Permanent Account Number (PAN) Mandatory...!!! DEMAT Accounts will be suspended w.e.f. 16-08-2010.

Mandatory requirement of Permanent Account Number (PAN)

Circular No. MRD/DP/22/2010, dated 29-7-2010

1. Please refer to SEBI circular No.MRD/DoP/Cir-05/2007 dated April 27, 2007 making PAN mandatory for all transactions in the securities market.

2. As you are aware, the demat accounts for which PAN details have not been verified are “suspended for debit” until the same is verified with the Depository Participant (DP). However, it has come to our notice that despite follow up, investors are not furnishing the PAN details.

3. In order to ensure better compliance with the Know Your Client (KYC) norms it has been decided that with effect from August 16, 2010 such PAN non-compliant demat accounts shall also be "suspended for credit" other than the credits arising out of automatic corporate actions. It is clarified that other credits including credits from IPO/FPO/Rights issue, off-market transactions or any secondary market transactions shall not be allowed into such accounts.

4. The Depositories are advised to:-

a) make amendments to the relevant bye-laws, rules and regulations for the implementation of the above decision immediately, as may be applicable/necessary ;

b) bring the provisions of this circular to the notice of their DPs and advising them to also communicate the same to all the Beneficial Owners (BOs); and

c) disseminate the same on the website.

5. This circular is being issued in exercise of the powers conferred by Section 11(1) of Securities and Exchange Board of India Act, 1992 and Section 19 of the Depositories Act, 1996 to protect the interests of investors in securities and to promote the development of, and to regulate, the securities market.

Kindly note that SEBI has decided to penalise errant investors for not furnishing PAN details. The regulator has decided that PAN non-compliant demat accounts would be suspended for credit from IPO, FPO, rights issue, off-market transactions or secondary market transactions with effect from August 16,2010. This suspension, however, would not apply for credits arising out of automatic corporate actions. Depositories have been advised to amend relevant bye-laws, rules and regulations, for implementing the decision immediately.

GOOD NEWS - YOU CAN CHECK YOUR ITR-V/ E FILING PROCESSING STATUS ONLINE NOW

Those assessees who have filed their Income Tax return online(e filing ) without digital signature have to furnish the ITR-V form within 120 days from date of uploading of the Income tax return (xml File) to the Central processing cell at Bangalore .Further Income Tax deptt has issued Press release that ITR -V should only be send through ordinary post only and speed post, registered post and courier will not be received .Then, How person will be know whether The ITR-V has reached at the Bangalore office or not? and some confirmation should be there in e-filing portal or person should be informed through email about the ITR-V status .

Good news is that Income tax deprt has now added a link in e filing site by name "e filing processing status" under My Account Menu.To know your e filing Processing status.To know your ITR-V/E filing return processing status follow this steps as Given below .

Login to the e filing site with your pan and password.

Go to the "My Account " tab

In drop down menu under My account Tab click " e- filing processing status"

In next screen -- fill you ITR-V acknowledgement Number and Select your assessment year.

You will get status of your return/ITR-V processing status in next screen.

Further Income tax department clarified that copy of ITR-V sent by them to CPC Bangalore will be scanned after stamping receipt number and date of receipt and the same shall be made available to taxpayers on request through email shortly.

Please await further information on procedure for the same.

Department has now started emailing the Acknowledgement as token of receipt for ITR -V on reaching at Bangalore office but due to rush it will take time.

This is a welcome step by the Income tax Department. Yah we are in digital age know....

(Curtesy: Simple tax)

Is your Gross Total Income More than Exemption Limit ? Income Tax Return Compulsory !!!

Every person/Individual thinks that he need not file an I.T.Return if there is no recovery of IT from his salary or below the exempted limit. But while carefully studying the statue, we can arrive at a conclusion that we have to file ROI if....

For Assessment year 2010-11 Exemption Limit for Individual is given below

For Male Resident =160000
For Female resident=190000
For senior citizen resident =240000
For Huf=160000
For other Individuals =160000

Let us see the statue:

"Provided also that every person, being an individual or a Hindu undivided family or an association of persons or a body of individuals, whether incorporated or not, or an artificial juridical person, if his total income or the total income of any other person in respect of which he is assessable under this Act during the previous year, without giving effect to the provisions of section 10A or section 10B or section 10BA or Chapter VI-A exceeded the maximum amount which is not chargeable to income-tax, shall, on or before the due date, furnish a return of his income or the income of such other person during the previous year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed."

As per section 139(1) proviso ,income tax return is to be filed if person gross total income not net taxable income , is More than exemption limit means if you have earned 2,50000 in Fy 2009-10 and saved 100000(u/s 80C) and your net taxable income is 250000-100000=150000 Rs even then as per Income tax act,you have to file return as your Gross total income(250000) is more than 160000 .So as per above rule to check whether Income is more than exemption limit or not for Income Tax return filing purpose ,we should consider income before giving effect to deduction under Chapter VIA ie deduction u/s 80C to 80U.More over while considering income for Income tax tax return purpose person should not give effect to exemption under section 10A and 10B and 10BA.

So be ready for filing of return if your Gross total Income Is more than exemption limit or even your employer has deducted due tds on your income. As it is mandatory to file retrun of income to such persons .

Due date to file Income tax for Non -audit cases for assessment year 2010-11 is 31.07.2010.

