CA NAVEEN ND GUPTA - PowerPoint PPT Presentation

Loading...

PPT – CA NAVEEN ND GUPTA PowerPoint presentation | free to download - id: 7db7f2-YTI4M



Loading


The Adobe Flash plugin is needed to view this content

Get the plugin now

View by Category
About This Presentation
Title:

CA NAVEEN ND GUPTA

Description:

Does the person need to file a declaration in respect of those assets under Chapter VI of ... (GFI) research report ... 8_Organic 9_Organic 10_Organic 11_Organic 12 ... – PowerPoint PPT presentation

Number of Views:7
Avg rating:3.0/5.0
Slides: 68
Provided by: Aksh6
Category:
Tags: gupta | naveen | chapter

less

Write a Comment
User Comments (0)
Transcript and Presenter's Notes

Title: CA NAVEEN ND GUPTA


1
Black Money (Undisclosed Foreign Income and
Assets ) Imposition of Tax Act2015 Reassessme
nt of Income TDS/Reporting on IMPORTS
  • CA NAVEEN ND GUPTA
  • naveen_at_dassgupta.com
  • 9810689998

2
Jurisprudence of Black Money (Undisclosed
Foreign Income Assets ) Imposition of Tax
Act2015
  • India contribute 10 of billions illegally moved
    out of developing emerging nations. USD 991.2
    billion was moved out of developing emerging
    nations for "crime, corruption, and tax evasion",
    and we shipped out 1/10th of that.
  • India ranks 3rd in line-up of countries with
    money hidden abroad. USD 94.76 billion (or Rs 6
    lakh crore) was hidden abroad in 2012. So assume
    a bit more than that for 2015. (2014 Global
    Financial Integrity (GFI) research report)
  • India is going through a revolutionary decade
    where there has been strong moves to bring black
    money into India
  • The Finance Minister, in this pursuit, announced
    in his 2015 Budget Speech that a new
    comprehensive law will be introduced to deal with
    the black money abroad.
  • The Black Money (Undisclosed Foreign Income and
    Assets) and Imposition of Tax Act2015 was
    assented by President on 26 May 2015, Black Money
    Law to be now effective from 01-July 2015..
  • The new legislation provides for separate
    taxation of any undisclosed income in relation to
    foreign assets under the Income Tax, guided by
    this new legislation

3
Scope Applicability
  • It extends to whole of India (i.e. covers JK
    etc.)
  • It applies to all person resident in India (other
    than not ordinary resident in India) u/s 6(6) of
    Income Tax Act, 1961 (including legal heirs)
  • This bill covers ALL RESIDENTS, therefore also
    covers COMPANIES (and other entities)
  • In case of companies, if it is proved that the
    offence has been committed with the consent or
    connivance or is attributable to any neglect on
    the part of the manager, secretary or other
    officer of the company, such person will also be
    held guilty and liable
  • There are specific provisions for making managers
    ( defined to include the managing director in
    certain instances) of a company jointly, and
    severally liable for payment of any amount due if
    the amount cannot be recovered from the company
  • Intends to tax undisclosed foreign income and
    undisclosed foreign assets(including financial
    interest in an entity)
  • Hence such income will not be taxed under Income
    Tax Act, 1961
  • Income taxable _at_ 30 (flat) without
    deduction/exemption.
  • No time limit for foreign income/assets escaping
    assessment

4
Scope and Definitions
  • How to determine if you are Resident and
    Ordinarily Resident(check your passports)
  • Yes No
  • Yes
  • No

Stayed in India for 182 days or more in the
relevant year? OR Stayed for 60 days or more in
the relevant year AND 365 days or more in the
preceding 4 previous years
Non Resident
Have you been a non-resident in 9 out of the 10
preceding previous years? OR Have you during the
preceding 7 years been in India for 729 days or
less?
This Bill is applicable only to Residents who are
Ordinarily Resident and not the others
Resident and Not Ordinarily Resident
Resident and Ordinarily Resident
5
Undisclosed Foreign Income Assets Definitions
  • Undisclosed Foreign Income- Means total amount
    of undisclosed income of an assessee from a
    source located outside India
  • Undisclosed Assets located outside India- Means
    an asset (including financial interest in an
    entity) located outside India, held by the
    assessee in his own name or of which he is
    beneficial owner and he has no explanation about
    the source of investment or explanation given is
    unsatisfactory.

6
Total Undisclosed Foreign Income and Asset of
Previous Year
  • The income from a source located outside India,
    which has not been disclosed in the return of
    income filed within time specified u/s. 139 (1)
    or 139 (4) or 139(5) Income Tax Act
  • The income, from a source located outside India,
    in respect of which a return is required to be
    furnished under section 139 (1) but no return of
    income has been furnished.
  • The value of an undisclosed asset located outside
    India.
  • Valuation for Taxation- Undisclosed foreign
    asset shall be charged to tax at fair market
    value in the previous year in which asset comes
    to the notice of assessing officer.
  • Computation No deduction of expenditure
    allowance or set off of any loss allowed(it may
    be allowable under IT Act).
  • Rate of Taxation of Foreign Income and Foreign
    Assets Undisclosed Foreign Income Fair Market
    Value of Undisclosed Foreign Assets will be taxed
    at a flat rate of 30 followed by penalties (100
    to 300) as may be decided by the Assessing
    Officer.

7
FAIR MARKET VALUATION
Value of Bullion, Jewellery or Precious Stone shall be HIGHER OF
Its cost of acquisition and The price that the bullion, jewellery or precious stone shall ordinarily fetch if sold in the open market on the valuation date for which the assessee may obtain a report from a Valuer recognized by the Government of a country or specified territory outside India or any of its agencies for the purpose of valuation of bullion, jewellery or precious stone under any regulation or law.
8
FAIR MARKET VALUATION
Valuation of Artistic Work or any work of art shall be HIGHER of
Its cost of acquisition and The price that the artistic work shall ordinarily fetch if sold in the open market on the valuation date for which the assessee may obtain a report from a Valuer recognized by the Government of a country or specified territory outside India or any of its agencies for the purpose of valuation of artistic work under any regulation or law.
9
FAIR MARKET VALUATION
Valuation of QUOTED Shares and Securities shall be the HIGHER OF
The fair market value of quoted share and securities
Its cost of acquisition and The price as determined in the following manner, namely The average of the lowest and highest price of such shares and securities quoted on any established securities market on the valuation date or Where on the valuation date there is no trading in such shares and securities on any established securities market, average of the lowest and highest price of such shares and securities on any established securities market on a date immediately preceding the valuation date when such shares and securities were traded on such securities market
10
FAIR MARKET VALUATION
The Fair market value of UNQUOTED equity shares shall be the HIGHER of
Its cost of acquisition and The value, on the valuation date, of such equity shares as determined in following manner The fair market value of unquoted equity shares (ABL)/(PE) x (PV) where, A Book value of all the assets (other than bullion, jewellery, precious stone, artistic work, shares, securities and immovable property) as reduced by,- any amount of income-tax paid, if any, less amount of income-tax refund claimed, any amount shown as asset including the unamortized amount of deferred expenditure which does not represent the value of any asset B Fair market value of bullion, jewellery, precious stone, artistic work, shares, securities and immovable property as determined in the manner provided in this rule
11
FAIR MARKET VALUATION

