Application for Registration of Trusts or Charitable Institutions u/s 80G of Income Tax Act,1961

Sourabh Agarwal
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Application for Registration of Trusts or Charitable Institutions u/s 80G of Income Tax Act,1961

Section 80G of the Income Tax Act, 1961 provides deduction in respect of donations to specified funds, charitable institutions, trusts etc. which are approved u/s 80G. So, trusts and charitable institutions willing to receive donations which can be deductible in the hands of the donor have to get registered u/s 80G of the Act.   

Applicability of 80G on Charitable trusts and Societies.

Section 80G(5) applies to donations to fund or institutions established in India for Charitable purpose and it fulfils the following conditions:

  1. where the institution or fund derives any income, such income would not be liable to inclusion in its total income under the provisions of sections 11 and 12 or clause (23AA) or clause (23C) of section 10. Provided that where an institution or fund derives any income, being profits and gains of business, the condition that such income would not be liable to inclusion in its total income under the provisions of section 11 shall not apply in relation to such income, if—
    • the institution or fund maintains separate books of account in respect of such business;
    • the donations made to the institution or fund are not used by it, directly or indirectly, for the purposes of such business; and
    • the institution or fund issues to a person making the donation a   certificate to the effect that it maintains separate books of account in respect of such business and that the donations received by it will not be used, directly or indirectly, for the purposes of such business.
  2. the instrument under which the institution or fund is constituted does not, or the rules governing the institution or fund do not, contain any provision for the transfer or application at any time of the whole or any part of the income or assets of the institution or fund for any purpose other than a charitable purpose;
  3. the institution or fund is not expressed to be for the benefit of any particular religious community or caste;
  4. the institution or fund maintains regular accounts of its receipts and expenditure;
  5. the institution or fund is either constituted as a public charitable trust or is registered under the Societies Registration Act, 1860 (21 of 1860), or under any law corresponding to that Act in force in any part of India or under section 8 of the Companies Act, 2013 , or is a University established by law, or is any other educational institution recognized by the Government or by a University established by law, or affiliated to any University established by law, or is an institution financed wholly or in part by the Government or a local authority;
  6.  in relation to donations made after the 31st day of March, 1992, the institution or fund is for the time being approved by the Commissioner in accordance with the rules made in this behalf;
  7. where any institution or fund had been approved under clause (vi) for the previous year beginning on the 1st day of April, 2007 and ending on the 31st day of March, 2008, such institution or fund shall, for the purposes of this section and notwithstanding anything contained in the proviso to clause (15) of section 2, be deemed to have been,—
    • established for charitable purposes for the previous year beginning on the 1st day of April, 2008 and ending on the 31st day of March, 2009; and
    • approved under the said clause (vi) for the previous year beginning on the 1st day of April, 2008 and ending on the 31st day of March, 2009;
  8. The institution or fund prepares such statement for such period as may be prescribed and deliver or cause to be delivered to the prescribed income-tax authority or the person authorized by such authority such statement in such form and verified in such manner and setting forth such particulars and within such time as may be prescribed: Provided that the institution or fund may also deliver to the said prescribed authority, (a) correction statement for rectification of any mistake or to add, delete or update the information furnished in the statement delivered under this sub-section in such form and verified in such manner as may be prescribed; and
  9. the institution or fund furnishes to the donor, a certificate specifying the amount of donation in such manner, containing such particulars and within such time from the date of receipt of donation, as may be prescribed.(* applicable from 1.04.2021)

Application for Grant of approval u/s 80G

The institution or trust shall make an application in the prescribed form and manner to the PCIT or CIT, for grant of approval:

  • where the institution or trust is approved under clause (vi) (as it stood immediately before its amendment by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020), within three months from the 1st day of April, 2021;
  • where the institution or trust is approved and the period of such approval is due to expire, at least six months prior to expiry of the said period;
  • where the institution or trust has been provisionally approved, at least six months prior to expiry of the period of the provisional approval or within six months of commencement of its activities, whichever is earlier;
  •  in any other case, at least one month prior to commencement of the previous year relevant to the assessment year from which the said approval is sought.

How to apply for Grant of approval u/s 80G?

