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HVJ
COMMUNIQUE
Sep 2023
119th Edition

info1@hvj.co.in
Dear Professional Colleagues,

“The greater the obstacle, the more glory in overcoming it.”

“The toughest challenges bring the greatest rewards.” If there is no struggle, there will be no
progress. Every obstacle we come across in our life gives us an opportunity to improve
circumstances and teaches something out of it. We just have to believe in ourselves and
should build never give up attitude.

We, at HVJ, see all the challenges as an opportunity to improve ourself and convert them as
our strength. We improve ourself at every stage with latest updates and work passionately
to provide best quality services to our esteemed client’s needs and their business growth, we
make consistent effort to give best to our clients as we believe success of our client’s is the
success of HVJ.

We are delighted to bring you our 119th edition of HVJ Communique which briefs about
various amendments/circulars/clarifications in Goods and Service Tax, Income Tax,
RBI and Companies Act 2013. We are always on our forefront to apprise our clients,
Associates as well as those seeking knowledge with recent updates on various laws and
regulations. We have consolidated various regulatory announcements and amendments
by respective regulators, along with our analysis, for the month of September2023

Help us improve!
We hope you find this Journal informative and of continued interest. We welcome
Your feedback at Info1@hvj.co.in

With warm regards

CA Sudheer Javali
Partner
B. Com, FCA, DISA

Page 1 of 14
THE COMPENDIUM

i. Goods and Services Tax Act, 2017

ii. Income Tax Act, 1961

iii. RBI / FEMA

iv. Companies Act, 2013

Page 2 of 14
Sr. No Particulars Due Date
GST Compliance Calendar
GSTR 7 is a return to be filed by the persons who is required to 10-09-2023
1 deduct TDS
GSTR-8 is a return to be filed by the e-commerce operators who are 10-09-2023
2
required to deduct TCS
GSTR-1 - Taxpayers having an aggregate turnover of more than Rs. 11-09-2023
3 1.50 Crores or opted to file Monthly Return
4 GSTR-1 GST return for the taxpayers who opted for QRMP scheme 13-09-2023
5 GSTR-6 Input Service Distributors 13-09-2023
6 GSTR-3B (Monthly) for August 2023 20-09-2023
7 GSTR -5 for August 2023 (Non-Resident Taxable person) 20-09-2023
8 GSTR – 5A for August 2023 (OIDAR Service provider) 20-09-2023
Compliance Calendar for PT, PF, ESI, TDS Payments
1 PF Payment for the month of August 2023 15-09-2023
2 ESI Payment for the month of August 2023 15-09-2023
3 Professional Tax Due date for the month of August 2023 20-09-2023
Compliance Calendar for Companies Act
1 Transfer of unspent CSR amount to the CSR fund 30-09-2023
2 Secretarial Audit 30-09-2023
3 Appointment of CS Audit- MGT-8 30-09-2023
4 Generation of UDIN by statutory Auditor of a company 30-09-2023
5 Quarter 2- Board Meeting 30-09-2023
6 Annual General Meeting 30-09-2023
Filing of Audited Financial Statements (only for One Person 30-09-2023
7
Company)
8 DIR 3 KYC for Directors for FY 2022-23 30-09-2023
Compliance Calendar for Income Tax Act
1 Payment of TDS/TCS deducted /collected in August 2023. 07-09-2023
2 Advance tax of Quarter II for the AY 2023-24 15-09-2023
Filing Income Tax Returns Audit Reports under Section 44AB. (For 30-09-2023
3 the corporate-assessee or non-corporate assessee who is required to
submit his/its return of income on October 31, 2023)
Audit Report case of the assessee who has not entered into any 30-09-2023
4
international or specified domestic transactions

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 Foreign Exchange Fluctuation

