Coal India Limited is going to recruit CA. For more information about job click Job for CA at Coal India. Please read the information clearly before applying for the same.

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Here i am sharing few points which must be known about the said notification.

Assessee who can claim the said exemption: For availing the said notification all the following conditions must be satisfied by the Assessee.

• Only Individuals (whether resident or not) can avail this exemption for Assessment year 2012-13.
• Total Income (after deduction 80C to 80U) must be up to Five Lakh Rupees only.
• Income must be earned from Salary including pension and/or Saving Bank Interest up to Rs Ten Thousand. Income from saving bank interest must be reported by individual to his employer for TDS deduction purposes. Further he has earned Salary Income only from one employer during the year
• Individual must give his PAN No to the employer.
• Employer has deducted the tax on his total income i.e. Salary plus Interest from Saving Bank Interest if any, and TDS has been deposited in Govt account by the employer.
• There is no refund claim by the individual.
• Individual has received Form 16 from the employer.

Assessee who can’t claim the said exemption

• An individual having taxable income after deduction u/s 80C to 80U is more than Rs Five Lakh.
• If he has received salary from two employers during the year.
• Assessment year is other than 2012-13.
• Not reported his PAN Number to the employer.
• Form 16 is not issued to him by the employer.
• Refund claim by the individual.
• If  his total income includes  any one of following Incomes:-

ü  Income from House Property/PGBP/Capital Gain.

ü  Income from Interest other than Interest from saving bank.

ü  Saving Bank interest is more than 10000 rupees.

ü  Any other Income (other than  Saving Bank interest ) under “Income from other source”

• In case he has not reported his Saving Bank interest income to his employer for tax deduction.
• If he has discharged his tax liability through advance tax or self assessment       challan.
• If notice u/s 142(1) or section 148 or section 153A or section 153C of the Income-tax Act has been issued for filing a return of income.

Here i am sharing an important circular regarding clarification on rate of tax in case of 8 Specified Services provided by individuals/firms to which rule 7 of POT Rules 2011 was applicable and services on which tax is paid under reverse charge.

To download the said circular click CIRCULAR No 158

To download circular click Circular No 8 2012.

Agriculture Insurance Company of India Limited is going to recruit CA. For more information about job click Job For CA at Agriculture Insurance Company. Please read the information clearly before applying for the same.

Eligible Assessee for Section 44AD: Individual, HUF, Resident Partnership firm but not LLP. Further provided that assessee mentioned does not claim deduction under any of sections 10A, 10AA, 10B or deduction under heading “C. Deductions in respect of certain incomes” under chapter VIA in the relevant assessment year.

Eligible Business for Section 44AD: Eligible business means any business whose total turnover or gross receipts in the previous year does not exceed an amount of Rs Sixty Lakh except the business of plying, hiring or leasing goods carriage referred to in section 44AE.

Special Provision for Section 44AD:-

• In case assessee is engaged in more than one business than his turnover shall not be covered for the purpose of calculating limit of Rs Sixty Lakh (Rs One Crore proposed in union budget 2012-13).
• Deduction under sections 30 to 38 shall be deemed to be already given and no further deduction shall be allowed. However in case of firm remuneration and interest paid to partners to the firm shall be allowed form the deemed income calculated. The remuneration and interest shall be calculated as per provision of section 40(b).
• Provision of Advance Tax shall not apply to eligible assessee.
• No need to maintain books of accounts under section 44AA in case assessee is opting section 44AD.
• In case assessee claim that his income is lower than the income deemed u/s 44AD and his income is chargeable to tax i.e. his total income exceeds maximum amount which is not chargeable to income tax then he shall keep and maintain books of a/c mentioned u/s 44AA and get such a/c audited u/s 44AB and shall furnished the prescribed report within prescribed time.
• Current year losses and brought forward losses can be set off against the deemed income u/s 44AD.
• Deduction u/s 80C to 80GGC is allowed to eligible assessee.

Deemed income shall be 8% of total turnover or gross receipts of the assessee in the previous year on account of such business.

The Cost Compliance Report is required to be submitted by Companies when following conditions are satisfied:-

Condition 1: Companies engaged in production, manufacturing, processing, and mining of goods or services. (Both Private Limited & Public Limited Companies are covered).

Condition 2: Further in addition to above condition the Companies are

• Listed on Stock Exchange, or
• Net worth exceeds Rs. 5 crores, or
• Turnover of the company exceeds Rs. 20 crores.

To download the said notification and to know about its applicability in detail click MCA Notification on Cost Compliance Report.

Point of Taxation Rules, 2011

Rule 3: Rule 3 contain about the point at which tax is to be levied. As per Rule 3(a) the point of taxation shall be at the time when the invoice for the service provided or to be provided is issued. The proviso to this rule lays down that if invoice is not issued with fourteen days of the completion of the service then the point of taxation shall be the date of completion of the service. Further Rule 3(b) contains that if any payment is received before the time which is specified in clause (a) then the point of taxation shall be the date on which such payment was received, to the extent of such payment. Thus if any advance is received by the service provider towards the provision of taxable service then the point of taxation shall be date of receipt of such advance. Further if advance is received in installments then the point of taxation shall be each such date on which the advance is received.

