FILING OF INCOME TAX RETURN AY ND JULY, 2018 BCAS LECTURE MEETING

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1 FILING OF INCOME TAX RETURN AY ND JULY, 2018 BCAS LECTURE MEETING

2 Index Sr. No Particulars 1 Who is required to file Return of Income in India? 2 Mode of Submission 3 Applicable Return of Income for various types of assessee 4 Filing Process with YOY comparison of the Income Tax Return 5 Common changes in ITR for AY A Word of Caution

3 Who is required to file the return of income in India? Particulars Assessee Type Threshold Limit Gross Total Income including Capital Gain u/s 10(38) But without claiming deduction u/s 10A,10B,10BA,80C to 80U). Mandatory to file Return of Income if there is an asset outside India or signing authority in any account outside India or financial interest in an entity outside India. Individual/HUF 2,50,000 Individual/HUF (Senior Citizens) Individual/HUF (Super Senior Citizens) Resident Individuals (Not applicable to RNORs) 3,00,000 5,00,000 -

4 Who is required to file the return of income in India? Particulars Mandatory to file Return of Income regardless of Income/Loss. Mandatory to file Return of Income if you want to carry forward loss Belated Return - Loss from House Property and Unabsorbed Depreciation allowed to be c/f Assessee Type Company/Firm Any assessee

5 Who is required to file the return of income in India? Particulars Any person deriving income from property held under trust for charitable/religious purposes without claiming exemption u/s 11/12 exceed the exemption limit If income of the political party without claiming exemption u/s 13A exceeds exemption limit If total income of the assessee specified u/s 10(21)to 10(24)(a)/(b) without claiming exemption under the sections mentioned exceeds exemption limit Any university/college/other institution u/s 35(1)(ii)/(iii) are required Business Trust u/s 139(4E) and Investment fund u/s 139(4F)

6 Who is required to file the return of income in India? Annual Information Return (AIR) of 'high value financial transactions' is required to be furnished under section 285BA of the Income-tax Act, 1961 by 'specified persons' in respect of 'specified transactions' registered or recorded by them during the financial year. What is this? What is your duty? As per the Law and Practical problems CASS/ITBA ITD Source of transactions entered by you

7 Mode of submission Person Conditions Mode of furnishing return Individual/ HUF Case I-Accounts required to be audited u/s 44AB Case 2- Return is submitted in ITR 1/ITR 4 and the individual/huf satisfies at least one of the following two conditions:- -individual is a super senior citizen - total income of the individual/huf does not exceed Rs.5 lakh and no refund is claimed in the ROI. Electronically digital return with -Electronic mode in case 3 - Paper format -Case 3-Any other case Return can be submitted by using any one of the following modes:- A. Electronically under digital signature.

8 Mode of submission Person Conditions Mode of furnishing return Individual/HUF -Case 3-Any other case B- Through electronic verification code. C. Submitting ITR V to Bengaluru Company -Case 4- Any company -Electronically with digital return Person required to furnish in ITR-7 Firm, LLP or any person (not mentioned to furnish return in ITR-5 -Case 5-Political Party -Case 6- Any other case - Case 7- Accounts are required to be audited u/s 44AB -Case 8- Any other case Electronically with digital return -Electronic mode give in Case 3 -Electronically with digital return -Electronic mode give in Case 3

9 Journey before and now. CBDT notified Income Tax Returns on 05 th April,2018. CPC released ITR 1 on and rest of the ITRs between 10 th to 26 th May. TDS Returns due date hence Form 26AS were updated only after onwards

10 ITR s notified for A.Y Applicability ITR 1 Applicability Non Applicability Individual(Not HUF), if his total income includes Salary/Pension. Income from 1 House property Income from other sources (Except income from lottery, race horses, dividend income in excess of Rs.10 lakhs or unexplained income as per Sec. 115BBE) NR/RNOR s. ROR=TIncome > 50lakhs. Income more than 1 house property or if there is b/f loss or to be c/f loss. ITR 1 will direct you to use ITR 2 anyway Agricultural Income more than Rs.5,000/- Income from any source outside India. Who wants to claim relief u/s 90/91. Who has any assets (including financial entity) located outside India.

