Giving more teeth to SEBI for clamping down on illicit money-pooling schemes and other frauds, the Government has notified a new law empowering the regulator
The union government has notied the Securities Laws Amendment Act that would empower market regulator Securities and Exchange Board of India (SEBI) to pass orders for attachment of properties, arrest of defaulters and to access call data records.
The Securities Laws Amendment Act, which was cleared by Parliament earlier this month, amends all legislations governing capital markets, would also facilitate setting up of a special SEBI court to fast-track investigation and prosecution process, including by granting approval for search and seizure operations in suspected cases of frauds.
The Act, which has come into force through a gazette notification dated 25th August, is part of the government and regulators’ efforts to tighten the noose around fraudsters in the wake of several cases of illicit money-pooling activities including by ponzi operators in various parts of the country.
The new Act has as many as 57 clauses to amend various sections of the SEBI Act and two other related legislations.
The Bill was passed by the Lok Sabha on 6th August and in Rajya Sabha on 12th August.
The notification comes more than one year after the first ordinance was promulgated in July 2013 to grant these additional powers to SEBI. The ordinance was promulgated for the second time in September last year, followed by a third ordinance in January, as a bill could not be passed in Parliament at that time to grant permanent powers to SEBI.
The third ordinance also lapsed late last month, leaving SEBI without these extra powers which were used by the regulator in nearly 1,500 cases during their validity period.
The ordinance, which had 30 clauses, was brought in against the backdrop of lakhs of small investors being duped by numerous fraudulent investment schemes across the country, like in the alleged Saradha scam in West Bengal.
The decision to fix pension entitlement of Rs1,000 under the EPFS-95 scheme will immediately benefit around 28 lakh pensioners who at present are receiving less than this amount
The Employees’ Provident Fund Organisation (EPFO) said it would start implementing its much awaited Rs1,000 minimum monthly pension and Rs15,000 higher wage ceiling social security schemes from 1 September 2014.
The government’s decision to fix pension entitlement of Rs1,000 under the Employees’ Pension Scheme 1995 (EPFS-95) will immediately benefit 28 lakh pensioners who get less than this amount at present.
The move to enhance the minimum wage ceiling for becoming a subscriber of EPFO to Rs15,000 per month is expected to bring about 50 lakh additional formal sector workers under the ambit of the PF body.
The government has also enhanced the maximum sum assured under Employees’ Deposit Linked Insurance (EDLI) Scheme to Rs3 lakh. The maximum sum assured under the EDLI works out to be Rs3.6 lakh including 20% ad hoc benefit over the prescribed amount under the notification.
This means that in case an EPFO subscriber dies, his family will be entitled to maximum sum assured of Rs3.6 lakh instead of existing Rs1.56 lakh.
The decision to provide the entitlement under EPS-95 was taken by the Union Cabinet in its meeting held on 28th February. However, it could not be implemented as the model code of conduct came into force after the general election dates were announced on 5th March.
The decision will immediately benefit about 28 lakh pensioners, including 5 lakh widows. In all, there are 44 lakh pensioners under the EPFO scheme.
The CBDT order has created a lot of confusion among taxpayers and tax professionals by not specifying the due date for filing the income tax returns
The Central Board of Direct Taxes (CBDT) has vide its above order extended the due date for e-filing of Tax Audit Report to 30 November 2014 for AY2014-15 from 30 September 2014. The order has not mentioned anything about the due date for e-filing of Income tax Return (ITR). It seems the due date for filing of ITR has been kept the same, viz. 30th September 2014. The Assessee’s who are covered under tax audit provisions of section 44AB, but not under transfer pricing provisions as required by section 92E, do not file the ITR on or before 30 September, 2014, may have the following implications:-
1. He may have to pay interest u/s 234A of the Income Tax Act, 1961 on taxes outstanding.
2. Losses if any may not be allowed to be carried forward under the provisions of section 80 Read with section 139(3) of the Income tax Act, 1961.
3. To claim deduction of statutory expenses falling under section 43B, the assessee will have to pay these statutory dues on or before the filing of ITR or the due date of filing the return (due date of return of income-ROI is 30 September 2014), whichever is earlier.
4. Some of the deductions i.e. under Section 10A, which requires the assessee to file his return on or before the due date specified under sub section (1) of section 139, may not be allowed to the assessee.
5. If the assessee is not able to file his return on or before 30 September 2014, he may not be able to revise his return of income.
6. In true terms for the tax professional as evident from the Order, there is no extension of date for submission of tax audit report as most of the professionals prepare the ITR only after completion of tax audit report. This is so because certain disallowances are directly linked to the tax audit findings.
7. The tax audit report has to be filed by the chartered accountant through his login ID on the I-T website under client's PAN, which the client has to accept and only then can the return be filed. In such circumstances if the return filing date is not also extended the clarification issued has no meaning.
The CBDT Order has created a lot of confusion amongst the taxpayers and tax professionals by not specifying the due date for filing the ITR. The CBDT needs to immediately clarify its stand on the due date for ITR filing. A simple sentence adding the line in bold given below would have made things clearer:
“In exercise of power conferred by section 119 of the Income-tax Act (‘the Act’), the Central Board of Direct Taxes (CBDT) hereby extends the due date for obtaining and furnishing of the report of audit under section 44AB of the Act for Assessment Year 2014-15 in case of assessees who are not required to furnish report under section 92E of the Act from 30th day of September, 2014 to 30th November, 2014 and consequently also extend the due date for filing the return of income under section 139 for all assessees covered under section 44AB to 30th November, 2014.
Just that simple addition would have avoided all the confusion. In fact there is still time for the CBDT to come out with a clarification to the clarification already issued to clear the air of confusion which has been brought to bear on the tax filing community.
(Girish Borkar is a Mumbai-based Chartered Accountant and a managing partner of M/s Borkar & Shenoy, Chartered Accountants. He can be contacted at [email protected])