Currency As on 31st Jul 2023 As on 31st Aug 2023 Fluctuation

US 82.65 82.71

GBP 105.61 104.87

EURO 90.68 89.71

JPY 0.57 0.56

 Stock Market Fluctuation

Stock
As on 31st Jul 2023 As on 31st Aug 2023 Fluctuation
Exchange

Sensex 66,527.67 64,831.41

Nifty 19,753.80 19,253.80

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 Goods and Services Tax Act, 2017
1. MERA BILL MERA ADHIKAAR SCHEME
https://www.gst.gov.in/newsandupdates/read/599
The Government of India, in collaboration with State Governments, is introducing
the ‘Mera Bill Mera Adhikaar’ Invoice Incentive Scheme from September 1st, 2023

i. Objective of the Scheme: The primary objective of the ‘Mera Bill Mera Adhikaar’
scheme is to drive a cultural and behavioural shift among the general public,
encouraging them to exercise their right and entitlement to request invoices for their
purchases.

ii. Scheme Details:

a. Initially launched as a pilot, the scheme will begin in the states of Assam,
Gujarat, and Haryana, along with the Union Territories of Puducherry, Dadra
Nagar Haveli, and Daman & Diu.
b. The minimum invoice value for eligibility in the lucky draw is set at Rs. 200.
c. Invoices can be uploaded via the mobile application ‘Mera Bill Mera
Adhikaar,’ available on both IOS and Android platforms, and on the web
portal ‘web.merabill.gst.gov.in.’

iii. Eligibility and Participation:

a. The scheme is open to all residents of India, regardless of their respective state
or UT.
b. Individuals can upload a maximum of 25 invoices per month on the app/web
portal to enter the lucky draw.
c. Upon uploading an invoice, an Acknowledgement Reference Number (ARN)
will be generated for prize draw purposes.

iv. Prize Structure:

a. Monthly draws will award 800 prizes with a prize money of Rs. 10,000 each,
along with 10 prizes of Rs. 10,00,000.
b. Quarterly (Bumper Draw) will feature 2 prizes with a whopping Rs.
1,00,00,000 each.
c. Eligibility for monthly draws includes all B2C invoices uploaded by the 5th of
the following month. For the bumper prize, a quarterly draw will consider
invoices uploaded over the last three months until the 5th of the bumper draw
month.

2. GST Notification 36/2023-Central Tax dt. 04-August-2023:

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 The notification states unique procedure for E-commerce operators for goods
supplied through them by composition taxpayers.
(i) Interstate supply shall not be allowed by the taxpayer,

(ii) the electronic commerce operator shall collect tax at source under sub-section (1)
of section 52 of the Act in respect of supply of goods made through it by the
composition taxpayer and pay to the Government and
(iii) E Commerce operator will mandatorily submit details of supply made through
them by composition taxpayer in FORM GSTR-8 on the common portal.

This notification shall come into force with effect from the 1st day of October, 2023.

https://taxinformation.cbic.gov.in/view-pdf/1009818/ENG/Notifications

 Income Tax Act, 1961

1. CBDT inserted New Rule 6ABBB. Form of statement to be furnished regarding
preliminary expenses incurred under section 35D
[Notification No. 54/2023/ F. No. 370142/24/2023-TPL]

https://incometaxindia.gov.in/communications/notification/notification-54-
2023.pdf

The amendment introduces Form No. 3AF for furnishing statements regarding
preliminary expenses incurred by taxpayers. This form must be submitted one
month prior to the due date for filing the income tax return. It should be furnished
electronically either under digital signature or through an electronic verification
code. The amendment also replaces Form No. 3AE in the Income-tax Rules, 1962,
with new forms to be used for audit reports under section 35D(4)/35E(6) of the
Income-tax Act, 1961. These changes are aimed at ensuring proper record-keeping
and transparency in the deduction of preliminary expenses.

They shall come into force with effect from the 1st day of April, 2024

2. CBDT notifies Ten Year Zero Coupon Bond of REC Ltd. under Section 2(48) of
Income tax Act, 1961
[Notification No. 56/2023/F. No.164/1/2023-ITA-1]
https://incometaxindia.gov.in/communications/notification/notification-56-
2023.pdf
The Ministry of Finance has issued Notification No. 56/2023 under the Income Tax
Act, 1961, specifying the details of a zero coupon bond issued by REC Ltd. The
notification designates the Ten Year Zero Coupon Bond of REC Ltd. with specific
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 terms and conditions as a zero coupon bond under clause (48) of section 2 of the
Income Tax Act, 1961. The bond has a ten-year one-month life period and is to be
issued on or before 31st March 2025. The maturity amount for each bond is 1 lakh
rupees, and the total discount is Rs. 2517.85 crores. The issuance will consist of five
lakhs bonds. Understanding the details of the zero coupon bond as per Notification
No. 56/2023 is essential for investors and stakeholders. The notification clarifies the
bond’s tax treatment and other relevant aspects for compliance with the Income Tax
Act, 1961.

