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Society News

57TH EDITION OF ‘BCAS REFERENCER’ RELEASED

The BCAS Referencer, one of the eagerly-awaited, landmark publications of the Bombay Chartered Accountants Society, entered its 57th year of continuous publication this year – and also the 22nd year of theme-based issues.

The release programme was organised at the M.C. Ghia Hall on 2nd August, 2019 by the Seminar, Public Relations & Membership Development (SPR&MD) Committee. Following the lighting of the auspicious lamp, there was a selection of short glimpses of India’s classical dance forms which is the theme of this year’s Referencer.

CA Toral Mehta compered the event and introduced the chief guests of the evening, Mr. Sameer and Ms Arsh Tanna, eminent Bollywood choreographers, and the sponsor, CA Kamal Poddar of Choice Connect.

BCAS President CA Manish Sampat noted in his remarks that the publication, which is recognised as the most dependable knowledge resource and an unparalleled repository of various laws, had been the hallmark of BCAS for the last six decades. He acknowledged all the contributors, specially the youth, and the tremendous efforts put in by the Committee for the release of the Referencer immediately after the Union Budget.

The various Indian classical dance forms – whether Bharat Natyam, Odissi, Kucchipudi, Kathakali, Kathak or Manipuri – were performed by the artists who were actually the members and students of the BCAS. They were led by CA Manori Shah under the choreography of Nita Shah and Vishrut Doshi. Other artists who performed included Chirag Bohra, Jitesh Kakad, Hrudyesh Pankhania, Rishikesh Joshi, Vidisha Shah, Disha Unadkat, Tanvi Parekh, Kinjal Bhuta, Rishita Shah, Richa Agrawal and Vidhi Parekh. The rapt audience appreciated and enjoyed all the dances.

In his address, Committee Chairman CA Narayan Pasari appreciated the efforts of all the contributors, editors, proof-readers, and specially CA Pranay Marfatia who had been instrumental in the publication of the Referencer for several years and for organising the release event. The Referencer was released in the presence of a galaxy of personalities, including the contributors, editors and others and was unveiled by the chief guests.

Chief guest Ms Arsh Tanna said she was amazed by the performances of the artists of the BCAS fraternity and expressed her delight at attending the event which was brilliantly correlated with the theme – Indian classical dance and the contents of the Referencer.

Convener CA Manmohan Sharma proposed a hearty vote of thanks to all present, especially to Choice Connect, the sponsors of the Referencer, Finesse, the printers, the BCAS Events staff and the organising team of the Committee who had put in a lot of hard work.

SUBURBAN STUDY CIRCLE

The Suburban Study Circle organised two meetings on ‘15CB Certification – Who, What, When and How?’, on 16th July and 13th August, 2019, which were addressed by CA Rutvik Sanghvi who made a detailed presentation on the following Rules and Regulations:

(i) Who all are covered under the provisions of section 195?
(ii) What transactions are covered?
(iii) When is the taxation to a non-resident applicable?
(iv) How is it to be applied?

Rutvik explained the nuisances and complexities involved in payments to non-residents in a lucid manner. He explained the importance and requirement of tax residency certificate and taxability of various kinds of payments to non-residents like fees for technical services, royalty, etc. It required two sessions to cover the topic in detail.

The participants benefited from the presentation made by him.

HRD STUDY CIRCLE

The HRD Study Circle met on 13th August, 2019 to discuss ‘Modern Techniques in Physiotherapy.’

The presentation was made by Dr. Rupa Mehta and Dr. Kritika Poddar. Dr. Rupa Mehta and her team run Healthspace clinic at Opera House and have 30 years of experience. They have kept themselves updated with the latest techniques in physiotherapy.

The presentation covered:
(a) Diagnosis and treatment of spine (neck and back), shoulder, elbow, hip, knee and ankle joint pains. (Through her presentation, Dr. Rupa Mehta gave members a detailed explanation for the possible reasons for pain in the joints. She showed simple exercises to address the pain in the initial stages and explained that neglecting it can cause further damage and addressing it early can help avoid surgery);
(b) Bad posture can have a deleterious effect on the body;
(c) It is necessary to improve the core muscles.

The latest techniques used in Healthspace are as follows:
(I) The McKenzie Protocol of exercises
(II) The Mulligan Protocol
(III) Neurodynamic solutions
(IV) Taping
(V) Dry needling
(VI) Core muscle strengthening
(VII) Pilates on the reformer and customised exercise.

Dr. Kritika Poddar highlighted the benefits of pilates. She projected ergonomics with visual inputs and stressed on the need for the right posture. Work life ergonomics and exercises shown by her could be beneficial for all chartered accountants and professionals.

However, the most important point was to spread awareness so that people do not injure themselves and adopt a better lifestyle.

INTERNATIONAL ECONOMICS STUDY GROUP

The group held its meeting on 16th August, 2019 to discuss ‘Economic Slowdown and Global Flash Points’. CA Harshad Shah led the discussions and presented his thoughts on the subject.

He said that based on the definition of slowdown and recession, the Indian economy had slowed down and might have entered into a recessionary phase as the GDP had come down from the high of 8.2% in Q1 FY19 to 7.2% in Q2 and in the last quarter dropped to 5.8%. This fulfilled the technical definition of a recession of two consecutive quarters of negative economic growth.

At the macro level, the automobile sector was facing its worst crisis in 20 years with the malaise spreading across much of the industry, both in terms of vehicle type and components as well as geographically in the country’s manufacturing hubs, along with the structural reform of pushing for electric vehicles. The real estate sector had been on a downturn since the demonetisation period, with India’s top 30 cities having 1.28 million unsold housing units as of March, 2019. The health of real estate was a major indicator of the state of the economy. It had links with about 250 ancillary industries – bricks, cement, steel, furniture, electrical products, paints, etc., and affected all of them whether there was a boom or gloom in the sector.

FMCG companies had reported a decline in volume growth due to sluggish rural demand which, in turn, indicated less availability of money in villages. All these factors impacted the unemployment rate which had risen to a 45-year high.

India’s household-sector savings, the biggest source of investment for the economy, had ‘worryingly’ come down to 30.5% (as % to GDP) in 2018 compared to nearly 37% in 2008. Poor savings had been a largely ‘unaddressed’ reason for the country’s continuing slowdown. Retail loans to the sector were growing annually in double digits, pointing to profligate consumption by households with a youthful population (70% of the working-age population being aged between 20 and 40 years) that liked to spend. Many economists widely held that a country’s economic growth should be investment-led rather than being driven by consumption, as had been the case with India.

The NITI Aayog CEO attributed the downshift to a spate of measures (structural reforms) such as GST, RERA and IBC that had led to the current slowdown in the country.

The global economy was bracing for a probable recession in 2020 as nearly half (48%) of CFOs in USA and some prominent economists were also predicting this. One of the indicators, the Yield Curve inversion, had already occurred. An inverted yield curve meant that interest rates had flipped on the US. Treasury with short-term bonds paying more than long-term bonds. This was generally regarded as a warning sign for the economy and the markets.

The global economy was also facing some serious headwinds such as Hard Brexit; US vs. China: From Tariff War to Currency War to Economic War, with USA labelling China as a ‘Currency Manipulator’ for the first time; Argentina’s historic market crash with fears of another default; the Hong Kong protests and probable retaliation by Chinese security forces; and the Iran issue. CA Milan Sanghani and many participants expressed their views on all these issues.

FEMA STUDY CIRCLE

The FEMA Study Circle meeting held on 19th August, 2019 covered the issue of ‘FDI in Trading Sector’.

CA Chintan Shah delved into various facets of the subject, viz., Cash and Carry Wholesale Trading, E-commerce, Single Brand Product Retail Trading, Multi-Brand Product Retail Trading and Duty-Free Shops. The FDI in the above activities was covered from scratch, beginning with sectoral caps applicable to each of them and ending with a healthy discussion on understanding the nuances of their respective definitions, the conditions attached thereto and understanding the manner in which businesses were structured in India. It was indeed a very interesting session given the current business environment in the country in which various multinational companies across the globe were exploring business models to expand their markets here.

4TH NARAYAN VARMA LECTURE

The 4th Narayan Varma Memorial Lecture (and the Narayan Varma Memorial Awards) was organised by the Public Concern for Governance Trust, the Bombay Chartered Accountants Society, the Dharma Bharathi Mission and the Chamber of Tax Consultants at the Indian Merchants Chamber on 23rd August, 2019.

The programme was organised in memory of Narayan Bhai who was closely associated with these organisations, held various posts in them and mentored and nurtured them with his values, ideology and hard work. He left behind an enduring legacy as a great professional, a philanthropist and, above all, a great human being.

The memorial lecture was delivered by Mr. Y.H. Malegam, the well-known CA and a legend in the financial sector who has been honoured with the Padma Shri.

Three distinguished persons from Mumbai were also recognised for their humanitarian service. The DBM NV Memorial Award was given to the Adhyayan Sanstha, the BCAS Narayan Varma Memorial Award went to Mr. Vishwas Gore and the PCGT NV Memorial Award was bestowed on Mr. Shailesh Gandhi.

The programme was very well attended with all top CAs, auditors and people associated with the social sector in attendance. Kudos to all the four other partner organisations for coordinating their efforts to organise the memorable event.

TAXATION COMMITTEE

The Taxation Committee organised a full-day seminar on ‘Tax Audit’ at the BCAS Conference Hall on 23rd
August, 2019.

President Manish Sampat gave the opening remarks. Chairman of the Taxation Committee Ameet Patel gave a brief overview of the seminar and explained the importance of tax audit in the current scenario. He also informed the participants about the onerous responsibility cast on the tax auditor, given that the selection as well as the assessment is now going to be online.

The following topics were taken up by the learned speakers:

Programme Speakers
Audit aspect of Tax Audit – overview of Tax Audit provisions, reporting requirements, audit quality, verification of documents, documentation in light of ICDS, obtaining and relying on management representation, reliance on test checks, etc. CA Himanshu Kishnadwala
Issues arising with tax audit of companies following Ind AS reporting in clauses 13 to 17, clause 19 and clause 24 CA Manish Shah
Reporting in Form 3CD – Certain clauses (namely, clauses 20 to 23, clauses 25 to 27, clauses 30A to 30B and clauses 42 to 44) CA Sonalee Godbole
Reporting in Form 3CD – Certain clauses (namely, clauses 28 to 29B, clause 31, clause 32, clause 34, clause 36 and clause 36A) CA Jagdish Punjabi

Himanshu Kishnadwala set the ball rolling by highlighting various audit aspects that one should keep in mind while conducting a tax audit. He gave his practical insights pertaining to some of the clauses and stressed on the importance of documentation in tax audit.

Next came Manish Shah who described the impact of ICDS through case studies. He also took the audience through various case studies to explain the impact of Ind AS on various clauses in a tax audit report. Apart from the discussion on ICDS and Ind AS, he also dealt with clauses dealing with presumptive taxation.

Sonalee Godbole made a detailed presentation on clauses relating to secondary adjustment, thin capitalisation, GAAR and CBCR. She explained the concepts in a lucid manner with the help of examples and case studies. She also discussed the requirement of reporting the filing in Form 61A and Form 61B.

The last session was addressed by Jagdish Punjabi who covered a large number of clauses, including those related to TDS. He also discussed the impact of section 56(2) on hybrid instruments issued by the company and its reporting requirement in Form 3CD. Apart from this, he explained the applicability of sections 269SS and 269T to loans by book entry and their reporting requirement in Form 3CD.

All the sessions were interactive, with the speakers sharing their insights on their respective subjects. The participants benefited immensely with the guidance and practical views on various issues.

DIRECT TAX LAWS STUDY CIRCLE

The Direct Tax Laws Study Circle meeting on ‘Income Computation and Disclosure Standards (ICDS)’ was held on 6th September, 2019 at the BCAS Conference Hall. Group leader CA Darshak Shah gave a brief overview of the applicability of ICDS provisions and the corresponding sections in the Income-tax Act, 1961 (Act). He also explained the general approach to resolve conflicts between the provisions of the Act and ICDS.Thereafter, he discussed in detail the ten ICDS with various examples and relevant case laws. The group leader took questions from the participants with respect to the relevant examples. Besides, he touched upon the possibility of double taxation in case of ICDS – X relating to ‘Provisions, Contingent Assets and Contingent Liabilities’ in a certain scenario.The session concluded with a vote of thanks to the speaker, Darshak Shah.

FELICITATION OF FRESH, YOUNG CAS

Talk on ‘Career Planning & Interview Skills for Fresh CAs’ held on 13th September, 2019 at BCAS Conference Hall

Yet another programme organised by the Seminar, Public Relations and Membership Development (SPR&MD) Committee was the felicitation programme for the newly-qualified chartered accountants who had cleared the June, 2019 examination. In fact, within hours of the announcement, the online enrolments crossed the record figure of 300, forcing BCAS to close registrations for this crucial programme.

There was a full house of 160+ participants, including some walk-ins. They were greeted at the registration desk with a copy of the BCA Journal and a membership form.

The evening started with Coordinator CA Preeti Cherian welcoming the participants and giving an overview of the purpose of the event. She was followed by President CA Manish Sampat who took the opportunity to walk down memory lane and recall his early days as a qualified chartered accountant, the sound advice that he had received from his seniors to associate himself with the BCAS, to the present when he had taken over as its President. He described the various initiatives of the Society and particularly dwelt on the 5G Annual Plan.
Chairman CA Narayan Pasari candidly admitted that the Youth or Yuva Shakti was an integral part of the numerous activities organised by the BCAS. He also appealed to the new CAs to become members and play an active role in its various activities. While speaking about the Committee’s initiatives, he talked about the Referencer, the annual RRC and other programmes. He proudly shared that the BCAS was very active on social media and its handle @BCASGlobal had recently crossed the 30K mark.

The speaker for the evening was CA Himani Shah who spoke at length on the various jobs available in the finance industry for chartered accountants. She shared tips on interview skills, including first impressions, what to do before the interview, what to wear, how to prepare, guidelines to answer questions, asking the right questions, etc. She also elaborated on the power of visual communication, business etiquette and communication. That her talk was well received could be judged from the fact that many participants had numerous questions to ask of her in the interactive session that followed.
As part of the felicitation programme, each of the participants was presented a pen with BCAS and the word ‘Achiever’ inscribed on it. The event showcased the vibrancy of the participants, many of whom showed great interest in signing up to be members of the BCAS.
A unique feature of the evening was when one of the participants thanked the speaker for clearing the many doubts that she and her fellow participants harboured. The evening ended with a vote of thanks by Convener CA Mrinal Mehta.

SOCIETY NEWS

BEPS STUDY CIRCLE

Study Circle meetings held on 2nd May, 2019 and 11th
May, 2019 at BCAS Conference Hall

 

The BEPS Study Circle
meeting was held on 2nd May, 2019 to discuss “Article 7 of MLI with
reference to Principal Purpose Test – Analysis of provisions using case
studies”. The discussion was led by Ms Sonia Agarwal and Mr. Rutvik Sanghvi.
They gave a well-prepared analytical presentation which was followed by an
interesting discussion between members.

 

Meanwhile, CBDT has come
out with a draft report for public consultation on amendments to the Rules for
Profit Attribution to Permanent Establishment. The report outlined the formula
for calculating “profits attributable to operations in India” giving weightage
to sales revenue, employees, wages paid and assets deployed. To understand the
implication of the draft report at a very short notice, a study meeting was
held on 11th May, 2019 at the BCAS Conference Hall. Mr. Ganesh
Rajgopalan analysed the report in his masterly way. Thereafter, Mr. Rashminbhai
Sanghvi explained the background and implications of the draft report. The
meeting was very interactive and the participants benefited tremendously from the
discussion.

 

ITF STUDY CIRCLE

 

Meeting on Taxation of
Agency PE in the light of OECD Commentary (BEPS Action Plan) – Part II &
III held on 9th May, 2019 and 23rd May, 2019 at BCAS
Conference Hall

 

The discussion was led by
Mr. Kartik Badiani.

 

At the Part II meeting on 9th
May, 2019 a brief recap of the earlier session was given to summarise the
discussions. The group leader took the members through the various provisions
of article 12 of the Multilateral Instrument relating to the measures for
preventing avoidance of a permanent establishment. He explained the
commissionaire arrangement and why it is not very relevant in the Indian
context. He also described the expanded scope of the Agency PE arising out of
the new provisions, especially regarding activities of dependent agents in
respect of contracts for the transfer of the ownership of, or for the granting
of the right to use, property owned by that enterprise, or that the enterprise
has the right to use for the provision of services by it.

 

Then, he compared the MLI
provisions with the newly-substituted Explanation 2(a) to section 9(1)(i) of
the Income-tax Act. The scope of the substituted Explanation and its
applicability to purchasing activities for export or otherwise was also
discussed.

 

Mr. Badiani explained
Articles 5(4), 5(5) and 5(6) of the existing treaty along with the OECD
commentary. He also took the gathering through the proposed changes vis-a-vis
the existing treaty provisions.

 

In Part III, which was held
on 23rd May, 2019 the group leader, after giving a recap of the
previous sessions, deliberated on nuances of the MLI and BEPS action plan on
Agency PE. Apart from a case study on low risk distributor, treaty shopping and
liaison office, an in-depth deliberation on the latest judicial precedence in
the case of General Electric and Daikin was also taken up by the Speaker, Mr.
Badiani.

 

DIRECT TAX STUDY CIRCLE

 

Discussion on ‘Issues
relating to Re-assessment’ held on 21st May, 2019 at BCAS Conference
Hall

 

The Chairman of the
session, CA Sanjeev Pandit,  in his
opening remarks pointed out that the number of notices issued u/s. 148 by the
Income-tax department had been increasing over the years due to various
reasons.

 

Later, Group Leader CA
Navin Gandhi analysed section 147 along with provisos and the explanation to
the section. The group discussed concepts such as “Reasons to believe”, “Income
chargeable to tax”, “May assess or re-assess” which are crucial for the
application of section 147. He then referred to the conditions to be fulfilled
by the AO for issuance of notice u/s. 148 after four years from the end of the
relevant assessment year and the distinguishing factors about issuance within a
period of four years from the end of the relevant assessment year. The Supreme
Court decision in GKN Driveshafts (India) Ltd vs. ITO (2003) 259 ITR 19
(SC), a landmark ruling on the issue, was also briefly touched upon by
CA Navin Gandhi.

 

Thereafter, the group
discussed the following issues along with relevant case laws relating to
reassessment proceedings:

 

  •      Issuance of notice u/s. 143(2) during
    the course of reassessment proceedings;
  •      Reopening of proceedings based on
    change of opinion;
  •      Reopening on ground of
    “oversight, inadvertence or mistake”;
  •      Before issuing notice u/s. 148, the AO
    must have reasons to believe that the income has escaped the assessment;
  •      Time limit u/s. 149(1)(a) / (c);
  •      Retraction of the statement on which
    reassessment is based;
  •      Right to make inquiry of unrelated
    issues;
  •      Sharing of evidence during the course
    of proceedings;
  •         Right to cross-examination; and
  •      Notice issued u/s. 148 on a deceased
    person.

 

Lastly, the decision of the
Bombay High Court in the case of CIT vs. Jet Airways (I) Ltd. (2011) 331
ITR 236 was discussed wherein it was held that where the ground on
which reassessment notice u/s. 148 was issued was dropped while passing
reassessment order, the AO could not reassess or assess any other income which
had escaped assessment.

 

Lecture meeting on ‘AI,
ML and Future of Internal Auditing’ held on 24th May, 2019 at BCAS
Conference Hall

 

BCAS and IIA Bombay Chapter jointly organised a lecture
meeting on “AI, ML and Future of Internal Auditing”. The speaker was Mr.
Shailesh Haribhakti who said that in today’s hyper-connected world, the
expectation from internal audit had undergone a sea change. The new rules of
the game were: More from less, Faster, No waste, No damage to Environment,
Continuous auditing and Continuous improvement for process excellence.

 

Mr. Haribhakti insisted
that internal auditors need to have pride in what they are doing; they need to
be determined and have integrity and ambition, too. Today, data flows were
creating and generating accounting. Everything and everyone was working through
portals, such as tax portals, legal portals, operations portals, etc. By
integrating accounting at the time of data generation, errors and wastages
could be avoided.

 

Internal audit had to be
ready 24×7 and with due diligence. It had to be ready to do and face forensic
audit.

 

They needed to be online
with all their documentation every day; offer solutions and not ideas; stay on
course every single day; demand more from themselves and others and make
winning a habit; establish morality of processes; make themselves relevant;
contribute and promote values continuously; have a dashboard to monitor
themselves and the organisation, continuously upskill themselves. Transparency,
trust and technology had to be the key drivers.

 

Internal auditors also had
to get themselves upgraded with the latest trends such as Robotic Process
Automation, Artificial Intelligence and Data Science. Today, an internal
auditor had to be a data scientist as well. This was because expectation had
moved from insight to foresight. Data was all about pattern and trends; for example,
can the past data be back-tested to check the current findings?

 

Mr. Haribhakti said that in
today’s world, primarily, financial risks were being assessed, but technology
risks, environment, social and governance (ESG) risks were ignored. The
approach wherein one just ticked a box would not do. AI tools could help assess
every component in the audit and risk universe. They could also help find
patterns.

 

His key takeaways were as
follows: Create a vigil mechanism; power it with AI / ML; create dashboards to
monitor the pulse of the organisation, including KPIs / KRIs; continuously
challenge the status quo; evolve rapidly and be ahead of the trends.

INTERNATIONAL ECONOMICS STUDY GROUP

 

Meeting on ‘Economic
Impact of Modi 2.0’ held on 28th May, 2019 at BCAS Conference Hall

 

The International Economics
Study Group held its meeting on 28th May, 2019 to discuss “Economic
Impact of Modi 2.0“. CA Shalin Divetia led the discussion presenting
key differences between the mandates of 2014 and 2019, such as enhanced moral
authority due to the stronger second mandate, better grip over administration,
better relationship with the RBI, key challenges identified and fundamental
changes implemented – GST and IBC. Prime Minister Modi is facing challenges
such as past excesses of the financial / banking sector, creation of jobs
amidst automation / protectionism, the aspirational burgeoning population,
farm-sector woes, judicial activism and NGO-led foreign interference.

 

CA Shalin Divetia also
threw light on the “circle” of national economy – ultimate objectives of
welfare state and national security funded mostly by tax revenues which will
generate consumption – which should come from domestic production – which
ideally requires increased capex and efficient infrastructure – which, in turn,
will impact monetary liquidity – which results from low-cost funding arising
out of low inflation – which is impacted by low CAD and low fiscal deficit
impacted by tax revenues!

 

Therefore, he highlighted
the Modi government’s focus on increasing tax revenues for which he presented
data of buoyancy in tax collection over the last three years which had been
showing in an improved tax-to-GDP ratio. He also presented data on fiscal
deficit, inflation, cost of funds for businesses, monetary liquidity,
government spending on infrastructure and encouragement to domestic
manufacturing which would result in control of CAD and fiscal deficit.

 

Members also discussed “Modi
Sarkar 2.0: What Should We Look Forward to?” wherein they analysed the
reasons for the stupendous success registered by him. They also dwelt on his
long-term vision and the most important aspect of taking India’s current $2.5
trillion economy to a $5 trillion economy by the year 2025 and $10 trillion by
2032. They noted that the BJP’s “Sankalp Patra” (election manifesto) had
indicated investments of $1.44 trillion. The election results in key states in
the Hindi heartland and in Bengal were also discussed.

 

Indirect Tax Study
Circle meeting held on 30th May, 2019 at BCAS Conference Hall

 

CA Janak Vaghani played the
perfect mentor when the Indirect Tax Study Circle held an interesting meeting
on the important topic of “Real Estate-Related Recent Notifications – GST” This
was the second part (Part II) of the series highlighting the crucial issue.

 

Thanks to Group Leader CA
Adit Shah, who conducted the proceedings admirably well, the members took part
in a detailed interaction at which they exchanged views on the case studies and
issues that had been forwarded to all the participants in advance. As a result, most of them
came well prepared for the meeting and were able to make their reasoned points
in detail.

           

Apart from this, a few
other points were identified and set aside for future representation to the
government bodies concerned.

 

Mentor Janak Vaghani and
Group Leader Adit Shah formed a very good team as they steered the discussions
adeptly and kept the proceedings on track.

 

The meeting concluded with
a vote of thanks to the duo of Janak and Adit.

 

Training Session for CA
article students on ‘GST Audit from Article’s Perspective’ and ‘Filing of
Annual Return’ held on 31st May, 2019 at BCAS Conference Hall

 

The Students Forum under
the auspices of the HRD Committee organised this training session for CA
article students on the above-mentioned topics.

 

The first session on GST
Annual Return was conducted by CA Jigar Shah; it was followed by the session on
GST Audit by CA Raj Khona. Ms Devyani Choksi, the student co-ordinator,
introduced the speakers and described the upcoming events for students. CA
Anand Kothari, Convener of the HRD Committee, welcomed both speakers with a
memento.

 

CA Jigar Shah explained the
entire Form GSTR-9 clause by clause and dealt with the various issues /
complexities involved in the annual return form by giving practical examples.
He highlighted a few key areas which article students should keep in mind while
filing the annual returns.

 

 

In the second session, CA
Raj Khona gave a brief insight into various aspects of GST Audit and thoroughly
explained the entire form GSTR-9C. He also gave useful tips to the article
students on how to effectively conduct GST Audit and highlighted the key
challenges. Both the sessions were highly interactive and the speakers answered
all the queries raised by the participants.


With the due dates for GST
Audit fast approaching and every CA firm wanting its articles to be well
equipped with the nitty-gritty’s of GST Annual return and GST Audit, the
training session saw a record participation by over 100 students. The session
ended with the Convener, CA  Anand
Kothari, proposing the vote of thanks to the speakers for sparing their
valuable time and to the audience for participating in huge numbers.

 

Training Session for CA
Article Students on ‘Preparation and Filing of Income Tax Returns for July,
2019’ held on 07th June, 2019 at BCAS Conference Hall

 

The Students’ Forum, under
the auspices of the HRD Committee, organised this training session for CA
Article Students from 6 pm on 7th June at the BCAS Conference Hall.

 

The session was conducted
by CA Divya Jokhakar. The Student Co-ordinator, Mr. Aniruddh Parthsarthy,
introduced the speaker for the session and spoke about the upcoming events for
students.

 

CA Divya Jokhakar first
highlighted the new amendments pertaining to A.Y. 2019-20. She then spoke
briefly about the applicability of various forms to certain categories of
assessees. She also gave useful tips to the article students on how to
effectively prepare and fill the ITR Forms and highlighted the key challenges.
The session was highly interactive.

 

With the due dates for
Income-tax returns fast approaching and every CA firm wanting its articles to
be well-informed and well–equipped, the training session saw eager
participation by more than 70 students. The session ended with Convener CA
Anand Kothari proposing the vote of thanks to the speakers and to the audience
for their participation.

Society News

TECHNOLOGY INITIATIVE STUDY CIRCLE

Meeting on ‘Simplify Accounting with QuickBook’ held on 19th July, 2019 at BCAS Conference Hall

The Technology Initiatives Study Circle of the Technology Initiative Committee of the BCAS organised a meeting styled ‘Simplify Accounting with QuickBook’ by CA Paresh Panchal on 19th July 2019.

Paresh explained how to set up QuickBooks online and introduced implementation aspects of QuickBooks that fellow Chartered Accountants could apply for small and mid-sized businesses. A brief overview of various aspects of the software was provided, namely, invoicing, taxing, expenses tracking with payment due dates, cash flow, bank integration and on-time balance along with cash flow movement. The session was followed by questions and answers.

Participants enjoyed the talk and the Q&A session that followed. All queries were answered by the speaker. The session was telecast live for the benefit of outstation members.

TECHNOLOGY INITIATIVE COMMITTEE

Meeting on ‘Hands-on Workshop on Dashboard Reporting with Advance Excel’ held on 2nd August, 2019 at BCAS Conference Hall

Another programme organised by the Technology Committee of the Society was a half-day programme called ‘Hands-on Workshop on Dashboard Reporting with Advance Excel’ at the BCAS Conference Hall on Friday, 2nd August, 2019.

The session was led by CA Nikunj Shah. He explained that Microsoft Power BI is a business intelligence platform that offers a business analytics toolset designed to assist businesses in their efforts to systematically analyse data and share insights.
Nikunj introduced several features on how to use external data to create a pivot table, thereby converting data into information and further into insight by creating a dashboard. He conducted the demonstration of various features of Excel such as creating interactive charts, updating charts with live data and linking charts with the data source for automatic update of charts; he shared his in-depth knowledge with the participants.

The session was highly interactive, and the speaker demonstrated:
(i) New functions of Excel 2013
(ii) Interactive controls to make the dashboard more useful
(iii) Dos & Don’ts of Dashboard
(iv) Dashboard FAQs

In short, participants learned new ways of working more effectively in a business environment. Nikunj answered all the questions raised by the participants who appreciated the efforts put in by the speaker and the group leaders.

TREE PLANTATION AND EYE CAMP BY HRD COMMITTEE

BCAS Tree Plantation Drive and Eye Camp 2019 – Visit to Dharampur-Vansda, Gujarat, on 3rd – 4th August, 2019

The Human Resource Development Committee of the BCAS, jointly with the BCAS Foundation, in the constant pursuit of contributing to the socio-economic development of tribals in the remote interiors of Dharampur district, organised an ambitious social cause visit on 3rd and 4th August, 2019. The visit was for two purposes – tree plantation as part of the mission the ‘Grow Green Drive’, along with captive plantation on farmers’ land at Khadki-Dharampur (at Sarvodaya Parivar Trust – SPT), and an eye camp for cataract surgery at Vansda, Gujarat (at Dhanvantari Trust – DT).

A team of 44 enthusiastic volunteers from BCAS collected over Rs. 5 lakhs as a contribution towards the twin noble causes and set off to visit Dharampur to personally fuel the mission with their active participation. The journey started on a morning when it rained very heavily, all the way from Mumbai to Valsad; this was followed by a bus journey to the little village of Khadki.

The Sarvodaya Parivar Trust is involved in empowering the tribals and making them self-reliant. It engages in various welfare activities in the fields of education / health / agriculture / water management / environment / public awareness programmes and so on.

With the help of local farmers, the enthusiastic BCAS members assisted in planting various saplings of custard apple, mahogany, ambli, kher and bamboo on the outskirts of village Pindval-Khadki. They also distributed and planted mango saplings on the farmers’ land. The team then visited the nursery developed and nurtured by Trustee Sujataben, who has dedicated her entire life to the SPT.
The BCAS Foundation has committed itself to the plantation of 10,000 trees and has already made a contribution of Rs. 3,00,001 received through generous donations from several donors.
The BCAS team was overwhelmed to meet a villager, Pandu, who donated his entire holding of three acres of land to the SPT for carrying out its activities. He has been associated with the SPT ever since then, giving
his selfless service for the noble cause of benefiting the tribal villagers.

The team also visited the residential school run by SPT at Pindval-Khadki and distributed various educational games / stationery / chocolates to the children. It was a pleasure to see the commendable developments that had taken place over the last few years, thanks to the earlier projects done by BCAS with the help of SPT’s selfless team, which has certainly made a difference to the quality and standard of living of tribals at such a remote, interior village.

The team expressed its gratitude and affection for fellow respected CA Virendrabhai and Ashaben Virendra Shah, a lovely, jovial couple dedicated to SPT, living life as per the Gandhian philosophy; they took charge of all the arrangements for the project and treated the visitors from Mumbai like family.
The night halt at Tithal energised all the participants for their visit the next day to the Dhanvantri Trust at Vansda where they organised an eye camp for cataract surgery of the tribal people. The DT trustees were delighted to take the team through the hospital ward to meet and interact with patients and discuss the selfless activities carried out by them.

The Dhanvantri Trust was founded by the Late Dr. Kirtikumar Vaidya, a doctor who left Mumbai at a young age and dedicated his life for the socio-economic development of tribal villages of South Gujarat. With divine blessings and inspiration from his Guru Sant Shri Ranchhod Dasji Bapu, he started the eye hospital in Vansda. Till date, it has performed more than 42,000 successful cataract surgeries and has expanded to a multi-specialty ward.

The BCAS Foundation has committed to help perform 200 cataract surgeries and has made a contribution of Rs. 2,00,001 received through generous donors.

The team departed with a heavy heart and innumerable memories to board the train back to Mumbai. The youth team that participated in the event was deeply moved with the deliberations of the senior members and the interactions with the trustees of the NGOs, inculcating in them values of life and inspiring them for selfless service to society. In turn, the senior members got enthused with the zeal of the young participants and their new and dynamic ideas. The bonding that was shared amongst them was indescribable and all felt truly blessed at the end of the journey.

Indeed this soulful trip was an elevating and enlightening experience for everybody to feel a bit of a shift within from sympathy to empathy.

DIRECT TAX STUDY CIRCLE

Meeting on ‘Angel Taxation’ on 5th August, 2019 at BCAS Conference Hall

The group leader, CA Mahesh Nayak, gave a brief overview of the introduction of section 56(2)(viib) of the Income-tax Act, 1961. The provision was then analysed in detail. The group leader next dwelt on the meaning of ‘company in which the public are substantially interested’, with illustrations.

Thereafter, the group discussed the exemptions in the case of investments by certain AIFs, the exemption for investment in startups and the investment restrictions applicable to them. The consequences of non-compliance of investment restrictions were discussed by way of an illustration.

Finally, the valuation methodology to be adopted as per Rule 11UA was discussed along with relevant case laws and the interaction of section 56(2)(viib) and section 56(2)(x) of the Act.

SOCIETY NEWS

CORPORATE AND ALLIED LAWS COMMITTEE

“Company Law Conclave – 2019” held on 15th & 16th March, 2019

A two-day Company Law Conclave – 2019 was organised by the Corporate & Allied Laws Committee on 15th & 16th March, 2019 at Hotel Orchid, Mumbai, with distinguished speakers and panellists sharing their in-depth knowledge and experience on the subject. President CA. Sunil Gabhawalla gave the inaugural remarks, followed by opening comments from the Chairman of the Corporate and Allied Laws Committee, CA. Chetan Shah.

CA. Nilesh Vikamsey, Past President of ICAI, delivered the keynote address and highlighted the journey of various amendments in the short period since the enactment of the Companies Act, 2013 including a statistical analysis thereof; he also highlighted the challenges faced, especially by professionals, in various compliances thereunder.

The first technical session was taken up by CA. Bhavesh Vora who dealt with the topic Significant Beneficial Ownership (SBO). He explained the difference between registered owner and beneficial owner, stages of Money-laundering leading to the rationale behind the introduction of SBO declarations, the applicability and non-applicability of SBO declarations, etc. He also gave valuable insights on provisions of the Companies Act, 2013 relating to Acceptance of Deposits and Dematerialisation of Shares and touched upon the Banning of Unregulated Deposit Schemes Ordinance, 2019 which was promulgated on 21st February, 2019.

The second session was a panel discussion on Recent Trends of actions from Regulators such as SEBI, Stock Exchanges and MCA with respect to Audit Committees, Auditors and Directors, including Independent Directors. The esteemed panellists were CA. Shailesh Haribhakti, CA. Dolphy D’Souza and CA. Bhavesh Vora. The session was ably moderated by CA. Sandeep Shah who made the proceedings informative and interesting.

In the third session, CA. Manish Sampat, Vice President, BCAS, explained the relevant provisions of the Companies Act, 2013 relating to Loans and Investments, Borrowings, Related Party Transactions and Foreign Companies – establishing liaison/project/branch office in India and shared his practical experience. He also gave a brief overview of FEMA provisions.

Thereafter, Mr. Amit Tandon apprised the participants about the Dawn of proxy/voting advisory firms in India and corporate governance trends evolving in India. He expressed the view that shareholder engagement had been increasing in India in the recent past and shared specific examples of how effective shareholders’ engagement had resulted in not allowing the Board to have its own way.

In the last session on Day 1, CA. Avil Menezes dealt with Corporate Insolvency (winding up) in IBC Era. He explained the liquidation process under the IBC and responded to several queries of the participants in this regard.

Day 2 began with the session on Accounts, Audit and CSR’ under the Companies Act, 2013 by CA. Himanshu Kishnadwala. He elaborated the financial statements – AS and Ind AS, reopening of financial statements, declaration of dividend, NFRA and CSR provisions applicable to the companies, and shared insights on audit and auditors’ responsibilities and other services that can be rendered by the auditor/its affiliate or associate.

This was followed by a panel discussion on Role & Responsibilities of Directors, Conflicts of Interest other than related party transactions and Directors’ Potential Liabilities in Insolvency. The distinguished panellists, viz., CS. Shailesh Rajadhyaksha, CA. Uday Chitale and Adv. Bharat Vasani, shared their views and rich experience. Adv. Bharat Vasani, with his legal background, threw light on the Directors’ responsibilities and liabilities under the Companies Act as well as some other laws. The session was ably moderated by CA. Nawshir Mirza who made the interaction more educative and effective.

Thereafter, the session on Schemes of Compromises, Arrangements and Amalgamations – Procedural aspects was taken up by Adv. Bhumika Batra. She, inter alia, covered the benefits, governing statutes and various stages of schemes of compromise and arrangements. The concluding session on Day 2 was taken up by CS B. Renganathan on Schemes of Compromises, Arrangements and Amalgamations – Some Peculiar Illustrations. He discussed some of the path-breaking schemes of compromises and arrangements.

The event garnered good response and saw attendance from outstation participants from various cities. Overall, the Company Law Conclave was an enriching experience for the participants.

Training Session on “Practical Aspects of Bank Audit from Article’s Perspective” held on 22nd March 2019 at BCAS Conference Hall

The Students’ Forum under the auspices of the HRD Committee organised a training session on the above-mentioned topic on 22nd March, 2019 in the BCAS Conference Hall which was led by CA. Pankaj Tiwari, a proficient speaker on the subject. Ms. Divya Jadav, the student co-ordinator, introduced him to the participants. She was followed by CA. Jigar Shah, HRD Committee member, who also addressed the students.

CA Pankaj Tiwari spoke about the current banking scenario and briefed the students on various recent circulars issued by the RBI. He covered several issues and aspects which needed to be looked into by the article students while conducting a bank audit. He meticulously explained the issues involved through case studies and practical examples; he gave useful tips to the article students on how to effectively conduct Bank Audit and provided a checklist of the critical areas to be focused upon.

The training session ended with Mr. Jason Joseph, student co-ordinator, proposing the vote of thanks to the speaker for sparing his valuable time and the audience for participating in huge numbers. With the “Bank Audit season” round the corner, the topic had its own importance which could be easily seen by the tremendous response received from the students. Overall, the session was very informative and the participants benefited a lot from it.

ITF STUDY CIRCLE

Study Circle on “Agency PE – Analysis of Amendment under the Act and MLI” held on 25th March, 2019 at BCAS Conference Hall

The ITF Study Circle organised a meeting on Agency PE – Analysis of Amendment under the Act and MLI on 25th March, 2019 in the BCAS Conference Hall. It was led by the Group Leader, CA. Kartik Badiani who took the members through the various provisions of Article 12 of the Multilateral Instrument relating to the measures for preventing avoidance of a permanent establishment. He explained the commissionaire arrangement and why it is not very relevant in the Indian context.

CA. Kartik Badiani also described the expanded scope of the agency PE arising out of the new provisions, especially regarding activities of dependent agents in respect of contracts for the transfer of the ownership of, or for the granting of the right to use property owned by that enterprise, or that the enterprise has the right to use for the provision of services by that enterprise.

He then compared the MLI provisions with the newly-substituted Explanation 2(a) to section 9(1)(i) of the Income-tax Act. The scope of the substituted explanation and its applicability to purchasing activities for export or otherwise was also discussed.

The meeting was very interactive and presented a huge takeaway for the participants.

Lecture Meeting on “The Banning of Unregulated Deposit Schemes Ordinance, 2019” held on 28th March, 2019 at BCAS Conference Hall

The Bombay Chartered Accountants’ Society organised a lecture meeting on ‘The Banning of Unregulated Deposit Schemes Ordinance, 2019’ on 28th March, 2019 in the BCAS Conference Hall which was addressed by CA. Sandeep Shah.

CA. Sandeep discussed the background of the Ordinance and its applicability and then covered key definitions, the genesis, salient features, administration and challenges and confusion, as also the offences under it. He touched upon the Reserve Bank of India Act, 1934 and the Maharashtra Protection of Interest of Depositors (in Financial Establishments) Act, 1999 to put forth his views. He also talked about the types of schemes such as “Ponzy” and “Pyramid Schemes” and explained the applicability and the exemptions under the Ordinance. He described the characteristics of regulated and unregulated deposit schemes and the offences covered by the Ordinance, i.e., inducement and punishment, etc., thereof.

Thereafter, the speaker described the challenges and confusions faced in implementing the Ordinance and the administrative aspects and penalties imposed for indulging in contravention of the Ordinance, including imprisonment, fines, etc. He also outlined and emphasised the role of an auditor in stricter compliance of the Ordinance and the consequences of non-compliance with laws and regulations of the Ordinance.

The lecture was followed by a Q&A session in which the participants raised queries which were emphatically answered by the learned speaker. The participants were enlightened with the interesting and important developments in the financial domain which were effectively explained by the speaker, CA. Sandeep Shah.

“Blood Donation Drive” organised on 29th March, 2019 at BCAS Conference Hall

BCAS continues with its initiative of connecting with and contributing to the society at large for a non-professional cause. Its blood donation drive encourages a sense of “Personal Social Responsibility” (PSR) among its members, their relatives and friends.

The BCAS Foundation, along with the Seminar and Membership Development (SMD) Committee, organised its 3rd Blood Donation Drive on 29th March, 2019 at BCAS Conference Hall in collaboration with Tata Memorial Hospital (TMH), one of the renowned hospitals in Mumbai with its sophisticated blood bank facilities. TMH also provided a knowledge desk for platelet donation for the benefit of members and for creating awareness about the basics of platelet donation.

Awareness and messages were widely spread by the BCAS team for the drive, especially in all the offices, educational institutions and government offices in and around the New Marine Lines area. CA. Sunil Gabhawalla, President, BCAS, and CA. Narayan Pasari, Chairman, SMD Committee, led the drive along with some committee members and encouraged and inspired many people to become donors.

For the blood donation, the donors had to follow a step-by-step procedure covering various parameters before actually donating blood. The specialised team of doctors and supervisors from TMH was very careful with regard to the health and physical condition of the donors to ensure that he/she was fit for donating blood and also completely fit and fine after donating blood.

The donors were given Blood Donation Certificates by TMH and BCAS along with a token gift in appreciation of their participation. BCAS received an overwhelming response to the drive and TMH officials were very happy with the units of blood collected.
It was a great team effort by the 12 volunteers from TMH, the coordinators of the event from the SMD Committee, CA. Sohail Kapasi, CA. Maitri Ahuja and CA. Yogesh Patel, along with other members of the BCAS and the BCAS staff who actively extended their support. It was indeed a memorable experience through which BCAS gave an opportunity to inculcate/nurture a sense of PSR amongst members as well as non-members.

(Note: PSR can be called a “twin sister” of CSR which stands for “Corporate Social Responsibility”.)

BCAS TECH SUMMIT 2019 HELD ON 30th MARCH, 2019

The Technology Initiatives Committee of the BCAS organised the 1st BCAS Tech Summit 2019 on 30th March, 2019 at Courtyard by Marriott. The event commenced with an inaugural address by President CA. Sunil Gabhawalla, followed by the opening address by CA. Nitin Shingala, the Chairman of the Committee.

The keynote address was delivered by CA. Deepak Ghaisas, Chairman and Chief Mentor, Gencoval Group, and Vice-Chairman, i-flex Solutions. He highlighted the technological trends affecting different sectors and how each trend is an enabler for a chartered accountant to expand his practice.

The panel discussion on Accounting Softwares was led by the moderator, CA. Shariq Contractor. The participants included Ms. Aditi Puri Batra, Intuit, CA. Harsh Vardhan Dawar and CA. Prashant Gupta. The panel discussed the current requirements of the clients and ways to identify accounting software that meets a client’s needs. They also discussed the tools integrated with accounting software that would enable customisation of information. In addition, the panel highlighted transformation in the accounting software with cloud-based accounting applications.

CA. Ameet Patel led the panel discussion on Tax & Compliance Software. The panellists were CA. Raj Mullick, Reliance Industries, CA. Harit Gandhi, TCS, Mr. Rakesh Dube and Mr. Vijaya Mankaragod. While CA. Raj Mullick shared his journey of adapting to technologies to manage GST compliance, CA. Harit Gandhi spoke about developing technologies for GST and VAT compliance and offered his insights into the proposed changes in GST compliance.
Mr. Vijaya Mankaragod highlighted the practices adopted by developed countries in digitising taxation and how Indian tax administration is adapting to these changes. He described the big data analytics being adapted by tax administrations across the world and shared his views on future trends that would drive the taxation sector. Mr. Rakesh Dube, on the other hand, explained the need for having a tax compliance software that worked well with the ERPs to ensure timely compliance with various tax laws. CA. Ameet Patel made the session lively with his wit and humour.

The panel discussion on HR, Payroll & Labour Law compliance software was led by CA. Nitin Shingala, Chairman of the Technology Initiatives Committee himself, and those who took part in it were Mr. Madhu Damodaran, CA. Harish Chopra and Mr. Girish Rowjee.

CA. Nitin initiated the discussion with the current scenario impacting payroll management as nobody could go without pay day except when grounded. Mr. Madhu Damodaran shared his experiences in administering complex HR processes and ensuring employment law compliance through setting up businesses/processes/vendor management systems. CA. Harish Chopra and Mr. Girish Rowjee highlighted trends in payroll accounting and management, future opportunities available and shared tips on how to grow HR and payroll practices.

Another panel discussion, on Practice Management — Leveraging Digital Technologies for Accelerated Growth, was led by CA. Vaibhav Manek. The panellists included CA. Rajeev Sharma, Mr. Suresh Kumar and Mr. Kris Agarwala, Wolters Kluwer. They discussed the trends driving practice management by CA firms and the use of software and applications to ensure efficiency, productivity and training of the employees, when partners can focus on client management.

The session on Robotics Process Automation (RPA) was jointly led by Mr. Ashish Sharma and Mr. Prasad Godbole. They introduced participants to the future trend of robotic accounting and explained how robots can undertake end-to-end transaction processing. The future opportunities available in such a scenario were also highlighted; the case studies and examples discussed by them kept the audience engrossed.

The venue of the 1st BCAS Tech Summit 2019 also featured an exhibition section with product demonstration by Wolters Kluwer, Intuit — Quickbooks, Reliance Jio, TCS IoN, Clear Tax, Firmway, Greytip, Tax Genie and Kredence Digital, all of which opened new vistas for the participants at the event.

The sharing of insights and experiences by the experts, and also the interactions during the networking breaks brought a sense of wonder and created some unforgettable memories of the 1st BCAS Tech Summit 2019.

HUMAN DEVELOPMENT AND TECHNOLOGY INITIATIVES COMMITTEE

Human Development Study Circle meeting on “Vidur Niti from Mahabharata” held on 9th April, 2019 at BCAS Conference Hall

The Human Development Study Circle organised an interesting discussion on “Vidur Niti (containing the lessons of wisdom narrated by Vidur to Dhrutrashtra before Mahabharta War) on 9th April, 2019 at BCAS Conference Hall which was presented by CA. C. N. Vaze. The Speaker talked about some important teachings in relation to human behaviour i.e. Sandhi (Joining), Vigraha (Disconnect), Yana (Aggression), Asana (Sit on compound – non-aligned) and Dwaidhibhav (create dilemma) and also sources of happiness such as to stay healthy, fearless, debt free, in company of good people, be professional and do justice to the profession etc.

Vidur was one of the most respected gurus in the Kingdom of Hastinapur. He had vowed allegiance to the throne (and not to the person occupying it), as a result of which he had to face a lot of hardships when things started going wrong in the kingdom. Before and during the period of the Mahabharata war, he continued to live in Hastinapur – but he did not eat even a single morsel of food from the King’s kitchen. For his consumption, he grew his own grains, fruits and vegetables because he did not want to be contaminated by consuming food served by the “evil” forces that were ruling the land and the ill wind that was blowing over it. He lived by himself and was always willing to give advice in the court – but there was hardly anyone to listen to him. It was his disciples who noted down his sermons and came up with what is called “Vidur Niti”.

It was an extremely interesting session and the participants learned about several hitherto unknown aspects of the respected sage, seer and guru, Vidur.

HUMAN RESOURCE DEVELOPMENT COMMITTEE

Full-Day Workshopon “Effective Leadership and Executive Presence” held on 13th April, 2019 at the BCAS Conference Hall

The HRD Committee organised a full-day workshop for enhancing executive gravitas and developing better leadership acumen. It was conducted by the young and dynamic CA. Mudit Yadav who is a skilled and internationally-certified success coach.

He stressed on the following 4 modules:

(1) How a leader can motivate his team by making subtle changes in his vocabulary and leadership style that will inspire his team and hence get more work done.

(2) How to convey feedback in an effective manner that hurts the least but hits the most and thus being able to identify the strengths of the team and balance them with opportunities and team expectations.

(3) How to influence people like successful political leaders, by learning techniques in interpersonal interactions with the team and clients and making effective presentations, speeches and the use of a power vocabulary.

(4) What to wear, how to walk and ways to talk to enhance your presence and thus building respect and reverence in the minds of your colleagues, further addressing the body language, wardrobe and postures that leaders can apply on themselves to build greater presence.

The session was very interactive and the group activities conducted by CA. Mudit Yadav helped the participants to sharpen their skills and take home a valuable lesson at the end of the workshop.

INTERNATIONAL ECONOMICS STUDY GROUP

International Economics Study Group meeting on “How Foreign-Funded NGOs (Professional Agitators) are Hurting Economic Growth” held on 16th April, 2019 at BCAS Conference Hall

The International Economics Study Group held its meeting on 16th April, 2019 at BCAS Conference Hall to discuss “How Foreign-Funded NGOs (Professional Agitators) are Hurting Economic Growth.”

CA. Deepak Karanth led the discussions and presented his thoughts on the subject, describing how concerted efforts by select foreign-funded NGOs ran “rent-an-agitation” stirs to “take down” mega developmental projects in India in order to adversely impact the economic growth of the country.

Thousands of NGOs were involved in genuine social service and health-related activities; they had become part of a wide variety of activities: aid, development, healthcare, education, feminism, the environment, human rights, conscientisation (sic), organisation, etc. But sometime back, the Intelligence Bureau had submitted a report to the PMO suggesting that many foreign-funded NGOs protesting against coal and mining projects in the country were stalling India’s development and had negatively impacted GDP growth by 2 to 3%.

Many such “Professional Agitators” (funded by well-known philanthropies in western countries) had tried to stall large projects. These NGOs had received funds in the form of “research funding”. Cracking the whip on this trend, approximately 20,000 NGOs in the country had been barred from receiving foreign funds by the government following cancellation of their FCRA registrations, said CA. Deepak.

The Intelligence Bureau report said that among the agitations pursuing ”anti-developmental activities” were those that were against nuclear infrastructure development, coal-fired power plants, genetically-modified organisms; Posco in Orissa, Vedanta in Orissa, the Narmada Bachao Andolan; the agitations against extractive industries in the North East and the agitation against the Kudankulam Nuclear Power Project.

CA. Paresh Budhdev led the discussion on the impact of debt defaults arising out of cases like IL&FS on mutual funds’ debt schemes and provident and pension funds (government as well as privately-run employees’ PFs) and the overall debt market.

The meeting was very interactive and participants benefited a lot from the discussion.

Society News

WORKSHOP BY ACCOUNTING AND AUDITING COMMITTEE

 

On 6th September, 2019, the Accounting and Auditing Committee organised a full-day workshop on ‘Changes Relevant for Preparation of Financial Statements and Audit Reporting thereon for 2018-19’ (with focus on private limited companies and public companies other than to whom Ind AS applies). The workshop, held at the BCAS Conference Hall, began with opening remarks by President Manish Sampat. He was followed by Accounting and Auditing Committee Chairman Himanshu Kishnadwala who briefed the participants on the need for the workshop and the relevance of the topics selected.

 

The following topics were taken up at the workshop by the various speakers:
(i) Audit of SMEs – Some important aspects: Nikhil Patel;
(ii) Important provisions of the Companies Act, 2013 (as relevant for audit of financial statements for the F.Y. 2018-19): Paresh Clerk;
(iii) Critical FRRB observations on financial statements and audit reporting (with focus on items applicable to private limited companies for 2018-19): Abhay Mehta;
(iv) Audit reporting requirements (including CARO and ICFR reporting; with focus on audit of private limited companies): Zubin Billimoria.

 

Nikhil Patel, who set the ball rolling, highlighted the important aspects involved in the audit of SMEs. He took up various case studies regarding rotation of auditors, applicability of Ind AS and important aspects of the existing Accounting Standards as applicable to SMEs and recent changes in disclosure requirements of Schedule III and their impact on financial statements.

 

Taking up the second session, Paresh Clerk dealt with important provisions of the Companies Act, 2013 as relevant for the audit of financial statements for the financial year 2018-19. He discussed the interplay between various definitions under the Companies Act, 2013 and those under the relevant Accounting Standards. He also covered important sections of the Companies Act, 2013 which included deposit rules, managerial remuneration, loans to directors, dividend and CSR (Corporate Social Responsibility) which are relevant for the financial year 2018-19.

 

In the penultimate session,  Abhay Mehta took the participants through critical observations made by the Financial Reporting Review Board (FRRB) based on the reviews of the financial statements conducted by the Board and stressed upon the need for course correction in auditing the financial statements for the financial year 2018-19. His presentation covered critical observations in the areas of accounting standards, auditing standards and company law compliances.

 

Last but not the least, Zubin Billimoria took up audit reporting requirements, including ICFR and CARO reporting and recent changes in audit reporting requirements as applicable for the reporting period 2018-19. His presentation included important aspects such as evaluating ‘Going Concern’ assumption, ‘Emphasis of Matter’ (EOM) paragraph, modified report, qualified report and disclaimer of opinion.

 

All the sessions were very interactive and the speakers shared their experience and insights on their respective subjects.
The workshop was well appreciated and the participants benefited from the guidance and practical views expressed by the experts.

 

FULL-DAY SEMINAR ON ‘CHARITABLE TRUSTS – CRITICAL ASPECTS’
The Corporate and Allied Laws Committee organised a day-long seminar on ‘Charitable Trusts – Critical Aspects’ jointly with the Chamber of Tax Consultants on 14th September, 2019 at the BCAS Conference Hall.

 

The seminar, at which recent developments and critical aspects in the sector were debated, was opened by President Manish Sampat who briefed participants about recent developments in the non-profit organisation sector. He also highlighted the challenges as well as the opportunities available to the practising chartered accountants in this field. Vipul Choksi, President of the Chamber of Tax Consultants, appreciated the initiative taken by BCAS in organising such an event and shared his views on compliance and other related issues of charitable trusts.

 

The seminar was inaugurated by the Hon. Charity Commissioner of Maharashtra, Mr. Sanjay Mehare. He addressed the first session on ‘Important Procedural Aspects for Trustees and Professionals’ wherein he shared his views on the recent changes in the Bombay Public Trust Act, FCRA, etc., and various other procedural aspects relating to the formation and compliance requirements for charitable trusts. His past experience and the examples he gave held the audience spell-bound.

 

The second session was addressed by Gautam Shah who spoke about various advantages and disadvantages of charitable institutions vis-a-vis private trusts. The new concept regarding Social Stock Exchange as announced by the Finance Minister, Mrs. Nirmala Sitharaman, during her Budget speech was covered in detail by him. He also addressed some issues related to formation of minority status trusts.

 

Gautam Nayak, in the third session, discussed various issues regarding taxation of charitable trusts, including the issues arising out of the rejection of the registration of charitable organisations. He also spoke briefly on dissolution of charitable trusts and gave an insight into the implications of section 115TD of the Income-tax Act. The participants in the seminar appreciated the discussion on the recent controversial decisions in direct tax for trusts.

 

The next session was conducted by advocate Rakesh Pandey on the hardships faced in the Office of the Charity Commissioner. The requirements specified in some of the sections of the Maharashtra Public Trust Act and their intricacies, the difficulties in complying with such requirements in the current environment at the Charity Commissioner’s office were also addressed.

 

Next, Sunil Gabhawalla took the podium for the much-awaited session on issues under Goods and Services Tax (GST) for NGOs. The participants had several queries regarding the applicability and liability of GST which were addressed by him in detail. He cleared most of their doubts regarding the applicability of GST. He also explained the reverse charge mechanism and whether it was applicable to trusts.

 

Taking up the sixth session, Anil Sathe enlightened the participants about issues relating to the registration and renewal of FCRA licence. He also discussed the common issues relating to separate bank accounts, administrative expenses and other important aspects to be considered during the filing of FCRA returns. He then deliberated on the issues arising from the changes which are to be submitted online; these attracted a lot of questions by the participants. Anil Sathe also briefly touched upon the issues arising out of CSR donations in relation to unspent amounts and penalty for non-compliance.

 

Mr. Mallikarjun Utture, Additional Commissioner of Income Tax, took the mike for the next session and addressed issues of charitable institutions from the income tax point of view. It was very essential to understand their problems so that these institutions did not have to face tax liabilities when they were eligible for exemptions. He engaged the audience by presenting landmark judgements and necessary elements for getting 12AA registrations and the basis on which these can be rejected.

 

At the end of the seminar, there was a panel discussion moderated by Chetan Shah. Mr. Mallikarjun Utture, Gautan Nayak, Sunil Gabhawalla and Anil Sathe discussed various issues relating to charitable trusts. Finally, the floor was opened for a Q&A session when the panellists answered all the queries of the participants.

 

The interactive seminar was full of insights into charitable trusts and the participants were truly enriched with the presentations and the in-depth analysis offered by the speakers. It received overwhelming response from the industry as well as practising chartered accountants in the field of non-profit organisations.

 

INDIRECT TAX LAW STUDY CIRCLE

 

The Indirect Tax Law Study Circle organised a meeting on ‘Practical implication of RULE 42 & RULE 43 of GST Act’ on 16th September, 2019 at the BCAS Conference Hall.

 

Over 50 persons attended the detailed interaction, discussion and exchange of views with the Group Leader and Mentor on the issues that had been forwarded in advance. There was an in-depth analysis of all the issues at the meeting.

 

The Group Leader was Darshan Ranawat while the Mentor was Mandar Telang.

 

Nearly 50 members were present for the detailed interaction and discussion, and to hear the views of the Group Leader and Mentor on the issues that had been forwarded in advance. It was an in-depth analysis of all the issues with reasoning. The Group Leader dealt with all the issues placed before him in the allotted time. The meeting concluded with a vote of thanks to Group Leader Darshan Ranawat and Mentor Mandar Telang.

 

Study Circle Conveners Chirag Mehta, Dushyant Bhatt and Suresh Choudhary stated later that the participants in the Study Circle meeting had several genuine queries and all of them were answered in great detail.

 

‘SABKA VISHWAS – LEGACY DISPUTE RESOLUTION SCHEME 2019’

 

The BCAS organised a lecture meeting on ‘Sabka Vishwas – Legacy Dispute Resolution Scheme, 2019’ on 17th September, 2019 which was addressed by Advocate Rohit Jain. It was held in the BCAS Conference Hall.

 

Introducing the topic, BCAS President Manish Sampat pointed out that the scheme was a one-time opportunity for resolving disputes related to Central Excise, Service Tax and 26 other indirect tax legislations. Eligible persons opting for the scheme could declare their unpaid tax dues and discharge the same. Declarants under the scheme would be granted immunity, including from interest, penalty and prosecution. He also introduced the speaker. BCAS Vice-President Suhas Paranjpe presented a memento to the speaker.

 

Mr. Jain started the session with a brief history of indirect tax litigations pending with various judicial forums, past amnesty schemes and the constitutional validity of such schemes. He took up the following major areas of
the ‘Sabka Vishwas – Legacy Dispute Resolution Scheme, 2019’:

 

(i) Coverage of various indirect tax acts and cesses under the scheme;
(ii) Relief granted under various case scenarios;
(a) SCN or one or more appeals arising out of such notice,
(b) SCN for late fee or penalty only,
(c) Amount in arrears,
(d) Inquiry or investigation or audit,
(e) Voluntary disclosure.
(iii) Benefits, waivers and eligibility. The relief under the scheme includes waiver of tax ranging from 40% to 70%, 100% relief of interest and penalty;
(iv) Relevant clarifications issued in circulars;
(v) Detailed process for application under the scheme;
(vi) Discharge certificate.

 

Mr. Jain also highlighted some key aspects of the scheme such as ineligibility of convicted assessees, payment under the scheme being allowed only through cash, non-availability of tax paid under the scheme as input tax credit, declaration not treated as admission of tax liability and so on.

 

INTERNAL AUDIT 101: LET’S START AT THE VERY BEGINNING

 

The newly-formed Internal Audit Committee organised a two-day Foundation Course on Internal Audit styled ‘Internal Audit 101’ at the Orchid Hotel on 19th and 20th September, 2019. With 103 participants, the course witnessed a full house, with participants both from the profession as also from the industry. This unique foundation course was curated and designed last year to provide a strong foundation to internal audit professionals. The Committee plans to host this programme annually in Mumbai and other locations as a ‘foundation course on Internal Audit’.

 

The course attracted 73 non-members for many of whom this was their first introduction to a BCAS event. This helped in spreading awareness about the Society amongst non-members, some of whom will become members in the coming months.

 

Interestingly, the course lived up to its promise of delivering sessions in a ‘story-telling’ style with anecdotes, real-life incidents and practical insights to make it a unique and interesting experience for the participants.

 

President Manish Sampat’s welcome address and opening remarks by Chairman Uday Sathaye set the tone for the event. Co-Chairperson Nandita Parekh welcomed the participants and explained the structure of the event and the proposed future events of the Committee.

 

Satish Shenoy’s first session unfolded the ‘lifecycle of an Internal Audit’ by narrating various anecdotes and experiences that educated the audience and also kept it entertained.

 

The second to speak was Jyotin Mehta who provided an overview of Internal Audit and the regulatory framework within which it operates, giving useful insights to help participants understand the larger framework within which Internal Audit operates.

 

Next up was Deepjee Singhal who focused on the meeting point of technology and Internal Audit and covered the entire gamut of areas where the use of technology would be a game-changer. He also covered key considerations for an IT Systems Audit and the crucial need to understand the IT system architecture to conduct a meaningful and efficient Internal Audit.

 

It was then the turn of Himanshu Vasa who engaged and enthralled the participants as he conducted a session on ‘The Art of Telling a Good Story’. He not only shared his thoughts on what it takes to write a good report, but also covered areas of personal presentation, soft skills and oral communication, including the importance of posture and gestures. His marathon session and his expressions left a good impression on the participants.

 

Atul Shah in his presentation took participants through the tools and tricks of the trade, sharing audit techniques deployed at each stage of audit.

 

Talking about specific cycle audits was Ashutosh Pednekar who spoke of covering several audit cycles. He threw light on recent developments, the use of technology and the understanding of process risks. His real-life examples and interesting stories captivated the audience.

 

Nandita Parekh took everyone back to the drawing board on the basics of risks and controls – the simplicity of her talk, along with a vivid presentation, reinforced the core concepts that form the heart of Internal Audit. She explained the concept of risks and controls with reference to everyday experiences and anecdotes; this helped demystify the area of risks and controls and the jargon that has developed around the subject.

 

The two-day session ended with closing remarks by Chairman Uday Sathaye and a few light moments presented by Vice-President Suhas Paranjpe.

 

INTERNATIONAL ECONOMICS STUDY GROUP

 

The International Economics Study Group held its meeting on 20th September, 2019 when it discussed the ‘Emerging Economic Situation – Global and Indian Economy’.

 

Harshad Shah stated that fears of another global economic slowdown are rising as reliable data (endorsed by many economists and CFOs of U.S. Corporations) indicates that the USA – the world’s largest economy – may be headed for another recession. That’s bad enough for global markets, but what’s worse is that many of the world’s other top economies may also be headed for troubling downturns. Japan faces a recession and it has recently entered into a nasty trade dispute with South Korea. South Korea is encountering woes with growth, with a negative first quarter and is embroiled in a trade war with Japan.

 

Months of protests in Hong Kong have brought the financial hub’s economy to a standstill with the looming threat of a possible Chinese military intervention. Singapore is also on the brink of recession. Eurozone faces Category 5 economic storms (double shock of impending global recession and a no-deal Brexit). Growth has essentially stopped in Italy and a political crisis there doesn’t inspire much confidence; it is already in a recession since 2018.

 

Germany’s economy declined in the last quarter with a slump in the export of cars. Europe is stuck between the United States and Russia (gas pipelines and sanctions), China (trade war) and Iran (oil and tankers). Argentina just went through one of the worst stock market crashes. Brazil and Mexico, two leaders of Central and South America’s economies, are expected to perform poorly this year due to slumping commodity prices. On top of it all, China’s growth rate has slowed down due in large part to the trade war launched by President Donald Trump. China’s economy grew by 4.8% in July, the lowest rate since 2002.

 

Put it all together and the world’s economic outlook looks pretty bleak. The IMF, a world body that helps keep the global economy stable, also sees it that way. Last month, it cut its projection for global growth to 3.2 %, the lowest rate since 2009.

 

Why are so many countries headed for recession / slowdown? First, Trump’s deeply misguided trade war. The effects of this go beyond just the US and China’s bilateral trade relationship. Too many nations are facing immense political turmoil at home.

 

Is the USA bracing for a recession in 2020? The American and global economies will experience challenging times ahead with indicators like:

 

Inverted yield curve: The inversion of the yield curve (has already happened), a historical precursor of a recession, has forced the markets to wake up and take stock of the situation. The yield curve is considered inverted when long-term bonds, traditionally those with higher yields, show certain trends.

 

Negative interest in many developed economies: During economic downturns, central banks often lower interest rates to stimulate growth which can go negative also. The notion is that negative rates will provide even more incentive for commercial banks to make loans. There is currently more than $17 trillion in negative yielding debt around the world.

 

A leveraged-asset bubble is building up as the effect that artificially low interest rate has on an economy is pernicious. For corporates, borrowing becomes preferable instead of issuing equity.

 

Trade war turning into an economic cold war over technology as China and America are vying for dominance over the industries of the future – artificial intelligence (AI), robotics, 5G, etc.

 

The Indian economy is experiencing turbulence with the latest GDP at 5.0% (25 quarter low), with slump in growth in various key sectors and the global growth environment gloomy. Many believe that four major disruptions (demonetisation, RERA, trade war and the IL&FS and NBFC crises) and three key economic reforms (GST, IBC and inflation targeting by RBI) led to a drift down in the Indian economy. Stress in NBFCs percolates faster owing to greater interconnectedness (to MFs, banks and the corporate sector), leading to sharp decline in auto and auto-ancillary, manufacturing and MSME, real estate and construction, exports (effect of trade war) and FMCG. There is visible stress in rural areas and agriculture due to drop in income arising out of low food inflation, the weather and the cow crisis. Unemployment is at a 45-year high, income is falling and the savings rate has slumped to 30.5% (37% in 2008), all of which suggest that we in India are in continuing slowdown mode.

 

Milan Sanghani stated that this slowdown could be handled by addressing the ‘demand’ side of the economy, whereas the government has so far brought in measures to address supply-side issues.

 

As regards the USA, he explained that the economy is growing at reasonable pace with unemployment at a 49-year low. Negative rates aren’t fully reflected in actual borrowing and lending rates. Regulations require banks to maintain customer deposit bases. The fear of losing customers dissuades those banks from cutting deposit rates too far. In Europe, only large corporations have faced negative rates. As net interest rate margins (difference between lending and borrowing rates) contract and profits are squeezed, banks raise fees or turn to other revenue measures to boost earnings. This keeps actual borrowing costs relatively high, undercutting the whole point of a negative rate policy. As the economy continues to sputter, central bankers keep on further reducing rates. Government bond yields grow increasingly negative and the yield curve flattens. Banks, which hold substantial amounts of government debt, see their profits decline even further.

 

Rashmin Sanghvi said that government was showing lower fiscal deficit by shifting many items to National Savings (funds of Rs. 16.85 lakh crores) and LIC (assets of Rs. 31.11 lakh crores [US $450 billion], 29 crore policy holders) putting the money of small savers at risk. The main reason for the Indian GDP growth rate falling may be the fear psychosis created by government.

 

LECTURE MEETING ON ‘PARADISE REGAINED…’

 

A lecture meeting was organised by the Society jointly with the Indian Merchants’ Chamber (IMC) and the Indo-American Chambers of Commerce (IACC) on 24th September, 2019 at the Babubhai Chinai Hall, IMC. The guest speaker, Lieutenant-General Syed Ata Hasnain, delivered a talk on ‘Paradise Regained – The Impact of the Momentous Decision of 5th August, 2019’ in light of the resolution passed by the Indian Parliament to abrogate Article 370.

 

Introduction of both the topic and the speaker was done by IMC President Ashish Vaid and IACC President Naushad Panjwani, who also thanked the sponsors of the event, the royal family of Abu Dhabi.

 

Lt.-Gen. Ata Hasnain stressed the need to see the sensitive issue in the historical perspective to understand why mistakes made in the past needed to be corrected to spare India from bleeding. He pointed out that after losing three conventional wars with India, Pakistan which said that for it Kashmir was its ‘existential core’, started engaging in proxy war under the guise of religion. This strategic initiative was launched in 1989 to gain maximum advantage when India was politically unstable, financially weak and socially insurgent. Pakistan, on the other hand, had successfully helped America win the Afghan war against the USSR by providing logistic and strategic support. It had mastered guerrilla warfare and had access to sophisticated weapons which had no state ownership on record. It had the geo-political advantage as it was bordering five different cultures where it could boast of its importance.

 

This proxy war to tire out India and force her to the negotiation table was also backed by psychological propaganda to project alleged violation of human rights of the religious minority in J&K that was aimed at creating a religious chain-link from the Middle East to Kashmir with Pakistan as a central, moderate state. The first phase of what was called terrorism started with mass killings and the subsequent exodus of Kashmiri Pandits from the valley and converting the Sufi culture of Kashmir into a Wahabi culture by bringing hard-core maulanas from UP and Bihar to impart fundamentalist religious training. Thus started a jihadi movement, resulting in several killings that virtually deprived the valley of its moniker of ‘Paradise’ that it so proudly deserved till then.

 

Lt.-Gen. Ata Hasnain then explained how the traditional Indian response over the years was passive, with the country failing to see the larger design by the enemy. India only focussed on killing incoming terrorists and not the system that bred them. It failed to differentiate between terrorists and terrorism. While the terrorist was only a by-product, terrorism was an eco-system that bred, nurtured and supported terror. It involved human resources, logistics, finances and the ideological propaganda machinery. What India needed to do was to target terrorism, the eco-system that was nurtured to inflict damage on India.

 

He also explained how Pakistan had smartly colluded with China by entering into an agreement giving them land in Pakistan-occupied Kashmir for building an economic corridor. This made China also an interested party to the claim for Kashmir. India was getting pushed into an impossible situation and would have lost Kashmir if the historic decision to abrogate Article 370 had not been taken. This action, therefore, was a correction of
past mistakes.

 

However, before this action there had been a lot of strategic planning and several actions had taken place. India, over the last three years, had started attacking the terrorist eco-system and also started a hybrid war to counter Pakistani propaganda. It engaged its army in winning the goodwill of the locals and fortified its borders with increased surveillance. It took the right political pitch by cultivating excellent relations with world leaders and made its economy strong enough to attract the world to her large market. All these actions had won India some brownie points and she had definitely scored some short-term gains evidenced by the fact that there was no major opposition from the world on its action on Article 370. However, in order to convert this into a permanent advantage, what was needed, in the speaker’s opinion, was action on the following points:

 

(1) Stabilise the secular environment by understanding the cultural terrain and by integrating Jammu and
Kashmir valley;
(2) Promote intra-state integration;
(3) Enable effective governance by ensuring that welfare funds and schemes’ benefits reach the lowest section of the people across the terrain; and
(4) Engagement with the hearts of the people, bringing harmony by tactical, strategic and operational support.

 

It is these measures that will make the resurgence of terrorism difficult and ensure long-term gains of the decision taken.

 

Lt.-Gen. Ata Hasnain’s talk was heard attentively by the assembled gathering. After all, he has had vast working experience in Kashmir as a commissioned officer at various levels. In the course of his talk, he also touched upon the way the Indian Army operates and how religion does not come in the way in the working and camaraderie of its troops. While sharing his experiences, he also described different nomenclatures such as Line of Control, Line of Actual Control, International Border, Actual Ground of Line of Control and so on.

 

The meeting attracted a large audience which heard the speaker in rapt attention. The talk was followed by a question and answer session. President Manish Sampat proposed the vote of thanks.

 

‘BAPU@150’ ON 2nd OCTOBER, 2019 AT BCAS CONFERENCE HALL

 

The H.R. Committee of the Society organised a programme on 2nd October, 2019 to commemorate the 150th birth anniversary of Mahatma Gandhi, the Father of the Nation and ‘Bapu’ to everyone. It was styled ‘Bapu@150’.

 

After the National Anthem and the invocation prayer, some members sang bhajans selected from Ashram Bhajanavali (the book regularly used at Bapu’s Ashram) and a few other books. It was truly a ‘recollection’ of Bapu’s personality, faith and values.

 

Music was arranged by Vijay Bhatt, with assistance on the tabla by Mr. Kiran. Members Toral Mehta, Ryan D’Sa, Kartik Srinivasan and Tej Bhatt gave voice to the bhajans and Mukesh Trivedi anchored the programme.

 

After the bhajans, young CA members performed a skit which aimed to connect the younger generation with Bapu’s ideology. It sought to depict how the young generation, with very little or no knowledge about Bapu and his values, often talk about him in a sarcastic tone and without any respect; it went on to show how they were enlightened about Bapu’s virtues and values by two elderly gentlemen sitting nearby and overhearing their conversation.

 

Young members Jigar Shah and Pankaj Singhal wrote, directed and acted in the play. Other actors were Harshal Shah, Raj Mehta, Jekin Dedhia, Jagat Mehta, Tej Bhatt, Dyanesh, Chirag Mehta and Utsav Shah. Nidhi Shah helped them in the backstage and lighting arrangements and Tej Bhatt was responsible for the music. The young members’ creative way to pay respect to Bapu was heartening.

 

In the second half of the programme, keynote speaker Mr. Dinkar Joshi (a well-known Gujarati writer and scholar) shared many anecdotes from Bapu’s life. He highlighted Bapu’s unique qualities of putting into practice what he preached, inspiring others to do the same. He stated that Bapu’s entire life was transparent and that he was one of the greatest thinkers.

 

Welcoming the guests before the keynote address, President Manish Sampat and Chairman Rajesh Muni shared some thoughts on Bapu.

 

The BCAS Journal specially commemorating Bapu’s 150th anniversary on 2nd October was released by the keynote speaker. Editor and past president Raman Jokhakar described in brief the articles covered in the Journal. He also shared Bapu’s inspiring values.
Past Presidents Pradip Kapasi, Shariq Contractor and Mayur Nayak also remembered Bapu with reverence, sharing his inspiring values. Snehal Muzoomdar highlighted that one of the most important contributions of Bapu was to revive music in Gujarat. Mihir Sheth anchored this part of the programme and Krishna Kumar Jhunjhunwala proposed the vote of thanks.

 

The programme concluded with the national song Vande Mataram.

 

INDIRECT STUDY CIRCLE

 

The Hon’ble Bombay High Court recently delivered a very important judgement dealing with the applicability of GST on compensation received for the illegal use of premises. The decision went into the fundamentals of what could be regarded as ‘supply’ under the GST law.

 

Mr. V. Sridharan, Senior Advocate, who was amicus curiae in the said matter, chaired the session. A large number of members and others attended the meeting held at the BCAS Conference Hall on 3rd October, 2019.

 

The subject under discussion was quite elaborate, viz., Bai Mumbai Trust and Ors. vs. Suchitra w/o Sadhu K. Shetty – ‘Implications under GST’.

 

Those interested in the topic had been requested in advance to come prepared in order to ensure active participation. The idea behind the chosen topic was to deliberate and discuss in depth certain important aspects of the subject under GST.

 

Both Group Leader Somesh Jain (Advocate) and Mentor V. Sridharan (Senior Advocate), made interesting presentations and also answered several questions from the floor of the house.

 

The meeting concluded with a vote of thanks to the Group Leader and the Mentor.

 

The Study Circle Conveners are Suresh Choudhary, Chirag Mehta and Dushyant Bhatt.

SOCIETY NEWS

Three-day Workshop, the ‘9th Intensive Study
Course on Advanced Transfer Pricing’, held from
18th to 20th April, 2019 at the BCAS Conference Hall

The 9th Intensive Study Course on Advanced Transfer
Pricing was conducted at the BCAS Conference Hall
from 18th to 20th April, 2019 where nine eminent faculties
conducted the sessions.

The course was aimed at imparting advanced
knowledge on the practical aspects of understanding
and implementing the benchmarking study.
The sessions began with the theoretical aspect
of benchmarking and thereafter delved deep into
identifying the functions performed, assets utilised
and risks assumed by the comparable companies.
They also touched upon the importance of designing
an efficient and effective transfer pricing system and
as to when and how to apply various transfer pricing
adjustments that are defensible before tax authorities
and in court.

The sessions focused on data mining for fact
determination and correct application of adjustments
wherever applicable. All the topics were explained
along with presentations, practical examples and case
studies. International and Indian court rulings were also
discussed. The speakers gave different perspectives
on the current theme – tackling challenges arising
from the benchmarking exercise. The participants were
presented with a hands-on and thought-provoking
approach for determining the right set of comparables
and for making right economic adjustments to arrive at
arm’s length margin. BCAS also arranged for course
play facility that had two participants attending the
course online.

The course was very well received and appreciated by
the participants who felt enriched with the knowledge
shared by the learned speakers.

Lecture Meeting on ‘Important Amendments
Relevant for Audits of FY 2018-19 (Companies
Act, 2013, Accounting and Auditing Standards)’
held on 24th April, 2019 at the BCAS Conference
Hall

A lecture meeting was organised at the BCAS
Conference Hall on 24th April, 2019 covering various key
amendments of the Companies (Amendment) Act, 2017
which need to be addressed for audits of FY 2018-19,
the format of the audit report for audits of the financial
year 2018-19, the impact on revenue recognition under
Ind AS 115, presentation of going concern in the audit
reports, key audit matters and requirements of UDIN.

The learned speaker, CA. Himanshu
Kishnadwala, shared his knowledge
and experience in the most practical
manner on various amendments to
the Companies Act, changes in
accounting standards, intricacies of
reporting requirements and
expectations from auditors and
preparers of financial statements which were well covered and explained with practical examples, to
better explain the complexities of the various changes
in the simplest way.

The lecture meeting was attended by more than 120
participants from various industries and the practice
arena. The interaction between the participants and the
speaker was commendable and the participants said
that they had benefited immensely from the lecture by
CA. Himanshu Kishnadwala.

Full-day seminar on ‘Tax Deducted at Source
(TDS)’ held on 27th April, 2019 at the BCAS
Conference Hall

The Taxation Committee organised a full-day seminar
on TDS on 27th April, 2019 at the BCAS Conference
Hall. The event attracted a full house with an attendance
of about 100 eager participants, including some who
came from outside the city. President Sunil Gabhawalla
made the opening remarks.

The following topics were taken up at the seminar by the
speakers:

CA. Nilesh Kapadia started the
session by highlighting some
practical and important aspects of
TDS. He gave various examples and
case studies to explain and guide the
participants in selecting the best
practical approach in a given situation wherein there are diverse views; he stated that litigation is
not free from doubt. He also provided insights on the
recent changes and the ‘Do’s and Don’ts’ that one should
keep in mind for clients.

Next, CA. Rutvik Sanghvi explained
the provisions of section 195 in depth
and threw light on the checklist to
follow while making remittances
outside India. He also gave his views
on some burning issues and the
approach to take in such situations.

He was followed by CA. Divya
Jokhakar who spoke on specific
issues and a few landmark
judgements. She also explained the
importance of relevant provisions
and circulars impacting real-life
scenarios.

CA. Yogesh Thar dwelt on a different
and new topic under the TDS
mechanism. He spoke about how the
AIF/REITS/INVTS operate and the
applicable tax provisions on them, as
well as in the hands of contributors.
He discussed the background,
advantages and operational challenges with a case study
and summarised the tax impact on the same.

Listing some of the precautions while
E-filing TDS statements, CA. Avinash
Rawani came up with practical
solutions for common inquiries
leading to high-pitched demands. His
approach was to follow the three
“Ds”, that is, Deduct, Deposit and
Declare to avoid any further litigation.
He gave his views on the rights and duties of the taxpayers
for appropriate compliance of TDS provisions and
E-filing. He also highlighted precautions to be taken while
complying with the procedure in each quarter.

The final session was conducted by
Advocate K. Gopal on the penal and
prosecution provisions related to
TDS and some of the recent
measures taken by the government
in this regard. He shared his
experience while dealing with various complex issues and the expectations from the
tax-payers on provisions related to TDS and guidelines
for compounding of offences under direct tax laws.
All the sessions were highly interactive and the speakers
shared their insights on their respective subjects. They
also answered the queries raised by the participants who
benefited immensely from the guidance and practical
views of the faculty.

SUBURBAN STUDY CIRCLE

Meeting on ‘GST – Practical Issues on GST Annual
Return and GST Audit’ held on 4th May, 2019

The Suburban Study Circle organised a meeting on
“GST – Practical Issues on GST Annual Return
and GST Audit” on 4th May, 2019 at Bathiya &
Associates, Andheri East. It was addressed by CA.
Prerana Shah.

The speaker made a detailed presentation on the GST
Annual Return form GSTR-9 and GST Audit Reconciliation
and Certificate in GSTR-9C which was recently released
on the GST portal. Since there were many unresolved
issues and the participants had several practical queries,
the speaker made an effort to address each and every
one of them and explained the form clause-wise and in a
detailed manner.

Apart from this, a discussion was also held on GST audit
where the speaker CA. Prerana Shah deliberated on the
requirements for such an audit. She explained the various
points to be kept in mind (as this is the first year of GST audit) while finalising the GST audit in a time-bound
manner.

The practical examples explaining the form clause-wise
helped the participants in understanding the requirements.

HUMAN RESOURCE DEVELOPMENT COMMITTEE

Study Circle Meeting on ‘Stress Management,
an Art to Healthy Living’ held on 14th May, 2019
at the BCAS Conference Hall

The HRD Study Circle organised this much-needed
meeting on stress management on 14th May, 2019. It was
addressed by Ms Jacqueline Vales.

The speaker explained that of late stress had become part
of our lives. Sometimes, stress could result in a fight, or
in flight, or a person may just freeze, with the energy flow
being blocked. But there are “tapping” techniques that
help release the blockages that cause stress. A majority of
our diseases are psychosomatic. Stress releases certain
chemicals which are harmful for us, making it difficult to
function normally.

Ms Vales also suggested some techniques to relieve
stress that can help to get rid of fear, negativity, anxiety
and depression.

Overall, it was an interesting and enriching experience
for the participants who received some tips on healing
through “tapping” a few points on the body to release
negative energy.

SOCIETY NEWS

INDIRECT TAX STUDY CIRCLE
Indirect Tax Study Circle Meetings on 6th, 24th and
27th December, 2018 at BCAS Conference Hall.

Indirect Tax Study Circle organised three Study Circle
Meetings on 6th, 24th and 27th December, 2018 in which
participants discussed practical approach and various
aspects that need to be kept in mind in GST Audit and
documentation thereof. The discussion was done based
on contents of Annual Return (GSTR-9) and members
broadly covered Part II of GSTR-9C i.e. audit of B2B, B2C
supplies, Exports and Supply to SEZ, Stock Transfers,
Advances, Credit notes and Debit notes etc., for taxable
and exempt outward supplies. The extent of checking and
auditors’ responsibility was also discussed.

The benefit of meeting was also extended to outstation
members by live streaming the sessions. All the sessions
were very interactive and informative and members
participated in large numbers.

“Workshop on Data Analytics for Business and
Audit with Power BI” held on 14th December, 2018
at BCAS Conference Hall.

Technology Initiatives Committee of the Society conducted
a half day workshop on Data Analytics for Business and
Audit with Power BI on 14th December, 2018 at BCAS
Conference Hall.

The session was led by CA. Nikunj
Shah having rich experience in
training and consulting on Data
Analytics for Business Decision
making, Audit and Investigation. He
explained that Microsoft Power BI is
a business intelligence platform that
offers business analytics toolset. It is designed to assist
businesses in their efforts to systematically analyse data.

The Speaker highlighted current limitations of excel
usage and thereby deliberated on the features of Power
BI. He discussed key reasons for shifting to Power BI
applications and gave the demo of Power BI features and
also shared his in depth knowledge on the issues such as
(a) How to analyse data from single and multiple sources
(b) How to create your individual dataset based on
multiple sources and transform your results into beautiful
and easy-to-make visualisations (c) How to share your
results with your colleagues or collaborate on your project
(d) How to make best use of Cloud based features of
Power BI (e) How to generate reports.
The session was highly interactive and the Speaker
resolved all the queries raised by the participants who
benefited a lot and appreciated the efforts put in by the
speaker and group leaders.

Full day seminar on “Estate Planning, Wills &
Family Arrangement/Settlement – Critical Aspects”
held on 15th December, 2018.

The Full day seminar on
Estate Planning, Wills & Family
Arrangement/Settlement – Critical
Aspects was held by the Corporate
and Allied Laws Committee at Indian
Merchants Chamber, Churchgate.
The event was attended by over
85 participants
including more than 10 outstation
participants. President CA. Sunil
Gabhawalla gave the opening
remarks followed by introductory
words from the Chairman of
the Corporate and Allied Laws
Committee, CA. Chetan Shah.

Mr. Nishith Desai gave keynote address explaining
the basic principles of estate planning and how the mechanism to put the same into
effect is changing with increase of
global mobility.

CA (Dr.) Anup Shah explained the
succession laws for Hindus, the
developments in the laws relating
to succession, practical aspects of
creating a will and essential do’s
and don’ts that one should keep in
mind before choosing an appropriate
vehicle for succession planning. He
briefly dwelled upon the FEMA and
other issues that would also merit
consideration in picking the right
vehicle.

Ms. Shipra Padhi gave an insight on
documentation aspects and spoke on
the intricacies of various documents
covered in Estate planning, Family
settlement/arrangements including
Wills.

CA. Pradip Kapasi enlightened
on the taxation aspects of family
arrangements with the help of various
relevant case laws. He discussed
various taxation issues arising out
of family arrangements including
partitions of families, validity of family
arrangements as upheld by Courts
and position taken by the courts in issues arising from
the same. He also touched upon stamp duty implications
arising in such transactions.

CA. Yogesh Thar explained the tax
implications of Trusts and Estate. He
deliberated upon the tax principles
on trusts, HUF taxation and filing of
returns of income of the deceased,
returns of the executors of estate as
also the practical issues arising in
such cases.

With the interactive session and their insights on the
subject shared by the speakers, the participants benefited
immensely. On this occassion BCAS Publications: “Changing
Paradigms of Corporate Social Responsibility in India” and
“Securities Laws-An Introduction” were also released.

TECHNOLOGY INITIATIVES STUDY CIRCLE
Technology Initiatives Study Circle Meeting on
“Zoho Project Management” held on 18th December,
2018 at BCAS Conference Hall.

Technology Initiatives Committee of the Society conducted
a Study Circle Meeting on “Zoho Project Management”
on 18th December, 2018 at BCAS Conference Hall. The
study circle was led by Mr. Eshank Shah, Chartered
Accountant and Chartered Financial Analyst (USA) and
Head of Startup and Transaction Advisory at Banshi Jain
and Associates (BJAA).

CA. Eshank Shah discussed Zoho application and shared
his in depth knowledge with the participants. He also
explained Zoho Application from Planning and execution
stage to capture details of engagements stage including
the benefit of Zoho Application and how to use more
effectively in a business environment. He further resolved
all the queries raised by the participants during the session.
The session was a huge takeaway for the participants
who appreciated the efforts put in by the speaker and
group leader.

Workshop on NBFCs (including IND AS
Implementation Challenges and Regulatory
Updates) held on 21st and 22nd December, 2018.

Accounting and Auditing Committee organised a
workshop on NBFCs on 21st and 22nd December, 2018 at
Orchid Hotel, Vile Parle (East), Mumbai.

The NBFC sector is of late facing several challenges.
Besides the business and regulatory challenges, the
sector is also facing Ind AS implementation (for companies in the 1st implementation phase) challenges and other
compliance challenges of GST etc. Further NBFC sector
is growing at a substantial pace but it is RBI’s endeavour
to ensure prudential growth of the sector, keeping in view
the multiple objectives of financial stability, consumer and
depositor protection and need for more players in the
financial market, addressing regulatory arbitrage concerns
while not forgetting the uniqueness of the NBFC sector.

In view of regulatory norms being notified on a frequent
basis, including Ind AS implementation challenges for
NBFCs and there being changes in Statutory Audit
requirements and various developments in the Taxation
arena, BCAS conducted a Two days’ Workshop on
NBFCs. The Workshop was structured into five sessions
which dealt with important aspects of key regulatory
updates, Issues in IND AS applicability in respect of
Financial Instruments and ECL model applicability,
Statutory Audit Aspects under the Companies Act, 2013,
Disclosure requirement under revised Schedule III and
Taxation Development and issues in
the Direct taxes and GST for NBFCs.

The Workshop started with the
inaugural address by BCAS President
CA. Sunil Gabhawalla, who provided
his view points on the importance of
NBFCs in the overall development
of the financial sector in India. CA.
Himanshu Kishnadwala, Chairman
of the Accounting & Auditing
Committee introduced the structure
of the Workshop.

The first session was commenced
by CA. Bhavesh Vora who lucidly
dealt with the important aspects of
key regulations. While dealing with
the same, he also took participants
through the overall maturing of the
NBFC sector over last three decades
and gave valuable insights on
the regulatory impacts on various
categories of NBFCs.

The second session was dealt
with by CA. Viren Mehta on the
implementation issues of Ind AS
with respect to classification of
Financial Instruments based on the business models and measurement of various Financial
Instruments.

Another session was by CA. Rukshad
Daruvala, who dealt with the important
topic of key issues and requirement
in respect of applying the Expected
Credit Loss Model which deals with
provisioning requirement of Advances
of NBFCs by way of various examples.

Concluding session on Day 1 was
by CA. Sumit Seth, who appraised
the participants with the new
requirements of the schedule III
disclosures including various critical
disclosures required under the Ind
AS regime.

On Day 2, the first session dealing
with Statutory Audit aspects under
the Companies Act, 2013 was
addressed by speaker CA. V. Venkat.
He dealt elaborately with the unique
requirements while conducting
audit of NBFCs and shared his vast
experience with the participants and
explained the importance of Audit
under the current economic scenario.

The second session was taken
up by two speakers: explaining
in detail the nuances of Direct
taxes by CA. Yogesh Thar and
GST requirement by CA. Parind
Mehta. They made the session very
interactive and shared their practical
experience of tax applicability to the
NBFC sector.

   

Before the concluding session,
participants were shown a 45 mins video on practical
Fraud in the industry and had a short discussion on the
same.

Overall the Workshop was an enriching experience for
the participants.

Training Session for CA Article Students on ‘GST
Annual Return’ and ‘GST Audit from Article’s

Perspective’ held on 4th January, 2019 at BCAS
Conference Hall.
The Students Forum under the auspices of HRD
Committee organised a Training Session for CA Article
Students on the above-mentioned topics on 4th January,
2019 at BCAS Conference Hall.

The first session on GST Annual
Return was taken by CA. Raj Khona
followed by a session on GST Audit
by student Speaker Mr. Dynanesh
Patade and CA. Jigar Shah. Ms.
Neelam Soneja, the student coordinator
introduced the speakers for
the session and spoke about various
activities conducted by BCAS Students Forum.

CA. Raj Khona explained the entire Form GSTR-9 clause
by clause and dealt with the various issues / complexities
involved in the annual return form. He highlighted few key
areas which article students should keep in mind while
filing the annual returns.

In the second session, CA. Jigar
Shah in his opening remarks briefly
introduced the topic and gave a brief
insight on various aspects of GST
Audit. Mr. Dynanesh Patade, the
student speaker thoroughly explained
the entire form GSTR-9C and shared
his meticulous detailing in conducting
GST Audit. He also gave useful tips to the article students
on how to effectively conduct GST Audit. The mentor for
the session CA. Jigar Shah then presented the certificate
of appreciation to Mr. Dynanesh Patade and applauded
the meticulous presentation made by him.

With the due dates for GST Audit fast approaching and
every CA firm wanting its articles to be well equipped
with the nitty-gritties of GST Annual return and GST
Audit, the training session saw a record participation
by 150+ students. The session ended with student coordinator
Ms. Neelam Soneja proposing vote of thanks
to the speakers for sparing their valuable time and also
thanked the audience for participating in huge numbers.
Both the sessions were interactive whereby the speakers
answered all the queries raised by the participants.

HDTI STUDY CIRCLE
Study Circle Meeting on “Achieving Cohesiveness
(Like Mindedness) amidst diversity of beliefs
and opinions” held on 8th January, 2019 at BCAS
Conference Hall

Human Development and Technology Initiatives
Committee organised a study circle meeting on the topic
“Achieving Cohesiveness (Like Mindedness) amidst
diversity of beliefs and opinions” on 8th January, 2019
at BCAS Conference Hall which was addressed by Ms.
Amrita Singh having 16+ years of hands on Designing,
Training, and Coaching experience. She explained that
at office or at home, we come across situations where
our opinions and beliefs are diverse and we have varied
goals based on this. We need to align our individual goals
to the organisational goals or like the family as a whole to
successfully work together.

The Speaker took the participants through various
situations and discussed how to deal with the same
successfully. She also mentioned about the types of
personalities and the four quadrants like Kool Blue,
Green Earth, Fiery Red and Sunshine Yellow wherein
each person fall into. Each of these personalities have
typical characteristics and each may also have some
characteristics in the other quadrants as well. One can
judge what quadrant one belongs to and improve to
adjust in order to be successful. The participants found
the topic very interesting and relevant in the day to day
personal and professional life and got hugely enlightened
on the subject.

Lecture Meeting on “Changing Risk Landscape
for Audit Profession with special emphasis on
NFRA and other recent developments” held on 9th
January, 2019 at BCAS Conference Hall.

BCAS organised a lecture meeting on
the captioned subject on 9th January,
2019 at BCAS Conference Hall which
was addressed by CA. Narendra P.
Sarda.
The Speaker discussed about the
‘Changing Risk Landscape for
Audit Profession with special emphasis on NFRA and
other recent developments’ i.e. (i) Increasing Risk and
Challenges, (ii) Specific Scam, (iii) Fraud and Failures,

(iv) National Financial Reporting Authority (NFRA), (v) CA
Institutes’ roles in the new regime and Members response
to the recent developments, (vi) Other regulatory changes
impacting the Audit Profession. Various changes and
increasing uncertainties in the audit profession, increasing
use of Fair values, increasing internal and external risk,
regulatory issue, intricacies of reporting requirements and
expectations from Auditors were also well covered and
explained by way of practical examples well designed
to understand the complexities of the Changing Risk
Landscape for the Audit Profession. On this occassion
BCAS Publication “Tax Deduction at Source- Law and
Procedure” was released.

He also explained the various functions and Powers
of NFRA, companies to whom NFRA applies, NFRA
rules, 2018 and various pros and cons of NFRA. He
further elaborated the role of ICAI and response of the
auditors to this new regulatory authority. The lecture
meeting was attended by more than 100 participants
from various Industries and Practice arena. The meeting
was very interactive and the participants got enlightened
immensely.

FEMA STUDY CIRCLE
FEMA Study Circle Meeting on “Critical issues under
Export/Import of Goods and Services” held on
15th January, 2019 at BCAS Conference Hall

A FEMA Study Circle Meeting was held on 15th January,
2019 at BCAS Conference Hall where CA. Kirit Dedhia
and CA. Parag Kotak led the discussion on the topic of “Critical issues under Export/Import of Goods and
Services”. The Group leaders discussed meaning of
the term “Export” and “Import” in relation to the goods,
software and services. Discussion was also on services
other than software where SOFTEX form is to be filed.
The Group leaders discussed agency commission,
setting off and netting off of export receivables against
import payables, export claims, period of realisation,
reduction of invoice value, write off of export receivables
and few compounding orders. The members appreciated
the efforts put in by the group leaders and learnt a lot from
the rich experience of speakers.

INTERNATIONAL ECONOMICS STUDY
GROUP
International Economic Study Group Meeting on
“Road to 2019 Elections and a Nayi Disha for India”
held on 16th January, 2019 at BCAS Conference Hall

International Economics Study Group had their meeting
on 16th January, 2019 to discuss “Road to 2019 Elections
and a Nayi Disha for India” at BCAS Conference Hall. Shri
Rajesh Jain (studied at IIT, Mumbai & Columbia University,
USA, runs India’s largest digital marketing company,
Netcore) led the discussions and presented his thoughts
on the subject. He presented various scenarios for the
2019 elections, implications of each of the scenarios;
options available to BJP etc.

Mr. Jain also expressed concern about India’s economy
post-election due to atmosphere of uncertainty, voters
opting to change rulers rather than rules to solve
our ‘Hamesha’ problems of poverty, unemployment,
corruption, farm distress, SMEs distress etc. He also
suggested consumption-led growth to propel economy,
employment, reduce poverty, reduce over dependence of
rural population on agriculture etc., by monetising surplus
public assets by returning to the people (rightful owners),
a concept of “Dhan Vapasi”. He also suggested an idea of
relooking at our 70+ years old Constitution.

The meeting was very informative and interactive and the
Speaker resolved all the queries raised by the participants.
The participants learnt a lot from the rich experience of
the Speaker.

SOCIETY NEWS

HOLISTIC HEALTHY LIVING…

The Human Resource Development Committee organised
a Study Circle meeting on ‘Holistic Healthy Living
(Emotional Upliftment Through Healthy Mind)’ on 10th
December, 2019 at the BCAS Hall. The presentation was
made by Dr. Viral Thakkar, MBBS, MD.

Key takeaways from the talk were as follows: A holistic
and healthy life entails harmony between the mental,
emotional and physical states of an individual. Recent
research has started accepting what our ancient scriptures
had proved – that physical health depends on what and
how we think and feel. Hence, maintaining equilibrium
and balance in one’s mental, emotional and physical
constitution leads to an ideal life. If everyone can learn
how to manage stress gracefully, most of the diseases
would not exist. Dr. Thakkar emphasised: ‘Everyone is
capable of achieving optimum health by becoming one’s
own physician.’

The speaker also covered the following concepts:
(i) Psychosomatic fundamentals;
(ii) R ole of emotions and thoughts in maintaining healthy
physiology;
(iii) Brief introduction to Bach Flower Remedies and
handling emotional health;
(iv) A dvance technologies to diagnose emotional and
thought patterns like aura videography;
(v) Lifestyle tips; and
(vi) M editation.

The meeting was well attended and the participants said
they would welcome more such discussions.
Maximising yourself

The HRD Committee organised another Study Circle
meeting on ‘Maximising Yourself by Living a Holistic
Life: Let 2020 be the Beginning of a Defining Decade’
on 14th January, 2020 at the BCAS Hall. The presentation
was made by Mr. Shyam Lata.

The talk provoked the members present to think about
whether they were leveraging the physical, intellectual,
emotional and spiritual fronts of their lives to the maximum
level.

He went on to explain the following:
(a) Physically, some of the essential aspects of life are
exercise, diet and rest; a balance of these helps maximise
our potential;
(b) For intellectual balance, an important aspect is to
filter the information received continuously before arriving
at conclusions. This requires a carefully considered gap
between listening and responding to make the right
decisions;
(c) For emotional balance, an important aspect is to be
assertive – but not aggressive;
(d) For spiritual balance, one needs to practice ethics in
dealings with others.

The speaker summarised these concepts by explaining
Maslow’s Hierarchy of Needs.

ACHIEVING $5 TRILLION ECONOMY

BCAS, along with experts from CCI, organised ‘Experts’
Chat’ on ‘Current Economic Scenario – How India can
achieve US $5 Trillion Economy Target’ at the C.K.
Nayudu Hall, CCI, on 29th January.
Those who participated in the discussion were:
Dr. Ajit Ranade – Group Executive President and Chief
Economist, Aditya Birla Group; Mr. Shyam Srinivasan
– CEO and Managing Director, Federal Bank Ltd.; and
Mr. Dipan Mehta – Stock Market Analyst. BCAS Past
President Shariq Contractor was the Moderator.

At the outset, BCAS President Manish Sampat thanked
the President of the CCI and its Executive Committee
for their co-operation in organising the joint event. He
welcomed the members of both organisations and gave
a brief idea about the activities of the BCAS. He set the
tone for the meeting by narrating the difficult times that
the Indian economy was passing through and hoped that
the experts would enlighten those present about the path
to take to achieve the desired target.

Manish Sampat formally introduced Moderator Shariq
Contractor and then requested Treasurer Abhay Mehta
to do the honours for the experts. After the introduction
of the experts and presentation of mementoes to them, it
was time for the Moderator to take over.

Shariq Contractor set the ball rolling
by first describing the headwinds
and challenges facing the economy
and then said that at the current rate
of growth, in order to achieve a $5
trillion economy India would have to
grow at 11% a year. Was it possible
to achieve this in five years in the
opinion of the panellists? He also wondered whether
the yardstick of consumption-driven growth, which was
the model adopted by the western countries till now,
was valid in view of the changing paradigms in ecology,
environmental concerns and the need for consideration of
the ‘index of human values’.

The panellists were unanimous in their opinion that despite
challenges, it was good to have a goal to propel India in
the desired direction. The challenges of low growth across
the world, the falling Indian agricultural sector putting
pressure on the manufacturing and services sectors and
the depreciating rupee were indeed matters of concern
and could act as a roadblock. However, if there was a
goal followed by action, it could yield the desired result,
if not in the targeted period then at some later time. But
the panellists negated the thought that liquidity was a
roadblock in achieving growth.

According to Mr. Shyam Srinivasan,
the real problem was that investments
were not happening. It was not
a supply problem but a demand
problem that was ailing the economy.
Changing patterns of consumption
and behaviour of the millennials also
needed to be given due consideration
as they did not believe in permanent ownership but useand-
throw, renting and bartering. This was putting a drag
on the economy and the growth rate needed to factor in
this major change.

Mr. Dipan Mehta said that globally, as in India, demand
for institutional finance was reducing as there were many
more avenues of financing available through VC and PE
funding. Besides, orbit-changing business enterprises
were created by ideas that had the potential of catapulting the economy to a very high growth
rate with low seed funding. And there
was enough funding available to
back such ideas.

Shariq Contractor asked whether
chasing the coveted growth rate
posed a risk for India and whether it
could lead to more inequality in the system.

Dr. Ajit Ranade opined that this was
inevitable in the pursuit of growth
because gains from successful
business always went first to the top
order. Besides, some social ills like
pollution, ecological disorders and
environmental hazards were bound
to come as a package along with
growth. However, the wisest thing would be to balance
these factors.

