May-2015

ECONOMY UPDATES
Income Tax
CBDT Notifies Revised Transport
allowance exemption limit
CBDT vide Notification No. 39/2015dated:
13th April 2015 has increased Transport
allowance exemption limit for employees
from Rs. 800 to Rs. 1,600 per month.
In case the employee is blind or
orthopaedically handicapped with
disability of lower extremities the limit is
increased from Rs. 1600 to Rs. 3200/- per
Month. The revised exemption Limit is
applicable from A.Y. 2016/17 /F.Y 2015-
16.
Providing of Roll Back in respect of
Advance Pricing Agreement (APA) -
Extension of time
In exercise of the powers conferred by
sub-sections (9) and (9A) of section 92CC
read with section 295 of the Income-tax
Act, 1961 (43 of 1961), the Central Board
of Direct Taxes makes Income-tax (Fourth
Amendment) Rules, 2015 further to
amend the Income-tax Rules, 1962. In the
Income-tax Rules, 1962 (hereafter referred
to as the principal rules), in rule 10MA, in
sub-rule (5), for the first proviso and the
second proviso, the following provisos
shall be substituted, that in a case where
an application has been filed on or before
the 31st day of March, 2015, Form No.
3CEDA along with proof of payment of
additional fee may be filed at any time on
or before the 30th day of June, 2015 or
the date of entering into the agreement
whichever is earlier: Provided further that
in a case where an agreement has been
entered into on or before the 31st day of
March, 2015, Form No. 3CEDA along with
proof of payment of additional fee may
be filed at any time on or before the 30th
day of June, 2015 and, notwithstanding
anything contained in rule 10Q, the
agreement may be revised to provide for
rollback provision in the said agreement in
accordance with this rule.”
Source: Notification No. 33/2015/
F.No.142 /14/2014-TPL dated: 1st April,
2015
Read more at: http://www.incometaxindia.
gov.in/communications/notification/
notification33_2015.pdf
Capital gains in respect of units
of Mutual Funds under the fixed
maturity Plans on extension of their
term
In case of mutual funds, the unit of a
mutual fund constitutes a capital asset and
any sale, exchange or relinquishment of
such unit is a “transfer” under clause (47)
of section 2 of the Act. The roll over in
accordance with the aforesaid regulation
will not amount to transfer as the scheme
remains the same. Accordingly it is
clarified that no capital gain will arise at
the time of exercise of the option by the
investor to continue in the same scheme.
The capital gains will however arise at the
time of redemption of the units or opting
out of the scheme, as the case may be
vide Circular No 6 of 2015 dated 9th April
2015.
Requirement of tax deduction at
source in case of corporations
whose income is exempted under
Section I0 (268B8) of the Incometax
Act, 1961 - Exemption thereof
CBDT has decided that since the
corporations covered under Section
10(26888) satisfy the two conditions of
Circular No. 4/2002 i.e. unconditional
exemption of income under Section 10
and no statutory liability to file return
of income under Section 139, any
corporation whose income is exempted
under Section 10(26BBB) of the Act
will also be entitled to the benefit of
the said Circular. Hence there would
be no requirement for tax deduction at
source from the payments made to such
corporations since their income is anyway
exempted under the Act vide Circular No.
7 of 2015 dated April 23, 2015.
Computation of Income and
Disclosure Standards u/s. 145
notified by Government w.e.f. 1st
April, 2015
Government notified Computation of
Income and Disclosure Standards for
purpose of Section 145, w.e.f. 1st April,
2015. This notification described detailed
information about method of Accounting
and Income Computation and Disclosure
Standard-I relating to Accounting Policies.
The Central Government hereby notifies
the income computation and disclosure
standards as specified in the Annexure to
be followed by all assessees, following
the mercantile system of accounting,
for the purposes of computation of
income chargeable to income-tax under
the head “Profit and gains of business
or profession” or “ Income from other
sources”. This notification shall come
into force with effect from 1st day of April,
2015, and shall accordingly apply to the
assessment year 2016-17 and subsequent
assessment years vide Notification No.
32/2015, F. No. 134/48/2010-TPL dated:
31st March, 2015.
Foreign Trade
Highlights: Foreign Trade Policy
2015 -2020
A. SIMPLIFICATION & MERGER OF
REWARD SCHEMES
Export from India Schemes:
1. Merchandise Exports from India
Scheme (MEIS)
(a) Earlier there were 5 different schemes
(Focus Product Scheme, Market
Linked Focus Product Scheme, Focus
Market Scheme, Agri. Infrastructure
Incentive Scrip, VKGUY) for rewarding
www.icmai.in
MAY 2015 the MANAGEMENT ACCOUNTANT 99