MCA has vide General Circular No 06/2021 dated 03/05/2021 has given additional time till 31 July 2021, filing of certain forms which were due for filing between 1 April 2021 and 31 May 2021 without any additional filing fees.
MCA has vide General Circular No 07/2021 dated 03/05/2021, provided for additional time for filing of forms related to creation or modification of charge where creation/modification of charge date is prior to 1 April 2021 and timeline for such filing has expired and where creation/modification of charge falls on any date between 1 April 2021 to 31 May 2021.
As per MCA’s General Circular No. 08/2021 dated 03/05/2021, the time gap between two Board Meetings has been extended to 180 days from 120 days for the first two quarters of the Financial Year 2021-22. This will give additional time to Companies in India to comply with the holding of a Board Meeting.
CBDT has specified that hospitals, dispensaries and other similar medical facilities providing COVID treatment can accept payments in cash for ₹ 2 Lakhs and more.
This relaxation is provided during 01 April 2021 to 31 May 2021, and is available upon the medical facilities obtaining the PAN or Aadhar of the patient and the payer and the relationship between them.
• FMV 1 shall be determined as below:
A+B+C+D – L where,
A = book value of assets not covered under B,C and D and tax effects.
B = value of jewellery / artistic work as per valuation report
C = fair value of shares / securities as per Rule 11UA
D = stamp duty value of immovable properties
L = book value of external liabilities apart from tax effects and ascertained provisions.
• FMV 2 shall be determined as below:
E = monetary consideration received for assets covered in slump sale
F, G and H = non-monetary consideration equal to corresponding values of assets mentioned in B, C and D respectively.
ITAT highlighted that-
♦ Assessee has submitted documents like bank statement, MOA AOA etc for identity of investors and their credit worthiness
♦ Transaction has been carried out through proper banking channel
Therefore, ITAT rules in favour of assessee stating that assessee discharged its onus u/s 68 satisfactorily to obviate the mischief of this section.
On which, ITAT held that:
♦ If assessee had adjusted the input tax credit on output services, then it can not again claim as deduction and then AO had not
disputed that service tax paid on input services was not debited in profit and loss account. Hence there is no merit in the first
♦ The assessee has paid service tax on the input services and hence when any taxes paid on purchase or services is a part of cost
of goods or services which can be either debited to profit and loss account if the credit not availed or if the credit is availed, the tax
portion taken out of profit and loss treated as part of current asset.
♦ Although part of the credit pertains to last year , it is carried forward to subsequent financial year as per the provisions of law.
Also, in the case of CIT vs Kaypee Mechanical (P) Ltd. And Girdhar Fibres (P.) Ltd. Vs. ACIT has held that it is an item allowable as deduction u/s 37(1).
GST Council in its 43rd meeting held on 28th May 2021 announced various trade facilitation measures. Few important ones are summarized below:
Government department’ and “Local authority’ have been exempted from requirement of E-Invoice.
The Government has done away with the matching requirement on a monthly basis for the period April 2021 to May 2021, and for this period, taxpayer may do ITC matching with GSTR-2A/2B report cumulatively in June 2021 GSTR-3B return.
Government allows companies to file their GST compliance returns viz. GSTR-3B return, GSTR-1 return, Invoice Furnishing Facility (IFF), through Electronic Verification Code (EVC) option till 31 August 2021.
The Government has notified the amendment in Section 50 of the CGST Act with retrospective effect from 1-7-2017. The amendment provides that, interest on delayed payment of GST liability would be computed only on net tax liability paid in cash.
It is worthwhile to note that, benefit of computation of interest only on the cash component appears to be applicable only in case of delay in filing of GST returns and not in cases where tax liability is paid at the time of GST audit or in cases where GST return is already filed but few tax invoices were inadvertently missed to be reported in the return and thus, tax payment is delayed. Interest in such cases would be computed on the gross tax amount only.