  1. An application for approval under section 80G(5) , the institution or fund (hereinafter referred to as ‘the applicant’) shall be made in the following Form, namely:-
    • Form No. 10A in case of application under clause (i) or clause (iv) of first proviso to subsection (5) of section 80G to the PCIT or CIT authorized by the Board; or
    • Form No. 10AB in case of application under clause (ii) or clause (ii) of first proviso to subsection (5) of section 80G to the PCIT or CIT authorized under the said proviso.
  2. The application shall be accompanied by the following documents, as required by Form Nos. 10A or 10AB, as the case may be, namely:—
    • where the applicant is created, or established, under an instrument, self-certified copy of the instrument.
    •  where the applicant is created, or established, otherwise than under an instrument, self-certified copy of the document evidencing the creation or establishment of the applicant.
    • self-certified copy of registration with Registrar of Companies or Registrar of Firms and Societies or Registrar of Public Trusts, as the case may be.
    • self-certified copy of registration under Foreign Contribution (Regulation) Act, 2010, if the applicant is registered under such Act.
    • self-certified copy of existing order granting registration under section 80G(5);
    • self-certified copy of order of rejection of application for grant of approval under section 80G(5), if any.
    •  where the applicant has been in existence during any year or years prior to the financial year in which the application for registration is made, self-certified copies of the annual accounts of the applicant relating to such prior year or years (not being more than three years immediately preceding the year in which the said application is made) for which such accounts have been made up.
    • Note on the activities of the applicant.
  3. Form Nos. 10A or 10AB, as the case may be, shall be furnished electronically,
    • under digital signature, if the return of income is required to be furnished under digital signature;
    • through electronic verification code in a case not covered under above point.
  4. Form Nos. 10A or 10AB, as the case may be, shall be verified by the person who is authorized to verify the return of income under section 140, as applicable to the applicant.

Recent Important Update:

The CBDT (Central Board of Direct Tax) has issued Notification No. 19/2021 dated 26th March, 2021 prescribing the procedure for Registration including re-approval / revalidation of existing Tax Exemption Registrations of Trust or Institutions. All the existing Trusts or Institution registered u/s. 10(23C) / 12A / 80G have to Re-Register with the Income Tax Department. The new Rules and Forms will be applicable from 1stApril, 2021 and all charitable Trusts and Institutions already registered u/s. 12A or 12AA or 10(23C) and having 80G certificate must apply for re-approval/revalidation of their registration before 30thJune, 2021.

How RSA Consultants can help?

We are team of experienced Chartered Accountants, Company Secretaries and Business Consultants and having experience of working with many Trusts and NGO’s and understands the needs of such organization. We will fill out the 80G application and submit it on your behalf as well as Income Tax Department and will give you absolute clarity on the process to set realistic expectations. You may explore more at 

https://www.itatorders.in/products/80g-registration

9 Must-Know Startup acronyms

Priya kejriwal
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9 Must-Know Startup acronyms

The world of startups is filled with new terminology and not being able to understand the can leave a bad impression and limit your network growth. Therefore, we have created this list of 9 Must-Know Startup acronyms that you need to add to your vocabulary today!

1. MoM or WoW or YoY

Month-over-month (MoM)

MoM growth shows the change in the value of a specific metric as a percentage of the previous month’s value.

Month-over-month growth is often used to measure the growth rate of monthly revenue, active users, number of subscriptions, or other key metrics.

Year-Over-Year(YOY)

YoY growth calculation compares a statistic for one period to the same period the previous year. The year-over-year growth rate calculates the percentage change during the past twelve months.

To calculate month-over-month growth for a single month, simply take the difference between this month’s total number of users and last month’s total number of users, and then divide that by last month’s total.

2. GTM

Go to Market. This is a description of strategy – and again this is usually written.

A GTM is usually how a company intends to enter the market, i.e. what marketing strategy is going to lead to which new customers signing up (and paying).

3. CRM

CRM means customer relationship management and is usually followed by software. Like other types of enterprise software (for example, ERP (Enterprise Resource Planning), BI (Business Intelligence), etc.).

CRM software is productivity software that is utilized by companies to keep track of their customer relationships.

Often this software doubles as software that tracks potential customers and people that are in a sales campaign (often called leads).

4. SaaS

SaaS (Software as a Service) – pronounced like “sass”. SaaS software and its brethren (Infrastructure as a Service (IaaS), Platform as a Service (PaaS)) are tools that are usually built online and paid in a recurring fashion (often monthly).

Examples of SaaS platforms include Microsoft Office 365 and most CRM software platforms.

5. VC

VC is tricky because it means a class of people – venture capitalists or an individual within the class of people – an individual venture capitalist – or it could mean the firm that represents this group – as in a VC firm, shortened to just VC.

In many ways this reminds us of LOL which almost always means “laughing out loud” but in rare cases has been shortened by an elder to “lots of love”.

