Taxation Amendments

INCOME TAX
& GST
AMEDMENTS
(Applicable For CA INTER & IPCC May 2020 Exams)
By
CA VINOD KUMAR M
GURUKUL FOR CA & CMA INCOME TAX AMENDMENTS 1
INTRODUCTION TO INCOME TAX
RATES OF TAXATION
1. Tax rates
Senior citizen resident

Super senior citizen
i.e. aged 60 years or Other (Individual, HUF, AOP, BOI,
Rate i.e. resident aged 80
more but less than 80 Artificial Juridical Person).
years or more
years
Nil Up to Rs.5,00,000 Up to Rs.3,00,000 Up to Rs.2,50,000
5% NA 3,00,001 – 5,00,000 2,50,001 – 5,00,000
20% 5,00,001 – 10,00,000 5,00,001 – 10,00,000 5,00,001 – 10,00,000
30% Above 10,00,000 Above 10,00,000 Above 10,00,000
2. Firm/LLP
On the whole of the total income 30%
3. Local authority
On the whole of the total income 30%
4. Co-operative Society
Where the total income does not exceed 10% of the total income
Rs.10,000
Where the total income exceeds 10,000 but Rs.1,000 plus 20% of the amount by which the
does not exceed Rs.20,000. total income exceeds Rs.10,000
Where the total income exceeds Rs.20,000 Rs.3,000 plus 30% of the amount by which the
total income exceeds Rs.20,000
5. Company
In the case of a domestic company

If the Total Turnover or Gross receipts of the PY 2017 -18 does 25%
not exceed Rs.400 crore
In all other cases 30%
In case of other than a domestic company 40% on the Total Income
Rebate of income-tax in case of certain individuals (Section 87A)

1. Eligible Assessee: Resident Individual, whose total income does not exceed Rs.5,00,000.
2. Amount of rebate: Lower of;
(a) 100% of Income tax; or
(b) Rs.12,500.
SURCHARGE
Individual/HUF/AOP Firm/ Co-Operation Society/

Company
/BOI/AJP Local authority
TI > 1 Cr but not TI up to

TI up to 1 Cr. TI >10 Cr. TI > 1 Cr.
exceed 10 Cr. 1 Cr.
Total Income Surcharge
Rate
Up to 50 Lakhs. Nil
> 50 Lakhs but No Domestic Foreign Domestic Foreign No 12%
10 %
not exceed 1 Cr. Surcharge Company Company Company Company Surcharge
> 1 Cr. but not 15%
exceed 2 Cr.
> 2 Cr but not 25% 7% 2% 12% 5%
exceed 5 Cr.
> 5 Cr. 37%
According to this Press Release, the enhanced surcharge of 25% and 37% on Income-tax, as the case may
be, applicable where the total income of Individuals/HUFs/ AOPs/BoIs/Artificial Juridical persons exceeds
Rs. 2 crore and Rs. 5 crore, respectively, has been withdrawn on income-tax payable at special rates on
short-term capital gain under section 111A and long-term capital gains under section 112A arising from the
transfer of equity share in a company or unit of an equity-oriented fund/ business trust, which has been
subject to securities transaction tax.
Consequently, the manner of computation of surcharge on income-tax, in case of Individuals /HUFs/
AOPs/BoIs/Artificial Juridical persons for A.Y.2020-21 would be as follows:
Rate of
Components of total Applicable rate of
Particulars surcharge
Income Surcharge
on income tax
(i) Where the total income 10%  STCG u/s 111A Rs. 30 lakhs; Surcharge would be
(including income under  LTCG u/s 112A Rs. 25 lakhs; levied@10% on income-tax
section 111A and 112A) and computed on total income of
> Rs. 50 lakhs but ≤ Rs. 1
 Other income Rs. 40 lakhs Rs. 95 lakhs.
crore
(ii) Where total income 15%  STCG u/s 111A Rs. 60 lakhs; Surcharge would be
section 111A and 112A) and computed on total income of
exceeds Rs. 1 crore but
 Other income Rs. 50 lakhs Rs. 1.75 crores.
does not exceed Rs. 2
crore
(iii) Where total income 25%  STCG u/s 111A Rs. 54 lakh; Surcharge would be levied
(excluding income under  LTCG u/s 112A Rs. 55 lakh; @15% on income-tax on:
section 111A and 112A) and  STCG of Rs. 54 lakhs
exceeds Rs. 2 crore but chargeable to tax u/s
 Other income Rs. 3 crores
does not exceed Rs. 5 Not 111A; and
crore. exceeding  LTCG of Rs. 55 lakhs
15% chargeable to tax u/s
The rate of surcharge on 112A.
the income-tax payable Surcharge@25% would be
on the portion of income leviable on income-tax
chargeable to tax under computed on other income of
section 111A and 112A Rs. 3 crores included in total
income
(iv) Where total income 37%  STCG u/s 111A Rs. 50 lakhs; Surcharge@15% would be
(excluding income under  LTCG u/s 112A Rs. 65 lakhs; levied on income-tax on:
section 111A and 112A) and  STCG of Rs. 50 lakhs
exceeds Rs. 5 crore  Other income Rs. 6 crore chargeable to tax u/s
111A; and
Rate of surcharge on the  LTCG of Rs. 65 lakhs
income-tax payable on chargeable to tax u/s
the portion of income 112A.
chargeable to tax under Not Surcharge@37% would be
section 111A and 112A exceeding leviable on the income-tax
15% computed on other
income of Rs. 6 crores
included in total income.
(v) Where total income 15%  STCG u/s 111A Rs. 60 lakhs; Surcharge would be
section 111A and 112A) and computed on total
exceeds Rs. 2 crore in  Other income Rs. 1.10 crore income of Rs. 2.25 crore.
cases not covered under
(iii) and (iv) above
INCOME FROM SALARIES

Standard Deduction
A standard deduction of Rs 50,000 or the amount of salary, whichever is lower, is to be provided
to the employees.
INCOME FROM HOUSE PROPERTY
Self-Occupied Property[Section 23(2)]

Where the property consists of a house or part of a house which
(a) Is in the occupation of the owner for the purposes of his own
residence; or
(b) Cannot actually be occupied by the owner by reason of the
fact that owing to his employment, business or profession
carried on at any other place, he has to reside at that other
place in building not belonging to him,
The annual value of such house or part of the house shall be
taken to be NIL.
Since here annual value will be NIL, hence municipal taxes paid have no relevance
Deemed to be let-out property [Section23 (4)]

Where more than 2 house is self-occupied by the assessee than;
a) The provisions of Section 23(2) shall apply only in respect of 2 of such houses, which the
assessee may, at his option, specify in this behalf
b) The annual value of the other house(s) shall be determined under section23 (1) as if such
houses (s) had been let out.
Pre-construction/ Acquisition interest:

It means interest paid before the year in which construction was completed. It is allowed in Five
equal instalments from the year in which construction was completed.
Maximum limits for deduction u/s 24 for Interest
If HP is Y Total Interest allowed

