The government vide notification dated June 24 2020 has extended the time limits of various tax-compliances. This is aimed to provide further relief to the individuals due to ongoing corona virus pandemic.
The benefits/extensions include:-
For FY 18-19, ITR can be filed up to 31.7.20.
For FY 19-20
- ITR can be filed up to 30.11.20;
- Tax audit report can be filed up to 31.10.20;
- Self assessment tax up to INR 1 lakh can be paid up to 30.11.20;
- Investments (eligible for deduction u/s 80C & 80D) can be made up to 31.7.20;
- Investment for claiming roll over benefit / deduction u/s 54 to 54GB (capital gains) can be made up to 30.09.20 ;
- TDS certificate (pertaining to TDS deducted on salary payments) can be furnished up to 15.8.20;
- TDS/TCS statements for Feb 20 or Mar 20 or quarter ending Mar 20 can be delivered up to 15.07.20 (government) and up to 31.7.20 (others);
Important Statutory developments
- CBDT notifies ‘301’ as Cost Inflation Index for FY 2020-21.
- CBDT has amended Rule 2BB to enable assessee opting for alternative tax regime u/s 115BAC to claim exemption for tour, travel and conveyance expenses incurred in performance of duties.
- CBDT has further extended the various due dates, which were earlier extended up to June 30, 2020, to provide relief to the taxpayers under the current covid pandemic.
- CBDT has amended Rule 11UAD to provide that section 50CA shall not apply to transfer of any movable property, being unquoted shares, of a company and its subsidiary and the subsidiary of such subsidiary by an assessee wherein NCLT has approved oppression and mismanagement resolution plan.
- Any movable property, being equity shares, of the reconstructed bank, received by the investor/investor bank under the Yes Bank Limited Reconstruction Scheme, 2020 shall not be taxable under section 56(2)(x).
- CBDT has relaxed eligibility conditions for investment fund set up by a cat–I FPI registered with SEBI Category u/s 9A (exemption from business connection in India).
Important Judicial Precedents
- The Bombay High Court in the case of Essar Shipping Limited v ITO held that waiver of loan cannot be brought to tax as subsidy u/s 28(iv).
- The Kol-ITAT in the case of DCIT v. EMC Ltd. held that retention money’ being contingent upon satisfactory completion of contract work is taxable in actual year of receipt.
- The Kol-ITAT in the case of Bhagwant Merchants Private limited vs ITO held that legally no case can be reopened u/s 147 if AO has not applied his mind on information available for recording reasons. Further, it stated that on merits, no addition u/s 68 as cash credit can be made to an income declared as sales as it would result in double taxation.
- The Del-ITAT in the case of Exotica Housing & Infrastructure Co Pvt Ltd v ITO held that all payments received from the sister company cannot be treated as deemed dividend u/s 2(22)(e) but only payments which bear the characteristics of loans and advances. It further stated that advances given for purely temporary financial accommodation do not attract deeming fiction u/s 2(22)(e).
- The Madras High Court in the case of S. Gurushankae vs CIT held that tax holiday u/s 80IB cannot be granted for bogus transactions.
- The ITAT-Bang in the case of S.K. Bhaskar Raju v. ACIT held that the assessee would be allowed land development and maintenance charges as revenue expenses as land belonged to a third person and the assessee incurred expenses in order to sell the land.