While not generally confusing, VC has a variety of meanings that shift around subtly and so it is important to track all iterations.

6. ARR

Annual recurring revenue and its close cousin MRR – monthly recurring revenue also can be a little tricky but are popular startup acronyms.

The same acronym ARR can mean annual run rate (or in some weird finance instances Annual Rate of Return) – and this is not the same thing as recurring revenue.

Annual recurring revenue means revenue that is signed up to recur every year. So, for example, I might sell a SaaS product to a client that auto-renews a year from now. This would be considered ARR (annual recurring revenue).

Here’s where this gets tricky my run rate is derived from my MRR (monthly recurring revenue) – but it is a forecasted amount based on my current amount today and my projection of that growth continuing.

This is very different – one is based on annual contracts and one is based on forecasts of growth.

7. CAC

Customer Acquisition Costs – pronounced “kak” like “hack” but with a “k” sound. Acquiring customers is critical to any startup, but understanding how (which channels) and at what price (which is what the CAC is used to abbreviate) the customer is being acquired is really important.

This number can be hard for certain types of companies to calculate – but generally, it is total acquisition costs (generally marketing and sales expenses (minus discounts)) divided by the number of new customers.

This allows a firm to understand its unit value.

8. LTV

Lifetime Value – many firms have clients that will pay for a period of time and then leave (called churn in many software industries).

Understanding the length of time that an average customer stays with a firm and what the average customer spends per month (or year) allows the firm to create a lifetime value calculation.

This is very useful for companies that have regular churn levels because it isolates the length of time and the unit metrics for a specific customer.

9. ARPU

Average Revenue Per Unit. This is a critical one and is related to other unit measurements but it essentially measures the average price paid by customers against the number of things that they are buying.

Particularly for companies that are selling products, ARPU is a great way to keep track of customer trends and product-related pieces.

For example, let’s imagine that I run an e-commerce site that sells shoes. I sell a $50 pair and a $100 pair – my revenue is $150, and my ARPU is $75.

Whereas if I sell 50 $1 pairs and 1 $100 pair, my revenue is still $150, but now my ARPU is $2.94.

These are very different businesses. This unit measurement is a great way to understand a firm’s financial tension between commodity and specialized.

This brings us to the end of our list. These startup acronyms are enough to make sense of your startup initially and with your growth, you will find more relevant terms.

Did you know that if your startup is registered with startup India you can get amazing benefits including a community of entrepreneurs? Check out our article on why you should register with startup India and how it is beneficial for you.

Do You Really Need Professional’s Help While Filing Your ITR?

Rishabh Jain
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Do You Really Need Professional’s Help While Filing Your ITR?

When March approaches every year, we tend to focus on few compliances that we never thought of during the whole year and filing your ITR and the confusion of discussing it with professionals or not is the biggest issue we face.

Income Tax Return filing is the duty of every individual and not only it’s the duty it is the moral obligation of everyone towards the people and Govt. of this Country to disclose their earnings and pay taxes as per the applicable slabs.

But what we do is we never thought of it as a duty rather a burden that we all have to go through once in every year and for that, we have to pay certain fees to a Chartered Accountant or some other professional.

Income Tax Department in its report discloses that 5.95 Crore ITR’s were filed for F.Y. 2019-20 till January 10 this year, and we live in a country of more than 130 Crore people and still only 5 % people (Approx.) file their ITR.

All the progress India is making is because people like you and me file their ITR and pay taxes to Govt. and Tax payment govt. receives is used for creating all the Public infrastructure like Schools, Hospitals, Toilets, Community Centres, Parks, Railway Stations, Roads, Metros, etc.

We all blame Govt. how they’re not using the public money in the right way, and the same people who criticize they don’t file their ITR, so they’re not a part of Nation building instead they’ll use all the facilities for free, This is known as “Free Rider Problem” where people who don’t pay for services stills gets to enjoy the services on other’s payments.

Now the main question arises that should you go to a professional like Chartered Accountant for filing your ITR?

The answer is simple, What would you do if you have Stomach Ache? You’ll go see a doctor right? But when it comes to Taxation we become the experts and do what we don’t know, later on when we get notices from the Income Tax Department we all rush to Chartered Accountants for their help. That’s an ill mentality we treat the professionals like last resort instead we should hire them for Tax Planning and Business and Financial Planning.

Why hire professionals? You trust doctors because they got an MBBS degree from Govt. but you don’t trust a Chartered Accountant’s advice when he is one of the most knowledgeable people in Taxation and Accounting in India. They are certified by a body set up by the Act of parliament and they’re the doctors of your Finances.