3. New Income Tax Rules on Taxation of Life Insurance Policy Receipts with
Premiums Exceeding Rs. 5 Lakh
[Notification No. 61/2023/ F.No.370142/28/2023-TPL]

https://incometaxindia.gov.in/communications/notification/notification-61-
2023.pdf

The Ministry of Finance has issued Notification No. 61/2023, dated 16th August
2023, pertaining to a new amendment in the Income Tax Rules of 1962. This Sixteenth
Amendment focuses on the computation of income chargeable to tax related to the
sums received under life insurance policies. These guidelines outline the method for
calculating income from life insurance policies when the total annual premium
exceeds Rs. 5 lakh.

Analysis: The CBDT has introduced Rule 11UACA under the Income Tax
Amendment (Sixteenth Amendment) Rules, 2023, to govern the calculation of
income related to the maturity proceeds of life insurance policies issued after 1 April
2023, where the premiums paid are above Rs. 5 lakh. The rules Rule 11UACA
differentiate the computation based on whether the sum is received for the first time
or during subsequent years under the life insurance policy. The amendment, as
described in the notification, details the methodology to compute the income
chargeable to tax under clause (xiii) of sub-section (2) of section 56 of the Income-tax
Act, 1961. According to the new rules, life insurance policies issued after 1 April 2023
will be eligible for tax exemption on maturity benefits under Section 10(10D) of the
Income Tax Act, as long as the total premium paid annually does not exceed Rs. 5
lakh.

However, for policies with premiums exceeding Rs. 5 lakhs, the maturity proceeds
will be added to the individual’s income and subjected to applicable income tax rates.
This modification in the tax treatment of life insurance policies, excluding Unit
Linked Insurance Policies (ULIPs), was introduced in the Union Budget for the fiscal
year 2023-24. As per the CBDT notification, Section 10(10D) of the Income Tax Act
currently provides an exemption from income tax for the amount received from a life
insurance policy, including bonus allocations, subject to specific conditions. Starting
from the assessment year 2024-25, amounts received from life insurance policies
issued after 1 April 2023 (excluding ULIPs) will not be exempt under Section 10(10D)

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 of the Income Tax Act if the total premium paid in any previous year during the
policy term exceeds Rs. 5,00,000.

Conclusion: The Sixteenth Amendment to the Income Tax Rules, 1962, brings clarity
to the computation of income chargeable to tax related to life insurance policies. It
provides specific formulas to calculate the taxable income and clearly outlines the
exclusions. The CBDT’s comprehensive guidelines outline the computation of
eligible exemption for maturity proceeds from life insurance policies and include
illustrative examples. However, it’s important to note that the taxation provision for
amounts received upon the insured’s death remains unchanged and continues to be
exempt from income tax.

4. New Rule for TDS on Foreign Currency Income: Exchange Rate

[Notification No. 64/2023/F.No. 370142/27/2023-TPL]

https://incometaxindia.gov.in/communications/notification/notification-64-
2023.pdf

Introduction: The Ministry of Finance has issued a significant notification, No.

64/2023-Income Tax, on August 17, 2023, amending the Income-tax Rules, 1962. The
notification introduces a new rule, impacting the deduction of tax at source (TDS) on
income payable in foreign currency. The rule specifies the rate of exchange for
calculating the value of such income in rupees.

