Terms of Reference of 7th Central Pay Commission.

Amendment to the Terms of Reference of 7th Central Pay Commission - Finance Ministry issued Gazette Notification

(Department of Expenditure)


New Delhi, the 8th September, 2015

No. 1/1/2013-E. III(A).—The Government of India have decided that the Para 5 of this Ministry’s Resolution No. 1/1/2013-E.III(A) dated 28.2.2014 shall be modified as under :—

“The Commission will make its recommendations by 31st December, 2015. It may consider, if necessary, sending reports on any of the matters as and when the recommendations are finalized.”

RATAN P. WATAL, Finance Secy.

Authority:  www.finmin.nic.in

E-book "Guidance Note on Audit of Internal Financial Controls Over Financial Reporting" Free Download

Recently, The Pulication Department on behalf of the Institute of Chartered Accounts of India has been published a book  on "Guidance Note on Audit of Internal Financial Controls Over Financial Reporting" which helps us to auditing.

Download e-Book (Click Here)

Important Guidelines for payment towards liability on account of Tax Deducted / Collected at Source

Important Guidelines for payment towards liability on account of Tax Deducted / Collected at Source

Your attention is drawn towards some relevant guidelines related to payment of TDS/ TCS liability.

A. Central Government Account ( Receipts and Payments ) Rules, 1983:

Date of Receipt for Cheques or Drafts: The Central Government Account (Receipts and Payments) Rules, 1983 contain, inter alia, regulate public moneys received by or on behalf of the Government of India. As per clause 20 of Part I (Preliminary and General Principles), the Date of receipt of Government revenues, dues etc. is determined as follows:

20. Date of receipt of Government revenues, dues etc.-
Government dues tendered in the form of a cheque or draft which is accepted under the provisions of rule 19 and is honoured on presentation, shall be deemed to have been paid-

i. where the cheque or draft is tendered to the bank, on the date on which it was cleared and entered in the receipt scroll;

B. Rule 125 of Income Tax Rules, 1962:

Electronic Payment of Tax: Rule 125 of Income Tax Rules, 1962 relates to Electronic Payment of Tax. The relevant provisions are as under:

    The following persons shall pay tax electronically on or after the 1st day of April, 2008:
          a company; and
          a person (other than a company), to whom the provisions of section 44AB are applicable.

    For the purposes of this rule :
        "pay tax electronically" shall mean, payment of tax by way of-
        internet banking facility of the authority bank; or

In the light of the above, it is suggested that the payments towards TDS may kindly be made through e-payment mode. This helps in better reporting of challan by deductors and consequential matching of such challans.

It shall help the deductors in reduction of late payment interest that may arise due to delay in date of tendering of cheques and date of credit to the Government account.

CPC (TDS) is committed to provide best possible services to you.

How to tackle with Income Tax Notices ?

Many of my family members & friends are receiving notices from Income tax department; usually any communication from the Income Tax department, especially receiving a notice from them, can send shivers down anyone's spine. A majority of the notices is sent in the normal course of processing returns& might be for routine enquiry or a request for simple clarification, so don’t be panic.

What to do when you receive an Income Tax notice?