Professionals are there to help you plan your financial future and create strategies as per your business needs and they’ll share their knowledge which is acceptable by law and will help you grow your business and help you invest your money in the right direction. Every professional has a different approach so you can’t judge people based on their working style rather on their performance and the results they get you.

The conclusion we reached is that Filing ITR is our ethical responsibility and consulting a professional before filing ITR is a remedy we take before any accident. It’s not a burden on people rather it’s a Nation-building process we all should take part in and Govt. won’t take your money if you disclose It to the IT Department.

There’s a saying “No matter how bad a child is, he is still good for a tax deduction”

SC : “Public scrutiny of the court process remains a vital principle for the functioning of democracy.” Does this mean no more Faceless hearing?

Tithi Shah
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SC : “Public scrutiny of the court process remains a vital principle for the functioning of democracy.” Does this mean no more Faceless hearing?

With the announcement of recent budget, the proposal in respect of introduction of the scheme of Faceless ITAT has been a point of debate since there are mixed opinions regarding the same The Tribunal being a final fact-finding authority, a personal hearing will afford members a better understanding of the perspective of the taxpayer to appreciate the finer nuances of the tax law and its applicability to a case. 

However, recently the Hon’ble Supreme Court in their recent judgement of The Chief Election Commissioner of India Vs. M.R Vijayabhaskar & Ors. held that in-camera proceedings in court must only be held in exceptional category cases involving child abuse, matrimonial proceedings etc. All other proceedings must be in open court and should be available in public domain.

This signals inclination of Tribunal hearing to continue in-person rather than shift to faceless since open court proceedings ensure that judicial process is subject to scrutiny and transparency and accountability is maintained. The above mentioned judgement can be summarized as under:

The Chief Election Commissioner of India Vs. M.R Vijayabhaskar & Ors.

Civil Appeal No. 1767 of 2021

Courts must be open both in the physical and metaphorical sense. Save and except for in-camera proceedings in an exceptional category of cases, such as cases involving child sexual abuse or matrimonial proceedings bearing on matters of marital privacy, our legal system is founded on the principle that open access to courts is essential to safeguard valuable constitutional freedoms. The concept of an open court requires that information relating to a court proceeding must be available in the public domain.

Citizens have a right to know about what transpires in the course of judicial proceedings. The dialogue in a court indicates the manner in which a judicial proceeding is structured. Oral arguments are postulated on an open exchange of ideas. It is through such an exchange that legal arguments are tested and analyzed. Arguments addressed before the court, the response of opposing counsel and issues raised by the court are matters on which citizens have a legitimate right to be informed. An open court proceeding ensures that the judicial process is subject to public scrutiny. Public scrutiny is crucial to maintaining transparency and accountability. Transparency in the functioning of democratic institutions is crucial to establish the public‘s faith in them. In Mohammed Shahabuddin vs State of Bihar (2010) 4 SCC 653 , the concurring opinion noted:

“… even if the press is present, if individual members of the public are refused admission, the proceedings cannot be considered to go on in open courts…an ―open court‖ is a court to which general public has a right to be admitted and access to the court is granted to all the persons desirous of entering the court to observe the conduct of the judicial proceedings.”

There are multiple ways in which an open court system contributes to the working of democracy. An open court system ensures that judges act in accordance with law and with probity.

Public scrutiny fosters confidence in the process. Public discussion and criticism may work as a restraint on the conduct of a judge. In his dissenting opinion in Naresh Shridhar Mirajkar vs State of Maharashtra (1966) 3 SCR 744, hereinafter referred to as ―Mirajkar , Justice M Hidayatullah (as the learned Chief Justice was then), observed how an open court paves the way for public evaluation of judicial conduct:

“129. […] Hearing in open court of causes is of the utmost importance for maintaining confidence of the public in the impartial administration of justice: it operates as a wholesome check upon judicial behaviour as well as upon the conduct of the contending parties and their witnesses.”

Hence, while in camera proceedings may be necessary in certain exceptional circumstances to preserve countervailing interests such as the rights to privacy and fair trial, for instance, in a sexual assault case, public scrutiny of the court process remains a vital principle for the functioning of democracy.

Spending funds for setting up makeshift Hospitals, temporary COVID care facilities eligible as CSR activity #maskandmassappeal

Priya kejriwal
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Spending funds for setting up makeshift Hospitals, temporary COVID care facilities eligible as CSR activity #maskandmassappeal

Coronavirus crisis is intensifying with each passing day. Till you get vaccinated masks seem to be the only effective way to protect oneself from the deadly virus. Wearing masks properly, maintaining social distancing and good personal hygiene are what needs to be followed by everyone to keep the virus in check. 

