MM TAX CLUB

Customs (Waiver of Interest) Order, 2023

 Order No. 01/2023-Customs (N.T.)

WHEREAS, Sub-section (2) of section 47 of the Customs Act, 1962 (52 of 1962) (hereafter in this Order referred to as the said Act) provides –

                “(2) The importer shall pay the import duty –

(a) on the date of presentation of the bill of entry in the case of selfassessment; or (b) within one day (excluding holidays) from the date on which the bill of entry is returned to him by the proper officer for payment of duty in the case of assessment, reassessment or provisional assessment; or

(c) in the case of deferred payment under the proviso to sub-section (1), from such due date, as may be specified by rules made in this behalf; and if he fails to pay the duty within the time so specified, he shall pay interest on the duty not paid or short-paid till the date of its payment, at such rate, not less than ten per cent. but not exceeding thirty-six per cent. per annum, as may be fixed by the Central Government, by notification in the Official Gazette : ……”.

AND WHEREAS, the Central Government, by virtue of notification no. 28/2002-Customs (N.T.) dated the 13th May, 2002 published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide number G.S.R 359(E) dated the 13th May, 2002, fixed the rate of interest at fifteen per cent per annum for the purposes of the section 47;

AND WHEREAS, the third proviso below sub-section (2) of section 47 of the said Act is “PROVIDED ALSO that if the Board is satisfied that it is necessary in the public interest so to do, it may, by order for reasons to be recorded, waive the whole or part of any interest payable under this section”:

AND WHEREAS, the provisions of section 51A of the said Act, read with Customs (Electronic Cash Ledger) Regulations, 2022 are made applicable to deposits from 1st April, 2023, other than those exempted by virtue of notification no.18/2023-Customs (N.T.) dated 30th March, 2023 published in the Gazette of India, Extraordinary, Part II, Section 3, Subsection (ii) vide number S.O. 1528(E) dated the 30th March, 2023;

AND WHEREAS, alongside the Directorate General of Systems is also revamping integration mechanisms for data exchange between ICES and ICEGATE, ICEGATE and Banks and ICEGATE with other stakeholders;

AND WHEREAS, the trade has, in a large number of cases, faced the difficulty of being unable to complete the process whereby accounting is made in the duty payment process initiated by them because of unanticipated technical difficulties on the Common Portal and with the authorized banks, from 01.04.2023 onward, as a result whereof, the interest is arising.

AND WHEREAS, the said technical difficulties, arising notwithstanding prior testing, are being resolved by the Directorate General of Systems, as they are encountered, and the new framework is being stabilized, while in the interim, because of said difficulties the interest also accumulates daily in the technical system in giving effect to the provisions of the sub-section (2) of section 47; AND WHEREAS, had the said difficulties not arisen, the legitimate trade would not have been subjected to calculation of interest on the Common Portal;

AND WHEREAS, in terms of Section 143AA of the said Act, the Board may also for the purposes of facilitation of trade take measures to reduce the transaction cost of clearance;

NOW, THEREFORE, in exercise of the powers conferred by the third proviso below subsection (2) of section 47 of the Customs Act, 1962, the Central Board of Indirect Taxes and Customs, being satisfied that it is necessary in the public interest so to do, hereby makes the following Order, namely:-

1. Short title. — This Order may be called the Customs (Waiver of Interest) Order, 2023.

2. The Central Board of Indirect Taxes and Customs, hereby waives the whole of interest payable under sub-section (2) of section 47 of the said Act, for the period from 1st April, 2023 upto and including the 10th April, 2023, in respect of such goods, where the payment of import duty is to be made from the amount available in electronic cash ledger:

3. The waiver would be applied on the Common Portal. In respect of Bills of Entry for which import duty payment has already occurred and integrated in ICES during the said period, a claim for refund of interest shall be subject to the provisions of Section 27 of the said Act.

The Income Tax (I-T) department has been given an internal target of issuing refunds within a period of seven days.

This came up during the process of drafting the budget. Meeting such a short deadline is a challenge in itself.

However, the department has also been able to reduce the average time taken for issuing refunds in the financial year 2022- 23 to 16 days as against 26 in the fiscal before.

The country has also achieved the highest-ever direct tax collection of RS 16.61 lakh crore.

This was revealed by the chairman of the Central Board of Direct Taxes (CBDT) Nitin Gupta who expressed that the time can be further shortened.

The CBDT is the apex body governing the department. He was addressing the passing out ceremony of the 75th batch of Indian Revenue Service (IRS) joining the department after their training at the National Academy of Direct Tax (NADT) in Nagpur.

Gupta said the amount of refunds issued during the financial year 2022-23 has been higher by Rs 18,000 crore as compared to its previous fiscal. In the year as much as 42 per cent of the returns were processed within 24 hours and even the refunds were issued at the same pace.

