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Tuesday, 19 December 2017

Dynamic Impact of GST on Indian Economics

GST is an indirect tax which was introduced in India on 1st July 2017 and was applicable throughout India. GST is not going to be an additional new tax but will replace other indirect taxes. As the GST was introduced by replacing the old indirect tax structure it will defiantly affect the Indian Economy. Now we can take look on them. 

From the viewpoint of the consumer, customers would now have paid more tax for most of the goods and services they consume. The GST implementation has a cost of compliance attached to it. As per the RBI’s latest monetary policy statement the implementation of the GST is not expected to have a material impact on overall inflation rate. GST removes the cascading effects of taxes, this will lowering the burden on the common man.

In case of hospitality sector the net tax rate under old tax regime was around 20 to 27 % with the scope of claiming the input tax credit against the indirect tax Liabilities.Under the new tax structure, the hospitality industry benefits with a consistence taxation system. GST Council decide to fixed tax rate @ 5% without giving the facility of input tax credit. Cancellation of ITC facility may affect the stakeholder’s ITC benefit & at the same time reduction in the tax rate may give consumers free from heavy tax burden.

Traders below 20 lakh annual turnover are exempt under GST as compared to the old tax structure of Rs 10 lakh in indirect taxes. Those between the threshold and composition turnovers will have the option to pay a turnover based tax or opt to join the GST regime. Those above limit will need to be within framework of GST. Now government can stop the reverse charge mechanism system for some period, this will benefit to unregister dealer for that period only. In a simple language non-register dealer was ultimately ignore by other register dealer for smooth administration of GST.

Despite of the economic slowdown, India's Fast Moving Consumer Goods i.e. FMCG products has grown consistently during the past three – four years reaching to $25 billion at retail sales in 2008. Implementation of proposed GST is expected to fuel the growth and raise industry's size to $95 Billion by 2018.

Implementation of GST could help government raise tax revenues and reduce fiscal deficit, which has been around 4.5 per cent in the last three years. By removing cascading effect, layers of taxes and simplifying structures, the GST would encourage compliance, which is also expected to widen the tax base. GST was introduced to replace all indirect taxes so the cost of maintenance of each department was ultimately reduced due to the effect of One Nation One Tax.

It is mandatory for all e-commerce operators to collect tax at the rate of two percent as TCS on the net value of sales made by suppliers through e-commerce operators. Such TCS has to be deducted in each state and deposited accordingly. The ecommerce operator has to report the product or service code individually with the applicable tax rate. This requires them to map every sale done by the dealer and ensure TCS is deducted at the right value. Additionally, the e-commerce operators will have to register in each state and file the reports separately on a monthly basis
.
In the conclusion part we can conclude that each and every transaction must be disclosed to government under the GST compliances. GST is definitely a good move to reform indirect taxation in India and has positive effects on GDP growth, Tax revenue, exports, and so many. But even after a decade Government have failed to implement it, due to variety of reasons like, compensation mechanism for the states, GST rates, and issues relating to food products, petroleum, and tobacco.



- Tushar Gopal Agrawal
 - CA Student






Friday, 10 November 2017

Latest GST/IGST Rate, Cut on Over 240 items

On 10 Nov,2017 GST Council conduct there 23rd meeting at Guwahati on Friday. In this meeting council slashed GST rate around 244 items, those goods which are covered under GST rate 28% out of this 80% items are shifted under 18% GST rate, on an around 177 items are now covered in 18% form 28% , Only 50 items are covered under the 28% GST rate, only which are luxurious items. A Big relief given by the government or its may be the impact of upcoming election. But overall its good decision taken by the GST council after implementing GST from July onward & So many Goods which are earlier at higher rate now Shifted to lower rate. Its a good move by Government over the GST rate & appreciable for Government that they learn time to time to accept challenges ot make easier for that they make changes in GST rate & in further process for future references, This new GST rate applicable from 15 Nov,2017. 

Click here to Download Official Latest GST Rate by Government

Monday, 23 October 2017

IPCC Taxation Paper Postponed Nov 2017

Taxation Paper-4 of Group-1, IPCC Exam is scheduled to be held on 9th Nov, 2017 stand postponed & examination of said paper shall now to be held on 17th Nov, 2017. Due to the state election in Himachal Pradesh , Shimla Center Students. ICAI notified it in general information, ICAI publish there notification on 20th Oct,2017. There is no change in Time & Venue as mention in admit card. The Same Admit Card will consider in the exam, no more further admit card will issue by ICAI. This notification applicable to Only for Shimla Center's students.    


Wednesday, 13 September 2017

IPCC RTP November 2017

Now, CA IPCC students can Download the RTP(Both group) of IPCC November,2017 issued by BOS(Board Of Studies) with the amendments applicable in the Exams. I think its a great initiative taken by BOS, from November, 2017 attempt, they providing all Books like(Study Material, Practice Manual & RTP or etc) through online only. 

Click here to Download the RTP November,2017

Wednesday, 23 August 2017

How to Take Input Tax Credit Under GST ?