Analysis: The new rule, outlined in the notification, pertains to the deduction of TDS
on income paid in foreign currency. It outlines the specific scenarios where this rule
applies, including payments to an assessee outside India and to a Unit located in an
International Financial Services Centre. Additionally, the rule covers payments by a
Unit located in an International Financial Services Centre to an assessee in India. The
rule emphasizes that the rate of exchange used for TDS calculation will be the
telegraphic transfer buying rate of the foreign currency. This rate is determined as of
the date when the tax is required to be deducted at source. This update ensures that
the TDS calculation is based on the most current exchange rate, enhancing accuracy
and fairness in taxation. The notification provides explanations for key terms used in
the rule, such as “International Financial Services Centre,” “telegraphic transfer
buying rate,” and “Unit.” These clarifications aid in interpreting and applying the
rule correctly.

Conclusion: The Ministry of Finance’s recent notification, No. 64/2023-Income Tax,

introduces a vital amendment to the Income-tax Rules, 1962. The new rule specifies
the rate of exchange for TDS calculation on income payable in foreign currency,
ensuring accurate taxation and compliance. As businesses and individuals engage in
cross-border transactions, this rule will play a crucial role in maintaining
transparency and fairness in the taxation process. It is essential for taxpayers to be
aware of this development and ensure compliance with the updated regulations to
avoid any potential penalties or legal consequences.
Page 8 of 14
5. CBDT Amends Income Tax Rules for Valuation of Accommodation Perquisite
[Notification No. 65/2023/F. No. 370142/21/2023-TPL Part (1)]

https://incometaxindia.gov.in/communications/notification/notification-65-
2023.pdf

The Central Board of Direct Taxes (CBDT) has introduced an amendment to the
Income Tax Rules, 1962, relating to the valuation of perquisites for residential
accommodation provided by employers. The amendment, effective from September
1, 2023, brings changes to the categorization and limits of cities and populations,
along with revised perquisite rates based on the 2011 census. This press release
discusses the key aspects of the amendment and its implications.

Analysis: The Finance Act of 2023 incorporated amendments for the calculation of
perquisites concerning the value of rent-free or concessional accommodation
provided by employers to employees. As a result, the CBDT has modified Rule 3 of
the Income Tax Rules, 1962, to accommodate these changes. The amended rule
provides detailed guidelines for determining the value of residential accommodation
perquisites based on various scenarios and parameters. The significant changes
introduced by the amendment include a shift in categorization and limits of cities
and populations based on the 2011 census. The earlier perquisite rates of 15%, 10%,
and 7.5% have been revised to 10%, 7.5%, and 5% of the salary, respectively. The
revised rates are applicable according to the population criteria, categorizing cities
as per the census data. Furthermore, the amendment ensures that the valuation of
perquisites considers situations where an employee occupies the same
accommodation for more than one previous year, aiming for a fair tax implication.

Conclusion: The CBDT’s amendment to the Income Tax Rules, 1962, reflects the
government’s commitment to maintaining up-to-date and relevant regulations. By
incorporating the 2011 census data and adjusting the perquisite rates, the
amendment seeks to create a more balanced and accurate system for valuing
residential accommodation perquisites. Employers and employees alike will benefit
from the clarity and transparency provided by this amendment, enhancing the
overall efficiency of the taxation framework.

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 RBI / FEMA
1. Enhancing Transaction Limits For Small Value Digital Payments In Offline Mode
This has reference to the Reserve Bank of India Circular
CO.DPSS.POLC.No.S1264/02-14-003/2021-2022 dated January 03, 2022 on
"Framework for Facilitating Small Value Digital Payments in Offline Mode".

As announced in the Statement on Development and Regulatory Policies dated

August 10, 2023, the upper limit of an offline payment transaction is increased to Rs.
500. Other instructions mentioned in the framework shall continue to remain
applicable as before.

This directive is issued under Section 10(2), read with Section 18 of the Payment and
Settlement Systems Act, 2007 (Act 51 of 2007) and shall come into effect immediately.

CIRCULAR NO. CO.DPSS.POLC.NO.S526/02-14-003/2023-24, DATED 24-8-2023

Fair Lending Practice - Penal Charges In Loan Accounts
2.
Reserve Bank has issued various guidelines to the Regulated Entities (REs) to ensure
reasonableness and transparency in disclosure of penal interest. Under the extant
guidelines, lending institutions have the operational autonomy to formulate Board
approved policy for levy of penal rates of interest. It has been observed that many
REs use penal rates of interest, over and above the applicable interest rates, in case
of defaults / non-compliance by the borrower with the terms on which credit
facilities were sanctioned.