No disallowance u/s 40(a)(ia) if TDS paid before due date of filing ROI

The assessee made payments to sub-contractors during the previous year and though s. 194C requires TDS at the stage of payment/credit, did not do so. The tax was, however, deducted on 31st March and paid over in Sept before the due date for filing the return. The AO took the view that while the payment made to the sub-contractor for March was allowable, the payments for the earlier months was disallowable u/s 40(a)(ia). This was confirmed by the CIT (A). On appeal by the assessee, HELD allowing the appeal:
Failure to deduct or deposit tax as per s. 194C or Chapter-XVII makes the assessee liable to the consequences provided under the said Chapter-XVII. However, s. 40(a)(ia) is in addition to Chapter XVII. S. 40(a)(ia)(A) provides that if tax is deducted during the last month of the previous year and paid on or before the due date of filing of return as per s. 139(1), then such sum shall be allowed as deduction. In cases where tax is deducted other than the last month of previous year but is deposited before the last day of the previous year, then it will be allowed as deduction. Therefore, the conditions for allowability of deduction are prescribed u/s 40(a)(ia) itself and Chapter-XVII and s. 194C are not relevant. If the condition of deduction and payment prescribed u/s 194C / Chapter XVII are held applicable for dis-allowance of deduction u/s 40(a)(ia), then s. 40(a)(ia) will be rendered meaningless, absurd and otiose. Since the assessee had (belatedly) deducted tax in the last month of the previous year i.e. March 2005 and deposited the same before the due date of filing the return u/s 139(1), deduction had to be allowed u/s 40(a)(ia) (A).
Bapushaeb Nanasaheb Dhumal vs. ACIT (ITAT Mumbai)

Note: S. 40(a)(ia) has been amended by the FA 2010 w.e.f. 1.4.2010, to provide that in all cases if TDS is paid before the due date of filing the ROI, no disallowance shall be made.

The text of the same is reproduced hereunder for ready reference:

The existing provisions of section 40(a)(ia) of Income-tax Act provide for the disallowance of expenditure like interest, commission, brokerage, professional fees, etc. if tax on such expenditure was not deducted, or after deduction was not paid during the previous year. However, in case the deduction of tax is made during the last month of the previous year, no disallowance is made if the tax is deposited on or before the due date of filing of return.

It is proposed to amend the said section to provide that no disallowance will be made if after deduction of tax during the previous year, the same has been paid on or before the due date of filing of return of income specified in sub-section (1) of section 139.

This amendment is proposed to take effect retrospectively from 1st April, 2010 and will, accordingly, apply in relation to the assessment year 2010-11 and subsequent years.

RELATED CLAUSE REPRODUCED HEREUNDER

12. In section 40 of the Income-tax Act, in clause (a), in sub-clause (ia),—
(a) for the portion beginning with the words “has not been paid,—” and ending with the words “the last day of the previous year”, the words, brackets and figures “has not been paid on or before the due date specified in sub-section (1) of section 139” shall be substituted;

(b) for the proviso, the following proviso shall be substituted, namely:—

”Provided that where in respect of any such sum, tax has been deducted in any subsequent year, or has been deducted during the previous year but paid after the due date specified in subsection (1) of section 139, such sum shall be allowed as a deduction in computing the income of the previous year in which such tax has been paid.”.

(Curtesy : Simple tax)

Funny joke on Taxes - Enjoy

1) Qus. : What are you doing? Ans. : Business. Tax : PAY PROFESSIONAL TAX!
2) Qus. : What are you doing in Business? Ans. : Selling the Goods. Tax : PAY SALES TAX!!
3) Qus. : From where are you getting Goods? Ans. : From other State/Abroad Tax : PAY CENTRAL SALES TAX, CUSTOM DUTY & OCTROI!
4) Qus. : What are you getting in Selling Goods? Ans. : Profit. Tax : PAY INCOME TAX!
5) Qus. : How do you distribute profit ? Ans : By way of dividend Tax : Pay dividend distribution Tax
6) Qus. : Where you Manufacturing the Goods? Ans. : Factory. Tax : PAY EXCISE DUTY!
7) Qus. : Do you have Office / Warehouse/ Factory? Ans. : Yes Tax : PAY MUNICIPAL & FIRE TAX!
8) Qus. : Do you have Staff? Ans. : Yes Tax : PAY STAFF PROFESSIONAL TAX!
9) Qus. : Doing business in Millions? Ans. : Yes Tax : PAY TURNOVER TAX! Ans : No Tax : Then pay Minimum Alternate Tax
10) Qus. : Are you taking out over 25,000 Cash from Bank? Ans. : Yes, for Salary. Tax : PAY CASH HANDLING TAX!
11) Qus.: Where are you taking your client for Lunch & Dinner? Ans. : Hotel Tax : PAY FOOD & ENTERTAINMENT TAX!
12) Qus.: Are you going Out of Station for Business? Ans. : Yes Tax : PAY FRINGE BENEFIT TAX!
13) Qus.: Have you taken or given any Service/s? Ans. : Yes Tax : PAY SERVICE TAX!
14) Qus.: How come you got such a Big Amount? Ans. : Gift on birthday. Tax : PAY GIFT TAX!
15) Qus.: Do you have any Wealth? Ans. : Yes Tax : PAY WEALTH TAX!
16) Qus.: To reduce Tension, for entertainment, where are you going? Ans. : Cinema or Resort. Tax : PAY ENTERTAINMENT TAX!
17) Qus.: Have you purchased House? Ans. : Yes Tax : PAY STAMP DUTY & REGISTRATION FEE !
18) Qus.: How you Travel? Ans. : Bus Tax : PAY SURCHARGE!
19) Qus.: Any Additional Tax? Ans. : Yes Tax : PAY EDUCATIONAL, ADDITIONAL EDUCATIONAL & SURCHARGE ON ALL THE CENTRAL GOVT.'s TAX !!!
20) Qus.: Delayed any time Paying Any Tax? Ans. : Yes Tax : PAY INTEREST & PENALTY!
21) INDIAN :: Can I Die Now?? Ans :: Wait a while, Pronobda is about to launch the funeral tax!!!