[2016: The Year in Review] Today is the last day of Year 2016. There are number of things happened in 2016 but the ‘Demonetization of 500 & 1000 Bank-Notes’ attract attention not only in India but entire world shocked with ever bold decision of PM Modi. Apart from Demonetisation there are number of developments in Indian Economy which are as under:

New Taxes:

  • Krishi Kalyan Cess
  • Equalisation Levy

News Scheme:

  • The Income Declaration Scheme 2016
  • The Direct Tax Dispute Resolution Scheme, 2016
  • The Indirect Tax Dispute Resolution Scheme 2016
  • Pradhan Mantri Garib Kalyan Yojana, 2016

New Statute:

  • Insolvency and Bankruptcy Code 2016
  • The Real Estate (Regulation and Development) Act 2016
  • The Aadhaar (Targeted Delivery of Financial and other Subsidies, Benefits and Services) Act, 2016
  • The Benami Transactions (Prohibition) Amendment Act, 2016.

>>>Download Presentation ‘2016: The Year Under Review'<<<

December, 2016

Indirect Taxes

Ministry of Finance reiterate to meet the GST deadlines Rolled Out by 1 April 2017

Past Assessments will not be Reopened for the Reason of increased turnover on account of use of Digital Means

No Service Tax on Payment through Debit/Credit Cards up to Rs. 2,000

Direct Taxes

The Taxation and Investment Regime for Pradhan Mantri Garib Kalyan Yojana, 2016

Direct Tax Dispute Resolution Scheme- 2016 Extended up to 31st Jan, 2017

Clarifications on Indirect Transfer provisions (section 9(1)(i)

Reduction in Existing Rate of Deemed Profit u/s 44AD from 8% to 6% in respect of amounts/receipts through banking channel/digital

No Exemption have been Granted to Political Parties Post Demonetization

All Revised Returns after Demonetization will be Scrutinized

e-Payment Mandatory for Govt. Departments if Single Payment Exceeds Rs.5000

Personal Finance

ESI coverage on Wage ceiling has been increased to Rs.21,000/-

Bonus ceiling has been enhanced to Rs.7000/- and the eligibility limit has been raised to Rs.21000/-

Wages Act 1936: Crediting wages in bank account or with the existing provisions of payment in coin or currency notes.

After 30-12-2016, the old 500 & 1000 notes can deposited  with RBI Only (Nothing in Writing).


November, 2016

Indirect Taxes

(w.e.f. 01-12-2016) Online information and database access or retrieval services to other than non-assesse online recipient; Withdraw exemption from service tax for services provided by a person in non-taxable territory to Government, a local authority, a governmental authority or an individual; POP will be location of Service Provider

Reducing / eliminating physical printouts for customs clearance

Combined ST & EX Returns not required.

GST Portal goes live; GSTN made the www.gst.gov.in portal live for migration of existing assessees. The migration will take place in a staggered manner. The new portal is expected to be simple and will enable easy filing of returns and tax payments through credit/debit cards and other modes. A new provisional identification number will be generated for assessees

Revised Model GST Law, IGST Law and Draft Compensation Law 

Direct Taxes

There is no limit on holding of gold jewellery or ornaments by anybody provided it is acquired from explained sources of income including inheritance


October, 2016

Indirect Taxes:

Guidelines for launching of prosecution in relation to offences punishable under the Customs Act, 1962

Normal: Immediately After Adjudication

Gold, Arms, Explosives, Antiques, Art treasures, Wild Life Items: Immediately After Adjudication. 

Direct Taxes

IT Circular: Applicability of TDS provisions of section 194-I of the Income-tax Act, 1961 on lump sum lease premium paid for acquisition of long term lease

IT Circular: ​Taxability of the compensation received by the land owners for the land acquired under the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (‘RFCTLAAR Act’)


September, 2016

Indirect Taxes

No Service Tax on Transportation Services by Schools to Students etc. during April 2013 to July 2014

Adjudication Limit: Supdt. = 10 Lacs; AC/DC = 50 Lacs; JC/Addl. C = 2 Crore; C = ~

No Service Tax on advancement of Yoga (1-7-12 to 20-10-15); Mega Exemption  Notification changed on 21-10-15

1No Service Tax on Allotment of land on 30 yrs or more of lease by State Government Industrial Development Corporations

renting of precincts of a religious place meant for general public ( owned by charitable or religious trust under section 12AA)

Guidelines for arrest : 2 Crore Tax Collected but not deposited; proper investigation

Clarification: Renting of precincts of a religious place meant for general public.

GST: Honorable President has also accord his assent to the Bill on September 8, 2016.  The Bill post enactment shall be called Constitution (101st  Amendment) Act, 2016.; ide F. No. 31011/09/2015-SO (ST) dated 15th September, 2016, Hon’ble President has constituted the Goods and Services Tax Council (“GST Council “) consisting of the following members, namely:- The Union Finance Minister as the Chairperson The Union Minister of State in charge of Revenue or Finance as Member The Minister in charge of Finance

Draft Rules and Formats for Registration, Payment and Invoices for upcoming GST Law

Direct Taxes : IDS-I = Pay 45% Tax and on your Black Money


August, 2016

Indirect Taxes:

Clarification: Hiring of goods with out the transfer of the right to use goods;

Clarification: Services provided to the Government, a local authority or a governmental authority with regard to water supply

Clarification: No Service Tax on freight forwarders on transportation of goods from India if they engaged as principal to principal basis

GST Bill was passed by the Rajya Sabha; Amended bill was passed by the Lok Sabha;

Revised guidelines for disposal of confiscated goods: Below 5 lacs & Others


July, 2016

Indirect Taxes:

Instructions regarding provisional attachment of Property: Issue of Notice  giving  15 days time to reply before attaching the property.

