AUGUST 2020

Goods and Service Tax

1. Functionality to file Revocation Application under Removal of Difficulty:

In view of the Removal of Difficulty Order No. 01/2020 dated 25.06.2020, the restriction on filing revocation application, in case it was rejected, has been removed. Aggrieved taxpayers can file an application for the revocation of the cancellation of registration once again.

Further, those taxpayers who have filed Appeal against rejection of the Revocation Application and the decision is still pending, they may also file the Revocation of Cancellation. The taxpayer is required to log in and navigates to Services> Registration> Application for Revocation to file the application for revocation.

2. As per an E-mail received from GSTN to some taxpayers: TAggregate turnover for the F/Year 19-20 will now be "Auto-Computed" by GST system based on the returns filed in Form GSTR-3B by all registrations on the common PAN which exceeds Rs. 5 Cr. The above turnover will be used for determining:

1. Due Date of Return Filing
2. Computation of Late Fee by the system and
3. Reporting Interest on delayed payments based on self-assessment basis

If any discrepancy is found in the turnover data, based on the auto- computation and the actual turnover, the taxpayer may file a grievance for redressal.

3. GSTR-4 Annual Return:

Form GSTR-4 (Annual Return) now available on GST portal, w.e.f. 1st April 2019, all Composition Taxpayers are required to file Form GSTR-4 on an annual basis for each financial year. The due date for filing FY 2019-20 Return is 31st August 2020

4. Clarification on issue of GST Rate on alcohol-based hand sanitizers:

The issue of GST rate on alcohol based hand sanitizers has been reported in few sections of media. It is stated that hand sanitizers attract GST at the rate of 18%. Sanitizers are disinfectants like soaps, anti-bacterial liquids, dettol etc which all attract duty standard rate of 18% under the GST regime. The GST rates on various items are decided by the GST Council where the Central Government and all the state governments together deliberate and take decisions. It is further clarified that inputs for manufacture of hand sanitizers are chemicals packing material, input services, which also attract a GST rate of 18%. Reducing the GST rate on sanitizers and other similar items would lead to an inverted duty structure and put the domestic manufacturers at disadvantage vis-a-vis importers. Lower GST rates help imports by making them cheaper. This is against the nation’s policy on Atmanirbhar Bharat. Consumers would also eventually not benefit from the lower GST rate if domestic manufacturing suffers on account of inverted duty structure.

5. Update on E-Invoice:

Seeks to amend Notification no. 13/2020-Central Tax in order to amend the class of registered persons for the purpose of e-invoice. E-Invoicing system shall apply to those taxpayers with annual turnover exceeding Rs 500 crore instead of Rs 100 crore. Special Economic Zones (SEZ) units shall also be exempted from issuing e-invoices.

Income Tax

1. More time to file ITR: In a relief to taxpayers, the government has extended the deadline to file income tax returns (ITR) for financial year 2019-20 to November 30. Extended the deadline for filing ITR for FY 2018-19 till 30th September 2020.

2. Verification of ITR-V forms for past five years: Income taxpayers who have not verified their ITR for assessment years 2015-16 to 2019-20 can now do the verification. The I-T department has offered a one-time measure for resolving the grievances of taxpayers associated with non-filing of ITR-V (Income Tax Return Verification) for earlier assessment years. ITR-V is a one-page verification document you must submit to the I-T department for them to start processing your return. Taxpayers can sign ITR-V and send it to I-T department’s centralised processing centre (CPC) in Bengaluru or verify through EVC/OTP by September 30. These returns will be processed by December 31.

3. ITR 1, 2, 3 & 4 for AY 2020-21 is available for e-Filing. Other ITRs will be available shortly

FEMA & Companies Act

1. RBI empowered to administer FDI rules: The present amendment gives a restrictive power to RBI to issue directions, circulars, instructions, clarifications, as it may deem necessary, for effective implementation of the provisions of these rules. Emphasizing on the words ‘for effective implementation of the provisions of these rules’, it is clear only actions that would facilitate and aid in effective implementation of the rules would be within the ambit of RBI’s authority. Thus, RBI is allowed to issue such circulars and clarifications that would supplement the FEMA (Non-Debt instruments) Rules, 2019 by CG i.e. Ministry of Finance. The provision in no way takes away the mighty power to make rules that are within the scope of the CG i.e. the Ministry of Finance only.

