NCLT admits listed coaching firm MT Educare under Corporate Insolvency Resolution Process

21th december,2022

A bankruptcy court has admitted MT Educare, formerly known as Mahesh Tutorials, into the Corporate Insolvency Resolution Proceedings (CIRP) and has appointed Ashwin Bhavanji Shah as interim resolution professional for the Mumbai-based coaching firm.

The Mumbai bank of the National Company Law Tribunal (NCLT) allowed the company’s operating creditor, Connect Residuary, to initiate insolvency proceedings. The operating creditor approached the bankruptcy court in November last year after the company defaulted on its instalments of around Rs 5.37 crore.

“After hearing the submissions of both parties and carefully reading the material available on the record, this court is fully satisfied that the operating creditor has successfully demonstrated the existence of ‘debt’ and ‘default’ committed by the corporate debtor (MT Educare ) in this case,” observed the court of HV Subba Rao and Anuradha Sanjay Bhatia in a December 16 order.

Corporate Laws

48th GST Council Meeting Highlights

17 December,2022 

The 48th GST Council meeting was held on 17th December 2022, Saturday, virtually from New Delhi. Smt Nirmala Sitharaman, the Union Finance Minister, chaired the meeting, along with the Finance Ministers of the states/Union Territories. Eight points out of 15 items on the Council’s agenda, including data-sharing matters, were discussed.

Summary of Key Highlights of the 48th GST Council meeting are as follows :-

• Decriminalisation of three kinds of offences under GST: Obstruction of duties of an officer, the threshold amount of tax for launching criminal offence under GST increased from the current limit of Rs.1 crore to 2 crores, except where fake invoices are involved and to reduce the workload of courts decriminalised the compounding of offence up to a limit;
• A few GST rate rationalisation matters were taken up – GST on pulse husks for cattle feed (including chilka and concentrates) was reduced to nil from 5%. Further, the concessional 5% GST on ethyl alcohol was extended to refineries for blending with petrol, which was earlier charged at 18%.
• Clarifications were given on a few taxation matters, such as the GST on equipment used by petroleum companies for exploration and how to deal with mismatches of invoices in GSTR-1 vs GSTR-3B in the early years.
• e-Commerce operators can allow the suppliers to be registered under the composition scheme and unregistered vendors, facilitating e-commerce for all the micro-enterprises.
• The second report on casinos and online gaming was not circulated and hence not part of the 48th meeting agenda.
• No decision has been taken on any GST rate hike.
• Cess on SUV at 22% clarified- Applicable if meets 4 criteria-
  • Popularly known as SUV, 
  • The engine capacity of more than 1500 cc,
  • Length more than 4000 mm and
  • Ground clearance equal to or more than 170 mm
• Further, Council clarified that no GST on insurance is levied on the No-claim bonus offered by insurance companies, so it is deductible from the premium without a GST charge.

GST

Partial relaxation with respect to electronic submission of Form 10F by select category of taxpayers in accordance with the DGIT (Systems) Notification No. 3 of 2022.

18th December,2022

As per Notification No. 03/2022 dated 16th July 2022 issued by Directorate of Income Tax (Systems) New Delhi in exercise of powers conferred under Rule 131(1)1(2) of the Income-tax Rules mandating, inter alia, furnishing of Form 10F electronically.
On consideration of the practical challenge being faced by non-resident (NR) taxpayers not having PAN in making compliance as per the above notification, and with a view to mitigate genuine hardship to such taxpayers, it has been decided by the Competent Authority that such category of Non­resident taxpayers who are not having PAN and not required to have PAN as per relevant provisions of the Income-tax Act,1961 read with Income-tax Rules, 1962, are exempted from mandatory electronic filing of Form 1OF till 31st March 2023. For the sake of clarity, it is reiterated that such category of taxpayers may make statutory compliance of filing Form 10F till 31st March 2023 in manual form as was being done prior to issuance of the DGIT(Systems) Notification No. 3 of 2022.

Income Tax

EU adopts global minimum 15% tax on multinationals

16th December,2022

The European Union on 16^th December,2022 adopted a plan for a global minimum 15% tax on multinational businesses, after leaders gave final approval following months of wrangling.The landmark agreement between nearly 140 countries is intended to stop governments racing to cut taxes to lure the world's richest firms to their territory."Today the European Union has taken a crucial step towards tax fairness and social justice," EU economy commissioner Paolo Gentiloni said."Minimum taxation is key to addressing the challenges a globalized economy creates."The plan was drawn up under the guidance of the Organization for Economic Cooperation and Development and already had the backing of Washington and several major EU economies.

International Tax

FASB releases GAAP Taxonomy reports

17th December,2022

FASB on 17 Dec. 2022 released its Annual GAAP Taxonomy, which includes the 2023 GAAP Financial Reporting Taxonomy (GRT) and the 2023 SEC Reporting Taxonomy (SRT). The 2023 GRT contains updates for accounting standards and other improvements since the issuance of the 2022 Taxonomy as used by issuers filing with the SEC. According to a FASB news release, the 2023 SRT includes changes to SEC Staff Accounting Bulletin No. 121 on obligations to safeguard crypto assets that an entity holds for platform users.

US Accounting

FASB amended transition guidance in Accounting Standards

15th December,2022

The amendments to the ASU require that an insurance entity apply a retrospective transition method as of the beginning of the earliest period presented or the beginning of the prior fiscal year if early application is elected. In FASB's summary of the amended standard, the board said it received feedback from stakeholders "indicating that applying the LDTI guidance to contracts that were derecognized because of a sale or disposal of individual or a group of contracts or legal entities before the LDTI effective date likely would not provide decision-useful information to investors and other allocators of capital and may result in significant operability challenges for insurance entities to apply the guidance." The update was issued to reduce implementation costs and complexity related to the adoption of LDTI for contracts derecognized before the LDTI effective date.

US Accounting

Cross-border tax cases outside faceless assessment scheme: CBDT

10th December,2022

The Central Board of Direct Taxes (CBDT) has said that information related to compulsory scrutiny of cases in “International Tax and Central Charges” will not be transmitted to the National Faceless Assessment Centre (NaFAC) unless the case itself is transferred. In a recent clarification on its guidelines for selection of returns for scrutiny, the CBDT has further said that communication to NaFAC for access and further action after selection for compulsory scrutiny will also not apply to these areas.

Income Tax

Can you change income tax regimes while filing revised ITR?

• Dec 06, 2022 
  
  

• It is possible that after filing income tax return (ITR), you might realise that you have forgotten to report certain incomes or that the tax payable in the other tax regime is lower than what has been paid. The question then is can you switch your income tax regime (old to new or vice versa) while filing a revised income tax return? ET Wealth spoke to various tax experts and chartered accountants to shed more light on this issue. Read it, but also remember that the last date of filing revised ITRs is December 31, 2022, for FY 2021-22 (AY 2022-23). Do note that if you are filing or have filed belated income tax return, then you are not eligible to opt for new income tax regime as per income tax laws. Hence, if you revise your belated ITR, then also you cannot opt for new tax regime.

Income Tax