Sivakasi Branch of SIRC of ICAI

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3 CHAIRMAN S MESSAGE Dear Members, Seasons Greetings. I hope that all the members would have completed the Bank Audit to your full satisfaction. The Managing Committee was able to submit the Audited Financial Statements to our Head Office on time with the kind cooperation of our Branch Auditor, CA. G. Chandramohan. We were able to report a remarkable surplus than in previous years due to frequent public meetings on GST at Sivakasi and Rajapalayam. The visit of retired Commissioner of Income Tax Appeals, Shri S. Sankaralingam to our Branch added feather to our cap. He presented the topic Practical Approach to Income Tax Survey, Search & Appeals in an excellent manner. The Managing Committee thank all other speakers of April month, CA.N.Suresh Chander, CA.K.Chitra & CA. N. Saravanan. I thank all those members who have remitted the ARS Fees of Rs.5,900/. I request those members who have not remitted the ARS Fees to remit the same at the earliest and help the branch. C With kind regards, CA.M.Rajapandian Chairman SBSIRC 2

4 SECRETARY S MESSAGE Dear Members, Hearty Greetings to all. For the first time we are going to give Annual Audit Report on GST Returns. Hope you all exercise due care as required under GST Laws. While representing the assesses in filing their returns, I request you all to bear in mind, the insertion of new Sections 234 F and 271 J. In discharging duties, exercise Professional skepticism and stick to ethical principles. Have an ever learning year ahead With Regards,, CA.K.Giridhar Secretary SBSIRC EDITOR S MESSAGE Dear Members, I am happy to meet you once again through this newsletter. During the month of April 2018, I hope that we all had completed the statutory branch audit of banks in a successful manner. In the month of April 2018, we have coaching class for CPT June 2018 and Foundation November 2018 exam. We have conducted 3 hours and 6 hours CPE meeting in a successful manner. I appreciate the member s participation and expect the future also.we are planning to hold indoor and outdoor games and Elocution Programme for students in the month of May With Best Wishes, CA.P.Selvaraj CPE Chairman SBSIRC 3

5 PRESS RELEASE Government of India Ministry of Finance Department of Revenue Central Board of Direct Taxes New Delhi, 14th April, 2018 PRESS RELEASE Requirement for obtaining PAN card u/s 139A of IT Act, 1961 eased for corporate assessees In case of a company, an application for incorporation, allotment of Permanent Account Number (PAN) and allotment of Tax Deduction and Collection Account Number (TAN) may be made through a Common Application Form submitted to the Ministry of Corporate Affairs (MCA). In these cases, the Certificate of Incorporation (COI) issued by MCA contains a mention of both PAN and TAN. Finance Act, 2018 amended section 139A of the Incometax Act, 1961 and removed the requirement of issuing PAN in the form of a laminated card. Hence, it is clarified that PAN and TAN mentioned in the COI issued by MCA shall also be treated as sufficient proof of PAN and TAN for the said company assessees. (Surabhi Ahluwalia) Commissioner of Income Tax (Media & Technical Policy) Official Spokesperson, CBDT. 4

6 STATEMENT OF FINANCIAL TRANSACTIONS I. Introduction In order to keep a track of the high value transactions undertaken by the taxpayers, a new Form 61A under Sec 285BA was introduced w.e.f 1 st April, 2004 vide Notification No. 182/2005, dated 11/07/2005. This section required reporting persons to furnish Annual Information Return (AIR) in respect of specific financial transactions registered or recorded by them from the F.Y The Finance Act, 2014 amended Sec 285BA w.e.f. 1st April, 2015 whereby AIR had been renamed to SFT (Statement of Financial Transactions or reportable accounts). II. Basic Provisions under Income Tax Act, 1961 and Income Tax Rules, 1962 The provisions of Sec 285BA and Rule 114E are applicable to the specified transactions required to be reported. Sec 285BA read with Rule 114E of the Income Tax Rules, 1962 specifies threshold limit, relating to the reporting entities, upon which the statement of financial transaction is required to be furnished in Form No. 61A. III. Applicability The class of persons, nature and value of transactions required to be reported as per Rule 114E are given as follows 5