L Book value of liabilities, but not including the following amounts, namely- (i) The paid-up capital in respect of equity shares (ii) The amount set apart for payment of dividends on preference shares and equity shares (iii) Reserves and surplus, by whatever name called, even if the resulting figure is negative, other than those set apart towards depreciation (iv) Any amount representing provision for taxation, other than amount of income-tax paid, if any, less the amount of income-tax claimed as refund, if any, to the extent of the excess over the tax payable with reference to the book profits in accordance with the law applicable thereto (v) Any amount representing provisions made for meeting liabilities, other than ascertained liabilities (vi) Any amount representing contingent liabilities other than arrears of dividends payable in respect of cumulative preference shares PE total amount of paid up equity share capital as shown in the balance-sheet PV the paid up value of such equity shares
12
FAIR MARKET VALUATION
Fair market value of an IMMOVABLE PROPERTY shall be higher of
Its cost of acquisition and The price that the property shall ordinarily fetch if sold in the open market on the valuation date for which the assessee may obtain a valuation report from a valuer recognized by the Government of a country or specified territory outside India in which the property is located or any of its agencies for the purpose of valuation of immovable property under any regulation or law
13
FAIR MARKET VALUATION
Value of an ACCOUNT with a BANK shall be
The sum of all the deposits made in the account with the bank since the date of opening of the account or Where a declaration of such account has been made under Chapter VI and the value of the account as computed under sub-clause (I) has been charged to tax and penalty under that Chapter, the sum of all the deposits made in the account with the bank since the date of such declaration Provided that where any deposit is made from the proceeds of any withdrawal from the account, such deposit shall not be taken into consideration while computing the value of the account.
14
FAIR MARKET VALUATION
Value of an interest IN PARTNERSHIP FIRM OR AOP OR LLP (Such Entity)
The Net Asset of Such Entity on valuation date shall first be determined as under Portion of Net Asset of Such Entity as is equal to the amount of its capital shall be allocated among its partners in proportion of capital contribution Residual Net Asset shall be allocated among the partners in the proportion of Profit Sharing Ratio (SUM TOTAL OF AMOUNT SHALL BE VALUE OF INTEREST OF PARTNER IN SUCH ENTITY) Explanation- For purposes of this clause Net Asset of Such Entity shall be (A B L), which shall be determined in the manner provided in sub-clause (II) of clause (c).
15
FAIR MARKET VALUATION
Value of any OTHER ASSETS shall be higher of
Its cost of acquisition or the amount invested and The price that the asset would fetch if sold in the open market on the valuation date in an arms-length transaction.
16
Compliance Scheme
  • In Compliance Scheme assessee has to pay 30 tax
    30 penalty

30th Sep 2015 is date on or before which Person may make Declaration in respect of an Undisclosed Foreign Asset Income in Form No. 6
The CIT (International Tax)-2, Pratyaksh Kar Bhavan, S.P.M. Civic Centre, Minto Road, New Delhi-110002 has been designated to receive the declarations. CIT inform the declarant by 31.10.2015 whether the competent authority already has any information in respect of the asset(s) declared under Sec 90 or 90A of the Income Tax Act1961.
The declarant may revise his declaration excluding such assets within 15days of receipt of intimation.
The declarant not liable for any consequences under the Black Money Act in respect of assets which has been declared but found ineligible for declaration due to prior information on such assets. However such information may be used under provisions of Income Tax Act1961.
PAN No. must for declaration of undisclosed asset outside India
Tax and penalty in respect of the undisclosed foreign assets so declared to be paid by 31st Dec 2015
Upon payment of tax and penalty, CIT will issue an acknowledgement in Form 7
17
COMPLIANCE SCHEME FORM 6 WHOM TO BE SIGNED
Status of Declarant Declaration to be Signed By
Individual Individual, where absent from India, person authorized by him, where mentally incapacitated, his guardian or other person competent to act on his behalf.
HUF Karta, where absent from India or mentally incapacitated from attending to affairs, by ant other adult member of HUF
Company Managing Director, where for any unavoidable reason managing director is not able to sign or there is no managing director, by any director
Firm Managing partner for any unavoidable reason managing partner is not able to sign, or where there no managing partner, by any major partner.
Any other association Any member of the association or the principal officer.
Any other person That person or by some other person competent to act on his behalf.
18
Declaration not eligible in certain cases
  • As per Sec 71 no declaration under Compliance
    window which has been acquired from income
    chargeable to tax for A.Y 2015-16 or any earlier
    assessment year in following cases

1. Where a notice U/s 142 or Sec 143(2) or Sec 148 or Sec 153A or Sec 153C of the Income-tax Act1961 has been issued in respect of such assessment year and the proceeding is pending before the AO. Person not eligible if any notice referred above has been served on or before 30th June 2015
2. Where a search has been conducted U/s 132 or requisition has been made under Sec 132A or a survey has been carried out under Sec 133A of the Income-tax Act1961 in a previous year and the time for issuance of a notice U/s 143 (2) or Sec 153A or Sec 153C for the relevant assessment year has not expired. In Form 6 the declarant will also verify that these facts do not prevail in his case
19
Declaration not eligible in certain cases
3. Where any information has been received by the competent authority under an agreement entered into by the Central Government under section 90 or section 90A of the Income-tax Act 1961 in respect of such undisclosed asset.
4. A person in respect of whom proceedings for prosecution of any offence punishable under Chapter IX (offences relating to public servants) or Chapter XVII (offences against property) of the Indian Penal Code or under the Unlawful Activities (Prevention) Act or the Prevention of Corruption Act are pending shall not be eligible.
5. A person in respect of whom provisions of Sec 71(a) in respect of Conservation of Foreign Exchange Prevention of Smuggling Activities Act1974 or not notified under Sec 3 of Special Court (Trial of Offences relating to Transactions in Securities) Act1992.
20
Circumstances where Declaration shall be invalid
1. If declarant fails to pay the entire amount of tax and penalty upto 31.12.2015
2. Where declaration has been made by misrepresentation or suppression of facts or information.
  • Consequences Of Invalid Declaration