Answering a question on building human capital to
leverage the demographic advantage, Dr. Ranade said
that skill development was indeed a problem and massive
resources were needed to build up the required skill to
achieve the target. In fact, according to the panellists,
more investments would be necessary for investing in
skill-building than plant and machinery or buildings. Mr.
Shyam Srinivasan said that 2% of CSR funds could be
mandatorily made to be spent on skill-building. However,
all panellists agreed that the current level of CSR funds at
Rs. 3 billion might be insufficient to meet the requirements.

To specific questions whether India could afford to follow
a growth model that could potentially compromise the
environment, the panellists were unanimous that it could
only be possible with due balance and ensuring that the
model was financially and economically viable.

One of the critical factors for success in achieving the
desired growth rate and measuring the performance was
the availability of reliable statistical data. The Moderator
asked whether the panellists were convinced about the
reliability of data. They replied that India had a healthy
tradition of maintaining data and the advantage of a wellbuilt
system. They affirmed that GDP metrics did not
leave out any major data in all three sectors. In fact, the
government was consistently trying to improve methods
of data capturing and sampling methods to extrapolate
data in real time for the right decision and direction.

Mr. Dipan Mehta said that the auditors deserved special praise from society for ensuring that corporates presented
their figures accurately. All agreed that India was indeed
following global standards on most parameters for
measuring its progress.

Answering a question about what should one expect from
the forthcoming budget to act as a catalyst for growth,
the response was that no further taxes and greater
transparency by government would be the key.

The chat on targeted issues was followed by a rapid-fire
question round which was well fielded by the panellists.
Overall, the tone was both positive and optimistic about
having a target and working towards achieving it.

INTERNATIONAL ECONOMICS STUDY GROUP

The International Economics Study Group held its meeting
on 10th February on ‘Analysis of Economic Aspect of
Budget 2020’. Shalin Divatia led the discussions and
presented his considered views on the subject.

He first highlighted a few prominent themes of Budget
2020, how the past few years had shaped the budget
(‘Why we are where we are today’) and then dwelt on
some critical highlights of the (then forthcoming) budget.

Clearly, he said, this budget was a continuity of the
approach of the Modi government over the past five
years. During the ten years from 2004-05 to 2013-14,
India consumed by ‘importing’ and Indian corporates
resorted to high leveraging. Heavy external borrowings,
coupled with high fiscal deficit and very high bank credit
growth, had pumped the economy which reflected in the
GDP growth. However, this also resulted in ballooning
inflation and unsustainable PSU bank NPAs, in addition
to the depreciation of the rupee in the forex market.

The Modi government had gone on a systematic and
sustained course-correction to put the economy back on
track with the focus on measures relating to governance
(IBC, use of technology and DBT), strengthing the
economy (review of import duties and rules of origin
under FTA , increase in import duties to protect MSME
and the scheme to encourage electronics goods
manufacturing) and tax reforms (GST had resulted in
lowering of the total indirect taxes). The endeavour
had been to put purchasing power back in the hands of
the common man, promoting ‘Make in India’ for Indian
consumption, to protect / attract manufacturing in India and promote the sustainable competitiveness of the
Indian economy.

Among the prominent themes of the budget were
governance, ease of living (through ‘Aspirational India’,
economic development and a caring society) and the
financial sector. Speaker Shalin Divatia also presented
details of major infra projects announced by the
government to achieve a $5 trillion economy and how the
fiscal deficit is planned to be kept in control in a holistic
manner, including pushing of specific disinvestment cases.

He explained that the Indian economy being very diverse
and with vast inequalities, initiatives that are good from the
larger perspective may negatively impact certain sectors
in the short term. He described how the era of ‘making’
money was over and that with many opportunities, money
would now have to be ‘earned’.

DIGITAL TAXATION

A lecture meeting on ‘Digital Taxation’ was held at the
BCAS Hall on 12th February. Mr. Rashmin Sanghvi, was
the faculty.

He started with an explanation on
how BlockChain has changed the
banking system in India and the
world. He then went on to explain
how the big MNCs of the West such
as Apple and so on are engaged in a
tax war.

The difference between ‘Country of Source’ and ‘Country
of Residence’ was explained with the example of Google
Inc. That, in turn, led to a discussion on how the concept
of PE (Permanent Establishment) is outdated and what
are the current changes that the OECD has brought in.
What happens when the OECD brings in changes and
how do these impact India?

Mr. Sanghvi also elaborated the principles of Base Erosion
Profit Shifting – Action Plans and how these would affect
domestic laws when they were implemented by the nations
accepting them. He described how the term ‘equalisation
levy’ came into the picture and how nations like India and
France had implemented a tax on the digital advertisements
of digital marketing companies which, without a presence
in India, used these to evade taxes.

The erudite speaker explained the changes in the Finance Bill, 2020 which addressed significant economic presence
and also the digital economy, which would bring a change
in the way finance and taxes would work.

It was an upbeat and informative meeting, with the
participants benefiting enormously from the discussions
and the insights provided.

ITF STUDY CIRCLE MEETING

The ITF Study Circle meeting on ‘Amendments of
International Taxation – Finance Bill 2020’ was held on
14th February.

The International Taxation Committee Study Circle
organised this meeting at the BCAS Hall. It was addressed
by Ms Divya Jokhakar.

She began by sharing her personal views on how the
Finance Bill has its pros and cons. She then explained
the reasons for the change in the existing provisions
of section 6 – Residential Status; section 206C – TCS;
and section 94B – Interest Limitation. She led the group
discussion by throwing in several interesting questions,
leading finally to the conclusion that there were still many
doubts and queries which the Finance Bill would be able
to answer when it was made into an Act.

Divya Johkakar’s Excel workings on how to claim tax
credit in the event of an individual turning into a deemed
resident of India, and also the workings of disallowance
u/s 94B, were well received.

‘10X SUCCESS AND PRO SPERITY MINDSET’

The Human Resources Development Committee
organised a Study Circle meeting on 17th February at
the BCAS Hall to discuss the subject ‘10X Success
and Prosperity Mindset’ which was conducted by
Mr. Arunaagiri Mudaaliar.

He explained that what a human being achieves in life
depends on his mindset. And mindset comprises of
beliefs and attitudes that can be fine-tuned for success
through effective training. Dr. Arunaagiri is a master in
helping individuals convert their beliefs and attitudes into
liberating, empowering beliefs and mindset to achieve
holistic prosperity in life.

In the ‘10X Success and Prosperity Mindset’ seminar,
the participants got first-hand information on the subject.  Some of them claimed that they had experienced an
uplifting and positive feeling and enhanced energy at the
end of the seminar.

ANAL YTICS & AI – A GLO BAL PERSPECTIVE

A lecture meeting on ‘Analytics and AI – Global
Perspective and India Story’ was held on 20th February
at the BCAS Hall.

President Manish Sampat gave the opening remarks
and presented an overview of the seminar by explaining
the importance of Artificial Intelligence (AI). He also
introduced both the speakers, Mr. Jeffery Sorensen and
Deepjee Singhal.

Mr. Jeff Sorensen started the
session by highlighting various
points to be kept in mind at the time
of auditing and briefly described the
global perspective on audit analytics
and AI by listing the following points:
(i) Artificial Intelligence definition
(ii) Global development
(iii) T he audit perspective
(iv) A udit AI in practice
(v) H ow you can get started

‘AI is the branch of computer science concerned
with the automation of intelligent behaviour. AI is the
computational ability to achieve goals in the world,’
he said, before going on to describe some common
AI terms and concepts. He then explained Machine
Learning – which is a subset of AI – and a mathematical
model based on sample data.

He also described some key challenges for AI and global
development, which is a combination of faster computers
and smarter techniques. He described the global progress
on AI with examples from the fields of finance, healthcare,
automotive, retail, airlines / travel, security, lifestyle and
so on.

Further, he explained Audit Perspective, which applies
to audit – Automation and Robotic Process Automation
(RPA); audit apps; machine learning / deep learning for
auditors; goals of RPA; features of RPA and tasks for
RPAs; standardised, rule-based repetitive and machinereadable
inputs; and so on.

Considering the time limitation,
Deepjee Singhal, a member of the
BCAS Core Group, gave more time to
Mr. Sorensen to share his
experience.

In the limited time available to him,
Deepjee Singhal provided a brief
update on ‘the India Story’ and on Analytics and AI in the
context of internal audit.

He explained the future of Analytics and AI in India
and asserted that AI had a bright and promising future.
Further, he described, with examples, the presence of
AI in government, automotive, finance, restaurants,
etc. He also explained some key points of AI such as
the development of AI in India through auditing, audit
analytics, etc.

Both sessions were interesting and interactive. The
meeting was well attended and attracted a full house.

WOR KSHOP ON UNDERSTANDING MLI

A two-day workshop on ‘Understanding the MLI’
(Multilateral Instrument) was organised by the BCAS
at Hotel Orchid in Mumbai on 21st and 22nd February. The
objective of the workshop was to offer participants indepth
understanding of the MLI and its impact on Indian
tax treaties going forward.

The seminar received tremendous response with 112
participants of all generations, both members and nonmembers,
as also outstation participants from 16 cities
across India.

Manish Sampat, BCAS President, welcomed the
gathering and made the opening remarks. Dr. Mayur Nayak, Chairman of the International Tax Committee,
introduced the subject.

In the first session on Day 1, Mukesh Butani lucidly
explained the architecture of the MLI along with its basic
concepts, terminology and nuances in light of the BEPS
project of the OECD and its ‘Action Report 15’. His
presentation provided an insight into Part I of the MLI,
i.e., Article 1 (Scope of MLI) and Article 2 (Interpretation
of Terms). The session was chaired by BCAS Past
President Kishor Karia.

On the conclusion of the first session, the BCAS
publication, ‘Multilateral Instruments [MLI] (including an
overview of BEPS) – A Compendium,’ was launched by
BCAS Past President Pinakin Desai.

The day’s second session saw
Vishal Gada providing insights
into Part II of the MLI dealing with
hybrid mismatches. The case studies
presented by him provided practical
understanding to the participants
of the issues which are sought to
be tackled by the MLI and also the
issues that could possibly arise from its interpretation.
His presentation covered Article 3 (Transparent Entities),
Article 4 (Dual Resident Entities) and Article 5 (Application
of Methods for Elimination of Double Taxation) of the MLI.
This session was chaired by Dr. Mayur Nayak.

In the third session of
Day 1, Radhakishan
Rawal provided insights
on Part VII of the MLI
(Final Provisions), dealing
with how the MLI will be
interpreted, implemented,
amended, will enter into force, will enter into effect, relate to the protocols, etc.
His presentation covered Articles 27 to 39 of the MLI. The
session was chaired by Nilesh Kapadia.

The last session
of the day had H.
Padamchand Khincha
dealing with Articles
12 to 15 of the MLI,
which pertain to artificial
avoidance of Permanent
Establishment (PE)
status in light of BEPS
Action Report 7. He also enlightened the participants on
the amendments to the concept of ‘business connection’
proposed by the Finance Bill, 2020 and its impact on the
taxation of foreign enterprises operating in India through
digital means. Daksha Baxi chaired this session.

On Day 2, the first
session saw Geeta
Jani taking the stage
and enlightening the
participants about the
intricacies and nuances
of Articles 6 to 11 of the
MLI dealing with Treaty
Abuse in the backdrop
of BEPS Action Report 6. The case studies covered in
her presentation inter alia not only highlighted the various
issues that are expected to arise under Article 6 (Purpose
of a Covered Tax Agreement) and Article 7 (Prevention
of Treaty Abuse) of the MLI, but also provided possible
solutions and interpretations to deal with these issues.
This session was chaired by Tarunkumar Singhal.

In the second session on Day 2, Dr. Vinay Kumar Singh,
IRS dealt with the very important topic of synthesised texts of Indian tax treaties (post-MLI) issued by the Indian
tax authorities. His presentation provided insights into
the approach of Indian tax authorities to the MLI, the
non-binding nature of the synthesised texts and how the
same are expected to enhance the ease of interpreting
the MLI, which can otherwise be a daunting task. This
particular session was chaired by Anish Thacker.

The two-day workshop concluded
with a panel discussion on case
studies under MLI featuring Dr. Vinay
Kumar Singh, IRS, Sushil Lakhani
and Vispi Patel acted as panellist
and Moderator, respectively. Thanks
to their expert knowledge and rich
practical experience, they dealt with
the complicated issues arising in
the case studies and provided allround
inputs and arguments from
the perspective of both the taxpayer
and the tax authorities. The case
studies were prepared by Ganesh
Rajagopalan, Bhaumik Goda and
Karnik Gulati. They were guided and provided with
valuable inputs by Vispi Patel.

All the sessions were interactive, with the speakers
sharing their insights on their respective subjects and
issues. The participants benefited immensely from their
guidance and practical views. The Coordinators for the
workshop were Namrata Dedhia, Tarunkumar Singhal
and Abbas Jaorawala.

INTERACTIVE SESSION WITH STUDENTS

The BCAS Students’ Forum, an initiative of the HRD
Committee, organised an interactive session with
students on the subject ‘“Success in CA Exams’” on 23rd
February at RVG Hostel, Andheri (West), Mumbai.

The event was attended by Mr. Lalchand Choudhary (President, RVG Hostel), Mr. Rajesh Muni (Chairman, HRD Committee – BCAS), Mihir Sheth (Hon. Joint Secretary – BCAS), Narayan Pasari (Past President – BCAS) and Anand Kothari (Convener, HRD Committee – BCAS).

Ms Azvi Khalid (student co-ordinator) introduced the speakers, Dr. Mayur Nayak and Ashutosh Rathi, and shared brief details about the BCAS Students’ Forum. Rajesh Muni addressed the students and encouraged them to actively participate in the events organised by the Students’ Forum. Mr. Lalchand Choudhary was delighted to share students’ activities at RVG and said that he would be very happy to conduct more such programmes jointly with the BCAS for the benefit of the CA students’ community. Mihir Sheth and Narayan Pasari also motivated the students with words of encouragement.

Dr. Mayur Nayak shared his own inspiring journey as a CA student who failed to crack the final exams in the first attempt and thereafter secured an All-India Rank with his sheer determination, hard work and positive attitude. He focused on the ways to mentally prepare for the exams and how to accept failure. He gave tips to calm the mind while attempting the papers; and, while studying for the exams, learning a few deep breathing techniques. He explained that the biggest danger faced by students was not in setting their aim too high and falling short, but in setting their aim too low and achieving their mark.

Ms Drishti Bajaj (student co-ordinator) urged students to participate in the forthcoming Jal Erach Dastur CA Students’ Annual Day event, popularly known as ‘Tarang’ which offered an excellent platform to CA students to showcase their talent.

The second speaker of the day, Ashutosh Rathi, who has vast teaching experience, emphasised the importance of staying time-conscious; to ensure that they did not get distracted; he suggested maintaining a ‘Mission Chartered Diary’ creating a plan for the next day before going to sleep and logging hourly performance marks.

At the end of every day, the student needs to do selfanalysis and ask three Golden Questions to himself:
1) What worked?
2) What did not work?
3) What is the improvement plan for things that did not work?

Planning and time management played a crucial role in getting the best ROI on the time invested. A good and realistic plan kept the student focused, sorted and in charge. He also shared a six-step approach:

Step 1: A sk the Golden Question
Step 2: Zero-Based Budgeting – Subject-wise and
Chapter-wise Time Estimates
Step 3: Subject Scheduling (Macro)
Step 4: Week Scheduling
Step 5: D ay Scheduling
Step 6: Fortnightly Refinement

Ashutosh Rathi pointed out that planning was a dynamic process. Often, the target may not be accomplished for various reasons and it would require the student to refine his plans to make up for the lost time; for this it was best for the students to spend 30 minutes every two weeks to refine their strategy.

At the end of the session, he shared the inspiring story of Ms Rajani Gopala, India’s first visually impaired woman who achieved the milestone of becoming a CA by transforming her weaknesses into strengths and sympathy into empathy by sheer determination, hard work, planning, focus and perseverance. He also offered practical tips and tricks to be implemented to qualify as a CA and provided students with powerful affirmations to stay self-motivated.

Finally, Mr. Vedant Satya (student co-ordinator) briefed the participants about the forthcoming BCAS events and thanked the speakers for sharing their knowledge.

VIVAD SE VISHWAS

BCAS Past President Gautam Nayak chaired the Direct Tax Laws Study Circle meeting on the ‘Vivad se Vishwas’ Bill, 2020, at the BCAS Hall on 24th February. Advocate Devendra Jain was the Group Leader.

Devendra Jain gave a brief overview of the objects of the Bill and the reasons for its enactment. The cases in which the scheme will be applicable, along with important definitions, were discussed in detail. Cases wherein the declaration would be considered inapplicable were highlighted.

All the aforesaid points were discussed in light of the amendments to the Bill, which were passed on the day of the meeting.

Chairman Gautam Nayak gave practical insights on various issues from time to time in the course of the meeting. Both he and the Group Leader took questions from the floor throughout the session.

INDIRECT TAX STUDY CIRCLE

The Indirect Tax Law Study Circle held its meeting on ‘Issues concerning the applicability of section 50, rule 86A and section 43A of the CGST Act’ at the BCAS Conference Hall on 2nd March. More than 40 members attended the meeting.

The Group Leader and session chairman provided insights on the topic with wide coverage and gave a detailed analysis on it. He also answered many of the doubts raised by members. It was an interesting and interactive meeting which concluded with a vote of thanks to the Group Leader and the Mentor. On a demand from the members, it was decided to hold a continuation of the same meeting at a later date.

SOCIETY NEWS

TALK ON ‘ACHIEVING SUCCESS – LIVING VALUES’

The H.R. Committee, along with the RVG Educational Foundation, organised a talk for the benefit of students and young members on 24th November, 2019 at the RVG Hostel Auditorium. Mr. M.K. Ramanujam addressed the gathering on ‘Achieving Success – Living Values’ in his eloquent style and in an interactive session.

He started his talk by explaining the difference between success and happiness. Success, he said, invariably refers to targets, milestones, goals, etc. But happiness is born out of love, abundance and inspiration. Therefore, one ought to choose to do something out of inspiration and love for a subject, for a career, for one’s dreams and so on. ‘Success’ is a challenge because it is short-lived. One often postpones happiness till one achieves success. Happiness, on the other hand, flows from inspiration during the process of achieving it; and despite the challenges, one remains cheerful.

Mr. Ramanujam explained the acronym ‘PREMA’ and the most important concept of ‘Purpose’.

‘P’ Stands for positive emotions. One must venture out with positive emotions. Negative emotions are like Velcro that gets fixed to us easily. We should not be like Velcro but like a Teflon coating so that we are not stuck to negative emotions. For a daily practice of positive emotions it would be best to remember and note down at least three nice things that happened during the day and objectively assessing why these felt like positive happenings.

‘R’ Stands for Relationships. One must invest time, effort, energy and willingness in building relationships with nature, friends, teachers, seniors, the environment and everything around. They are the best support systems.

‘E’ stands for Engagement. Give your best. Introspect and ask yourself, why are you doing what you are doing? Put all your energy into whatever you are doing. Even if you are compelled to do certain things that you do not want to do (e.g., due to parents’ pressure), put in your best. Love what you do and do what you love. Put your 100% and think beyond your own self. Think what contributes to your happiness… Expand your horizon.

‘M’ stands for Meaning. In all that you do, you ought to have meaning for the self and for all those concerned
with it.

‘A’ stands for Achieving. You must complete what
you have begun. There is joy in finishing and
achieving things.

Purpose: Everything in the universe is driven by purpose. Align your work with the purpose. Clarity of ‘Why’ lightens the burden of ‘How’ and ‘What’. Purpose can be understood with deep introspection with ’Why’ and values can be understood by questioning ‘How’. Success is what others measure in you and happiness is what you measure in yourself.

One hundred and ten participants, including more than 80 students, attended and enjoyed the talk.

President Manish Sampat welcomed the participants and gave information about the Society and also shared its vision. Chairman Rajesh Muni provided a broad outline of the activities of the H.R. Committee, especially those carried out for the benefit of students. He invited and encouraged students to register and participate in the Study Circle and the Students’ annual programmes which enable students to showcase their talents.

Mr. Lalchand Chaudhari, President of the RVG Foundation, shared information about the number of chartered accountants who had benefited as alumni of the hostel. He also shared the ‘Vision 2024’ plan set out for RVG. Mukesh Trivedi proposed the vote of thanks.

WORKSHOP ON NBFCS

The NBFC sector has been facing several challenges of late. Apart from business and regulatory challenges, it is also confronted with challenges in Ind AS implementation and other compliances of ECL provisioning and disclosure, etc. Further, regulatory norms are also being notified on a frequent basis.

The Accounting and Auditing Committee of the BCAS has always been at the forefront in planning programmes for NBFCs in order to bolster them and to equip professionals to deal with challenges. Accordingly, the Committee conducted a ‘Workshop on NBFCs’ on 13th December, 2019 at Hotel Orchid, Mumbai to have an in-depth discussion on the current developments in the field from the regulatory perspective and various issues arising from first-time Ind AS implementation.

It was structured into five sessions followed by a panel discussion. The technical sessions dealt with a variety of topics such as Key regulatory updates in the NBFC Sector, Financial Instruments, Applying the ECL Model and related disclosure requirements, Disclosure requirements under Schedule III of the Companies Act, 2013, Statutory audit aspects, followed by an interesting panel discussion on Challenges of first-time adoption of Ind AS.

The Workshop was attended by more than 80 persons, with increased participation from the industry.

The Workshop started with an inaugural address by Samir Kapadia, BCAS Hon. Joint Secretary, who stressed the importance of NBFCs in the overall development of the financial sector in India. Himanshu Kishnadwala, Chairman of the Committee, introduced the structure of the Workshop to the participants, the thought process behind its design and the need for such a Workshop.

The first session was conducted by Bhavesh Vora who dealt with the important aspects of key regulations surrounding NBFCs and the recent changes therein. While dealing with these, he also took participants on a journey of the NBFC sector over a period of time and gave valuable insights into the regulatory impact on various categories of NBFCs.

In the second session, Santosh Maller dealt with Financial Instruments, Classification of Financial Instruments based on the business models and the measurement of various Financial Instruments with several examples for ease of understanding.

Rukshad Daruvala, who conducted the third session, took up the key issues and requirements in applying the Expected Credit Loss (ECL) model dealing with the provisioning requirements of Advances of NBFCs.

Post lunch, Rukshad Daruvala was once again at the helm, at the session on Disclosure Requirements under Schedule III, including various critical disclosures required under the Ind AS regime.

The subject of Statutory Audit aspects was dealt with in the fifth session by Jayesh Gandhi. He discussed in detail the requirements while conducting audit of NBFCs and shared his vast experience with the participants as
he explained the importance of Audit in the current economic scenario.

In the final session, the challenges of first-time adoption of Ind AS were discussed by a panel comprising Govind Jain, Jayesh Gandhi and Haren Parekh. The discussion was ably moderated by Ashutosh Pednekar. It revolved around the first-time adoption challenges faced by the NBFC industry and the auditors’ perspective on the same. The panellists shared their practical experience on the subject for the benefit of all participants.

TRAINING SESSION FOR CA ARTICLE STUDENTS

The Students’ Forum under the auspices of the H.R.D. Committee organised a training session for CA article students on ‘Recent Developments in Income Tax’ on 10th January, 2020 at the BCAS Hall.

It was conducted by Jayna Shah. Ms Dhristhti Bajaj, the student coordinator, introduced the speakers and described the upcoming events for students.
Anand Kothari, Convener of the H.R.D. Committee, welcomed the speakers and presented them with a memento each.

Jayna Shah explained the various amendments in income tax such as the change in the corporate tax rate, introduction of faceless assessment, changes to boost cashless economy, new provisions and amendments in TDS provisions and so on. It was an interactive session and the speakers answered all the queries raised by the participants.

The training session ended with Student Study Circle Coordinator Dnyanesh Patade proposing the vote of thanks to the speakers and also to the participants.

NANI PALKHIWALA MEMORIAL LECTURE

The Nani Palkhiwala Memorial lecture meeting was organised jointly with the Forum of Free Enterprises at NCPA Tata Theatre on 16th January, 2020.
Mr. N. Chandrasekaran, Chairman of Tata Sons Ltd., who was the guest speaker, dwelt on the subject ‘Building India for the Future’. Mr. Y.H. Malegam presided over the proceedings.

A documentary film, ‘Nani the Crusader’, was screened at the start of the meeting. It was based on the life of the late Mr. Nani Palkhiwala and showed glimpses of his life, his rise in the legal fraternity and the accolades that he won from all quarters on account of his brilliance. It also threw light on some of the major cases on Constitutional matters that he had won and that saved India’s democracy and shaped the country’s future.

The film screening was followed by the release of a book, ‘Essays & Reminiscences’ in honour of Mr. Palkhiwala. Mr. Arvind P. Datar, the general editor of the book, fondly recalled his vivid memories of the late stalwart.

Mr. Chandrasekaran spoke of suspicions and ‘micro-management’ of the economy as the impediments faced by businesses in India. He stressed on the need for creating a harmonious atmosphere by trusting and treating business as an essential pillar for
nation-building. The Tata group was an excellent example of how business can contribute to nation-building. Mr. Palkhiwala had set an example of how businesses, by maintaining their core values, could co-exist in a competitive economy and had helped government to build the present-day India. This happened because even his strictest criticism was taken in a positive spirit and with implicit trust by the government.

The core thrust of Mr. Chandrasekaran’s speech was how, with the co-operation of business and government, the vast potential of India could be tapped and the benefits of growth could reach the poorest segment of people to build a strong India, making its future
extremely bright.

Mr. Deepak Parekh, HDFC Bank Chairman, while proposing the vote of thanks, called for maintaining the values of the Indian Constitution. Pointing out that ‘while times and circumstances change, strong values and principles do not’, he said that while we should hold on to the learnings that Mr. Palkhiwala had left behind, it was important not to be consumed by ‘pessimism and doom-mongering’. Admitting that he was an optimist, he said he was confident about the future of India and that ‘our youth will see India’s best days’.

SEMINAR ON PRESUMPTIVE TAXATION

The Taxation Committee organised a seminar on ‘Presumptive Taxation’ with several distinguished speakers sharing their deep knowledge on the subject. It was held at the Walchand Hirachand Hall of the IMC on 18th January, 2020. The event attracted overwhelming response and saw an attendance of 111 participants, including outstation participants from five different cities / towns. President Manish Sampat welcomed the attendees and gave the opening remarks.

The following topics were taken up for discussion by the speakers:

Sections 44AD and 44ADA: – • Purpose of the provision • How is it different from section 28 – 43CA • Assessee to offer business income under this section • Assessees who cannot offer income under presumptive taxation • Maintenance of books of accounts• Calculations of gross receipts• Determination of GR without BOA and case studies Bhadresh Doshi
Sections 44AE, 44AF, 44BB, 44BBA, 44BBB – Purpose of the sections, applicabiltity, issues, recent jurisprudence – Interplay of tax audit – Case studies Mehul Shah
Brain trust questions – Presumptive taxation issues –Issues concerning return of income, books of accounts, tax audit, assessments, penalties, ICDS, etc. Gautam Nayak,
Anil Sathe and Kinjal Bhuta

In the first session, Bhadresh Doshi highlighted the technical aspects of sections 44AD and 44ADA. He concentrated on various issues arising right from the time of the introduction of the presumptive taxation scheme under these two sections. He gave his views and insights on multiple issues and explained the jurisprudence affecting them. He advised participants to read and understand the section and scheme and not to rely on general perceptions.

On his part, Mehul Shah dwelt on the presumptive basis of taxation under sections 44AE, 44AF, 44BB, 44BBA and 44BBB. He explained sections with the help of case studies. It was a highly interactive session and the speaker answered all the questions posed by the participants.

Gautam Nayak, Anil Sathe and Kinjal Bhuta were the ‘brain trustees’ for the last session that was moderated by Ameet Patel. The ‘brain trustees’ were allotted specific questions based on various issues raised by BCAS members from time to time.

Starting the session, Gautam Nayak gave his views on whether presumptive taxation provisions under sections 44AD and 44ADA are qua assessee or qua income. He also responded to various issues raised by the participants pertaining to sections 44AD and 44ADA.

Anil Sathe gave his views on fundamental issues concerning the presumptive basis of taxation and responded to questions based on real examples. He also gave his views on issues concerning sections 44AE and 44BB.

Finally, Kinjal Bhuta shared her insights while addressing questions relating to important definitions such as eligible business, etc. under the presumptive basis of taxation. She also elaborated on the overall scheme and answered queries related to return of income for assessees adopting the presumptive basis of taxation.

All the sessions were interactive and the speakers shared their insightful views. The participants benefited immensely from the guidance and practical views on various issues offered by the faculties.

NFRA AND PCAOB – DISSECTING

PERFORMANCE EVALUATION OF AUDITS

A lecture meeting was organised on 22nd January, 2020 in the BCAS Conference Hall to deal with the above topic. It was addressed by Chirag Doshi who went through the process of inspection by the Public Company Accounting Oversight Board (PCAOB) of a firm’s quality controls and review of audit assignments carried out by that firm.

He provided an overview of the functioning of the PCAOB with its top areas of focus during the exercise of a firm’s quality review process. The major focus areas were:

(i)   System of quality control in firms;

(ii)   Independence;

(iii) Recurring audit deficiencies relating to ICFR, Revenue Recognition, Allowance for loan losses, Other Accounting Estimates and ROMMs.

The review process is split into two parts, viz., Quality Control Review and Audit Engagement Review. The major focus is on compliance with auditing standards and not the accounting standards.

Chirag Doshi dwelt on the on-field procedure for review as well as the procedure after field reviews and highlighted the thorough professionalism and independence involved in the whole review process.

He then dealt with the National Financial Reporting Authority (NFRA) which has been constituted on the lines of the PCAOB with the objective of monitoring and enforcing compliance with auditing standards. For achieving this objective, the NFRA would be reviewing the working papers of the audit firms and other communication related to the audits to evaluate the sufficiency of the quality control system of the auditor.

Chirag Doshi went on to deal with the first report of NFRA in the form of an Audit Quality Review (AQR) Report in the case of the auditee, ‘IL&FS Financial Services Limited’ for the F.Y. 2017-18. The purpose of discussing the findings was to make the members aware of the necessity to document and to put on record the findings during the audit process in such a manner that it goes on to prove the independence of the auditor as well as displaying adequate professional scepticism during the conduct of the audit process.

He provided inputs for creating an in-house audit manual by small and medium-size firms for the efficient conduct of audit.

The meeting was well attended and attracted a full house.

FEMA STUDY CIRCLE

Here is a brief report on the FEMA Study Circle meeting held at the BCAS Conference Hall on 23rd January, 2020.

Ms Mitali Pakle’s presentation was comprehensive and lucid in nature and covered a variety of case laws that made it easy for everyone to grasp the subject matter being discussed. In the course of her brief talk, the speaker managed to cover various aspects of the ECB Guidelines and made it quite interesting.

The discussion was further enriched by some thought-provoking questions that the participants posed and the answers provided by the speaker.

DTAA COURSE 2019-20

The 20th Study Course on Double Taxation Avoidance Agreement was conducted at the BCAS Hall over nine days – 13th, 14th, 20th  and 21st December, 2019 and 4th, 5th, 11th, 12th and 25th January, 2020.

Thanks to regular feedback and continuous refinement, the Study Course was re-designed and covered all BEPS and MLIs along with the Articles of DTAA, FEMA / GAAR, Transfer Pricing, Source Rules under the Income-tax Act, 1961, TDS u/s 195, Substance vs. Form and other relevant provisions.

All the lectures delivered by 31 eminent faculties were very well received. The faculties were generous in sharing their experience by way of case studies on critical topics such as residence and PE, as well as the amendments sought to be made through the MLI.

The Study Course was attended by 73 participants from diverse backgrounds such as senior professionals, practising CAs, young professionals associated with big and SME accounting firms and so on. Apart from Mumbai, there were registrations from other cities such as Ahmedabad, Baroda, Chennai, Jaipur and Delhi. All of them contributed to making the course a huge success.

For those who came in late, the Study Course is an eagerly-awaited event amongst the practitioners of international taxation from all over the country and was well received and appreciated. It was coordinated by Maitri Ahuja and Mahesh Nayak.

‘INDIAN PRIVATE TRUSTS – TAX AND FEMA ASPECTS’

The International Taxation Committee arranged a meeting on ‘Indian Private Trusts – Tax and FEMA Aspects’ on 28th January, 2020 at the BCAS Conference Hall. The meeting was led by Group Leader Naresh Ajwani who explained the far-reaching income tax and FEMA implications in case of trusts.

The speaker walked the audience through the provisions of income tax and FEMA on trusts and explained various basic terms, the genesis of trusts, kinds of trusts, ownership of trust property, AOP / BOI taxation, beneficial interest, beneficial ownership and other provisions. With the help of some simple illustrations, he explained various concepts and particulars – including terms that do not exist in Indian law such as ‘Trust is not a person’, ‘Grantor Trust’, ‘Trustee taxable as Representative Assessee’ and so on.

Naresh Ajwani also dealt with and answered queries raised by members of the audience. The meeting was interactive and the participants received enormous benefit from the discussion and the insights provided.

Acknowledging the importance of the subject, the Committee plans to host another meeting on trust provisions, details of which will be shared with members very soon.

FELICITATION OF YOUNG CAS AND ‘VISION 2020 – SHAPING THE FUTURE’ FOR NEWLY-QUALIFIED CAS

A special programme was organised for the newly-qualified Chartered Accountants (emerging successful from the November, 2019 examination) under the aegis of the Seminar, Public Relations and Membership Development (SPR&MD) Committee. But within a few days of the announcement, the online enrolments crossed the record figure of 300, forcing BCAS to close registrations!

The event was held at the BCAS Hall on Friday, 31st January, 2020. It attracted a full house of over 190 participants, including some walk-ins. They were greeted at the registration desk with a few BCAS publications – ‘Changing Paradigms for CSR in India’, a ‘Monograph Series’ containing five booklets on various laws, a copy of the BCAJ Journal of the last two months and BCAS membership forms.

The evening started with a one-on-one interactive session focussed on mentoring with eminent mentors, Nandita Parekh and Robin Banerjee. The participants were divided into two groups between the speakers so that they could interact and take help from them on all their queries, including guidance for future careers. These sessions were appreciated by all the newly-qualified CAs.

This was followed by an address by President Manish Sampat who talked about his early days as a qualified Chartered Accountant, the sound advice that he had received from his seniors to associate himself with the BCAS, the positive impact that the Society had had on his career as a CA – and to the present day when he heads the Society as President. He also briefed the new CAs on the various initiatives of the Society.

Narayan Pasari, Chairman of the SPR&MD Committee, pointed out that the youth or ‘yuva shakti’ is an integral part of the numerous activities organised by the BCAS. He appealed to the new CAs to become members of BCAS, benefit from it and play an active role in its innumerable activities. He pointed to the BCAS Referencer, the Annual RRC and the other programmes conducted in the last few months and said that youth had contributed significantly in all these events.

He proudly revealed that the BCAS is very active on social media and its handle @BCASGlobal has recently crossed the 33K mark; it also has 11K followers each on LinkedIn and YouTube.

The ‘Thought Leader’ for the evening, Nilesh Vikamsey, then took the floor and offered valuable advice to young CAs from the variegated learnings of his own life. He spoke at length on upcoming fields for CAs and stated that he believes ‘ABCD is the future’ – that is, Artificial Intelligence, Block Chains, Cyber Security and Data Analytics.

He also answered all the questions posed to him by the newly-minted CAs. He advised them to join the nearest Study Circles and pointed out that at an association like BCAS, the process of learning never stopped.

This was followed by a felicitation ceremony, with all the participants being presented with a memento by ‘Team BCAS’. The event showcased the vibrancy of the participants, many of whom showed great interest in signing up to become members of the Society.

Interestingly, some of the participants were eager to ask even more questions to their Mentors. The proceedings ended with a vote of thanks proposed by the coordinator, Rimple Dedhia.

18TH RESIDENTIAL LEADERSHIP RETREAT

The 18th Residential Retreat programme was held on 7th and 8th February, 2020 on the theme ‘Future Begins Now’. Twenty-nine participants, including ten newcomers, had registered for the programme. The trainer, Mr. Deepak Shinde (a disciple of Shri Mahatria), had flown in from Bengaluru for the event.

A cool winter breeze flowing over the green, serene and spacious campus, amidst the shade of swaying trees and the chirping of birds, set the perfect tone for the Retreat, which was held at the Rambhau Mhalgi Prabodhini, Essel World Road, Uttan.

The programme commenced with the invocation prayer. President Manish Sampat welcomed the participants and shared information about the activities of the BCAS. He proudly narrated his journey at the Society which had begun many years ago as Convener of the Human Resource Committee. He complimented the participants and the organising team for devising such an interesting workshop.

Trainer Deepak Shinde discussed several important concepts and pointers of life with the participants over the two-day Retreat.

He opened with the story of Alexander the Great King and the Saint Diogene, driving home the point that to become king or to achieve something, one has to put in huge efforts. But to be like Saint Diogene (and in permanent bliss) one need not depend on external things. One can be in that state quite naturally. To be happy, one must adhere to right values. One can be an achiever, become successful and also remain blissful like a saint.

His advice was to always begin the day with the greeting ‘Happy Morning’. Doing this all 365 days of the year would turn it into a habit. And one would not need to depend on people, places, objects, time, or seasons to be happy. If one was dependent on such external factors, the happiness would be temporary and external factors would make one subservient and vulnerable to them.

‘We have a tendency to judge people with our own biased and limited vision. In doing so we miss to be in touch with people and miss happiness. One’s life must be full of happiness and love, such that the epithet on one’s grave describes one’s life with apt, inspiring and happy words.’

In the second session, Trainer Deepak Shinde spoke about perfect balance and alignment of the laws of nature and man’s tendency to interfere. He used the simile of a Rubik’s Cube. At the beginning it is perfectly balanced with each of six sides uniformly reflecting one colour. The moment one turns, twists and revolves the cube, the entire symmetry of colour and pattern gets disturbed. The learning from this is not to interfere with the well-aligned laws of nature.

He then moved to thoughts and words. One becomes as one thinks; similarly, as one feels, so one attracts. He discussed at length the power of positive words and prayers and said that cheerfulness, abundance, gratitude, appreciation, encouragement and inspiration bring happiness and energy.

The third, evening session, was conducted in the open amphitheatre area, in the lap of nature, and the Trainer discussed peace vs. prosperity. He emphasised that one must clearly define what one wants in life. To earn peace and goodwill, one may come under pressure to sacrifice one’s own space. On the other hand, to enjoy material wealth one may have to compromise with values, goodwill and peace. The question was how to balance both, peace and prosperity? By using positive words and feelings, one can be in harmony and have perfect balance, he stressed.

Practising grace. Grace is one’s ability to carry out an act without disturbing the environment. ‘With grace, accept the outcome of action, inaction and efforts as a gift of the Lord (prasad buddhi).’

Late in the evening on the first day, the participants enjoyed a brilliant campfire. Some of them took to singing and dancing to music. The relaxed participants appeared charged up for the next morning’s session.

The first session on the second day began quite early, at 7 o’clock, in an open area witnessing the rising sun and its golden glow. The discussion turned to ‘Faith’ and ‘Energy’. Faith is something invisible with strong conviction of its presence. Trainer Deepak Shinde called faith the thread of a kite flying high in the sky. It is the connection with the thread that keeps the kite (symbolising life) flying high in the sky.

He explained the ‘God concept’ with cause and effect principles. One draws energy from the effulgence of the sun and knowledge; exercise and sattvik food for the body, positive words and prayer for the mind; and reflection, contemplation and meditation for the intellect. Energy charges the sub-conscious mind. ‘Therefore, live with grace and align with nature with faith and receive energy’.

Narrating a conversation between Lord Rama and Hanuman, he shared the view that our faith in the Lord is much more powerful than the Lord. ‘God is the symbol of love. One need not have fear of the Lord.’

In the third session, the discussion focused on relations, expectations and situations. In life sometimes one may need to take a U-turn from one’s position. One ought to understand the people around, understand that man expects happiness and woman, love. But both love and happiness are complementary. Learn to say no without guilt and not to please others.

The two-day programme concluded with a vote of thanks.

SOCIETY NEWS

7TH YOUTH RESIDENTIAL REFRESHER COURSE

The 7th YRRC was organised by the Human Resource Development Committee of the Bombay Chartered Accountants’ Society from 29th to 31st May, 2020. Considering the unusual circumstances of the nationwide lockdown due to the Covid-19 pandemic, a unique online RRC was conceptualised, wherein a wide variety of topics was organised across five sessions and ten hours over a three-day refresher course – all this from the comfort of the participants’ homes.

‘Seven Chakras of the Professional World’, the theme of the event, was meant to cover seven different aspects of the profession – World, Nation, Business, Network, Me, Mind and Soul. A perfect blend of knowledge, the YRRC provided a great opportunity to all the participants to expand their horizons. It sought to present different online networking activities for interaction amongst the global participants.

A glimpse into the events of the YRRC.

The YRRC covered 14 different topics addressed by a stellar line-up of speakers from across the world as under:

Topic Speaker
1 Leadership Niranjan Hiranandani, Mumbai
2 Entrepreneurship David Wittenberg, Mumbai
3 The world has tipped: Are you prepared? Raj Nair, Mumbai
4 Story of a shy boy from Gujarat to senior position in BCAS Kanu Doshi, Mumbai
5 World economics H.E. Zulfiquar Ghadiali, Abu Dhabi
6 Indian economics Dr. Shubhda Rao, Mumbai
7 The role of development finance institutions and how to access funding for projects in emerging markets Jeffery Stoddard, Washington D.C.
8 Networking from home Manoj Gurshahani, Mumbai
9 Is work your identity? Avatar Lila, Mumbai
10 Image management Mihika Bhanot, Pune
11 Voice improvement & modulation Dr. Manisha Soni, Mumbai
12 Sustainability of happiness Padma Shri T.N. Manoharan, Chennai
13 Building resilience Shubhika Bilkha, Mumbai
14 Living with the unknown – Anecdotal renderings from a lifetime experience of the unknown Lt.-Gen. Syed Ata Hasnain, New Delhi

The content and the presentations by the speakers were clearly a class apart. They delivered their points and ideas with great clarity. They got the participants thinking on whether to be an entrepreneur or do a job in an industry or become an ‘intrapreneur’ (a new concept well explained). The participants obtained a better understanding of what skills one must possess to be a leader and how world economies play their role in shaping one’s life. We are all now at least aware of how to be ready for the world that has already tipped. One of the key learnings for the participants was ‘How to Network Digitally’, especially in the times of Covid and in our lives thereafter. They also got a glimpse into the concepts of voice modulation and image management as well as their importance in our personal and professional lives. The participants were given deep insights into and made aware of the importance of being prepared for any unforeseen situation, be it a war-room or a boardroom.

Their sensitivities tickled, the participants came up with interesting questions that were addressed extensively by the speakers, and yet left everyone wanting more. In fact, all the scheduled breaks between speakers were invariably used in extracting even more out of the knowledgeable speakers.

The event had over 150 participants from 26 cities across the world, with technology diminishing the distance between their locations.

Agra Bhilwara Jaipur Mumbai Porbandar
Ahmedabad Birganj (Nepal) Jamnagar Nagpur Pune
Aurangabad Chennai Nairobi Nashik Thane
Bangalore Coimbatore Lucknow Navi Mumbai Vadodara
Bareilly Hyderabad Margao Navsari Varanasi

The participants also took active part in the after-hours sessions like the ‘People Tambola’; ‘Lost on the Island’ – a strategy game; and a Relay Video challenge called ‘YRRC’s Got Talent’. Though there was no physical interaction between the people, all these activities ensured optimum networking. At the end of the YRRC, everyone had made some new friends in the profession whose support they could draw upon at any time. For participation in these networking activities, the participants were divided into six teams and points were awarded to the teams for the different activities.

At the closing session, participants were already asking about the next YRRC! They truly appreciated the concept and execution of the event. It was an event that was truly ‘By the Youth, Of the Youth and For the Youth’. The participants bid farewell to one another and promised to stay connected digitally.

The Team – Behind the Scenes

Top L-R: Ankit Gudhka, Prajit Gandhi, Namrata Dedhia, Anand Kothari

Middle L-R: Namrata Shah, Virag Shah, Dhruv Shah, Kinjal Bhuta

Bottom L-R: Sneh Bhuta, Naushad Panjwani

In Circle: Gaurav Save

DEEPAK PAREKH DELIVERS FOUNDING DAY LECTURE

For the first time in the history of the Bombay Chartered Accountants’ Society, the Founding Day lecture was delivered online before a virtual audience. It was the 72nd Founding Day and the programme lined up for the evening was a mouth-watering one – a talk by the inimitable Mr. Deepak Parekh, Chairman of HDFC and a qualified Chartered Accountant.

Organised with the help of the software called ZOOM, the meeting was held on 6th July and was witnessed by 135 online viewers – plus another 2,500 enthusiasts who watched it on YouTube.

The subject itself was intriguing, ‘CAs in Uncharted Times’, and the speaker was a stalwart in every sense of the term.

President Manish Sampat performed three functions. He welcomed the speaker, gave the viewers a brief background of the activities of the BCAS and also introduced the speaker.

Mr. Parekh started his talk by complimenting the Society on its leadership in the profession and said that 72 years was indeed a very long time for an institution to sustain its reputation and retain its values. He also lauded BCAS for the illustrious speakers that it had invited for its Founding Day lectures in previous years.

He pointed out that the world was going through unprecedented times with no past model against which to benchmark it. In such times, decision-making was difficult because the future was just not predictable. Therefore, the need of the hour was ‘inclusive leadership’ which could help institutions to sail through. This would be possible only through collaboration and the free flow of information between individuals and institutions rather than by working in silos.

Recalling an oft-repeated dictum, he said that there were decades when nothing happened and then there were weeks when decades happened. Therefore it was imperative to understand that the time had come to reset skills. At the same time, there was a silver lining in the current situation – it was time to accept the reality of staying at home and using that as an opportunity to develop patience and to spend quality time with near and dear ones.

In such unchartered times, CAs, especially auditors, would have to be willing to meet the challenges in respect of internal controls and possibly redefine their work so that scams do not get uncovered later. Several recent experiences of large-scale frauds had pointed to the need for auditors to become more intuitive and ensure that valuations are conservative and the concept of ‘going concern’ in the changed paradigm is not compromised. This would go a long way to help protect the interests of all stakeholders. India, despite its much acclaimed developments on many fronts, had not made much progress on human health economy to tackle crises of such enormity and scale as posed by the coronavirus pandemic.

Mr. Parekh said that India was seeing its fourth recession in recent times. But unlike the previous recessions which were due to agricultural failure, the current recession was of a different dimension. The fiscal deficit was high, corporate performance was subdued and the realty sector was saddled with stock that was difficult to liquidate. However, the positive aspect was that India could see some green shoots thanks to the bumper crop, current account surplus, and maintenance of investment grade status by credit rating agencies, low interest rates and increased FII inflows resulting in a robust foreign exchange reserve balance.

He lamented the fact that rating agencies were being unfair to India in not giving due credence to these facts. Liquidity was returning to NBFCs, global crude rates were at their lowest and GST collections were showing steady signs of returning to normal levels. Under these circumstances, there were sufficient new opportunities such as Environment Social Governance (ESG) and technology-oriented new areas such as Data Analytics, IT Audit, Artificial Intelligence and Big Data for small and medium CA firms and the CAs must make efforts to adopt them. The vast data collected and available will need analysis and none better than CAs would be able to do justice to it. He firmly believed that there was enough room for the SME sector to co-exist with the ‘Big 4’. He, however, agreed that there was need to improve the compensation standards for CAs to ensure better quality work and to justify the responsibilities, risks and liabilities that they undertake.

Overall, Mr. Parekh exuded an aura of positivity, asserting that India and its CAs had a very bright future. A significant difference would be made by the resilience of the Indian people and the strength and ability of domestic consumption to help the economy to bounce back.

The vote of thanks was proposed by Hon Jt. Secretary Mihir Sheth.

 

VIRTUAL TALK ON ‘INSPIRED LIVING’

Dr. Mayur B. Nayak conducted an inspiring virtual session ‘Inspired Living’ for the Study Circle of the Human Resource Development Committee on 14th July.

He started by pointing out that the human body is made up of five basic elements of nature, namely, earth, water, fire, air and space known as Panch Mahabhutas in Sanskrit. These exist in different proportions. For example, our body consists 72% of water.

Balancing these five elements is of utmost importance for good health. Such a balance can be attained by the practice of yoga / exercises, mudras, pranayama, through natural sources, diet variations and meditation.

Drawing an analogy, Dr. Mayur pointed out that the five elements could be said to be related to five different aspects of the human personality, namely, (i) Physical, (ii) Mental and Emotional, (iii) Intellectual – Personal and Professional, (iv) Social, and (v) Spiritual.

Earth element was linked to the physical dimension of one’s personality. Hence it was important to remain grounded and physically fit for taking a major leap in life. Emphasis was placed on the three key Pranayamas, viz., Anulom Vilom, Bhastrika (followed by Sheetali) and Kapal Bhati to increase one’s immunity to fight the current corona pandemic. By chanting the ‘Omkar’ mantra properly, one can control the movement of energy in one’s body. Participants were taught the correct way of deep breathing to reduce stress and tension.

The second element water was linked to the mental and emotional dimensions of one’s personality. One must replace fear with faith, hatred with love, and shame with freedom to attain emotional maturity. A unique 3A constitution of ‘Accept, Adjust and Appreciate’ was shared with the participants to help improve the inter-personal relationships. ‘Respond and not react’ was given as the mantra to control anger.

Fire element was linked to the intellectual dimension of one’s personality, leading to personal and professional growth. One must ignite the fire of passion to succeed in life. The first step is to do a SWOT analysis, followed by developing a right attitude in life. Self-belief is the key to success. One must try and explore the hidden potential within, Dr. Mayur said.

Air element was linked to the social dimension of one’s personality. The emphasis was on spreading one’s fragrance through good deeds. Giving is the nature of the Divine. It was revealed that one can give many things apart from money, such as smile, love,
hope, blessings, support, hugs, moral support, education, time, appreciation, happiness and so on. Covid-19
had offered a lot of opportunities to give. And for giving one must develop love and compassion in one’s heart.

Finally, the space element is linked to spiritual growth. The difference between spirituality and science / religion was explained. Eight steps of Astang Yoga to attain nirvana were highlighted. Spirituality as a way of life was explained with a detailed elaboration of the spiritual values of life. Emphasis was placed on meditation as a panacea for balanced growth in all dimensions of the personality to live an inspired life.

The talk comprised of an audio-visual presentation, followed by a Q&A session.

The speaker, Dr. Mayur Nayak, also gave some lessons to be practised at home for ‘Inspired Living’. The Study Circle was well attended by over 70 participants. The presentation is available on the YouTube Channel of the BCAS.

SOCIETY NEWS

TAXATION ON MUTUALITY PRE- AND POST-GST

In the light of the
Hon’ble Supreme Court’s decision in the case of ‘State of West Bengal vs.
Calcutta Club Ltd. and others’, the Indirect Tax Committee organised a lecture
meeting on ‘Taxation on Mutuality – Pre- and Post-GST’ at the BCAS Conference
Hall on Wednesday, 6th November, 2019. In the bespoke case the Court
decided upon applicability of mutuality in VAT and Service Tax laws in the
light of Article 366(29-A)(e) and the ratio of the Young Men’s
Indian Association case (considering its applicability after the 46th
Amendment).

 

Advocate
Vipin Jain delivers an outstanding talk on ‘Taxation on Mutuality – Pre
and Post GST’ His talk was very well received by full house of
participants.


Advocate Vipin
Jain was the principal speaker who explained the judgment in detail,
covering all significant aspects and threw light on how the Court has
interpreted the provisions under VAT and Service Tax laws at different times.
He also highlighted other landmark decisions of the Apex Court on the issue of
mutuality and English cases in which various aspects of mutuality have time and
again been tested.

 

In a session that
continued over 100 minutes, the learned speaker also gave his views on how the
said decision will impact the transactions of mutual association in the GST
regime and what would be the fate of taxes already paid by mutual organisations
in the pre-GST regime.

 

The meeting was
extremely interactive and attracted a full house with more than 100
participants attending in person and over 40 online viewers following the
lecture through a live audio / video stream.

 

INTENSIVE STUDY
GROUP ON GST

 

The Intensive Study
Group’s third batch meeting on ‘Goods and Services Tax – Clause by Clause Study
and Analysis of the GST Act’ was organised from 8th November to 7th
December, 2019 at the BCAS Conference Hall.

After the
enthusiastic response to the previous batches, it was decided to further extend
the study for even more participants. Batch-III was planned over eight sessions
of four hours each on Fridays and Saturdays. This was motivated by the
appreciation received for the first two sessions wherein section-wise study of
the GST Act was organised. There was in-depth study of all the sections and the
sessions were found to be very interactive by the participants. Each session
was held under the guidance of a mentor who had studied the law in great detail
and had a great deal of expertise on the subject. The discussions were led by a
group leader from amongst the participants.

 Participation in
the event was by invitation and each session was attended by more than 20
participants who appreciated this initiative of the Bombay Chartered
Accountants’ Society. Most of the members shared their practical experience
which was found to be of tremendous benefit by those attending the sessions.

 

INTERNATIONAL
ECONOMICS STUDY GROUP

 

The International
Economics Study Group organised a meeting on 12th December, 2019 to
discuss ‘Industrial Automation (Industry 4.0) and its Macroeconomic Impact’.

 

Mr. Kartik Shah, a young technocrat working in the Silicon Valley in the area of
industrial automation, led the discussion and presented his thoughts on the
subject. He dwelt on issues such as, ‘What is Industrial Automation and
Industry 4.0? What is its impact on companies? What is its overall impact on
the economy?’ He pointed out that Industry 4.0 represented cyber physical
systems, the Internet of Things (IoT) and Networks. GDP had spiked
post-Industry 3.0.

 

He presented case studies of the latest trends in technology that make Industrial Automation a reality and the maturity level of
various technologies, the Internet of Things (Low), Cloud Computing (High),
Artificial Intelligence (Medium) and Robotics (Low to Medium).
The microeconomic impact would be cost savings, improvement in labour
productivity, achieving safety, security and compliances and carbon savings.

 

Mr. Shah pointed out that automation impacts low-wage and low-skill labour
much more than anything else and differs from sector to sector. While the USA,
Germany and Japan would note a significant adverse impact on jobs, it would
have a low to medium adverse impact on China (also facing an ageing population)
and low on India. India could make significant progress in the area of
construction and infrastructure with the use of automation.

 

In short,
automation is a necessary evil but will boost global productivity and lead to
rise in GDP.

 

The key takeaway
was that Industrial Automation was no longer just hype – it was reality.
Companies could see the impact of automation and had begun investing in it, but
the adoption rate was slower than expected. Jobs would be impacted by
automation but there were other factors at play that would offset the impact of
automation.

 

SEMINAR ON ESTATE / SUCCESSION PLANNING

 

A full-day seminar
on ‘Estate Planning, Wills and Family Arrangement / Settlement – Critical
Aspects’ was organised at the BCAS Hall on 13th December,
2019. It was organised with the aim of emphasising the importance of estate /
succession planning and to create awareness about some of the critical aspects
thereof.

 

The seminar
received tremendous response with more than 150 participants of all
generations, members and non-members and also outstation participants from 14
cities across India.

 

BCAS
Vice- President Suhas Paranjpe presents a memento to Ashok Shah, who
presented several case studies on estate planning and so on.


Suhas Paranjpe, BCAS Vice-President, welcomed the gathering and made the
opening remarks. Chetan Shah, Chairman of the Corporate and Allied Laws
Committee, introduced the subject.

 

Ashok Shah inter alia highlighted the emerging need and the parameters
for Estate Planning and Family Settlement / Family Arrangements (through trusts
/ companies). The case studies that he presented made various structuring
options easier to understand. He also touched upon the role of a CA in a family
office. The session was chaired by Suhas Paranjpe.

 

Dr.Anup
Shah, a key speaker at the seminar provides members with insights into
various succession laws in the country, with special focus on intestate
law and domicile.


In the second
session, Dr. Anup Shah provided the members with ‘Insights of Succession
Law’ such as the Hindu Succession Law and the Indian Succession Law, with focus
on Intestate Law and Domicile. He also touched upon the relevant provisions of
the Special Marriage Act, the Adoption and Guardianship Act, the Maintenance
and Welfare of Parents Act and the Senior Citizens Act. This session was
chaired by Past President Raman Jokhakar.

 

Gautam Doshi gives his expert opinion at the seminar on Estate and Succession Planning.


In the next session, Gautam Doshi dealt with Taxation and FEMA
issues in Family Partitions and Succession Planning comprising of inheritance
tax, trust taxation, family arrangement taxation, FEMA and other issues. The session was chaired by Past President Ameet Patel.

 

Dr.
Rashmi Oza, well- known advocate, threw light on the key nuances of
drafting of wills and also on stamp duty, registration and documentation
aspects.


In the last
technical session, Advocate Dr. Rashmi Oza enlightened the participants
with the nuances of drafting of wills as well as stamp duty, registration and
documentation aspects. This session was chaired by Chetan Shah, Chairman
of the Corporate and Allied Laws Committee.

 

The seminar
concluded with a joint question-and-answer session featuring Dr. Anup Shah
and Dr. Rashmi Oza and moderated by Chetan Shah and Gautam Shah.
Thanks to their expert knowledge and rich practical experience, they addressed
all the queries posed to them.

 

TRAINING SESSION FOR
CA ARTICLE STUDENTS

The Students’ Forum
under the auspices of the HRD Committee organised a training session for CA
article students on ‘Significant Changes in GST in Last One Year’ and ‘Recent
Changes in Form GSTR9 and 9C’ on 14th December, 2019 in the BCAS
Conference Hall.

Interestingly, the
session was broadly divided into two parts: Changes in GSTR9 and 9C; and
Significant Changes in GST in the Last One Year. Student speaker Mr. Sachin
Mittal and Jigar Shah were in charge of the sessions.

 

Anand Kothari, Convener of the HRD Committee, spoke about the various activities
conducted by the BCAS Students’ Forum, while Dnyanesh Patade,
Student Co-ordinator, introduced the speakers for the respective sessions.

 

The GST law is
still in the process of stabilising and the GST Council has issued various
notifications, circulars and amendment acts.

 

Mr. Sachin
Mittal, the student speaker, started off with
statistics of the number of notifications, circulars and orders issued. He
covered significant changes such as notifications, amendments, circulars and so
on, exhibiting his meticulous study. He also highlighted the various issues /
complexities involved. A clause-by-clause analysis of the changes in GSTR9 and
9C was done by him. And he gave useful tips to the article students on various
clauses of GSTR9 and 9C.

 

The mentor for the
session, Jigar Shah, presented a Certificate of Appreciation to Mr.
Sachin Mittal and applauded his outstanding presentation.

 

Anand Kothari, the Convener of the HRD Committee, proposed the vote of thanks.
More than 40 students participated in the interactive session and their
feedback was very positive.

 

FEMA STUDY CIRCLE
MEETING

 

The FEMA Study
Circle meeting was held on Monday, 16th December, 2019 at the BCAS
Conference Hall.

 

The speaker on the
occasion, Ms Niki Shah, highlighted the differences between the old FDI
Regulations and the new Non-Debt Rules, viz. placement of various schedules in
the new regulations, classification of different types of instruments and the
various schedules.

 

Following her presentation, the discussion continued on the same
interesting tract as the other participants discussed and debated various
issues based on their personal experiences. This also brought to the fore the
changes made and those that needed further clarification from the authorities
concerned. In short, it set the stage for other professionals to advise their
clients going forward.

 

CASE STUDY ON THE TAKEOVER OF ABN AMRO

 

A lecture meeting
on the above subject was organised on 23rd December, 2019 at the BCAS
Conference Hall. It was addressed by Mr. Prakash Advani, who was part of
the team which dealt with the takeover of ABN AMRO.

 

Prakash
Advani, who was part of the team experts that dealt with the team of
experts that dealt with the battle for the takeover of ABN AMRO, giving a
master class on Mergers and Acquisitions (M&A).

He shared insights
about the largest takeover deal in the financial sector till date. The takeover
battle had begun just before the financial meltdown of 2007-08. The reasons for
the initiation of the takeover by a consortium of three banks, Fortis, RBS and
Santander, was the announcement of the merger of ABN AMRO with Barclays to
create a European leader in retail and commercial banking. The consortium
brought on the table an offer worth Euro 71.1 bn.

There was a counter
bid by Barclays with other international financial players roped in to have a
pie of the lucrative deal. Barclays received the financial muscle to raise its
bid through investment in it by China Development Bank (CDB), Temasek, Qatar
and Abu Dhabi. Their bid, though an improved one, was still substantially short
on the cash component in the overall deal.

 

The consortium
sweetened its deal further by increasing the cash component in the overall deal
to 93%, though it offered the same price as was offered in its initial bid,
that is, Euro 71.1 bn. This provided greater certainty of the value than
Barclays’s proposed offer.

 

The events which
unfolded after the takeover, which was highly leveraged and in the times of
financial meltdown, has key learnings for the financial sector.

 

Due to high leverage,
the operations at RBS, Fortis and Santander were affected seriously. The
governments in the UK, the Netherlands and Belgium had to step in to bail out
the operations of RBS and Fortis. Santander had some strategic standalone
operations in LATAM and Italy which assisted it in integrating parts of the
operations acquired through the ABN AMRO deal and swapping some of its business
with GE Money.

 

As per Mr.
Prakash Advani, the key learnings for M&A professionals are as follows:

  •      There is never a merger of
    equals.
  •      Revenue synergies never
    exist, though this may be highlighted as a great rationale for the merger /
    acquisition.
  •      Buying a perpetual
    instrument (equity) by raising debt is an avoidable sin.
  •      Never love the assets and
    try to offload the risks.
  •      Winning is about losing
    less.
  •      We always remember what
    happened but do not remember what could have happened.

 

He also provided an
acquirer’s and seller’s perspective during the M&A.

 

From the
perspective of an acquirer, the following points should be kept in mind:

  •      There should be thorough
    due diligence, understanding of the culture and motivations of the sell side.
  •      A valuation model is a
    tool and not the gospel truth.
  •      Structuring purchase price
    payment and acquisition funding (tenor long vs. short) is important.
  •      Understand the incentive
    structure to selling company key executives and its value exclusivity.
  •      Fee structure to the
    advisers and investment bankers.

 

From the
perspective of a seller / target, the following points should be kept in mind:

  •      Thorough preparation –
    preparation is 90% success.
  •      A highly motivated team
    with full alignment of goals and incentives.
  •      Test the appetite
    informally pre-launch. Once sale launched, go all out to close. A deal that
    launches but doesn’t close gets tainted.
  •      Disclose more; the more
    one discloses the lesser is the chance of a call on warranties.
  •      Exit clauses / guarantees
    to minority investors.

 

Mr. Prakash
Advani also briefly touched upon the Indian
diaspora in M&A and provided insights into the major cause of the NBFC
crisis which, in his opinion, is more of an asset-liability mismatch and not
the intent of the management to defraud the investors. He opined that the
Indian NBFC sector is highly geared and has a lot of dependency on wholesale funding
which, again, is short-term in nature and the activities of lending carried out
by them is for the medium to long term which creates pressure in repayment of
the borrowed funds.

 

He gave thorough insights into the art of deal-making and the 80 odd participants
received several valuable inputs in the course of the exemplary exposition presented by him.

 

DIRECT TAX
LAWS STUDY CIRCLE MEETING

 

The Direct Tax Laws
Study Circle meeting was held on 24th December, 2019 at the BCAS
Conference Hall.

 

The Chairman of the
Study Circle Devendra Jain, and the Group Leader Dipan Agte
anchored the meeting.

 

Dipan Agte covered the four major issues mentioned below:

(i)    Withholding tax and prosecution: wherein the
new prosecution guidelines were discussed. Various judgements in this regard
were taken up and practical implementation by the tax officers was discussed.

(ii)   Disallowance u/s 14A: A brief background of
the provision and related rule was debated. Various issues arising from section
14A such as investment in subsidiaries, investments held as stock-in-trade,
etc. were taken up, including references to applicable case laws.

(iii)   Depreciation on goodwill: Judgements relating
to depreciation on goodwill on amalgamation and depreciation of goodwill on
acquisition saw detailed discussions.

(iv)  Deemed dividend: A practical
illustration to understand the applicability of provisions relating to deemed
dividend in various scenarios was discussed. Further, three recent judgements
on deemed dividend and the distinguishing facts in each case were taken up in
depth.

 

Chairman Devendra Jain, on the other hand, gave practical insights
on various issues and their impact. Both the Chairman and the Group Leader took questions from the
participants throughout the highly interactive session.

 

The session concluded with a vote of
thanks.

Society News

HUMAN RESOURCE
DEVELOPMENT COMMITTEE

The HRD Committee
organised a half-day workshop for senior CAs styled Get the most from your
smart phone! It was held on Saturday, 14th march, 2020 in the BCAS
hall.

 

Not only senior
chartered accountants but also their spouses were invited to learn how to
benefit more from their smartphones and mobile apps.

 

The participants
were welcomed by Rajesh Muni (HRD Committee Chairman). This was followed
by an introductory note delivered by Anand Kothari (HRD Committee
Convener).

 

The first
session was conducted by the young Rajesh Pabari who narrated the benefits
of various useful mobile applications. the participants were guided to download
‘Zoom  meetings’ and the workshop was
conducted in an interactive manner making the best use of this app. He further
discussed other apps like trello, SwiftKey Keyboard, SMS organiser by
Microsoft, Drupe, etc.

 

In the second
session, conducted by the experienced techie Yazdi Tantra, the benefits
of Google were laid bare before the participants. He gave live training on optimum
use of Google through Voice Search and performing simple arithmetic
calculations, setting reminders and alarms, exploring time / weather in any city,
playing a song or accessing the current news, translation in various languages
and many other benefits of Google.

 

He explained
shortcut keys for using Gmail and some search features. He also helped those
taking part to explore various apps such as M-aadhaar, DigiLocker, Camscanner,
Texpand, Skedit, Fast.com, Web. Whatsapp, WriteOnPdF, Files, DecisionCrafter,
Practo and tripIt.

 

Both sessions were interactive and the
participants were provided hands-on training / experience on the use of various
mobile apps. The faculties were energetic in guiding the participants, some of
whom were surprised to know about the numerous benefits of a smartphone which
they had been using only for making phone calls.

Society News

DIRECT TAXES HOME REFRESHER COURSE

 

The Taxation
Committee organised the first-ever Direct Taxes Home Refresher Course (DTHRC)
2020 from 20th April to 1st May, 2020. It comprised seven
dynamic sessions on topics which have significant relevance and application in
the current times. The course was crafted under the pressing times of the
Covid-19 pandemic to enable members who are either working from home, or
working at home, to stay connected with the current scenario in direct taxes.

 

Members and
participants were given a kaleidoscopic view of the new taxation regime
effective from F.Y. 2021 onwards, the recent amendments to the provisions of
TDS and TCS, the fundamentals and applications of the Vivad se Vishwas
Scheme and the recent amendments to taxation of charitable trusts.

 

Incidentally,
the sessions on tax implications for banks and NBFCs, penalty provisions and
domestic GAAR went on beyond the time fixed as the speakers shared their vast
knowledge on these subjects.

 

The DTHRC
was organised and conducted on the Zoom app where the participants not only saw
the speaker and the presentation, but they could also post queries to the host
through the chat box. The meetings were also accessible through the BCAS
page on YouTube live. On an average, every meeting saw an attendance of 500
to 700 persons.

 

The queries
were filtered by the hosts and were dealt with by the respective speakers at
the end of the session.

 

The following table
summarises the DTHRC:

 

Date

Topic

Speaker

20.4.2020

New taxation regime u/s
115BAA,115BAC, 115BAD

Bhadresh Doshi

21.4.2020

Vivad se Vishwas scheme

Gautam Nayak

24.4.2020

Recent amendments related to
charitable trusts

Dr. Gautam Shah

27.4.2020

Recent amendments to TDS and
TCS provisions

Sonalee Godbole

28.4.2020

Tax implications for banks
and NBFCs

G.R. Hari

29.4.2020

Penalty u/s 270A/270AA

Jagdish Punjabi

1.5.2020

Domestic GAAR

Pinakin Desai

 

With such
high participation, the sessions were bound to be interactive and the speakers
were equally eager to share their insights on their respective subjects.

 

VIRTUAL ZOOM SESSION ON ‘LOCKED IN LOCKDOWN’

 

The HRD
Committee organised a virtual Zoom session styled ‘Locked in Lockdown’ from
4.30 pm onwards on 11th April.

 

Thanks again
to the lockdown due to Covid-19, the Committee took this commendable initiative
to help members to positively cope up with the forced confinement.
Approximately 90 participants took part in the session.

 

It was
conducted by Dr. Nidhi Thanawala who is a therapist, life coach,
professor recruiter, reality TV expert, all rolled into one. She planned the
session in such a way as to move the focus on creating a positive mindset and
making the best of the lockdown period. She suggested ways to deal with the
social media influence and reduce screen time. She provided tips to schedule
routines, engage in hobbies like drawing and painting and spend time in
learning new things. She also highlighted how we should adjust our home
environment for the smooth functioning of work from home, distribution of
household chores and spending quality time with the family during the lockdown
period.

 

As expected,
the session was interactive and the participants asked a lot of questions
throughout the session. Dr. Thanawalla was equally energetic in
providing her insights and answered all the questions posed by the
participants.

 

The session
concluded with a vote of thanks proposed by Sneh Bhuta (Convener of the
HRD Committee).

 

PRACTISING CA’s SURVIVAL GUIDE

 

In the
backdrop of Covid-19 the leaders of CA firms have faced many new issues /
dilemmas about survival and growth that needed discussion and understanding. To
address these problems, BCAS arranged a unique programme ‘The CA Survival
Guide’ to present options and strategies to address some of them.

 

It was a
one-of-its-kind three-session online paid webinar conducted through the Zoom
platform. The programme received excellent response with enrolments being
received till the last minute and with a final count of 91.

 

The first
session was conducted by Nandita Parikh on ‘People Matters because
People Matter’ on 28th April over a Zoom call. The session was
divided into three parts, namely, ‘Our Partners’, ‘Our People’ and ‘Our Clients’,
followed by a round of questions and answers.

 

Nandita
spoke about partners’ responsibilities in a CA firm and their post-Covid roles
and alignment, provided guidance on ‘must do’ things for partners and
emphasised on the new era of consolidation and collaboration. In the second
part of her presentation, she dwelt on ‘our people’, i.e. the employees,
retainers and associates. She addressed pertinent questions such as salary
deductions, increments and promotions in these difficult times and pointed to
the importance of re-planning and preparations for reopening, post the
lockdown, with special focus on re-skilling, relocation and new ideas for the
employees.

 

In the third
part of her presentation, Nandita Parikh addressed questions on how to
service clients in terms of relocation, revision of fees, scope of work, usage
of digital platforms and new offerings. This was followed by an interesting
Q&A session. And it all concluded with a vote of thanks proposed by Mukesh
Trivedi (Convener, HRD Committee).

 

The second
session was by Ameet Patel on ‘No Technology, No Future’ on 30th
April over a Zoom call. He began by asking a bold question – Are we aware of
the disruption sweeping the world in general and our profession in particular?
He noted that most CA firms were unable to function during the lockdown on
account of unpreparedness, lack of infrastructure and lack of data. The key
lesson from this was to come out of our comfort zones and focus on upgrading
the use of technology.

 

Ameet
discussed various technology issues faced by CAs and suggested solutions to the
same in the shape of available software and the technologies at one’s disposal.
He placed particular emphasis on the usage of technology in day-to-day
functioning to improve offerings and to be future-ready. The session concluded
with a Q&A round and a vote of thanks by Namrata Dedhia.

 

The third
and the final session of ‘The CA Survival Guide’ series was conducted by Vaibhav
Manek on ‘Practice Growth Strategy’ on 2nd May, again over a
Zoom call.

 

He began by
focusing on the relevance of growth in the times of Covid-19 and how the
expectations of clients would change. Therefore, it was time to think
differently about growth, strategy and reinventing ourselves. What was the
recipe for sustainable growth and making strategic choices? For this it was
necessary to focus on the pros and cons of providing specialised services,
doing self-diagnosis of the firm, making a 360-degree strategy and elevating
the clients’ experiences.

 

In the third
part of the presentation, Vaibhav emphasised a ‘Call for Action’ and
described how execution was the most important. He spoke about developing and
implementing strategic visions for the firm. The participants asked several
questions and the speaker answered them with elan. The session ended with a
vote of thanks proposed by Sneh Bhuta.

 

The programme ‘The CA Survival Guide’ specifically focused on the small
and medium-sized CA firms who would be required to respond effectively to the
mammoth disruption caused by the pandemic through focussed thinking,
well-defined and dynamic strategy and timely action.

 

VIRTUAL CLASS SERIES ON TECHNOLOGY

 

Amidst the
lockdown due to Covid-19, the HRD Committee took the first initiative to keep
its members and their families engaged sitting in their homes and using their
phones, iPads or PC’s smartly. Their response was very encouraging and it was
decided to keep the momentum going with a series of similar virtual classes.

All the
sessions were conducted on different dates by the senior and experienced techie
Yazdi Tantra.

 

  •     1st
    April, 11:00 am – ‘Use of Google’

Yazdi
listed the innumerable benefits of Google. He gave live training on optimum use
of Google through Voice Search and performing simple arithmetic calculations,
setting reminders and alarms, exploring time / weather in any city, playing a
song or reading the current news, translating in various languages and so on.

 

The session
can be viewed on the BCAS YouTube Channel at the following link:
https://www.youtube.com/watch?v=ActAE4vm6bk

 

  •      9th
    April, 10:30 am – ‘Use of GMail’

The faculty
started by pointing out that Gmail is one of the world’s largest Email
programmes, with up to 26% market share. There were many features hidden under
the hood which made Gmail a very fast, efficient and reliable tool. Yazdi
shared tips, tricks and shortcuts which could make Gmail a versatile and
productive business tool.

 

The session can be viewed on BCAS YouTube Channel at: https://www.youtube.com/watch?v=frzNQM8If40&t=1409s

 

  •            15th
    April, 10:30 am – ‘Use of Google Chrome Extensions’

The session
started with the explanation that extensions are third-party programmes that
add new features to browsers and personalise one’s browsing experience. Chrome
browser was open to accepting the maximum number of extensions. The speaker
explained a few extensions to help maximise productivity and save time when
using Chrome. He also explained extensions that can be used with Gmail, making
the mailing experience easy and more productive.

 

The session can be viewed on BCAS YouTube Channel at: https://www.youtube.com/watch?v=BIn6i8YnGoc

 

  •      24th
    April, 09:30 pm –‘Dictation Apps’

This session
was jointly conducted by the HRD Committee along with the Technology Initiative
Committee. The faculty started by explaining the features of the desktop-based
app https://dictation.io/ which can be used through a web browser without
installing any application. He explained the copy and edit features and the use
of this platform to dictate in various languages. He then explained using
dictation facility in Gmail through a web browser as well as mobile phones.

The session can be viewed on BCAS YouTube Channel at: https://www.youtube.com/watch?v=01ZUIrbop0w

 

‘VIRTUAL’ STUDENTS STUDY CIRCLE

 

The Students
Forum under the auspices of the HRD Committee organised its first ‘Virtual’
Students Study Circle meeting during the lockdown on the key subject of ‘Bank
Audit – Recent Changes and Covid-19 Impact’. It was conducted via Zoom Meetings
on 16th April from 6 to 7.30 pm.

 

The study
circle was led by Pankaj Tiwari who is an expert on the subject. Azvi
Khalid, the student Co-ordinator, introduced the speaker and spoke about
the activities undertaken by BCAS for students.

 

In his
detailed presentation, Pankaj covered all the major aspects of bank
audits. He explained in brief the relief granted by RBI after assessing the
current situation as a result of the Covid-19 pandemic. He dwelt in detail on
the impact of the relief measures for banks, such as changes in Asset
Classification and Provisioning, Income Recognition, Deferment of EMI on
various loans, and the impact of the same on audit procedure. He also touched
upon the important aspects that need to be taken into consideration while
conducting the audit.

 

The speaker
answered all the questions raised by the participants. The interactive session
ended with Azvi Khalid proposing the vote of thanks to the speaker for
enlightening the students with his expert knowledge.

 

‘RANKERS’ SECRETS – LEARNINGS AND INSPIRATION FOR CA
STUDENTS’

 

The Seminar,
Public Relations and Membership Development Committee organised a talk by
toppers (single-digit rankers) on the above subject on 3rd May over
the Zoom meeting platform.

 

The digital
meeting was addressed by Kushal Lodha [CA Final (AIR 5), CA IPCC (AIR
5), CA CPT (AIR 6)] and Dhruv Kothari [CA Final (AIR 2), CA IPCC (AIR
22)].

 

At the
beginning of the session, President Manish Sampat shared some details of
his journey and experience as a Chartered Accountant with the student
participants.

 

The speakers
themselves shared their thought processes, how they approached the CA exams,
what discipline they followed, which materials they referred to, how many times
they revised their subjects, last-day preparations, analysing exam papers, how
to approach the same and many such questions.

 

After their
address, the Coordinators’ panel asked questions and the speakers answered each
one in detail.

 

The session
was highly motivating and around 540 participants, including on the Zoom
meeting platform and on YouTube, benefited from the experience of the two top
rankers.

 

SAMVID 2020 – MSME’S STEPS TOWARDS
ATMANIRBHARTA

 

The Bombay
Chartered Accountants’ Society was the knowledge partner for a webinar
organised by the Mahesh Professional Forum, Pune, on ‘SAMVID 2020 – MSME’s
Steps Towards Atmanirbharta’ on 23rd May. The online session
was held between 4 and 6 pm.

 

President Manish
Sampat set the ball rolling with his introductory speech in which he shared
details about the BCAS, its motto and activities. He also introduced the
topic and its relevance in the current times.

 

The first
speaker was Anand Bathiya who focused on the context, scope and benefits
of registration as Micro, Small and Medium Enterprises (MSMEs). He described
its revised definition, the registration process and the benefits and details
of various schemes for MSMEs. He also explained a few key initiatives like the Atmanirbhar
Scheme and the TReDS platform.

 

The second
session was taken up by Chirag Doshi who spoke on the Standard Operating
Procedures (SOPs) for MSMEs. He also explained the plan of action for revival
of small enterprises after they open up when the Covid-19 lockdown ends.

 

Mrinal Mehta
was at the helm for the third session and explained the tax provisions
applicable to MSMEs. He also discussed the tax incentives and schemes available
under the Direct and Indirect Tax regimes for MSMEs. The reliefs in the
statutory due dates announced by the government because of Covid-19 were also
discussed.

 

After the
key speakers the panel of Coordinators posed the viewers’ questions and the
speakers answered each and every one of them.

 

The session
attracted more than 1,100 participants from all over the country who said that
they had immensely benefited from the knowledge and practical experience shared
by the speakers.

 

The role of BCAS,
which was the knowledge partner, was highly appreciated by the SAMVID committee
for its quality and support.

 

BCAS IDEA ANALYTICS SCHOOL FOR INTERNAL AUDITORS

 

To help develop Data Analytics skills amongst Internal Audit
professionals in a structured and focused manner, the Internal Audit Committee
of the BCAS, in association with SAMA Audit Systems and Softwares Pvt.
Ltd., designed a unique online hands-on course on data analytics using IDEA
tools at two levels – Intermediate (two batches announced) and Expert (one
batch), every course comprising of five online sessions of two and a half hours
each, with the IDEA Analytics software and data files being made available to
each participant for a hands-on experience. The first Intermediate course was
launched in May and the other two courses are scheduled for June, 2020.

 

The course
is being conducted by certified IDEA trainers and includes availability of IDEA
software tools for 45 days and a help-desk for assisting the participants
navigate their way in IDEA for a period of two weeks.

 

10TH Ind AS RESIDENTIAL STUDY
COURSE

 

This year
the BCAS completed a full decade of its Ind AS Residential Study Course
(RSC). The journey of RSCs began at the Rambhau Mhalgi Prabodhini just outside
Bombay city in December, 2009 and marked a new avenue of learning and sharing
knowledge on Ind AS. Over the last nine years, RSC participants got together at
various locations over two nights and three days for discussions on this vital
subject.

Fittingly,
the 10th edition was organised at the Hyatt Alila Diwa Hotel in Goa
from 5th to 8th March. In a departure to mark the 10th
edition of this sought-after and eagerly-awaited study course – and with exotic
Goa being chosen as the venue, spouses were also allowed to join. In another
departure from the norm, the duration of the RSC was also extended by one more
day to three nights and four days. The RSC witnessed a very large number of
participants from all over the country. For the spouses and the participants,
special tours, events and activities were planned, such as a Panjim city tour,
a cruise, beach activities and so on.

 

As usual,
the 10th RSC also followed the format of extensive group discussions
on Case Studies-based papers, presentation papers on subjects of current
topical interest and a panel discussion with experts. The participants were
divided into three groups to have in-depth discussions and a learning and
sharing experience. The group leaders made strenuous efforts to prepare their
presentations for detailed discussions.

 

The list of
topics and the paper writers / presenters is as under:

 

Sr. No.

Paper / Presentation

Faculty

Nature of activity

1.

Case Studies on Business
Combination

and Consolidation and Ind AS
116 – Leases

Raj Mullick

Group Discussion

2.

Case Studies on Financial
Instruments

and Ind AS 115 – Revenue

V. Venkat

Group Discussion

3.

Presentation Paper on
Taxation aspects of

Ind AS (including GST and
MAT)

Gautam B. Doshi         

Presentation

4.

Recent Developments in
Statutory Audit and

Audit Reporting (including
CARO 2020)

Himanshu Kishnadwala

Presentation

5.

Conceptual Framework for Ind
AS and

Recent Developments at IASB

Vidhyadhar Kulkarni

Presentation

6.

Panel Discussion on Utility
of Financial

Statements and Relevance of
Audit

 

Nilesh Vikamsey,
Raj Mullick,

Prashant Jain,
Jigar Shah

Moderator:

Sandeep Shah

 

 

Panel Discussion

 

The RSC
started on Thursday, 5th March with the inaugural session at which
President Manish Sampat; Himanshu Kishnadwala, Chairman of the
Accounting and Auditing Committee; Chirag Doshi, Managing Committee
Member and Convener; Amit Purohit and Nikhil Patel, Conveners,
were present. In his opening remarks, the President wished the participants a
great learning experience. He also spoke briefly about the activities
undertaken by BCAS and invited non-members to join it and gain
uninterrupted knowledge. Himanshu Kishnadwala briefly explained the
importance and relevance of RSCs and outlined the events planned for the
following four days.

 

The
inauguration was followed by the presentation paper on ‘Taxation Aspects of Ind
AS (including GST and MAT)’ by Gautam B. Doshi and another presentation
paper on ‘Recent Developments in Statutory Audit and Audit Reporting (including
CARO 2020)’ by Himanshu Kishnadwala.

 

On the next
morning, the study groups discussed the ‘Case Studies on Business Combination and
Consolidation and Ind AS 116-Leases’ by Raj Mullick. The group
discussion was followed by the presentation and reply by Raj Mullick,
the Paper writer. The second half of the day was set aside for leisure
activities for the participants.

 

Saturday
morning (7th March) saw fun-filled beach activities, which was
followed by the group discussion on Paper 2 – ‘Case Studies on Financial
Instruments and Ind AS 115-Revenue’ by V. Venkat. The post-lunch
session featured the Presentation Paper on ‘Conceptual Framework for Ind AS and
Recent Developments at IASB’ by Vidhyadhar Kulkarni, followed by
Response to Paper 2 Case Studies by V. Venkat.

 

A highly
interesting and lively panel discussion on ‘Utility of Financial Statements and
Relevance of Audit’ was organised on 8th March (Sunday), the last
day of the RSC. The panellists were Nilesh Vikamsey, Raj Mullick, Prashant
Jain and Jigar Shah. The discussion was moderated by Sandeep Shah.

 

(Readers are
requested to refer to the April, 2020 issue of the BCAJ wherein we carried
an exhaustive report on the above panel discussion. It was written by Zubin
Billimoria and appeared under the headline ‘Panel Discussion on Utility of
Financial Statements and Relevance of Audit at the 10th Ind AS RSC’.
The report appeared on Page No.s 101 to 104.)

 

Incidentally,
at the panel discussion a publication titled ‘Mandatory Accounting Standards
(Ind AS) – Extracts From Published Accounts’ was also released. The booking for
the publication was opened for outstation members and the response was very
positive.

 

The RSC
ended with a concluding session at which those members who were first-time
participants shared their experience of the event. Those who had participated
in five or more RSCs (including past and present) were also honoured on the
occasion.

 

The Chairman
thanked the participants for making the event a grand success. And Manish
Sampat thanked him, Himanshu, for successfully planning and
executing such an important event this year by setting a very high benchmark
for quality learning.

 

Before
leaving, most participants said they had benefited immensely from the knowledge
shared by the learned and experienced faculties and also from the group
discussions.

 

OUR WORLD AFTER COVID-19

 

The Managing
Committee of the BCAS organised a virtual chat on ‘The World and
India Post Covid-19’ on 9th May with the celebrated entrepreneur
and academician, Mr. Mohandas Pai (pictured below).

A Padma
Shri awardee, he is the Chairman of Manipal Global Education (Manipal
University). A former Director of Infosys and Head of the Administration,
Education and Research, Financial, Human Resources of Infosys Leadership
Institute, he was also an all-India rank holder at the CA finals of the
Institute of Chartered Accountants of India.

 

The expert
chat was crafted under the pressing times of Covid-19 to enable the
viewer-participants to understand the effect of Covid-19 in the fields of
economics, business and health, along with the dynamics of how this pandemic
will affect both India and the world. Had the government done enough for the
country? How will India make up for the loss? Will there be revival in the
economy? What will be the future of the world and of our country?

 

Padamchand
Khincha helped arrange the chat which was moderated by two Past Presidents
Shariq Contractor and BCAJ Editor Raman Jokhakar. The
welcome address was delivered by Mayur Nayak.

 

Mr. Pai forecast
that world dependence on China will reduce. China’s export strategies will no
longer benefit it. Already, it had suffered an economic decline of 6% in the
first quarter of this year, a negative decline of 6% in its $15 trillion
economy. China will now have to be dependent on internal consumption.

 

The oil
industry had been majorly impacted due to the pandemic. The second largest
industry in the world ($6 trillion), it was affected due to excess production
by America. China was the second largest consumer of oil, but thanks to the
virus its consumption of oil had come down. Owing to this, the oil industry
economy had fallen to $4 trillion. Excess production of oil by countries like
the US, Saudi Arabia and Russia had led to a crash in oil prices, accounting
for a decline in the oil economy to $1.5 trillion and reduction in consumption
from 100 million barrels to 30 million barrels a day.

 

Central
Banks around the world had been trying to control the crisis by improving
liquidity. The Federal Reserve had increased in the balance sheet from $1
trillion to $6 trillion, thanks to buying of Government and Corporate Bonds.
The growth this year could be negative.

 

Mr. Pai
stated that the travel and tourism industry was virtually at a halt and
hospitality, too, had been affected. These were the largest employers worldwide
but had come to a total standstill.

 

Before
Covid, the global GDP of around $82 trillion had been growing by 2 to 3%, but
now it was down by 8 to 10%. The same position applied to the USA, too. Such a
dip in the economy had never been experienced since the Second World War.
Anti-China sentiments, the decline of China and Japan and the currency crisis –
all of these were a new experience.

 

As for
India, Mr. Pai said agriculture is expected to grow by 3.5 to 4% with
expectation of a good monsoon. Industries related to construction and mining
are expected to go down by 2.5%. Services would move into negative territory
with 2 to 3% growth. In fact, India may see a flat growth rate of not more than
1.5% in its GDP.

 

‘Work from
Home’ is the mantra of the new era, with a 40 million workforce staying home
and working. As for IT, new developments would be witnessed in areas such as
TeleMedicine, E-Health, E-Education and
E-Entertainment.

 

So far as global trade is concerned, India is the next China. The world
will trust India more than China, especially in global trade and the pharma
sector. The government is expected to boost demand by spending Rs. 1 lakh
crores on infrastructure.

 

Mr. Pai advised Chartered
Accountants not to ‘turn to ghosts’ (seers, soothsayers and astrologers) but to
use technology to become more global and more efficient. They would be able to
offer a quantum leap in the volume and quality of the services that they could
provide.

 

He concluded by stating that by 2025 the emerging markets will have
higher GDP compared to the OECD countries. Globalisation had gone too far – far
ahead of the need – and was trying to find a new normal with equal stress on
national considerations.

 

‘This pandemic is like a global war. Globalisation has made us realise
that there is interdependence between nations. There will be some ups and downs
for the next three to four years,’ Mr. Pai added.

 

Clearly, the
expert chat was a reality check on the current times. The speaker was
professional in his approach and knowledgeable in the points that he covered.

SOCIETY NEWS

FEMA REFRESHER COURSE

 

Enthused by the response to the four-day
Refresher Course followed by a panel discussion held in the month of April,
another Refresher Course was organised in June, 2020 that was far more
extensive and provided in-depth coverage of topics. The topics covered were
truly diverse, such as ‘Understanding the Structure of FEMA’, ‘Practical
Aspects of filing various Forms’, ‘Import and Export of Goods and Services’ and
‘Doing Business through Liaison Office, Project Office, Branch Office’. Also
covered were some more complex topics like joint venture, wholly-owned
subsidiary and indirect investment in India, investment on non-repatriation
basis and FDI in Limited Liability Partnerships, practical cases related to
compounding and so on.

 

Some unusual topics covered were FEMA from
an auditor’s perspective, fundamental and complex issues under the Benami Law,
Anti-Money Laundering Law and handling of offences and prosecution under FEMA.
This session also featured a panel discussion which covered all the above
topics.

 

The speakers for all the sessions were an
eclectic mix ranging from practising Chartered Accountants, Solicitors and
Consultants to members of the Income Tax Department and Advocates of the
Supreme Court of India. This gave participants a holistic view of FEMA which
will hone their skills and take them a long way in their professional careers.

 

The response to the Refresher Course was
overwhelming, with 298 participants registering from various cities across the
country, including Chennai, Indore and Gurugram. The participants appreciated
the fact that speakers not only explained the topics satisfactorily and
supplemented it with real-life situations, but also answered their queries and
concerns even if it meant going well beyond the time allotted for the session.
In a nutshell, it was a very enriching course for the participants, speakers
and conveners alike.


‘SEVEN SPIRITUAL LAWS OF SUCCESS’

 

An online meeting of the Study Circle of the
Human Resource Development Committee was held on 12th May. The
speaker was Vinod Kumar Jain, who offered learnings from the book ‘Seven
Spiritual Laws of Success’ by the eminent author and spiritual ‘guru’ Deepak
Chopra.

 

The speaker started by asking the question,
how does one define the term ‘Success’? He answered by stating that in addition
to material wealth it will generally include good health, energy, enthusiasm
for life, fulfilling relationship, creative freedom, emotional and
psychological stability, sense of well-being and peace of mind. But ‘True
Success’ is the experience of a miracle of divinity unfolding within us which
is possible through understanding of the seven spiritual laws. The speaker then
explained each of the seven spiritual laws with examples from his own life.
After explaining the law, he described how the same can be applied in our daily
lives.

 

FIRST. The Law of Pure Potentiality. Our true self is one of pure
potentiality; we align with the power that manifests everything in the
universe. Practice: Meditation,
silence, non-judgement and being with nature.

SECOND. The
Law of Giving. The universe operates through dynamic exchange of giving and
receiving. Practice: Learn to give
what you want.

THIRD. The
Law of Karma. Every action generates a force of energy that returns to us
in like kind; what we sow is what we reap. Practice:
Witness the choice you make.

FOURTH. The
Law of Least Effort. Nature functions with effortless ease. When we harness
the forces of harmony, joy and love, we easily create success and good fortune.
Practice: Accept, respond and no
defence.

FIFTH. The
Law of Intention and Desire. Inherent in every intention and desire is the
mechanics for its fulfilment. Practice:
Make a list of desires, see it regularly and surrender.

SIXTH. The
Law of Detachment. In order to acquire anything in the physical universe,
one has to relinquish one’s attachment to it. Practice:
Step infield of all possibilities.

SEVENTH. The
Law of Dharma or Purpose in Life. Everyone
has a purpose in life… a unique gift or special talent to give to others. Practice: Use unique talent to serve.

There were over 175 participants and they
raised several questions. The speaker responded to all of them in detail.

The presentation on YouTube is available on
the Society’s link (http://youtu.be/1pw2XHC8wRA).

 

‘THE MAN OF THE CENTURY’

 

Another meeting of the Study Circle of the
Human Resource Development Committee was held online on 9th June on
the topic ‘Values: Bapu@150’ . The speaker was Mukesh Trivedi. This talk
was in continuation of the celebration of the 150th birthday of
Mahatma Gandhi (fondly called Bapu) on 2nd October, 2019 by BCAS.

 

Initially, the speaker touched on how
different sections of the community perceived Bapu’s values today. He opined
that the new generation needed to know more about Bapu. In fact, Bapu was the
most respectful leader of the country who truthfully walked the values which he
talked about. He was the man of the century, a true Yug Purush. Each and
every citizen should recall his values for the holistic growth of the nation.

 

Next, the speaker discussed the Ekadash
Vrat, i.e. the ‘11 Values’ or guiding principles on which Bapu lived his
life. He appealed to and encouraged participants to pick any value of Bapu and
imbibe it in their lives. If they did that, it would be a fitting tribute and
respectful celebration of the 150th year of Bapu’s birth
anniversary.

 

Speaker Mukesh Trivedi listed Bapu’s
Eleven Values as: Ahimsa, satya, asteya, brahmacharya, asangraha,
sharirshram, aswad, sarvatrabhayvarjan, swadeshi, sparsh, bhavana. Of these
eleven, the values that he chose to focus on were three core values, Brahmacharya,
Ahimsa and Satya.

 

Discussing these, he shared the Vedantic
principles and Bapu’s views through his presentation. He also shared anecdotes
quoting from Bapu’s life described in his autobiography ‘My Experiments with
Truth’.

 

Mukesh Trivedi explained the three core values as under:

Brahmacharya
is living the life of moderation in ‘sense enjoyments’ and control over
‘indulgence’.

 

Ahimsa is
non-injury or non-violence which ought to be practised at the level of emotions
in the mind.

 

Satya is truthfulness lived with a strong conviction
of values. It must be followed at the level of intellect in the mind.

 

The speaker also replied to the questions
posed to him by participants, some of whom had logged in from Australia, UK,
New Zealand, Gujarat and from Mumbai.

 

This presentation is available on the
Society’s link at: https://youtu.be/fgoTUSL8Wtc).

 

WEBINAR ON MSME

 

The Seminar, Public Relations and Membership
Development  Committee organised a
webinar on Micro, Small and Medium Enterprises (‘MSME’) jointly with the
Association of Chartered Accountants, Chennai; the Hindustan Chamber of
Commerce; Jain International Trade Organisation; and Southern India Rajasthani
Chamber of Commerce & Industry. The session was conducted online on 13th
June.

 

It started with an introductory speech by BCAS
President Manish Sampat who shared details about BCAS, its motto
and its activities. He also introduced the subject and its relevance in the
current times.

 

The first speaker was Anand Bathiya
who explained the context, scope and benefits of registration as an MSME. He
described the revised definition of MSME, the registration process, the
benefits and details of the various schemes for MSMEs, and key initiatives such
as the Atmanirbhar Scheme and the TReDS platform.

 

Chirag Doshi,
the second speaker, dwelt on Standard Operating Procedures for MSMEs and
explained the plan of action for revival of small enterprises post-opening
after lockdown due to Covid-19.

 

Taking up the third session, Mrinal Mehta
explained the tax provisions applicable to MSMEs. He discussed the various
tax incentives and schemes available under the direct and indirect tax regime
for MSMEs, including the reliefs in the statutory due dates announced by the
government due to Covid-19.

 

The panel of Coordinators posed the
questions asked by the participants and the speakers answered all of them in
detail.

 

The session was attended by more than 650
participants from all over the country. They were unanimous in stating that
they had benefited immensely from the knowledge and practical experience shared
by the speakers.

 

‘VIRTUAL’ STUDENTS STUDY CIRCLE

 

The Students Forum under the auspices of the
HRD Committee organised the second ‘Virtual’ Students Study Circle meeting on ‘Direct
Tax Annual Compliance-Revised Income Tax Return Forms’ on 19th
June via Zoom Meetings.

 

The Study Circle was led by Utsav Shah
and Samarth Patil who are experts on the subject. Azvi Khalid,
the student Coordinator, introduced the speakers and spoke about the
forthcoming student events. Raj Khona addressed the students and
encouraged them to actively participate in the events of the Students Forum.

 

Utsav Shah
briefed students about the basics of ITR and shared the revised due dates. He
presented latest amendments in the applicability of tax audit in a lucid manner
and explained various additions and deletions in the revised ITR Forms 1, 2, 3
and 4 in relation to income for ease of understanding.

 

Samarth Patil,
on the other hand, shared his insights on ITR Forms 5, 6 and 7. He also briefly
discussed the new tax regime, pass-through income, verification process,
transfer pricing and Form 26AS. He provided the students with an easy checklist
for selecting the correct ITR forms.

 

The interactive session ended with Vedant
Satya, Student Coordinator, proposing the vote of thanks to the speakers.

 

The session can be viewed on the BCAS YouTube Channel at:
https://youtu.be/1e7jKQ2DIK0.

 

WEBINAR ON
‘KEY FCRA AND TAX CHALLENGES…’

 

The Bombay Chartered Accountants’ Society
organised a webinar on ‘Key FCRA & Tax Challenges for NGOs & Public
Trusts’ jointly with DevelopAid, Mahavan and Save The Children, India. It
was conducted online on 20th June.

BCAS
President Manish Sampat set the ball rolling by sharing details of the Society.
He also introduced the subject and its relevance in contemporary times.

 

Speaker Sanjay Agarwal started by
describing the key challenges under the Foreign Contributions Regulations Act
(FCRA) with respect to Prior Permission, Registration, Cancellation, Renewal,
Affidavit, Fund-Raising, Board, Covid-19 and FC issues, filing Covid-19 forms,
separate books of accounts and refund of unspent funds. He explained all the
rules and regulations concerned in detail and answered the questions posed to
him.

 

In the second
part of the session, the speaker covered the issues under Income Tax relevant
to the NGOs and Trusts. He explained the reasons for cancellation of 12A
registration, grant or service contracts, limits of remuneration to trustees,
section 115TD – Penal Tax and payments, TDS issues for trusts, anonymous or
cash donations, issues in filing tax returns for trusts and so on.

 

The third part of the webinar focused on
issues under GST to be taken care of by trusts. The speaker covered the
registration limits, scope of taxable supply and so on.

 

Every presentation by Sanjay Agarwal
was followed by a detailed question-answer session.

 

This webinar was attended by more than 500
participants, including Trustees and Finance Managers of renowned trusts and
foundations, from all over the country who said they had benefited immensely
from the knowledge and practical experience shared by the speaker.

 

MOTIVATIONAL
MUSIC VIDEO

 

In these unprecedented times, each of us has
been dealing in our own ways with the challenges that life has been throwing at
us. But to boost the indomitable spirit lying dormant within one each of us, a
motivational music video has been released by our Yuva Shakti and Jyeshta
Shakti for the benefit of all. The intention was to give our performing
artists a platform to express their josh and motivate members to
defeat the pandemic through sheer determination of mind. The idea of making the
video germinated in the minds of President Manish Sampat and the
Chairman of the SPMRD Committee, Narayan Pasari.

 

While BCAS has been a trail-blazer
over the last seven decades, be it the residential refresher courses, the
workshops, the lecture meetings, the expert talks, etc., a music video is a
novelty and has never been done before.

 

But with the blessings of the Almighty,
things started falling in place and soon the song started taking shape… Vijay
Bhatt, a passionate musician, was roped in to lead the project. The need
for a Sutradhar was recognised early and the choice unanimously fell on
the Hon. Joint Secretary, Mihir Sheth, who enthusiastically penned the
lines and delivered them in his inimitable baritone.

 

The lyrics were penned by Past President Mayur
Nayak over the span of an evening and the inspirational words were set to
music by Vijay Bhatt and others. The singers included our Yuva Shakti
members – Aditya Phadke, Devansh Doshi, Kartik Srinivasan,
Parita Shah, Ryan Fernandes, Tej Bhatt and the winner of
the singing competition at Tarang 2019, Vani Srinivasan;
they were ably supported by Vijay Bhatt and Mayur Nayak.

 

The Office-Bearers of the BCAS and
the Committee torch-bearers also enthusiastically participated in the music
video in colourful traditional attire. Over the next three weeks the video was
shot with the support of family members / colleagues as the location for the
shoot was either their homes or offices; social distancing norms were
maintained while learning and recording the assigned lines – some in the dead
of the night when the little one finally fell asleep, others at the crack of
dawn when all was quiet! In the capable hands of the video editor, ACCA Anirudh
Parthasarthy, the video came to life, interspersed with visuals from the
many social events organised by BCAS over the years.

 

After a teaser was put out to announce the
impending release of the video, on 29th June, 2020 history was made
with BCAS releasing its first-ever motivational music video.

 

The Chairman of the SPRMD Committee, Narayan
Pasari welcomed the participants, while President Manish Sampat and
Vice-President Suhas Paranjpe shared their thoughts on the video and the
work done by the Committee over the past one year.

 

Chairman Narayan
Pasari revealed the idea behind the video, while Vijay Bhatt shed
light on the idea and the efforts that went into making it. The video was then
officially released by the President. Manmohan Sharma, Convener of the
SPRMD Committee, proposed the vote of thanks to all who were involved in the
making of the video.

 

A lot of efforts were put in by all the
performers for the video which was made under lockdown conditions and with the
help of personal devices. They did all this because of their passion for music.
A big applause for their efforts.

 

Given the lockdown restrictions still in
place, the entire proceedings were held online… and while all sat in their
respective homes / offices, the song and the journey behind it wove a magical
spell around the participants, bringing them (virtually) close to one another.

SOCIETY NEWS

 

BCAS
YouTube Views

 

 

 

 

 

1.         Traffic Source : YouTube traffic
sources include sources from which viewers are coming to the channel and viewing
videos.

2.         Subscriber: This pie graph indicates,
of the total videos viewed, percentage of videos watched by subscribers.

3.         Device Type: This chart highlights most
preferred gadget for the viewer to watch videos of BCAS Channel.

4.         Most viewed videos: This is the list of
top 10 most viewed videos from 21st March to 14th
December, 2020.

5.  Demographic
Profile of the viewer: This graph highlights the age group BCAS attracts
to its channel.

 

 

SOCIETY NEWS

FEMA STUDY CIRCLE MEETINGS

 

In October, 2020, the FEMA
Study Circle of the BCAS organised three meetings, details of which are
as follows:

 

1. Downstream investments

 

The virtual meeting was led
by Kartik Badiani, Aarti Karwande and Sneh Bhuta and was held on
17th October, 2020.

 

The speakers started by
explaining the basics of Foreign Direct Investment and Indirect Foreign
Investment. Next, they delved into the types of entities that are eligible to
undertake Indirect Foreign Investment and the manner of calculating Direct as
well as Indirect Foreign Investment. This was followed by a detailed
explanation on the various compliance and reporting requirements – as well as
consequences of non-compliance.

