GST Rates Lowered!

Key Highlights of 25th GST Council Meet

The GST Council met on 18th Jan to discuss GST Returns consolidation, rate cuts and more. While a few changes were announced, the council has decided to meet again in 10 days to come to consensus on various matters. Here is a summary of the:
1. Late fee reduction:

a. GSTR-1, GSTR-5, GSTR-5A and GSTR-6 - late fee is reduced to Rs. 50 per day

b. Nil return filed for GSTR-1, GSTR-5, GSTR-5A – late fee is reduced to Rs. 20 per day

2. Cancellation of registration by voluntary registrants can be applied before expiry of 1 year from the date of registration.

3. Cancellation of registration (REG - 29) by migrated taxpayers extended till 31st March 2018

4. After successful implementation of e-Way Bills, the e-Way Bill portal to be shifted to ewaybillgst.gov.in

5. Certain modifications to e-Way Bill rules to be notified soon.

6. Recommendations made by Handicraft Committee has been accepted by the Council. The rates are to be worked out later.

7. GST rates for 29 Goods and 53 Services have been reduced. These rates are going to come into effect from 25th January 2018.
For any assistance with GST, call us on 9900397777 or write to us at info@preethamandco.com

Jack Ma Motivational Video (By: Startup Stories)

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Latest on GST

Extension of GSTR-1 due dates

Taxpayers can file GSTR-1 either monthly or quarterly.

Those with turnover of more than Rs 1.5 crore must file a monthly GSTR-1

Taxpayers of turnover up to Rs 1.5 crore can file a quarterly GSTR-1.

Every taxpayer must choose the option of monthly or quarterly on the GSTN portal. Taxpayers with turnover of less than Rs 1.5 crore may choose to file a monthly GSTR-1 if they want to.

The government has extended the due dates of filing of GSTR-1.

Quarterly filing option:

GSTR 1 for the Period	Due Date
July-September 2017	10th January 2018
October - December 2017	15th February 2018
January - March 2018	30th April 2018

Monthly filing option:

GSTR 1 for the Period	Due Date
July, August, September, October, November 2017	10th January 2018
December 2017	10th February 2018
January 2018	10th March 2018
February 2018	10th April 2018
March 2018	10th May 2018

Composition rate notified for Manufacturers

A total composition rate of 1% (0.5% SGST and 0.5% CGST) was proposed in the 23rd GST Council meeting. This rate has now been notified via Notification no 1/2018- Central Tax dated 1st January 2018.

Late Fee

GSTR-4 for composition taxpayers was due on 24th December 2017. Late fee is applicable where return has not been filed on time. The late fee for late filing of GSTR-4, where tax is due is Rs 50 per day and for nil return is Rs 20 per day

CMP-03

After opting for composition scheme, a taxpayer has to report the stock held by them on the day of opting into the scheme. The stock details have to be provided in Form GST CMP-03. The due date for filing of CMP-03 has been extended to 31st January 2018.

Important clarifications from CBEC

Here are some important aspects of GST Compliance

1.    Taxpayers have to self-calculate turnover for opting for monthly or quarterly filing

2.    Taxpayers may opt to file monthly return even where turnover is less than Rs 1.5crores if they want to. This will help their buyers reconcile their input tax credit on a monthly basis. And will be useful when GSTR-2 filing begins.

3.    Since GSTR-3B cannot be revised, errors can be revised while filing GSTR-1 and GSTR-2 of the same month.

4.    GSTR-2 and GSTR-3 will be worked out by a Committee of officers and announced at a later date.

5.    The system will then automatically reconcile GSTR-3B with Form GSTR-1 and Form GSTR-2 and discrepancies will be offset against tax payable or added to tax payable as the case may be. This will be implemented at a later date.

6.    The department has clarified common errors faced while filing GSTR-3B and the steps to be taken to resolve the same. These can be seen in detail here.

For any assistance with GST, call us on 9900397777 or write to us at info@preethamandco.com

Quick Insights to Initial Coin Offerings

What is ICO?