2. SEBI extends deadline for June quarter results amid COVID-19: Since, the first quarter of the FY 2020-21 has come to an end, companies are expected to finalize, approve and submit their financials to the respective stock exchange(s) within 45 days from the quarter ended June 30, 2020 as per Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 (‘Listing Regulations’) i.e. on or before August 14, 2020.

Considering the shortened time gap of 14 days between the two due dates stated above i.e. July 31 and August 14, SEBI vide its circular[2] dated July 29, 2020, has extended the deadline to submit financial results for the first quarter from August 14 to September 15, 2020 thereby allowing additional 32 days to the listed companies which will in turn provide extra time to companies and its auditors working on reporting the quarterly financial results.

It is pertinent to note here that the board of directors, as per Regulation 17(2) of the Listing Regulations, must meet at least four times a year, with a maximum time gap of 120 days between any two meetings. In this regard, the SEBI vide circular[3] date June 26, 2020 had exempted the listed entities from observing the stipulated time gap between two board meetings for the meetings held/proposed to be held between the period December 01, 2019 and July 31, 2020.

Considering no further extension has been granted by SEBI yet, the board meeting for approving the financial results should be scheduled keeping in mind the maximum time gap of 120 days prescribed under the Listing Regulations. For example, if we take a case of a listed company which held its last board meeting on May 02, 2020, the next board meeting shall be scheduled on or before August 31, 2020 instead of the extended due date of September 14, 2020.

As regards for unlisted companies, the maximum time gap for conducting board meetings had been relaxed vide MCA circular dated March 24, 2020 to 180 days from present 120 days for the first two quarters of FY 2020-2021.

PAYMENT AND SETTLEMENT SYSTEMS IN INDIA- VISION 2021

In this Article we will try and understand about the Payment and Settlement Mechanism currently in India, what and who governs them and what is the future expected to be. Payment and Settlement systems are the backbone of any economy. The efficiency of such systems has a great role in making an economy less-cash.

What and who governs the Payment and Settlement Mechanism of India?

Payment and Settlement Act 2007 empowers the Reserve Bank of India to govern and ensure that India has state-of-the-art payment and settlement system that are not just safe and secure, but are also efficient, fast and affordable.

Understanding the Basic Terms

NEFT: National Electronic Funds Transfer is a Nation-wide payment system that facilitates one-to-one funds transfer. Under this scheme, payments can be made electronically from one bank branch to any other bank branch in the country. The clearance of NEFT happens in Batches and the payment hits the beneficiary’s account when the respective Batch clearance happens.

RTGS:Real Time Gross Settlement Mechanism is a fund transfer system which allows for instantaneous transfer of money. The beneficiary of the payment receives money instantly when the funds are transferred from any bank in India by the sender.

IMPS: Immediate Payment Transfer is an instant electronic fund transfer service. It offers an instant 24*7 interbank electronic fund transfer capable of processing person to person, person to account and person to merchant remittances via mobile, internet and ATMs. The main advantage of IMPS is its available even after the banking hours unlike NEFT and RTGS. But there are limits to the amounts that can be transferred by way of IMPS during a day. NEFT has been made 24*7 recently.

UPI: United Payments Interface is a system that powers multiple bank accounts into a single application, merging several banking features, seamless fund routing and merchant payments into one hood.

A LOOK AT ACHIEVEMENTS OF 2015-2018 VISION OF RBI ON PAYMENT AND SETTLEMENT SYSTEMS

QUANTITIVE ACHIEVEMENTS

PAYMENTS SYSTEM VISION OF RBI-2021

RBI aims towards:

• Enhancing Customer Experience
• Empowering Payment System Operators and Service Providers
• Enabling appropriate infrastructure
• Putting In place forward looking regulation
• Bringing about Risk-focused Supervision.

RBI in order to achieve the above vision, envisages a four-point approach of 4 Cs- Competition, Cost, Convenience and Confidence.

TReDS- Trade Receivables Discounting System:

TreDS was envisaged for resolving the liquidity crunch faced by MSMEs by facilitating the financing of trade receivables from Corporates and other buyers, including government departments and Public Sector Undertakings through multiple financiers. RBI has issued license to three players: RXIL (Receivables Exchange of India), Invoicemart and M1Xchange.TReDS platform has been growing tremendously, one of the distinguishing features being the MSMEs are not required to give any collateral at attractive interest rates.