1. Where the declaration is held to be void for any of reasons, it shall be deemed never to have been made and all the provisions of the Act, including penalties and prosecution shall apply
2. Any tax or penalty paid in pursuance of the declaration shall not be refundable under any circumstances.
21
Effect of Valid Declaration
The amount of Undisclosed Investment in the assets declared shall not be included in the total income under the Income Tax Act for any assessment year.
The contents of the declaration shall not be admissible in evidence against the declarant in any penalty or prosecution proceedings under Income Tax Act, Wealth Tax Act, The Foreign Exchange Management Act, Companies Act or Customs Act
The value of assets declared in declaration shall not be chargeable to Wealth Tax for any assessment year or years.
Declaration of Undisclosed Foreign Asset will not affect the finality of completed assessment. The declaration will not be entitled to claim re-assessment of any earlier year or revision of any order or any benefit or set-off or relief in any appeal or proceeding under the Act or Income Tax Act in respect of declared undisclosed asset located outside India or any tax paid thereon.
22
Source of Information Power to make enquiry
(Sec 10).
  • The AO may
  • On receipt of information from income tax
    authority under Income Tax Act1961
  • Any other authority under any law for the time
    being in force
  • On coming of any information to his notice
  • Serve on any person a notice requiring him to
    produce such
  • accounts or
  • documents or
  • evidence
  • as the AO may require for the purpose of this Act.

23
Penalty and Prosecution (1/2)
Nature Penalty Prosecution(if any)
Non Disclosure of Foreign Income or Asset 300 of the Tax Payable
Failure to disclose the foreign asset or income in the return of income or furnished inaccurate particulars or failure to furnish return in respect of foreign asset Rs.10 Lakhs 6 months 7 years if default can be proved to be wilful
If person wilfully attempts to evade any tax, penalty or interest 3 years 10 years
Continuing default by assessee in making payment of tax Amount of arrears of tax
If assessee fails to answer any question, sign a statement he is legally bound to or fails to produce books and supporting evidences Rs.50,000 to Rs.2,00,000
24
Penalty and Prosecution (2/2)
Nature Penalty Prosecution(if any)
Person makes false statement or delivers false evidences 6 months 7 years
Abetment to make and deliver false return, account, statement or declaration relating to tax payable 6 months 7 years
Subsequent offences under this act where a person commits the second(or more) offence under this act Rs.5 lakhs Rs.1 crore 3 years 10 years
But Asset, being one or more bank accounts having
aggregate balance not exceeding Rs. 5 lacs at any
time during previous year then EXEMPTION from
Above Penalties.
25
Black Money Compliance Scheme QA.
Question If firm has undisclosed foreign assets, can the partner file declaration in respect of such asset?
Answer The declaration can be made by the firm which shall be signed by the person specified in sub-section (2) of section 62 of the Act. The partner cannot make a declaration in his name. However, the partner may file a declaration in respect of an undisclosed asset held by him.
  • The

Question Whether immunity in respect of declaration made under the scheme is provided in respect of Acts other than those mentioned in section 67 of the Act?
Answer Section 67 provides immunity from prosecution under the five Acts viz. the Income-tax Act, Wealth-tax Act, FEMA, Companies Act and the Customs Act. It does not provide immunity from prosecution under any other Act. For example- if the undisclosed asset has been acquired out of the proceeds of sale of protected animals the person will not be eligible for immunity under the Wildlife (Protection) Act, 1972.
26
Black Money Compliance Scheme QA.
Question Whether the person making the declaration will be provided immunity from the Prevention of Money Laundering Act, 2002?
Answer The offence under the PMLA arises while laundering money generated from the process or activity connected with the offences specified in the schedule to the PMLA. Therefore, the primary requirement under PMLA is commission of a scheduled offence. With the enactment of the Act, the offence of willful attempt to evade tax under section 51 of the Act has become a scheduled offence under PMLA. However, where a declaration of an asset has been duly made under section 59 of the Act the provisions of section 51 will not be applicable in respect of that asset. Therefore, PMLA will not be applicable in respect of the scheduled offence of wilful attempt to evade tax under section 51 of the Act in respect of assets for which declaration is made under section 59 of the Act.
  • The

27
Black Money Compliance Scheme QA.
Question Where an undisclosed foreign asset is declared under Chapter VI of the Act and tax and penalty is paid on its fair market value then will the declarant be liable for capital gains on sale of such asset in the future? If yes, then how will the capital gains in such case be computed?
Answer Yes, the declarant will be liable for capital gains under the Income-tax Act on sale of such asset in future. As per the current provisions of the Income-tax Act, the capital gains is computed by deducting cost of acquisition from the sale price. However, since the asset will be taxed at its fair market value the cost of acquisition for the purpose of Capital Gains shall be the said fair market value and the period of holding shall start from the date of declaration of such asset under Chapter VI of the Act.
  • The

28
Black Money Compliance Scheme QA.
Question Where an undisclosed foreign asset has acquired partly during a previous year relevant to assessment year which is pending for assessment and partly during other years not pending for assessment then whether such asset is eligible for declaration under Chapter VI of the Act?
Answer In the case where proceedings are pending before an AO in pursuance of a notice U/s 142, 143(2), 148, 153A or 153C served on or before 30-06-2015, the declarant may declare the undisclosed asset under Chapter VI of the Act. However, while computing the amount of declaration the investment made in the asset during the previous year relevant to the assessment year for which such notice is issued needs to be deducted from the fair market value of the asset for which the person shall provide a computation along with the declaration. Further, such investment which is deducted from the fair market value shall be assessable in the assessment of the relevant assessment year pending under the Income-tax Act and the person shall inform the Assessing Officer the investment made during the relevant year in such asset. Also to clarify, where a notice under section 142, 143(2), 148, 153A or 153C of the Income-tax Act is issued on or after 30-06-2015, the declarant shall be eligible to declare full value of asset even if such asset (or part of such asset) is acquired in the previous year relevant to the assessment year for which such notice is issued.
  • The

