Indian Finance Minister Nirmala Sitharaman, Key Announcements for statutory compliance amidst COVID-19 Pandemic

Indian Finance Minister Nirmala Sitharaman, Key Announcements for statutory compliance amidst COVID-19 Pandemic

Due to the COVID-19 outbreak, there are massive changes taking place in the country. There are various measures taken by the Ministry of Finance for the extension of statutory and regulatory compliances.  The Finance minister Nirmila Sitharaman announced the following measures –

Income Tax

  1. Income tax returns dates are extended for Financial Year 2018-19 from 31st March, 2020 to 30th June, 2020.
  2. Aadhaar card and PAN card linking date to be extended from 31st March, 2020 to 30th June, 2020.
  3. The scheme Vivad se Vishwas will have no additional 10% amount, if payment is made by June 30, 2020.
  4. All the due dates related to the issue of notice, notification, intimation, approval order, sanction order, filing of appeal, furnishing of return, statements, applications, reports, any other documents and also the time limit for the completion of any proceedings by the authority and any compliance by the taxpayer including investment in saving instruments or investments for roll over benefit of capital gains under Income Tax Act,  Wealth Tax Act, Prohibition of Benami Property Transaction Act, Black Money Act,  STT law, CTT Law, Equalization Levy law, Vivad Se Vishwas law where the time limit is expiring between 20th March 2020  to 29th June 2020 shall be extended to 30th June 2020.
  5. The payments delayed for the advance tax, self-assessment tax, regular tax, TDS, TCS, equalization levy, STT, CTT should be made between 20th March 2020 and 30th June 2020, and also, the interest rate is reduced to 9% from 12 %/18 % per annum (i.e. 0.75% per month instead of 1/1.5 percent per month) for this period. No late fee or penalty shall be charged for any kind of delay relating to this period.
  6. Necessary legal circulars and legislative amendments shall be issued for giving effect to the aforesaid relief.

GST/Indirect Tax-

  1. The last date for filing GSTR-3B in March, April and May 2020 will be extended till the last week of 30th June, 2020 for those having aggregate annual turnover less than Rs. 5 Crore. Also, no interest, late fee, and penalty to be charged.
  2. A reduced rate of interest @9 % per annum (current interest rate is 18 % per annum) will be charged for any delayed payment made between 20th March 2020 and 30th June 2020. Also, no late fee and penalty to be charged, if compiled before till 30th June 2020.
  3. The last date for opting for the composition scheme is extended till the last week of June, 2020. Further, the last date for making payments for the quarter ending 31st March, 2020 and filing of return for 2019-20 by the composition dealers will be extended till the last week of June, 2020.
  4. The date for filing the GST annual returns of FY 18-19, which is due on 31st March, 2020 is extended till the last week of June 2020.
  5. All the due date for issue of any notification, notice, approval order, sanction order, filing of appeal, furnishing of return, statements, applications, reports, any other documents, time limit for any compliance under the GST laws where the time limit is expiring between 20th March 2020 to 29th June 2020 shall be extended to 30th June 2020.
  6. With the prior approval of GST Council, the legislative amendments and necessary legal circulars to give effect to the aforesaid GST relief shall follow.
  7. Under Sabka Vishwas Scheme, the payment date shall be extended to 30th June, 2020. Also, no interest for this period shall be charged if paid by 30th June, 2020.

Customs- 

  1. Custom clearance will be 24*7, till end of 30th June, 2020
  2. All the due date for issue of notification, notice, approval order, sanction order, filing of appeal, furnishing applications, reports, any other documents etc., and the time limit for any compliance under the Customs Act and other allied Laws where the time limit is expiring between 20th March 2020 to 29th June 2020 shall be extended to 30th June 2020.

Financial Services- 

  1. 3 months relaxations for
  • All the debit cardholders to withdraw cash for free from any other banks’ ATM for 3 months
  • Waiver of minimum balance fee
  • Reduction in the bank charges for digital trade transactions for all trade finance consumers

Corporate Affairs – 

  1. For late filing during a moratorium period from 01st April to 30th September 2020, no additional fees shall be charged in respect of any document, return, statement etc.

They are required to be filed irrespective of its due date, in the MCA-21 Registry, that will not only reduce the compliance burden, including financial burden of companies/ LLPs at large but will also enable long-standing non-compliant companies/ LLPs to make a ‘fresh start’;

  1. The mandatory requirement regarding the holding of meetings of the Board of the companies within the prescribed interval provided in the Companies Act (120 days), 2013, shall be extended till the next two quarters (60 days) i.e., till 30th September.
  2. For the ease of the burden on companies & their auditors for the year 2019-20, applicability of Companies (Auditor’s Report) Order, 2020 shall be made applicable from the financial year 2020-2021 instead of from 2019-2020 notified earlier.
  3. Independent Directors are required to hold at least one meeting without the attendance of Non-independent directors and members of management, As per Schedule 4 of the Companies Act, 2013. If the IDs of a company have not been able to hold even one meeting in the year 2019-20, the same shall not be viewed as a violation.
  4. Any requirement required to create a Deposit reserve of 20% of deposits maturing during the financial year 2020-21 before 30th April 2020 shall be allowed to be complied with till 30th June 2020.
  5. Any requirement related to investing 15% of debentures maturing during a particular year in specified instruments before 30th April 2020, may be done so before 30th June 2020.
  6. All the newly incorporated companies are required to file a declaration for Commencement of Business within 6 months of incorporation. Also, an additional time of 6 more months shall be allowed.
  7. Non-compliance of the minimum residency in India for a period of at least 182 days by at least one director of every company, under Section 149 of the Companies Act, shall not be treated as a violation.
  8. It has been decided to raise the threshold of default under section 4 of the IBC 2016 to Rs 1 crore (from the existing threshold of Rs 1 lakh), because of the financial issues faced by most companies on account of the large-scale economic distress caused by COVID 19. This will at large prevent the triggering of insolvency proceedings against MSMEs. If this situation continues beyond 30th of April 2020, we may consider suspending section 7, 9 and 10 of the IBC 2016 for a period of 6 months, in order to stop companies at large from being forced into insolvency proceedings in such force majeure that are the causes of default.
  9. The Ministry of Corporate Affairs shall issue any detailed notifications/circulars in this regard separately.

Department of Commerce- 

A detailed notification will be issued by the Ministry of Commerce and they should give an extension of timelines for various compliance and procedures.

In case you face any problem or need any help in meeting the deadlines or statutory compliance, BFAG (Boston Financial Advisory Group) is there with you.

Contact us in case of any assistance or queries.

Contact us:

info@bostonfagroup.com  /  sales@bostonfagroup.com

Bangalore: +91 80 2572 4800

Pune: +91 7420061235

USA: +1 6099377291

Visit our website: www.bostonfagroup.com

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