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Finance Ministry’s Compliance Extensions & Relaxations-Mar’20

March 25, 2020 | Latest Tax Update, Latest Update, MBG, News

In a press conference on 24th March 2020, India’s Finance Minister has announced certain date extensions & relaxations for addressing various tax & statutory compliance & operational issues amid a total lockdown in India to control the spread of Covid-19 infection.

Income Tax & other Direct tax Compliances

  • The last date for filing belated returns for AY 2019-20 (FY 2018-19) extended from 31st March 2020 to 30th June 2020. Annual penal interest rate reduced to 9% from the existing 12%
  • Aadhaar-PAN linking also extended to 30th June 2020 from 31st March 2020.
  • For TDS, Advance tax and other taxes & levies no date extension. But reduced interest rate of 9% to be charged on delayed deposits of advanced tax, self-assessment tax, regular tax, TDS, TCS, equalization levy, STT, CTT made between 20th March 2020 and 30th June 2020. No late fee/penalty shall be charged for delay relating to this period.
  • Vivad Se Vishwas Dispute Resolution scheme – Last date for payment of tax extended to 30th June 2020. No additional 10% payment required after 31st March 20.
  • Due dates for issue of notices, intimation, notifications, approval/ sanction orders, appeal filing, furnishing of return, statements, applications, reports, any other documents and time limit for completion of proceedings by the authority & any compliance by the taxpayer including investment in saving instruments or investments for rollover benefit of capital gains under Income Tax Act, Wealth Tax Act, Prohibition of Benami Property Transaction Act, Black Money Act, STT law, CTT Law, Equalization Levy, Vivad Se Vishwas law where the time limit is expiring between 20th March 2020 to 29th June 2020 to be extended to 30th June 2020.
  • Necessary legal circulars and legislative amendments for giving effect to the aforesaid relief shall be issued in due course.

GST & Custom Compliances

  • Deadline for GSTR-3B filings due in March, April & May 2020 returns to be extended till last week of June 2020 in a staggered manner. For those having an annual turnover less than Rs. 5 Crores, no interest, late fee, and penalty to be charged. For bigger companies, only interest but no late fee and no penalty for GST.
  • Thus, extension has been given for the returns for supplies made in the month of February, March & April 2020.
  • For delayed payment between 20th March 2020 & 30th June 2020 reduced rate of interest @ 9% per annum (current rate – 18 % p.a.) will be charged. No late fee and penalty to be charged, if complied before till 30th June 2020.
  • The date for opting for composition scheme is extended till the last week of June 2020. Further, the last date for making payments for the quarter ending 31st March 2020 and filing of return for 2019-20 by the composition dealers will be extended till the last week of June 2020
  • The date for filing GST annual returns of FY 18-19, due on 31st March 2020 extended till the last week of June 2020.
  • The payment date under Sabka Vishwas Scheme shall be extended to 30th June 2020. No interest for this period shall be charged if paid by 30th June 2020.
  • Necessary legal circulars and legislative amendments to give effect to the aforesaid GST relief shall follow with the approval of the GST Council.
  • 24*7 Custom clearance till the end of 30th June 2020
  • The due date for issue of notice, notification, approval/ sanction order, return filing, filing of appeal, furnishing applications, reports, any other documents, etc., the time limit for any compliance under the GST Law, Customs Act & other allied Laws where the time limit is expiring between 20th March 2020 to 29th June 2020 shall be extended to 30th June 2020.

Corporate Affairs

  • No additional fees shall be charged for late filing during a moratorium period from 1st Apr to 30th September 2020, in respect of any document, return, statement, etc., required to be filed in the MCA-21.
  • The mandatory requirement of holding meetings of the Board of the companies within the prescribed interval provided in the Companies Act (120 days), 2013, shall be extended by a period of 60 days till the next two quarters i.e., till 30th September.
  • Applicability of Companies (Auditor’s Report) Order, 2020 shall be made applicable from the financial year 2020-2021 instead of from 2019-2020 notified earlier.
  • For the year 2019-20, if the Independent Director(s) of a company have not been able to hold even one meeting, the same shall not be viewed as a violation.
  • The requirement to create a Deposit reserve of 20% of deposits maturing during the financial year 2020-21 before 30th April 2020 shall be allowed to be complied with till 30th June 2020.
  • The requirement to invest 15% of debentures maturing during a particular year in specified instruments before 30th April 2020 may be done so before 30th June 2020.
  • Newly incorporated companies are required to file a declaration for Commencement of Business within 6 months of incorporation. An additional time of 6 more months shall be allowed.
  • Non-compliance of minimum residency in India for a period of at least 182 days by at least one director of every company, under Section 149 of the Companies Act, shall not be treated as a violation.

Insolvency and Bankruptcy Code (IBC)

  • If the situation on COVID- 19 pandemic does not get better before 30th Apr 2020, the government will consider suspending Section 7, 9 and 10 of the IBC for a period of 6 months in order to stop companies being forced to insolvency.
  • Insolvency & Bankruptcy Code default limit has been increased from Rs 1 lakh to Rs 1 crore to prevent triggering of IBC proceedings against Micro, Small & Medium Enterprises (MSMEs).

 Financial Services

  • Relaxations for 3 months
  • Debit cardholders to withdraw cash for free from any other banks’ ATM for 3 months
  • Waiver of minimum balance fee
  • Reduced bank charges for digital trade transactions for all trade finance consumers

Department of Commerce

Extension of timelines for various compliance and procedures will be given. Detailed notifications will be issued by the Ministry of Commerce. Link of the Official Press release of the Govt. – https://pib.gov.in/PressReleaseIframePage.aspx?PRID=1607942 Disclaimer – This note is a brief on the Government’s Press Conference on the Subject Topic. The reader should conduct and rely upon their own examination & analysis and are advised to seek their own professional advice. This document is not an offer, invitation, advice or solicitation of any kind. We accept no responsibility for any errors it may contain or for any loss, howsoever caused or sustained, by the person who relies on it.   Last Updated: 25th March 2020 This article is contributed by:  Kartik Chhabra Transfer Pricing & International Tax  

Tag: Finance Ministry India, GST, Tax Update