7 AMOUNT AGGREGATING TO: A. Banking Company or cooperative Bank TYPE OF TRANSACTION: 1. Purchase of : Bank Pay order Draft Banker s Prepaid Cheque instruments issued by RBI TYPE OF PAYMENT: Rs. 10 lakhs or more In Cash 2. Deposits in 1 or more accounts of one person (except Current account/ time deposit) B. Rs. 50 lakhs or more Banking Company/ Cooperative Bank/ Any other Company or Institution issuing Credit Card Payments received from any person (against one or more credit cards) Rs. 1 lakh or more 6 In Cash

8 Rs. 10 lakh or more C. Any other mode (except cash) Banking company/ Post Master General 1. Deposits in 1/more accounts of a person (except Current account/time deposit) Rs. 10 lakhs or more In Cash 2. 1/more Time deposits of a person (other than by way of renewal)* N.A. *Reporting person in point 2 shall include Nidhi company and NBFC as well (apart from Banking co/post Master general) 3. Deposits during 9th November, 2016 to 30th December, 2016* Rs lakhs or more (In current Account) Rs lakhs or more (other than current Account) st 4. Deposits during 1 April, Rs lakhs or 2016 to 9th November, 2016 more (i.r.o. accounts reportable (In current under 3* above) Account) Rs lakhs or more (other than current Account) D. Company/Institution issuing shares/ bonds/ debentures 7 In Cash

9 1. Amount received from a person for acquiring bonds/debentures (other than on renewal) Rs. 10 lakhs or more N.A. 2. Amount received from a person for acquiring shares (including share application money received) E. Company listed on RSE Buy Back of shares from any person (other than bought in open market) F. Rs. 10 lakhs or more N.A. Trustee/any other person managing a Mutual Fund Amount received from a person for acquiring units of 1/more schemes (other than on account of transfer from 1 scheme to another) Rs. 10 lakhs or more N.A. G. Authorised person under FEMA, 1999 Amount received from any person for sale of foreign currency (including credit to foreign exchange card/ expense in currency through debit/credit card/ traveler s cheque/draft/other instrument) Rs. 10 lakhs or more N.A. H. InspectorGeneral/ Registrar/ Subregistrar under Registration Act,

10 Purchase or Sale of immovable property I.. Rs. 10 lakhs or more (actual value) N.A. Rs. 30 lakhs or more (as per stamp duty value under Sec 50C) Any other person liable to audit under Sec 44AB (other than those mentioned above) Receipt of payment for sale of goods or services Rs. 2 lakhs or more In Cash #The threshold limit shall be applied on the aggregate of the following: 1. All accounts of same nature 2. All transactions of same nature 3. In case of joint accounts, add the amount to each account holders threshold limit 4. Limit should be applied separately to deposits and withdrawals The aggregation rule is applicable for all transaction types except: Pt. H: Purchase or sale of immovable property and Pt. I: Cash payment for goods and services. Illustrations on Aggregation rule: 1. All accounts of the same naturemr. Amar holds two savings accounts in a bank. He deposits cash of Rs 3 lakhs in one and Rs 8 lakhs in another account during a FY. By the above rule, the deposits made in both accounts which are of the same nature i.e. savings account. These have to be aggregated fordetermining the threshold of Rs 10lakhs for reporting in SFT. In this case, since the aggregate crosses the threshold of Rs 10 lakhs, the same requires reporting by the bank. 9

11 2. All the transactions of the same nature: Mr. Bheem purchases shares of aalpha Private Limited 10thApril 2016 for a value of Rs 4 lakhs. He subscribes to further shares on 1st October, 2016 for a value of Rs. 6 lakhs. By the above rule, the acquisition of shares on 10thApril and 1stOctober during the FY are transactions of the same nature, values of which have to be aggregated for determining the threshold of Rs 10 lakhs for reporting in SFT. In this case, since the aggregate equals the threshold of Rs 10 lakhs, the same requires reporting by the company issuing the shares 3. In case of joint accounts, add the amount each account holders threshold: Mr. Charu and Mr. Danish are joint account holders of 2 savings accounts with the same bank. The deposits made in both the accounts will have to be aggregated to determine the threshold of Rs. 10 lakhs for the purpose of submission of SFT. 4. Limit should be applied separately to deposits and withdrawals ABC Co. deposits Rs. 35 lakhs on 25thApril, 2016 and withdraws Rs. 20 lakhs 30thApril, According to the above rule, aggregation of deposits and withdrawals for determination of threshold of Rs. 50 lakhs cannot be done for the purpose of determining the requirement to file SFT. Therefore, presuming a scenario where the above 2 are the only deposit and withdrawal transactions by ABC Co during the year, requirement to report this in SFT would not arise. IV. Due date of furnishing SFT: Further, the statement shall be furnished on or before31stmay immediately following the financial year in which the transaction is registered or recorded. 10

