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300th Issue of Tax Connect

Tax Calendar

Due date Form/Return/Challan Reporting Period Description
31st May 2021

(Extended till 30th June 2021)

ITC-04 Jan-March 2021 Due Date for furnishing Details of Job Worker
31st May 2021

(Extended till 31st July 2021)

GSTR-4 FY 2020-21 Due Date for furnishing Summary of Inward Supplies and Outward Supplies for Composite Taxpayers
31st May 2021 Form 26QB April 2021 Due Date for furnishing and making payment of TDS on Immovable property
31st May 2021 ITNS-281 March 2021 Due Date for making payment under Section 194IA/194IB/194M

Income Tax

Notification/Circular

Furnishing & Upload Of Form No. 34BB On Income Tax E-Filing Portal

OUR COMMENTS: The Ministry of Finance, Government of India, Central Board of Direct Taxes vide Notification No. 05/2021 dated 24.05.2021 has notified Procedure for the exercise of option under sub-section (1) of section 245M and intimation thereof by furnishing and upload of Form No. 34BB under sub-rule (1) of Rule 44DA of Income-tax Rules, 1962.

[For further details please refer to the notification]

CBDT Notifies Slump Sale Amendment Rules Our Comments:

The Ministry of Finance, Government of India, Central Board of Direct Taxes vide Notification No. 68/2021 dated 24.05.2021 has notified the Slump Sale Amendment Rules through Income Tax (16th Amendment) Rules, 2021. The Finance Act, 2021 brought a few significant changes to the provisions relating to slum sale under the income tax rules. Earlier, in the case of slump sale transactions, under the provisions of section 50B, the actual consideration of the slump sale transaction is respected and considered as the full value of consideration for computing capital gains. In other words, there was no need for arriving at Fair Market Value or requirement of a valuation exercise.

An amendment has been made in the Finance Act, 2021 to provide that FMV of the undertaking/division on the date of transfer (to be determined based on the rules, which may be prescribed later) as a full value of consideration. Accordingly, FMV will have to be considered irrespective of the transaction value actually received by the seller. It would be important to note that this amendment would be applicable from AY 2021-22 and hence, any slump sale transaction done during FY 2020-21 (from April 1, 2020) would be affected.

[For further details please refer to the notification]

Clarification Regarding The Limitation Time For Filing Of Appeals Before The Cit(Appeals)

OUR COMMENTS: The Ministry of Finance, Government of India, Central Board of Direct Taxes vide Circular No. 10/2021 dated 25.05.2021 has circulated that the time limit for filing of appeals before CIT(Appeals) has been extended till 31 st May 2021 including extending the time for filing the appeals before CIT(Appeals). The Central Board of Direct Taxes clarifies that if different relaxations are available to the taxpayers for particular compliance, the taxpayer is entitled to the relaxation which is more beneficial to him. Thus, for the purpose of counting the period(s) of limitation for filing of appeals before the CIT(Appeals) under the Act, the taxpayer is entitled to a relaxation which is more beneficial to him and hence the said limitation stands extended till further orders as ordered by the Hon’ble Supreme Court.

[For further details please refer to the circular]

GST

Case Laws

Sri Marg Human Resources Pvt Ltd Vs The Principal Additional Director General, Dggi, Chennai Zonal Unit, Chennai -2021 [Madras High Court]

Brief: Attachment of account under Article 19 – Challenge to attachment orders issued under Section 83 of the CGST Act pursuant to search and investigation.

OUR COMMENTS: In the present case, Petitioner submits that Section 67 of CGST cannot be against the future receivables and prays for the lifting of the impugned attachment, pending issuance of SCN and determination of tax liability. Madras High court held that attachment proceedings cannot be at the cost of the right of the provision under Article 19(1)(g) of the Constitution which provides the right to practise any profession or to carry on any occupation, trade or business. The petitioner has already discharged 27% of the proposed and estimated tax due. There is a mechanism provided under the Act for proper adjudication of the tax due and determination under Sections 73 and 74 of the Act. Therefore, there is no meaning in attaching the bank accounts any further. The respondents have commenced the investigation during October 2020. The respondents can issue a notice under Section 73 of the CGST Act, 2017 and thereafter, determine the amount due and recover the amounts. Therefore, the writ petition is allowed.

[In favour of the Petitioner]

Khalid Vs The State Of Rajasthan-2021 [Rajasthan High Court]

Brief: Seizure of goods – Demand of Tax and penalty under Section 129 – Confiscation of goods without giving fair opportunity for depositing of tax and penalty under Section 130 of the CGST Act – option to the provisional release of goods and vehicle under Rule 140(1).

OUR COMMENTS: In the present case, Rajasthan High Court held that if goods have been seized, proceedings under Section 130 of the Act can only be initiated after a fair opportunity is given to the assessee for depositing of tax or penalty as assessed. The provisions of Section 129 are independent of Section 130 and before any decision is taken under Section 130, the power is available under Section 129 to release the goods provisionally in terms of Rule 140(1) provided the owner submits the requisite as required. Since no opportunity was given to the petitioner for depositing the amount of demand of tax and penalty while issuing the impugned order, it would be in the interest of justice that the petitioner is given a chance to avail the provisional release of goods and vehicle in terms of Rule 140(1). If the petitioner fulfils the conditions as laid down under Rule 140(1) of the CGST Rules, the respondents shall release the goods provisionally subject to the final outcome of the appeal. The writ petition, as well as the stay application, stand disposed of.

[In favour of the Petitioner]

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300th Issue of Tax Connect

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