11 ITR s notified for A.Y Applicability ITR 2 Applicability Non Applicability Individual/HUF, if his total income includes: Salary/Pension. Income/loss from more than 1 House property Income from capital gains. Income from other sources (Including income from lottery or race horses.) Income chargeable to tax under the head Profit and Gains from Business/Profession. ITR 3 Individual/HUF All incomes covered under ITR 2 & Income from Business/Profession. Any person other than Individual/HUF has no income from business/profession.

12 ITR s notified for A.Y Applicability ITR 4 Applicability Non Applicability Individual/HUF, /Firm (other than LLP) if total income includes: Presumptive Income computed u/s 44AD,44ADA and 44AE. Salary/Pension. Income from House Property Income from other sources (Except income from lottery, race horses, dividend income in excess of Rs.10 lakhs or unexplained income) Income from business/profession(includin g speculative business). Income from agency business or commission or brokerage. Income chargeable to tax under the head Capital Gains. Income from any source outside India. Who wants to claim relief u/s 90/91. Who has any assets (including financial entity) located outside India.

13 ITR s notified for A.Y Applicability ITR 4 Applicability Non Applicability Note: ITR 4 has undegone a change as per the updated utilities on CPC website w.e.f 29 th June 2018 Assessee offering Income under Sec. 44AE (say, Transport) need to give details per vehicle).

14 ITR s notified for A.Y Applicability ITR 5 Applicability Non Applicability Partnership Firm AOP/BOI For persons other than -Individuals - HUF - Company - Person filing Form ITR 7. ITR 6 Companies Companies other than those claiming exemption under section 11. ITR 7 For persons including companies required to furnish return under sections :- -139(4A),139(4B), 139(4C)139(4D),139(4E) and 139(4F)

15 ITR 1 SAHAJ- Applicable for Income from Salary,One House Property, Other Sources and Total Income upto 50 lakhs - ONLY ROR PY all Individuals, but CY only ROR Now,there is a requirement to furnish a break-up of salary i.e. Allowances not exempt, Value of perquisites, Profit in lieu of salary, Deductions u/s 16. Until now, these details would appear only in Form 16 and the requirement to disclose them in the return had never arisen. A break up of Income under House Property which was earlier mandatory only for ITR -2 and other forms. Changes in utility Deduction claimed u/s 16 cannot be more than Rs in case of assessee is not a government or a PSU employee. Intially, Rs

16 ITR 2 Applicable for Individuals and HUFs (R/RNOR/NR) not having income from profit and gains of business or profession Whatever be the residential status of an Individual/HUF, earning any source of income apart from Business or Profession, including Foreign Income/ having Foreign assets, will file ITR 2 Any Individual/HUF assessee earning income from a partnership firm, now has to file ITR-3 and not ITR -2 unlike AY

17 ITR 2 Contd Due to the fact that Income from Partnership will not have to be reported by Individuals/HUFs in ITR 2, information related to Interest held in the assets of a firm or association of persons (AOP) as a partner or member thereof in Schedule AL (Assets and Liabilities), is now removed. To clarify Schedule AL is applicable to assesses opting for ITR 2 & 3 who have total Income exceeding Rs. 50 lakhs in a PY. AS & LB not covered by BS & PL

18 ITR 3 Applicable for Individuals and HUFs having income from profit and gains of business or profession This ITR will cover any Individual/HUF whatever be the residential status, disclosing income from all sources including Income from Business and Profession. This ITR will not cover assessess offering Income on Presumptive basis like Sec 44AD, 44ADA, BUT if you are an assessee on presumptive income with Capital Gains, resort to ITR 3. Attention -Under General Information, a box for applicability of Section 115H has been inserted, which you may select for those non residents who have become residents in the financial year for which they are assessable and required to File a return u/s 139.

19 ITR 3 Contd Section 115H specifically allows for the continuation of benefit against the investment income derived from foreign exchange asset to the NRI though he becomes a resident later. After the enforcement of Goods & Services Tax, the new ITR forms have introduced new columns to report GST details (applicable also for ITR 5 and 6).