An Initial Coin Offering, also commonly referred to as an ICO, is a fundraising mechanism in which new projects sell their underlying crypto tokens in exchange for bitcoin and ether. It's somewhat similar to an Initial Public Offering (IPO) in which investors purchase shares of a company.

When a cryptocurrency startup firm wants to raise money through an Initial Coin Offering (ICO), it usually creates a plan on a whitepaper which states what the project is about, what need(s) the project will fulfill upon completion, how much money is needed to undertake the venture, how much of the virtual tokens the pioneers of the project will keep for themselves, what type of money is accepted, and how long the ICO campaign will run for. During the ICO campaign, enthusiasts and supporters of the firm’s initiative buy some of the distributed cryptocoins with fiat or virtual currency. These coins are referred to as tokens and are similar to shares of a company sold to investors in an Initial Public Offering (IPO) transaction. If the money raised does not meet the minimum funds required by the firm, the money is returned to the backers and the ICO is deemed to be unsuccessful. If the funds requirements are met within the specified timeframe, the money raised is used to either initiate the new scheme or to complete it.

Legality?

Legally, ICOs have existed in an extremely gray area because arguments can be made both for and against the fact that they're just new, unregulated financial assets. In some cases, the token is simply a utility token, meaning it gives the owner access to a specific protocol or network; thus it may not be classified as a financial security. On the other hand, if the token is an equity token, meaning that it's only purpose is to appreciate in value, then it looks a lot more like a security.

Source: Nasdaq, Investopedia, BitcoinMagazine

Happy New Year!

Internet of Things & Big Data

Disruptive Technologies

Internet of Things

By 2020, it is expected that 40 billion devices across the globe will be connected. The new mantra will be "Anything that can be connected will be connected".

When this happens, what will life look like?

Say, for example you have a meeting on Monday morning at 10:30 am at a downtown location. Your calendar will notify your alarm clock. Based on the past data of the time required for you to wake up and get ready, the alarm clock will automatically wake you up at 8:00 am and notify the coffee maker. Once you have picked up the coffee, it will notify the geyser. After you are ready to leave, the navigation map will guide the car by the fastest route. In case you are getting late for the meeting, the person you have to meet will be notified that you are late. At your office, your equipment will know when it is running low and will automatically re-order supplies.

IoT allows for virtually endless opportunities and connections to take place. It is almost impossible to fully understand the impact of IoT today. However, one thing is for sure -it will impact our lives in a significant manner.

Blockchain Technology 
Simply put is a huge, secure distributed ledger that can record transactions between parties in a verifiable manner. Once a record is entered, it is permanent and cannot be erased. As the records ("blocks") keep growing, its utility keeps multiplying. A blockchain database is managed autonomously using a peer-to-peer network and a distributed time stamping server. Blockchain technology has widespread applications in the field of finance -speeding and simplifying cross border payments, improving online identity management, executing commercial contracts automatically, reducing frauds, etc. As this technology proliferates and gets adopted by more people, its utility will grow dramatically.

Big Data

Big Data is large volume of data, structured and unstructured, which is difficult to process using traditional databases and software. A lot of technology investment in the corporate sector is going into Big Data computing, which reveals patterns, trends and associations. There is an enormous amount of data, which gets generated in any institution and the time is ripe to use Big Data techniques to mine this information and come up with meaningful patterns and trends.

As an example, in a firm of Chartered Accountants, Big Data can create customized reports for all the stakeholders -personalized assistance to clients, dashboards to the partners, reports to the directors and compliance charts to the regulators. The broad goals and targets of the firm can be measured and analysed periodically. Importantly, analytics of a client's historical performance can enable intervention at an early stage.

Merry Christmas!

What is a Benami Transaction?