The 44th Meeting of the GST Council was held via video conferencing under the Chairmanship of the Union Finance & Corporate Affairs Minister Smt. Nirmala Sitharaman on 12th June 2021. Vide the said meeting, the GST Council has recommended certain GST rate concessions towards goods used in Covid-19 relief and management, most notably being:
• Amphotericin B (drug used for treating Black Fungus cases) – GST reduced from 5% to NIL
• Remdisivir, medical grade oxygen, oxygen concentrator/ generator, ventilators, Covid testing kits, pulse oximeters, hand sanitizer and temperature checking equipment – GST rate has been reduced to 5%
• Ambulances – GST rate has been reduced from 28% to 12% to aid in the fight against the global pandemic.
The above concessional GST rates would be in force up to 30 September 2021.
Vide Notification No. 30/2021 –
Customs, dated 01 May 2021, IGST on import of oxygen concentrators for personal use was reduced from 28% to 12% for the period up to 30 June 2021. However, recently vide Notification No. 33/2021 – Customs, dated 14 June 2021, the Government has prospectively rescinded the said IGST concession. Thus, effective from 14 June 2021, IGST at 28% would be applicable on import of oxygen concentrators for personal use.
Interestingly, the Delhi High Court recently had an opportunity to decide on the constitutionality of levy of IGST on oxygen concentrators for personal use. On 21 May 2021, the Hon’ble High Court held that such levy of IGST is unconstitutional and a violation of the fundamental right to life. Government against this decision filed an appeal with the Hon’ble Supreme Court, which stayed the Delhi HC decision on 01 June 2021. The matter is sub judice with Hon’ble Supreme Court.
As a part of the measure for fight against the recent upsurge in the Covid-19 pandemic, the Government has further extended customs duty exemptions/benefits to provide relief during the ongoing pandemic:
Last month, the Government notified basic customs duty exemption on the import of specified Covid-19 relief material in the fight against Covid-19 pandemic. Now, pursuant to the decisions in the 43rd Meeting of the GST Council held on 28 May 2021, the said exemption has been extended to import of Amphotericin B, which is a drug used in the treatment of Mucormycosis (Black Fungus) cases. Further, the exemption has been extended up to 31 August 2021.
In the fight against the pandemic, to augment the efforts of the State Governments, last month, IGST exemption on import of specified Covid-19 relief material has been granted to imports by State Governments/entities nominated by State Governments. Now the same exemption has been extended to other importers as well with following conditions:
The validity of this exemption to imports by State Governments as well as other importers is extended for imports up to and inclusive of 31 August 2021.
Due dates for filing GST return in the month of June 2021
With relaxation in interest rate for delay in GST payment
With relaxation in late fees for delay in filing of GST compliance returns
Category 1 States: Chhattisgarh, Madhya Pradesh, Gujarat, Maharashtra, Karnataka, Goa, Kerala, Tamil Nadu, Telangana, Andhra Pradesh, the Union territories of Daman and Diu and Dadra and Nagar Haveli, Puducherry, Andaman and Nicobar Islands or Lakshadweep
Category 2 States: Himachal Pradesh, Punjab, Uttarakhand, Haryana, Rajasthan, Uttar Pradesh, Bihar, Sikkim, Arunachal Pradesh, Nagaland, Manipur, Mizoram, Tripura, Meghalaya, Assam, West Bengal, Jharkhand or Odisha, the Union territories of Jammu and Kashmir, Ladakh, Chandigarh or Delhi
A financial industry taskforce convened by the Monetary Authority of Singapore (MAS) launched several initiatives that seek to accelerate the environmentally conscious transformation of the Singaporean financial system.
The Green Finance Industry Taskforce (GFIT) issued a detailed implementation guide for climate-related disclosures by financial institutions. This acts as a framework to help banks assess eligible green trade finance transactions. It has also released a whitepaper on scaling green finance in the real estate, infrastructure, fund management and transition sectors.
The guide sets out best practices that are aligned with the recommendations of the Financial Stability Board’s Task Force on Climate-Related Financial Disclosures. It also outlines specific disclosure practices for the insurance, banking and asset management sectors, taking into account the unique features of each. This, MAS said, will help to enhance the quality of FIs’ climate disclosures, and facilitate more consistent and comparable disclosures across FIs.
