Finance (No.2) Act, 2019 with effective from 01^st November 2019 has introduced Section 269SU in the Income Tax Act, 1961 (Act) which deals with acceptance of payment through prescribed electronic modes. Vide said section, every person, carrying on business, shall provide facility for accepting payment through prescribed electronic modes, in addition to the facility for other electronic modes, of payment, if any, being provided by such person, if his total sales, turnover or gross receipts, as the case may be, in business exceeds Rs 50 Crores during the immediately preceding previous year. 

Read more: Note on Implementation of Section 269SU and Challenges thereof

By this time, I am sure that all of your mailboxes would have been flooded with colourful presentations detailing the budget proposals. Let me also add burden to your mailbox with our presentation. In this budget edition, we discuss clause by clause each significant proposal pertaining to income tax and goods and services tax laws. Hope this effort of ours is useful for understanding the proposals. Let me also allow to summarise the various proposal before going to deal clause by clause.

The significant of direct tax proposals is the relaxation of tax audits for business who are having less than turnover of INR 5 Crores subject to a condition that there cash transactions are less than 5%. This would be a great relief to the MSME sector, since, it reduces compliance cost.

Another significant of the proposal was to provide relief for companies from payment of DDT for the dividends declared. Currently, the dividends declared by the company are taxable at 15% + surcharges and cesses and exempted in hands of shareholders, except where the dividends exceed INR 10 lakhs. Now that with removal of DDT, the dividends will become taxable in the hands of shareholders and also encourage the companies to declare dividends and may lead to chance in increase in spending.

Read more: SBS Wiki Budget Special Edition 2020

In this edition, we bring you to quite a few interesting articles.

The article on “cancellation of registration under Section 12AA of Young Indian” critically analyses the  important decision delivered by Honourable ITAT Mumbai which re-emphasised the power of cancellation of registration with retrospective effect.

The article on “GST implications on development of plots” deals with liability of developer in the case of development of plots in development agreement entered with land owner, definitely would be an interesting read.

I hope that you will have good time reading this edition and please do share your feedback. I will also urge clients to mail us topics or issues on which you want us to deliberate in our future editions, so that we can contribute to the same.

Key Topics:

DIRECT TAXATION

• STORY OF YOUNG INDIAN - CANCELLATION OF SECTION 12AA REGISTRATION

GST

• GST IMPLICATIONS ON DEVELOPMENT OF PLOTS

Key Topics:

IDT

• CANCELLATION OF REGISTRATION UNDER GST

DT & ASSURANCE (TAX)

• OVERVIEW ON TAXATION ORDINANCE

DT & ASSURANCE (AUDIT)

• AS 1- DISCLOSURE OF ACCOUNTING POLICIES