TIOL-DDT 603 · the untouched capture
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<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#663399" size="3">TIOL-DDT
603</font><br>
30.04.2007<br>
Monday</b></font></p>
<font size="2">
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Unauthorised
Buildings - - No Service Tax? </b></font></p>
</font>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">As
per the Service Tax law,</font></p>
<p align="justify"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif">91a) “"residential complex” means any complex comprising of"<br>
<br>
(i) a building or buildings, having more than twelve residential units;<br>
<br>
(ii) a common area; and<br>
<br>
(iii) any one or more of facilities or services such as park, lift, parking
space, community hall, common water supply or effluent treatment system,<br>
<br>
located within a premises and the layout of such premises is approved by an
authority under any law for the time being in force<br>
<br>
So if the layout is not approved, you don't need to pay Service Tax?</font></p>
<font size="2">
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In Friday's <a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=5393" target="_blank">DDT</a>
we asked you this question</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>We
have a letter </b><b> with
us written by the Joint Commissioner (Tech) of the New Delhi, Service Tax
Commissionerate to the Army Headquarters which reads</b></font></p>
</font>
<p align="justify"><font color="#0000FF" size="2" face="Verdana, Arial, Helvetica, sans-serif">
<font color="#663399">In view of the Board's clarification received by this office, it is clarified
that service tax would not be leviable on construction of complexes under question
if their layout does not require approval by an authority under any law for
the time being in force.</font></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Based on this
letter, many of the contractors building flats for the Defence Ministry
are not paying service tax. Whether the Defence Ministry does not require
any permission to construct buildings is a different matter but what is
this law that exempts unauthorized builders from service tax?. And what
is the logic in this law of taxing only buildings with more than 12 residential
units? Say if an apartment complex has only 12 units each with an area of
3000 Sq. ft. and costing Rs. 3 Crores, they need not pay any service tax.
But if an apartment of poor people having 14 residential units each costing
Rs. 5 Lakhs, there is a service tax. Is it a system where the poor or taxed
and the rich are exempted?</font></p>
<font size="2"><p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#006600">Exempted
Service providers - Please Deregister yourself - Department's plea - And no
returns when you are exempted</font></b></font></p>
</font>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Once upon a time
the department went out of the way to pursue service providers to register with
the department. Now they want them out.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It seems a large
number of Show Cause Notices have been issued for non-filing of ST-3 returns
and it is observed that many of the notices are under the exemption limit of
Rs. 4 Lacs per annum. An issue was raised before the Board whether such Show
Cause Notices can be dropped. Board has clarified that a service provider who
is exempted from service tax need not file the ST-3 and therefore the Show Cause
Notices may be disposed of. Board has further asked the Directorate of Publicity
and Public Relations to carry out publicity campaign to advice the exempted
service providers to get themselves deregistered. Board also wants the DGST
to circulate these instructions to the field formations.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Directorate
of Public Relations is yet to launch the publicity campaign. Like many of Board's
important clarifications, this was also contained in a letter not released to
the public. Had they given it to us we would have certainly given it the due
publicity at no cost.</font></p>
<font size="2">
<p align="left"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=41&filename=notification/servicetax/2007/letter_comm_st.htm">Board's
Letter F.No. 137/58/2007-CX.4, Dated March 29, 2007</a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Income
Tax - TDS - How to mention acknowledgement number - CBDT clarifies</b></font></p>
</font>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In
the new forms 16 & 16A the deductor is required to quote acknowledgement
numbers in respect of all quarterly statements of TDS as provided by TIN
facilitation centre or NSDA website.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It
has been pointed out to the Board that this is an impossible situation as
far as the returns for the last quarter are concerned because the TDS certificates
in Form 16 & 16A are issued by 30th April whereas the quarterly statement
for the last quarter can be submitted before 15th of June.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Board has now clarified
that in cases where the last Quarterly Statement has not been furnished as on
the date of issuance of Form No.16 or Form No.16A and Acknowledgement No. is,
therefore, not available, the deductor may mention - 'Not Available as the last
Quarterly Statement is yet to be furnished'.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">However if the
quarterly statement has been furnished, the acknowledgement number should be
mentioned in the Form 16 and 16A.</font></p>
<font size="2">
<p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=36&filename=notification/cbdt/2006/tpl.htm">F.No.