Here is the analysis of Rule 3 in tabular form

Rule 4: This rule contain about point of taxation in case of change of rate of tax. When there is a change in rate of service tax rule 4 shall be applicable and not rule 3.

For detail on Rule 4 click

http://www.naveenchandkhulve.com/determination-of-rate-of-service-tax/

Rule 5: Rule 5 discuss about the provisions for payment of tax in case of new services. It is explicitly stated that where a service is taxable for the first time then no tax shall be payable to the extent the invoice has been issued and the payment has been received against such invoice before the said service became taxable. However if all payments realized after the service became taxable then also service tax shall be leviable even though invoice has been issued prior to the date when the service was brought within the tax net. Further as per Rule 5 (b) service tax shall not be payable if the payment has been received before the service became taxable and the invoice for the said payment has been issued within 14 days from the date of provision of service or receipt of payment whichever is earlier.

Rule 6: Rule 6 discuss about the continuous supply of service. Following are the services which are notified as continuous supply of service vide Notification No. 28/ST-2011 dated April 1, 2011.

Section 65(105)(zzzx) Telecommunication

Section 65(105)(zzq) Commercial or Industrial Construction

Section 65(105)(zzzh) Construction of Complex

Section 65(105)(zzzu) Internet Telecommunication

Section 65(105)(zzzza) Works Contract

All other taxable services shall be treated as continuous supply of service only if they are provided or agreed to be provided continuously for a period exceeding three months.

Only Rule 6 applies to continuous supply of service. Point of Taxation in case of continuous supply of service shall be the time when the invoice for the service provided or to be provided is issued. Further if invoice is not issued within fourteen days of the completion of service then the point of taxation shall be the date of completion of such service. However where any payment is received in advance by the service provider that date on which such payment was received will be point of taxation to the extent of such payment.

As per Rule 6(1) in case where terms of contract govern the payment criteria and where the service provided in whole or part is determined periodically on completion of an event in terms of a contract and upon happening of such an event the service receiver is liable to make payment to the service provider then the date of completion of each such event will be deemed to be the date of completion of service irrespective of whether payment is received from the service receiver or not. Further Rule 6(2) clarifies that where any advance payment is received by the service provider from the service receiver towards the provision of taxable service the point of taxation shall be the date of receipt of each such advance payment.

Rule 7: Rule 7 deals about point of taxation rule in case of specific taxable services or persons. For the purpose of Rule 7 following are the specific taxable services or persons:-

v Individuals, Proprietary Firms or Partnership Firms who are providing any of the following taxable services:-

• Architect
• Interior Decorator
• Chartered Accountant
•  Cost Accountant
• Company Secretary
• Scientific and Technical Consultancy
• Legal Services and Consulting Engineer

v Services covered by sub-rule (1) of rule 3 of Export of Services Rules

v Persons who are liable to tax under the reverse charge mechanism i.e. where the recipient of taxable service is liable to deposit service tax as a deemed service provider.

In all the above cases Point of Taxation shall be the date on which the payment is received or made by the service provider or service receiver as the case may be.

Points required to be considered for applicability of Rule 7:-

• In respect of services covered under sub-rule (1) of rule 3 of Export of Services Rules the payment for such services should be realized within period specified by the Reserve Bank of India and if the payment is not received with the said specified period then the point of taxation shall be determined as if Rule 7 did not exist at all.
• In respect of services where the recipient of the taxable service is liable to pay service tax then such recipient should make payment of the value of taxable service to the service provider within six months from the date of invoice and if such payment is not made then it would be deemed that Rule 7 did not exist at all.
• In the case of Associated Enterprises where the person who is providing the services is located outside India the point of taxation shall be the date of making credit entry for the amount to be paid in the books of account of the person receiving such service or the actual date of making the payment to the service provider outside India whichever is earlier.

Rule 8: Rule 8 discuss about royalties, copyrights, trademarks, designs and patents. Due to possibility that at the time of providing these services the whole amount of consideration payable to the service provider may not be ascertainable. In such situation the rule provides that after the service has been provided and the use or benefit of the said service by any person other than the service provider gives rise to payment of any consideration then the service shall be treated as having been provided each time when the consideration is received or an invoice is issued by the service provider whichever is earlier.

Rule 9: Rule 9 state that Point of Taxation Rules does not apply to services which are completed or where invoices are issued prior to the date on which these rules came into force i.e. 1^st April 2011. Services which are completed on or before June 30th 2011 or where the invoices are issued upto June 30, 2011 the option to follow the provisions of these rules with effect from April 1, 2011 or treat the point of taxation as the date on which the payment is received or made is at the discretion of the service provider or service receiver, as the case may be.

Note: Time period for issuance of invoice/bill/challan has increased from 14 days to 30 days.  Further for banks and financial institution providing banking and other financial services , the time period for issuance of invoice/bill/challan would be 45days. They shall come into force on the 1st day of April, 2012. (vide Notification No 3/2012 dated 17.03.2012)