Corporate Update : Direct Taxes: Blackmoney: SIT finds 122 names repeated in list; Less than half of HSBC bank accounts with no money The Special Investigation Team, SIT on black money has found that less than half of the HSBC bank list of over 600 accounts did not have any money while more than hundred names were a repeat, hampering the possibility of any action against them. Quoting Official sources, PTI reports that the Income Tax department is now mulling prosecution against 300 entities figuring in the list of 628 entries in the HSBC Geneva list given to the Supreme Court recently. The SIT found and reported that there was no amount shown in almost 289 HSBC Geneva entries, while 122 of them were repeated twice in the same list. Indirect Taxes: No service tax on food sold at air-conditioned restaurants: HC You wont have to pay extra tax for food and beverages you consume from either an air-conditioned restaurant or from an air-conditioned restaurant run alongside a bar. Bringing relief to customers, who otherwise wouldve had to pay 12.36% service tax on 40% of the total bill amount, a division bench of the Kerala high court said the Union governments decision to impose service tax on food and beverages served at such restaurants was not within the competence of Parliament. Upholding a single judge order, the division bench said: It cannot be said that it is an activity of service. When the said activity is deemed to be a sale of the food and other articles of human consumption by a constitutional definition, tax on the said activity can be imposed only by the state. The court said that the bill raised on the customer cannot be split as charged for the service part and as charged for the food part, though it may be part of the service that she renders by providing good furniture, furnishings, fixtures, linen, crockery and cutlery. Company Law: New depreciation regime: Clarity needed on transitional provisions, say Auditors The new depreciation regime is impacting corporate bottomlines in interesting ways this fiscal. While the new norms provide more flexibility to companies and are a step toward aligning with international practices, there is a need for more clarity on the transitional provisions, say audit experts. Under the earlier company law, the Government prescribed the depreciation rates. However, the new company law has moved to specifying only the ‘useful life of assets’, which are seen to be lower than earlier industry estimates, while giving the companies room to deviate. In late August, the Corporate Affairs Ministry clarified in Schedule II that the useful life of assets specified were indicative and not mandatory. This allowed companies to deviate from the ‘useful life’ norm. But, they needed to back this with technical certification. Unlike in India, globally, depreciation rates are not statutorily prescribed for companies. Depreciation is used to record the decrease in life of a company’s assets. For accounting purposes, depreciation reflects the extent to which an asset has been used. From a Profit & Loss perspective, a higher depreciation hits net profit. Economy & News: Top exchanges BSE and NSE to suspend trading in Kingfisher Airlines, UB Engineering In a major clampdown for non- compliance of Listing Agreement, top exchanges BSE and NSE today announced suspension of trading in shares ofKingfisher Airlines and another group firm, UB Engineering, from next month. Besides, the entire promoter shareholding of these companies have been frozen with effect from today itself. The action follows non-compliance to a Listing Agreement clause relating to timely preparation and disclosure of financial results by a listed company for two consecutive quarters. The results are required to be disclosed by listed companies on stock exchange platform for benefit of investors. In separate circulars, BSE and NSE said that the trading would be suspended in securities of Kingfisher and UB EngineeringBSE both parts of crisis-hit UB group headed by Vijay Mallya -- with effect from December. The suspension follows Sebi guidelines with respect to Standard Operating Procedure (SOP) for suspension and revocation of trading of shares of listed entities for noncompliance of the Listing Agreement that a listed company needs to follow pursuant to its shares getting listed and traded on a stock exchange
Posted on: Sun, 09 Nov 2014 14:35:10 +0000
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