  1. Don’t Ignore: Handle the situation carefully and sincerely, or you may end up paying a penalty of up to Rs 10,000 along with the tax payment.
  2. Back to basics: Check the whether the notice is really meant for you by checking basic things like PAN, Name, Assessment year it related to issuing officer, signature, address with details of ward and circle number. Verify these details to avoid being cheated. To see details go to E filling website see know your AO
  3. Preserve the envelope: If the notice comes by snail mail, preserve the envelope. It serves as proof of the dates on which it was posted and received.
  4. DIN: If the notice is delivered online, then check the Document Identification Number.
  5. Identify the reason behind the notice: By normal reading one can easily indentifies the reason behind notice. Reasons could be a simple mismatch in TDS or inconsistency in your returns, or some serious concerns like income concealment. It can also be a survey or scrutiny of accounts.
  6. Validity: Check the validity of the notice and the timely issuance. Also check the section under which the notice has been issued. For example: A notice under Section 143(3) for scrutiny assessment has to be served within six months of the end of the financial year in which the return was filed. If served later than this period, it will be considered invalid.
  7. Gather the documents: Start collecting the documents that the department has requested via the notice. Documents needed can vary depending on the gravity of the notice, usually scrutiny notice may ask for several documents, including bank statements, pay-slips, rent receipts and brokerage statements. While it may not be possible to put all this together in the short time.
  8. Letter: Prepare a covering letter along with the set of documents.
  9. Acknowledgement: Prepare two set of all the documents required, along with a copy of the covering letter. Get your copy stamped to maintain personal records, and as a proof of submission of the documents thereby complying with the notice.
  10. Reply on time: Always respond to the notice on time even if you are unable to collect the required documents. You can even ask for some time to gather all the documents. Timely response will help establish that you are honest, and cooperating with the law.
  11. CA help : If the notice is simply about a factual matter, such as an arithmetical error, TDS mismatch or deduction amount, a taxpayer should respond on his own, Only when it is a serious issue, such as a notice for scrutiny or reassessment under Section 148, should one get a professional to respond. But A chartered accountant will be better equipped to deal with the situation and provide apt responses.
Interpreting notices under different sections of income tax for individuals
Sec 131(1A): Assessing officer has reason to suspect that income has been concealed.
  • Enforcing the attendance of any person, including any officers of a banking company and examining him on oath and completing the production of books of accounts and documents.
  • Failure to comply with the summons issued under Section 131(1) has been made punishable with a penalty of Rs 10,000 for each default under Section 272A.
Sec 133(A) : For survey or scrutiny of accounts
Sec 139(9) : For filing defective return
Sec 142    : For not filing the income tax return or for the scrutiny of a documents & accounts in support of the return filed by the tax payer
Sec 143(1) : For adjustment or additional tax demand if an error or incorrect information is detected in the return filed by the tax payer.
Sec 143(2) : For scrutiny assesement after detailed inquiry by assessing officer
Sec 148    : For reassessment if the officer believes some income has escaped assessment.
Sec 156    : For dues(tax, interest,penalty,fine or any other sum) payable by the assessee)
Sec 245    : For adjustment of refund with any demand due

Reasons behind getting Notice :
Return not filed or delayed: Employer deducted tax from you salary. However, Employee did not file the return. In such a case, the tax department will send a notice asking employee to file the return. The notice has to be responded to within the given time. Otherwise, employee may be penalized. Such a notice can be sent for any of the previous six assessment years. In case of delayed filing, the department can levy a penalty of Rs 5,000 a year. However, the penalty is not mandatory, and depends upon the discretion of the assessing officer. However, if any tax is due, the department charges 1% interest per month from the due date.

Mismatch in tax credit: Tax deducted at source, or TDS, figure in your Form 16 may be different from the actual tax credit mentioned in Form 26 AS, a document issued by the income tax department that has all your tax-related information such as tax deducted, refund, etc, against your permanent account number (PAN). In case there is mismatch between the two, the department goes by the figure in Form 26 AS.

The mismatch could be because either the employer has not deposited the tax deducted from your salary with the department or has credited it in someone else's account. In such a case, you have to file a rectified return.

If the employer has not paid the TDS to the tax department, point this out to him. In case the tax has being credited to someone else's account, furnish the TDS certificate to the assessing officer for making the necessary changes.

Investments in the name of spouse
Many individuals resort to purchasing assets in the name of their spouse, children or other close family members in the hope of evading taxes. Assets in this case refer to any kind of investment like land, buildings, fixed deposits, mutual funds, shares, debentures etc.

Let's say x bought mutual funds in your wife¡¦s name. As per section 64 of the Income Tax Act, any income x generate out of these mutual funds is still considered x income and x will be taxed for it.

You need to ensure that you declare such income at the time of filing your return, else you will attract attention from the taxman and receive a notice for the same.

High Value Transactions
High value transactions need to be updated to the Income Tax department by the entity with which you carry out such a transaction. This is in order to ensure taxes are levied as required on each of these transactions in a timely manner. Failure to do so is an invitation for a tax notice.

