 07 Action to be taken by owner w.r.t. theorder…On receiving the notice to pay tax and penalty, the owner of goods may take the followingactions:A.Accept the tax and penalty

B.Dispute the tax and penalty

Action available to the owner

Accept the tax & penalty Dispute the tax & penalty

• HE CAN EITHER PAY THE TAX & PENALTY

• HE CAN FURNISH BANK GUARANTEE EQUAL TO SAID AMOUNT

• TAX AMOUNT WITH PENALTY SHALL BE PAID WITHIN 7 DAYS

• THEREAFTER, AN ORDER RELEASING THE GOODS IS PASSED IN GST MOV - 05

• IN THIS CASE THE OFFICER SHALL CONSIDER THE OBJECTIONS AND PASS A SPEAKING ORDER IN THE SAID AMOUNT FORM GST MOV - 09

Advance Tax

Aditi Kurhekar

What is Advance Tax?Advance tax means income tax should be paid in advance instead of lump sum payment at the end of the year end. It is also known as ‘pay as you earn tax’. You need to pay them in installments as per due dates provided by the Income Tax department.Advance Tax can be simply understood as an advance estimation of total taxable income and,thereafter, a presumptive calculation of the tax amount payable by the assesse for the relevant financial year.

Applicability:

Advance Tax Liability is applicable on all tax payers, whether salaried, freelancers or businesses.In case of salaried tax payers, if the employer deducts tax at source or TDS, then there is no further need of payment of advance tax. In other words, For Individuals with Salary as the sole source of income, Advance Tax would be taken care by the TDS deducted by the employer at the time of payment of salaries as reflected in Form 16 and hence there would hardly be any Advance Tax payable.

.

However, if such an assessee has any other income other than salary, then he/she is required to meet advance tax liability for such income. Such incomes may include capital gains on shares or house property, interest on investments, etc. after making appropriate deductions for losses, if any

How to Calculate Advance Tax?Tax can be computed on the current income (estimated by the taxpayer) at the rates in force during the financial year. Income received in the previous financial year can be taken as the estimated taxable income for the calculation of advance tax liability.

In case of businesses and professionals like doctors, lawyers, etc. resident in India, whose gross receipts or turnover of businesses is less than ₹ 2 croreper annum, they are exempted from the mandatory payment of advance tax. They have to pay 100% Advance Tax by 15th March. Such businesses are relieved from maintaining books of accounts. However, they are not allowed to deduct any other business income against this business income.

*Presumptive Taxation Scheme covers Sec 44ADA and Sec 44 AD Income

Penalties related to Advance Tax

Penalty in the form of interest is applicable on the late payment of advance tax.If the advance tax is not paid according to schedule, then assessee will have to pay an interest on the late payment. The interest payable can be rounded off to the nearest hundred. This interest falls under 2 sections:

1. Section 234B2. Section 234C

Section 234B: Interest for defaults in payment of advance tax

This penalty provision activates in two cases:

1.If the Assessee was liable to pay advance tax, but failed to deposit that.

2.If the amount deposited was less than 90% of the tax to bedeposited.

• In both the above cases, assessee will be levied a Simple Interest @1% per month or part of the month. Please remember, if you deposited the advance tax which was more than 90% of the total tax, then no interest will be charged from you.

• This interest is chargeable from 1st April of the Assessment Year.

• It can also be charged from the initiation date of assessment year to the date of determination of total income under sub-section (1) of section 143 and where a regular assessment is made, to the date of such regular assessment, on an amount equal to the assessed tax or, as the case may be, on the amount by which the advance tax paid as aforesaid falls short of the assessed tax.

In calculation of 90% we will consider the amount of tax payable after TDS.

Consider this example:

The tax liability of the Individual Assessee was Rs. 240000 while TDS due was Rs. 40000. Advance tax already paid was Rs 120000.

Calculation of Interest:Tax Liability was Rs.240000, while TDS was Rs.40000. Tax Assessment: Rs.200000 (240000-40000)Now IT department assesses, whether partial payment comes under limit of 90%. Rs200000* 90% = Rs180000

Therefore amount of Tax paid was less than amount due by Rs 60000 (180000-120000).