142/44/2006-TPL, Dated April 25, 2007</a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Taxation
Laws (Amendment) Act, 2006 - CBDT Explains</b></font></p>
</font>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The CBDT has issued
a Circular explaining the salient features of the amendments, some of which
are</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Tax recovery
officer to have powers of assessing officer.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Exemption to
North Eastern Development Finance Corporation to be phased out in Assessment
year 2010-11.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Sunset clause
in Notifications removed. Exemptions given to charitable institutions by notification
are valid only for three years. Now the restriction of the three years will
be removed and the notification will be valid till withdrawn.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. Trusts, Universities
etc., to furnish audited accounts.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. Deduction to
donor if approval is withdrawn.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6. Gifts up to
Rs. 25,000 is okay but if you get a total gift of more than Rs. 50,000, the
entire amount is taxable.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7. Universities
and Colleges mandatorily to file returns.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">8. Round off to
the nearest Ten Rupees. At present the Income Tax is rounded off to the nearest
rupee; it will now be rounded off to the nearest Ten Rupees.</font></p>
<font size="2">
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/subCatDesc.php3?subCatDisp_Id=36&filename=notification/cbdt/2006/it07cir01.htm" target="_blank">CBDT
Circular No. 1/2007, Dated April 27, 2007</a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>PAN
to be the sole identification number for all transactions in the securities
market - SEBI instructions</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The Finance Minister
had in his Budget proposed to make the Permanent Account Number (PAN) to be
the sole identification number for all participants in the securities market.
The SEBI has issued instructions to the stock exchanges, depositories and intermediaries
to put this in force from the 2nd of July, 2007.</font></p>
<p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=wnew/sebi/sebi.htm">SEBI
Circular No. 05/2007, Dated April 27, 2007</a></font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>One
Commissioner doesn't constitute committee - CESTAT</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The committee of
Commissioners to review the orders of Commissioner (Appeals) consists of two
Commissioners. What happens if one of them is on leave? One bright Commissioner
signed for both. Of course the Tribunal was not impressed.</font></p>
</font>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><a href="http://www.taxindiaonline.com/RC2/inside2.php3?filename=bnews_detail.php3&newsid=5401" target="_blank">See
our Breaking News for More Details</a></font></p>
<font size="2">
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Actual
Revenue Collections exceed Target</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Finance Minister
Chidambaram announced in a press conference that the actual Revenue Collections
for 2006-07 have exceeded the Revised Estimates. The break-up of tax collection
data for the year 2006-07:</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Indirect Taxes</b></font></p>
</font>
<table width="450" border="0" cellspacing="0" cellpadding="5">
<tr>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(Rs. Cr.)</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Budget Estimates</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Revised Est.</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Actuals</font></td>
</tr>
<tr>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Total</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">229533</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">236202</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">240896</font></td>
</tr>
<tr>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Customs</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">77066</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">81800</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">86294</font></td>
</tr>
<tr>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Central Excise</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">117967</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">116233</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">117250</font></td>
</tr>
<tr>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Service Tax</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">34500</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">38169</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">37352</font></td>
</tr>
</table>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>Direct Taxes</b></font></p>
<table width="450" border="0" cellspacing="0" cellpadding="5">
<tr>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">(Rs. Cr.)</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Budget Estimates</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Revised Est.</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Actuals</font></td>
</tr>
<tr>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Total</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">210419</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">229007</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">229181</font></td>
</tr>
<tr>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Corporation