LOP/DLOP as deduction without
any limit.
N
If H.P. is SOP and Y Interest on Housing loan
satisfying the ‘3’ up to maximum of
conditions. Rs.2,00,000.
N
Interest on Housing
loan up to maximum of
Rs.30,000.
3 Conditions:
1. Loan taken for acquisition or construction of House Property.
2. On or after 01.04.1999.
3. Acquisition or Construction should be completed within 5 years from the end of the financial year in
which capital was borrowed.(W.e.f.A.Y.2017 -18)
Special note: Interest limit of 2,00,000/30,000 applicable for all SOPs.
Illustration
Ganesh has three houses, all of which are self-occupied. The particulars of the houses for the P.Y. 2019-
20 are as under:
Particulars House I House II House III
Municipal valuation p.a. Rs. 3,00,000 Rs. 3,60,000 Rs. 3,30,000
Fair rent p.a. Rs. 3,75,000 Rs. 2,75,000 Rs. 3,80,000
Standard rent p.a. Rs. 3,50,000 Rs. 3,70,000 Rs. 3,75,000
Date of completion/purchase 31.3.1999 31.3.2001 01.4.2014
Municipal taxes paid during the year 12% 8% 6%
Interest on money borrowed for repair of property - 55,000
during the current year
Interest for current year on money borrowed in July 1,75,000
2013 for purchase of property
Compute Ganesh’s income from house property for A.Y.2020-21 and suggest which houses should be
opted by Ganesh to be assessed as self-occupied so that his tax liability is minimum.
Solution:
Let us first calculate the income from each house property assuming that they are deemed to be let out.
Computation of income from house property of Ganesh for the A.Y. 2020-21
Particulars Amount in Rs.
House I House II House III
Gross Annual Value (GAV)
ER is the GAV of house property
ER = Higher of MV and FR, but restricted to SR 3,50,000 3,60,000 3,75,000
Less: Municipal taxes (paid by the owner during the previous year) 36,000 28,800 19,800
Net Annual Value (NAV) 3,14,000 3,31,200 3,55,200
Less: Deductions under section 24
(a) 30% of NAV 94,200 99,360 1,06,560
(b) Interest on borrowed capital - 55,000 73,640
Income from house property 2,19,800 1,76,840 73,640
Ganesh can opt to treat any two of the above house properties as self-occupied .
OPTION 1 (House I and II– self-occupied and House III – deemed to be let out)
If House I and II are opted to be self-occupied, the income from house property shall be –
House I (Self-occupied) Nil
House II (Self-occupied) (Interest deduction restricted to Rs.30,000) (30,000)
House III (Deemed to be let-out) 73,640
Income from house property 43,640
OPTION 2 (House I and III – self-occupied and House II – deemed to be let out)
If House I and III are opted to be self-occupied, the income from house property shall be –
House I (Self-occupied) Nil
House II (Deemed to be let-out) 1,76,840
House III (Self-occupied) (1,75,000)
OPTION 3 (House II and III – self-occupied and House I – deemed to be let out)
If House II and III are opted to be self-occupied, the income from house property shall be –
House I (Deemed to be let-out)
House II (Self occupied) (interest deduction restricted to Rs.30,000) (30,000)
House III (Self occupied) (1,75,000) (1,75,000)
(Total interest deduction restricted to Rs.2,00,000) (2,00,000)
Since Option 2 is most beneficial, Ganesh should opt to treat House I and III as self-occupied and House II as
deemed to be let out. His income from house property would be Rs.1,840 for the A.Y. 2020-21.
PGBP
Certain Deductions to be allowed only on Actual Payment [Section 43B]

In respect of the following sums payable by an assessee, deduction is allowable only if the sum is actually
paid on or before the due date of filing of return under section 139(1).
a. Tax, duty, cess or fee, under any law for the time being in force; or;
b. Contribution to any provident fund or superannuation fund or gratuity fund or any other fund for the
welfare of employees; or;
c. Bonus or commission for services rendered by employees,
d. Interest on any loan or borrowing from any public financial institution or a State Financial Corporation or
a State Industrial Investment Corporation, in accordance with the terms and conditions of the
agreement governing such loan or borrowing; or;
e. Any sum payable by the assessee as interest on any loan or borrowing from a deposit taking non-
banking financial company or systemically important non-deposit taking non-banking financial
company, in accordance with the terms and conditions of the agreement governing such loan or
borrowing,
f. Interest on any loan or advance from a scheduled bank or co-operative bank other than a primary
agricultural credit society or a primary co-operative agricultural and rural development bank on actual
payment basis.
g. Payment in lieu of any leave at the credit of his employee.
h. Sum payable to Indian Railways for use of railway assets.
(Effective from: A.Y.2017-18)
Note:
1. If the payment is not made as stipulated above then no deduction shall be allowed in respect of
outstanding liability while determining business income for that relevant previous year. However, the
Assessee can claim the deduction in the year of payment.
2. Where the interest on the loan is converted into a loan, interest so converted will not be treated as
having been actually paid, and accordingly, will not be allowed as a deduction.
Deposit taking non- A non-banking financial company which is accepting or holding public
banking financial deposits and is registered with the RBI under the provisions of the Reserve
company Bank of India Act, 1934.
Systemically important Non-banking financial company which is not accepting or holding public
non-deposit taking non- deposits and having total assets of not less than Rs.500 crore rupees as per
banking financial the last audited balance sheet and is registered with the RBI under the
company provisions of the Reserve Bank of India Act, 1934.
Increased rate of depreciation in respect of motor vehicles acquired and put to use during the
period from 23.8.2019 to 31.3.2020 [Notification 69/2019 dated 20.9.2019]
S.No Particulars Depreciation allowable

as a % of WDV
(i) Motor cars other than those used in a business of running 30%
them on hire, [acquired during the period from 23.8.2019 to
31.3.2020 and put to use on or before 31.3.2020]
Note – For motor cars, other than those used in a business of
running them on hire acquired or put to use on or after
1.4.1990, except those covered in (i) above, the rate of
depreciation would continue to be 15%
(ii) Motor buses, motor lorries and motor taxis used in a 45%
business of running them on hire, acquired during the period
from 23.8.2019 to 31.3.2020 and put to use on or before
31.3.2020
Note – For motor buses, motor lorries and motor taxis used in
a business of running them on hire, except those covered in
(ii) above, the rate of depreciation would continue to be 30%.
CAPITAL GAINS
Indexation
Financial Year Cost Inflation Index

2019-20 289
Capital Gains on sale of residential house [Section 54]
1. Eligible assesses Individual & HUF

2. Old asset & Conditions to  There should be a transfer of residential house (buildings or
be fulfilled: lands appurtenant thereto)
 It must be a long-term capital asset
 Income from such house should be chargeable under the
head “Income from house property”
3. New asset & Time limit Where the amount of capital gains exceeds Rs.2 crore
Where the amount of capital gain exceeds Rs.2 crore, one
residential house in India should be –
 Purchased within 1 year before or 2 years after the date of
transfer (or)
 Constructed within a period of 3 years after the date of
transfer.
Where the amount of capital gains does not exceed Rs.2 crore
Where the amount of capital gains does not exceed Rs.2 crore,
the assessee i.e., individual or HUF, may at his option,
 Purchase two residential houses in India within 1 year before

or 2 years after the date of transfer (or)
 construct two residential houses in India within a period of 3
years after the date of transfer.
Where during any assessment year, the assessee has exercised
the option to purchase or construct two residential houses in
India, he shall not be subsequently entitled to exercise the option
for the same or any other assessment year.
4. Quantum of Exemption Capital gain or amount of investment whichever lower
5. Consequences of transfer If the new asset is transferred before 3 years from the date of its
of new asset before 3 acquisition, then cost of the asset will be reduced by capital
years gains exempted earlier for computing capital gains.
6. CGAS If such investment is not made before the date of filing of return
of income, then the capital gain has to be deposited under the
CGAS.
DEDUCTIONS FROM GROSS TOTAL INCOME
Section 80 CCD
Contribution to pension scheme of Central Govt. / New pension scheme/ Atal pension Yojna.
a. Eligible assessee: Individual
b. Amount of deduction (Sec 80 CCD(1))
Salaried employee Other individuals
(i) Employees contribution xx (ii) Assessee’s contribution xx

