Aino Management Consultancy

Pvt Ltd
Dear Professional Colleagues,

If the goals and actions set by you inspire others to dream more, learn more, achieve
more, you are a true leader. We all have remarkable ideas to take our business to the
highest level, it is only about executing the same to showcase to the outside world.
The desire to succeed in our respective fields is all what we need to move in the right
direction and achieve our Goals.

“Consistency is the key to success for any Venture” and therefore we, at AINO,
thrive to Provide Professional and Valuable Services Consistently which are of
Utmost Importance for our esteemed Client’s Business Growth. We are passionate
towards providing best services for our client’s businesses and in the ever-
changing competitive environment it is the result of our preparation and hard
work that makes us believe in ourselves and continue to help our clients with great
responsibility.

TH
We are delighted to bring you, our 110 edition of AINO Communique which
briefs about various amendments/circulars/clarifications in Goods and Service
Tax, Income Tax, RBI and Companies Act 2013.

We hope you find this Journal informative and of continued interest. We

welcome your feedback at Info1@ainoglobal.com

With warm regards

CA Sudheer Javali

1
 THE COMPENDIUM
A. Compliance Calendar – Dec 2022
B. Fluctuations summary
C. Statutory Updates
 Goods and Services Tax Act, 2017

 The Karnataka Labour Welfare Fund

Act,1965

 Income Tax Act, 1961

 RBI / FEMA

D. Companies Act, 2013 - Case Law

E. Tax Planning Tip
F. Knowledge Capsule

2
 A. Compliance Calendar – Dec 2022
Sl. No Particulars Date
Compliance Calendar for GST
1 GSTR 7 is a return to be filed by the persons who is required to deduct TDS 10-12-2022

2 GSTR-8 is a return to be filed by the e-commerce operators who are required to 10-12-2022
deduct TCS
3 GSTR-1 - Taxpayers having an aggregate turnover of more than Rs. 1.50 Crores or 11-12-2022
opted to file Monthly Return

4 GSTR-1 GST return for the taxpayers who opted for QRMP scheme 13-12-2022

5 Input Service Distributors 13-12-2022

6 GSTR-3B (Monthly) for Nov 2022 20-12-2022
7 GSTR -5&5A for Nov 2022 (Non-Resident Taxable person & OIDAR) 20-12-2022

8 GSTR-9- Annual Return for FY 2021-22 31-12-2022

9 GSTR-9C- Audit Return for FY 2021-22 31-12-2022
Compliance Calendar for PT, PF & ESI Payments
1 PF Payment for the month of Nov-22 15-12-2022
2 ESI Payment for the month of Nov-22 15-12-2022
3 Professional Tax Due date for the month of Nov-22 20-12-2022
4 Deduction with respect to Karnataka Labour Welfare Fund Act,1965 31-12-2022

Compliance Calendar for Income Tax Act

1 Payment of TDS/TCS deducted /collected in Nov 2022. 07-12-2022
2 Third instalment of advance tax for the assessment year 2023-24 15-12-2022
3 Furnishing of report in Form No. 3CEAD for a reporting accounting year 30-12-2022
4 Filing of belated/revised return of income for the assessment year 2022-23 for all 31-12-2022
assesses (provided assessment has not been completed before December 31, 2022)

Compliance Calendar for Companies Act

1 First AGM for FY 2021-22 31-12-2022

3
 Foreign Exchange Fluctuation

Currency As on 31st Oct 2022 As on 30th Nov 2022 Fluctuation

US 82.3934 81.5289

GBP 95.5351 98.6576

EURO 81.9232 84.8732

Stock Market Fluctuation

Stock
Exchange As on 31st Oct 2022 As on 30th Nov 2022 Fluctuation

BSE 56,788.81 62,895.07

Nifty 18,012.20 18,705.50

4
1. Goods and Services Tax Act, 2017
a. Circular No: 182/14/2022-GST - Guidelines for verifying the Transitional Credit in light of
the order of the Hon’ble Supreme Court in the Union of India vs. Filco Trade Centre Pvt. Ltd.,
SLP(C) No. 32709-32710/2018, order dated 22.07.2022 & 02.09.2022
https://cbic-gst.gov.in/pdf/Circular-182-14-2022-GST-10th-November-2022.pdf