What qualifies as a high value transaction?
  • Cash deposits in a bank worth Rs 10 lakh or more in a year
  • Credit card purchases of Rs 2 lakh or more
  • Mutual fund investments for Rs 2 lakh or more
  • Purchase of bonds and debentures worth Rs 5 lakh or more in a year
  • Sale or purchase of property worth Rs 30 lakh or more
Non-disclosure of assets for wealth tax
If you own assets whose net value is over Rs.30 Lakhs, you are liable to pay wealth tax at the rate of 1% of the amount that is above the Rs.30 Lakhs limit. If you do disclose such assets that you own or do not pay taxes on them, there is a good chance that you might receive an IT notice.

Assets can include anything from land, second homes, cars, yachts, gold jewellery, antiques, art etc. If you are unsure about the exact value of the assets you own, you can approach government approved valuers for this purpose.

Random Scrutiny
To enforce tax compliance, the IT department has started randomly scrutinizing returns under section 143 (3). If you receive such a scrutiny notice, don¡¦t panic. Just follow these simple steps:
  1. Check the validity of the notice as well as the duration within which you have to respond to the Assessing Officer. Usually, a scrutiny notice is served to the assessee within a period of 6 months from the end of the financial year. Very rarely, notices related to older cases are also sent under section 148, if the Assessing Officer finds genuine reason to do so.
  2. Make multiple copies of the notice received
  3. Submit documents requested along with a cover letter listing all the documents to the Assessing Officer
  4. Request for an acknowledged copy of the cover letter from the Assessing Officer for your own records
  5. If the notice is regarding your old dues, they can be adjusted against any pending refund claims made by you for a current year.
What Should One do in a Scrutiny Proceeding ?
When you receive notice from Income tax department , Do this things
  1. Ensure that all related documents to the assessment proceeding with you.Ex Form 16, 26AS, Previous year ITRs, Proofs for deductions, Wealth tax file, bank accounts, etc… details regarding all monetary transaction
  2. For salaried person, keep your Form 16 issued by your employer.
  3. All your bank statements .
  4. Reasons for high amount transactions.
  5. Documents, details asked in notice.
  6. If you have received any loan or gift, get a certificate from such person with his complete address on the loan certificate.
  7. On hearing date ,you must appear either yourself or through any Chartered Accountant or tax practitioner before the Assessing Officer on the date of hearing.
  8. Keep calm & argue politely with A.O. by quoting relevant sections
  9. Take acknowledgment for copies submitted
  10. Write down relevant points.

One Rank One Pension from 7th Pay Commission - NC JMC Demands

Com. Shiva Gopal Mishra secy. staff side/NCJCM has written a DO letter to chairman 7th Pay commission for pension Parity between past and future pensioners.

Shiva Gopal Mishra

Ph: 23382286
National Council (Staff Side)
Joint Consultative Machinery
13-C, Ferozshah Road, New Delhi – 110001
E-Mail: nc.jcm.ni@gmail.com
Dated 11.09.2015
Justice Shri Ashok Kumar Mathur,
Seventh Central Pay Commission,
New Delhi.

Dear Sir,

Sub: Parity between Past and Future Pensioners

While urging for parity in Pension; for past and future pensioners before the Seventh Central Pay Commission, Staff Side, National Council/JCM vide Chapter-IV, Para 4.1 submitted as follow:-

“The Government have recently announced that “One Pension’ shall be implemented in respect of Armed Forces so that the glaring disparity between the persons of equivalent rank and status do not draw vastly unequal pensions if they retire at different point of time is undone. Already there is a complete parity in pension among the Judges of Supreme Court, High Court and the Comptroller and Auditor General of India, irrespective of the date of their retirement”. Now the Government of India has accepted the demand for ‘One Rank One Pension’ in respect of Armed forces.

The detailed justification for the same has already been submitted in our aforesaid Memorandum, as well as during our Oral Evidence before the Central Pay Commission.

The Civilian employees of Central Government have been waiting anxiously for implementation of the same equally for them and hope that the Seventh Central Pay Commission would administer Justice by recommending “One Rank One Pension’ to all other past and future pensioners irrespective of their date of retirement and remove the injustice done to them so long.