Benami Transaction means a

1.    transaction or an arrangement—

where a property is transferred to, or is held by, a person, and the consideration for such property has been provided, or paid by, another person; and

the property is held for the immediate or future benefit, direct or indirect, of the person who has provided the consideration,

except when the property is held by—

                      i.        a Karta , or a member of a Hindu undivided family, as the case may be, and the property is held for his benefit or benefit of other members in the family and the consideration for such property has been provided or paid out of the known sources of the Hindu undivided family;

a.    a person standing in a fiduciary capacity for the benefit of another person towards whom he stands in such capacity and includes a trustee, executor, partner, director of a company, a depository or a participant as an agent of a depository under the Depositories Act, 1996 and any other person as may be notified by the Central Government for this purpose;

b.    any person being an individual in the name of his spouse or in the name of any child of such individual and the consideration for such property has been provided or paid out of the known sources of the individual;

c.     any person in the name of his brother or sister or lineal ascendant or descendant, where the names of brother or sister or lineal ascendant or descendant and the individual appear as joint-owners in any document, and the consideration for such property has been provided or paid out of the known sources of the individual; or

2.    a transaction or an arrangement in respect of a property carried out or made in a fictitious name; or

3.    a transaction or an arrangement in respect of a property where the owner of the property is not aware of, or, denies knowledge of, such ownership;

4.    a transaction or an arrangement in respect of a property where the person providing the consideration is not traceable or is fictitious;

Explanation.—For the removal of doubts, it is hereby declared that benami transaction shall not include any transaction involving the allowing of possession of any property to be taken or retained in part performance of a contract referred to in section 53A of the Transfer of Property Act, 1882, if, under any law for the time being in force,—

                  i.        consideration for such property has been provided by the person to whom possession of property has been allowed but the person who has granted possession thereof continues to hold ownership of such property;

                 ii.        Stamp Duty on such transaction or arrangement has been paid and

                iii.        The Contract has been registered.

Quick Insights to Condonation of Delay Scheme 2018

The Central Government has decided to introduce a Scheme namely “Condonation of Delay Scheme 2018” [CODS-2018] as follows.

The scheme shall come into force with effect from 01.01.2018 and shall remain in force up to 31.03.2018

Applicability

This scheme is applicable to all defaulting companies (other than the companies which have been stuck off/whose names have been removed from the register of companies under section 248(5) of the Act). A defaulting company is permitted to file its overdue documents which were due for filing till 30.06.2017 in accordance with the provisions of this Scheme.

Procedure to be followed for the purposes of the scheme:

1.    In the case of defaulting companies whose names have not been removed from register of companies:

              i.        The DINs of the disqualified directors de-activated at present shall be temporarily activated during the validity of the scheme to enable them to file the overdue documents.

             ii.        The defaulting company shall file the overdue documents in the respective prescribed eForms paying the statutory filing fee and additional fee payable as per section 403 of the Act read with Companies (Registration Offices and fee) Rules, 2014 for filing these overdue documents.

           iii.        The defaulting company after filing documents under this scheme, shall seek condonation of delay by filing form e-CODS 2018 attached to this scheme along with a fee of Rs. 30,000/- (Rs.Thirty Thousand only) as prescribed under the Companies (Registration Offices and Fee) Rules, 2014 well before the last date of the scheme.

           iv.        The DINs of the Directors associated with the defaulting companies that have not filed their overdue documents and the eform CODS, and these are not taken on record in the MCA21 registry and are still found to be disqualified on the conclusion of the scheme in terms of section 164(2)(a) r/w 167(1)(a) of the Act shall be liable to be deactivated on expiry of the scheme period.

2.    In the event of defaulting companies whose names have been removed from the register of companies under section 248 of the Act and which have filed applications for revival under section 252 of the Act up to the date of this scheme, the Director’s DIN shall be re-activated only NCLT order of revival subject to the company having filing of all overdue documents.

For Expert assistance in RoC Filing contact us at 91 9900397777 mail us at info@preethamandco.com

Restoration of Struck-Off Companies

Effect of Strike off of Companies

On dissolution u/s 248, it shall on & from date mentioned in notice of dissolution, cease to operate as company except for purpose of realizing amount due to co. & for payment or discharge of liabilities or obligations of company.

Liabilities of directors, managers, officers and members to be continue as if the company had not been dissolved.