Hello Friends, Today we Discuss a Topic which is very Important now a days. Regarding, How to take Input Tax Credit under GST of various Indirect Tax(VAT, Service Tax, Excise, Custom, Entry Tax or If any) ?
For taking ITC under GST, Government providing the Trans-1, Trans-2 & Trans-3 form. To fill the form correctly & properly, to mention ITC figure in the Trans Form.

Applicability of Trans Form are as follows, 

Trans-1 Form, applicable to those who have registered earlier under previous Indirect Taxation, for example VAT, Service Tax, Entry Tax & If any other. 

Following Conditions must fullfill for Trans-1 Form
In part 1
Any Excess credit from any previous indirect tax upto June,2017 can take that same credit under GST.



Wednesday, 16 August 2017

How to File GST return 3B

GST Return 3B file only through Online, there is no other option for filing the return, Regular return have option to prepare Offline & later to Submit online.
When we go for filing the of GSTR 3B, before that to collect the all necessary data(like Purchase Register, Sale Register & Expense Register)
GSTR 3B is not applicable to those who opt the composition scheme, For Composition Dealer Quarterly return will file on regular date as mention by the Government.
Last Due Date to file GSTR 3B are 20 Aug,2017 for the month of July & 20 Sep,2017 for the month of August.     

Following are the Steps & Instruction regarding Filing GST return 3B
  • To visit on website of www.gst.gov.in for login
  • To Select the return Dashboard 
  • To Select the Current Financial Year 2017-18 & In this to select the month(for example July)
  • To Click on GSTR 3B for further procedure 
  • In GSTR 3B there are 7 points
  • In point no 3.1, To mention the Sale Details in the form of Out word Supply, In this to mention Aggregate Sale with classification under IGST, SGST & CGST. & If any payment covered under RCM during the month, on that GST can not be setoff against ITC if any available, that amount must pay. In later month, we can get ITC on RCM.
  • In point no 3.2, To Declare that sale Details which are covered under Inter-State sale(Sale to Composition Dealer & Un-Registered Dealer Person)
  • In point no 4, To mention the Input Tax Credit figure only with the classification under IGST, CGST & SGST
  • In point no 4.1, To Declare those purchase which purchases from unregistered Dealer & those purchases are NIL rated or Exempted 
  • To Click on Save button, after save the data to submit button will get enabled & than you can submit the GST return 3B(please note that, after submission no modification or amendment is possible, so carefully feed the data in appropriate column & ensure that details are completely & correctly feeded)
  • In the System there are three payment option, you can choice any one, options are Net Banking, RTGS(Real Time Gross Settlement)/NEFT, Offline payment(In this you can generate the challan, pay the Tax at Bank Counter)
  • In point no 6, After payment of GST if any, To adjust the ITC manually against the liability. After that to Click on Offset Liability button to pay off the liabilities, If its successful than you can proceed for return filing, without Offset liability you cann't proceed for return filing
  • To Click on Declaration Statement
  • To Select the Authorized Signatory for filing the return
  • To Click on File GSTR 3B button with DSC or EVC
  • After Submission, Successfully filing will appear & Acknowledgement will get generated. 

How to File Online Income Tax Return By Own

Now, those have Income from Salary/Pension & those who have Income from Other Sources like Interest on FD, Interest on RD, Interest on Saving Bank Account or any other Income covered under Income from other sources, Can file there Income Tax return Online.
Before filing the Income Tax return, Collect all the necessary Documents like Form no 16, form there employer, Home Loan Interest Certificate, FD interest Certificate or If any.

Those are facing any problem regarding filing the Income Tax return, Just follow the steps given below & read the instruction carefully.

Saturday, 22 July 2017

List Of Documents Required For Trust Registration u/s 12A & 80G


                         Today, We discuss a Topic related the Documents, which are required by Income Tax Department for registered the Trust under Income Tax Act, 1961.
Now, People are facing the problem to registered their Trust under the Act, because every one, don't have complete knowledge about Documents required by the Income Tax Department.
Following are list of Documents required by the I.T. Department for Trust registration -
  • Form no. 10A with Court Fee stamp of Rs. 5/-
  • Attested Copy of Certificate from Charity Commissioner/ Asst. Registrar of Societies.
  • Attested Copy of Trust Deed Approved by the Charity Commissioner.
  • Declaration u/s 13(109c) of S.T. Act, 1961 duly signed by all Trustee.
  • Form no. 10G with Court Fee stamp of Rs. 5/-.
  • Reason for Delay, If any.
  • Copies of I.E. Acts Balance Sheets, Audit Reports in Form no. 10B for last 3 years or since Creations of Trust as applicable.
  • Copies of Acknowledgements of return of Income of Trust for last 3 years or as applicable.
  • Note on Activities of the Trust for last 3 years or since creation of the Trust as applicable.
  • List of Trustees with Addressees- Like Pan Card Copy & Aadhar Card Copy.
  • A Certificate regarding "No Change" in the Trust Deed/Objects since creation last approvals u/s 80G of the Act.
  • List of Donors for Rs. 5,000 /- and above for last 3 years or since creation of the Trust as applicable.
  • Copies of the Form no. 10 with Assessing Officer in the case of accumulation of Surplus.
  • Copy of Registration u/s 12A
  • Copy of 80G approval Certificate 
Note - Three Sets of above Documents should be submitted to their respective C.I.T Office.