 

The presentation was
replete with case studies that not only made it interesting but also evoked
questions from members.

 

2. Amendments to the Foreign Contributions
(Regulation) Act, 2010

 

This virtual meeting was
held on 19th October and was led by Isha Sekhri.

 

It was
held in light of the recent amendments to the Act that came into force on 29th
September. Isha discussed various amendments pertaining to the
restriction on acceptance of foreign contributions by public servants,
prohibition on transfer of funds and the cap on administrative expenses at 20%,
amongst others, in a very crisp, eloquent manner.

 

The session was indeed
helpful as members felt they were better equipped to handle queries from their
clients on the manner in which they need to adapt to the recent amendments.


3. Structuring of
investments in Startups

Ganesh
Ramaswamy led this meeting which was held on 31st October.

 

The
speaker explained the concept of a Startup and the various facets associated
with it, viz., investments by Foreign Venture Capital Investors (FVCI), issuance of Convertible Notes, FDI in Startups, amongst others.

 

He
explained in detail tax aspects pertaining to various jurisdictions, viz.,
Germany, Switzerland, the United Kingdom, the United States of America and the
Netherlands to name a few. The presentation was made more interesting with
anecdotes about his experiences with clients of different countries and the
people there.

 

COVID IMPACT ON ECONOMY AND CAPITAL MARKETS

 

A virtual panel discussion
on ‘Post-Covid Impact on Economy and Capital Markets’ was organised on 28th
October. The panellists were Dr. B.K. Bhoir (ex-RBI and an Economist), T.N.
Manoharan (Past President of the ICAI) and George Joseph (CEO of an
ITI AMC). The panel was moderated by Dipan Mehta.

 

President
Suhas Paranjpe welcomed the panellists and spoke about the devastating
impact of the Covid-19 pandemic on industries, businesses – small and large,
the financial markets and the speculation about the V/U/L/H-shaped recovery in
the economy post the devastating contraction in the Indian economy. Speaking
about the expectations of stimulus packages, he also discussed the need for a
direction as to where the economy was headed and said that this was the theme
for the lecture meeting.

 

Vice-President Abhay
Mehta introduced the panel members and handed over the proceedings to
moderator Dipan Mehta.

Each of the panellists gave
a brief overview. In his presentation, Dr. Bhoir pointed out that the
public at large is only discussing the impact of Covid on the GDP; however, its
impact had been far more devastating and far-reaching. It had impacted the
social fabric and the personal and mental well-being of the people at large.

 

He also noted the GDP
forecasts being made by various agencies and contrasted the same with his own
forecast and the reasons for the same. He also gave his prescription for the
way forward and the challenges that the government is likely to face in the
coming days.

 

T.N.
Manoharan highlighted the positives from the pandemic and how virtual
webinars were helping increase the spread of knowledge. At the same time,
despite the pandemic, several sectors had been growing, such as telecom,
healthcare, drugs and pharma, financial services, agriculture, food processing,
agricultural implements like tractors, automobiles, power generation, etc.

 

He pointed out how some
sectors had adapted to the scenario and grown despite the challenges – a case
in point being resorts. He ended his talk by hoping that the worst was over and
prayed that the vaccine would be available soon.

 

George
Joseph started his overview by pointing out that there were no
precedents to the current situation and the closest he could cite was in the
1820s; he remarked that it was surprising that 100 years later the manner in
which the extreme situation was being dealt with was strikingly similar.
Covid-19 had been a traumatic experience for the people at large but now they
were venturing out.

 

Referring to the historical
data, he said that by 2010 the economy had started to slow down; various
factors had contributed to that; and then there were a series of steps taken by
the government such as demonetisation, GST implementation, etc., which had
their impact on the economy – all these followed by a series of crises such as
the NBFC and other crises. But despite these negatives he was optimistic that
the Indian economy would rise and start growing since the protracted down-cycle
had ended and he expected a boom considering that the manufacturing cycle was
gathering momentum, and both the Chinese and the American economies were showing
positive indications. He expected the Indian economy to grow at a phenomenal
pace in the foreseeable future. If a stimulus package came through, it would
further assist in the growth of the economy.

Dipan
Mehta then proceeded with questions to each of the panellists. These
ranged from aspects such as interest rates, thrust of the stimulus, impact of
moratorium on loans on the banks, increase in bank deposits and slowing down in
the investment cycle, recognition of NPAs, restructuring of failing businesses,
how to attract fresh investments, need for a fiscal stimulus, movement in
interest rates, likelihood of a second wave of Covid-19 and its impact, and the
way forward.

 

Joint Secretary Mihir
Sheth proposed the vote of thanks.

 

ARTIFICIAL INTELLIGENCE – DEVELOPMENTS IN FINANCE,
ACCOUNTING & AUDITING

 

An unusual Zoom meeting was
organised on 4th November. It was a 
virtual lecture on ‘Artificial Intelligence – Developments in Finance,
Accounting & Auditing’. The faculty was Mr. Rohit Gupta who
delivered his talk live from the USA.

 

In his opening remarks,
President Suhas Paranjpe presented an overview of the increasing
prevalence and growing importance of Artificial Intelligence in the finance
world in general and in the field of financial accounting in particular.

 

Mr. Gupta
covered the following areas of interest:

 

  •    What is AI and why is it
    relevant today?
  •    The opportunities with AI
    in corporate finance;
  •    The journey to AI-driven
    Digital Transformation; and
  •    Practical approaches to
    adopting AI-driven Digital Transformation
    for Finance.

 

In the course of his
lecture, he discussed various concepts such as Natural Language Processing,
Computer Vision, Machine Learning and Deep Learning.

 

At the end of his talk, Mr.
Gupta answered the queries of the participants such as the first steps to
learning and adopting AI, various avenues for learning about AI, the
opportunities and so on.

 

The virtual lecture meeting
was attended by 250 participants (both on Zoom and on YouTube).

 

PRIMARY FINANCIAL STATEMENTS (PFS) PROJECT

Another virtual lecture
meeting, this time on the Primary Financial Statements (PFSs) Project of IASB,
was held on 11th November.

 

The
keynote speaker was M.P. Vijay Kumar (ICAI Council Member) and the faculty
comprised Ms Aida Vatrenjak (Member of the Technical team and leader of
the PFS project) and Ms Nili Shah (Executive Technical Director).

 

President Suhas Paranjpe
gave the opening remarks and presented an overview about the PFS, including the
fact that the initiative aimed at reducing the variations in financial
reporting by standardising the presentation and the form of the reports and
making financial statements more comparable.

 

Immediate Past President Manish
Sampat, giving the background of the subject, highlighted the hurdles faced
by various stakeholders while reading financial statements and the pressing
need for conformity.

 

M.P. Vijay
Kumar started his keynote address by acknowledging the efforts of
various contributors to the project. He emphasised that he was a firm believer
in the dictum that the concept of accounting was to be accountable and
financial reporting was all about communication.

Financial reporting had to
focus on the three Cs – it had to be Clear, Complete and Candid, he added.

 

On her
part, Ms Nili Shah introduced the project and said that it had resulted
in the exposure draft on general presentation and disclosures. She also spoke
about the developments leading to the project and its current stage.

 

Ms Shah
stressed on the need for interaction and discussion on the subject since this
would assist in framing the standard. She spoke in detail about the project,
the terms used and their relevance in financial reporting.

 

Ms Aida Vatrenjak, on the
other hand, discussed the need for having rules related to sub-totals and
categories that would help in achieving consistency and how the lack of such
rules was a disadvantage. The importance of various categories such as
operating profits, income and expense from integral associations and joint
ventures, profit before financing and tax, application to financial entities,
unusual expense, management performance measures, etc., were also highlighted
by her.

 

The lecture meeting was attended by several seniors in the
profession and members in practice.

SOCIETY NEWS

TACKLING COMPLEX TAX LAWS

 

The International Taxation
Committee conducted a virtual Study Circle meeting on ‘Reading of Treaty, Treaty Applicability, Overall Construction of
the Treaty, Interplay with MLI’ on 4th
September, 2020. It was led by Group Leader Dr.
Mayur Nayak who covered the subject in detail.

 

Tax laws in India were
becoming more and more complex. Occurrences such as the globalisation of
economies, signing and review of tax treaties, increase in the number of
cross-border transactions, mergers, acquisitions, transfer pricing, etc., were
adding to the complexities. To assist our members, the BCAS organised this Study Circle meeting to help
them understand the structure, construction and implications of tax treaties
and their interplay with Multilateral Instruments (MLI).

 

Dr.
Mayur Nayak shed new light on the ever-evolving subject and the participants
benefited from the insights shared by him.

 

TWO-PART SESSION ON ‘ZERO MEDICINE’

 

The HRD Study Circle
arranged a two-part presentation on an unusual subject – ‘Zero Medicine Wisdom’, by Mr. Saify Saraiya. Both sessions were held
online and attracted eager participation by members.

 

The first session was held
on 15th September at which the

speakers demonstrated that
‘abnormal’ experiences such as pain, fever, cold, cough, vomiting, nausea,
diarrhoea, allergy and dizziness are symptoms guided by the mind to enable the
body to take rest and let it go through the process of smooth, eventual
healing.

 

He highlighted the ‘Healing
Symptoms of Diseases’ in the following manner:

 

Pain            Guides the body

Fever           Fights the disease force

Cold            Protects the lungs

Allergy        Radiates away bad energy

Vomiting     Ejects toxic energy

Diarrhoea    Flushes out toxic waste

Dizziness    Puts you on hold to take rest

 

The message that these
symptoms conveyed were like a billboard that read: ‘STOP!
WORK IN PROGRESS’, which means giving rest to the body to help
it overcome the symptoms and implying that healing is going on.

 

Why
‘No’ to Medicine?

 

By ‘medicine’ we refer to a
non-biological chemical formula prepared to numb our system and adjust the
symptoms of disease for a while. Such medicine lets a disease condition
progress due to the absence of reactions against the disease.

 

We treat sleeplessness with
narcotics, depression with antidepressants, inflammation with
anti-inflammatories, pain with analgesics, fever with anti-fever drugs and
allergy with anti-allergy drugs. We question the use of drugs claiming to
prevent diseases that result in diminished resistance and side-effects giving
momentum to newer infections that advance into syndromes.

 

We realise the truth in the
radical message of ‘Zero Medicine Wisdom’ as it links directly with our life
experience and because we are not able to see through our various blindfolds
like conditioned upbringing, materialistic education, traditions, beliefs and
social influences.

 

The root cause of all
disease is the Mind. The mind controls the body. Bodily discomfort is due to what
is happening in the mind. Therefore, to cure the body is to cure the mind.

 

The mind is violated by the
loss of ease, thus the word ‘dis-ease’. We violate our mind when we respond to
situations in a manner that produces negative emotions. For example, when our
response to a situation causes anger, worry, fear, sorrow or stress, then that,
in turn, affects a particular organ in the body:

 

WORRY affects the STOMACH

FEAR damages the KIDNEYS

GRIEF affects the LUNGS

ANGER harms the LIVER

STRESS puts the HEART in
trouble

 

The session was lively and
interactive and the participants requested a follow-up session, which was
acceded to. Study Circle Convener Ms Gracy Mendes
ended the proceedings with a vote of thanks.

 

Accordingly, the second
session of ‘Zero Medicine Wisdom’ was
organised on 22nd September and saw more panellists taking part in
it.

 

Mr.
Saify Saraiya kicked off the proceedings along with the
other panellists, Ms. Farzana from
Chennai, Mr. Juzer from Doha, Mr. Sanjay from Kolkata and Mr. Sreejith from Cochin. It was a treat to
hear the panellists intersperse the session with wisdom from all religions and
orders, including a Kabir Doha
(Swas mein Ishwar), Aham
Brahmasmi, Bismillah and so on.

 

Mr.
Saraiya continued with the list of negative emotions such as anger,
jealousy and hatred leading to various forms of disease. He pointed out that
the eradication of diseases from mother earth is possible if mankind decides to
unlearn certain things.

 

Six matrix norms were
explained with birth, different dresses, learning and unlearning in simple
terms and with examples. The speaker shared the distilled wisdom of the ages
citing Bismillah and the Vishnu sahasranamah and also a popular old
film song, ‘Lakh dukhon ki ek dawa’.

 

Panellists Sanjay, Farzana and Siraj
shared their knowledge of the seven layers of the body, of the Atma, soul or Ruh,
and how believers in God can control the body with intelligence and conquer
diseases.

 

The second session, too, was interesting and interactive
and the participants requested yet another follow-up session.

 

 

A ‘kakistocracy’ is a system where the government is
run by the worst, least qualified or most unscrupulous citizens

— @fact

SOCIETY NEWS

WEBINAR ON
‘CLOUD SOLUTION’

 

The Technology Committee of the BCAS
organised a webinar on ‘Cloud Solution by Google and Microsoft’ on Saturday, 25th
July, 2020.

 

Mr. Juned
Kasmani, a Google Sales
‘Certified Professional’ having an experience of more than ten years in the
cloud industry and in Google Cloud, gave an overview of G-Suite and compared it
with MS Office 365 relevant to the professionals. He also gave a glimpse of the
management interface and administrative control of G-Suite.

 

Mr. Kasmani also
shared a demo on the productivity apps for creating and collaborating documents
on the Cloud and showcased the various corporate communication tools available
to practitioners.

 

He was joined by Mr. Punit Thakkar,
CEO of Shivaami Solutions, who answered all the questions posed by the
participants and also ran a live demo of the G-Suite and MS Office
applications.

 

The session was interactive and the speakers
concentrated on:

1.  Introduction and comparison of G-Suite and
Office 365,

2.  Business email and shared calendaring
services,

3.  Corporate communication tools,

4.  Productivity apps for creating and
collaborating,

5.  Google Drive vs. One Drive based on online
storage, with shared space for collaboration along with security features,

6.  Comparisons based on offering and price
points,

7.  Solutions by third party service providers.

 

The participants gained insights into
G-Suite and MS Office 365 applications and learned new ways of working more effectively
in an evolving and changing professional services and regulatory environment.

 

SOFTWARE
FOR GST

 

The Suburban Study Circle along with the
Technology Initiatives Committee conducted an online meeting styled ‘Excel –
GST ki Jugalbandi’ on 5th September. The meeting was led by Sandeep
Modi.

 

The speaker demonstrated many Excel Tips and
Tricks for effective preparation and compilation of data for filing GST
returns. The following issues were discussed:

 

(i)    Look Up Magic,

(ii)   How to handle frequent
updating of client data in
       Excel,

(iii)  Date format issues,

(iv)  Tricks / Automating GSTR1,

(v)   GSTR2 & Purchase Reconciliation,

(vi)  Shortcuts in filing GSTR3B,

(vii) GST Liability Calculation Sheet.

 

Sandeep Modi
also shared Excel templates with the participants for future reference and use.
The personal working experiences in Excel for filing GST returns, issues faced
and their solutions will be of immense help to the participants.

 

There were more than 140 participants on
Zoom and 300 on YouTube who attended and imbibed the knowledge that was shared.
The speaker answered all the questions raised by the participants in the
session.

 

 

Let us learn to appreciate there
will be times when the trees will be bare, and look forward to the time when we
may pick the fruit

— 
Anton Chekhov

SOCIETY NEWS

MEETING ON ‘EQUALISATION LEVY 2.0’

 

The International Taxation
Committee conducted a virtual meeting on ‘Equalisation Levy – Finance Act,
2020 Amendments’ on 27th July, 2020. The meeting was led by Group
Leader Bhaumik Goda who explained the amendments in the Finance Act,
2020 in relation to the Equalisation Levy (EL).

 

The new business models
were facing a set of new tax challenges in terms of nexus, characterisation and
valuation of data and user contribution. Thus, there was a continuous need to
hone the working knowledge of taxation. It was in view of this that the group
discussion at the ITF Study Circle was organised and led by Bhaumik Goda.

 

In the course of the
meeting, he dealt with and discussed the EL legislation, the definition of
E-commerce operator, E-commerce supply or services, exemption and charge of EL.
Case studies pertaining to different industries were also brought up and
discussed to explain various features and the impact of EL. Participants said
that they had received several critical insights at the meeting.

 

ACCOUNTING SOFTWARE EXPLAINED

 

The Technology Initiatives
Committee of the BCAS conducted a webinar on ‘Hidden Gems of Tally ERP9
– Reports and Add-ons’ on 1st August. The meeting was led by Punit
Mehta and Abhay Gadiya.

 

Punit Mehta explained the structure of Tally ERP9 Data for MIS
purposes. He also demonstrated the process of extracting the data with the use
of specialised tools. Certain add-on features of Tally for auto bank
reconciliation, copy of masters from one Tally account to another, auto
generation of similar entries through templates and so on were also explained.

 

Abhay Gadiya described the process of using the data extracted from
Tally for analysing and visualising in Power BI. The practical case studies
were very helpful in understanding the various graphics and charts that can be
created using Power BI. Both speakers replied in detail to the queries raised
by the attendees.

 

The live session was
attended by more than 700 participants on Zoom and YouTube. They appreciated
the efforts put in by the speakers.

 

24TH ‘ITF CONFERENCE 2020’ HELD ONLINE

 

This year’s International
Tax and Finance Conference was conducted online from 6th to 9th
August (with extended sessions on 14th and 15th August)
with a record attendance of 363 members from around 23 locations all over India
and abroad. The Conference was top-lined by experts from their respective
fields who dealt with their subjects with great clarity. The four-day
Conference was marked by seven technical sessions that included two group
discussion papers, one presentation, one expert chat and three panel
discussions.

 

There were a total of 23
faculty members, including speakers and session chairpersons, 16 group leaders
and about 30 contributors for case studies and the background material. It
clocked around 30 hours of solid study during the Conference.

 

Participants were divided
into six groups for group discussion on two papers written by Padamchand
Khincha and Geeta Jani. Six breakaway rooms were created on the Zoom
platform and participants were seamlessly divided into different groups upon
their entry. About 16 leaders led the groups and helped generate in-depth
discussion of the case studies from the papers. Both the paper writers had a
virtual tour of each group to see the discussion by the participants.

 

President Suhas
Paranjpe gave his opening remarks and explained some major BCAS
activities and its new initiatives. International Taxation Committee Chairman Dr.
Mayur B. Nayak welcomed the participants and set the tone with his
introductory remarks.

 

The Conference was
inaugurated with a keynote address by Hon’ble Justice Vibhu Bakhru of
the Delhi High Court who spoke about the role of the taxpayer and the tax
authorities in today’s scenario.

 

Following the group
discussion on the issue, Padamchand Khincha in his presentation spread
over two sessions totalling six hours on ‘Practical application of the MLI in
relation to PE’, highlighted the issues in the interpretation of MLI and its
application on Permanent Establishment and the nuances of the interplay of the
MLI and synthesised text on specific tax treaties. Past President Kishor
Karia chaired both the sessions and gave his valuable inputs on the
subject.

 

FEMA has become
increasingly complex and there are a host of issues which one needs to analyse
when dealing with any transaction that attracts it. A panel consisting of Mr.
G. Padmanabhan, former Executive Director of the RBI, along with Hitesh
Gajaria and Dr. Anup Shah and moderated by Past President Dilip
J. Thakkar, shared its thoughts and offered insights on specific issues in
FEMA through case studies. These studies covered practical issues which would
be of relevance in today’s scenario such as implications of a returning OCI to
India, the recent circular by the Government to allow FDI from China only under
the approval route, downstream investments, agricultural income, ECB and
write-off of import payable against export receivable, and so on.

 

Gautam Doshi spoke on ‘Structuring of Outbound Transactions (tax and
non-tax aspects)’. He covered, in a succinct manner, the various tax and other
regulatory issues arising in setting up an SPV abroad as well as
externalisation of the family holding through a foreign trust. Past President Gautam
Nayak chaired the session and also provided his insights on the subject.

 

Taxation of the digitised
economy is a hot topic with the world trying to find a consensus to enable
taxation of the highly-digitised businesses, even as a host of countries
including India have undertaken unilateral measures in this respect. Mr. Sam
Sim, board member of the Tax Executive Institute in Singapore, in his
presentation covered various measures undertaken by different jurisdictions and
also shared his thoughts on some of the alternative approaches available.

 

Rashmin Sanghvi, in his presentation, covered the potential trade war on
account of various measures adopted by the countries and the role of the US in
the same. He also gave his views on the shortcomings of Pillar 1 of the Unified
Approach propagated by the OECD and currently being discussed by various countries.
This was followed by a panel discussion featuring Mr. Sam Sim, Rashmin
Sanghvi, Mr. Mukesh Butani (advocate) and Shefali Goradia and chaired
by Mr. K. Vaitheeswaran (advocate). The panel deliberated on the issue
at length and provided its views on various facets in the Indian approach to
taxing the digitised economy such as the Equalisation Levy, the significant
economic presence and the extended source rule. Mr. Vaitheeswaran gave his valuable inputs and comments on several
issues.

 

The group discussion on
the paper written by Geeta Jani on ‘Case studies on impact of MLI on
select tax treaties with special emphasis on taxation of dividends’ took place
on 8th August. In her presentation, which followed the group
discussion, she brought out the various nuances in the application of the GAAR,
LOB and PPT provisions in respect of dividend payments as well as the interplay
of the MFN clause with the PPT provisions. Her presentation was based on case
studies for easy understanding in an online format. The session was chaired by Sushil
Lakhani who also offered his views on the issue.

 

Mutual Agreement Procedure
(MAP) has gained significance due to the complex rules of various countries. T.P.
Ostwal and Mr. Rajat Bansal, IRS, in an expert chat took the
participants through the MAP provisions and also shared their views on the
practical aspects of the MAP procedure, how to apply for the same and India’s
position in relation to the use of MAP as an effective tool for dispute
resolution.

 

The
last technical session was a panel discussion on ‘Case Studies on International
Taxation’. The panel consisted of Mr. Pramod Kumar, Vice-President of the
ITAT, Mr. Kamlesh Varshney, IRS, and Mr. Ajay Vohra, senior
advocate. It was chaired by Pranav Satya. It was quite a unique
discussion in that the panellists discussed issues from different possible
perspectives.


The issues discussed covered a range of topics of relevance in today’s world –
application of tax treaty
to DDT, royalty / FTS vs. EL, EL on E-commerce transactions, beneficial owner,
applicability of GAAR to indirect transfer, foreign tax credit and hybrid
entities. The panel was gracious enough to take part in another session on 15th
August which also lasted two and a half hours.

 

In addition, there were
two non-technical programmes for the participants – a musical programme by Nishant
Gadhok and a Hasya Kavi Sammelan by Mr. Mahesh Dube and
Mrs. Savitri Kocher.

 

While the personal touch
and the camaraderie amongst the participants during physical Conferences were
certainly missed, the participants were compensated by the experts’ views
shared at the virtual Conference.

 

Incidentally, this was the
first Residential Refresher Course of the BCAS and the International
Taxation Committee in its true sense and meaning, where delegates participated
from their respective residences!

 

Mahesh Nayak was the chief coordinator and was ably assisted by Abbas
Jaorawala as joint coordinator. The other members of the team were Ganesh
Rajgopalan, Bhaumik Goda, Rutvik Sanghvi, Siddharth Banwat and Rajesh P.
Shah.

 

The Conference received an
encouraging response and feedback from the participants.

 

 

The 13th Jal
Erach Dastur CA Students’ Annual Day – ‘Tarang 2020’ was held online on
Zoom Cloud Meetings and broadcast live on YouTube on Sunday, 9th
August, by the BCAS Students’ Forum under the auspices of the Human
Resource Development Committee.

 

Taking Tarang
online for the first time involved several experiments but the long days and
longer nights of adaptation and innovation, technical checks and video call
meetings brought together over 650 students from across the country to prove
once again that CA students think about a lot more than just tax and audit. The
student coordinators Drishti Bajaj and Azvi Khalid took the lead
in the organisation.

 

The participants for ‘Talk
Hawk’ and the ‘Talent Show’ sent their audition entries as pre-recorded videos
and later performed live. Two new events were introduced this year – a ‘Quiz’
and a ‘Research Paper’ competition. Apart from these, Tarang also
featured an Antakshari competition, a talent show and an elocution
competition, resulting in a lifetime of learnings and memories. The theme for Tarang
this year was ‘Bollywood Retro’.

 

The event was sponsored by
Mr. Sohrab Dastur in memory of his brother, the Late Mr. Jal Erach
Dastur. The Students’ Forum comprised of a group of 25 dedicated and
enthusiastic students. The event was truly an event ‘OF CA STUDENTS, FOR CA
STUDENTS AND BY CA STUDENTS’. It imparted necessary life skills such as
public speaking, management and marketing skills, and even technical skills.

 

BCAS President Suhas Paranjpe and HRD Committee
Chairman Govind Goyal gave their inaugural speeches which were
motivating and lauded the students for participating in the event which
commenced with a prayer song to ensure a positive beginning.

 

The two finalist teams of
the lively Antakshari competition, styled ‘Suron ke Maharathi’ (or
‘Zoomtakshri’) were ‘Deewane’ and ‘Parwane’. They took over everyone’s screens
and hearts. The Antakshari held true to this year’s theme of ‘Bollywood
Retro’ and the quick-thinking and accuracy of the participants during the game
that has been played by every Indian household was both a surprise and a
delight.

 

The next event was the
quiz ‘inQUIZitive – Eureka Moments’ wherein the ten finalists were divided into
five teams (these were previously chosen after two elimination rounds). The
quiz was hosted by student Parth Patani. Everyone got a ‘KBC feel’ as
the participants answered question after question at astonishing speed,
managing to keep everyone hooked on to the screen.

 

The end of the
brainstorming quiz session led to the start of the signature event, ‘Talk
Hawk’, wherein the five finalists had to give a four-minute ‘Ted Talk’ on one
of the following topics:

 

1. Waiting is the hardest
part of life

2. Fringe benefits of
failure

3. Doing things we don’t
enjoy is discipline.

 

The viewers could feel the
energy of each of the speakers bursting forth from the comfort of their homes.
The insight and perspective that each person offered was encouraging. The
confidence and manner of delivering their thoughts was captivating.

 

And then it was time to
announce the winners of the research paper contest for ‘Writopedia’. The topics
offered were:

 

1. WHO Controversy – Lack
of Global Leadership in the Corona Crisis

2. How the Goals of
Feminists have Changed over the Decade

3. Can Encounters be used
to Bypass the Indian Judicial System

4. Untapped Potential of
North-Eastern States of India.

 

The judges shared their
thoughts on how they were surprised to go through several well-written papers.
They also described the building blocks of a well-written research paper and
how it was different from an essay.

 

Last, but not the least,
it was time for ‘CAs Got Talent’ wherein three persons each from the categories
singing, dancing and other performing arts helped make the evening entertaining,
leaving the participants asking for more. One inherent benefit of the online
competition this year was that initial entries from over 130 students were
received for various presentations, such as mono-acting, yoga, rapping, etc.,
bringing out the hidden talent of CA students. The judges had a hard time
finalising the top 12, let alone deciding the winners.

 

The winners were then
announced, each representing their firms, as follows:

 

Research Paper Competition
– ‘Writopedia’

Prize

Name
of Student

Name
of Firm

City

1st Prize Winner

Vedant Satya

CA student

Lucknow

2nd Prize Winner

Priya D’Costa

Vishwanathan Subramanian

Mumbai

 

 

Talk Hawk – ‘Aspire to
Inspire’

Prize

Name
of Student

Name
of Firm

City

1st Prize Winner

Tanmay Modi

K.C. Mehta and Co

Vadodara

2nd Prize Winner

Vanishree Srinivasan

Singhvi Oturkar Kelkar

Thane

 

 

Talent Show ‘CA’s Got
Talent’

Prize

Name of Student

Name of Firm

City

1st Prize
(Singing Category)

Vanishree Srinivasan

Singhvi Oturkar Kelkar

Thane

1st Prize (Others Category)

Prakhar Gupta

D.K. Surana & Associates

Indore

1st Prize (Dancing Category)

Sanjana Subramanian

          
–

Mumbai


Antakshari Competition –
‘Suro ke Maharathi’

Prize

Name
of Student

Name
of Firm

City

Winning Team

 

 

Best Individual Performer

Jagat Dave

Dipen Mehta & Co.

Mumbai

Nisarg Shah

–

Mumbai

Bidisha Banerjee

–

Kolkata

Jagat Dave

Dipen Mehta & Co.

Mumbai

 

Quiz – ‘inQUIZitive’

Prize

Name
of Student

Name
of Firm

City

Winning Team

 

Best Individual Performer

Kalpak Masalia

CA student

Pune

Mangesh Pai

CA student

Mumbai

Akash Sagar

–

Lucknow

 

 

Hearty
Congratulations to all the winners and their firms.

 

The judges for the various
competitions were as follows:

Competition

Level
1

Elimination
Rounds

Final
Round

Writopedia

Nikunj Shah
Raman Jokhakar

Talk Hawk

Apurva Wani
Mukesh Trivedi

Rajesh Muni
Mihir Sheth

Narayan Pasari
Mayur Nayak
Mudit Yadav

Antakshari

Yogesh Arya (Judge), Nidhi Shah (Judge)
Vijay Bhatt (Host), Meena Shah (Host), Tej Bhatt (Host)

Talent Show

Hrudyesh Pankhania,
Tanvi Parekh

Rishikesh Joshi
Devansh Doshi
Parita Shah

Mihir Sheth
Aditya Phadke

 

Mr. Soham Pandya, a member of the technical team that held the event
together, proposed the vote of thanks to Mr. Dastur’s family, the Office
Bearers, the Managing Committee and HRD Committee members, the coordinators of
the Annual Day, the BCAS staff, the creative, social media and technical
teams, the vibrant team of student volunteers and all the students for
participating in big numbers.

 

With
another successful Tarang held, this time in a new format, it was an
unprecedented experience for the students who put up a great show in these
challenging times.

 

Mr. Dastur watched the event live on YouTube and was overwhelmed
with the performances. BCAS is honoured to receive the following letter
of appreciation from him:


 

 

‘TUNE INTO YOUR EMOTIONS’

The HRD Study Circle meeting
was held on 11th August with a session on ‘Tune into your Emotions
and Bounce back with Resilience’ presented by Leonie D’Mello, an
experienced counsellor, behavioural trainer and energy healer.

 

The session covered the
basics of Emotional Intelligence. The icebreaker, when participants were asked
to share what they were feeling at the moment, helped to bring home how we may
confuse our thoughts and feelings. Tuning into one’s emotions is to be able to
identify and be aware of one’s feelings. Self-awareness can then lead to other
awareness and social awareness. Self-awareness is necessary for self-management
and, together with social awareness, leads the way for effective relationship
management.

 

The session allowed
exploration of how we express our emotions. Taking responsibility for our
feelings and healthy expression is preferable since suppression of feelings
causes diseases.

 

Participants then shared
the feelings that they had experienced in the past four months of the pandemic
and lockdown. Most of these were difficult feelings as it had been a tough
period for each one of them. Light was thrown on the purpose of these difficult
feelings so that we understand why they are there, listen to the message that
they have for us and allow them to guide us to the best course of action – thus
enabling us to regain our mental equilibrium and tapping into the inner
strength of resilience to bounce back.

 

Being mindful of the
present moment and living in the here and now, reframing events and looking at
things from a different perspective enables us to regulate our feelings.
Nurturing ourselves and taking support from our near and dear ones and
embracing change are some of the ways in which we can build our resilience,
according to Leonie D’Mello

 

JOINT WEBINAR WITH IACC


Just slash the regime of
767 establishment approvals to fuel India’s post-Covid recovery through FDI,
several experts urged at the online webinar organised by the IACC in
association with the BCAS on 12th August on the topic ‘Investment
into India and the USA’. The economic slowdown due to the global pandemic
has made other countries think about China and its future strategy towards
global trade and commerce. For this, IACC brought together many industry
experts having rich experience in cross-border investments.

 

The eminent experts were Nishith
Desai, Founder and Partner, Nishith Desai & Associates; Sunil Kaul,
Managing Director and Head, Southeast Director Asia, Carlyle Group; Hoonar
Janu, Co-Head, Americas Region, Invest India; Dave Springsteen,
Partner, Withum; Timothy R. Lavender and Deepak Nambiar, Partners
at Kelley Drye; Kamlesh Vikamsey, Senior Partner, Khimji Kunverji &
Co.; and Rajesh Tripathi, Principal, US-India Corridor, Withum. Rajesh
Tripathi and Deepak Nambiar moderated the discussion.

 

Mr. Desai said that India needed to develop the art of
visualisation to uproot investments from China to India. The most critical
challenge was environmental policies. Similarly, India should become a heaven
to attract foreign investments, a rather difficult task. Some contrasting
trends had been seen in investment – investment in manufacturing and
infrastructure had taken some beating. Looking at services, there had been a
huge upsurge; technology, media and entertainment, telecom, pharma, healthcare,
medical devices, agrotech, IoT, financial services, especially insurance, were
catching up. The Government had opened the insurance sector for investment up
to 45%, but in case of intermediate investment it was allowed up to 100%.

 

Mr. Kaul said that India would be competing with other South-East
Asian countries for this chunk of business such as Vietnam which was very
welcoming to foreign companies. There was also the case of regulatory controls
and taxation policies. India had to simplify its tax systems and provide ease
and predictability in the tax and regulatory structures.

 

But standing in the way
(of inviting investment into the nation) was the lack of single-window
clearance for investors, said Naushad Panjwani, BCAS Past President and
also the Regional President of the IACC, West India Council. He narrated how
foreign businesses who sought to develop roots in India had to face a committee
of secretaries from 35 Central Ministries or Departments, apart from an overall
regime of 767 pre-operational licenses. Adding to this was the multitude of
inspections, approvals and renewals after the commencement of operations.

 

Mr. Vikamsey said the second piece in this puzzle was to find a
solution to the issue of tax on cross-border or international transactions. The
challenge in India was implementing and interpreting its plethora of good laws.
Several developments were taking place right now, offering better opportunities
for India. American businesses that were looking for better opportunities,
provided a chance for all, thanks to the large market here.

 

Ms Hoonar Janu said American ventures had spiked by four times in
pursuit of defence partnerships and three times for healthcare. That underlined the larger, strategic relationship,
all thanks to the economic strength of India.

 

The webinar was well
moderated by Rajesh Tripathi and Deepak Nambiar. The vote of
thanks was proposed by BCAS President Suhas Paranjpe.

 

‘CASE STUDIES ON GAAR’

 

The International Taxation
Committee conducted a virtual meeting on ‘Case Studies on GAAR’ on 24th
August. The discussions were led by Group Leader Rutvik Sanghavi who
explained the far-reaching practical impact of GAAR through relevant case
studies.

 

The concept of GAAR is
predominantly based on the concept of ‘substance over form.’ The Group Leaders began
the meeting by taking up a flow-chart of GAAR applications. They discussed the
key points to be kept in mind before concluding whether transactions were
GAAR-tainted. The speakers dealt with various case studies to explain the
conceptual aspects of GAAR.

 

It was an
interactive meeting and the participants said they had enormously benefited
from the discussions and insights provided during the same.

 

 

 

Great amount of scientific research is there to show
that health is better
because transcendental meditation deals with consciousness,
and consciousness is the basic value of all the physical expressions.
The entire creation is the expression of consciousness.

— 
Maharishi Mahesh Yogi

 

SOCIETY NEWS

‘JOURNEY TO YOUR MIND AND SOUL’

An HRD Study Circle Meeting was held online on 24th November, 2020 on a very unusual topic, ‘Journey to your Mind and Soul’. It was presented by Dr. Devang Shah and Dr. Sunita Gandhi.

The faculty started by explaining how illnesses are caused and how they are treated by studying the history of the patient and ‘visiting the aspects of their mind and soul’. They emphasised that thoughts are the main reason for a variety of illnesses. The presentation focused on the following:

Homoeopathy – A holistic system of medicine
Holism means that a homoeopath considers a patient as a whole. It is not like modern medicine where if you have a toothache you go to a dentist and if you have a joint ache, then you visit an orthopaedician. Homoeopathy considers all the symptoms, such as understanding the exact location of the pain, factors that modify the pain, the past history, family history and understanding the personality of the patient who is suffering from a particular problem (this is done through understanding the patient’s entire life in terms of fears, dreams, nature, stressful situations, saddest and most joyous occasions of life). And only after a thorough investigation is a suitable medicine selected for that particular problem of the patient.

This was illustrated by way of the following example: There are two patients suffering from acidity. Patient A says he feels burning in the stomach when he is hungry and he has to eat something to get better. During the acidity episode he becomes very irritable and does not want people to talk to him, HE desires peace and wants to be left alone. But Patient B when he suffers from acidity, feels better on having cold things like ice cream, cold milk, etc. During the attack of acidity he wants to be with someone, he wants to communicate and seeks assurance that there is nothing serious.

Thus, there is a stark difference between two people suffering from the same condition but the manner in which they cope with it, or rather react to it, is totally different. This difference is what a homoeopath tries to identify and, based on this, a suitable homoeopathic medicine is selected.

Normally, it is believed that only bacteria and viruses are the cause of illnesses. However, homoeopathy also believes that there are mental or emotional causes which have the potential to produce symptoms in the body which allopathic doctors call stress. Each person, depending upon his perception of the situation, tries to cope with these external circumstances.

The human body is capable of fighting its own battle. Only when this coping mechanism falls short of what is actually required, a suitable homoeopathic remedy selected after a detailed study has the potential to heal not only the physical problems but also the mental traumas that a person goes through.

LECTURE ON REVISED ‘CODE OF ETHICS’

The BCAS and the Pune Chartered Accountants’ Society (PCAS) jointly organised a virtual lecture meeting on ‘ICAI Code of Ethics’ on 10th March, 2021. President Suhas Paranjpe began the proceedings by welcoming the speaker, Mangesh Kinare, and the office-bearers of the PCAS. He also briefed the participants about the activities being conducted by the Society. Vice-President Abhay Mehta introduced the speaker.

Mangesh Kinare started by acknowledging the contribution of C.N. Vaze who has been speaking on CAs and Ethics on the BCAS platform for several years. He then explained the reason and the need for the formulation of the revised Code. The ICAI had issued the revised Code of Ethics in 2019 that was made effective with effect from 1st July, 2020. The need to do so had arisen owing to the ICAI becoming a member of the International Federation of Accountants; the revised Code was based on the International Ethics Standard Board of Accountants (IESBA) Code of Ethics, 2018 edition. The earlier 2009 Code with two parts, A and B, had been replaced by a Code spread over three volumes.

Volume I of the new Code deals with the theory of the Code; Volume II gives a practical scenario; and Volume III contains a glossary of cases decided by the ICAI which serves as a guidance to its members. In the course of the lecture, the speaker stressed on the need to understand the importance of the provisions in Volume II which require a CA to observe a certain Code of Ethics. Volume I of the Code states the negative actions in the sense of what should not be done, whereas Volume II suggests what needs to be done and how. He dwelt on the major changes that came in by virtue of Volume I of the Code and noted that the same are applicable both to a member in practice and one in industry. Some of the standards explained by him were as follows:
1. Fundamental principles of the Code, like integrity, objectivity, professional competence and due care, confidentiality and professional behaviour.
2. Threats in compliance of fundamental principles and safeguards from such threats.
3. Independence for audit and review engagements.
4. Independence for assurance engagements other than audit and review engagements.
5. Changes in professional appointment (section 320).
6. A new section dealing with ‘Management Responsibilities’ – that the firm shall not assume a management responsibility for an audit client.
7. Fees – Overdue (section 410) with respect to self-interest threats.
8. Regulation 191 of the CA Regulations – Chartered Accountants in practice to render entire range of ‘Management Consultancy and other Services’, under which category the Council has from time to time listed 28 different types of activities / services that a Chartered Accountant in practice can undertake.
9. Regulation 190A and Appendix 9 to CA Regulations, 1988.
10. A member in part-time practice.
11. HUF vis-à-vis member in practice – Position in the revised Code.
12. Sharing or receiving fees from a non-CA is forbidden under the new Code barring the persons who are members of the prescribed professional bodies under regulations 53A and 53B of the CA Regulations Act, 1988.

The speaker requested all CAs to read the ‘Independence Standards’ thoroughly considering the critical implication of the same. He emphasised that there should be no compromise on the independence of a CA. Management responsibilities under the new Code and the auditor’s responsibility were also highlighted.

He also explained the implicit provisions of Volume II. The penalties for misconduct are grave compared to the Volume I misconducts. He also explained the idea of ‘Director Simpliciter’ under the provisions of the CA Regulations Act, 1988, relevant for the new Code of Ethics. He lucidly explained the concept of independence, fees charged, due fees and many more such concepts and their implications on CAs with relevance to different statutes under the framework where a professional needs to discharge his / her responsibilities.

Mangesh Kinare ended the lecture with a quote from Swami Vivekananda: ‘In conflict between your heart and mind, follow your heart’ and related the Code of Ethics with the pandemic situation by stating that our ethics are our face and not masks. A brief question-answer session followed.

PCAS President Dinesh Gandhi proposed the vote of thanks. The entire meeting is available on YouTube @bcasglobal.

INTERNATIONAL WOMEN’S DAY

The International Women’s Day theme this year was ‘ChooseToChallenge’. A challenged world is an alert world and from challenge comes change. While challenges are not unique to women, the challenges faced by them are, in themselves, unique. BCAS this year endeavoured to provide a platform to its woman members to enable them to address their career-related challenges.

The Managing Committee, in association with the Seminar, Public Relations and Membership Development Committee and the Human Resources Development Committee, organised a unique event to celebrate the ‘International Women’s Day’ on 12th March.

The event was the brainchild of a senior member of the BCAS Core Group, Dr. Sangeeta Pandit. The main thrust of the event was to provide a voice and lend an ear to women across all ages and stages of their professional careers. Like all events of this past year, this one, too, was held on a virtual platform with registrations from places as far as Faridabad, Coimbatore and even Muscat. The event witnessed over 100 registrations, including from some erudite gentlemen.

Convener Preeti Cherian welcomed the gathering and briefed it about the events to follow. In his address, President Suhas Paranjpe commented on the significance of the event in the Indian context. The 10th of March marks the death anniversary of Savitribai Phule (1831-1897) who worked relentlessly against many odds for the cause of women’s empowerment. Today, she is recognised as one of the pioneers of women’s education in India. President Suhas also gave voice to a dream that many harbour – to see BCAS helmed by its first woman President.

The gauntlet was picked up by Vanishree Srinivasan, articled student and ‘Tarang’ contest finalist. She read out a Hindi poem, ‘Main adhunik naari hoon’ shared by Govind Goyal and followed it up with an energising song that helped set the tone of the evening.

Committee member Sneh Bhuta then introduced the distinguished panel comprising Bahroze Kamdin, Nandita Parekh, Mansi Jain and moderator Dr. Sangeeta Pandit.

Earlier, during the registration process, the participants had been asked three questions,
1. Your career journey so far
2. Your career aspirations
3. Your plan to achieve your aspirations

From the responses received, seven participants were selected to interact with the panellists. Their aspirations can be summarised as follows: establish their own brand and identity and also partner in the nation-building process; become a Fund Manager and then a Chief Investment Officer and leverage the position to create opportunities for talented women; specialise in financial accounting and reporting; balance commitment as a young mother by shifting to a less-demanding career while also chasing various passions in life; to be recognised as a leading voice in direct tax practice; to build a practice with young, dynamic women CAs as partners; to work for the benefit of the CA community.

The panellists suggested a few strategies and a roadmap that they could consider; this brought immense joy and satisfaction to the participants as was evident from the delighted expressions they wore and the words of gratitude they uttered.

Moderator Sangeeta, along with a Committee Member, Rimple Dedhia, then read out some interesting responses emailed by other participants who were looking to make a comeback after taking a break for family commitments: wanting to create a distinct identity other than the present one as an associate in a Big 4; aspiring to be a partner in one of the Big 4; considering a career in Internal Audit. The panellists deliberated upon these, too.

BCAS ran two poll questions during the event coordinated by Committee member Virag Shah. The first was, how satisfied are you with your present position? Here is a summary of the responses – 41% Extremely Happy; 54% Satisfied; and 4% Dissatisfied. The second question was whether the audience would be interested in a mentor-mentee programme by the BCAS – and this elicited an overwhelming response with 70% indicating their eagerness to sign up for the same!

In their concluding remarks, the panellists spoke with refreshing candour. Nandita Parekh emphasised on the need to enjoy each phase of one’s life and have an open dialogue – be it in personal life or at work; she reminded the audience that life is not a race, and to sit down once in a while and reflect on the journey thus far; she also suggested re-writing one’s CV every six months and if there was nothing exciting to add therein, to reflect on the same. Mansi Jain stressed on the need to find a niche or passion, identify areas to contribute and strengthen the ecosystem and partner in the nation-building process, adopt technology and develop one’s own financial plan. Bahroze Kamdin told the participants to dream big and plan appropriately, that life’s entire concept is doing what makes one happy; she quoted Einstein: ‘Weak people revenge. Strong people forgive. Intelligent people ignore.’

The routine Q&A session was followed by the surprise of the evening, viz., a rapid-fire round by the moderator who asked the panellists some very insightful questions which gave a sneak peek into their minds. Mansi Jain believes that work should also be fun and that social media is a necessary way to communicate; Nandita Parekh feels that emotional maturity and the ability to look at the bigger picture don’t come only with age; she also agrees that doing a relevant course is a good way to delve into technology faster; Bahroze Kamdin favours flexi-hours and remarked that while recruiting, the ability to communicate effectively also matters; she also agrees that office hours can also be used to discuss personal problems.

Virag Shah proposed the vote of thanks and requested everyone to fill the online feedback form.

The feedback from the participants has been extremely encouraging. With the release of the BCAS App, the Society hopes to bring many interesting and relevant woman-centric programmes within easy reach of members.

In the words of the American poet, memoirist and civil rights activist Maya Angelou, ‘Each time a woman stands up for herself, she stands up for all women.’ The distinguished panel and moderator and all the women that participated are indeed a testimony to that.

A MUNIFICENT DONATION

The Office-Bearers and members of the Managing Committee of the BCAS were pleasantly surprised recently by the noble gesture of a senior life member, Anilkumar Desai of Vadodara (BCAS Membership Number LD – 000047), who is aged about 77.

In a letter accompanying a cheque, he stated that he was donating a sum of Rs. 25,11,111 (Rupees twenty five lakhs eleven thousand one hundred and eleven only) towards the corpus fund of the Society. A portion of the said letter is being reproduced below.

Anilkumarji has been associated with the BCAS since 1970 and has been an active participant at the RRCs till the late 1980’s. His letter signifies his affection towards the CA fraternity associated with the BCAS. Apart from attending the RRCs, he has also been an avid reader of the Society’s monthly magazine, ‘The Bombay Chartered Accountant Journal’ (BCAJ), for more than 50 years.

During a brief interaction over a call with the President and the Vice-President who had called him to acknowledge his noble philanthropic gesture, Anilkumarji informed them that he has been a real beneficiary of knowledge-sharing through attending the RRCs and reading the Journal. Therefore, he wanted to give back to the Society that had provided him with such professional acumen.

Reading and understanding can take one to the pinnacle of success once these learnings are applied in performing one’s professional duties. And Anilkumarji is an apt illustration of this.

We express our heartfelt gratitude to Anilkumar Desai for such a noble gesture and the credit for this goes to all the volunteers of the BCAS.

KEY INTERNATIONAL TAX RULINGS

Advocate and Chartered Accountant Dr. Sunil M. Lala, a well-known tax counsel who has delivered many popular talks on international taxation, was the main speaker at the virtual lecture meeting on ‘Important International Tax Rulings (Post-2019)’ organised by the BCAS on 18th March. President Suhas Paranjpe set the ball rolling by welcoming the participants and Vice-President Abhay Mehta introduced the speaker.

Dr. Lala began by acknowledging Dr. Mayur Nayak, Chairman of the BCAS International Taxation Committee, and then went on to discuss ten judgments, five of the Supreme Court and the High Courts and five of various tax Tribunals. The judgments were on issues of permanent establishments, royalty, fees for technical services, capital gains, interest and foreign tax credit.

He started by explaining the intricacies of the ruling of the Supreme Court in Union of India vs. U.A.E. Exchange Centre [2020] 116 taxman.com 379 [SC]. All four liaison offices of the assessee in India were opened by the UAE Exchange Centre with the approval of the RBI to carry out financial transactions for their clients in the UAE for the beneficiaries in India. The Court had observed that the services provided through the liaison offices were auxiliary in nature and that the RBI approvals are not conclusive but persuasive. The verdict was in favour of the UAE Exchange Centre considering the fact that the liaison offices were just facilitating the services of the assessee in India and hence could not be considered as PEs. On the same lines, the speaker took up several other judgments where he applied the principles of international taxation.

Taking up the case of DIT vs. Samsung Heavy Industries Co. Ltd. [2020] 117 taxmann.com 870 (SC), Dr. Lala referred to some provisions of the India-Korea DTAA. The assessee, a tax resident of Korea, was awarded a contract for carrying out survey, design, engineering, procurement, fabrication, installation, modification, start-up and commissioning of facilities covered under the ‘Vasai East Development Project’ (the ‘Project’), by Oil and Natural Gas Corporation [ONGC] for which it had opened a Project Office in Mumbai to act as a communication channel between it and ONGC. The assessee reported a loss of Rs. 23.50 lakhs in the return filed for A.Y. 2007-08.

The A.O., during the course of assessment proceedings, passed a draft assessment order holding that the project was a single indivisible ‘turnkey’ project and therefore the profits arising from the commissioning of the same would arise in India. He further held that the work relating to fabrication and procurement of material was very much part of the turnkey contract and the said work was wholly executed by the PE in India. Not merely this, the A.O., with the help of ‘Capital Line’ software, determined that 25% of the revenue be taxed in India under the Transfer Pricing Guidelines. The Tribunal also held that the assessee is liable to be taxed in India considering several administrative expenses claimed by it.

The Uttarakhand High Court allowed the appeal of the assessee and set aside the Tribunal’s judgment so far as it related to imposition of tax liability on 25% of the gross receipts of the assessee. The Revenue appealed against the order and the matter moved to the Supreme Court. The Supreme Court observed that the finding of the Tribunal, the mere mode of maintaining the accounts alone, could not determine the character of a permanent establishment. The finding of the Tribunal was held to be a perverse finding. Further, the view of the Tribunal that the onus is on the assessee and not on the Revenue to demonstrate that the project office was not a permanent establishment of the assessee was held to be contrary to the decision of the Supreme Court in E-Funds IT Solutions Inc.

Another issue on PE was that of the Dependent Agency Permanent Establishment (DAPE) in the case of CIT vs. Taj TV Limited [2020] 115 taxmann.com 305 (Bombay). The Bombay High Court held that since none of the conditions as mentioned in Article 5(4) of the India-Mauritius DTAA was fulfilled, the DAPE of the assessee was not established in India, i.e., qua the distribution agreement.

On the issue of royalty under international taxation, the speaker gave his insights on the judgment in Majestic Auto Ltd. (Assessee – Ten Sports) vs. CIT [2019] 110 taxmann.com 261 (Punjab & Haryana). In this case, the Court had held that payments for supply of designs, drawings, specifications, etc., were not in the nature of royalty and favoured the assessee. The speaker also explained the provisions of the India-Austria DTAA.

Dr. Lala spoke in detail on the subject of fees for technical services in the judgment given by the Mumbai Tribunal by citing the case of Buro Happold Limited vs. DCIT [2019] 103 taxmann.com 344 (Mum-Trib). The Tribunal held that the supply of project-specific designs / drawings / plans did not make available technical knowledge, experience, skill, know-how or process (since the designs were project-specific and could not be used by Buro India subsequently) and hence the same was not taxable in India.

Another case in which the judgment went in favour of the assessee was when the Mumbai Tribunal in Morgan Stanley Asia (Singapore) Pte. vs. DDIT (IT) [2018] 95 taxmann.com 165 (Mumbai-Trib) allowed the main grounds of the appeal in favour of the assessee and did not adjudicate the balance grounds which became academic in its opinion (once the reimbursement of salaries was not taxable, the corresponding TP adjustment / mark-up could not be taxed). Provisions of the India-Singapore DTAA were also taken up at length.

On capital gains on the transfer of shares, the speaker, Dr. Lala, selected the case of Sofina S.A. vs. ACIT [TS-129 ITAT-2020 (Mum)] ITA No. 7241/Mum/2018. He explained the provisions of section 9 of the IT Act, 1961 along with Article 13 of the India-Belgium DTAA while explaining the verdict. The Tribunal in its decision had said that if a person holds shares outside India which, directly or indirectly, derive their value substantially from assets located in India, the legislation deems such shares located outside India to be located in India for taxation purposes. However, a similar approach is not envisaged in Article 13(5) of the relevant DTAA and hence it cannot be deemed that the mentioned transaction results in the transfer of shares of the Indian company.

As for the taxability of interest income in India, the speaker took up the case of Golden Bella Holdings Ltd. vs. DCIT [2019] 109 taxmann.com 83 (Mumbai-Trib) and made a brief reference to Article 11(2) of the India-Cyprus DTAA to explain the decision of the Tribunal. The Tribunal had held that the assessee would be eligible for the DTAA benefits and shall not be subject to tax in India.

On professional fees received by an Indian firm from its foreign clients, Dr. Lala explained the case of Amarchand & Mangaldas & Suresh A. Shroff & Co. vs. ACIT [2020] 122 taxmann.com 248 (Mumbai-Trib). He elucidated certain Articles of the India-Japan DTAA and stated that the contention of the A.O. while passing the assessment order does not fall in line with the DTAA. The Revenue had denied the TDS credit which the Japanese firm had taken while making payments to the Indian law firm. The Tribunal went with the assessee, thereby allowing the TDS credit to avoid double taxation.

Next, the speaker took up the newest issue in the area of international taxation, that of shrink-wrap computer software in the case of Engineering Analysis Centre of Excellence (P) Ltd. vs. CIT [2021] 125 taxmann.com 42 (SC). The issue was, does the payment made for the purchase of shrink-wrap computer software amount to royalty or not? The speaker explained section 9 of the Act read with Article 12(3) of the India-Singapore DTAA and also explained the implications of applying the provisions of the DTAA at the time of withholding taxes u/s 195. Further, he referred to section 14 of the Copyright Act which the Supreme Court considered while deciding on the case. The Supreme Court had to decide on more than 100 such pending appeals. The speaker, Dr. Lala, dealt with the topic in a quick but detailed manner, making references to the OECD commentary as well.

The meeting ended with a vote of thanks proposed by Siddharth Banawat, Convener of the International Taxation Committee of the BCAS. The above lecture is available on BCAS@bcasglobal on our social media platforms and at https://www.youtube.com/watch?v=3I9XFhBGWos.

IMPACT OF SC DECISION ON SOFTWARE TAXATION

The BCAS organised a lecture by H. Padamchand Khincha titled ‘Analysis and Impact of Supreme Court decision on Software Taxation in Engineering Analysis Centre of Excellence Pvt. Ltd.’ The virtual meeting was held on 24th March.

Interestingly, the above case and the decision thereon had been awaited for long as it dealt with one of the most contested issues in international tax.

Mr. Khincha spoke on the importance of the decision and its impact. While clarifying its scope, he pointed out that not all types of transactions related to software have been dealt with by the decision. He also noted how the decision lays down principles on copyright issues related to software by considering other decisions on copyright law. These principles can possibly be referred back on decisions on copyright law.

The speaker expounded on various relevant provisions of the copyright law which form the bedrock for a proper analysis of the decision. He then dealt with the Court’s decision on end-user license agreement in respect of a physical copy of a software sold to an end-user. The decision holds such an agreement to be in the nature of a contractual agreement and not a license of copyright. In that sense, use of a software would be akin to the purchase of a book. The Supreme Court has held, in essence, that sale of software to an end-user would be akin to the sale of a copyrighted article and hence not license of a copyright.

Mr. Khincha then analysed the Court’s decision on the phrase ‘granting of license’ in the definition of royalty u/s 9(1)(vi). It held that the phrase needs to be juxtaposed with the preceding words which necessitates transfer of rights or parting of rights from the copyright holder to the user. Without this, the payments would only become a business income and not a royalty payment. The Court held that even though the language used under the Act is distinct from that used under the treaty, the above reasoning would still hold good even under the treaty. He explained that the Supreme Court had held that mere letting or mere licensing would not be critical unless they related to specific rights under the copyright law, hence not leading to taxation as royalty in the case of software sold to end-users.

The speaker next focussed on the Supreme Court’s decision on transactions between the owner of software and its distributor. Does the distributor have a copyright right of ‘right to reproduce’ or ‘right to issue copies to the public’? While the distributor has a right to reproduce, it does not have an uninhibited right to reproduce but merely a right to reproduce for sale a limited number of copies of the software. Turning to the concepts of ‘principle of exhaustion’ and ‘principle of first sale’ which have been referred to in the Supreme Court decision, he pointed out that the Court had held that such limited right provided to the distributor to reproduce is for mere facilitation to sell those limited number of copies of the software and not an ownership right.

As for the Court’s consideration of the copyright rights of ‘rights to sell’ or ‘offer for sale’ or ‘offer for commercial rental’ of a computer programme, Mr. Khincha also enlightened the gathering about how the relevant notes to clauses for deletion of certain phrase in them were not brought to the notice of the Supreme Court and explained how the Court had relied on underlying decisions to arrive at its decision. The Court had held that ‘exclusivity’ is the distinguishing factor whereby
‘right to use’ can be considered as a transfer of copyright right in favour of a distributor only where the distributor has ousted the owner from these rights and hence has stepped into the shoes of the owner of the copyright. Where this is not the case, there would be no license of a copyright right and hence it would not be royalty. In fact, Paragraph 117 of the decision lays down six important principles of interplay of the copyright law and the Income-tax Act.

Following this masterful dissection of the Supreme Court decision, Mr. Khincha went on to analyse its other implications, starting with Explanation 4 to section 9(1)(vi) and its applicability to transactions done before the said Explanation was brought into law. The Supreme Court held that the Explanation could only be applied prospectively and not retrospectively. Such a decision is important to understand the implications of other explanations similarly having been introduced with retrospective effect. The speaker also analysed the implications of the decision on section 194J and other provisions of the IT act dealing with software taxation as well as equalisation levy. He dealt with the implications of this decision on other Supreme Court decisions and offered his views on the proposed amendments to the UN Model on the Article on Royalty. He ended his exposition with a peep into the Government’s thinking which portended that multiple levies and rates may become applicable to taxation of software royalty as the Government would not like to lose such revenue.

Rutvik Sanghvi proposed the vote of thanks. The archival video of the meeting has, in a short time, garnered a few thousand views.

‘IS THERE A CHANGE IN EXPECTATIONS FROM AUDITORS?’

Whilst the basic principles of conducting an audit have stood the test of time, like many other areas it has to evolve and move with the times whether in terms of increasing technical and reporting responsibilities laid down by the ICAI and other Regulators, including NFRA, technical challenges due to digitisation, increased frauds and irregularities and, last but not least, the new but continuing monster on the block by the name of Covid-19. Further, the expectations of the various stakeholders like managements and the Regulators as well as the society in general have also increased manifold, thereby creating an expectation gap.

With these thoughts in mind, the BCAS organised an interesting virtual panel discussion on 7th April styled ‘Is there a change in expectations from auditors?’ The elite panel consisted of M.P. Shah, Regional Director, Western Region ROC, Nilesh Vikamsey, Past President, ICAI, and Mr. Anil Singhvi, investor activist and former MD of Ambuja Cements Ltd., representing the interests of the Regulator, the practitioners and industry, respectively. The discussion was moderated by Sudhir Soni.

Welcoming the panellists and participants, President Suhas Paranjpe indicated that auditors and audit expectations is a hot topic which keeps on changing and hence he hoped that this discussion would provide a 360-degree view from the perspective of different stakeholders. Vice-President Abhay Mehta briefly introduced the moderator and the participants.

Starting the discussion, Sudhir Soni welcomed the panellists and indicated that whilst financial reporting and auditing give a lot of comfort to the various stakeholders, there have been several corporate failures coupled with frauds and compliance gaps in the recent past, resulting in the audit quality being called into question and also the consequential changes in expectations arising therefrom. He then initiated and very ably moderated the discussion by asking several questions on a wide range of issues impacting the various stakeholders which elicited several responses, concerns and suggestions from the panellists, the principal ones being as under:

  •  There have been very few references received from auditors u/s 143(12) of the Companies Act, 2013 despite the fact of too many corporate scams taking place. Further, even in cases where such references are received, there is a perception that no stringent action is initiated but a random scrutiny is undertaken based on complaints by aggrieved stakeholders.
  •  The recent amendments to CARO and its linkage with schedule III will put greater onus on managements on various aspects like usage of funds, filing of returns with banks, etc., which will also facilitate the auditors to discharge their reporting obligations in the right spirit.
  •  Whilst expectations from auditors to detect frauds on a timely basis have risen, anything which is in the nature of ‘premeditated murder’ is very difficult to detect.
  •  Audit no longer retains its glamour and is not considered as remunerative vis-a-vis consultancy. Audit is not an investigative or forensic exercise, though it is expected to raise red flags. However, the time is not far when the face and expectation of audit would change to that of being forensic and investigative due to the increased role of digital tools (including blockchain technology) which would largely do away with sampling. Further, reporting on internal control weaknesses needs to be more focused and widespread.
  •  The cushy relationship between auditors and promoters can be mitigated by getting their appointment approved by the majority of the minority.
  •  Even though in the past auditors had heavily qualified certain financial statements, banks continued to extend loans and no other regulatory action was immediately forthcoming.
  •  On the question of whether any independent analysis of audit qualifications is undertaken, it was indicated that as a part of the initiative to leverage technology, a Central Scrutiny Centre would look at various forms and financial statements which are filed to provide an early warning signal.
  •  Auditors should play a greater role in highlighting various corporate governance issues more in spirit rather than as a tick-in-the-box approach. This would also involve a holistic approach towards issues like appointment, remuneration, resignation and prosecution on the part of various stakeholders.
  •  The auditors would need to be more vigilant as managements and CFOs are getting smarter and are always a step ahead! There should be more emphasis on software and hardware-related digital skills and greater use of professional scepticism.
  •  The time has come for auditors to comply with the SAs in spirit and whilst documentation is important (especially for the Regulators), there should be greater emphasis on judgment and matters involving public interest.
  •  Whilst it is always the statutory auditors who are blamed for failures, the time has come for making credit rating agencies, internal audit, audit committees and Independent Directors more accountable.

The meeting concluded with a vote of thanks proposed by Zubin Billimoria.

WEBINAR ON TDS AND TCS PROVISIONS

The BCAS joined hands with the IMC Chamber of Commerce and Industry, the Bombay Chamber of Commerce and Industry, and the Chamber of Tax Consultants to organise a two-day online webinar on ‘TDS and TCS provisions – A 360-degree perspective’ on 7th and 8th April. The webinar was planned as a mix of panel discussion and presentation sessions on relevant TDS and TCS issues with knowledge-sharing by eminent tax experts from the corporate and professional fields, as well as from the Revenue Department. As panellists, they provided a holistic perspective and offered a blend of academic and practical solutions to the questions posed.

The first discussion moderated by Past President Anil Sathe had Mr. Saunak Gupta of Blue Star India and tax expert Daksha Baxi on the panel. It covered practical issues being faced by traders and e-commerce operators in relation to TDS on purchase of goods (section 194Q) to be introduced from July, 2021, TCS on sale of goods [section 206C(1H)], TDS on certain e-commerce transactions (section 194-O) and other provisions with various case studies. The panel dealt with issues like what would be considered as ‘goods’, sales returns, turnover thresholds prescribed for applicability of section 194Q, distinction between professional and technical services for section 194J, etc.

The panel for the second session, moderated by Atul Suraiya, formerly of Tata Chemicals, comprised Mr. Rakesh Gupta from the RPG Group and tax experts Ms Hema Lohiya and Mr. Mahendra Sanghvi. They discussed intricate legal issues arising from TDS mismatch in salary shown in Form 26AS versus actual salary, non-receipt of Form 16, claiming refund of TDS, prosecution for defaults and other important topics.

On the second day, Mr. Avinash Rawani covered the entire gamut of TDS and TCS procedural compliances, including issues in return-filing, rectifications, claiming refund, etc. Mr. Rawani also answered a host of queries from the participants pertaining to a number of issues that professionals face on a day-to-day basis and complying with the same.

The fourth session had the benefit of the experience of Mr. Sanjeev Sharma, Principal Director of Income-tax (Investigation), Bihar and Jharkhand, and tax experts Mr. Sanjiv Chaudhary and Dr. Mayur Nayak on issues related to tax deduction from payments to non-residents. It was ably moderated by Sushil Lakhani, a member of the International Taxation Committee. The panel discussed the recent Supreme Court decision on taxation of software along with TDS on various payments such as cloud computing fees, commission and marketing fees, reimbursement of expenses, the need of TRC, etc.

The last panel comprised of Mr. Hemant Kadel of Grasim Industries and BCAS Direct Tax Committee Member Sonalee Godbole. The moderator, Mr. Ravi Mahajan, led the panel through a host of topics such as TDS on employee contributions to provident funds in excess of the prescribed limits, differentiation between TDS u/s 192 as salary or as professional fees u/s 194J, changes in salary payments towards the end of the year, etc.

All the panels received several queries from the participants which were ably dealt with. On the whole, the clarifications provided by the panellists were quite detailed and proved helpful to the participants in clarifying some very practical questions and issues. A clear need was felt for reducing the tax deductor and collector’s burden by reforming the cumbersome and plentiful set of tax collection provisions.

The paid Webinar was attended by close to 500 participants and proved to be a successful example of conducting joint programmes with sister organisations on important topics.

IMPORTANT DECISIONS IN INDIRECT TAXES


A lecture meeting on ‘Recent Important Decisions in Indirect Taxes’ was held online on 9th April. It was open to all and was addressed by Advocate Mr. J.K. Mittal from New Delhi. He is a Co-Chairman of the National Council on Indirect Taxes, ASSOCHAM, and has been honoured several times by the Supreme Court Bar Association.

Mr. Mittal in his address dealt with several important decisions in the areas of service tax, GST, sales tax as well as customs, including the decision of the Supreme Court in the case of State of West Bengal and Ors. vs Calcutta Club in which the levy of service tax and VAT was held inapplicable on mutual association / members’ club even after the 46th Amendment adding Article 366(29A) to the Constitution of India. He also pointed out that an attempt has been made by the Government to make a retrospective amendment in the GST law to nullify the decision of the Supreme Court and also expressed concern over such frequent retrospective amendments which are not assessee-friendly.

He discussed another decision of the Supreme Court in the case of Canon India (P) Ltd. vs. Commissioner of Customs which dealt with the power of the DRI to issue show cause notice vis a vis the jurisdiction of ‘proper officer’. The decision of Torrent Power Ltd. dealing with the concept of ‘composite supply’ was also discussed. He also respectfully disagreed with the decision of the Calcutta High Court in Srijan Realty (P) Ltd. vs. Commissioner of Service Tax, the decision of the Orissa High Court in Safari Retreats (P) Ltd. vs. CC-CGST and the decision of the Delhi High Court in the case of Aargus Global Logistics Private Ltd. vs. Union of India & Anr. and shared his views thereon. A few other judgments such as South Eastern Coalfields Ltd. vs. CCE&ST (Delhi CESTAT), Sahitya Mudranalaya Private Ltd. vs. Additional Director-General (Gujarat High Court) and JSK Marketing Ltd. vs. UOI (Bombay High Court) were also discussed.

In his 90-minute-long address Mr. Mittal touched upon various legal propositions arising out of several decisions and also enlightened the audience with his views on certain contentious matters, including the power of officers to issue summons and to conduct audit under GST. He also answered queries posed by the participants, during as well as at the end of the session.

The meeting was attended by more than 160 persons on the Zoom platform and is also being watched continuously on the YouTube channel of the BCAS at https://www.youtube.com/watch?v=a7G4h4LNdBY with more than 900 views so far.

‘RECENT IMPORTANT DECISIONS IN IT’

The BCAS organised a lecture meeting on ‘Recent Important Decisions in Income Tax’ on 14th April which was addressed by advocate Hiro Rai. It was held in virtual mode on the Zoom platform with live streaming on YouTube.

President Suhas Paranjpe made the introductory remarks and welcomed the speaker, whereas Joint Secretary Mihir Sheth introduced him.

Hiro started the session by listing a few principles which one should keep in mind while studying judgments of various courts. He explained the intricacies of the judgment given by the Supreme Court in Shree Choudhary Transport Company vs. ITO [2020] 426 ITR 289 [SC] which dealt with various issues relating to disallowance u/s 40(a)(ia). He then took up the important Supreme Court judgment in DCIT vs. Pepsi Foods Ltd. 126 taxmann.com 69 dealing with vacation of a stay under the third proviso to section 254(2A). The Court struck down the proviso as it was offending Article 14 of the Constitution of India and would be arbitrary and discriminatory if the delay was not attributable to the assessee. He then explained how the arguments accepted in this judgment would be important in challenging the constitutional validity of faceless Tribunals whenever they are challenged. He took up various other important Supreme Court judgments reported in the last one year and explained various crucial points and arguments and offered his insights on the said case laws.

Hiro then took up the Bombay High Court decision in Sesa Goa Limited vs. JCIT 423 ITR 426 which dealt with deductibility of education cess. It held that the education cess is allowable u/s 40(a)(ii). He also explained how this case law can help assessees on similar grounds or as an additional ground in their appeals. Further, he emphasised the importance of drafting appeals and submissions before various authorities and explained various legal points arising from these case laws.

He also discussed some of the recent important decisions of the Tribunals and then answered a few queries from the participants on the case laws discussed by him. The session was insightful and helpful for all (400-plus) participants who attended the meeting virtually.

The vote of thanks was proposed by Hardik Mehta, Convener of the Taxation Committee of the BCAS.

The lecture is available on BCAS@bcasglobal on our social media platforms and at https://www.youtube.com/watch?v=UjadD6oNo1Q&t=4676s.

FELICITATION OF NEW CA’s

It was Arthur C. Clarke who wrote, ‘The moon is the first milestone on the way to the stars’. In the case of the successful finalists of the CA exams of November, 2020 and January, 2021, just the cracking of the exams (touted to be among the toughest in the world), is truly the first major milestone in their lives.

The perseverance and grit displayed by these Achievers is particularly noteworthy, given the fact that the year that went by was an extremely challenging one for everyone, more so for those who took the Final CA exam.

Every year, the Seminar, Public Relations & Membership Development Committee (SPR&MD) of the BCAS felicitates the ‘achievers’ of the November and May examinations at the BCAS office. But this year, given the Covid-19 restrictions, the event was held on the virtual platform on 23rd April – this happened for the first time since it was launched. A special discussion on ‘Milestone 2.0 – Building a “CA”reer’ with a distinguished panel comprising Bhavna Doshi, Robin Banerjee and Anand Bathiya was organised to guide and mentor these youngsters.

The mentors can be best described by a line from a poem by Robert Frost:
Two roads diverged in a wood, and I,
I chose the one less travelled by,
And that has made all the difference.

One part of the registration form was designed in such a way that the questions and concerns of the pass-outs were highlighted. That the mentors took their roles very seriously was evidenced by the fact that they sought a mock session a week before the event. The questions and concerns were also shared with the mentors to give them an opportunity to better understand the participants’ minds.

Interestingly, within 24 hours of the announcement of the event it attracted close to 300 registrations – some from states as far away as Jharkhand, Bihar, Orissa, West Bengal and Chhattisgarh. By D-Day, the registrations crossed 500 – including over 70 rankers.

In his opening remarks, President Suhas Paranjpe welcomed the young pass-outs into the fraternity and reminded them that while they strive and focus to achieve success in their professional careers, it is also equally important to devote time and energy to look after their health and well-being.

Vice-President Abhay Mehta also addressed the gathering.

SPR&MD Chairman Narayan Pasari called upon the youth to rise up to their role in building a strong nation. He briefed them about the activities of the Committee, including the programmes where ‘Yuva Shakti’ takes the lead.

He pointed out that one of the important activities of the Committee is the publication of the BCAS Referencer which is now in its 59th year of publication. The Referencer acts as a Bible for every professional, whether in practice or industry.

Managing Committee member and SPR&MD Convener Kinjal Bhuta, who is also the youngest Editor of the Referencer, briefed the audience about the theme behind this year’s publication, ‘Namaste Bharat’, which celebrates the rich tradition and culture of the country. For the past several years, Past President Pranay Marfatia has been guiding the team that puts the Referencer together and this year was no exception. The principal team of writers, Zubin Billimoria and Yatin Desai, was also present.

The flip-book version of the Referencer was officially launched on the occasion by the President, the Vice-President and the three mentors. The exquisitely-crafted Referencer drew praise from the mentors as the pages unfolded on the screen.

The moderator for the event was Committee member Kushal Lodha, himself an all-India rank-holder in the November, 2019 examinations. The first question was the one that vexes every batch of pass-outs – industry or practice? Then there were questions such as ‘What if I realise after a year or so that I do not enjoy the work I am doing? What do I do then?’

Bhavna Doshi advised the pass-outs to not worry too much when it came to choosing between practice, industry and something else; it was never too late to do course-correction and no experience ever went waste. To those intending to start a new practice, she suggested that they think of it as a start-up and plan accordingly.

Another question was whether one should pursue MBA immediately after CA or gain some work experience for a year or two. Robin Banerjee suggested that it is far more important to ensure that the MBA is done from one of the top 20 or 25 institutions; and if becoming a CFO is the ultimate goal, one should look at being a generalist rather than a specialist. He also spoke of the importance of ‘CLEAR’ – C for Communication, L for Learning, E for Ethics, A Attitude and R Relaxation, and emphasised the importance of Intelligence Quotient, Emotional Quotient and Love Quotient.

On the question about industry vs. practice, or generalisation vs. specialisation, Anand Bathiya stated that it is good to have problems and questions at times and such discussions are possible ‘because we Chartered Accountants are so versatile’. He suggested that instead of a top-down approach, one should look at a bottom-up approach, starting with listing one’s preferences, family background, etc., to arrive at the right decision.

So far as the current lockdown was concerned, Bhavna Doshi stated that while the world has changed completely, there is a silver lining, too. Today, CAs are providing more than the traditional services and are able to reach out to a much larger potential client base irrespective of the geographical location. She further emphasised that as suggested by Robin Banerjee, ‘turn-around strategist’ is one of the emerging areas for CAs. The opportunity to help stressed clients must be explored. Anand Bathiya invited the achievers to look up the free courses available on Google Digital Garage on topics as varied as Artificial Intelligence, Blockchain, Cryptocurrency, Digital Marketing, to name a few – these courses take anywhere from three weeks to three months.

While a regular, physical event enables BCAS to felicitate the achievers in front of their peers, this being a virtual event, four achievers were given the opportunity to personally interact with the mentors. The happy faces which appeared on the screen spoke volumes of the effect that the mentors’ talk had had on them.

A rapid-fire round for the mentors at the end of the session gave the audience an opportunity to learn a little more about them, their likes and interests. Virag Shah proposed the vote of thanks. The efforts of Convener Preeti Cherian and Rimple Dedhia in setting up the event were acknowledged.

That the event was well received was evidenced in the feedback that was received after the event and the 2,000 + (and counting) views on YouTube since then.

VIRTUAL FIRE-SIDE CHAT

The BCAS joined hands with the Association for Chartered Accountants, Chennai, to organise a virtual fire-side chat on the ‘New Income Tax Provisions on Charitable Trusts’ on 24th April. It was held by means of the Zoom webinar facility.

The key speaker was Gautam Shah and the discussion was moderated by Divya Jokhakar. The webinar was also broadcast on YouTube and a total of 480 participants attended it.

Speaker Gautam Shah started by giving a brief introduction of the provisions of sections 12AB, 10(23C) and 80G of the Income-tax Act, 1961. He then went on to tackle the questions posed to him by the participants. Most of these were based on the practical and academic difficulties encountered by them while dealing with renewal, registration and re-approval of Income-tax exemption certificates from the Department under the above provisions.

After the chat, Gautam spent some time addressing even more queries from the participants. The two-hour session was helpful in resolving several real-time problems.

SOCIETY NEWS

THE ‘SCIENCE OF MANIFESTATION’

The HRD Study Circle organised an online meeting on 13th October, 2020 on the ‘Science of Manifestation’ presented by Mr. Sanjay Mansukhani.

Interestingly, the speaker started the session in a matter of fact manner by saying that ‘all that we need to do is go in’. What he meant thereby was that when we go ‘inside ourselves’, we meet both our Mind and our Soul. By training our Mind and our Soul we can develop and access their power to the fullest. And if this is done smartly, then it can create magic in our lives and in the lives of others around us, namely, our family, community, nation and humanity at large.

The session was based on two world-class treatises that expound the powers of the Mind and the Soul.

1. ‘Master Key System’ by Charles F. Haanel, 1912
Mr. Mansukhani stated that this American tome is the ‘Father’ of all transformational and creative manifestation teachings. It produces unbelievable results through the right understanding and application of Thought, of the Conscious mind, the Sub-conscious mind, the Universal Mind, Universal Laws and Mental exercises. It is meant for advanced learners of the science of manifestation. It is for those who have already read ‘The Secret Book’ and know the ‘Law of Attraction’.

2. ‘Yoga Sutras’ by Rishi Patanjali, 400 BC
This is the ancient Indian science of Dhyana yoga. The four padas of Samadhi, Sadhana, Siddhis and Kaivalya reveal the deep science of manifestation. By practising it all worldly manifestations to God realisation can be achieved. It is strictly for serious advanced learners of the science of manifestation. It helps if the ‘Master Key System’ has already been learnt and practised.

A discussion on the above leads one to obtain a complete picture of the science of manifestation. ‘Master Key System’ is the western science of manifestation where the current laws of science are applicable, whereas Patanjali yoga sutras are the ancient Indian science of manifestation where the results go beyond the realms of modern-day science such as Siddhi (mystic powers) and Kaivalya (liberation).

The outcome of BIG manifestations will come with the right training and disciplined practice. The session ended with some intriguing thoughts. India and our friends and family are waiting for us to deliver BIG THINGS. The question is, CAN WE?

PANEL DISCUSSION ON ‘BUDGET 2021’

An illustrious panel of experts participated in a lively virtual discussion on ‘Budget 2021 – A 360° view of the Indian Economy’, on 24th February, 2021. They were Bhagirath Merchant, Ex-President, BSE; Niranjan Hiranandani, Co-Founder and Managing Director of the Hiranandani Group, and Dr. Ajit Ranade, Chief Economist of the Aditya Birla Group. Vikas Khemani moderated the discussion.

Welcoming the guests and participants, President Suhas Paranjpe explained that it was important to have a 360° view of the Budget as it was likely to have significant implications in the years to come. Vice-President Abhay Mehta introduced the panellists and the moderator.

Launching the discussion, Vikas Khemani said that the current year’s Budget did manage to meet the expectation of a ‘Once in 100 years Budget’ as was promised by the Finance Minister. It was indeed a shift of mind-set from extreme prudence to growth orientation, from incremental approach to leap-frogging, all this while keeping in mind the new economic realities. The Budget had demonstrated that policy-makers were working in a coordinated way to reach the goal of a ‘Five Trillion Dollar’ economy that the Prime Minister had envisioned.

Agreeing with these views, Niranjan Hiranandani said that there was indeed a paradigm shift evidenced in ‘Budget 2021’. Not deterred by the challenges posed by the pandemic, it had tried to convert them into an opportunity to bring about major reforms. The proposal to increase the capital expenditure for infrastructure by Rs 5 lakh crores without burdening the taxpayers with additional taxes was visionary. Although it could lead to deficit financing, it clearly reflected the positive mind-set of the policy-makers to give an impetus to infrastructure without impacting the consumption power of the people. Besides, openly supporting privatisation of the public sector was indeed a trendsetter. The concept of an infrastructure bank was a welcome move and he wished that there could be a couple of them rather than just one so as to increase the capability of taking on more projects with distributed risk. With expectations having been roused in the business community, he said that it would not be too much to ask for a clear asset monetisation policy and rationalisation of the highest tax rates which were currently at 42%. Concluding his remarks, he said that it was a great Budget that would put India on the trajectory of a growth rate of 11 to 12% in real terms.

Expressing his views, Dr. Ajit Ranade said that Budget 2021 laid the roadmap for several generations by providing funds for infrastructure. He was glad to note such evolved thinking on the part of the Government, that deficit financing is not a taboo if money is planned to be spent on building the future for generations to come. Lauding the Budget, he said that among the positives were that it was bold, with no further taxes, it showed a clear intent of privatisation of the public sector and proposed a push on many initiatives that would make GDP growth possible at 15% in nominal terms and at 11 to 12% in real terms. In Dr. Ranade’s opinion, the only caveat was to meet deficit financing without moving interest rates, with a proactive role for the RBI and providing a level playing field for the private sector to succeed.

For his part, Bhagirath Merchant complimented the Finance Minister for thinking out of the box and laying down the policy intent clearly. He appreciated the increased allocation for infrastructure, health and education and said that this was the first Budget that clearly quantified the disinvestment target. Making railways ‘future ready’ would help the manufacturing and agriculture sectors. Agricultural income would double thanks to this Budget. Growth in manufacturing will create opportunities by giving rise to ancillary industries, the SME sector and also the services sector. The move for privatisation of the public sector would unlock funds for Government to direct them in the right channels and would prove very useful in the long run.

Giving an example of how infrastructure investment could be self-fulfilling, Bhagirath Merchant said that with the build-up of the road network, the daily toll collection itself was more than Rs. 100 crores, thus helping in the direct recoupment of capital spent (to the tune of Rs. 36,500 crores per annum). Add to that the other benefits of faster traffic movement, increased trade volumes and tax collections, the benefits could be humongous. He gave a ‘thumbs up’ to the Budget on all these counts.

Pointing out that Government departments will now be permitted to bank with private banks, moderator Vikas Khemani said that the role of the private sector and external capital will assume greater importance. He invited the panellists to give their points of view. All panellists agreed with him and stressed the inevitability of investments from the private sector and access to funds from external sources. The general consensus was that ease of business will have to be accelerated even further as there were still quite a few issues on last-mile connectivity at the ground level. However, there was no denying that Government was quite proactive in responding to the challenges.

The next question raised by the moderator was whether the current account would continue to be in deficit or would be in surplus with rising exports that may occur with the push on manufacturing and the Atmanirbhar Bharat initiative. Most panellists felt that the current account numbers would continue to remain in deficit with rising import of crude and increasing consumption of aspirational India. However, that deficit would have ample leeway to be compensated by a rise in capital funding from external sources, making the overall balance of payment position positive.

On a question about the opportunities for wealth creation and green shoots for various types of industries, Bhagirath Merchant felt that there were ample opportunities. His opinion was backed by other panellists, too. The point in support of this argument was that the current pandemic had opened the vistas for cost reduction. And this was evidenced in the second quarter results of several companies. The Balance Sheets of Government banks and NBFCs had been nearly cleaned up to a ‘hygienic level’, free from their past issues, resulting in an improvement in their asset quality. The BFSI sector was on the verge of a major breakthrough with serious commitment of Government on business. The market would see huge capital mobilisation that companies already had on the anvil.

Niranjan Hiranandani echoed the above sentiments and said that the realty sector was also on the verge of a big turnaround with ease of finance, push to building houses under the PMAY and a proper regulatory framework of RERA in place. He said that NPAs in the realty sector could be transferred to the ‘Bad Bank’ which was under consideration of the Government. The private sector was prepared for something similar to SWAMIH fund that could infuse new life into many stalled projects. All these could provide a big boost to the realty industry. He cautioned, however, that instead of looking at the industry in general it would be prudent for the investors to look at each company separately for its credentials. On the whole, he was very positive about the market opportunities in the realty sector.

Dr. Ajit Ranade also opined that with growth in manufacturing and availability of funds, sectors such as warehousing, data warehousing, logistics, etc., looked positive.

The panel discussion was followed by a Q&A session. On a question whether there were any missed opportunities in the Budget, the opinion was that the wish list is always long but the Budget needs to be looked at as a balancing act for one year, and to that extent it did do justice to the exercise. To another question on the probable risks of losing the momentum, the answer was that there were always some risks in a democratic society that arise out of political fallouts, the excessive caution-driven approach by bureaucrats and last-minute hitches due to external factors. However, despite all these, the
Budget was indeed path-breaking in its approach and thinking.

Treasurer Chirag Doshi proposed the vote of thanks.

The panel discussion is available on YouTube and the BCAS website for viewing.

SOCIETY NEWS

ON BUILDING A PROFESSIONAL  SERVICES FIRM
A virtual and thoroughly illuminating panel discussion on a vital subject, ‘Building a Professional Services Firm: Characteristics, Challenges & Leadership Model’, was organised by the BCAS on 10th February, 2021. The panel consisted of such illustrious speakers as Dinesh Kanabar, Mr. Haigreve Khaitan, Senior Partner, Khaitan & Co., and Mr. Jay Desai, Founder, Universal Consulting. Past President Shariq Contractor acted as the moderator.

Welcoming the participants, President Suhas Paranjpe gave the backdrop of the day’s topic for discussion. He said that the process of building a professional services firm resonated very well with the BCAS Theme for the year ‘Tradition – Transition – Transformation’ as every growth from small to medium to big would need to undergo this process.

After Hon. Secretary Mihir Sheth introduced the guest speakers, Shariq Contractor set the tone of the discussion by emphasising the need for growth by the professional services firms and a change in their mind-set if they wished to survive the challenges posed by continuing innovations and technology transformations. The need for change could not be overemphasised when 90% of the professional firms were operating with less than four partners, depriving them of the scale and depth required to maintain excellence through best possible talent retention. Sharing his own experience, he said that it was a ‘leap of faith’ fully realising that change could be painful. However, not changing would have been more painful in hindsight. Every professional firm would need to decide and discuss amongst its stakeholders its strategy, systems and processes, succession and leadership decisions and define the relevant metrics for growth. After this brief introduction, he invited each panellist to share his story of growth.

Dinesh Kanabar, who was the first to speak, said he would rather share the experience of what he did and why he did what he did instead of delving into the theories of growth. When he started his firm after retiring from the Big-4, he focused on the basics by defining the fundamental tenets of where the focus should be out of the large canvas of services that it was possible to offer. However, what made a difference was the realisation that growth could only be possible by offering expertise through quality talent in the chosen domain of strength. Besides, the services on offer had to be relevant to the marketplace. This, in turn, would build the size and scale necessary to create a brand that would self-sustain growth by attracting further best-in-class talent, making it possible to have patronage from large domestic and international firms.

Creating the right size with a deep knowledge base was the key to success. There was also an underlying conviction that the size and scale should not be achieved by chasing revenue enhancement and spreading thin into a number of domains. Another factor that was responsible for this decision was the belief that the services that his firm would offer must leave no chance of conflict of interest between the verticals. This belief reinforced his vision to focus on a few areas of acquired expertise that could count amongst the best. A broad vision to this effect was the germination point that eventually evolved by hiring the right talent, building the appropriate infrastructure and technology, and sourcing of the right mix of domestic and international clients. If one was ready to break the mould, there was huge scope and also plenty of opportunities for professional services firms. Dinesh Kanabar concluded by saying that growth was not an option but a compulsion in the current times.

Narrating his growth story, Mr. Haigreve Khaitan described how his more-than-100-year-old firm had to reinvent itself by breaking the shackles of its image of being only a regional player. One of the fundamental principles with which the firm decided to take up the challenge was that under no circumstances would it compromise on its culture and value system but yet cast itself in a new avatar, fully equipped with the right talent, knowledge base and infrastructure. It was this thought process that eventually led it to define the pillars that could help achieve the goal of building a firm with a stellar repute and consistent growth. The pillars that were defined were: (i) Knowledge, (ii) Technology, (iii) Infrastructure, and (iv) H.R. Practices and Hiring policies to attract the best talent. This resolve to change had met with the expected success.

Mr. Jay Desai, sharing the story of the journey of his firm Universal Consulting, stated that by force of circumstance he had to change and evolve continuously to meet the demands of time and of the ecosystem. He started management consultancy for the SME sector with a focus on Operations Improvement, Organisation Structuring and Developing an IT Strategy in 1994 – but he had to rethink and re-strategise in the year 2000 because of the dot.com crash followed by global recession. Adapting to the new reality, his firm then focused on developing strategies for mid-sized and large companies. This led to a change in the business model for the better when their client profile changed from 90% SME sector to 20%, with the rest of the 80% coming from mid- and large-sized companies. Again in the year 2008, with the financial sector crash, his firm decided to deepen focus on different industry verticals so as to have broad-based exposure. While this was helping, there was a recession that followed due to the anti-corruption movement and the lack of policy decisions by the Government which then prompted the firm to focus on implementation of a strategy for growth.

Again in 2020, the corona pandemic occurred that forced a complete overhaul and relook at the way of doing things. Mr. Desai said he abandoned the fixed office concept and created a digital platform enrolling consultants across various domains in different verticals. This helped him build size and scale for consulting and expand his business. At the firm level, they focussed on a single vertical of Life Science and Healthcare catering to their need for strategy, operations and organisational structuring. This led them not only to survive but also helped them to grow. Concluding his story, he added that it was not the ability to predict but the ability to adapt that leads an organisation to survive, sustain and grow.

Several other issues were also deftly handled by the experts. These were:

Treatment of goodwill, partners’ compensation, managing and retaining clients, managing technology, hiring strategies, succession planning, expanding footprints globally like big multinational professional firms, growth vs. profitability, retaining the core of the organisation by the code of conduct and the value system on which the organisation is built.

On the issue of goodwill payment, most panellists felt that goodwill should remain with the firm; on partners’ compensation, the opinion was that it should be based on a proper evaluation based on defined criteria giving full weightage to the fact that each partner could be different in his capabilities, some good on strategy, some on execution, some others on profiling and client acquisition. They must not be made to play a salesman’s role but be made part of the environment that gives them joy and satisfaction to work. Client retention and management could be best managed if the client was given end-to-end solutions and total comfort.

Technology management and hiring strategies was a specialised field and would require a long-term vision and the help of experts; a firm should not hesitate in taking their help. Succession planning should be openly discussed amongst partners and lead candidates as identified should be groomed with special training. Once the succession occurs, the successor should be empowered with full authority and no interference; the handing-over partner should only play the role of a guide.

Although global expansion was a desirable ambition, it required sustained wherewithal to make a mark globally. Some of the experts did share their experience on the challenges posed by local laws, huge investments and regulatory problems. On the issue of growth vs. profitability, the consensus was that they are not mutually exclusive. In the process of growth there was bound to be chaos that would upset the structure of costs and immediate profitability. But eventually it would give rise to a U-shaped recovery with sweet spots emerging by way of enhanced profits and client acquisition.

On retaining the core of the organisation, there was a consensus that growth and the value system forming the core of the organisation were not oxymorons but in fact complementary to each other. Growth based on the strong value system on which an organisation is formed will always be exponential. Anyone acting contrary to this was sure to die.

The panel discussion was followed by a Q&A session when questions and concerns related to many of the above matters were answered by the panellists.

Treasurer Chirag Doshi proposed the vote of thanks. The video link of the panel discussion is available on YouTube and the BCAS website.

MEETING THE MAYOR


President Suhas Paranjpe called upon the Mayor of Mumbai, Ms Kishoritai Pednekar, on Tuesday, 16th February, 2021. At this courtesy meeting, he briefed her about the BCAS and its activities. He also presented her with copies of the BCAJ for the months of January and February, 2021, the 28th Union Budget 2021 publication, the tome ‘Gita for Professionals’ and other publications of the BCAS. The Mayor noted that BCAS is a voluntary body of Chartered Accountants and has been in existence for 72 years with around 9,000 members all over India. She also appreciated the fact that the widely-read BCAJ has completed 52 years of continuous publication and that the annual Budget book was now in its 28th edition. President Suhas invited the Mayor to visit the BCAS office at her convenience.

President Suhas Paranjpe presenting recent publications of the BCAS to the Mayor of Mumbai, Ms Kishoritai Pednekar, when he called on her at her office on 16th February, 2021

SOCIETY NEWS

‘FINALISATION IN ZOHO BOOKS’

The Technology Initiative Committee of the BCAS organised a two-hour webinar on ‘Finalisation in Zoho Books: Challenges and Features’ on 1st May, 2021.

Jigar Shah gave an overview of the finalisation of books of accounts in Zoho Books. The session was interactive and the speaker demonstrated and addressed the following aspects:

1. Challenges that arise when finalising books of accounts for the first time in Zoho Books;
2. Do’s / Don’ts and aspects to take care of while finalising;
3. Key tailor-made / customisable reports to look out for;
4. Key features which can enable users to complete work with greater efficiency and effectiveness; and
5. Productivity aspects in audit finalisation.

The participants were offered an insight into using Zoho Books to finalise their audit and how to mitigate or resolve the issues and challenges that they might face in their audits.

FELICITATION OF ICAI PRESIDENT AND VICE-PRESIDENT

A virtual meeting was organised by the BCAS on 5th May to felicitate newly-elected President Nihar Jambusaria and Vice-President Dr. Debashish Mitra of the ICAI.

Past Presidents, Managing Committee members and core group members of the BCAS and office-bearers of the sister organisation, the Chamber of Tax Consultants, joined the felicitation. Invitees, Central Council members of the Western Region of ICAI and office-bearers of the WIRC were also present.

All those present at the meeting joined in welcoming and congratulating the President and the Vice-President of the ICAI and the Chairman of the WIRC.

BCAS President Suhas Paranjpe welcomed the new President and Vice-President of the ICAI as well as the Chairman of the WIRC. He also acknowledged the presence of the other invitees and pointed out that BCAS can join hands with ICAI for many an initiative for the benefit of the profession at large.

The meeting provided an interesting platform for the exchange of views, ideas and suggestions with the torch-bearers of the regulatory body. Several suggestions were made by the participants about how the image of the profession could be improved, how it could be perceived as an institution for nation-building, how students and their training programme could be reoriented, how ICAI could become more effective in conveying to the Government the genuine issues and grievances of various stakeholders and how it could portray its human face by projecting the various welfare activities that it is conducting.

The participants also requested the new team of the ICAI to throw light on the digital initiatives and the roadmap of the ICAI to deal with various challenges posed by the technological disruptions, the constantly changing arena of the legal framework and the rules and the ecosystem under which the profession operates. The ICAI President was also requested to give his thoughts on the new areas of opportunities for the professionals.

Both the new President and the new Vice-President of the ICAI gave a patient hearing to the suggestions and explained the various initiatives that the ICAI has taken and the rapid strides it has already made to address the various points raised by the participants. They elaborated on the background work done by various committees to create a digital hub and a training and guidance note to deal with new challenges.

ICAI President Nihar Jambusaria stated that after considerable background work the ICAI had been able to develop a ‘Digital Competence Maturity Model’ for members to assess themselves on their digital competence and decide the way forward. He also spoke about the social initiatives and reorientation of the training curriculum for students. He agreed with various suggestions made as regards the need for reskilling of professionals and threw light on some of the initiatives in that direction.

He gave the example of the technology audit tools that the ICAI is developing for the benefit of members and informed them that these will be available to them at almost no cost. He also spoke about the initiative for the MSME sector through the creation of 20 incubation centres. He assured members that a consultative process was going on with the MCA to address various issues on company law to help India achieve its goal of ‘Ease of Doing Business’.

The meeting was conducted in a positive atmosphere and offered great insight into the vision, foresight and plans of the new team at the helm of the ICAI. BCAS Vice-President Abhay Mehta proposed the vote of thanks.

‘AMENDED PARTNERSHIP PROVISIONS AS PER FINANCE ACT, 2021’

The Direct Tax Laws Study Circle held a meeting on ‘Amended partnership provisions as per the Finance Act, 2021,’ on 7th May.

Group leader Bhadresh Doshi gave a brief overview of the proposed provisions in the Bill vis-à-vis the final provisions on the enactment of the Finance Act, 2021. The rationale for the new provisions was discussed based on the Memorandum to the Finance Bill, 2021.

Thereafter, he took up the issue of whether the provisions of sections 45(4), 9B and 48(iii) lead to double taxation. Subsequently, Bhadresh discussed issues relating to multiple assets scenarios and multiple reconstitutions with illustrations. Finally, the impact of the provisions on the waiver of debit balance and stock in-trade were discussed in depth with reference to certain judicial precedents.

SOCIETY NEWS

THE
GLOBAL ENERGY & OTHER CRISES

 

The world is currently experiencing
a plethora of problems – energy crisis, supply chain disruption, chip shortage
and inflation – and these will directly impact our lives and businesses and
also the manufacturing and economic development of the country. We are staring
at shortages of coal and natural gas, along with a sudden spike in the prices
of coal (up 40% to 100% in one year), natural gas (prices have shot up six to
eight times in the last one year) and oil (prediction of oil > $100+).
Global supply-chain bottlenecks are feeding on one another, with shortages of
components and surging prices of critical raw materials squeezing manufacturers
around the world with a delay in turnaround time for containers and congested
ports in the USA and China. This is adding to inflation.

 

The USA walked out of its
20-year-old war on terror in Afghanistan, proving once again that Afghanistan
is the ‘Graveyard of Empires’, having forced the retreat of the USSR, Britain,
the Mughals and the Mongolians. Will China take the risk of entering this
graveyard? Is Pakistan celebrating its pyrrhic victory in humbling two empires
(the USA and the USSR), or will it live to regret it as the international
community is upset with it? India could see the inflow of terrorists into
Kashmir, but with the technology widely used by our security forces, terrorists
are unlikely to have a safe passage.

 

These were some of the points made
at the IESG meeting held on 25th October, 2021. All members of the
group along with CA Harshad Shah gave their views in the course of the
deliberations.

 

‘IMPORTANT
LEGACY JUDGMENTS ON INDIRECT TAXES’

The Indirect Tax Study Circle
organised a Zoom online meeting on ‘Important Legacy Judgments on Indirect
Taxes – Discussion on Principles, Issues & Jurisprudence w.r.t. GST’ on 26th
October. Group leader CA Vishal Poddar had drafted five case studies on
important legacy judgments on indirect taxes. The implications of the
principles, issues and jurisprudence of these cases in the GST era were
discussed.

The case studies broadly covered
the following:

 

1. Penalty u/s 74 for non-reversal
of proportionate ITC u/s 17(2) towards sale of factory building;

2. Taxability and valuation of
supply in case of supply of raw materials by customer;

3. Mismatch in ITC as per GSTR9 and
GSTR2A;

4. GST on royalty for mining,
including RCM provisions; and

5. GST on cost-sharing
arrangements.

 

The participants took active part
in the discussion on all the case studies and the issues were discussed at
length. Mentor Adv. CA Jatin Harjai offered his exhaustive comments on
several aspects covered in all the case studies. Around 50 participants
benefited from the active discussion led by him.

 

ITF
STUDY CIRCLE MEETING

 

The ITF Study Circle’s virtual
meeting on ‘Residence of Companies under the Act and DTAA’ took place on 29th
October.

 

It was led by Group Leader CA Abbas
Moiz Jaorawala who explained the concepts with respect to residence of companies
under the Indian Income-tax Act and DTAA.

 

Determining a company’s residence
status is one of the most important factors based on which taxability is
decided. With this in mind, he walked the audience through the Income-tax Act,
its amendments, DTAAs and various court rulings in relation to residence of
companies. With the help of several simplified illustrations, he lucidly
explained various concepts related to the topic.

 

A
few other speakers also dealt with and answered queries raised by the audience.
The meeting was quite interactive and the participants said they benefited
enormously from the discussion and insights provided. The BCAS
ITF
Study Circle plans to organise such insightful and exciting meetings for
participants in future as well. Details of the upcoming sessions will be shared
with the Study Circle and other members soon.

SOCIETY NEWS

INTERNAL AUDIT INITIATIVES DURING THE QUARTER

The Internal Audit Committee of BCAJ prepared its annual calendar of events and other knowledge-sharing initiatives back in the month of July, 2021. All the events / webinars were bifurcated into four major categories, viz., Internal Audit, Risk Management, Technology and Forensic Studies. The Committee also initiated a plan for a ‘Blog a Month’ styled ‘Internal Audit Matters (Pun Intended)’ which was a collaborative space for issues to be discussed and concerns to be voiced and also to help find solutions. The activities undertaken by the IA Committee during the July to September quarter are summarised below:

A. Blogs
The Blogs were launched in August, 2020 and till date the IA Committee has published 14 posts on various topics related to Internal Audit. Bloggers include several veterans from the field of Internal Audit. The Blogs have garnered a total of 14,000+ views and received 400+ comments. The Blogs published during the quarter were:

An Internal Auditor’s Tale

CA Nandita Parekh

A to Z of a Good Internal Auditor

CA Ashutosh Pednekar

Relevance of Post-Qualification Professional Certifications

CA Nehal Shah

B. Workshop on ‘Conventional and Novel Techniques for Forensic Investigations’
The IA committee, jointly with Chetan Dalal Investigation & Management Services (CDIMS – renowned for conducting forensic and investigation assignments), initiated an E-learning course on Forensic Accounting and Investigation Studies. Over 60 participants have enrolled for the course and about 25 have successfully completed it. As one of the events for course promotion, a half-day workshop was arranged on 27th August at which about 75 attendees were present. CA Chetan Dalal and CA Mahesh Bhatki were the speakers at the workshop. On behalf of the BCAS, the course was coordinated by CA Vishal Mandani, a member of the IA Committee.

Organised via the Zoom software, the workshop covered two topics: 1) Theory of Inverse Logic in Fraud Investigation using the conventional and novel methods with unique and unusual case studies, and 2) Data Analysis using the Novel Quantification Model.

The welcome speech was delivered by President CA Abhay Mehta who pointed out that fraud investigation is one of the evolving areas for qualified professionals since the number of frauds is increasing every day. Further, different methods are being adopted by fraudsters and it is the need of hour to detect such frauds using novel investigation techniques. CA Manish Sampat introduced CA Chetan Dalal and also shared his own experiences gained while working with him on various professional assignments.

CA Chetan Dalal explained the practical approach of using the Theory of Inverse Logic in detecting fraud with the help of various case studies. In one of his case studies, he explained that a person can see a star despite the fact that it may have collapsed by the time its light reaches the earth – because of the tremendous time taken by light to travel. Various case studies relating to insurance claim frauds, misappropriation of assets by fraudsters, etc., were explained along with suggested methods to identify the red flags and carry out systematic investigation.

CA Mahesh Bhatki described how to carry out Data Analysis using a novel quantification model with the help of case studies and examples. The use of Excel and other casewares for carrying out different types of Data Analysis was explained through practical examples to identify the red flags and pursue further analysis to detect frauds.

Participants asked questions related to writing reports post-forensic audit and the benefits of various tools / casewares available for forensic audit. CA Uday Sathaye made the closing remarks and CA Kishore Iyer proposed the vote of thanks.

C. Revival of MOU between BCAS and IIA Bombay Chapter
During the quarter, representatives of BCAS and IIA Bombay Chapter (‘IIA BC’) interacted closely to revisit the MOU entered into in 2017 and review the activities undertaken under it so far. The objective was to ideate and deliberate the areas where there is scope for stronger association and prepare an action plan to implement ideas.

The meeting was successful with both the parties committed to activate the MOU through a series of innovative and interesting initiatives all through the year. Various joint events, activities and initiatives to advocate Internal Audit, Joint Internal Audit Training Programmes, Events and Activities to bring BCAS and IIA members on the same platform, to plan some joint publications, to host a few lecture meetings every year with experienced speakers and so on were identified.