The exponential jump in daily new cases has led to shortage of beds, medical oxygen and drugs like remdesivir, while the vaccination effort is also seen slowing down due to constraints of manufacturing capacity.

The second flow of Covid-19 is challenging more lives, and Finance Minister Nirmala Sitharaman has prompted the private sector for assistance in this predicament.

Government and private hospitals are running out of beds, oxygen, and medical personnel, and also turning critically ill patients away. In this situation, the Ministry of Corporate Affairs (MCA) published a circular saying that if a company sets up temporary Covid-19 hospitals and facilities, it is acceptable to be deemed as a CSR activity. It is further clarified by government that spending for Corporate Social Responsibility (CSR) funds will be eligible CSR activity under items of Schedule VII of the Companies Act, 2013 relating to promotion of health care, including preventive health care and disaster management. 

The Ministry of Corporate Affairs (MCA) clarified this by the following notification http://www.mca.gov.in/Ministry/pdf/GeneralCircularNo5_22042021.pdf on April 22,2021.

Under the companies law, certain class of profitable entities are required to spend at least 2 per cent of their three-year annual average net profit towards Corporate Social Responsibility (CSR). This incentive from government can be advantageous to all citizens of the country.

Various Central Ministries/ Departments/ PSUs have already dedicated COVID hospitals and COVID beds since the beginning of this pandemic and have also committed to continue doing so.

Further, in view of the ongoing work-from-home mode of working, one may have some vacant buildings at your disposal. One can consider converting these vacant office buildings to temporary COVID Care facilities with either isolation beds or a combination of isolation and oxygen beds to cater to rapidly increasing COVID caseload in many parts of the country, some of which may lie in the vicinity.

The government is looking for increased involvement of corporates in India to tackle the second wave of the pandemic, which has led to cases reaching record levels. 

#Maskandmassappeal is a hashtag to be spread via this blog to all the citizens of the country to stay strong, safe and main proper hygenie and social distancing.

Mask appeal highlights the fact that wearing a mask (nowadays when two) can protect us from this dangerous wave, while it is not about just wearing a mask, it is also about wearing it properly.

So, according to the World Health Organisation (WHO), masks are effective only when worn properly. It advises people to follow these steps to protect oneself from COVID-19 using masks:

  • Properly wash hands before touching the mask
  • Wear only clean, breathable face masks- medical or fabric. Do not re-wear the same mask as it could expose the person to contaminants
  • Put on the mask, holding it by the ear loops and not the fabric. It should fit snugly against the sides of the face leaving no open spaces
  • Press down on it over your nose for a more comfortable fit
  • Make sure that nose, mouth and chin are covered
  • After putting the mask on, one must not touch it again until it’s time to take it off
  • Wash hands immediately after removing and disposing of the mask

While wearing a mask is an important measure of precaution against COVID-19, however, WHO also advises people to maintain at least one metre distance from others and wash hands frequently and thoroughly, even while wearing a mask.

Mass appeal highlights the fact that every individual/Companies should contribute to the society in this uncertain time. Individuals should try to help as much as possible to this time of need by supporting there family, friends or any person in need and Companies should come up with donation in form of CSR activities.

Thus #Maskandmassappeal is a request/appeal to all citizens to stay home, stay safe and stay strong. At the end of the day, the goals are simple: Safety and security of all and these two factors must be the highest law for India today.

Our prompt and targeted efforts will certainly help in providing the much needed relief to the citizens during this difficult time. So Let’s stay together and fight the second wave of Covid-19. An act of kindness is never wasted!

Lastly, Near, far, wherever you are……….make sure you’re practicing social distancing!

Don’t forgot the share this blog and spread our hashtag #Maskandmassappeal

I-T Department issues Rs 17,061 CR of refunds to Taxpayers

Priya kejriwal
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I-T Department issues Rs 17,061 CR of refunds to Taxpayers

The Income Tax Department on 12th May,2021 said it has issued over Rs 17,061 crore of refunds to more than 13 lakh taxpayers so far this fiscal year. 

Of this, personal income tax refunds worth Rs 5,575 crore were issued in over 12.71 lakh cases and corporate tax refunds of Rs 11,486 crore were issued to 29,592 taxpayers  between 1st of April to 10th of May 2021.

The same was conformed by Income Tax Department by its tweet post.