b. Circular No: 181/13/2022-GST - Clarification on refund related issues

https://cbic-gst.gov.in/pdf/Circular-181-13-2022-GST-Clarification-refund-related-issues-
10112022.pdf

c. Guideline No: 04/2022-GST - Manner of processing and sanction of IGST refunds, withheld
in terms of clause (c) of sub-rule (4) of rule 96, transmitted to the jurisdictional GST authorities
under sub-rule (5A) of rule 96 of the CGST Rules, 2017. - reg.
https://cbic-gst.gov.in/pdf/Instruction-04-2022-GST.pdf

d. Notification No: 24/2022 - Central Tax dated 23.11.2022 - Seeks to make fourth amendment
(2022) to CGST Rules with effect from 01.12.2022
https://cbic-gst.gov.in/pdf/central-tax/NN-24-2022-English.pdf

e. Notification No: 23/2022 - Central Tax dated 23.11.2022 - Seeks to empower the Competition
Commission of India to handle anti-profiteering cases under CGST Act, 2017 with effect from
01.12.2022.
https://cbic-gst.gov.in/pdf/central-tax/NN-23-2022-English.pdf

2. The Karnataka Labour Welfare Fund Act,1965

This act provides for the constitution of a fund for financing and conducting activities to
promote welfare of labour in the State of Karnataka. Under the Act, the employee, employer,
and the State Government have to contribute at the rate of 6:12:6 respectively per employee
per annum. A separate board is constituted for this purpose under the Act with the members
of employers, employees, and state representatives.

FREQUENCY Yearly

DATE OF DEDUCTION 31st December

RETURNS 15th January

5
 Employee Employer Total
Contribution
₹ 20 ₹ 40 ₹ 60

RULES:

 Any Establishment/Employer employing 50 or more persons

 All employees who are employed for wages to do any work

skilled/unskilled/manual/clerical, in an establishment.

3. Income Tax Act, 1961

a. Co-browsing feature is now available for the taxpayer

What is Co-Browsing and how does it help Taxpayer service?

Co-browsing, also known as collaborative browsing, allows the Helpdesk agents to

collaborate with the taxpayer’s browser in real-time, just at the click of a button. Agents can
view and securely co navigate the Taxpayer’s browser screen and guide them interactively to
deliver real-time and personalized support.

Difference between Co-browsing and Screen Sharing.

Co-Browsing Screen Sharing

Co-browsing is a more convenient form of
visual engagement as it doesn’t require Both the agent and Taxpayer must install a
anyone to download any software. Agents 3rd party application like Zoom or Google
can quickly connect to the Taxpayer’s Meet before they can share their screens.
browsers with the click of a button.
Co-browsing provides a much more private
and secure experience for the Taxpayer as the Service reps can see the client’s entire desktop
agent can only view the active window of the or any notifications that may pop up.
Taxpayer’s browser and nothing else
The agent can execute specific actions on the
Agents can’t do any actions on the Taxpayer’s
client’s browser (like highlight, annotate,
screen and only provide oral instructions
click, fill out forms), helping Taxpayers by
during a screen sharing session.
quickly resolving their queries.
Most co-browsing software comes with a
Screen sharing doesn’t provide data masking,
feature called data masking that hides
allowing agents to see everything displayed
Taxpayers’ confidential data (like passwords)
on the Taxpayer’s screen.
during a co-browsing session.

https://www.incometax.gov.in/iec/foportal/help/all-topics/co-browser-
faqs

6
b. Filing of Form 10A for A.Y 2022-23 for regular registration/approval has been enabled on
the portal. For more information kindly refer the Circular No.22/2022
https://www.incometax.gov.in/iec/foportal/sites/default/files/2022-
11/Circular%20No.22%202022.pdf

c. Axis Bank, Central Bank of India, ICICI Bank and Indian Bank have been migrated
from OLTAS e-Payment of Taxes at Protean (previously NSDL) to e-Pay Tax facility
at the e-Filing portal for payment of taxes henceforth. Taxpayers are advised to use
Diductor’s TAN for making TDS/TCS payments.
https://www.incometax.gov.in/iec/foportal/sites/default/files/2022-
11/List%20of%20banks%20for%20tax%20payments.pdf

d. FAQs on Challan Status Inquiry (CSI) facility.