29
Black Money Compliance Scheme QA.
Question Can a declaration be made of undisclosed foreign assets which have been assessed to tax and the case is pending before an Appellate Authority?
Answer As per section 65 of the Act, the declarant is not entitled to re-open any assessment or reassessment made under the Income-tax Act. Therefore, he is not entitled to avail the tax compliance in respect of those assets. However, he can voluntarily declare other undisclosed foreign assets which have been acquired or made from income not disclosed and consequently not assessed under the Income-tax Act.
Question Where a search/ survey operation was conducted and the assessment has been completed but the undisclosed foreign asset was not taxed, then whether such asset can be declared under Chapter VI of the Act?
Answer Yes, such undisclosed asset can be declared under Chapter VI of the Act.
30
Black Money Compliance Scheme QA.
Question Can a person against whom a search/ survey operation has been initiated file voluntary declaration under Chapter VI of the Act?
Answer (a) The person is not eligible to make a declaration under Chapter VI if a search has been initiated and the time for issuance of notice under section 153A has not expired, even if such notice for the relevant assessment year has not been issued. In this case, however, the person is eligible to file a declaration in respect of an undisclosed foreign asset acquired in any previous year in relation to an assessment year which is prior to assessment years relevant for the purpose of notice under section 153A. (b) In case of survey operation the person is barred from making a declaration under Chapter VI in respect of an undisclosed asset acquired in the previous year in which the survey was conducted. The person is, however, eligible to make a declaration in respect of an undisclosed asset acquired in any other previous year.
  • The

31
Black Money Compliance Scheme QA.
Question What are the consequences if no declaration under Chapter VI is made in respect of undisclosed foreign assets acquired prior to the commencement of the Act?
Answer As per section 72(c), where any asset has acquired prior to commencement of Act and no declaration is made then such asset shall be deemed to have been acquired in the year in which it comes to the notice of the AO. India is expected to start receiving information through Automatic Exchange of Information (AEOI) route under FATCA from USA later in year 2015. Further, under multilateral agreement India will start receiving information from other countries under AEOI route from 2017 onwards. As at 18.03.15, 58 jurisdictions (including India) have committed to share information under AEOI by 2017 and 36 jurisdictions have committed to share by 2018, including jurisdictions which have beneficial tax regime. The multilateral agreement is expected to cover all the countries in the near future. The information under the AEOI will include information of controlling persons (beneficial owners) of the asset. The possibility of discovery of undisclosed asset may arise at any time in future say for example, information of an immovable property can be unearthed if any utility bills/property tax or even gardeners/ caretakers salary has been paid through an existing or closed bank account. Therefore, if any information of an undisclosed foreign asset acquired earlier, say in the year 1975, for 100,000 comes to the notice of an AO later, say in year 2020, when its value becomes, say, 5 Million, the liability under the Act amounting to 120 of FMV of asset on valuation date may arise in year 2020, besides prosecution and other consequences. In this case if the valuation date is in the year 2020 the amount of tax and penalty under the Act will be 6 Million.
32
Black Money Compliance Scheme QA.
Question A person has some undisclosed foreign assets. If he declares those assets in the Income-tax Return for assessment year 2015-16 or say 2014-15 (in belated return) then should he need to declare those assets in the voluntary tax compliance under Chapter VI of the Act?
Answer As per the Act, the undisclosed foreign asset means an asset which is unaccounted/ the source of investment in such asset is not fully explainable. Since an asset reported in Schedule FA does not form part of computation of total income in the Income-tax Return and consequently does not get taxed, mere reporting of a foreign asset in Schedule FA of the Return does not mean that the source of investment in the asset has been explained. The foreign asset is liable to be taxed under the Act (whether reported in the return or not) if the source of investment in such asset is unexplained. Therefore, declaration should be made under Chapter VI of the Act in respect of all those foreign assets which are unaccounted/ the source of investment in such asset is not fully explainable.
33
Black Money Compliance Scheme QA.
  • The

Question A person holds certain foreign assets which are fully explained and acquired out of tax paid income. However, he has not reported these assets in Schedule FA of the Income-tax Return in the past. Should he declare such assets under Chapter VI of the Act?
Answer Since, these assets are fully explained they are not treated as undisclosed foreign assets and should not be declared under Chapter VI of the Act. However, if these assets are not reported in Schedule FA of the Income-tax Return for assessment year 2016-17 (relating to previous year 2015-16) or any subsequent assessment year by a person, being a resident (other than not ordinarily resident), then he shall be liable for penalty of Rs. 10 lakhs under section 43 of the Act. The penalty is, however, not applicable in respect of an asset being one or more foreign bank accounts having an aggregate balance not exceeding an amount equivalent to Rs. 5 lakhs at any time during the previous year.
34
Black Money Compliance Scheme QA.
  • The

Question A person has a foreign bank account in which undisclosed income has been deposited over several years. He has spent the money in the account over these years and now it has a balance of only 500. Does he need to pay tax on this 500 under the declaration?
Answer Section 59 provides for declaration of an undisclosed asset and not income. In this case Bank account is an undisclosed asset which may be declared. Tax on undisclosed asset is required to be paid on its fair market value. In case of bank account the FMV is the sum of all the deposits made in the account computed in accordance with Rule 3(1)(e). Therefore, tax and penalty needs to be paid on such fair market value and not on the balance as on date.
Question A person is a resident now. However, he was a non-resident earlier when he had acquired foreign assets (which he continues to hold now) out of income which was not chargeable to tax in India. Does the person need to file a declaration in respect of those assets under Chapter VI of the Act?
Answer No. Those assets do not fall under the definition of undisclosed assets under the Act.
35
Black Money Compliance Scheme QA.
  • The

Question A person held a foreign bank account for a limited period between 1994-95 and 1997-98 which was unexplained. Since such account was closed in 1997-98 does he need to declare the same under Chapter VI of the Act?
Answer Section 59 of the Act provides that the declaration may be made of any undisclosed foreign asset which has been acquired from income which has not been charged to tax under the Income-tax Act. Since the investment in the bank account was unexplained and was from untaxed income the same may be declared under Chapter VI of the Act. The consequences of non-declaration may arise under the Act at any time in the future when the information of such account comes to the notice of the Assessing Officer.
36
Black Money Compliance Scheme QA.
  • The

Question A person inherited a house property in 2003-04 from his father who is no more. Such property was acquired from unexplained sources of investment. The property was sold by the person in 2011-12. Does he need to declare such property under Chapter VI of the Act and if yes Page 9 of 13 then, what will be the fair market value of such property for the purpose of declaration?
Answer Since the property was from unexplained sources of investment the same may be declared under Chapter VI of the Act. However, the declaration in this case needs be made by the person who inherited the property in the capacity of legal representative of his father. The fair market value of the property in his case shall be higher of its cost of acquisition and the sale price as per Rule 3(2) of the Rules.
Question In respect of the undisclosed foreign assets referred to in answer to question No. 15 above, where the proceedings under the Income-tax Act are initiated, can the options of settlement commission etc. under the Income-tax Act be availed in respect of such assets?
Answer All the provisions of the Income-tax Act shall be applicable in respect of those assets.
37
Black Money Compliance Scheme QA.
Question A person acquired a house property in a foreign country during the year 2000-01 from unexplained sources of income. The property was sold in 2007-08 and the proceeds were deposited in a foreign bank account. Does he need to declare both the assets under Chapter VI of the Act and pay tax on both the assets?
Answer The declaration may be made in respect of both the house property and the bank account at their fair market value. The fair market value of the house property shall be higher of its cost and the sale price, less amount deposited in bank account. If the cost price of the house property is higher the declarant will be required to pay tax and penalty on (cost price sale price) of the house. If the sale price of the house property is higher the fair market value of the house property shall be nil as full amount was deposited in the bank account. The fair market value of the bank account shall be as determined under Rule 3(1)(e) and tax and penalty shall be paid on this amount. (Please also refer to the illustration under Rule 3(3) for computation of fair market value.) Further, it is advisable to declare all the undisclosed foreign assets even if the fair market value as computed in accordance with Rule 3 comes to nil. This may avoid initiation of any inquiry under the Act in the future in case such asset comes to the notice of the Assessing Officer.
  • The

