Baroda Branch of WIRC of ICAI March 2
Baroda Branch of WIRC of ICAI March 2, 2013 Indirect Taxes – Analysis of Union Budget 2013 -14 & Recent Issues Presented by : CA Anirudh Sonpal
• No direction towards GST • Has largely ignored concerns and recommendations of trade & industry CA Anirudh Sonpal
CA Anirudh Sonpal
“Clarity in Tax Laws, a Stable Tax Regime, a non-adversarial Tax Administration, a Fair Mechanism for Dispute Resolution, and an Independent Judiciary will provide great assurance. ” CA Anirudh Sonpal
No Change in Peak Rate Of • Customs – 10% • Central Excise – 12% • Service Tax – 12% CA Anirudh Sonpal
Customs Products Existing (BCD) Rate BCD Revised Hazel Nuts 30% 10% De-Hulled Oat 30% 15% Bituminous Coal 5% + 6% CVD 2% + 2% CVD Steam Coal Nil + 1% CVD 2% + 2% CVD Raw Silk 5% 15% Pre-Forms of Precious and Semi-Precious Stones 10% 2% 20 Specified machinery for use in leather or footwear industry 7. 5 % 5% Textile machinery and parts Thereof 7. 5% 5% Change CA Anirudh Sonpal
Customs Products Existing (BCD) Rate BCD Revised Change Set Top box 5% 10% Cars/motor vehicles with CIF value > US $ 75% 40, 000 or with engine capacity > 3000 cc for petrol-run vehicles and > 2500 cc for diesel-run vehicles or with both 100% Import of old cars 100% 125% New motorcycles with engine capacity of 800 cc or more 60% 75% Yachts and other vessels 10% 25% CA Anirudh Sonpal
Customs • Validity Period of Exemption granted to Identified Parts of Hybrid and Electric Vehicles – Extended up to 31 -3 -2015. • Exemption from Education Cess and Secondary and Higher Education Cess withdrawn on Aeroplanes, Helicopters and their Parts. • Time period for Consumption/installation of Parts and testing Equipment imported for maintenance, repair and overhaul(“MRO”) of Aircraft by units engaged in such activities increase from 3 month to 1 Year. CA Anirudh Sonpal
Customs • Limit of Jewellery allowed duty free to an Indian Passengers who has been residing abroad for more than 1 Year or coming to India for residency has been increased: Gentleman Passenger Lady Passenger Old Value allowed duty free Revised Value allowed duty free Rs. 10, 000 Rs. 50, 000 Rs. 20, 000 Rs. 1, 000 CA Anirudh Sonpal
Excise Products Existing BED Revised BED Marble Slabs and Tiles 30 Per Sq. Meter 60 Per Sq. Meter Silver Produced or Manufactured during the Process of Zinc or lead smelting starting from the stage of Zinc or lead ore or concentrate Nil 4% Compounded duty Rate on Stainless steel “patta – Patti” Rs. 30, 000 per Machine per Month Rs. 40, 000 per Machine per Moth Mobile Handsets including cellular Phones having Sales Price > Rs. 2, 000 1% 6% SUV/Utility Vehicles – Under Tariff Heading 8703 and Engine capacity >1500 CC 27% 30% Chassis of diesel mother vehicles for the 14% transport of good 13% Change CA Anirudh Sonpal
Excise • • Exemption- All handmade carpets and other textile floor coverings of Coir and Jute, weather or not hand made Branded Aruvedic Medicaments and medicaments of Unani, Siddha, Homeopathy or Bio-Chemic system are brought under “MRP” based assessment with an abatement of 35% from MRP. Validity Period of Concessional Excise duty of 6% granted to Specified Parts of Hybrid and Electric Vehicles – Extended by 31 -3 -15. Excise duty on Cigarettes and other products – increased. CA Anirudh Sonpal
Service Tax – Changes in Negative List • Approved Vocational Course with also include Courses Conducted by State Council for Vocational Training. • “Process Amounting to Manufacture or Production” with also include processes under the Medicinal & Toilet Preparations(Excise Duties) Act, 1955. • Services in relation to Agriculture or Agricultural Produce will include all testing in relation to Agriculture or Agricultural Produce. CA Anirudh Sonpal