D. Curtain-Raiser Event with IIA BC
A virtual curtain-raiser event was organised by BCAS along with IIA Bombay Chapter on 18th September to announce the above-mentioned initiatives. The event was organised to provide detailed insights into various certification programmes offered by IIA globally as well as the CIA challenge examination specifically designed for Chartered Accountants who wish to build their career in IA. The speakers, both from IIA BC, were CA Percy Amalsadiwalla, the current president of IIA BC, and CA Chetan Thakkar, member of the BOG of IIA BC.

The event commenced with a welcome address by CA Mihir Sheth, Vice-President of BCAS. The opening remarks about the new initiatives planned jointly with IIA BC and the curtain-raiser event were made by CA Nandita Parekh, Co-Chair of the IA Committee of BCAS. Both speakers were introduced by CA Nirav Mehta, a member of the IA Committee.

CA Chetan Thakkar opened the technical sessions by describing the mission, goals and objectives of the global institute IIA, global statistics of its members / affiliates / countries, etc., benefits of IIA memberships of IIA India, various certifications offered globally by IIA, CIA exam fees and resources available for study.

CA Percy Amalsadiwalla shared information about the CIA Challenge exam, a single exam specifically designed for eligible members of the 17 qualified accounting bodies of various countries, which includes ICAI members. The speaker scrolled through various FAQs designed by the IIA for the CIA Challenge exam which included eligibility, documentation, registration process, syllabus, schedule, fees, etc. He also announced a special offer to all BCAS members desirous of taking the CIA Challenge examination, preferential rates for becoming IIA members, namely, 10% discount in membership fees for the year 2021-22 and waiver of one-time registration fees of Rs. 1,500 for a short window between 18th September and 15th October. The questions posed by the participants were addressed by both speakers.

The event was attended by 107 participants. The vote of thanks was proposed by CA Atul Shah, Convener of the IA Committee of BCAS. The event is available for viewing on YouTube video link: https://www.youtube.com/watch?v=_vt6kbuj5Ww.

Or, watch it at:

 


 

 

E. Workshop on An overview of Tableau and Power BI
A unique virtual workshop to explore new possibilities on Audit Analytics with the ‘magic of data visualisation’ for internal auditors was organised by the IA Committee. It was designed in such a way that it provided training for two hours every day for four days from 22nd to 25th September.

The welcome address was delivered by President CA Abhay Mehta. Opening remarks about the workshop and the introduction of speakers was done by CA Uday Sathaye, Chairman of the IA Committee.

Mr. Asif Rampurwala and Ms Sajeela Sagar gave an overview of the Tableau on the first day. Ms Sagar conducted the interactive workshop on the Tableau on the second day. Ms Deephika S. conducted the interactive workshop on Power BI on the third and fourth days.

The workshop was attended by 36 participants of different age groups (including six young members and five senior citizens) from different cities (24 from Mumbai and 12 from other cities). The workshop was quite interactive and the participants were pleased with the knowledge gained by them.

The votes of thanks for the speakers were proposed by Ms Purvi Malani, a Convener of the IA Committee, and Ms Mitalee Chovatia, a member of the IA Committee.

‘EXPECTATIONS MANAGEMENT’ BY MAHATRIA

The Human Development Study Circle arranged a Zoom meeting on ‘Expectations Management’ by Shri Mahatria on 10th August. It featured a video screening followed by a discussion led by CA Vinod Kumar Jain.

The meeting commenced with the screening of a video on ‘Expectations Management’ delivered by Shri Mahatria from Infinitheism. Initially, Mr. Manohar from Infinitheism shared information about various activities and works being undertaken by Shri Mahatria and Infinitheism.

He revealed that for over 25 years Shri Mahatria has been empowering millions across the world to live a life of ‘Holistic Abundance’. He helps people to overcome their belief systems and conditioning and to discover breakthroughs in health, wealth, love, bliss and a spiritual connect. People from all walks of life find their success, purpose, peace, happiness, faith and miracles with Infinitheism, the path of holistic abundance.

In the video, Shri Mahatria explains the importance of discipline for any nation or individual to grow. It is very important to give one hour to the body through exercise, etc., only then can the body take care of itself for the next 23 hours. He said that when seeker and giver meet with strong intensity, transformation takes place, otherwise it is only a mere exchange of information.

Shri Mahatria pointed out that people continue with their childish behaviour – first they cry for a Rs. 60 car in childhood and then for a Rs. 60 lakh car in adulthood. This ‘crying’ becomes acute with anger, frustration, disappointment, depression, unhappiness, sadness, envy, jealousy, etc. He noted that if we squeeze a lemon, lemon juice will come out, and when we squeeze a grape grape juice will come out. Similarly, what is inside will come outside – when life squeezes us, what comes out of us is that which is inside us.

We need to channelize our emotions. There is no point in cribbing or spitting our emotions; it is better to give them a direction. Our life’s greatest turning point may be a big setback… Most of our frustration comes from our choices like standing below a mango tree and expecting oranges to fall at our feet. We have a right to choice; consequences are always born of existential (God) forces.

Out of every choice, as per the design of life, there are four possible consequences – getting what is expected, getting more, getting less or getting the opposite. Life is not linear but cyclical. No matter what you get, you need to go back and execute the next choice. Good results can be seen as motivators and negative results will bring experience and maturity.

Shri Mahatria concluded by suggesting that we follow CAR, or Change the changeable, Accept the unchangeable, or Remove yourself from the unacceptable.

After the video presentation, CA Vinod Jain explained in brief the learning from this video.

PRE-PACKAGED RESTRUCTURING

President CA Abhay Mehta welcomed the participants at the lecture meeting on ‘The Pre-packaged restructuring – The way to go’ organised by BCAS on 1st September.

The speaker, CA Sajeve Deora, started with the  introduction and history of bankruptcy law as introduced in British India and then amended by various laws and authorities in the post-Independence era. The Government introduced the Insolvency Law in 2016 but it was found to be wanting in some aspects relating to MSME businesses.

 

 

MSME businesses are peculiar in certain aspects like predominantly being managed by the promoter, dependency on the promoter’s skills, personalised relationship between the promoter and stakeholders, and hence replacing the promoter from the management can be difficult for the business, apart from the high cost of CIRP (Corporate Insolvency Resolution Process) for the MSME business entity.

Pre-packaged restructuring as it stands today is available only for MSMEs. It provides an opportunity to them to act before the creditors take action. However, it is expected that management should be acting in a bona fide manner and not to defraud its creditors and other stakeholders. The promoters would be able to restructure the debts and assets of the business with the support and sacrifice of all stakeholders, including Government, pension funds, creditors, lenders, etc.

The speaker also shared his experience of international practices for Pre-packs in the UK, the USA and Germany.

Speaker CA Sajeve Deora then dealt with various important aspects of PPIRP (Pre Package Insolvency Resolution Process) covering:
• Eligibility criteria,
• Process of initiating PPIRP and filing the application,
• Process during formulation of resolution plan,
• Removal of promoters by CoC (Committee of Creditors) during PPIRP,
• Duties and powers of promoters / management during PPIRP,
• Restructuring process under resolution plan,
• Contents of resolution plan,
• Approval of resolution plan,
• Termination of PPIRP,
• Suggested / model timelines for PPIRP,
• Implementing sustainable restructuring.

Later, he responded to all the queries raised by the participants.

The meeting concluded with a vote of thanks.

Youtube Link – https://www.youtube.com/watch?v=W9W7l4px1Aw
QR Code

 

 ‘VALUATION PRINCIPLES AND DEFINITION OF CONSIDERATION UNDER GST’

The Indirect Tax Study Circle’s meeting on the above subject was organised on 13th September through the Zoom process.
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This was the Indirect Tax Study Circle’s fifth meeting of the year 2021-22. It was addressed by Group Leader CA Umang Talati and Mentored by CA Deepak Thakkar.

Group Leader CA Umang Talati had prepared six case studies on the law and practical issues covering Valuations and Considerations under GST. The presentation broadly covered the nuances of the definition of Consideration as well as Valuation Issues on:

1. Write-back of deposits,
2. Vaccination drives during the pandemic for employees, vendors, relatives,
3. Pure agent concept for tour operators and different models of valuations of package tours,
4. Valuation implications of TDR,
5. Can cryptocurrency be considered as consideration?
6. Job work valuations.

The participants took active part in the discussion on all the case studies and the issues were discussed at length. Mentor CA Deepak Thakkar made exhaustive comments on a variety of aspects covered in all different case studies. Around 60 participants benefited from the active discussion lead by the Group Leader and the Mentor.

UNDERSTANDING THE LAW AND SCIENCE OF KARMA

The Human Resources Development Committee of the BCAS organised a meeting, presented by CA Vijay Mehta, on ‘Understanding the Law and Science of Karma,’ on Tuesday, 14th September, on the virtual online platform.

The discussion was focused on Karma from the perspective of Law and Science.

The Law of Karma is based on the law of causality. Since it is based on natural and universal law, it is governed automatically and requires no interference from anyone to operate or control it. The rules are universally applicable to all living beings. The Law of Karma gives justice equally to all without any exception. The example of the 19th Tirthanker was cited in support of its universal application and justice irrespective of position. However, an exception from its ambit was carved out for Sidhha Jiva. They are the ones who have destroyed the reason / cause, namely, attachment and aversion (Raag and Dwesh) necessary for Karma to bond with the Soul.

To better understand the law, Karma is compared to a Court, a Doer (Karta) with an Accused, and a third person who only executes the judgment of the Court / judge as a Jailor. Drawing a parallel, anyone fighting with the Jailor, who is ordered to give punishment, increases the sentence ordered by the Court. The importance of periodicity of seeking immunity was explained in a nutshell. The procedure for lifetime immunity was explained with compounding fees, as decided by Guru, to be compensated to get rid of bad Karma.

The science of Karma is based on the principle that every action has its reaction in the opposite direction. Karmaisa Karmic particle mixes with the Soul like water with milk. These Karmic particles are grouped atoms of matter known as Karman Vargana. They get bonded to a soul like a magnet attracting iron particles. The Soul continuously engages in Raag and Dwesh, which creates a magnetic force to attract karmic particles. This Karma gives its effect upon maturity. Functionally, Karma covers and vitiates the virtues of Souls. Bondage of Karma is the leading cause for the Soul not experiencing and experiencing its virtues diversely. Karma is broadly classified and named in eight categories for eight significant virtues of the Soul. For example, the quality of infinite knowledge of the Soul covered by Karma is called Gynavarniya Karma.

The four stages of Karma, namely, influx, bonding, silent period and ripening, were explained in a nutshell. During the third stage or the silent period, it is possible to reduce past bad Karma (Paap Karma) and increase past good Karma (Punya Karma) if one knows the Science of Karma.

Summing up, Karma is portrayed as the enemy since it causes a never-ending cycle of birth, death and misery. But knowing the Science of Karma is important because it is only during human life that this knowledge can be put into action.

INTERPLAY OF NEW AND OLD PENALTY PROVISIONS UNDER THE INCOME-TAX ACT, 1961

The Direct Tax Laws Study Circle Meeting on ‘Interplay of new and old penalty provisions under the Income-tax Act, 1961’ was held online on 17th September.

The Group Leader, CA Krishna Upadhyay, gave a comprehensive analysis of the erstwhile section 27(1)(c) of the Act. The provisions of section 270A were also discussed at length with illustrations. The exceptions to under-reported income were discussed in detail. Further, the differences between 270A and 271(1)(c) were highlighted by the Group Leader.

Thereafter, he discussed in detail the immunity provisions of section 270AA with illustrations. The session ended with the speaker making his concluding remarks and suggesting practical steps to be taken on receipt of a penalty notice.

ENERGY SECURITY, FOOD SECURITY AND DEFENCE SECURITY – LEADING TO OVERALL ECONOMIC SECURITY

The International Economics Study Group held its meeting on 28th September to discuss ‘Energy Security, Food Security and Defence Security – Leading to Overall Economic Security’. CA Shalin Divetia led the discussion and presented his thoughts on the subject.

He presented AtmaNirbhar – the Holistic Approach to National Security – and provided crucial aspects of each of the critical issues. As regards Food Security, India is a net exporter of agri-related products but edible oil and pulses have still to be imported; India will overcome this hurdle very shortly.

Energy Security is very critical due to our overdependence on oil imports but the Government is bridging the gap with ethanol blending and renewable energy.

As regards Defence Security, India has focused on Make in India, although it is one of the largest importers of arms, to overcome  the shortfall and the current initiatives are paying rich dividends which got further strengthened by PLI. With this, India appears to be on the path to economic security with Forex reserves climbing to all-time highs.

CA Harshad Shah presented his thoughts on ‘China’s Evergrande Debt crisis – Cause and Effects’, and highlighted that Evergrande is the second largest real estate developer (and also the world’s most indebted real estate firm) and any adverse development could spill over to China’s real estate sector (which is highly overleveraged) and contributes about 29% of the GDP; but any mess-up in this sector could spiral into a potential debt crisis as China is also highly leveraged with a debt-to-GDP ratio of around 300%.

But then China has the comfort that most of its debt is financed by very high domestic savings of 45%. Evergrande’s woes are merely the symptom of a much bigger problem as Chinese regulators have introduced ‘3 red lines’, a stress test and Mr. Xi’s slogan of ‘common prosperity’. The measures include making housing more affordable and ridding the property market of speculation. But any accident or misstep could result in a domino effect and downturn in the economy, debt crisis, unemployment and probable social unrest.

SOCIETY NEWS

SOCIETY NEWS

SOCIETY NEWS

ENHANCING AUDIT QUALITY

The BCAS organised a virtual lecture by CA P.R. Ramesh on ‘Enhancing audit quality & enhanced reporting obligations’. It was planned keeping in mind the changes in the Companies Act, 2013 on audit quality and reporting norms.

The Managing Committee, along with the Accounting and Audit Committee, organised the event on 14th July. Vice-President CA Mihir Sheth welcomed the gathering and introduced the speaker.

Mr. Ramesh took participants through the current environment of audit, audit quality expectations, new CARO amendments and their reporting and other emerging reporting obligations like integrated reporting and ESG reporting.

He explained the current environment with various quotes and media displays; he touched on the complexities in the business transactions of today; the biggest failures across the globe and the big corporate failures. He also covered the current concerns such as poor corporate governance, lack of ethical behaviour, credibility of oversight and enforcement actions, failures due to shoddy accounting and auditing, and auditors missing glaring signs of failure.

Covering audit quality aspects, he stated that the statutory audit is the sixth line of defence, the first five being higher level management, functional and process managers, risk management and compliance functions, internal audit, and board and other committees. The basic building blocks of good audit quality were various structural, environmental and output factors, oversight and evaluation and execution issues. He laid special emphasis on audit procedures, the tools and techniques used and evaluation of audit results.

He also discussed the importance of communication to those charged with governance about routine, special and other matters, including auditor’s independence, communications; form, type and format of audit report and its qualitative and quantitative factors; management letter and group audits.

Mr. Ramesh then took up the history of the evolution of CARO, the key considerations and audit procedures in relation to the recent changes in CARO such as:
* reporting on proceedings initiated or pending against the company for holding any benami property under the Benami Transactions (Prohibition) Act, 1988 (45 of 1988) and rules made thereunder;
* reporting on whether at any point of time during the year the company has been sanctioned working capital limits in excess of Rs. 5 crores in aggregate from banks or financial institutions on the basis of security of current assets; and also whether the quarterly returns or statements filed by the company with such banks or financial institutions are in agreement with the books of accounts of the company;
* reporting on whether during the year the company has made investments in, provided any guarantee or security, or granted any loans or advances in the nature of loans, secured or unsecured, to companies, firms, LLPs or any other parties;
* details of investments, any guarantee or security or advances or loans not prejudicial to the company’s interest;
* whether any transactions not recorded in the books of accounts have been surrendered or disclosed as income during the year in the tax assessments under the Income-tax Act, 1961 (43 of 1961), and if so, whether the previously unrecorded income has been properly recorded in the books of accounts during the year [Clause 3(viii)];
* whether term loans were applied for the purpose for which they were obtained; if not, the amount of loan so diverted and the purpose for which it was used may be reported;
* whether funds raised on short-term basis have been utilised for long-term purposes; if yes, the nature and amount to be indicated;
* whether any fraud by the company or any fraud on the company has been noticed or reported during the year; if yes, the nature and the amount involved is to be indicated;
* whether the auditor has considered whistle-blower complaints, if any, received during the year by the company;
* existence of any material uncertainty on the date of the audit report and various other clauses.

The amendment to Schedule III of the Companies Act, 2013 and Amendments to the Companies (Accounts) Rules, 2014 were also covered.

Mr. Ramesh took up topics related to Integrated Reporting which is a concise communication about how an organisation’s strategy, governance, performance and prospects in the context of its external environment lead to value creation over the short, medium and long terms. He pointed out that on 25th March, 2021, SEBI decided to make the Business Responsibility and Sustainability Report applicable to the top 1,000 listed entities (by market capitalisation) for reporting on a voluntary basis for F.Y. 2021-22 and on a mandatory basis from F.Y. 2022-23.

He answered all the questions raised by the participants on the chat and Q&A box.

The key takeaways from the session were:
• Increased disclosures in financial statements with respect to clauses contained in CARO 2020 with the aim of increased compliance for the matters contained therein;
• Increased role of the CFO with the focus on compliances with certain laws and regulations, sanity of financial information furnished to banks, and to take note of adverse financial positions and corrective measures;
• Increased data-sharing with auditors and coordination required for concluding prior to sign-off;
• The overall quality of reporting by the auditors expected to increase on the financial statements of the company and thereby lead to greater transparency;
• Responsibility on the management for additional disclosures in the financial statements on various aspects relating to financial discipline, ageing, end-use of funds, etc.

The vote of thanks was proposed by CA Chirag Doshi. A large number of participants attended the online meeting. Its archival video has, in a short time, garnered a few thousand views.

A video of the same is available on YouTube at link: https://www.youtube.com/watch?v=gAbYUI8hOgs

Introducing a new feature, the BCAJ invites readers to scan the following QR Code that will help them to download the meeting and glean the knowledge shared by speaker P.R. Ramesh.


A MOVIE WITH TWISTS AND TURNS

The Human Resources Development Study Circle organised the screening of a film, ‘Ek Cheez Milegi Wonderful’, on the online platform on 25th July. The screening was sponsored by CA Vijay Mehta.

It was like family time for members as they watched it in the comfort of their homes. The three valuable hours that they spent on the movie helped bring home the message that in order to live better lives, it is best to make each other more comfortable and happy within the home. This was one of the lessons that was conveyed by the movie which was appreciated by the viewers.

The movie ‘Ek Cheez Milegi Wonderful’, offered both inspiration and motivation. In a world that craves and celebrates material things in lieu of happiness, the movie leads viewers to the actual meaning and essence of being happy. It reveals how ‘knowledge’ is a unique, unparalleled characteristic of the entire bio-world. It poses the question, what differentiates us humans from the rest of the living beings? Are we really higher than all of them on the pyramid of the living world?

Like any typical film, the movie features several twists and turns that keep the viewers focused till the very end when all the characters in it agree to the ‘universal truth’.

A must-watch movie, it is available on YouTube at the link https://youtu.be/lJNSpKWHwcg.

CHANGES IN COMPANY LAW & AUDITING

The Students’ Forum under the auspices of the HRD Committee organised a training session for CA Article Students on ‘Changes in Company Law & Auditing’ via Zoom Meetings on 26th July.

The Study Circle was led by CA Shraddha Kishnadwala, an expert on the subject.

CA Dnyanesh Patade, the co-ordinator, introduced the speaker and spoke about the various activities and events conducted by the BCAS Students’ Forum and encouraged the participants to take active part in its events.

Shraddha Kishnadwala then described the various changes in the Company Law in a lucid manner. She also explained the audit and verification procedures that can be followed and their impact on reporting.

The session was divided into three parts, viz., (a) Changes in Schedule III reporting, (b) Other major changes in the Companies Act, and (c) Auditing Procedure and Changes in CARO. The speaker pointed out that the Companies’ Amendment Act had bought about many changes in reporting, format and compliance.

The programme ended with CA Dnyanesh Patade, member of the HRD Committee, proposing the vote of thanks. About 160 students participated in the interactive session and they offered a positive feedback.

The session can be viewed on the BCAS YouTube Channel at: https://www.youtube.com/watch?v=Tt76E_C8Alc

TAXATION OF INDIVIDUALS

The Direct Tax Laws Study Circle Meeting on ‘Taxation of Individuals (Including Expats) with Special Emphasis on Taxing Accretion to Employer’s PF Contribution’ was held on 30th July.

Group leader CA Deepashree Shetty gave an overview of the residency criteria applicable for individuals and the tax relief measures available on account of Covid-19. She also discussed the key consideration for tax residency and taxation of the salary income of individuals (including expats).

Thereafter, she spoke on the tax implication of social security contributions (including that for expats). She also threw light on the impact of the newly-inserted Rule 3B and took the participants through the mode for computation of taxable amount and the practical challenges in computation under Rule 3B. The session ended with Deepashree discussing the provisions related to international work (i.e., expats) and the benefits of social security agreements.

FCRA AND RECENT AMENDMENTS

The FEMA Study Circle of the BCAS and the Financial Management Service Foundation (Delhi) came together for a discussion on ‘FCRA and Recent Amendments’. The meeting was led by Dr. Manoj Fogla, Dr. Sanjay Patra, CA Suresh Kejriwal and Mr. Sandeep Sharma. It was held on 31st July.

The session started with an introduction of the Foreign Contribution Regulation Act, 2010 (FCRA), followed by an in-depth analysis of its key provisions and the recent amendments. The speakers focused on details of the FCRA provisions and addressed the queries raised by the participants. The presentation was followed by a Q&A session.

The speakers pointed out that the recent amendments in FCRA have helped the authorities regulate the flow of funds received from foreign sources. However, this has also drastically changed the manner in which projects are executed by charitable institutions. This had created a lot of anxiety amongst them as well as the professionals advising them. It was no surprise that there were more than 1,300 registrations for the event with participation from charitable institutions and professionals alike.

Society News

SEMINAR ON AUDITOR’S ROLE IN CONTROLLING INCREASING FRAUDS
The Internal Audit Committee of BCAS held its 2nd physical event of the year on 4 November, 2022 at Orchid Hotel in Mumbai. Titled, “Here a Fraud…There a Fraud…Everywhere a Fraud Fraud,” The event was themed around the increasing trends of frauds in today’s scenario and the role that Internal Auditors have in this ecosystem.

A total of 25 participants across various industries and practices attended this event. Subject matter experts and seasoned professionals also graced the event, including CA Sandeep Baldava, CA Deepa Agarwal, Mr. Sachin Dedhia, CA Chetan Dalal and CA Mahesh Bhatki who shared their decades of experience through innovative, practical, and relevant tools and case studies.

Each session was uniquely designed to cater to various relevant topics in today’s context. Some of the key topics covered include:

  • Role of Internal Auditors in Fraud prevention and detection
  • How Internal Auditors can assist Statutory auditors in discharging their duties effectively
  • Emerging Digital Financial frauds, their modus operandi, and tips for early detection of such frauds
  • Identifying early warning bells to detect and prevent frauds
  • Significance and use of data analytics in fraud detection
 
INDIRECT TAX STUDY CIRCLE MEETING ON ASSORTED INDIRECT TAX ISSUES
The Indirect Tax Study Circle organized two meetings in October 2022 on a Zoom platform to discuss various assorted issues.

The sixth meeting for the year 2022-23 was organized on 17th October 2022., wherein various issues revolving around the concept of actionable claims were addressed by group leader CA Raj Khona, Mumbai and mentored by CA Adv. Jatin Harjai.

Group leader CA Raj Khona made five exhaustive case studies. The presentation broadly covered the significant ramifications of the subtle changes on the following topics:

– Actionable Claims, their legal meaning and utility and applicability in various transactions w.r.t. the GST perspective

–  Clause (e) of Para 5 of Schedule II to CGST

–  Sundry write-backs or write-offs

–  Insurance claims received/rejected, partial claims, dissecting each word of clause (h) of sec 17(5) of CGST Act, valuation provisions

–  Implications of recent judgment concerning sports

Around 65 participants actively participated in the discussions on the three case studies. Mentor CA Adv Jatin Harjai gave his guiding comments on various aspects covered in all different case studies.

The next meeting, being the 7th meeting for the FY 2022-23 was held on 29th October 2022. The meeting was addressed by group leader CA Neha Sethi, Delhi and mentored by CA Pritam Mahure, Pune.

Group leader CA Neha Sethi made five case studies addressing the intricacies and issues of the topic revolving around the decision of the Honorable Supreme Court in the Case of Northern Operating Systems. The presentation and discussion broadly covered the intricacies of the following topics:

1. Economic Employer vs Legal Employer in case of Secondment

2. Issues w.r.t. to Reverse Charge Mechanism. Payment due date. Timelines for claiming ITC if reverse charge is unpaid

3. Effect of transfer pricing adjustments considered in the books or only as reconciliations in from 3CEB without giving effect in books of accounts

4. Connected macro agreements to determine the correct facts.

5. What if the agreement prescribes the valuation model at cost plus 10 per cent?

6. Issues of a reimbursement model for a tour operator? Whether the same is legally allowed or not?

Around 75 participants from across India benefitted by actively participating in the discussions. Mentor CA Pritam Mahure clarified the issues and queries raised in the variety of aspects covered in all different case studies with the support of the observations laid down in Northern Operating Systems and other legacy case laws of Ily Lilly, etc

MEETING ON “RECENT AMENDMENTS TO FEMA PERTAINING OVERSEAS INVESTMENTS.”
The Suburban Study Circle organized a meeting on 15th October, 2022 on the topic “Recent Amendments to Overseas Investment Regime in India.” At the meeting, CA Hardik Mehta made an insightful presentation and shared his views on the following topics:

  • Enhanced clarity concerning various definitions and routes for Overseas Investment
  • Introduction of the concept of “Strategic Sector” and “Bona fide Business Activity”.
  • Insights on further development in Round tripping of Investments.
  • Understanding the issuance of corporate guarantees to or on behalf of the second or subsequent level step-down subsidiary (SDS) and deferred payment of consideration.
  • Important changes in the reporting requirement
  • Introduction of “Late Submission Fee (LSF) for reporting delays.
  • Other important amendments with relevant Posers/ Observations.
DISCUSSION ON PRACTICES UNDER OUR INDIAN CULTURE
The Human Resources Development Committee (HRD) organized a Human Resources Development Study Circle meeting on 11th October, 2022 to discuss the topic. “Aisa Kyun? (Practices under our Indian Culture).” The discussion was presented by CA Vinod Jain who spoke in Hindi on the topic “Aisa Kyun”, Why we follow certain practices under our Indian Culture, e.g. Touching feet, Putting Tilak on the forehead, using a Swastik, the significance of bells in temples, etc.

Mr. Jain began his discussion by sharing that in Haryana, there is a saying that people should not sleep, keeping their legs towards Ravana’s Srilanka. He said today, we know the law of association but not the exact reason or science behind various practices followed in our Indian Culture.

He elaborated on how various practices should be followed, such as doing Namaste and Charan Sparsh (touching feet), the reasons behind the same and the benefits of observing the same. Such as, one cannot be angry while doing Namaste. During the Covid period, the entire world appreciated greetings through “Namaste” while maintaining social distance.

He also shared in detail about the scientific reasoning and benefits of putting Tilak and its association with the third eye chakra. Various materials were used for putting Tilak by different communities and the reason behind the same. He also shared the reasoning behind females wearing Natha, the benefits and science of using the sacred symbol of Swastik, etc.

He explained the science and reasoning behind the design and Vastu of ancient Indian temples. Why is Gumbaj used, and Om is pronounced underneath it? The benefits and logic of using “Ghanta” (bells) in temples, not wearing shoes etc. He explained in detail the reasoning and benefits of various practices followed in temples and how and why they differ from churches.

You can view the recording of this event. Visit the below link or scan the QR code with your phone scanner app:

Link – https://www.youtube.com/watch?v=4VgcZOTxczg

FIFTH EDITION OF INTERNAL AUDIT 101 AT BCAS

The 5th Edition of the Internal Audit Committee’s flagship event – “Internal Audit 101 (IA 101) was held on 14th, 15th & 16th of September 2022 in physical mode at the BCAS Auditorium in Mumbai. IA 101 is positioned as a Foundation Course for new entrants to Internal Audit and a refresher course for seasoned IA professionals.

On day 1, CA Mihir Sheth, President- BCAS, welcomed all the participants by sharing his views on the BCAS Internal Audit Committee’s vibrant programs and expressed his best wishes to all participants for the 2 and a half days.

The various sessions over 2.5 days were coordinated and anchored by young committee members – CAs Khushi Shah, Kishore Iyer, Prajit Gandhi and Samit Saraf.

The closing remarks on Day 3 were given by CA Uday Sathe, Chairman, Internal Audit Committee, wherein he expressed his gratitude to all esteemed speakers, panellists, committee members and participants for making the IA 101 an event that participants from all age groups will look forward to.

SEMINAR ON CHARITABLE TRUSTS
The Corporate and Commercial Laws Committee organised its annual programme on Charitable Trusts on 2nd September 2022 in a hybrid mode this year.

The program had 243 participants from 45 cities in India comprising 57 in physical mode and 186 in virtual mode.

CA. Gautam Nayak, Past President, BCAS, kick-started the first session with his astute views on the direct tax matters posed by the program mentor and director CA. Dr. Gautam Shah. The physical address by Hon. PCIT (Exemptions) Shri Anurag Sahay, Mumbai, was insightful in understanding the revenue expectations, chances of condonation of delay in filing procedural forms and compliances by the charitable trusts. PCIT Sir was candid in accepting the flaws in the ITR-7 and other Income Tax Compliances on the portal.

The next session was a classic disposition on FCRA applicable to the trusts. The compliance is taxing for the genuine trusts in an area for which the ministry of home affairs has tightened its controls. CA. Suresh Kejriwal from Kolkata joined online through zoom while CA. Anjani Sharma from New Delhi joined in physically to address the audience. The duo jointly covered the intricate issues and attended to the questions posed by the audience.

In the post-lunch session, the Treasurer of BCAS, CA. Zubin Billimoria covered in detail the CSR requirements as per the Companies Act, 2013 while Ms. Ingrid Srinath acquainted the audience with the nuances of the Social Stock Exchange – Its sunrise and its way forward. Both sessions were quite interactive.

The last session included a panel discussion on the various Litigation issues concerning GST. The new-born GST law had a young panel comprising panellists CA. Abhay Desai from Vadodara, CA. Mandar Telang, Managing Committee Member of BCAS and CA. Gaurav Save as the moderator. Both CA Desai and CA Telang dwelt upon the whole concept of the applicability of GST by answering various aspects of the law divided in different buckets by the moderator. Prosand cons of aggressive as well as conservative stands were discussed by the panel.

CA Gunja Thakrar and CA Gaurav Save with the help of convenors CA Bhavesh Gandhi and CA Sneh Bhuta and under the guidance of CA Gautam Shah and
CA Abhay Mehta ably coordinated the programme.

TWO MEETINGS ON RECENT GST AMENDMENTS
The Indirect Tax Study Circle organised two online zoom meetings in August 2022 to discuss the recent amendments made by the 47th GST Council Meeting. The topics discussed included:

I. Renting of Residential Dwelling on 6th August, 2022

Group leader CA Adyta Surte made seven exhaustive case studies on the recent changes in GST law with respect to the changes in exemption and reverse charge mechanism notification in relation to renting residential dwellings. The presentation broadly covered the major ramifications of the subtle changes on the following topics:

1.    Charging of GST on forward charge in case if specified category is provided in reverse charge and related repercussions

2.    Does a commercial electrical meter constitute a commercial property?

3.    Eligibility of ITC in case the property is partially used for residential as well as business purposes

4.    Issues regarding renting of flats by Company for the use of its directors

5.    Is registration necessary to discharge GST in another state, or can IGST be paid for the same?

6.    Differences between renting residential dwellings and accommodation services

Mentor CA Vikram Mehta gave his guiding comments on various aspects covered in all different case studies. 146 participants attended the meeting.

II. Goods Transport Agency on 18th August 2022

Second meeting was held on 18th August 2022 on the topic “Goods Transport Agency”. The group leader was CA Jignesh Kansara who was mentored by CA Vasant Bhat.

Group leader CA Jignesh Kansara made 13 case studies addressing the intricacies and issues in the Goods Transport Agency segment, especially concerning changes made by the 47th Council. The presentation and discussion broadly covered the intricacies of the following topics:

1.    Tax treatment under different methods

2.    Differentiating points for payment under the Forward charge and when the recipient is liable to pay under the reverse charge

3.    Whether a switchover is possible between rates of 5% & 12%

4.    Issue of consignment notes and intricacies thereof

5.    Case studies emanating out of the Reverse Charge Mechanism

6.    Procedural lapses regarding non-information to Jurisdictional officers

Over 120 participants benefitted from the active discussion.

LECTURE MEETING ON RECENT IMPORTANT DECISIONS IN INCOME TAX
BCAS organized a hybrid lecture meeting on “Recent Important Decisions in Income Tax” by Adv. Hiro Rai on 15th June, 2022. The key takeaways of the lecture meeting are as follows:

1)    Reason and logic behind every judgment help you to understand the issue in-depth and helps in future when one faces the same issue. The first judgment he dealt with was Union of India vs Ashish Agarwal. He shared some of the important points from the judgment. One of them was that Supreme Court lays down that new Section 147 can even be applied to earlier years too. This can affect the arguments for cases under the old provisions, as new requirements are extensive.

2)    The second judgment covered was DIT vs Mitsubishi Corporation, dealing with advance tax and interest u/s 234B for non-residents. Supreme Court held that the section deals with tax deductible at source. The main argument made was an amendment made on 1st April, 2012 in Section 209(1)(d), which says that tax deductible is not to be reduced if the payer has paid the amount without tax deduction. Since this amendment was made, the assessee’s stand before 1st April, 2012 was upheld. He also explained the importance of the said argument as it can be applied by departments too in various other cases.

3)    Another critical Supreme Court judgement dealt with was Shakti Metal Depot vs CIT dealing with section 50 of the Act. The Supreme Court upheld the decision of the High Court dismissing the appeal of the assessee by supporting the argument that merely not using the asset for couple of years for business doesn’t impact the character of the asset in the block and any gains of sale of such asset should be treated as short term capital gains.

4)    The next judgment discussed was South Indian Bank vs CIT, dealing with Section 14A. The important point of the department, which was negated by the Hon. Supreme Court was that nowhere it is written that separate books of accounts need to be maintained by the assessee.

5)    During his talk, the faculty also touched upon many other important decisions from the Supreme Court, High Courts and the ITAT. He also answered various queries posted by the participants.

BCAS Lecture Meetings are high-quality professional development sessions which are open-to-all to attend and participate. If you have missed the Lecture Meeting, but still interested in viewing the entire meeting video then…

Visit the below link or scan the QR code with your phone scanner app:

Link – https://www.youtube.com/watch?v=LwsgqqNj0RI

MEETING TO DISCUSS GUJARAT HIGH COURT RULING

The Indirect Taxes Law Study organised its 3rd meeting for the year 2022-23 to discuss the outcomes of Hon. Gujarat High Court judgment in the case of Munjaal Manishbhai Bhatt v. UOI organised on 14th July 2022, the meeting was addressed by group leader CA. Yash Parmar & mentored by CA. Naresh Sheth

The group leader CA. Yash Parmar prepared 6 case studies based on the judgment delivered by the honourable High Court of Gujarat in the case of Munjaal Manishbhai Bhatt v. UOI covering various aspects of the real estate sector, which shall have ramifications due to reading of the valuation of land. A participative discussion covered various practical aspects of the scheme, such as:

1.    Implications when the value of land is not separable

2.    Transfer of UDS along with constructed flat

3.    Transfer of land as a conveyance to society

4.    Interpretation difference of terms Prescribed Vs. Notified

5.    Theory of accretion

6.    Issues in the refund

Around 57 participants benefitted from the informative discussion.


LECTURE MEETING ON “FILING OF INCOME TAX RETURNS”
On 13th July 2022, the Bombay Chartered Accountants Society organised a hybrid lecture meeting on the topic “Filing of Income Tax Returns for A.Y. 2022-23” by CA Jhankhana Thakkar and CA Utsav Shah. The opening remarks were given by the President, Mihir Sheth, followed by an introduction of the speakers. The lecture meeting was divided into two parts-

i.   CA Jhankhana Thakkar lucidly explained the amendments brought in by the Finance Act 2021 and The Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020 which have an impact while determining the income for the previous year relevant to A.Y. 2022-23.

ii.   CA Utsav Shah explained the various changes made in the income tax return forms for A.Y. 2022-23 notified by the CBDT. He pointed out the practical points one needs to keep in mind while filing income tax returns.

BCAS Lecture Meetings are high-quality professional development sessions which are open-to-all to attend and participate. Missed the Lecture Meeting, but still interested in viewing the entire meeting video

Visit the below link or scan the QR code with your phone scanner app:

Link – https://www.youtube.com/watch?v=b37oq9oCgTQ

26TH INTERNATIONAL TAX & FINANCE CONFERENCE

The 26th International tax & Finance Conference was held at the Ananta Hotels and Resorts, Udaipur, India’s City of Lakes, from 4th – 7th August, 2022.

The conference was attended by 236 participants, including 9 non-residents and 30 online participants. It began with the traditional lighting of the lamp and blessings by Goddess Saraswati in an endeavour to learn new things.

The conference had one paper for presentation and three papers for group discussion papers. All four paper writers, namely CA Geeta Jani, CA Girish Vanvari, CA Himanshu Parekh and CA Padamchan Khinch respectively provided well-researched papers on the subjects BEPS 2.0 – Globe Rules and Pillar 2 – Case Studies, Cross Border Mergers, Demergers & Restructuring – Tax & Regulatory Aspects, Select Controversies/ Emerging trends in International Taxation and Cross-border Employment Remuneration and Benefits. The sessions were ably chaired by Dr. CA Mayur Nayak, CA Sushil Lakhani, CA Gautam Nayak & CA Kishor Karia.

This time three-panel discussions by panels consisting of distinguished panellists were conducted as follows-

1.    Panel discussions on Cross Border Swift Payment Mechanism and its Importance, Rupee Ruble Payment System, Digital Currency and its future by a panel consisting of Shri Gopalaraman Padmanabhan, Shri Mahalingam Gurumoorthy, and Shri Ananth Narayan and ably chaired by CA. Dilip Thakkar and Moderated by CA. Sunil Kothare. This Panel was in a hybrid mode, whereby the entire Panel was online whereas the participants were at the venue of the ITF Conference.

2.    Panel discussions to deal with intricate issues in the field of international taxation in the form of Case Studies in International Taxation consisting of CA Pranav Sayta (Chairman cum Moderator), Hon’ble ITAT Member Shri Amit Shukla, Sr. Adv. Shri Ajay Vohra and Shri Sanjeev Sharma, Principal Director of Income Tax (Investigation).

3.    The third eminent and well-distinguished panel on the subject “Transfer Pricing – Global Developments” consisting of CA T P Ostwal (Chairman cum Moderator), CA Karishma Phatarphekar, CA Bhavesh Dedhia and CA Vijay Iyer dealt with issues arising on account of due to Covid 2019 & Russia- Ukraine War.

A significant contribution to the success of this conference was made by Dr. CA Mayur Nayak, Immediate Past Chairman, CA Nitin Singala, Chairman, CA Chetan Shah, Co-Chairman, CA Jagat Mehta, CA Rutvik Sanghvi, CA Siddharth Banwat, CA Mahesh Nayak, CA Tarunkumar Singhal, CA Anil Doshi, Deepak Kanabar, CA Durga Shaankar Sharmaji, CA Chaitanya, CA Naman Srimal. CA Kishor Pahuja helped with local coordination, arrangement for the entertainment programme and a visit to Nathdwara.

Society News

MEETING ON OVERSEAS INVESTMENTS IN INDIA
The Suburban Study Circle organized a meeting on the topic ‘Recent Amendments to Overseas Investment Regime in India’ on 15th October, 2022. CA Hardik Mehta made an insightful presentation and shared his views on the following topics:

  • Enhanced clarity with respect to various definitions and routes for Overseas Investment.

  • Introduction of the concept of ‘Strategic Sector’ and ‘Bonafide Business Activity’.

  • Insights on further development in Round-tripping of Investments.

  • Understanding of issuance of corporate guarantees to or on behalf of second or subsequent level step-down subsidiary (SDS) and deferred payment of consideration.

  • Important changes in reporting requirements.

  • Introduction of “Late Submission Fee (LSF)” for reporting delays.

  • Other important amendments with relevant Posers/ Observations.

STUDY CIRCLE MEETING ON SECTION 194R
The HRD Committee Study Circle organized a meeting on the topic ‘Section 194 R – A 360-degree Perspective’ on 14th October, 2022. The session was led by CA Jhankhana Thakkar, who briefly took the members through the provisions of section 194R of the Income-tax Act, 1961 and two Circulars issued by the Central Board of Direct Taxes. She also took up some practical live case studies wherein she discussed the pros and cons of the applicability of section 194R. She also discussed applicability of section 194R to a commonly found situation i.e., where an employee of one Group company is deputed to another Group Company.


STUDY CIRCLE MEETING ON ‘LAW OF ATTRACTION’
The Human Resources Development Committee organized a HRD Study Circle meeting on ‘Law of Attraction’ at the BCAS office, Mumbai. The meeting was held in a hybrid form on 13th September, 2022. At the meeting, CA Vinod Jain and CA Preeti Cherian, shared learnings from the Leadership Camp held on 30th June 2022 and 1st July 2022. The speakers provided key takeaways of the workshop and the difference these practices have made to their lives.

YouTube Link:
https://www.youtube.com/watch?v=Er-cNiXDM48

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WORKSHOP ON AUDIT OF SMALL & MEDIUM ENTERPRISES
In order to help members and their clients, the Accounting and Auditing Committee of the BCAS scheduled a comprehensive and interesting ‘360-degree online workshop’ spread over eight sessions over four days from 3rd, 7th, 8th and 10th September, 2022 on various important aspects dealing with audit of private limited companies and non-company entities (MSMEs). The workshop aimed at improving the overall quality of audit, avoid pitfalls and creating awareness of updated financial reporting framework, changed reporting and disclosure environment. The sessions were designed to be case study based and keeping in mind the practical challenges faced during audits. This all-round workshop was aimed at aiding the small and medium practitioner to sharpen their skills and update knowledge thus improving the overall quality of work and also help firms to prepare for peer review readiness and SQC compliance.

The workshop was designed specifically to cover practical aspects related to Standards on Auditng, Accounting Standards, CARO 2020, Amended Schedule III, provisions of Companies Act, Audit reporting etc.

Most of the speakers for this workshop were invited from the Accounting and Auditing Committee.


MEETING ON BENEFITS OF HOMOEOPATHY
The HRD Committee study circle organized an online meeting on 23rd June, 2022 at the BCAS office. The meeting focused on the topic ‘Magic and Fundamentals of Homeopathy’. It was presented by CA Rajneesh Agarwal, a well-known professional, with deep interest in homoeopathy for over 25 years. He recently published a complimentary book “Homoeopathy: A Miracle of Nature” and has founded an organization “Kewal Samarpan Foundation”. His book is currently in English, Hindi and Bengali and can be downloaded from www.kewalsamarpan.com.

He has also made a home kit of 21 common homoeopathic medicines, with which the common man can cure numerous day-to-day ailments on one’s own at virtually no cost. He explained these 21 medicines and several ailments that can be easily cured by them.

At the meeting, he explained how Homoeopathy became his hobby and it helped him permanently cure his lifelong sinusitis, psoriasis, piles, etc. and how he has helped many people with magical results for strange afflictions.

He also explained how the molecular memory of natural substances is captured in alcohol, filtered, diluted and how these touch our energy, create waves in our energy field and result in activating our immunity and the disease being eliminated at the root.

YouTube Link:
https://www.youtube.com/watch?v=-wPnF95Q-uM

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LEADERSHIP WORKSHOP BY HRD COMMITTEE
The HRD Committee of the BCAS organised a five-hour leadership workshop entitled ‘Power of Attraction’ on 30th June and 1st July, 2022, in the virtual mode. The coach, Naz Chougley covered the extremely pertinent topics including how to manifest our dreams and aspirations and how to awaken the power to create reality through our thoughts.

The coach guided the participants on the need to align with the Source (the highest version of ourselves), regain our worthiness, and feel unconditional love, deep acceptance and forgiveness for self. She dwelled on the importance of practicing gratitude and present moment awareness, leading a life of humility, releasing emotional blockages to heal both self and personal relationships.

Chougley spoke of how our habit of thinking is broadcast to the Universe – very often, we are habituated to create the ‘worst case scenario’ in our minds – this thought is captured by the Universe and is then manifested. Universe is a vibe of fun and joy, acceptance and awareness, and we need to consciously think of what is it that we want and invest time in this. We need to be aware of the frequency we are on – if we make it serious, that is how life will be. We are separate from our mind, and we need to question our beliefs, come out of our conditioning, and rewire our thinking.

She interspersed her talk with several real-life examples that her clients and she herself had experienced, and shared certain practices with the participants on how to maintain the positive vibration – (1) Five pills of gratitude every day thrice a day (2) Intention Tapping (3) Being in the present moment (4) Practicing emotional release.


MEETINGS ON OVERSEAS INVESTMENT RULES
The FEMA Study Circle organized three study circle meetings to take up the recently announced Overseas Investment Rules for detailed study and discussion. The first meeting, led by CA Hardik Mehta and CA Naisar Shah, focused on definitions and main concepts in the rules. The schedules to the Rules and important regulations as also the amendment made in the LRS Directions were taken up during the next two meetings by CA Harshal Bhuta and CA Sneh Bhuta. The group leaders brought out several nuances and issues by way of posers and case studies over these three meetings and those were deliberated upon by members of the Study Circle including Seniors in the profession.

MEETING ON TEACHINGS OF SAINT KABEER
The HRD Committee organized a Study Circle meeting to discuss the topic ‘Kabeer’s thoughts in 21st century: Relevance to our day to day life’ which was presented by Dr Hubnath Pandey, on 9th August, 2022 at BCAS office. The meeting was held in a hybrid format.

YouTube Link:
https://www.youtube.com/watch?v=5JrFb110vt0

QR code:
 

 
SESSION ON DATA, CLOUDS AND NETWORK
The Technology Initiative Committee organized a session on ‘Data, Clouds, and Network – Best Practices’ on 2nd July, 2022 in hybrid mode at the BCAS Bhavan.

The session was conducted by Mr. Deepak Jhaveri who has over 35 years of experience in advising clients in Information Technology (IT) infrastructure and security The session covered the following topics:

IT Security Awareness, Audit, External threats, and internal threats: The statistic of cyber-attacks and financial loss suffered by the organization was shared, and a quiz was conducted to identify fake website from the original one.

Self-Defence and Organization Defence: Areas of focus for defence from a technological perspective were discussed in detail. The speaker emphasized taking preventive measures while setting passwords, setting up a personal firewall or Wi-Fi, while navigating to social sites and using mobile devices in public places. He also explained about the alternative authentication methods.

IT Security Audit and Advisory Practice: The speaker covered the scope of IT security audit and advisory services and the growing market for such services.

Best Practices for Tools, Solutions, Cloud everywhere, Mobile Monsters: Best practices for using technology to ensure that it is not vulnerable to cyber-attacks and data leakages were discussed in detail. The speaker also presented a snapshot of various security products and applications relevant to address concerns of business.

Society News

LECTURE MEETING ON SPIRITUALITY IN PROFESSIONAL LIFE
On 12th July 2022, BCAS organised a hybrid lecture meeting on “Spirituality in Professional Life (for inner peace, self-sufficiency & abundance)” by Swami Swatmananda.

Key takeaways

What is Spirituality?
•    Not a way to look at certain things. It is a certain way to look at all things.
•    It is a Vision and not just Actions.

What kind of Vision is required to attain spirituality?
•    Vision of holistic growth and transformation through the mind and life management.

What is Success?
“Success is a tribute that life pays to excellence.” – Swami Chinmayanand

The formula for success is S-S = S+S. Here, S-S stands for Success without stress, and S+S stands for Skill and Strength.

To explain to the audience: How to invoke strength and spiritual knowledge, Swamiji used the Acronym “HIGHER”

[H]igh vision requires high inspiration.

•    A person who has a high vision and goal is likely to be highly inspired.
•    A perfect alignment of the three elements (body, mind & intellect) gives Result + Happiness. Their non-alignment results in emptiness.

[I]n-line with Swadharma and [I]n-line with Dharma: Helps us with inner Strength, Goodwill, and peace & harmony.

•    Swadharma
o    Inner peace and inner satisfaction should be prioritized.
o    Do what you love, love what you do.

•    Dharma
o    Dharma refers to Duty, Righteousness, Value, and Ethics.
o    Aspects of Dharma include Integrity, Honesty, and Prompt Execution.
o    Success should be dharmic and not with Adharma.

 [G]reater Fortitude

•    Higher the Goal, the greater will be the obstacles. Never lose hope and faith. Never give up.
•    Swamiji also explained the connection between yagna and teamwork.

o    Both yagna and team have the purpose of coming together for a greater cause and co-operative endeavour; contributing their best and its results benefit everyone.

o    Neither dependence nor independence but inter-dependence.
[H]igher Team

o    Swamiji explained the importance of results achieved with the consistent team work.

o    He asked the audience, What is family? Like wise, at work place also results are achieved through quality team work.

Working in silos would not yield any result.

[E]xcellence and [E]xpertise

Excellence + Expertise = Effectiveness

•    Where Excellence comes from Awareness and Expertise comes from Knowledge.
•    Effectiveness is the result of the application of Awareness and Knowledge.
•    Excellence comes from paying full attention to your work (3 hours of multitasking = 1 hour of focus).

 [R]esult

•    “Karma kiye jaa fal ki chinta mat kar” – Do best, leave rest.

Swamiji also discussed the importance of ‘mental health’ and explained how to conserve mental energy. The best way to live life is to have no regrets of the past and no anxiety about the future. Methods to keep up the mental strength: deep breathing, solving logical puzzles, counting backwards (like 50 to 1), do not ask ‘why’ ask ‘how’ and meditate.

Swamiji answered all the questions raised by the participants present physically as well as raised on the chat and Q&A box.

BCAS Lecture Meetings are high-quality professional development sessions which are open-to-all to attend and participate. Missed the Lecture Meeting, but still interested in viewing the entire meeting video?

Visit the below link OR scan the below QR code with your phone camera:

Link : https://www.youtube.com/watch?v=FF9Qz9i9OzI


 

SEMINAR ON TAX AUDIT REPORTING

With numerous changes and nuances relating to Tax Audit, the Taxation Committee of the society organised a seminar on Intricate Issues relating to Tax Audit Reporting on 19th August, 2022, in hybrid mode. The seminar comprised of three sessions and was conducted in-person at BCAS office and simultaneous through the BCAS online hybrid learning platform.

CA Paresh Clerk explained the importance of documentation, various audit techniques and quality control while carrying out a tax audit. He also touched upon the various clauses of Form 3CD and explained the applicability of Form 3CA-3CB. He also replied to various queries raised by online and offline participants.

In the second session, CA Rutvik Sanghvi addressed the issue of reporting of Foreign Income and claiming foreign tax credits and filing various other important forms. He explained the reporting mechanism along with applicable rules in a very lucid manner. He shared his practical insights on a few issues faced by the participants.

In the last session, CA Vallabh Gokhale touched upon all the important clauses in the Form 3CD, including two new clauses relating to GAAR and GST applicable from F.Y. 2021-22. He explained both the new clauses in detail with various examples and gave his views on the likely issues which most of the assesses would face while filling up the said clauses.


BLOOD DONATION CAMP & DISCOUNTED HEALTH CAMP
As part of the Azadi ka Amrit Mahotsav celebrations, the BCAS Foundation, along with the SPR&MD Committee, organised a ‘Blood Donation Camp & Discounted Health Check-up Camp’ on 20th August 2022, at the Brahmakumaris’ GHRC BSES M G Hospital.

In the past, all such camps have been held at the BCAS office, and this was the first out-of-the-office venture specially targeted towards the Society members located in the western suburbs. The medical team at the hospital was ably led by Dr. Madhura Patkar, Medical Administrator. The hospital also made available attractive Discounted Check-Up Plans, and the opportunity to meet and seek medical advice from a wide range of consultants at an extremely nominal price, to the members, their families, and friends.

The spiritual culture that is deeply ingrained in the DNA of the hospital made the interaction a truly memorable experience.

WORKSHOP ON PROCESS AUTOMATION UNDER GST

The Indirect Taxation Committee of BCAS organised a half-day Workshop on Process Automation under GST on 10th September 2022, at Jolly Bhavan. The speakers were CA Jigar Doshi and CA Yash Goenka.

The workshop was directed at how to reduce the time involved in preparing GST Returns and other related compliances using Robotic Process Automation (RPA), a business process automation technology based on metaphorical software robots (bots) or on artificial intelligence.

Both the speakers took the participants through the entire process of preparing Macros and preparing a BoT by giving a live demo. They explained how the RPA tools allow data to be handled in and between multiple applications, for instance, receiving an email containing an invoice, extracting the data, and then typing that into a bookkeeping system. Their presentation covered Enterprise Modernization, developing a Macro, benefits of RPA solutions and using the same in resolving the problem statements in GST, live designing and development of a BOT together with preparation of Business Requirement Document (BRD) and User Requirement Specification (URS) including preparing a Flowchart enabling decision making in RPA.

Considering requests from members, the recording of the same will be put on Course Play for the benefit of those who could not attend. They can subscribe for the same and watch it at their convenience.

The workshop was very well received, and the participants requested a more detailed workshop on the same topic. Considering the same, the Committee has organized on similar workshop on the same with hands-on practical training on 19th November 2022.


FELICITATION OF YOUNG CAs OF MAY 2022 EXAMINATION
A special event was organised for the freshly qualified Chartered Accountants of the May 2022 final examination on 10th September 2022, at the BCAS Hall under the aegis of the Seminar, Public Relations & Membership Development (SPR&MD) Committee.

The evening started with Convenor, CA Preeti Cherian, welcoming all the participants by acknowledging the fantastic performance of Mumbai finalists, and the presence of 14 rank holders in the house (including AIR 1 and AIR 4). This was followed by the address of the President, CA Mihir Sheth, who took the opportunity to reminisce about his days as a young Chartered Accountant, the sound advice he had received to associate with BCAS, and the benefits he had reaped from that. He briefed the audience on the various initiatives of the Society and invited them to be part of this vibrant organisation. Vice President, CA Chirag Doshi, addressed the audience and encouraged them to try new avenues and identify themselves with a mentor who would be able to guide them.

In his address, the Chairman of the SPR&MD Committee, CA Narayan Pasari, praised the Youth or Yuva Shakti, which forms an integral part of the numerous activities organised by the BCAS. He also appealed to the new CAs to become members and play an active role. While speaking about the Committee’s initiatives, he dwelled on the BCAS Referencer, Annual RRC, Mentor-Mentee Program, etc. He shared that the Season 2 announcement for the Mentor-Mentee Program (scheduled for Nov/ Dec 2022) would soon be rolled out and invited the participants to register at the earliest given the minimum available seats.

This was followed by the Fireside Chat with the three eminent speakers. CA Jayant Gokhale shared his three principles – (1) Understand and analyse the problem; (2) Be confident – do not fear failure and seek guidance from the right mentors; (3) Have empathy and understanding for your client. He advised the young hopefuls to allow themselves a year or two to explore and try out different things so that they could identify what is it that they would like to do. He suggested that they prepare a list of priorities and follow their passion.

CA Anand Bathiya shared his insights on critical choices between practice vs. employment, boutique vs. big firms, specialization vs. versatility and related quandary. Talking on secondary courses post-qualification, he emphasised on developing skillsets surrounding emerging technologies to build a tech edge. He also spoke on nuances of setting up a new practice and methodical approach towards practice management that can be followed.

CA Mudit Yadav gave the audience a refreshing perspective on the word ‘confusion’ – he reminded the audience that confusion is a privilege they enjoy because they have the resources, power and freedom (having passed one of the toughest exams in the world). Look at the first job as an experiment. If someone is working with a corporate and is wondering whether the practice is their calling, they may consider offering their weekends to a CA firm on a pro bono basis for six months to see for themselves.

This was then followed by the felicitation ceremony, with the 14 rankers being felicitated first and AIR 1, Meet Shah, and AIR 4, Akshat Jain, sharing their thoughts, followed by cake cutting by them. The rest of the achievers were also felicitated. The event showcased the vibrancy of the participants, many of whom showed great interest in signing up to be members of the BCAS.

The session is highly recommended for young professionals. Incase you missed it, but still interested in viewing the entire session video?

Visit the below link OR scan the below QR code with your phone camera:

Link : https://www.youtube.com/watch?v=bdubHfRWygw

 

IESG MEETING – FREAKONOMICS

The International Economics Study Group of BCAS held a meeting on Freakonomics on 14th September 2022. Freakonomics is a ground-breaking collaboration between Levitt and an award-winning author and journalist, Stephen J. Dubner.

Through forceful storytelling and wry insight, Freakonomics shows that economics is, at root, how people get what they want or need, especially when other people want or need the same thing. Freakonomics challenges how we think all over again, exploring the hidden side of everything. There are 3 main themes: (1) Incentives, the issue of how we react to rewards and punishments, (2) Information asymmetry, and what consequences arise from various gaps of knowledge and how we try to compensate for those, and (3) Causation vs. correlation and how we often try to explain things the wrong way.

CA Naushad Panjwani, Past President of BCAS, shared his thoughts on incidents such as playschools, parenting, real estate agents and elections. Authors have attempted to apply established principles of microeconomics to common phenomenon and from the additional spectrum of Philosophy and Spirituality. He also shared his thoughts with real life examples about how incentives work with doctors, lawyers, accountants, mechanics, real estate agents and correlation with crimes. He took to the participants through the partitions of India and Pakistan, Korea, Israel and Palestine, all of which had a correlation to economics. The last 1,000 years witnessed control through conquer, colonization, compete, and cartels, the future could be conflicts and collaboration.

Society News

DIRECT TAX LAWS STUDY CIRCLE MEETING ON ‘INTERPLAY BETWEEN INCOME-TAX ACT, 1961 AND INSOLVENCY AND BANKRUPTCY CODE, 2016’ ON 21ST JULY, 2022
The Group leader, CA Priyanka Jain, took the group through the objective and preamble of the Insolvency and Bankruptcy Code, 2016 (IBC). The interplay between the legal provisions under the Income-tax Act, 1961 and IBC was discussed in detail. Further, judicial precedents relating to the moratorium period, resolution plan and liquidation were discussed.

After that, the group leader discussed the open issues relating to section 56(2)(viib) of the Income Tax Act, 1961 and section 281.

LECTURE MEETING ON UNSEEN CONNECTION BETWEEN UKRAINE WAR & DIGITAL TAXATION
BCAS had organized a hybrid lecture meeting on “Unseen Connection between Ukraine War & Digital Taxation” by CA Rashmin Sanghvi.

The Managing Committee, along with the Economic Study Group, organized the event on 1st August, 2022.

Key takeaways of the talk:

1. USSR Afghan War & Reagan Plan

USSR Afghan War and Reagan Plan use others to achieve your targets without losing your soldiers. A combination of Economic War + Supply of weapons to enemy of enemy works.

Year

Events

1975

The USA is ruled by Think Tank on several
subjects.

By 1950, USSR emerged as superpower number
2 (the USA being no.1).  Europe was
facing the heat of World War, and other countries were still referred to as
British Colonies who just got Independent and were busy putting their home
affair in place.

1975

So, there was a cold war between USSR and
US from 1950 to 1975.  By 1975, the USA
understood they could not fight a war with an equal or almost equal
opponent.  Thereby, a military war of
fighting with the USSR was ruled out.

1979

USSR (Union of Soviet Socialist Republics)
was a landlocked country in 1975 with huge mineral resources.  USSR desired entry into the Indian Ocean to
grow its trade and global presence. 
So, they decided to invade Afghanistan (Geopolitics), followed by entry
into Iran and Pakistan.  From the
Indian Ocean, Russia can reach European and African Markets.

1979- 1985

By nature, Afghan people are patriotic and
fighters.  So, the Afghan people
implemented Guerilla warfare techniques to fight the Russian Invasion.  Afghanistan derived support from the USA
through arms, ammunition, and financial support.  Thereby, Afghan tribals began to fight
against USSR. 

For the USA to support Afghan, they needed
a land base for Helicopters; since the USA had strained relations with Iran,
they approached Pakistan, and all weapons and ammunitions flowed from the USA
through Pakistan into Afghanistan during 1983 – 1985. 

1983

US President Reagan: Russia cannot be
defeated politically or militarily. Hence, in 1983, he approved the plan for
Economic War on USSR.  The plan was
prepared by US Think Tank much before Reagan became President.

The USSR was a Socialist Economy, and the
prices of essential products remained the same since 1914.  As a result, Economics was an unknown subject
for Russians in power. 

Soon, the global economy was
Dollarized.  All international trade,
speculation, money lending, everything happens in dollars.  As a result, all the countries must hold
the Dollar as a reserve. The USA could borrow from the world because of  the Dollarization. But the USSR could not
borrow. This was the beginning of the Economic War, and USA started financing
the war in Afghanistan. The USA had enough reserves to fund the war till
1989.

During his tenure, Regan announced the Strategic
Defense Initiative (SDI), nicknamed the “Star Wars program”,
GPS and computer-guided missile defence system with nuclear warheads intended
to protect the United States
from attack.

1985

Mikhail Gorbachev became Prime Minister in
1985 and soon realized that USSR reserves were depleted; further, nobody
outside the US would hold Ruble. On the other hand, US Dollar was owned
across the world and was gaining power

1985

over Russian Ruble.

Further, USSR had made a large investment
in building a missile defence system.

Knowing that USSR was building a weapon to
counter
Star Wars missiles, the US developed the Anti-Missile Missile, which means a
missile will strike another missile in the air, and a nuclear warhead will
fall in the sea, and the land area of the home country is not destroyed and
damaged.

1989

So, USSR accepted defeat in Afghanistan and
withdrew its army.

Both USSR and USA realized that
researching, developing and manufacturing missiles is a costly affair, so
they entered into a treaty to stop manufacturing missiles. President Regan
ordered to ignore this treaty, and that the USA would continue its R&D on
the missile.

But, by then, these Star Wars – Arms Race
had Forced USSR into poverty

1991

USSR crisis begins and it withdrew its army
from East Europe.

USA, Britain, France, and Germany (Great
Four or G4) decided that they would not buy anything from USSR. On the other
hand, USSR was dependent on other countries for its daily essentials – milk,
bread, fish, etc. G4 announced they would sell to USSR only for cash. This
forced the USSR into insolvency.

1992

East European countries start declaring
independence.

USSR breaks into 15 countries – Armenia,
Azerbaijan, Belarus, Estonia, Georgia, Kazakhstan, Kyrgyzstan, Latvia,
Lithuania, Moldova, Tajikistan, Turkmenistan, Ukraine, Uzbekistan, and
Russia.

USA won the ECONOMIC WAR.

1991-1993

Boris Yeltsin became Prime Minister in 1991
with absolutely no knowledge of economics. G4 agreed to support Russia
provided it agreed to become a Capitalist Country. Once Yeltsin agreed to the
terms of G4, considering the dire situation at home, G4 backed out from
providing financial support.

 

Financial
Impact on Ruble

Year

Ruble per USD

Jan 1990

4

1992

100

1997

31,500

1998

31.5 (1000 Ruble were
converted into 1 Ruble)

Feb 2022

101

Jul 2022

57

This currency depreciation meant that the
USSR went insolvent.

The Afghan War led to the disintegration of the USSR, and now only USA was the superpower.

2. Digital Taxation

Base Erosion and Profit Shifting (BEPS) is formed so that the tax planning strategies used by multinational enterprises do not exploit gaps and mismatches in tax rules to avoid paying tax. It is said: that BEPS reports on Digital Taxation have been mainly drafted by US Digital Corporations. They are extremely complicated for the taxpayer to comply with and the tax officer to administer.

BEPS Group for Digital Taxation could not come to any conclusion from 2013 to 2019. Probably because the USA would not agree to any sharing of tax revenue. Finally, in 2019, the OECD Secretariat published the report bypassing BEPS Group.

3. Ukraine Russia War & US Plan

A hypothesis to ponder upon:

  • Is Ukraine the current camel being used by the USA to further damage Russia?
  • Is the fear of Russia used to keep Europe under NATO/US influence?

The USA has established Bio Laboratories in Ukraine, intending to use these weapons against Russia in case of War. These Laboratories were technically and functionally financed by the USA.

NATO’s invitation to neighbouring countries to join the group was a clear indication of irritation to Russia. When Russia declared war on Ukraine, Germany said they would not start an exclusive gas line built from Russia to Germany by the Russian Government. This was a major setback for Russia.

The response of Russia is a response to the Economic War against the US. Russia cut Gas supplies to Europe and insisted on payments in Ruble or gold. In this crisis, USA and EU cannot ride out the crisis by increasing the money supply and interest rates. People need gas and food, not illusions.

Crises in Europe

  • US attacked Iraq and imposed sanctions on Iran. Iran and Iraq were selling oil in Euro. The war led to a fall in oil sales from Iran/Iraq to Europe, leading to a weakening Dollar and a strengthening Euro. Yet, Europe joined the US in weapons/Economic wars against Iraq & Iran.

  • US used Ukraine to fight Russia, which reduced the energy supply to Europe. As a result, Europe is facing a severe recession.


4. Philosophy

Unilateralism = Ego + Greed + Desire to Rule & Exploit others

On a global macro level – Powerful nations/ companies and individuals will try some strategies to rule and exploit others.

Earlier, Europe ruled the world & exploited the world. Russia & China have also acted similarly. It is important for India to remain independent.

Youth, wealth, power and indiscretion any one of these can cause destruction. Abuse of power harms the victims. However, it harms the Abuser even more than the Victim.

CA Rashmin Sanghvi answered all the questions raised by the participants present physically as well as raised on the chat and Q&A box.

YouTube Link:
https://www.youtube.com/watch?v=WzSPjJawGK4

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REPORT ON THE MEETING OF THE HUMAN RESOURCE COMMITTEE
On 5th August, 2022, the Human Resource Committee of Bombay Chartered Accountants’ Society organized a talk by Shri Kaivalya Smart on The Life sketch of Shri Aurobindo. This was to commemorate the 150th Birth Anniversary of Shri Aurobindo coinciding with the 75th Anniversary of India’s Independence from British Rule. Important highlights of the presentation were:

Childhood and education

Shri Aurobindo was born in Calcutta on 15th August, 1872. In the early days, he studied in Darjeeling. In 1879, at the age of seven, his two elder brothers was taken to England for education and lived there for fourteen years. Brought up at first with an English family in Manchester, he joined St. Paul’s School in London in 1884 and in 1890 went with a senior classical scholarship to King’s College, Cambridge, where he studied for two years. In 1890, he also passed the open competition for the Indian Civil Service, but at the end of two years of probation failed to present himself at the riding examination and was disqualified from service.

In India

At that time, the Maharaja Gaekwad of Baroda was in London. Sri Aurobindo saw him, sought an appointment in the Baroda Service and left England for India, arriving there in February 1893.

Sri Aurobindo stayed for thirteen years, from 1893 to 1906, in the Baroda Service, first in the Revenue Department and in secretariat work for the Maharaja, and later on as Professor of English and, finally, as Vice-Principal in the Baroda College. He developed an interest in literary activities. The poetry, much later published from Pondicherry, was composed at Baroda.

At Baroda, he learnt India’s culture, Sanskrit and several modern Indian languages. He had command over many European languages. He spent his time in silent political activity since he was not granted public action due to his position at Baroda.

Political and public life

The outbreak of the agitation against the partition of Bengal in 1905 allowed him to give up the Baroda Service and join the political movement. He left Baroda in 1906 and went to Calcutta as Principal of the newly-founded Bengal National College.

The political action of Sri Aurobindo spanned eight years, from 1902 to 1910. During the first half of this period, he worked behind the scenes, preparing with other co-workers for the Swadeshi (Indian Sinn Fein) movement, and was part of the Indian National Congress. In 1906, Sri Aurobindo came to Bengal with this purpose and joined the New Party, which had been recently formed in the Congress. Sri Aurobindo persuaded its chiefs in Bengal to come forward publicly as an All-India party with a definite and challenging programme that changed the face of Indian politics in two years.

The newborn Nationalist party put forward Swaraj. Boycott of British and foreign goods and the fostering of Swadeshi industries to replace them, the boycott of British law courts, universities and colleges and the creation of a network of National colleges and schools, the formation of societies of young men to do the work of police and pursue a policy of passive resistance.

Sri Aurobindo founded the daily paper Bande Mataram, as an acting editor. The Bande Mataram continued till its abrupt winding up in 1908 when Sri Aurobindo was imprisoned.

Sri Aurobindo was prosecuted for sedition in 1907 and later acquitted. He was arrested in the Alipore Conspiracy. He published a weekly English paper, the Karmayogin, and a Bengali weekly, the Dharma. During his twelve months’ detention in the Alipore Jail, spent entirely in yoga practice, his inner spiritual was unfolding for an exclusive concentration. He had glimpses of divine intervention.

Pondicherry

In April 2010, he sailed to Pondicherry French colony in India, leaving Bengal. The spiritual work needed exclusive concentration of all his energies. Eventually, he cut off connection with politics, refused to accept the Presidentship of the National Congress and retired.

During his stay at Pondicherry from 1910 onward, he remained exclusively devoted to his spiritual work and sadhana.

In 1914, after four years of silent Yoga, he published a philosophical monthly, the Arya. His more important works, The Life Divine, The Synthesis of Yoga, Essays on the Gita, and The Isha Upanishad, appeared serially in the Arya. These works embodied much of the inner knowledge that had come to him in his yoga practice. These were concerned with the spirit and significance of Indian civilization and culture (The Foundations of Indian Culture), the true meaning of the Vedas (The Secret of the Veda), the progress of human Society (The Human Cycle), the nature and evolution of poetry (The Future Poetry) and the possibility of the unification of the human race (The Ideal of Human Unity). At this time, he had also begun to publish his poems written in England and those composed at Baroda. The Arya, after six and half years of uninterrupted publication, in 1921, stopped publication. Sri Aurobindo lived in retirement at Pondicherry with four or five disciples. Later on few more. The numbers grew so large that a community of sadhaks had to be inspired by the guidance of those who had left everything behind for a higher life. This was the foundation of the Sri Aurobindo Ashram.

Though, Sri Aurobindo began his practice of Yoga in 1904. He was initially gathering the essential elements of spiritual experience and a further quest for a more complete experience uniting and harmonising the two ends of existence, Spirit and Matter. Supramental Force for the transformation of mind and body. To realize has been the dynamic aim of Sri Aurobindo’s Yoga.

Sri Aurobindo left his body on 5th December, 1950.

The Mother carried on his work until 17th November, 1973.

SYNOPSIS OF LECTURE MEETING ON “UNILATERAL, BILATERAL AND MULTILATERAL SOLUTIONS FOR DIGITAL ECONOMY CHALLENGES

On 17th August, 2022, the Society organised a virtual lecture meeting on the topic “Unilateral, Bilateral and Multilateral solutions for digital economy challenges” by CA Radhakishan Rawal.

CA Rawal shares his deep knowledge on the subject through an engaging talk alongwith live polls on the digital platform.

The speaker explained that many business models today are running globally without any physical presence. Technology has moved too far, but the tax laws did not. So, the countries are facing challenges relating to the taxation of Digital Services without any physical presence. In relation to such digital services, he gave an overview of new tax laws already adopted alongwith proposed tax laws which may be implemented in the coming future. Below is the snapshot of his address:

Unilateral Solution – This is the trade agreement wherein one country imposes restrictions on another and is not reciprocated.

  • Twenty seven countries have enacted Digital Services Tax (“DST”) or similar measures.
  • Fifteen countries have announced or proposed similar tax policies.
  • Rates range from 1.5% to 7.5%.


Difficulties in Unilateral solution

  • Complexities related to interpretation, understanding, manner of new provisions. (e.g., Levy of Equalization Levy @2%).

  • Approach of Tax Authorities is not to give up on any revenue.

  • The biggest issue is the credit for taxes paid in the home country of e-commerce operator (i.e. the entity which is earning the income) and if this is seen as a levy outside of the tax treaty, then the home country does not have obligation to give treaty benefit, which may lead to double taxation.

  • Question over availability of Tax treaty benefit? (Section 90).

  • Unilateral measures are found to be discriminatory in nature.

Bilateral Solution – These kind of trade deals benefits both parties to maintain economic stability. It can be signed in various areas such as double taxation agreement, tariff, custom clearance etc. Both countries have extended their hands to have access to each other’s market.

U N Solution – Article 12B: Article 12B was implemented in record time. It has reduced the complexities involved in DSTs & tried to make it simple. It has introduced the term “automated digital services”. An option is available for the taxpayer to pay taxes either on “gross basis” or “net basis” and (30% of qualified profit., qualified profit means relevant revenue * profitability ratio).

Difficulties in Bilateral solution

  • It is not a consensus solution among multiple countries.
  • Absence of mechanism to quickly implement Article 12B in tax treaties.
  • There is need for UN MLI as like BEPS MLI to see the practical uses of Article 12B.
  • Lack of incentives for countries to sign the bilateral tax treaty.
  • Initiation of work by UN tax committee.


Multilateral Solution – Here, there exists three or more parties in a trade agreement. The main aim is to reduce the tariff to boost imports and exports. OECD has worked upon Pillar 1 as a solution to tax the digital economy.

Difficulties in Multilateral solution

  • Complex solution.
  • Challenge in Fair allocation of taxing rights.
  • Time consuming approach with many moving parts.
  • Political uncertainties.
  • Whether the USA will accept it? – Challenges in US Senate.
  • 2/3rd majority in Senate would be required to pass this law in US.

YouTube Link:
https://www.youtube.com/watch?v=DVuFRWOYajw

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SOCIETY NEWS

HUMAN RESOURCES DEVELOPMENT STUDY CIRCLE MEETING – “IMPORTANCE OF PRAYERS – SCIENTIFIC ASPECTS”
This meeting was presented by CA C N Vaze and Ms. Manasi Amdekar on Tuesday, 10th May, 2022 at Bombay Chartered Accountant Society, Mumbai-400020.

In our Indian culture, we are taught by our parents and ancestors to give God first place in our life.

This has led everyone to believe in regular prayer in addition to prayer in times of distress, disaster or some other discomfort during our life’s journey.

‘Prayer’ is an integral part of a common man’s life. Prayers are at different levels.

We pray to the King, to the Judge, to our Boss or Superiors, to our parents, to the people at large. We write ‘Prayers’ in any petition to the Court or Government Authority.

During the ensuing event, we discussed the meaning and importance of prayers in a spiritual or philosophical sense. It is a prayer to God, Almighty or Super-Power.

A Lot of research has gone into analysing the effect of prayers on our minds and lives.

Ms. Manasi Amdekar is a psychological counsellor. She explained the scientific aspect of the effect of prayers on our brains and minds.

Ms. Manasi Amdekar presented her study about prayers with the help of a PPT and enlightened us with many examples, applications, images of human brain scanned using ultrasound etc. According to her, prayers in the form of Stotras and Mantras are like coding systems and unique combinations of words put together to regulate the breathing patterns of an individual in a certain frequency while chanting them. This has helped people overcome stressful events, traumas and also heal the internal damage to the brain.

We instruct our minds to calm down, focus on the deity, be submissive and offer our utmost attention to the prayer or the words we chant. Prayers give us a sense of unity when offered in masses. It makes us believe in the positive side of everything, and a sense of confidence, that if “we pray for something together, then everything is possible to achieve”. It is also nonetheless a means of cultural and religious identity of an individual and a factor of identification with the members of the community, which surely increases the feeling of belongingness for an individual.

She also emphasized the importance of a regular practice of positive talk and positive psychology. She responded to the questions from participants after her talk. It was indeed a thought-provoking session.

9TH YRRC HELD ON SATURDAY, 21ST MAY, 2022 AT BCAS HALL

 

The 9th YRRC was held on 21st May 2022 in a hybrid mode. This year the event was open to all professionals.

The event was aimed at having different and unique topics and also networking activities and games. The topics were designed to cover technical, strategic and networking aspects.

The Opening Remarks were shared by CA Mihir Sheth, VP – BCAS and CA Anand Kothari, Convenor of the HRD Committee at BCAS. CA K K Jhunjhunwala – Co-Chairman of the HRD Committee had also graced the event. CA Naushad Panjwani mentored the event.

The sessions were taken by:

• Metaverse in a Professional’s Life – Ms. Filisha Shah

• Design Thinking – Dr. Guruprasad Rao

• Blue Ocean Strategy – Er. Sharad Ashani

• Panel Discussion – Dr. Radhakrishnan Pillai

The attendees had amazing feedback to share in person and also on social media. The session by Dr. Radhakrishnan Pillai was moderated by the youth team, which gave them the confidence to take up more such sessions in the future and encouraged the youth.

We had more than 10,000 interactions on Twitter, LinkedIn, Instagram and Facebook on our posts on YRRC. We had about five to eight new memberships at BCAS during and after the event of YRRC.

FEMA STUDY CIRCLE MEETING HELD ON SATURDAY, 28TH MAY, 2022.

CA (Dr.) Suresh Surana, RSM Astute Consulting India Private Limited, led the FEMA Study Circle of BCAS on the topic of Non-Resident Indians (NRI): Investment in India – Immovable Properties, Shares and Deposits on 28th May, 2022. He is widely acclaimed amongst professionals and corporate honchos alike.  

Mr. Surana started off by giving an overview of India’s inward remittances and the country-wise inward remittances from NRIs. Then, he delved into the basics of FEMA by explaining the definitions of NRI/OCI/PIO as well as explaining the difference between residency provisions under FEMA and The Income Tax Act, 1961. Having laid the foundation, he moved on to explaining complex topics like Permissible Bank Accounts, Investments in Immovable Properties, Shares/ Securities, Debt Instruments and Business Entities before wrapping it up by explaining the compliances required to be fulfilled upon a change in status from ‘Resident’ to ‘Non-Resident’. He explained the nuances of each of these topics in great detail and ensured that the participants understood the concepts very well by supporting them with case studies that were indeed very insightful and thought-provoking. Needless to say, the presentation was a reflection of his granular style of thinking and attention to detail.   

Mr. Surana kept the participants engaged by answering questions as and when they arose. His ability to answer questions from any corner, coupled with interesting questions based on real-life situations encountered by professionals, made the presentation very lively and interesting. The highlight of Mr. Surana’s presentation was a fine balance between the range of topics covered within such a short span of time without being too overwhelming and the attention to detail.

SUBURBAN STUDY CIRCLE MEETING

“Recent Amendments to Schedule III of Companies Act, 2013 & The Companies Rules And Companies (Auditor’s Report) Order, 2020” Part I on Saturday, 14th May, 2022 and Part II on Friday, 3rd June 2022 at Bathiya & Associates LLP, Andheri (E)

The Suburban Study Circle had organized a meeting on “Recent Amendments to Schedule III of Companies Act, 2013 & The Companies Rules And Companies (Auditor’s Report) Order, 2020” in two parts which was addressed by CA Amit Purohit as a Group Leader in both the sessions.

Group Leader CA Amit Purohit made an insightful presentation and shared his views on the following:

• Amendments to Schedule III to the Companies Act 2013 (Effective from 1st April, 2021)

• Amendments to The Companies (Audit and Auditors) Rules, 2014 (Effective from 1st April, 2021)

• Amendments to The Companies (Accounts) Rules, 2014 (Effective from 1st April, 2021)

• Amendments to Rules effective from 1st April, 2022

• Companies (Auditor’s Report) Order, 2020

• Guidance note by the ICAI

The participants benefited from the presentation shared by the group leader.

IESG MEETING ON 7TH JUNE, 2022 – INFLATION, FOOD CRISIS & SURGING DOLLAR

Summary of the meeting:
The group discussed the cause & effect of rising inflation globally & in India is creating issues for Governments, Central Banks & Poor people as Ukraine War & Chinese lockdown induced supply chain disruption pushes up prices for energy, industrial raw materials, food grains & essentials. While Central Banks have increased interest rates but elevated inflation is causing negative real interest rates creating problems for people dependent on interest income. Global GDP growth is also being downgraded by Institutions. Members expressed that this phenomenan is comparable to similar major events like WW II, 9/11 & Global Financial Crisis (2008-2009) when inflation had shot up but the same came down with steps taken by governments and base effect. The food crisis is worsening with supply disruptions due to war & sanctions. Experts are labeling this as “Weaponising food” as globally, we are experiencing food shortages and very high food prices threatening hunger crisis in many poor nations. India has taken steps to restrict exports of a few key items to enable fulfilling their Food Security obligations. American Dollar has surged to 20 year high with Euro nearing Dollar parity. This is also causing a problem of importing inflation in many countries as their currencies are getting adversely impacted.

Speaker: CA Harshad Shah presented points for deliberations, and many group members also expressed their views.

SOCIETY NEWS

INDIRECT TAX STUDY CIRCLE MEETINGS

1. ‘RECENT AMENDMENTS IN GST AND CASE LAWS’

The Indirect Tax Study Circle of BCAS organized its 7th meeting for 2021-22 on ‘Recent Amendments in GST and Case Laws’ on 8th February, 2022, addressed by group leader CA Parth Shah and mentored by CA Jayesh Gogri.

The group leader had made 9 case studies on recent changes in GST law that are effective 1st January, 2022, along with the Union Budget 2022 Amendment Proposals and specific advance rulings/ high court judgements. The presentation broadly covered the impact of amendments and changes on the following topics:

•    Proposed Amendments in Union Budget, 2022.

•    Errors in GSTR – 3B and recovery proceedings thereafter.

•    Reversal of credit and levy of interest thereon pursuant to retrospective amendment.

•    Recovery for ITC not reflected in GSTR-2A.

•    Issues in variation of more than 5% in ITC claimed as against ITC appearing in GSTR 2B, especially w.r.t amendments in sec 16(2).

•    Issues for cross charge. Is ISD an option, or would cross charge be considered as compliant as against
ISD?

•    Consignment interceptions and issues in clubs.

The participants took active part in all the case study discussions with the issues being discussed at length. Mentor, CA Jayesh Gogri provided his astute
comments on various aspects covering all the case studies.

73 participants benefitted from this active discussion, ably led by the group leader and Mentor.

2. ‘INTRICATE ISSUES IN ENTERTAINMENT AND HOSPITALITY SECTOR’

 
The next meeting (the 8th and last in F.Y. 2021-22 of the IDT Laws Study Circle of BCAS) was on ‘Intricate Issues in Entertainment and Hospitality Sector’ on 17th February, 2022, addressed by group leader CA Ramandeep Bhatia from Raipur, and mentored by CA Parimal Kulkarni from Panaji.

The online platform has given greater reach for pooling resource persons from all over India. Group leader CA Ramandeep Bhatia presented 7 case studies dwelling upon the intricacies and issues in the sector. The presentation and discussion broadly covered the intricacies of the following topics:

•    ITC issues in an Amusement Park w.r.t classification issues for equipments as immovable or not, land development, etc.

•    Rate and classification issues on entry fees for entertainment parks, etc.

•    Taxability of donations received from trusts for events organised for charitable activities.

•    Issues for restaurants, namely, standalone restaurants, eating joints, resellers, sales through E-com operators, cloud kitchens, liquor sales, etc.

•    COVID pandemic issues which either mandated or volunteered various actions and its post facto effects during assessments.

•    Issues for 5/3-Star Hotels, vis-a-vis ITC on various items and chargeability w.r.t conditions in rate notification.

The participants from all over India took an active part in the discussion on all the case studies, and the issues were discussed at length. The Mentor gave his astute comments on various aspects covered in the case studies.

Over 60 participants benefitted from the active discussion led by the group leader and Mentor.

SEMINAR – LLP: 360 DEGREES PERSPECTIVE (LEGAL, TAX, FEMA)

The Taxation Committee of BCAS organised a half day event ‘Seminar on LLP – 360 degrees perspective (Legal, Tax, FEMA)’ on 1st April, 2022 in hybrid mode (physical meeting at BCAS office and virtually on Zoom). The opening remarks were given by the President, CA Abhay Mehta, followed by an introduction to the subject by CA Anil Sathe, Co-Chairman, Taxation Committee. The seminar was divided into three sessions:

i. CS Makarand Joshi commenced with the origins of LLP regulations and provided a brief overview of the key features of an LLP and its formation process. He drew attention to crucial pointers that everyone should consider while drafting an LLP agreement. Thereafter, he commented upon the important compliances to be followed by every LLP and its Designated Partners.

ii. CA Vishal Gada commenced with the distinguishing points between an LLP and a Company. He briefly introduced the basic provisions of the Income Tax Act applicable to LLPs. Thereafter, he educated the participants about the tax implications on account of reconstitution of an LLP along with practical case studies, tax implications on account of merger / demerger of LLP, implications on account of transfer of partners’ rights in LLP, conversion of company into LLP and FEMA regulations applicable to LLPs (including inbound and outbound investment regulations).

iii. CA Udayan Choksi emphasized the definitions of certain important terms under the GST laws and gave a brief overview of the GST provisions covering the taxability, classification, valuation, credits, compliance and departmental actions. He explained various provisions with the help of practical case studies.

The seminar covered a gamut of tax and regulatory regulations applicable to an LLP. It was a highly informative seminar covering 360 degree perspectives (Legal, GST, taxation) for an LLP. The speakers answered the queries raised by participants, reflecting their wide experience and expertise on the subject matter.

STUDY CIRCLE MEETING – ‘MASTER YOUR MIND MASTER YOUR LIFE’
The HRD Committee of BCAS conducted a study circle meeting on the topic ‘Master Your Mind Master Your Life’ on 12th April, 2022. The session was presented by CA Khushbu Shah.

“There is no greater blessing than being the Master of your Mind, and blessed are those who are on the Journey of Mastering their Mind”

We tend to believe mastering the mind is difficult because of the past baggage it carries and the external stimulus it receives every day. But in reality, mastering your mind is extremely easy and achievable. LIFE is all about *L*ooking *I*nternal & *F*orward *E*xternal. Your Life is a reflection of your inner thoughts, and your mind, in reality, is the power button of your life. This session laid down the red carpet for all the ‘Open Minds’ to embark on the ‘Journey of Mastering their Minds’!

The session started with a very powerful and positive meditation conducted by the speaker, engaging the entire audience, and expressing gratitude towards everyone who understood the importance of ‘Mastering the Minds’ and took the first step towards it and joined the session.

The discussion paved its way through the millions of thoughts that we have as people every single day to how we, as human beings can Develop, Understand and Practice the profound ways of ‘Mastering the Mind’. With numerous heart touching, relatable and meaningful short stories, understanding each concept was extremely relatable and convincing.

Different levels of mind and how they operate under each situation were explained with various real-life examples to understand the impact of each stage of mind and how the thoughts and the food one intakes determine the well-being of a person.

 “What you Consume, Consumes You;
What Consumes you Controls Your Life!”

To ensure you move towards the right way of thinking, almost 15 different Powerful Mind Hacks which should be practiced and the impact that each one can create were discussed in detail.

The speaker, summed up with a very simple yet powerful example, referring to the mind as a traffic signal, having a significant impact, and when followed correctly can lead to a smooth journey on the road of Life-

Red Signal – Stop the Waste Thoughts

Yellow Signal – Slow Down the Fast Thoughts

Green Signal – Go towards the Right Thoughts

A Mastered Mind is always a Happy Mind, and Happy Minds have the power to make their Life worthwhile.

MEETING – “RECENT AMENDMENTS IN INCOME-TAX ACT, 1961”
The Suburban Study Circle organised a meeting on ‘Recent Amendments in Income-Tax Act, 1961’ on Friday, 22nd April, 2022 at Bathiya & Associates LLP, Andheri (E), which was addressed by CA Chintan Jitendra Shah as a Group Leader and Mr. Piyush Chhajed as session Chairman.

Group Leader CA Chintan Shah made an insightful presentation and shared his views on the following:

• Discussion on Virtual Digital Assets and its Tax Impact

• Updated Return applicability

• New definitions on ‘Succession’ and ‘Business Re-organisation’

• Retrospective amendment

• Avoidance of Repetitive Appeal Provisions

• Amendment in provisions relating to Charitable Trusts

• Assessment time limits and many more amendments

• New amendments in the Act which were not part of the proposed Bill.

The session was practical and all the points were very well covered and discussed with the group. CA Piyush Chhhajed’s command of the subject and his depth of knowledge was well appreciated by the group.

The participants benefited from the presentation shared by the group leader.

STUDY CIRCLE MEETING – ‘TAXATION OF EMPLOYEE STOCK OPTION PLANS (ESOPS)’
The Direct Tax Laws Study Circle Meeting held a session on ‘Taxation of Employee Stock Option Plans (ESOPs)’ on 25th April 2022.

The Group leader, CA Darshak Shah, provided an overview of various ESOP types, and the process adopted in their issuance. The disclosure requirements for companies and employees were discussed in depth with references to judicial precedents and relevant rules. Further, multi residency taxation provided in OECD articles with relevant case studies was discussed.

Thereafter, the group leader discussed in detail the taxation on allotment of shares in the hands of employees, taxation of Stock Appreciation Rights (SARs) under cash settlement or equity settlement and the taxation of Phantom Stocks. The session ended with a vote of thanks.

IESG MEETING – THREATS TO PETRODOLLAR & US DOLLAR’S STATUS AS “RESERVE CURRENCY”, ARE WE HEADING FOR CHANGE OF WORLD ORDER OR MULTIPOLAR GLOBAL ORDER?

The IESG held a meeting on the above subject on 26th April, 2022.

Petrodollar system has been put in place since 1973. A natural relationship was formed between Saudi Arabia and the U.S., where the former would sell its oil in exchange for the dollars earned to be reinvested into the US Treasury Market in return for security promise to protect Saudi Royals. Many Middle East & OPEC countries joined. Countries that buy oil would need to buy dollars first. This consistent demand for the dollar is one of the reasons why it has maintained its reserve status. But if the bigger players decide to use another method of payment, then the system is at risk of breaking down. Wars have been fought to keep this system in place or dissuade any member from trying to break away. US’s economic dominance was built on the petrodollar. This helped US run its massive trade deficits (since 1975, America has never run a trade surplus) without worry of their dollar demand declining. Those who opposed Petro-Dollar perished, like Saddam, Gaddafi, Iran, Venezuela, etc. Post Russia’s invasion of Ukraine and USA’s sanctions against Russia, Russia has put conditions on Europe (which has major dependence on Russia for Oil and Gas), that they will supply Gas and Oil only in Roubles and the Roubles is now linked to Gold. There are other bilateral arrangements like China with Iran, Russia with Saudi Arabia and Russia with India, threatening the relevance of Petrodollar.

There has been continuous process of de-dollarisation which means substituting own currencies in place of US dollar for all transactions. We are witnessing the beginning of de-dollarisation due to increased geopolitical risk from sanctions and debarring from SWIFT platform for settlement. USA’s massive spending on wars and pandemic relief stimuli have resulted in US’s debt soaring to $ 30 trillion (134% of Debt to GDP) and the American economy is facing serious challenges like inflation at a 41-year high, higher interest rates, wage stagnation, soaring cost of living, higher product prices etc. threatening US Dollar’s status as a Reserve Currency. Moreover, aggressive use of sanctions also threatens dollar hegemony which could eventually undermine USA’s status as a World Super Power. Many credible institutions like IMF, Goldman Sachs and others have expressed concerns in this regards. Historically, status of Reserve Currency and hegemony remains for 70-100 years. Are we looking at a multipolar world? What will be the position of India in this fast changing geopolitical situation?

The speaker CA Harshad Shah presented points for deliberations, and many group members also expressed their views.

INDIRECT TAX STUDY CIRCLE MEETING ON 29TH APRIL, 2022 THROUGH ZOOM ONLINE MEETING
The Indirect Tax Study Circle of the BCAS organised its 1st meeting for 2022-23 to discuss key aspects relating to:

1. Payment of Pre-Deposits in GST Appeals

2. Merchant Trade – Supply of Goods outside India from a Place outside India.

The meeting held on 29th April, 2022 was addressed by group leader CA. Rushil Shah and mentored by CA. Sushil Solanki.

The group leader had made 6 case studies on practical challenges for payment of Pre-Deposits and Merchant Trade transactions. An active and healthy discussion included nitty-gritty in the subject covering:

• Issues in interpretation in the backdrop of Orissa High Court Judgement.

• Pre-Deposit payments and utilisation of credit ledger for GST appeals, erstwhile service tax appeals.

• Refund of Pre-Deposit paid in Service Tax Regime, whether allowed through Cash Ledger or Credit Ledger.

• Issues in Entry 7 of Schedule III to CGST Act w.r.t Merchant Trade, vis-à-vis its applicability, effective date – whether prospective or retrospective, issues in ITC, interpretation of section 17(3) and its limited purpose.

The participants were involved in threadbare analysis and discussion on all the case studies, and the issues were discussed at length. Mentor CA Sushil Solanki, and ex-IRS officer gave his fair comments on the legal interpretation of the law.

Around 76 participants benefitted from the active discussion led by the group leader and Mentor.

SEMINAR – TAXATION OF VIRTUAL DIGITAL ASSET (POPULARLY REFERRED TO AS CRYPTO CURRENCY)
The Taxation Committee of the Society organised a half-day webinar on ‘Taxation of Virtual Digital Asset (popularly referred to as Crypto Currency)’ on 6th May, 2022. The opening remarks were given by the President, Mr. Abhay Mehta, followed by an introduction to the subject by Mr. Anil Sathe, Co-Chairman, Taxation Committee. The webinar was divided into three sessions:

1. Adv. Meyyappan Nagappan gave an introduction to the concept of ‘Virtual Digital Asset’ (VDA) , more popularly known as ‘Cryptocurrency’ and gave an overview of how blockchain and cryptocurrencies have evolved over the years. He educated about basis of blockchain technology and the fundamentals of an NFT token and acceptability.

2. Adv. Bharat Raichandani highlighted the various provisions under GST regulations which need to be considered while determining the applicability of GST on VDA transactions.

3. CA Pradip Kapasi commented upon the taxability of VDA transfers prior to 1st April, 2021 and thereafter explained the new provisions pertaining to transfers of VDA, which have been introduced by Finance Act, 2022. He explained various provisions relating to TDS while making payments for VDA, provisions pertaining to set-off of losses arising on account of VDA transfers etc.

It was a highly informative session which covered 360 degree perspectives (Legal, GST, Taxation) on transactions relating to purchase and sale of VDA. Being a topic which is relatively in its nascent stage, the speakers educated the participants about the provisions in the most lucid possible manner and also highlighted the possible practical difficulties which one may face in the coming times. The speakers handled the queries raised by the participants with great panache, reflecting their in-depth knowledge and subject matter expertise.

“DISCUSSION ON KEY ASPECTS OF MAHARASHTRA SETTLEMENT OF ARREARS OF TAX, INTEREST, PENALTY OR LATE FEE ACT, 2022”
The Indirect Taxes Law Study Circle of BCAS organised its 2nd meeting for 2022-23 on “Discussion on key aspects of Maharashtra Settlement of Arrears of Tax, Interest, Penalty or Late Fee Act, 2022” on 14th May, 2022 which was addressed by group leader CA. Krunal Davda and mentored by CA. Rajat Talati.

The group leader had made 9 case studies for understanding the newly introduced Amnesty Scheme in the Maharashtra State Budget, 2022, as well as the calculation aspects of the same. He gave a detailed overview about the amnesty provisions as well as procedural aspects related to various pre-GST era laws governed by the MahaVAT Department, which were subsumed in GST. A participative discussion covered various practical aspects of the scheme, such as:

•    Practical calculations of Disputed and Undisputed tax. Calculation of Interest on the overall tax.

•    Issues in post-assessment interest which shall be fully waived. Reference to Trade Circular example to bring a clarity to settle.

•    Whether the scheme is qua order or qua financial year?

•    Calculation of Proportionate Waiver Benefits.

•    Issues if the pending assessments are not yet completed.

•    Taxes recommended by the auditor and accepted by the assessee, discussion on constitutional aspects on differentiating between the dealers.

•    Legality issues for separate orders for tax and interest and penalty.

•    Issues in other acts like the Entry Tax Act, BST, along with reference to MVAT.

The participants were involved in threadbare analysis and discussion on all the case studies, and the issues were discussed in detail to arrive at its conclusive interpretation. There were quite a few points which need representation to the Department to avoid contrary views being taken by the officers because of the Trade Circular issued and which may defeat the purpose of the scheme.

Around 40 participants benefitted from the informative discussion led by the group leader and Mentor.

STUDY COURSE – FOREIGN EXCHANGE MANAGEMENT ACT (FEMA)
FEMA was introduced with a view to monitoring dealings in foreign exchange/ securities and transactions affecting import and export of our currency. FEMA has evolved over the years, and knowledge of this topic has become a crucial factor in advising clients on implementing successful strategies for cross-border transactions in light of India’s positioning in the global arena.

The International Taxation Committee of BCAS organised a 4-day FEMA Study Course over two weekends, namely 29th, 30th April, 2022 and 13th, 14th May, 2022. There were participants from across the country who attended this course online as well as offline. This was made possible by the novel initiative taken by BCAS to introduce new-age technology to ensure that participants from across the country are able to benefit from the course.

The Study Course began with introducing the basics, namely Structure of FEMA, Capital and Current Account Transactions, Foreign Direct Investment, Overseas Direct Investment, Liaison/Project/Branch Office to more advanced topics, namely ECBs, Succession under FEMA including Trust aspects, Compounding and ED Matters and Corporate Restructuring including Cross-Border Acquisition and ended with a Brain Trust and Panel Discussion on various FEMA issues.

The host of experts who delved into each of the above topics not only made it interesting by sharing anecdotes from their personal experiences but also by making it interactive using case laws and encouraging the participants to ask questions. The participants and speakers were enriched by the quality of questions posed by the participants and their eagerness to know more about the topics in further detail.

LECTURE MEETING – STEERING THROUGH GLOBAL CRISIS WITH SPECUNOMICS

BCAS organised a lecture meeting by Mr. Kushal Thaker on “Steering through Global Crisis with Specunomics” on 18th May, 2022.

The Lecture Meeting was planned with the aim to empower the participants to understand the impact of the current crisis and its impact on global economy and financial markets.

President CA Abhay Mehta welcomed the participants and shared his remarks on the lecture. CA Mihir Sheth, introduced the speaker Mr. Kushal Thaker who is an astute trader and investor in commodities, equities and currency also known as ‘Specunomist’.

The speaker discussed the concepts relating to various asset classes and their analysis.

Synopsis of the meeting and Key Learnings:

1. Indian economy and financial markets
a. Macroeconomic parameters
b. PE and valuations
c. Expected market corrections and targets

2. Global markets
a. PE and valuation
b. Global economic growth
c. Inflation and interest rates

3. Indian Currency
a. Imports
b. Fossil fuels/ Oil
c. Impact of devaluation

4. Crude Oil
a. Country-wise demand-supply
b. Ukraine-Russia crisis

5. Automobile Sector
a. Sales and demand forecast
b. Electric Vehicles (EV) and its impact on the power sector

6. Metals
a. Demand-Supply analysis
b. Reasons for corrections

7. Others
a. Agriculture
b. Semi-conductor industry
c. Asset class mix
d. Textile and Apparels
e. Cryptos

The speaker addressed the queries raised by the participants with enriching inputs and statistics.

The meeting concluded with a well-deserved vote of thanks proposed by CA Kinjal Shah to the speaker, Mr. Kushal Thaker, who addressed the participants from his Chicago office, USA.

Youtube Link:

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BCAS display plate put up by BMC outside the BCAS office.

SOCIETY NEWS

INTERACTIVE DASHBOARDS IN GOOGLE DATA STUDIO EVENT

On 5th March, 2022, the Technology Initiative Committee of the Society organised a session on ‘Interactive dashboards in Google data studio’ via Zoom. CA Rinki Chajjed led the session.

Google’s Data Studio is a tool that turns data into informative, easy to read, easy to share, and fully customisable dashboards and reports. Its basic version is available free of cost. The speaker began with introducing the importance of data and various Business Intelligence tools available in the market for analysing and visualising data. The speaker discussed the pros and cons and the limitation of various tools.

The speaker then briefly discussed the process from scratch of building an interactive dashboard to visualising large numerical data and developing significant insights. The learned speaker provided a brief overview of various aspects of the software, such as data sources, google connectors, third party connectors, etc.

Participants learned new ways of working more effectively with the data studio application. CA Rinki Chajjed satisfactorily answered the questions raised by the participants.

Youtube Link:
https://www.youtube.com/watch?v=oiSiJmHFi2Y

PROSPERITY CONSCIOUSNESS – MANIFESTING ABUNDANCE
On 8th March, 2022, the Human Resources Development Committee organised a workshop, ‘Prosperity Consciousness – Manifesting Abundance’ centred around spiritual concepts and tools on how to create a life of prosperity and manifest abundance. CA Charmie Sheth presented the session.

The workshop started with a powerful aura cleansing technique that helped the participants release stress and worries from their aura, enabling them to be more attentive, actively participate and easily absorb all the new information and tools being shared.

The concept of energy and how our negative thoughts and emotions – which are simply energy – affect our aura and create “energy obstacles” in our success was very well explained and even practically demonstrated. The participants were taught how to scan and check the impact of their emotions and thoughts on their aura.

The workshop proceeded to teach a step-by-step technique on removing these energy obstacles from one’s aura to move the blocks in one’s prosperity and abundance. To verify that the technique works, the participants were taught how to check their prosperity energy before and after this technique. And it was amazing to see how almost everyone’s prosperity energy substantially increased and even doubled in many cases!

The concept of conscious giving and receiving, based on the Law of Karma was explained. To receive, one first has to give. This is nature’s law. There can be no fruit without a seed. This is a very important lesson to remember if we want to increase our prosperity.

The workshop ended with an advanced meditation practise called the Meditation on Twin Hearts which helps to supercharge one’s aura with divine energies and good karma to manifest the life we desire easily.

The workshop was a great success, with active participation from all attendees till the very end of the workshop.

Youtube Link:
https://www.youtube.com/watch?v=_xgnm2xJZTQ

RECENTLY QUALIFIED CA’S FELICITATION EVENT HELD ON 15TH MARCH 2022


“Remember to celebrate milestones as you prepare for the road ahead.”, said Nelson Mandela. Hence, every year, the Seminar, Public Relations & Membership Development Committee (SPR&MD) of the BCAS felicitates the achievers of the CA Final examinations and also attempts to facilitate them with the right guidance for the road ahead.

In the case of the successful finalists of the CA exams, which were held in Nov 2020, Jan 2021, Jul 2021 and Dec 2021, the cracking of the exams which is, after all the first major milestone in their lives, is touted to be tougher given the uncertainties around the globe, and thus the perseverance and grit displayed by these Achievers is particularly noteworthy.