(i) 10% of salary xx (ii) 20% of GTI xx
Section 80 CCD(1B)
Additional deduction up to Rs. 50,000 shall be allowed other than contributions covered under
section 80CCD (1)
Section 80 CCD(2)
Employer’s contribution to NPs for the benefit of employee.
Employer’s contribution is first taxable under the head salary in hands of employee & then he gets
deduction u/s 80 CCD (2)
Employer’s contribution xxx
Contributed by central government  14% of Salary xxx
Contributed by other employer  10% of Salary xxx
Note: For the purpose of Sec 80CCD (1) & (2), salary means = Basic salary + DA (in terms)
Notes:
Exemption on payment from NPS Trust to an Assessee on closure of his account or on his opting
out of the pension scheme [Section 10(12A)]:
Section 10(12A) provides that any payment from National Pension System Trust to an assessee on
account of closure or his opting out of the pension scheme referred to in section 80CCD, to the
extent it does not exceed 60% of the total amount payable to him at the time of closure or his
opting out of the scheme, shall be exempt from tax.
Additional deduction for interest on loan borrowed for acquisition of self-occupied house
property by an individual [Section 80EE]
1. Eligibile assessee: Individual
2. Amont od dedution: Max.50,000 per year.
3. The conditions to be satisfied for availing this deduction are as follows –
a. Loan should be taken from bank or financial institutions for acquisition of residential
property.
b. The assessee should not own any residential house on the date of sanction of loan
c. Value of house  Rs.50 Lakhs
d. Loan should be sanctioned during the P.Y.2016-17
e. Loan sanctioned  Rs.35 lakhs
4. The benefit of deduction under this section would be available till the repayment of loan
continues.
5. The deduction of upto Rs. 50,000 under section 80EE is over and above the deduction of upto
Rs 2,00,000 available under section 24 for interest paid in respect of loan borrowed for
acquisition of a self-occupied property.
Deduction in respect of interest payable on loan taken for acquisition of residential house
property [Section 80EEA]
(i) Eligible assessee: An individual who has taken a loan for acquisition of residential house
property from any financial institution. Interest payable on such loan would qualify for
deduction under this section.
(ii) Conditions: The conditions to be satisfied for availing this deduction are as follows –
a) The individual should not own any residential house on the date of sanction of loan.
b) The individual should not be eligible to claim deduction u/s 80EE
c) Loan should be sanctioned by a Financial Institution during the P.Y.2019-20.
d) Stamp Duty Value of house ≤ Rs.45 lakhs.
(iii) Period of benefit: The benefit of deduction under this section would be available from
A.Y.2020-21 and subsequent assessment years till the repayment of loan continues.
(iv) Quantum of deduction: The maximum deduction allowable is Rs.1,50,000. The deduction of
upto Rs.1,50,000 under section 80EEA is over and above the deduction available under section
24(b) in respect of interest payable on loan borrowed for acquisition of a residential house
property.
(v) No deduction under any other provision: The interest allowed as deduction under section
80EEA will not be allowed as deduction under any other provision of the Act for the same or
any other assessment year.
(vi) Meaning of certain terms:
a) Financial institution:
 A banking company to which the Banking Regulation Act, 1949 applies; or
 Any bank or banking institution referred to in section 51 of the Banking Regulation Act,
1949; or
 A housing finance company.
b) Housing finance company: A public company formed or registered in India with the main
object of carrying on the business of providing long-term finance for construction or
purchase of houses in India for residential purposes.
Deduction in respect of interest payable on loan taken for purchase of electric vehicle [Sec. 80EEB]
(i) Eligible Assessee: An individual who has taken a loan for purchase of an electric vehicle from
any financial institution. Interest payable on such loan would qualify for deduction under this
section.
(ii) Conditions: The conditions to be satisfied for availing this deduction are as follows –
a) Loan should be taken for purchase of an electric vehicle.
b) Loan should be sanctioned during the period between 1.4.2019 and 31.3.2023.
c) Loan should be sanctioned by a FI (bank or specified NBFCs)
d) The assessee should be an individual.
(iii) Period of benefit: The benefit of deduction under this section would be available from
A.Y.2020-21 and subsequent assessment years till the repayment of loan continues.
(iv) Quantum of deduction: Interest payable, subject to a maximum of Rs.1,50,000.
(v) No deduction under any other provision: The interest allowed as deduction under section
80EEB will not be allowed as deduction under any other provision of the Act for the same or
any other assessment year.
(vi) Meaning of certain terms:
a) Financial institution
 A banking company to which the Banking Regulation Act, 1949 applies; or
 Any bank or banking institution referred to in section 51 of the Banking Regulation Act,
1949; or
 Any deposit taking NBFC
 A systemically important non-deposit taking NBFC i.e., a NBFC which is not accepting or
holding public deposits and having total assets of not less than Rs.500 crore as per the
last audited balance sheet and is registered with the RBI
b) Electric Vehicle: A vehicle which is powered exclusively by an electric motor whose traction
energy is supplied exclusively by traction battery installed in the vehicle. The vehicle should
have electric regenerative braking system, which during braking provides for the
conversion of vehicle kinetic energy into electrical energy.
Illustration
The following are the particulars relating to Mr.A, Mr.B, Mr.C and Mr.D, salaried individuals, for
A.Y.2020-21 –
Particulars Mr.A Mr.B Mr.C Mr.D
Amount of loan taken Rs.43 lakhs Rs.45 lakhs Rs.20 lakhs Rs.15 lakhs
Loan taken from HFC Deposit taking Deposit taking Public sector
NBFC NBFC Bank
Date of sanction of loan 1.4.2019 1.4.2019 1.4.2019 30.3.2019
Date of disbursement of loan 1.5.2019 1.5.2019 1.5.2019 1.5.2019
Purpose of loan Acquisition of Acquisition of Purchase of Purchase of
residential house residential house electric electric
property for self property for self vehicle for vehicle for
occupation occupation personal use personal use
Stamp duty value of house Rs.45 Lakhs Rs.48 lakhs - -
property
Cost of electric vehicle - - Rs.22 lakhs Rs.18 lakhs
Rate of interest 9% p.a. 9% p.a. 10% p.a. 10% p.a.
Compute the amount of deduction, if any, allowable under the provisions of the Income-tax Act, 1961 for
A.Y.2020-21 in the hands of Mr. A, Mr. B, Mr. C and Mr. D. Assume that there has been no principal
repayment during the P.Y.2019-20.
Solution:
Mr. A Rs.
Interest deduction for A.Y.2020-21
(i) Deduction allowable while computing income under the head “Income from house
property”
Deduction u/s 24(b) Rs.3,54,750
[Rs.43,00,000 × 9% x 11/12]
Restricted to 2,00,000
(ii) Deduction under Chapter VI-A from Gross Total Income
Deduction u/s 80EEA Rs. 1,54,750
(Rs. 3,54,750 – Rs.2,00,000)
Mr. B
Interest deduction for A.Y.2020-21
(i) Deduction allowable while computing income under the head “Income from house
property”
Deduction u/s 24(b) Rs.3,71,250
[Rs.45,00,000 × 9% x 11/12]
(ii) Deduction under Chapter VI-A
Deduction u/s 80EEA is not permissible since:
a. Loan is taken from NBFC
b. Stamp duty value exceeds Rs.45 lakh. Nil
Deduction under section 80EEA would not be permissible due to either violation listed
above.
Mr. C Rs.
Deduction under Chapter VI-A
Deduction u/s 80EEB for interest payable on loan taken for purchase of electric vehicle [Rs.20 1,50,000
lakhs x 10% x 11/12 =Rs.1,83,333, restricted to Rs.1,50,000, being the maximum permissible
deduction]
Mr. D
Deduction under Chapter VI-A
Deduction u/s 80EEB is not permissible since loan was not sanctioned in the P.Y.2019-20. Nil
RETURN OF INCOME
Sec.139 (1):Filling of return of Income (ROI)

(a) For company & Partnership Firm (Including LLP) – Return filing is compulsory
(b) For other Assessee: If GTI[Before giving effect of Section 54/54B/54D/54EC or 54F] > Basic Exemption,
then return filing is compulsory.
(c) Any person other than a company or a firm, who is not required to furnish a return under section
139(1), is required to file income-tax return in the prescribed form and manner on or before the due
date if, during the previous year, such person –
a) Has deposited an amount or aggregate of the amounts exceeding Rs.1 crore in one or more current
accounts maintained with a banking company or a co-operative bank; or
b) Has incurred expenditure of an amount or aggregate of the amounts exceeding Rs.2 lakh for
himself or any other person for travel to a foreign country; or
c) Has incurred expenditure of an amount or aggregate of the amounts exceeding Rs.1 lakh towards
consumption of electricity; or
d) Fulfils such other prescribed conditions
Inter-changeability of PAN with the Aadhaar number
Every person who is required to furnish or intimate or quote his PAN may furnish or intimate or quote his
Aadhar Number in lieu of the PAN w.e.f. 1.9.2019 if he
 Has not been allotted a PAN but possesses the Aadhar number
 Has been allotted a PAN and has intimated his Aadhar number to prescribed authority in accordance
with the requirement contained in section 139AA(2).
PAN would be allotted in prescribed manner to a person who has not been allotted a PAN but possesses
Aadhar number.
Sec-140A:- Self- assessment tax
Tax payable on Income which is declared in ROI XXX
(-) Advance tax paid (XXX)
(-)TDS/TCS (XXX)
(-) Relief u/sec.89(1) (XXX)
(+)Late fee u/s 234 F XXX
(+) Interest u/s 234 A/B/C XXX
SAT u/s 140A XXX
ADVANCE TAX & INTEREST