• Abatement for Construction of Complex, Building, Civil Structures(Notification 2/2013, w. e. f. 1 -3 -2013) • Issue – Rate under Works Contract? • Residential Unit having Carpet area upto 2000 sq. feet or Amount charged is < Rs. 1 Crore – 75% Other than above – 70%. CA Anirudh Sonpal
Modifications in Exemptions • Exemptions withdrawn • Services Provided by an Educational Institution by way of Auxiliary Educational Services and Renting of Immovable Property. • Vehicle Parking to General Public CA Anirudh Sonpal
Exemptions • Temporary Transfer or Permitting use or enjoyment of copyright – only to films exhibited in cinema halls • Restaurant/Eating Joint/ Mess – Taxable if having facility of Air Conditioning or Central Air Heating. CA Anirudh Sonpal
Exemptions • Transportation by Rail or Vessel – Exemption withdrawn for Petroleum, Postal Mails & Household effects; Few Harmonized with Exemption to GTA. • Service by Entities Registered under Section 12 AA of the I. T Act – Charitable Activities will not include Advancement of any other Object for General Public Utility. CA Anirudh Sonpal
Customs & Central Excise – Other Changes • Vacation of Stay order – Max 365 days • Power of Single Bench to hear and Dispose Appeals – limit increased from Rs. 10 lacs to Rs. 50 lacs. • Excise – Modes of Recovery – from Refund and Third Party. CA Anirudh Sonpal
Service Tax – Recovery & Penalties • Recovery (Section 73) – if demand for intended period fails on account of charges not having been established, the CEO will determine tax for 18 months(Normal Period) • Penalty (Section 77) – Restricted to Rs. 10, 000. • Penalty (Section 78 A) – Upto 1 lacs on directors/Manager/Secretory/Officer in charge – specified contraventions by Company – Wilful Actions CA Anirudh Sonpal
Service Tax - Offences • Monetary limit increased from Rs. 30 lacs to Rs. 50 lacs for Specified offences inviting imprisonment (Section 89) – similar changes also incorporated under Central Excise • Section 90 - Offence cognizable(Failure to deposit tax collected); - Other specified offences Non Cognizable & Bailable CA Anirudh Sonpal
Service Tax - Offences • Section 91 • Power to Arrest - CCE to authorize Superintendent; • Release by Asst/Deputy Com for noncognizable and bailable offences CA Anirudh Sonpal
Advance Ruling • Custom & Excise – New Activity / Business by Existing Eligible Applicants. • Excise – Cenvat Credit of Service Tax on Input Service used in Manufacture. • Excise & Service Tax – Resident Public Limited Company – Eligible. CA Anirudh Sonpal
Service Tax – Voluntary Compliance Encouragement Scheme, 2013 Amnesty or Facilitation for Non-Filers and Stop-Filers, as claimed? CA Anirudh Sonpal
Service Tax – Voluntary Compliance Encouragement Scheme, 2013 • Declaration of Tax Dues • Payable from 1 -10 -2007 to 31 -12 -2012 but not paid till 1 -3 -2013. • Conditions • No Notice till 1 -3 -2013 • Not Eligible if Return Filed but Tax Disclosed and Not Paid. CA Anirudh Sonpal
Service Tax – Voluntary Compliance Encouragement Scheme, 2013 • Liable to be rejected vide an order if Enquiry/Summons/Audit etc. pending as on 1 -3 -2013. • Declaration before 31 -12 -2013 CA Anirudh Sonpal
Service Tax – Voluntary Compliance Encouragement Scheme, 2013 • Payment • Not less than 50% before 31 -12 -2013 • Balance -before 30 -6 -2014 without interest -till 31 -12 -2014 with interest • Immunity from Penalty/Interest etc. • Acknowledgement & Discharge CA Anirudh Sonpal
Other Issues • Revised ST 3 Return – Due date 25 -3 -13 for the period July. September 2012 • Reimbursement of Expenses – Delhi High Court in the matter of Intercontinental Consultants Technocrats Pvt. Ltd. CA Anirudh Sonpal
Other Issues • POT- Circular 158/9/2012 dated 8 -5 -2012 – Rate of Tax - Delhi High Court – in the matter of Delhi Chartered Accountants Society • Recovery even if stay application not disposed of – CBEC Circular 976/01/2013 dated 1 -1 -2013 CA Anirudh Sonpal
TAMSO MA JYOTIRGAMAYA CA Anirudh Sonpal
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