20 ITR 3 Contd. A Close look at the GST applicable field and it s impact Schedule P&L CGST, SGST, IGST & UGST received or receivable in respect of goods/services supplied (Credits) and paid/payable (debits) Schedule OI only applicable to those assessee to whom Section 44AB applies, you will need to mention the refund of GST which is not credited to P&L account. + Separate bifurcation of amounts of credit as at 31 st March of the FY for CGST, SGST, IGST & UGST.

21 ITR 4 Applicable for Presumptive Income from Business and Profession No Capital Gains - no exempt agricultural income of more than INR 5,000 No Sch. FA & FSI Income from Salaries/House Property disclosed with bifurcation as explain in ITR 1 There is an additional requirement to quote GSTR No. and turnover/gross receipts as per GST return filed Mismatch can arise while reporting gross receipts mentioned under Computation of Income under 44AD and/or 44ADA Particulars of Financial Information Mandatory fields: Creditors, inventories, debtors & cash!!!

22 ITR 4 Contd

23 ITR 6 Applicable for Companies other than companies claiming exemption under section 11 The financial statements of the company if drawn up in compliance to the Indian Accounting Standards specified in Annexure to the companies (Indian Accounting Standards)Rules,2015 Gen. Info & MAT 2 Types of BS/P&L Incase of company following Ind AS retained earnings and related groupings required to fill Other Comprehensive Income in P&L (making it 45 page long) The new ITR 6 requires every unlisted company to provide details of all beneficial owners who are holding 10% or more voting power (directly or indirectly) at any time during the year viz., the name, address, percentage of shares held and PAN. PY - only for Shareholders more than 10% voting power were required the same. Who is a Beneficial Owner

24 ITR 6 Contd Depreciation schedule has undergone a change due to changes in rates, which now allow maximum upto 40%. New columns have also been inserted to enable the entities to claim proportionate depreciation in the event of business re-organisation, i.e., demerger, amalgamation. Disallowance to be made in respect of depreciation under section 38(2) if an asset is not exclusively used for business purpose must be shown separately from AY 1819.

25 WHO IS A BENEFICIAL OWNER? Beneficial Owner refers to the person who enjoys the right of ownership of the shares irrespective of the title. He could be the person who actually enjoys the right of ownership but the name is not reflected on the register of members.

26 ITR 6 Contd.. CSR expenditures are mandatory under the Companies Act, 2013 and these are not deductible u/s 37(1). Companies covered u/s 135 of Companies Act 2013 are required to disclose CSR expenditure in its Board s report. A new column has been inserted in ITR Form 6 to provide details of apportionments made by the companies from the net profit for the CSR activities P&L of ITR and Schedule OI Following details in respect of transactions with a registered or unregistered supplier under Schedule GST: a. Transactions in exempt goods or services. b. Transactions with composite suppliers. c. Transaction with registered entities and total sum paid to them. d. Transaction with unregistered entities. (after ) Schedule FD - foreign payments/receipts towards capital and revenue nature in INR. Both GST and FD schedule mandatory for companies not liable for tax audit.

27 ITR 7 Applicable for persons including companies required to furnish return u/s 139(4A),139(4B),1394(C),139(4D)or 139(4F) Form ITR 7 require to disclose following additional information: a. Aggregate annual receipts of the projects/institutions b. Date of registration or approval granted to the trust by the IT authorityto be mentioned separately as per Notified forms, but the utility has clubbed in with details of projects run by the Trust. In case the trust has modified the Trust deed on the basis of changes in Objects/activities based on which previous registration was granted, a fresh registration shall have to be applied u/s 12A applicable for registration. a. Date of change in objects (LY) b. Whether you have complied with the time lines for fresh application?(cy) c. Whether Fresh registration has been granted u/s 12AA- procedure for registration? (CY) d. Date of such fresh registration (CY)