Yours faithfully,

(Shiva Gopal Mishra)

Source: NCJCM Staff Side

The basics of annual tax filing for startups – due dates and more

If you are a business owner, September 30 and October 30 are two important dates for you.  September 30 is the due date for filing the Income Tax Return for your company, whereas  October 30 is the due date for filing the annual financial statements with the Registrar of Companies (RoC). They are more crucial if you are a VC/Angel funded startup or looking for such third party investment. A zero non-compliance business environment is the pre-requisite for this.

In the fervour of starting a new business, it’s easy to overlook the long-term impact of a sustainable regulatory decision that extends to recording the initial transactions, filing your tax return and other mandates. In the rush to go to market, it’s easy to think the business model itself will carry the day. Two out of three startups die out in their first three years of operation. While the reason may not be related to tax and regulatory non-compliances, this builds on the cause.

Most startups think that since they have no business transactions or they have incurred losses, they do not need to file their taxes. The reality, however, is every company/Limited Liability Partnership (LLP) has to comply with five basic compliances irrespective of its business situation. They are detailed below:

1.    Accounting and Book Keeping
Recording the transactions and preserving bills and invoices to back financial statements is something that most business owners dread. Avoiding this leads to serious repercussions. For example, at the time of incorporation, a company pays the registration fees, name approval fees and stamp duty to RoC. Further, the promoters of the company also hire a professional firm to guide them through the entire incorporation procedure, which again involves cash outflow.

These expenditures, though pre-incorporation in nature, provides tax-saving benefits to the company, to the extent of one-fifth of such expenses every year. Further, invoices carrying break-ups of VAT and service tax is a boon, as far as claiming credit for both is concerned. The company should keep records of all expenses made specifically for business, since these are deductible against business revenues. Even if the company is suffering losses, it is advisable to maintain records in order to raise the losses and set it off with future profits.
Penalty for Non-Compliance:

In case of non-compliance, persons responsible shall, in respect of each offence, be punishable with imprisonment for a term which may extend to one year or with fine which shall not be less than Rs. 50,000 but which may extend to Rs. 5,00,000 or both in case of companies.

2.    Income Tax Return Filing
Filing of income tax return is the most authentic proof of the income earned as all are required to file it.  But many do not file tax returns as they are unaware of the procedure. Startups should appoint a tax consultant who will help them avail the benefits of filing tax return in time. Some of the benefits include:
  • Filing timely returns saves one from the assessments of income by the income tax officials.
  • A business having losses can carry it forward and get it set-off with future profits.
  • For making an investment, filing income tax return on time is essential.
  • Tax refunds can be claimed only when income tax return is filed.
The due date for filing this return is September 30 each year. However, if transfer pricing provisions are applicable for your business, this due date changes to November 30 each year.
Penalty for Non-Compliance:

Late filing of return will attract interest u/s 234A i.e. if the assessee fails to file income tax return within the time prescribed by Section 139, he shall be liable to pay interest at one per cent per month or part of the month from the due date of filing of return to the actual date of filing of its return. A further penalty can be levied up to Rs. 5,000 for non-filing of tax returns us 271F.

However, for the purpose of filing income tax filings, the year has to close on March 31 each year. For that purpose, you only need to file a simple format of Profit and Loss Account and Balance Sheet with the department and then prepare the return and file it within the prescribed due date.

3.    Statutory Audit Compliances
Companies are mandatorily required to get their accounts audited annually whereas only those LLPs having a turnover of more than Rs 40 lakh or Rs 25 lakh contribution in any financial year are required to get their accounts audited annually as per the LLP Act.

The LLP Act provides that the partners of such LLP if decided not to get audit of the accounts of the LLP then such LLP shall include in the Statement of Account and Solvency a statement by the partners to the effect that the partners acknowledge their responsibilities for complying with the requirements of the Act and the Rules with respect to preparation of books of account and a certificate in the Form 8. However no such relaxation is provided to companies.