12 V. Consequences of not furnishing/ filing inaccurate or defective SFT: Nonfurnishing of SFT will attract penalty under section 271FA. Sr. Particulars Penalty Period for Penalty No. 1. Failure to furnish SFT within Rs From the day immediately the period specified in notice per day following the day on which under Sec 285BA(5) of the time specified in such (i.e. within a period of 30 default notice for furnishing the days from date of service of statement expires notice) 2. Failure to furnish SFT under Rs. 500 Sec 285BA(1) per day of default *Maximum penalty has not been specified. Rectification of inaccuracy: Inaccuracy Rectification Period: discovered by: The reporting Inform inaccuracy to the prescribed income tax financial entity or authority within 10 days and furnish the correct person information The prescribed Rectifying the defect within a period of thirty days income tax from the date of intimation of such defect. authority As per section 271FAA, if inaccurate information is provided in the statement, and it is not informed to the income tax authority, the penalty leviable shall be Rs. 50,000 and the original statement shall be treated as invalid. VI. Registration Every reporting person shall obtain a registration number by communicatingthe name, designation, address and telephone number of the Designated Director and the Principal Officer to the Principal Director General of Incometax (Systems) "Designated Director" means a person designated by the reporting person and includes 11

13 Sr. No Designated Director means: For the following Reporting entities: Company Partnership Firm Proprietorship Concern Trust AOP, BOI, any other person Managing Director Managing Partner Proprietor Managing Trustee Person managing affairs of the entity VII. Contents of the Form and other details Transaction Types, reporting format and Statement type: Form 61A is divided into four parts FORM A Contains statement level information is common to all transaction types FORM B FORM C FORM D Person Based reporting Account Based Reporting Immovable Property Transaction Reporting Reporting entity is required to furnish separate Form for each transaction type. The Form Type applicable to each transaction is given below: No. SFT 001 SFT 002 SFT 003 SFT 004 SFT 005 SFT 006 SFT 007 SFT Particulars Purchase of bank drafts or pay orders in cash Purchase of pre paid instruments in cash FORM B FORM C Payment for credit card Purchase of debentures Purchase of shares Cash deposit in current account Cash deposit in account other than current account Time deposit 12

14 008 SFT 009 SFT 010 SFT 011 SFT 012 SFT 013 SFT 014 Buy back of shares Purchase of mutual fund units Purchase of foreign currency Cash payment for goods and services Cash deposits during specified period (9th Nov to 30th Dec, 2016). Purchase or sale of immovable property An illustration to explain the reporting format is as follows:: Mr. Mohan has two Credit Cards and the aggregate value of the transactions through both the cards is Rs lakhs (i.e. exceeds the threshold for reporting). This total value of Rs lakhs shall be reported in Part B4 of Form 61A. (i.e. Form Type: B, SFT: 004) The Form can be filed for either of the following statements: NB New Statement containing new information CB Correction Statement containing corrections for previously submitted information ND No Data to report VIII. Some basic login details 1. If Form61A (i.e. SFT) is filled during the previous year then, directly visit the Reporting Portal and login as follows: a. Username: PAN of Authorised Representative (as mentioned in previous return) b. Password: 13

15 (i.e. First five alphabets of PAN of Authorised Representative followed by DOB [DDMM format], say PAN: AABCD1234Z, DOB: 15/06/1997) 2. If Form 61A is going to be filed for the first time then login at Income Tax efiling website using the User Id and password of the company itself. Under My Account Reporting Portal New Registration Once the registration form is filled, it shall be processed by the department. On approval by the department, ITDREIN shall be communicated to the assesse via an , based on which Form 61A can be filed. Points to remember: 1. Due date for filing SFT for F.Y is 31st May, New Reporting Portal for SFT is in operation. 3. From 61A can be downloaded from the Utilities section under Resources in the New Reporting Portal. 4. User Manualfor filling the form and the annexure is also available under Resources section. 5. In case of SFT being applicable for the first time, ITDREIN(Income Tax Reporting Entity Identification Number) needs to generated before filing SFT. 14

