MRink - Finance and Income Tax

Recent press release issued by government on availing benefit of exemption of LTC to Non-Central Government Employees: The benefit of Income-tax exemption for the payment of cash equivalent of LTC fare now made available to the non-Central Government employees as well. Non-Central Government Employees also can now avail the benefit of income tax exemption on payment of cash equivalent of LTC fare, along the lines of the benefit made available to the Government Employees vide OM Dated 12th October 2020.  You may find below for your reference: If you have any query related to the article please reach us via mail :-mrinkblog@gmail.com  Advisory: Information relates to the law prevailing in the year of publication as indicated. The above article is only to enable public to have a quick and an easy understanding. Viewers are advised to ascertain the correct position/prevailing law before relying upon any document.

Introduction: ICDSs were introduced vide notification No. 87/2016 dt. 29.09.2016 applicable from A.Y. 2017-18 onwards [Section 145(2) of the Income Tax Act, 1961] Applicability of ICDSs: Applicable for computation of income under head "Profits and Gains of business/profession" and "Income from Other Sources" Applicable to all the assessees (other than individual/HUF not liable to tax audit u/s. 44AB) following mercantile system of accounting In case of conflict between the provisions of the Income Tax Act and ICDS, the provisions of the Act shall prevail over ICDS to that extent Clarifications made vide Circular No. 10/2017: a. Interplay between ICDS-I and Maintenance of Books of Accounts: It is clarified that the Accounting Policies mentioned in ICDS-I are required to be followed only for purpose of computation of income and not for maintenance of books of account. b. Applicability of ICDS in certain cases: The clarifications have been issued by the CBDT on app

Recently, the Hon'ble Delhi ITAT has ruled in favor of the assessee by allowing the ground that tax treaty rate to be applied over dividend distribution tax rate. The ruling has been held on the basis of considering the concept of "substance over the form". Following are the synopsis of the said ruling of the Hon'ble Delhi ITAT in case of  Giesecke & Devrient (India) Pvt Ltd. Vs. Addl. CIT (ITA No. 7075/Del/2017). Matter of the case :   Applicability of Tax treaty benefits on DDT in case of dividend distributed to foreign shareholders. Additional ground raised before ITAT : Seeking refund for DDT paid in excess of applicable tax rate prescribed as per tax treaty between India and Germany Extract of the Rulin g in the above context :   “…the liability to DDT under the Act which falls on the company may not be relevant when considering applicability of rates of dividend tax set out in the tax treaties. The generally accepted principles relating to interpretation of

Ministry of Finance has extended the due dates of furnishing of Income  Tax Returns and Audit Reports for Assessment Year 2020-21 in its Press release dated 24th Oct, 2020. As per the said Press Release,  Income Tax Return filing due date for the entities subject to tax audit for Assessment Year 2020-21 is extended to 31st Jan, 2021 (Original due date - 30th Nov, 2020*) Income Tax Return filing due date for International Transactions taxpayers (Transfer pricing cases) for Assessment Year 2020-21 is extended to 31st Jan, 2021    (Original due date - 30th Nov, 2020*) Income Tax Return filing due date for other taxpayer for Assessment Year 2020-21 is extended to 31st Dec, 2020   (Original due date - 30th Nov, 2020*) Tax Audit Report filing due date for Assessment Year 2020-21 is also extended to 31st Dec, 2020   (Original due date - 31st Oct, 2020*) Further, it is worthwhile to note that, Interest u/s. 234A & u/s. 234B shall continued to be levied for delayed payment of self-asses

  Relief u/s. 89 is nothing but the tax relief available due to receipt of Salary arrears/ advances, so let's understand what is it and how and how to claim it. 1. Scenario in which Relief u/s. 89 is available : We all know that the income received as salary is taxable on receipt basis, which may also includes s alary arrears/  a dvance . Now, due to receipt of such arrears/ advance, the taxable salary of current year  might get assessed at a rate higher than that at which it would otherwise have been assessed and due to which one may have to pay higher taxes. To avoid this unreasonable tax incidents, the relief has been granted u/s. 89 of the Income Tax Act, 1961 for the amount of  difference in the tax liability arose due to receipt of arrears/ advances. Further, it is important to note that  relief is available only if tax liability for current year is getting higher due to receipt of such arrears/ advances but in case, if there is no extra tax liability the relief is als

Recently, CBDT has issued a notification which clarifies the compliance requirements for the assesses, opting for concessional rate of tax under New Tax Regime, i.e., Section 115BAA, Section 115BAB, Section 115BAC & Section 115BAD. The CDBT has made the following amendment (Income-tax (22 nd Amendment) Rules, 2020) vide Notification No. 82/2020 dated 01.10.2020: 1.      Amendments in Income Tax Rules, 1962: A.   Maximum depreciation on any block of assets has been restricted to 40% In the said notification, the rate of depreciation has been restricted to 40% i.e., one can claim depreciation maximum upto 40% on the WDV of block of asset. The following has been provided in respect of rate of depreciation: “Provided that the allowance under clause (ii) of sub-section (1) of section 32 in respect of depreciation of any block of assets entitled to more than forty per cent. shall be restricted to forty per cent . on the written down value of such block of assets in case of -