The total interest due under section 234B will be: Rs 60000 * 1%* 4 months (April-July) = Rs 2400.

The interest is taken till July because which is the due date of payment for individual assessee and assumed as month of return filing.

In addition to this, if you have been given a refund by the Income Tax Department but on assessment it is found that no refund or less refund was due to the taxpayer, then you would be asked to return the excess refund with an interest of 0.5%.

Section 234C: Payment of Advance tax not in time or Interest for deferment of advance tax.

• Under this section, if advance tax is not paid on scheduled dates,an interestof 1% will be charged. This interest is for deferment in instalments ofadvance tax. You will have to pay interest of 1% on advance taxif you donot pay:

15% of your tax liability by June 1545% of your tax liability by September 1575% of your tax liability by December 15100% of your tax liability by March 15

• The interest applicable issimple interestand not compound interest. Theperiod for which you need to pay the interest will depend on how manymonths late you are on the payment. The interest is computed from thedue date to the date of payment.

• For example, let us say you were supposed to have paid Rs.1 lakh as taxby September 15, but you make the payment only on December 15. Thenyou are liable to pay 1% interest for a period of 3 months. In this case, theinterest would come to Rs.3000.

FAQs on Advance Tax Liability:Q: I am salaried professional, do I have to file for Advance TaxLiability?

A: If the employer is deducting TDS, then there is no requirement to calculate and file for Advance Tax Liability on the income derived from salary. However, if you are in receipt of income from any other source and the advance tax payable is ₹10,000 or more, then you have to file for Advance TaxLiability.

Q: I am 62 years old, hence a senior citizen. Do I have to pay advance tax?

A: In case, you don’t own and maintain a business, you don’t have to pay advance tax. However, if you are in receipt of income from business then such exemption does not apply any longer.

Q: I run a small shop and my turnover for the business is lessthan ₹ 2 crore annually. I have opted for presumptive schemeunder section 44AD where my net income is calculated as 8%of the total cash receipts. I incurred some business expensesand maintain few electronic gadgets on which I wish to claimdepreciation. Can I claim these deductions?

A: No. Once the business is listed under Presumptive Scheme under section 44AD, no business expenses can be allowed for deductions. In this case, you cannot claim the deductions for business expenses and depreciation on electronics.

Q: What if I declare higher or a lower income for a financialyear?

A: The taxpayer can declare a higher amount for income and pay advance tax on it, accordingly. However, if he declares a lower income and pays advance tax on it, then he is mandated to maintain the books of accounts for the business and get them audited in the end.

Q: I declared a higher income and paid advance tax accordingly.However, in the end of the year my total tax liability is less thanwhat I have already paid. Will I get the excess amount back?

A: Yes. If the advance tax is paid in excess as compared to the total tax liability for that relevant financial year, then the amount paid in extra gets refunded from the Department’s end along with an interest @ 6% p.a. where the tax paid in excess is more than 10% of the total tax liable.

Lastly to say,

Lastly to say,

Logically, Advance Tax receipts help the Government to receive constant flow of tax receipts throughout the year so that Government can incur its expenses timely rather than receiving all tax payments at the end of theyear.“Procrastination is like credit card, it’s a lot of fun until you get the bill” So don’t procrastinate and pay your advance tax liabilities time to time.

HIGHLIGHTS OF WICASA OF EVENTS PHOTOGALLERY

CA Day Celebration

INDOOR GAMES

Annual GST Return And GSTAudit

National Talent Search

DUE DATES FOR AUGUST

Particulars Due Dates

TDS/TCS Liability Deposit 7thAug

GSTR3B 20thAug

GSTR1- Monthly (Taxpayer exceeds 1.5Crore) 11thAug

Income Tax Return for FY 18-19 31stAug

PF & ESIC Payment 15thAug

GST Audit 31stAug

GST Annual Return 31stAug

Independence Day Celebration, National Student Conference At Nagpur

Kaun Banega CA