MM TAX CLUB

The CBI has announced a reward of Rs 1 lakh for providing information on IRS officer Santosh Karnani who is "absconding" since October 4 after his name surfaced in a Rs 30 lakh alleged bribery case, officials said on Thursday.

The central probe agency has also got a non-bailable warrant of arrest against the officer from a special CBI court as he has "not joined the investigation" after four notices from the agency, they said.

The agency had carried out searches at 21 locations on November 19 and 21 at the premises of some relatives and others, including some Income Tax officials, which led to the recovery of incriminating documents, articles and investment of Rs 41.96 lakh in the form of Fixed Deposits, they said.

The documents recovered during searches are being scrutinised, they said.

The officer posted as additional Income Tax commissioner class-I in Ahmedabad had allegedly demanded Rs 30 lakh bribe from builder Rupesh Bramhabhatt.

The Income Tax Department had conducted searches at Bramhabhatt's offices and prepared an appraisal report which was handed over to the Central Circle-1 of Ahmedabad for issuing a "demand notice", according to his complaint.

Karnani, who took over the case, allegedly demanded the bribe for not doing anything which could cause a huge financial loss to the complainant, said the First Information Report (FIR).

Karnani had called Bramhabhatt for a meeting on October 3 where the officer allegedly asked him to deposit the bribe with the 'angadia' firm account in the name of one 'Vardhaman', the CBI FIR alleged.

Meanwhile, the CBI investigation revealed that the Vardhman account with the courier service, in which the bribe was deposited, was allegedly owned by one Malav Mehta, they said.

The builder had complained to the Anti-Corruption Branch of Ahmedabad Police, which launched a trap operation on October 4, but the officer allegedly managed to give them a slip, they said.

Karnani was transferred to Guwahati nearly a week after the trap operation but he has not joined the office and is on "unauthorised leave", they said.

The Gujarat government had handed over the matter to the CBI which has issued four notices so far but the officer did not join the investigation.

The CBI opened a look out circular against the 2005-batch officer to prevent any misadventure by him to leave the country and conducted searches at several locations, including his native place in Jaipur, they said.

During the probe, it had emerged that the officer was habitually seeking huge bribes, they alleged.

The central probe agency has found that Karnani was in the "Agreed List" of the government since 2015 yet he kept getting important postings in the department, they said.

The government officers against whom there are "complaints, doubts or suspicion" related to honesty or integrity are put in "Agreed List" after consultations between the officers of the departments concerned and the CBI.

They said the agency is also looking into the aspect as to how an officer in the agreed list was being given sensitive postings which brings under scanner the role of senior officers involved in the process.

The Department of Consumer Affairs under the Ministry of Consumer Affairs, Food and Public Distribution vide Notification No. G.S.R. 859(E) dated November 30, 2022, amended Legal Metrology (Packaged Commodities) Rules, 2011.

The amendments are as following:

1. The rules may be called the Legal Metrology (Packaged Commodities) (Amendment) Rules, 2022

2. They shall come into force on the date of their publication in the Official Gazette.

Further, Legal Metrology (Packaged Commodities) (Amendment) Rules, 2022 has been amended to the effect that in Sub-rule (2) of Rule 1, the words “1st day of December 2022” have been substituted with “1st Day of January 2023”.

Therefore, the Sub-Rule (2) of Rule 1 of Legal Metrology (Packaged Commodities) (Amendment) Rules, 2022 shall be read as:

(1) Short title and Commencement.-

(2) They shall come into force on the 1st Day of January 2023.

Meaning thereby, the Legal Metrology (Packaged Commodities) (Amendment) Rules, 2022, shall come into force on the 1st Day of January 2023.

The wastage of gold during the creation of ornaments cannot be treated as making charges and the provisions of Section 194C would not be applicable to the assessee for non-deduction of TDS on the amount of such wastage, according to an order of the Income Tax Appellate Tribunal (ITAT), Chennai.

In an interesting order dated August 24, 2022, the ITAT dismissed an order of the Assessing Officer (AO), which had held that TDS under Section 194C would be applicable to the amount of gold treated by a jeweller as wastage and kept by the goldsmith as making charges. Here’s a look at this case and what the ITAT said.

The Case

The assessee was engaged in the manufacturing of gold and silver jewellery. During the assessment proceeding, the AO noted that the assessee had purchased old gold from customers and the same was melted through goldsmiths to get pure gold.