Tuesday, 11 July 2017

Latest GST Rate on 3 Jul, 2017

                      GST Council has made some changes in their Rates under Goods & Services. As below in the PDF file, latest rates of Goods & Service are available as decided by the Council & published by the GST Council as on 03, Jul 2017 and also providing the HSN & SAC codes.

Now, Governments continuously change their rate after getting the Feedback from the Various sources, Still GST rate for Builders & Developers not confirmed, its very difficult for every one to decide the GST rate. In the Proposal, Two rates were forwarded to the council 12% or 18%.


Click here to Download Latest GST Rate on Services as on 3 Jul, 2017

Friday, 7 July 2017

Forensic Audit & Auditor's Duty to Report on Fraud (PPT)

Forensic auditing is a blend of accounting, auditing and investigative skills. The information technology has led to innumerable benefits to businesses but at the same time it has made the businesses vulnerable to serious complicated frauds. Fraud means wrongful or criminal deception intended to result in financial or personal gain. Fraud always undermines the confidence of stakeholders. 

There is a strong nexus between prevention of fraud & good corporate governance. The total loan amount in fraud cases was increases every year. So it is our duty to detect fraud for that reason section 143(12) provides that an auditor has to report to the central Government. If fraud is less than specified amount, the report was made to Audit Committee or Board. Fraud committed by officers or employees of the company are to be reported only and not by the third parties. 

As per Section 143(12) an auditor has to report a fraud if fraud involves the amount as per rule 13(1) in the manner as per rule 13(2). As per 1st proviso auditor has report to the audit committee in the manner as per Rule 13(3). 2nd proviso requires company to report the details of frauds in Board Report in the manner specified in Rule 13(4). Rule 13(1) was introduced in Companies (Audit & Auditors) Rule 2014.

As per the Rule the specified amount is Rs. 1Crore. As per (Institute of Chartered Accountants of India) ICAI’s revised guidance note which was published in February -2016, an auditor reports a matter to audit committee immediately but not more than 2days of his knowledge & seeking their reply within 45 days.  Also auditor must specify the nature of fraud, amount and parties involved in fraud. 

If reply was not received then the auditor has to forward his report to The Secretary, Ministry of Corporate Affairs by speed post. While reporting to the Central Government auditor must sent his own details along with Form ADT-4. Here I made a power point presentation to explain the basic provisions of the Act.


-          Tushar G. Agrawal


-         






Monday, 3 July 2017

Demonetization-Impact on Indian Economy (PPT)



The aim of demonetization is to wash the stock of "Black money" out of the economy and get it into the licit, banked and taxable, part of the economy. The ultimate value of Black Money become nil. In short, through the demonetization government can make the black money value equals to zero. Demonetization effects on various economic entities like Small Traders, Households, Political Parties, Professionals like doctors, carpenters, utility service providers, etc. also on differential sectors like Manufacturing, Service, Agriculture, Foreign Inflows etc
Prepared By- Tushar Agrawal


Click here to Download PPT of Demonetization Impact


Wednesday, 14 June 2017

Different Types Of ITR Forms, From A.Y. 2017-18 With Certain Changes

Government has change the some certain things in the ITR Forms, from A.Y. 2017-18. Some ITR form has been merged or replaced with other ITR form.New Types of ITR Form are as follows to applicable to assesses.

1. ITR-1 (Sahaj) For Individual having income from-
  • Salaries, Pension, 
  • Income from One House property, 
  • Income from Other Sources (except lottery, winning & horse race)
  • Having agriculture income below or equal to Rs. 5,000/-
2. ITR-2 (ITR-2, 2A & 3 merged in ITR-2) For Individual & HUF having income from-
  • Salaries, Pension, 
  • Income from House Property can be more than One,
  • Share of partner Income from Firm,
  • Income From Capital Gain,
  • Income from Other Source, 
  • Foreign Income If any,  
  • Having agriculture income more than Rs. 5,000/-
3. ITR-3 (Existing ITR-4 replaced with ITR-3) For Individual & HUF having income from-
  • Salaries, Pension, 
  • Income from House Property can be more than One,
  • Income from Proprietary Business Or Professions 
  • Share of partner Income from Firm, 
  • Income From Capital Gain,
  • Income from Other Source, 
  • Foreign Income If any,  
  • Having agriculture income more than Rs. 5,000/-
4. ITR-4 (Sugam)(ITR-4S now ITR-4 Sugam) For Individual having income from-
  • Income from Presumptive Business Or Profession covered under section- 44AD, 44ADA & 44AE,
  • Income from One House property, 
  • No Capital Gain,
  • Income from Other Sources (except lottery, winning & horse race)
  • Having agriculture income below or equal to Rs. 5,000/-
  • No Foreign Income,If Any
5. ITR-5 For the Following Entities-
  • Firms,
  • Body Of Individuals (BOI),
  • Limited Liability Partnership (LLP),
  • Association Of Persons (AOP),
  • Artifical Judicial Persons,
  • Local Authorities,
  • Co-Operative Societies.
6. ITR-6 Applicable to-
  • For Companies except those are claiming the exemption under section 11.
7. ITR-7 Applicable to-
  • Section 139(4A)- Trust
  • Section 139(4B)- Political Party
  • Section 139(4C)- Fund/Medical institutions, News Agency, Any institutions or association covered under section 10(23A), Any institutions covered under section 10(23B), 
  • Section 139(4D)- College/Universities or any such institutions. 

