Hi Folks

In a yesteryear Bollywood hit, the hero crooned to the heroine “yeh uthe subah chale, yeh jhuke shaam dhale” romanticising the lifting up and down of her beautiful eyes to the breaking of dawn and setting of dusk… reminds me of 2015 which seemed to have gone by in the batting of an eyelid !!

I know today is 31st Dec
I know today is the last day of 2015

I know yet another day is coming to an end

I know tomorrow is the dawn of a new day, a new year of hopes

I know except the teens rest of us would prefer to forget our age

I know it is not the years that add to life but the life that adds to years

I know I can claim many ‘I knows’ and you ‘many more knows’

But I also know there is little mind space and inbox space as New year Wishes flood you

So, I shall KISS… Keep It Short & Simple



Back to some Lexspeak stuff…I could lay my hands on Karnataka Start Up Policy. Click to read, once the New Year revelry is over. Afterall 2016 promises to be yet another Start Up New Year. The last issue of Lexspeak for 2015 carries about 10-12 news items including a POEM.. scroll down, nothing romantic about it though, coming as it is from the Income Tax dept. ! Should you wish to refer to any of our older issues of Lexspeak, do visit our Resource Centre at sharadasc.com.

Warm regards

Quoting of PAN for transactions exceeding Rs.2 Lac regardless of the mode of payment w.e.f. 1st Jan 2016.
Limits raised for other types of transactions requiring PAN:

  • from Rs.5 Lac to Rs.10 Lac for sale / purchase of immovable property
  • from Rs 25,000 to Rs 50,000 in the case of hotel or restaurant bills paid at any one time
  • from Rs.50,000 to Rs.1 Lac in case of purchase / sale of shares of an unlisted company
CBDT has formulated draft guiding principles for determination of the Place of Effective Management (POEM) of a company for the benefit of taxpayers as well as the tax administration.

Determination of POEM would be a 2 stage process, namely:-

  • identification or ascertaining the person or persons who actually make the key management and commercial decision for conduct of the company’s business as a whole.
  • determination of place where these decisions are in fact being made.
CBDT has relaxed conditions for furnishing the information w.r.t payments to non-resident not being a company or to a foreign company in Form 15CA.

  • An Individual is not required to furnish information in Form 15CA and 15CB for remittance which requires no RBI approval.
  • CA certificate in Form No. 15CB will only be required for payments made to non-residents which are taxable and the payment exceeds Rs. 5 lakh.

CBDT has simplified the procedure for Form No.15G and 15H relating to TDS on income from interest on securities or dividend or interest other than interest on securities. 15G & 15H can be provided in electronic form to the payer who shall consolidate all such electronic declaration and upload in the TDS quarterly status.
It is clarified that employer’s contribution to funds for the welfare of employees (PF, gratuity, superannuation etc.) in terms of section 43B(b) of the Income Tax Act, shall be allowed as a deduction to the employer assessee if he deposits the contribution to welfare funds on or before the ‘due date’ of filing of income tax return.

The CBDT has revised the minimum monetary limits for filing of appeals / SLP by the Department before the Income Tax Appellate Tribunal (ITAT) / High Courts (HC) & Supreme Court (SC) as a measure to reduce litigation.
Before Appellate Tribunal Rs.10,00,000
Before High Court Rs. 20,00,000
Before Supreme Court Rs. 25,00,000
Auditors (Statutory, Cost and Secretarial) are now required to report any suspected corporate fraud amounting to Rs 1 crore or more to the Central Government along with the reply of the Board or Audit Committee of the company. Frauds of a lower amount shall be reported to the Board or Audit Committee.

Earlier, threshold was not specified. Such frauds must be reported in Board’s Report as well.

MCA has allowed ‘omnibus approval’ of related party transactions by companies’ audit committees in order to improve the ease of doing business for corporates.

  • Audit Committee may make omnibus approval for proposed related party transactions subject to certain criteria laid down in the (Meetings of Board and its Powers) Second Amendment Rules, 2015.
  • Where the need for related party transactions cannot be foreseen, the audit committee can allow omnibus approval provided that value of each transaction does not exceed Rs 1 crore.
  • Such approval will be valid for a period of 1 financial year and will need fresh approval after the expiry of the financial year.
RBI has reviewed the framework of External Commercial Borrowings (ECB) Policy which will comprise the following 3 tracks:

Track I: Medium term foreign currency denominated ECB with Minimum Average Maturity (MAM) of 3/5 years.

Track II: Long term foreign currency denominated ECB with MAM of 10 years.

Track III: Indian Rupee denominated ECB with MAM of 3/5 years.

Other Highlights – Fewer restrictions on end use, higher all in cost ceiling, INR denominated ECBs where the risk is borne by lenders, bigger list of overseas lenders.

Complete details can be found in the RBI circular which will take in the effect of Gazette Notification.

As per Foreign Exchange Management (Transfer or Issue of Any Foreign Security) (Amendment) Regulations, 2015, a resident Indian company or a Body Corporate may issue Foreign Currency Convertible Bonds (FCCBs) exceeding USD 500 million to a person resident outside India with the specific approval of RBI. Now RBI in consultation with Govt. of India may prescribe provisions for issuance of FCCBs under the approval and automatic route.
RBI has once again extended the due date for exchange of the pre-2005 currency notes till 30th June, 2016.
Under Merchandise Exports from India Scheme (MEIS), shipping bills, where declaration of intent ‘Y’ has not been marked and ‘N’ has been ticked inadvertently in the ‘reward item box’ while filing shipping bills in Customs for exports made between 01.06.2015 to 30.09.2015, can now claim the export incentives by following certain procedures.
Note: The contents of this
Newsletter are only a summary and has not dealt with any issue in detail. Any action
taken or proposed to be taken must be in consultation with professionals and not
merely based on the articles / news updates. Lex Valorem disclaims all liability on action taken without professional advice.

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