INCOME TAX ACCOUNTING STANDARDS FOR COMPUTATION OF INCOME CHARGEABLE TO INCOME TAX
CBDT notified the ten “income computation and disclosure standards” to be followed by all assessees, following the mercantile system of accounting, for the purposes of computation of income chargeable to income-tax under the head “Profit and gains of business or profession” or “ Income from other sources”.
The Notified Standards are relating to :- Continue reading
INCOME TAX BENEFITS TO TELANGANA & BACKWARD AREAS OF ANDHRA PRADESH
With both Houses of Parliament having passed the Andhra Pradesh Reorganisation Bill,2014, Telangana eventually become the newest 29th State of the Indian Union. After sixty years of tenacious struggle the people of the Telangana region have, defying all odds and sacrificing countless precious lives, been able to secure for themselves a separate State. This is indeed of historic importance and the people of Telangana are justifiably feeling jubilant. Continue reading
Budget 2015 – Highlight on on direct taxation
1.Surcharge increase by 2% in all cases except in case of foreign company which is continue to be at the rate of 2% if taxable income exceeds Rs. 1 crore & 5% if taxable income exceeds Rs. 10 crore.
Now effective rate of surcharge w.e.f AY 2016-17 will be 7% if taxable income exceeds Rs. 1 crore & 12% if taxable income exceeds Rs. 10 crore.
2. Dealing in cash in immovable property transactions is covered under section 269SS & T.
Consequential amendments in section 271D and section 271E to provide penalty for failure to comply with the amended provisions of section 269SS and 269T, respectively. Continue reading
For the purpose of calculating the deduction, according to the export related deduction provisions such as Section 10AA,80HHC, etc of the Income Tax Act, one has to take into account the profits from the business of the assessee, export turnover and total turnover.
The deduction is determined as under:
Profits of the Business X Export Turnover/Total Turnover
Thus, to determine the amount of deduction, the assessee and the Revenue must be aware of the following three ingredients:
i) Profits of the business
ii) Export turnover
iii) Total turnover
The term ‘turnover’ has neither been defined in the Act nor has been explained by any of the CBDT circulars. In the aforestated circumstances, one has to look at the meaning of the term ‘turnover’ in ordinary accounting or commercial parlance.
Now the dispute is that, whether sale proceed of scrap is constitute as a part of total turnover or not ?
One can very well see that if the total turnover increases, the advantage of deduction would decrease because the amount deductible substantially depends upon the ratio between the export turnover and total turnover.
IN THE SUPREME COURT OF INDIA, Commissioner of Income Tax-VII, New Delhi Versus Punjab Stainless Steel Industries Continue reading