Friday, 9 June 2017

List Of Services Under Reverse Charge In GST

                 The of rates of services were discussed on 19 May 2017 during the 14th GST Council meeting held at Srinagar, Jammu & Kashmir. The Council has broadly approved the GST rates for services at Nil, 5%, 12%, 18% and 28%. The list of services that will be under reverse charge as approved by the GST Council is given below. The information is being uploaded immediately after the GST Council’s decision and it will be subject to further vetting during which the list may undergo some changes. The decisions of the GST Council are being communicated for general information and will be given effect to through gazette notifications which shall have force of law.

GST Rates Schedules Of Services

          The of rates of services were discussed on 19 May 2017 during the 14th GST Council meeting held at Srinagar, Jammu & Kashmir. The Council has broadly approved the GST rates for services at Nil, 5%, 12%, 18% and 28% as listed below. The information is being uploaded immediately after the GST Council’s decision and it will be subject to further vetting during which the list may undergo some changes. The decisions of the GST Council are being communicated for general information and will be given effect to through gazette notifications which shall have force of law.

GST Rate Revised Schedule with Amendment/Addition

As per Discussion in GST Council Meeting held on 3rd June, 2017. Some Goods are amended in there respective schedule and added in different GST Rate Schedule. Rates are given in PDF format as below.

Click here to Download Amendments/Additions in GST Rate Revise Schedule

Click here to Download Addendum to the GST Rate Schedule For Goods Details

Tuesday, 6 June 2017

GST Rates Schedules Of Goods


GST rates schedules for Goods approved in GST Council meeting which was held on 18 May, 2017 at Srinagar(Jammu & Kashmir), The rates of goods were discussed on the 14th GST Council meeting The Council has broadly approved the GST rates for goods at nil rate, 5%, 12%, 18% and 28% to be levied on certain goods. The information is being uploaded immediately after the GST Council’s decision and it will be subject to further vetting during which the list may undergo some changes.

GST rates for certain goods like textile, footwear, biris, precious metals, etc. are yet to be decided by the GST Council. :- 

The rate structure for the following commodities is yet to be decided :-
1.      Biri wrapper leaves (tendu patta) – Ch. 14
2.      Biscuits – Ch.19 
3.      Biris – Ch. 24 
4.      Textiles – Ch. 50 to 63 
5.      Footwear – Ch. 64 
6.    Natural or cultured pearls, precious or semi-precious stones, precious metals, metals clad with precious metal, and articles thereof; imitation jewellery; coin – Ch. 71
7.   Power driven Agricultural, horticultural, forestry, poultry keeping or bee-keeping machinery, Harvesting or threshing machinery, machines for cleaning, sorting or grading, machinery used in milling industry and parts thereof [8432, 8433, 8436 and 8437].


Monday, 5 June 2017

ICAI New CA Syllabus-Foundation, Intermediate & Final

CA Final Course Syllabus
In Final there are total 8 Papers in 2 groups separately

Group I
Paper 1 - Financial Reporting (100 marks)
Paper 2 - Strategic Financial Reporting (100 marks)
Paper 3 - Advanced Auditing & Professional Ethics (100 marks)
Paper 4 - Corporate & Economics Laws (100 marks )*
Note-
Paper 4 have two parts
            Part I- Corporate Laws having 70 marks
            Part II- Economics Laws having 30 marks

Group II
Paper 5 - Strategic Cost Management & Performance Evaluation (100 marks)
Paper 6 - Elective Papers (100 marks)*
Paper 7 - Direct Tax Laws & International Taxation (100 marks)*
Paper 8 - Indirect Tax Laws (100 marks )
Note-
1. Paper 6 allows to the student to select their paper as per there choice, In this CA Institute give a option to select any One paper out of Six papers. Papers are -
        a. Risk Management
        b. International Taxation
        c. Economics Laws
        d. Financial Services & Capital Markets
        e. Global Financial Reporting Standards
        f. Multidisciplinary Case Study
2. Paper 7 have two parts
            Part I- Direct Tax Laws having 70 marks
            Part II- International Taxation having 30 marks










Thursday, 1 June 2017

Rent Free Accommodation (RFA)

Sometime, Employer provide the facility of Rent Free Accommodation to there Employee, But such facility is nor fully taxable or not fully exempted from the tax, There are condition regarding the taxability  under the head of Income From Salary under section 17.