The Indian tax administration has surpassed even that of the advanced countries when it comes to aspects like electronic filing, said Gupta.

He said as much as 7.5 crore returns were filed through the e-filing two portals and 72 lakh returns were filed on a single day July 31 which was the last date of filing.

The department has also changed the way in which it communicates with the taxpayers having its own Twitter handle and a quick response team to grievances. This has led to higher collections and even the cost of collection has gone down, said Gupta.

Gupta also said that the department is watchful of the tax evaders and has been able to create credible deterrence through using technology. This has helped in flagging off errors or discrepancies in declarations or the accounts by the assesses which has helped in detecting evasion of tax.

The deterrence is achieved through the data which the department has leading to a non-intrusive manner of checking tax evasion. The taxpayer is shown all the financial transactions taken by him through the annual information system. This nudges the assess to pay the proper dues, he said.

In 2022-23 a system of updated returns by paying additional tax ranging from 25 per cent to 50 per cent extra tax for a period of two years.

This has led to a reduction in litigation. There are times when certain details are genuinely missed in the returns without these can be included in the updated returns, he later told TOI.

In the last fiscal as much as 20 lakh such returns were filed getting a collection of Rs 1500 crore, he said.

TRADE CIRCULAR No. 01/2023 DATED: 29.03.2023

Generation and quoting of Document Identification Number (DIN) on communications issued under GST by the officers of the Directorate to tax payers and other concerned persons.

                In keeping with the objectives of transparency and accountability in the administration of GST laws through widespread use of information technology, the Directorate of Commercial Taxes is implementing a system of electronic generation of Document Identification Number (DIN), hereinafter to be referred to as ‘WBGST DIN’, for those communications under GST that cannot be generated through GSTN portal, to be sent by the officers to the taxpayers or other concerned persons. Initially the WBGST DIN would be used for summons, arrest memos, search authorizations, inspection notices, recovery proceedings etc. as specified in para 5 of this Circular, relating to a tax payer/ taxable person/any person, as the case may be. This measure would create a digital directory for maintaining a proper audit trail of such communications. Besides, it would provide the recipients of such communications a digital facility to ascertain the genuineness of such communications. Subsequently, WBGST DIN may be extended to other communications.

The Commissioner, in exercise of the power under section 168 of the WBGST Act, 2017, directs that–

(a) all communications under the WBGST Act and rules made thereunder by officers, not below the rank of State Tax Officer of any Charge / Circle / Large Taxpayer Unit/ Unit or Zone of Bureau of Investigation, as the case may be, shall contain an electronically generated WBGST DIN from the online system of the Directorate of Commercial Taxes excepting in the following cases:-

(i) when any such communication is made through the GSTN portal containing a unique reference number;

(ii) when any communication is made from the offices under the Directorate of Commercial Taxes other than any Charge/Circle/Large Taxpayer Unit/Unit or Zone under Bureau of Investigation;

(iii) when FORM GST MOV-01 and FORM GST MOV-02 are issued manually by the authorized officer who is outside the office while discharging his official duties.

(b) WBGST DIN so generated shall be quoted prominently on the body of communications like summons, arrest memos, search authorizations, inspection notices, recovery proceedings and such other communications relating to a tax payer/taxable person/any person, as the case may be.

(c) when the communication is made by e-mail then the WBGST DIN shall be quoted on the body of the e-mail

3. Notwithstanding anything mentioned in para 2 of this circular, in exceptional cases mentioned below, communications will be made without WBGST DIN:–

(a) when there are technical difficulties in generation of WBGST DIN electronically; or

(b) when communication regarding investigation/inquiry, verification etc. is required to be issued in short notice or in urgent situations and the authorized officer is outside the office while discharging his official duties:

                Provided that where the WBGST DIN could not be generated due to reasons specified in clause (a) above, the officer shall generate the corresponding WBGST DIN post facto within three working days from the date when such difficulties are overcome, and communicate such WBGST DIN to the recipient in the prescribed format given below.

Provided further that where the WBGST DIN could not be generated due to reasons specified in clause (b) above, the officer shall generate WBGST DIN post facto within three working days from the date of issue of such communication and such WBGST DIN should also be communicated to the recipient in the prescribed format.

4. The Commissioner also directs that, subject to para 3 above, any communication, specified in para 2, which does not bear the electronically generated WBGST DIN shall be treated as invalid and shall be deemed to have never been issued.