OFFLINE PAYMENT SETTLEMENT SYSTEM:

The RBI in its statement of Development and Regulatory Policies issued on August 6 announced that on account of lack of internet connectivity or low speed of internet, especially in remote areas which is acting as an impediment in adoption of digital payments, providing an offline payment facility through cards, wallets, mobile devices is essential. RBI has been encouraging entities to develop offline payment solutions.

CONCLUSION:

RBI is trying to bring in all kinds of improvements, enhancements and regulations to achieve the Vision 2021 of Payment and Settlement Mechanism. India is going to witness an efficient, un-interrupted availability of safe, secure, accessible and affordable payment system to serve segments of the population which are hitherto untouched by the payment systems. The decade to follow will witness a revolutionary shift in the way Indian citizens use digital payment options that will be exceptionally safe, secure and truly world class.

CONSUMER PROTECTION (E-COMMERCE) RULES, 2020

Ministry of Consumer affairs, Food and Public Distribution vide powers empowered to it in Consumer Protection Act, 2019 (CPA) has rolled out a new rule called Consumer Protection (E-commerce) Rules, 2020 (CPER) to regulate E-Commerce entities offering goods and services to Indian Consumers.

Applicability

These rules are applicable to:

• All goods and services traded over digital or electronic network including digital products.
• All models of e-commerce, including marketplace or inventory models of e-commerce.
• All e-commerce retail including multi-channel single brand retailers and single brand retailers in single or multiple formats.

These rules will not be applicable to an activity carried out by a natural person in a personal capacity and not for any professional or commercial activities.

Duties of an E-Commerce entity:

1. An E-Commerce entity shall be a company incorporated under the Companies Act or a foreign company or an office, branch or an agency outside India owned or controlled by person resident in India and the E-commerce entity shall appoint a nodal person of contact or an alternate senior designated fiduciary who is a resident in India to ensure compliance of these provisions.

2. The entity should provide the following on their e-commerce platform:

• The legal name the entity;
• Principal geographic address of its headquarters and all branches;
• Name and details of its website; and
• Contact details, including mobile numbers of customer care and grievance officer to help the users make an informed decision.

3. The entity must ensure to put up a grievance redressal mechanism along with

• A Grievance officer, and
  1. a. Display the name,
  2. b.Contact details, and
  3. c.Designation of such officer on the e-commerce platform.
• 4. The entity also has to ensure that the aforementioned grievance officer
  1. a.acknowledges the complaint of consumer within 48 hours and
  2. b.acts on the complaint with 1 month from the date of receipt of the complaint.
• 5. In case the entity offers imported goods or services for sale, it must provide
  1. a. the name and details of such importer or
  2. b. who may be a seller on its platform.

6. No e-commerce entity shall impose cancellation charges on consumers cancelling after confirming purchase unless similar charges are also borne by the e- commerce entity, if they cancel the purchase order unilaterally for any reason.

7. The entity should record only the explicit consent of the consumers for the purpose of purchase of any goods or services offered on the platform. Pre-ticked checkboxes do not confirm the consent of the consumer.

8. The refund requests of the consumers should be processed within a reasonable time period as mandated by the RBI or prescribed under applicable laws.

9. The manipulation of price is strictly prohibited. The goods or services which are being offered on the platform should be priced reasonably.

Duties of a Marketplace E-Commerce Entity

• Every marketplace e-commerce entity to ensure compliance with the relevant sub-section(s) of Section 79 of the Information Technology Act, 2000.
• Every entity shall require from sellers through an undertaking to ensure that the descriptions, images and other information pertaining to goods or services on the platform is strictly accurate.
• Entity should provide details about the sellers, including the name of their business, whether registered or not, geographic address, customer care numbers, any rating, or feedback on the platform in a clear and accessible manner to help the consumers make informed decisions.
• Entity to provide ticket number for each complaint for consumers to help track the status of their complaint, information pertaining to refund, return, exchange, warranty & guarantee, delivery and shipment, modes of payment, grievance redressal mechanism, and any other information required by consumers to make informed decisions.
• Every marketplace e-commerce entity shall include in its terms and conditions generally governing its relationship with sellers on its platform, a description of any differentiated treatment which it gives or might give between goods or services or sellers of the same category.
• Every marketplace e-commerce entity shall take reasonable efforts to maintain a record of relevant information allowing for the identification of all sellers who have repeatedly offered goods or services that have previously been removed or access to which has previously been disabled under the Copyright Act, 1957 (14 of 1957), the Trade Marks Act, 1999 (47 of 1999) or the Information Technology Act, 2000 (21 of 2000)