A special discussion, “FUTURE READY – WHAT NEXT?” with two distinguished Core Group members, CA Robin Banerjee and CA Chirag Doshi was held along with the felicitation to guide and mentor these young achievers. The impact of the guidance from these mentors can be best described by feedback from one of the attendees – “Next time, please arrange the session before ICAI campus placement because after session many things seemed clear relating to joining industry or CA firm and the roles.”

The event had close to 300 registrations, including seven rankers.

In his opening remarks, President CA Abhay Mehta congratulated them on this feat and welcomed the young pass-outs into the fraternity.

The Chairman of the SPR&MD Committee CA Narayan Pasari extolled the youth to rise to their role in building a strong nation. He briefed them about the activities of the Committee, including the programs where the Yuva Shakti takes the lead.

CA Samit Saraf, Course Coordinator, introduced the speakers and conducted the talk.

The speakers addressed the question that vexes every batch of pass-outs – industry or practice?  CA Chirag Doshi guided the victors on a career as a practicing CA by sharing his journey and experience in various roles, which left these freshers astonished that a CA in practice can do so much more beyond Tax and Audit.

CA Robin Banerjee successfully embedded the importance of a CA in the attendees’ minds with his witty and bone-tickling stories. He also stressed how it is important for a CA in the Industry to have overall knowledge of all the roles in the company, to climb up the ladder efficiently.

After long online despair, this physical event enabled BCAS to felicitate the achievers in front of their peers. The rankers and a few other achievers were allowed to share their inspiring stories. A ranker spoke about her struggle of coping with this additional pressure of postponement of exams. Another achiever spoke about how she bounced back every time and finally earned the much-proclaimed title after 14 attempts, another lady achiever spoke about her come back after her long sabbatical from Chartered Accountancy career. This was followed up by a celebratory cake-cutting session for the victors.

Convenor, CA Preeti Cherian held a rapid-fire round for the mentors at the end of the session, giving the audience an opportunity to learn a little more about them, their likes and interests. CA Rimple Dedhia proposed a well-deserved vote of thanks.

That the event was well-received was evidenced in the feedback received post the event. This year the Committee also endeavoured to hold a Placement Mela along with the Felicitation event.

PLACEMENT MELA HELD ACROSS 15TH AND 16TH MARCH, 2022 FOR RECENTLY QUALIFIED CAs

“Your big opportunity may be right where you are now.” –Napoleon Hill. Demonstrating this for the fresh victors, this year, the Seminar, Public Relations & Membership Development Committee also endeavoured to hold a Placement Mela in association with Monster.com to be a catalyst by making this valuable opportunity available to new entrants to the fraternity, along with the usual felicitation of the recently qualified CAs.

The Placement turned out to be a successful tiny step towards enabling the young victors to take forward steps to fly high and make the journey smoother for them, with almost 250 interviews (including virtual), being conducted and 25 offers already being given during the placement mela (while final interviews for some of them were yet to be conducted). The placement witnessed the participation of 13 employers and around 150 registered candidates.

The placement was conducted on 15th March, 2022 followed by a felicitation event and a special discussion “FUTURE READY – WHAT NEXT?” later. Owing to the great response and insistence of some employers and candidates, the placement was continued on 16th March.

The faces full of optimism and the bunch of the applications spoke volumes of the zeal to seize the opportunity.

That the event was well-received was evidenced in the feedback that was received post the event.

WORKSHOP – RECENT AMENDMENTS IN COMPANIES ACCOUNTS AND AUDIT RULES INCLUDING DISCLOSURES AND REPORTING

The BCAS Accounting and Auditing Committee organised a hybrid workshop on ‘Recent Amendments on Companies Accounts and Audit Rules including Disclosures and Reporting’ on 26th March, 2022.

Welcoming the participants, President CA Abhay Mehta indicated that this is the first hybrid workshop wherein the physical participation has exceeded all expectations. He indicated that the topics which the speakers will cover are of great importance to the accounting and auditing fraternity and exhorted the participants to derive the maximum benefits.

Thereafter, the Chairman of the Accounting and Auditing Committee, CA Manish Sampat, gave his opening remarks  following which the Convenor CA Amit Purohit introduced the first speaker CA Zubin Billimoria.

CA Zubin Billimoria took the first session and covered the following:

Recent amendments under Schedule III and CARO covering the assets and expenses side of the financial statements, dealing with PPE and Intangible Assets, Inventories and Other Current Assets, Investments and CSR.

The changes in disclosures and the additional reporting requirements, the practical challenges in reporting and the illustrative reporting formats were covered under each of the above clauses.

Nuances of some of the other additional disclosures under Schedule III covering debtors, CWIP, Investment Properties and cryptocurrencies which he indicated would put greater accountability and responsibility on both the Management and the Auditors.

The CARO requirements dealing with the resignation of the statutory auditors before their term and the resultant communication between the incoming and outgoing auditors.

In the next session, CA Nikhil Patel introduced the next speaker CA Rajesh Mody, who covered the following:

Recent amendments to the Companies Accounts and Audit Rules.

The Companies (Accounting Standards) Rules, 2021, which have amended the definition of SMEs who can avail of the exemptions to the general accounting standards. He explained the same with the help of various examples.

The various amendments would lead to enhanced disclosures, better governance, bring about greater financial discipline, give early warning on the solvency status of companies as well as provode early signals towards frauds and money laundering.

In the final session, CA Zubin Billimoria introduced the speaker, CA Santosh Maller, who then spoke on the following:

Recent amendments under Schedule III and CARO covering the liabilities and income side of the financial statements, dealing with borrowings, deposits, wilful defaulters, capital raising, fraud and undisclosed income and whistle blower mechanism and registration requirements for NBFCs.

The changes in disclosures and the additional reporting requirements, the practical challenges in reporting and the illustrative reporting formats were covered under each of the above areas.

Nuances of some of the other additional disclosures under Schedule III dealing with trade payables, registration of charges, relationship with struck off companies, accounting treatment under schemes of arrangements, disclosure of promoters shareholdings, financial ratios, mandatory rounding off, disclosure of grants and donations for Section 8 / 25 Companies, changes in the format of Statement of Changes in Equity (dealing with the treatment of prior period errors under Ind AS-8), and other minor regrouping changes.

All the sessions were highly interactive and the speakers satisfactorily answered the questions raised by the participants.

TRAINING SESSION FOR CA ARTICLE STUDENTS’ ON ‘BANK AUDIT’ HELD ON 4TH APRIL, 2022 VIA ZOOM

The Students Forum, under the auspices of the HRD Committee, organised a training session on the topic ‘Bank Audit’ led by CA Gaurav Save, a proficient speaker on the subject. Mr. Mayur Pandya, the student co-ordinator introduced the speaker to the participants. He was followed by CA Anand Kothari , a Managing Committee member who also addressed the students.

CA Gaurav Save, in his detailed presentation, covered various aspects of bank audit, including the Approach for Statutory Bank Branch Audits.  He also spoke about the Important Circulars / Directives of RBI, Prudential Norms on Income Recognition, Asset Classification & Provisioning pertaining to advances, where he also covered several issues and aspects that needed to be looked into by the article students. He meticulously explained the issues involved through case studies and practical examples; he gave useful tips to the article students on how to effectively conduct a Bank Audit and provided a checklist of the critical areas to be focused upon.

The session was an interactive one whereby the speaker answered all the queries raised by the participants. The session ended with Student Study Circle Co-ordinator Ms. Ekta Singh proposing a vote of thanks to the speaker for sparing time from his busy schedule and making the webinar possible. With the ‘Bank Audit season’ round the corner, the topic had its own importance which could be easily seen by the tremendous response from the students. Overall, 120+ students participated and benefited from the session.

SOCIETY NEWS

HUMAN DEVELOPMENT STUDY CIRCLE MEETING OF HRD COMMITTEE – PRESENTED BY MR. VIJAY KABTA ON 11th JANUARY, 2022 (VIRTUAL ONLINE MEETING)

Topic: ‘Basic Facts on Financial Health of Wealth’

Wealth has many aspects. Wealth need not necessarily mean money. Wealth takes many forms like capital investment in a business, immoveable property, material assets, etc.

Some of the aspects discussed:

1. Principles of Wealth

Laws of Compounding are applicable to all fields of life – namely wealth, relationship, business etc.

Work Within our Circle of competence.

Understanding your circle of competence helps you avoid problems, identify opportunities, helps you learn from others. It improves your decision making and outcomes.

Practice the Concept of Delayed gratification.

Minimise Risk through diversification

2. Devising a plan/ (money) blueprint for creating wealth.

a) “Building a right business ownership mindset is the key to success in creating wealth”, says Warren Buffet.

b) Focus is power, Focus on roots (efforts) rather than fruits (results), What you focus on expands.

c) Understand your current plan. Implement, monitor, evaluate and modify it if needed.    

How to create your Blueprint?    

One can create a blueprint for himself if we understand how it is formed.

a. Awareness – Write Down all the statements you heard about money when you were young.

b. Understanding – How does your thinking originate?

c. Disassociation – Delink your past beliefs or from the way you think.

d. Reconditioning – Understanding how we are conditioned is an important step in reconditioning ourselves.

Key elements of change

How are we conditioned :
 
Programing ThoughtsFeelingsActionResults

a) Verbal Programming, i.e. what we heard when we were young, like money does not grow on trees, it is the root of all evil.

b) Modelling, i.e. What we saw when we were young? We thought of becoming a CA or Doctor or Engineer etc.

c) Specific incidents – Our experiences. If money is unable to save your near and dear ones’ lives, you may feel money is unimportant, hence avoid building wealth unconsciously.

If we change our programming, everything will change. To change the temperature of a room, we need to change the thermostat of the A.C.

Tools and Techniques to create wealth

a) How to select a Role Model?
When we follow our parents or heroes, like the Great Shivaji Maharaj or follow Lord Jesus Christ, we choose our role model knowingly or unknowingly. Choose a role model that suits your temperament, your limitations, had identical struggles in life so that we get a ready blue print to achieve success.

b) Model of a Map
The map of reality is not reality. A map is just a reduction of what it represents. It is a snapshot of a point in time. If we keep this in mind as we think through the problems, we can make better decisions.

c) Inversion Model
Inversion means approaching a situation from the opposite end. Examples: how can I lose money? What is this stock not worth? What can go wrong?

It is a powerful tool to improve your thinking because it helps you identify and remove obstacles to success.

d) A Decision Journal

It is a powerful tool for decision making. It provides insights as to how we make decisions, at what time of day we make decisions that go well and vice versa.

WEBINAR ON ‘NUANCES OF AND INTERPLAY BETWEEN THE ANTI-MONEY LAUNDERING LAW, NEW BENAMI LAW AND BLACK MONEY ACT’ HELD ON THURSDAY, 13th JANUARY, 2022    

 


 

BCAS, jointly with IMC Chamber of Commerce and Industry and Chamber of Tax Consultants, organised a webinar on the topic ‘Nuances of and Interplay between the Anti-Money Laundering Law, New Benami Law and Black Money Act’ to understand the multifaceted and intertwined application amongst the above-mentioned laws.

The webinar dealt with various aspects of the laws relating to the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 –“Black Money Act”, Prevention of Money Laundering Act and the Prohibition of Benami Property Transactions Act – “Benami Act”. Domain experts helmed the session – Advocate Mr. Ashwani Taneja, CA & Ex-Tribunal Member, Dr. Rabi Narayan Dash (Ex-DGIT & Ex-Chairman, Tribunal of PMLA & Benami Law), Mr. Amit Khemka (Advocate, Supreme Court of India). The webinar was conducted in a panel discussion format.

The experts dealt with the basics of the three laws and then went into the enforcement of these laws. They highlighted that while these laws were necessary, the enforcement has gone astray and become difficult. The enforcement is prone to misuse in the absence of checks and balances without any effective remedial mechanism. It is further compounded with practically no time limits for regulatory authorities. The experts also dealt with some live cases revolving around Black Money Act, the substantially amended Benami Act, and how vigorously these laws have been applied. The experts also dealt with several amendments made to tighten the gaps around the existing provisions of the Prevention of Money Laundering Act, 2002 (PMLA).

The experts ended the session by providing practical guidance to practitioners on dealing with proceedings under these laws. The session proved to be of immense help and acted as an eye-opener for professionals from both practice and industry.

Youtube link: https://www.youtube.com/watch?v=guBvID3XVSo
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DIRECT TAX LAWS STUDY CIRCLE MEETING ON ‘RE-ASSESSMENT PROCEDURES EFFECTIVE FROM 1st APRIL, 2021 UNDER SECTION 148(A)’ ON 21st JANUARY, 2022

The Group leader, CA Navin Gandhi, gave a comprehensive analysis of section 148(A) of the Income-tax Act, 1961. The provisions of the section were discussed in-depth in comparison to the erstwhile re-assessment procedures with judicial precedents. Further, cases wherein provisions under section 148A shall not be applicable was discussed.

Thereafter, the group leader discussed in detail appropriate points to be covered in submissions before the Indian Revenue Authorities. The session ended with the speaker providing his concluding thoughts and practical steps to be taken on re-assessment.

‘PUBLIC LECTURE MEETING ON DIRECT TAX PROVISIONS OF THE FINANCE BILL 2022’ HELD ON 5th FEBRUARY, 2022

 
 

The Public Lecture Meeting of the Society on the Direct Tax Provisions of the Finance Bill 2022 by CA Shri Pinakin Desai was held online on 5th February, 2022. This was the 4th lecture meeting on the Finance Bill in a row by him and the 53rd of the Society.

CA. Abhay Mehta, President, BCAS welcomed the speaker CA. Shri Pinakin Desai and the participants. CA Mihir Sheth, Vice President, BCAS introduced the speaker and requested CA Pinakin Desai to formally release ‘The BCAS Union Budget 2022’ Publication, which is an annual feature of masterly analysis of budget proposals

CA. Shri Pinakin Desai covered all important budget amendments in his speech encompassing all major amendments. He gave his explicit views on every important tax proposals and also touched upon the hardship that could arise to taxpayers on account of some of the budget proposals.

The lecture meeting was broadcast live through online platform to more than 1,200 participants. The meeting ended with a round of applause and appreciation by the participants.

Youtube Link: https://www.youtube.com/watch?v=O0YxSToYXu8

     
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HRD STUDY CIRCLE OF HUMAN RESOURCES DEVELOPMENT COMMITTEE

On Tuesday 8th February, 2022, from 6.15 p.m.to 8.30 p.m., the Committee organised a ‘Yoga’ session to Discuss, Teach and Practice YogaAsanas for Curing Diseases. Pradeep Thakkar, a Professional Yoga teacher and an active member of ISH Foundation guided the participants.

He demonstrated and guided participants to perform different Asanas with ease, comfort for healthy body and mind relaxation.

He taught some Powerful Asanas to keep the body flexible and tone the body’s muscles. He also taught various exercises for curing Diabetes, Blood Pressure, Thyroid, Heart, Stomach and other diseases.

Participants had good learning of YogaAsanas for curing diseases to have a healthy body and peaceful mind.

BCAS VISIT TO HON. CBDT CHAIRMAN MR. MOHAPATRA’S OFFICE FOR POST BUDGET REPRESENTATION ON DIRECT TAX PROVISIONS OF FINANCE BILL, 2022.

BCAS was given an appointment on 21st February, 2022 by Hon.CBDT Chairman Mr. Mohapatraji to make a post-budget representation on direct tax provisions of Finance Bill, 2022.

Hon. CBDT Chairman appreciated the role played by BCAS in disseminating knowledge to professionals. He acknowledged that he was also a beneficiary through the reading of BCA Journal during his tenure in Mumbai. He gave a patient hearing for about 50 minutes and was receptive to certain suggestions on amendments which needed reconsideration. BCAS handed over a copy of the representation and he assured that they shall consider the recommendations while passing the Finance Bill. BCAS was represented by President, CA Abhay Mehta, Chairman & Co-Chairman Taxation Committee CA Deepak Shah and CA Anil Sathe respectively, Past President CA Gautam Nayak and Member Taxation Committee CA Anuj Gupta. The representation can be accessed on BCAS website.

BCAS Meeting with Honourable Chairman – Central Board of Direct Tax


 

L-R: CA Anuj Gupta, CA Gautam Nayak, CA Deepak Shah, Shri J. B. Mohapatra, CA Abhay Mehta and CA Anil Sathe

SOCIETY NEWS

TP STUDY COURSE FOR BASIC AND INTERMEDIATE LEVEL
The International Taxation Committee conducted the Study Course on Transfer Pricing (Basic and Intermediate level) from 8th November, 2021 to 6th December 2021.Key highlights:

•    Month-long course, spread over 13 sessions, conducted online over Zoom platform with 150+ participants.

•    In the first week, the speakers covered the basic principles such as an overview of the transfer pricing concept, functional analysis and the various transfer pricing methods.

•    The following week covered issues such as comparability analysis and adjustments, transfer pricing compliances in India and select transfer pricing issues such as intangibles, corporate guarantee, interest, share transfer, locations savings, etc.

•    The participants were taken through the latest developments in the following week covering issues such as secondary adjustments, corporate restructuring, Pillar 1 and Pillar 2, recent important judicial precedents and the impact of Covid-19 on transfer pricing.

•    In the concluding week, the speakers covered various provisions of Advanced Pricing Agreements and issues relating to distributors, licensed manufacturers and marketing intangibles.

•    The course also contained a benchmarking workshop wherein the participants were taken through the entire benchmarking process in a live case study. A Brain Trust session was also held wherein the Brain Trustees debated a wide range of transfer pricing issues and gave their thoughts on the same.

The speakers explained the issues in their topics with case studies and provided a practical insight into various issues which was appreciated by the participants.

The course was ably coordinated by CA Jagat Mehta and CA Chaitanya Maheshwari.

The following were the speakers: CA Hitesh Gajaria, CA Akshay Kenkre, CA Siddharth Banwat, CA Bhupendra Kothari, CA Dhruba Saha, CA Saurabh Dhadphale, CA Hitesh Sharma, CA Archana Choudhary, CA Vaishali Mane, CPA Nilesh Patel, CA Vijay Iyer, CA Swapnil Bafna, CA Karishma Phatarphekar, CA Chhavi Poddar, CA Namrata Dedhia, CA Bhavesh Dedhia, CA Vishal Gada, CA Arun Saripalli, and CA Rahul Mitra.

WEBINAR ON ANNUAL INFORMATION STATEMENT (AIS)

The society had organized the Webinar on “Annual Information Statement (AIS)” on 14th December, 2021, on online platform – Zoom. This online Webinar was addressed by the panel comprising of CA Ameet Patel, Past President of the society and CA Sonalee Godbole, member of Taxation Committee and Journal Committee of the society. The Webinar was broadcasted on YouTube as well for the benefit of membership at large for future reference. More than 1,100 participants were registered and attended this very  crucial Webinar.

The online Webinar was divided into two parts – the first part was very aptly addressed by CA Ameet Patel giving complete information on objectives, documents to be referred to and emanating Whys and How’s of AIS and the second part was very well dealt with by the other capable panellist CA Sonalee Godbole, wherein further niceties of TIS and other relevant, practical and significant aspects of the subject concerned were superbly dealt with. Thus, both the able panellists dealt with the subject very holistically in a very short span of 90 minutes.

Having addressed the online Webinar with their sheer zeal, enthusiasm and gripping style and content, both the panellists addressed queries from the online participants in the most pragmatic manner. The 90 minutes online session was indeed an eye-opener where very current and pertinent apprehensions and initial hiccups relating to the subject concerned of all the participants got satisfactorily addressed.

Online link:

VIRTUAL WORKSHOP ON “HOW TO USE TRANSFER PRICING SOFTWARE”

The Technology Committee of the Society organized a virtual workshop on “How to use Transfer Pricing Software” on 8th January, 2022. The session was led by CA Naman Shirmal.

He began the session with a background to Transfer Pricing and the basis of TP within the Income Tax Act. The session was engaging in a storytelling format with a live presentation on using software in a case study model. He also shared some of the applications that various professionals currently use for TP engagements.

Key matters covered during the session:
• Basic concept of Transfer Pricing and the Income Tax provisions of TP audit.
• Introduction to the general structure of a TP study report followed by a detailed live working on the TP software (“Prosess”).
• How the application would automate and digitize handling of TP engagements.
• How to deal with benchmarking and filtration, especially in geographically spread businesses.
• How the application will enable TP audit documentation.
• How application would enable an auditor to substantiate the quality of TP audits and study reports conducted.
•  Tools and Functions of a good Transfer Pricing Software.
• The ease of use of TP Software.
• Other General usages of Transfer Pricing.

Participants learned new ways of working more effectively with the Transfer Pricing application. CA Naman satisfactorily answered the questions raised by the participants.

LECTURE MEETING ON ESG REPORTING – GLOBAL AND LOCAL DEVELOPMENTS

BCAS organised a Lecture Meeting on ‘ESG Reporting – Global and Local Developments’ in online mode on 12th January, 2022. The Speaker CA Spandan Shah covered the nuances of ESG reporting in detail.

Key matters covered during the Session:
•    Applicability of ESG requirements.
•    Increasing Importance of ESG (Environmental, Social and Governance) in India and Globally.
•    ESG mutual funds shall be allowed to invest in ESG compliant Companies only.
•    Practical examples of ESG.
•    Impact of ESG on Valuation of entity, shareholder wealth, brand valuations, cost of funds. Market cap, investors were covered.
•    Regulatory compliances – SEBI.
•    ESG framework – Outward looking, Inward looking, Sector-specific and other areas.
•    Disclosure requirement – SASB, IFRS, SEBI etc.
•    Reporting requirements under 9 key elements of EGS reporting were discussed in detail.

The speaker responded satisfactorily to the queries raised by the members during the meeting.

Online link:

SOCIETY NEWS

EXPERT CHAT ON INTERNAL AUDIT

An expert online chat on ‘Internal Audit of Indirect Taxation’ was organised jointly by the BCAS and the IIA (Institute of internal Auditors), Mumbai Chapter, on 12th November, 2021. The discussion was moderated by CA Ashutosh Pednekar and also featured CA Sunil Gabhawalla.

The following key matters were deliberated upon during the discussion:

• Should indirect tax be part of the regular scope of internal audit?
• Is there a need to have more awareness about the impact of indirect tax?
• What are the operational, process and control risks to be considered during internal audit of indirect tax?
• What are the anticipated risks in linkages between integrated ERP systems, varied accounting systems and reconciliation between such systems?
• What are the important aspects of GST audit, especially when there is a plethora of documents to be reviewed?
• What kind of complications could arise on account of multiplicity of registration and multiplicity of returns filed by an entity?
• How do internal auditors cope with the complexity of GST law?
• How do internal auditors identify and deal with cases of regulatory violations as internal auditors are required to report cases of fraud, if any, under the Companies Act?
• What’s your view on the massive data points being available in the GST regime and expectations from the internal auditor?
• How can an internal auditor create awareness amongst the Board members on early warning signals on GST-related issues?

The speaker answered all the queries raised by the participants at the end of the meeting.

Online link: https://www.youtube.com/watch?v=YRM6BIeYDQA
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SEMINAR ON INPUT CREDIT ISSUES

As it does every year, BCAS conducted a half-day seminar in association with DTPA Kolkata. It was held on 20th November in hybrid mode.

The subject under discussion was ‘GST: Input Credit Issues and Controversies of Direct Tax issues covering Sections 45(4) and 9B’.

Among the learned speakers were past presidents CA Anil Sathe and CA Sunil Gabhawalla. While Anil Sathe dealt with issues covering section 45(4) of the Income-tax Act, 1961, Sunil Gabhawalla covered the controversies in input credit under GST.

BCAS was also represented by President CA Abhay Mehta and Vice-President CA Mihir Sheth. The DTPA Kolkata was represented by its President, Vice-President, Treasurer, Secretary and Conveners, apart from a cross-section of people consisting of chartered accountants, lawyers and tax practitioners. The seminar took place over two sessions, each of which was followed by a Q&A session, with answers being provided by the learned faculties.

KEY ISSUES UNDER SLUMP SALE

A virtual meeting was organised by the Direct Tax Study Circle on 25th November. The meeting discussed the subject ‘Key Issues Under Slump Sale’ and was led by CA Kinjal Bhuta.

Key Speaker Kinjal took members through various Income-Tax provisions relating to slump sale. She explained some of the issues surrounding computation of slump sale gain, net worth, undertaking, permissibility of carry forward of unabsorbed losses and depreciation, etc. To make the session more interactive, she incorporated several case studies. The meeting was a success and concluded with a vote of thanks to the speaker.

CUSTOMS DUTY AND FOREIGN TRADE POLICIES

The IDT Committee of the BCAS, along with the Chamber of Tax Consultants, organised a two-day virtual workshop on ‘Customs Duty and Foreign Trade Policies’ on 26th and 27th November. The programme was divided into four sessions of two hours each and spread over two days.

The speakers at the workshop were Adv. V. Sridharan, Adv. Raghuraman, Adv. Rohit Jain and Mr. Sudhakar Kasture. The following topics were covered:

(a) Levy and chargeability under the Customs Act and procedures for import and export, along with interplay with the GST;
(b) Classification and Scheme of Customs Tariff Act and Principles of Customs Valuation and SVB;
(c) Specific provisions such as bonding, warehousing and other miscellaneous topics, including EOU and SEZ; and
(d) Important concepts under Foreign Trade Policies, various incentive schemes and issues – and bilateral and multilateral agreements.

The session addressed by Adv. V. Sridharan was chaired by President CA Abhay Mehta, while IDT Committee Chairman CA Sunil Gabhawalla gave the concluding remarks.

Adv. Rohit Jain’s session was chaired by IDT Committee Chairman CA Sunil Gabhawalla.

Conveners Dushyant Bhatt, Mandar Telang and Saurabh Shah and Committee Member Suresh Choudhary introduced the speakers / proposed the vote of thanks.

Other introductions / presentations and moving of votes of thanks were done by the Chamber’s representatives.

LECTURE MEETING ON FUTURE PERFECT

An online lecture meeting styled ‘Future Perfect’ was organised on 1st December. It was addressed by Mr. Rahul Bhagat, Business Head, ICICI Prudential Pension Fund Management.

Mr. Bhagat made a crisp presentation on the need for retirement planning with special emphasis on the NPS (National Pension System).

Key takeaways from the presentation were as follows:

• Importance and need for retirement planning,
• Increase in life expectancy,
• Better healthcare at a higher cost,
• Changing demographics,
• Nuclearisation of families.

• How a retirement plan works,
• Accumulation phase,
• Pay-out phase.

• Important factors for choosing a retirement plan.

• Popular options for retirement planning – A comparative analysis of various investment products.

• NPS (National Pension System)
• Concept
• Features
• Benefits

The speaker answered all the queries raised by the members in the course of the meeting, which was attended by over 80 persons.

Online link: https://www.youtube.com/watch?v=tvaa0-9HRRs
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EXECUTIVE COACHING FOR BUSINESS LEADERS

The HRD Committee Study Circle held its meeting on 14th December which provided ‘Executive Coaching for Business Leaders’.

The Chairman welcomed the participants, while the Past President introduced the speaker, Mr. Pradip Shroff.

Here are some highlights of the meeting:
• The concept of coaching is new in business, although prevalent in sports.
• Coaching is to tap and unleash potential.
• It’s a super specialisation of HR which calls for good understanding of the business and also a passion to coach.
• Essentials of coaching.
• Good listening.
• Business understanding.
• Empathetic presence and understanding.
• Art of deep probing.
• Summarising.
• Challenging both resistance and denial.

Mr. Pradip Shroff is a senior coach representing the Coaching Foundation of India. Among its
activities is formal training, assignment of hands-on projects, viva and a certification course lasting about ten months.

It provides an excellent opportunity for Chartered Accountants having an analytical background to take up coaching as a career.

The total number of participants was 45. CA Mukesh Trivedi anchored the question-answer session and also proposed the vote of thanks.

FORENSIC ACCOUNTING & INVESTIGATION STUDIES – E-LEARNING COURSE

The Internal Audit Committee of Bombay Chartered Accountant’s Society (BCAS) jointly with Chetan Dalal Investigation & Management Services (CDIMS) launched an e-learning course titled, “Forensic Accounting and Investigation Studies” (FAIS) in December 2020. On the completion of one year from the launch of the course, we are glad to report that in all 61 participants have enrolled for this course, out of which 30 participants have successfully completed it by November 2021 and have been awarded a certificate to that effect.

This course provides unique e-learning for all those professionals in practice, industry or management, finance experts, CA students who are keen to explore a career / specialisation in forensic services or simply want to improve their audit skills by blending ‘Forensics’ and make an exponential difference in their value offerings. The course is designed in 25 Modules of Conceptual & Advanced Knowledge of Forensic Accounting & Fraud Investigation based on case studies, followed by online tests. Delivered through online videos, and the inclusion of case studies make this course engaging and interesting. The e-learning platform provides the opportunity of anytime-anywhere learning. A window of three months is provided to the participants for course completion.

In the course, we have made a few revisions based on the feedback received and our own experiences. We have introduced a demo module for aspiring participants; we now have modular exams in place rather than a single comprehensive exam at the end of the course. The demo module has been uploaded to the BCAS website and can be accessed via an e-mail request to be sent at events@bcasonline.org or through scanning a QR code embedded with login credentials.

The course earlier had an open rolling admission allowing the participants to enrol and start the course at any time. We have now replaced the rolling admissions with quarter admissions at the beginning of the quarter. The window for enrollment of the FAIS course, Batch 1 of 2022, will be kept open from 23rd December 2021 to 21st January 2022 and will require the participants to complete the course by 30th April 2022. To encourage young professionals and students, substantial discounts are being offered to those below 30 years of age as of 1st January 2022. They can visit https://bit.ly/3ehSsVO to avail this offer. Group discounts are also being offered for those enrolling in a group of three or more. They need to contact the BCAS events team at +91 9819955293 or send a request at events@bcasonline.org.

Society News

LEARNING EVENTS AT BCAS

1.    It’s about Beverages – A GST Perspective – Indirect Tax Laws Study Circle Meeting

In a meeting organised on 8th May, 2023, CA Gaurav Kenkre, group leader of the BCAS Indirect Tax Laws Study Circle presented six crisp and interesting case studies on GST rates, classification and input tax
credit on supply of Beverages. The presentation and discussion broadly covered the intricacies on the following topics:

1.    Eligibility of Input Tax Credit on purchase of various beverages (including water) for consumption of staff, customers, etc.,

2.    Charge of GST on Cocktails (Mix of alcoholic and non-alcoholic drink) in a Pub,

3.    Charge of GST on Cover Charge towards unlimited alcoholic drinks and food,

4.    Reversal of Input Tax Credit towards use of non-alcoholic drinks along with alcoholic drinks,

5.    HSN classification of carbonated fruit beverages,

6.    HSN classification of aerated tea beverages.

Around 102 participants across India benefitted by actively participating in the meeting held under the mentorship of Adv. A Jatin Christopher.

2.    Controversies under Liberalised Remittance Scheme (‘LRS’) – FEMA Study Circle Meeting

On 28th April, 2023, a meeting of the FEMA Study Circle was organised. The meeting was led by CA Bhavya Gandhi, group leader. The topic for the meeting was “Controversies under Liberalised Remittance Scheme.”

The meeting focused on issues arising from the amendments to the LRS in August 2022, especially the restriction on holding idle funds abroad beyond 180 days, clubbing of remittances for purchase of immovable property abroad and insertion of definition of “bonafide business activity.” Other existing controversies under LRS were also taken up like extending loans under LRS, remittance out of borrowed funds, etc. The relevant provisions and issues under each controversy were presented by the speaker along with his views on the same.

Held at the Society’s premises, the meeting was attended by about 15 members in-person and over 90 members virtually. The members raised and discussed several queries and also shared their views and practical experiences.

3. GST implications on Digital Assets – Indirect Tax Laws Study Circle Meeting

The Indirect Tax Laws Study Circle of the Society held a meeting to discuss the Goods and Services Tax (‘GST’) implications of digital assets. The meeting was led by CA. Hanish S, discussing six case studies that addressed the practical issues of virtual digital assets. The presentation and discussion covered the following topics:

1.    Understanding whether Virtual Digital Assets/Crypto Currency are currency as per GST Law,

2.    Whether purchase or sale through mobile app tantamount to supply,

3.    If consideration of supply is discharged in crypto currency whether it results in a separate supply,

4.    Can crypto assets or virtual digital assets be attached as property of taxable person by the department in case of non-recovery of taxes or other dues,

5.    GST implications on mining rewards w.r.t supply, employer-employee relationship and subsequently Schedule I effect and overall GST Implications.

6.    Can illegal income be subjected to tax like Income tax Act.

74 participants from all over India took an active part in the meeting held under the mentorship of Adv. K. Vaitheeswaran. Participants expressed gratitude for the immense work of the group leader and expert inputs by the mentor.

4.  – Season 2

In the words of Galileo Galilei, “You cannot teach a man anything. You can only help him discover it within himself.”

Seminar, the Public Relations & Membership Development Committee of the Society organized the second season of the  meeting with an aim to nurture young professionals and give them an opportunity to explore the possibilities that await them. The meeting was held under the guidance of senior professionals who in turn derived the satisfaction of having mentored young professionals and contributed to their lives.

The Committee invited registrations from both members and non-members aged thirty-five and below. It also reserved a few seats for women participants with no age limit. The mentees performed their own SWOT analysis and shared their questions and concerns at the time of registration. They were also requested to submit their CV to enable the mentor to prepare better for the online mentoring session.

Season 2 of the special series “” saw twenty-three mentors from the Core Group help twenty-nine mentees introspect, reflect and discover the potential within themselves. These twenty-nine mentees hailed from six states and included three rank-holders.

Due care was taken to pair the right mentor with the mentee, and the online session was scheduled at their mutual convenience. In most cases, the session went well beyond the planned sixty minutes, with both the mentor and mentee enjoying the conversation and identifying the prospects that lie ahead for the mentee.

The feedback obtained post the session from both the mentees and mentors to this unique program was exceptionally encouraging.

Society News

LEARNING EVENTS AT BCAS

1. LECTURE MEETING ON CHALLENGES IN IMPLEMENTATION OF AQMM
 

Bombay Chartered Accountants’ Society organised an online lecture meeting on the topic ‘Challenges in Implementation of Audit Quality Maturity Model (AQMM) on 20th February. 2023. The meeting was attended by over 150 participants.

CA Durgesh Kabra shared the history and need of AQMM, its phase-wise applicability to various firms, benefits of self-evaluation vis-à-vis evaluation by peer reviewer, overview and weightage of various sections and sub-sections in the AQMM.

CA N. Jayendran, commenced his session by sharing the advantages of AQMM for practising units. He shared the process to re-assess AQMM, fees for review by peer reviewer. He shared his views on some of the challenges in the implementation of AQMM especially for SME firms:

  •     Weightage of various aspects in score card like HR, qualitative aspects, etc

 

  •     Negative scoring on regulatory action for unsatisfactory work by a regulator

 

  •     Same set of questions repeated leading to incorrect assessment

 

  •     Vision and mission statement may become surrogate advertising

 

  •     Low weightage of 1.33 per cent to audit manual despite it being necessary for quality audit compared to good internet connection having weightage of 15 per cent

 

  •     Maintenance of records for low value small audit

 

  •     Lack of clarity on score where no QRB audit has been conducted during the period

 

  •     Evaluation of questions on client disputes, IP-based attendance monitoring, data security and cyber security, adherence with minimum scale of fees for small and miscellaneous work

 

  •     Budgeting and monitoring tools for smaller firms

 

  •     Dedicated help desk lacks clarity

 

  •     Maintaining Partner to manger ratio, minimum staff to partner ratio, manager to article ratio, client to staff ratio, etc

 

  •     Focused policies for support for staff wellbeing, engagement and communication, gender diversity, credible employee survey, compensation management.

CA N. Jayendra appreciated the overall benefit that would accrue with this exercise despite various initial challenges in implementation of AQMM.

Both the speakers satisfactorily addressed the queries raised by the participants.

BCAS Lecture Meetings are high-quality professional development sessions which are open-to-all to attend and participate. Missed the Lecture Meeting, but still interested in viewing the entire meeting video

Visit the below link or scan the Q.R. code with your phone scanner app:

Link – https://www.youtube.com/watch?v=SaRrKcAoisA

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2. HRD STUDY CIRCLE MEETING ON AVERTING DANGEREOUS SITUATIONS

The Bombay Chartered Accountants’ Society organised a session on identifying potentially dangerous people on the basis of their facial features. Conducted under the aegis of the Human Resources Development Study Circle on 14th February, 2023 the hybrid session included presentation on reading ‘Red Flags on Face – An Iota of Alertness Can Avert a Potentially Dangerous Situation.’ by Naresh Kokal.

Attended by 78 people, session at the Churchgate premises of BCAS started by pictures of visages of Asuras/Demons, created by artisans of India, and depiction of ferocity in the images. The eyes and surrounding areas, displayed the inherent brutality of the face.

In the subsequent slides of pictures of leaders – Indian & Foreign, celebrities,  politicians and underworld dons, it was demonstrated that the browbones, eyebrows, eyes, chin and jaws account for the barbarity.

The browbones show the need to control others. The eyebrows, the passion, energy and leadership qualities

The eyes show the heart in general, the size of the iris and sclera shows the state of the mind. The Chin shows the willpower. A broad chin is usually noticed on Dictators.

The Jaws show determination. They show the resoluteness. They also point to the potential terror that these people can unleash. The session ended on the note that although these signs show a dangerous person, they could also be found on Successful Entrepreneurs.

This was followed by Q & A session, where the attendees asked their questions which were answered.

The session ended with the Chairman thanking Naresh Kokal for the presentation.

Link – https://www.youtube.com/watch?v=SWyLuJVn0dM

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3. SESSION ON SECTION 138 OF NEGOTIABLE INSTRUMENTS ACT

The Corporate and Commercial Laws Study Group convened a session on Section 138 of the Negotiable Instruments Act and concomitant provisions related to prosecution for cheque bouncing on 13th February, 2023.

Titled, “Prosecution for cheque bouncing: Overview of the law, issues and solutions,” the session was led by speaker Adv. Kartik Garg who took the participants through detailed notes on the law and judgments under each provision. He explained the concepts in a lucid manner. In fact, the notes were of such sterling quality and were so exhaustive that no more oral explanation was required.  After the session these notes were circulated amongst the participants. Around 55 participants attended the session. Further sessions on other white collar criminal topics are in the process of being scheduled.

4. LECTURE MEETING ON DIRECT TAX PROVISIONS OF THE FINANCE BILL 2023

The Society organised a public lecture meeting on ‘Direct Tax Provisions of the Finance Bill 2023.’ Addressed by CA Pinakin Desai, the meeting was held at Yogi Sabhagruha on 7th February, 2023. This was the 5th lecture meeting by him and the 58th of the Society.

The lecture meeting was live streamed and witnessed by more than 5,000 persons including online viewers. CA Mihir Sheth, President, BCAS welcomed and shared his thoughts about the Budget. He then invited CA Chirag Doshi, Vice President to introduce the speaker.

Mr. Desai started his speech by appreciating the Finance Minister’s speech having met the public expectations. He also discussed on the various new insertions/amendments in areas of rate of tax and alternating tax regime, angel tax, capital gain exemptions for residential house, taxability of Nil cost assets, disallowance under section 43(b) in case of delay in payment to MSME, taxability of life insurance policies, market linked debentures. The talk also covered other aspects of the Direct Tax Provisions for Charitable trusts, dealing with the refund cases, TDS provisions, assessment provisions, etc. which were part of the Finance Minister’s speech.

CA Pinakin Desai expressed his views on every important tax proposal under the Finance Bill, 2023.

The audience benefitted greatly from his speech. The meeting ended with a huge round of applause and appreciation by the participants.

Visit the below link or scan the Q.R. code with your phone scanner app:

Link – https://www.youtube.com/watch?v=XxDNgV4bOVg

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5. STUDY CIRCLE MEETING ON ‘PROFESSIONAL CHALLENGES IN HANDLING INQUIRIES AND RECENT JUDICIAL PRONOUNCEMENTS RELATED THERETO.’

The Indirect Tax Committee organised a hybrid Study Circle meeting at the Bombay Chartered Accountants’ Society Auditorium on 6th February, 2023

The meeting focused on the topic titled ‘Professional Challenges in handling inquiries and recent judicial pronouncements related thereto.’ It was presided by Adv (CA) J. K. Mittal who deliberated on the challenges in handling multiple inquiries and ratio of recent judicial pronouncements. He covered the following aspects in detail

  •     Power to summon and give evidence under section 70 with explanation of producing a document and evidence and the time when the same needs to be available

 

  •     Whether a summons constitute an enquiry by itself

 

  •     Judgment of Canon India (P) Ltd of honorable Supreme Court to clarify “the proper officer” does not mean “Any proper officer”

 

  •     Essential ingredients of issuing summons

 

  •     Whether legal opinions provided by chartered accountants lead to aiding or abetting in case of alleged evasion

 

  •     Three factor ingredients of section 67 “claimed ITC + in contravention of any + to evade tax”, its need and necessity to exist before start of investigations, search, seizures

 

  •     Whether cash can be seized during the search

 

  •     Issues in relation to retrospective cancellation of GSTIN

 

  •     Disallowance of mismatched ITC, legality of the said provisions

The two-hour meeting benefitted 73 participants from across who posed several questions to the speaker in the physical as well as virtual mode.

6. FELICITATION OF CA FINAL PASS-OUTS OF NOV 2022 BATCH

On January 30, 2023, BCAS felicitated the young pass-outs of Chartered Accountancy of the November 2022 batch at a special function held at the BCAS Hall.

The felicitation ceremony was preceded by a talk on the subject “Milestone 2.0 – Career in International Tax, Mergers & Acquisition, Start-ups and More” by experts, CA Namita Gad, CA Kinnari Gandhi and CA Siddharth Banwat.

Each expert guided the 180-strong audience on the skillsets and aptitude required for the respective profile job, while sharing some of the challenges faced and how to overcome them. The discussion was appreciated by the young achievers. The experts also answered the questions posed by the the audience at the time of registration. Some basic questions were also taken up at the end of the talk. The entire event was coordinated by the team comprising CA Rimple Dedhia, CA Samit Saraf and CA Vivek Shah.

Youtube link: https://www.youtube.com/watch?v=VMDuFfMd1YU

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7. INCOME TAX KI PAATHSHAALA – LONG DURATION CERTIFICATION COURSE ON INCOME TAX

The BCAS Taxation Committee organised a Long Duration Certification Course on Income Tax – ‘Income Tax ki Paathshaala’ from 2nd January to 30th January, 2023. The meeting comprised 21 sessions. The key note addressed was delivered by CA TN Mahoraran while the concept and scope of total income was explained by CA Nandkishor Hegde. CA Narendra Jain touched upon the concept of Residence and the income deemed to be achieved or deemed to accrue in India.

Other speakers at the event included CA Ronak Doshi, CA Chaitee Londhe, CA Abhitan Mehta, CA Krishna Upadhay, CA Kinjal Bhuta, CA Bhaumik Goda, CA Sonalee Godbole, CA Gautam Nayak, CA Hitesh Gajaria, CA Rutvik Sanghavi, CA Amil Sawant, CA Toral Shah, CA Avinash Rawani, CA Nikhil Tiwari, CA Ashok Mehta, Adv. Rahul Hakani, CA Ameet Patel, CA Anil Sathe and CA Nihar Jambusaria

Attended by 212 participants, the course received an overwhelming response. Each of the participant was given a certificate of participation in the Long Duration Course organized by the Taxation Committee of BCAS.

8. ITF STUDY CIRCLE MEETING ON UAE CORPORATE TAX REGIME

ITF Study circle meetings were organised on UAE Corporate Tax Regime in two sessions on 6th January 2023 and 25th January 2023.

The meeting was led by group leaders CA Janak Panjuani and CA Rajiv Hira from Dubai. The sessions covered the UAE Corporate Tax laws in a holistic manner. The group leaders focused on the basics of corporate taxation, residential status, Permanent Establishment (PE), importance of Anti-Money Laundering (AML) compliance.

Specific concepts pertaining to taxability of unincorporated JV / associations, reliefs to small businesses, exempt income, FTZ etc. along with case laws were discussed in detail to give a better understanding to the participants.

The group leaders also discussed the topics of interest deduction, interest capping rules, non-deductible expenses, tax loss, carry forward of losses and losses adjustment, tax groups, transfer pricing provisions, managerial remuneration, etc.

An interesting round of Q & A with the participants was elaborately addressed by the speakers.

9. SESSION ON LAW FOR REDEVELOPMENT OF SOCIETIES

On 16th January, 2023, Ms. Rucha Jog Raheja, Solicitor addressed a session in the Corporate and Commercial Laws study group on the law relating to redevelopment of societies. After dealing with the legal concepts and need for redevelopment, Ms. Jog Raheja gave a brief account of the law relating to deemed conveyance and the drafting mistakes made in the legal documentation governing the rights of parties before, during and after the actual redevelopment. The session addressed many misconceptions and wrong assumptions of the audience. Finally, Ms. Jog Raheja dealt with all the questions asked by the audience. After the session many suggestions were received for more sessions on niche aspects of redevelopment like deemed conveyance, etc. Further sessions focusing on drafting particular contracts relating to redevelopment will also be scheduled. Over 80 participants attended the session and a very strong positive feedback was received from the participants.

10. 20TH RESIDENTIAL RETREAT – LEADERSHIP SKILLS ORGANIZED IN MUMBAI

The 20th Residential Retreat – “Leadership Skills and Management-The Chanakya Way” was organized by Dr. Radha Krishnan Pillai on 14th and 15th January, 2023 at Keshav Shrusti in Bhayander, Mumbai.

Faculties Dr. Radhakrishnan Pillai and his colleague Mr. Pranav Patel explained Chanakya’s life and his vow to pull down the Nand Dynasty promising Chandra Gupt Maurya to make him a King and thus proving that leadership is an attitude and not a designation.

Participants were enlightened on the term “Aanvikshiki” – educating them on how to think using science. This helped them differentiate between chinta and chintan i.e.going to root cause, understanding real problem and find appropriate resolution.

Further they explained Kautilaya “Saptanga” – The Seven pillars:

1. – The King – Leader

2. – The Minister

3. – The Country – Your Market / Client / Customer

4. – Fortified City – The Head Office

5. -The Treasury

6. – The Army – Your Team

7. – The Ally – Mentor / Friend / Consultant

All these seven pillars were explained in detail with applying the Saptang model. The faculty also showed them a film based on a book titled ’Corporate Chanakya’ featuring interviews of imminent personalities applying the Saptang model. It also distributed a workbook containing details on The Seven Pillars to find Chanakya in You.

The faculty explained that despite being a thankless job leadership gives utmost inner satisfaction. It also emphasized on documentation, standardization and having a succession plan and to create another leader. Besides, it discussed management lessons from Bhagvad Gita.

Around 38 participants attended the event which included games, singing and dancing in a perfect winter setting and camp fire. The event ended on the second day giving the participants a clarity on the roles and goals in each sphere of life.

Society News

NEW INITIATIVES AT BCAS

At BCAS, a constant endeavour is always underway to exceed the expectations of its members and continue to remain a preferred professional development body for Chartered Accountants. The BCAS legacy over the last 70+ years has been enamoured by its ability to evolve with changing times and remaining extremely relevant to its ever-evolving community.

At the Society various initiatives are underway and few mentioned below have fructified over the last months:

1. Revamped audio-visual infrastructure at BCAS Auditorium:

Modern-day learning delivery environment is significantly different in comparison to the earlier times. This difference was further accentuated by the Covid-19 pandemic which made adoption of digital learning a common-place. BCAS is blessed to be one of the few professional societies of Chartered Accountants to have its own physical auditorium to conduct live events. Over the last few months the entire audio-visual infrastructure at the BCAS auditorium has been revamped by addition of state-of-the-art 4K LED visual screens, hybrid classroom infrastructure, studio-quality voice and sound equipment, surround-sound microphones, teleprompter and multiple point-and-zoom cameras.

These upgradations have significantly improved the learning delivery capabilities from the BCAS Auditorium. Members are encouraged to attend an in-person event at the BCAS Auditorium and experience the new-age digital infrastructure.

This hybrid infrastructure is also available for use to members who choose to make use the BCAS Auditorium for their own learning events.

2. Self-paced learning through E-Learn initiative:

Self-paced learning courses and event recordings are available through the E-Learn learning management initiative of BCAS. Members can now access a catalogue of courses and event recordings by accessing the E-Learn module. The E-Learn platform opens up the BCAS learning content to its large base on outstation members as well.

3. WhatsApp communication with members:

WhatsApp has today become the de-facto choice of quick communication. BCAS has initiated an additional communication channel with its members through WhatsApp. A right balance of quick communication and respecting member privacy will be embedded in the WhatsApp communication initiative.

Once you receive any BCAS WhatsApp message, do save the senders phone number in your mobile address book. This will help in seamless communication moving forward.

4. BCAS back-office on cloud infrastructure:

The Society is able to deliver on its objectives owing to a strong back-office team at the BCAS office. The BCAS office staff comprises a team of more than 20 committed individuals who work diligently to serve the large BCAS membership. With an objective to enable the key departmental heads at BCAS to seamlessly perform their roles, each of them have now unhindered access to Microsoft cloud infrastructure equipping them with seamless access to data, co-creation collaboration and backup capabilities.

5. QR Code and UPI payment functionality:

In a recent initiative, BCAS has enabled receiving payment through QR code as well as through UPI. This functionality is enabled at BCAS front office reception as well as the publication kiosks at the event location.

 

EVENTS AT BCAS

1. HRD COMMITTEE ORGANIZES ‘TARANG 2K23’

Under the auspices of the HRD Committee of the Bombay Chartered Accountants’ Society (BCAS), the Students’ Committee organized the 15th Jal Erach Dastur CA Students’ Annual Day competition from 24th December, 2022 to 8th January, 2023.

Described as an ecstatic annual CA students’ celeberation, Tarang 2k23 was engaging, enthralling and magnificent. Under the requisite guidance of CA Anand Kothari, CA Jigar Shah, CA Dnyanesh Patade and CA Utsav Shah, Tarangs mainly intended to provide a platform for CA students to unleash their talent and creativity in areas of public speaking, writing skills, performing arts, business, technical and innovative skills. Additionally, the event also intended to act as an insight and potential gateway into the real world outside academic books by providing access and tutelage by skilled and experienced leaders in the form of participation in various fields to building interpersonal relations and network with hundreds of like-minded students.

This year’s Students’ Committee comprised a group of 31 passionate and enthusiastic students. Tarang 2k23 changed the earlier dull and monotonous perception of the CA students as they were now being witnessed as event managers, anchors, talented dancers, and photographers too!

It was truly an event ‘Of CA Students, By CA Students and For CA students.’

Tarang 2k23 saw a huge enrollment of around 500 students despite the Christmas holidays and pending due dates. Overall 279 students participated in the event along with the highest number of participants witnessed in the ‘Talent Show’ and the ‘Antakshari Competition.’ This year Tarang 2k23 also introduced the revolutionary event “CA’Preneur – Pitch Your Business Ideas,” whose concept was taken from the popular TV show, ‘Shark Tank India’ to promote thinking, problem-solving and entrepreneurial skills amongst CA students. The event received huge enrollments along with some amazing ideas being pitched to the judges.

The elimination rounds of the 15th Jal Erach Dastur CA Students’ Annual Day – ‘Tarang 2K23’ were held at the BCAS Hall on the 24th and 25th, December, 2022 with the beautiful Christmas themed décor to give the participants a joyful vibe. To keep the crowd engaged, the students’ team organized various online games and networking sessions including the Tarang’s Networking Bingo and an intriguing Quiz via the Zoom platform two days prior to the grand finale day. This provided a unique opportunity to all participants to build a productive and constructive network along with a lot of fun too.

The Grand Finale of Tarang 2k23 was held at the Lala Lajpat Rai College Auditorium on 8th January, 2023. Vahura and IDFC Bank sponsored the winners’ prizes for various games and quizzes held online. Arrangements for various exciting game stalls, live caricatures and a 360° photobooth were made to engage and build excitement amongst the audience before the event’s commencement.

The grand finale commenced with the lighting of lamp by the HRD Committee and the student coordinators with the Ganesh Vandana and Saraswati Vandana being played in the background

The event kickstarted with a ‘Antakshari Competition’, where the two finalist teams namely, ‘Deewane’ and ‘Parwane’ competed on the stage. The event comprised engrossing rounds to test the presence of mind the sound musical knowledge of the participants. It was hosted by CA Vijay Bhatt.

The next event to follow was a Debate Competition with eight finalists. The moderator for this event, titled, “Traditional Indian educational system of Gurukul was more effective than today’s Universities,” was CA Ujjwal Gadhvi. The tagline for the Debate was “War of Words.”

This event was followed by the ‘Talk Hawk,’ sponsored by the Chandanben Maganlal Bhatt Elocution Fund. Here, three finalists were given four minutes to speak on any one of the 10 given topics.

This was followed by a short 15 minutes break after which Tarang 2k23 resumed with a blissful and soothing jamming session with some beautiful lyrical songs sung by the students’ team. This was followed by an energetic and well-coordinated Bollywood dance flash mob choreographed by CA Rishikesh Joshi.

The most anticipated event of the evening, CA’s Got Talent! included 12 performances by the finalists in all three categories including – music which included vocals as well as instrumental, dancing and the other performing arts category.

This was followed by a short 2-minute video which was a compilation of the past 14 years of the event Tarang.

The concluding valedictory session started with the displaying of the compilation of business ideas of the contestants of the CA’Preneur competition.

Post that the winning reels and the pictures of the Tarang Reel Star and the Khinch Le Photography Competition were displayed on the screen. Two prizes, in each of the two categories; namely, the Public Choice Award and the Judges’ Choice Award, were given.

The winners of the competition representing their firms were also announced.

The event was anchored by Ekta Singh, Krrish Pipaliya and Nikita Sahu, who ensured an environment full of spirit, vigor and humor.

Mayur Pandya and Sagar Gupta proposed the vote of thanks to Sohrab Erach Dastur, the family of Chandanben Maganlal Bhatt, Managing Committee and HRD Committee members, event coordinators, photographers, BCAS Staff, parents, sound technicians, student volunteers, CA students and the audience.

Link – https://www.youtube.com/watch?v=jqOB2df7W8k

Society News

LEARNING EVENTS AT BCAS

1. SPR&MD Committee felicitates young CAs

The Seminar, Public Relations & Membership Development Committee (SPR&MD) Committee of BCAS felicitated young successful CAs of the  May 2023 Examination at a talk show titled “Let’s Get Techni-CA-l – Avenues & Opportunities” held on 11th August, 2023 at the Society Hall. The event was attended by over 100 participants, including some walk-ins.


Felicitation of ChAmpion CA Shubham Nighute by President, CA Chirag Doshi, Past President and Committee Chairman, CA Uday Sathaye and the eminent speakers, Past President CA Nitin Shingala and CA Vivek Shah (not in the pic)

The two eminent speakers, CA Nitin Shingala (Past President) and CA Vivek Shah, enthralled the audience with their presentations and guided them on how to mould themselves into becoming discerning professionals.
E-felicitation of ChAmpions and All India Rankers: AIR 10 CA Pooja Baghmar and AIR 11 CA Gogula Bhargavi
The audience were overwhelmed after listening to the experiences shared by CA Shubham Sahebrao Nighute during his journey of becoming a chartered accountant overcoming various obstacles and innumerable challenges faced by him in his life. Two other all-India rankers, AIR 10 CA Pooja Baghmar from Chennai and AIR 11 CA Gogula Bhargavi from Vijaywada were also e-felicitated. They too shared their experiences with the audience.

Visit the below link or scan the QR Code with your phone scanner app:

YouTube Link:  https://www.youtube.com/watch?v=N_Hs-Hu899c

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2.    ITF Study Circle Meeting on “Taxation of Software as a Service”
The International Tax and Finance Study Circle of the Society organised a hybrid meeting on 10th August, 2023 to discuss the topic of “Taxation of Software as a Service”.

  • The discussion began with the speaker CA Divya Jokhakar touching upon different services (with examples) which would be covered by the expression Software as a Service (‘SaaS’).

 

  • The taxability of payments for SaaS as royalty under the Income-tax Act, 1961 (‘the Act’) as well as various tax treaties was discussed.

 

  • Various provisions of Copyright law were also discussed to test the application of the definition of “royalty”.

 

  • Further, the situations in which such payments would attract the provisions related to capital gains were also discussed.
  • Further, the prospect of these payments falling within the ambit of Fees for Technical Services (‘FTS’) was also discussed.

 

  • During the course of discussions, key rulings of the Supreme Court in the case of Engineering Analysis Centre of Excellence (P.) Ltd (432 ITR 471) and Kotak Securities Ltd (383 ITR 1) were discussed.

 

  • It was further discussed that once such payments were not taxable as royalty / FTS, the taxability as business profits would need to analysed – both in terms of the Act (business connection) and the treaty.

 

  • The applicability of Equalisation Levy II (introduced in 2020) to the payments for SaaS was also discussed.

 

  • The speaker suggested the order in which the above provisions ought to be applied in order to determine the taxability of SaaS.

Towards the end of the session, various practical examples in terms of the taxability of services such as Zoom, Mailchimp, Office 365, etc — which are used frequently — were discussed.

3.     Suburban Study Circle meeting on “Amendments in the Tax Audit Report”

The Suburban Study Circle organised a meeting on “Important Amendments in the Tax Audit Report for Trusts / NGOs — Form 10B/10BB” on 9th August, 2023, under the leadership of  CA Pankaj Jain.

Making an insightful presentation,  Jain shared his views on the following:

  • An elaborate discussion on various new and complex clause applicability of the respective forms:

1.    Statutory provisions vis-à-vis practical difficulty

2.    Regulatory implications for CA / CS professionals and matters to be included in the audit report

3.    Management responsibility

4.    Compliance checkpoints

5.    Other practical challenges

The session covered numerous real-life examples, with Jain sharing an excellent clause-by-clause interpretation.

4.    Indirect Tax Laws Study Circle case studies on “GST in Automobile Industry”

The Indirect Tax Laws Study Circle presented six case studies on various aspects of GST with reference to clarificatory circulars, provisions of law, judicial pronouncements and embracing technology, and the overall impact of all of these on the automobile sector. Presented by CA Shabd Roop Satsangi, the case studies covered the following aspects:

  • Discounts and Incentives, Reimbursement Claims, Price & Margin Support in the light of Tata Motors Ltd vs. Deputy Commissioner of Commercial Taxes (SPL) – [2023] 150 taxmann.com 382 (SC) & Circular No. 195/07/2023-GST, dated 17th July, 2023

 

  • Issues in supply for repairs undertaken in the state outside the state of registration

 

  • Sale of secondhand vehicles, calculation of margin, understanding the transaction value thereof w.r.t. ancillary services provided

 

  • Blocked credits for demo vehicles whether purchased, leased, supply of ancillaries like stereo, etc., foreign trips or gold coins, etc.

 

  • Taxation of add-on software like speed controllers, boot automation and massage functions at rear seats when opted at different time frames, i.e., after or at the time of supply and payment made to dealer or manufacturer separately.

 

  • Issues of composite supplies, mixed supplies or independent supplies were also discussed as well as valuation principles under 15.

 

  • Change of definition of “SUV” in light of AAAR Maharashtra — Re: Tata Motors Ltd. – order no. MAH/AAAR/SS-RJ/06/2019-20 & Circular No. 195/07/2023-GST, dated 17th July, 2023.

 

  • Pre-GST jurisprudence in the CENVAT Regime, multiple GST AARs, clarificatory circulars, as well as principles held in the case of Mohd. Ekram Khan & Sons (SC) were discussed by the group.

The meeting was held virtually on 3rd August, 2023. Around 68 participants from across India participated in the event mentored by CA Yash Dhadda, discussed the bare law, circulars, AARs and SC decisions. The seminar also presented an interesting segment analysis on the automobile sector.

5.    IESG Meeting on China’s Economy

The International Economics Study Group (IESG) organised a virtual meeting on 1st August, 2023 to discuss “What’s really happening in China”. Chaired by CA Harshad Shah, the meeting noted that Chinese Economy is in turmoil and on the brink of deflation, which can trigger a recession, create a ‘doom loop’ and loss of momentum. This could mean China is headed for a lost decade, similar to Japan in 1990s. China’s property market is in crisis with a bubble situation (the property sector accounting for over 30 per cent of GDP), educated youth unemployment surging to 21.3 per cent (experts suggest it could go to 46.5 per cent), China’s $23 trillion local debt and a massive infrastructure mess about to get worse as cities are on the verge of a debt crisis threatening the stability of the banking system. The meeting also noted that China is facing complex geopolitical and geoeconomical challenges, with the ongoing trade and technology (mainly chips) war turning into Cold War II. China is also facing serious internal challenges with high unemployment, falling income and climate change, which is bringing about extreme weather conditions like floods, drought and heat wave. Its tech titans are losing investors, due to a crackdown by regulators, the collapse of CCP due to challenges it faces on the economic and social front and rare dissent shown by the public. This has resulted in many MNCs relocating their manufacturing from China to India in the China+1 policy.

6.    Indirect Tax Laws Study Circle Meeting on the concept of Taxable Persons

The group leader of the Indirect Tax Study Circle made a virtual presentation on the topic “Casual Taxable Person and Non-resident Taxable Person” on 21st July, 2023. The presentation focused on the legal concept, with multiple case studies addressing the probable practical issues relating to the Casual Taxable Person and Non-Resident Taxable Person. The presentation and discussion broadly covered the intricacies of the following topics:

  • Meaning of Casual Taxable Person

 

  • Situations to identify the events determined as “occasional” as well as the impact of the definition of business, the furtherance of business and supply by itself, ‘supply made from’ position, the impact of identification of supply and clientele prior to the change of location

 

  • Classification for Inter State vs. Intra State w.r.t. to Casual Taxable Person
  • Mandatory registration provisions and situations for service providers were discussed on these aspects of co-work spaces, marketing services, etc.

 

  • Situations covering deemed supplies, ISD mechanism

 

  • Inference of casual taxable person analogy for classification of services

 

  • Non-Resident Taxable Person, its impact and utility

Around 64 participants all over India participated in the discussion.

7.     Direct Tax Laws Study Circle Meeting on intricacies and issues relating to Reassessment

Under the leadership of the speaker, CA Dharan Gandhi, the Direct Tax Laws Study Circle organised a meeting on the topic, “Reassessment under the Income Tax – Law and Practice”. The meeting discussed the following concepts and issues relating to assessment procedures:

  • Concept of Self-Assessment, Assessment, Revision of Assessment and Rectification of Assessment under the Income-tax Act, 1961 (Act)

 

  • New provisions relating to Reassessment, Search and Survey as Introduced by the Finance Act 2021, explaining and comparing the old and new provisions of Section 147 of the Act.

•    Recent Case Laws relating to Section 148:

a.    [2022] 449 ITR 517 (Delhi) Suman Jeet Agarwal vs. ITO

b.    (2022) 329 CTR (Mad) 809 Dr Mathew Cherian & ORS. vs. ACIT

  • Section 148A of the Act relating to conducting an inquiry and providing an opportunity before issuance of a notice under section 148
  • Section 149 of the Act relating to the time limit for notice

By delving into the minute details of these statutory provisions, the speaker shed light on the nuanced procedures and potential pitfalls that arise during the reassessment process. The meeting was held on 14th July, 2023.

8.    Taxation Committee organises a Webinar on Filing of Income Tax Returns for A.Y. 2023-24

A webinar to guide taxpayers on filing their income tax returns (ITR) was taken by CA Divya Jokhakar on 5th July, 2023. The webinar highlighted that the due date for filing returns varies depending on a person’s income and filing status. He can file his returns online or by mail. By following these tips, he can file his income tax return easily and on time. Starting early will give him more time to gather his documents and ensure the accuracy of the returns. Using tax preparation software can help him file his returns quickly and easily. He can also get help from a tax professional. The speaker explained  how A.Y. 2023-24 returns have changed and what precautions are needed to be taken. She further gave examples of disclosures relating to the foreign assets and incomes.

She also emphasised the importance of the various rules in  Income Tax Rules 1962 and the way to compute and disclose in the ITR.

Towards the end, the method of e-verification of the ITR was explained, and it was emphasised that the new rule mentions that one must everify the ITR within 30 days of e-filing.

Visit the below link or scan the QR Code with your phone scanner app:

YouTube Link:  https://www.youtube.com/watch?v=zDsRLnNN_uk

 
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9.    Taxation Committee organises a Seminar on CBDT’s e-Verification Scheme, 2021

A hybrid seminar on CBDT’s e-Verification Scheme, 2021 was organised on 27th June, 2023.

Sunil Kumar Jha, Director of Income Tax (I&CI), Mumbai, broadly explained the important features of the e-Verification Scheme, 2021, and the manner in which the Income-tax department is collecting / collating data and information from multiple sources. He educated the members about the rationale of introducing this scheme and the intention of the department to share the information they have received from sources with the taxpayers.

Nagesh Kale, ITO (I&CI), Mumbai, made a detailed presentation explaining the features and provisions of this scheme. He also shared certain statistics regarding the number of cases selected for e-verification for F.Y. 2019-20 and F.Y. 2020-21.

Sanjay Joseph, CIT, DIT Systems, briefly explained how information collected by the department is displayed on the AIS portal and how the taxpayers are allowed to give a response on the reporting portal. He threw light on the manner of processing the query once a taxpayer provides a response on the reporting portal.

This was followed by a Q&A session wherein Sunil Kumar Jha, DIT (I&CI), and Shri Sanjay Joseph, CIT, addressed the practical issues faced by the taxpayers while responding to e-verification queries and reporting on the AIS portal.

Visit the below link or scan the QR Code with your phone scanner app:

YouTube Link:  https://www.youtube.com/watch?v=MeDGy0mpW88

 
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SOCIETY NEWS

LECTURE MEETING ON ‘OPPORTUNITIES AT GIFT IFSC INCLUDING LATEST BUDGET AMENDMENTS’

A Lecture Meeting to discuss opportunities in GIFT City for professionals and companies was organised on 17th February, 2022.  The meeting, led by presentation made by Mr. Sandip Shah, Head, IFSC Department, GIFT City, Ms. Ketaki Gor Mehta, Partner, Cyril Amarchand Mangaldas, and Mr. Suresh Swamy, Partner, Price Waterhouse & Co. LLP, was aptly handled in the below-mentioned order:a. Overview and Insights into opportunities – Mr. Sandip Shah.b. Legal and Regulatory Framework – Ms. Ketaki Gor Mehta.

c. Tax Framework – Mr. Suresh Swamy.

It was a highly informative session that delved upon the types of businesses that can be conducted within GIFT City, along with an overview of products within each business. The presentations had a takeaway for people from all walks of life, namely businesspeople and professionals. IFSC has grown over the years due to its globally competitive financial platforms, many of which are first in India, e.g. the International Arbitration Center and the International Bullion Exchange. The highlight of the presentation was the explanation of the ‘Sandbox’ approach adopted by GIFT City. This approach allows eligible firms to test their solutions in isolation from the live markets before incorporating them in the mainstream line of services, reflecting the avant-garde approach and progressive mindset of those at the helm of GIFT City.

The session concluded with a Q&A session where participants posed questions that ranged from the types of entities and businesses that can be formed within GIFT City to their nuances, namely currency in which funds can be infused and the tax benefits offered while setting up a unit in GIFT City. The speakers handled the questions with great panache, reflecting their in-depth knowledge and subject-matter expertise.

Youtube Link: https://www.youtube.com/watch?v=kgMLzvtuCfo

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PANEL DISCUSSION ON ‘BUDGET 2022 – THE ECONOMY, TAXATION AND THE CAPITAL MARKETS’

 

The Taxation Committee of the BCAS organized a Panel Discussion on ‘Budget 2022 – The Economy, Taxation and the Capital Markets’ held on 22nd February, 2022. The webinar (held on online platform) and also broadcasted on YouTube was moderated by Ms. Sonal Bhutra.

The session began with an introduction to Budget 2022 by CA Deepak Shah. Post that,CA Abhay Mehta and CA Vishesh Sangoi introduced the audience all three esteemed panelists and the moderator Shariq Contractor, who shared his thoughts on the budget. Mr. Contractor discussed various budget amendments and covered in detail the updated returns with their impact and amendments related to charitable trusts. He also suggested that the changes should not be brought in retrospectively unless absolutely necessary.

Mr. SoumyaKanti Ghosh discussed capital expenditure, fiscal deficit, nominal GDP percentage and the projected growth rate. He shared his thoughts on the multiplier effect and inflation rate.

Mr. Deven Choksey highlighted the three key areas of the budget i.e. Agriculture, Infrastructure and Money. He talked about the long-term impact of the budget and its beneficial effect on growth rates.

The panellists further delved into various specific provisions. The 2-hour session enlightened participants about significant outcomes of the Budget and what it has in store for all.

Youtube Link: https://www.youtube.com/watch?v=3kUxNi6aOGk

 

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VIRTUAL WORKSHOP ON ‘SECRETS TO DEVELOP AN OUTSOURCING PRACTICE’

BCAS’s Technology Committee organized a virtual workshop on ‘Secrets to develop an outsourcing practice’ on 12th March, 2022.The session was led by CA Dhaval Paun, who began the session with a background to India’s outsourcing industry and its potential for Chartered Accountants and other professionals. The session was engaging in a talk and share format with live case studies on how to create effective proposals for outsourcing engagements and the common pitfalls.

CA Dhaval Paun introduced the audience to the various platforms available for outsourcing and shared his years of experience on how professionals can tap, engage and deliver such outsourcing engagements.

The session was highly interactive and the speaker demonstrated:

1.    Myths About Outsourcing Practice.
2.    Skill Alignment for starting Outsourcing Practice.
3.    How to start Outsourcing Practice from your current setup.
4.    Best Freelancing Platform to Start and Why.
5.    Right Strategy to success on Any Outsourcing Channel (Freelancing Platform or otherwise).

Participants learned new avenues of professional services, building on them and achieving success. The speaker answered questions raised by the participants who appreciated the efforts put in by the speaker

Youtube Link: https://www.youtube.com/watch?v=pMWy8eHiBhI
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IESG MEETING– ‘RUSSIA UKRAINE CONFLICT-CAUSES & EFFECTS’

The International Economics Study Group (IESG) conducted a meeting on ‘‘Russia Ukraine Conflict-Causes & Effects’ on 14th March, 2022 to understand the conflict and players. The Study Group discussed the strengths and weaknesses of both Russia and Ukraine.Russia is the largest country in the world by area encompassing an eighth of earth’s inhabitable landmass having the world’s 3rd largest cultivated area, home to over 1,00,000 rivers, has one of the world’s largest surface water resources, extensive mineral and energy resources (world’s largest), boasts of world’s 2nd most powerful military with a million active-duty personnel, about 2–20 million reserve personnel and the world’s largest stockpile of nuclear weapons.

Ukraine is the 2nd largest country by area in Europe, with a population of 43 million, regained its independence in 1991 following the dissolution of the USSR, a developing country with a lower-middle-income economy, has extremely rich and complementary mineral resources, can meet food needs of 600 million people across the world and with a current military of 196,600 active personnel.

Russia-Ukraine War is a “Revenge of Geography” because of its peculiar geography. Russia has felt perpetually insecure for more than five centuries.Geographically Russia is a Eurasian country wherein Ukraine is the pivot state for Putin to anchor Russia in Europe wherein Ukraine’s very independence keeps Russia to a large extent out of Europe but with Ukraine back under Russian domination, Russia adds 43 million people to its own Western-oriented demography, and suddenly challenges Europe. Thus, Putin wants to restore the glory of the erstwhile Soviet Union. Russia says it has no intentions of controlling Ukraine and its military operation is only to “demilitarize” and “de-Nazify” Ukraine in an action taken after 30 years of the US pushing Russia too far as Ukraine wants to become a member of the NATO and Putin used this exact reason to mount military pressure (saying NATO accepting Ukraine as member will endanger Russian safety and sovereignty). Russian military action follows demands made in December 2021 to the US and NATO in the form of treaty proposals that would require: Ukraine and Georgia not to join NATO, US missiles in Poland and Romania to be removed; and NATO deployments to Eastern Europe reversed, which the US and NATO rejected, and hence Putin justifies the invasion.

USA’s apocalyptic “sanctions from hell” narrative has not gone well with many European and other countries. Saudi Crown Prince MBS and the UAE’s Sheikh Zayed declined US requests to speak to Mr. Biden on increasing oil production to compensate for sanctioned Russian oil.

Many western strategic thinkers (Kissinger, John Mearsheimer, Stephen Cohen, Bill Burns and Bob Gates etc.) had warned (in their Books and articles) about the expansion of NATO and the likely reaction in the form of a Russian invasion of Ukraine.

There is an information war being fought by western media and Russians (who are blocked) and we cannot get the true facts.

CA Milan Sanghani presented the impact on Commodities, Gold, Crypto, Debt and Equity Markets.

Group leaders: CA Harshad Shah & CA Milan Sanghani presented points for deliberations to All Group Members

BCAS @ BKH – CERVICAL CANCER AWARENESS & TESTING

Conversations about women’s health are quite the rarity… there is no rocket science behind this… they are ever so busy micromanaging and multitasking at so many levels… who has the time to focus on one’s well-being and health now, right!

In the words of Maya Angelou, “When women take care of their health, they become their own best friend.” And so it was that a small brigade of women from the Core Group Committee of the BCAS (CA Gunja Thakrar, CA Preeti Cherian, and CA Rimple Dedhia) decided that this year, the Women’s Day celebrations would help our members, their family and friends become their besties.

The connect for this event came from our suave Treasurer, CA Anand Bathiya. The Brahamakumaris’ GHRC BSES MG Hospital, Andheri West (BKH) has truly adopted a unique approach to Healthcare as it offers an experience of a mix of modern medicine with a focus on Spirituality – focusing on love, dedication, compassion, cooperation, and cleanliness.

The authorities at BKH suggested having an awareness talk on cervical cancer by the renowned gynaecologist and obstetrician Dr. Meghana Bhagwat. BKH also offered the PAP Smear test and private consult fees with the doctor, at discounted rates to all BCAS members, their family and friends.

With 18+ years of experience, Dr Bhagwat has immense expertise in handling high-risk pregnancies and treating female reproductive issues, especially infertility problems. She works closely with her patients to help them achieve their health goals.

Being the fourth Saturday, 26th March, 2022, was decided. The event started with CA Preeti Cherian welcoming all to the event and briefly introducing the doctor. Brahamakumari Pratibha then led everyone through a 2-minute guided meditation – her soothing voice acting like a balm on the jaded nerves. Chairman of the SPRMD Committee, CA Narayan Pasari, expressed his gratitude to BKH for opening up their facilities to host the event. Managing Committee member CA Kinjal Bhuta and Core Group member CA Sneh Bhuta were present in person to express their support for the event.

Dr Bhagwat spoke in the simplest of terms, underlining the need for women to make their personal gynaec their confidante. Cervical cancer is the second most common form of cancer in Indian women – with India alone accounting for one-quarter of the world’s burden. Most cervical cancer cases are treatable, with regular check-ups crucial for early detection. While cervical cancer is known to affect women in larger numbers, men have also been known to get affected by the virus HPV, which causes cervical cancer.

The doctor also answered questions by both the online attendees and those participating in person. She poignantly revealed that some of her patients visit her only to unburden themselves. Most doctors that one knows seem to be most pressed for time; by revealing her humane side, the doctor won the hearts of all those gathered there and those listening to her online.

In the words of Dadi Janki,

‘Live life fully balanced with your head, heart and hand…
Live life for your good self and for others..
Care.. share.. inspire’

Isn’t this what BCAS abides by? No wonder all of us felt right at home at BKH!

SOCIETY NEWS

‘GST ISSUES RELATING TO INTERMEDIARY’

The Indirect Tax Study Circle of the Bombay Chartered Accountants’ Society arranged its inaugural meeting on ‘GST Issues relating to Intermediary’ on 7th July which was addressed by Group Leader CA Yash Dhadda and Mentored by CA Udayan Chokshi.

CA Yash Dhadda made a detailed presentation on the law and issues relating to Intermediary Services under GST. The presentation broadly covered the following:

(1) Taxability under the erstwhile Service Tax regime;
(2) Definition and Place of Supply provisions under GST;
(3) Current outcome of writ petitions;
(4) Discussion on case studies covering various scenarios.

All the above issues were discussed at length. Mentor CA Udayan Chokshi explained the complexities involved in various scenarios and shared his views on the same. Important case studies and advance rulings were also discussed.

More than 150 participants benefited from the presentation shared by the duo of CA Yash and CA Udayan.

GST INTERPLAY – CUSTOMS, FTP & SEZ

The BCAS Indirect Tax Study Circle arranged a two-day meeting on ‘GST Interplay – Customs, FTP & SEZ’ on 31st July, and 10th August, 2021. It was addressed by Group Leader CA Rishabh Singhvi and Mentored by CA Prashant Deshpande.

CA Rishabh Singhvi made a detailed presentation on the concepts and parameters for differences and similarities between the various indirect tax laws, viz., Customs, GST, FTP and SEZ. Several case studies were drafted by the Group Leader and discussed at length by the participants. The following important issues were discussed:

(i)  Merchant Trade,
(ii) EOU Unit Implications,
(iii) SEZ Unit Implications,
(iv) MOOWR Implications,
(v) Dual Incidence Implications,
(vi) Rule 96(10) issues, and
(vii) FTA Benefits.

Mentor CA Prashant Deshpande guided the group discussion at various stages and shared his expert views on the multiple tax issues involved. Important case studies and advance rulings were also taken up.

CA Jayesh Gogri had mentored and guided the Group Leader in drafting the presentation and the case studies.

The active participation of more than 80 members helped them to benefit from the group discussion.

DEPARTMENTAL AUDIT & ADJUDICATION PROCEDURES

The Indirect Tax Study Circle’s meeting on ‘Case Studies on Department Audit and Adjudication Procedures and Practical Issues’, which was held on 7th August, was addressed by Group Leader CA Keval Shah with CA Rajiv Luthia as Mentor.

Group leader CA Keval Shah had drafted detailed case studies for discussion which covered the following aspects in regard to Department Audit and Adjudication:

(a) Whether the scope of Departmental GST Audit can cover the period under Service Tax;
(b) Partial submission of data within time limit u/s 65(4) of the CGST Act, 2017;
(c) Interest on ineligible input credit availed but not utilised;
(d) Eligibility of ITC claimed in GSTR3B but not reflected in GSTR2A;
(e) GST on purchases from unregistered dealers;
(f) Payment of tax and interest demanded by audit team through utilisation of ITC; and
(g) Eligibility of ITC on delayed payment of GST under the RCM.

Mentor CA Rajiv Luthia guided the group discussion and shared his expert views on the multiple tax issues involved. Important case studies and advance rulings were also discussed. More than 60 participants benefited from the presentation.

SILVER JUBILEE ITF CONFERENCE

 

The Silver Jubilee International Tax and Finance (ITF) Conference, 2021 was conducted online from 12th to 16th August with a record attendance of 474 members from around 36 locations all over India. The total number of participants, including faculties and special invitees, crossed the 500-mark.

In keeping with the tradition of past ITF Conferences, this year’s Conference, too, was designed to include various contemporary and practically relevant topics for the international tax practitioner.

Eminent personalities and experts graced the Conference and shared their invaluable thoughts and experiences on their respective areas of expertise. The five-day Conference was marked by 13 technical sessions, including three group discussion papers, five presentations, three panel discussions (spread over four sessions) and one fire-side chat.

There were a total of 32 members on the faculty, including speakers and session chairmen, 29 group leaders and 19 contributors for case studies and the background material. It clocked over 35 hours of solid study during the Conference.

Facilitating Group Discussions: This year’s ITF had three papers for group discussion written by CA Pinakin Desai, CA Padamchand Khincha and CA Yogesh Thar. The participants were split into six, each group ably led by 29 group leaders (across the three papers) who helped generate in-depth discussion of the case studies from the papers. The paper writers could undertake a virtual tour of each group to follow the discussions by the participants.

Day 1: 12th August

President CA Abhay Mehta gave his opening remarks and explained the BCAS’s activities and its new initiatives. Chairman of the International Taxation Committee Dr. CA Mayur B. Nayak welcomed the participants and made the introductory remarks.

The Conference was inaugurated by the Past Chairman of the International Taxation Committee and the Chairman of the very first ITF Conference, CA Dilip J. Thakkar, with a welcome address. The President of the ICAI, CA Nihar Jambusaria, also addressed the participants. This being the Silver Jubilee Conference, CA Rashmin Sanghvi, Founding Member of the ITF study group, also spoke.

The Keynote Address was delivered by Padma Vibhushan N.R. Narayana Murthy on a very interesting and relevant topic – ‘The role of culture in improving governance in a company’. He laid stress on three key values, namely, ethics, transparency and honesty, for building a sound organisational culture and governance in a company.

As readers would be aware, investment and business activities have substantially increased in the Gujarat International Finance Tec-City (GIFT City) and various regulatory amendments have been made to enhance the lure of GIFT City – India’s first International Financial Services Centre (IFSC). On the first day of the Conference, Advocate Siddharth Shah dealt with ‘GIFT City IFSC – Regulatory and Tax Aspects of Investments and Transactions’ in great detail and explained various complex nuances to the participants. CA Vispi Patel chaired the session and also provided his insights on the subject.

Day 2 – 13th August

The day began with a group discussion on the paper written by CA Pinakin Desai on ‘Controversial Issues Arising from Tax Treaty Interpretation’.

CA Gautam Doshi spoke on ‘Structuring of Family Trusts – FEMA & Other Regulatory Aspects’. He covered various aspects of the subject in great detail, including conceptual explanations, legal and practical points for consideration, provisions of income-tax, FEMA, SEBI and even CRS regulations. Past President CA Dilip J. Thakkar chaired the session and also provided insights on the issues involved.

CA Pinakin Desai, dealing with his paper ‘Controversial Issues Arising from Tax Treaty Interpretation’, for over two and a half hours, highlighted in a detailed but succinct manner various issues such as possibility of access to tax treaty in light of general anti-avoidance rules (GAAR); principal purpose test (PPT) driven by MLI; simplified limitation of benefits provision (SLOB) driven by MLI; and certain select issues of treaty interpretation. Interestingly, CA Pinakin Desai was also a speaker and the Chairman of the International Taxation Committee at the 1st ITF Conference held in 1997 at the Manas Resorts, Igatpuri, Maharashtra. Past President CA Kishor Karia chaired the session and also gave his views on the subject.

The last session of the day was the panel discussion on ‘Experience and Developments in Transfer Pricing’. The panel consisted of CA Vijay Iyer, Dr. CA Hasnain Shroff and CA Kunj Vaidya and was chaired and Moderated by CA T.P. Ostwal.

The panel shared its thoughts and gave insights on specific issues in transfer pricing through case studies. The case studies covered practical issues which would be of relevance in today’s scenario, such as the Covid-19 impact on TP arrangements, APAs for service entities and profit attribution to PE, section 56(2)(X) and TP valuation, impact of secondary adjustment provisions, Covid-19 impact on the manufacturing sector and so on.

Day 3: 14th August

The proceedings started with a group discussion on the paper written by CA Padamchand Khincha on ‘Recent Developments in Taxation of Digital Economy in India’.

Dr. CA Anup Shah spoke on ‘Startups – Tax, FEMA & Regulatory Aspects’ covering various relevant issues such as registration and certification, funding options, exit options and new-age structures, SPACs, Externalisation of Investments and so on. Past President CA Chetan Shah chaired the session and set the ball rolling with his opening remarks.

CA Rashmin Sanghvi, speaking on ‘Future of International Tax Practice and Global Economy’, gave his perspective on the current status of the Indian regulatory system and international tax practice in India. He then described the background of the global events impacting international tax, especially the digital tax war, and provided guidance to professionals on the future of international tax practice. Past President CA Raman Jokhakar chaired the session and offered his perspectives on the topic.

Prior to the fireside chat and panel discussion on taxation of digitised economy, Advocate Mukesh Butani spoke succinctly on Pillar 1 and Pillar 2 of the OECD proposal in the context of taxation of the digitised economy.

In the fireside chat (recorded earlier) on ‘Global Developments in Taxation of Digitised Economy’ with Advocate Mukesh Butani, Mr. Pascal Saint-Amans, Director, Centre for Tax Policy and Administration, OECD, shared his thoughts and gave participants an insight into the potential future of taxation of the digitised economy and what one can expect in the near future. The chat was widely covered by the media in India as well as abroad.

Subsequently, there was a panel discussion on ‘Global Developments in Taxation of Digitised Economy’. The panel consisted of Mr. Carlos Protto, Director of International Tax Relations, Ministry of Economy, Argentina; Mr. Rajat Bansal, a senior IRS official and CCIT; and CA Radhakishan Rawal. It was chaired and Moderated by Advocate Mukesh Butani. The panel covered some of the nuances of the 2-Pillar approach agreed upon by the Inclusive Framework and also gave its views on the future of unilateral measures and Article 12B of the UN Model.

CA Padamchand Khincha, with his paper on ‘Recent Developments in Taxation of Digital Economy in India’, highlighted the various developments in India on the subject, including Significant Economic Presence (SEP), Equalisation Levy (EL), TDS provisions u/s 194-O and taxation of software in light of the recent Supreme Court judgment. Past President CA Rajan Vora chaired the session and gave his valuable inputs on the subject.

Day 4: 15th August

The day began with a group discussion on the paper written by CA Yogesh Thar on ‘Emerging issues in Cross-Border Personal Taxation’.

The first part of the panel discussion on ‘International Taxation – Recent and Emerging Issues and Developments in Law, MCs and Jurisprudence’, was held on Day 4. The panel consisted of Mr. Kamlesh Varshney, IRS and Joint Secretary (TPL) – Finance Ministry, Senior Advocate Ajay Vohra and CA Padamchand Khincha and was chaired and Moderated by CA Pranav Sayta. It was a unique and technically-rich discussion, as the panellists discussed issues from different perspectives.

The issues discussed covered a range of topics of relevance in today’s world – issues related to tax residence of individuals, the applicability of anti-abuse provisions, i.e., GAAR and PPT, availing benefit under the MFN Clause, withholding tax aspects in Multilateral Instrument (MLI), digital currency (classification of income and related issues), Covid-19-related taxation of foreign companies in India, and the term ‘Liable to tax’ and interpretation of Article 3(2).

The frank and thorough exchange of views among the panellists, ably supplemented by the Chairman’s probing queries, made the discussion very interesting and elaborate and provided a lot of food for thought to the participants. The panel discussion was based on case studies prepared by BCAS contributors who also presented their case studies to the participants.

CA Yogesh Thar, while dealing with his paper on ‘Emerging issues in Cross-Border Personal Taxation’, raised interesting points arising from recent developments in personal taxation due to amendments in section 6 relating to residence in India, and Covid-related issues in personal taxation. Past President CA Gautam Nayak chaired the session and also gave his inputs.

The day ended with a special programme, ‘Reminiscences of ITF Journey’ wherein the role of all past Chairmen, coordinators, speakers and contributors of the previous ITF Conferences was recognised, their experiences were relived and their efforts applauded – thus creating an emotional walk down memory lane for all participants. The programme was anchored by Dr. CA Mayur B. Nayak and CA Mayur B. Desai. It was well attended by past contributors and they shared memories of every Conference. CA Jagat Mehta prepared the presentation with details of past Conferences with photographs.

Day 5: 16th August

The second part of the panel discussion on ‘International Taxation – Recent and Emerging Issues and Developments in Law, MCs and Jurisprudence’ (already explained above) was held on Day 5. The frank and thorough exchange of views continued between the panellists, Mr. Kamlesh Varshney, IRS and Joint Secretary (TPL) – Finance Ministry, Senior Advocate Ajay Vohra and CA Padamchand Khincha, ably supplemented by Chairman CA Pranav Sayta’s probing queries.

CA S. Krishnan spoke on ‘Foreign Tax Credit – Practical Aspects and Experience with Case Studies’ covering various issues related to the topic and shared his rich, practical experience. CA Dinesh Kanabar chaired the session and also provided his insights.

Concluding remarks

While the personal touch and the camaraderie amongst participants during past physical Conferences were definitely missed, the participants were hugely enthused by the various sessions. This was the second consecutive ITF Conference held online, wherein delegates participated from their respective places – but thanks to the seamless connectivity, it was one of the most engaging and successful Conferences.

The Silver Jubilee ITF was held under the guidance of the Chairman of the International Taxation Committee Dr. CA Mayur Nayak. CA Abbas Jaorawala as the Chief Conference Director, ably assisted by CA Mahesh Nayak as Joint Conference Director, minutely supervised all the sessions personally and devoted a tremendous amount of time and effort to make it the resounding success that it turned out to be.

Other members of the core team were CA Ganesh Rajgopalan, CA Rutvik Sanghvi, CA Siddharth Banwat, CA Anil Doshi, CA Jagat Mehta, CA Natwar Thakrar, CA Tarunkumar Singhal and CA Rajesh P. Shah. Several others also made laudable contributions of time and effort to make the Conference a landmark event for the BCAS. It ended on a high note and received encouraging response and feedback from the participants.

Proceedings of the Conference can be viewed on YouTube at: https://www.youtube.com/watch?v=HWR2h3f0frg and also via the following QR Code:

 

 ‘LOCAL AND GLOBAL INVESTING’

The BCAS organised a lecture meeting by Mr. Kushal Thaker on ‘Evaluation of Stocks – New Economy vs. Old Economy – Local and Global Investing’ on 18th August.

It was planned with the aim of empowering professionals in understanding evaluation techniques and equipping them with the requisite knowledge as they set out on the road to becoming efficient business advisers.

President CA Abhay Mehta welcomed the participants and offered his remarks on the subject. CA Mihir Sheth introduced the speaker, Mr. Kushal Thaker, who is an astute trader and investor in commodities, equities and currency also known as ‘Specunomist’.

 

 

The speaker explained the concepts relating to various asset classes and their analysis.

Key issues and learnings of the meeting
1. New Economy vs. Old Economy
(a) New Economy: IT sector has experienced quantum leap from .com in 2000 to an apps-based life and now moving to Artificial Intelligence,
(b) Old Economy: Cement to Metal to Mining,
(c) Now, old economy is helping new economy companies by providing raw material and other products that act as inputs for new economy stocks,
(d) To analyse Electric Vehicle Companies, it is important to study the trend of commodities like copper, lithium and nickel. This can be extended to companies undertaking mining of these commodities.

2. Local and Global Investing
(e) Look at stocks beyond the Indian border. It’s likely that India may not have companies listed in that space,
(f) For example, global copper and lithium mining. There are no lithium mining companies listed in India. To take advantage of the upward trend in lithium, investing in global lithium mining would be beneficial.
(g) Never think in terms of defensive stocks. That comes only in a bear market. A bear market scenario in India is unlikely over the next decade.

3. Crude Oil
(h) As crude prices go up, investors usually look to buy oil-producing and oil marketing companies. It will be much better to have globally diversified companies in this space, as Indian companies are either government-controlled or in the small caps space.

4. E-commerce
(i) The pandemic acted as a tailwind for e-commerce. But then there were no e-commerce companies listed in India. Now we have Zomato. So, investing in global e-commerce is profitable as these companies have given mammoth returns during the last one year.

5. Key drivers of growth for the next decade
(j) High tech, new economy, old economy stocks – all supplemented new economy stocks,
(k) Hence one cannot see any bear cycle. Of course, corrections are likely, but only of approximately 10% to 20%, but not a bear market,
(l) A bull market is always going on somewhere in world. So it is not necessary stick to the Indian market,
(m) Be bullish on commodities – gold, silver, steel, rare earth or base metals, natural gas.

6. Beginners into International equity
(n) Internationally, ETF on FAANG returns is lower than the return generated by individual stocks,
(o) Direct investment through brokerage houses – Interactive brokers or Kotak Securities

7. Cryptocurrency
(p) Crypto is an asset class by itself. Each crypto has a role to play. Top 15 cryptos are worth reading against 800 cryptos being available for trading,
(q) SWIFT code is a messaging service between international banks and Indian banks for transfer of forex. SWIFT cannot move fast. But crypto is direct transfer of funds and very fast, too. Crypto-backed services are Ripple and Stellar,
(r) Some cryptos are moving into gaming and bond markets,
(s) India has 11 Crypto platforms and each has its own Crypto (currency). If there are more miners (of Cryptocurrencies), then volatility is going to be very high.

8. IPOs
(t) New IPOs in fintech and logistics companies are good,
(u) Investors should not hesitate from investing in high-growth loss-making companies as long as they don’t foresee any competition coming up in that space,
(v) Also, look into how management is planning for future growth. Many of these new e-commerce and fintech companies have global presence,
(w) If the company has good potential of going into Artificial Intelligence or becoming a Tech Company, supporting fast-growing companies can be considered as good potential investments.

The speaker, Mr. Kushal Thaker, also addressed the queries raised by the participants and shared his thoughts on evaluation techniques for stocks and commodities.

The meeting concluded with a vote of thanks proposed by CA Anand Bathiya to Mr. Kushal Thaker, who addressed the participants from his office in Chicago, USA.

The proceedings of the meeting are available on YouTube at:https://www.youtube.com/watch?v=UDBOMkHCN2E and also on the following QR Code:

 

‘MUMBAI’S COVID PANDEMIC MANAGEMENT MODEL’

The BCAS, along with the Dharma Bharti Mission and the Public Concern for Governance Trust, organised a lecture meeting in memory of the Late Shri Narayan Varma on ‘Mumbai’s Covid Pandemic Management Model’ on 24th August. It was addressed by Mr. Iqbal Singh Chahal, IAS and Commissioner of the BMC. It was held through virtual mode on Zoom platform with live-streaming on YouTube.

 

Ms. Farheen Peshimam started the proceedings and shared a video containing fond memories of the late Shri Narayan Varma with the three associations. She also read a message from the Late Shri Narayan Varma’s Family.

Mr. Paramjeet Singh, President of the Dharma Bharti Mission, delivered the welcome address. He also welcomed the keynote speaker and the three awardees. He gave an insight into the various initiatives taken and the contributions made by the Late Shri Narayan Varma during his lifetime and the impact he made on society and the three organisations at large. Ms Farheen Peshimam then formally introduced Mr. Iqbal Singh Chahal.

Mr. Chahal started by describing the scenario under which he had taken charge of the BMC on 8th May, 2020. Since then, innumerable initiatives had been taken by him and the BMC during the pandemic; he summarised these as follows:

• Systems were created to fight the long war against Covid-19. The model that was created had 27 sub-models to fight the pandemic;
• The model was implemented by dividing Mumbai into 24 war rooms with a real-time dashboard of the Covid-19 cases;
• The approach was a combination of proactive and offensive steps to contain the pandemic at the very start;
• Containment zones were created to chase the virus;
• Sanitization drives were conducted to break the chain of the virus and prevent the multiplication of cases;
• Appointing community leaders in slum areas so as to achieve better coordination;
• Increase spending by BMC on the medical infrastructure and addition of 800 ambulances to fight the virus;
• Distribution of free PPE kits to doctors and medical practitioners;
• A Covid dashboard was created with public and private hospitals and all the reports were managed by a BMC-appointed team of doctors;

• Hospital beds were allotted on the basis of social equality, thereby avoiding a chaotic or panic situation of patients running from one hospital to another;
• Creation of seven Jumbo centres in various parts of the city which were converted into full-fledged greenfield hospitals in record time under the mentorship of top doctors;
• Private hospitals helped by agreeing to cap the rates of beds and other medical facilities which made this a successful public-private partnership;
• Pre-emptive stocking of life-saving medicines at the onset of the second wave proved to be crucial to successfully manage and control the second wave;
• Various campaigns run by BMC to fight Covid-19, like ‘My family, My responsibility’ and ‘No Mask No entry’ to create awareness among the people;
• Initiatives taken to avoid any major mishaps during the oxygen crisis in the second Covid-19 wave and the cyclone faced by Mumbai in the month of May, 2021.

Mr. Chahal shared that the speed of vaccination was quite steady and if this continued, then Mumbai would be spared any major third wave that was likely to hit in October-November, 2021. He lauded the contribution of various NGOs in distribution of food packets and other initiatives. He also responded to the questions from the participants before concluding his session.

To summarise Mr. Chahal’s address, he made some important statements:

1. Let us not be demoralised,
2. We have been chosen by God and given this opportunity to serve humanity,
3. Systems will fight the pandemic and not the individuals, and
4. We have to chase the virus in an offensive manner.

Following this excellent talk, the three Narayan Varma Memorial Awards were announced.

1. The first awardee was Advocate Maharshi Dave, Founder of Sparsh Trust. This Trust was initially founded to help stray dogs in the city, but its principles led them to expand their efforts towards helping both animals and humans.

Giving a brief talk, Mr. Dave emphasised that the foundation believed in the concept of service and empathy. It believed that the more one gave, the more one got. ‘The platform provided by this event is very important for the Trust as it helps in spreading the word about the services that we can provide to many more in need,’ he added.

2. The next awardee was Shri Ravi Singh, Founder of Khalsa Aid International. This is a UK-based humanitarian relief charity that provides aid to people affected by various natural as well as man-made disasters. Even in this pandemic, it was at the forefront and donated planeloads of oxygen cylinders and oxygen concentrators to all parts of India and the world.

3. The third and final awardee was Mr. Ranga Rao, who retired as Assistant Director in the Intelligence Bureau in January, 2010 after 39 years of service. The Late Shri Narayan Varma had encouraged Mr. Rao to learn how to use RTI. Soon, Mr. Rao had started filing RTI applications to address the grievances brought to his attention by poor citizens. The success rates of these applications encouraged his group to start a programme which focused on spreading awareness about the use of RTI to help resolve several issues. Since 2013, Mr. Rao has taught more than 2,000 students all over India the use of the RTI Act to fight corruption.

The meeting ended with a vote of thanks to Mr. Iqbal Singh Chahal proposed by BCAS President CA Abhay Mehta, who officially concluded the meeting.

The lecture is available on YouTube at https://www.youtube.com/watch?v=IgaLf8rqvZs and via QR Code

 

‘GDP & ECONOMIC ANALYSIS – PERSPECTIVE AND IMPORTANCE FOR CAS’

A lecture meeting was organised by the BCAS on ‘GDP & Economic Analysis – Perspective and Importance for CAs’. It was delivered by CA Raj Mullick on 25th August.

 

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The lecture was designed with the aim of empowering professionals in understanding and interpreting economic data and economic indicators, to broaden the horizon for advising and enabling professionals in taking a more holistic view about the way businesses are carried out, and their overall impact on the country at large.

President CA Abhay Mehta welcomed the participants and shared his views on the topic under discussion. CA Chirag Doshi introduced the speaker.

The speaker, CA Raj Mullick, made a detailed presentation on the concepts relating to Gross Domestic Product (GDP) and its analysis. The presentation broadly covered the following:

1. Economy during the pandemic,
2. Micro- and macro-economics,
3. Economy’s income and expenditure,
4. What is GDP?
5. GDP components – (Consumption, Investment, Government spending, Net exports),
6. Real vs. nominal GDP,
7. GDP indicators,
8. Limitation of GDP as a measure of a nation’s well-being,
9. International differences in GDP and quality of life,
10. Saving and investment in national income accounts,
11. Impact of pandemic on the GDP,
12. GDP – Current India @ 2021,
13. GST indicators,
14. Role of Chartered Accountants.

CA Raj Mullick made extensive use of charts, circular flow diagrams and graphics to explain the concept of GDP and so on. He also conducted a quick check of the understanding of the participants by posing practical case studies and eliciting responses on the impact of various situations on the GDP.

The participants took active part by sharing their views on the questions and case studies posed by the speaker. More than 100 persons benefited from the presentation shared by him.

CA Mrinal Mehta proposed the vote of thanks.

The lecture is available on YouTube at https://www.youtube.com/watch?v=_bVuE73LaEk and also via QR code:

AMENDMENTS IN INCOME-TAX ACT, 1961

The Students’ Forum, under the auspices of the BCAS HRD Committee, organised a training session for CA Article Students on ‘Changes in Income-tax Forms and Corresponding Amendments in the Income-tax Act, 1961 for Individuals and HUFs’ on 30th August.

The Study Circle was led by CA Utsav Shah and CA Viren Doshi who are experts on the subject. CA Khubi Shah, the coordinator, introduced the speakers and spoke about the various activities and events conducted by the BCAS Students’ Forum. He encouraged students to actively participate in the events organised by the Forum.
The speakers covered the return-filing process right from the beginning and described in detail the filing of returns on the newly-launched portal using the new utilities introduced. They discussed in detail the section-wise and clause-wise changes and corresponding changes in the return format.

CA Utsav and CA Viren also covered the detailed process and utility walkthrough and guided the students on filing various sections of the form and precautions to be taken to avoid validation error, defective return and demand u/s 143(1). A return-filing checklist was also provided for the benefit of the students.

The session ended with CA Dnyanesh Patade, coordinator, proposing the vote of thanks both to the speakers and to the participants. Around 100 students participated in the interactive session and their feedback was very positive.

The entire session can be viewed on the BCAS YouTube channel at ‘Training Session for CA Article Students – YouTube’ and also via the following QR Code:

 

TREE PLANTATION & EYE CAMP PROJECT 2021

After a gap of one year because of the Covid-19 pandemic, it was time to continue with the decade-old legacy of contributing to the upliftment of tribals and needy persons. The current pandemic has taught us the importance of oxygen, immunity and healthcare.

The HRD Committee under the aegis of the BCAS Foundation organised a two-day visit to Dharampur and Vansda on 25th and 26th September with the objective of caring for nature by planting trees, to provide primary healthcare and quality education to the tribal population, and to help in reaching out to the hitherto neglected people and provide them with timely treatment of cataracts. Thanks to the generosity of our esteemed donors, the BCAS contributed Rs. 7,00,000 for these noble causes.

In view of the current scenario of Covid, a small group of 21 volunteers, representing BCAS on behalf of the donors, got together for the symbolic tree plantation and attended the eye camp. It also visited three NGOs active in the remote villages.

(1) Sarvodaya Parivar Trust (SPT). The group reached Pindval-Dharampur to visit the SPT centre. The trust implements the vision of Acharya Vinoba Bhave of unconditional service to tribals. It works in the fields of environment, education and water conservation and follows a holistic approach for poverty alleviation based on Gandhian principles. The BCAS group interacted with the trustees and volunteers. It also met the children studying at the centre, interacted with them and distributed sweets. The group, along with a team of local farmers, conducted symbolic tree plantation in the fields. It planted mango and bamboo saplings. The BCAS Foundation contributed Rs. 3 lakhs for the plantation of 10,000 trees. Sujataben told them about the activities being conducted by the trust in 35 nearby villages and the challenges faced by them in doing the same. She also explained the outcome of the activities which impacted the life of thousands of residents of the hilly region.

(2) ARCH – Action Research in Community Health, Nagaria. ARCH was founded by the Late Dr. Daxaben Patel to provide basic preventive, curative and maternal-child health services. The Managing Trustees are Mr. Rashmibhai and  Mr. Sudarshan Iyengar, former Vice-Chancellor of Gujarat Vidyapeeth and a leading scholar on Gandhian studies. They and their young and passionate associates took the BCAS team through various innovative teaching techniques for students and their skill development programme, as also the new water-saving techniques used in the plantation. ARCH also conducts mobile health camps in inaccessible villages. The BCAS contributed Rs. 1,50,000 for the triple purposes of tree plantation, skill development and children’s education.