Since, Financial year 2020-21 has been a year full of challenges for India due to the COVID-19 pandemic. The Government has, from time to time, come out with several initiatives to mitigate the economic hardship caused to the people due to the effect of the pandemic.

It did not specify for which financial year the refunds pertain to. However, it is believed that the refunds are for tax returns filed for 2019-20. 

Further, the ministry said that to provide immediate relief to the taxpayers, both individuals and business entities, the Government has issued income tax refunds in the majority of the pending cases with alacrity.

“It has been the endeavour of the Government to come out with various measures to ease the economic fallout of the pandemic and in line with the same, CBDT has issued pending refunds expeditiously,” the ministry added. 

Have you received your refund? Go check it now!

Startup India Registration: How beneficial is it for your business?

Tithi Shah
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Startup India Registration: How beneficial is it for your business?

Launched on 16th January 2016, the Startup India Initiative has rolled out several programs to support entrepreneurs, build a robust startup ecosystem, and transforming India into a country of job creators instead of job seekers.

These programs are managed by a dedicated Startup India Team, which reports to the Department for Industrial Policy and Promotion (DPIIT).

Startup India was set up to provide handholding support to startup ventures and streamline their incentive disbursals under the DPIIT.

The idea is to provide an enabling environment for startups to flourish and lure investments. The initiative commenced in April 2016, with the operationalization of the Startup India Hub, the online portal providing multiple offerings under Startup India and connecting aspirants to other vital ecosystem builders.

Also, the scope of definition was broadened to include scalable business models with a high potential of employment generation or wealth creation.

Additionally, the requirement of a letter of recommendation from an incubator/ industry association was also removed to avail benefits offered under the initiative.

Currently, there is at least one recognized startup in each of the States and UTs. The startups recognized until February 2020 span across 54 industrial sectors with a maximum number of startups registered under IT services and Healthcare & Life sciences followed by the education sector.

DPIIT-RECOGNISED STARTUPS ARE ELIGIBLE FOR THE FOLLOWING BENEFITS

  • Intellectual Property Rights (IPR) benefits
  • Relaxation in public procurements norms
  • Self-certification under Labour & Environment laws
  • Fund of Funds for Startups (FFS)
  • Faster exit for Startups
  • Seed Fund Scheme

DPIIT-RECOGNISED STARTUPS MAY APPLY TO IMB FOR THE FOLLOWING BENEFITS

Startups incorporated on or after 1st April 2016 can apply for income tax exemption. The Inter-Ministerial Board validates the innovative nature of the business for granting Income Tax Benefits and is constituted by representatives from DPIIT, DBT, and DST.

Income Tax exemption for 3 out of 10 years

The recognized startups that are granted an Inter-Ministerial Board Certificate are exempted from income tax for a period of 3 consecutive years out of 10 years since incorporation.

Exemption for the purpose of clause (VIIB) of sub-section (2) of section 56 of Income Tax Act,1961

A DPIIT recognized startup is eligible for exemption from the provisions of section 56(2)(viib) of the Income Tax Act. The Startup has to file a duly signed declaration in Form 2 to DPIIT {as per notification G.S.R. 127 (E)} to claim the exemption from the provisions of Section 56(2)(viib) of the Income Tax Act.

Best Resources with Startup India Registration Portal

Startup India provides free resources to startups to help them scale faster, better, and stronger. The Startups recognized under the scheme are offered various free resources of which some of them are mentioned here-

Pro Bono Services

$5.8M Worth of value benefits is offered. The Scheme has collaborated with leading corporates and startups and others to provide services of legal support, build an app, use cloud credits, cloud telephony services, and many more.

Blockchain-based Certificate Verification Platform

The Department for Promotion of Industry and Internal Trade (DPIIT) has launched a Blockchain-based Certificate Verification Platform to enable instant access and verification of the certificates issued to recognized startups through the Startup India Portal.

The platform can be utilized by Government Departments, PSUs, Banks, and Investors to verify the authenticity of the information submitted by startups.

Networking and Discussion

Members of the startup ecosystem – startups, investors, mentors, incubators, accelerators, and government bodies can connect on the online forum of the Startup India portal.

The platform provides the ecosystem members with the opportunity to discuss, express, and opine on the forum through discussion threads, blogs, and one-to-one messaging.

State’s Startup Policies

Startup India presents a list of 30 State Government policies that offer benefits to startups. Startups and entrepreneurs across these states can access the policy documents, website links, and contact details of the respective nodal agencies.

Tools and Templates

The Portal offers a wide range of templates ranging from lease agreements, employment contracts, deeds, NDAs, etc. freely available in multiple Indian languages that will allow the startups to focus on what is important to the business.