1. Computation of advance tax u/s 209
Net tax liability on estimated Income XXX
(-) TDS/TCS (XXX)
Less: Relief u/sec.89(1) (XXX)
Advance tax payable XXX
Note:
In effect, only if tax has actually been deducted at source, the same can be reduced for computing
advance tax liability of the payee. Tax deductible but not so deducted cannot be reduced for computing
advance tax liability of the payee.
2. Assessee is required to pay Advance tax if his liability for advance tax is Rs.10000 or more.
Exemptions:
RESIDENT Senior Citizen not having income under the head “PGBP”.
3. Due dates of advance tax for all assessee w.e.f 1/6/16

Due dates Amount of advance tax
th
Upto 15 june of P.Y Upto 15% of advance tax liability
Upto 15th September of P.Y Upto 45% of advance tax liability
th
Upto 15 December of P.Y Upto 75% of advance tax liability
Upto 15th March of P.Y Upto 100% of advance tax liability
Notes:
Tax paid upto 31st March of P.Y is treated as advance tax only.
If Assessee opt sec 44AD/44ADA (Presumptive PGBP) then due of advance tax is 15th March of P.Y. (Only
one installment)
Interest for non-payment or short-payment of advance tax [Section 234B]

(1) Interest under section 234B is attracted for non-payment of advance tax or payment of advance tax
of an amount less than 90% of assessed tax.
(2) The interest liability would be 1% per month or part of the month from 1st April following the
financial year upto the date of determination of income under section 143(1).
(3) Such interest is calculated on the amount of difference between the assessed tax and the advance tax
paid.
(4) Assessed tax is the tax calculated on total income less
 Tax deducted or collected at source.
 Any relief of tax allowed under section 89
Interest payable for deferment of advance tax [Section 234C]
Specified date Specified % Shortfall in advance tax Period

(1) (2) (3) (4)
15th June 15% 15% of tax due on returned income (-) advance 3 months
tax paid up to 15th June
15th September 45% 45% of tax due on returned income (-) advance 3 months
tax paid up to 15th September
15th December 75% 75% of tax due on returned income (-) advance 3 months
tax paid up to 15th December
15th March 100% 100% of tax due on returned income (-) advance 1 month
tax paid up to 15th March
Note:
However, if the advance tax paid by the assessee on the current income, on or before 15th June or 15th
September, is not less than 12% or, as the case may be, 36% of the tax due on the returned income, then,
the assessee shall not be liable to pay any interest on the amount of the shortfall on those dates.
Meaning of tax due on returned income
Tax due on returned income means the tax calculated on total income declared in the return furnished by
the assessee less
 Tax deducted or collected at source.
 Any relief of tax allowed under section 89
TDS
Payment made by an individual or a HUF for contract work or by way of fees for professional services or
commission or brokerage [Sec. 194M]
1) Applicability and rate of TDS: Section 194M, inserted with effect from 1.9.2019, provides for
deduction of tax at source @5% by an individual or a HUF responsible for paying any sum
during the financial year to any resident –
(i) For carrying out any work (including supply of labour for carrying out any work) in
pursuance of a contract; or
(ii) By way of commission (not being insurance commission referred to in section 194D) or
brokerage; or
(iii) By way of fees for professional services.
It may be noted that only individuals and HUFs (other than those who are required to deduct
income-tax as per the provisions of section 194C or 194H or 194J) are required to deduct tax
in respect of the above sums payable during the financial year to a resident.
2) Time of deduction: The tax should be deducted at the time of credit of such sum or at the
time of payment of such sum, whichever is earlier.
3) Threshold limit: No tax is required to be deducted where such sum or, as the case may be,
aggregate amount of such sums credited or paid to a resident during the financial year does
not exceed Rs.50,00,000.
Illustration:
Examine whether TDS provisions would be attracted in the following cases, and if so, under which
section. Also specify the rate of TDS applicable in each case. Assume that all payments are made to
residents.
S.no. Particulars of the payer Nature of payment Aggregate of payments
made in the F.Y.2019-20
1 Mr. Ganesh, an individual Contract Payment for repair of Rs.5 lakhs
carrying on retail business residential house
with turnover of Rs. 2.5 crores Payment of commission to Mr. Rs.80,000
in the P.Y.2018-19 Vallish for business purposes
2. Mr. Rajesh, a wholesale Contract Payment for Rs.20 lakhs in January,
trader who declares profits reconstruction of residential 2020, Rs.15 lakhs in Feb
under section 44AD for house (made during the period 2020 and Rs.20 lakhs in
P.Y.2018-19 and P.Y.2019- 20. January- March, 2020) March 2020.
3. Mr. Satish, a salaried Payment of brokerage for buying Rs.51 lakhs
individual a residential house in March,
2020
4. Mr. Dheeraj, a pensioner Contract payment made during Rs.48 lakhs
October-November 2019 for
reconstruction of residential
house
Solution:
Particulars Nature of Aggregate of Whether TDS provisions are attracted?

of the payment payments made
payer in the F.Y.2019-
20
1 Mr. Contract Rs.5 lakhs No, TDS under section 194C is not attracted since the
Ganesh, Payment for payment is for personal purpose and TDS under
an repair of section 194M is not attracted as aggregate of
individual residential contract payment to the payee in the P.Y.2019-20
carrying house does not exceed Rs.50 lakh.
on retail Payment of Rs.80,000 Yes, u/s 194H, since the payment exceeds Rs.15,000,
business commission to and Mr. Ganesh’s turnover exceeds Rs.1 crore in the
with Mr. Vallish for P.Y.2018-19.
turnover business
of Rs. 2.5 purposes
crores in
the
P.Y.2018-
19
2 Mr. Contract Rs.20 lakhs in Yes, under section 194M, since the aggregate of
Rajesh, a Payment for January, 2020, payments (i.e., Rs.55 lakhs) exceed Rs.50 lakhs, and
wholesale reconstruction Rs.15 lakhs in the payments are made after 1.9.2019. Since he
trader of residential Feb 2020 and declares profits on presumptive basis under section
who house (made Rs.20 lakhs in 44AD, he is not subject to tax audit in the P.Y.2018-
declares during the March 2020. 19. Hence, TDS provisions under section 194C are
profits period not attracted in respect of payments made in the
under January- P.Y.2019-20.
section March, 2020)
44AD for
P.Y.2018-
19 and
P.Y.2019-
20.
3 Mr. Satish, Payment of Rs.51 lakhs Yes, under section 194M, since the payment of Rs.51
a salaried brokerage for lakhs made in March 2020 exceeds the threshold of
individual buying a Rs.50 lakhs. Since Mr. Satish is a salaried individual,
residential the provisions of section 194H are not applicable in
house in this case.
March, 2020
4 Mr. Contract Rs.48 lakhs TDS provisions under section 194C are not attracted
Dheeraj, a payment since Mr. Dheeraj is a pensioner and hence, not
pensioner made during subject to tax audit. TDS provisions under section
October- 194M are also not applicable in this case, since the
November payment of Rs.48 lakhs, even though made after
2019 for 1.9.2019, does not exceed the threshold of
reconstruction Rs.50 lakhs.
of residential
house
TDS on cash withdrawal [Section 194N]