(3) Dhanvantari Trust – Sant Ranchhoddas Eye Hospital Vansda. This body runs an eye hospital which provides free cataract operations and other kinds of eye care for the indigent people. Ghanshyambhai and other trustees described the contribution of the founder trustee, the Late Dr. Kanubhai, in pioneering a 100-bed hospital and that has conducted over 60,000 eye operations with the support of doctors and volunteers who identify patients and arrange for their treatment at Vansda. He explained how ignorance about eye problems because of extreme poverty, misconceptions and so on, result in blindness among the poor. The trustees also talked about the future plans of bettering the facilities, services and upgrading the equipment. The BCAS Foundation contributed Rs. 2,50,000 for the eye camp which performed 250 cataract operations.

 

 

It was a touching experience to see the devotion and selfless service by volunteers for upliftment of the tribal society. All the participants and Trustees expressed their thanks to BCAS for organising the visit to the project sites.

Society News

LEARNING EVENTS AT BCAS

1. Full Day Workshop – “Use of Technology in GST Compliance” held on 9th September, 2023, at BCAS Hall.

The Indirect Taxation Committee jointly with Technology Initiative Committee organised a full day workshop on the use of technology in GST compliance through a demonstration of various automation tools. Automation and use of software in compliance processes can help professionals increase the efficiency of their team and improve compliance.

The 1st session was addressed by CA Jigar Doshi and CA Yash Goenka on strategies for evaluation and selection of automation software and practical challenges in implementation. They explained the checkpoints and important considerations while selecting ERP and ASP / GSP Software.

This was followed by a Panel Discussion on Issues, challenges and areas for automation in GSTR1, GSTR 3B and ITC Reconciliation by use of ASP / GSP Software. The Panel was composed of Darshan Shah and CA Punit Mehta from Tally, CA Aneree Shah from ClearTax and CA Vaishali Dedhia and the panel was moderated by CA Mandar Telang.

The 3rd session was addressed by CA Nachiket Pendharkar who explained the use of VBA and Macros in Excel for preparation of data for GST returns and reconciliation.

CA Rajiv Narayanan explained and demonstrated the use of Robotic Process Automation and Artificial Intelligence tools like Python, Alteryx, Chat GPT and Gamma.app in the 4th and the final session. He emphasised on the increase in efficiency and accuracy of the team by use of RPA and AI.

The event was attended by more than 50 participants and they benefited from the deliberations of the speakers.

2. Half Day Seminar on “Revised Format of Audit Report for Charitable Institutions”, held on 2nd September, 2023, at IMC, Churchgate.

A half-day seminar on Revised Format of Audit Report containing a session explaining the changes made in Form 10B and 10BB applicable for A.Y. 2023–14 followed by a Panel Discussion was organised by the Taxation Committee in a hybrid mode.

CA Sonalee Godbole explained Form 10B clause-wise with a break-up of the details being called by the auditor. She explained the care to be taken while reporting the information and the risks associated with incorrect or incomplete reporting and how the auditor is responsible for the entire reporting to the Income-tax Department.

At the time of the panel discussion — clause-wise questions and answers were undertaken by CA Anil Sathe and CA Gautam Nayak. They cited the decisions of the courts and tribunals which helped the participants to understand the coverage of the revised forms.

The seminar ended with a Q&A session with the participants. The seminar was attended by over 425 participants physically and online.

Representation dated 11th September, 2023, requesting the deferment of the applicability of the revised form 10B / 10 BB (Audit report for Charitable Trusts) by one year.

Based on the various aspects discussed in the said seminar, the Society, with the help of Taxation Committee, also made a representation to the Hon’ble Finance Minister on 11th September, 2023, expressing concerns over complex coverage of the forms vis-a-vis machinery and resources available with the assessees (viz. charitable / non-profit organisations) to compile the details and information called for in the said forms. The Society therefore requested the deferment of the revised forms for a period of one year and continuance of the old forms for the time being.

To read the Representation, Scan the QR code on the following page:

[Editor’s Note: Vide Circular No. 16/2023, dated 18th September, 2023 the CBDT has extended the due date for furnishing Audit Reports in form 10B/Form10BB for the A.Y. 2023–24 from 30th September, 2023, to 31st October, 2023]

3. “Forensic Accounting and Investigation Standards (FAIS)” event held on Friday, 1st September, 2023, at Hotel Parle International.

The ICAI has recently issued revised Forensic Accounting and Investigation Standards (FAIS). These standards have now become mandatory for all the engagements conducted on or after 1st July, 2023. Internal Audit Committee organised this seminar to enlighten the participants about the framework governing these revised standards, the basic concepts covered in the standards, legal framework and report writing. The seminar received a good response, particularly from young participants who want to foray into the field of forensic audits.

The seminar was divided into four sessions followed by a panel discussion. The faculty for the sessions were part of the Expert committee of ICAI which was involved in the standard-setting process and hence they had good insights on the topic. CA Satish Shenoy, in his key-note address, spoke about the need for FAIS, governing framework and professional opportunities for CAs. CA Nikunj Shah, in the first technical session discussed various concepts across FAIS. This was followed by discussion about its relevance and recognition and the extent of reliance on the work of the professionals in legal world which was taken by CA Uday Kulkarni. Lastly, CA Chetan Dalal shared his practical experiences, recent cases and discussed a few tips about the report writing. The seminar ended with a panel discussion between all the three technical session experts and interaction with the participants in Q&A form which was guided by CA Ashutosh Pednekar. All speakers were very lucid and they made the sessions very interesting and engaging with lots of examples.

Link for downloading the standards:  https://resource.cdn.icai.org/75009daab030723.pdf

4. Direct Tax Laws Study Circle on “Key changes under TCS provisions” on 1st September, 2023, in Online Mode.

The study circle meeting was led by CA Chaitee Londhe wherein the participants discussed the following points:

• Amended Provisions of Section 206C(1G) of the Income-tax Act, 1961 and her analysis of the same.

• Overview of the Amendments introduced to the TCS provisions by the Finance Act, 2023.

• Subsequent changes were introduced to the TCS provisions by way of Circular No. 10/2023.

• Amended Provisions of Section 206CC and 206CCA of the Income-tax Act, 1961.

• Amendments introduced in the Liberalised Remittance Scheme of RBI.

• Clarifications issued by the CBDT with respect to the amended TCS provisions.

The speaker delivered a comprehensive analysis and insightful perspective on the amended TCS provisions, offering invaluable clarity by dissecting the CBDT’s issued clarifications.

5. Panel Discussion on “Investing in India’s AmritKaal: Equities and beyond” held on Friday, 25th August, 2023, in Online Mode.

In a dynamic financial landscape, the event “Amrit Kaal” organised by the Managing Committee shed light on the shifting paradigms of investment. The speakers Mr Kushal Thaker, Mr Aditya Sood, and CA Vikas Khemani meticulously navigated through the evolving asset classes, emphasising how Alternative Investment Funds (AIFs), Commodities, Portfolio Management Services (PMS), and even Sovereign Gold Bonds are carving distinctive realms within the investment spectrum. These unconventional avenues, once ancillary, are now emerging as robust investment classes, offering diversification and new avenues for wealth creation.

A pivotal theme of the event was the transformation in India’s macroeconomic landscape. The speakers illuminated how India’s economic trajectory has witnessed notable shifts over recent years, reshaping the investment narrative. Insights were shared on the changing dynamics of growth, inflation, fiscal policies, and global positioning, offering attendees a comprehensive view of the macroeconomic trends shaping investment decisions.

Of paramount significance was the discourse around equity investments. The event unpacked how equity, as an enduring asset class, is extending its allure to new entrants in the market. With insightful discussions on long-term strategies, risk management, and the role of technology, attendees gained a profound understanding of the opportunities and challenges that equity investments present, not only for seasoned investors but also for those embarking on their investment journey.

Throughout the event, the resonating message was the need for adaptability. The financial landscape is no longer static; it’s a dynamic ecosystem where traditional norms are being redefined. The event encapsulated the essence of embracing change, whether by exploring diverse asset classes, decoding macroeconomic shifts, or embracing equity investments as a transformative force.

The panel discussion was guided by CA Abhay Mehta who moderated the session.

Link for watching the session: https://www.youtube.com/watch?v=0xs5frO6kdo

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6. Direct Tax Laws Study Circle meeting on “Reassessment under the Income-tax Act — Law and Practice” held on Thursday, 24th August, 2023, via Zoom.

Dharan Gandhi took up Part 2 of the meeting on the topic of Reassessment under the Income-tax Act — Law and Practice, wherein he discussed the following concepts and issues relating to the assessment procedures:

• Section 150 of the Income-tax Act, 1961 relating to cases where assessment is in pursuance of an order on appeal.

• Section 151 of the Income-tax Act, 1961 relating to Sanctions for issue of notices by the specified authority for the purposes of Section 148 and Section 148A.

• Procedure for reassessment under the new provisions in Search and Non-Search Cases, and Search Cases of a third-party including steps, approval and time period relating to the same.

• Relevant Case Laws on Section 148 and 148A of the Income-tax Act, 1961.

• Analysis and views of various courts on notices issued at different points in time.

The speaker conducted a thorough examination of the recently established reassessment provisions, clearing not only their intricacies but also delving into the diverse perspectives presented by various courts in response to the raised issues during the reassessment proceedings. The session concluded with a vote of thanks.

7. Direct Tax Laws Study Circle meeting on Issues with respect to “Deductions under Capital Gains” held on Friday, 18th August, 2023, in Online Mode.

The study circle meeting was led by CA Shashank Mehta in which the participants discussed various issues w.r.t. allowability of deductions under capital gains, with the help of Case Studies. The following concepts were covered:
• Cost of Acquisition with respect to section 55 of the Income-tax Act, 1961 (Act).

• Eligible exemption as per section 54F read with section 50C of the Act.

• Cost of acquisition in case of House Property where the entire amount of Interest is not allowed as a deduction u/s 24(b) of the Act.

• Eligible Indexation as per section 48 of the Act.

• The criteria to be fulfilled for claiming exemption as per section 54, section 54EC, section 54F of the Act.

• Deduction under section 54 in case investment in new house property is not purchased in the name of the Assessee.

The group leader provided a comprehensive breakdown of capital gains deductions, citing case studies and case laws to illustrate allowable deductions and exemptions shedding light on important concepts.

8. BCAS’s Social Cause Visit to Umargaon: “Nurturing Education and Nature” on 5th and 6th August, 2023.

As one of the initiatives of the Managing Committee, in a remarkable display of community spirit, BCAS & BCAS Foundation orchestrated a two-day event that combined the power of education and environmental stewardship. A group of 27 dedicated volunteers participated in the social cause visit at Umargaon.

The event kicked off with a Social Cause visit to schools helped by the BCAS Foundation in collaboration with the Rushabh Foundation which took on the admirable responsibility of providing education infrastructure in 25 schools, through the introduction of Digital Classrooms. These schools overcame the challenge of teacher shortages and ignited a newfound enthusiasm for learning. Witnessing the astonishing results achieved in just six months was nothing short of awe-inspiring. BCAS has assured its support to ensure quality education for all. The team played indoor and outdoor games, fostering an atmosphere of joy and inclusivity.

As planned, the team visited Bhaskar Save’s Natural Farm, “Kalpavruksha”. Revered as the ‘Father of Natural Farming’ in India, Bhaskar Save and his successors illuminated the principles of Natural Abundance. Exploring the dichotomy between Natural and Organic Farming, the team learned how the farmer aligns with the fundamental principle of cooperation inherent in nature itself. The five critical concerns of farming — Tillage, Fertility Inputs, Weeding, Irrigation, and Crop Protection — were elegantly addressed through nature’s intricate balance. Bhaskar Save’s conviction that “Non-violence is only possible through natural farming” resonated deeply, a testament to the harmony that can be achieved through sustainable practices.

 

On the subsequent day, the group ventured to the proposed land of the MaBap Foundation. The four pillars of the foundation are PrakrutikChikitsa (Natural Healing), SanskrutikVikas (Cultural Development), Vedic Abhyas (Vedic Practices), and AdhyatmikUnnati (Spiritual Progress), through which the foundation embodies holistic growth. The significance of PanchTatva (Five Elements)

in every facet of existence was highlighted, setting the tone for a symbolic tree-planting ceremony. Excitement and enthusiasm rippled through the group as they planted Ashopalav, Neem, Mango, Jamun, and Saru trees, marking a significant stride towards BCAS’s 75th year.

The group treasured enriching memories and returned with an enlightening experience of profound learning, gratitude, and an unshakable belief in the power of concerted efforts to create a better world.

9. A Panel Discussion on “Disclosure of Foreign Assets and Incomes” held on 26th July, 2023, in Online Mode.

The Taxation Committee organised a Panel Discussion on Disclosures of Foreign Incomes and Assets in a virtual mode. The Panel consisted of CA RutvikSanghavi, CA KartikBadiani, and CA Mahesh Nayak who co-authored the book on “Disclosures of Foreign Assets and Incomes” published by BCAS.

CA Hardik Mehta moderated the session addressing various questions to each of the panelists bringing out comprehensive responses from each Panelist.

CA Rutvik Sanghavi explained the importance and objective and the rationale behind the enactment. He also stressed on the principles one needs to keep in mind while reporting the same. He also explained the importance of the documentation for reporting the foreign assets and income. He also briefly touched upon reporting of gifts, ESOPs, etc. The issue of mismatches was also explained and how to mitigate the same with proper documentation.

CA Kartik Badiani answered questions with respect to reporting in the foreign asset schedules including the impact of change in residential status, reporting by minors, reporting of joint holding of house properties, investments in Gift City etc. He also took the case study of ESOPs and its reporting issues.

CA Mahesh Nayak took the participants through the case study of overseas brokerage accounts and how to report the same. He also explained as to which cases will be covered in subparts A1 to A4 and others in B of the FA Schedule.

All three panelists touched upon various other issues involving the FA schedule and what each subpart intends to cover. They even explained the issue regarding the easy availability of foreign exchange rates for reporting., the issue of calendar year vs. financial year etc. The panel discussion was very well received and appreciated the insights shared by all three panelists.

Link to access the space session:  https://www.youtube.com/watch?v=dXoApEdvwnw

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10. A Twitter Space Session on “Filing ITR for A.Y. 2023–24” held on 4th July, 2023, in Online Mode.

This Twitter Space Session on filing ITR for A.Y. 2023–24 was organised by the Technology Initiative Committee, with an objective of sharing the crucial precautions and best practices for filing ITR that professionals need to observe.

In a candid discussion that was moderated by the chairman of the committee, CA Ameet Patel, the speakers, CA Nitin Shinghala, CA Sanjeev Lalan, and CA Rajni Shah, shared insights on the dos and don’ts for tax professionals to ensure a hassle-free tax filing experience.

The session was open to all and got an encouraging response as several non-members, including representatives from the media attended the same.

SOCIETY NEWS

CAs PERFORM ‘Zumba’ exercises

The BCAS decided on a unique theme for the monthly HRD Study Circle meeting with the idea of giving members a break from their strenuous routine of managing office and work from home. A ‘Zumba’ class was the choice. This is an exercise fitness programme that combines international music with dance moves. Zumba routines incorporate interval training – alternating fast and slow rhythms to help cardiovascular fitness.

Organised on 8th December, 2020, the event featured faculty and trainer Mr. Burzin Engineer, who is a professional dancer and a fitness coach with over a decade’s experience. He started the class with light warm-up exercises to get everybody ready for a fun workout. The Zumba moves he picked were easy and the movements had a flow which the 50-plus participants thoroughly enjoyed. Amongst the participants were members of the Committee and BCAS members from Mumbai, Pune, Ahmedabad, Indore, Chennai, Delhi, Kolkata, Jodhpur and even Chicago.

Regular physical exercise / activity keeps the body fit and the mind refreshed. It was motivating to see some of the senior members participate with great enthusiasm. This session also offered some quality family time to members. Many children were seen enjoying exercising and moving to the beats of the music along with their parents.

‘RESIDENTIAL REFRESHER COURSE’

One of the most awaited events of the year, the ‘Youth Residential Refresher Course’, organised by the HRD Committee of the BCAS, saw its 8th run from 16th to 18th April, 2021.

The event was held under the aegis of the BCAS with support from President CA Suhas Paranjpe, HRD Committee Chairman CA Govind Goyal, mentor CA Naushad Panjwani and HRD Convener CA Anand Kothari. On account of the second wave of Covid-19, the event was conducted online but over 100 participants joined from 24 cities all over India.

A vast range of topics was covered over 12 sessions extending to 16 hours over a three-day virtual refresher course.

Going by the YRCC theme of ‘Re-Align | Re-Energize | Re-Connect’, the event had thought-provoking sessions by some excellent international guest speakers who gave meaningful and fascinating insights into the changing work culture, the new emerging technologies, the intricacies of the professional world and how one must adapt to them.

The technical sessions were followed by networking sessions wherein some special online networking activities were organised for the participants.

Part I – Speaker Sessions

The first day covered interesting topics ranging from ‘Journey of an Entrepreneur’, ‘Professional Social Responsibility – A Tool for Networking’ to ‘Why Indian Professionals are a Darling of Global Corporates’. An interesting fireside chat with young ‘technopreneurs’  came with the key takeaway of understanding one’s strengths and weaknesses and then tackling all obstacles on the road to achieving our dreams.

In the next session, Mr. Shailesh Haribhakti shared insights about life experiences, the importance of reading books and giving back to the society as a professional. The final topic had the speaker sharing success stories of Indian professionals abroad and their attitude and approach towards work, their talents, and the ‘Do’s and Don’ts’ that we should adopt in our professional journey.

The second day began with an early morning session on ‘Work Culture: Friendships at Workplace’. The speaker dwelt on the necessity of maintaining cordial and friendly relations at the workplace and threw light on where to draw the line. She answered multiple questions on work-life balance. The following session was a dialogue ‘Acing Appraisals’ with industry veterans where the participants learned the importance of timely appraisals and the key elements to use in their next appraisal meet.

Later during the day, there was an engaging session on ‘Building Social Media Presence within the ICAI Guidelines’. ‘Social Media’ is a wide spectrum of networking opportunities. The speaker guided the participants on the ethics to be followed when building a social media presence and seeking new opportunities. (What, how, when and related questions arising in our everyday life.)

The next panel on ‘Emerging Trends in the Financial World’ brought new thoughts on how blockchain, cryptocurrency and Artificial Intelligence will revolutionise the practice around us. Their impact on our work culture and strategies and our professional approach were also mentioned. The day ended with some fun, relaxation and rejuvenation for the family through a stand-up comedy session.

The final day at YRRC began with the interesting and relevant topic, ‘Kya WFH mein koi locha hai?’. It was one of the most relatable sessions for the participants, dealing with the importance of mental health in a world of increasing technology and diminishing human interface. The next topic, ‘Upgrading to a Global Outlook and Approach’, made the participants ponder over whether they need to change their traditional approach to meet global standards. If yes, then to what level, extent and with what mindset, was highlighted by the speaker. This was followed by an interesting panel discussion by the YRRC conveners and coordinators about their intriguing journey and success stories providing guidance on how to build a successful career while reminiscing old memories.

The final session could not have been more perfect. There was an excellent motivating and persuasive address by ICAI President CA Nihar Jambusaria to the youth, enlightening them about different aspects of the profession.

Part II – Networking Sessions

All the participants belonging to different areas and regions had connected over Zoom meetings to be part of our ‘Networking sessions’ which were held after the speaker sessions ended. The participants were divided into six different teams to compete over the team-building activities organised by the YRRC team along with another fraternity member, CA Hrudyesh Pankhania.

To begin with, the participants were given multiple group tasks to perform and were then required to send the screenshot of the tasks performed. This gave them a chance to display their swiftness and coordination by sending their screenshots at the earliest.

One of the most creative activities given was composing your own song or modifying an existing song to accommodate the names of your team members in the lyrics. Not just that, the participants were even required to give a live performance. The final results were mind-blowing with fantastic innovation and compositions by the teams.

The participants also got a chance to display their artistic skills when they had to virtually draw a painting together (team spirit) and make it as realistic as possible. And how about shuffling the team members and asking them to choose their favourite celebrities (from the list given) whom they would save from a fire, and also come up with some hilarious reasons for the same? The choices had to be as unique as possible, because, after all, success lies in being different.

The final event of the ‘Networking Session’ was the ‘Networking People’s Tambola’ which required all the participants to network within cross-teams and make Tambola tickets. Of course, the best part was creating ‘Memes’ – for the YRCC, of the YRCC and by the YRCC. Kudos to all the participants who came up with some splendid and creative memes which left each and every one of them in splits.

Our Wall of Fame – Our Valued Speakers


Behind the Scenes – The YRRC Team

 

YRRC Participants at the Networking Sessions

 

ITF STUDY CIRCLE MEETING

The International Taxation Committee conducted a virtual meeting on ‘Residence of Individual under Income-tax Act – Recap on interpretation issues dealt by Courts and impact of new amendments’ on 24th May. It was led by Group Leader CA Hardik Mehta who explained the concepts with respect to residence of an Individual under the Indian Income-tax Act along with recent developments and interpretations made by Courts.

Determining an Individual’s residence status is one of the most important factors based on which taxability is decided. In view of this, the Group Leader walked the audience through the Income-tax Act, its amendments and various court rulings in relation to the residence of an Individual. With the help of several simplified illustrations, the speakers lucidly explained the various concepts. They also dealt with and resolved queries raised by the participants. The meeting was interactive and the participants benefited enormously from the discussions and insights provided.

A SWOT ANALYSIS OF CHINA

The International Economics Study Group held its meeting on 9th June to take up a ‘SWOT Analysis of China in the context of likely Cold War II’. CAs Harshad Shah and Deepak Karanth led the discussion and presented their views on the subject.

The participating experts warned that the two world powers were entering dangerous territory. Tensions are mounting by the day between the United States and China, leading to possibilities of a new Cold War. It resembles the US-Soviet ‘Cold War’ in certain respects and the group analysed this through a SWOT analysis. They said that what’s at stake is the future of the 21st century global order.

China’s strengths are economics, military firepower (it is the third largest defence power in the world), its own Google, Facebook, WhatsApp, Amazon – and thus technologically it is not dependent on the US.

China’s opportunities are a huge population with rising per capita income, a huge consumer base, lower dependence on exports, healthcare and education.

China’s weaknesses are dwindling cheap labour, demographic crisis (birthrate @ 1.3), Communism, governance issues, suppression of Uyghur Muslims, lack of innovation and basic research, a ‘Hungry for Money’ attitude, its military’s lack of actual war experience for 42 years, the brain-drain problem, extreme rural poverty, few English-speaking people and a huge pollution problem.

China’s threats are no protection of IPRs and blatant violations, Taiwan becoming the ‘Berlin’ of the Sino-American Cold War, China’s serious border disputes with most of its neighbours, South China Sea dispute (this can spark the next global conflict), looming debt crisis, not all of China’s investment decisions having been successful, China could be facing a food crisis and also a water crisis, possibility of civil war, a foreign policy that is in the gutter and its post-pandemic reputation crisis.

Later, CA Milan Sangani presented his views on the ‘State of the Indian Economy in relation to the second wave of Covid-19’. Compared to the GDP hit in F.Y. 2021, the impact of the second wave of lockdowns is expected to be less. And there was light at the end of the tunnel as the number of new cases was now lower than the number of recoveries. Vaccinations needed ramping up and real interest rates had turned negative, hurting fixed income investors with increasing inflation. He noted that historically, global non-financial disruptions like pandemics and World Wars are followed by periods of economic boom.

SOCIETY NEWS

BALANCING ONE’S STATE OF MIND

The Human Resources Development Study Circle arranged an excellent discussion on one of the most important topics requiring to be explained in detail in these devastating Covid times, viz., ‘Sthitapradnya’ (a state of balanced intellect in which one is not perturbed by emotions). This is a valued part of the Bhagwad Geeta. The presentation was made by the veteran CA C.N. Vaze in the course of a virtual (online) meeting on 11th May. It was followed by a brief talk by Ms Manasi Amdekar, counselling psychologist, who dwelt on the role of prayers in achieving ‘Sthitapradnya’.

C.N. Vaze explained that ‘Sthitapradnya’ or a balanced state of mind makes it possible for us to pursue our goals irrespective of our situation. Today, because of Covid and the resultant lockdowns there is a lot of negativity and depression leading to severe mental problems. The talk was aimed at generating positivity in the participants by focusing on the following qualities of ‘Sthitapradnya’:

1. Becoming desireless: Being fully satisfied with the self.
2. Stability in every situation: Such a person is stable (not shaken by whatever condition he is in, not too ambitious but not complacent either, and will work for growth but not be perturbed by negative results).
3. Emotional stability: Neither pleased with good nor angry at bad (evil).
4. Complete self-control.
5. Tranquility: Established in calmness of the mind.
6. Established in fullness: Undisturbed by desires, just as the ocean is undisturbed by the constant flow of rivers into it.
7. Oneness with Brahman.

‘In Indian culture, we use two words, Sukh which is material comfort, and Anand which is happiness and which depends on one’s mental state,’ C.N. Vaze pointed out.

यः सरत््व रानभिस्नेहस्तत्तत्प्राप्य शुभा शुभम।्
नाभिनन्दति न द्वेष्टि तस्य प्रज्ञा प्रतिष्ठिता।।2.57।।

• His Reason is (said to be) steady whose Mind is without Attachment in all things, and who feels no exultation or aversion about the agreeable or disagreeable which befalls him.
यदा संहरते चायं कूर्मोऽङ्गानीव सर्वशः।
इन्द् रियाणीन्द् रियार्थेभ्यस्तस्य प्रज्ञा प्रतिष्ठिता।।2.58।।

• When a person draws in (his) senses from the objects of senses as the tortoise draws in its limbs (such as hands, feet, etc.) from all sides, then his Reason is (said to be) steady.The discussion then turned to Shad Ripu (the six ‘Enemies of Life’), viz.,

• Kaama – Desire
• Krodha – Anger
• Lobha – Greed
• Moha – Delusion
• Mada – Ego
• Matsara – Jealousy

C.N. Vaze concluded by quoting Swami Vivekananda who had exhorted Indians to ‘Arise, awake and do not stop until the goal is reached.’

He was followed by Ms Manasi Amdekar who focused on the role of prayers to achieve ‘Sthitapradnya’.

Among the points that she discussed were:

* The brain has different ‘phases’. It reacts to stimuli, and prayers can help in controlling it;
* Words affect water, too. Good words create ripples of good designs and bad language can create distorted designs. These affect the happenings in a person’s life; water molecules react to words and their vibrations; when we utter words of gratitude, there are beautiful, symmetrical patterns in water;
* Non-living objects also react to frequency and can change their position;
* Our brains behave differently depending on what we speak;
* Chanting religious mantras – Actively listening to what you are saying is important, they are holy words and have an effect on your mind; in fact, we dedicate time for them;
* Most people are in a chaotic state with so much noise around;
* We need to filter out other noise and give focused attention to the desired stimulus;
* Active and passive listening are crucial; we cannot move our outer ears, but we can still avoid distractions and concentrate our minds on the job we are doing.

The participants in the virtual meeting requested that both the speakers, C.N. Vaze and Ms Manasi Amdekar, be invited to speak once again as they found the sessions to be interesting and enlightening.

15TH RESIDENTIAL STUDY COURSE ON GST

When the country was grappling with the Covid pandemic and almost the whole of India came to a standstill owing to the ‘second wave’ which started in March, 2021, the BCAS organised its 15th Residential Study Course on Goods and Services Tax in an attempt to motivate people and offer them continuous study in such difficult times.

However, the course was held in virtual mode between 3rd and 6th June. It was well designed and planned. Proof of this was the fact that it was attended by 390 participants from all over India.

There were more than 45 live mega case studies. Each case study was unique in its own way and dwelt on several issues that the professionals and the taxpayers face every day. This time, a new concept, that of a MOCK group discussion, was planned in advance wherein the Group Leaders and Mentors were invited to participate in two ‘GD Papers’ and two ‘Panel Papers’. Before the actual event, selected Group Leaders were allotted the case studies which generated active participation all around and acted as a precursor to the main event. The Group Leaders presented their views first with slides on the case studies allotted to them and other members in the close group deliberated and added their viewpoints. After the Mock group discussion, a Common PPT was prepared for all the Group Leaders for the RSC group discussions. The outcome of this Mock discussion was excellent and offered a lot of value to the participants. All the Paper writers, faculties and panellists appreciated the idea of the Mock GD and the Common PPT.

On the first evening, 3rd June, the programme started at 4.45 pm. CA Sunil Gabhawalla, Chairman, Indirect Tax Committee (IDTC), welcomed the participants and shared the idea behind the RSC, the technical efforts and its design. This was followed by inaugural remarks by President CA Suhas Paranjpe, who gave a briefing on the BCAS. IDTC member CA Mrinal Mehta introduced the panellists, Advocate V. Sridharan, CA S.S. Gupta and Moderator Sunil Gabhawalla.

The panel discussion on ‘Case Studies on GST Law’ lasted about three hours. The concluding remarks were also made by Sunil Gabhawalla and the vote of thanks was proposed by CA Saurabh Shah, the IDTV Convener.

The morning of 4th June had Sunil Gabhawalla welcoming the participants for the Group discussion on ‘ITC – Myth or Reality’? The paper was written by Advocate V. Raghuraman. After the introduction of the Group Leaders and the Mentors and acknowledging their efforts, the Group discussion commenced. For every Group discussion paper, the participants were divided into ten online groups, each with a Group Leader and a Mentor. After the Group discussions, the Group Leaders and Mentors reported to the Paper Writer about the groups’ views, probable issues and challenges during the course of the discussion.

In the evening session, the opening remarks were made by IDTC senior member CA Puloma Dalal, the session chairperson. Following this, the speaker was introduced by CA Gaurav Save, IDTC member. Advocate Raghuraman, Faculty, presented his replies to the Paper that had been discussed in the morning. The participants enjoyed the free flow from the Paper presenter. The session concluded with a vote of thanks by CA Vikram Mehta, IDTC member.

The proceedings of the third day, 5th June, began with the Group discussion on ‘Corporate Restructuring & GST’, the Paper written by CA Gautam Doshi and CA Bhavna Doshi. In-depth discussions took place among all the ten groups. After the Group discussions, reporting to the Paper Writers was done as planned by all the Group Leaders and Mentors.

In the evening, the opening remarks were made by IDTC senior member and Past President, CA Govind Goyal, chairman of this technical session. CA Parth Shah, IDTC member, introduced the speakers. The Faculties then presented their replies to the Paper that had been discussed in the morning. The session was well appreciated for the simple solutions from the procedural and legal perspectives and for the practical solutions. It concluded with a vote of thanks proposed by CA Dushyant Bhatt, IDTC convener.

The concluding day, 6th June, saw two sessions. The first was chaired by CA Raman Jokhakar, Past President of the BCAS. After his opening remarks, CA Rishabh Singhvi, IDTC member, introduced CA Divyesh Lapsiwala, the speaker of the Presentation Paper ‘Tax Technology – Current and Future Trends’. The speaker explained the importance of technology adoption in GST practice and starting preparations in advance. Later, the chairman gave the concluding remarks and the vote of thanks was proposed by CA Suresh Choudhary, also an IDTC member.

After a break of five minutes, the last technical session on ‘GST Practice’ with the panellists, senior advocate Tarun Gulati and CA Sushil Solanki, commenced. The session was moderated by CA A.R. Krishnan, senior member of the IDTC. The concluding remarks were made by Sunil Gabhawalla, IDTC chairman, and the vote of thanks was proposed by CA Mandar Telang, IDTC convener.

Owing to time constraints, a few case studies could not be covered but, considering the importance of the topics concerned, the said session was carried over to 22nd June. The participants benefited from the valuable inputs, legal discussions and analysis of the GST law. Sunil Gabhawalla thanked both the panellists and the Moderator for their time and effort and also for agreeing to the extended session.

The virtual RSC concluded with acknowledgements and thanks to all those who had worked towards making the event a success, especially the Paper Writers, Group Leaders, Mentors, Panellists and others who had worked tirelessly to deliver a seamless experience. Last but not the least, thanks were expressed to the participants without whom the sessions would not have been so interactive.

Overall, it was an enriching experience and was appreciated by all the participants.

CREATING AND SUSTAINING TEAM CULTURE

The Human Resource Development Study Circle arranged a meeting on the virtual platform of BCAS on 8th June to discuss the subject ‘Creating & Sustaining a Team Culture (Introductory Session)’. It was addressed by Mr. Gopal Sehjpal.

Creating a new team culture or improving upon an existing team culture is about answering the question: ‘Do you play well with others?’

The answer to this could lead to one’s success or failure as a leader. It could be the key factor in one’s personal and family relationships. Many think that ‘plays well with others’ is a category for grading school children, not grown-ups. ‘We tell ourselves, “I’m a successful, confident adult. I shouldn’t have to constantly monitor if I’m being nice or if people like me.”’

Most people hold themselves blameless for any inter-personal friction and believe that it’s always someone else’s fault not their own fault. They say, ‘The other guy needs to change. I shouldn’t have to. In fact, I don’t need to, it’s his fault.’

Mr. Gopal Sehjpal wondered whether people are so satisfied with how far their behaviour has already taken them in life that they smugly reject any reason to change? In other words, they believe that ‘If it ain’t broke, don’t fix it.’

He narrated the story of Alan Mullaly who, when he became CEO of Ford, set to work to create an environment where the executive team, notorious for not working together, could learn to play well with each other. Through his leadership, the focus of the team, and ultimately of the entire company, became ‘How can we help one another more?’ It worked. The company survived through incredibly difficult times and returned to achieving great success again through working together. If Ford had been a schoolyard and the executives school children, they would have received the highest marks in ‘playing well with others’.

How well does your team play together?

Mr. Gopal Sehjpal said that one could answer this question about one’s team by trying the simple, four-step process which can be called ‘team-building without time-wasting.’ The steps are:

1. In a team meeting, ask each team member to rate ‘How well are we doing?’ vs. ‘How well do we need to be doing?’ in terms of teamwork. Have each member do this on paper. Have one of the members calculate the scores without identifying anyone. On a 1-10 scale, with 10 being the highest score, the average evaluation from over 1,000 teams is ‘We are a 5.8. We need to be an 8.7.’

2. Assuming that there is a gap between ‘we are’ and ‘we need to be,’ ask each team member to list two key behaviours that if every other individual team member improved, could help close the gap and improve teamwork. Do not mention people, only behaviour, such as listening better, clear goals, etc. Then list the behaviours on a flip chart and have the team pick the one that they believe will have the biggest impact.

3. Have each team member conduct a three-minute, one-on-one meeting with each of the other team members. (Do this while standing and rotate as members become available.) In these sessions, each person should ask, ‘Please suggest one or two positive changes I can make individually to help our team work together more effectively.’ Then have each person pick one behaviour to focus on improving.

4. Begin a regular monthly follow-up process in which each team member asks each other member for suggestions on how to continue their improvement based on their behaviour the previous month. The conversations should focus on the specific areas identified for improvement individually as well as general suggestions for how to be better team members.

When asking for inputs, the rules are that the person receiving the ideas cannot judge or critique the ideas. He must just listen and say ‘Thank you.’ The person giving the ideas must focus on the future, not the past.

Mr. Gopal Sehjpal said this is a quick and easy process that helps teams improve and helps team members become better team players.

‘We hope this is helpful to you and those around you. Life is good.’

For goals of the organisation to be met, he suggested: 1) Creating teams, 2) Team culture. Sustaining a team culture is an independent task with a view to ensuring that teams function to achieve the goals of the organisation.

Any defect in the system of creating teams will be harmful to the organisation. The process involves: 1) Creating teams, 2) Assessment of each team member, and 3) Overall assessment of team performance – Feedback, feedforward, differentials are also important aspects to sustain team performance and achievement of the organisation’s goal, Mr. Gopal Sehjpal added.

FOREIGN DIRECT INVESTMENT

The FEMA Study Circle conducted a virtual knowledge session on ‘Foreign Direct Investment (FDI)’ on 19th June to help provide working knowledge about FDI to members of the Study Circle. The discussion was led by Group Leader CA Mukesh Dhoot who explained key provisions of FDI along with the applicable regulatory framework on it.

Mukesh Dhoot led the discussion by comparing the current regulatory framework with the erstwhile FERA 1973 and by highlighting the differences in their objectives. Apart from this comparison, various key provisions such as capital and current transactions, pricing guidelines, sectoral caps, prohibited sectors, KYC, minimum lock-in period, etc., were also taken up. Multiple case studies based on practical aspects of FDI were also discussed. Group Leader Mukesh Dhoot also encouraged the participants to share their responses / inputs.

It was an enlightening discussion with senior members discussing practical examples and approaches in relation to the subject. Several seniors and members of the BCAS FEMA Study Circle also participated in the discussion and their participation made it more interesting.

DIRECT TAX LAWS STUDY CIRCLE

The Direct Tax Laws Study Circle organised a virtual meeting on 21st June at which ‘Key Amendments Related to TDS Provisions, Effective 1st July, 2021’ were taken up.

Group Leader CA Bhaumik Goda gave a brief overview of the changing TDS landscape. The provisions of section 194Q were discussed in depth with illustrations. The applicability of TDS on GST was taken up in light of judicial precedents and Circulars. Further, the exemptions to such TDS provisions were also highlighted.

Thereafter, the Study Circle discussed the inter-play between the TDS and TCS provisions with illustrations. Also discussed was the TDS impact on non-filers of ITR. The session ended with Bhaumik Goda sharing his thoughts on the practical challenges that will be faced during implementation of the new TDS provisions.

INTERNATIONAL DAY OF YOGA: 21ST JUNE

The Human Resource Development Committee, along with The Yoga Institute, Santacruz East, organised an online programme to mark the International Day of Yoga on 21st June from 8 am to 9.45 am. The programme was conducted by CA Manoj Alimchandani along with CA Neeta Bakshi, Ms Manju Khatri, Ms Naznin Hussein and Ms Hital Shah making up the faculty.

Chairman CA Govind Goyal welcomed the gathering which was then addressed by President Suhas Paranjpe and Vice-President CA Abhay Mehta. Ms Naznin Hussein spoke at length on food, nutrition and precautions. She captioned her presentation ‘Ahar, Vihar, Achaar, Vichar.’

She spoke about sattvik, rajasik and tamasik food with slides and suggested that one should choose sattvik food, with a gap of four hours between two meals. Breakfast must be taken within one hour of waking up. There must be a gap of four hours between meals and it would be best to eat 40% less than the actual appetite. The last meal of the day should be not later than 7 pm. She also spoke about the value of gratitude and prayer, as well as sunlight and exercise.

Ms Hital Shah demonstrated the way to perform Suryanamaskar. Ms Manju Khatri showed how to perform Talaasan, Utkatasan, Sukhasan, Vajrasan and neck and shoulder-relaxing postures. Ms Nita Bakshi explained the importance of pranayam and warm water and suggested that everyone should practice this in the current pandemic for better health.

The programme was anchored by CA Anand Kothari and the Q&A session by CA Mukesh Trivedi. About 60 participants took part in it.

CRYPTOCURRENCY: THE FUTURE OF MONEY?

The BCAS organised a lecture meeting by Mr. Nishith Desai on ‘Is cryptocurrency the future of money? Challenges and complexities’ on 23rd June. It was planned keeping in mind the current trend of money exchanges and the related challenges and complexities. Mr. Desai, along with his team comprising Mr. Suril Desai, Mr. Meyyappan Nagappan, Mr Vaibhav Parikh and Mr. Purushotham Kittane, took the participants through the entire gamut of cryptocurrency (crypto).

 

The role of Moderator was played by CA Ninad Karpe, who set the ball rolling by stating that there were many mysteries surrounding cryptocurrency and the technology used in it. He was confident that the meeting would help solve some of the mysteries regarding crypto as the future of money.

Mr. Nishith Desai introduced the topic and provided his insight on the crypto market and its development globally and in India. He also explained the history of the evolution of crypto and the legal tussle between crypto and banks. He noted that there was a Supreme Court order stating that crypto could not be banned. At the same time, it was true that some countries considered crypto as money, while some treated it as security.

Mr. Suril Desai recalled the history of crypto and noted that it was during the recession of 2008 that the concept paper for crypto came in; however, history states that the first blog on Bitcon was issued in January, 2003. The real pick-up in crypto came after the 2008 recession. Blockchain technology, on which the entire system of crypto was based, was nothing but a shared distribution ledger system which was available on multiple systems or notes and was considered to be very secure, unlike a centralised system where a single attack could bring down the entire system. Bitcoin was programmable money. Currently, the Bitcoin world was limited to 21 million coins but this limit could be changed with the approval of more than 51% of the holders.

Next, Mr. Vaibhav Parikh shared his thoughts on the Indian legal landscape and the opportunity in the technology world related to remittances. There was a big market for blockchain developers. One could not separate public blockchain and crypto, although one could separate private blockchain and crypto. He also described how blockchain will change the way the finance industry worked. In his talk, he covered the Supreme Court judgment on whether crypto was legal or not, the relevance of the FEMA Act, the Payment and Settlement Act, the Security Contract Regulation Act, 1956, FDI, the Prevention of Money Laundering Act, the Companies Act and other subjects.

For his part, Mr Meyyappan Nagappan covered the taxation aspects of crypto. He explained that from the taxation perspective its classification could be in three categories, namely, goods, property or currency. There were also issues regarding whether it was a capital asset vs. a stock-in-trade. He broadly covered the topics related to Significant Economic Presence (SEP), Income attributable to SEP taxable in India, Risk in case of non-treaty jurisdictions, Equalisation Levy (EL), tax base for levy of EL, Withholding Tax Obligation of crypto exchange and Tax Collection / Deduction at Source.

Indirect tax aspects related to crypto, such as did sale of crypto constitute supply? Is a crypto exchange an intermediary under the IGST Act? Is the sale of crypto to a resident buyer import of goods? Or is the sale of crypto to a non-resident buyer export of goods? Tax Collected at Source (TCS), registration requirements, these were some of the other areas covered by him.

Mr. Purushotham Kittane explained the RBI’s stand and its Circular related to crypto and the emphasis that RBI has put on KYC norms, prevention of money laundering laws and combatting of terrorism funding. There were several developments on the policy level by the Government of India. RBI had also proposed its own cryptocurrency as a centralised currency for the country. Ninad Karpe summarised the session by posing some very relevant questions to the speakers based on his own research and the questions asked by the participants on the chat and Q&A box.

The meeting attracted a large number of participants. It concluded with CA Mihir Sheth proposing the vote of thanks. An archival video of the meeting has, in a short time, garnered a few thousand views. It can be viewed on the following YouTube link: https://www.youtube.com/watch?v=iO1aNXusAp4&t=6s&ab

LEADERSHIP RETREAT

The last programme of the society for the year 2020-21 was organised by the Human Resource Committee on 29th June, 2021. The regular Leadership Camp was not organised owing to the lockdown; and in view of the prevailing situation an online presentation was arranged on the topic ‘Creating a High Performing Organisation’. The distinguished faculty was Prof. Dr. Zubin Mulla, who has been a regular on the BCAS platform. More than 160 participants attended the programme.

It commenced with a welcome address by Chairman CA Govind Goyal, followed by talks by President Suhas Paranjpe and Vice-President Abhay Mehta. CA Krishankumar Jhunjhunwala introduced the speaker.

Dr. Mulla discussed the following important points:

• Correct human resource practice and good leadership followed by employees, operations and customer outcome create a high-performing organisation. Employees display skills and competencies, with job satisfaction and commitment and have good behaviour to contribute. On the other hand, customer satisfaction creates loyalty and productivity brings good operational outcome.
• What are HR practices? The speaker shared an acronym ‘AMO’, for Ability-enhancing, Motivation and Opportunity.
• Ability and skill-enhancing practices should come with a comprehensive scientific recruitment policy, rigorous selection criteria and extensive training. Motivation can be enhanced with developmental performance management, competitive compensation, giving incentives and rewards and creating career prospects with job security. The opportunity can be enhanced with a flexible job design, creating right teams, information-sharing and employee involvement and psychological safety.
• How to select the appropriate candidate? The speaker emphasised that the top five drivers that the employee looks at are attractive salary, work-life balance, job security, pleasant work atmosphere and career progression. The top five resources for getting applicants were job portals, placement agencies, referrals, social media and company websites. Before recruiting, one must identify employee segments, create an employer brand and identify the appropriate channel.

There must be a robust selection process.

• Dr. Mulla emphasised that even though paying a high salary is the easiest way to get the employee, it is not the most scientific approach and in the long run it becomes counter-productive. However, performance incentive is an excellent way to attract and motivate the employees and high performers. Employers must focus on human capital as per the requirements of the organisation. Human capital is the value of the employee in the organisation.
• While discussing the concept of human capital, the speaker explained that it would pay to look at the value of the employee in the organisation irrespective of his value in the general market. Once an employee is selected on the firm’s capital value, he should be shown the path of growth within the firm and also explained what quality of behaviour is expected of him.
• The speaker advised that it was best to design the job in such a way that is inherently motivating, based on skill variety, task variety, autonomy and giving an opportunity to the employee to give feedback. The vision of the supervisor should be wider compared to the subordinate. The authority and responsibility of the manager should be commensurate.
Dr. Mulla said ‘AMO’ must work together as per the needs of the business. He also discussed a case study of one of the most valuable placement service companies, Egonzender, which has the following process:

1.    Understand client’s situation
2.    Confirm proposal and specification
3.    Conduct systematic research
4.    Interview potential candidate
5.    Present candidate and check references
6.    Assist in negotiation and follow-up.

Egonzender’s philosophy was to hire consultants who:

  •     have little interest in personal aggrandisement
  •     are team players
  •     get more pleasure from group’s success and their own advancement
  •     are collaborative
  •     eagerly share ideas and information about existing and potential clients
  •     share information about the candidate who may fit the best needs of the client
  •     wants to stay long with a company.

The reward strategy emerges from the business strategy and must be aligned with all elements of HR.

In the second part of the presentation, the discussion was on leadership.

•    Three ways of getting work done are authority, transaction and leadership.
•    Leader has to have clarity of purpose and he must walk the talk.
•    Leaders take responsibility and share success.
•    Leaders help others to find purpose at work by engaging them in the pursuit of a higher vision.

Dr. Mulla suggested two books for reading: Investing in People by Wayne F. Cascio, John W. Boudreau, Alexis A. Fink; The Servant: A Simple story about the true essence of Leadership by James C. Hunter.

After the presentation CA Mukesh Trivedi conducted the Q&A session and proposed the vote of thanks.

FOUNDING DAY LECTURE BY  AZIM PREMJI

On 6th July, the 73rd Founding Day of the BCAS,  Mr. Azim Premji addressed the members on ‘Professional Excellence and Social Responsibilities’. He complimented the BCAS for its ability to reinvent itself over 72 years and stated that professional excellence and social responsibilities were not separate but were interlinked in many ways.

Elaborating, he said, both required focus, execution and trust of the stakeholders. Considering the complexities of a country as diverse as India, bringing about social change was more difficult than running a big business. Hence, it was absolutely essential to partner with the Government institutions and build the right professional environment and execution capabilities in philanthropy. Professional excellence with good execution skills would help build the right ethos of social responsibilities that, in turn, would create a sustainable society.

After his very brief talk, Mr. Premji engaged in a conversation with CA Naushad Panjwani in the course of which he addressed several questions.

Asked about his inspiration, he said it was his mother and also Mahatma Gandhi who had inspired him to follow the concept of trusteeship of wealth. This was the driving force that made his Foundation commit more than Rs. 1,000 crores to help the people affected by Covid-19. At the same time, he pointed out, his biggest regret was that he did not start on his journey of philanthropy earlier in life. He advised the youth of the country to engage with the real world and work in the field to experience the injustice, inequity and hardship that the common man has to face. This will help them develop empathy.

Mr. Premji apprised members about the various social initiatives in the areas of education, agriculture and poultry-farming that his Foundation had been engaged in and said that these had helped generate employment for 83 lakh people.

What was his opinion about the best structure for a philanthropic organisation? His view was that no form or structure would work unless one collaborated with the Government institutions which alone had the wherewithal to ensure that the benefits percolated down to the ground level. The Government institutions have to be convinced of the intent and the capability of the organisation.

What would be the best way to take up the issue of education which had suffered the most during and after the Covid pandemic? Mr. Premji advocated mohalla classes in open spaces, proper vaccination of the teachers and also financial and infrastructure support to them.

How could the inequality in income be reduced? For that, he said, it was necessary to improve the level of public education – but the entire thrust of development should be on the common man as the beneficiary. No one could be emotionally detached from misery; after all, empathy to other human beings is the core of human existence.

Addressing the impact of Covid-19 on the IT industry,  Mr. Premji said that the IT industry was quick to ‘rethink’ and ‘reshape’ against the challenges and had adopted the hybrid model to find optimal balance. It was this ability that could help India become the IT hub of the world and also help the country reach the target of becoming a US $5 trillion economy. In fact, the IT industry had added 1,58,000 new jobs during the pandemic year.

What were the secrets behind his company’s ability to manage the ethics and values across various cultures where his business had a presence? His reply was that it had been through a process of ‘communicate’, ‘demonstrate’ and ‘enforce (when violated)’ that it had been made possible.

In the course of his personal journey and his experience after over five decades in business, Mr. Premji said his best learning experience had come from people on the ground, teachers, students, workers, etc. That had helped him to evolve.

CA Abhay Mehta proposed the vote of thanks and added that as a token of appreciation to the esteemed guest, BCAS has sponsored 101 trees to be planted across the country.

The lecture meeting can be viewed on the following YouTube link: https://www.youtube.com/watch?v=x46zwWVPZk8&t=135s

Society News

LEARNING EVENTS AT BCAS

 

  1. MEETING ON COMPANY LAW: SCHEDULE III AND CARO

On 7th April, 2023, the Students Forum under the auspices of the HRD Committee organised a virtual’ Students’ Study Circle meeting on the topic “Company Law: Schedule III and CARO”.

In her presentation, CA Nidhi Patade, explained the Schedule III and applicability. The main focus of the session was on the disclosure aspects under the schedule and challenges thereon.

Under the guidance of the mentor CA Vijay Gajaria, important disclosures requirement such as Benami Properties disclosure, promoters’ shareholding, property plant and equipment, trade payable, etc. were discussed in detail along with format and examples.

Applicability of CARO 2020, its applicability and clauses were also discussed with a CARO report for better understanding of students.

The interactive session also addressed the questions raised by the participants.

The Students’ Study Circle program is designed in a way to train students under the guidance of the Mentor.

Youtube Link: https://www.youtube.com/watch?v=zlFlrOxniWk

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  1. Suburban Study Circle Meeting on “Analysis of Section 45(4) and 9B of Income Tax Act, 1961”

Suburban Study Circle Meetings on “Analysis of Section 45(4) and 9B of Income Tax Act, 1961”, held in two parts, were addressed by CA Upamanyu Manjrekar as a Group Leader and chaired by CA Amit Sawant.

  1. Manjrekar made an insightful presentation with inputs from Sawant and shared his views on the following:
  • Applicability of Section 45(4) and 9B
  • Comparative analysis of erstwhile Section 45(4), new Section 9B and Section 45(4)
  • Case studies illustrating operation of provisions
  • Interpretational issues such as determination of nature of capital gains
  • Insightful discussion on Supreme Court case of ‘The Commissioner of Income Tax vs. M/s. Mansukh Dyeing and Printing Mills’
  • Process to be followed in case of double taxability
  • Supreme Court judgment on applicability of Section 45(4) of the Income Tax Act in cases of subsisting partners of a partnership, transferring the assets in favor of a retiring partner.

The session was knowledgeable, practical and all the points were very well covered with numerous case studies to make it simpler for the group.

Both sessions had wonderful interactive participation from the group. Large number of queries from the participants were satisfactorily addressed by CA. Manjrekar. The participants also benefited from the elaborate presentation shared by the group leader.

 

  1. XIITH RESIDENTIAL STUDY COURSE ON IND AS

The Accounting and Auditing Committee of the BCAS organised the XIIth Residential Study Course (RSC) on Ind AS (in physical mode) at The Dukes Retreat, Khandala which was attended by 66 participants from across India.

Welcoming the participants, CA Mihir Sheth, President, BCAS mentioned that the topics selected for the RSC were of great importance to the accounting and auditing fraternity and requested the participants to derive the maximum benefits. He concluded by giving his best wishes for the success of the RSC.

In his opening remarks, CA Manish Sampat, Chairman, Accounting and Auditing Committee traced the history of the previous RRCs and gave a broad overview of the structure and topics selected for the current RSC and thought process behind the same.

The RSC comprised three engaging papers for Group discussion along with two interesting presentation papers and an excellent Panel discussion.

The paper for group discussions comprised following topics:

  • Case studies on the Intricate issues of Ind As Standards across Industries
  • Case Studies on Consolidated Financial Statements (Ind AS 110) and Business Combinations (Ind AS 103)
  • Case Studies on Intricacies in Financial Instruments (Ind AS 32 and Ind AS 109)

Presentation Papers comprised following topics:

  • Recent Development in Global Reporting Framework
  • ESG- Concepts and Reporting

A Panel discussion was organized on:

Preparing for Regulatory Challenges and Managing Stakeholders’ expectations in Auditing. The Panel discussion gave the perspective from the viewpoint of Auditors, Audit Committee Representative and the Industry. It was very well moderated to generate interesting discussion.

The Auditor perspective was shared by CA Ashutosh Pednekar. The Audit Committee perspective was represented by CA Sanjay Khemani while the industry perspective was shared by CA Raj Mullick. The session was moderated by CA Raman Jokhakar.

Other speakers at the event included CA Dr. Anand Banka, CA Parag Kulkarni, CA Sarvesh Warty, CA Himanshu Kishnadwala and CA Raj Mullick.

The RSC concluded with closing remarks by the Chairman. He thanked all those who contributed to making the RSC a grand success. He also invited some of the participants to share their experience of the RSC and feedback.

  1. WORKSHOP ON APPROACH TO LITIGATION UNDER GST

The Indirect Tax Committee organised a full day workshop on “Approach to Litigation under GST” covering the entire gamut of litigation under GST. The workshop received 190 registrations (109 members and 81 non-members). 70 participants attended physically while 113 attended virtually.

The tone of the session was set by the key-note address delivered by Vipin Jain, Advocate by sharing important anecdotes from the experience he encountered during his legal carrier.

In the first technical session, Mr Deepak Mata, Dy. Commissioner explained how Department using AI/ML through different softwares obtains various data to identify instances of tax evasion and takes necessary actions. The inputs from Mr Mata gave an insight to the participants as to how the Department receives information from various sources, such as the income tax department, MCA, fast-tag, etc., to unearth tax-evasion and helped them understand the need to be careful while advising clients keeping various aspects in mind.

In the second technical session, Rinkey Jassuja, Advocate explained the provisions relating to notices under section 73 & 74, taking the audience through the necessary provisions, and explaining the ingredients which are necessary for a valid SCN and points to be captured while responding to the SCN.

The third session was addressed by CA. S S Gupta who gave the participants an insight into the appeal provisions, including pre-deposit and instances when a taxpayer should opt for writ route to get relief from High Court. He also dealt with the provisions related to condonation of delay and the importance of timely filing of appeal.

In the last session, Vinay Jain, Advocate, took up live case studies on various issues faced by businesses, such as GSTR-3B vs. GSTR-2A mismatch, circular trading, taxability of leasehold rights, cross-charge, etc.

  1. INDIRECT TAX LAWS STUDY CIRCLE MEETING ON ISSUES IN REPORTING

The group leader of the Indirect Tax Study Circle, CA Deepali Mehta conducted a meeting to discuss seven case studies addressing the practical issues in reporting vis-à-vis turnover for applicability of turnover for e-Invoice, and other practical issues in e-Way Bills and e-Invoices. The presentation and discussion broadly covered the intricacies on the following topics:

  1. Determination of turnover for e-Invoice while considering the specific transactions of WDV as per the Income Tax Act.
  1. Procedural lapse in the generation of e-Invoice and subsequent issues of credit eligibility, applicability of penalties thereon, if any
  1. Turnover issues for considering e-Invoicing when part of the services are exempted from generating e-Invoices
  1. Expiry of e-Way bill due to technical issue of conveyance like flat tyre, engine break down, etc. Penalty was paid under DRC-03 but whether same can be appealed later on to recover the same to prove the bonafide or any other remedy available to the registered person.

Determination of Jurisdiction against confiscation orders of goods in transit, whether in source state, destination state or transit state.

Issue of multiple e-Way bill in a single transaction of transshipment, whether updations will suffice or if PO is cancelled by recipient during the transit, then the issues emanating out of the same.

80 participants from all over India took an active part in the threadbare discussion on the seven detailed case studies and issues discussed with reference to various clarificatory circulars, jurisprudence including recent judgment in relation to Karanatak VAT for similar factors of tax invoice and collective discussion.

  1. HRD STUDY CIRCLE MEETING ON LIFE AND BREATH

The HRD Committee of the Study Circle organised a hybrid meeting on the topic ‘Life and Breath’ on 14th March, 2023, by Shri Pravin Mankar.

The discussion at the meeting revolved around the thought: ‘Life itself is the most wonderful fairy tale. Do we really live? Are we aware of our Breath? Are we conscious of our breathing and breathing habits?’

Listed Below a few points/glimpses from the teaching imparted at the meeting:

  1. Pneuma, Breath of Life, is the natural life of the body.
  1. CA’s got interested in this subject because health is very important to be able to function physically.
  1. A fundamental law: debit the receiver and credit the giver.
  1. Life is about how to balance in order to be successful.
  1. Following important terms were discussed at the meeting:
  1. a) We are not aware of how much we receive.
  1. b) Who is receiving, who is giving, we are receiving, Universe is giving. If I receive more and give less or if I give more and receive less, there will be an imbalance.
  1. c) Give and Take is the law of life. We cannot keep receiving, we have to learn to give also. You can’t even take a breath without giving out breath. Try to continuously inhale.
  1. d) Law is the existence of a condition irrespective of circumstances.
  1. e) Life – Dharma. Be clear of what you collect, you can give away what you collect. If you collect goodies you can give them out, if you collect rubbish, that’s what you’ll be able to give out to the society.
  1. f) Karma follows the law of Cause and Effect or reap as you sow.
  1. g) Dharma is the purpose for which you were born. Most of us don’t know why we were born.
  1. h) Disease is being ill at ease, physically or mentally.

Explore these points and correlate to life and breath.

Youtube Link: https://www.youtube.com/watch?v=ofgTAk0UXxo

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  1. WORKSHOP ON PRACTICAL ASPECTS OF AUDIT FOR SME PRACTITIONERS

A two-day hybrid workshop was held from 10th and 11th March, 2023 at the BCAS auditorium to comprehensively deal with various important and practical aspects of auditing for SME entities. The aim of workshop was to help SME practitioners improve the overall quality of audit, avoid pitfalls and make them aware of certain important aspects in audit. The workshop was attended by 35 participants in person and other 18 participants through virtual mode.

The workshop started with the topic: ‘Standards on Auditing – Practical aspects and important considerations SQC-1, AQMM. CA Rajesh Mody covered overall Audit Strategy and touched upon important SAs based on his more than 25 years of experience in identifying and assessing the Risk of Material Misstatements (ROMMS) by being aware to sniff the red flags and respond to the same to obtain Sufficient and Appropriate Audit Evidences (SAAE) in order to arrive at the conclusion for opining on the true and fairness of Financial Statement. He also covered briefly the SQC-1 and AQMM besides answering the queries raised by the participants.

The next session was on ‘Practical Challenges – CARO Reporting’ by CA Tejas Parikh. The speaker touched upon important 8- 10 items in CARO reporting and dealt with peculiar aspects of those items and how the auditors have dealt with and reported the same in the 2022 audited accounts based on the Published Results of listed entities.

After lunch, the third session on FRRB/QRB Observations on Financial Statements, Learnings from NFRA Orders on Audit Reviews, Procedures, and Documentation commenced. Moderated by CA Amit Purohit, the session aimed to  create awareness amongst the participants to realize the importance of complying with the SA and avoid the pitfalls as observed by NFRA, FRRB and QRB.

The last session was on practical aspects on SA-320 Materiality determination, SA-315, SA-330 – Risk Assessment and Auditors response, SA-450 – Evaluation of misstatements identified during Audit by CA Nikhil Patel. The standards covered were the most fundamental and the backbone of all quality audits.

The day two of the workshop began with the SAs covering all reporting aspects of audit including SA-700 series on Audit Conclusions and Reporting and SA-265 – Communicating deficiencies on Internal Control evaluation by CA Ajit Vishwanath. He dealt with all the reporting standards very lucidly and explained important considerations with practical examples. His session was well received by the participants.

The next session SA-530 – Audit sampling, SA- 300 Planning an Audit, SA-230 Audit Documentation and peer review readiness was moderated by CA Harshvardhan Dossa. He explained provisions with real life case studies besides demonstrating how the samples are derived, the Audit Program, how the things are documented and the real folder management.. The participants appreciated the session.

Post lunch the session was on SA 520 – Analytical Procedures and use of Technology in Conducting Audit by CA Gautam Shah. The speaker demonstrated how simple tools like excel can be used to carry out various kinds of analysis to identify the red flags and outliers and then carry out audit procedures to obtain SAAE to derive quality results. He also demonstrated many real life case studies wherein he had used the analysis and arrived at quality samples for minimizing the risk of material misstatement (ROMM). He also named few specialised software for the benefit of the participants. The last session of two days’ workshop was on use of Tally features for conducting an effective Audit by CA Anand Paurana. The speaker demonstrated on live tally data and explained the features available in Tally ERP which can help auditor execute certain important audit procedures and derive meaningful samples for conducting quality audit thereby minimizing the ROMM. He also answered the issue raised by the participants.

The two-day workshop concluded with vote of thanks.

  1. WORKSHOP ON PENALTIES UNDER INCOME TAX ACT 1961

The Taxation Committee organised a Workshop on Penalties under Income Tax Act 1961. The Workshop was divided into two parts. The first part of the workshop was held on 19th January 2023 and the second on 27th January, 2023.

The speaker of the Workshop, CA Jagdish Punjabi educated the participants about the recent
amendments made in the penalty provisions. He gave an overview of the provisions of sections 271AAC, 271AAD, 271D, 271DA, 271E, 271J and sections 270A, 270AA, 273B.

  1. Jagdish Punjabi highlighted the distinctive features between the erstwhile penal provisions and the amended penal provisions. He pointed out various technical issues in the erstwhile penal provisions which have been plugged in the new provisions.

The speaker further enlightened the participants about various points which one needs to keep in mind while replying to notices issued for levying penalty under various provisions.

The workshop got an overwhelming response.

Society News

LEARNING EVENTS AT BCAS

  1. POWER SUMMIT 2023 BY THE HRD COMMITTEE

Human Resource Development Committee organised a two-day residential program “The Power Summit 2023” on the 3rd and 4th March, 2023 at the Byke Suraj Plaza, Mumbai. This was the sixth season of the Power Summit with the first one being held in 2011.

Attended by 67 participants, the Power Summit had 13 eminent faculties. The program was curated and anchored by a team of three faculty members, CA Nandita Parekh, CA Ameet Patel, and CA Vaibhav Manek.

The benefits of holding the program in a residential format were truly reaped and cherished by the participants. They not only got added networking opportunities, but also a chance to have casual interactions with some of the faculties present during the entire duration of the program.

The topics of discussion at the Power Summit were selected to give momentum to the growth of the practicing firms. The summit aimed to help the participants develop and frame strategies to capitalise on the growth opportunities stirred up by the World Congress of Accountants held in Mumbai in November 2022.

The presentations by the faculties over the two days were creative, intriguing, and intertwined in such a way that all the participants returned home with good food for thought, and zeal to walk forward on the growth trajectory.

The program on Day 1 started with a session by CA Dinesh Kanabar, CA Jayesh Sanghrajka, and CA Vaibhav Manek on the importance of brand building for practicing CA firms with insights on how the same can be achieved.

In the next session, CA Druman Patel gave insights on how new-edge technologies like Artificial Intelligence would impact the profession. He also focused on the opportunities that these technologies open up for the CAs.

Thereafter, CA Vaibhav Manek and CA Nandita Parekh led an interesting discussion on the importance of capital in CA firms for growth, and the ways and options to exist.

 

CA Ajay Sethi, CA Arpit Jain, and CA Chetan Shah shared some of their strategies to navigate through road and mind blocks faced during their journeys over thee years.

On Day 2, CA Nitin Shingala talked about his desires he had during the early years of his career. Participants were also recommended several useful books read by the speaker in the past.

 

CA Rajat Dutta and Anu Chaudhary explained about the new and alternative service areas for CA firms including services around inheritance, succession planning, and ESG. Both speakers captivated the audience with their respective oratory styles as well as the contents of their talks.

 

CA Nikunj Shah explained how CA firms can use various technology-based tools in their day-to-day practice to improve their service offerings.

Three of the participating firms presented their mock pitch for possible merger and acquisition opportunities before the senior faculty members. The feedback shared by the faculty members helped all the participants.

The program ended with CA Vaibhav Manek, CA Ameet Patel, and CA Nandita Parekh sharing practical ways in which a firm should build up its strategic plan.

The interest of the participants was evident in terms of the involved discussions and the large number of questions raised during and after each session, and also during the casual networking interactions.

  1. SEMINAR ON BRAND Building Professional on Zoom

A seminar on ‘’Building a Professional and Personal Brand for Professionals,’ was held on 2nd March, 2023 on Zoom.

Led by speaker, CA Pankaj Mundra, the session provided insights and examples on ‘How to Build a Brand Personally and Professionally.’

He also explained the importance of brand-building, and cited social media as one of the driving factors of brand-building.

Link::- https://www.youtube.com/watch?v=aOtaI683Ah4

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  1. LECTURE MEETING – SOCIAL AUDIT OF SOCIAL ENTERPRISES

On 1st March, 2023, BCAS organised a virtual lecture meeting on “Social Audit of Social Enterprises” in virtual mode.

The speaker, CA Sangeeta Kumar approached the topic in a very simple and logical manner by dividing it into various sections broadly covering the following:

  1. Historical background and principles of social audit.
  1. The legislative and policy background for setting up a Social Stock Exchange including the formation of relevant working and technical groups.
  1. Kumar also focused on the key highlights of the SEBI guidelines dealing with the setting up of Social Stock Exchanges and the regulation of Social Enterprises. She also gave an outline of the two stock exchanges functioning currently i.e. the Bombay Social Stock Exchange and the NSE Social Stock Exchange.
  1. The functioning of the various global social stock exchanges in different countries was touched upon covering their success stories and their failures in some countries resulting in closure were highlighted.
  1. The modes and procedures for registration and raising funds (including specific financial instruments like Zero Interest Zero Principal Bonds) by Social Enterprises through Social Stock Exchanges coupled with the various disclosure requirements, both initially at the time of raising funds and on an ongoing basis were also dealt with.
  1. Additionally, the seminar also discussed changes recommended in tax laws and CSR guidelines arising out of the legislation of social enterprises.
  1. Further, it provided an interesting perspective on undertaking social audits by the CAG coupled with a video on a case study on the social audit under the MGNREGA emphasizing the practical aspects like site visits and interviews coupled with the role of Gram Panchayats and Gram Sabha. The legislative support and the various global reporting standards and organisations dealing with the Social Audit were covered along with the draft Standards and Guidelines issued by the ICAI,
  1. Finally, the challenges which lie ahead for implementation in our country were highlighted.

BCAS Lecture Meetings are high-quality professional development sessions which are open-to-all to attend and participate. Missed the Lecture Meeting, but still interested in viewing the entire meeting video

Visit the below link or scan the Q.R. Code with your phone scanner app:

Link:- https://www.youtube.com/watch?v=GM04TqhoyDg

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  1. study circle meeting on Deemed Conveyance

Corporate and Commercial Law Study Circle organised a meeting on the topic “an overview of Deemed Conveyance.” At the meeting, Adv. Viral Shukla gave an insight into the position related to Deemed Conveyance before the MOFA (Maharashtra Ownership Flat Act), and legal provisions relating thereto post-MOFA 1963. He also briefly summarized the subsequent amendments made thereto in 2008, 2010, and 2018. Further, he dealt with all the queries of the participants. The meeting was attended by 50 participants.

  1. PROGRAM ON SUCCESS IN CA EXAM

The society organized a program titled ‘Success in CA Exam ‘ on 19th February 2023 on Zoom. The program included a Q&A session with the rank holders.

In the first session of this program, Dr. CA Mayur Nayak shared his inspiring journey as a CA student who failed in CA intermediate exams but cracked the CA final exams in the first attempt and thereafter secured an all India rank with his sheer determination, hard work, and positive attitude. He focused on the ways to mentally prepare for the exams, and accept failure. He gave tips on how to mentally calm one’s mind while attempting the paper, besides teaching a few deep breathing techniques. He explained that the greatest danger faced by the students is not in setting their aim too high and falling short but in setting their aim too low and achieving their mark.

In Q&A with the Rank holders Session, students asked live questions to the rank holders. The answers were designed to help the students prepare their best strategy based on the experience of the rank holders. Moderated by CA Vishal Poddar, Penalist CA Radhika Beriwala, and CA Shubham Keshwani, the session was very interactive.

  1. CHATGPT – AN OPPORTUNITY OR A THREAT TO PROFESSIONALS?

Artificial Intelligence (AI) has already revolutionized most industries by taking up jobs that could only be performed by skilled and intelligent humans. The next move of AI is the professional services domain like law, medicine, and education, where it is all set to solve problems humanity faces. It looks like; we shall soon be blessed by technology!

In the session conducted by the society on 18th February 2023, the speaker CA Vatsal Kanakiya spoke about what is ChatGPT and whether it is an opportunity or a threat for professionals.

The event witnessed a thrilling registration count of 750 participants.

The speaker explained about Chat generative Pre-Trained Transformer (Chat GPT). This was a first-hand and insightful session that focused on how ChatGPT can be an opportunity for professionals.

Link:- https://www.youtube.com/watch?v=DcyqXjSH5f8

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 7.  23RD DTAA COURSE HELD VIA ONLINE PLATFORM

The society successfully conducted its 23rd Study Course on ‘Double Taxation Avoidance Agreement’ via an online platform spanning from December 2022 to February 2023. The course was spread over 30 days and included over 36 sessions delivered by leading tax professionals of the country.

The course was designed to cover all the articles of DTAA, an overview of FEMA / BEPS / MLI / GAAR, Transfer Pricing, Source Rules under the Income Tax Act, 1961, TDS under section 195, Substance v/s Form, and other relevant provisions. The course introduced complex topics such as taxation of specific structures (e.g., Partnership, triangular cases, AOP, etc.) and selection of structures.

The course concluded with a Brain Trust Session having trustees namely CA Gautam Nayak, CA Yogesh Thar, and Shri Sanjeev Sharma, IRS, and moderated by CA Ganesh Rajgoplan.

About 167 Participants from 15 states spread over 30 cities attended the course which was well-received and appreciated by the participants.

The society will shortly distribute the participation certificates to all the eligible participants.

  1. IESG Meeting on Budget 2023

In the meeting held by the IESG (International Economics Study Group) on 16th February, 2023, CA (Dr.) Kishore K. Pahuja made a presentation on the topic,‘Impact of Budget on Indian Economy.’ In this presentation, Pahuja made a detailed analysis of many sectors including Defence, Agriculture, Automotive, Building, Construction & Real Estate, Education & Skill Development, Energy & Natural Resources, Healthcare, Infrastructure, Financial Services, etc.

CA Harshad Shah presented his ‘Vision for Amrit Kaal – an Empowered & Inclusive Economy.’ Amrit Kaal originates from the Vedic astrology and translates to the Golden era. It is the critical time when the gates of greater pleasure open for the inhuman, angels, and human beings, laying out a new roadmap for India for the next 25 years, a blueprint for India@100. The theme of the Amrit Kaal is a technology-driven and knowledge-based economy with strong public finances and a robust financial sector. It also focuses on ushering in the latest technology and digitization and reducing government interference in public life.

Learning Events at BCAS

1. Direct Tax Laws Study Circle meeting on recent SC Rulings

The Direct Tax Laws Committee of the Society organised a virtual meeting on 9th June, 2023 to discuss the recent Supreme Court Rulings. Chaired by Speaker, Natwar G. Thakrar, the meeting discussed the following rulings:

i.    US Technology Intl Pvt Ltd vs. CIT [2023]

ii.    CIT vs. Mansukh Dyeing & Printing Mills [2021]

iii.    Singapore Airlines Ltd vs. CIT [2022]

iv.    New Noble Education Society vs. CIT & Ors [2022]

The speaker explained the rulings to the attendees in a simplistic yet detailed manner. He began the explanation with Facts of the Case followed by Issue before the Supreme Court and concluded by ruling of the Apex Court.

The speaker then took up questions from the attendees wherein possible arguments to the rulings, other judicial precedents were discussed. The session concluded with a vote of thanks.

2. Seminar on ESG by the Internal Audit Commitee

A full-day ESG seminar was conducted by the BCAS Internal Audit Committee on 9th June, 2023. Titled ‘Decoding ESG through an Internal Auditor’s lens, the meeting was organised in a hybrid mode by the Internal Audit Committee of the Society. It aimed to enable the current and future generation of internal auditors to capitalise on the next-wave of ESG. A total of 87 participants attended this seminar, with a good mix of experienced professionals, new CAs and young aspiring CA students.

The seminar featured a unique blend of speakers from the industry, practice and consultancy who showcased their in-depth knowledge and insights on the subject. Each session was thoughtfully curated to include practical illustrations, real-life case scenarios and interactive communication with all participants. The seminar covered the following key topics:

  •     ESG and the pivotal role of Internal auditors in today’s scenario

 

  •     Basic principles, challenges faced and reporting requirements under ESG framework in India

 

  •     Practical guide on driving and implementing the ESG agenda

 

  •     Adding value to ESG ecosystem as Internal auditors

The speakers at the seminar included CA Nawshir Mirza, CA Mukundan KV, Ms. Chaitanya Kommukuri, CA Abhay Mehta, CA Raj Mullick, CA Vijayalakshmi S, CA Ashutosh Pednekar

The seminar was very well received by all the participants as was evident from their enthusiastic participation during Q&A sessions.

3. Lecture Meeting on Succession Planning and Drafting of Wills

BCAS organised a lecture meeting on ‘Succession Planning and Drafting of Wills’ on 2nd June, 2023. The meeting was organised with an aim to serve the members residing in the western suburbs. It began with an insightful presentation by CA Anup Shah on the following important aspects of wills and succession planning:

  •     Scope of succession planning

 

  •     Assets to be consider

 

  •     Legal implications in case where a person dies intestate and what if he had a prepared a will under all personal law in general and Hindu Succession Act (HSA) in specific

 

  •     Daughter’s right under HSA – prior to and post 2005 amendments

 

  •     Creation, Partition and dissolution of HUF under HSA and under the Income Tax Act

 

  •     Estate planning options through-Trust, Wills and Joint nomination

 

  •     Effect of nomination for immovable property and shares

 

  •     Rights of Joint Holder vs. Nominee

 

  •     Wills – What is a will, Who can make, How to make a will, concept of beneficiary, administrator

 

  •     Some Myths about the Wills

 

  •     Registration of Wills and Probate

 

  •     Recent developments on the methodology of preparing the wills – Video will, digital will, social custom will, organ donation

 

  •     Tax implications on wills and inheritance

 

  •     Private trust

 

  •     Gift/ release deed/ revocation of gift

The speaker addressed the queries raised by the members. The meeting was attended by more than 125 participants.

4. Release of BCAS publication – FAQs on Charitable Trust

The eagerly-awaited BCAS publication – FAQ on Charitable Trust was launched at the lecture meeting held on 2nd June 2023 in Mumbai. Released under the Shailesh Kapadia Memorial Publication fund, the publicationn covers FAQs on various important topics under Bombay Public Trust Act, Direct Tax, Indirect Tax, FCRA and CSR.Drafted in the form of Frequently Asked Questions (FAQs), the publication helps readers find the information they need. The questions have been carefully selected from a wide range of topics to provide in-depth knowledge on each subject. Their answers have been written in simple and easy to understand language making it accessible to everyone regardless of their legal background. Besides the Charitable Trust, the publication is likely to benefit professionals like lawyers, chartered accountants and consultants who advise charitable trust on legal and regulatory compliances.

Conceptualised by Late CA Tushar Doctor, the publication is authored by CA (Dr) Gautam Shah covering the topic of direct tax and other laws, and CA Naresh Sheth on the topic of indirect tax. It is reviewed by CA Anil Sathe, CA Himanshu Kishnadwala, CA Sunil Gabhawala, CA Gautam Nayak and Mr Nasir Dadrawala.

5. TDS and TCS Provisions – A 360° Perspective

IMC Chamber of Commerce and Industry teamed up with the Bombay Chartered Accountants Society, and Chamber of Tax Consultants to organise a full day seminar on “TDS and TCS Provisions – a 360° Perspective” at its premises.Held on 2nd June, 2023, the inaugural session of the seminar was managed by Anant Singhania, President, IMC; CA Chirag Doshi, Vice President, BCAS; CA Parag Ved, President, Chamber of Tax Consultant with a welcome address by CA Rajan Vora, Chairman, Direct-tax Committee, IMC.

Hosted in a hybrid mode, the seminar was attended by more than 300 participants. Before initiating the sessions, Rajan Vora, Chairman, Direct Taxation Committee, IMC, highlighted the need to streamline and simplify the TDS and TCS provisions as well as the related compliances to enable Ease of Doing Business in the true sense.

The seminar also included an interactive session with the attendees to highlight key topics like Domestic TDS & TCS provisions, Penalty, Prosecution and Compounding procedures under TDS/ TCS regime, TDS from payments to non-residents, etc.

Sangam Shrivastava, erstwhile Pr. CCIT (IT & TP), West Zone delivered the keynote address where he explained that even after amendment to section 115A by FA 2023, benefit of lower rate as per DTAA will be available to taxpayer instead of 20 per cent. (SC+EC). He also emphasised on reducing of litigation and increase dialogue between taxpayer and tax department.

Brajesh Kumar Singh, CCIT (TDS), Mumbai urged professionals to act as guide to taxpayers to undertake TDS compliances. He advised them to caution taxpayer that delay in TDS payment is tracked centrally and flagged by system thereby leaving no scope for department to not to initiate prosecution even in smallest of cases.

Moderated by Samir Kanabar from EY, the first session discussed issues under Domestic TDS & TCS provisions. The issues discussed on TDS included those under section, 193, 194-O, 194R, 194-Q, 194 BA, etc, TCS provisions under section 206C particular 206C(1G) and 206C(1H) were also discussed. The panelists for this session included Vikas Aggarwal from Novartis and Yogesh Thar from BSM

The second session was moderated by CA Atul Suraiya. It discussed issues pertaining to Penalty, Prosecution and Compounding procedures under TDS/ TCS regime

Other issues like penal and prosecution provision and compounding of offences; belated filing of returns/ belated payment of taxes; interest under section 201 and 201(1A), etc were also discussed.

Moderated by CA Shabbir Motorwala, the third session discussed issues related to TDS under section 195 from payments to non-residents

Other practical issues discussed at the session included: Non-filers checking, Lower deduction of tax; Rectifications of returns filed; Excess deduction – refund; Penal provision and compounding of offences; Belated filing of returns/belated payment of taxes; Interest under section 201 and 201(1A); Mechanism for Clarifications; etc.

The session also discussed issues arising on account of increase in rate of royalty/FTS taxation under Act, by FA 2023 and issues arising for filing of form 10F.

The conference was graced by eminent tax experts from the corporate and professional sectors as well as from the revenue department. who as panelists provided a comprehensive perspective and a blend of theoretical and practical solutions to the questions posed.

Comprising panel discussions and presentation sessions on relevant TDS and TCS issue, the seminar ended on a high note.

6. Recent PMLA notification and its impact on professional service firms

The Society organised a virtual panel discussion on 30th May, 2023 on the impact of the recent PMLA notification on professional service firms. The Panelist for the session were R N Dash, IRS and Adv Ashwani Taneja while the moderator was CA Anand Bathiya.

In his opening remarks, the moderator noted that the recent PMLA notification has brought about a sense of anxiety amongst CAs and certain other professionals due to increasing reporting obligations and greater responsibilities. He referred to it as the “fear of the unknown” and hoped that the discussion would clarify a lot of such fears and doubts.

Thereafter, both the panelists Dash and Adv Ashwani Taneja outlined the rationale behind the notifications dated 3rd May, 2023 and 9th May, 2023, which primarily stemmed from the FATF guidelines. Further, they indicated that
the notification expects the Professional Accountants to focus on the KYC and beneficial ownership status of their clients and to maintain complete details of their transactions.

The summary of the amendments covering the following matters were also touched upon:

  •     The obligations of Reporting Entities.

 

  •     Manner of verification of the identity of the clients by the Reporting Entity.

 

  •     Record maintenance in respect of specified transactions (covering buying and selling of investments and properties, managing client money, managing bank and security accounts etc.) undertaken or attempted to be undertaken.

 

  •     Timelines for maintenance of records.

 

  •     Enhanced due diligence to be undertaken in respect of all specified transactions by the reporting entities.

Powers of the Enforcement Directors and FIU-Ind

The discussion covered various questions put forth by the moderator and also by the participants which were comprehensively answered by the speakers. Some of the major points covered are as under:

  •     Services like internal audit undertaken as an employee of the Company are not covered.

 

  •     Services like virtual CFO in the capacity of a consultant are covered.

 

  •     In respect of tax related services it is better to avoid collection and reimbursement on behalf of clients.

 

  •     Currently, statutory audit services are not covered.

 

  •     Professionals should not adopt a casual attitude going forward, since the cost of non-compliance could be very high in many situations.

 

  •     Providing assistance in writing of the books of accounts of entities involved in suspicious transactions are not covered.

 

  •     Whilst undertaking transactions and assignments on behalf of clients the arm’s length principle should be adopted.

 

  •     Not to get associated with Benami Transactions.

 

  •     No clarity on whether a CA in his individual capacity or a firm of CAs would be considered as a Reporting Entity.

 

  •     Whilst independent directors appointed in their individual capacity are not covered. If they are nominees or representatives of the specified entities who undertake suspicious transactions, they would be covered. Similar considerations would also apply to trustees appointed.

 

  •     Entities providing space for use as a Registered Office and indulging in suspicious transactions are also covered.

 

  •     Pending the notification of the rules on certain matters it is important for Reporting Entities to maintain proper record for all specified transactions.

YouTube links: https://www.youtube.com/watch?v=hYXfaTEReog

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7. Serious threat to the US Banking System and US Dollar- International Economics Study Group meeting

The International Economics Study Group organised a virtual meeting on 29th May, 2023 to discuss the serious threat being faced by the US’ banking system currently. Chaired by CA Harshad Shah, the meeting noted, currently all US mid-cap banks are ‘full of’ bad commercial property loans worth $5.6 trillion. Confidence in the world’s largest banking system (American) is shaken and this could spread as there are concerns about Asset Liability mismatch, holding securities which have lost value since interest rates have risen at a sharp clip with brutal 450 basis points rise in interest rate in just 1 year from a near zero levels. Banks are sitting on $1.7 trillion in unrealized losses. Many U.S. banks have $7 trillion in uninsured bank deposits lying with them, which if withdrawn can create sudden rush.Further, the meeting discussed the serious challenges being faced by the Petro Dollar as many oil exporting countries (like Saudi Arabia, UAE, Iran, Venezuela, Russia) are looking at dealing in local currencies and avoiding Dollar due to threats of US sanctions and misuse of SWIFT.

Dedollarisation is fast catching up as many countries are entering and negotiating alternative to Dollar like bilateral currencies due to threats of blocking in SWIFT & other sanctions.

CA Milan Sanghani shared his views on current state of markets.

8. Internal Audit Mumbai Pune Express # 1

The inaugural edition of Internal Audit Mumbai Pune Express was held at MCCIA Trade Tower, Pune on 26th May, 2023. The event was jointly organized by the Internal Audit Committee of Bombay Chartered Accountants’ Society and IIA Pune Audit Club.

This was the first event held by the IA Committee of the Bombay Chartered Accountants’ Society in Pune.

The keynote address was delivered by Satish Shenoy who shared his views on “The focus – leveraging external events to deliver exceptional value”.

Dr. Milind Watve, a data scientist, presented his thoughts on “Data Analytics & Statistics in IA – a scientific view.”

A panel discussion ensued thereafter, whereby the panelists included Milind Limaye, Sanjay Deodhar and Satish Shenoy. The session was moderated by Madhavi Bhalerao. The topic for the panel discussion was “IA Standards – Mandatory or Recommendatory?”

Sameer Maheshwari delivered his session on “Auditing when the going is good”.

The last technical session for the day was by Arnob Choudhuri, who presented on the topic “IA Role in Business Responsibility & Sustainability Reporting”.

A total of 38 participants attended the day-long event which recorded a positive feedback.

The next edition of the Internal Audit Mumbai Pune Express series would be announced in due course.

9. Indirect Tax Laws Study Circle Meeting Specific issues in Customs laws, SEZ

The Indirect Tax Laws Committee of the Society organised a virtual study circle meeting on 25th May, 2023 under the leadership of CA. Prerana Shah. Ms. Shah had prepared six case studies regarding interplay of Customs and GST laws. The presentation and discussion broadly covered the intricacies on the following topics:

1.    HSN classification and rates of custom duty on import of goods in India

2.    Anti-dumping duties and import under advance authorisation

3.    Related Party Transactions under Customs Laws in regard to valuation,

4.    Value of export of goods under customs Law and GST Law

5.    Special Economic Zones – Refund

6.    Duty drawback, manufacturing under bond and FTWZ

More than 80 participants from across India participated in the meeting. The meeting was mentored by CA Udayan Chokshi

 

10. Direct Tax Home Refresher Course – 4

The Taxation Committee organised the Direct Tax Home Refresher Course 4 with eight other sister organizations i.e. All India Federation of Tax Practitioners (CZ), Association of Chartered Accountants, Chennai; Chartered Accountants Association, Ahmedabad; CA Association of Jalandhar; The Chartered Accountants Study Circle, Chennai; Hyderabad Chartered Accountants Society; Karnataka State Chartered Accountants’ Association and Lucknow Chartered Accountants’ Society.Held from 15th May, 2023 to 27th May, 2023, the virtual refresher course consisted of 12 sessions covering varied topics of income tax. The topics covered were

1)    Charitable Trust Taxation including recent amendments

2)    Taxation of various Financial products including AIFs, REITs, INVITs etc, Recent amendments and issues (IFSC)

3)    Taxation and Regulatory Aspects of various perquisites under Salaries including ESOPs

4)    Recent Developments in Sec 195 covering issues in 15CA & 15CB

5)    Taxation of Partnership Firms and LLPs on conversion incl. Issues on Amalgamation of LLPs

6)    Taxation and Regulatory aspects of Start-ups

7)    56 (2) (x) – An Evolving Deeming Fiction along with 56(2)(viib), 50CA, 50B r.w.r. 11UAE

8)    Taxation aspects of Redevelopment of Societies both from developer and the flat owner’s perspective (50C/43CA etc.)

9)    Valuation Under Income Tax Law vis-à-vis other laws – How to solve this game

10)    Case Studies on certain important aspects of Business Organisation & Reorganisation including M&A and Demergers

11)    Notice & Assessments related to Foreign Assets vis-a-vis Black Money Act and it’s Interplay with PMLA and other Economic Offences Laws

12)    Law of Evidence vis-à-vis Tax proceedings incl  Examination and Cross Examination / Do’s & Dont’s of rendering Tax Advice  ( special  reference to handle  arrest in such cases)

All the distinguished speakers shared their thoughts on the subject and their views on the practical issues arising out of them. They also engaged in a QnA with the participants and provided their insights. There was an overwhelming participation to the course with more than 650 registrations from across India.

11. Case Study based discussion on MLI

The International Taxation Committee of the Society conducted a hybrid meeting on 11th May, 2023. Titled, ‘:Case Study based discussion on MLI,’ the meeting was led by Group Leader CA. Ganesh Rajgopalan who discussed various case studies that were a part of the BCAS ITF conference held at Gandhinagar.The group leader also discussed issues arising out of the amendment to the treaties on account of signing of the MLI by various countries (including India). He highlighted the nuances under select treaties and the compared the change in language thereof on account signing of MLI. During the meeting, the group leader also encouraged a discussion on various aspects besides addressing queries by the participants. The discussion provided great insights provided to the participants.

12. HRD Study Circle Meeting -”Narmada Parikrama”

The HRD Committee of the Society organised a hybrid Study Circle meeting on 9th May, 2023 to discuss the below-mentioned Flash Points/Glimpses from the Experience Shared at the above Meeting:

  •     The Speaker, CA Prasad shared his experience of the Narmada Parikrama during the four months of November 2019 to March 2020. The walk was through the terrain of approximately 3,500 Kilometres in the state of Madhya Pradesh and Gujarat.

 

  •     “NARMADE HAR” This is a Staple word used during the Narmada Parikrama. The speaker related the mixed emotions he experienced the Parikrama. He related his entire journey for the benefit of the Young Professionals. He said, today’s youth, whether CA’s or not, have a lot to learn about the decision making process. Practical decision to take a walk along with Maa Narmada Maiyya. It is the food for thought if one decides to walk the stretch of Ma Narmada and understand India.

 

  •     There is great difference between qualification and enrichment. If one wants to enrich his or her experience with life, then, Narmada Parikrima is the Best Solution.

 

  •     Narmada River is like a mother, walking around it is like being in the lap of mother Narmada River.

 

  •     The walk teaches humility, patience, compassion and tolerance.

 

  •     The walk teaches how the poor are very generous and always willing to give. The villagers around the Narmada will ensure that every pilgrim is well fed, though they have to go in the neighborhood far away to bring ingredients like flour to make chapatis. The villagers sometimes are so poor that they do not have both ends to meet, yet they think of the Pilgrims before themselves or their family members. Can we try to think of others in the world around us? This was first glimpse of “param artha”.

 

  •     On being asked, whether one feels Homesick during the parikrama, the speaker answered that, there are so many interesting things in the nature and the atmosphere, that, one never feels homesick at all. In fact, sometimes, the persons feel that they should remain on the banks of Maa Narmada and not go back home.

 

  •     Some of the questions raised by the audience included about reading books on Parikrama or see any movies. However, the speaker advised the participants to talk to less people and concentrate and work. Over study and over thinking leads to failure whether in exam or during this pilgrimage. The speaker gave examples of over study and failures in the CA exams which some might have experienced.

The session ended with a Pranam by the speaker to all the offline and online participants.

YouTube Link : https://www.youtube.com/watch?v=Iv4tdY-mKEE

QR Code:
 

13. Bringing hope when there is none left.

 

  •     The HRD committee of the Society organised a meeting on 18th April, 2023 to spread awareness about Noble Social cause work carried on by Respected Mittal Maulik Patel, Founder  and Managing Trustee, Vicharta Samuday Samarthan Manch(VSSM) who has been Honoured with Nari Shakti Award at National Level for most significant work in the field of women empowerment by the hands of His Excellency President Ram Nath Kovind and also awarded Nari Shakti Award at State Level for most significant work in the field of women empowerment by the hands of Honourable Governor of Gujarat O.P. Kohli.

 

  •     She made detail presentation about VSSM, which is a non-profit organisation whose mission is to ensure and enable holistic development of the people belonging to the Nomadic, De-Notified Tribes and other marginalised section of the society addressing the interdependence and co evolution of human economies and biodiversity.

 

  •     VSSM is working to empower the nomadic and de-notified communities while striving to create an inclusive society as well as government policies for these extremely marginalised sections of our society. Actively working for the welfare of the most downtrodden Nomadic and De-Notified tribes on several socio-economic problem related to education, livelihood, health, human rights, environment, water management, empowerment, building hostel for school children, etc.

 

  •     The meeting ended with a heart-felt gratitude expressed by Mittalben, to the participants and prospective donors for their whole-hearted support to the organisation.

 

  •     She made a further appeal to the members present to spread awareness about VSSM to support and contribute towards the noble work carried on by VSSM. Donation to VSSM is eligible under CSR.

14. Human Resources Development Committee – “Graphology-Handwriting Analysis”.

The HRD Committee of the Society organised a hybrid meeting on 11th April, 2023 at its premises. Led by Bhupesh Singh Dhundele, Graphologist, the meeting imparted the below teachings:

1.    The participants were guided as to how they can analyse their own handwriting and those of others who they would like to know better.

2.    Our Handwriting records our accurate picture of our real self because it is the end result of our brain in action. When we write we think. Handwriting reveals our personality, presence, authority.

3.    Handwriting Analysis helps choose career.

4.    Discussed how to explore the secrets of an individual hidden in their handwriting.

5.    You are what you write. (Writing reflects your personal image)

6.    Your nature lies in your signature. (Signature reflects your personal image)

7.    Your writing is as unique as your thumb print.

8.    It represents your personality. It is instant pen picture/mental X-ray of your total personality of that moment.

9.    It is mind writing. People lost their hand in accidents/war, start writing with leg/mouth, achieve same handwriting after practice.

10.    Graphology is a subject dealing with Graphs.

Presented by Mr. Bhupesh Singh Dhundele (Graphologist)

YouTube Link: https://www.youtube.com/watch?v=24_eFjxBjMs

QR Code:

 

Society News – Learning Events at BCAS

LEARNING EVENTS AT BCAS

 

1. Lecture Meeting — the role of professionals in governance

In the first annual lecture meeting organised by the Society on 12th July, 2023, the speaker, CA Nawshir Mirza congratulated the incoming President and the Society for entering its 75th year. He indicated that Society needs to introspect on its role on the threshold of this historic moment. It is in this context that the topic ‘Role of Professionals in Governance’ assumes special significance. He then proceeded to provide a masterly analysis, of the following matters:

  • He began by dwelling on the hallmarks of professionals like competence, objectivity, independence, ethics, good communication and being effective influencers. He further added that they need to live by their vision.

 

  • Next, he went on to describe governance as similar to religion. It is primarily compliance-driven even though currently compliance is at a saturation point. He also touched upon the history of governance by stating that it began with the political system of governance in Europe comprising of the estates, barons, clergy and the common man. He further added that the French Revolution changed the concept of governance and the third estate (i.e., the common man) which paved the way for the universal adult franchise.

 

  • Moving forward, he elaborated that political governance moved towards corporate governance which initially was more to deal with the providers of capital. In this context, he emphasised that the Companies Act, 2013 (“the Act”) is a unique piece of legislation that deals with the interests of the providers of capital (primarily the shareholders).

 

  • However, recently, corporate governance has progressed further and now deals with the rights of all stakeholders, whereby he referred to a speech by the Chairman of the International Sustainability Standards Board that dealt with how the value of a company as a creator for its shareholders is inextricably linked with the ecosystem., thus signalling a shift from the efficiency mindset (from a shareholder’s perspective) to a sustainability mindset (from the stakeholder value perspective).

 

  • The role of Independent Directors was also discussed by referring to the provisions of section 166(2) read with Schedule IV of the Act, which outlines their duties and responsibilities towards the interests of the environment and society. Citing from his experience as an independent director, he noted that the following significant principles and recent changes need to be kept in mind whilst engaging and practicing governance by all professionals:

1.    The learnings from the Enron era which placed doubts on the integrity of the Corporate Managers and the global financial crisis of 2008 and the consequential wealth inequalities.

2.    Responsibility of the Board, management and managers to the interests of all the stakeholders.

3.    Practicing fairness, accountability and transparency towards all stakeholders.

4.    Being aware of the recent reporting changes, both locally and globally, like the BRSR Report, Integrated Reporting, Task Force on Climate-Related Disclosures, Carbon disclosure project, sustainability standards, etc.

5.    Being aware of the various ESG risks, greenwashing, and measurement tools for non-financial measures like the Science Based Target Initiatives (for reducing the impact of plastic on the environment).

6.    To steer discussions responsibly and be sensitive to the interests of all stakeholders.

  • He concluded by advising on the following matters both as professionals whilst engaging with clients and also in their personal capacity:

1.    As professionals, we need to be responsible for our behaviour and its impact on society.

2.    A road map or plan needs to be developed to embrace sustainability.

3.    To assist in measuring and reporting on various ESG parameters since top management compensation is now aligned in greater measure with ESG parameters rather than financial parameters.

4.    We need to curb irresponsible usage and consumption in our personal capacity to preserve and sustain the environment.

BCAS Lecture Meetings are high-quality professional development sessions that are open-to-all to attend and participate. Missed the Lecture Meeting, but still interested in viewing the entire meeting video?

 

Visit the below link or scan the QR Code with your phone scanner app:

YouTube Link: https://www.youtube.com/watch?v=uvNOUp2Aj6I

QR Code:
 
2. 75th Founding Day lecture meeting on India @2030

At the 75th Founding Day Lecture Meeting on India @2030, Sajjan Jindal, Chairman, JSW Group, began his keynote address by emphasising that the topic India @2030 is very close to his heart. He then proceeded by broadly touching upon the following areas:

  • The current decade will be India’s decade, and the time has come for the country to deliver, unlike the past, when we were like a pregnant lady who never delivered. He added that by 2030, India will be a very different country, and we will be proud of it. The stable governments in the last two decades, and especially the present government, have instilled a tremendous sense of pride coupled with a positive attitude which has resulted in awakening a sleeping giant.

 

  • He cited the example of the remarkable way in which the government navigated through the COVID-19 pandemic. Whilst the performance of the other countries post the pandemic was affected like the increase in the US inflation by 30 times, India managed its economy fairly well. He felt that India’s moment has now arrived just like that of Japan at the end of the Second World War, and it is well positioned to become the third largest economy in the world following USA and China by the end of the decade.

 

  • Next, he touched on several reforms undertaken by the present government, like GST, Swachh Bharat, IBC and digitization which have resulted in greater awareness and responsible behavior amongst the citizens. He made a specific reference to the IBC which has alerted defaulters and made companies more careful whilst borrowing.

He proceeded by touching upon several advantages that will help us to be major player by 2030, and propel India towards a 30 trillion dollar economy. These include:

1.    The demographic dividend is evidenced by our young population. The large population is and will continue to be our strength unlike in the past when the Government had to resort to family planning, sometimes forcibly.

2.    The digitisation drive has resulted in better transparency and governance. It has also brought about reforms in healthcare and education.

3.    We have the potential to scale up the manufacturing capacity under the ‘China plus One’ policy and match the gap created by ‘China as a result’  of decline in its manufacturing capacity. He referred to the JSW Group increasing its capacity with an aim to become the best manufacturer of steel in India.

4.    The energy transition from fossil fuel-based to renewable energy will be a game changer, since the latter is much cheaper. He indicated that he aims to make JSW the first company in India to fully use renewable energy.

5.    Continuing reforms in the financial, banking and capital market sectors will help us towards being a 5 trillion dollar economy in the next five years.

6.    The global leadership role of India is increasing visibly, including the current G20 leadership.

  • He concluded his address by emphasising that the growth of JSW is due to the highest standards of corporate governance adopted. He also indicated that CAs are the first line of defense by providing a governance control mechanism, which is the surest way to achieving growth.

BCAS Lecture Meetings are high-quality professional development sessions which are open-to-all to attend and participate. Missed the Lecture Meeting, but still interested in viewing the entire meeting video?

Visit the below link or scan the QR Code with your phone scanner app:

YouTube Link: https://www.youtube.com/watch?v=PxxNfYuIVpU

QR Code:
3. FEMA Study Circle meeting

FEMA organised a study circle meeting on the topics covering LRS and the new ODI regulations. The meeting included interactions with the AD Banker, Axis Bank.The meeting was held online where the members asked various queries and got the responses from the viewpoint of the Banker.

The speakers at the meeting included Ronnie Quadros and Anjali Jain, Vice Presidents of Axis Bank. Both the group leaders gave their views on various issues in outbound investments and LRS such as repatriation of funds to be made within 180 days of the August 2022 circular even for the earlier remittances made and unutilised. Amongst other things, they also provided their view on the procedure to be followed in case of a change of residential status to a non-resident.

Apart from the above, various other doubts of the group were cleared by the group leaders that made the session interactive and facilitated group learning.

 


4. Workshop on Strength — Pillars of Relationships

A hybrid workshop on the topic ‘Strength — Pillars of Relationship’ was held by the Society on 23rd June, 2023 at its premises. The workshop emphasised the following points:

  • It is important to have TRUST in relationships. This is one basis of any relationship and trust is built on Character & Competency (the basis for Trustworthiness). Both are required for building Trust.

 

  • It is also important to be AVAILABLE to each other as per mutual needs to have a strong relationship.

 

  • Another learning is that RESPECT is the most important element in the relationship. Respect for the other person, irrespective of their status, age, demography and educational background, builds a relationship.

 

  • We learned also about nine types of relationships and their features, e.g., Co-Dependent relationship between Doctor–Patient, husband–wife, etc.

 

  • Also, an important learning was that there are six types of unhealthy expectations, e.g., “Everyone will like me”. This kind of expectation leads to pretending to be “what I am NOT”! And we become incapable of accepting others’ opinions and judgements about us.

 

  • I don’t impose my views on my child and allow them to grow and flourish in their own way.

 

  • Also learned about 10 known worlds, e.g., the world of Buddhahood being the highest as complete and full of perfect freedom.

 

  • There are 20 ineffective habits, e.g., “Claiming credit that I do not deserve”, “Passing judgements on others”, and “Not listening to another person”. These habits come in the way for anyone to build healthy relationships.

 

  • Then we learned about the Characteristics of Good Relationships like Communication, Patience, Commitment, etc.

 

  • Overall, our awareness of how to build strong relationships has enhanced and this training will be of immense help in our development as a good human being.

5. HRD Study Circle Meeting to celebrate International Yoga Day

 

The HRD committee of the society organised a study circle meeting on the “Simple Yoga Asanas” for all ages to remain flexible and strong (Especially for the Busy Bee’s). The topic was presented by Mr Pradeep Thakkar, who:

1.    Explained and demonstrated exercises and benefits of common asanas for all ages to remain flexible, strong and healthy He also demonstrated exercises and explained benefits to get rid of osteo arthritis, knee pain, blood pressure, diabetes and be disease free.

Some more points elaborated by him on specific exercises included:
2.    Self-massage assana, which relaxes pain in the body.

3.    Pavan muktasana by which gases, in the body are released. It also gives relief from constipation and strengthens digestive system. Also provides benefits by relieving mental and physical stress.

4.    Shalabhasana (locust pose) provides stability to the spine and lengthens the upper back and arm. It can strengthen lower back and pelvic organs, hip joints, legs and arms.

5.    Siddhasana improves posture and straightens spine, hips, chest and shoulders. It increases flexibility in your hips and inner thigh muscles.

6.    Tadasana improves posture, alignment and balance.

7.    Vajrasana is also good for digestion. It relieves low back pain.

8.    Shavasana calms the body and relieves stress, depression and insomnia.

9.    Bhujang asana is good for the lower back. It is also good for flexibility.

Further, Mr Thakkar taught a number of asanas for flexibility, osteo arthritis, BP, Diabetes, thyroid, etc. The meeting was attended by 93 members, out of which 31 attended physically while 62 members attended the meeting online.