Duties of Sellers on the Marketplace

• No seller offering goods or services through a marketplace e-commerce entity shall adopt any unfair trade practice whether in the course of the offer on the e-commerce entity’s platform or otherwise.
• Sellers shall not falsely represent himself as a customer and post reviews about goods or services or misrepresent the quality or the features of any goods or services.
• Sellers shall not refuse to take back goods, or withdraw or discontinue services purchased or agreed to be purchased, or refuse to refund paid amount, if goods or services are defective, deficient or spurious, or do not conform to the advertised features, or agreed delivery schedule.
• Sellers shall have prior written contracts with the respective marketplace e- commerce entity in order to sell their goods or services.
• Sellers shall appoint a grievance officer for redressal of consumer's complaint and ensure that the officer acknowledges the complaint within 48 hours of the receipt of the complaint and acts upon it within 1 month from the date of receipt of the complaint.
• The advertisements of the goods or services offered shall be consistent with the actual characteristics of such goods or services.
• The seller should provide to the E commerce entity, the seller’s legal name, geographic address of headquarters and all branches, the name and details of website, contact details, including customer care number, and applicable GSTIN and PAN details to the marketplace e-commerce entity.
• The seller shall disclose and display through the marketplace e-commerce entity all contractual information, total price of the goods or services along with breakup, postage & handling charges, conveyance charges, and applicable taxes.
• The seller has to disclose all the mandatory notices, relevant details about the goods or services, including country of origin and expiry date of the goods or services, accurate information related to terms of exchange, returns, and refunds, including cost of return shipping, and any relevant guarantees or warranties applicable on the goods or services.

Duties of Inventory E-Commerce Entity

1. An inventory e-commerce entity, also need to comply with the mandate given for sellers on marketplace e-commerce entity as discussed above.

GST Overview & Analysis of Input tax credit provisions – Section 16 of CGST Act 2017

GST was implemented with the main purpose to remove cascading effect of tax by facilitating seamless flow of Input Tax Credit.

Section 16 (1) of the CGST Act, provides that every registered person shall, subject to such conditions, restrictions and in the manner specified in Section 49 of the CGST Act, be entitled to take credit of input tax charged on any supply of goods or services or both to him which are used or intended to be used in the course or furtherance of his business and the said amount shall be credited to the electronic credit ledger of such person.

Section 16(2) of the CGST Act, prescribes the eligibility conditions for taking input tax credit and once the registered person satisfy the four conditions specified therein, he is entitled to take credit in the electronic credit ledger in respect of supply of goods or services or both.

The four conditions as prescribed under section 16(2) are:

• he is in possession of a tax invoice or debit note issued by a supplier registered under this Act, or such other tax paying documents as may be prescribed;
• he has received the goods or services or both Explanation.- For the purposes of this clause, it shall be deemed that the registered person has received the goods where the goods are delivered by the supplier to a recipient or any other person on the direction of such registered person, whether acting as an agent or otherwise, before or during movement of goods, either by way of transfer of documents of title to goods or otherwise;
• subject to the provisions of section 41, the tax charged in respect of such supply has been actually paid to the Government, either in cash or through utilization of input tax credit admissible in respect of the said supply; and
• he has furnished the return under section 39:

Where the registered person receives the goods against an invoice in lots or installments, then credit shall be available on receipt of last lot or installment.

Where a recipient fails to pay to the supplier of goods or services or both, other than the supplies on which tax is payable on reverse charge basis, the amount towards the value of supply along with tax payable thereon within a period of one hundred and eighty days from the date of issue of invoice by the supplier, an amount equal to the input tax credit availed by the recipient shall be added to his output tax liability, along with interest thereon.

Section 16(3) provides that the registered person who has claimed depreciation on the tax component of the cost of capital goods and plant and machinery under the provisions of the Income-tax Act, 1961, shall not be entitled to the input tax credit on the said tax component.

Section 16(4) prescribes the time limit for taking Input Tax Credit.

A registered person shall not be entitled to take input tax credit in respect of any invoice or debit note for supply of goods or services or both after the due date of furnishing of the return under section 39 for the month of September following the end of financial year to which such invoice or invoice relating to such debit note pertains or furnishing of the relevant annual return, whichever is earlier.