https://www.incometax.gov.in/iec/foportal/sites/default/files/2022-
11/Click%20Here.pdf

4. RBI / FEMA
a. Inclusion of Goods and Service Tax Network (GSTN) as a Financial Information Provider
under Account Aggregator Framework

With a view to facilitate cash flow-based lending to MSMEs, it has been decided to include
Goods and Services Tax Network (GSTN) as a Financial Information Provider (FIP) under the
Account Aggregator (AA) framework. Department of Revenue shall be the regulator of GSTN
for this specific purpose and Goods and Services Tax (GST) Returns, viz. Form GSTR-1 and
Form GSTR-3B, shall be the Financial Information.
https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12412&Mode=0

b. Basel III Framework on Liquidity Standards – Standing Deposit Facility

The overnight balances held by banks with RBI under SDF shall be eligible as ‘Level 1 High
Quality Liquid Assets (HQLA)’ for computation of LCR.

This circular is applicable to all Commercial Banks (excluding Local Area Banks, Regional
Rural Banks, and Payments Banks)

https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12413&Mode=0

7
 D. Companies Act, 2013 - Case Law

1. Consequences of using the designation as CEO by a director without being

appointed as CEO - a case study
M/s. Landomus Reality Ventures Private Limited, a subsidiary company of Landomus
Reality Ventures Inc., incorporated on 17th July 2015 having its registered office at No. 624, II
Floor, 15th Main, 24th Cross, BSK II Stage Bangalore in the State of Karnataka. The company
falls under the jurisdiction of the Registrar of Companies of Karnataka and the Registrar of
Company is situated at Bangalore.

Facts of the case

i. During the course of an enquiry under section 206 of the Companies Act 2013, the
inspecting personnel observed that in all the replies of the company written to the
regulatory authorities, one of the directors has signed in the capacity of chairman and
CEO (chief executive officer).
ii. However, no resolution has been passed for appointing him as a chief executive officer
(CEO) either by the company or by the board.
iii. As per the records available at the MCA portal, no form DIR-12 has been filed for any
change of designation, except for the initial appointment of director.
iv. Though the company does not fall under the classes of companies for appointing key
managerial personnel under section 203 of the Companies Act 2013, read with rules 8
& 8A of Companies (Appointment & Remuneration of Managerial Personnel) Rules
2014, the usage of the abbreviation CEO without proper approval of in the board /
shareholders that to without filing DIR-12 with Registrar of Companies to this effect is
in violation of section 170 (2) of the Companies Act, 2013.
v. After, bringing the notice of the above violation, the company has filed DIR-12 by
showing his appointment as chief executive officer, effective from 20th April 2021 and
made the offence good.

Summary of Personal Hearing

In response to the notice of personal hearing issued by the Registrar of Companies, the duly
authorized practicing company secretary attended the hearing on behalf of the company and
its directors on 8th October 2021. However, the hearing was rescheduled on 21st of October
2021 and thereafter the authorized representative attended the personal hearing on 21st
October 2021. During the hearing, the authorised practicing company secretary admitted the
violation committed by the company and its directors and also informed that the offences has
been made good by filing the required DIR-12 form for the change of designation.

The order passed by the Registrar of Companies / Adjudicating Officer

he Registrar of Companies / Adjudicating Officer, having considered the facts and
circumstances of the case and the submissions made by the authorized representative of the
company during the personal hearing admitting the violation, imposed penalty the penalty

8
 on company and its directors, in exercise of the powers vested under section 454 (3) of the
Companies Act 2013, as per the details below.

Penalty Imposed

Sl. No. Company / directors Penalty Rs.

1 Company 50,000
2 Director - CEO and officer in default 50,000
Total Penalty 1,00,000

Conclusion
From the above case law, it is very clear that the usage of chief executive officer designation
can only be used when the same is approved by the company / board for the above
designation when the director is appointed conferring the above designation. Any director
appointed in the company cannot use the designation as chief executive officer, which is
required to be duly approved by the company / board and after such appointment the
required form DIR-12 is also required to be filed for change in designation.

