International Tax
Transfer Pricing – Applicability of Safe Harbor Rules extended tillAssessment Year (AY) 2022-23. Rule 10TD of the Income-tax Rules, 1962 prescribes a list of eligible international transactions wheretransfer price declared by the taxpayer shall be required to be accepted by the tax authorities (safe harbor).The Rule was valid until AY 2021-22. CBDT has now extended the validity of the Rule till AY 2022-23.Please Click Here to read the Notification no. 66 / 2022 dated 17 June 2022.Mutual Agreement Procedure (MAP) - CBDT releases updatedguidanceWhat is MAP?India has signed Double Taxation Avoidance Agreements (‘DTAAs’) with many countries. MAP is analternate tax dispute resolution mechanism available to the taxpayers under the DTAAs for resolving crossborder disputes. MAP can help in relieving double taxation either fully or partially. Almost all DTAAs enteredinto by India have the MAP Article. It provides an additional dispute resolution mechanism to taxpayers inaddition to those available under the domestic laws of India. A taxpayer can request for assistance underMAP regardless of the remedies provided under the Indian domestic law.MAP enables the Competent Authority (‘CA’) of India (appointed by the Government of India) to engagewith the CAs of other DTAA countries to facilitates discussions and negotiations between both countries asthey endeavour to resolve international tax disputes. A request under MAP can be made by a taxpayerwhen it considers that the actions of the tax authorities of either or both of the DTAA countries could resultin taxation not in accordance with the DTAA, especially on the following matters:
• Transfer Pricing adjustments
• Existence of a Permanent Establishment (taxable presence)
• Attribution of profits to a Permanent Establishment
• Characterisation or re-characterisation of an income or expense
Read notification from Incometax India
GST
GST revenue collection for May 2022 Rs.140,885 Crore (44%higher than GST revenue collection in May 2021).The gross GST revenue collected in the month of May 2022 is Rs. 140,885 Crore as below. IGST (Integrated Goods and Services Tax) Rs. 73,346 CroreCGST (Central Goods and Services Tax) Rs. 25,036 CroreSGST (State Goods and Services Tax) Rs. 32,001 CroreCompensation cess Rs. 10,502 CroreTotal Rs. 1,40,885 Crore This is the 4th time the monthly GST collection crossed Rs.1.40 lakh crore mark since inception ofGST. The revenues for the month of May 2022 are 44% higher than the GST revenues in May2021. During the month, revenues from import of goods were 43% higher and the revenues fromdomestic transaction (including import of services) are 44% higher than the revenues from thesesources during the same month last year.
Direct Tax
Tax with holding (TDS) on transfer of Virtual Digital Assets (VDA) /Cryptocurrency - Central Board of Direct Taxes (CBDT) prescribes with holding tax return (Form 26QE) & TDS certificate (Form 16E)effective from 1 July 2022 onwardsBackgroundFinance Act, 2022 has introduced taxation on transfer of VDA. Correspondingly, a new provision(section 194S) has been inserted in the Income-tax Act, 1961, to introduce withholding tax @ 1%with effect from 1 July 2022 onwards on payment for transfer of VDA to a resident in India, subjectto certain threshold limit of course.
Company Law
Ministry of Corporate Affairs (MCA) allows restoration of name of candidates willing to be appointed as Independent Directors, in casetheir name is removed from the database maintained by IndianInstitute of Corporate Affairs (IICA)Pursuant to the Companies (Appointment & Qualification of Directors) rules, everyindividual willing to be appointed as an Independent Director in any company shall:
• Have his name included in the databank of Independent Directors maintained byIICA; and
• Qualify an online proficiency self-assessment test conducted by IICA within 2years from the date of inclusion of his name in the databank, failing which hisname shall stand removed from the databankTo provide some relaxation, Ministry of Corporate Affairs (MCA) vide notificationdated 10th June 2022 has amended the aforesaid rules. Going forward, everyindividual whose name is removed from the database maintained by IICA, may applyfor restoration of his name on payment of statutory fee of Rs. 1,000, subject tofulfilment of following conditions:
• His name shall be shown in a separate restored category for 1 year from the dateof name restoration within which, he shall be required to pass the onlineproficiency self-assessment test conducted by IICA and thereafter on qualifying thesaid test, his name shall be included in the databank, and
• In case he fails to qualify the online proficiency self-assessment test within 1 yearfrom the date of name restoration, his name shall be removed from the databankand he shall be required to apply afresh for inclusion of his name in the databank