There are two types Accommodation provided to there Employee
a. Unfurnished Accommodation
b. Furnished Accommodation

A. Under the Unfurnished accommodation, following are condition of taxability
1. Accommodation owned by the Employer, means company or employer have own accommodation provided to there employee. Under this amount taxable on the basis of Population:-

          Population                                    Accommodation Owned by Employer

  •  Above 25 lakhs                                   15% of Salary
  • 10 lakhs-25 lakhs                                 10% of Salary
  • Below 10 lakhs                                    7.5% of Salary
2. Accommodation taken on rent or lease by the employer or company and than provided to there employee.
          Population                                    Accommodation taken on rent or lease by Employer

  • 15% of Salary or Rent paid by employer, whichever is lower

B. Under the Furnished accommodation, following are condition of taxability

  • Compute Value of Unfurnished Accommodation               xxx
  • Add:- 10% of Cost of Furniture                                          xxx
    •           Value of Furnished Accommodation            xxx
Salary means:-
  • Basic Salary
  • D.A.(forming part or retirement)
  • D.P.(forming part or retirement)
  • All Taxable Allowance:- Bonus, Medical Allowance & etc.

For Example:-
A. If Employer have own accommodation:-
Mr A.have basic salary of Rs. 15000 p.m., D.A.(forming part or retirement)  Rs. 5000 p.m., & taxable allowance Rs. 5000 p.m. & provide the accommodation in mumbai
Ans :- Salary of Mr A have Rs. 25000 p.m. & Rs. 3,00,000 p.a., than 15% of Salary
           Rs. 45,000/- will be value of taxable perquisite


B. If accommodation taken on rent or lease by employer:-
Mr A.have basic salary of Rs. 15000 p.m., D.A.(forming part or retirement)  Rs. 5000 p.m., & taxable allowance Rs. 5000 p.m. & provide the accommodation by employer taken on rent of Rs 3,500/- p.m. in mumbai.
Ans :- 1. Salary of Mr A have Rs. 25000 p.m. & Rs. 3,00,000 p.a., than 15% of Salary
               Rs. 45,000/- 
           2. Rent paid by employer 42,000/- p.a.
                    15% of salary or Rent paid, whichever is lower 
                   Rs. 42,000/- will be value of taxable perquisite

* If any amount of rent paid by the employee, In any case than such amount of rent paid by employee will be less from the value of taxable perquisite, as a amount reimbursed to the employer.

                                                                                                      

CBDT extend the Due Date for furnishing Statement of Financial Transaction (SFT) 30th Jun

CBDT has been released the Press Release regarding the extend the Due Date of Statement Of Financial Transaction(SFT) to 30th June.

CBDT Extend the SFT Due Date, Click here to Download the Press Release

          The Statement of Financial Transactions under Rule 114E (5) of the Income Tax Rules, 1962, (the Rules) read with sub-section (1) of section 285BA of the Income Tax Act, 1961, (the Act) is 31st May, immediately following the Financial Year in which the transaction is registered or recorded, i.e for Assessment Year 2017-18 the last date for furnishing the said statement was 31st May 2017.

          Representations were received in the Board requesting for extension of the date of filing of the said statement of financial transactions on account of the teething problems arising and the volume of data to be compiled. In view of the said representations and in order to remove inconvenience and to facilitate ease of compliance, the Central Board of Direct Taxes, in exercise of powers conferred under section 119 of the Act, has extended the date of furnishing of the statement of financial transactions under Rule 114E (5) of the Rules, read with sub-section (1) of section 285BA of the Act for Assessment Year 2017-18 from 31st May 2017 to 30th June 2017 in case of persons throughout India who are liable to furnish the said statement.   

Sunday, 28 May 2017

Statutory Due Dates Chart

Friday, 26 May 2017

Assessees required to File Return Of Income Compulsorily u/s 139(1)

Filing Returns Of Income is Mandatory/Compulsory If -

  1. Companies and Firms (Whether having Profit Or Loss Or NIL Income).
  2. Individual, HUF, AOP, BOI and Artificial Judicial persons. 
  3. A Research Association, News Agency Or Trade Union Or Mutual Fund referred to in section 10(23D) Or Securitization Trust and Venture Capital Company/Venture Capital Fund.
  4. A Person, being a resident Other than not Ordinarily resident, having Assets(Including any Financial Interest in any Entity), located outside India Or Signing authority in any account located outside India, Whether Or not having Income Chargeable to Tax.    

Note - If whose Total Income, Before giving effect of Chapter VI A or provisions of section 10(38), Exceed the Basic Exemption Limit. Applicable in above points(2,3 & 4). 