38
Black Money Compliance Scheme QA.
Question A person is a non-resident. However, he was resident of India earlier and had acquired foreign assets out of income chargeable to tax in India which was not declared in return of income or no return was filed in respect of that income. Can that person file a declaration.
Answer Section 59 provides that a declaration may be made by any person of an undisclosed foreign asset acquired from income chargeable to tax under the Income-tax Act for any assessment year prior to assessment year 2016-17. Since the person was a resident in the year in which he had acquired foreign assets (which were undisclosed) out of income chargeable to tax in India, he is eligible to file a declaration under section 59 in respect of those assets under Chapter VI of the Act.
  • The

Question If a person has 3 undisclosed foreign assets and declares only 2 of those under Chapter VI of the Act, then will he get immunity from the Act in respect of the 2 assets declared?
Answer It is expected that one should declare all his undisclosed foreign assets. However, in such a case the person will get immunity under the provisions of the Act in respect of the two assets declared under Chapter VI of the Act and no immunity will be available in respect of the third asset which is not declared.
39
Black Money Compliance Scheme QA.
  • The

Question A resident earned income outside India which has been deposited in his foreign bank account. The income was charged to tax in foreign country when it was earned but the same was not declared in return of income in India consequently not taxed in India. Does he need to disclose such income under Chapter VI? Will he get credit of foreign tax paid?
Answer Declaration under Chapter VI is to be made of an undisclosed foreign asset. In this case, the person being a resident of India, the foreign bank account needs to be declared under Chapter VI as it is an undisclosed asset and acquired from income chargeable to tax in India. The fair market value of the bank account shall be determined as per Rule 3(1)(e). No credit of foreign taxes paid shall be allowable in India as section 84 of the Act does not provide for application of sections 90(1)(a)/90(1)(b)/ 90A(1)(a)/ 90A(1)(b) of the Income-tax Act (relating to credit of foreign tax paid) to the Act. Further, section 73 of the Act does not allow agreement with foreign country for the purpose of granting relief in respect of tax chargeable under the Act.
40
Black Money Compliance Scheme QA.
Question If a foreign asset has been acquired partly out of undisclosed income chargeable to tax and partly out of disclosed income/exempt income (tax paid income) then whether that foreign asset will be treated as undisclosed? Whether declaration under Chapter VI needs to be made in respect of such asset? If yes, what amount should be disclosed?
Answer As per section 5 of the Act, in computing the value of an undisclosed foreign asset any income which has been assessed to tax under the Income-tax Act from which that asset is acquired shall be reduced from the value of the undisclosed foreign asset. Only part of the investment is such foreign asset is undisclosed (unexplained) hence declaration of such foreign asset may be made under Chapter VI of the Act. The amount of declaration shall be the fair market value of such asset as on 1st July, 2015 as reduced by the amount computed in accordance with section 5 of the Act.
  • The

Question Whether for the purpose of declaration, the undisclosed foreign asset should be held by the declarant on the date of declaration?
Answer No, there is no such requirement. The declaration may be made if the foreign asset was acquired out of undisclosed income even if the same has been disposed off and is not held by the declarant on the date of declaration.
41
Black Money Compliance Scheme QA.
Question Whether at the time of declaration under Chapter VI, will the Principal Commissioner/Commissioner do any enquiry in respect of the declaration made?
Answer After the declaration is made the Principal Commissioner/ Commissioner will enquire whether any information has been received by the competent authority in respect of the asset declared. Apart from this no other enquiry will be conducted by him at the time of declaration.
  • The

Question A person was employed in a foreign country where he acquired or made an asset out of income earned in that country. Whether such asset is required to be declared under Chapter VI of the Act?
Answer If the person, while he was a non-resident in India, acquired or made a foreign asset out of income which is not chargeable to tax in India, such asset shall not be an undisclosed asset under the Act. However, if income was accrued or received in India while he was non-resident, such income is chargeable to tax in India. If such income was not disclosed in the return of income and the foreign asset was acquired from such income then the asset becomes undisclosed foreign asset and the person may declare such asset under Chapter VI of the Act.
42
  • Re-Assessment of Income

43
Re-Assessment of Income
  • If the Assessing Officer has reason to believe
    that any income chargeable to tax has escaped
    assessment for any assessment year, he may,
    subject to the provisions of section 148 to 153,
    assess or reassess such income and also any other
    income chargeable to tax which has escaped
    assessment and which comes to his notice
    subsequently in the course of the proceedings
    under this section, or recompute the loss or the
    depreciation allowance or any other allowance, as
    the case may be, for the assessment year
    concerned (hereafter in this section and in
    sections 148 to 153 referred to as the relevant
    assessment year)
  • Scope of reassessment
  • Can assess or reassess any income which has
    escaped assessment
  • Can recompute the loss or depreciation allowance
  • Can assess or reassess any other income (which
    is not the subject matter of any appeal or
    revision) which has escaped assessment
  • Cannot reduce the income below what has already
    been assessed in the original assessment

44
Procedure For Re-assessment Proceedings (GKN
Drive Shafts (I) Ltd. 259 ITR 19 (SC))
Issue of Notice - Check limitation
File the Return of Income
Application for certified copy of Reason to
Believe
File the objections for deficiencies in Reason
AO to dispose off Objections by speaking order
Proceedings Issue of notice u/s 143(2) / 142(1)
45
Maintainability of Writ Petition challenging
Reassessment Proceedings ?
  • CALCUTTA DISCOUNT CO. LTD. 41 ITR 191 (SC) A
    Writ Petition is maintainable to challenge
    invocation of reassessment even though it is open
    to assessee to challenge same before AO during
    assessment and also before appellate authority.
  • Samsung India Electronics P. Ltd. 362 ITR 460
    (DEL) In view of procedure laid down by SC in
    GKN Driveshaft India Ltd. the Assessee directed
    to file objections before AO and in case
    objections are rejected, it would be open to
    assessee to approach the High Court.