4.    ROC Compliances
Every company (having or not having share capital) and LLP has to file its financial reports with the Ministry of Corporate Affairs annually. It constitutes a component of ‘Annual RoC Filing’ mandated by Companies Act, 2013. As a part of annual filing, Companies incorporated under the Companies Act 2013, are required to file the following e-forms with the RoC:

Penal Provisions:

The penal provisions of RoC are so stringent that companies have been shut down due to this. The additional fees can be as high as upto 12 times of normal fees. Further, there also provisions where huge penalties are laid per day on officers as well as the companies simultaneously. Companies Act 2013 also has provisions of hard crust penalties like imprisonment of company directors on grounds of severe non-compliance.

As a part of Annual Filing, LLPs are required to file the following e-forms with the RoC:

Penal Provisions for Limited Liability Companies –
Surprisingly, there are no slabs for late filing fee for LLPs. In this regard, the straight rule of computation of late filing fee is Rs 100 per day of delay in filing. The number of days of delay in filing is calculated from the due date of filing to the actual filing date.

As mentioned earlier, these compliances have to be adhered to irrespective of your business situation. Non-compliance of these provisions has the capacity to shut down a full-fledged business. If you still have not started working on this, we suggest you buck up. You still have 21 days at hand!

Source: Yourstory.com

No Extension of Date for Filing of Returns due by 30th Sept for Asstt.Year 2015-16

No Extension of Date for Filing of Returns due by 30th September for Assessment Year 2015-16 for Certain Categories of Assessees Including Companies, and Firms and, Individuals Engaged in Proprietary Business/Profession etc whose Accounts are required to be Audited; Taxpayers are Advised to file their Returns Well in Time to Avoid Last Minute Rush.

Income-tax returns for Assessment Year 2015-16 for certain categories of assessees viz companies, firms and individuals engaged in proprietary business/profession etc whose accounts are required to be audited, are to be filed by 30th September, 2015. The audit report is also required to be filed by the said date.

The Government has received representations from various stakeholders seeking extension of date for filing of returns and tax audit reports beyond 30th September 2015. The reasons cited are delay in notifying the returns and related delay in availability of forms on the e-filing website.

The matter has been considered. Income-Tax Returns Forms 3,4,5,6 and 7 which are used by the above mentioned categories of assessees were notified for Assessment Year 2015-16 on 29.07.2015. The forms were e-enabled and were available on the e-filing website of the Department from 7th August 2015 giving enough time for compliance. The changes made to these forms are not extensive as compared to the earlier years. Further taxpayers entering into either international transactions or specified domestic transactions are required to file their returns by 30th November 2015 only.

After consideration of all facts, it has been decided that the last date for filing of returns due by 30th September 2015 will not be extended. Taxpayers are advised to file their returns well in time to avoid last minute rush.

Extension of time for filing of cost audit report For Fin. Year 2014-15.

MCA Circular regarding Extension of time for filing of cost audit report to the Central Government for the Financial Year 2014-2015 in form CRA-4

General Circular No.12/2015
Government of India
Ministry of Corporate Affairs

5th Floor, 'A' wing, Shastri Bhawan,
New Delhi: 110001.

Dated: 1st September, 2015

All Regional Directors,
All Registrar of Companies,
All Stakeholders.

Subject: Extension of time for filing of cost audit report to the Central Government for the Financial Year 2014-2015 in form CRA-4 - reg.


In continuation to General Circular No.08/2015 dated 12.06.2015. the last date of filing of Form CRA-4 wihout any penalty/late fee is hereby extended upto 30th September, 2015.

2. This isssues with the approval of competent authority.

Yours faithfully.
Assistant Director
Tel No.23387263

Copy to: File No.1/40/2013/CL-V

119% D.A. from July 2015 - Cabinet Committee may approve tomorrow.

119% D.A. from July 2015

With the reliable source of media, the Cabinet committee in its meeting tomorrow is likely to approve an additional Dearness Allowance for Central Government employees due from July 2015.

This is the second installment of this year, from July to December 2015, an additional Dearness Allowance may be hiked by 6% as per the calculations recommended by 6th CPC. Now the Central Government employees and pensioners are getting 113% DA and DR, after the declaration by the Cabinet Committee. With the announcement of All India Consumer Price Index for the month of June, 2015, the average stood at 254.41. Hence the Central Government Employees are entitled for D.A. at 119% of pay w.e.f.01/07/2015.