28 Common changes in Income Tax Return Forms not present in AY 1718 ITR Capital gains exemption u/s 54, 54B, 54EC, 54EE, 54F, 54GB and 115F shall have to be separately mentioned with different details for different exemptions. While availing exemption, mention date of transfer of original capital asset In the case of capital gain arising on transfer of unquoted shares, it would now be mandatory for the investors to obtain the valuation report. To ensure that investors correctly report the capital gains from unlisted shares, the new ITR Forms require the taxpayer to provide figures of actual sales consideration and FMV as determined by a Merchant Banker or CA. Alas! Notification 23/2018 dated 24 th May, 2018 has removed CA from valuation (applicable to all ITR except 1 & 4)

29 Common changes in Income Tax Return Forms not present in AY 1718 ITR Schedule OS to report any sum of money or any property received by any assessee which is taxable u/s 56(2)(x) crossing threshold of INR 50,000 with or without consideration from specific parties- (ITR 2, 3, 5, 6 and 7)- Eg For those claiming Treaty benefit for Capital gains, additional 5 details are required to be mentioned apart from the 5 provided in previous ITR a. Rate as per treaty b. Rate as per Income tax c. Section of the Income-tax Act d. Applicable rate Lower of both the rates

30 Common changes in Income Tax Return Forms not present in AY 1718 ITR In earlier ITR Forms, net impact of ICDS on the profit was required to be reported in Part A of Schedule OI (Other Information) but from AY 1819, increase and/or decrease both due to ICDS will need to be reported.

31 Common changes in Income Tax Return Forms not present in AY 1718 ITR Under the Schedule TDS, there is also an additional field for furnishing details of TDS as per Form 26QC for TDS on rent u/s 194IB of the IT Act,1961 along with PAN of the deductor, as TAN is not neccesary for such transactions. CBDT has changed nature of business codes for income tax return forms from A.Y Before filing of Income tax return ensure correct business sector along with correct business code has been selected.

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33 A WORD OF CAUTION TO AVOID ANY FILING ERRORS

34 THANK YOU!!! CA Divya Jokhakar Partner B.D. Jokhakar & Co. Chartered Accountants

35 LEGAL ASPECTS OF RETURN FILING AY ND July, 2018 BCAS LECTURE MEETING - C.A. Devendra H. Jain

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38 RATES OF TAXES : AY No change in basic exemption limit Tax rate for first slab upto Rs. 5 lacs reduced to 5% from 10%. Other slab rates for Individuals, HUFs, AOP, BOI, AJP remain the same. Surcharge introduced for above assessees having income above Rs. 50 lakhs but upto Rs. 1 10% (exisiting for total income above Rs. 1 crore to continue) Rebate u/s 87A restricted to Rs and for total income upto Rs. 3.5 lacs only. Companies having turnover or gross receipts upto Rs. 50 crores in FY tax rate reduced to 25%

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40 SECTION 10(38) LTCG exemption on transfer of listed equity shares would not be available if: the transaction of acquisition of equity shares is entered into on or after 1 October 2004; and such acquisition is not chargeable to securities transaction tax To protect exemption for genuine cases where the STT could not have been paid, Central Government has vide Notification No.: 43/2017 dt. 5 th June, 2017, notified certain acquisitions for which the condition of chargeability of STT shall not apply. The said notification is negatively worded and provides for cases where exemption shall be denied in the absence of payment of STT at the time of acquisition. Eg.: Cases of shares acquired in preferential allotment or shares acquired in off market transactions.

41 SECTION 10AA- CLARIFICATION Clarificatory amendment has been made that: the amount of deduction shall be allowed from the total income of the assessee before giving effect to the provisions of section 10AA; and the deduction in no case shall exceed the said total income.

42 SECTION 11 Under the existing provision, donations (except donations made out of accumulated income) by a trust or institution to any other trust or institution is considered as application of income for the purposes of its objects Proviso has been inserted that corpus donation made by a trust or institution to any other trust or institution shall not be treated as application of income

43 CHARITABLE &RELIGIOUS TRUST Exempt trust shall be required to obtain a fresh registration in case of modifications in the objects after initial registration has been granted an application to be made within 30 days of modification Additional condition has been inserted in Section 12A - of filing the return of income within the time prescribed u/s 139(1) for availing the exemptions under sections 11 and 12.

