Income Tax Regulatory Updates

Direct Tax Provisions, Statutory Circulars, Notifications & Filing Guidelines

Direct Tax Advisory

Direct Taxation Provisions & Compliance Circulars

Statutory analysis and practical guidance prepared by the Direct Tax division of G. R. Modi & Co. for corporate and individual assessees.

Summary: Detailed guidelines, FAQ interpretations, and compliance rules regarding cash receipt thresholds under the Income Tax Act.

Cash Transaction Frequently Asked Questions:

Detailed guidance on high-value cash transactions, applicability of provisions restricting cash transactions, and penalties under Sections 269SS, 269T, and 269ST of the Income-tax Act.

  • Prohibition on accepting loans or deposits in cash exceeding Rs. 20,000.
  • Prohibition on repayment of loans or deposits in cash exceeding Rs. 20,000.
  • Restriction on accepting cash of Rs. 2,00,000 or more in aggregate from a person in a day, in respect of a single transaction, or in respect of transactions relating to one event or occasion.

Summary: Employees whose salaries are liable to TDS u/s 192 must submit particulars of tax claims and investment evidence in statutory Form 12BB.

Employees whose salaries are liable to TDS u/s 192 are required to give declarations in Form 12BB to their employer. Previously, employees claimed tax deductions through simple self-declarations of tax savings/deductions along with evidences.

Under the notified rules, the employer is liable to deduct tax at source on estimated employee income after verifying Form 12BB and supporting documentary evidences for House Rent Allowance (HRA), Leave Travel Concession (LTC), deduction of interest on home loans, and Chapter VI-A deductions (80C, 80D, 80G, etc.).

Summary: Statutory schedule and deadlines for filing quarterly TDS and TCS returns across Q1, Q2, Q3, and Q4.

Due dates for filing of quarterly TDS returns by corporate and non-government deductors are:

QuarterQuarter PeriodDue Date for TDS (Form 24Q, 26Q, 27Q)Due Date for TCS (Form 27EQ)
Q11st April to 30th June31st July15th July
Q21st July to 30th September31st October15th October
Q31st October to 31st December31st January15th January
Q41st January to 31st March31st May15th May

Summary: Rules governing compulsory collection of PAN or Form 60 for any purchase or sale transaction exceeding Rs. 2,00,000, and reporting in Form 61/61A.

Quoting of PAN is mandatory for transactions of sale and purchase of goods and services where payment exceeds Rs. 2 Lakhs per transaction regardless of the mode of payment.

Three Basic Duties Cast Upon the Taxpayer:
  1. Obtaining PAN or declaration in Form 60 along with proof of identity and address from customers and suppliers for transactions exceeding Rs. 2 Lakhs per transaction.
  2. Filing of bi-annual returns in Form 61 for taxpayers subject to tax audit.
  3. Filing of Annual Information Return in Form 61A for cash receipts in aggregate exceeding Rs. 2 Lakhs.

Summary: Key amendments in requirements of Form 15CA & 15CB and foreign remittances under Section 195.

Highlights of Changes:

  • No Form 15CA and 15CB required to be furnished by individuals for remittances which do not require RBI approval under the Liberalised Remittance Scheme (LRS).
  • Expanded list of payments which do not require submission of Forms 15CA & 15CB (including import payments).
  • CA Certificate in Form No. 15CB is required only for payments made to non-residents which are chargeable to tax and where the payment during the year exceeds Rs. 5 Lakhs.

Summary: Comprehensive comparative matrix explaining mandatory digital signature (DSC), EVC, and electronic verification rules across assess classes.
Assessee CategoryAudit StatusMandatory Filing Mode
CompaniesAll CasesDigitally under Digital Signature (DSC)
Firms / LLPsAudited u/s 44ABDigitally under DSC
Firms / LLPsNon-AuditedElectronically with EVC or ITR-V verification
Individuals / HUFAudited u/s 44ABDigitally under DSC
Individuals / HUFNon-AuditedElectronically with Aadhaar OTP / EVC / Netbanking
Political PartiesAll CasesDigitally under DSC

Summary: Detailed checklist of critical clauses in Form 3CD including Section 43CA, 50C, 40(a), 40A(3), and detailed TDS/TCS reconciliations.

CBDT prescribes stringent reporting disclosures in Form 3CD for statutory tax audits:

  • Clause 17: Transfers of land or building for consideration less than stamp duty value (Jantri value) under Section 43CA or 50C.
  • Clause 21(b): Amounts inadmissible u/s 40(a) and delayed deposit of TDS u/s 200(1) & 139(1).
  • Clause 21(d): Payments made in violation of Section 40A(3) exceeding Rs. 10,000/35,000 otherwise than by account payee cheque/draft/ECS.
  • Clause 34: Detailed TAN-wise, section-wise TDS/TCS deduction, deposit, and interest reconciliation under Section 201(1A)/206C(7).
  • Clause 40: Comparative financial ratios (Gross Profit, Net Profit, Stock Turnover, Material Consumed).

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