Restoration:

On appeal by any person

Any person aggrieved by removal order may file appeal before NCLT within 3 yrs of order NCLT may pass order for restoration if it is of opinion that removal of name of co is not justified in view of absence of any of the ground on which order was passed by ROC.

NCLT to give reasonable opportunity of making representations and of being heard to ROC, company and all persons concerned.

On Application by ROC

ROC may, within a period of 3 yrs from the date of passing of the order dissolving the company u/s 248, file an application before NCLT seeking restoration of name of such company if it is satisfied that the name of the company has been struck off from the register of companies either inadvertently or on the basis of incorrect information furnished by the company or its directors.

On Application by others

An application to NCLT for restoration may be made by co., member, creditor or workmen before expiry of 20 yrs from publication in Official Gazette of notice of dissolution of the company, if:

Company was, at the time of its name being struck off, carrying on business or in operation; or
Otherwise it is just that the name of the company be restored

Quick Insights to Blockchain Technology

A blockchain is just a database for recording transactions-and the same database is copied to all the computers in a participating network. In short, blockchain is an incorruptible digital ledger of economic transactions that can be programmed to record not just financial transactions but virtually everything of value. It’s a distributed database.

Picture a spreadsheet that is duplicated thousands of times across a network of computers. Then imagine that this network is designed to regularly update this spreadsheet and you have a basic understanding of the blockchain. Information held on a blockchain exists as a shared- and continually reconciled database. This is a way of using the network that has obvious benefits. The blockchain database isn’t stored in any single location, meaning the records it keeps are truly public and easily verifiable. No centralized version of this information exists for a hacker to corrupt. Hosted by millions of computers simultaneously, its data is accessible to anyone on the internet.A blockchain is thus called to as a ‘distributed ledger’. Data in a blockchain is stored in fixed structures called ‘blocks’. The important parts of a block are:

its header, which includes metadata, such as a unique block reference number, the time the block was created and a link back to the previous block

its content, usually a validated list of digital assets and instruction statements, such as transactions made, their amounts and the addresses of the parties to those transactions.

Here's How Bitcoin Blockchain Works

“blockchain enables two entities that do not know each other to agree that something is true without the need of a third party. As opposed to writing entries into a single sheet of paper, a blockchain is a distributed database that takes a number of inputs and places them into a block. Each block is then 'chained' to the next block using a cryptographic signature. This allows blockchains to be used as a ledger which is accessible by anyone with permission to do so.  If everyone in the process is pre-selected, the ledger is termed 'permissioned'.”- Sunny Ray, Unocoin.

The USP of blockchain is that it allows two parties to execute a transaction without any intermediary. Blockchain allows financial institutions to execute and verify transactions discretely without any human intervention. The electronic ledger of transactions is continuously maintained and verified in 'blocks' of records. With the help of cryptography, the tamper-proof ledger is shared between parties on computer servers.

Source: Deloitte, Business Today, VCCircle. Compliled and presented by:  Preetham Shetty & Co. Chartered Accountants

IOTA-Thinking Beyond Blockchain Technology

How to get your Aadhaar Linked?

As per the provisions of Section 139AA of the Income-tax Act, 1961, all taxpayers having Aadhaar Number or Enrolment Number are required to link the same with PAN. The government on Friday extended the deadline for linking the same to 31^st March 2017. This is the third extension given by the government to individuals to link the PAN with the biometric ID.

Linking Aadhaar with Bank Account

Offline: Fill up the Aadhaar application form and carry it along to your bank.

Online: Can be done via net banking.

Steps to check the linking status:

1. Go to the UIDAI website.

2. Click on Check Aadhaar & Bank Account Linking Status

3. Enter your Aadhaar number and security code. An OTP will be generated and sent to your registered mobile number. Enter the OTP and login.

4. You can now see the status of your Aadhaar linking.

You can also check the status through your mobile phone. Just dial *99*99*1# > enter your Aadhaar number> confirm. You will now be able to see the status. Please note that this is only possible if your mobile number is linked to Aadhaar.

Linking Aadhaar with PAN

1. Visit Income Tax department's e-filing portal -- www.incometaxindiaefiling.gov.in.

2. Click on "Link Aadhaar" shown left hand side of the page. Key in the required details. Your PAN card is now linked to Aadhaar.