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46 SUB-SECTION 5 OF SECTION 23 A new provision has been introduced to exempt notional income from house property held as stock in trade, where the property or any part is not let out during the whole or part of the year. The said exemption will be provided only for the period upto one year from the end of the financial year in which certificate of completion of construction of the property is obtained from the competent authority.

47 SET OFF OF LOSS FROM HOUSE PROPERTY New sub-section (3A) inserted in Section 71 Restriction on set-off of loss under the head Income from House Property to Rs. 2 Lacs against income assessable from other head of income. Restriction not w.r.t Intra head adjustment Applicable to all categories of assessees Applicable even in respect of losses from LOP.

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49 CHANGES IN DEPRECIATION Any expenditure incurred on acquisition of any asset shall be ignored for the purpose of determination of actual cost if payment(s) exceeding Rs.10,000 is made in a day otherwise than by an account payee cheque/ draft or use of ECS through a bank account. Vide Notification No.: 103/2016 dated 07/11/2016, the maximum rate of depreciation, is restricted to 40% for all assessee.

50 SECTION 40A(3) & 40A(3A) Section 40A(3) amended to reduce the present threshold towards cash payments to a person in a single day to Rs.10,000 from Rs.20,000. It has also been amended to reduce the existing threshold to Rs.10,000 from Rs.20,000 for expenditure claimed in a year, but cash payments made in any subsequent year [Section 40A(3A)] Specified mode of payment expanded to include use of ECS through a bank account.

51 SECTION 43B- INTEREST TO CO-OP. BANKS any sum payable by the assessee as interest on any loan or advances from a cooperative bank( other than a primary agricultural credit society or a primary cooperative agricultural and rural development bank) shall be allowed as deduction if it is actually paid on or before the due date of furnishing the return of income of the relevant previous year.

52 MAINTAINANCE OF BOOKS & AUDIT Section 44AA - In the case of individuals and HUF carrying on business or profession (other than persons engaged in legal, medical, etc.), the threshold limits increased for maintenance of books to: income exceeding Rs. 2.5 lakhs (earlier Rs lakhs); and total sales/ turnover/ gross receipts exceeding Rs.25 lakhs (earlier Rs.10 lakhs) Section 44AB The limit of turnover/gross receipts for Eligible assessee opting for Section 44AD raised from Rs. 1 Crore to Rs. 2 Crore.

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54 Cost of acquisition of the share in the project in the hands of the land owner shall be the amount which is deemed as full value of consideration, i.e. stamp duty value. JOINT DEVELOPMENT AGREEMENT- SECTION 45(5A) Year of taxability of capital gains has been a matter of litigation in case of joint development agreements(jda) A new charging provision is introduced (ss. 5A) in case of individual or HUF entering into the JDA, capital gains would be chargeable in the previous year in which the certificate of completion is issued by the competent authority Stamp duty value of his share in the project on the date of issuance of the said certificate as increased by any monetary consideration received will be full value of consideration The above benefit would not be available if assesse transfers his share in the project on or before the date of issue of said certificate. In this case, capital gains will be taxed in the year of such transfer as per the general provisions. Further, an amendment is made towards withholding tax at the rate of 10% from the monetary consideration payable to a resident (S. 194IC)

55 CONVERSION OF PREFRENCE TO EQUITY SHARE Conversion of preference share of a company into equity share of that company will not be regarded as transfer [Sec. 47(xb)]. In determining the period of holding of such equity shares, the period of holding of the preference shares shall be included. The cost of acquisition of the preference shares would be regarded as cost of acquisition of equity shares.

