Finance, Tax and Accounting

Online Filing of Excise and Service Tax Compulsory from October 1st

Sept. 23 – To establish the Goods and Services Tax (GST) in 2012-13, India’s Finance Ministry has made it compulsory for taxpayers to file their central excise and service tax returns electronically from October 1.

E-filing through the Center’s online tax compensation application ACES (Automation of Central Excise and Service Tax) will be a necessity not only for returns due after October 1, but also for returns of past periods which have not been filed yet, or are to be revised. Continue reading →

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Visit Days of NRIs to be Excluded for Finding Residential Status

Sept. 21 – Once an individual become resident in India as per the Income Tax Act, 1961 (IT Act), the individual’s international income becomes taxable. If an individual is a non-resident Indian (NRI), his/her income earned outside India is not taxable. Therefore, for a non-resident, there is always danger of taxation of global income if their stay is more than the specified numbers of days in India. Continue reading →

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ICBC Sets Up Shop in India

Sept. 20 – China’s most valuable bank – Industrial and Commercial Bank of China (ICBC) – has become the first Chinese bank to establish itself in India. The bank is planning to start with an investment of US$100 million and aims to lend to corporations and cover sectors where Chinese companies have a presence such as power, telecom and infrastructure. The bank has set up an office in the Bandra-Kurla business district in central Mumbai and has appointed Sun Xiang as CEO for India. Continue reading →

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Nasdaq to Be Listed on Bombay Stock Exchange

Sept. 19 – Just after the Indian National Stock Exchange listed the Dow Jones Industrial and S&P500 on its exchange last week, Nasdaq is to be listed on the Bombay Stock Exchange.

“We intend to offer options contracts on the Nasdaq 100. Approval from the Securities and Exchange Board of India is expected any time,” stated Ashish Chauhan, CEO of the Bombay Stock Exchange. Continue reading →

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India Simplifies Procedures for External Commercial Borrowings

Sept. 14 – The Reserve Bank of India (RBI) has eased the current modus operandi of external commercial borrowings (ECB) to relieve the flow of funds, likely benefiting ECB borrowers and lenders.

The RBI has given chosen AD Category-I banks the authority to support the request from the ECB borrowers with respect to changes in the documented lender when the original lender is an international bank or a multilateral financial institution (such as IFC, ADB, CDC), a regional financial institution, a government-owned development financial institution, an export credit agency, or a supplier of equipment and the new lender also belongs to any one of the above mentioned categories, under certain rigorous standards. Continue reading →

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Easier Norms for Overseas Nationals to Obtain Indian PAN

Sept. 13 – In an attempt to develop greater fund flows and offer some steadiness to the irregular Indian bourses, India’s Finance Ministry has tranquilized norms for foreign nationals and foreign institutional investors (FIIs) to obtain permanent account numbers (PANs) that could also double up as know-your-customer (KYC) compliance for any investment they make in Indian stocks.

Presently, FIIs or foreign citizens had to attain a PAN and separately meet KYC necessities prescribed by the market regulator before investing in stocks. The tax obligation on any transaction is twice the amount due if they don’t mention PAN details. Continue reading →

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Daily Wage Payments Cannot be Considered as Contractual Payments

Sept. 8 – Compensations made by the employer to workers employed by it on daily wage basis cannot be said to be a contractual disbursement and, as such, the assessee in such cases is not required to subtract tax from such payments u/s. 194 C of the Act.

Such payments are not in the nature of payments under agreement, but have the nature of wages. It is evident that the accountability to deduct tax under Section 194C only arises in case of contractual payments. Since the payments were made to the workers employed by the assessee on daily wages, they cannot be said to be contractual payments. Continue reading →

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CSR Contribution Based on Net Profit

Aug. 17 – India’s Ministry of Corporate Affairs stated that the Department of Public Enterprises and the Ministry of Heavy Industries and Public Enterprises have issued complete guidelines on corporate social responsibility (CSR) for central public sector enterprises (CPSEs) in April 2010.

In these guidelines, CPSEs are obligated, through a board resolution, to generate a CSR budget as a percentage of net profits from the preceding year. A CSR expenditure range of 3 percent to 5 percent is expected within the financial year if the CPSE recorded profit of less than Rs.100 crores in the previous year; 2 percent to 3 percent (subject to minimum of Rs.3 crores) if the profit ranges from Rs.100 crores to Rs.500 crores; and 0.5 percent to 2 percent if a CPSE has a net profit of more than Rs.500 crores in the previous year. Continue reading →

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