What is the date of Effective Voluntary Cancellation of Registration under the IT ACT?

Say 12AA Registration, Registration u/s Sec 10 (23C) , PAN NO, TAN NO. etc

1.Voluntary Cancellation of any Registration ( Maybe granted Sec 12AA, u/s 10(23C, etc), Assessee may apply for cancellation of the Registration to the Authority at any point of time.

2.Once the cancellation application was received by the Authority, it is the duty of the Authority Either to accept it OR issue a Show Cause Notice to the Assessee within a reasonable time.

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3.Where no show cause notice was received within a reasonable time then Date of Cancellation of Registration has to be accepted as on the date when Assessee made the application before the Authority.

4.Where Show Cause Notice was received from the Authority, towards Cancellation Application, then the Effective date of Cancellation shall be held as the Date on Conclusion of hearing before the Authority OR reply to the Show Cause notice was placed before the Authority.

The above view was based upon the Principle that
” All the Powers held by someone in a Public Office are powers held in TRUST for the benefit of the Public at Large.
Officers have no discretion either to use or not to use the powers given by the ACT to the Officers.

registration

5.Ex: For deciding the Effective Date of Voluntary Cancellation of Registration:
(i). Date of Application: 5th Feb 2019.
( ii). Show cause notice issued by Deptt: 10.03.2019.
(iii). Date of the hearing of Show Cause Notice. 20.03.2019.
(iv). Date of communication towards Cancellation from.Deptt: 05.06.2021.

Here the date of Voluntary Cancellation of Registration Shall be the date when on Conclusion of hearing of the Show Cause Notice that is 20.03.2019.

Date of Communication from Deptt. Towards Cancellation that is 05.06.2021 has no Relevance.

According Assessee is not under any obligation to fulfil the provisions relating to the Registration From.FY 2019-20.

The above view is supported by the Judgment of the ” NAVAJBAI RATAN TATA TRUST vs. PCIT (MUM.ITAT).

Nut Shell:

1.Voluntary cancellation of Registration ( Say 12AA, (10(23C)), shall be effective from the date on conclusion of the Hearing or filling reply to the Show Cause Notice towards Cancellation.

2.No Show cause notice it is the date of Application for Cancellation.

3.Date of Deptt’s letter granting Cancellation has no relevance to decide, Date of Cancellation.

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Major Changes in CARO 2020 Comapred to CARO 2016

As you would Know, MCA has notified Companies (Auditor’s Report) Order 2020 or CARO 2020, with effect from February 25th, 2020. Notice that it was 16 Clauses earlier and there are 21 Clauses now. It added 5 Additional Clauses.

Below are 10 major changes in CARO 2020

1) Fixed Asset Rejig

a. Before words Fixed Assets, Now it is replaced with land, plant, equipment and intangible assets (PPEIA).

b.When Title Deed is not in the company’s name (except in the case of Lease) then all these instances disclose with justification in the tabular format.

c.Any Revaluation to be recorded in PPEIA.

d.Any Benami proceedings started to be reported.

2) Inventory Physical Verification & Bank Limit Rejig

a. Coverage of inventory verification and the procedure to be disclosed.

b. Any dis.crepancy to be closed above 10 percent

c. Any Working Capital Limit beyond 5 Cr on Current Assets Collateral to be reported and returns filed with Bank in compliance with Records

3) Loans & Advances Rejig

a. Earlier payments settled by extension, renewal or new loans to be reported.

b. Any loans on a request basis to be reported separately.

4) Default in Loan Repayment Rejigs 

a. Specified Default Reporting table

b. Disclosure of Financial Institutions found willful defaulter.

c. Terms of loan used for the right purpose or not

d. Whether Short term loans are applied for long term purposes.

e. Funds received under the service obligation of Subsy, JV or Associate Companies

f. Funds received for the commitment of shares of Subsy, JV or Associate Companies

5) Fraud Reporting Rejig

a. ADT-4 Filed by the Auditor, if any, to be reported.

b. Any complaint made to the whistleblower during the audit

6) Managerial Remuneration Clause Deletion

a. Payment of management remuneration in accordance with Sch V has been withdrawn

7) Five New Clauses

a. 17 – Cash Losses – Cash losses need to be reported to the FY if any

b. 18 – Resignation of Auditor – Issues raised by him whether they were considered or not if any.

c. 19 –The willingness of the Company to meet its current liabilities in the auditor’s view on the basis of ratios results and aging.

d. 20 – CSR Compliance – Ongoing project whether the unused amount was transferred to the fund within 6 months / Special account

e. 21 – Companies in Consolidation –All negative comments of CARO, whether of any grant, JV or Associate company as consolidated, must be reported in Holding Company Clause 21 of CARO.

8) NBFC Companies Compliance Reporting Rejig

a.  Whether NBFC is having a valid Certificate from RBI

b. Whether it’s CIC, whether there is more than 1 CIC and compliance in the community.

9) Internal Audit Rejig

a. Whether the Internal Audit System exists as per the Company Size or not?

b.Whether any internal audit report was considered by the auditors

10) Income Tax Transactions not in Books

a. Whether any transactions offered for income tax purposes, but not recorded in Books.

Conclusion:-

Welcome Changes, these will improve the reporting especially after ILFS, DHFL Fiasco

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GST-9 & GSTR-9C Annual Compliance – Shift of Goal Post!

CBIC has extended due date for furnishing the annual return in form GSTR 9, GSTR 9A and Audit report in GSTR 9C for FY 2017-18 till 30.11.2019.

Following are the Important dates for compliances which are as under:-

  1. Annual Return for FY 2017-18 and GST Audit report last date is now 30.11.2019.

 

  1. Annual Return for FY 2018-19 and GST Audit Report last date is 31.12.2019

 

  1. For Taking ITC for FY 2018-19 the last date is 20.10.2019, the due date of filing 3B for September 2019 Month.
  1. CHARTERED ACCOUNTANTThe due date for filing a non-audit Income Tax return is 31.08.2019

 

  1. The due date for  audit assessee and tax audit assessee is 31.09.2019

 

  1. Implementation of new GSTR form RET 01, ANX 1 and ANX 2 staring from 1.10.2019

 

  1. The advance tax payment date is 15.09.2019.

 

  1. Preparation of Balance of all companies is by 1st week of September 2019

Since UDIN is to be generated while signing Balance sheet by Auditor.

 

*Note:- Government may change the utility of any form any time

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