56 SECTION 2(42A) & 49 Period of holding (POH) of immovable property being land or building or both, reduced from 36 months to 24 months to qualify as long term capital assets Consolidation of 'plans' within a 'scheme' of mutual fund - POH of the units of consolidated plan shall include the POH for which the units in consolidating plan of mutual fund scheme were held - Cost of acquisition of the units in the consolidated plan shall be the cost of units in consolidating plan of mutual fund scheme

57 BASE YEAR FOR INDEXATION Base year shifted from to Therefore in case of capital assets acquired before , FMV as on can be substituted for cost of acquisition. CII for : FY

58 SECTION 50CA TRANSFER OF UNQUOTED SHARES New provision in case of transfer of unquoted shares Analogous to s. 50C If consideration is less than FMV, FMV shall be taken as full value of consideration. The valuation mechanism is provided in Rule 11UAA. Rule 11UAA refers to Rule 11UA for the purpose of determination of FMV which is substituted w.e.f

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60 TAXATION OF GIFTS PROVISIONS ENLARGED Erstwhile provisions of 56(2)(vii) & 56(2)(viia) - not applicable from A.Y New clause (x) inserted in 56(2) Scope of the section widened - Recipient now to include Any Person.

61 ADDITIONAL EXCEPTIONS IN SEC. 56(2)(X) VS. 56(2)(VII) Provisions of Section 56(2)(x) shall not apply to any sum of money or any property received (VIII) from or by any trust or institution registered under Section 12A or Section 12AA (X) from an individual by a trust created or established solely for the benefit of relative of the individual.

62 SECTION -58 [IFOS-DEDUCTION] Inadmissible Deductions in computing Income from Other Sources - Section 40(a)(ia) shall also be applicable for expenses claimed under the head IFOS.

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64 REVISING ROI- 139(5) Time reduced to expiry of AY from existing period of 1 year from end of AY. Applicable from ROI for AY onwards.

65 SECTION 234F-FEE FOR DEFAULT IN FURNISHING RETURN OF INCOME (1) If a person required to furnish a return of income under section 139, fails to do so within the time prescribed in sub-section (1) of said section, he shall pay, by way of fee, a sum of, If Total Income </= Rs. 5,00,000/- Rs. 1,000/- If Total Income > Rs. 5,00,000/- & ROI furnished before 31 st December of AY If Total Income > Rs. 5,00,000/- & ROI furnished after 31 st December of AY (2) Effective for ROI of A.Y and subsequent years. (3) Consequential amendments in section 140A and 143(1). (4) Penalty provision u/s 271F removed. Rs. 5,000/- Rs. 10,000/-

66 INTEREST U/S. 234A & JUDICIAL PRONOUNCEMENT Even if ROI is filed after due date, but if SA Tax is paid before due date of return filing then Interest U/s. 234A is not leviable. - CIT v. Pranay Roy [2009] 309 ITR 231 (SC) Vide Circular No. 2/2015, CBDT had clarified that no interest u/s. 234A will be charged on the amount of SA Tax paid by assessee upto the due date of filing of return of income

67 MISCLLENEOUS AMMENDMENTS Section 115BBDA -Tax on dividend income exceeding Rs. 10 Lakhs extended to all assessees other than domestic company, trust u/s 12AA, institutions u/s 10(23C) Under section 80G, permissible donations made in cash reduced from 10,000 to 2,000. MAT and AMT credit extended to 15 years. 80CCD even non salaried person can claim deduction upto 20% of GTI (subject to overall Rs lacs) 54EC extended to cover other notified bonds.

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69 MARKED TO MARKET LOSS: New clause (xviii) has been inserted in Sub-section (1) of section 36, which provides for deduction of marked to market (MTM) loss or other expected loss as computed in accordance with the ICDS notified. Eg. As per ICDS-VI, MTM loss on derivative contract held for Hedging purpose is allowed to be recognized. Accordingly it will be allowed as deduction u/s. 36 As per newly inserted Sub-Section (13) to Section 40A, no deduction/allowance of any marked to market (MTM) loss or other expected loss shall be allowed, except for those which are allowable as per the provisions of Section 36(1)(xviii).

70 NEW SECTION- 43AA Gain or Loss due to Change in foreign exchange rate, in all kind of foreign exchange transaction To be treated as Income or Loss and accordingly to be treated in computation. However, such Gain/Loss should be in accordance with relevant ICDS (i.e. ICDS-VI) Gain or Loss shall include: (i) monetary items and non-monetary items; (ii) translation of financial statements of foreign operations; (iii) forward exchange contracts; (iv) foreign currency translation reserves.