1) Applicability and rate of TDS: Section 194N, inserted with effect from 1.9.2019, provides that every
person, being
 A banking company to which the Banking Regulation Act, 1949 applies (including any bank or
banking institution referred under section 51 of that Act)
 A co-operative society engaged in carrying on the business of banking o
 A post office
Who is responsible for paying, in cash, any sum or aggregate of sums exceeding Rs.1 crore during the
previous year to any person from one or more accounts maintained by such recipient-person with it,
shall deduct tax at source @2% of sum exceeding Rs.1 crore.
2) Time of deduction: This deduction is to be made at the time of payment of such sum.
3) Non-applicability of TDS under section 194N: Liability to deduct tax at source under section 194N shall
not be applicable to any payment made to –
 the Government
 any banking company or co-operative society engaged in carrying on the business of banking or a
post-office
 any business correspondent of a banking company or co-operative society engaged in carrying on
the business of banking, in accordance with the RBI guidelines
 any white label ATM operator of a banking company or co-operative society engaged in carrying on
the business of banking, in accordance with the authorisation issued by the RBI under the Payment
and Settlement Systems Act, 2007
 such other person or class of persons notified by the Central Government in consultation with the
RBI.
GURUKUL FOR CA & CMA GST AMENDMENTS 17
SUPPLY UNDER GST
Service by way of grant of Alcoholic Liquor License now declared to be ‘out of scope of supply’ and thus,
liquor license fee will not attract any GST liability
[Sec 7(2) of CGST Act read with N/N 25/2019-CT – dated 30th Sep, 2019]
In terms of section 7(2) of the CGST Act, the Government has notified the following activity or transaction
undertaken by the State Governments in which they are engaged as public authorities, to be treated
neither as a supply of goods nor a supply of service, namely:-
“Service by way of grant of alcoholic liquor licence, against consideration in the form of licence fee or
application fee or by whatever name it is called.”
Note: It may be noted that services provided by the Government to business entities including by way of
grant of privileges, licences, mining rights, natural resources such as spectrum etc. against payment of
consideration in the form of fee, royalty etc. are taxable under GST. Tax is required to be paid by the
business entities on such services under reverse charge.
Levy of GST on the service of display of name or placing of name plates of the donor in the premises of
charitable organisations receiving donation or gifts from individual donors.
[Circular No. 116/35/2019-GST]
Simplified version
Charitable Organization / Religious institutions / Others (receipt of donations/ gifts from individual donor
– taxability thereof)
Gifts/ donations acknowledged by placing name plates in name of individual donor

Situation 1 3 Conditions test:
GST not (1) The gift or donation is made to a charitable organization,
Leviable (2) The payment has the character of gift or donation and
(3) The purpose is philanthropic (i.e. it leads to no commercial gain) and not
advertisement
 Name plate is simple expression of gratitude and public recognition
of donor’s act of philanthropy
 It is not aimed at giving publicity in a manner that it would be an
advertisement or promotion of donor’s business.
Then, this activity will not fall within scope of supply – GST not leviable
Situation- 2  Other cases – GST shall be leviable
GST leviable  Where name plate is aimed at promoting business of donor, then this
activity will fall within scope of supply (supply of advertisement service)
and thus, GST will be leviable.
Some examples of cases where there would be no taxable supply are as follows:-
(i) “Good wishes from Mr. Rajesh” printed underneath a digital blackboard donated by Mr.
Rajesh to a charitable Yoga institution.
(ii) “Donated by Smt. Malati Devi in the memory of her father” written on the door or floor of a
room or any part of a temple complex which was constructed from such donation.
REVERSE CHARGE
1. Legal Services
Services by Arbitral
Tribunal
To Business Entity To CG/SG/LA/UT/GA To Non-Business Entity
Exempt Exempt
ATO upto such amount in the ATO upto such amount in the preceding FY as
preceding FY as makes it eligible for makes it not eligible for exemption from
exemption from registration registration.
Taxable (Under RCM

Exempt
business entity is liable)
Service provided by individual advocate or firm of advocate other than Senior Advocate
To Business To Non Business To CG /SG /LA/ To another individual

Entity Entity UT/ GA advocate or firm of advocate
Exempt Exempt Exempt
ATO upto such amount in ATO upto such amount in the

the preceding FY as makes it preceding FY as makes it not
eligible for exemption from eligible for exemption from
registration registration.
Exempt Taxable under RCM
Service provided by Senior Advocate
To Business To Non Business To CG /SG /LA/ To another individual

Entity Entity UT/ GA advocate or firm of advocate
Exempt Exempt Taxable But Advocate/Firm

can take exemption upto
turnover 20 Lacs as a
business entity(RCM)
ATO upto such amount in ATO upto such amount in the

the preceding FY as makes preceding FY as makes it not
it eligible for exemption eligible for exemption from
from registration registration.
Exempt Taxable under RCM

Illustration-1:
X is an advocate (other than senior advocate) in Calcutta High Court. During December 20XX, he provides
legal service to following:
(1) Mr A (non-business entity);
(2) A & Co. (business entity – advocate firm). Turnover of A & Co. for the preceding financial year is Rs.
28 lakh
(3) C Ltd. (business entity – supplier of garments). Turnover of C Ltd. (Haryana) for the preceding
financial year is Rs. 28 lakh.
(4) Z Ltd. (business entity – supplier of garments). Turnover of Z Ltd. (Chandigarh) for the preceding
financial year is Rs. 22 lakh.
(5) CG (business entity). Turnover in crores.
Services by an advocate (other than senior advocate):
(1) Exempt;
(2) Exempt (recipient being advocate firm, TO in PY is not relevant);
(3) GST Exempt (recipient C Ltd. being exclusive supplier of goods who is entitled to registration
exemption threshold of 40 lakhs and since is ATO (PY) is not exceeding that limit, legal service to such
recipient shall be exempt);
(4) GST Exempt (recipient Z Ltd. being exclusive supplier of goods who is entitled to registration
exemption threshold of 40 lakhs and since is ATO (PY) is not exceeding that limit, legal service to such
recipient shall be exempt);
(5) Exempt (recipient being CG, TO in the PY is not relevant).
Illustration-2:
X is a senior advocate in the Bombay High Court. A firm of advocates which is fighting the case of reliance
industry (supplier of goods and services) has approached X (senior advocate) to provide legal assistance
in relation of matter of its client, Reliance Industries Ltd.
 ATO of Advocate Firm in the PY is Rs 200 Lakhs.
• ATO of RIL in the PY is 23000 Crores.
Supplier = Senior Advocate
Recipient = Advocate Firm (TO of PY more than 20 Lakhs) (it is actual recipient as it is liable to pay fees to
the supplier senior advocate)
Exemption = Not available (as legal service to business entity and ATO of PY is more than 20 lakhs-
applicable threshold limit of exemption from registration)
Thus, GST shall be payable on such service.
Further, since supply of service is to business entity, RCM shall be applicable in terms of Sec 9(3) of CGST
Act / Sec 5(3) of IGST Act.
However, for purposes of RCM, the litigant (RIL) shall be deemed to be recipient (explanation to the
notification issued u/Sec 9(3) of CGST Act or Sec 5(3) of IGST Act). Thus, under RCM, RIL shall be liable to
pay GST on supply of service by senior advocate.
Author, music composer
Sl. No. Category of supply of services Supplier of Recipient of

service service
9 Supply of services by a music composer, Music composer, Music company,
photographer, artist or the like by way of transfer or photographer, producer or the
permitting the use or enjoyment of a copyright artist, or the like like, located in the
covered under clause (a) of subsection (1) of section taxable territory
13 of the Copyright Act, 1957 relating to original
dramatic, musical or artistic works to a music
company, producer or the like.
Simultaneously, a new entry has been inserted for transfer of copyright by an author to publisher. The new
entry reads as under:
Sl. No. Category of Supply of Services Supplier of service Recipient of Service
9A Supply of services by an author by way of Author Publisher located in
transfer or permitting the use or enjoyment of a the taxable territory
copyright covered under clause (a) of sub -
section (1) of section 13 of the Copyright Act,
1957 relating to original literary works to a
publisher
However, an author can choose to pay tax under forward charge if-
(i) He has taken registration under the CGST Act and filed a declaration, in the prescribed form, that he
exercises the option to pay CGST on the said service under forward charge in accordance with section
9(1) of the CGST Act and to comply with all the provisions as they apply to a person liable for paying
the tax in relation to the supply of any goods and/or services and that he shall not withdraw the said
option within a period of 1 year from the date of exercising such option;
(ii) He makes a declaration on the invoice issued by him in prescribed form to the publisher.
New services under reverse charge mechanism
Sl. No. Category of supply of services Supplier of service Recipient of service