Income Tax Due Dates

Due Date Of Filing Return Of Income -
1. 30th September of the Assessment Year, In Case of the assessee is -
    a. A Company
    b. A Person(other than comapny) whose acounts are required to be Audited
    c. A working Partner of a firm whose accounts are required to be audited
2. 31st July of the Assessment Year for Other than above or Non-Audit Assessee or any Assessee
3. Any Assessee who requied to furnish the report under section 92E, Due Date is 30th November of the Assessment Year

  

Section 285BA read with Rule 114E Of Income Tax Act,1961

From 1st April,2016, specified person is required to furnish statement of financial transaction on or before 31st May following the Financial year, In form No. 61A, the nature & value of transaction to be furnished by the reporting person under Rule 114E   

Thursday, 25 May 2017

Calculation Of House Rent Allowance (HRA) u/s 10(13A)

Method of Computation of Exemption Amount 


Ø  50%(Metro City) or 40%(Non Metro City) of Salary
Ø  Actual Rent Received
Ø  Rent Paid - 10% of Salary
(Rent Paid in excess of 10% of salary)


The Least of the above is Exempt

Salary Means - Basic Salary, Dearness Allowance(DA), Dearness Pay(DP) & Percentage Commission on Turnover

Tuesday, 23 May 2017

Model Integrated Goods & Service Tax (IGST) Law, Nov 2016

Goods & Services Tax Law Model, Nov 2016

Click here to Download Draft Goods & Services Tax Law Model

Sunday, 21 May 2017

Goods And Services Tax (Compensation to the States For Loss of Revenue) Bill, 2016

A Bill to provide for compensation to the States for loss of revenue arising on account of implementation of the goods and services tax for a period of five years as per Section 18 of The Constitution (One Hundred and First Amendment) Act, 2016.

BE it enacted by Parliament in the Sixty-seventh Year of the Republic of India as follows:—

1.           SHORT TILE AND COMMENCEMENT

(1)          This Act may be called the Goods and Services Tax (Compensation to the States for Loss of Revenue) Act, 2016.

(2)          It extends to the whole of India.

(3)          It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint in this behalf.

2.           DEFINITIONS

(1)           “base year” shall have the meaning assigned to it in section 4;

(2)           “base year revenue” shall have the meaning assigned to it in section 5;

(3)           “compensation” means an amount determined under section 7;

(4)          “earlier law” shall have the meaning assigned to it in the State Goods and Services Tax Act of the respective State;

(5)          “Council” means Goods and Services Tax Council established as per the Article 279A of the Constitution;

(6)           “Goods and Services Tax Compensation Cess” means the cess levied under section 8;

(7)          “Goods and Services Tax Compensation Fund” shall have the meaning assigned to it in section 10;

(8)          “input tax” in relation to a taxable person, means the Goods and Services Tax Compensation Cess charged on any supply of goods and/or services to him, Goods and Services Tax Compensation Cess charged on import of goods, and includes the Goods and Services Tax Compensation Cess payable on reverse charge basis;

(9)           “input tax credit” means credit of ‘input tax’ as defined in section 2(8);


(10)        “projected growth rate” means the rate of growth projected for the transition period as per section 3; 

(11)        “projected revenue” shall have the meaning assigned to it in section 6;

(12)         “State” shall include Union Territories with Legislature;

(13)        “taxable person’’ shall have the meaning as assigned to it in the Central Goods and Services Tax Act, 2016;

(14)        “taxable supply’’ means a supply of goods and/or services which is chargeable to the Goods and Services Tax Compensation Cess under this Act;

(15)        “transition date” shall mean, in respect of any State, the date on which the Goods and Services Tax Act of the concerned state comes into force;

(16)        “transition period” means a period of five years from the transition date;

(17)         words and expressions used but not defined in this Act and defined in the Central Goods and Services Tax Act, 2016 (… of 2016), shall have the meanings respectively assigned to them in that Act, in the context of GST Compensation Cess levied on taxable supplies of goods and/or services made in the course of intra-State trade or commerce; and

(18)         words and expressions used but not defined in this Act and defined in the Integrated Goods and Services Tax Act, 2016 (… of 2016) shall have the meanings respectively assigned to them in that Act, in the context of GST Compensation Cess levied on taxable supplies of goods and/or services made in the course of inter-State trade or commerce.

3.           PROJECTED GROWTH RATE

The projected nominal growth rate of revenue subsumed for a State during the transition period shall be 14% per annum.

4.           BASE YEAR

For the purpose of calculating the compensation amount payable in any financial year during the transition period, the financial year ending 31st March 2016 will be taken as the base year.

5.           BASE YEAR REVENUE

(1) Subject to the provision of sub-sections (2), (3) (4) and (5) the base year revenue for a State shall be the sum of the revenue collected by the State and local bodies during the base year, on account of the taxes levied by the respective State or Centre, net of refunds, with respect to the following taxes imposed by the respective State or Centre, which are subsumed into goods and services tax:

(a)   Value Added Tax (VAT), sales tax, purchase tax, tax collected on works contract, or any other tax levied by the concerned State under the erstwhile Entry 54 of List-II (State List) of the Seventh Schedule to the Constitution, prior to bringing into effect the provisions of the Constitution (One Hundred and First Amendment) Act, 2016;

(b)   Central Sales Tax (CST) levied by the Central Sales Tax Act, 1956;

(c)   Entry tax, octroi, local body tax or any other tax levied by the concerned State under the erstwhile Entry 52 of List-II (State List) of the Seventh Schedule to the Constitution, prior to bringing into effect the provisions of the Constitution (One Hundred and First Amendment) Act, 2016; 
(d)   Taxes on luxuries, including taxes on entertainments, amusements, betting and gambling or any other tax levied by the concerned State under the erstwhile Entry 62 of List-II (State List) of the Seventh Schedule to the Constitution, prior to bringing into effect the provisions of the Constitution (One Hundred and First Amendment) Act, 2016;