The cited provision of section 16(4) prescribes that a registered person cannot take Input Tax Credit in respect of invoice or a debit note pertaining to a financial year after the due date for furnishing the return under section 39 for the month of September from the end of financial year or furnishing of Annual return, whichever is earlier. It is pertinent to mention that the restriction under section 16(4) originally linked to GSTR-3, but the said return was kept in abeyance by the Government and return now means GSTR-3B as per amendment made to Rule 61(5). Thus, for the financial year 2017-18 last date of taking credit against invoices or debit notes was 20’th October,2018 i.e. filing of GSTR-3B return for the month of September,2018.

It was only due to GSTN glitches that a shorter return in FORM GSTR-3B was introduced temporarily by amending Rules. It was not introduced in lieu of GSTR-3, filing of which has only been kept in abeyance till further orders. It is submitted that para 3 of the press release dated 18th October, 2018 says that, “With taxpayers self-assessing and availing ITC through return in FORM GSTR-3B, the last date for availing ITC in relation to the said invoices issued by the corresponding supplier(s) during the period from July, 2017 to March, 2018 is the last date for the filing of such return for the month of September, 2018 i.e. 20th October, 2018”. Thus, GSTR-3B as summary report is for the purpose of payment of tax and for availing ITC.

But there was dispute about GSTR-3B is not a return under section 39. Let us now see a judgement which provoked the amendment in Rule 61(5) by way of CGST (Sixth Amendment) Rules, 2019 notified vide Notification No. 49/2019- Central Tax, dated 09-10-2019. The Hon’ble Gujarat High Court in the case of AAP & Co., Chartered Accountants Vs. Union of India reported in 2019 (26) G.S.T.L. 481 (Guj.), held that “It would be apposite to state that initially it was decided to have three returns in a month, i.e. return for outward supplies i.e. GSTR-1 in terms of Section 37, return for inward supplies in terms of Section 38, i.e. GSTR-2 and a combined return in Form GSTR-3.

However, considering technical glitches in the GSTN portal as well as difficulty faced by the taxpayers it was decided to keep filing of GSTR-2 and GSTR-3 in abeyance. Therefore, in order to ease the burden of the taxpayer for some time, it was decided in the 18th GST Council meeting to allow filing of a shorter return in Form GSTR-3B for initial period. It was not introduced as a return in lieu of return required to be filed in Form GSTR-3. The return in Form GSTR-3B is only a temporary stop gap arrangement till due date of filing the return in Form GSTR-3 is notified. Notifications are being issued from time to time extending the due date of filing of the return in

Form GST- 3, i.e. return required to be filed under Section 39 of the CGST Act. It was notified vide Notification No. 44/2018-Central Tax, dated 10th September, 2018 that the due date of filing the return under Section 39 of the Act, for the months of July, 2017 to March, 2019 shall be subsequently notified in the Official Gazette. Further it was held that clarification could be said to be contrary to Section 16(4) of the CGST Act read with Section 39(1) of the CGST Act read with Rule 61 of the CGST Rules.”

In the case of Eicher Motors Ltd. v. Union of India- 1999(106) E.L.T.3 (S.C.), the Supreme Court held that the very purpose of credit is to give benefit to the assessee and a right accrued to the assessee on the date when they paid the tax on the raw materials or the inputs should be available to the taxpayers. Therefore, it is pertinent to mention that by this restriction of time- limit under section 16(4), the vested right of ITC cannot be taken away from the taxpayer. Further reference to the Article 300A of the Constitution can be made wherein it is mentioned that no person shall be deprived of his property save by the authority of law. Section 41 prescribes that every registered person, shall subject to such conditions and restrictions as may be prescribed, be entitled to take credit eligible input tax, as self-assessed, in his return and such amount shall be credited on a provisional basis to his electronic credit ledger and the registered person shall be utilized only for payment of self-assessed output tax. Therefore, ITC is a property or cash in hand and said property cannot be denied by way of not allowing the credit merely due to time-related procedural limitations. Summary of Conclusions

To summarize, Section 16(1) provides that a registered person is “entitled to take” credit of the tax paid on any supply of goods or services or both which are used or intended to be used in the course or furtherance of business and the said amount of ITC shall be credited to the electronic credit ledger of the registered person.