15 Services provided by way of Any person other than a body Anybody corporate
renting of a motor vehicle corporate, who is paying CGST located in the taxable
provided to a body corporate @ 2.5% on renting of motor territory
vehicles with input tax credit
only of input service in the
same line of business
16 Services of lending of securities Lender i.e., a person who Borrower i.e., a person
under Securities Lending deposits the securities who borrows the
Scheme, 1997 (“Scheme”) of registered in his name or in the securities under the
Securities and Exchange Board name of any other person duly Scheme through an
of India, as amended authorised on his behalf with approved intermediary of
an approved intermediary for SEBI
the purpose of lending under
the Scheme of SEBI
Taxation of Service of RENTING OF MOTOR VEHICLE

GST liability
Applicable rate: As notified on recommendation of GST Council
N/N 11/2017- CT (rate): Heading 9966
Services of renting of Motor Vehicle CGST SGST IGST RCM
Renting of any motor vehicle designed to 2.5% 2.5% 5% RCM Applicable
carry passengers (Fuel cost is borne the (if Supplier is non-Body
supplier and charged as part of rental bills) corporate entity and
[No ITC allowed except ITC of input service recipient is a body
in same line of business (i.e. procured corporate)
service transporting passengers in a motor
vehicle or renting of a motor vehicle)]
Other cases 9% 9% 18% RCM Not applicable
[Full ITC allowed] (Supplier shall pay)
Service of lending of SECURITY (by LENDER to BORROWER) – RCM inserted vide Entry No. 16
Composition Scheme
Now a manufacturer of aerated water (Tariff item 2202 1010) will also not be eligible to opt for
composition scheme.
EXEMPTIONS
Clarification on the effective date of insertion of explanation in notification

 Section 11(3) of CGST Act provides that the Government may insert an explanation in any
notification issued under section 11, for the purpose of clarifying its scope or applicability, at
any time within 1 year of issue of the notification and every such explanation shall have effect
as if it had always been the part of the first such notification.
 It is hereby clarified that the explanation having been inserted under section 11(3) of the
CGST Act, is effective from the inception of the entry in notification and not from the date
from which the notification (that inserted said explanation) becomes effective.
For example, the principal Notification No. 11/2017 CT (R) dated 28.06.2017 came into force with
effect from 1.07.2017. Thereafter, a new entry - Entry no. 3(vi) is inserted w.e.f. 21.09.2017.
Subsequently, an explanation is also inserted with respect to entry no. 3(vi) on 26.07.2018.
Although the effective date mentioned in the notification which inserted said explanation is
27.07.2018, said explanation will be effective from the inception of entry in notification i.e.
21.09.2017 and not 27.07.2018.
[Circular No. 120/39/2019 GST dated 11.10.2019]
Entry No. 24-B (Storage and warehousing of certain goods)
Services by way of storage and warehousing of
 Cereals, pulses,
 Fruits, nuts and vegetables,
 Spices, copra,
 Sugarcane, jaggery,
 Raw vegetable fibres such as cotton, flax, jute etc.,
 Indigo,
 Unmanufactured tobacco, betel leaves, tendu leaves,
 Coffee and tea.
Status of Storage & Warehousing Services

Agricultural Produce (defined in E/N – Para 2(d)) Exempt vide E/N 54 .
Non-Agricultural Produce Rice Exempt vide E/N 24
Minor Forest Produce Exempt vide E/N 24-A
Certain other specified products Exempt vide E/N 24-B (New Entry)
All others GST Payable
Life insurance business services

New Entry 29B: Services of life insurance provided/agreed to be provided by the Central Armed
Police Forces (under Ministry of Home Affairs) Group Insurance Funds to their members under the
Group Insurance Schemes of the concerned Central Armed Police Force.
General insurance business services

Bangla Shasya Bima
Giving Motor Vehicle on hire basis to
STATE TRANSPORT GTA Motor vehicle for transport if

UNDERTAKING (For transportation of students, faculty and staff, to a
(Seating Capacity more than 12 goods) person providing services of
passenger) transportation of student,
To a local authority, an Electrically faculty and staff to an
operated vehicle (EOV) meant to educational institution
carry more than 12 passengers;
providing services by way of
pre-school education and
education upto higher
secondary school or equivalent
Services by an unincorporated body or a non- profit entity
 Entry no. 77:
Service by an unincorporated body or a non- profit entity To its own

registered under any law members
a. as a trade union
b. Carrying out any activity which is exempt from GST.
c. up to an amount of Rs.7,500 per month per member
for sourcing of goods or services from a third person Consideration=
for the common use of its members in a housing reimbursement of
society or a residential complex. charges or share of
contribution
Clarification on issues related to GST on monthly subscription/ contribution charged by a

Residential Welfare Association from its members
Issue Clarification
Are the maintenance charges paid by Supply of service by RWA (unincorporated body or a
residents to the Resident Welfare non-profit entity registered under any law) to its own
Association (RWA) in a housing society members by way of reimbursement of charges or share
exempt from GST and if yes, is there an upper of contribution up to an amount of Rs. 7,500/- per
limit on the amount of such charges for the month per member for providing services and goods for
exemption to be available? the common use of its members in a housing society or a
residential complex are exempt from GST.
A RWA has aggregate turnover of Rs. 20 lakh No. If aggregate turnover of an RWA does not exceed
or less in a FY. Is it required to take Rs.20 Lakh in a FY, it shall not be required to take
registration and pay GST on maintenance registration and pay GST even if the amount of
charges if the amount of such charges is maintenance charges exceeds Rs. 7,500/- per month per
more than Rs. 7500/- per month per member. RWA shall be required to pay GST on monthly
member? subscription/ contribution charged from its members,
only if such subscription is more than Rs. 7,500/- per
month per member and the annual aggregate turnover
of RWA by way of supplying of services and goods is also
Rs. 20 lakh or more.
Annual turnover Monthly Whether
of RWA maintenance exempt?
charge
More than More than No
Rs. 20 lakhs Rs. 7,500/-
Rs. 7,500/- or less Yes
Rs. 20 lakhs or less More than Yes
Rs. 7,500/-
Rs. 7,500/- or less Yes
Is the RWA entitled to take ITC of GST paid RWAs are entitled to take ITC of GST paid by them on
on input and services used by it for making capital goods (generators, water pumps, lawn furniture
supplies to its members and use such ITC for etc.), goods (taps, pipes, other sanitary/hardware fillings
discharge of GST liability on such supplies etc.) and input services such as repair and maintenance
where the amount charged for such supplies services.
is more than Rs. 7,500/- per month per
member?
Where a person owns 2 or more flats in the As per general business sense, a person who owns 2 or
housing society/residential complex, whether more residential apartments in a housing
the ceiling of Rs. 7,500/- per month per society/residential complex shall normally be a member
member on the maintenance for the of the RWA for each residential apartment owned by
exemption to be available shall be applied him separately.
per residential apartment or per person? The ceiling of Rs. 7,500/- per month per member shall
be applied separately for each residential apartment
owned by him.
For example, if a person owns 2 residential apartments
in a residential complex and pays Rs. 15,000/- per month
as maintenance charges towards maintenance of each
apartment to the RWA (Rs. 7,500/- per month in respect
of each residential apartment), the exemption from GST
shall be available to each apartment.
[Circular No. 109/28/2019 GST dated 22.07.2019]
Entry no.14: Services by a hotel, inn, guest house, club or campsite, by whatever name called, for
residential or lodging purposes, having Tariff price of a unit of accommodation upto Rs.1,000 per
day or equivalent.
Note: Tariff price means price without deduction of discount.

