Respected Professional Colleagues

Wish you a very happy Ram Navami and Mahavir Jayanti. May Lord Rama fill up your life with joy, happiness and above all good heath.

Year 2017 is full of events. January 2017 witnessed the effect of demonetisation and February brought with itself the annual budget. Key changes are made in the Act, some of them which are of general importance are as under:

A. Section 139AA is inserted after section 139A whereby after 1st July 2017, to quote Aadhaar Number is made mandatory (i) while making application for PAN and (ii) in the return of income. In case a person does not have an Aadhaar, he will be required to quote his Aadhaar enrollment number indicating that an application to obtain Aadhaar has been filed. Further every person holding a PAN on July 1, 2017 and who is eligible to hold an Aadhaar, will be required to provide his Aadhaar Number to the authorities, by a date and in a manner notified by the Central Government. A failure to provide the same would result in PAN being invalidated and the person would be treated at par with anyone who has not applied for a PAN. The Government may exempt persons from this provision through a notification.

B. A far reaching administrative reform is made whereby certain Tribunals are proposed to be replaced and their functions are proposed to be taken over by existing Tribunals under other Acts. The Chairpersons, Vice Chairpersons, Chairmen or other members who are currently having post with the Tribunals to be merged, will be entitled to receive up to 3 months’ pay and allowances for premature termination of their office term. Further as per newly inserted provisions of section 252A, the Central Government may make rules to provide for the (i) qualifications, (ii) appointments, (iii) term of office, (iv) salaries and allowances, (v) resignation, (vi) removal and (vii) other conditions of service for these members. The age of retirement for these persons has been specified such as (i) 70 years for Chairpersons, Chairmen or Presidents and (ii) 67 years for Vice Chairpersons, Vice Chairmen, Vice Presidents and Presiding Officers. At this juncture, it is to be noted that in the case of
Madras Bar Association vs. Union of India (TC No.150 of 2006 (SC) decided on 25-9-2014), Hon’ble Supreme Court while examining a case relating to National Tax Tribunal had held that Appellate Tribunals have similar powers and functions as that of High Courts and therefore, matters relating to appointment, re-appointment and tenure must be free from executive involvement. This principle appears to be ignored while suggesting this amendment.

C. In the Finance Bill 2017, section 269ST was proposed to be inserted whereby it was proposed that cash transactions exceeding ₹ 3 lakh will not be permitted (i) from a single person in one day, (ii) in respect of a single transaction (irrespective of number of payments) and (iii) for any transactions relating to a single event. In the Act, the said limit is reduced to ₹ 2 lakh from

₹ 3 lakh. Failure to comply with the said provision will attract the penalty, being a sum equal to the amount of such receipt u/s. 271DA. However, it is open to such person to prove that there were good and sufficient reasons for the contravention. Moreover, this penalty shall be imposed only by the Joint Commissioner.

D. Donation to Political Parties by Companies : At present company may contribute up to 7.5% of the average of its net profit in the last 3 financial years, to political parties and to disclose the said amount of contribution in its Profit & Loss A/c along with name of the parties to which such contribution was made. This limit has been done away with in amended section 13A. It is stated that no donation exceeding ₹ 2,000/- is received by such political party otherwise than by an account payee cheque drawn on a bank or an account payee bank draft or use of electronic clearing system through a bank account or through electoral bond. These provisions are made to bring out the transparency and also to curb the black money.

Friends, there are number of amendments but the same will be discussed at the appropriate conferences. However, one thing is clear that Department has become vigilant at this time, new ITR forms have been published in the month of March, 2017 itself and therefore, the general public will not have to rush to the Courts for extending the due date of filing of return as done in preceding years.

Government has notified simplified one page form “ITR-1 (Sahaj)” for individuals earning income from salary, pension, one house property and income from other sources. A new column has been introduced in all ITR forms to report in respect of cash deposited in their bank account during the Demonetisation period i.e., from Nov., 2009 to Dec., 30, 2016. A special column has been made for quoting Aadhaar Number. New columns (Schedule-SI) have been inserted in ITR forms to report unexplained income because as per the provisions of section 115BBE, any unexplained credit or investments attracts tax at 60% along with surcharge and cess as applicable, irrespective of the slab of income and tax. Similarly, new column (Schedule-OS) has been inserted in the ITR forms to declare dividend exceeding ₹ 10 lakh which may attract tax @ 10%. A new field has been provided under Schedule VI-A to claim deduction on account of home loan interest u/s. 80EE. For the returns filed u/s. 44AD, new column has been inserted to show turnover received through digital mode which may be taxed at 6% instead of 8%. Now taxpayers are required to mention registration number of the firm of Chartered Accountant which has done audit, in ITR forms.

In view of above, it appears that the Chartered Accountants, Advocates and Tax Practitioners have to be more careful while filing the returns.

Friends, there is a lot to be discussed. The platform has already been prepared to roll down the GST Act with effect from 1st July, 2017. Entire country including professionals, businessmen, industrialists and manufacturers all are preparing themselves to welcome GST which is the biggest tax reform since independence. Our Federation is also ready to hold and organise conferences and seminars at various places.

Friends, last but not the least, I once again request (as I am doing in every communiqué) our past and existing executive members to send the consent letters duly signed to Mr. Ravi so that the compliance may be made before the Charity Commissioner. It is not out of place to mention that you all are very much concerned for the Federation, you are the pillar of Federation and therefore, it is your pious duty to comply with the same. I hope that I will not have to request again in my next communiqué.

Friends, I remind you all of National Tax Conference and National Executive Committee Meeting organised by the West Zone at Vallabh Vidya Nagar, Anand, Gujarat on 22nd and 23rd April, 2017 and also of an International Study Tour to Sri Lanka from 3rd June to 9th June, 2017.

I once again express my deepest regards and wish you all A Very Happy New Year (Vikram Samvat)

With Best Wishes,

Prem Lata Bansal
National President

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