Reporting Requirement under clause 30C and 44 of form 3CD (Tax Audit Report )

Updates related to reporting Requirement under clause 30C and 44 of Tax Audit Report

Central Board of Direct Taxes (CBDT) issued order under section 119 of Income-tax Act 1961 on April 24th April 2020 regarding keeping in abeyance some clauses of form 3CD.

Section 44AB of Income-tax Act, 1961 read with rule 6G of Income-tax Rules, 1962 requires specified person to furnish Tax Audit Report along with certain particulars in form 3CD. The form 3CD was amended vide notification no. GSR 666(E) dated 20th July 1988 w.e.f. 20th August 2018.

However, reporting on clause 30C and 44 of the tax audit report in form 3CD was kept in abeyance till 31st March, 2019 vide circular no. 06/2018 dated 17th August 2018 which was subsequently extended to 31.03.2020vide circular no. 09/2019.

CBDT, vide circular no. 10/2020 dated 24th April 2020, due to prevailing circumstances due to Global Pandemic spread by CoVID 19 virus has decided to keep clause 30C and 44 of tax audit report in abeyance till 31st March 2021.

Clause 30C of Tax Audit Report is related to GAAR provisions as mentioned in Income-tax Act, 1961 whereas clause 44 related to reporting of  Break-up of total expenditure of entities registered or not registered under the GST.

Source: https://www.incometaxindia.gov.in/communications/circular/circular_no_10_2020.pdf 

DISCLAIMER

The material and information contained in this blog are for general information purpose only.  Though we have made every efforts to make our interpretation correctly, we do not make representation either express or implied about the completeness or correctness of the subject matter.  Under no circumstances the author is not responsible / liable for any loss or damage caused to anyone due to any mistake / error / omissions.

Deposit under Capital Gain Saving Scheme (CGSS) for Claiming exemption from Capital Gain Tax

DEPOSIT UNDER CAPITAL GAINS ACCOUNTS SCHEME, 1988

There is some exemption given in U/s 54, 54B, 54D, 54F, 54G, 54GA or 54GB of the Income-tax Act, 1961. To avail such exemption the assessee is required to invest the sale consideration within specified period as mentioned in those section. In most of cases, the time period for the investment is beyond the due date for filing of Income Tax Return and there the Government had given an option to park such uninvested money in a particular account which is specified as CAPITAL GAIN SAVING SCHEME (CGSS).

CGSS is applicable on all the eligible assesses.

Eligible Assessee

Following assesees are eligible to deposit under Capital Gain Saving Scheme 1988 and claim exemption from payment of capital gain tax:

Section	Capital Gain on	Eligible assessee
54	Sale of Residential Property (LTCG)	Individual or Hindu Undivided Family (HUF)
54B	Sale of Land Used for agricultural Purpose	Individual or HUF
54D	Compulsory acquisition of lands and buildings forming part of Industrial undertaking	Any assessee
54F	Sale of capital assets other than Residential Property (LTCG)	Individual or HUF
54G	Transfer of assets being Plant, machinery, land or building or right in land or building on shifting of Industrial undertaking from urban area	Any assessee
54GA	Transfer of assets being Plant, machinery, land or building or right in land or building on shifting of Industrial undertaking from urban area to Special Economic Zone (SEZ)	Any assessee
54GB	Sale of Residential Property (a house or a plot of land) (LTCG)	Any assessee

When to Invest in CGSS?

Where assessee could not spend the amount as specified under different sections, such  eligible assessee is required to deposit in CGSS account on or before the due date for filing of income tax return specified for such assessee.

Where to Deposit the amount?

The amount can be deposited in any branch of nationalized banks. 

Type of Account

There are two type of account which can be opened under CGSS. They can be either Type A (Saving Deposit) or Type B (Term Deposit (Cumulative or Non-Cumulative) Account).