The taskforce will also launch a series of workshops to build capacity in green finance, targeted at financial institutions and corporates, with support from its industry association partners. These workshops will run from this month until April 2022.
“GFIT’s initiatives to enhance climate-related disclosures and strengthen green capabilities will enable financial institutions to effectively develop green solutions and align their portfolios towards facilitating Asia’s transition to a low carbon economy,” said Gillian Tan, assistant managing director (development and international), MAS.
“These initiatives will also contribute to global efforts to achieve greater consistency and comparability in climate-related disclosures, as well as provide investors and market participants with the necessary information for climate risk analysis and investment decision-making.”
The Bank of Japan (BOJ), acting as agent for the Minister of Finance of Japan, and the Monetary Authority of Singapore (MAS) renewed the existing Bilateral Swap Arrangement (BSA) between the two countries on 21 May 2021.
Under the arrangement, authorities in Japan and Singapore can swap their local currencies in exchange for US dollars from each other in times of need, while also enabling Singapore to obtain Japanese yen to meet possible liquidity needs.
The size of the arrangement remains unchanged. Under the terms of the arrangement, Singapore can swap Singapore dollars for up to US$3 billion or its equivalent in Japanese yen from Japan. Japan can swap Japanese yen for up to US$1 billion from Singapore.
The renewal of the BSA incorporates amendments to align the BSA with the recent amendments to the Chiang Mai Initiative Multilateralization (CMIM) Agreement, including the increase in the IMF De-linked Portion from 30% to 40%.
The IMF De-linked Portion represents the amount each member may request from the CMIM when there is no matching IMF supported programme.
BOJ and MAS say the continued bilateral financial cooperation will “contribute to financial stability in both countries, and support growing bilateral economic and trade ties”.
The Monetary Authority of Singapore (MAS) has announced a new Regulatory Technology (RegTech) grant scheme and enhancement of the Digital Acceleration Grant (DAG) scheme. MAS will commit S$42 million for the RegTech grant scheme and DAG scheme.
The RegTech grant scheme, which is available to Singapore-based financial institutions (FIs), aims to promote the adoption and integration of technology solutions in the risk management and compliance functions of FIs. This will help FIs enhance processes and capabilities in these domains and encourage a vibrant RegTech ecosystem in Singapore.
The grant scheme will cover two tracks.
Under the pilot track, FIs can seek funding to pilot potential RegTech solutions before embarking on full-scale integration of the product into its operating environment. Funding for this track will be capped at S$75,000.
Through the production level project track, FIs can seek funding to develop larger scale customised projects that can be fully integrated into the FI’s systems. Funding for such projects will be capped at S$300,000.
Both tracks can be used to support either in-house development or commercial partnerships with RegTech firms based in Singapore.
The DAG was launched in April 2020 to help smaller FIs and FinTech firms adopt digital solutions to better cope with the impact of COVID-19, and to position themselves for subsequent recovery and growth. As of 31 March 2021, MAS received over 1,100 applications from both FIs and FinTech firms. Applicants have tapped on the DAG to adopt cloud solutions and services, online communication and collaboration tools, data-analytics solutions, compliance solutions, and office productivity tools.
In view of the strong response, MAS will commit an additional S$30 million to the DAG till 31 December 2021 to encourage the industry to adopt digital solutions that enhance productivity, cyber security, and operational efficiency. This brings the total grants available under the DAG scheme to S$65 million. Eligibility for the DAG will be extended to life insurance and general insurance agencies that employ not more than 200 agents and employees.
On 7 May 2021, The Monetary Authority of Singapore (“MAS”) released a consultation paper setting out its proposed revisions to the Guidelines on Corporate Governance for Designated Financial Holding Companies, Banks, Direct Insurers, Reinsurers and Captive Insurers which are incorporated in Singapore (“CG Guidelines”). The consultation closes on 18 June 2021.