E. Tax Planning Tip

Purchase of Electronic vehicles:
To promote the use of Electric vehicles in India, the government has come up with section to
give tax relief to Electronic Vehicle buyers

An Individual who has taken a loan for purchase of E-Vehicle from any Financial Institution
and who has never owned an E-vehicle can avail such tax relief. Further, Interest to the extent
of Rs.1,50,000 payable on such loan would qualify for deduction under Section 80EEB.

Conditions to avail this deduction:

a. The Assesse should be an Individual (i.e., Deduction not available to any other
taxpayer),
b. Loan should be taken for purchase of an E-vehicle for personal use or business use.
(In case of business use any interest payment above Rs.1,50,000/- can be claimed as a
business expense. To claim as a business expense, it is necessary that vehicle should
be registered in the name of the owner or the business enterprise.)
c. Loan should be sanctioning during the period between 01.04.2019 and 31.03.2023,
d. Loan should be sanctioned by a Financial Institutions (i.e bank or specified NBFCs).

9
G. Knowledge Capsule

1. Requirement of Accounting Software having Audit Trail facility

The Ministry of Corporate Affairs (MCA) vide its notification dated 24.03.2021 brought a new
concept of “Audit Trail” by introducing a new proviso in Rule 3, sub-rule (1) of the Companies
(Accounts) Rule, 2014. Pursuant to the said rule w.e.f., 01st April 2023 now every company is
required to use accounting software for maintaining its books of account (i.e., companies
which maintain their books of account in electronic mode), which has a feature of recording
audit trail of each transaction.

Here, Audit Trail means a system that traces the detailed transactions relating to any item in
an accounting record and which comprise the features of recording trail of each transaction,
i.e., to create edit log of each change made in the books of account, capture the date details
when such changes are being made and such software to ensure that the edit trail cannot be
disabled.

The statutory auditor of the Company is also required to discuss the same in his report that
the company has used such accounting software for maintaining its books of account which
has a feature of recording audit trail and the same has been operated throughout the year
for all transactions recorded in the software and the audit trail feature has not been
tampered with and the audit trail has been preserved by the company as per the statutory
requirements for record retention.

2. Legal Entity Identifier (LEI): Purpose, Applicability and Compliances

RBI has made mandatory LEI registration for all cross-border transactions such as capital or
current account transactions of INR 50 crore and above, i.e. 1st October 2022.

Meaning
A LEI is a 20-character alpha numeric unique code recognised globally, allotted to any legal
entity or structure that is party to a financial transaction, who may act so, in the capacity of a
borrower, lender, market participant, financial and market regulator or a mutual fund /
Alternative Investment Fund (AIF) and its schemes, etc. in any jurisdiction across the globe.
The LEI connects key reference information for clear and unique identification of legal entities
within the global financial system.

Purpose
Since, LEI is accepted worldwide, it facilitates identification and tracking of the flow of
financial transaction right from the investment stage to its end use. It aims to identify and
evaluate systemic and emerging risk, identify trends, and take corrective steps in the global
financial scenario.
As an LEI contains information about an entity’s ownership structure including parent
company, the banks/public authorities can track all financial transactions against one LEI.
Also, some international public authorities rely on the LEI to evaluate risk, take corrective
steps and, if required, minimize market abuse, and improve the accuracy of financial data.

10
Compliances
Updating in case of change: An LEI code also needs to be updated in the event of any changes
to the information submitted at the time of registration or as appearing on the MCA records
or like governing authority.

Mandatory Renewal: An LEI code is valid for a period of 1 year from the date of registration
and has to be renewed for subsequent years. If not, the LEI status is set to ‘Lapsed’.

DISCLAIMER: The views expressed are strictly of the author and Aino Management
Consultancy Pvt Ltd. Information in this publication is intended to provide only a general
outline of the subjects covered. It should neither be regarded a comprehensive nor sufficient
for making decisions, nor should it be used in place of professional advice. Aino Management
Consultancy Pvt Ltd and its team accepts no responsibility for loss or damages arising from
any action taken or not taken by anyone using this publication.

We are encouraged by our readers and the complements received. In our

endeavour to improve our quality, we request you to spend your two minutes
time to give feedback.
Write to us at: Info1@ainoglobal.com

Thanking You,
Team AINO

11