COMPLIATION OF FAQS INCOME TAX SERIES 5

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1 COMPLIATION OF FAQS INCOME TAX SERIES 5 Concept by CA. Pramod Below is a compilation of selective questions asked by different persons on and answered by various Experts empanelled thereon. The same is being shared as a knowledge sharing process for the benefit of all. Complied by Shreya 24 th July 2018 Below is the List of top 5 Experts who have answered most Queries in this category as on the date of this Compilation S. No. Name 1 CA. Pramod, Delhi 2 CA. Prakhar Bansal, Bilaspur, Chhattisgarh 3 CA. Manoj, Gurugram 4 CA. DK Bholusaria, Delhi 5 CA. Rekha Vivek Dhamankar, Pune, Maharashtra S. Query No. asked by 5.1 CA Atul Gupta 5.2 CA Monica K 5.3 Himakshi CA Student 5.4 CA Priyanka Question Answered by Answer Whether games such as Common Wealth Games or Khelo India School Games required to file ITR During survey, difference in inventory was noted. The assesse offers this difference in the return of income. My query is it to be taxed by 60% (u/s 115BBE) but does Income Tax Authority have power to reduce it below 60%? Is there any deduction available for investment in SIP mutual funds? Does an NRI require to show income that is earned in foreign country and not taxable CA Rekha They are not exempt unless specifically exempted under the Act. Commonwealth games were specifically exempted in my view If the income is assessed u/s 68 or 69, etc. Only then s. 115BBE comes into play ad 77.25%. If assessed under these sections and s. 115BBE comes into play, AO has no power to reduce the tax rates No, unless it is specifically as per ELSS allowed u/s 80C. It is not mandatory to disclose this income.

2 CA. Pramod 5.5 CA Rupesh in india in its ITR? If yes under which section and which column of ITR? "A" has given some contract work to "B". Now "A" takes some service directly from "C", which is part of the original contract with the consent of "B". "C" raises the GST bill in the name of "A", and "A" makes the payment to "C".Now "A" raises a debit note including GST to "B", and "B" debited the amount to the expenses account in his books. Who will be liable to deduct TDS, whether "A" will deduct TDS of "C" and whether "B" will also have to deduct TDS of "A"? Kindly explain. On overall bill "A" will deduct the TDS of "B". Vivek Dhamankar A will deduct the TDS of C B wont deduct tds of A A will deduct tds of B except C amount. 5.6 CA Rupesh Assessee buys two properties from same person value of which are 40 lakhs and 30 lakhs respectively. Whether TDS U/s 194IA is applicable. Since both are two different transactions, and i suppose you have different sale deeds as well. then TDS not applicable but if single sale deed than its applicable 5.7 CA Manish Whether ICDS are applicable on CA firm maintaining books of accounts on cash basis 5.8 CS Anu If a company is converted into LLP and conditions of Section 47 (xiiib) are not met and it is accordingly deemed as transfer. How should one proceed with taxation? ICDS is not applicable for entity maintaining books on Cash Basis It depends at what value the company is transferred, included deemed value u/s 50C or other similar provisions if any. Also shareholder getting reserves portion in excess of their actual cost, would be capital gains in their hands

3 CA. Pramod 5.9 CA Himansu Das 5.10 CA Darshan Galhotra 5.11 CA Deepak Malhotra Whether pension paid by bank on behalf of government and TDS deducted shall be disclosed in Tax Audit clause 34A for TDS My client running a petrol pump. IOC charging a huge amount of LFR and also charging GST. Whether we have to deduct TDS if yes then what rate. A had purchased steam coal throughout the year and there is a liability to pay Rs.400 per tonne as cess on steam coal and it is steel manufacturing unit. Now cess stands at 25 Lakhs in books and also in GSTR Portal. Now as we know that cess can be adjusted against cess liability so he wants to claim Rs 25 lakhs as expenditure in profit and loss rather than Advances in Balance sheet for FY and would reject the credit of cess in GSTR 2 as and when allowed by govt on GSTR Portal. I want to know if there is any issue. Yes, it has to be disclosed. What I understand is that The Government charges the oil distribution companies License fee, which they recover from the petrol pump dealers. On petrol, Excise and VAT would be charged and on License fee.. GST. All these seem to be part of cost of petrol product they purchase. If my understanding is correct, then no TDS would be applicable. Unclaimed indirect taxes are allowed as deduction under income tax provided it is paid on or before the due date of return of income. Any unpaid indirect taxes will be allowed as deduction in the year in which it is actually paid (Section 43B of the IT Act).

4 CA. Pramod 5.12 CA Sudhir 5.13 CA Rajesh 5.14 CA Gaurav Garg 5.15 CA Pravesh Turnover of client in FY is Rs1.50 crore, but he is opting to pay tax u/s 44AD. My query is whether he is liable to deduct tds u/s 194C as his turnover exceeds Rs1 crore as provided in clause (a) of section 44AB but provisions of section 44AB are not applicable to him due to his opting to pay tax u/s 44AD. Assessee received the prosecution notice u/s 276CC for not declaring the income and not filing the return. Now assessee request for condonation of delay under section 119(2)(b). I want to ask when we file the return under section 119(2)(b) can the interest liability on delay filing of income tax return can be waive off. If it can be waive off who has the power to waive off that liability whether commissioner or Assessing Officer. Company shifted office from Noida to Delhi. Should it apply for amendment in old TAN or surrender old TAN and apply afresh in Delhi. Is there any restriction on appointment of the wife or father of the directors in Private Limited Co. under Companies Act or Income Tax Act? CA Prakhar Bansal Yes, he is liable to deduct tax u/s 194C as his turnover in preceding year exceeded Rs. 1 Cr. Applicability of s. 44AD in this case has no relevance. Section 119(2)(a) read with Notification No.400/29/2002-IT (B), dated provides conditions and mechanism for getting the relief of interest waiver. If those conditions are satisfied, relief may be granted. You should amend the existing TAN There is no restriction as to appointment of any relative of director as the Director or Employee of the company. Though there are disclosure requirements in both Companies Act as well as Income Tax Act for transactions with or payment made to relatives of the director.

5 CA. Pramod 5.16 CA Megha Kalra 5.17 CA Rakesh Gupta 5.18 CA Sanjay Sec 115BA prescribes certain conditions that it is applicable to manufacturing concerns only. Moreover, to opt for this section, option need to be exercised by the assesse before filing of ITR. What will be the position beyond that? If deduction on bank loan interest and principal u/s 24 and 80-c available for purchase of land, if construction starts after 3 years, or accumulated interest be deductible in 05 years after construction starts? Company is selling entire one plant with all of its P&M, Land and Building and other assets. What will be tax treatment of under Income Tax and GST Laws. If the conditions u/s 115BA are not satisfied or this option is not exercised by the Assessee, corporate tax rate will continue to be 30%. For new trading companies/ service sector companies, tax rate will be 30%. 80 C allows deduction on repayment of housing loan but for that there should be a house property in existence hence till house property is not in existence 80C will not be available. 24 provides for two part, one interest accrued up to construction or possession, which should be capitalized and spread over 5 years after construction or possession another part after construction or possession, you can claim deduction on regular basis. As far as the transfer does not constitute to be a fit case for slump sale u/s 50B (which deals with transfer of entire unit/ undertaking), there will be a capital gain or capital loss on transfer of each block of assets.