Type A account can be converted in Type B account and vice versa. However such transfer will be regarded as premature withdrawal if done before maturity of time period. Form B can be used for transfer from Type A to Type B account or vice versa.

Accounts can be transferred from one branch to another branch of a particular deposit bank however it can not be transferred to different deposit bank.

Interest

Type A: Saving Deposit Account

Interest rate is fixed by Reserve Bank of India and will be calculated on minimum monthly balance (between the close of the 10th day and the end of the month) in the account and will be credited in account half yearly.

Type B: Term Deposit (Cumulative or Non-Cumulative) Account

Interest rate is fixed by Reserve Bank of India. In case of cumulative deposit in account-B, the amount of interest accrued will be deemed to have been reinvested and in case of non-cumulative deposit in account-B, the amount of interest will become due and payable at quarterly intervals.

Nomination

Nomination can be made by depositor in Form E. Nomination can be made upto three (3) persons who can receive the balance amount in capital Gain saving accounts in case of his death. Nomination can be changed anytime by submitting fresh nomination in Form F.

No nomination can be made in case account is opened in the name of Minor, HUF, BOI or AOP. However nomination can be made in the name of Minor.

Withdrawal from the account

Type A: Saving Deposit Account

Withdrawals under this account can be made from time to time by the depositor. Depositor shall have to apply in Form C together with passbook of account in case of initial withdrawal and in case of subsequent withdrawal, Form D (in duplicate) along-with details of utilization of previous withdrawals.

Type B: Term Deposit (Cumulative or Non-Cumulative) Account

Withdrawals under this account can be made only after the expiry of the period for which the deposit under this account has been made and accepted. Premature withdrawal can be done by opening and transferring the amount in Type A saving deposit account.

The amount withdrawn shall be utilized within 60 days from the date of withdrawal for the purpose specified in the particular section under which exemption was claimed and where the amount is not utilized within that period, it shall be deposited in Type A account immediately thereafter.

Charge or Alienation of Capital Gain Saving Scheme Account

The amount deposited/standing to the credit in Capital Gain Saving Scheme Account can not be offered as security for any loan or guarantee and shall not be charged or alienated in any manner whatsoever.

Closure of Capital Gain Saving Scheme Account

The Capital Gain Saving Scheme Account can be closed with the approval of Assessing Officer. The depositor has to make application in Form G.

Where application for closure is made by Nominee or legal heir of deceased depositor, Form H is to used.

DISCLAIMER

The material and information contained in this blog are for general information purpose only.  Though we have made every efforts to make our interpretation correctly, we do not make representation either express or implied about the completeness or correctness of the subject matter.  Under no circumstances the author is not responsible / liable for any loss or damage caused to anyone due to any mistake / error / omissions.

TDS on transfer of Immovable Property Transferred by Resident (Section 194IA)

TDS on transfer of certain immovable property other than agricultural land

Section 194IA was introduced by Finance Act, 2013 to bring transaction on Immovable Property into ambit of TDS provisions under Income Tax Act, 1961. As per this section, Tax Deducted at Source (TDS) is required to be deducted by Transferee on making payment to Transferor for purchase of immovable property.

Who need to deduct TDS

Any person (transferee) responsible for paying a sum for transfer of an immovable property to Resident Transferor.

Threshold limit for Applicability of Section 194IA

Section 194IA is applicable only where the consideration for transfer of immovable property shall be 50 Lakhs or more.

When to Deduct TDS

TDS is required to be deducted:

   1)    at the time of credit of such sum in account of the transferor or   

   2)    payment of such sum in cash or by cheque or draft or any other mode

whichever is earlier.

Where payment is made in installments, TDS should be deducted on installments only.

Rate of TDS

TDS is required to be deducted at 1% (one percent) of amount credited/amount paid.

Immovable Property

Immovable property means any land (other than agricultural land) or any building or part of a building.