How RSA Consultants can help?

We are a team of experienced Chartered Accountants, Company Secretaries, and Business Consultants and have experience working with many Startups and understanding the needs of such an organization.

We will fill out the application and submit it on your behalf with DPIIT as well as Income Tax Department and will give you absolute clarity on the process to set realistic expectations. You may explore more at ITAT Orders.

CBDT extends various due dates to provide relief to taxpayers in view of COVID – 19: [Circular No. 9 of 2021 in F. No. 225/49/2021-ITA-II]

CA Yash Kapadia
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CBDT extends various due dates to provide relief to taxpayers in view of COVID – 19: [Circular No. 9 of 2021 in F. No. 225/49/2021-ITA-II]

In view of the adverse circumstances arising due to the severe Covid-19 pandemic, the CBDT in exercise of its power under section 119 of the Income Tax Act, 1961 provided relaxation in respect of the following compliances:

Particulars Extended Due Date
The Statement of Financial Transaction (SFT) for FY 2020-21 30th June, 2021
The Statement of Reportable Account for the CY 2020 30th June, 2021
TDS Return – Q4 of FY 2020-21 (26Q & 24Q) 30th June, 2021
The Certificate of TDS in Form No. 16 – Q4 of FY 2020-21 15th July, 2021
TDS/TCS Book Adjustment Statement in Form No. 24G for the Month on May 2021 30th June, 2021
TDS Return by trustee of an Approved Superannuation Fund for FY 2020-21 30th June, 2021
Statement of Income paid or credited by an investment fund to its unit holder in Form No. 64D for the FY 2020-21 30th June, 2021
Statement of Income paid or credited by an investment fund to its unit holder in Form No. 64C for the FY 2020-21 15th July, 2021
Return of Income for AY 2021-22  (original due date – 31st July, 2021 u/s. 139(1)) 30th September, 2021
Tax Audit Filing Due Date for FY 2020-21 31st October, 2021
Audit Report of person who entered into International Transaction or Specified Domestic Transactions u/s. 92E for FY 2020-21 30th November, 2021
Return of Income for AY 2021-22  (original due date – 31st October, 2021 u/s. 139(1)) 30th November, 2021
Return of Income for AY 2021-22  (original due date – 30th November, 2021 u/s. 139(1)) 31st December, 2021
Revised or Belated Return of Income for AY 2021-22 u/s. 139(5) and 139(4) respectively (original due date – 31st December, 2021) 31st January, 2022

The said circular is available on www.incometaxindia.gov.in

Relaxation granted by MCA due to second wave of Covid-19

Priya kejriwal
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0
Relaxation granted by MCA due to second wave of Covid-19

Circular-1: Maximum Gap between two Board Meetings under section 173 of the Companies Act, 2013. 

MCA has extended a gap between the two board meetings by 60 days for the first two quarters of Financial Year 2021-22. Accordingly, the gap between the two consecutive Board Meetings may extend to 180 days during the quarter April to June 2021 and July to September 2021, instead of 120 days as per Section 173 of the Companies Act, 2013.

The circular can be accessed at http://www.mca.gov.in/Ministry/pdf/GeneralCircularNo8_03052021.pdf

Circular-2: Relaxation of filing forms for Creation and Modification of charge

MCA has provided relaxation in respect of filing of forms of creation and modification of charge between 01.04.2021 to 31.05.2021 (both days inclusive). As per provisions of Section 77 of Companies Act, 2013 form CHG-1 and CHG-9 relating to Creation and Modification of Charge need to be filed in a maximum of 120 days from the date of creation or modification of charge.

The Circular shall not apply in case:

-When the form has already been filed before the date of issue of this Circular.

-The timeline for filing the form is already expired prior to 01.04.2021.

-Filing of form CHG-4 for the satisfaction of charge.

The circular for modification of charges can be accessed at https://www.mca.gov.in/Ministry/pdf/GeneralCircularNo7_03052021.pdf

 Circular – 3: Relaxation in additional fees for filing of form after the due date

As per this circular, if the due date of any form (except CHG-1, CHG-4, and CHG-9) falling between 1st April 2021 to 30th May 2020 then those forms can be file without additional fees till 31st July 2021.