5. The WBGST DIN will be generated for the following categories of communication, viz.

                i) Summons

ii) Arrest Memos

iii) Search authorisations

iv) Inspection notices

v) Other communications, such as:

                (a) Notice for return default

(b) Notice for interest default

(c) Notice for physical appearance

(d) Notice/request against any mismatch for reconciliation

(e) Intimation for recovery

(f) Intimation for bank garnishee

(g)Request for production of documents/ books of accounts

(h) Any other communication

6. Structure of WBGST DIN issued by Directorate of Commercial Taxes, West Bengal: -

The structure is WBGST/1015/240123/023NNN (sample), where–

•  WBGST is common prefix,
• The first digit 1 in 1015 stands for office type (can be either 1 for other offices or 2 for circles or 3 for charges),
• The second, third and fourth digits 015 in 1015 stands for office code,
• 240123 stands for date of generation of WBGST DIN in DDMMYY format,
• 023 stands for serial number starting from 001 for a particular office and a particular date and NNN denotes 3-digit alpha-numeric system generated random number.

7. The genuineness of such communication can be ascertained by the recipient (tax payer/ taxable person/any person) through the website of the Directorate of Commercial Taxes (https://www.wbcomtax.gov.in) using the WBGST DIN itself in the manner detailed below:–

DIN search page has a search field to type the WBGST DIN. After typing, user needs to click on the “Search” button. In case of a valid WBGST DIN, the details of DIN, i.e., DIN status, DIN date (of generation) and name of the office wherefrom the DIN was generated will be displayed. In the case of an invalid WBGST DIN, a message that “No data available in table” will be displayed.

8. This Trade Circular shall come into force with effect from 1st day of April, 2023.

In exercise of the powers conferred by clause (46) of section 10 of the Income-tax Act, 1961(43 of 1961), the Central Government hereby notifies for the purposes of the said clause, ‘Bhadohi Industrial Development Authority’, (PAN AAALB0141M), an Authority constituted by the state government of Uttar Pradesh, in respect of the following specified income arising to that Authority, namely:

(a) Money received from the disposal of land/90 year’s lease of immovable properties;

(b) Money received by the way of lease rent & fees or any other charges from the disposal/90 years lease of immovable properties;

(c) The amount of interest/penalties received on the deferred payment received from the allottees of various immovable properties;

(d) Water, sewerage and other municipal charges from the allottees of various immovable properties; and

(e) Interest earned on (a) to (d) above.

2. This notification shall be effective subject to Bhadohi Industrial Development Authority:-

(a) shall not engage in any commercial activity;

(b) activities and the nature of the specified income shall remain unchanged throughout the financial years; and

(c) shall file return of income in accordance with the provision of clause (g) of sub-section (4C) of section 139 of the Income-tax Act, 1961.

3. This notification shall be deemed to have been applied for the financial year 2020-2021 (for period from 01-06-2020 to 31-03-2021) and for the financial years 2021-2022 to 2022-2023.

Circular No. 04 of 2023 Dated: 5th April, 2023

Vide Finance Act, 2023, sub-section (lA) has been inserted in section 115BAC of the Income-tax Act, 1961 ( the Act) to provide for a new tax regime with effect from the assessment year beginning on or after the 1 st day of April, 2024. This regime applies to an individual or Hindu undivided family or association of persons [other than a cooperative society] or body of individuals, whether incorporated or not, or an artificial juridical person. Under this new regime, the income-tax in respect of the total income of the person shall be computed at the rates provided in sub-section (1 A) of section 115BAC, subject to certain conditions, including the condition that the person does not avail of specified exemptions and deductions.

The above mentioned new tax regime is the default tax regime applicable to all persons mentioned above. However, under sub-section (6) of section 115BAC of the Act, a person may exercise an option to opt out of this tax regime. A person not having income from business or profession can exercise this option every year.

            Representations have been received expressing concerns regarding tax to be deducted at source (TDS) on salary income of a person under section 192 of the Act as the deductor, being an employer, would not know if the person, being an employee, would opt out from taxation under sub-section (1 A) of section 115BAC ofthe Act or not.

            In order to avoid the genuine hardship in such cases, the Board, in exercise of powers conferred under section 119 of the Act, hereby directs that a deductor, being an employer, shall seek information from each of its employees having income under section 192 of the Act regarding their intended tax regime and each such employee shall intimate the same to the deductor, being his employer, regarding his intended tax regime for each year and upon intimation, the deductor shall compute his total income, and deduct tax at source thereon according to the option exercised.

            If intimation is not made by the employee, it shall be presumed that the employee continues to be in the default tax regime and has not exercised the option to opt out of the new tax regime. Accordingly, in such a case, the employer shall deduct tax at source, on income under section 192 of the Act, in accordance with the rates provided under sub-section (lA) of section 115BAC of the Act.

            It is also clarified that the intimation would not amount to exercising option in terms of sub-section (6) of section 115BAC of the Act and the person shall be required to do so separately in accordance with the provisions of the sub-section.

            This circular is in supersession of Circular No. Cl of2020 dated 13.04.2020 and shall be applicable for TDS during the financial year 2023-24 and subsequent years.