71 NEW SECTION- 43CB Profits/Gains form construction contract or a contract for providing services shall be on the basis of percentage completion method, as specified in relevant ICDS However for, contract for providing services: - where duration is less than or equal to 90days Project completion method applicable (mandatory) - Involving indeterminate number of acts over a specific period of time Straight Line method applicable (mandatory) In following any of the above method, as applicable, - contract revenue shall include retention money and the contract costs shall not be reduced by any incidental income in the nature of interest, dividends or capital gains.

72 RETROSPECTIVE SUBSTITUTION OF SECTION 145A Valuation of Inventory: Lower of Cost or NRV, computed in accordance with ICDS. Valuation of Purchase/Sale/Inventory: Add up tax, duty, cess or fee actually paid or incurred by the assessee to bring the goods or services to the place of its location and condition. Valuation of Unlisted and/or Unquoted securities(being Inventory) : Initial cost as recognized in accordance with ICDS

73 RETROSPECTIVE SUBSTITUTION OF SECTION 145A Quoted Securities should be valued at lower of Cost or NRV. Comparison of cost and NRV shall be done category-wise. (ICDS- VIII - Valuation of Securities) Securities are classified under following categories: (a) Shares (b) Debt (c) convertible securities (d) other securities

74 RETROSPECTIVE INSERTION OF SECTION 145B Interest received by an assessee on compensation or on enhanced compensation, shall be deemed to be the income of the year in which it is received. The claim for escalation of price in a contract or export incentives shall be deemed to be the income of the previous year in which reasonable certainty of its realisation is achieved. Income referred to 2(24)(xviii) [Govt. Grant/subsidy etc.] shall be deemed to be the income of the previous year in which it is received, if not charged to income tax for any earlier previous year.

75 SECTION 80AC Earlier deduction u/s. 80IA, 80-IA, 80-IAB, 80-IB,80-IC, 80-ID, 80-IE was not allowed if the return of income is furnished after the due date specified under section 139(1) From A.Y , the scope of section 80AC is extended to provide that the benefit of deduction under the entire class of deductions under the heading C- Deductions in respect of certain incomes ( which intra-alia includes - in addition to above sections S. 80JJA, 80JJAA, 80P, 80PA, 80QQB and 80RRB) of Chapter VIA, shall not be allowed unless the return of income is filed by the due date u/s 139(1).

76 SECTION 80 IAC START-UPS Definition of eligible business altered and expanded to provide that the benefit would be available if start-up is engaged in innovation, development or improvement of products or processes or services, or a scalable business model with a high potential of employment generation or wealth creation. Benefit available to start-up incorporated on or after the 1st day of April 2019 but before the 1st day of April, 2021 Deduction available for 3 consecutive A.Y.s out of 7 years beginning from the year of incorporation of start up.

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78 MISCELLANEOUS: Section 79: If change in share holding due to proceedings under IBC, no rejection of c/f & set-off of b/f loss. Section 115BBE: Deduction/allowance/ set off will not be allowed against any addition referred to in Section 68 to Section 69D if made by Assessing officer. Section 115JB: In case of a company against whom corporate insolvency resolution process has been admitted by the adjudicating authority under IBC, Unabsorbed depreciation AND loss brought forward shall be allowed to be reduced in computing book profit.

79 MISCELLANEOUS: Section 140: In case of a company against whom corporate insolvency resolution process has been admitted by the adjudicating authority under IBC, return of income will be verified by insolvency professional appointed by such authority. Section 276CC: Proviso to this section gives relief from prosecution in case where tax payable on the total income determined on regular assessment, as reduced by the advance tax, if any, paid, and any tax deducted at source, does not exceed three thousand rupees, however now such relief shall not be available to company assessee.

80 ASSESSMENT PROCEEDINGS: Addition of difference between 26AS or Form 16/16A and ROI shall not be added during CPC processing. [143(1)]. (For returns for AY onwards)

81 ACKNOWLEDGEMENTS: VARIOUS SPEAKERS, AUTHORS & CA SHASHANK MEHTA 81

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