Tax</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">133010</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">146497</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">143561</font></td>
</tr>
<tr>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Personal Income
Tax*</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">77409</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">82510</font></td>
<td><font size="2" face="Verdana, Arial, Helvetica, sans-serif">85620</font></td>
</tr>
</table>
<p align="center"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><b><font color="#006600">Income
Returns - New forms for AY 2007-08</font></b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">For the assessment
year 2007-08, the Central Board of Direct Taxes have introduced the following
eight Return Forms under a new series:- </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1) <a href="http://www.taxindiaonline.com/RC2/pdfdocs/forms/itforms/itr-1.pdf" target="_blank">ITR-1</a>
- return of income for Individuals having salary and interest income and no
other income.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2) <a href="http://www.taxindiaonline.com/RC2/pdfdocs/forms/itforms/itr-2.pdf" target="_blank">ITR-2</a>
- return of income for Individuals and HUFs having income from any source except
from business or profession.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3) <a href="http://www.taxindiaonline.com/RC2/pdfdocs/forms/itforms/itr-3.pdf" target="_blank">ITR-3</a>
- return of income for Individuals and HUFs being partners in firms and not
having proprietory business or profession.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4) <a href="http://www.taxindiaonline.com/RC2/pdfdocs/forms/itforms/itr-4.pdf" target="_blank">ITR-4</a>
- return of income for Individuals and HUFs having proprietory business or profession.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5) <a href="http://www.taxindiaonline.com/RC2/pdfdocs/forms/itforms/itr-5.pdf" target="_blank">ITR-5</a>
- combined form for return of income and fringe benefits for Firms/AOP/BOI .</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">6) <a href="http://www.taxindiaonline.com/RC2/pdfdocs/forms/itforms/itr-6.pdf" target="_blank">ITR-6</a>
- combined form for return of income and fringe benefits for Companies.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">7) <a href="http://www.taxindiaonline.com/RC2/pdfdocs/forms/itforms/itr-7.pdf" target="_blank">ITR-7</a>
- combined form for return of income and fringe benefits for Charitable / religious
trusts, political parties and other non- profit organizations.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">8) <a href="http://www.taxindiaonline.com/RC2/pdfdocs/forms/itforms/itr-8.pdf" target="_blank">ITR-8</a>
- stand alone form for return of fringe benefits for persons who are not liable
to file return of income but are liable to file return of fringe benefits</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> All these Forms
(except Form ITR-7) have been designed as annexure-less so as to make them amenable
for electronic filing. The Government would urge taxpayers to use the e-filing
option, since it will help the Department to serve them better, said the Finance
Minister.</font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> Last year, electronic
filing was made compulsory for corporate tax-payers. E-filing of corporate returns
has been a resounding success. Therefore, it is important to carry forward this
successful initiative. In the Budget Speech - 2007, the Finance Minister had
announced that electronic filing of returns would be made mandatory for more
categories of taxpayers. Accordingly, for assessment year 2007-08, it would
be mandatory for firms liable to tax audit under section 44AB to file their
returns electronically. Corporate taxpayers and such firms may either file their
return electronically under digital signature or may transmit the data of the
return electronically and thereafter submit a one page verification Form which
contains a summary of the return transmitted electronically. </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> All other categories
of taxpayers (other than charitable trusts, institutions, etc.) will have the
option to file the return in a paper form or electronically, as mentioned above,
or in a bar-coded return form. </font></p>
<p align="center"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif"><b>No
cash Flow Statements</b></font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"> Last year, the
Government had introduced a cash flow statement for Individuals and HUFs. However,
responding to representations against the cash flow statement, the same has
been withdrawn. Individual and HUF taxpayers would now be required to furnish
only information with regard to transactions, which are reported through Annual
Information Returns (AIR). </font></p>
<p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Government proposes
to take the views of the Institute of Chartered Accountants of India on these
forms. In the meanwhile taxpayers have been advised to familiarize themselves
with the new forms. The notification will be made on May 14, 2007.</font></p>
<p align="justify"> </p>
<p align="justify"><font color="FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until
tomorrow with more DDT</font></p>
<p align="justify"><font color="FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Have
a nice day.</font></p>
<p align="justify"><font color="FF6666" size="2" face="Verdana, Arial, Helvetica, sans-serif">Mail
your comments to <a href="vijaywrite@taxindiaonline.com">vijaywrite@taxindiaonline.com</a></font></p>
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