My Beloved Members,

THANKSGIVING

AND

PLEASE GRANT ME LEAVE TO ENABLE THE NEW PRESIDENT TO TAKE CHARGE OF PRESIDENT’S OFFICE FOR NEW YEAR 2016-17

‘Time and Tide’ doesn’t wait for anybody. So, it is time for me to lay down the office of the President of our august Federation for my successor. Parting company with fellow dear brothers is always painful. But you have to bear the same because the glass of life is a mixture blended with joy and pain. Hence, by sharing the same, everyone’s life goes on.

I am aware of the fact that due to my prolonged illness during the term of my office, I could not devote my time and energy for discharging the responsibilities of the Federation. However, due to decentralised structure of services of our Federation into five Zonal Committees and the supervisory role of the National Committee, they ably shared the vacuum of my absence and gave me courage and blessings to overcome my illness. And with God’s blessings too the ship of my life sailed smoothly.

I am therefore extremely grateful and indebted to these committees for sharing the workload efficiently in a time bound manner. Thus, the Federation in time of difficulty proved that in the absence of a main leader, it can ably carry out the services as well as of National Integration of Tax Professionals.

The motto of the Federation is to achieve Excellence without compromising on Ethics and Education. I am confident that my successor too will follow the footprints of our past Presidents and make an honest attempt to develop a strong Tax Bar for our country, keeping in mind the ensuing GST Regime and take forward the Bar to compete in International Tax Practice.

Apart from the above, through this monthly message, I have always maintained that tax practice is our bread and butter, but that itself is not enough to purposefully live our life. Hence, other than tax, I had focused your kind attention upon a number of issues affecting our life. Now, in this parting message, I would like to share with you a very important issue viz. ‘Climate Change’ which has affected the entire world. Recently, in Paris Conference, world leaders deliberated the ill effects of climate change on our life, but could not reach accord how to resolve the said issue, said the Green Groups countries. To illustrate the gamut of this problem, please note the following facts – how clean air is vanishing and pollution monster across the world is replacing the same.

(a) In 1960 decade, globally, carbon discharged in the air was 4.5%. In 2010, it increased to 5.9% as per information given by World Trade Organisation. Meantime, in the following five years, it must have further increased.

(b) China to achieve accelerating rate of growth, increased its use of coal so much so that its carbon discharged in the air reached 48% to achieve its export target of goods. At present, out of the 100% world discharge of carbon in the air, 70% discharge is accounted for by China itself.

(c) In America to generate electricity, 40% electricity is obtained by burning coal of which entire production of coal is controlled by politicians only.

(d) Thus, the politicians and businessmen across the world are fully responsible for causing climate pollution and pure air, by and large, is not available for human body across the world. In this context, you may have read that Delhi is the most polluted city in India followed by Mumbai.

Against the above background, I appeal to the incoming President, to consider whether other problems, such as the above, may be given due attention by the Federation.

I take this opportunity and express my sincere thanks to all the stakeholders, particularly the past Presidents and the Journal Committee Members including Chief Editor, in running the Federation and co-operating with me during the term of my office. In particular, I must thank the office staff of the Federation’s office at Mumbai, who have always put in lot of hard work in running the office and thereby efficiently serving the members across the country.

By praying motherland “Jai Hind!” I take your leave!!

With best wishes and warmest regards,

J. D. Nankani
National President

STEP towards ease of doing Business

To give the Indian economy boost the Hon’ble Prime Minister Mr. Narendra Modi had announced one of the avowed object “Ease of doing business”. To fulfil the above object various decisions have been taken by the Government of India and Central Board of Direct Taxes.

Ministry of Finance, Government of India has set up a committee with a view to simplify the provisions of the Income-tax Act, 1961 headed by Justice R. V. Easwar, (Retd.), former judge, Delhi High Court and former President ITAT. The terms of reference of the Committee are as follows:

i) To study and identify the provision/phrases in the Act which are leading to litigation due to different interpretations;

ii) To study and identify the provisions which are impacting the ease of doing business;

iii) To study and identify the areas and provisions of the Act for simplification in the light of the existing jurisprudence;

iv) To suggest alternatives and modifications to the existing provisions and areas so identified to bring about predictability and certainty in tax laws without substantial impact on the tax base and revenue collection.

As per press release dated October 27, 2015, the first batch of recommendation would have to be submitted before January 31, 2016 to the said Committee.

In pursuance of the said press release we have submitted representation to the said Committee, suggesting many amendments to the Act.

Further, CBDT vide Circular No. 21/2015 [F. No. 279/misc. 142/2007 – ITJ (Pt)] dated December 10, 2015 has revised monetary limits for filing of appeals by the Department before Income-tax Appellate Tribunal and High Courts and SLP before the Supreme Court. The purpose is to reduce the pendency of litigation before the above authorities. The limits stated in the said circular is as under, and applicable retrospectively i.e. applicable to the pending matters.

Sr. No.	Appeals in Income tax matters	Monetary Limit (in Rs.)
1.	Before Appellate Tribunal	10,00,000/-
2.	Before High Court	20,00,000/-
3.	Before Supreme Court	25,00,000/-

Recently, CBDT has also issued instruction bearing No. 16 of 2015 dated November 6, 2015 wherein Board has directed the Principal Chief Commissioner as well as all Chief Commissioners to pass orders granting or refusing registration under section 12AA of the Act within six months from the end of the month in which the application was received either under section 12A or section 12AA of the Act. This limit is to be strictly followed as the word in the section is “shall”. Similar instructions should also be issued for disposing of the application under section 10(23C) and/or section 154 of the Act or under other provisions of the Act, where word “shall” has been used.

Further, CBDT has also issued instruction bearing No. F. No. 279/Misc 53/2003-ITJ dated June 19, 2015, wherein it has reiterated that Instruction No. 20/2003 dated December 23, 2003 should be strictly followed and Commissioner of Income-tax (Appeals) should issue orders within 15 days from the date of last hearing.

Furthermore, the CBDT has also issued Instruction No. 17 [F. No. 225/290/2015-ITA-II] dated November 9, 2015, wherein it has been emphasised that field authorities to be fair, objective and rational while framing scrutiny assessment order. To avoid tendency to frame high pitch and unreasonable assessment order a local committee to deal with taxpayers grievances be constituted consisting of three members, as prescribed in the said circular.

Similarly, many other instructions and circulars have been issued to strengthen the administration and facilitates the taxpayers, which is a good move from the CBDT. However, the past experience shows that the CBDT instructions and circulars are not followed strictly by the lower Revenue Authorities. Hence, it is necessary that CBDT may firmly monitor the above instructions/circulars so that harassment to the taxpayers could be reduced and to create confidence in the Department for doing ease of business.

We also suggest that the Tax Simplification Committee should consider that petition/application under sections 264 & 273A should be considered by the Commissioner of Income tax as expeditiously as possible and the order of the Commissioner of Income tax on the said petition/application be appealable to the Income-tax Appellate Tribunal and not to High Court so as to reduce the pending litigation in the High Court. Further, we also suggest that CBDT should issue instructions/circulars to clarify the doubt of the taxpayers that benefit of section 72A is available to companies other than the industrial company in case of genuine amalgamation and not to take the benefit of brought forward losses and unabsorbed depreciation, as doubt is created because of the judgment of the Madras High Court in ACIT v. Apollo Hospitals Enterprises Ltd. [300 ITR 167].

Lastly, Merry Christmas and Happy New Year, 2016 to all the readers.

H. N. Motiwalla
Member, Editorial Board