The intent of levying penal interest/charges is essentially to inculcate a sense of

credit discipline and such charges are not meant to be used as a revenue
enhancement tool over and above the contracted rate of interest. However,
supervisory reviews have indicated divergent practices amongst the REs with regard
to levy of penal interest/charges leading to customer grievances and disputes.
CIRCULAR NO. DOR.MCS.REC.28/01.01.001/2023-24, DATED 18-8-2023

RBI Launches उ म - Udgam - Centralized Web Portal For Searching Unclaimed

3 Deposits
The Governor, Reserve Bank of India today launched a Centralized Web Portal उ म
UDGAM (Unclaimed Deposits - Gateway to Access information). This portal has
been developed by RBI for use by members of public to facilitate and make it easier
for them to search their unclaimed deposits across multiple banks at one place.
The Reserve Bank of India had announced the development of a centralized web
portal for searching unclaimed deposits as part of the Statement on Developmental
and Regulatory Policies, dated April 6, 2023. Given the increasing trend in the
amount of unclaimed deposits, RBI has been undertaking public awareness
campaigns from time to time to sensitize the public on this matter. Further, through
these initiatives, the RBI has been encouraging members of public to identify and
approach their respective banks for claiming unclaimed deposits.

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 The launch of the web portal will aid users to identify their unclaimed deposits/
accounts and enable them to either claim the deposit amount or make their deposit
accounts operative at their respective banks. Reserve Bank Information Technology
Pvt. Ltd. (REBIT), Indian Financial Technology & Allied Services (IFTAS) and
participating banks have collaborated on developing the portal.
To begin with, users would be able to access the details of their unclaimed deposits
in respect of seven banks presently available on the portal. The search facility for
remaining banks on the portal would be made available in a phased manner by
October 15, 2023.

Section 42 Of The Reserve Bank Of India Act, 1934 - Cash Reserves Of Scheduled
4. Banks To Be Kept With Bank - Notified Banks To Maintain Additional Average
Daily Balance

In exercise of the powers conferred by sub-section (1A) of Section 42 of the Reserve

Bank of India Act, 1934, the Reserve Bank of India hereby directs that all Scheduled
Commercial Banks / Regional Rural Banks / all Scheduled Primary (Urban) Co-
operative Banks / all Scheduled State Co-operative Banks, shall maintain with the
Reserve Bank of India, with effect from the fortnight beginning August 12, 2023:

 an additional average daily balance over and above the average daily balance
required to be maintained under sub-section (1) of Section 42; and

 that the amount of such additional average daily balance shall not be less than
10 per cent of the increase in net demand and time liabilities between May 19,
2023 and July 28, 2023.

 Companies Act, 2013

Condonation of delay in filing of Form-3, Form-4 and Form-11 under section 67
of Limited Liability Partnership Act, 2008 read with section 460 of the Companies
Act, 2013 – reg.

1. Representations have been received by the Government that certain LLPs are
finding difficulties in filing Form- 3 (LLP Agreement and changes therein),
Form- 4 (Notice of appointment, cessation, change in name/
address/designation of a designated partner or partner and consent to become
a partner/designated partner) and Form- 11 (Annual Return of LLP) for various
reasons including due to mismatch in the master data in electronic registry of
the Ministry. Due to this, the records/data in the electronic registry are also not
being updated.

2. To address these difficulties faced by the LLPs and as part of Government’s

constant efforts to promote ease of doing business, the Ministry, in exercise of

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 its power under section 67 of the Limited Liability Partnership Act, 2008, has
decided to grant one-time relaxation in additional fees to those LLPs who could
not file the Form-3, Form-4 and Form-11 within due date and provide an
opportunity to update their filings and details in Master-data for future
compliances.

3. The salient features are as follows: -

 The Form-3 and Form-4 would be processed under Straight through Process
(STP) mode for all purposes except for change in business activities. The
stakeholders are advised to file these forms in sequential manner i.e., the filing
for old events date may be filed first and so on so as to update the master data
in proper manner.