Aroni Commercials Ltd 367 ITR 405 (Bombay)
Reopening u/s 147 on the basis of change of opinion hits the validity to enter into the jurisdiction to reopen completed assessment.
Distinguishes jurisdiction facts(JF) with adjudicatory facts(AF).
JF are facts which gives jurisdiction to enter upon enquiry, while AF activated after valid invocation of jurisdiction .
If JF itself matter of factual enquiry Then Court in its discretion may not entertain the writ petition.
In this case, challenge is to JF ie pre-condition for issuing notice u/s. 147 is not satisfied, i.e., notice should not be basis change of opinion. Hence, only when JF are satisfied AO acquire the authority to deal with the matter on adjudicatory facts. In this case JF not satisfied hence notice quashed.
46
MATTERS REGARDING ISSUE OF NOTICE
  • Issue of notice recording of reason to believe
    by same AO
  • HYNOUP FOOD AND OIL INDUSTRIES LTD. 307 ITR 115
    (Guj.) Assessing Officer recording reasons
    under section 148(2) and Assessing Officer
    issuing notice under section 148(1) has to be
    same person successor Assessing Officer cannot
    issue notice under section 148 on basis of
    satisfaction recorded by predecessor Assessing
    Officer, because reason to believe that income
    liable to tax for assessment year has escaped
    assessment within meaning of section 147 has to
    be of Assessing Officer concerned, viz.,
    Assessing Officer issuing notice under section
    148
  • Issue Where reopening made by AO not having
    jurisdiction over assessee (i.e notice by
    non-jurisdictional AO) and final assessment by
    non-jurisdictional AO as proceedings are
    transferred mid way is valid?
  • No
  • Paramjeet Singh 220 ITR 446 (PH) Assessee's
    original assessment was completed at Pune -
    Thereafter he shifted to Jalandhar - His
    assessment records had not been transferred to
    Assessing Officer at Jalandhar by passing an
    order under section 127 - On basis of complaints
    received from assessee's relative Assessing
    Officer at Jalandhar initiated reassessment
    proceedings by issuing notice under section 148 -
    Whether Assessing Officer at Jalandhar had no
    jurisdiction to re-open assessment and,
    therefore, notice issued under section 148 was
    liable to be quashed
  • Anjali Dua 219 CTR 183 (Del)
  • Ranjit Singh 120 TTJ 517 (Del)

47
Issue of Notice for re-assessment
  • Issue in 147 Vs. Serve in 143(2)
  • Sec 149 - No notice U/s 148 shall be issued for
    re-assessment
  • Sec 148 Before making assessment/reassessment
    U/s 147 AO shall serve on assessee a notice
    requiring him to furnish Return of Income.
  • Time limit is for issue not service of
    notice U/s 148 (within 6 years from end of AY)
    Section 149 (Mayawati vs. CIT (2010) 321 ITR 349
    (Del.)) Where petitioner-assessee declined to
    accept notice under section 148 three times at
    three addresses which belonged to assessee at
    relevant time, service of notice was to be
    presumed under section 27 of General Clauses Act,
    1897

Condition Limitation Period
If escaped amount likely to be Rs. 1 lakh or more Notice be issued with in six years from the end of relevant assessment year
If escaped amount likely to be less than Rs. 1 lakh Notice be issued with in four years from the end of relevant assessment year
48
CONNECTED ISSUES TO NOTICE
  • Sec. 282 Service of notice generally.
  • 282.(1) The service of a notice or summon or
    requisition or order or any other communication
    under this Act (hereafter in this section
    referred to as communication) may be made by
    delivering or transmitting a copy thereof, to the
    person therein named,
  • by post or by such courier services as may be
    approved by the Board or
  • in such manner as provided under the Code of
    Civil Procedure, 1908 (5 of 1908) for the
    purposes of service of summons or
  • in the form of any electronic record as provided
    in Chapter IV of the Information Technology Act,
    2000 (21 of 2000) or
  • by any other means of transmission of documents
    as provided by rules made by the Board in this
    behalf.

49
CONNECTED ISSUES TO NOTICE
  • Sec 292B Return of income, etc., not to be
    invalid on certain grounds.
  • No return of income, assessment, notice, summons
    or other proceeding, furnished or made or issued
    or taken or purported to have been furnished or
    made or issued or taken in pursuance of any of
    the provisions of this Act shall be invalid or
    shall be deemed to be invalid merely by reason of
    any mistake, defect or omission in such return of
    income, assessment, notice, summons or other
    proceeding if such return of income, assessment,
    notice, summons or other proceeding is in
    substance and effect in conformity with or
    according to the intent and purpose of this Act.
  •  Sec 292BB Notice deemed to be valid in certain
    circumstances.
  • Where an assessee has appeared in any proceeding
    or co-operated in any inquiry relating to an
    assessment or reassessment, it shall be deemed
    that any notice under any provision of this Act,
    which is required to be served upon him, has been
    duly served upon him in time in accordance with
    the provisions of this Act and such assessee
    shall be precluded from taking any objection in
    any proceeding or inquiry under this Act that the
    notice was
  • (a) not served upon him or
  • (b) not served upon him in time or
  • (c) served upon him in an improper manner
  • Provided that nothing contained in this section
    shall apply where the assessee has raised such
    objections before the completion of such
    assessment or reassessment.

50
SECTION 282 SERVICE OF NOTICE GENERALLY
  • RAJESH KUMAR SHARMA 165 TAXMANN 488 (DEL) (282)
    Where revenue not been able to show that
    envelope containing notice under section 148 was
    correctly addressed, revenues case that envelope
    did not return with any remark to effect that it
    was undelivered and so it must be presumed that
    it was actually served upon assessee was
    unsustainable. Assessee entered into appearance,
    after receiving notices under sections 142(1) and
    143(2) and categorically denied receipt of notice
    under section 148, argument of revenue that his
    appearance was in response to notice under
    section 148 did not advance case of revenue that
    notice under section 148 was actually served upon
    assessee.
  • HOTLINE INTERNATIONAL 161 TAXMANN 104 (DEL) 282
    As per order V, rule 12 of the Code of Civil
    Procedure that wherever it is practicable, the
    service has to be effected on defendant in person
    or on his agent. Admittedly, in the instant case,
    notice under section 148 was not tendered to the
    assessee nor the same was refused at all by the
    assessee. It was an admitted case of the revenue
    that when the officials of the Department went to
    serve the notice under section 148 for the
    relevant assessment year, the security guard
    informed them that the company was closed for the
    Holi festival holidays. The security guard by no
    stretch of imagination could be said to be the
    agent of the assessee and, admittedly, no notice
    was tendered either to the assessee or his agent
    nor the same was refused either by the assessee
    or his agent.
  • Under order V, rule 17 of the Code of Civil
    Procedure, the affixation can be done only when
    the assessee or his agent refused to sign the
    acknowledgement or could not be found. In the
    instant case, no effort was made by the
    Income-tax Department to serve the notice upon
    the assessee, since the company of the assessee
    was closed due to Holi festival holidays, and,
    admittedly, no effort was made by the serving
    officer to locate the assessee.