Instruction: Permission to pay service tax through non electronic modes

Simplified Central Excise norms for jewellery sector

Circular: Manual signatures on digitally signed invoices

Scope of word ‘site’ appearing in Notification No. 12/2012-Central Excise, dated 17.03.2012

The Select Committee of the Rajya Sabha submitted its report on the bill on 22 July 2016. 

Direct Taxes: Paperless PAN & TAN application process; Aadhaar based e-Signature through M/s NSDL eGov


June, 2016

Indirect Taxes:

Exempt: Services by way of transportation of goods by a vessel from outside India upto the customs station in India (invoice issued on or before the 31st May 2016)

Senior Advocates: A new concept  in Service Tax Law came and gone.

Krishi Kalyan Cess (KKC) w.e.f. 01-06-2016 on taxable services @ 0.50%; Credit of KKC is allowed against output liability of KKC

CE: Own Trade Name on Garments Cannot be Treated as Branded Garment Regarding the scope of the levy of excise duty on readymade garments and made articles of textiles bearing a brand name or sold under a brand name and having a retail sale price of Rs. 1000 or more in this year’s Budget.

Ministry of Finance has Released Draft Model GST Law

Direct Taxes:

Tax Audit Threshold Limit in presumptive taxation u/s 44AD is Rs. 2 Crore Press Release 20-06-2012

Equalisation levy of 6 % of the amount of consideration for specified services


May, 2016

Indirect Taxes:

Exemption: Services provided by the organisations in respect of a religious pilgrimage facilitated by the Ministry of External Affairs of the Government of India, under bilateral arrangement, in the period from 01-07-2012 to 19-08-2014

Interest Rate Changes w.e.f. 14-05-2016 @ 15% (12% for assessee  of turnover upto 60 lacs) 24% in case ST collected but not deposited

GST: Lok Sabha  on 6 May 2015 passed  The Constitution (122nd Amendment) Bill, 2014 introduced by Finance Minister Arun Jaitley.

Rajya Sabha referred Bill to Select Committee

Direct Taxes:

IT Circular: ​Admissibility of claim of deduction of Bad Debt under section 36(1)(vii) read with section 36(2) of the Income-tax Act 1961

IT Circular: ​ Clarification regarding cancellation of registration u/s 12AA of the Income-tax Act, 1961 in certain circumstances

IT Circular: ​Printing & Publishing  activity is Manufacturing ;Additional depreciation u/s 32(1)(iia) of the Income-tax Act, 1961

IT Instruction: the income arising from transfer of unlisted shares, irrespective of period of holding, would be taxable under the head ‘Capital Gain’ except in certain circumstances where the Assessing Officer would examine the issue and take appropriate view


April, 2016

Indirect Taxes:

POT in case of services provided by the Government or local authority to any business entity, shall be the earlier of the dates on which payment made or Due.

Exclusion of Interest on Delay Payment- This is not apply In case of service provided by Government or a local authority to a business entity where payment for such service is allowed to be deferred on payment of interest or any other consideration

Exemption from Service Tax on certain services provided by Government or a local authority to business entity;

Renting of Motor-cab: Cost of fuel should be included in the consideration charged for providing renting of motor-cab services for availing the abatement.

Services provided by mutual fund agents/distributor to a mutual fund or asset management company are put under forward charge.

SCN issuance normal Period 30 Months from date of SCN.

All Services by Government will be taxed in hands of Recipient. 

Direct Taxes

Payment of interest on refund under section 244A of excess TDS deposited under section 195 of the Income-tax Act, 1961


March, 2016

Indirect Taxes:

One Person Co. upto 50 lacs turnover & HUF is at par with Individual.

Exemption: Services in relation to Information Technology Software recorded on a media bearing RSP, provided Central Excise Duty has been paid.

Education Services move from Negative list to Mega Exemption.

Threshold exemption to artist in folk or classical art forms of music, dance or theatre is enhanced from Rs 1 lakh to Rs 1.5 lakh charged per event

Services by Government or a local authority exempt upto amount not exceed Rs. 5000/-

Direct Taxes:

Revised guidelines for stay of demand at the first appeal stage: 15% of Demand; assessee may approach to Pr. Commissioner

CIT Appeal Form No 35 shall be Filed Electronically


February, 2016

Indirect Taxes:

Annual Information Return  by RBI (foreign remittances ) and Electricity companies (Electricity consumed)for specified class of persons Due date: 31st December

Now Full Cenvat Credit is Allowed on Import of ships boats etc.

Direct Taxes:

Issue of taxability of surplus on sale of shares and securities – Capital Gains or Business Income – Instructions in order to reduce litigation


January, 2016

Indirect Taxes:

Annual Information Return  by RBI (foreign remittances ) and Electricity companies (Electricity consumed)for specified class of persons Due date: 31st December

Now Full Cenvat Credit is Allowed on Import of ships boats etc.

Direct Taxes:

Issue of taxability of surplus on sale of shares and securities – Capital Gains or Business Income – Instructions in order to reduce litigation

>>>Download Presentation ‘2016: The Year Under Review'<<<

Put Your Comment Below