As per the facts of the case mentioned in the ITAT order, the assessee had issued 146331.79 gram of gold to goldsmiths for making new jewellery during the assessment year 2013-24 but received back only 141397.61 gram and the balance of 1294.66 gram was left with the goldsmiths, with the assessee claiming wastage of 5454.03 gram of gold in the process.

Similarly, in the assessment year 2014-15, the assessee claimed wastage of 1286.03 gram of gold during the making process. However, the AO noted that for all other jewellery, the assessee had shown charges ranging between 4.5% to 6% but the wastage would only be in the range of 0.5% to 1% and the excess rate of gold claimed by the assessee was actually the gold retained by the goldsmiths in lieu of making charges.

During the recording of the statement of goldsmiths, the AO received contrary statements where some claimed wastage in the range of 5% to 6% while others claimed the wastage was only in the range of 0.5% to 1%. The AO then treated this wastage as payment to goldsmiths without deduction of tax under section 194C of the Income Tax act.

The AO rejected the assessee’s contention that tax need not be deducted at source when consideration is not paid in cash or cheque. “Hence, in view of the above findings, the wastage is restricted to 1% of the gold retained by the goldsmith. Wastage in excess of this 1% is treated as gold in lieu of making charges which work out to 4328.08 gm,” the AO said.

The assessee challenged the AO’s order before CIT (A) which also confirmed the action of the AO. CIT (A) noted that almost all goldsmiths had admitted before the AO that during the manufacturing process they will retain gold around 5% of the input which is claimed by the assessee as wastage. According to CIT (A), the assessee was liable to deduct TDA on this claim of wastage as per Section 194C of the Income Tax Act. Aggrieved with the CIT (A) order, the assessee appealed before the ITAT.

What ITAT said

The ITAT held that TDS cannot be deducted by treating the gold claimed as “wastage” during making as no payment was made through cash, cheque or drafts or by any other made.

“…in the present case the issue of wastage whether it is 0.5% to 1% as estimated by Revenue or it is 4.5% to 6% as claimed by assessee, it neither involves any payment or credit of such sum by way of cash, issue of cheque or draft or by any other mode and hence does not liable for TDS u/s.194C of the Act. Hence, the disallowance made by AO and confirmed by CIT(A) is deleted,” the ITAT said.

Old private sector lender, City Union Bank (CUB), said the Goods and Services Tax Network, under the auspices of the GST Council, has included CUB as one of the banks available for paying GST.

“Now, all City Union Bank customers can pay their GST dues payable to the Government through their bank account on the GST Portal. Customers need to select City Union Bank and pay the tax amount. The addition of CUB by the GST Council to the existing list of banks is an added credential to the robust technology platform of City Union Bank. CUB has always been offering numerous innovative offerings to SME & Corporate customers to enable easy and safe financial transactions," said a statement.

“We use advanced technology to enable our customers to make their financial transactions easy, safe, and secure. As we are a bank focussed on MSME customers, they would now find it convenient to pay GST through CUB,” said N Kamakodi, MD and CEO, CUB.

City Union Bank’s digital solutions include - digital signatures, QR codes, Video KYC, and digital payment solutions, such as UPI 123pay, payment on the go through wearables, enhanced payment limit for online transactions, and soft launch of voice biometric authentication for mobile banking.

Till 30th November, 2022, a total of 30.34 lakh central government pensioners has been used DLC successfully, in which 2.82 lakh DLC has been created through Face authentication

The Department of Pension & Pensioners’ Welfare, Ministry of Personnel, Public Grievances and Pensions, Government of India this year has launched a nation-wide campaign for promotion of Digital Life Certificate for Central Government pensioners. The objective of this Nation-wide campaign is to promote the use of Face Authentication technology and DLC thereby ensuring transparency and Ease of Usage. All the registered Pensioners’ Associations, Pension Disbursing Banks, Ministries of Government of India and CGHS Centers had been directed to promote the Digital Life Certificate/Face Authentication Technique for giving Life Certificate by organizing special camps for ‘Ease of Living’ of pensioners.

Due to increasing awareness, the popularity of Face authentication is gaining popularity and has been able to provide a huge relief especially to the aged and infirm elderly population. Till 30th November, 2022, a total of 30.34 lakh central government pensioners has been used DLC successfully, in which 2.82 lakh DLC has been created through Face authentication.