51
MATTERS REGARDING ISSUE OF NOTICE
  • Issue Participation by assessee in assessment
    proceedings on receipt of copy of notice can be
    deemed to be service of notice u/s 148(1)
  • CIT v Three Dee Exim(P)Ltd.(2012) 20 taxman 146
    (Del)
  • Assessment of assessee-company was completed
    under section 143 - Thereafter, on receipt of an
    information a notice under section 148 was issued
    at address other than present address of assessee
    - In response to said notice counsel for assessee
    appeared before Assessing Officer and sought
    adjournment and on that date a photo copy of said
    notice was given - By a letter assessee stated
    that return originally filed be treated as return
    filed in response to said notice - On second
    appeal, Tribunal held that notice was sent at
    address other than present address of assessee
    and hence service of notice was not valid -
    Whether participation of assessee in assessment
    proceedings on receipt of copy of notice can be
    deemed to be service of notice within meaning of
    section 148(1) - Held, yes - Whether therefore,
    Tribunal was not correct in annulling assessment
    framed by Assessing Officer
  • Issue Sec 143(2) v Sec 148
  • ALSTOM TD INDIA LIMITED 45 TAXMAN.COM 424
    (MAD.) Where Assessee requested AO to treat
    Original Return as one in response to Sec 148,
    notice U/s 143(2) was mandatory otherwise
    re-assessment would be bad in law.

52
REASONS TO BELIEVE CHANGE OF OPINION (1)
  • (19.04.02) KELVINATOR OF INDIA LIMITED 123
    TAXMANN 433 (DEL) Whether even after amendment
    of section 147 with effect from 1-4-1989, a mere
    change in opinion would not confer jurisdiction
    upon Assessing Officer to initiate a proceeding
    under section 147 - Held yes - Whether Circular
    No. 549 allay fears that omission of expression
    reason to believe from section 147 would give
    arbitrary powers to Assessing Officer to reopen
    past assessments on mere change of opinion -
    Held, yes - Whether by reason of section 147 if
    ITO exercises its jurisdiction for initiating a
    proceeding for reassessment only upon mere change
    of opinion, same may be held to be
    unconstitutional - Held, yes - Whether, however,
    if reason to believe of Assessing Officer is
    founded on an information which might have been
    received by Assessing Officer after completion of
    assessment, it may be a sound foundation for
    exercising power under section 147, read with
    section 148 - Held, yes
  • (23.05.07) RAJESH JHAVERI STOCK BROKERS PVT. LTD.
    161 TAXMAN 316 (SC) Intimation under section
    143(1)(a) cannot be treated to be an order of
    assessment. As also, no opinion is expressed
    therein.
  • (08.08.08) BATRA BHATTA COMPANY 174 TAXMAN 444
    (DEL) In the absence of anything new on record
    merely to scrutinize information available in
    return section 148 cannot be resorted and has
    observed that Rajesh Javeri has not diluted this
    legal position and has rather vindicated it.

53
REASONS TO BELIEVE CHANGE OF OPINION (2)
  • (18.01.10) KELVINATOR OF INDIA LIMITED 187
    TAXMANN 312 (SC) Assessing Officer has power to
    re-open, provided there is tangible material to
    come to conclusion that there is escapement of
    income from assessment reasons must have a live
    link with formation of belief
  • 5. O.P CHAWLA 114 ITD 69 (DEL)(TM) The fact
    that the notice of reopening was not prompted by
    a mere change of opinion cannot save the notice
    if the Assessing Officer had no reason to
    believe but had only reason to suspect that
    income chargeable to tax had escaped assessment.
    Secondly, a change of opinion - a re-look or
    review of the facts without any further facts or
    a change in the law - does not exhaust the
    meaning and content of the expression reason to
    believe. It is only one facet or illustration of
    what does not amount to reason to believe.
    There may be several other facets or cases or
    illustrations or fact-situations of what cannot
    be construed as reason to believe. For example,
    there can be a case of reopening based merely on
    suspicion, gossip or rumour. There can be a case
    of a mere pretence and masquerading as a reason
    to believe. A change of opinion on the same facts
    and legal position is only one instance of what
    is not reason to believe. Therefore, merely
    because the instant case for whatever reason was
    not covered by the yardstick of a mere change of
    opinion, it did not automatically follow that it
    fulfilled all the requirements of the expression
    reason to believe.

54
REASSESSMENT PROCEEDINGS - PROCEDURE
  • Reasons to believe not furnished to the
    assessee before completion of assessment, held
    reassessment not valid
  •   CIT v. Videsh Sanchar Nigam Ltd. (2011) 340 ITR
    66 (Bom.)
  •   Where reasons recorded for reopening of
    assessment, though repeatedly asked by assessee,
    were furnished only after completion of
    assessment, reassessment order could not be
    upheld
  • Tata International Ltd. vs. DCIT (2012) 52 SOT
    465
  • Reasons actually recorded by Assessing Officer
    for reopening of assessment were not furnished to
    assessee despite repeated requests and demands -
    In notice, only gist of reasons was furnished to
    assessee - Whether mere gist of reason could not
    be treated as reasons actually recorded as per
    section 148(2) and, as a consequence,
    reassessment proceedings initiated in pursuance
    of said notice were to be set aside

55
REASSESSMENT PROCEEDINGS - PROCEDURE
  • Reassessment framed by the assessing officer
    invalid and to be set aside
  • Without disposing of the objection
  • Rabo India Finance Ltd vs DCIT (2012) 27 taxman
    163(Bom)
  • Order of reassessment passed without disposing
    of objections of assessee would be invalid  
  • IOT Infrastructure and Eng Services Ltd vs ACIT
    (2010) 329 ITR 547 (Bom)
  •   Where Assessing Officer did not deal with
    objections filed by assessee to reopening of
    assessment, in view of decision of Supreme Court
    in GKN Driveshafts (India) Ltd. v. ITO 2003 259
    ITR 19, matter was to be remitted to Assessing
    Officer to pass fresh order on objections raised
    by assessee to proposed reassessment

56
Principles from Sun Engineering Works P Ltd. 64
TAXMAN 442 (SC)
  • On reassessment u/s 147,original assessment is
    not wiped off but it remains.
  • Matters lost in original assessment proceedings
    which have since acquired finality (i.e. against
    which no appeal / rectification application /
    revision application filed) cannot be claimed in
    reassessment proceedings. Hence, expenses
    disallowed / incomes taxed in original
    assessment against which no appeal / revision /
    rectification application filed cannot be claimed
    as allowable / non-taxable in the reassessment
    proceeding u/s 147.
  • Expenses not claimed in original assessment
    cannot be claimed in reassessment proceedings u/s
    147. But, the expenses pertaining to income which
    has escaped assessment can be claimed.
  • U/s 147 the income cannot be reduced below the
    income originally assessed. Similarly, u/s 147
    the losses cannot be assessed above the losses
    originally assessed.
  • Section 147 is for the benefit of revenue and not
    for the benefit of the assessee. Therefore, if no
    return was filed earlier and no assessment was
    made earlier, then u/s 147, the AO cannot compute
    the loss of the assessee.