Agricultural Land means agricultural land in India not being a land situate in any area referred to in items (a) and (b) of sub-clause (iii) of clause (14) of section 2

Responsibility of Purchaser of Immovable Property

• Deduction of TDS at 1 % on payments being made where consideration for transfer of immovable property exceeds Rs. 50 Lakhs or more
• Obtain Permanent Account Number (PAN) of Sellers
• No Tax Deduction Number (TAN) is required for filing of TDS return in form 26QB and only PAN of sellers and purchasers are required
• Filing of online form 26QB at http://www.tin-nsdl.com website to report transaction related to sale -purchase of immovable property. PAN of sellers and purchasers are mandatorily required to quote in form 26QB.
• TDS may be deposited :

§  either through e-payment facility at the time of filing of 26QB or thereafter using net banking facility

§  or using electronic payment facility at authorized banks

• In case the seller does not furnish his PAN, tax will have to be deducted at 20 percent.

Time-limit for deposit of TDS in Government A/c

TDS deducted in a month is required to be deposited within a period of thirty days from the end of the month in which the deduction is made and shall be accompanied by a challan-cum-statement in Form No. 26QB.

TDS Certificate

TDS certificate is required to be issued in form 16B within 15 days from the due date for furnishing the challan-cum-statement in Form No. 26QB.

DISCLAIMER

The material and information contained in this blog are for general information purpose only.  Though we have made every efforts to make our interpretation correctly, we do not make representation either express or implied about the completeness or correctness of the subject matter.  Under no circumstances the author is not responsible / liable for any loss or damage caused to anyone due to any mistake / error / omissions.

TDS on transfer of Immovable Property Transferred by Non-Resident

TDS On Transfer Of Certain Immovable Property Where Property Is Transferred By Non Resident

A transferee of Immovable Property is required to deduct TDS while making payment to Transferor on payment for transfer of Immovable Property.

Section 194IA of Income Tax Act, 1961 specifically deals with Tax Deducted at Source (TDS) on certain Immovable Property where Transferee makes payment to RESIDENT Transferor. However, where the transferee makes payment to NON-RESIDENT Transferor of immovable property, Transferee is required to deduct TDS under section 195 of Income Tax Act, 1961. In such cases, prevailing Income Tax is required to be deducted from the amount of payment.

Who need to deduct TDS

Any person (transferee) responsible for paying a sum for transfer of an immovable property to Non-Resident Transferor

Threshold limit for Applicability

There is no threshold limit for applicability of tax deduction on payment being made to non-resident transferor of the immovable property.

When to Deduct TDS

TDS is required to be deducted:

   1)    at the time of credit of such sum in account of the transferor or   

   2)    payment of such sum in cash or by cheque or draft or any other mode

whichever is earlier.

Rate of TDS

Rate of Income tax (TDS) to be deducted shall be 20% or 30% depending on holding period of the immovable property by NON-RESIDENT Transferor. Lower or NIL tax deduction certificate can be obtained from Assessing Officer 

Responsibility of Purchaser of Immovable Property

• Deduction of TDS  shall be at 20%/30% on payments being made to NON-RESIDENT transferor
• Need to obtain Tax Deduction Number (TAN) for himself
• Pay TDS by 7^th of Next month in Government Account
• File TDS return in form 27Q
• Download TDS certificate in form 16A.

Time-limit for deposit of TDS in Government A/c

·         TDS deducted in a month is required to be deposited within a period of seven days from the end of the month in which the deduction is made

TDS Return

·         TDS return is required to be filed quarterly:

TDS Certificate

•   TDS certificate is required to be issued in form 16A within 15 days after filing of TDS return in Form 27Q.

DISCLAIMER

The material and information contained in this blog are for general information purpose only.  Though we have made every efforts to make our interpretation correctly, we do not make representation either express or implied about the completeness or correctness of the subject matter.  Under no circumstances the author is not responsible / liable for any loss or damage caused to anyone due to any mistake / error / omissions.