 S.No.FormsPurpose of the formLast DateExtended Due Date
1MSME-1For reporting dues to MSME exceeding 45 days, if any on a half-yearly basis30/04/202131st July 2021
2LLP Form-11Annual Return to be furnished30/05/202131st July 2021
3DPT-3Return of Deposits30/06/202131st July 2021
4Form CFSSApplication for issue of immunity certificate under the Companies Fresh Start Scheme (CFSS), 202030/06/202131st July 2021
5FC-4Annual Return of Foreign Company30/05/202131st July 2021

This has provided great relief to all the Companies and LLPs registered under the Companies Act, 2013 & Limited Liability Partnership Act, 2008 by the MCA.

The circular can be accessed at https://www.mca.gov.in/Ministry/pdf/GeneralCircularNo6_03052021.pdf

No addition can be made in respect of completed assessments if no incriminating material is found during the course of search.

Tithi Shah
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No addition can be made in respect of completed assessments if no incriminating material is found during the course of search.

The DCIT Vs. M/s.Creative Trendz Pvt. Ltd.

[I.T(SS)A No’s.272/AHD/2016 & 273/AHD/2016]

Facts of the case

The assessee is a company engaged in the business of embroidery of cloth and job work. The assessee filed its Return of Income for year for A.Y 2009-10 on 15.09.2009 declaring total income of Rs.1,85,10,810/-. The Return of Income was processed and accepted under section 143(1) of the Act. A search action under section 132 was carried out on 18.02.2014 in the premises of the assessee. Consequent upon the search, a notice under section 153A dated 28.11.2014 was issued to the assessee to file Return of Income for the year under consideration. The Assessing Officer after serving notice under section 143(2) of the Act proceeded for re-assessment of income furnished in response to notice under section 153A of the Act. During the assessment the AO issued notice to the assessee vide notice dated 16.03.2016 as to why the share capital of Rs.3.13 crore raised during the A.Y. 2009-10 and Rs.3.57 crore in A.Y. 2010-11 should not be treated as unexplained cash credit. The assessee in its reply dated 23.03.2016 stated that assessment completed under section 143(3) cannot be interfered without any incriminating material found during the course of search.

The AO did not accept the contention of the assessee and concluded that the assessee had failed to pass the test as required under section 68 of the Act to prove the identity of shareholders genuineness of the transaction and credit worthiness of the creditor. The AO made addition of Rs.3.13 crore as unexplained cash credit.

AR’s Arguments

The Ld. AR for the assessee submitted that the assessment
for the year was completed under section 143(3) and no
incriminating material was found during the search related with
the share application money. The investor company has sufficient
share capital and reserve funds available with them. The AR further submitted that the AO in the entire assessment, nowhere mentioned that any incriminating material was found during the search on 18.02.2014. He further submitted that “It is settled law by various High Courts and Hon’ble Supreme Court’s decision that no addition can be made in unabated assessment in absence of incriminating material in relation to the assessment year.” Further, no incriminating material related with share application money was recovered in the search carried at the premises of the assessee, thus, the AO was not justified to make addition under section 68 of the Act against the assessee. The Ld. AR relied on the judgement of Hon’ble Delhi High Court in the case of Kabul Chawla [2015] 93 CCH 0210 (Delhi HC) and the decision of Special Bench of All Cargo Global Logistics Ltd. vs. DCIT 147 TTJ 0513 (SB) which has been upheld by the Hon’ble Bombay High Court, in CIT vs. Continental Warehousing corporation [2015] 58 taxmann.com 78 (Bom) and held that in absence of incriminating material unearthed during the search, the addition is not permissible.

DR’s Arguments

The Ld. DR for the Revenue had submitted that as per explanation in section 153A (d), the AO has power to assess or re-assess the total income in respect of six assessment years. Nowhere is it mentioned that AO cannot make assessment under section 153A if not incriminating material is found.

Findings of the case

The Ld. Tribunal held that the Ld. DR failed to bring any fact that assessment for the year under consideration was pending at the time of search on 14.02.2014 of that the issue of share capital was not the subject matter in the assessment was not reported while filing the Return of Income in the assessment year under consideration. The Ld. DR referred the explanation attached with section 153A that the AO has power to assess or re-assessing total income in respect of each assessment year falling within six assessment years. There is no dispute regarding statutory provision in the Act. However, the Hon’ble Bombay Delhi High Court has laid down Law that no addition in absence of incriminating material can be made in respect of assessment which has become final if no incriminating material is found during the search. The Ld. DR failed to bring any contrary fact to our notice that any incriminating material was found during the search. No contrary law is brought to our notice. Therefore, the Ld. Tribunal have no option except to affirm the order to Ld. CIT(A) and hence, the appeal of the revenue was dismissed.

Find more such judgments on https://www.itatorders.in/

 

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