57
Finance Act 2015 Re-Assessment u/s 147 (w.e.f.
01.06.2015)
Section Existing Proposed
151 r/w 148 Complicated sanctioning mechanism u/s 151 for issuing re assessment notice u/s 148 based on Whether earlier scrutiny u/s 143(3) or 147 Whether notice within or after 4 years from end of relevant AY The rank of AO proposing to issue notice. Simplicity proposed to substitute existing section 151 No notice u/s 148 by AO upto 4 years from end of relevant AY who is below the rank of JCIT unless JCIT satisfied on reasons recorded by AO that its fit case for notice. No notice u/s 148 by AO beyond 4 years from end of relevant AY unless prior approval of CCIT or CIT on reasons recorded by AO that its fit case for notice.
58
SANCTIONS APPROVALS SEC 151 (2)
  • CHHUGAMAL RAJPAL 79 ITR 603 (SC) Whether ITO had
    not even come to a prima facie conclusion that
    transactions to which he referred were not
    genuine transactions and conclusion arrived on a
    vague feeling that they might be bogus
    transactions did not fulfil requirements of
    section 151(2) Held, yes Whether his
    conclusion that there was a case for
    investigating as to truth of alleged
    transactions, was not same thing as saying that
    there were reasons to issue notice under section
    148 Held, yes Whether report submitted by ITO
    under section 151(2) did not mention any reason
    for coming to the conclusion that it was a fit
    case for issue of a notice under section 148 and
    Commissioner had mechanically accorded permission
    Held, yes Whether important safeguards
    provided in sections 147 and 151 were lightly
    treated by ITO as well as by Commissioner and,
    therefore, impugned notice was invalid and had to
    be quashed.
  • VINITA JAIN 163 TAXMANN 325 (DEL) From the
    decision of the Supreme Court in Chhugamal Rajpal
    v. S.P. Chaliha 1971 79 ITR 603, it is clear
    that a mere statement of facts in the form of a
    report is not a substitute for reasons that are
    required to be recorded before issuing a notice
    under section 148. The Supreme Court also noted
    that substance cannot be substituted by form and
    it is in that context that the Supreme Court
    expressed the view that by merely saying Yes,
    the Commissioner did not fulfil the duty cast
    upon him.

59
REASSESSMENT PROCEEDINGS - PROCEDURE
  • Any other income comes to notice during the
    assessment proceeding Expln. 3 to sec. 147
  • CIT v Bestwood Industries Saw mills (2011) 11
    Taxmann.com 278 (Ker)(FB)
  • Whether in course of income escaping assessment,
    if it comes to notice of Assessing Officer that
    any other item or items of income, other than
    item of escaped income for assessment of which
    assessment originally completed was reopened,
    also have escaped from original assessment, he is
    bound to assess such item or items of income also
    in course of reassessment under section 147

60
REASSESSMENT PROCEEDINGS - PROCEDURE
  • If income for which reasons were recorded not
    assessed, any other income cant be assessed
  • CIT vs. Jet Airways (I) Ltd. (2011) 331 ITR
    236(Bom)
  • Whether an Explanation to a statutory provision
    is intended to explain its content and cannot be
    construed to override it or to render substance
    and core nugatory - Held, yes - Whether after
    insertion of Explanation 3 to section 147 by
    Finance (No. 2) Act, 2009, with effect from
    1-4-1989, section 147 has an effect that
    Assessing Officer has to assess or reassess
    income ('such income') which escaped assessment
    and which was basis of formation of belief and if
    he does so, he can also assess or reassess any
    other income which has escaped assessment and
    which comes to his notice during course of
    proceedings - Held, yes - Whether, however, if
    after issuing a notice under section 148, he
    accepts contention of assessee and holds that
    income, for which he had initially formed a
    reason to believe that it had escaped assessment,
    has, as a matter of fact, not escaped assessment,
    it is not open to him to independently assess
    some other income if he intends to do so, a
    fresh notice under section 148 would be
    necessary, legality of which would be tested in
    event of a challenge by assessee

61
REASSESSMENT PROCEEDINGS - PROCEDURE
  • Reassessment Proceedings can be dropped Sec
    152(2)
  • Not filed an appeal or revision application
    against original assessment order and
  • Already been assessed at a higher rate than what
    he would be liable to when escaped income is also
    taken into account
  •  
  • Time limit for completion of reassessment under
    section 153(2)
  •   Notice served
  • Before 1 April 2011 - To be completed within 9
    months from the end of the FY in which notice
    served
  • After 1 April 2011 - To be completed within 1
    year from the end of the FY in which notice
    served  
  •  
  • In case of transfer pricing proceedings
  • Notice served after 1 Apriil 2010 - To be
    completed within 24 months from the end of
    financial year in which notice served
  • If reference to TPO is made before 1.07.2012 but
    order under section 92CA(3) is not made or
  • In case reference is made after 1.07.2012
  • Otherwise, To be completed within 21 months from
    the end of financial year in which notice served

62
  • TDS/Reporting
  • U/s
  • 195(6) Rule 37 BB Form 15 CA15CB
  • ON

63
Amendment to SEC. 195(6) r/w Rule 37BB Form
15CA 15CB
  • Sec 195(1) Any person responsible for paying to
    a non-resident, not being a company, or to a
    foreign company, any interest (not being interest
    referred to in section 194LB or section
    194LC) or section 194LD or any other sum
    chargeable under the provisions of this Act (not
    being income chargeable under the head
    "Salaries")

Before Amendment After Amendment
The person referred to in sub-section (1) shall furnish the information relating to payment of any sum in such form and manner as my be prescribed by the Board The person responsible for paying to a non-resident, (not being a company), or to a foreign compan
About PowerShow.com