The Guidelines on Corporate Governance comprises principles and provisions of the Code of Corporate Governance which apply to all financial institutions within scope and some additional guidelines for Singapore incorporated financial institutions. The current Code of Corporate Governance was revised in 2018 to reinforce board competencies and place greater emphasis on disclosures of relationship between remuneration and value creation. The revision also increased focus on the interests of stakeholder groups other than shareholders.
The consultation paper proposes to revise the Guidelines on Corporate Governance to incorporate 2018 changes to the Code of Corporate Governance as well as international standards and industry best practices.
Proposed Revisions to the Code of Corporate Governance
Greater responsibilities for board of directors
There is greater emphasis on expected roles and responsibilities of board of directors as set out in the Basel Committee of the Banking Supervision Core Principles for Effective Banking Supervision and the International Association of Insurance Supervisors Core Principles. The Board is expected to review financial institutions corporate governance framework, culture and conduct framework, business objectives and strategies on an annual basis. There is a requirement to have an appropriate risk management system and adequate internal controls to support the financial institution’s risk appetite.
Recommendations for oversight of remuneration practices
The Guidelines on Corporate Governance sets out recommendations for remuneration practices. It is expected that financial institutions design and implement appropriate remuneration policies for employees with active oversight and monitoring of effectiveness of policies by senior management. Effective oversight includes ensuring performance evaluation and conducting independent annual reviews which must take into account both financial and non-financial factors.
Documentation for unresolved concerns of independent directors
As part of the Guidelines on Corporate Governance, MAS requires unresolved concerns for independent directors, particularly those on the running of the company, be documented in the minutes of the board meetings. MAS proposes to include this expectation as a new additional guideline under the Guidelines on Corporate Governance.
Appointment of non-directors to the Board Risk Committee
The Board Risk Committee of a financial institution has statutory responsibilities under the Corporate Governance regulations for overseeing the establishment and operation of an independent risk management system for the financial institution, as well as ensuring the adequacy of the risk management function of the financial institution. To achieve this, the financial institutions, as part of Guidelines on Corporate Governance, are expected to appoint independent directors with skills and competency relevant to their business strategies and objectives. Given the limited pool of resources, some financial institutions have resorted to utilising subject matter experts in their place. MAS proposes that an expert, who is not a director, may be appointed as a member of the Board Risk Committee. Appropriate notifications must be provided to MAS and the individuals must commit to appropriate undertakings for proper accountability.
The consultation paper is available on the MAS website www.mas.gov.sg
Singapore and Serbia have signed the Agreement between the Government of the Republic of Singapore and the Government of Republic of Serbia for the Elimination of Double Taxation with respect to Taxes on Income and the Prevention of Tax Evasion and Avoidance (“DTA”).
The DTA was signed by Minister for Education and Second Minister for Finance, Mr Lawrence Wong, and Minister of Finance for Serbia, Mr Siniša Mali.
The DTA clarifies the taxing rights of both countries on all forms of income flows arising from cross-border business activities, and minimises the double taxation of such income. This will lower barriers to cross-border investment and boost trade and economic flows between the two countries. Key terms of the Agreement can be found in the Annex.
Article in the DTA
Key terms in the DTA
Article 5, Permanent Establishment
· Period test of 12 months for construction-related activities, beyond which residents of a contracting state could trigger a taxable presence in the other contracting state;
· Threshold of 270 days in any 12-month period for the furnishing of services by an enterprise of a contracting state within the other contracting state
Article 10, Dividends
· 5% withholding tax rate (if shareholding ≥ 25%);
· 10% withholding tax rate (all other cases)
Article 11, Interest
· 10% withholding tax rate
Article 12, Royalties
· 5% or 10% withholding tax rate depending on the nature of the royalties
Form C-S/C for the FY 2020 -30 – November 2021
Estimated Chargeable Income (ECI) (March year-end)- 30 – June 2021
GST Return for Quarter ending: June 2021- 31 – July 2021