Linking Aadhaar with Mobile Number

1. Visit your nearest Aadhaar centre or download the Aadhaar update form.

2. Fill up the form with the phone number you want to link.

3. Submit the form along with photocopy of your Aadhaar and a id proof document such as PAN card, Voter ID card etc.

4. Your form submission will be verified after which you will be given an acknowledgement slip. Your phone number will be linked within 10 days.

Quick Insight to FCTRS Filing

Introduction

RBI had launched a module for reporting, under Foreign Direct Investment through eBiz portal of the Ministry of Commerce & Industry, Government of India. This has enabled the online filing of the following returns with the RBI:

Advance Remittance Form (ARF) which is used by the companies to report the FDI inflows to RBI;

FCGPR Form which a company submits to RBI for reporting the issue of eligible instruments to the overseas investor against the above mentioned FDI inflow; and

FCTRS Form which is submitted to RBI for transfer of securities between resident and person outside India.

The RBI, vide its circular no. 40/RBI, dated February 1, 2016, has issued the directions that from February 8, 2016 onwards, the physical filing of forms ARF, FCGPR and FCTRS will be discontinued and forms submitted in online mode, only through e-Biz portal, will be accepted.

FCTRS?

Foreign investors can invest in Indian companies by purchasing/acquiring existing shares from Indian shareholders or from other non-resident shareholders.

General permission has been granted to non-residents / NRIs for acquisition of shares by way of transfer in the following manner.

Transfer of shares by a Person resident outside India

Non-Resident to Non-Resident (Sale / Gift)

Note: Transfer of shares from or by erstwhile OCBs would require prior approval of the Reserve Bank of India.

NRI to NRI (Sale / Gift)

Non-Resident to Resident (Sale / Gift)

Note: Transfer of shares from a Non-Resident to Resident other than under SEBI regulations and where the FEMA pricing guidelines are not met would require the prior approval of the Reserve Bank of India.

Transfer of shares/convertible debentures from Resident to Person Resident outside India

Transfer of Shares by Resident which requires Government approval

Prior permission of the Reserve Bank in certain cases for acquisition / transfer of security

Escrow account for transfer of shares

Reporting of FDI for Transfer of shares route

1.    Form FCTRS shall be filed for transfer of capital instruments between:

A person resident outside India holding capital instruments in an Indian company on a repatriable basis and person resident outside India holding capital instruments on a non-repatriable basis; and

A person resident outside India holding capital instruments in an Indian company on a repatriable basis and a person resident in India,

2.    The onus of reporting shall be on the resident transferor/ transferee or the person resident outside India holding capital instruments on a non-repatriable basis, as the case may be.

Note: Transfer of capital instruments in accordance with these Regulations by way of sale between a person resident outside India holding capital instruments on a non-repatriable basis and person resident in India is not required to be reported in Form FC-TRS.

3.    Transfer of capital instruments on a recognised stock exchange by a person resident outside India shall be reported by such person in Form FC-TRS to the Authorised Dealer bank.

4.    Transfer of capital instruments prescribed in regulation 10(9) of FEMA 20(R), shall be reported in Form FC-TRS to the Authorised Dealer on receipt of every tranche of payment. The onus of reporting shall be on the resident transferor/ transferee. Transfer of ‘participating interest/ rights’ in oil fields shall be reported Form FC-TRS.

5.    The form FCTRS shall be filed with the Authorised Dealer bank within sixty days of transfer of capital instruments or receipt/ remittance of funds whichever is earlier.

*In terms of Section 2 (ze) of Foreign Exchange Management Act, 1999 "Transfer" includes sale, purchase, exchange, mortgage, pledge, gift, loan or any other form of transfer of right, title, possession or lien.

The content of this article is intended to provide a general guide to the subject matter. Expert advice should be sought about your specific circumstances. For assistance in filing FCTRS and FCGPR Forms and related compliances contact us at +91 9900397777 drop a mail at info@preethamandco.com.