Visit the below link or scan the QR Code with your phone scanner app:


YouTube link: https://www.youtube.com/watch?v=etiZm6UJD40

QR Code:

 

6. HRD Study Circle Meeting on effective communication

In the meeting held on 18th June, 2023, the HRD Study Circle discussed the benefits of effective communication. The topic for the meeting was, ‘Communicate to Convince. Creating Win-win situations.’ The meeting emphasised that it is very important to communicate with yourself and others in various situations. The purpose is met only when we communicate successfully to make the other understand and get convinced. Also, both parties have to be in a winning mode as a result of the communication. It is an art to communicate what you want and get what you want.Some of the steps required for effective communication include:

1.    Creating a rapport.

2.    Getting to where the other person is.

3.    Bringing the person to where you want him to get in order that both you and the other person are mutually benefitted and get what each other wants.

4.    The process was explained with examples.

5.    NLP is a process that helps to give and convey the right meaning to the other person so that the person conveying the message and the person to whom it is conveyed is as required.

6.    A complimentary complete course in NLP, Speed Reading and Productivity is being offered by Knowledge and Karma for all BCAS Members.

7. HRD Committee Workshop on Learning Technology for Senior CAs

The HRD Committee organised a half-day workshop for Senior CAs and their spouses. The workshop aimed to equip the participants with essential precautions while using technology and introduce them to valuable tools that can enhance their day-to-day lives.The workshop was led by CA Yazdi Tantra, a highly regarded and experienced technologist. Mr Tantra shed light on the effective ways to safeguard against the various types of online fraud. Additionally, he provided valuable insights into spotting fake news amidst the vast ocean of information and misinformation on the internet.

The speaker addressed the pressing concerns surrounding online security and illuminated various tactics employed by cybercriminals to target unsuspecting individuals. Participants gained in-depth knowledge about common types of cyber fraud, including phishing, identity theft, and online scams. Moreover, they learned practical steps to strengthen their digital defence, protecting their sensitive data and financial assets.

Further, the workshop delved into the art of distinguishing genuine news from fake news, rumours, and misleading content. Participants acquired valuable techniques to critically analyse information and make informed decisions, thereby minimising the spread of misinformation.

Participants actively participated in discussions and real-life scenarios to apply the knowledge gained during the session. This approach ensured a more profound understanding of the subject matter and encouraged open dialogues among attendees.

8. Suburban Study Circle Meeting on “Audit Trail — Compliance under CARO 2020 and Practical Challenges”

The Suburban Study Circle Meeting on the topic “Audit Trail — Compliance under CARO 2020 and Practical Challenges”, was held by CA Taher Pepermintwala as a Group Leader.

Making an insightful presentation, Taher shared his views on the following:

  • Elaborate meaning and inclusions in ‘Audit Trail’

 

  • Applicability of Audit Trail to various classes of companies and LLP

 

  • Statutory provisions of Audit Trail under the Companies Act, 2013

 

  • Regulatory implications for CA / CS professionals and matters to be included in the audit report

 

  • Management responsibility

 

  • Compliance checkpoints

 

  • Illustration of an Audit Trail in various accounting systems

 

  • Other practical challenges

The knowledgeable and practical session coveredall the points with numerous case studies to make it simpler for the group to understand it better.

The session had wonderful interactive participation from the group. A large number of queries from the participants were addressed satisfactorily by the group leader. Taher’s command of the subject was well appreciated by the group. The senior and experienced members’ guidance and experiences on certain issues enriched the discussion.

The participants benefited from the elaborate presentation shared by the group leader.


9. Indirect Tax Laws Study Circle Meeting on GST Refunds

The Indirect Tax Laws Study Circle organised a meeting on the topic, ‘Practical Issues in GST Refunds’. The group leader and speaker CA Shuchi Sethi prepared seven case studies, including a presentation covering the intricacies, on the following topics:1.    Refund of ITC on exports under LUT

2.    Inverted rated turnover for Refund under inverted duty structure

3.    Third proviso to section 54(3)

4.    Calculation of Net ITC for Refunds under 89(4) and 89(5)

5.    Relevant Date after Deficiency Memo

6.    Refund of ineligible credit by exporters

7.    Refund of tax paid on excess rates in case of all-inclusive price contracts

More than 100 participants from across India benefitted, participating in the meeting under the able guidance of the group mentor CA Jignesh Kansara.

 


10. Workshop on the Use of Technology in Audit
A half-day workshop on the ‘Use of Technology in Audit’ was held by the Society on 30th June, 2023. The workshop envisioned to enable audit professionals to leverage technology solutions in planning and executing audit engagement.The workshop began with Speaker CA A Rafeq giving insights on ‘Developing Strategies for Automation and Designing Parameters for Evaluation and Selection of Audit Automation Software’. The moderator for the workshop was CA Amit Majmudar.
The workshop provided a platform to various technology solution vendors to showcase how audit professionals can implement their products and benefit from them. The softwares demonstrated were: Auditors Desk, AudTech and AssureAI.The third part was a panel discussion amongst audit professionals where leaders shared their experiences, insights, challenges and achievements from implementing technology solutions in audit engagements. The panelists CA Gautam Shah, CA Guru Prasad, CA Nemish Kapadia and moderator CA Amit Majmudar kept the audiences engaged and enthused throughout.The workshop witnessed a fabulous registration of 100 participants. It succeeded in achieving its objectives as the participants concluded the sessions with a “thunderous round of applause”!

SOCIETY NEWS – Part 2

14TH JAL ERACH DASTUR CA STUDENTS’ ANNUAL DAY – ‘TARANG 2k22’
It
was three months ago, when the Students’ Team and members of the Human
Resource Development Committee (HRD) met, the day when the success and
grandeur of past thirteen glorious years began reverberating in
everyone’s minds.

The 14th edition of Jal Erach Dastur CA Students’ Annual Day under the brand of ‘Tarang’
had to be bigger and better. With this mission, the Students’ Team
embarked upon the journey with enthusiasm and dedication for Tarang 2k22, led by the student coordinators – Ms. Richi Monani, Ms. Divya Rai and Ms. Anushree Shah.

The
event was organized by the Students’ Committee under auspices of the
HRD Committee of BCAS. It was sponsored by Mr. Sohrab Dastur in memory
of his beloved brother Late Jal Erach Dastur. The Students’ Team
comprised of a group of 33 dedicated and enthusiastic students. It was
truly an event ‘OF CA students, BY CA students and FOR CA students.’ The
dull and monotonous perception regarding CA students was completely
changed when they were witnessed as event managers, anchors, talented
dancers and photographers too!

This year saw a huge enrolment of
550 students despite the delay in CA exams and the various pending due
dates. There were about 260 participants in Tarang 2k22, with the highest number of participants in the Talent Show and the Talk Hawk Competition. This year ‘Tarang’
reinvented its Short Film Making competition into Reel Making
Competition to create a fun-filled and thrilling experience for all the
students.

The 14th Jal Erach Dastur CA Students’ Annual Day – ‘Tarang 2k22’
elimination rounds were held at BCAS Hall on 18th and 19th of June,
2022 and the finale was held at K.C College Auditorium on 25th June,
2022.
 
The grand finale commenced with the lighting of the lamp by the HRD Committee and the student coordinators with the Ganesh Vandana and Saraswati Vandana playing in the background, invoking the blessings of Lord Ganesh (the god of Wisdom) and Maa Saraswati.
 
The three finalist teams of the ‘Antakshari Competition’ named ‘Deewane’, ‘Parwane’ and ‘Mastane’ were the first to compete on the stage. The Antakshari
had fun-filled and innovative rounds to test quick thinking though
tickling the lighter side of the participants. Everyone was quite
surprised to witness the accuracy of CA students, even in the arena of
Bollywood trivia and songs. The event was hosted by CA Hrudyesh Pankhania and CA Utsav Shah. Overall, it provided a great start to the event, and the audience got hooked from the beginning of the show.

The next event to follow was the ‘Debate’, wherein there were 8 finalists. The moderator for this event was CA Jigar Shah
who amazed the audience with his moderation skills. The topic for
Debate was “Content on OTT should not be censored” The jury and the audience were impressed with the debating skills of CA students. There were loud cheers among the audience as well.

The
next event was ‘Talk Hawk’ (sponsored by Smt. Chandanben Maganlal Bhatt
Elocution Fund), wherein the three finalists had to give a 4-minute
talk on any one of the topics. This enabled a level-playing field for
all participants who gave impressive performances on their chosen
topics. It was a close contest and even made it tough for judges to
decide the winner. One could only gasp at the ability of CA students to
give motivational talks with such wit and vigour.
 
Then, the time had ripened for the most awaited event of the evening – CA’s Got Talent. The singers had assembled, guitars, dholkis and
other instruments were in place, dancers were on their feet, and actors
began polishing their lines before they could thrill the audience with
their phenomenal performances. To give a spirited kick start to this
most awaited event, the Students’ Team presented a 4-minute musical
tribute to our beloved singers Lata Didi and KK. This was followed by a
3-minute dance flash mob by the Students’ Team which CA Rishikesh Joshi choreographed.

The
audience could figure that the spectacular flash mob was just a trailer
to what they were going to witness in the Talent Show. And rightly so,
the overall nine performances in various categories like music (which
included singing and instrumental), dancing and other performing arts
category enthralled the audience. The judges were fascinated, rather
bewitched, by the talent of young CA students. They indeed had a
mountainous task of choosing the winner in each category.

Post
the Talent Show, the winning film of Reel making competition –
‘TarangReelsStar’ was played. The reels were so precisely shot that one
could easily imagine CAs as the next social media influencers and
content creators.

Next, the best photographs from the Photography Competition ‘Khinch Le’
were displayed on the stage. For the public choice award, photographs
were put up by the participants on the BCAS Tarang Page, and the
photograph with the maximum likes was declared the winner. Participants
were given themes on which they had to click creative photographs and
post them on the Instagram Page with an innovative tagline based on the
theme selected. This competition saw a record participation of 51
entries which kept the Instagram Page thundering for weeks. With such
mind-boggling photographs, the judges indeed had a herculean task of
selecting the best one here as well.
 
With the clock ticking, the
participants began crossing their fingers as the moment of judgement
was here. The winners of the competition, representing their firms, were
finally announced. The list of winners is as under:

Essay Writing Competition – ‘Awaken the Writer Within!’

Prize

Name of CA Student

Name of Firm

1st
Prize Winner

Pooja
Sanghvi

——————

2nd
Prize Winner

Smit
Jain

BDO
India LLP

3rd
Prize Winner

Ekta
Galani

BDO
India LLP

Talk Hawk
– ‘Aspire to Inspire’

Prize

Name of CA Student

Name of Firm

Winner

Vishesh
Mehta

BDO
India LLP

The Rotating Trophy went to BDO India LLP

Talent
Show ‘CA’s Got Talent’

Prize

Name of CA Student

Name of Firm

1st
Prize
(Music Category)

Mithil
Shirke

——————

1st
Prize
(Dancing Category)

Manasvi
Pandharpatte

——————

1st
Prize
(Other Performing Arts Category)

Sakshi
Chaubey

Shah
Modi Kataudia & Co. LLP

Antakshari
Competition – ‘Suro ke Sartaaj’

Prize

Name of CA Student

Name of Firm

Winning
Team

Smit
Jain

BDO LLP

Gaurang
Shah

——————

Piyush
Jain

Mahajana
& Aibara Chartered Accountants LLP

Best
Individual Performer

Smit
Jain

BDO LLP

Slogan
& Sketch Competition – ‘Leave Your Mark’

Prize

Name of CA Student

Name of Firm

1st
Prize Winner

Aathira
Maniath

Baker
Tilly DHC

2nd
Prize Winner

Jeni
Shah

N.A.
Shah Associates

3rd
Prize Winner

Pooja
Patade

Patade
& Associates

Photography
Competition ‘Khinch Le’

Prize

Name of CA Student

Name of Firm

Judges’
Choice Prize

Priyank
Gosar

GBCA
& Associates LLP

Public
Choice Prize

Harsh
Shah

——————

Reel
Making Competition ‘TarangReelStar’

Prize

Name of CA Student

Name of Firm

Judges’
Choice Prize

Sushil
Khubchandani

——————

Public
Choice Prize

Ekta
Singh

S.K.
Rathi & Co.

Debate
Competition – ‘War of Words’

Prize

Name of CA Student

Name of Firm

Winning
Team

Vishesh
Mehta

BDO
India LLP

Ekta
Galani

BDO
India LLP

Harsh
Shah

——————

Jeni
Shah

N.A.
Shah Associates

Best
Debater

Vishesh
Mehta

BDO
India LLP

The Rotating Trophy went to BDO India LLP
Hearty Congratulations to all the winners and their firms.

Judges for the Various Competitions were as follows:

Competition

Elimination Round

Final Round

Essay
Writing

CA
Gracy Mendes and CA Hardik Mehta

Talk
Hawk

CA Khushbu Shah

CA Charmi Shroff

CA Ashish Fafadia

CA Atul Doshi

Talent
Show

CA Jigar Jain

Ms. Ridhima Limaye

CA Nirav Parikh

CA Rishikesh Joshi

CA Kartik Srinivasan

CA Devansh Doshi

Antakshari
Competition

CA Nidhi Shah

CA Mehul Shah

CA Meena Shah

CA Mayur Desai

Debate
Competition

CA Mukesh Trivedi

CA Samarth Patil

CA Mayur Nayak

CA Chirag Doshi

Slogan
& Sketch Competition

CA Jagat Mehta and CA Raman Jokhakar

Photography
Competition

Priyanshi Agarwal and CA Pankaj Singhal

Reel
Making Competition

CA Rimple Dedhia and CA Maitri Ahuja

Master
Of Ceremony Contest

CA Nilay Gokhale and CA Veerti Kothari

The entire evening was marvelously anchored by the Masters of
Ceremony – Mr. Aditya Sharma, Mr. Ankush Chirimar and Ms. Eesha Sawla
with their sheer display of energy coupled with the mind-blowing
performances. Together, they ensured that the audience had no reason to
lose their attention during the entire show.
 
Ms. Labdhi Mehta
proposed the well-deserved vote of thanks to Mr. Sohrab Erach Dastur for
sponsoring the annual day in the fond memory of his brother, late Jal
Erach Dastur, the family of Smt. Chandanben Maganlal Bhatt for
sponsoring the Elocution Competition, the members of the Managing
Committee, HRD Committee, the Coordinators of the Annual Day, the
photographers for the event, BCAS Staff, parents, principals of CA
students, sound technicians, the vibrant team of student volunteers and
all the CA students for participating in big numbers.
 
A
scrumptious dinner was arranged after the event for all those who marked
their presence at the annual day. The underlying purpose of the event
was to not only develop and encourage skills and extracurricular
participation but also to bring together the entire CA fraternity which
was very well achieved this time too. At last, with a sense of
satisfaction, joy of success, lasting motivation and some unforgettable
memories, we had to call it a day.

With the 14th edition scaling new heights and raising the bar, all eyes are now set on what the next edition offers.

Youtube Link:
https://www.youtube.com/watch?v=qz7_sn7aYzQ

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POWER OF ATTRACTION
Every year, the Human Resource Development Committee of BCAS organises a 2/3 days residential retreat towards leadership development, wherein even spouses are allowed to join. This year, like last year, due to the pandemic, we decided to conduct this program virtually.

HRD Committee arranged a webinar on Power of Attraction by Naz Chougley on 30th June, 2022 and 1st July, 2022 (between 5.30 pm to 8 pm). Naz Chougley is the co-founder of ‘Asip Rise’ , a wellness company serving to empower lives. She is a life coach, meditation teacher, holistic healer, behaviour analyst and corporate trainer. The purpose of the webinar was to understand the principles of the law of attraction, how to handle stress and the power of working with intentions and practices to stay positive and to forgive.

The webinar was attended by 60 persons. The coach agreed to share some more thoughts for practices through the WhatsApp group. Hence, a WhatsApp group of participants was formed after the webinar. Participants were shared video recordings of the webinar for a recap and better understanding of the subject. The deliberation by Naz Chougleyji was highly appreciated by all the participants. It was felt that very powerful practical tips were shared that could be applied in practical life, and good results can be achieved. To enhance the benefits, it was decided to organise a recap webinar in September, 2022.   

FOUNDING DAY LECTURE BY MR. N. CHANDRASEKARAN


 

The BCAS Founding Day Lecture is a treasured legacy of the last many decades that has culminated into a best-in-class thought-leadership platform witnessing addresses by luminaries and leaders in the fields of profession, industry and government, among others. This year’s Founding Day Lecture further raised the bar with an insightful and engaging lecture by Padmabhushan Shri N. Chandrasekaran, Chairman, Tata Sons.

On 6th July, 2022, at the 74th Founding Day of BCAS, Mr. N. Chandrasekaran addressed the BCAS community on ‘Future Trends, Risks and Opportunities’ in the Indian context. In witness of a packed auditorium at MCA The Lounge at Wankhede Stadium, Mr. Chandrasekaran shared his insights into emerging trends in the near future along with the risks and opportunities that they may propagate.

He set the context in the backdrop of the last two years, emphasising that the change we have seen over the previous two years is almost equal to a decade of experience. The pandemic brought the world economy to its knees, and it was almost unthinkable that the world was at a standstill.

He emphasized that the world witnessed a sharp stock market slump and a sudden rise,  contracting GDP followed by a huge bounce-back, a military conflict and the stock market reaction. He expressed that we would continue to witness turbulence – military conflicts, supply chain constraints, etc., which will remain consistent in the near future.

Coming out of the pandemic waves, the expectations of a high-growth high-inflation economy have withered, and what we are experiencing is a slow-growth and super-high-inflationary economy.

On the positive side, he stated, we experienced a fantastic display of the human spirit, people adapting to the hardship, poor and rich equally, and the phenomenal adaptation of digital technologies – schools, shopping, work everywhere globally went digital. We also witnessed massive innovation, i.e., a vaccine produced in less than a year – probably, the largest effort globally to vaccinate 7 billion people. And in all this, if we look at the future, things are happening which will point to certain directions the world will take for businesses, society and nations. Out of the many such trends, he delved into four trends which he believes are fundamental shifts. He deeply felt that these trends would have a huge impact and are highly favourable for India, significantly increasing our country’s growth velocity.

1. Digital Adoption –  Digital Adoption is here to stay. Through the last two years, we have gained an adoption advantage of 10 years. This is a huge advantage for India as we have peculiar problems that cannot be solved otherwise. From an Indian perspective, our societal issues are surrounded by a lack of access and jobs. During the pandemic, rural kids lost two years. Similar was the case with hospitals. And we can’t solve this problem by building lakhs of schools and thousands of hospitals. The only way is to use digital technology to leverage the impact by creating jobs that can support the experts. So, when you provide access, you can include people in the market who are currently not in it. This will also push the formalization of jobs, change society and bring societal equality to some extent. From a business perspective, every business will be a digital business. On whether bots will take over jobs? He replied that he doesn’t think so, not in India. It will only expand the job landscape.

2. Sustainability – Moving towards a green economy is irreversible. We are seeing this in many western countries. People post-pandemic do not want to come to the office. Fortunately, we don’t have that problem. The pressure on countries to go carbon-free will remain, and the dates we keep hearing for meeting goals will only advance as time progresses.

India has a huge advantage in this as well. Whilst developed countries are required to replace their existing infrastructure with green infrastructure, we in India are still building our infrastructure. This will help us to build green infrastructure directly. Going forward, many jobs and businesses that revolve around sustainability will be created.

3. Supply Chain Resilience-  In all his years at work, he stated that they never had a business plan which was not ‘demand based’. For the first time, business plans are being built on supply availability. So, we are getting used to different ways of working. Earlier businesses required supply chains to be quick and efficient, while today, the need is for supply chains to be fast and ‘resilient’. The element of resilience would mean having alternate manufacturing and supply locations, and India will be a key beneficiary.

4. Talent – The fourth and perhaps the most pertinent trend is how the talent landscape pans out. He expressed that we are in a race and are still learning the future of work. Work from home (WFH) and work from anywhere (WFA) are new models, and modern-day technologies have enabled them. Perhaps, the ‘workplace and the workmen’ have been separated for the first time in human history. This trend is emerging, and we are seeing the gig economy grow on this trend. The adoption of technology will also help enhance women’s participation in India’s workforce.

Shri N. Chandrasekaran continued his thoughts and answered a few queries from the attendees.

CA Anand Bathiya proposed the vote of thanks.

The lecture can be viewed on the following:

YouTube Link:
https://www.youtube.com/watch?v=4BCEXL1Uv-I

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TRAINING SESSION FOR CA ARTICLE STUDENTS ON “CHANGES IN INCOME-TAX FORMS FOR INDIVIDUALS AND HUFS FOR A.Y. 2022-23”
On 8th July, 2022, the Students Forum under the aegis of the HRD Committee organised an online training session on “Changes in Income-Tax Forms for Individuals and HUFs for A.Y. 2022-23”, led by CA Priyanshu Shah, a proficient speaker on the subject. Ms. Labdhi Mehta, the student coordinator, introduced the speaker to the participants. She was followed by CA Utsav Shah, a HRD Committee member who also addressed the students.

CA Priyanshu Shah, in his detailed presentation, covered Changes in ITRs, Dividends, Residential Status, Special Economic Presence, Taxability of Interest on Provident Fund, Investment in un-incorporated entity and Taxability of ESOPs. He elaborately explained the changes in rules, sections and in schedules in ITR form with illustrations. He meticulously addressed all the relevant amendments.

The session was interactive, whereby the speaker answered all the queries raised by the participants. The session ended with Student Study Circle Co-ordinator, Mr. Harsh Shah, proposing a vote of thanks to the speaker. With the ITR filing due date round the corner, the topic had its own importance which could be easily seen by the tremendous response from the students. Overall, 270+ students participated and benefited from the session.

Youtube Link:
https://www.youtube.com/watch?v=jW6VXxQDz1Q

QR Code:

SOCIETY NEWS – Part 1

“POWER SUMMIT 2022”

The Human Resource Development Committee of BCAS organised a one-day programme, “The Power Summit 2022: Thriving in a Transformed Hybrid World”, on 28th May, 2022 at the Orchid Hotel, Mumbai. The Summit was in continuation of a series of Power Summits organised annually since 2011.

The Power Summit, curated and anchored by a team of 3 faculty members, CA Nandita Parekh, CA Ameet Patel and CA Vaibhav Manek, was attended by 76 members from various cities in India and abroad. The programme was designed and seamlessly coordinated by this team. The presentations were creative, intriguing and intertwined with pointers that provided much food for thought. In addition to the trio, the faculty comprised CA Milin Mehta, CA Nilesh Vikamsey and CA Shariq Contractor.

The Summit raised important issues dealing with succession planning and sustainability of professional practices, merger mathematics and valuation of professional practices, the challenges and opportunities arising due to technological advances and the need to get ready to “thrive” and not just survive in these disruptive times.

The participant’s interest was evident in terms of involved discussions and the incessant questions raised at each session. The Summit was divided into five sessions on different topics, each undertaken by an experienced speaker.

The power-packed panel at the conclusion of the Summit included: CA Ameet Patel, CA Vaibhav Manek, CA Nilesh Vikamsey, CA Milin Mehta, CA Shariq Contractor, CA Druman Patel and CA Anand Bathiya. This diverse and multi-generational panel succeeded in providing thought leadership on various issues relevant to the Management of Professional Services Firms.

The speakers adeptly conducted each session, which kept the audience engaged throughout. The knowledge areas imparted is highlighted in a nutshell below:

–    Change management.

–  Infusing technology in day-to-day professional engagements for efficient management.

–    Valuable leadership qualities.

–    Growth strategies for professional firms in non-metro cities.

–    Succession planning and its invaluable importance.

–    Insights into the management challenges of mid-sized firms.

–    Strategies for accelerated growth for multi-generational firms.

The Summit generated immense interest among the participants in learning the art and science of practice management.

TRAINING SESSION FOR CA ARTICLE STUDENTS’ ON “ICAI NEW SCHEME FOR CA COURSE”

The only constant in life is change, and to keep up with the pace of change happening in our profession, ICAI has come up with New Scheme for CA Course. To address the doubts arising in the minds of students, the Students Forum, under the auspices of the HRD Committee, organised a session on the Topic “ICAI New Scheme for CA Course” on 12th June, 2022 via zoom. The session was led by CA Hrudyesh Pankhania, a proficient speaker on the subject.

Ms Anushree Shah, Student Coordinator, introduced the programme to the participants. It was followed by CA Jigar Shah, Convenor of HRD Committee, who addressed the students. Ms Divya Rai, Student Coordinator, introduced the speaker.

CA Hrudyesh Pankhania, in his detailed presentation, covered various aspects of the ICAI New Scheme.  He spoke about the need for change, online paced modules, new optional subjects, the impact of the new course on existing students and also the timeline for implementation. He meticulously explained the issues with practical examples and provided useful tips to focus upon.

The session was interactive; the speaker answered most of the queries raised by the participants. The session ended with Student Coordinator, Ms Divya Rai, proposing a vote of thanks. The topic’s importance could be easily seen based on the tremendous response to it from students. Overall, 80+ students participated and benefited from the session. For viewing the session,  visit the society’s:

Youtube Link:
https://www.youtube.com/watch?v=Yp7lOu9RUvY

INTERNAL AUDIT CONCLAVE: RE-IMAGINE!

After a long 2-year wait, the Internal Audit Committee held its flagship event – the Internal Audit Conclave, on 16th and 17th June, 2022 via physical mode at the Orchid Hotel in Vile Parle, Mumbai. The event was designed to cover various facets of internal audit with an innovative, interactive and practical approach delving into the event theme– “Internal Audit Conclave: Re-imagine”.

81 enthusiastic Internal Audit (IA) professionals from industry, as well as practice, joined the Conclave, of which 8 participants (10%) were from cities out of Mumbai. 60% of the participants were below the age of 40 years, and 30% of the participants were women professionals.

CA Abhay Mehta, President-BCAS, welcomed the participants on a monsoon morning on Day 1. He shared his views on the BCAS Internal Audit Committee’s vibrant programs and expressed his best wishes to all participants. CA Nandita Parekh, Co-Chair – IA Internal Audit Committee, then addressed participants with a delightful poem on the journey of an Internal auditor, which set the tone for the Conclave.

The keynote address on Day 1 was given by CA Uday Khanna, a well-reputed and seasoned professional with decades of experience. His address focussed on expectations from the IA professionals and Internal auditors, followed by an interactive Q&A session with a zealous audience. The events which followed on Day 1, along with key highlights of each event, is as follows:

Sr. No. Session details Speaker and Panelist details
1 Panel discussion on: “Addressing the expectation gaps: Building Bridges” CA Purvi Malani

CA Milan Mody

CA Mrugesh Shah

CA Jyotin Mehta

CA Ashutosh Pednekar

CA Nandita Parekh (Anchor)
This panel discussion focussed on prevalent expectation gaps between in-house IA team and outsourced IA team. The panel, with a combined experience of more than five decades, provided participants with practical solutions to address this gap and enhance overall IA service. The Q&A session allowed participants to raise real-life challenges faced, to which the panellists provided relevant solutions.
2 “Internal Audit: Acing the Fine Balancing Act” CA Anuja Ramdasi
The session shed light on how the internal auditor should balance resources and nurture an agile and energized audit team ready to serve a global or growing company.
3 “Forensics – Picking up the Early Warning Bells: A short film followed by an interactive session – introducing a new way of learning” CA Chetan Dalal
This session shared an innovative way of learning forensic techniques. All participants very well appreciated the real-life case studies and practical solutions shared by the speaker*.

(*) The session on forensics gave the participants a glimpse into an innovative way of learning. Feedback obtained at the end of Day 1 revealed that at least 92% of the respondents were interested in enrolling on such video and real-life case study based training sessions in future.

On Day 2, CA Murtaza Kachwala, Chairman – WIRC, a seasoned IA professional, gave the keynote address and shared his vision for the IA practice and the impressive agendas planned for IA professionals in upcoming years. The events which followed on Day 2, along with key highlights of each event, was as under:

Sr. No. Session details Speaker and Panelist details
1 “Bridging the Technology Divide: from Terrified to Terrific” CA Nikunj Shah
This session addressed the very pertinent need of internal audit, which is the use of technology. The speaker shared his insights and solutions on how technology can be adopted by Internal Auditors to manage obstacles and move from finding technology “Terrified” to “Terrific”. Practical anecdotes shared by the speaker helped participants envisage their shift into the next stage in technology adoption for internal audits.
2 “Auditing Related Party Transactions – The regulations are getting tighter, are you up to speed” CA Milan Mody
The session took a deep dive into understanding the auditing of RPTs, a space which has been subject to changing regulations and enhanced requirements over recent years. The speaker shared his insights on governance, processes and reporting checks, which an internal auditor should do to meet the Board’s expectations and provide greater degree of assurance.
3 Session followed by a panel discussion on: “Let’s talk Risks – Why an Internal Auditor should understand key risks? A deep dive into Data Risk, Climate Risk and Talent Risk” Mr. Anirban Ghosh

Ms. Shivangi Nadkarni

CA Hersh Shah

CA Prajit Gandhi (Anchor)
CA Hersh Shah kicked off this session by sharing his insights on various types of risks faced by organisations, along with very interesting statistics in today’s scenario. Ms. Shivangi Nadkarni, an expert in data risks and security, shared her thoughts on data privacy and vulnerabilities in today’s scenario. Later, Mr. Anirban Ghosh shared his passion and vision in today’s sustainability drives initiated by top Indian companies and what role various stakeholders, including internal auditors, play in this emerging drive.

After the opening address by the above speakers, a panel discussion was anchored by CA Prajit Gandhi on the importance of focusing on talent, data and climate risk, the role of auditors and key opportunities for IA. An interactive Q&A session was held towards the end of the panel discussion.

The participants made the most of the tea breaks between sessions, interacting with the esteemed speakers, committee members and fellow participants while being equally eager to return and attend the next session. The overall feedback from the participants was very positive and encouraging. The selection of topics, subject matter experts and speakers invited, and the overall event flow were some aspects of the encouraging feedback shared by a majority of the participants.

The closing remarks on Day 2 was given by CA Nandita Parekh, wherein she expressed her gratitude to all esteemed speakers, panellists, committee members and participants for making the Conclave a grand success! The general pulse of the room towards the end revealed that the Conclave delivered on its promise –to ensure that the Internal auditor who walked in at the beginning of Day 1 was different from the one who walked out at the end of Day 2!

FEMA STUDY CIRCLE

BCAS held its second FEMA Study Circle for the year on 24th June, 2022 via Zoom. The meeting was led by Mr. Bharat Sharma, Advocate on Record, Supreme Court. Mr. Sharma took a session on the implications of FEMA on Digital Assets. Needless to say, transactions in digital assets operate in a realm of their own and are more often than not shrouded in mystery.

The session started with an introduction to Digital Assets, their evolution and their background. Pursuant to this, he explained the different types of transactions that can be undertaken using digital assets, namely payment and receipts in cases of import and export, purchase and sale of fiat currency, as well as swap of digital assets and the implications of FEMA. He then touched upon the applicable definitions of FEMA and explained the rationale behind such transactions being considered either as goods or services. During the presentation, he touched upon the validity of digital assets from a legal and tax perspective, as well as the genesis of cryptocurrencies.

The presentation was followed by an intellectual discussion with members who discussed and debated the classification of such transactions from the FEMA perspective, as well as the practical approach taken by bankers while remitting funds abroad for undertaking such transactions. This discussion along with the questions posed by the members further brought out the nuances of such transactions from the FEMA perspective. Hopefully, this session would have helped clear the doubts of members on a topic that till then was something that all had heard a lot about, but a very few took the efforts to delve deep into it and understand its ramifications and it’s regulatory framework. And most rightly so, given the lack of recognition by Indian authorities and the number of transactions being few and far between.

11TH RESIDENTIAL STUDY COURSE (RSC) ON IND AS

The Accounting and Auditing Committee of BCAS organised this eagerly awaited 11th Residential Study Course (RSC) on Ind AS (in physical mode) at Deltin Hotel, Daman from 24th to 26th June, 2022. Attended by more than 60 participants from across India, The RSC comprised 2 engaging papers for group discussion, 3 interesting presentation papers and an excellent panel discussion.

Day 1
The RSC  started with a group discussion on Case Studies related to Impairment of Financial and Non-Financial Assets (paper writer CA Sachin Khopde). It covered the identification of CGUs, determination of discount rates, impairment assessment due to geo-political challenges, ECL provisions and various related matters.

Post the group discussion, the Chairman of the Accounting and Auditing Committee, CA Manish Sampat, gave his opening remarks and traced the history of the previous RRCs. He invited President CA Abhay Mehta to give his welcome address and inaugurate the RRC.

Welcoming the participants, CA Abhay Mehta indicated that the topics selected for the RSC were of great importance to the accounting and auditing fraternity and requested  the participants to derive maximum benefit from the course. Thereafter, Vice President CA Mihir Sheth also addressed the participants and gave his best wishes for the success of the RSC.

This was followed by a presentation on “Case Studies on Impairment of Non-financial and Financial Assets under IND AS 36 and IND AS 109 (including COVID lockdown, international geo-political scenario and market challenges)”. CA Raj Mullick, Chairman of the session, introduced the paper writer CA Sachin Khopde, who thereafter made his presentation on the various case studies and explained the nuances involved. He made the session very interactive and engaging. Thereafter, CA Raj Mullick, in his closing remarks, shared practical insights and challenges on various aspects related to impairment like goodwill impairment, determining CGUs etc. CA Amit Purohit concluded the session by proposing a well-deserved vote of thanks to the paper writer for preparing and dealing with excellent case studies and to the Chairman for sharing his valuable insights.

Day 2

The day commenced with a group discussion on “Case Studies on Revenue Recognition under Ind-AS-115 in case of new age businesses” covering various aspects like loyalty programmes, gift cards, web-based services, telecom and media based services, contract acquisition costs and other related matters.

This was followed by a session on “Learnings from Implementation of Revised Schedule III and CARO 2020” by CA Jayesh Gandhi. CA Shushrut Chitale, Chairman of the session, introduced the speaker who thereafter covered various practical aspects and implementation challenges on the topic.

The speaker concluded the session by indicating that many of the changes are a result of recent irregularities observed, would provide useful information to banks and other regulators and would warrant changes in digital and manpower requirements at audit firms. CA Nikhil Patel proposed a well-deserved vote of thanks to the speaker and the Chairman.

This session was followed by a presentation on case studies on revenue recognition by CA M.P. Vijay Kumar, in which CA Vijay Maniar, Chairman, introduced the speaker, who made an engaging presentation and also satisfactorily answered all the questions raised by the participants. CA Rajesh Mody concluded the session by proposing a well-deserved vote of thanks to the speaker.

In the day’s final session, CA Zubin Billimoria introduced the speaker CA Kishor Parikh, who presented  “Sustainability Reporting – A New Paradigm in Reporting”. The speaker  provided a broad overview, including a pictorial presentation on matters related to ESG / Sustainability Reporting.

CA Gunja Thakrar concluded the session by proposing a well-deserved vote of thanks to the speaker and the Chairman.

Day 3

The day commenced with an interesting presentation by CA Ashutosh Pednekar on the topic of “Non-Compliance with Laws and Regulations (NOCLAR) –  Understanding and Implementation Challenges”.  CA Rajesh Mody introduced the speaker.

CA Nikhil Patel concluded the session by proposing a well-deserved vote of thanks to the speaker.

Then, as a tradition and a happy memory, a group photograph was taken of all the participants, event organisers and speakers.

The final session was a  panel discussion on  “Valuation of start-ups- Bubble or Reality”, moderated by CA Anand Bathiya. The elite panel comprised  CA Paresh Clerk, CA Dipen Mehta, CA Nitesh Bhuta and Shreyas Trivedi, representing the interests of the Auditor, Investor, Valuer and Merchant Banker, respectively. The session involved an interesting discussion on providing a 360-degree view of the entire start-up ecosystem.

The RSC then concluded with closing remarks by the Chairman. He thanked all who contributed to making the RSC a grand success. He invited a few participants (attending the RSC for the first time) to share their experience. The RSC concluded with happy memories and knowledge enrichment for all the participants.

SOCIETY NEWS

WORKSHOP ON TRANSFER PRICING

The International Taxation Committee organised a day-long workshop on transfer pricing on 9th November, 2019 at the BCAS Conference Hall. It received a very good response, with more than 80 participants attending the event.

After President Manish Sampat’s opening remarks, International Taxation Committee Chairman Mayur Nayak presented a brief overview of the workshop and introduced the first speaker.

Several key topics were taken up for discussion at the workshop. Mr. Bhupendra Kothari was the first speaker. He highlighted various aspects of profit attribution and transfer pricing analysis. The session was interactive. Mayur Nayak, who chaired the session, also gave his insights on several key issues.

The next to speak was Siddharth Banwat who took the participants through the bench-marking in the case of intra-group financing transactions such as loans, guarantees, preference shares, debentures, letters of comfort and so on. He also highlighted various points to be kept in mind while undertaking a bench-marking exercise. The session was chaired by T.P. Ostwal who offered some practical insights on the subject.

Akshay Kenkre was the third to speak and discussed the subject of bench-marking of contract manufacturing, R&D / Services / LRD. He threw light on some of the typical challenges faced while undertaking bench-marking of the entities taking up such activities. Sushil Lakhani (who chaired the session) came up with a few more inputs.

The fourth and last speaker was Mr. Umang Someshwar who addressed the subject of safe harbour rules and documentation, the reporting requirement u/s 92E of the Act and also CBCR. Apart from this, he also discussed the challenges faced in documentation pertaining to management fees and other types of transactions. Mayur Desai, the session Chairman, offered further insights on safe harbour and documentation.

THE ART OF NETWORKING

The Human Resource Development Committee Study Circle organised a session to discuss the subject of ‘Networking Skills – The Art of Networking’.

As the catch line goes, ‘In today’s world “It’s not WHAT you know but WHOM you know that matters”.’ The success of LinkedIn is the biggest proof of this. Networking provides one with a great source of connections and opens the door to talk to highly influential people that one wouldn’t otherwise be able to find, let alone talk to.

Robert Kiosaki once said that the richest people in the world look for and build networks, everyone else looks for jobs.

To open these and many other doors of opportunity for our members, the HRD Study Circle organised a networking event along with a training session on ‘How to Network effectively for Success’ hosted by a networking expert, Ms Rupeksha D. Jain, the founder of GroomIndia. It was conducted at the BCAS Hall on Tuesday, 12th November, 2019.

The presentation took the participants along on a practical networking session, clubbing it with tips and techniques for networking. The session helped provide answers to questions such as ‘What is Networking?’ ‘Why Network?’ and ‘How to Network?’

Ms Jain hammered home the point that being competent at work and having vast knowledge was not enough. It was more important to possess the ability to build and nurture relationships; to build an image; to have a reputation; and to be considered credible.

A good corporate network can sense the ‘temperature’ of an organisation before the evidence filters out through official channels. Co-operation and collaboration across departments and to be the conduit of information and understanding of behaviour were important markers.

Therefore, to succeed in life, one must know the ‘Art of Networking’ as it can help professionals achieve far more than they can imagine, Ms Jain concluded.

TECHNOLOGY INITIATIVES COMMITTEE

The Technology Initiatives Committee organised a half-day programme on ‘Automating Audit to Save Time and Reduce Risk’ at the BCAS Conference Hall on Thursday, 14th November, 2019.

It was inaugurated by Raman Jokhakar. He explained the various regulatory compliances involved in audit engagements and described how these could be automated through the use of various audit automation applications. He also shared information about some of the applications currently being used by various professionals to automate engagements.

Mr. Kris Agarwala and Mr. Shashank Bokade from Wolters Kluwers India then proceeded to introduce the audience to the audit automation tool of Wolters Kluwers though a live demonstration of the software. They highlighted how the application would automate and digitise the handling of audit files and dealing with paperwork, especially when practices are spread across different locations and / or have a peer review by another partner from a different office; how the application was enabling audit documentation that would stand up to quality inspection and legal challenges; and how automation would further enhance the responsibility of auditors in substantiating how they have conducted their audits.

Their presentation was followed by a panel discussion moderated by Abhay Mehta in which Raman Jokhakar, Mr. Kris Agarwala and Chirag Doshi discussed the subject and shared insights on the opportunities for Robotics Process Automation to assist audit; how RPAs would impact in driving value internal / external audit; scalability of audit automation and the challenges faced in audit automation; and also their experience of the benefits that could be derived from audit automation.

The session was highly interactive and the speakers demonstrated:
(i) Tools and functions of the audit automation software;
(ii) Varied reports and dashboards generated for engagements; quality and review;
(iii) The ease of use of audit automation software.

The participants in the workshop learned new ways of working more effectively in an evolving audit regulatory environment. All questions raised from the floor were answered diligently.

SUBURBAN STUDY CIRCLE AND TECHNOLOGY INITIATIVES STUDY CIRCLE

The Suburban Study Circle along with the Technology Initiatives Study Circle organised a joint meeting on ‘Transfer Pricing Databases and Softwares – Advantages and Features’ on 16th November, 2019.

The main speaker at the meeting was Naman Shrimal who made a detailed presentation on the parameters to be considered for transfer pricing (‘TP’) report and transfer pricing software – ProwessIQ, Ace-TP and Capitaline-TP. He explained the importance of preparing TP reports and the parameters to be included in the report, along with a brief overview of each prescribed methodology of TP.

He took the audience on a journey of searching transactions for transfer pricing through a live demonstration of ProwessIQ software and provided insights into key terms and search parameters to be considered while selecting transactions for bench-marking. He also highlighted the pros and cons of each software and shared his experience of using each of them – ProwessIQ, Ace-TP and Capitaline-TP – which are currently prescribed by the Transfer Pricing Officer.

The speaker offered many practical examples to explain various features of the software, sprinkling his presentation with humorous quips to sustain the audience’s interest. He answered all the questions put to him as his presentation progressed, rather than first completing his talk and then inviting questions.

RELATED PARTY TRANSACTIONS

The Corporate and Allied Laws Committee organised a half-day seminar on ‘Related Party Transactions’ in the Babubhai Chinai Hall of the IMC on 16th November, 2019. It attracted a very good response, with more than 85 participants both from the profession as well as industry attending.

The ball was set rolling by President Manish Sampat who described some of the intricacies in related party transactions across different statutes and the alarming frauds taking place in the corporate sector under the façade of such related party transactions.

Anand Bathiya kicked off the proceedings with his masterly analysis of related parties and related party transactions across different statutes, including the Companies Act, Ind AS, the Income-tax Act, SEBI Regulations, Transfer Pricing Regulations and the Insolvency and Bankruptcy Code.

Zubin Billimoria moderated the second session, a panel discussion in which Dolphy D’Souza, Mr. Sharad Abhyankar (advocate) and Yogesh Thar took part. The panel pondered over various issues relating to the intricacies and complications involved in entering into related party transactions. Many subjective issues such as significant influence, associated enterprises, accustomed to act and ordinary course of business were deliberated upon. The panellists also emphasised the crucial role of audit committees in approving related party transactions.

Finally, the floor was thrown open for questions and all the panellists took turns to answer the queries posed by the participants.

FEMA STUDY CIRCLE

The FEMA Study Circle meeting was held on 19th November, 2019 when Mr. Natwar Thakrar led the discussion on the topic, ‘FEMA for Individuals’. A large number of members participated in the meeting.

The Group Leader deliberated upon various nuances of determining the residential status of an individual; the definitions of NRI, PIO and OCI were also discussed at length along with some relevant case studies.

Mr. Thakrar also covered all the regulations related to individuals as covered under FEMA 20R and the purchase of immovable property. Recently, there have been some new amendments in the regulations which the Study Circle plans to cover in its upcoming meetings.

LECTURE MEETING ON TAXATION LAWS (AMENDMENT) ORDINANCE, 2019

A lecture meeting on ‘Taxation Laws (Amendment) Ordinance, 2019’ was held on 20th November, 2019 at
the BCAS Conference Hall. The guest speaker was Bhadresh Doshi.

President Manish Sampat introduced the speaker and in his opening remarks explained the vision and the various activities of BCAS. He also touched upon the Indian economy, GDP growth and the impact that taxation laws can have on them while describing broad features of the Taxation (Amendment) Ordinance, 2019.
Bhadresh Doshi took the discussion forward and explained some of the major announcements in the Taxation Laws (Amendment) Ordinance, 2019 as under:

(i) Reduction in the rate of surcharge for individuals and foreign institutional investors;
(ii) Corporate tax rate reduction to 22% for domestic companies and a further reduction in tax rate to 15% for the companies registered on or after 1st October, 2019 and starting operations on or before 31st March, 2023;
(iii) Amendment to section 115BA and corresponding changes in section 115BAA and section 115BAB;
(iv) Changes in Minimum Alternate Tax within the meaning of section 115JB of the Income-tax Act, 1961. The rate has been reduced to 15% from 18.5%. Companies exercising their option u/s 115BAA and section 115BAB have been excluded from the applicability of section 115JB.

He touched on taxability of transactions related to buy-back of shares within the meaning of section 68 of the Companies Act, 2013 announced on 5th July, 2019. The Finance (No. 2) Act, 2019 had extended the application of Income Distribution Tax (IDT) vide section 115QA of the Income-tax Act, 1961. The speaker informed the gathering that tax on buy-back of shares (being shares listed on a recognised stock exchange) was not applicable on shares for which the public announcement was made before 5th July, 2019. In his presentation he also discussed and explained various topics such as (a) rollback of surcharges, and (b) booster package for corporates and their significant changes under sections 115BAA and 115BAB.

The speaker also explained related topics such as tax computation, surcharge computation, section 115BAB – Tax on income of individual new domestic manufacturing companies – and section 15BAA and their eligibility and MAT credit, etc.

The meeting was followed by an interesting question-answer session, with the speaker responding to all the queries raised by the participants.

Joint Secretary Mihir Sheth proposed the vote of thanks.

DIRECT TAX LAWS STUDY CIRCLE

The Direct Tax Laws Study Circle organised a meeting on ‘Assessment Proceedings – Making Representation in E-Proceeding Environment’ on 21st November, 2019.

Group leader Kinjal Bhuta divided the session into two parts: (i) Phase 1 – E-Assessment, and (ii) Phase 2 – the E-Assessment Scheme, 2019.

In Phase 1 she gave the background of the e-assessment process along with a chronology of events. She also took participants through the relevant provisions of the Act, the Rule and the CBDT instructions on e-assessments. She offered practical insights on various challenges faced while undertaking e-assessment proceedings and aspects that should be kept in mind while undertaking the e-assessment.

For Phase 2, she explained the recent E-Assessment Scheme 2019 notified by the CBDT through a process flow chart.

Kinjal Bhuta took questions from the group throughout the session to ensure maximum interactivity. Before concluding, she gave some tips and points to be kept in mind when undertaking assessments electronically.

The session concluded with a vote of thanks.

FIRST INTERNAL AUDIT RESIDENTIAL REFRESHER COURSE (IARRC)

In recognition of the expanding role of Internal Audit (IA) in corporate India, the BCAS constituted a new Committee for the year 2019-20 focusing only on Internal Audit.

The President, in his Annual Plan presented at the AGM, had expressed a desire that the Internal Audit Committee of BCAS organise an Internal Audit RRC. The maiden IARRC held at Rhythm Hotel, Lonavala, on 21st and 22nd November, 2019 was the culmination of the Committee’s efforts to make this wish come true.

The theme of the first IARRC was ‘Let’s Converge’. The Committee felt that with the emergence of IA as a key organisational function and an important area of professional practice, there was a need for convergence of ideas, technology and methodology.

The participants were welcomed on the first day of the event by President Manish Sampat. He stated that his annual plan had factored in the emerging areas of practice and he was privileged to host the 1st Flagship Event in his year as President.

IA Committee Chairman Uday Sathaye also welcomed the participants and explained the concept of RRC as originally conceived by BCAS and how it added value to the professional life of BCAS members by active participation.

Co-Chair Nandita Parekh gave a brief speech highlighting the theme of the IARRC, the programme schedule, the case study, the group discussion methodology and other arrangements. She also acknowledged the contribution of the Paper-Writers, Group Leaders, speakers and participants (82 from 12 locations) in making the event possible.

The first session was anchored by Mr. V. Swaminathan, Head, Corporate Audit & Assurance, Godrej Industries Limited. He presented a case study focusing on the need for the IA function to transform itself to meet the changing needs of organisations. He gave his insights on the case study, ‘Collaborate to Accelerate’.

The key take-away for the participants from the group discussion was to ‘Focus on the problem first before giving solutions’. Group Leaders were given an opportunity to summarise the views presented in their respective groups. Mr. Swaminathan made a powerful presentation with his detailed understanding of the issues at hand along with various pointers and solutions.

In the second session a paper on ‘Demystifying Cyber Risks’ was presented jointly by Ms Shivangi Nadkarni and Mr. Sameer Anja, co-founders of ARRKA, specialists in Data Privacy and Info Security. In their presentation they explained how it was easy to understand the various dimensions of cyber risks and the challenges related to data privacy and data ethics.
The third session had Mr. Mario Nazareth, Head, Internal Audit, Mahindra Group, presenting his views on ‘Reports and Presentations – How do we write / present to communicate effectively’. He captivated the audience with quotes, stories and insights based on his long innings in IA. The cartoons and anecdotes that were part of his presentation made the session quite lively. He concluded by imbibing the spirit of the IARRC theme, ‘Let’s Converge’, by suggesting adoption of common indicators and rating / grading terminology.

The day ended with a musical programme with singers regaling the audience with both old and new songs to match the age profile of the gathering. The highlight was a brief skit in which the members of the Committee presented different situations faced by Internal Auditors – and the singers came up with a suitable number to match each situation!

On the second day the proceedings began with a group discussion on a case study ‘Internal Audit: Covering the World from India’ based on a paper by Mr. Mukundan K.V., Chief Assurance & Risk Executive at Allcargo Global Logistics Limited. He dealt with the issues raised by the Group Leaders and gave practical solutions based on his experience.

The next session was a ‘first’ of its kind – a TedTalk-styled session on ‘Value Additions / Cost Savings Through Internal Audit’ by Mr. Bhargav Vatsaraj, Ashutosh Pednekar and Himanshu Vasa. Each one of them presented his views with relevant examples on the subject, highlighting their experiences and narrating their own stories. The session provided many take-aways to the participants for immediate use in their respective IA engagements.
The final session was a presentation paper on ‘Internal Auditors: Developing Antennas to Spot and Investigate Frauds’ by Chetan Dalal. He mesmerised the gathering with real-life stories and experiences. The session concluded on a very positive note with just one request – Yeh Dil Maange More!

All the participants were requested to give their feedback; and then a vote of thanks was proposed to the speakers, the participants, the BCAS staff and the hotel management. The participants bid goodbye to one another with a commitment to ‘Collaborate, Converge and Meet’ again next year. The IARRC succeeded in creating a positive impact and proved to be a unique learning experience.

LECTURE MEETING ON INSTITUTION BUILDING AND CORPORATE AYURVEDA

A lecture meeting on ‘Institution Building and Corporate Ayurveda’ was held at the BCAS Hall on 27th November 2019. Mr. R. Gopalakrishnan was the guest speaker. The meeting was attended by more than 75 members in person and was very well received.

Welcoming him and the members present both in person and online, President Manish Sampat gave his opening remarks on the bespoke topic chosen by the speaker. He explained the definition of institutions and said that great institutions are not built overnight but require hard work, perseverance and vision. He then introduced the speaker who had corporate experience of more than 52 years with some of the most valued and respected corporates; that was more than the age of those who were keen to listen to his lecture!

He informed the speaker that in March, 2019 his book Crash was reviewed in the BCAS Journal and presented him with a copy of the Journal carrying the review. Inviting the guest speaker to address the audience, he said that people were eager to know how companies could stay young despite their age, what it took to build institutions and whether there was any corporate mantra that could identify the ‘shapers’ of business.
Mr. Gopalakrishnan introduced his subject in a reflective mode, narrating his extensive experience in the corporate world in various senior positions. He said institutions needed to be differentiated from large companies just as one would differentiate monuments from large buildings. Monuments become institutions in themselves not just by the size but by the vision, intent and scale of their magnitude and contribution to society. This was how the shapers of the institutions stood out from the leaders. While leaders build successful businesses, shapers build them to last with success, turning them into institutions. In that context, he said that one needs to reflect on what institution builders do and what we can learn from them. Elaborating on the subject, he said that society had three types of people: Those who ‘Defend’, those who ‘Advance’ and those who ‘Earn’. Giving examples of each type, he explained that a nation needs the army and bureaucrats to defend the nation and the government. There are, on the other hand, people who are teachers, scientists and artists who advance the nation culturally. However, in order to support these two important constituents it is extremely important to harness those who can earn money. Business assumes this responsibility. Companies provide employment, pay taxes and contribute in the development of the country by supporting all three sections. However, out of these, those founded on strong principles and ethical values become institutions as their founders had the vision not only to earn money but to make them long-lasting to contribute to nation-building.

He then classified businesses into categories. On the one hand were companies which were successfully run and existed for more than 50 years and that had become institutions in themselves for various reasons. It would be safe to hazard a guess that they would enjoy long life even in future. They could be classified as ‘Gen C’ companies. On the other hand, there were companies which could be classified as ‘Gen L’ (companies that prospered in liberalised regimes) that have the potential to become institutions. However, both these types shared some common traits that earned them the privilege of becoming institutions. He expanded the concept by elaborating three management activities.

These were:
(i) Managers who just manage. They are junior-level personnel who just carry out management tasks and instructions;
(ii) Intervening management. They are middle- to senior-level managerial personnel who are involved in conflict management and aligning various factions to the direction that the organisation has adopted;
(iii) Top-level management whose function is to anticipate, give vision and direction to the organisation.

Mr. Gopalakrishnan then stressed that it is the strength of the third level of the management that can transform a successful business into an institution. This can happen by successfully focussing on some key areas such as:

(a) People relations, viz., respect, talent recognition, putting the right people for the right task;
(b) Short-term as well as long-term goals;
(c) Ability to do critical yet lateral thinking. Willingness to look at a challenge in a completely detached manner from outside and offering solutions beyond visible options on the plate by critically thinking what is the problem a part of, rather than just focussing on solving the problem;
(d) Breaking barriers without sinking the boat;
(e) Identifying levers of change;
(f) Orbit-changing that will change the trajectory;
(g) Understanding efficiency vs. effectiveness; and
(h) Act and take calculated risks rather than procrastinate and be in a witness mindset.

He then went on to draw a parallel between Ayurveda and the health of a company to suggest a remedy for a long life. Ayurveda attributed a long life to certain practices and thought patterns that one adopts in one’s life. Pulsating energy while living, continuous cultural advancement and ‘Eudomania’ (a persistent feeling of being well) were the secrets of a long life for an individual. Similarly, for organisations to live long there are certain practices that global companies adopt which help them to become institutions. He revealed that he was privileged to have studied Japanese, European and American companies and had noted the following practices that had helped them:

(1) Clear values and mission statement;
(2) Strategic and long-term approach;
(3) Human focus;
(4) Socially minded in building nation;
(5) Innovative, open to new ideas, adaptive;
(6) Eager to cultivate culture;
(7) Frugal yet adventurous for right spend; and
(8) Aligned in body, mind and soul, i.e., giving 100 % to achieve the vision set.

Concluding his talk, Mr. Gopalakrishnan said that while successful companies and leaders who build them are equally important, what makes a difference in society is the ability of ‘shapers’ who have the vision, passion and tenacity to turn successful business ventures into institutions that outlive their founders.

The meeting was followed by a question-and-answer session in which the speaker responded to all the queries raised from the floor of the house.

Joint Secretary Mihir Sheth proposed the vote of thanks.

ALL INDIA FEDERATION OF TAX PRACTITIONERS

A two-day National Tax Convention was organised by the All India Federation of Tax Practitioners (Western Zone) jointly with the Bombay Chartered Accountants’ Society (BCAS), the Chamber of Tax Consultants (CTC) and the Goods & Services Tax Practitioners’ Association of Maharashtra, Mumbai (GSTPAM) on 14th and 15th December, 2019 at Sahara Star, Mumbai.

The Convention was inaugurated by the Hon’ble Mr. Justice Ujjal Bhuyan of the Bombay High Court, along with the Hon’ble Mr. Justice P.P. Bhatt, President of the ITAT, and the Hon’ble Mr. P.H. Mali, President of the MSTT. Their words of wisdom were truly inspiring for all those present.

Welcome addresses were delivered at the inaugural session by the National President of the AIFTP, Dr. Ashok Saraf; the Deputy President of the AIFTP, Ms Nikita Badheka; the Chairman of the AIFTP-WZ, Mr. Deepak Shah; BCAS President Manish Sampat; the Vice-President of the CTC, Mr. Anish Thacker; and the President of the GSTPAM, Mr. Dinesh Tambde.

The Theme of the convention was ‘Complexities in Simplification’. It was organised with the aim of imparting education to members and to keep them abreast of important recent developments in Direct Tax and GST. There were five technical sessions and a panel discussion on various issues related to Direct and Indirect Tax. Delegates came from all over the country, with good participation from places such as Nagpur, Pune, Nashik, Sangli and Parbhani.

The speakers / paper writers for the technical papers were Mr. Mukesh Patel, advocate, Ahmedabad, Mr. Rahul Agarwal, advocate, Allahabad, Ms. Sujata Rangnekar, CA, Mumbai, Mr. Hiro Rai, advocate, Mumbai, and Mr. Umang Talati, CA, Mumbai.

Those taking part in the panel discussion were Mr. V. Shridharan, senior advocate, Mumbai, and Mr. Saurabh Soparkar, senior advocate, Ahmedabad; the moderator was Pradip Kapasi.

The speakers / paper writers had clearly put in a lot of hard work and their presentations were par excellence.

The Chairpersons for the various technical sessions, namely, Dr. K. Shivaram, senior advocate, Mumbai, Mr. Vikram Nankani, senior advocate, Mumbai, Mr. P.C. Joshi, advocate, Mumbai, Ms. Premlata Bansal, senior advocate, New Delhi, and Mr. Vinayak Patkar, advocate, Mumbai, shared their wisdom and expertise.

The topics selected were of every-day importance and were appreciated by all the delegates. There was excellent teamwork and coordination between all the joint organisers and the core committee members of all the associations involved.

FINCON – ‘THE WAY FORWARD’

BCAS was proud to partner with the Rotary Club of Coimbatore Spectrum on this innovative initiative. It was held at the Residency Towers Hotel, Coimbatore.

The BCAS contributed as a knowledge partner to the financial conclave for entrepreneurs, business leaders and finance professionals styled ‘FINCON – The Way Forward’, organised by the Rotary Club of Coimbatore Spectrum at Coimbatore on 21st December, 2019.

The conclave was conducted with the dual purpose of raising funds for the Rotary Club and enhancing the knowledge of the participants. The funds raised are proposed to be utilised for the various community service projects of the Rotary Club.

The deliberations at the conclave laid special emphasis on the small and medium enterprises (SMEs) sector and all the participants came from the local SME sector. SMEs play a vital role in the country’s economic activity and development. Thus, incubating and developing SMEs helps in achieving equitable and sustainable growth of the overall GDP of the country.

While SMEs have their own unique set of issues and challenges, however, there is an opportunity behind every challenge, especially during the current slowdown. Additionally, there have been numerous changes in the law, particularly relating to direct tax and GST. Further, various procedural and technological changes have impacted the operations of businesses. Laws have been becoming more stringent and the cost of non-compliance is rising. The conclave aimed at addressing the above-mentioned challenges faced by the SME sector.

BCAS was represented at the FINCON by President Manish Sampat and four speakers from the Core Group, namely, Past President Gautam Nayak, Hon. Secretary Samir Kapadia, Managing Committee member Chirag Doshi and the Convener of the International Economics Study Group of BCAS Harshad Shah.

ICAI Past President G. Ramaswamy was the chief guest.
President Manish Sampat gave a detailed presentation on the Society’s contributions and spoke about its educational activities, training initiatives and publications. He also spoke about the various representations made by BCAS from time to time for enacting better laws, implementation and procedural aspects to ensure efficient and transparent governance.

Gautam Nayak spoke about recent issues and key developments related to the direct tax laws impacting the SME sector. He spoke about the new tax rate regime for companies, concessional rate of taxes u/s 80 JJAA of the Income-tax Act, 1961, deemed dividend [section 2(22)(e)], tax issues related to conversion of companies to LLPs, tax issues on the issue of shares at a premium by closely-held companies, start-up angel tax, and the recently announced faceless assessment procedures.

Samir Kapadia spoke about the recent updates relating to the GST Act and dealt with issues relating to new e-return filing procedures, the proposed e-invoicing process, amendment to Rule 36(4) and the recommendations made by the GST Council in its 38th Council meeting relating to the further restrictions proposed on input tax credit, blocking of e-way bill generation facility in case of default in filing GSTR1 and the notification regarding the last date for filing appeals under GSTAT.

On his part, Chirag Doshi spoke about recent developments in the Companies Act and compliance issues relating to private and small companies. He covered some key definitions and concepts and relief available to private and small companies.

Harshad Shah spoke about the present economic scenario and the way forward for businesses. He gave a glimpse of the global economic scenario, including some global headwinds as observed in countries like Germany, the UK, Japan, China, among others. He also covered the state of the US economy. Another aspect of his talk was a sector-wise analysis of the Indian industry, particularly auto, real estate, construction, exports and agriculture.
There was notable interaction after every session.

Arranging such events in association with other organisations and moving to other cities is part of the BCAS’s Annual Plan for 2019-20 ‘to enhance and increase its reach beyond professionals and the city of Mumbai’. By partnering in this event, the Society also contributed to a social cause to raise funds for laudable community service projects such as upliftment of the rural girl child with a single parent, providing solar electrification for tribal houses, construction of low-cost housing and many other similar causes.

Society News

11th Jal Erach Dastur CA Students’ Annual Day – ‘Tarang 2k18’ held on 9th June 2018

BCAS Students’ Forum under the auspices of HDTI Committee organized 11th Jal Erach Dastur CA Students’ Annual Day on 9th June, 2018 at K. C. College, Churchgate under the banner Tarang 2K18. In this mission, the Students’ Team embarked upon the journey with an apt theme ‘New India’ for Tarang 2k18. The Forum comprised of a fleet of 36 dedicated and enthusiastic students. The event was truly an event ‘OF CA students, FOR CA students and BY CA students’. It completely changed the personality perception regarding CA students while witnessing them as event managers, anchors, talented dancers and also photographers!

The theme of ‘New India’, as envisaged by our Hon. Prime Minister, focuses on innovation and improvisation. This year ‘Tarang’ reinvented its decade old elocution competition (sponsored by Smt. Chandanben Maganlal Bhatt Elocution fund) into Talk Hawk on the lines of the famous TEDx program. Also, this edition saw the reintroduction of Antakshari competition which had formed a part of the 1st edition of this event in 2008. The year set a new benchmark for ‘Tarang’ with the participation reaching a new high with 294 entries comprising seven different competitions.

The event commenced with a dance performance with lezim beats invoking the blessings of Lord Ganesha. It was followed by Ganesh Arti performed by CA. Narayan Pasari, President, BCAS who also paid tribute to Shri Jal E. Dastur along with the members of the Managing Committee & HDTI Committee.

The three finalist teams of the reinvigorated ‘Antakshari Competition’ named as ‘Deewane’, ‘Parwane’ and ‘Mastane’ were the first to occupy the stage. The Antakshari had fun-filled and innovative rounds to test quick thinking of the participants. Everyone were astonished to witness the talent of CA students even in the arena of Bollywood songs and trivia. The event was hosted by CA. Vijay Bhatt accompanied by CA. Meena Shah and Tej Bhatt.

The next event was ‘Talk Hawk’ (sponsored by Smt. Chandanben Maganlal Bhatt Elocution fund) wherein the three finalists had to give a 6 minute TED Talk on any topic of their choice. This enabled a level playing field for all participants who gave their impressive performances on their respective topics. During the Talk Hawk, the auditorium was graced by the presence of Senior Advocate, Shri Sohrab. E. Dastur who is a constant source of inspiration to this event.

Post Talk Hawk, the winning film of Short-film making competition – ‘The Screenmasters’ was played. The message of winning film – ‘Smile’ did moist eyes of the audience. This was the second year of the Short-film making competition and it truly scaled a new height. All the entries of short films had a beautiful message for the theme of ‘New India’ and were very precisely shot.

Next, the best photographs from the Photography Competition ‘Khinch Le’ were displayed. This event, too, was reinvented with a concept of ‘Public Choice award’ wherein photographs short listed by judges were put to vote on the Facebook Page and the photograph with maximum votes would be the winner. Participants were given themes on which they had to click creative photographs and post it on the Facebook Page with an innovative tagline based on the theme selected. This competition saw record participation of 75 entries and kept the Facebook Page thundering.

Thereafter, the stage witnessed a surprise entry of the Chief Guest of the evening – the witty Cyrus Broacha, a well-known TV personality and satirist, most popularly known for his show ‘MTV Bakra’ and ‘The Week That Wasn’t’. He used his gifted humorist skills to tickle the funny bone of the audience. He was felicitated by our President CA. Narayan Pasari and the event coordinator Parth Patani proposed a vote of thanks for Mr. Cyrus Broacha.

Then the time had ripened for the most awaited event of the evening – CA’s Got Talent. The singers had assembled, guitars and keyboards were in place, dancers were on their feet and actors began polishing their lines before they could thrill the audience with their mesmerising performances. To give a spirited kick start to this most awaited event, the students’ team presented a 4 minute flash mob which was choreographed by CA. Rishikesh Joshi.

And rightly then, the 12 performances in singing, dancing and other performing arts category enthralled the audience. The judges were fascinated, rather bewitched, by the talent of young CA students. They indeed had a mountainous task of choosing the winner.

With the clock-ticking, the participants began crossing their fingers as the ice was about to be broken. The winners of the competition representing their firms were finally announced. The list goes as follows:

Essay Writing Competition ‘Awaken the Writer Within’

Prize Name of Student Name of Firm
1st Prize Winner Kanika Mangal —————————–
2nd Prize Winner Rakshita Yadav CNK & Associates LLP
3rd Prize Winner Ronak Thakker Vyas  & Associates

Talk Hawk – ‘Aspire to Inspire’

Winner Gauri Kakraniya Singrodia Goyal & Co.
Rotating Trophy went to Singrodia Goyal & Co.

Talent Show ‘CA’s Got Talent’

1st Prize (Singing Category) Sagar Shah Raju & Prasad
1st Prize (Dancing Category) Niti Shah Mukund M. Chitale & Co.
1st Prize (Other Performing Arts Category) Vivek Rajpurohit Sara & Associates

Antakshari Competition – ‘Suro ke Sartaaj’

Winning Team Kasturi Kolwankar Natwarlal Vepari & Co.
Vaibhav Mandaliya D.H. Chheda & Company
Romil Goyal Gupta & Ashok
Best Individual Performer Khushbu Shah Mehta Chokshi and Shah

Sketch & Slogan Competition ‘Leave your Mark’

1st Prize Winner Kasturi Kolwankar Natwarlal Vepari & Co.
2nd Prize Winner Deevesh Chudasama Khandelwal Jain & Co.
3rd Prize Winner Romil Goyal Gupta & Ashok

Photography Competition ‘Khinch Le’

Judges’ Choice Prize Chinmay Jagtap M.P. Chitale & Co.
Public Choice Prize Sophia Pereira J.H.Gandhi & Associates

Short Film Making Competition ‘The Screenmasters’

1st Prize Winner Pratik Hingu and Team Bhikubhai H. Shah & Co.

Hearty Congratulations to all the winners and their firms.

Judges for the Various Competitions were as follows:

Competition Elimination Round Final Round
Essay Writing CA. Gracy Mendes and CA. Sangeeta Pandit
Talk Hawk CA. Vipul Choksi

CA.Mukesh Trivedi

 CA. Atul Bheda

CA. Mudit Yadav
Talent Show CA. Ryan Fernandes

CA. Devansh Doshi

 CA. Manori Shah

Shri. Nipun Nayak
Antakshari Competition CA. Toral Mehta, CA. Ryan Fernandes and CA. Kartik Srinivasan
Sketch & Slogan Competition CA. Raman Jokhakar and CA. Chirag Doshi
Photography Competition CA. Kamlesh Vikamsey and Mrs. Vineeta Muni
Short Film Making Competition CA. Divyesh Muni and CA. Rajesh Pabari

The entire evening was marvellously anchored by Mr. Kedar Pandey, Ms. Gauri Kakraniya and Mr. Nilay Gokhale with their sheer display of energy coupled with mind blowing performances. The anchors were also supported by Ms. Devyani Choksi and Ms. Preksha Shah in hosting the show.
Mr. Sahil Tanna proposed the well-deserved vote of thanks to Mr. Sohrab Erach Dastur for sponsoring the annual day in the fond memory of his brother late Jal Erach Dastur, the family of Smt. Chandanben Maganlal Bhatt for sponsoring the Elocution Competition, the members of the Managing Committee and HDTI Committee, the Coordinators of the Annual Day, the Event Moderators, Judges of various competitions, BCAS Staff and the vibrant team of student volunteers and all the students for participating in big numbers.

A scrumptious dinner was arranged after the event for all those who marked their presence at the annual day. Finally with a sense of satisfaction, joy of success, lasting motivation and with some unforgettable memories, it was called a day.

“Power Up Summit” held on 16th June, 2018 at Orchid Hotel, Mumbai

The Human Development and Technology Initiative Committee organised a one day programme “The Power Up Summit: Reimagining Professional Practice”, on June 16, 2018, at the Orchid Hotel, Mumbai. This Summit was in continuation of a series of Power Summits organised annually since 2011.

The Power Up Summit, conducted by a team of 3 faculty members, CA. Nandita Parekh, CA Ameet Patel and CA. Vaibhav Manek was attended by 73 members. The entire programme was conducted and well-coordinated by the faculty members in a seamless manner. The presentations were creative, colourful and intertwined with short videos that drove the points home in an entertaining manner.

The Summit raised important issues dealing with succession planning and sustainability of professional practices, the merger mathematics and valuation of professional practices, the challenges and opportunities arising due to technological advances and the need to get ready to “thrive” in these disruptive times, and not just survive.
The interest of the participants was evident in terms of the involved discussions and the incessant questions raised after each session. The Summit succeeded in generating a lot of interest among the participants in learning the art and science of practice management.

INDIRECT TAX STUDY CIRCLE

Indirect Tax Study Circle Meeting held on 16th June, 2018 at BCAS Conference Hall

Indirect Taxation Committee organised a Study Circle Meeting on 16th June 2018 at BCAS Conference Hall, to discuss the important definitions under the GST Law. The discussion was led by CA. Yash Parmar and the group was guided by CA. Naresh Sheth and CA. Rajat Talati. The Group discussed definition of “goods”, “services”, “aggregate turnover”, “taxable supply”, “exempt supply”, “non-taxable supply”, “composite supply”, “mixed supply”, “job work” and “works contract”. The importance of expression “unless the context otherwise requires ” used in the definition clause was also discussed. Related judicial pronouncements and Advance Authority Rulings were mentioned in the discussion.

The meeting was quite interactive and participants benefitted a lot from the session.

Celebration of International Yoga Day on 21st June, 2018 at BCAS Conference Hall

HDTI Committee, jointly with Indian Spiritual Healing (ISH) Foundation, organised a Yoga Session on 21st June 2018 at BCAS Conference Hall to mark the celebration of “International Yoga Day” which falls on the same day.
Mr. Pradeep Thakkar, a Professional Yoga teacher and also an active member of ISH Foundation guided the participants to perform different Asanas with ease, comfort for healthy body and mind relaxation. He also demonstrated some powerful Asanas to improve memory, maintain mental fitness and also to keep the body flexible and tone the muscles of the body.

Participants had good learning of Yoga Asanas for healthy body and peaceful mind.

Report on 12th Residential Study Course (RSC) on GST held at Kochi from 21st to 24th June, 2018

The 12th RSC of Indirect Taxation – GST was planned and organised by the Indirect Taxation Committee at Hotel Marriott, Kochi from 21st to 24th June, 2018. The Timing was perfect as GST law was nearing its first completed year after implementation. Looking at the complexity and frequent changes in the law, the RSC was attended by many delegates from various parts of the country. RSC was attended by 218 members.

The RSC for the first time was extended by a day to a 3 nights & 4 days course. The Course comprised of three group discussions on case papers prepared by eminent speakers and discussed by members in five different groups headed by group leaders. The Speakers also presented their views on the cases discussed by the members. The Group discussion and presentation of views of speakers was followed by presentation of two important topics by eminent speakers. The Highlight of the course was the Talk Show arranged by the Indirect Taxation Committee.
On the first day of RSC, post registration, there was a session of Group Discussion on Paper I by Adv. Rohit Jain on “Case Studies in Levy, concept of Supply with related schedules, Scope of ‘Business’ under GST (Including Mixed and composite supplies)”. The case study exhaustively covered the topic within the groups.

Subsequently, there was an inaugural session which commenced with the inaugural address by the President of BCAS, CA. Narayan Pasari. He briefly addressed the gathering and also gave a brief about the activities of BCAS and benefits to its members. Later, chairman of the Indirect Taxation committee, Deepak Shah gave introductory remarks on the design and structure of the course and the purpose of selection of the topics for group discussion as well as presentation. Thereafter, the keynote address was given by Mr. D.P. Nagendra Kumar D.G. (South) (GST), Chennai & Mr. Pullela N. Rao, Chief Commissioner, Kochi. Both the speakers got well connected to the participants and gave an insight into the provisions of the law and also responded to all the queries posed to them.

Second day started with Presentation of Paper I by Adv. Rohit Jain. All the questions were diligently covered by the speaker who well explained the concept of Mixed Supply, Composite Supply and Works Contract. Post that, the group got together for discussion on Paper II by CA. Divyesh Lapsiwala on “Place of Supply, Cross-Border transaction (including between states) under GST (including mixed and composite supplies)”. All the cases given by the presenter were well discussed and the points highlighted by the presenter were on day to day issues faced by the practitioners.

Post lunch, Presentation paper on “GST Audit and state of preparedness” by CA. Naresh Sheth was well articulated and reference material was given to all the members present, to work on GST Audit. He gave a framework for the professionals to conduct the audit and gave an exhaustive list of reconciliations for consideration.

A Talk show on GST related practice was also organised which was anchored by Vice President, BCAS, CA. Sunil Gabhawalla & Senior member CA. A.R. Krishnan and panel comprised of CA. Naresh Sheth, CA. Rajiv Luthia, CA. Divyesh Lapsiwala & CA. Jatin Harjai. All the four panellists were requested to share their preparedness for GST during the initial days of act coming into existence, the Working culture and best practices they followed. It was followed by a presentation paper on “Procedure under GST, Payment, Returns etc. – issues” by CA. Rajiv Luthia. The Speaker made a presentation on the issues related to the procedural aspects of payments & returns which covered a variety of problems faced with possible solutions. Day ended with entertainment program and authentic Kerala dinner called Sadhya.

Day Three started with group discussion on Paper III by Adv. G. Shivadass “Classification issues under GST, Works Contract and Job Work” pointing out various issues under classification, works contract and job work. After that, presentation of Paper II was made by CA. Divyesh Lapsiwala and his colleague. The speaker gave all his views on the topic and covered all the questions given in the paper book. It was followed by lunch and sightseeing for the participants with boat ride arranged by BCAS for all the participants. Last day started with presentation of Paper III by Adv. G. Shivadass who very well presented his thoughts and covered all the questions in the designated time.

The Concluding session was presided over by Chairman CA. Deepak Shah and he acknowledged contribution of the faculty and group leaders, as well as active participation of all participants and support from BCAS staff for the success of the RSC. Some of the participants gave their views on the course and conveyed their satisfaction at the format, topics covered and structure of the course. Participants were also quite happy and satisfied with the arrangements made by BCAS at the venue and learnt a lot from RSC sessions.

Lecture Meeting on “Transforming Mumbai – Challenges and Opportunities” held on 26th June, 2018

Bombay Chartered Accountants’ Society organised a lecture meeting on ‘Transforming Mumbai – Challenges and Opportunities’ on 26th June 2018 at Indian Merchants’ Chamber which was addressed by the guest speaker Mr Ajoy Mehta, Hon. Municipal Commissioner of Mumbai.

President, CA. Narayan Pasari, introduced the Speaker and gave the opening remarks while explaining the vision and various activities of BCAS including our 50th year Journal, Annual Referencer, Representations and social activities such as RTI, Charitable Trust and Accounting & Auditing Clinic etc. He also touched upon the subject with particular reference to challenges of transforming Mumbai and the role of MCGM and its good governance.

Mr. Ajoy Mehta, Hon. Municipal Commissioner of Mumbai took forward the discussion and explained the challenges and the opportunities to overcome those challenges of Mumbai. He started with the introduction of Mumbai and mentioned that Mumbai is having 476 Sq. Km. of area with population of 1.24 crore. If we leave aside the mangroves, roads and coastal regulatory zones etc., we are left with very little area for use of the public at large. So, he enumerated the following key factor attributed to Mumbai:

Area: He explained that going by the demographic history, the population growth has considerably reduced from 38 % increase in 1990-91 to 3.7 % in 2001-2011. Till 2021, we are going to see growth in population. As per 2034 vision, we feel that after 2021, population growth of Mumbai will drop because of the satellite cities like Thane, Vashi etc. developing fast. We just need to push infrastructure, transportation etc.

He also discussed how to deal with the issues which the local body (Corporation) faces while implementing the policies. There are two instruments namely. (i) Budget and (ii) Land Use to overcome the obstacles. He told that the Corporation has made the development plan for the next 20 years.

Further, the Speaker enumerated the key challenges being faced by Mumbai which need to be dealt with by MCGM aggressively viz. (i) Services (ii) Long Term Infrastructure (iii) Regulatory Roles ((iv) Employment Generation (v) Affordable Housing (vi) Social Equity Issues (vii) Water (viii) Waste Disposal (ix) Health Care etc.

The Hon. Speaker explained that the Corporation has made most of the services IT enabled like online payment, building permit etc. On the environment front, every tree in the city has been mapped and we are going to develop a very strong IT equipped engine to cover more services under its umbrella and thereby give better services.

Mr. Ajoy also explained about the ongoing projects like the Coastal Roadway and Urban Transport amongst others and the widening role of MCGM to cope up with the challenges ahead in meeting the infrastructure requirements of the Mumbai Metro City. He also emphasized the need for a futuristic outlook and vision, to prepare a draft plan to execute efficiently with the passage of time without any bottlenecks.

The meeting was followed up by Q&A session where the Speaker thoroughly responded to all the queries raised by the participants.

The participants were hugely enlightened with the insights provided by the Speaker.

Lecture meeting on “Filing of Income Tax Return for A.Y. 2018-19” held on 2nd July, 2018

A lecture meeting on topic “Filing of Income Tax Return for A.Y. 2018-19” was held on 2nd July, 2018 at K. C. College auditorium. CA. Devendra Jain dealt with legal aspects of Return Filing and CA. Divya Jokhakar dealt with procedural aspects of Tax Return Filing.

During his presentation CA. Devendra Jain discussed and explained various amendments of Finance Act 2017 relating to Rates of taxes, exemptions etc. He touched upon legal aspects of Income from House Property, Capital Gains, Business Income, changes in Depreciation, Other Sources etc.

CA. Divya Jokhakar in her presentation explained procedural aspects of Income Tax Return such as Applicable forms for various types of assessees, Mode of submission etc. She also updated the participants on the
latest changes in Income Tax Return.

Both the speakers replied to the questions raised by the participants.

The lecture meeting provided a hands-on guidance to the participants, many of whom were young members.

70th Foundation Day Lecture Meeting on “India – 2019 & Beyond” held on 6th July, 2018 at Garware Club House, Churchgate, Mumbai

A lecture meeting on “India – 2019 & Beyond” was held on 6th July, 2018 on the occasion of 70th Foundation Day of the Society which was addressed by CA. Nilesh Shah, MD, Kotak Mahindra AMC Ltd. President CA. Narayan Pasari briefly touched upon the perspective of India’s economic growth and shared the profile of Mr. Nilesh while welcoming the Chief Guest and then requested him to address the august audience.

At this occasion, BCAS publications: Thought Mailers – A Compendium Volume 1 & 2, Presumptive Taxation under sections 44AD, 44ADA and 44AE and BCA Journal – July 2018 were released by the hands of the Speaker CA. Nilesh Shah.

On the topic of the Lecture Meeting “India – 2019 & Beyond”, the Speaker explained the challenges to overcome to achieve the growth story of India beyond 2019. He lucidly drove the inherent challenges which India has to face on account of following: (i) India being equivalent to a continent, (ii) savings allocation being poor, (iii) Poor tax compliance (iv) Poor job creation (v) Global liquidity crisis (vi) Deteriorating macro outlook viz. crude oil, current account deficit, fiscal deficit etc. (vii) Credit squeeze.

He also discussed about basic market forces which are leading to the growth of economy and enumerated some of them as follows:(i) Increased Urban consumption, (ii) Overall increase in auto sales, (iii) Aviation sector doing well, (iv) Tourism growing fast, (v) MFI recovery in rural sector is good, (vi) Railways is on fast track, (vii) GST buoyancy, (vii) NPAs getting solved and (viii) PE Ratio being above average.

The Speaker further talked about the reforms of Modi Government which will contribute to faster development of the economy from 2019 onwards namely Lower inflation, Minimum Government-Maximum Governance, Free markets, Improving quality of public spending, Fiscal Prudence, Attracting FDI amongst others.

At the end, there was Q&A session where the Speaker responded in a pragmatic manner to the queries of the audience.

The audience got mesmerised with presentation skills of CA. Nilesh Shah and gained a lot from the insights from his spectacular speech.

SUBURBAN STUDY CIRCLE

Suburban Study Circle Meeting on “Provisions of ICDS Revelant to SME’s” held on 7th July, 2018

The Suburban Study Circle organised a meeting on “Provisions of ICDS Revelant to SME’s on 7th July, 2018 at Bathiya & Associates LLP, Andheri (E) which was addressed by CA. Namrata Dedhia.

The speaker CA. Namrata Dedhia made a detailed presentation on the provisions of ICDS which are specifically applicable to SMEs. The major points discussed were (a) Applicability of the ICDS and the background (List of ICDS notified) of ICDS which had its basis and comments from the Delhi HC ruling. (b) Major changes and recent developments (c) Other provisions of ICDS. The speaker also discussed what confusions are still around, the best available stand we should take to avoid penalties and non-compliance. The speaker shared practical examples on her experience with the clients and tax authorities.

The participants learned a lot from the presentation shared by the speaker.

BEPS STUDY CIRCLE

Meeting on “Disclosure Rules for CRS Avoidance Arrangements and Opaque Offshore Structures under BEPS measures” held on 7th July, 2018 at BCAS Conference Hall

International Taxation Committee organized a Study Circle Meeting on “Disclosure Rules for CRS Avoidance Arrangements and Opaque Offshore Structures under BEPS measures” on 7th July 2018 at BCAS Conference Hall which was led by Group Leader CA. Shweta Ajmera.

The group leader explained about BEPS Action Plan 12 (i.e. Mandatory Disclosure Rules) and OECD Model Disclosure rules to address Common Reporting Standard (CRS) Avoidance Arrangements and Opaque Offshore Structures which was released on 8th March 2018. So far, the exchange of information is done between Governments. The new guideline would require intermediary of an arrangement to disclose factual disclosure of the arrangement including service providers and to identify the jurisdiction in which the Arrangement is available to implement. It also includes intermediaries providing services for such an arrangement if they are in a position to know that such arrangements avoid reporting. The model rules would require intermediary to make the disclosure 30 days after the intermediary makes the arrangement available to implement or after the intermediary provides what are “Relevant Services”.

The Speaker also explained that now the game is over for CRS avoidance. The objective of Mandatory disclosure rule is to provide tax administrators with information on CRS Avoidance Arrangements and Opaque structures. This information is used by the jurisdiction for compliance purpose as well as to decide future policy tax design. Intermediary or user of a CRS avoidance arrangement or Opaque Offshore structure has to disclose certain information to its tax administration. If the user is resident of another jurisdiction, then information will be shared with that jurisdiction.
By rules, the tax administrators will get information about various schemes- their suppliers, users for use in compliance activities, exchange with treaty partners to tax policy design. Five key elements of rules are:

  • Description of arrangements that are required to be disclosed (i.e. Hallmark of Disclosable scheme)
  • Who will disclose – Description of persons required to disclose such arrangements (i.e. intermediaries that are subject to reporting obligations under the rules)
  • What to disclose: A trigger for the imposition of a disclosure obligation (i.e. when an obligation to disclose crystallises under the rules and any exception from reporting)
  • A description of what information is required to be reported
  • Appropriate penalties or other mechanisms to address non-compliance.

Considering the above rules the members also deliberated as to how will it affect the advice rendered by Chartered Accountants and other tax advisors.

The speaker further shared her knowledge and experience on various related issues which was a valuable takeaway for the participants.

Lecture Meeting on “Taxation of Transactions in Securities” held on 11th July, 2018

Taxation Committee of BCAS organised a lecture meeting on Taxation of Transactions in Securities on 11th July, 2018 at Indian Merchant Chambers, Mumbai which was addressed by CA. Yogesh Thar.

CA. Sunil Gabhawalla, President, BCAS introduced the Speaker and gave opening remarks while explaining about BCAS activities and also touched upon the subject in brief. At this occasion, BCAS publication “Interest Limitation Provisions under Section 94B” was also released by the hands of the guest Speaker.

CA. Yogesh Thar broadly covered the following key elements of Taxation of Transactions in Securities in detail:

1. Business Income vs. Capital Gains: Under this. he talked about relevant judicial pronouncements and legislations covering past assessment records, methods of valuation, nature and quantities of purchase and sales, ratio between purchase and sale and period of holding, frequency, continuity and regularity of transactions, source of acquisition, transfer of control and management along with shares, bonus stripping, amendments to Sec. 145 A etc.

2. Impact of Taxation of Transactions in Securities other than shares: He discussed about investment in units of equity mutual funds, purpose of MAT, one time settlement agreement, Accounting Policies and Changes, Demergers and Debentures etc.

3. Re-introduction of Long Term Capital Gains Tax: Under this topic, he explained about provisions prior to introduction of section 112A, its applicability from AY 2019-20 and analysis. He also talked about determination of cost of acquisition under section 55 (2)(ac) etc.

4. Section 50CA & section 56(2) & Valuation Rules: Under this segment, the Speaker explained about interplay between section 50 CA and 56 (2)(x). Section 50CA presupposes consideration, Rights and Bonus Issue, Convertible Instruments under section 56 (2)(x) etc. He also touched upon multi-layer shareholdings and the rules and issues on rules and other issues etc.

5. Taxability of ESOPS: Under this aspect, CA. Yogesh Thar deliberated upon the grant, vesting and exercise of options, sale of shares, recent development in taxability of stock option rights (SARS), issues under DTAA, Deductibility of ESOP Expenses and IndAS MAT implications amongst others.

6. GAAR Applicability to Transactions in Securities in particular for FPIs: The Speaker also talked about the circular no 7 of 27.01.2017 by CBDT, Draft Guidelines for GAAR implementation under Direct Tax Code Bill 2010 and analysis thereof.

7. Penny Stocks: He further shared his thoughts on taxability under section 115BBE, Safeguards against Transactions being treated as fictitious, documents required to prove genuineness and judicial analysis etc.

8. Transfer Pricing: Under this subject, the Speaker explained inbound and Outbound Investments and whether transfer pricing provisions would apply for buy back taxable under section 115 –QA.

Apart from the above, Mr. Thar also briefly touched upon Implications of long term capital gains tax on securities, Source of acquisition, Investment Portfolio, Listed and unlisted securities and transfer of unlisted shares, Debentures, Investment in Mutual Fund Units, Units of MF held as stock in trade, Valuation of cost to market value, Value of inventory as per RBI Guidelines and measurement of financial assets etc.

The Speaker also briefed about the case laws and circulars issued relevant to transactions in securities. He further spoke on introduction and purpose of MAT and unrealised and notional gains.

The lecture was followed by Q&A session and the Speaker replied to all the queries of the participants in a very
lucid manner.

ITF STUDY CIRCLE

ITF Study Circle Meeting on “Discussion on MasterCard AAR Ruling / Recent rulings on Permanent Establishment (‘PE’)” held on 12th July 2018 at BCAS Conference Hall

International Taxation Committee conducted a meeting on “Discussion on MasterCard AAR Ruling / Recent Rulings on Permanent Establishment” on 12th July, 2018 at BCAS Conference Hall. Meeting started with deliberation on facts of the case along with modus-operandi of the payment solution provider “MasterCard” by the Group Member and presenter CA. Nilesh Lilani.

After the brief explanation of the facts, the floor was opened for the members to discuss peculiar aspects from the perspective of different forms of Permanent Establishment (‘PE’). Revenue’s acknowledged the significant activities of the MasterCard in eccentric way which bring solace for the participants to discuss all the sweeping remarks made by AAR in relation to PE, Royalty and Fee for Technical Service and withholding obligations.

During the meeting, participants exuberantly discussed the significance of MasterCard Interface Processor (‘MIP’), MasterCard Network, Indian Subsidiary in determining the fixed place PE, rendering of services by employees in determining service PE and agency activities by Indian Subsidiary in determining dependent agent PE.

Further discussion took place amid consideration of implication with respect to restructuring in MasterCard India, Transfer Pricing Report of Indian Subsidiary, reply under section 133(6) of the Income Tax Act, 1961 by Banks in India, mark-up charged on technology upgradation services of MIP, taxation of MasterCard in other jurisdiction such as Australia, preparatory and auxiliary nature of services and other related considerations.

Indeed, it was bolstering and interactive meeting and the participants got enormously benefitted from the discussion and insights provided during the meeting.

Meeting on “Making Internal Audit Count: Raising to the Expectations – A Curtain Raiser” held on 13th July at BCAS Conference Hall

Internal Audit has long been acknowledged as one of the four pillars of Corporate Governance. Is the pillar of Internal Audit strong enough to support Corporate Governance? To discuss the issue at length, the newly formed GRC Subgroup of the Accounting and Auditing Committee hosted an interesting “curtain-raiser” event titled “Making Internal Audit Count – Rising to the Expectations” at the BCAS Conference Hall on 13th July, 2018. This event marked the beginning of the year long series of events and initiatives planned by this subgroup to create a platform for GRC professionals to interact and ideate, teach and learn. The Annual Calendar of events planned was also released at this event.

The speakers for the evening, CA. T. N. Manoharan and CA. Mario Nazareth, enthralled the audience with their intellect, humour and wisdom – a rare combination indeed. Their years of experience in senior management and leadership positions translated into deep insights. The carefully curated presentations added colour and charm to the evening; their emphasis on professional responsibility, ethics and integrity, and the need to make a positive contribution raised the bar for the audience by several notches. The large turnout at the event, from industry and profession resulted into a packed hall and an overflow in the foyer where there was live display on the screen.

With the success of this launch event, the GRC subgroup of the Accounting & Auditing Committee is confident of moving forward with the series of initiatives planned for the year with focus on Internal Audit.

The sessions were very interactive and enlightening for the participants who benefitted a lot from the rich experience of the learned speakers.

“Panel Discussion on “Analysis of PE Constitution- “Recent Judicial Pronouncements including MasterCard, Nokia Networks and Formula One.” held on 14th July, 2018 at BCAS Conference Hall

The international taxation committee held a half-day panel discussion on 14th July 2018 at BCAS Conference Hall, on the contentious topic of Permanent Establishment with special reference to the recent Advance Ruling in the case of MasterCard, the Supreme Court decision in Formula One case and Tribunal’s Special Bench ruling with regard to Nokia Networks OY.

The Panel consisted of three eminent personalities in the field of international taxation namely Mr. Kamlesh Varshney, Commissioner of Income-tax; Mr. Uday Ved, Partner, KNAV and Mr. Rishi Kapadia, partner, Dhruva Advisors. The panel was moderated by Mr. Akshay Kenkre, Founder, TransPrice Tax Advisors LLP.

The decision of Advance Ruling Authorities (AAR) for the MasterCard Singapore was the highlight of the day. Mr. Kamlesh Varshney gave a detailed understanding of the fact pattern of the decision. It was deliberated that the essential element to hold MasterCard Singapore as having a Permanent Establishment in India was the location of the MasterCard Interface Processor (MIP) that connects the MasterCard’s network and processing centres.

Although the Indian subsidiary owned the MIP, the control over the asset exercised by MasterCard Singapore and it is not the ownership but the control over the risk and the asset that are essential elements for the creation of a Permanent Establishment. Here the test of disposal was one of the debated topics amidst the panel.

Further, the importance of Functional, Asset and Risk (FAR) Analysis was brought out during the discussion. The importance of FAR in the transfer pricing study is well known, however, it was brought to attention that such a FAR shows the true substance of a transaction and therefore, could also be relied upon by the international tax authorities to arrive at a conclusion to address a question on the permanent establishment.

The next in line was the Formula One decision by the Supreme Court. The decision gives an interpretation of the test of permanence for determination of Permanent Establishment. The panel considered the pros and cons of the determination of duration test of as short as 3 days to be considered as a Permanent Establishment. If the economic activity is conducted over the entire period of the tournament, then the test of duration is considered to be met. Also, the intention to conduct such activities on a year on year basis is an important proof to hold such transaction to lead to a Permanent Establishment.
The last discussion was on Nokia Networks OY, where it was held that Nokia Networks OY does not create a Permanent Establishment in India. This was a contradictory decision to the earlier two decisions discussed and thus was deliberated on factual grounds.

It was discussed that the activities of the Indian subsidiary cannot be reckoned to constitute a fixed place Permanent Establishment as it did not fulfil any of the triple tests of a fixed place, permanency and disposal, which are prerequisites to constitute an entity as a Permanent Establishment.

The panel gave an all-around perspective in all the three judgements and provided insights taking various live cases and examples to substantiate the explanation which was a huge takeaway for the participants.

INDIRECT TAX STUDY CIRCLE

Meeting on “Supply and Definition of Business under GST” held on 24th July, 2018 at BCAS Conference Hall

Indirect Taxation Committee organised a study circle on ‘Supply and Definition of Business under GST’ on 24th July, 2018 at BCAS Conference Hall which was addressed by the Group Leader CA. Rahul Thakar under the mentorship of CA. Vikram Mehta and CA. Jayraj Sheth. The Speaker made an in depth analysis of both the definitions and cited various past case laws relevant to the terms used in the definitions. Both the mentors guided well not only the leader but also ensured that the overall discussion and coverage completed well in time. Meeting was very interactive and participants immensely benefitted from the session.

Society News – II

GST Seminar at Ahmedabad
jointly with CA  Association of Ahmedabad
held on 23, June, 2017

BCAS held a one day seminar on GST jointly with Chartered
Accountants’ Association of Ahmedabad (CAA). The object of the conference was
to disseminate the views of eminent faculties who have carried out in depth
study of newly enacted law of GST together with their vide experience in
profession. CA Puloma Dalal, CA Chirag Mehta and CA Dushyant Bhatt, faculties
from our Society spoke on various areas of GST at length at the full day
seminar. The seminar was attended by 85 participants.  

CA. Puloma Dalal

CA. Chirag Mehta

CA. Dhushyant Bhatt
In the first session CA
Puloma Dalal gave the participants an overview of GST law including the concept
of Supply under GST and provisions relating to liability to pay Tax and Time
and Value of Supply

CA Chirag Mehta gave a
detailed presentation on provisions relating to return filing and took the
participants through the process of filing of returns. He also discussed the
statutory provisions relating to Input Tax Credit under the GST Law and the
concept of matching of ITC under the GST Law

CA Dushyant Bhatt
discussed the provisions relating to job work and dealt with various issues to
be addressed by the entity carrying out job work as well as by the entity
sending material for job work, payment of tax, TDS and E-Commerce provisions
including TCS.

A one and half hour long
interactive panel discussion was held where various questions of the
participants were taken up by the three speakers. Participants benefitted a lot
from the meeting.

GST Workshop with IMA Indore held on 24th June,
2017 at Indore

BCAS jointly with Indore Management Association (IMA)
organized Exclusive Workshop on Saturday, June 24, 2017 at Brilliant Convention
Centre, Indore titled “Fasten Your Seat Belt-GST ready for take off”.

Faculty for this workshop
representing BCAS comprised of CA. Rajat Talati, and CA. Deepak Thakkar. CA.
Santosh Muchhal, President, IMA welcomed the delegates and thanked BCAS for
this workshop. President (Elect) of BCAS CA. Narayan Pasari in his welcome
speech introduced BCAS to the gathering. He also mentioned that GST is a
win-win reform for everyone and will have lasting benefits for businessmen,
Government, consumers and professionals.

CA Rajat Talati started the first session by stating that GST
is an Integrated Tax Regime which will reduce Policy Paralysis in Indian
Economy. It will also avoid Double Taxation problem which of late is posed as a
major threat for the Indian Economy.

CA. Talati explained that
Goods and Service Tax (GST) is a destination based tax on consumption of goods
and services. It is proposed to be levied at all stages right from manufacture
up to final consumption with credit of taxes paid at previous stages available
as setoff. In a nutshell, only value addition will be taxed and applicable tax
is to be borne by the final consumer.

CA Deepak Thakkar took the
2nd Session and explained that Goods and Services Tax (GST) will be
levied at multiple rates ranging from 0 per cent to 28 per cent. GST Council
finalized a four-tier GST tax structure of 5%, 12%, 18% and 28%, with Zero to
lower rates for essential items and the highest for luxury and de-merit goods
that would also attract an additional cess. Goods and Service Tax on services
will go up from 15% to 18%. The services being taxed at lower rates, owing to
the provision of abatement, some services such as train tickets etc will fall
in the lower slabs.

It would be a dual GST with the Centre and States
simultaneously levying it on a common tax base. The GST to be levied by the
Centre on intra-State supply of goods and / or services would be called the
Central GST (CGST) and that to be levied by the States would be called the
State GST (SGST). Similarly Integrated GST (IGST) will be levied and
administered by Centre on every inter-state supply of goods and services. The
GST will be shared by the Centre and the respective State equally.

CA. Rajat Talati

CA. Deepak Thakker

He also mentioned that
there are many benefits available to small tax payers under the GST regime. The
two speakers answered the many questions raised by the participants at the end
of their sessions.

The joint workshop was a very enriching experience for the
140 participants.

Two days seminar on GST
for Trade, Industry and Professionals held on 24th& 25th
June 2017 at Ghatkopar

This two day seminar was held at
Zaverben Auditorium, Ghatkopar where 725 participants attended comprising of
chartered accountants and members of trade and industry.


CA. Sunil Gabhawalla


CA.Mandar Telang

 

CA. Shreyas Sangoi

 

CA. Ashit Shah
The Seminar covered almost
all aspects of Final GST law comprising of Integrated Goods and Service Tax
Act, Central Goods and Service Tax Act and State Goods and Service Tax Act
along with the rules enacted by the Government. The eminent Speakers explained
the salient features of the law including the concept of supply, classification
of goods and services, time and place thereof, value of supply, charging
provision, threshold exemption, transition provisions, composition scheme,
registration, maintenance of records, tax invoice, payment of GST including
under reverse charge, returns and other compliances, input tax credit including
Input Service Distribution Mechanism, export and import of goods and services
including SEZ, job work under GST, etc. The learned Speakers from BCAS included
CAs Sunil Gabhawalla, Samir Kapadia, Rajkamal Shah, Naresh Sheth, Jayesh Gogri,
Mandar Telang, Ashit Shah and Shreyas Sangoi. Advocate Shailesh Sheth also gave
his valuable inputs on GST at the Seminar. At the end of the seminar, there was
specific industry wise panel discussion covering, textile and garment
manufacturers, gem and jewellery, stock brokers, mutual fund and insurance
agents, transport and logistics, C & F agents, tour operators and travel
agents, builders & developers, works contractor, co-operative housing
societies, caterers, hotels & restaurants, SMEs, retailers, traders and
small scale manufacturers, leasing and right to use goods, job worker and
service providers. The overview of the new indirect tax law replacing plethora
of numerous laws and detailed discussion on each subject and dissemination of
latest knowledge alongwith industry specific panel discussion generated lot of
interest amongst the participants making the seminar interactive to a large
extent. All participants were fully enriched by the deliberations at the
Seminar.

CA. Naresh Sheth

CA. Rajkamal Shah

CA. Samir Kapadia

Lecture Meeting on GST
& CAs – Impact on Compliance & Practice held on 27th June,
2017

Indirect Taxation
Committee of BCAS organised a lecture meeting on “GST & CAs – Impact on
Compliance & Practice” on 27th June, 2017 at K. C. College Auditorium,
Churchgate which was addressed by CA. Sunil Gabhawalla.


CA. Sunil Gabhawalla

With GST becoming a reality,
there were many issues which were faced by the practising chartered accountants
like the impact on billing under the Service Tax law and receipt under the GST
regime, paying tax on procurements from unregistered vendors, concept of supply
and place of supply with respect to clients being located in other states, a
multi-locational firm etc. CA, Gabhawalla explained about the new GST Law, its
challenges and compliances and how it is going to impact practicing Chartered
Accountants. He also enlightened on the Composition Tax and monthly return
filing process under GST. 

The speaker explained in detail and in candid way the
challenges that a practising chartered accountant would face, He also answered
a few queries raised by the members.

The participants benefitted a lot from the meeting.

‘New Curriculum of CA
Course – Has the bar been raised? organised on 5th July, 2017 at
BCAS.

HDTI Committee had organised a talk on ‘New Curriculum of CA
Course – Has the bar been raised?’ by Member of Central Council of ICAI, CA
Nihar Jambusaria.

The talk was organised for students who are eligible to
appear for CA exams under new syllabus and having their doubts regarding the
same.

CA Nihar Jambusaria meticulously explained each and every
aspect of the new curriculum and also provided a comparative analysis between
the old and new curriculum. The talk was followed by an extensive ‘Q&A’
session wherein students sought clarifications for their doubts and the speaker
positively answered all their queries.

The talk received overwhelming response from the student
fraternity. Further, quite a lot of students also took the benefit of live
streaming of the seminar at their respective places or CA firms.

The talk provided valuable
guidance to all students and was widely appreciated. 

Study Circle Meeting on
Technology Trends: Impacts of Artificial intelligence, Machine learning,
Drones, Big Data held on 5th July, 2017 at BCAS Conference Hall.

At this study circle meeting, Mr. Nikunj Sanghvi, a Mobile /
Digital Professional from USA, shared his insights on the upcoming technology
trends and their probable impact on businesses going forward. He started by
explaining the trend of expectations towards new technologies – how they
initially reach a peak followed on by disillusionment as the technologies are
not as good as expected and later on get slowly accepted by public at large. He
covered many different innovations including drones, augmented reality, digital
twins, big data, artificial intelligence & machine learning, intelligent
apps, autonomous vehicles, speech recognition and voice interfaces, block chain
and crypto currencies.

Mr Sanghvi also explained these innovations and their impact
which are already seen in some business areas. For example, using drones,
auditors are doing a physical check of goods in large warehouses in a day which
otherwise would take them weeks! On giving such other examples, the immediate
query from the group was what will happen to many existing jobs. Mr Nikunj
mentioned that while there may be jobs which are lost as and when these
technologies become mainstream, he was positive that there will be many newer
jobs which people will be able to fill in. His point was that Man’s wants are
unlimited and even if a few wants are met by these new technologies, there will
be many more which will remain unfulfilled. Therefore, there may be no need to
worry unnecessarily for job losses.

The meeting ended on this positive note and participants
benefitted a lot.