Section 16(2) prescribes that a registered person has to satisfy four eligibility conditions for taking input tax credit (such as possession of duty paying documents under Rule 36(1), receipt of goods or services, tax paid by the supplier to the Government and return furnished by the registered person under section 39 i.e. GSTR-3B) and once the registered person satisfy the said conditions, he is entitled to take credit in the electronic credit ledger in respect of supply of goods or services or both. Since the section 16(2) starts with a Non abstain clause, Section 16(2) overrides Section 16(4). Thus, in the absence of time limit as one of the conditions in Section 16(2) ITC should be available to registered person even beyond time limit. With regard to non-furnishing of details of invoices / debit notes after due date furnishing of returns under Section 39 for the month of September from the end of financial year to which invoices pertains is the only procedural lapses, for which a registered person should not be denied substantial benefit, hence ITC should be available even if the same is claimed beyond the stipulated limit prescribed under Section 16(4) of the CGST Act, 2017.

The opinions in this article are purely of the author and shall not be relied upon for availment of ITC by any particular Individual or entity. We do not accept any responsibility for loss incurred by any person for acting or refraining to act as a result of any matter in this publication.

Tax Audit Applicability

The Finance Act 2020 has made some major changes in tax audit provision leading to changes in threshold limit. Tax audit is governed by section 44AB of the Income tax act. As per section 44AB a person is required to conduct compulsory audit of books of accounts if the turnover or gross receipts of business or profession crosses the threshold limit.

In this article we are going to discuss about the various changes made by the Finance Act 2020 under section 44AB applicable for Financial Year 2019-20, Assessment Year 2020-21 and Financial Year 20-21, Assessment Year 2021-22. As per section 44AB, following persons are compulsorily required to get their accounts audited:

• A person carrying on business, if his total sales, turnover or gross receipts (as the case may be) in business for the year exceed or exceeds Rs. 1 crore. This provision is not applicable to the person, who opts for presumptive taxation scheme under section 44AD and his total sales or turnover doesn’t exceed Rs. 2 crores.
  
  Note: w.e.f. Assessment Year 2020-21, the threshold limit, for a person carrying on business, is increased from Rs. 1 Crore to Rs. 5 crores in case when cash receipt and payment made during the year does not exceed 5% of total receipt or payment, as the case may be. In other words, more than 95% of the business transactions should be done through banking channels.
• In case the person is carrying on profession than he shall be liable for tax audit if his gross receipts in profession exceed Rs. 50 lakh in any previous year.
• Where the person is carrying on the business shall and is opting for presumptive taxation scheme under the following provisionsand assesse has claimed income lower than the deemed profits to be required to show under the head profits and gains of business, as the case may be, in any previous year then he is liable for tax audit.:
  1. Section 44AD: Presumptive taxation in case of business
  2. Section 44ADA: Presumptive taxation in case of Profession
  3. Section 44AE: Presumptive taxation in case of business of plying, hiring or leasing goods carriages
  4. Section 44BB: Presumptive taxation in case of shipping business in case of non-residents
  5. Section 4BBB: Presumptive taxation in case of business of exploration of mineral oil etc.
• Where person is carrying on the business shall, and the provisions of sub-section (4) of section 44AD are applicable in his case and his income exceeds the basic threshold limit which is not chargeable to income-tax in any previous year then he is liable for tax audit.

The Following is a pictorial representation of the above newly inserted provision: In case of person engaged in business and opting for presumptive taxation under section 44AD:

In case of person engaged in business and opting for presumptive taxation under section 44ADA:

Turnover limit for the previous year	Amount of profit with respect to turnover (in %)	Is audit Applicable?
More than 50 Lakhs	Not applicable	Yes 44AB(b)
Upto 50 Lakhs	More than 50%	No
Upto 50 Lakhs	less than 50% (sec 44ADA)	Yes 44AB(d)

• If total income exceeds basic exemption limit only then tax audit is applicable.
• Where the assesse is covered under section 44AB then he is required to get the books of accounts audited by a Chartered Accountant.
• The tax audit report should be furnished in form 3CA/3CB & 3CD, where the report of the tax audit conducted by the chartered accountant is to be furnished in Form No. 3CB and the details of audit are to be reported in Form No. 3CD.
• The due date of tax audit is 30th September of the Assessment year. Due to Covid-19 situation in the country, the government through press conference dated May 13, 2020 announced that the tax audit report due date has been extended from September 30, 2020 to October 31, 2020.
• In case the assesse is liable for tax audit and he fails to conduct audit of books of accounts than he is liable for a penalty of lower of the below two:
  • 0.5% of the turnover or gross receipts, or
  • Rs. 1,50,000.