 At the time of filing these forms, the pre-filled data as per existing master data
of the LLP shall be provided in each of above mentioned forms but the same
shall have the facility to edit. The onus of filing correct data would be on the
stakeholders. In case of mis-representation, the Designated Partner and the
professional certifying the form may be liable for adverse action as per
provisions of the law.
 The filing of Form-3 and Form-4 without additional fee shall be applicable for
the event dates 01.01.2021 and onwards. For events dated prior to 01.01.2021,
these forms can be filed with 02 times and 04 times of normal filing fees as
additional fee for small LLPs and Other than small LLPs respectively.
 The filing of Form-11 without additional fee shall be applicable for the
financial year 2021-22 onwards. Form-11 for previous years (prior to financial
year 2021-22) can be filed with 02 times and 04 times of normal filing fee as
additional fee for small LLPs and Other than small LLPs respectively.
 These forms shall be available for filing from 01.09.2023 onwards till
30.11.2023 (both dates inclusive).
 The LLPs availing the scheme shall not be liable for any action for delayed
filing of the Form-3, Form-4 and Form-11.
https://www.mca.gov.in/bin/dms/getdocument?mds=jYQ0wTBvMQwm
TluXHncG0A%253D%253D&type=open

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1. If a person is operating in different states, with the same PAN number, whether he
can operate with a single Registration?
2. Whether a person having multiple business verticals in a state can obtain for
different registrations?
3. Is there a provision for a person to get himself voluntarily registered though he may
not be liable to pay GST?
4. Who is a Casual Taxable Person?
5. Who is a Non-resident Taxable Person?
6. Is there any Advance tax to be paid by a Casual Taxable Person and Non-resident
Taxable Person at the time of obtaining registration under this Special Category?
7. Whether cancellation of Registration under CGST Act means cancellation under
SGST Act also?
8. Is there an option to take centralized registration for services under GST Law?

Answers
1. No. Every person who is liable to take a Registration will have to get registered
separately for each of the States where he has a business operation and is liable to
pay GST in terms of Sub-section (1) of Section 22 of the CGST/SGST Act.

2. Yes. In terms of the proviso to Sub-Section (2) of Section 25, a person having
multiple business verticals in a State may obtain a separate registration for each
business vertical, subject to such conditions as may be prescribed.

3. Yes. In terms of Sub-section (3) of Section 25, a person, though not liable to be
registered under Section 22 may get himself registered voluntarily, and all
provisions of this Act, as are applicable to a registered taxable person, shall apply
to such person.

4. Casual Taxable Person has been defined in Section 2 (20) of the CGST/SGST Act
meaning a person who occasionally undertakes transactions involving supply of
goods and/or services in the course or furtherance of business, whether as
principal, or agent or in any other capacity, in a State or a Union territory where he
has no fixed place of business.

5. In terms of Section 2(77) of the CGST/SGST Act, a non-resident taxable person

means any person who occasionally undertakes transactions involving supply of
goods and/or services whether as principal or agent or in any other capacity, but
who has no fixed place of business or residence in India.

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6. Yes. While a normal taxable person does not have to make any advance deposit of
tax to obtain registration, a casual taxable person or a non-resident taxable person
shall, at the time of submission of application for registration is required, in terms
of Section 27(2) read with proviso thereto, make an advance deposit of tax in an
amount equivalent to the estimated tax liability of such person for the period for
which the registration is sought. If registration is to be extended beyond the initial
period of ninety days, an advance additional amount of tax equivalent to the
estimated tax liability is to be deposited for the period for which the extension
beyond ninety days is being sought.

7. Yes, the cancellation of registration under one Act (say CGST Act) shall be deemed
to be a cancellation of registration under the other Act (i.e. SGST Act). (Section 29
(4)

8. No, the tax payer has to take separate registration in every state from where he
makes taxable supplies.

DISCLAIMER: The views expressed are strictly of the author and HVJ and Associates.
Information in this publication is intended to provide only a general outline of the subjects
covered. It should neither be regarded as comprehensive nor sufficient for making decisions,
nor should it be used in place of professional advice. HVJ and Associates and its team
accepts no responsibility for loss or damages arising from any action taken or not taken by
anyone using this publication.

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