Section 206C(1H) of the Income Tax Act 1961 at a Glance

Section 206C(1H) of the Income Tax Act 1961 at a Glance

1.The provisions of this sections are applicable with effect from 1st October, 2020.

The section provides that in case of sale of goods of the value or aggregate of such value more than Rs 50 lakhs in any PY, (other than the goods being exported out of India or goods covered in 206C (1) or 206C(1F) or 206C(1G)] seller shall collect TCS from the buyer @0.1% of the sale consideration in excess of Rs 50 lakhs.

SPECIAL POINTS TO BE REMEMBERED

If the buyer (collectee) does not furnish PAN or Aadhar the TCS rate shall be 1%.

Since TCS is to be collected on the receipt amount, the section applies on all sale consideration including any advance amount received on or after 1st Oct 2020 irrespective of the fact that the sale was carried out before 1st Oct or not.

The calculation of the amount of sales consideration for ascertaining the eligibility for collection of tax at source as regards to Rs 50 lakhs shall be computed from 1st April 2020.

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NON-APPLICABILITY

Sale of services as this section applies to sale of goods only.

Any consideration for fuel supplied to non-resident airlines at airports in India.

EXPLANATION TO THE WORDS

SELLER: A person whose Turnover or Gross Receipts from the business carried on by him more than Rs 10 Crore in last Previous year.

BUYER: A person who purchases any goods, but does not include

(a) Central Govt, State Govt, embassy, High Commission, Legation, commission, consulate, trade representation of a foreign State, Local Authority

(b) A person importing goods into India or any other notified person.

EXAMPLES

Mr. Shyam has Turnover Rs 20Cr in last PY. He Sold goods to Mr. Ram up to 30/09/20 worth Rs 40 Lakhs and Rs 20 Lakhs from 1/10/21 to 31/03/21.

TCS applicable on Rs 10 Lakhs @ 0.1% i.e., Rs 1000/-

Mr. Shyam has Turnover Rs 30Cr in last PY. He Sold goods to Ram Ltd. up to 30/09/20 worth Rs 46 Lakhs and Rs 25 Lakhs from 1/10/21 to 31/03/21.

TCS applicable on Rs 21 Lakhs @ 0.1% i.e., Rs 2100/-

Mr. Ghanshyam has Turnover Rs 30Cr in last PY. He Sold goods to Punjab Govt up to 30/09/20 worth Rs 46 Lakhs and Rs 25 Lakhs from 1/10/21 to 31/03/21.

TCS not applicable as section does not apply to a buyer being state govt.

Haryana Govt has Turnover Rs 30Cr in last PY. He Sold goods to Ram Ltd. upto 30/09/20 worth Rs18 Lakhs and Rs 85 Lakhs from 1/10/21 to 31/03/21.

TCS applicable on Rs 53 Lakhs @ 0.1% i.e., Rs 5300/-

Mr. Ramesh has Turnover Rs 10Cr in last PY. He Sold goods to Ram Ltd. up to 30/09/20 worth Rs 46 Lakhs and Rs 25 Lakhs from 1/10/21 to 31/03/21.

TCS NOT applicable as Turnover In last PY is not more than Rs 10 Crore.

THE GOVERNMENT HAS NOTIFIED SOME IMPORTANT POINTS ON NEW ITR FORMS.

There are a few key points to remember about the new ITR forms that the government has announced.

The Income Tax Return Forms (ITR Forms) for the Assessment Year 2021-22 have been released by the Central Board of Direct Taxes (CBDT).

Changes to the Current ITR Forms

In contrast to last year’s ITR Forms, no major improvements have been made to the ITR Forms. Only the bare minimum changes were introduced as a result of revisions to the Income-tax Act of 1961.

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This has been achieved in light of the current COVID pandemic crisis.

THE CBDT AMENDS RULE 6G AND REVISES TAX AUDIT FORM 3CD

Details about ITR Forms:
Easy ITR Forms to Make Doing Business Easier
  • Simpler ITR Forms 1 (Sahaj) and 4 (Sugam) are available for a significant number of small and medium taxpayers.
  • A person with income up to Rs. 50 lakh who receives income from salary, one house property, or other sources may file a Sahaj [ITR-1] (interest etc.).
  • Individuals, Hindu Undivided Families (HUFs), and companies (other than Limited Liability Partnerships (LLPs)) with total income up to Rs. 50 lakh and income from company and profession computed under the presumptive taxation provisions are entitled to file Sugam [ITR-4].
Other Forms
  • Individuals and HUFs without business or occupation income (and therefore not entitled to file Sahaj) can file ITR Form 2.
  • Individuals and HUFs with business or technical income will file ITR Form 3.
  • ITR Form 5 may be filed by individuals, HUFs, and companies such as partnership firms, LLPs, and so on.
  • ITR Form 6 may be filed by companies
  • ITR Form 7 may be filed by trusts, political parties, charitable organisations, and those who are seeking exempt profits under the Act.

ITR Doesn’t Indicate Savings Bank Interest? Income Tax will send you an SMS to remind you to revise your returns and check your compliance status.

Income Tax Dept- Focus on Savings Bank Interest  & Fixed Deposit Intt. 

Since yesterday, March 28, 2021, many taxpayers have received the following SMS from the Internal Revenue Service:

IT Dept. asks tax payers to revise the returns for omission of Savings Bank & FD Interest as messages are sent over the weekend to comply and complete the response on IT portal.

Pay close attention. NISHIL CHAUHAN XXXX (XXXXX19XX12X), The Internal Revenue Service has found high-value data that does not seem to be compatible with the Income Tax Return for Assessment Year 2020-21. (relating to FY 2019-20). Please revise your ITR and request an online response through the Compliance Portal’s e-Campaign page (CP). Login in to the e-filing portal and select the ‘Compliance Portal’ connection from the ‘My Account’ or ‘Compliance’ tab – ITD is an acronym for “Intelligent

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Since the banks are closed until Tuesday, many taxpayers will be unable to confirm their interest income. The deadline for revising returns is March 31, 2021, which is just two days after receiving notice. We should assume or hope that the Internal Revenue Service can allow us more time to file Revise returns.

SEBI – Approved amendments in SEBI LODR Regulations Board Meeting

In addition, the 26AS Statement does not include interest income, which is included in the Compliance Portal. Every taxpayer must reconcile all interest income from Fixed Deposits and Savings Accounts from all banks. This will take more time, and filing updated returns in two days is virtually impossible.

To access the Compliance Portal, go to the IRS e-filing website and select Compliance and Confirm from the drop-down menu.
  • This section is for submitting your response to the High-Value Transactions listed for Assessment Year 2020-21 based on an overview of your income tax return and details obtained from various sources (relating to FY 2019-20).
  • Depending on the nature of the details, submitting a response could take up to 10 minutes.
  • The information displayed could change in the future, depending on the department’s revision of the data obtained from the Reporting Entities.
  • In the future, you will have the choice to amend your answer.
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