FIFA
New Entry 9AA: Services provided by and to Fédération Internationale de Football Association (FIFA) and
its subsidiaries directly or indirectly related to any of the events under FIFA U-17 Women’s World Cup 2020
to be hosted in India.
Condition to be fulfilled: Director (Sports), Ministry of Youth Affairs and Sports have to certify that the
services are directly or indirectly related to any of the events under FIFA U-17 Women’s World Cup 2020.
New Entry 82A: Services by way of right to admission to the events organised under FIFA U-17 Women's
World Cup 2020.
Clarification on applicability of GST exemption to the DG Shipping approved maritime courses conducted
by Maritime Training Institutes of India - [Circular No. 117/36/28/2019- GST]
Simplified version of amendment
Courses conducted by Maritime Training Institutes of India: Exempt vide Entry o. 66
(as their services from part of a curriculum for obtaining a legally recognized qualification)
 The Maritime Training Institutes and their training courses are approved by the Director General of
Shipping which are duly recognized under the provisions of the Merchant Shipping Act, 1958 read
with the Merchant Shipping (standards of training, certification and watch-keeping for Seafarers)
Rules, 2014.
 Therefore, the Maritime Institutes are educational institutions under GST Law and the courses
conducted by them are exempt from levy of GST. The exemption is subject to meeting the conditions
specified at Sl. No. 66 of the notification No. 12/ 2017- Central Tax (Rate) dated 28.06.2017.
VALUE OF SUPPLY
GST treatment of such additional / penal interest: CBIC Circular

Situation Amendment
If the seller himself grants Additional / penal interest charged will form part of value of
EMI Installments supply (of goods) in terms of Sec 15(2)(d) of CGST Act.
[This will be so even if interest is charged separately]
If loan is provided by a Seller is out of picture with sale/supply of goods.
finance company directly to Buyer pays EMI and penal interest to finance company/Bank –
the buyer such interest (including penal interest) is exempt under Entry
No. 27 of E/N 12/2017-CT6.
Clarification regarding applicability of GST on delayed payment charges in case of late payment of
Equated Monthly Instalments (EMI)
Illustration-1: X sells a mobile phone to Y. The cost of mobile phone is Rs. 40,000/-. However, X
gives Y an option to pay in installments, Rs. 11,000/- every month before 10th day of the following
month, over next four months (Rs. 11,000/- × 4 = Rs. 44,000/-). As per the contract, if there is any
delay in payment by Y beyond the scheduled date, Y would be liable to pay additional/ penal
interest amounting to Rs. 500/- per month for the delay.
In some instances, X is charging Y Rs. 40,000/- for the mobile and is separately issuing another
invoice for providing the services of extending loans to Y, the consideration for which is the
interest of 2.5% per month and an additional/ penal interest amounting to Rs. 500/- per month for
each delay in payment.
 An EMI is a fixed amount paid by a borrower to a lender at a specified date every calendar
month. EMIs are used to pay off both interest and principal every month, so that over a
specified period, the loan is fully paid off along with interest. In cases where the EMI is not
paid at the scheduled time, there is a levy of additional / penal interest on account of delay in
payment of EMI.
 It implies that it would amount to a separate taxable supply of services under GST covered
under entry 5(e) of Schedule II of the CGST Act, 2017 i.e. “agreeing to the obligation to refrain
from an act, or to tolerate an act or a situation, or to do an act”.
 In this case, the amount of penal interest is to be included in the value of supply [i n terms of
section 15(2)(d)]. The transaction between X and Y is for supply of taxable goods i.e. mobile
phone. Accordingly, the penal interest would be taxable as it would be included in the value of
the mobile, irrespective of the manner of invoicing.
Illustration-2: X sells a mobile phone to Y. The cost of mobile phone is Rs 40,000/-. Y has the
option to avail a loan at interest of 2.5% per month for purchasing the mobile from M/s. ABC Ltd.
The terms of the loan from M/s. ABC Ltd. allows Y a period of four months to repay the loan and
an additional/ penal interest @ 1.25% per month for any delay in payment.
Here, the additional/ penal interest is charged for a transaction between Y and M/s. ABC Ltd., and
the same is getting covered under exemption Entry 27. Consequently, in this case the 'penal
interest' charged thereon on a transaction between Y and M/s. ABC Ltd. would not be subject to
GST as the same would be covered under said exemption entry. However, any service fee/ charge
or any other charges, if any, are levied by M/s. ABC Ltd. in respect of the transaction related to
extending deposits, loans or advances does not qualify to be interest as defined in exemption
notification, and accordingly will not be exempt.
Moreover, the value of supply of mobile by X to Y would be Rs. 40,000/- for the purpose of levy of
GST.
It is further clarified that the transaction of levy of additional/ penal interest does not fall within
the ambit of entry 5(e) of Schedule II of the CGST Act as this levy of additional/ penal interest
satisfies the definition of “interest” as contained in exemption notification *elaborated above+.
[Circular No. 102/21/2019-GST dated 28.06.2019]
INPUT TAX CREDIT
Restriction on availment of input tax credit (ITC) in respect of invoices/debit notes not uploaded
by the suppliers in their GSTR-1s [New sub-rule (4) inserted in rule 36 of the CGST Rules]
This can be further understood as under
Case Amount of ITC to be claimed by recipient
Where invoice/debit note has been Full ITC, if all other conditions of availing ITC are
uploaded by the supplier in his GTSR-1 fulfilled
Where invoice/debit note has not been 20% of the eligible ITC available in respect of the
uploaded by supplier in his GTSR-1 uploaded invoices/debit notes. However, the ITC
so claimed should not exceed the actual eligible
ITC available in respect of the invoices not
uploaded.
[Notification No. 49/2019 CT dated 09.10.2019]
Illustration 1: Mr. Vijay, a registered supplier, receives 100 invoices (for inward supply of goods/
services) involving GST of Rs. 10 lakh, from various suppliers during the month of October 20XX.
Compute the ITC that can be claimed by Mr. Vijay in his GSTR-3B for the month of October 20XX to
be filed by 20th November 20XX in the following independent cases assuming that GST of Rs. 10
lakh is otherwise eligible for ITC:
Case I: Out of 100 invoices, 80 invoices involving GST of Rs. 6 lakh have been uploaded by the
suppliers in their respective GSTR-1s filed on the prescribed due date therefor.
Case II: Out of 100 invoices, 75 invoices involving GST of Rs. 8.5 lakh have been uploaded by the
suppliers in their respective GSTR-1s filed on the prescribed due date therefor.
Answer: As per sub-rule (4) of rule 36, ITC to be availed by a registered person in respect of
invoices or debit notes, the details of which have not been uploaded by the suppliers in GSTR-1,
cannot exceed 20% of the eligible credit available in respect of invoices or debit notes the details
of which have been uploaded by the suppliers in GSTR-1.
Case I: ITC to be claimed by Mr. Vijay in his GSTR-3B for the month of October 20XX to be filed by
20th November 20XX will be computed as under
Invoices Amount of ITC involved in Amount of ITC that can
the invoices (Rs.) be availed (Rs.)
In respect of 80 invoices uploaded in 6 lakh 6 lakh
GSTR-1 [Refer Note 1 below]
In respect of 20 invoices not uploaded 4 lakh Rs. 1.2 lakh
in GSTR-1 [Refer Note 2 below]
Total 10 lakh 7.2 lakh
Notes:
1) In respect of invoices uploaded by the suppliers in their GSTR-1, full ITC can be availed.
2) The ITC in respect of invoices not uploaded has to be restricted to 20% of eligible ITC in
respect of invoices uploaded in GSTR-1. Thus, in respect of 20 invoices not uploaded in GSTR-
1s, the ITC has been restricted to Rs. 1.2 lakh [20% of Rs. 6 lakh].
Case II: ITC to be claimed by Mr. Vijay in his GSTR-3B for the month of October 20XX to be filed by
20th November 20XX will be computed as under
Invoices Amount of ITC involved in Amount of ITC that can
the invoices (Rs.) be availed (Rs.)
In respect of 75 invoices uploaded in 8.5 lakh 8.5 lakh
GSTR-1 [Refer Note 1 below]
In respect of 25 invoices not uploaded 1.5 lakh Rs. 1.5 lakh
in GSTR-1 [Refer Note 2 below]
Total 10 lakh Rs. 1.5 lakh
[Refer Note 2 below]
Notes:
1) In respect of invoices uploaded by the suppliers in their GSTR-1, full ITC can be availed.
2) The ITC in respect of invoices not uploaded has to be restricted to 20% of eligible ITC in
respect of invoices uploaded in GSTR-1. However, since in this case, the actual ITC [Rs. 1.5
lakh] in respect of 25 invoices not uploaded in GSTR-1 does not exceed 20% of the eligible ITC
in respect of invoices uploaded in GSTR-1s [Rs. 1.7 lakh (20% of Rs. 8.5 lakh)], actual amount
of ITC can be availed.
REGISTRATION
Bank Account details may be furnished after obtaining registration certificate