To promote the campaign, State Bank of India and in certain cities the Punjab National Bank joined hands with the Department and provided the Camp venues in different cities. Different officials of DoPPW have been nominated at different cities to oversee the progress of the Campaign. During 1-30 November, 2022, special awareness camps have been organized in different cities all over India from Srinagar in the North to Nagercoil (Kanyakumari District) in the South and from Guwahati in the East to Ahmedabad in the West. Specific cities covered in this Campaign are Delhi (Hauzkhas, Pankha Road, Chanakyapuri, Jangpura) , Noida, Chandigarh, Mohali, Srinagar (J&K), Nagpur, Pune (Maharashtra),  Allahabad,  Jammu, Jalandhar, Gwalior (MP), Thrissur (Kerala), Madurai, Nagercoil, Vadodara, Ahmedabad, Guwahati (Assam), Hyderabad, Ambernath , Mumbai, Bhubaneshwar , Balasore, Cuttack (Orissa), Thiruvanthapuram, Jaipur, Chennai, Karaikal , Puducherry , Dehradun, Jagadari (Haryana), Hoogly, Howrah, Kolkata, Ranchi, Bangalore,  Gulbarga, Mysuru. The nation-wide campaign was conducted by the officials of DoPPW with the help of State Bank of India (SBI) & Punjab National Bank (PNB), who sponsored the campaign sites. The campaign saw the active participation of registered Central Government Pensioner Associations, the representatives of IPPB, UIDAI, NIC as well as CGDA in every city.

In order to overcome the challenge of certain pensioners not being able to give DLC due to fading bio-metrics the Department of Pension engaged with MeiTY to develop a face-recognition technology system based on Aadhaar database whereby it is possible to give LC from any Android based smart phone. As per this facility, the identity of a person is established through face recognition techniqueand DLC gets generated. This breakthrough technology, launched in November 2021, reduced the dependence of pensioners on external bio-metric devices and made the process more accessible and affordable to masses by leveraging smartphone-based technology.  This was a milestone achievement in ensuring ‘Ease of Living’ of the elderly. The Face Authentication Technology was launched in November 2021 after extensive pilot runs by by Dr. Jitendra Singh, the Union Minister of State (PP) of the Ministry of Personnel, Public Grievances and Pensions.

Based on the feedback received of the Face Authentication App developed for this purpose, NIC was quick to respond and incorporate the same. For example, the life certificate could be opened in the App after receiving an OTP and downloading the same. But because of feedback received from pensioners, the Life Certificate can be accessed immediately after entering the OTP. The State Bank of India officials at all locations came out in full strength to promote the campaign and their officials were seen enthusiastically participated even on holidays. Similarly, the participation by the Registered Pensioners’ Associations was exemplary and their representatives helped in spreading awareness about the Face Authentication technique of LC.

The campaign was widely appreciated by the pensioners residing in different parts of country. The campaign was widely covered by the newspapers and Doordarshan all over the country. During 1-30 November, 2022, Department of Pension & Pensioners’ Welfare has disseminated 532 tweets from its Twitter account during the period. Beside this other stakeholder of this campaign have re-tweeted 605 tweets during the period. Five videos were uploaded by the Department on its YouTube page. Two videos in Hindi and English have been uploaded on the official youtube channel of the department – DOPPW_INDIA OFFICIAL explaining the process of submitting the Life Certificate through Face Authentication Technique in simple language.

Submission of Life Certificates is an important activity to be carried out by pensioners every year in the month of November (with special provision for pensioners aged 80 years and above to submit their Life Certificates in the month of October) to ensure continuity of their pension. In the traditional mode, pensioners had to present themselves before the Pension Disbursing Authority for physical submission of their Life Certificate which entailed waiting at the bank branches in queues for this purpose. This was found inconvenient for the old, ailing and infirm pensioners. Further, there was no mechanism for the pensioners to get a status regarding updation of their Life Certificates in the records of the Pension Disbursing Authority.

To enhance ‘Ease of Living’ of Central Government pensioners, Department of Pension & Pensioners’ Welfare has been promoting Digital Life Certificate i.e. Jeevan Pramaan extensively. Initially submission of DLCs using biometrics was commenced. The Department roped in the 50 registered Pensioners’ Associations in different cities to promote DLCs. The Department further associated the Indian Post & Payment Bank (IPPB) to include DLC among one of the door-step services provided through the agency of its Gramin Dak Sevaks, numbering more than 1,90,000. Pension disbursing Banks were also asked to adopt the methodology of video based KYV method of Life Certification and a consortium of 12 Banks asked to provide door-step service for DLC. In order to prevent super senior pensioners aged 80 years and above, DoPPW issued orders permitting this age group to give their LC from October 1 itself in order to provide them an exclusive window and avoid rush at various pension disbursing bank branches. Indian Embassies/Consulates were advised to assist Pensioners living overseas who can now also give a DLC by receiving an OTP on their email.