(e)   Taxes on advertisement or any other tax levied by the concerned State under the erstwhile Entry 55 of List-II (State List) of the Seventh Schedule to the Constitution, prior to bringing into effect the provisions of the Constitution (One Hundred and First Amendment) Act, 2016;

(f)    Duties of excise on medicinal and toilet preparations levied by the Union but collected and retained by the concerned State Government under the erstwhile Article 268 of the Constitution, prior to bringing into effect the provisions of the Constitution (One Hundred and First Amendment) Act, 2016; and
(g)   Any cess or surcharge levied by the State Government under any Act which is included in the definition of ‘earlier laws’ as per section 2(39) of the State Goods and Services Act of the concerned State.

(2)          The Acts of the Central and State Governments under which the specific taxes are being subsumed into the goods and services tax shall be as notified.

(3)           The revenue collected during the base year in a State, net of refunds, on account of following taxes, shall not be included in the calculation of the base year revenue for that State:
(a)   Any taxes levied under any Act made under the erstwhile Entry 54 of List-II (State List) of the Seventh Schedule to the Constitution, prior to bringing into effect the provisions of the Constitution (One Hundred and First Amendment) Act, 2016, on the sale or purchase of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas, aviation turbine fuel and alcoholic liquor for human consumption;

(b)   Any taxes levied under the Central Sales Tax Act, 1956 (74 of 1956) on the sale or purchase of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas, aviation turbine fuel and alcoholic liquor for human consumption;
(c)   Any cess imposed by the State Government on the sale or purchase of petroleum crude, high speed diesel, motor spirit (commonly known as petrol), natural gas, aviation turbine fuel and alcoholic liquor for human consumption; and
(d)   Entertainment tax levied by the State but collected by local bodies, under any Act enacted under the erstwhile Entry 62 of List-II (State List) of the Seventh Schedule to the Constitution, prior to bringing into effect the provisions of the Constitution (One Hundred and First Amendment) Act, 2016..

(4)          In respect of the State of Jammu and Kashmir, the base year revenue shall include the amount of service tax collected by the State Government.

(5)          In respect of States mentioned in article 279A(4)(g) of the Constitution, the amount of revenue foregone on account of exemptions given by the State Government to specific entities under the laws specified under sub-section (2) to promote industrial investment in the State would be included in the total base year revenue of the State, subject to the conditions as may be prescribed.

(6)          The base year revenue shall be calculated as per sub-sections (1), (2), (3), (4) and (5) on the basis of the figures of revenue collected net of refunds given in that year, as audited by the Comptroller and Auditor General of India. 

(7) In respect of any State, if any part of revenues mentioned in sub-sections (1), (2) and (3) are not credited in the Consolidated Fund of the respective State, the same shall be included in the total base year revenue of the State, subject to the conditions as may be prescribed.

6.           PROJECTED REVENUE FOR ANY YEAR

The projected revenue for any year in a State shall be calculated by applying the projected growth rate over the base year revenue of that State.

Illustration: If the base year revenue for 2015-16 for a concerned State, calculated as per section 5, is Rs. 100, then the projected revenue for, say, financial year 2018-19 shall be as follows:

7.           CALCULATION AND RELEASE OF COMPENSATION

(1) The GST compensation payable to a State shall be provisionally calculated and released at the end of every quarter, and shall be finally calculated for every financial year after the receipt of final revenue figures, as audited by the Comptroller and Auditor General of India (CAG).

Provided further that in case any excess amount has been released as GST compensation to a State in any financial year during the transition period, as per the CAG audited figures of revenue collected, the excess amount so released shall be adjusted against the GST compensation amount payable to the State in the subsequent financial year.

(2)          The total GST compensation payable for any financial year during the transition period to any State shall be calculated as follows:

(a)   The projected revenue for any financial year during the transition period, that could have accrued to a State in the absence of GST, shall be calculated as per section 6.

(b)   The actual revenue collected by a State in any financial year during the transition period would be the actual revenue from State Goods and Services Tax collected by the State, net of refunds given by the State under Chapter XI of the SGST Act, and the Integrated Goods and Services Tax apportioned to that State, as certified by the Comptroller and Auditor General of India.

(c)   Total GST compensation payable in any financial year shall be the difference between the projected revenue for any financial year and the actual revenue collected by a State as defined in sub-section (b).

(3)          The loss of revenue at the end of any quarter in any year for a State during the transition period shall be calculated at the end of every quarter as follows:

(a)   The projected revenue that could have been earned by the State in absence of GST till the end of the relevant quarter of the respective financial year would be calculated on a pro-rata basis as a percentage of the total projected revenue for any financial year during the transition period, as calculated as per section 6.

(Illustration: If the projected revenue for any year calculated as per section 6 is Rs. 100, the projected revenue that could be earned till the end of third quarter for the purpose of this sub-section shall be Rs. 75.)

