Govt Notifies Taxation and other Laws (Relaxation
of Certain Provisions) Ordinance, 2020
Various
relief measures were announced by Finance Minister Smt. Nirmala Sitharaman on
24th March, 2020 and to give effect to that relief measures
Government of India notifies Taxation and Other Laws (Relaxation of Certain
Provisions) Ordinance, 2020 on 31.03.2020. These relief measures are related to
Income Tax return filings, GST compliance, PAN-Aadhar linkage and other
statutory and regulatory issues.
India’s
economic growth could take a hit of up to half a percentage point in FY21
because of the disruptions caused by the Covid-19 outbreak, early estimates by
the government suggest. But independent economists see a deeper cut of up to
one percentage point.
“There
will be a hit of 0.3-0.5% on the GDP in the next fiscal year,” said one of the
officials aware of the estimate. Growth in the first two quarters of the next
fiscal could be as low as 4-4.5%,” another official added.
The
economy is forecast to grow 5% in current fiscal, the slowest in 11 years. The
Economic Survey had forecast 6-6.5% rise in FY21, but Covid-19 has hurt
recovery prospects.
Source:https://economictimes.indiatimes.com/news/economy/policy/outbreak-will-set-back-indias-growth-recovery/articleshow/74663633.cms?from=mdr
Finance Minister to help the
nation's poor tackle the financial difficulties arising from Covid-19 outbreak.
The package includes a mix of food security and direct cash transfer benefits
which shield poor families during the lockdown. It’s a very well-defined package,
reinforcing government’s intent that no one should be deprived of basic facilities
in today’s stressed times.
Keeping
in view the challenges faced by taxpayers in meeting the compliance
requirements under such conditions, the Union Finance Minister had announced
several relief measures relating to statutory and regulatory compliance matters
across sectors in view of COVID-19 outbreak on 24.03.2020 vide a press
release.
Specific Act means:
1. The Wealth Tax Act,
1957;
2. The Income Tax Act,
1961;
3. The Prohibition of
Benami Property Transactions Act, 1988
4. Chapter VII of the
Finance (No.2)Act, 2004
5. Chapter VII of the
Finance Act, 2013
6. The Black Money (Undisclosed
Foreign Income and Assets) and Imposition of Tax Act, 2015;
7. Chapter VIII of the
Finance Act, 2016; or
8. The Direct Tax Vivad se
Vishwas Act, 2020
Key
Highlights of the Ordinance is outlined below-
Some of the important features and time limits which
get extended by this Ordinance are as under:-
Direct
Taxes & Benami:
- Extension
of last date of filing of original as well as revised income-tax returns
for the FY 2018-19 (AY 2019-20) to 30th June, 2020.
- Extension
of Aadhaar-PAN linking date to 30th June, 2020.
- The
date for making various investment/payment for claiming deduction under
Chapter-VIA-B of IT Act which includes Section 80C (LIC, PPF, NSC etc.),
80D (Mediclaim), 80G (Donations), etc. has been extended to
30th June, 2020. Hence the investment/payment can be made up to
30.06.2020 for claiming the deduction under these sections for FY 2019-20.
- The
date for making investment/construction/purchase for claiming roll over
benefit/deduction in respect of capital gains under sections 54 to 54GB of
the IT Act has also been extended to 30th June 2020. Therefore, the
investment/ construction/ purchase made up to 30.06.2020 shall be eligible
for claiming deduction from capital gains arising during FY 2019-20.
- The
date for commencement of operation for the SEZ units for claiming
deduction under deduction 10AA of the IT Act has also extended to
30.06.2020 for the units which received necessary approval by 31.03.2020.
- The
date for passing of order or issuance of notice by the authorities under
various direct taxes& Benami Law has also been extended to 30.06.2020.
- It
has provided that reduced rate of interest of 9% shall be charged for
non-payment of Income-tax (e.g. advance tax, TDS, TCS) Equalization Levy,
Securities Transaction Tax (STT), Commodities Transaction Tax (CTT) which
are due for payment from 20.03.2020 to 29.06.2020 if they are paid by
30.06.2020. Further, no penalty/ prosecution shall be initiated for these
non-payments.
- Under Vivad se Vishwas Scheme, the date has also been extended up to 30.06.2020. Hence, declaration and payment under the Scheme can be made up to 30.06.2020 without additional payment.
Indirect
Taxes:
- Last
date of furnishing of the Central Excise returns due in March, April and
May 2020 has been extended to 30th June, 2020.
- Wherever
the last date for filing of appeal, refund applications etc., under the
Central Excise Act, 1944 and rules made thereunder is from 20th March
2020 to 29th June 2020, the same has been extended to 30th June
2020.
- Wherever
the last date for filing of appeal, refund applications etc., under the
Customs Act, 1962 and rules made thereunder is from 20th March 2020
to 29th June 2020, the same has been extended to 30th June 2020.
- Wherever
the last date for filing of appeal etc., relating to Service Tax is from
20th March 2020 to 29th June 2020, the same has been extended to
30th June 2020
- The
date for making payment to avail of the benefit under Sabka Vishwas Legal
Dispute Resolution Scheme 2019 has been extended to 30th June 2020
thus giving more time to taxpayers to get their disputes resolved.
In
addition to the extension of time limits under
the Taxation and Benami Acts as
above, an enabling section has got inserted in the CGST Act, 2017 empowering
the Government to extend due dates for various compliances inter-alia including
statement of outward supplies, filing refund claims, filing appeals, etc.
specified, prescribed or notified under the Act, on recommendations of the GST
Council.
PM
CARES FUND
Keeping in mind the need for having a dedicated national fund with the
primary objective of dealing with any kind of emergency or distress situation,
like posed by the COVID-19 (Coronavirus) pandemic, and to provide relief to the
affected, a public charitable trust under the name of ‘Prime Minister’s Citizen
Assistance and Relief in Emergency Situations (PM CARES) Fund’ has been set up.
4.
A special fund “Prime Minister’s Citizen Assistance and
Relief in Emergency Situations Fund (PM CARES FUND)”
has been set up for providing relief to the persons affected from the outbreak
of Corona virus. The Ordinance also amended the provisions of the Income-tax
Act to provide the same tax treatment to PM CARES Fund as available to Prime
Minister National Relief Fund. Therefore, the donation made to the PM CARES
Fund shall be eligible for 100% deduction under section 80G of the IT Act.
Further, the limit on deduction of 10% of gross income shall also not be
applicable for donation made to PM CARES Fund.
As
the date for claiming deduction u/s 80G under IT Act has been extended up to
30.06.2020, the donation made up to 30.06.2020 shall also be eligible for
deduction from income of FY 2019-20. Hence, any person including corporate
paying concessional tax on income of FY 2020-21 under new regime can make
donation to PM CARES Fund up to 30.06.2020 and can claim deduction u/s 80G
against income of FY 2019-20 and shall also not lose his eligibility to pay tax
in concessional taxation regime for income of FY 2020-21.
The
ministry of corporate affairs has clarified that company’s contributions to the
PM CARES Fund over and above the minimum prescribed corporate social
responsibility (CSR) spends can be offset against their CSR obligations of
subsequent years.
DISCLAIMER: The Article Is Based On The Relevant Provisions And As Per The Information Existing At The Time Of The Preparation. In No Event I Shall Be Liable For Any Direct And Indirect Result From This Article. This Is Only A Knowledge Sharing Initiative.
THE AUTHOR – CS
Deepak Seth (Associate Partner at Helpinghands Professionals LLP) and can be
reached at contacthhpro@gmail.com or 9910248911.
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