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17 EXCEL TIPS CA. Dungar Chand U Jain I. Displaying Page Breaks When formatting a worksheet, we may want to see where Excel will insert page breaks in the printout. This can be done by using the Print Preview option or by using the Page Break Preview feature (Under View tab of the ribbon) Excel can display page breaks as dashed lines between rows or columns on your worksheet. You may also want to see the page breaks when you are again editing the worksheet and many a time, the feature is not enabled. In such cases to enable this display, the following steps need to be followed: 1. Display the Excel Options dialog box. (In Excel 2007 click the Office button and then click Excel Options. In Excel 2010 or later versions, display the File tab of the ribbon and then click Options.) 2. At the left side of the dialog box, click Advanced. 3. Keep scrollingdown through the list of options until you see the Display options for this worksheet section. 16

18 4. Select Check box for Show Page Breaks or ensure that the same is enabled. 5. Click on OK. II. Marking Invalid Data Data Validation feature is generally used to restrict what kind of datacan be entered into cell ranges of a worksheet, but we can use the same to mark allthe data (by circling their cells) that are outside of expected or allowableparameters. To use the Data Validation feature in this way, the following steps need to be followed : 1. Select the cell range(s) in the worksheet that need to be validated andmarked. 2. Open the Data Validation dialog box by clicking the Data Validationbutton on the Data tab of the Ribbon or by pressing Alt+AVV, andthen use its options to set up the validation criteria that determinewhich values in the selected cell range are out of bounds. 3. Choose the Circle Invalid Data option from the Data Validation button sdropdown menu on the Data tab of the Ribbon. We shall use Data Validation to markentries that are below a certain threshold. In this case, let usmark all % Share in Total TaxesDirect Taxes & % Share in Total TaxesIndirect Taxes that are above 50% by drawing a red circle aroundtheir cells. To set this up in the worksheet, we need to follow these steps: Select the cell range (H2:I15) in thedata sheet available. Open the Data Validation dialog box (Alt+AVV) and then on thesettings tab select Whole number in the Allow dropdown list and Less than in the Data dropdown list, and enter 50 in the Maximum textbox before clicking OK. 17

19 Chose the Circle Invalid Data option from the Data Validation button sdropdown menu on the Data tab. (You can also press Alt+AVI) 18

20 To remove the circles from the cells marked as invalid, choose the ClearValidation Circles option from the Data Validation button s dropdown menuor press Alt+AVR. To clear the validation settings from the cells, select therange and then open the Data Validation dialog box and click its Clear Allbutton before you click OK. 19

21 RESERVE UNIQUE NAME (RUN SERVICE BY MCA) CA. CHITRA RAGURAM RESERVE UNIQUE NAME (RUN SERVICE BY MCA) MCA has issued Companies (Incorporation) Amendment Rules, 2018, replacing the existing eform INC 1 with a new improved webbased application "RUN" "RESERVE UNIQUE NAME" Features of RUN Simple and Easy form for reserving a new name or for changing the existing name RUN being a webform, does not require DIN / DSC The feature can be availed after login into MCA portal RUN option available under Company Services in MCA Services The approved name is valid for 20 days in case of new name and 60 days for changing the existing name The fee payable is Rs. 1000/ No option of resubmission available. If the name is rejected, user has to file a new form with fee of Rs. 1,000/. Hence the user has to conduct the name [ and trade mark search [ in the links specified. An will be sent to the registered id duly conveying the approval or rejection of the name The same user login ID, which was used for reserving the name has to be used for submitting the incorporation forms. 20

22 FORM SCREEN SHOT 21

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24 EVENTS APRIL 2018 Pooja on New Financial year on 1st April 2018 Career Counselling Programme at Sivakasi ICAI Bhawan on 8th April

25 3 Hrs CPE Workshop on INCOME TAX WORKSHOP on 21st April Hrs CPE Seminar CAPACITY BUILDING MEASURES FOR PRACTITIONERS on 28th April

26 FORTHCOMING EVENTS Hrs CPE Workshop on EXCEL& CONCURRENT WORKSHOP Hrs CPE Seminar Half Yearly Games Chess & Carrom Talent Hunt Elocution & Nukkad Drama Talent Hunt Quiz & Instrumental Music 25

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