[New rule 10A inserted and rule 21 of the CGST Rules amended]
A registered person has an option to give his bank account details after obtaining registration,
within 45 days from the date of grant of registration or the due date of furnishing return,
whichever is earlier.
However, if a person violates the provisions of rule 10A, his GST registration is liable to be
cancelled [Rule 21].
This relaxation is not available for those who have been granted registration as TDS deductor/ TCS
collector under rule 124 or who have obtained suo-moto registration under rule 16.
Meaning of not making taxable supply during suspension of registration clarified. Registered
person required to issue revised tax invoice and file first return for supplies during suspension
period [Rule 21A of the CGST Rules]
 Rule 21A provides that once a registered person has applied for cancellation of registration or
the proper officer seeks to cancel his registration, his registration shall remain suspended
during pendency of the proceedings relating to cancellation of registration filed. Such person
shall not make any taxable supply during the period of suspension and shall not be required to
file any return [Rule 21A(3)].
 An explanation has been inserted to this sub-rule (3) to rule 21A clarifying that the expression
“shall not make any taxable supply” shall mean that the registered person shall not issue a tax
invoice and, accordingly, not charge tax on supplies made by him during the period of
suspension.
 Further, a new sub-rule (5) has been inserted in said rule to provide that where any order
having the effect of revocation of suspension of registration has been passed, the provisions
of section 31(3)(a) [revised tax invoices] and section 40 [first return] in respect of the supplies
made during the period of suspension and the procedure specified therein shall apply.
TAX INVOICE
Special provisions pertaining to tax invoice for services by way of admission to exhibition of
cinematograph films in multiplex screens [Rule 46 and 54 of the CGST Rules]
A registered person who is supplying services by way of admission to exhibition of cinematograph
films in multiplex screens shall be required to issue an electronic ticket. The said electronic ticket is
deemed to be a tax invoice, even if such ticket does not contain the details of the recipient of
service but contains the other information as mentioned under rule 46.
Moreover, supplier of such services in a screen other than multiplex screens also has been given
an option to follow above procedure
Consolidated Invoice:
A registered person has an option to issue consolidated tax invoice for supplies at the close of
each day where the value of goods or services supplies is less than Rs. 200; recipient is
unregistered and does not require tax invoice [in terms of section 31(3)(b) of the CGST Act read
with fourth proviso to rule 46 of the CGST Rules]. With effect from 01.09.2019, fourth proviso to
rule 46 has been amended to disallow this option to a supplier engaged in making supply of
services by way of admission to exhibition of cinematograph films in multiplex screens.
E-WAY BILL
Validity of e-way bill in case of multimodal shipment in which at least one leg involves transport
by ship [Rule 138(10) of the CGST Rules]
Rule 138(10) of CGST Rules provides validity period of e-way bill for over dimensional cargo and
for cases other than over dimensional cargo. The sub-rule (10) of rule 138 has been amended to
also provide the validity period of e-way bill for multimodal shipment in which at least one leg
involves transport by ship.
Thus, amended sub- rule (10) lays down as under-
Sl.
Distance within country Validity period from relevant date
No.
1. Upto 100 km One day in cases other than Over Dimensional
Cargo or multimodal shipment in which at least
one leg involves transport by ship
2. For every 100 km or part thereof One additional day in cases other than Over
thereafter Dimensional Cargo or multimodal shipment in
which at least one leg involves transport by ship
3. Upto 20 km One day in case of Over Dimensional Cargo or

multimodal shipment in which at least one leg
involves transport by ship
4. For every 20 km. or part thereof One additional day in case of Over Dimensional
thereafter Cargo or multimodal shipment in which at least
one leg involves transport by ship
The sub-rule (10) has been further amended to lay down that the validity of the e-way bill can be
extended within eight hours from the time of its expiry.
RETURNS
1. Form GSTR-3B to be treated as a return furnished under section 39 of the CGST Act [Rule
61(5) of the CGST Rules]
Section 39(1) of the CGST Act prescribes a monthly return in Form GSTR-3 for every registered
person, other than input service distributor, a non-resident taxable person, a composition
taxpayer, person deducting tax at source, person collecting tax at source i.e., an electronic
commerce operator and supplier of OIDAR services. However, filing of GSTR-3 has been deferred
by the GST Council.
Rule 61(5) of CGST Rules provided that where the time limit for furnishing of details in Form GSTR-
1 under section 37 has been extended and the circumstances so warrant, the Commissioner may ,
by notification, specify the manner and conditions subject to which the return shall be furnished in
Form GSTR-3B. The said rule has been amended retrospectively with effect from 01.07.2017, to
specify that the return in Form GSTR-3B is the return under section 39(1) and that where a return
in GSTR-3B is furnished by a person then such person shall not be required to furnish the return in
Form GSTR-3.
2. Filing of annual return under section 44(1) of the CGST Act for F.Y. 2017-18 and 2018-19
made optional for small taxpayers whose aggregate turnover is less than Rs 2 crores and
who have not filed the said return before the due date
Filing of annual return (GSTR- 9) under section 44(1) of CGST Act read with rule 80(1) of CGST
Rules, in respect of financial years 2017-18 and 2018-19, has been made voluntary for the
registered persons whose turnover is less than Rs. 2 crore and who have not furnished the said
annual return before the due date. The annual return shall be deemed to be furnished on the due
date if it has not been furnished before the due date.

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Taxation Amendments

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INCOME TAX

INTRODUCTION TO INCOME TAX

Senior citizen resident

On the whole of the total income 30%

In the case of a domestic company

Rebate of income-tax in case of certain individuals (Section 87A)

Individual/HUF/AOP Firm/ Co-Operation Society/

TI > 1 Cr but not TI up to

INCOME FROM SALARIES

Self-Occupied Property[Section 23(2)]

Deemed to be let-out property [Section23 (4)]

Pre-construction/ Acquisition interest:

If HP is Y Total Interest allowed

Certain Deductions to be allowed only on Actual Payment [Section 43B]

S.No Particulars Depreciation allowable

Financial Year Cost Inflation Index

Capital Gains on sale of residential house [Section 54]

1. Eligible assesses Individual & HUF

 Purchase two residential houses in India within 1 year before

DEDUCTIONS FROM GROSS TOTAL INCOME

Salaried employee Other individuals

(i) Employees contribution xx (ii) Assessee’s contribution xx

Sec.139 (1):Filling of return of Income (ROI)

ADVANCE TAX & INTEREST

3. Due dates of advance tax for all assessee w.e.f 1/6/16

Interest for non-payment or short-payment of advance tax [Section 234B]

Interest payable for deferment of advance tax [Section 234C]

Specified date Specified % Shortfall in advance tax Period

Particulars Nature of Aggregate of Whether TDS provisions are attracted?

TDS on cash withdrawal [Section 194N]

SUPPLY UNDER GST

Gifts/ donations acknowledged by placing name plates in name of individual donor

To Business Entity To CG/SG/LA/UT/GA To Non-Business Entity

Taxable (Under RCM

To Business To Non Business To CG /SG /LA/ To another individual

Exempt Exempt Exempt

ATO upto such amount in ATO upto such amount in the

Exempt Taxable under RCM

Service provided by Senior Advocate

To Business To Non Business To CG /SG /LA/ To another individual

Exempt Exempt Taxable But Advocate/Firm

ATO upto such amount in ATO upto such amount in the

Exempt Taxable under RCM

Author, music composer

Sl. No. Category of supply of services Supplier of Recipient of

New services under reverse charge mechanism

Sl. No. Category of supply of services Supplier of service Recipient of service

Taxation of Service of RENTING OF MOTOR VEHICLE

Clarification on the effective date of insertion of explanation in notification

Status of Storage & Warehousing Services

Life insurance business services

General insurance business services

Giving Motor Vehicle on hire basis to

STATE TRANSPORT GTA Motor vehicle for transport if

Services by an unincorporated body or a non- profit entity

 Entry no. 77:

Service by an unincorporated body or a non- profit entity To its own

Clarification on issues related to GST on monthly subscription/ contribution charged by a

Note: Tariff price means price without deduction of discount.

GST treatment of such additional / penal interest: CBIC Circular

INPUT TAX CREDIT

Bank Account details may be furnished after obtaining registration certificate

3. Upto 20 km One day in case of Over Dimensional Cargo or