(b)   The actual revenue collected by a State till the end of relevant quarter in any financial year during the transition period would be the actual revenue from State Goods and Services Tax collected by the State, net of refunds given by the State under Chapter XI of the SGST Act, including Integrated Goods and Services Tax apportioned to that State, as certified by the Principal CCA (CBEC).

(c)   The provisional GST compensation payable to any State at the end of the relevant quarter in any financial year shall be the difference between the projected revenue for till the end of the relevant period as per sub-section (3)(a) and the actual revenue collected by a State in the said period as defined in sub-section (3)(b), reduced by the provisional GST compensation paid to a State till the end of the previous quarter in the said financial year during the transition period.

(4)          In case of any difference between the final GST compensation amount payable to a State calculated as per provisions of sub-section (2) upon receipt of the audited revenue figures from the CAG, and the total provisional GST compensation amount released to a State in the said financial year as per sub-section (3), the same shall be adjusted against release of GST compensation to the State in the subsequent financial year.

(5)          Where no compensation is due to be released in any financial year, and in case any excess amount has been released to a State in the previous year, this amount shall be refunded by the State to the Central Government and such amount shall be credited to the GST Compensation Fund in a manner as may be prescribed.


Explanation.— For the purpose of this section, the actual revenue collected would include the collection on account of SGST net of refunds of SGST given by the State under Chapter XI of the concerned SGST Act, and any collection of taxes on account of the taxes levied by the respective State under the laws specified under section 5(2), net of refunds of such taxes.

8.           LEVY AND COLLECTION OF GST COMPENSATION CESS

There shall be levied and collected in accordance with the provisions of this Act, a cess to be called the GST Compensation Cess at such rate as may be notified, but not exceeding…. per cent, on the value determined under section 15 of the CGST Act, 2016, and on such supplies of goods and services, including imports of goods and services, and those supplies on which tax is payable on reverse charge basis under section 7(3) of the CGST Act, which may be prescribed on the recommendations of the Council, for the purposes of providing compensation to the States for loss of revenue arising on account of implementation of the goods and services tax for a period of five years, w.e.f. the date from which the CGST Act is brought into force.

Provided that no such cess shall be leviable under this section on supplies made by a taxable person permitted to opt for composition levy under section 8 of the CGST Act, 2016. (1)

9.           RETURNS, PAYMENTS AND REFUNDS

(1) Every taxable person registered under CGST Act, 2016, making a taxable supply of goods and/or services, shall furnish such returns in such formats, as may be prescribed, along with the returns to be filed under the Central Goods and Services Tax Act, 2016, shall pay the amount payable under the Act in the manner as may be prescribed and apply for refunds of cess paid and refundable in such form as may be prescribed.

(2) For all purposes of furnishing of returns and claiming refunds, except for the format to be filed, the provisions of the Central Goods and Tax Act, 2016, and the rules made thereafter, shall, as far as may be, apply in relation to the levy and collection of the cess leviable under section 8 on all taxable supplies of goods and/or services, as they apply in relation to the levy and collection of Central Goods and Services Tax on such supplies under the said Act or the rules made thereunder, as the case may be.

10.        CREDITING PROCEEDS OF CESS TO GST COMPENSATION FUND

(1)          The proceeds of the GST Compensation Cess leviable under section 8 shall be credited to a non-lapsable fund known as the GST Compensation Fund in the Public Account, and shall be utilized for purposes specified in section 8.

(2)          All amounts payable to the States under section 7 shall be paid from the Goods and Tax Compensation Fund.

(3)           Fifty percent of the amount remaining unutilized in the GST Compensation Fund at the end of the transition period shall be transferred to the Consolidated Fund of India, and shall be distributed between the Centre and the States and amongst the States as per provisions of clause

(2)  of article 270 of the Constitution; and the balance fifty percent shall be distributed amongst the States in the ratio of their total revenues from SGST in the last year of the transition period.

11.        OTHER PROVISIONS RELATING TO CESS

(1)          The provisions of the Central Goods and Tax Act, 2016, and the rules made thereafter, including those relating to assessment, input tax credit (subject to sub-section (3)), non-levy, short-levy, interest, appeals, offences and penalties, shall, as far as may be, apply mutatis mutandis in relation to the levy and collection of the cess leviable under section 8 on the intra-state supply of goods and services, as they apply in relation to the levy and collection of Central Goods and Services Tax on such intra-state supplies under the said Act or the rules made thereunder, as the case may be.

(2)           The provisions of the Integrated Goods and Tax Act, 2016, and the rules made thereafter, including those relating to assessment, input tax credit (subject to sub-section (3)), non-levy, short-levy, interest, appeals, offences and penalties, shall, as far as may be, apply in relation to the levy and collection of the cess leviable under section 8 on the inter-state supply of goods and services, as they apply in relation to the levy and collection of Integrated Goods and Services Tax on such inter-state supplies under the said Act or the rules made thereunder, as the case may be.

(3)           Provided further that the input tax credit in respect of GST Compensation Cess on supply of goods and services leviable under section 8, shall be utilised only towards payment of GST Compensation Cess on supply of goods and services leviable under section 8.