69th
Foundation Day Lecture Meeting on “ENERGising India-Changing Paradigm for
Professionals” held on 6th July, 2017 at Garware Club House,
Churchgate, Mumbai

A lecture meeting on “ENERGising India-Changing Paradigm for
Professionals” was held on 6th July, 2017 on the occasion of 69th
Foundation Day of the Society which was addressed by our Hon’ble Union Minister
of State (IC) for Power & Renewable Energy CA. Piyush Goyal.  President CA. Chetan Shah briefly touched
upon the GST regime and also shared the profile of Mr Goyal while welcoming the
Chief Guest and then requested him to address the august audience.

CA. Piyush Goyal – Minister
of State for Power, Coal, New
and Renewable Energy and
Mines (Independent charge)

Mr Goyal started his oration with the past memories of his
BCAS membership and appreciated the caricature of the cover design of GST issue
of July Journal stating that the cover design is very well presented. He then
talked about the GST Bill and explained how GST Council has been empowered to
function without any interference from the Government. Mr Goyal also emphasized
that GST is a great testimony with the culmination of 17 taxes into one tax
“GST” where the Traders, Businessmen, Manufacturers and others will get the
Input Tax Credit when goods move from one place to another. This transformation
would help to curb inflation, bring transparency, eradicate the atmosphere of
uncertainties and corruption, eliminate black money etc. This revolutionary
step has been taken by the Government in the national as well as public
interest without any political opportunism. 

 

BCA Journal – GST Special Issue Release
L to R : CA. Sunil Gabhawalla, CA. Narayan Pasari, Shri Piyush Goyal (Speaker), CA.
Chetan Shah (President), CA. Manish Sampat, CA. Suhas Paranjpe, CA.Abhay Mehta.

On the topic of the Lecture Meeting “ENERGising
India-Changing Paradigm for Professionals”, he cited Mahatma Gandhi Quote
that we are the trustees of the Planet and it is our collective responsibility
to keep the environment clean, abolish pollution and adapt to healthy and
hygienic climate changes for better quality of life for 1.25 billion Indians.
Our inhabitants especially in the rural areas cannot afford to live without
electricity, shelter, transportation, medical facilities etc and Government has
taken strong steps to provide these amenities to majority of the villages and
would reach the zero defect in a phased manner. Mr Goyal also informed the
gathering that at present, India is energy surplus and self-sufficient in Power
Distribution. As per the world standards, we are contributing to clean energy
and reducing pollution levels. He also urged upon the citizens to use LED bulbs
to conserve the energy and contribute in Nation Building. Besides, Mr Goyal
also remembered our armed forces and assured to provide them with the most
modern equipment and technology to fight any internal and/or external threat.

 

Audit Checklist Publication Release
L to R : CA. Raman Jokhakar, CA. Sunil Gabhawalla, CA. Narayan Pasari, Shri
Piyush Goyal (Speaker), CA Chetan Shah (President), CA. Manish Sampat, CA.
Suhas Paranjpe, CA Abhay Mehta

He thereafter appealed to the Chartered Accountants
Fraternity to strengthen and upgrade the audit standards to curb the Tax
evasion/avoidance and further transform the future of India, because CAs are
the force to reckon with in the professional industry.

At the end, he expressed confidence that Chartered
Accountants can do a lot for the public good and make India again.

The audience got mesmerized with Mr Goyal’s presentation
skills and gained a lot from the insights straight from the heart and from his
spellbinding Speech.

Lecture Meeting on “Recent Developments in Taxation of
Capital Gains” held on 11th July, 2017.

Taxation Committee of BCAS organized a Lecture Meeting on
Recent Developments in Taxation of Capital Gains on 11th July, 2017
at IMC, Churchgate, Mumbai. The first meeting of the year at BCAS which
commences from the Founding Day, 6th July, was addressed by CA.
Pinakin Desai wherein he explained about the Notional Taxation w. r. t. Fair
Market Value (FMV) of unlisted equity shares under Sec 50CA, shift of base year
for indexation from 1981 to 2001 to compute the cost of bonus shares and
amendment to Sec 10 (38) with background and notification on 3rd proviso
to Sec 10(38). He also discussed about the Protocol to India – Mauritius Treaty
with emphasis on Mauritius and Multilateral Treaty (MLI) and protocol amending
India-Singapore Treaty. CA. Pinakin Desai further explained about the valuation
of shares under Normative Valuation with draft valuation rule notified u/s. 50
CA and issues under normative valuation. He also deliberated on Sec 195 –
withholding actual or notional consideration for Sec 50 CA. 



CA. Pinakin Desai

Mr Desai also explained the
above topics with case studies on (i) resolving normative valuation of shares
as per draft notification, (ii) valuation of unquoted equity shares, (iii)
acquisition in IPO, (iv) acquisition pursuant to merger, (v) gift of shares,
(vi) Inter-se promoter transfer, (vii) direct transfer vs. indirect transfer,
(viii) impact of dividend distribution and (ix) case study under
India-Mauritius Treaty.

The hall was packed with
the audience and it was a very fulfilling and enriching experience for the
participants to benefit immensely from the meeting.

GST Training Seminar Jointly with NACIN held from 13th
July to 15th July, 2017 at BCAS Hall

With the roll out of GST on
1st July, 2017, the 3rd batch of GST Training Seminar for
Trade, Industry & Profession was organised by Indirect Taxation Committee
of BCAS jointly with the National Academy of Customs, Indirect Tax and
Narcotics (NACIN), to make understand the intricacies and the importance of GST
laws & provisions.

CA. Mandar Telang

CA. Shreyas Sangoi

 

CA. Chirag Mehta

CA. Govind Goyal

The purpose of holding such training workshop
was dual – one to educate the trade and industry about the new legislation and
more importantly, partnering Government in disseminating information about this
landmark “One Nation One Tax”.

 The speakers at the Seminar were BCAS members
accredited by the NACIN as GST Trainers, and a few officials from the GST
department. The faculty from BCAS included CAs Chirag Mehta, Dushyant Bhatt,
Govind Goyal, Mandar Telang, Naresh Sheth, Rajkamal Shah, Shreyas Sangoi and Ms
Vishaka Borse, & Mr, Shrikant Shaligram from the GST Department.

CA. Naresh Sheth

CA. Dushyant Bhatt

 

CA. Shrikant Shaligram


CA. Rajkamal Shah

The participants immensely benefited from the training
programme.

Dharampur Noble Social Cause Visit – on 15th &
16th July, 2017

The visit to Dharampur was
organised for two days by the Human Development and Technology Initiative


Dharampur Noble Social Cause Visit

Committee of BCAS jointly
with BCAS Foundation, for Tree Plantation, Eye Camp project and visit to
various NGOs, at Dharampur. These NGOs are engaged in the various social
welfare activities for Holistic growth of Tribals located in the remote
interiors. A Team of 24 enthusiastic volunteers including students who were
willing to take active participation in this noble mission joined the trip.

Sarvoday Parivar Trust (SPT)

The SPT is a NGO, following
Gandhian philosophy and engaged in various tribal welfare activities in the
field of Education / Health / Agriculture / Water management / Environment,
etc. The BCAS Foundation committed for plantation of 3,000 trees to SPT. The
team also visited the Residential School run by the SPT which is home to more
than 350 children from nearby villages.. This residential school has encouraged
poor labourers and farmers in the tribal areas to send their children for
further studies. It has helped in reducing child labour, child marriage and
other social evils which takes place mainly due to illiteracy and poverty.
Members had good interactions and time with them. The School premises are old
and needs to be renovated and upgraded to provide better amenities to children.
BCAS Foundation has committed its full support for the redevelopment and
upgradation of school/ hostel.

Avalkhandi Kelavani Trust (AKT)

The AKT is an NGO which
carries out various activities in Education & Water Management in the
villages of the most backward forest of Dharampur, running a government School
where approximately 300 students are studying & has one Chhatralaya whereby
180 children are accommodated for stay from other villages who would have
otherwise been deprived of education. The BCAS Foundation committed for
plantation of 2,500 trees to AKT. On behalf of BCAS Foundation, team
distributed kits for outdoor games like cricket / Football/ Badminton  / Flying Dish etc  and many educational games at AKT for their
children. The BCAS Foundation contributed Rs. 30,000/- for setting up a library
in the Chhatralaya.

The team viewed the various
check dams created on mountains in the process of water management.

Dhanvantri Trust (DT)

The trust is founded and
managed by Dr. Kirtikumar Vaidya, from Mumbai who left Mumbai at a young age
& has dedicated his life for socio economic rural development of tribal
villages of South Gujarat. With divine blessings he started an Eye Hospital in
Vansda. Our team member had contributed Rs. 63 lakh for setting up Hospital
with latest Equipment & Technology for treating and curing all types of Eye
Surgeries.

BCAS Foundation sponsored 201 Eye Surgeries for poor Tribals & has
dedicated support for 50 more, thanks to contribution & support of Esteemed
Donors, amounting to Rs.2.01 lakh.

Dr. Vaidya proposed to set up a school in Vansda. BCAS Foundation has
committed their support for the same.

The   trip for Tree plantation
drive and the Eye Camp was truly enriching, enlightening and educational too
for the visiting members and students. The memories treasured from the trip,
would always encourage and motivate them to participate more in such events
which would be beneficial to the society at large.

Direct Tax Study Circle Meeting on ‘Income Computation
Disclosure Standards; ICDS V Tangible Fixed Assets, ICDS IX Borrowing Costs
& ICDS X Provisions, Contingent Liabilities & Contingent Assets’ on 15th
July 2017

The Chairman of the
Meeting, CA. Anil Sathe gave his opening remarks and raised some issues
relating to ICDS which could face litigation in the long run. The Group leader,
CA. Dhaval Desai drew attention to an extract from the Supreme Court decision
in Woodward Governor 312 ITR 254 wherein the Hon’ble Supreme Court observed
that for income tax purposes, profits are to be computed in accordance with the
ordinary principles of commercial accounting unless, such principles stand
superseded or modified by legislative enactments and this is where section
145(2) comes into play.

Thereafter, the group
leader briefly explained the provisions of ICDS IX ‘Borrowing Cost’-
recognition principle, definitions of borrowing cost and qualifying assets. He
explained the provisions of capitalisation in respect of specific borrowings
and general borrowings and the provisions relating to commencement and
cessation of the capitalisation. He mentioned that as per Accounting Standard
16, an asset qualifies to be a Qualifying Asset only if it takes substantial
period of time to get ready for its intended use or sale, however ICDS has done
away with the criteria of ‘substantial period of time’ (except for inventories)
and this would lead to a huge difference between the capitalisation of
borrowing costs as per books and capitalisation as per ICDS.

The group leader further
touched upon the provisions of ICDS X ‘Provisions, Contingent Liabilities and
Contingent Assets’. He mentioned the yardstick for recognition of a provision
‘probable’ as per Accounting Standard 29 has become stricter under ICDS wherein
the term ‘probable’ has been substituted with ‘reasonably certain’. Similarly,
in case of contingent assets, the term ‘virtual certainty’ used for recognition
as per AS 29 has been substituted with ‘reasonably certain’ under ICDS. He
commented that such provisions would certainly lead to preponement of income
and postponement of deduction of expenses. The group leader touched upon
transitional provisions contained in ICDS X.

Subsequently, CA. Dhaval
briefly explained the provisions of ICDS V ‘Tangible Fixed Assets’. He
highlighted one of the differences between existing AS and ICDS with regard to
treatment of expenditure between trial run and commercial production. In this
context, Revised AS 10 mandates such expenditure to be revenue in nature
whereas CBDT clarification on ICDS states that such expenditure should be
treated as capital expenditure.

The participants benefitted a lot from the
meeting.

Society News -I

Full day seminar on
“Income Computation and Disclosure Standards” held on 19th May, 2017

This seminar was held by
the Taxation Committee at Navinbhai Thakkar Hall at Vileparle (East). President
Chetan Shah gave the opening remarks followed by introduction from the Chairman
of the Taxation Committee, Mr. Ameet Patel. The event was attended by 235
participants. Topics taken up and Speakers were as under:

–    Overview of ICDS:- Mr. Pawan Kumar, CIT
(Jalandar)

–    ICDS III & VIII:- Constructions
Contracts & Government Grants :  CA.
Paresh Vakharia

–    ICDS I & ICDS X:- Accounting Policies
& Provisions, Contingent Liabilities & Contingent Assets: CA. Vishesh
Sangoi

–    ICDS IV & IX:- Revenue Recognition &
Borrowing Costs: CA. Vinita Krishnan

–    ICDS VI & VIII:- Foreign Exchange
Fluctuations & Securities: CA. Kushal Jain

–  ICDS II & V:- Valuation of Inventories
& Tangible Fixed Assets: CA. Nihar Jambusaria

Mr. Pawan Kumar, CA.
Vishesh Sangoi and CA. Kushal Jain spoke on the BCAS platform for the very
first time. 

Mr. Pawan Kumar gave an
overview of the ICDS. He also shared with the participants on why ICDS were
needed and how it came into existence. He being one of the members of Expert
Committee for drafting of ICDS shared his experiences with the participants
which was appreciated by all.

CA. Paresh Vakharia gave
his opening remarks on ICDS and explained the purpose of the said legislation.
He dealt with both the ICDS allotted to him in detail and explained nuances and
issues arising from them.

CA. Vishesh Sangoi started
his presentation by explaining the basic issues arising from ICDS I and X. He
explained various changes which would take place while undertaking Tax Audit in
post ICDS scenario compared to earlier ones with the help of various case
studies. He also touched upon disclosure requirements in Form 3CD for both
ICDS. He also responded to queries from various participants.

CA. Vinita Krishnan gave a
detailed presentation on ICDS IV & IX. She explained the basic
considerations arising out of them and also discussed the issues which one may
face while applying them. She discussed ICDS on revenue recognition with
respect to different type of incomes like dividend, royalties, interest etc.
She also answered queries from the participants.

CA. Kushal Jain explained
ICDS on securities with the help of case studies and also examples on how it
would be applied. He also explained various terms which are used in both the
ICDS. He also dealt with how the accounting entries would be affected in case
of ICDS on foreign exchange fluctuations.

CA. Nihar Jambusaria
explained the background and general principles of ICDS. He highlighted the
journey of evolution of ICDS. He also brought out the differences which will be
encountered between Ind AS and ICDS. He compared ICDS of Valuation of
Inventories with AS 2 and brought the changes between them. He also compared AS
10 with ICDS on Tangible Fixed Assets and explained the treatment under ICDS V.
He enlightened the participants with the disclosure requirements under both
ICDS and also addressed various questions from the participants. 

The sessions in the Seminar
were interactive and the speakers shared their insights on the subject and
guided the participants on how to approach the subject of ICDS while performing
a Tax Audit. The participants benefited immensely with the interactive sessions
and detailed analysis of each ICDS by the faculties.

Full day seminar on
“Practical issues in TDS” held on 20th May, 2017 at BCAS

The Full day seminar on
Practical issues in TDS was held by the Taxation Committee at BCAS Conference
Hall on 20th May, 2017. The event was attended by over 80 participants.
President Chetan Shah gave the opening remarks followed by introductory words
from the Chairman of the Taxation Committee, Mr. Ameet Patel.

Various topics were taken
up at the Seminar by the following Speakers:

–    Sections 194C, 194DA, 194EE, 194F and 194J :
CA. Saroj Maniar

–    Sections 195, 206AA, Rules 37BB and 37C :
CA. Ritu Shaktawat

–    Sections 192, 194H, 194LB, 194LBA, 194LBB,
194LBC : CA. Anita Basrur

–    Sections 194A, 194I, 194IA, 194IB, 194IC and
recent case laws on TDS : CA. Nitin Shingala

–    Issues in e-filing of TDS statements,
Sections 200A, 201 and 205 : CA. Avinash Rawani

CA. Ritu Shaktawat and CA.
Anita Basrur spoke on the BCAS platform for the first time.

CA. Saroj Maniar gave an overview of the various sections,
the case laws and circulars applicable and relevant in their context. The
speaker elaborated on the provisions of Sections 194C and 194J and covered some
industry specific issues as well as the interplay of these sections with other
sections of the Act.

CA. Ritu Shaktawat
explained the applicability of section 195. She highlighted the risk arising
out of non-compliance of applicable sections as well and provided insight on
issues surrounding Forms 15CA and 15CB. She also touched upon issues under
Section 206AA, Rules 37BB and 37C. The Speaker elaborated on contractual
remedies that one could pay attention to and should incorporate in the
agreements such as indemnity, representations and warranties, escrow,
insurance. She also explained the provisions and their application through case
studies.

CA. Anita Basrur started
her presentation by explaining the provisions of section 192 and 194H,
practical issues arising thereunder using relevant case laws and recent
circulars. This was followed by in depth discussion on sections governing TDS
on income received by securitisation trusts, business trusts and units of
Investment Funds.

CA. Nitin Shingala gave a
detailed presentation on various aspects governing sections 194A, 194I, 194IA,
194IB and 194IC. He explained the applicable provisions, issues under each of
them, supporting them by relevant case laws and circulars.  The Speaker touched upon a wide number of
judgments during the course of his talk on various sections pertaining to
deduction of tax at source.

CA. Avinash Rawani highlighted
the practical issues that arise in e-filing of various TDS statements such as
returns, correction statements, challan corrections, replies to be filed to
online communication from the TDSCPC amongst others. In addition to
highlighting the issues, the Speaker shared a lot of practical dos and don’ts
in relation to the filing of these statements.

 

CA. Saroj Maniar

 

CA. Ritu Shaktawat

 

CA. Anita Basrur

 

CA. Nitin Shingala

 

CA. Avinash Rawani

The sessions in the Seminar
were very interactive and the Speakers answered a lot of queries that were
received from the participants. The participants benefited immensely with the
interactive sessions and detailed discussions.

Half
day seminar on “Digital Transformation and GST – Opportunities and Challenges
in ERP environment” on 26th May, 2017 at BCAS

A half day seminar on
Digital Transformation and GST was organised by Human Development &
Technology Initiative Committee jointly with Indirect Tax Committee at BCAS
Conference Hall on 26th May 2017. CA. Nikunj Shah, Convenor, HDTI
Committee introduced the speakers to the participants.

The speakers – Mr. Richard
D’Souza (Vice President & Head Business Solutions-Corporate IT Mahindra
& Mahindra Group ) & Mr. Rakesh Pawaskar (General Manager Business
Solutions – Corporate IT Mahindra & Mahindra Group) made an excellent presentation
on the Technology transformation undertaken by them in their organisation. They
also explained and demonstrated through audio visual presentation, the nuances
of GST implementation, the GST implementation process at their group and how
the said group is supporting their vendors for GST implementation using state
of the art technology platform.

The seminar witnessed
excellent participation from members in practice as well as from Industry. The
objective of the seminar was to understand the innovation in technology leading
to change in accountants role from pure accounting to analytics and decision
making & to highlight how GST implementation could be achieved leveraging
technology.

 

Mr. Richard D’Souza

 Mr. Rakesh Pawaskar

The participants were
immensely benefitted from the Seminar.

GST Training for Trade,
Industry & Profession held on 29th, 30th & 31st
May 2017 & 19th, 20th & 21st June
2017 at BCAS

The Government’s decision
to roll out the GST Law on 1st July, 2017 made it all the more
important that BCAS organise more programs so as to educate and train as many
people on the intricacies and the importance of these laws.

BCAS organised two such
programs one in May from 29th to 31st and the other in
June from 19th to 21st at BCAS Conference Hall. The
purpose of holding such training workshops was dual – one to educate the trade
and industry about the new legislation and other, more importantly, being a
partner of the Government in disseminating the information about this One
Nation One Tax One Market.

These programs were conducted jointly with the National
Academy of Customs, Indirect Taxes and Narcotics (NACIN) and the sessions were
taken by members of BCAS who were accredited by the NACIN as GST Trainers and a
few officials from the Sales Tax department and NACIN also. The faculty from
BCAS included CAs Chirag Mehta, Dushyant Bhatt, Govind Goyal, Jayesh Gogri,
Mandar Telang, Naresh Sheth, Rakjamal Shah, Samir Kapadia, Shreyas Sangoi and
Sunil Gabhawalla. 

CA. Rajkamal Shah

CA. Samir Kapadia

CA. Chirag Mehta

 

CA. Shreyas Sangoi

 

CA. Sunil
Gabhawalla

The participants immensely
benefited from both the programmes.

BEPS Study Circle Meeting
held at BCAS Conference Hall on 3rd June 2017

BEPS Action Plan 6 read
with Action Plan 15 (Multilateral Instrument i.e. ‘MLI’): Preventing the
Granting of Treaty Benefits in Inappropriate Circumstances was held on 3rd
June, 2017 at BCAS Conference Hall.

Discussion was led by CA. D
S Sharma, CA Monika Wadhani and CA. Rutvik Sanghvi

This was the third meeting
on Action Plan 6: The group leaders covered overview of Article 6 to 8 of the
MLI and detailed comparison of LOB clause.

In the meeting, the group
leaders had taken up detailed discussion on following Articles of MLI read with
Article X of Action Plan 6 and had concluded discussion with emphasis on the
following:

–  Article 8 of MLI  – Dividend transfer transaction intends
to introduce a minimum shareholding period of 365 days to be entitled to
beneficial rate of taxation on dividend.

–  Article 9 of MLI – Capital Gains from
alienation of shares or interests of entities deriving their value principally
from immovable property intends to give taxing rights to the Contracting State
where immovable property situated, if at any time during the 365 days preceding
the alienation of shares, such shares derived value principally from such
immovable property.

–  Article 7(1) of MLI – Principal Purpose
Test (‘PPT Clause’): It intends to introduce a minimum standard in form of PPT
clause to be adopted by the Contracting States. The group leaders discussed the
meaning and possible interpretations of various words contained in the PPT clause
(like meaning of “benefit”, “one of the principal purposes”, etc.) and
explained each and every example given in the commentary to Action plan 6. The
group leaders also highlighted the difference and the interplay between the
Indian GAAR provisions and the PPT clause. For example, under the Indian GAAR
provisions, requirement is “if main purpose is tax benefit”vis-à-vis the PPT
clause, requirement under the MLI being “one of the principal purposes is tax
benefit”, etc. It was also discussed that PPT clause will be relevant to
consider the applicability of a tax treaty and if PPT clause is invoked then
treaty benefits shall not be available and many transactions could get
impacted. It was also discussed whether GAAR provisions can be invoked where
transaction is covered by a tax treaty.

The meeting got
enthusiastic response and the participants benefitted a lot from the
discussions

10th Jal Erach
Dastur CA Students Annual Day held on 3rd June 2017

The Jal Erach Dastur CA
Students’ Annual Day this year reached a new scale as it celebrated its 10th
Edition captioned under tagline ‘Tarang 2K17 – Tarasho Apne Talent Ke Rang.’ at
Navinbhai Thakkar Auditorium, Vile Parle on 3rd June 2017.

 

Students lining up to witness the most
awaited event of the year

This event was organized by
the Human Development and Technology Initiatives Committee of the BCAS for the
CA students. The event was truly an event ‘OF CA students, FOR CA students and
BY CA students’. It showcased their mesmerizing talents and creativity on
variety of extra-curricular activities such as elocution, debate, sketch and
slogan, photography, short film making and other talents such as singing, music
etc.

Then Vice President CA. Narayan Pasari
felicitating the Chief Guest of Tarang –
Mr. Dhaval Bathia

President Chetan Shah, Vice President
Narayan Pasari along with members of
HDTI Committee witnessing the lighting
of auspicious lamp to commence the
event

The six finalists of the Chandanben Maganlal
Bhatt ‘Elocution Competition’ were the first to witness the stage. The topics
this time were both challenging as well as riveting. This enabled a level
playing field for all participants who gave their impressive performances on
their respective topics.

CA. Nitin Shingala & CA. Meena Shah
presenting the award to the winner of
Elocution Competition ‘Speak Up’ – Miral
Majmundar

Then BCAS President CA. Chetan Shah
presenting the award to the winner of
‘CA’s Got Talent’ – Deevesh Chudasama

Post Elocution, the
winners of Photography Competition ‘Khinch Le’ were announced. This being the
second year of the competition, received unprecedented response from students.
They were given themes on which they had to click creative photographs and
mention an innovative tagline based on the theme selected.

CA Ryan Fernandez moderating the
debate competition – ‘War of Words’

Students Committee performing the flash mob

Chief Guest Mr. Dhaval Bathia giving the
keynote address

As a part of continuous improvement and innovation, this
year, a new event ‘The Screenmasters – Short-film making competition’ was also
introduced. The competition received good response from the students with 9
entries in the very first year itself. The students had to a shoot a short-film
of not more than five minutes on the given theme. The entire audience was
amazed by the professionalism and meticulousness of CA students, even in the
arena of film-making.

Mesmerising display of talent – Spray
Painting

Audience enjoying light hearted games during the break time

BCAS Students Committee, Tarang
Volunteers along with members of HDTI Committee

The final round of the
Debate Competition ‘War of Words’ followed the Photography Competition. The debate
was moderated by CA. Ryan Fernandes with two teams of four students each. The
debate had the undivided attention of the audience as each finalist defended
their case with enthralling wit and vigour. Adding some spice to the event,
this year a fourth round was introduced wherein the teams had to interchange
their erstwhile position vis-à-vis the topic. The participants as well as the
audience enjoyed the debate to the core.

After this, the students presented a 3 minute “flash mob”
which was choreographed by CA Hrishikesh Joshi. This short stint kept the
audience alive and cheering.

After the flash mob, the charged up audience were enchanted
by the Keynote address of the Chief Guest Mr. Dhaval Bathia, a well-known
author and speaker as well as Guinness Record Holder. His speech was both
motivational and thought provoking as he used day-to-day anecdotes and examples
to convey his message. He emphasized on the need to think out-of-the-box and
‘go deep’ into the realm of your work to carve out definite success. He also
touched upon finer aspects of ‘Digital India’ and how it has revolutionized the
style of working, even for the CA fraternity.

Immediately after that,
the stage was set for the flagship and most awaited competition the ‘The Talent
Show’. To kick-start the event, a ‘Students Band’ comprising of Tej Bhatt,
Sridisha De, Aagam Jain and Jigar Jain rocked the stage. These students
volunteered for this special performance to strike the chord for the upcoming
competition.

Finally the guitars were
tuned, the keyboard was ready, the dancers were tapping their feet, and the
stage was then taken over by young and talented CA students who showcased their
talent ranging from dance, singing, instrumental, mimicry and spray painting.
All 9 finalists gave amazing performances and the audience were left spell
bound. The cheering of the crowd with claps and whistles increased with each
performance as the finalists kept on raising the bar. The judges who were
captivated by the charm of the performances had a Himalayan task in choosing
the winners.

With the clock-ticking,
the winners of the competition representing their firms were finally announced as under:

The entire evening was
hosted fabulously by Mr. Pushkar Adhikari, Ms. Tanvi Parekh, Ms. Miral Majumdar,
Ms. Aadhira Dinesh and Mr. Manthan Rawat with their astounding performances,
display of energy and loads of wit and humour. 

Mr. Prathamesh Mhatre
proposed the well-deserved vote of thanks to each and everyone involved in the
success of the event. A total number of 492 students registered for the 10th
Jal Erach Annual Day, setting an overwhelming benchmark.

Essay Writing Competition ‘Awaken the Writer Within’

Prize

Name of Student

Name of Firm

1st Prize Winner

Salonee Kabra

SRBC & Co LLP

2nd Prize Winner

Kanika Mangal

Dinesh & Agarwal

3rd Prize Winner

Anisha Talesara

Kailash Chand & Co

Rotating Trophy
went to Salonee Kabra

Elocution Competition ‘Speak Up’

1st Prize Winner

Miral Majumdar

CNK & Associates LLP

2nd Prize Winner

Tanvi Parekh

Sanjay & Snehal

3rd Prize Winner

Apurva Wani

Aneja & Associates

Rotating Trophy
went to Miral Majumdar

Talent Show ‘CA’s Got Talent’

1st Prize Winner

Deevesh Chudasama

Khandelwal Jain & Co

2nd Prize Winner

Tej Bhatt

CNK & Associates LLP

3rd Prize Winner

Vivek Rajpurohit

Sara & Associates

Rotating Trophy
went to Deevesh Chudasama

Debate Competition ‘War of Words’

Winning Team

Tanvi Parekh (Best Team Member )

Sanjay & Snehal

 

Hardik Adenwala (Best Team Member)

KNAV & Co

 

Sonal Agrawal (Best Team Member )

R M Ajgaonkar & Co

 

Salonee Kabra (Best Team Member )

SRBC & Co LLP

Best Debater

Tanvi Parekh

Sanjay & Snehal

Rotating Trophy
went to Tanvi Parekh.

Sketch & Slogan Competition ‘Leave your Mark’

1st Prize Winner

Chandrika Chaudhari

Khimji Kunverji 
& Co

2nd Prize Winner

Eashan Gokhale

Gokhale & Sathe

3rd Prize Winner

Vishishta Goyal

N P Shah & Associates LLP

Photography Competition ‘Khinch Le’

1st Prize Winner

Deevesh Chudasama

Khandelwal Jain & Co

2nd Prize Winner

 Neel Khimasia

GBCA & Associates.

3rd Prize Winner

Aurobindo Chatterjee

R R Muni & Co

Short Film Making Competition ‘The Screenmasters’

1st Prize Winner

Anirudh Parthasarathy

R T Jain & Co

Hearty Congratulations to all the
winners and their firms.

Judges for the Various
Competitions were as follows:

Competition

Elimination Round

Final Round

Essay Writing

CA Mukesh Trivedi
& CA Gracy Mendes

Elocution Competition

CA Meena Shah & CA Mihir Sheth

CA Mayur Nayak & CA Divya Jokhakar

Talent Show

Devansh Doshi & Kartik Srinivasan

Pallavi Choksi & Neetu Shah

Debate Competition

CA KK Jhunjhunwala & CA Ryan Fernandes

CA Narayan  Pasari
& CA. Shalin Divatia

Sketch & Slogan Competition

CA Chirag Doshi
& CA Divya Jokhakar

Photography Competition

CA Anand Kothari
& CA Nikunj Shah

Short Film Making Competition

CA.  Mihir Sheth & Mr Pratik Palan

The entire evening was
hosted fabulously by Mr. Pushkar Adhikari, Ms. Tanvi Parekh, Ms. Miral
Majumdar, Ms. Aadhira Dinesh and Mr. Manthan Rawat with their astounding
performances, display of energy and loads of wit and humour. 

Mr. Prathamesh Mhatre
proposed the well-deserved vote of thanks to each and everyone involved in the
success of the event. A total number of 492 students registered for the 10th
Jal Erach Annual Day, setting an overwhelming benchmark.

Study Circle Meeting on
“Build Brand U for Professional
Success” at BCAS on 13th June, 2017

Human Development and Technology Initiatives Committee of
BCAS conducted a Study Circle Meeting on “Build Brand U for Professional
Success” (Enhancing your Image as Professional) on June 13, 2017

The meeting was addressed by Mr Sunil Kini, Managing Director
& Principal Trainer; Gurukul Training & Consulting Pvt Ltd. Mr Kini in
his presentation on the subject in a very succinct but effective manner
explained that “Managing one’s image is the key to success in any walk of
life”. Your Image says a lot about you. A right Image can go a long way in your
life.

Each one of us presents an
image on the basis of which people form impressions about us. These impressions
pave the way in our professional growth path.

Whether as a self-employed professional or working with an
organization presenting ones best is an important ingredient for professional
accomplishments

The Workshop deliberated upon the following basic synopsis of
life:

–    Develop Self-Image for Superior Perception
Management

–    4 A model for Professional  Growth

–    Look the part

–    Appearance Management-Gateway to creating an
Impact

–    Importance of Professional Decorum and
Kinesics

–    Build Brand You.

–    Everyone needs image management, only the
intelligent realize in time.

The session ended with a quote: Do not underestimate the
Power of your Appearance, Build your Personal Brand for SUCCESS

The participants felt enriched with request for more such
programmes in future.

FEMA Study Circle Meeting held on 15th June, 2017
at BCAS

FEMA Study Circle Meeting was held on 15th June,
2017 on the topic “External Commercial Borrowing (ECB)”.

The group was led by CA Palav
Shah Parekh.

The depth of the
presentation was excellent with members’ interactions on various case studies
presented. The case studies were very engaging and informative. This gave
participants a 360 degree perspective of the subject.

The speaker covered updates
which were as recent as 8th June.

The participants also
benefited due to the practical exposure of the speaker who shared many insights
about Authorised Dealer’s interaction with the RBI on ECB matters.

Direct Tax Study Circle
Meeting on ‘Income Computation Disclosure Standards; ICDS VI “Effect of changes
in Foreign Exchange rates” on 20th June 2017 at BCAS Conference
Hall.

The group leader, CA.
Abhitan Mehta briefly explained the scope of ICDS VI ‘Effect of changes in
foreign exchange rates’ and the definitions of important terms mentioned in the
standard. He explained the concept of ‘foreign currency transaction’ and the
provisions pertaining to initial recognition of these transactions. The
Chairman of the session, CA Gautam Nayak commented upon the anomalies created
due to introduction of ICDS wherein the law makers have merely picked up the
language of the accounting standards and inserted them in the form of ICDS
without realising the difference between the recognition of items in books of
accounts and computation of income.

Thereafter, CA. Mehta
touched upon the provisions contained in Rule 115 of Income Tax Rules which
talks about the rate of exchange for conversion into rupees, of income
expressed in foreign currency. He also highlighted that in case of difference
between the provisions of ICDS and Income Tax Rules, the Income Tax Rules would
prevail.

CA. Mehta then explained
the difference between monetary and non-monetary items and highlighted a
practical issue which one may face when debentures / preference shares
(optionally convertible) need to be classified either as monetary or
non-monetary assets. Thereafter, he gave an overview of the year end valuation
rules for assets and liabilities and provisions of section 43A of the Income
Tax Act. 

The group leader also
discussed various SC and HC decisions such as Shell Company of China Ltd.
(22 ITR 1) (CA), CIT vs. Tata Locomotive And Engineering Co. Ltd (60 ITR 405
(SC), Sutlej Cotton Mills Ltd. vs. CIT (116 ITR 1)(SC), State Bank of India vs.
CIT, CIT vs. Jagatjit Industries Ltd. (337 ITR 21) (Delhi HC) and CIT
vs. PVP Ventures Ltd (211 Taxman 554) (Madras HC) whereby the Courts in the
context of allowability of foreign gain / loss as expenditure, have held that
nature of gain/loss – capital or revenue needs to be identified.

CA. Mehta also explained
the provisions relating to foreign operations and treatment of opening balance
of foreign currency translation reserve (FCTR) existing on 01.04.2016 as
clarified by CBDT in the FAQ’s. Lastly, he touched upon provisions regarding
forward exchange contract and the differential treatment for premium/discount
under Accounting Standards and ICDS.

The participants were
thoroughly enlightened by the presentation on the subject.

Yoga Day Celebrations held on 21st June, 2017 at
BCAS

Human Development and Technology Initiatives Committee had
organised a yoga session jointly with Indian Spiritual Healing (ISH) Foundation
on Wednesday 21st June 2017 at BCAS Conference Hall, to commemorate
the International Yoga Day.

Mr. Pradeep Thakkar, a Professional Yoga teacher and an
active member of the ISH Foundation guided the participants who attended this
programme.

He demonstrated and guided
participants to perform different asanas with ease and comfort for a healthy
body and mind relaxation.

Participants were also
taught various pranayama to cure diseases. The session ended with positive
affirmations, energy balancing and Omkar Sadhana. Many participants requested
for a regular/long duration yoga course. It was a good learning of Yogasana and
Pranayam for healthy body and peaceful mind.

LECTURE MEETING:

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LECTURE MEETING:

Panel Discussion on Industry Vs. Practice, 13th December 2013


Panelist of the Panel Discussion on Industry v/s. Practice

The Society had organised a Panel Discussion on Industry vs. Practice. The Objective of the discussion was to present to fresh Chartered Accountants and those still exploring various options, the various aspects of being in Practice or pursuing a career in the Industry.

At this event the publication “RTI for ITI” co-authored by Mr. Narayan Varma, Chartered Accountant and Ms. Shraddha Bathija was released at the auspicious hands of Mr. Pradeep Shah, Chartered Accountant


Release of BCAS Publication under BCAS Foundation ‘RTI for ITI – Right to Information for Income Tax Issues’

The panel of experienced Chartered Accountants from the Industry and practice, namely, Mr. Ashok Wadhwa, Mr. Gautam Doshi, Mrs. Bhavna Doshi, Mr. Naushad Panjwani, Mrs. Nandita Parekh were joined by Mr. Ronnie Screwvala, an eminent business person from the Media and Entertainment Industry who shared their experiences and views.

The Discussion ended with an interactive session, where concerns and questions raised were answered by the panelists. The event was attended by about 500 participants.

Video of the Panel Discussion is available free for viewing at www.bcasonline.tv for all to benefit from.

Other Programmes :

Seminar on “Scrutiny Assessments, Appeals, Penalties & Recovery”, 14th December 2013

This Seminar was organised with the objective of updating professionals on legal and procedural intricacies in Assessments, Appeals before the Commissioner of Income Tax (Appeal) and Income Tax Appellate Tribunal and related recovery proceedings. 200 participants attended the programme.

The presentations, made by the faculties were highly educative. The speakers clarified the legal issues and responded to all the questions posed by participants. The study material given by the speakers were also very helpful.


L to R: Mr. Gautam Nayak, Mr. Yogesh Thar (Speaker), Mr. Naushad Panjwani (President), Mr. Mukesh Trivedi

Professional Accountant Batch XVI, 19th November 2013

The inauguration ceremony of the Professional Accountant Course batch XVI was jointly organised by HR Committee of BCAS & H.R. College of Commerce and Economics. The ceremony was graced by President Mr. Naushad Panjwani, Chartered Accountant, Mr. Manish Reshamwala, Chartered Accountant & Mr. Parag Thakkar, Vice Principal of HR College.


L to R – Mr. Manish Reshamwala, Prof. Mr. Parag Thakkar and Mr. Naushad Panjwani (President)

The course is designed to train individuals from Accounts field in regard to the various aspects of Accounting from the perspective of a Chartered Accountant. The course saw an opening day with more than 40 participants being greatly motivated by the experiences shared by the Dignitaries.

Seminar on Labour laws, 23rd November 2013

Indirect Taxes & Allied Laws Committee of Bombay Chartered Accountant Society jointly with Chamber of Tax Consultants had organised the seminar on Labour Laws, where Mr. Ramesh Soni, eminent Labour Law Consultant, explained to the participants various aspects of the Laws viz. Employees State Insurance Act, 1948, The Payment of Bonus Act, 1965, The Employees Provident Fund & Miscellaneous Provisions, 1952, The Payment of Gratuity Act, 1972 & The Contract Labour and Abolition Act, 1970.


L to R: Mr. Naushad Panjwani (President), Mr. Ashok Sharma, Mr. Ramesh Soni, Mr. Yatin Desai (President of The Chamber of Tax Consultants), Mr. Suhas Paranjpe

More than 100 Participants registered and benefited immensely by the knowledge shared by the learned speaker.

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Lecture Meetings

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Lecture Meetings
Charitable Trusts – Recent Issues, 15th January, 2014

Speaker Mr. Gautam Nayak, Chartered Accountant, explained at length recent issues related to taxation of Charitable Trusts. In his presentation, he covered various topics including circumstances under which the proviso to section 2(15) is attracted. He explained at length, the meaning of the term “education”, significance of Registration under section 12AA, carrying on of activity before registration, Taxability of Corpus Donations, deductibility of depreciation & Issues Raised in recent CAG Report. More than 300 participants benefited from the expert analysis of the speaker.

The presentation of the speaker is available at www. bcasonline.org for all members and video recording of the lecture is made available at www.bcasonline. tv for the benefit of Web TV subscribers.


L to R: Mr. Gautam Nayak (Speaker), Mr. Naushad Panjwani (President) and Mr. Rutvik Sanghvi

Important Income-tax Rulings of 2013, 29th January, 2014

Speaker Mr. Hiro Rai, Advocate, explained important cases adjudicated in 2013 and their key aspects. In his presentation, he covered important decisions and explained their Implications. BCAS publication “FAQ on e-TDS” was also released at the hands of the speaker in the presence of one of the co-authors of the book, Mr. Ameet Patel, who is also a Past President of BCAS. More than 350 participants attended and benefited from the expert analysis made by the speaker. The video recording of this session is made available at www.bcasonline.tv for the benefit of all Web TV subscribers.


L to R: Advocate Hiro Rai, (Speaker), Mr. Chetan Shah, Mr. Naushad Panjwani (President) and Mr. Nilesh Parekh

Commonly Found Mistakes in Financial Statements and SEBI Review of Qualified Audit Reports, 5th February, 2014

Speaker Mr. Nilesh Vikamsey, chartered accountant, through a PowerPoint presentation, touched upon commonly found mistakes in audited Financial Statements and SEBI Review of Qualified Audit Reports. He specially dealt with various mistakes in relation to SMC & SME under various Acts. He covered various issues and findings of FRRB e.g. Applicability of Accounting Standards, Method of Accounting, Exemptions and Relaxations in Accounting Standards in relation to small companies.


Mr. Nilesh Vikamsey ( Speaker), Mr. Nitin Shingala, Mr. Naushad Panjwani (President) and Mr. Manish Sampat

More than 350 participants attended this meeting and found it extremely useful. The presentation is made available at www.bcasonline.org for all members and video recording of the lecture is made available at www.bcasonline.tv for the benefit of Web TV subscribers.

Interactive Session on Various issues concerning Maharashtra VAT, Central Sales Tax, Profession Tax, Luxury Tax etc, 14th February, 2014

Indirect Taxes & Allied Laws Committee of BCAS arranged this interactive meeting where


L to R: Dr. Nitin Kareer, Commissioner of Sales Tax, Maharashtra, Mr. Nitin Shaligram, Mr. Govind Goyal and Mr. Suhas Paranjpe

Dr. Nitin Kareer, Commissioner of Sales Tax, Maharashtra dealt with various issues concerning Maharashtra VAT, Central Sale Tax, and Profession Tax and Luxury Tax. Nearly 200 participants attended the meeting. The video recording of this discussion is made available at www.bcasonline.tv for Web TV subscribers.

Spirit of Service: Connecting to the Inner-Net, 18th February, 2014

Mr. Nipun Mehta was the guest speaker at the 18th Lecture organised under the auspices of Amita Memorial Trust, jointly with the Chamber of Tax Consultants.

After a welcome by Mr. Pradeep Shah, Past President of the Society, the learned speaker Mr. Nipun Mehta presented a radically different way of looking at life and its purpose.

He also shared real life examples of how each act of kindness, gifts, no matter how small it may be, contributes for improvements in the world. He showed the audience how we can connect people to the path of love, spirit of service and pledge to spread smile on as many faces. Ms. Nandita Parekh shared few words in the loving memory of her sister, Amita and proposed vote of thanks to Mr. Mehta.


L to R: Mr. Naushad Panjwani (President), Mr. Pradeep Shah, Mr. Nipun Mehta (Speaker) and Mr. Yatin Desai

Nearly 200 participants had the benefit of attending this inspiring meeting. The presentation & video recording of the lecture is made available free at www.bcasonline.org & www.bcasonline.tv respectively for the benefit of all members and Web TV Subscribers.

Other Programmes

Seminar on Presumptive Taxation for Non Residents, 18th January, 2014


L to R – Mr. Nitin Shingala (Vice President), Mr. Anil Doshi, Ms. Geeta Jani (Speaker), Mr. Kishor Karia (Chairman, International Taxation Committee) and Mr. Dhishat Mehta

A full-day Seminar on the topic ‘Presumptive Taxation for Non-residents’ was organised by the International Taxation Committee of BCAS. The objective was to update the members on key presumptive tax provisions, make them aware of the controversies to enable them to avoid pitfalls. The topics and speakers were as listed in the earlier table.

103 Participants attended the seminar.

Residential Workshop on Important Provisions of Companies Act, 2013 for HPCL, 30th & 31st January, 2014

The BCAS organised 2 day training on Companies Act 2013 for Hindustan Petroleum Corporation Ltd., a leading PSU and a Fortune 500 company. The training was held at HPCL’s Management Development Institute at Nigdi, Pune. About 30 professionals from compliance, finance and commercial areas of HPCL from across the country attended this residential program. CAs Abhay Mehta, Raman Jokhakar and Manish Sampat carried out the interactive sessions at this event on behalf of the Society.

This was a first of its kind program BCAS held for a company as part of its vision of disseminating knowledge.

12th Leadership Camp/Spiritual Retreat, 30th January to 2nd February, 2014

12th Spiritual Retreat was held from 30th January 2014 to 2nd February 2014 at the picturesque location of “Chinmaya Vibhooti”, spread across in about 62 acres, surrounded by beautiful Sahyadri Mountains at Village Kolwan, (about 40 kms from Chandni Chowk, Pune). 40 participants enrolled for the Retreat. Participants also came from places other than Mumbai. Majority of the participants reached Chinmaya Vibhooti by 12.00 noon on 30th January 2014.


Participants of 12th Leadership Camp/Spiritual Retreat.

The retreat was based on the theme of “Holistic Well-Being”, and it was designed and conducted by Swami Swatmanandaji, an Acharya of Chinmaya Mission Mumbai.

The meetings were held in the state of the art auditorium.

The discussion on the topic was beautifully conducted by  Swamiji, introducing participants to
the seven levels of transformation of an individual. Swamiji’s    powerful    talks    were    effectively    supported by PowerPoint presentations, activities, a movie workshop, and hand-outs, as well as lots of Q & A sessions.

Participants were taken through the process of how transformations can be undertaken in important areas of life: (i) Physical (ii) Emotional (iii) Intellectual (iv) Social/Cultural and (v) Spiritual.

The retreat was a resounding success due to the wonderful synergy between the BCAS participants, Swamiji and his team, and the Chinmaya Vibhooti family.

 Workshop on Photography, 1st February, 2014

 Membership & Public Relations Committee of BCAS organised a Photography Workshop. Mr. Pradeep Ruparel took the participants through the fundamentals of digital photography, using SLR/ DSLR    camera    and    explained    different    terminologies   such as aperture, exposure & ISO etc. Participants, which included members and their family, had   the     benefits     of     learning     practical     as     well     as   theoretical aspects of digital photography from this unique workshop.

Practical Issues — Transfer Pricing Documentation and Certification

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Lecture Meetings

Practical Issues — Transfer Pricing Documentation and Certification

This lecture meeting was addressed by Rakesh Alshi, Chartered Accountant on 11th October 2011 at Walchand Hirachand Hall, IMC. The speaker gave an energetic presentation on the practical aspects of transfer pricing documentation in detail with many pertinent and relevant examples and answered many questions from the audience. The meeting received very enthusiastic response and was very well attended.

L to R: Rakesh Alshi, Speaker, Chetan Shah, Pradip Thanawala, President and Surin Kapadia

Other programmes

Workshop on Filing of Service Tax Returns

Half day workshop on ‘Filing of Service tax Returns’ was held on Friday, 7th October, 2011 at the Society’s premises and was attended by approx. 100 participants. The programme schedule included presentation and replies to the queries by the service tax officials viz. Sushil Solanki, Commissioner of Service Tax-I, Mumbai, Rishi Goel,


L to R: Sushil Solanki, Speaker, Suhas Paranjpe, Govind Goyal, Pradip Thanawala, President, and Rishi Goyal

Joint Commissioner of Service Tax and V. V. Brahmashatriya, Superintendent of Service Tax and also by the speakers of the evening Puloma Dalal and Sunil Gabhawalla, both Chartered Accountants.

Integrated Security Management — Practice Approach

On Saturday, 8th October 2011, the ‘Gulmohar’ conference room of BCAS was the venue for a unique event organised by the Information Technology & 4i Committee. An introductory workshop on ‘Integrated Security Management’ was conducted for the BCAS members by ‘Secure Matrix’ — an organisation specialising in the subject. The compact group of participants got an insight into the exciting and challenging world of ‘Information Security’ under the able guidance of Saurabh Dani and Dr. Harrold D’Costa, well known experts in this area.

Mr. Dani explained the importance of Information as an asset to the organisation and the need to secure the same. He explained the various vulnerabilities that exist in a computerised environment and thus the risks that an organisation is exposed to and how these vulnerabilities can be addressed by doing a vulnerability assessment. According to Mr. Dani, generally, IT vulnerabilities arose mainly from application software (85%), Operating Systems (8%) and Devices (7%).


L to R: Ameet Patel, Nikunj Shah, Pradip Thanawala, President and Saurabh Dani,
Speaker

Dr. D’Costa briefly highlighted various types of cyber crimes, modern trends in cybercrimes and also some of the relevant provisions of the amended IT Act along with various practical case studies. He also shared with the audience a few tips for detecting forged emails. The importance of cyber data and identities was highlighted by him by referring to the cyber will of late Steve Jobs of Apple Computers.

The workshop was indeed an enriching experience for all the participants.

Public Meeting to celebrate 6th Anniversary of The RTI Act

BCAS Foundation joined Public Concern for Governance Trust (PCGT) and Indian Merchants’ Chamber’s Anti-Corruption Cell (IMC) to celebrate 6th Anniversary of the Right to Information Act, 2005 (RTI) on 12th October 2011 at Walchand Hirachand Hall, IMC.


L to R: Justice C.S. Dharmadhikari, Speaker, Narayan Varma, Julio Rebeiro, Speaker, Pradip Thanawala, President and Dara Gandhi, Speaker

Justice C. S. Dharmadhikari (retd.) delivered the keynote address and explained how Gandhiji’s objective was Freedom and not just Independence and this Freedom can be achieved only by increasing accountability and transparency through tools such as RTI.

Julio Rebeiro, Chairman — PCGT and Anti- Corruption Cell of IMC, Narayan Varma, Trustee — BCAS Foundation and PCGT, and Dara Gandhi, Trustee — PCGT, also addressed the audience and stressed on need to further strengthen RTI law and implementation. Students of Government Law College performed a street play highlighting how RTI can help in curbing menace of corruption in day to day life.

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Lecture Meetings:

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Ethical Hacking Master Shantanu Gawade (age: 14 years), India’s youngest ethical hacker addressed the members on Ethical Hacking and Cybercrimes on 19th October, 2011. Shantanu has a number of achievements to his credit. Even though he is only a Std. X student, he has a CV that boasts of several accolades including awards received at the hands of the current and former Presidents of India.

Shantanu made a detailed presentation on various areas covering:

  •  Introduction to cyber space
  •  Dangers of social networking with live demo on FACEBOOK and precautions to protect one’s self
  •  Hacking and what to do if your computer is hacked
  • Basic concepts of Malware and how to escape malware
  •  Best practices for cyber safety The meeting received enthusiastic response and was very well attended.

Other programmes:

Seminar on ‘Authority for Advance Rulings — Law & Procedure’ 

The seminar was organised jointly by the Society along with the Western India Regional Council of the Institute of Chartered Accountants of India and Indian Merchants’ Chamber. Rajan Vora, Chairman — Direct Tax Committee of IMC and Kishor Karia, Chairman — International Taxation Committee of BCAS welcomed the Chief Guest Hon. Justice P. K. Balasubramanyan, Chairman — Authority for Advance Rulings and highlighted increasing importance of AAR in bringing certainty in taxation laws and also various issues faced by taxpayers and the professionals.

In his keynote address, Hon. Chairman elaborated on the role played by the AAR and addressed several issues faced by taxpayers and professionals and also answered questions from the various participants.

Girish Dave, Advocate, the learned faculty, gave an overview of the topic dealt with synopsis of AAR and explained the background, definition, constitution and jurisdiction of AAR and the related issues. 

Nishith Desai, Advocate, the learned faculty, dealt with six recent important rulings of AAR with his masterly analysis of various issues arising therefrom. 

The seminar was very well attended by participants from Mumbai as well as outstations and was very well appreciated.

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Seminar on Finance Act, 2012 — Direct Tax Provisions

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Seminar on Finance Act, 2012 — Direct Tax Provisions

This seminar was organised by the Taxation Committee on Saturday 9th June, 2012 at Walchand Hirachand Hall, IMC. The faculty Kishor Karia, Pradip Kapasi, and Sanjeev Pandit analysed threadbare various changes in the direct tax provisions enacted by the Finance Act, 2012. The programme received enthusiastic response from the participants who gained immensely from the wealth of knowledge and experience shared by the learned faculties.

Release of BCAS Referencer 2012-13

The most awaited Golden Jubilee Collector’s Edition of the BCAS Referencer for the year 2012-13 was released on Thursday, 14th June, 2012 at Swatantrya Veer Savarkar Rashtriya Smarak, Shivaji Park at the hands of our Past Presidents Narayan Varma, Pradyumna Shah and Arvind Dalal. The release was followed by a musical programme on the theme of ‘Kal, Aaj aur Kal’ where the artists regaled audience of over 400 with melodious and memorable songs from films of Raj Kapoor, Rishi Kapoor and Ranbir Kapoor.

 6th Residential Study Course on Service Tax & VAT

The Indirect Taxes and Allied Laws Committee organised this 6th Residential Study Course on Service Tax & VAT from 22nd June to 24th June, 2012 at Rio Resort, Goa that was attended by nearly 150 participants from various parts of India including Hyderabad, Mumbai, Ahmedabad, Secunderabad, Chennai, Jaipur and Pune. L to R: Kishor Karia (Speaker), Pradip Thanawala (President), Gautam Nayak (Speaker) and Saurabh Shah Front Row: L to R – Deepak Shah, Narayan Varma (Past President), Pradyumna Shah (Past President), Arvind Dalal (Past President), Rajesh Shah, Pradip Thanawala (President), Pranay Marfatia. Behind Row: L to R – Rajeev Shah, Naushad Panjwani, Yatin Desai, Narayan Pasari Sunil Gabhawalla, Chartered Accountant, presented paper on ‘Concept of Negative List based Taxation of Services, Important Definitions, Exclusions and Exemptions’. Adv. P. K. Sahu presented paper on ‘Sale vs. Service — Overlap of VAT and Service Tax’.

Case Studies in POT Rules, Valuation of Services and Bundled Services were presented jointly by Sunil Gabhawalla, Chartered Accountant and A. R. Krishnan, Chartered Accountant.

Adv. K. Vaitheeswaran presented a paper on ‘Indirect Tax Issues in Real Estate Industry’.

A. R. Krishnan, Chartered Accountant also presented a paper on ‘Analysis of Place of Provision of Services Rules’.

 The participants gained immensely from the wealth of knowledge and experi-ence shared by the learned faculty at this residential study course. n

levitra

Inbound Investments and Recent Developments in FDI Policy

Lecture Meeting

Subject : Inbound Investments and Recent Developments in
FDI Policy

Speaker : Mr. Somashekhar Sundaresan, Advocate

Venue : IMC Hall, Churchgate, Mumbai.

Date : 8th April, 2009

1.
Introduction of the Subject :


 a) The learned speaker at the outset observed that the Foreign Direct Investment (FDI) Policy has always been a contentious issue. Recently in an attempt to simplify the FDI policy, the Dept. of Industrial Policy and Promotion (DIPP), Ministry of Commerce and Industry has issued three Press Notes being PN 2, PN 3 and PN 4 all of 2009. These notes and related issues will be the subject matter of today’s discussion. To describe in nutshell, Press Note No 2 seeks to bring in clarity, uniformity, consistency and homogeneity into the methodology of calculation of direct and indirect investment in Indian Companies engaged in varied sectors and activities. Press Note No. 3 gives guidelines for transfer of ownership and control of Indian Companies from the hands of resident Indians to non-resident entities. Press Note No. 4 lays down the policy of downstream investment by Indian Companies.

    b) As a normal rule, investments of Non-Resident Individuals, Companies and other N.R. bodies in Indian Companies require approval of Govt. The issue becomes complex where the investment is made by Indian Companies in which there is already a foreign shareholding. Till recently, though the condition of getting approval from Foreign Investment Promotion Board (FIPB) was prescribed, the criteria and expected norms and preconditions to be fulfilled for getting such approval were never laid down or prescribed. Again, one has to keep in mind the various rules and norms applicable to investments, depending on category and nature of activity of Investee Co. For example foreign investment is prohibited in Defence-related sectors, whereas certain caps or ceilings on percentage of foreign holdings are applicable to other categories. There are also some automatic routes not requiring approvals. In software industry for example even 100% foreign investment is permitted. Where F.I.P.B. initiated action against companies for not taking required approvals, F.I.P.B. required the companies to get their offences compounded through RBI. In the absence of specific guidelines on the criteria to be applied, the position of so-called erring industries was unenviable and precarious.

    c) After explaining the background, the Learned Speaker moved to detailed analysis of each Press Note and gave his comments thereon.

2. Press Note No. 2 of 2009

    Press Note 2 has introduced a new concept of treating an Indian Company as a foreign Co., for the purpose of FDI, if it is owned and controlled by persons other than Indian citizens and Indian Cos. For deciding exact category of such investee Co., the concept of owning 50% plus one share will be the determining factor.

    The concept of takeover and control regulation, where control is exercised without owning 50% plus one share is not adopted as is apparent from Press Note No. 2. What is being adopted is ability to control the composition of Board of Directors. The nationality of Directors is not relevant. So, if 50% plus one share is owned by foreign individuals and/or foreign body corporates, such Indian Co. will be deemed to be Foreign Co., for purposes of deciding the percentage of foreign investment in any Indian investee Co. For deciding the question of approval of F.I.P.B., it will also be necessary to look into issues like nature of activity, prohibited fields, sectoral caps on investments, etc. So long as investor Co. is owned and controlled by Indians, the existence of foreign shareholding in such Investing Co. can be ignored.

3. The line drawn by Press Note No. 2 is that so long as the percentage of foreign investment is less than 50%, the Co. will be treated as owned and controlled by Indians, giving it freedom to make investments in other Cos. and will be considered as investment by Indian Co. There is a general rule that the status of holding Co. whether an Indian Co. or foreign Co, decides status of its wholly-owned subsidiary. If there is a wholly-owned subsidiary of a deemed foreign holding Co. and the holding Co. in turn is owned and controlled by foreign interest, even then the subsidiary Co. will not automatically become deemed foreign Co., but the degree of foreign control will be measured by percentage of foreign stake in the holding Co. This is a departure from general rule made by Press Note No. 2.

4. Press Note No. 3 of 2009

    This Note deals with issues arising from transfer of shares. Earlier the Reserve Bank Master Circular of October 2004 dealt with threshold caps, cross-border transfers and pricing of such transfers. Now, as per this Press Note, any transfers of shares from Resident to Non-Resident, if not resulting in a change in ownership and control from Indian hands to foreign hands, does not require approval of F.I.P. Board.

5. Press Note No. 4 of 2009

    a) This deals with downstream investment where an Indian Co. having foreign shareholding invests in another Co. If such Co. makes investment in shares of other Indian Co., it is called downstream investment.

    b) Any economic sector in which such Indian Co. is operating will be its operating field. This will include even Non-Banking Financial Cos. Investment of such operating Co. in another Co. is considered by this Press Note.

    c) If the activity of a Co. is not prohibited as in case of Defence-related fields, then investment in that Co. through FDI will be permitted, subject to sectoral restrictions or ceiling on percentage holding. To illustrate, a software activity is not a prohibited activity, so any investment in such software company even by deemed foreign company is not prohibited, nor will it be violation of Exchange Control Regulations. However, where a company wants to act purely as investment company and does not participate in the activity of investee Co., then the approval of F.I.P.B. will be required.

    d) In respect of Non-Banking Financial Cos. having many activities such as financing, hire-purchase, underwriting shares and rendering other services, then approval will have to be taken by NBFC.

e) Where a foreign company wants to buy and sell shares on Indian stock market, FII Registration will be necessary. There are restrictions on holdings and dealings of Foreign Institutional Investors in Indian companies; percentage caps, sectoral restrictions govern such investments. In contrast with restrictions on purchase of shares, sale of shares by Non-resident on stock exchange is permitted. After such sale, the proceeds can be repatriated without any prior permissions or approvals.

f) There is restriction on buying shares on stock exchange. Where shares are purchased for investment purposes, the approval of F.I.P.B. will be necessary. For operating-cum-holding company the real test will be whether ultimate investee company is on automatic route or whether there exist any restrictions qua activity, or percentage holding.

6. The learned Speaker thereafter ably replied various questions raised by participants. The meeting then terminated with a vote of thanks to the learned Speaker Mr. Somashekhar Sundaresan.

MVAT Audit — Some important issues

Lecture Meeting

Subject : MVAT Audit — Some important issues



Speaker : Govind Goyal, C.A.


Venue : I.M.C. Hall, Churchgate, Mumbai.



Date : 21st January 2009








(1) While introducing the subject, the speaker said that
Notification of October 2008, introduced new Form No. 704 being Report of the
Auditor. The Commissioner of Sales Tax issued a Circular stating that all
Reports submitted after 10th November 2008 shall be in new Form No. 704 and not
in old Form.

(2) After studying the new Form, the WIRC of the Institute
made representation to the Commissioner of Sales Tax (CST) that certain clauses
in the new Form need to be changed, since they cannot be certified by Chartered
Accountants and are inconsistent with provisions of law. After discussion, the
Commissioner agreed that those clauses need to be changed. Another Circular was
issued in December 2008 clarifying that for year 2007-2008, the Auditor will
have an option to submit his Report either in the old Form or in the new Form
No. 704 and the same should be submitted before 31st January 2009.

(3) In Part-I of old Form No. 704, there were 9 statements to
be certified by the Auditor. This number is now increased to 15 certificates. He
has now to certify that he has read and understood the instructions given in the
new Form. He has also to certify that the dealer was carrying on his business
activity from the principal place and additional places registered with the
Sales Tax Department. It is difficult for the Auditor to issue such certificate.
His duty is to audit books with the supportings. Similarly, the new Form
requires him to certify that all transactions recorded in the books of accounts
are reflected in bank statements. This is not possible particularly when the
dealer followed mercantile system.

(4) In Part-II, general information about business of auditee
is required to be given. Now certain ratios are to be reported and they are :

à
Net turnover to total turnover


à
Cash Sales to Total Sales


à
Cash Purchases to Total Purchases


However, neither the MVAT Act nor the Central Sales Tax Act
defines Cash Sales or Cash Purchases. It is not clear whether they include
cheques, or credit card.

(5) The auditor has to certify details of purchases over
Rs.5,00,000 from new local suppliers. The term new local suppliers means persons
from whom no purchases were made in preceding year. This casts additional
responsibility to find out the position for preceding year also. This makes the
Auditor’s duty onerous.

(6) Part-III of Report contains schedules :


In one schedule, the Auditor has to certify figures of
Sales/Purchases per returns, the figure determined from books and
re-conciliation of differences with reasons.

(7) In reporting, the Auditor has to give details of the
Auditor who has certified the accounts statements under the Income-tax Act. The
speaker observed that this is again inconsistent because there may be cases
where audit is conducted under the Companies Act or Co-op Societies Act or Trust
Act; but those may not be required under the Income-tax Act.

(8) Determination of Gross Turnover of Sales and Purchases :


Turnover means aggregate of Sale Price or Purchase Price of
transactions effected during the year. Sales/Purchase includes not only
Sale/Purchases of goods traded or manufactured by the dealer, but also covers
spares, components, packing materials, fuel. It also includes Capital goods. Net
turnover will not include taxes collected or paid. However, the gross turnover
of Sales/Purchase will include tax collection. Labour charges are to be excluded
since they are not sale of goods. Deduction should also be made of goods
returned within 6 months from the date of sale. While determining the turnover
the Auditor must take note of sale/purchase of scrap, sale/purchase of capital
goods like plant and machinery and miscellaneous purchases included in printing
& stationery, in repairs and maintenance charges, and in sales promotion
expenses. The Auditor must keep in mind the accounting standards, and the
guidance note of the Institute states that taxes collected by dealer as well as
excise duty shall not form part of income. If any portion of collection of tax
and duty has remained unpaid, the same should be shown as liability.

(9) For determining turnover of inter-State sales, deduction
is also to be made of freight and transport charges included in sale price.
Thereafter for Gross turnover of sales, the taxes collected and excise duty is
to be added.

For quantifying taxable sales in Maharashtra, deduction is to
be made of inter state sales, exempt sales, labour charges and taxes and excise
duty collected, to arrive at net taxable turnover liable for MVAT.


Computation of Tax : The taxable turnover is to be
bifurcated into five Schedules according to their categories. The tax rates are
NIL for Sch. A (exempt goods), 1% for Sch. B Goods, 4% for Sch. C and specified
rate for petroleum and liquor referred in Sch. D and for residuary goods in Sch.
E the rate is 12.5%. The Auditor will determine and state net taxable sale under
each schedule giving entry No. and tax rate. If the dealer has collected excess
tax, the same stands forfeited in favour of Government.

(10) In turnover of purchases after necessary deductions, the
Auditor has to verify taxes paid on purchases for determining set-off or input
tax credit.

Conditions for allowance of set-off :

a) Goods purchased should be from registered dealers.

b) The entries in the register should be supported by tax invoices.

c) The purchase register and tax invoice should give the date, invoice No., name and address of supplier, registration No., net purchase price and VAT charged separately. The provisions of Rules 52, 53 and 54 dealing with set-off working should .be borne in mind. If the VAT charged is not mentioned separately, set-off will not be granted. The aggregate amount of set-off is subject to statutory deduction per Rule 53 and negative list per Rule 54.

11) Tax on purchase of goods and packing materials used for manufacture and packing of tax-free goods is not allowed for set-off.
 
12) Where there is difference in tax due or set-off claimable per working by Auditor and per returns of dealer, the auditee should be advised to file revised return and pay the difference before finalising and submitting Form No 704. A note should be taken of revised return. In the said report, the auditor should also state the period for which further set-off is due and resultant refund due.

13) Works  contracts:

In works contracts, determination of taxable quantum of sale forming part of Final Bill and the tax rate applicable thereon is the most complicated region in M-VAT Audit.

14) Whether a particular contract is a works contract or a sale simpliciter is a matter of controversy. Judgments of the Apex Court on works contracts of almost similar nature vary from each other. Assuming a particular contract is a works contract, determination of sale component is equally challenging. The gross amount of bill is a composite figure involving sale of material and sale of services. Tax is not leviable on service element under MVAT. Rule 58 prescribes mode of determination of sale price. From gross amount of bill eight items of deduction are to be made; some of which are:

i) Architect’s  or designer’s  fees

ii) Labour and service charges in respect of contract

iii) Water charges

iv) Profit margin of dealer in respect of Labour/ service charges. The balance constitutes sale price on which tax is payable @4% or @12.5% (general rate) or @ 8% under the composition scheme, depending on category of goods involved.

15) In actual practice, dealers undertaking works contracts are reluctant to disclose items like expenses on services, architects fees and their profit margin. To overcome this, the State Government has evolved a table for various types of contracts, such as construction contract, fabrication, painting, air conditioning, repairing and annual maintenance contract. The rate of deduction for component of services are mentioned against each category of con-tract. To illustrate, in building construction contract the value of services will be taken” at 30% and the balance of 70% will be treated as sale of material liable to VAT.

16) In Practice, it was found that contractors felt that in spite of prescribed table, it is not possible for them to make invoice. A representation was made to design a scheme akin to composition scheme. So u/s.42 of the MVAT Act, composition scheme is designed providing 8% of total contract value will be regarded as MVAT payable. Another representation was made requesting for reduction of rate of 8% on construction contract which was reduced to 5% from 20th June 2006.

If construction contractor is opting for composition, then their set-off on purchases is reduced.

17) Where composition is not opted, the normal set-off as per Rule is permitted. If, it is opted, the set-off claim is scaled down, if composition is un-der 8% scheme, set-off amount will be reduced by 36%. If composition is under 5% scheme, set-off clause will be reduced by an amount being 4% of total purchase price. The normal composition rate is 8% applicable to all works contracts, whereas building contractors can opt for 5% for construction contract and 8% for contract other than construction contract. The set-off on works contract other than construction contract is to be scaled down by 3% of purchase amount and for construction contract this scaling down is by 4%.

18) Unlike the composition scheme applicable to hoteliers or retailers where entire turnover is required to be considered, construction contractors can opt composition @ 5% qua contract. Similarly, under other composition scheme the dealer is not permitted to collect tax from customers. But under the works contract composition scheme, the dealer can collect tax. These aspects must be kept in mind while determining gross turnover and net turnover. While going through profit & loss account, the Auditor should verify whether hire charges are credited to profit & loss account. These may be in respect of leasing of goods. Earlier there was a separate Act-‘Right to use goods Act’. All amounts received for leasing of goods, machinery, furniture were liable to MVAT atapplicable rates which are 12.5% for leasing of machinery, furniture and 4% for computers. So these receipts should be considered in determining gross and net turnovers.

19) Provisions applicable to mandap decorators, hotel industries, 2nd-hand car dealers, retailers and bakary dealers:

Though the composition scheme to  mandap decorators was announced in 2007, the same was made applicable from 1-4-2005. All these dealers can discharge their tax liability by paying 1.5% tax on total turnover.

In case of dealers in hotel industries, second-hand car trade, retailers and bakery dealers, the Auditor should verify weather they have applied for in prescribed form to the Revenue authorities for coming under the composition scheme. Application has to be made either at the time of registration or at the beginning of financial years. Once the dealer opts for the scheme, he cannot come out of the scheme till the end of that financial year. Similarly these dealers are not permitted to collect tax from customers. This is a pre-condition. Therefore, sale price will not be treated as inclusive of tax. The tax @ 8% will be payable on entire sale price. In case of hotels charging rent for rooms, since rooms are immovable property, the rent earning is not liable to MYAT tax.

Where room hire charges are inclusive of breakfast or breakfast & lunch or breakfast, lunch & dinner, the charges attributable to these facilities are determined by applying the following table to gross rent collection, viz. :

For breakfast        –  5% of total rent
For breakfast & lunch    –  10%
For breakfast, lunch  & dinner   –  15%

The amount worked out at applicable rate to gross room rent will have to be considered for arriving at taxable sale price.

20) Determination of taxable turnover in case of C.F.I. Units located in backward area:

Where units are enjoying incentives whereby they do not have to pay any tax on turnover of sales, turnover of sales and purchases are determined in normal manner but set-off on purchases will not be allowed, but they are entitled to claim refund of taxes paid on purchase including tax paid on capital goods.

CFI unit in backward area, similar deduction is to be made. From final bill, the payment is made to CFI units for purchase of goods used in works contract. The remaining amount will be liable to tax @ 4% or 12.5% as the case may be.

21) As regards refunds till March 2007, the refunds due per return up to March 2007 were allowed to be carried forward. But refunds due for 2007-2008 cannot be carried forward. Refund due as per return or revised return for March 2008 or due as per Audit Report cannot be carried forward.

22) Re : Medicine  dealers  if pharmacies:

Till June 2007, turnover was determined as per MRP Scheme. From July 2007 the determination is to be made as done in normal dealers. Till June 2007 tax was collected from manufacturers on basis of MRP. The said scheme is discontinued. All medicine dealers had to submit stock statement as on 30-6-2007.

23) MVAT applicable to liquor licence dealers: S. 61:

Turnover limit of Rs.40 lakhs applicable to normal dealers does not apply to liquor licence dealers.

The dealer may permit other dealer to use his licence for liquor trading. The person using the licence has also to get his accounts audited, irrespective of the amount of turnover.

24) As regards Kirana merchants, they can opt for the composition scheme. If they have opted for the composition scheme, the tax rate will be 5% or 8%. If they have not opted, difficultly arises in determination of turnover of various categories of goods liable for different rates e.g., sugar, wheat, pulses are tax free, whereas on items like toothpaste, tax is 5% and on sale of dry fruit the rate is 4%. Very often he makes one cash memo for all these items, so also he does not make cash memo but records sales in his diary. As per Circular of the Commissioner and guidance note of WIRC, in all such cases, the turn-over of sales is to be determined in ratio of turnover of purchases as per purchase register. By applying above ratio, the sales turnover is determined.

25) Textile  processors:

Till 31st March 2005, they were exempt from tax. This was withdrawn under the MVAT Act. Processing is a works contract. On basis of purchases of chemicals and other materials, the taxable turnover is determined. In response to representation of Textile Processors Associations, the Finance Minister in Budget speech, assured that textile processing will not be treated as works contract and their trade will be exempt. Notification was then issued granting exemption to textile processors. Set-off will not be allowed on taxes paid on purchase of materials and capital goods. However, per Notification of 23rd October 2008 as per Rule 53(10) they will be entitled to claim set-off on purchases of capital goods and taxes on material used for processing. The exemption being applicable from 1-4-2005, those textile processors who have paid VAT as works contractors, can revise their returns and claim refund of taxes paid.

The revised Audit Report will have to be submitted giving reasons for revision. Revised Report should be filed only after the revised returns are filed by the dealer.

26) Verification  of CST  Returns:

S. 5(1) to S. 5(3) describe three different categories of inter-State sale, export sale & export sale without taking delivery of import. In such cases the ultimate consumer should pay charges of Bill of Entry, Customs duty and forwarding charges. Otherwise claim u/ s.5(2) may get disallowed.

S. 5(3) deals with transaction where the sale is effected to actual exporter. Such dealer should furnish declaration Form H which can be given for inter-State purchases as well as local purchases. Sale on Form 11 is treated as inter-State sale even if exporter is located within Maharashtra.

Export of goods without taking delivery through negotiation of Railway receipt or lorry receipt. The movement of goods should not be broken, if the claim of inter-State sale is to be proved. Secondly all dealers in the transaction must be registered dealers. Under CST, it is also necessary to collect Form E-1 from the selling dealer and Form ‘C’ from the purchasing dealer. In the event the dealer negotiating the documents fails to collect Form E-1, but collects only Form C, then such transaction will be treated as inter-State transaction liable to CST. The dealer negotiating Railway or lorry receipt has to issue Form E-2 to the purchasing dealer.

S. 6A of the CST Act deals with branch consignment transfer.

(27) Branch  transfer and  consignment sales:

Where movement of goods from one State to another State is otherwise than under contract of sale, then it is to be considered as branch transfer or consignment transfer. The conditions for falling under category of branch transfer are:

a) Sale is not under  contract  of sale

b) The consignee or branch should furnish declaration in Form F.

The Auditor should make note of missing Form C and Form F, and if the same are expected to be received, tax difference need not be paid. The revised return also need not be filed if dealer is confident of receiving missing forms. Suffice if the Auditor clarifies his stand in final report on chances of receiving missing forms.

(28) Time limit  for submitting    Audit Report:

As regards due date for submitting Audit Report in Form-704 it is 31st January 2009; the speaker informed that representation is made to the Commissioner for extending the date up to 31st March 2009. The speaker advised that without waiting for such extension, the Auditor should file report by 31st January 2009.

The learned speaker then replied queries raised by some members. The meeting terminated with a vote of thanks to the learned speaker.

TDS Law & Procedure – Recent Developments

Subject : TDS Law & Procedure — Recent Developments

Speaker : Rajesh Kothari, C.A., Past President, B.C.A.S.

Venue : I.M.C. Hall, Churchgate, Mumbai.

Date : 13th May, 2009.

1. Mr. Kothari, while introducing the subject remarked that the provisions of TDS are not only complex, difficult to interpret and still more difficult to implement. It expects the deductor to discharge his duties gratis on time bound basis. For due performance there is no reward but any failure on his part attracts not only interest, penalty and prosecution but he has to suffer disallowance. The injustice is aggravated where procedural changes are made in last week of March made effective from 1st April of the year following. For example, introduction e-payment of TDS is to be made after 1st April, 2009 instead of using paper challans. On 11th April, 2009, the Press Note has extended the time limit for e-payment till 1st July, 2009. Till then TDS can be paid by using challans presently in use.

2. Changes made in Sections & Rules :

i) Sec. 199(1) of the Act dealing with grant of credit of TDS was amended to provide for a situation where income becomes assessable in the hands of person other than the recipient due to operation of Sections 60, 61, 64, 93 & 94 of the Act.

ii) In case of AOP or Trust, the Rule provides that where the income is assessed in the hands of a member, the credit for TDS thereon will be available to him.

iii) In case of a Trust the credit will be given to Trustee. Where the income is assessable in hands of beneficiary, the credit will be available to him.

iv) Where the asset generating the income is held by Partner on behalf of firm, the credit for TDS will be available to the firm.

v) Where deductee is holding asset as Karta of his HUF the credit of TDS will be available to the HUF. A practical difficulty may arise where asset of HUF is held by a member other than Karta, the income though gets assessed in hands of HUF, the credit of TDS may be in jeopardy. Similar difficulty may arise in case of partial partition of HUF. In that case, the assessment of income will get continued as HUF income even though the partitioned asset will go outside the books of HUF.

vi) In case of a property deposit, security, units or shares held by an individuals jointly with others the credit of TDS will be given in the ratio of share of deductee and other co-owners.

3. The mechanism provided for claiming of Credit :

    In the above situations the concerned deductees have to furnish a declaration to the deductor giving details of names, addresses and PAN of or co-owners to whom the credit of TDS is to be given. There is no specific Form of Declaration. It can be given on plain paper also. Though no time limit is prescribed for furnishing the information to deductor, the deductee should ensure that such declaration is submitted before deductor effects deduction.

    The deductor has to issue certificate of deduction in the names of persons mentioned in the declaration.

4. Method of Accounting decides the Year of Assessability

    The speaker observed that different methods of accounting followed by deductor & deductee may cause mismatch of information given by deductor to I.T. Dept. and the year in which the deductee is submitting such income to tax. The deductee will be entitled to get credit.

5. Judicial views on TDS provisions :

    Delhi High Court as well as P & H High Court have taken a stand that credit should not be denied to the assessee on technical ground.

    i) In case of Escorts Ltd. the company was following accrual method. The Certificate for TDS was not available at the time of filing the return. The assessment was completed. The assessee claimed the credit in the year in which TDS certificate was received.

    ii) The Delhi High Court held that Sec.155 (14) empowers the Assessing Officer to consider the TDS even after 2 years from completion of assessment. Hence the A.O. should have given the refund of tax even though the assessment was completed.

    iii) In case of Sonal Bansal before the P & H High Court, the assessee, holding Deep Discount Bonds, received proceeds on maturity. The difference between maturity value and issue price was treated as interest by Bond issued and TDS was effected thereon. However, these bonds were purchased in the market at premium. The bond holder treated the difference between maturity value and his cost as interest since the seller of Bonds to him had paid Capital gain tax. So in such case, interest accounted will be less than income adopted for TDS. The Court took the view that he is entitled to tax credit because otherwise no one would get credit for TDS suffered.

6. Other Procedural Amendments

i) Rule-38 has been amended. There is no change in time permitted for effecting payment of TDS to Government. The only change is applicable to tax deducted by Government. Such tax had to be paid into the treasury on same day. Now, the time limit as is applicable to Non-Government organisation will apply even to Govt. So now the time limit will be 7 days from end of month in which tax is deducted. The time limit of 2 months will not apply, as the Government accounts are on cash basis.

ii) The payments can be made quarterly after obtaining permission of A.O. The mode of payment is for the first time prescribed in the Rule. Instead of challan No.280, now the challans should be in Form No.17 to be paid electronically.

iii) No consequences are prescribed for not paying challans electronically after 1st July, 2009. Tax deducted prior to 31.03.2009 can be paid by old challans.

iv) The new mode of payment will also apply to Government. In Form No.17, there is no need to put Assessment year but Unique Transaction Reference No. (UTN) is to be put. The challan has to make reference deductee-wise, giving the PA Nos. of the deductees , if they are ten or less. If the deductees are more than ten, a separate statement is to be prepared. In the Challan you have to give PAN of Deductor & the name of his Bank. Last year on 14th July, 2008, CBDT has come out with a Circular No.5 of 2008 to deal with payment from third party’s Bank A/c. The software will develop unit Transaction No. which is to be given in all statements submitted to LT. Department. There may be situations where PAN is not validated or where deductee’s PAN is wrong put, there may be some difficul ties.

v) Challan No.17 does not provide for the information under which Section the tax is deducted. However, in Form 26Q the section under which payment is made is to be given; as well as Name and PAN of deductees section-wise. Therefore Form No.17 must be used separately for each section.

vi) Form 27Q applies  to TDS from payment  to Non-Residents or Residents but not Ordinary Residents.

Similar difficulty may arise in case of concerns having multiple branches and multiple PAN Nos./TAN Nos. Difficulties AI will arise in matching payments. Though payments can be made by credit card or Debit card, no facilities are available in software on websites. Similarly, in case where service tax is paid in a Bank other than permitted Bank, the assessee can’t be asked to pay tax again.

vii) As regards Tax Collected at Source, the Press Note states that the time limit will be 7 days from end of month & the time limit of 2 months does not apply to TCS.

7. Amendments in time limit for Issue of TDS Certificates

i) Rule 31 deals with issue of IDS Certificate. It applies from 01.07.2009. Formats of Form No. 16 & 16A remain unchanged. In respect of provision made in the accounts at year end, the TDS was payable before 31st May. Thereafter deductor was duty bound to issue certificate within 7 days i.e. 7th June. Now, it is provided that certificate should be given within one week from date of payment to Government. A Consolidated Certificate can therefore be issued within 1 month from close of the year. So, in cases where tax is paid after 30th April to 31st May, a separate certificate will have to be given.

As regards duplicate certificate the only change is that deductor should certify it as duplicate certificate.

8. Additional Information to be provided in Forms of TDS Certificates & in the Returns

i) Form No.16 has been modified. The new form includes TDS certificate No.(optional), UTN, Information whether PAN is uploaded and validated by LT. Department, Information about Gross Amount paid/ credited to such employee. This amount will be different from amount chargeable as salary due to perquisites and exempt allowances. The details of perquisites are required to be given in Form 12-BB (though now not in existence).

ii) Form 16A certifies payments other than Salary. Certificate of TCS is to be given in Form No. 27E. Earlier there was a provision for issue of consolidated certificate, the consolidation of TCS between two periods, April to September and October to March is now deleted. Now TCS Certificate is to be issued every month.

iii) Rule-31A  –  Quarterly   Statement   of TDS and TCS – This is to be furnished in Form 24C. If any deductor has to cancel the TAN, he has to approach TDS Officer for cancellation. Till the cancellation is not effected, obligation of filing Returns, Challans & other information continues.

iv) It is now provided that Form No.24C is to be filed on quarterly basis whereas Forms 24Q, 26Q, 27Q should be compiled on quarterly basis but the same are to be e-filed collectively before 15th June of succeeding financial year. Uptil now the obligation to submit Form 24Q and 26Q on software like diskettes or CDs was applicable to bodies corporate or concerns and individuals to whom Tax audit was applicable or where number of deductees are less than 50. Now, since every assessee has to make e-filing, hence filing through diskettes or C.D. Rom is not necessary.

v) The time limit for submitting Form 24C is 15th July, 15th October, 15th January and for March quarter it will be 15th June. Form 24C is newly introduced and is designed afresh. The information is to be filed on quarterly basis.

9. Filing of the details of total expenses incurred each month under each head to which TDS applies i.e. Sec. 192 to 195

i) The total expenses will include revenue as well as capital expenditure on which IDS is deductable. It will also include the amounts on which tax is not deducted due to submission of declarations or orders of Assessing Officer permitting non-deduction.

ii) Where u/s:194C, TDS is required to be made the debit effect may be to various account heads like Printing and Stationery, Advertisement and Publicity, Repairs and Maintenance etc. Therefore, Form 24C should contain the details of all such account heads and expenses from which IDS is made. This creates the need to keep back up support if TDS assessment is taken up.

iii) As regards salary, the Form requires you to mention expenses for the month on which TDS is liable to be deducted as well as the amount of salary on which IDS is deducted. As per law, for working out TDS on Salary, a bonafide estimate of salary for the whole year is required to be made for ascertaining TDS amount. As regards exemption and allowances, it is difficult to ascertain on monthly basis.

iv) As regards Returns for Tax collection at source, Similar Form Nos. 24Q, 26Q & 27Q are not to be filed every quarter though the back up information is to be maintained. Form 16AA is omitted.

10. New Requirements of Form No.27 BB applicable to TDS on payment to Non Residents. (applicable Forms No. 15CA & 15CB)

As per Form 15CA, information is to be given by a person making payment to NR. Such person has first to obtain certificate from Chartered Accountant. Such certificate will be in Form 15CB and remittance cannot be made unless this Form is submitted. After the Form is submitted electronically thereafter print out is to be signed and submitted to tax authority through deductor. The PAN of the recipient is also to be given.

11. Recently, Bombay High Court has held (293 ITR) that even if deductor has not deducted the tax, it cannot be recovered by the LT. Department from the deductee.

12. In 115 TTJ it is held that if the employer is not issuing certificate in Form 16 to employee then the A.O. must use his statutory power to enforce compliance from employer.

13. In Hindusthan Coca Cola’s case it was held that if the tax is deducted from employee, he will not be liable to pay to Govt. any shortfall in deduction for any mistakes of the deductor. In such cases, deductor may suffer disallowance u/s. 40(a).

14. In case of Mahindra and Mahindra vs. DCIT it was held by Special Bench that time limit for reopening as applicable to normal assessment will also apply to l’DS assessment. No enquiry can be initiated after expiry of 4 years or 6 years depending on facts and circumstances.

15. Supreme Court in Larsen and Toubro case has held that employer is not under obligation to collect supporting evidence in respect of claims of employees. Similarly, TDS is required to be deducted from salary to foreign employee even if income is not liable to tax.

The meeting then terminated with a vote of thanks to the learned speaker Mr. Rajesh Kothari.

Certain issues on Accounting Standards with special emphasis on AS-22 and AS-10 — Revised.

Lecture Meeting

Subject : Certain issues on Accounting Standards with
special emphasis on AS-22

(Deferred Tax) and AS-10 (Fixed Assets)- Revised.


Speaker : Narendra P. Sarda, Past President, ICAI


Venue : Walchand Hirachand Hall, IMC



Date : 23-4-2008


1. Scope and coverage of subject :



The speaker dealt with recent developments, revisions and
reviews of existing Accounting Standards, as well as the new Accounting
Standards which will be taking effect from accounting years ended 31st March
2008 and subsequent two years. He divided the subject into five heads, viz. :

(i) AS-22 — Accounting for Taxes on Income

(ii) AS-10 Fixed Assets — Revised Standard (yet to become
effective).

(iii) AS-11 — Accounting for Changes in Foreign Exchange
Rates — Certain Issues and Developments.

(iv) AS-15 — Employees Benefits — Certain Issues and
Developments.

(v) Recent Pronouncement of Institute in respect of
Derivative Instruments.


2. General :


The Institute has announced that Company’s Accounting
Standards Rules are applicable to any accounting year commencing on or after 7th
December 2006.

Issues :

A question arises in cases where certain deviation in
existing standard is recommended by the Institute but not yet incorporated in
Rules, then for reporting on compliance of Accounting Standards u/s.210, whether
the Auditor should report such deviations as and by way of information or should
qualify true and fair view of accounts. The speaker said that the deviation
should be reported as information and not as qualification.


3. AS-22 — Accounting
for Taxes on Income :


Issues and Developments in respect thereof :




(a) Timing difference considers tax effects of differences
in book income and taxable income. Timing differences get reverted in future
and are taken care of by incorporating Deferred Tax Assets and Deferred Tax
Liability. The permanent differences are due to disallowances. They are
ignored for Deferred Tax treatment.

International Accounting Standard (IAS-12), takes Balance
Sheet approach for deferred tax treatment. Such situation arises in
revaluation of assets, as well as in amalgamations and mergers.

(b) Tax outgoing is treated as an expense chargeable to
Profit & Loss Account. It includes two elements, current tax and deferred tax.
In a situation when there is no profit from current year’s activity, but
surplus in accounts is due to reversal of deferred tax liability. In such case
whether the dividend can be declared out of such surplus ? According to the
speaker, it is permissible.

(c) For determining the liability under MAT, not only
current tax provision but deferred tax provision is also to be added back.

(d) Accounting of Deferred Tax Asset — When turning
differences are having the effect of reducing accounting income below taxable
income, it gives rise to deferred tax asset; whereas when accounting income is
more than tax income, it results in deferred tax liability. For deferred tax
asset, Para 15 and Para 17 of AS-22 are relevant. Para 15 states that if there
is a reasonable certainty of recovering the losses in future, then only
deferred tax asset should be recognised.

Para 17 talks of virtual certainty of future profits
sufficient to absorb current and brought forward losses and depreciation.
Before creating deferred tax asset, the auditor should ask for convincing
evidence about certainty of future profit. Accounting Standard Inter-pretation
(ASI) No. 9 provides guideline for verification of credibility of evidence
propagated by client companies. This factor assumers still greater importance
when the current years’ losses include long-term capital losses. This is
because such losses can be set off only against long-term capital gains.

(e) Financial Report Review Board (FRRB) of the Institute
verifies the published accounts recognising deferred tax assets and ascertains
from concerned members whether due care is taken by them in this regard
i.e., virtual certainty of future profits, particularly when the amount is
material.

(f) Reassessment and review of deferred tax asset created
in earlier years can be made if the circumstances demand such adjustment after
proper review.

(g) In amalgamation of two companies or absorption of
loss-making by profit-making company, the deferred tax assets/liabilities of
loss-making company should be dealt with after considering profits and
profitability of amalgamated company ASI-11 deals with both situations.

If the loss-making company is taken over in amalgamation
scheme and that company has not created deferred tax asset due to
non-existence of virtual certainty of future profits, then the profit-making
company taking over such loss-making company can create deferred tax asset in
its books, since it will be entitled to claim set-off of such losses.

(h) There may be a situation that a newly started company
has losses and unabsorbed depreciation for last 3 years, which gives rise to
deferred tax asset. At the same time, it has provided depreciation in accounts
which is less than depreciation allowable under the IT Act, in such case it
will give rise to deferred tax liability. Therefore both deferred tax asset
and liability will require consideration. Unless there is virtual certainty of
future profits, deferred tax asset should not be accounted. Since to the
extent of deferred tax liability there is certainty, the deferred tax asset
can be accounted to that extent. This issue is covered in background material
of the Institute on AS-22.

(i) As regards tax rate, if at the end of the year the
budget has provided for a change in rate of tax, it should be given effect to.
No discounting of rates is permitted.

j) Presentation of deferred tax asset/liability. Earlier year’s brought forward balances should not be mixed up with current year’s figures and current year asset/liability cannot be net out. In Schedule VI, the deferred tax liability should appear after unsecured loans but before current liabilities and provisions, so also deferred tax asset should appear after investments but before current assets.

k) If deferred tax effect is not accounted in earlier years, but is proposed to be accounted in current year, then such adjustment can be made through revenue reserve. It there is no reserve, then it should be debited to profit and loss account.

l) If a company is having tax holiday for certain years, say, u/s.80IA or u/s.80IB, then though there is timing difference in accounting income and tax income, ASI-3 provides that if out of timing differences, some figures are going to reverse after tax holiday period, it is necessary to provide deferred tax liability only on such amounts. ASI-5 considers the situation where company’s income is covered by exemption u/s.l0A and u/s.l0B.

m) ASI-4 deals with losses under the head Capital gains, which are adjustable only against future capital gains. Therefore normally there cannot be virtual certainty. So ASI-4 advices not to create deferred tax asset with reference to capital loss.

n) ASI-6 considers situation under MAT liability where book profit is higher than taxable income, the tax is payable with reference to book profit @ 7.5% plus surcharge. In such cases, on timing differences the tax at normal rate of” 30% plus surcharge should be considered.

o) In respect of quarterly reporting of income for listed companies, the average rate of tax on an income should be ascertained. Such rate should be applied to the income for the quarter.

II. AS-IO – Fixed Assets – Revised Standard (yet to become effective) :


i) Exposure draft was issued in 2006. After considering the views thereon, Press Note of the Institute, announced in August, 2006 that the draft is finalised. It was proposed to make it effective from 1-4-2009. Yet the effective date is not announced, presumably because the Company Law Board will have to modify the Accounting Standard Rules suitably.

There are some conceptual differences in the Revised Standard. This is so in respect of spares and components which are purchased or in stock at year end. If these components are exclusively for use in plant and machinery, then requirements of Revised Standard will have to be complied with.

ii) The Revised AS-10 will be dealing with Accounting of Fixed Tangible Assets as well as Depreciation Accounting, which was hitherto governed by AS-6. So earlier AS-6 will stand withdrawn after its merger with revised AS-10. From the earlier AS-10, Para 14 & Para 24 will continue. Para 14 deals with assets held for disposal, so also Para 24 deals with non-current assets for disposal.

iii) Institute has issued ASI-2 on machinery spares which has discussed the circumstances when it will be machinery spares and when it will be fixed assets. This interpretation will also become inoperative after revised AS-lO becomes operative. After such date, machinery spares, which can only be used in machinery will be treated as machinery and not as part of inventory spare and components under current assets. So ASI-2 dealing with inventory will not apply to machinery spares.

iv) For real estate developers, the applicable Accounting Standard will be AS-10 and not AS-7. For revised treatment to machinery spares, the test of economic benefits will be required to be satisfied. So also cost thereof should be’ ascertainable. For subsequent expenditure on existing fixed asset, current repairs will be charged to profit and loss account, but substantial expenditure which increases existing capacity of machinery will be capitalised and depreciated thereafter.

v) Revised AS-10 also deals with component accounting. While accounting, the WDV of component replaced should be transferred to profit and loss account and cost of new components should be capitalised and depreciated. Alternatively, old component’s WDV can continue and of new component to be debited to Profit and Loss account. These are the two options given.

vi) Where inspection of useful balance life is a costly affair as in case of aircrafts or where major replacement is a feature of, say, every four years, it was earlier recommended to spread such cost over four years by creating provision every year. But, now it is not permitted by AS-29. This Standard does not permit provision where expenditure is not actually made. Provision can be made for existing obligation and not for future obligation.

vii) The solution is to capitalise such expenditure and then amortise over certain years and write off old unamortised amount. Cost of dismantling of old asset can be added to new asset and depreciated.

viii) On the issue of Revaluation of Fixed Assets, the speaker listed the rules to be followed, viz. :

a) Revaluation should be done uniformly for en-tire class of assets like building machinery, etc. Revaluation at fair value and not any ad-hoc value.

b) Revaluation should be done uniformly every year to arrive at fair value.

c) For depreciation Para 13 of AS-10 dealing with depreciation accounting, the rates should be at prescribed rates unless circumstances warrant higher rates. In any case, lower rate than pre-scribed rate cannot be adopted.

d) Para-16 of AS-10 (revised) describes depreciation as a systematic allocation of cost over useful life. Components, having different useful life, should be depreciated at different rates. The rate and depreciation should be reviewed every year in the light of information about useful life.

e) Method of depreciation should also be reviewed every year. When there is a change in rate, it is change in estimate and not change in accounting policy. When method is changed from SLM to WDV, it is change in accounting policy. For this the change should be prospective.

f) In the past when asset is revalued the book value goes up. Additional depreciation due to revaluation should be adjusted by withdrawing such differential amount from revaluation reserve. However, in Revised Standard, depreciation on revalued asset will appear in profit and loss account – Now withdrawal from revaluation reserve will not be permitted.

III. AS-ll (Revised) Accounting of changes in foreign exchange rates:

This Standard was originally passed in 1993. It was revised in 2003 and made effective from 1-4-2004. In earlier Standard it was provided that increase in liability for repayment of unpaid price of fixed assets like plant and machinery had to be capitalised. A view was taken while finalising the Revised Standard that such change is a finance charge and credit or debit should be taken to profit and loss account. However, as Schedule VI needed capitalisation, the Institute announced that Schedule VI will prevail over Revised Standard i.e., Capitalisation was approved.

Now, this position is again changed. In respect of accounting year commencing on or after 7-12-2006, the Companies Accounting Standard Rules are coming into play. While Government agreeing with the Institute’s views re: finance charge has put a note to Accounting Standard Rules that in spite of Schedule VI, such exchange difference can be taken to profit & loss account. On 17-7-2007 the Institute issued pronouncement that the note to A. S. Rules should be given effect in respect of capitalisation, made between 2004 to 2007. For assets acquired between 1993 to 2003, the position will not be disturbed. Between 1-4-2004 to 6-12-2006, Schedule VI protection is still available. A legal view is taken that since Schedule VI is part of the Companies Act, it will prevail over Rules in spite of the view taken by the Government and the Institute.

IV. AS-15 –    Retirement Benefits    for Employees:

The Standard was originally issued in 1993 and revised in 200S. The new Standard covers entire gamut of benefits except share-based benefits. This was originally to become effective from 1-4-2006 which date is postponed to the year commencing after 7-12-2006. The issues are:

The liability accrues at the point when the service is rendered and not at the time of payment. The Institute has issued FAQs containing 18 questions and replies thereto. This Standard applies when employer-employee relation subsists.

i) In case of gratuity which becomes payable only after completion of five years still provision has to be made for the liability accruing each year. The liability is to be quantified by actuarial valuation.

ii) Leave encashment is also required to be provided. Maximum accumulation is 240 days whereas availment each year is 30 days. In such case the actuary should evaluate the liability.

iii) As regards P.P. contribution by employer the liability is determined, but as regard gratuity it is to be evaluated.

iv) In revised Accounting Standard AS-IS, the matter is not left entirely to actuary. It now provides that liability to be ascertained by applying Projected Unit Credit method (PUC).

v) As regards VRS benefit, the amount paid is amortised over five years. But the new Standard provides that it is an expenditure of current year and cannot be deferred, because it is not an asset. VRS paid up to 31-3-2009can be amortised, but payments thereafter cannot be amortised but to be wholly debited to profit and loss account, so also earlier year’s amortisation cannot be carried beyond 1-4-2010.

vi) Where earlier year’s liability is sought to be provided for the first time, the prior year’s liability can be debited to revenue reserves or another option of amortisation over five years is given by revised AS-IS. However, such treatment should be reported by way of note as information or disclosure and not as qualification to true and fair view.

 v) Derivative Instruments Accounting and Institutes Views:

i) The Institute’s announcement dated 28-3-2008 on issues is applicable for accounting year ended 31-3-2008.

Derivative instruments being financial instruments are covered by Accounting Standard-30 which will be applicable from 1-4-2011. Till then it is recommendatory. The foreign exchange derivative contracts as well as other derivative contracts put the company to huge liabilities. Derivative contracts comprise of index, exchange and commodity derivatives. Though AS-30 is not put in operation, still AS-1 is applicable insofar as concept of prudence, for providing for losses.

ii) Where there is profit in some and losses in other derivatives, whether provision should be made contractwise or classwise or on global basis. The global treatment is certainly not correct. The categorywise treatment is recommended. If net is a loss it should be provided, if net is gain the same is to be ignored.

iii) Hedging transactions – if in underlying contract of purchase/sale there is a loss and in derivative contract there is a gain, then both are to be netted.

(iv) If there are derivative contracts covered by AS-11, Paras 36 and 37 talk about hedging, whereas Paras 38 and 39 talk about derivatives speculation and trading. If on 31st March the position shows a loss, but on subsequent Balance Sheet date, there is a gain, such subsequent event accruing in next year cannot be taken into accounts.

The meeting was terminated with a vote of thanks to the speaker.

Royalties and Fees for Technical Services in International Trade

Lecture Meeting

Subject : Royalties and Fees for Technical Services in
International Trade.



Speaker : Pinakin D. Desai, Chartered
Accountant, Past President, BCA.


Venue : Walchand Hirachand Hall, IMC.



Date : 7th May 2008








(1) Scope and coverage of the subject :



The learned speaker first set out the scope and coverage of
the subject he will be dealing with. He clarified that he would not be dealing
with situations where such incomes are received by resident assesses, but he
would consider situations where the resident assessee is effecting the payments
to a non-resident individual firm or company, since obligation to withhold tax
will arise only with reference to such payments. A resident payer has to put a
question to himself whether the non-resident has a liability to pay tax in India
on royalty or on fees for technical services (FTS) received by him from a
resident company. It is only then that he becomes liable to withhold tax.

(2) Fundamental Rules :


(a) Normally a person is liable to pay tax on his income in a
country in which he is resident. However, there are exceptions to this rule
e.g., A U.K. company though liable to tax in its own country on income
received in India, all the same, tax laws in India may fix a liability on such
company to pay tax in India on Income accruing, arising or received in India. In
such case a simultaneous obligation is cast on an Indian payer to withhold tax
on such payment to the U.K. company.

(b) Where a non-resident is having a business connection or
permanent establishment in a source country, say, India, then such non-resident
is liable to pay tax on income from business connection or from permanent
establishment.

(c) In respect of royalty or technical services, the
liability to Indian Tax arises even if the services are rendered outside India.
In such cases, one has to look to provisions of treaty under D.T.A. Agreement.
If the tax is payable in source country under the treaty as well as under
domestic law, then withholding at prescribed rate will have to be made. In
another circumstance where tax is payable under domestic law but not under the
treaty, or conversely tax is payable under the treaty but not under domestic
law, or where the tax is required to be paid at lower rate, then such
non-resident recipient company can make payment in each case, at a rate most
beneficial to him.

(d) Tests to be applied to applicability of treaty
provisions : It is advisable to read all provisions of the treaty since
prima facie impression about non-taxability may get negatived by some other
provisions in the treaty. To illustrate, in the India-U.A.E. treaty the articles
are saddled with a number of barriers and conditions.

(e) Concept of beneficial ownership : Concessional or
beneficial treatment is allowable, provided the recipient is the beneficial
owner of that income. Where such recipient acts only as a conduit between the
payer and the actual beneficial owner, then benefit of concession gets lost. In
Nat West case the AAR held that the company in Mauritius is only an intermediate
vehicle between the payer and the real beneficial owner. Hence, it will not get
exemption.

(3) Fees for technical services : Applicable provisions :


(a) Domestic Law : When an Indian company makes
payment of fees for technical services, then per S. 9(1) (vii) tax is leviable
regardless of situs and nature of services; whether managerial, technical or
consultancy service. All these are regarded as technical services and there is
tax withholding obligation. Technical service means a service requiring
application of required skill and knowledge of service provider. It does not
include a normal or routine commercial service; like that of an agent promoting
sales outside India of products of his principal in India. Hence, determination
of exact nature assumes importance. There are three concepts :

(i) Whether payment is for a product or a service. Where a
readymade product is acquired, there is no element of service. But when such
product is customised or tailor-made according to requirement of customer, it
involves supply of service.

(ii) Whether it is a service from equipment or whether it
is payment for user of equipment. To illustrate, where rent is paid for use of
car or house, it is payment for use of that asset. But, where the payment is
to hotel for boarding and lodging, it is a service, so also use of taxi with
driver or payment for rail or air-travel fare. In these cases use of equipment
is incidental to use of service.

(iii) Technical service v. technology-driven
service : Examples :

(a) Live telecast music event : Though this
involves use of highly sophisticated equipments, the user is in fact
interested in the product that is entertainment programmes. So also on-line
game on portal or Internet service or on-line tax information provider’s
services. All these services are technology-driven services and not
technical services.

(b) Physical service v. electronic service. Due to
development of electronics, one can instead of purchasing a book from shop
or purchasing rail or air ticket on counter can avail the same from website
or by e-booking. All the same, the nature of service remains
technologically-driven service.

(c) In recent decision of the Mumbai High Court in
Diamond Co. case reported in 169 Taxman, the Hon. Court has analysed the
concepts of technology-driven services, royalty and fees for included
services. The company was engaged in services of grading the diamonds
involving specialised knowledge of gemologists. After applying various
tests, the certificate of gradation was given. This was regarded as
technologically-driven service.



(4) Different facets of technical service :


The Supreme Court in Ishikawa jima-Harima Heavy Industries Ltd. reported in 288 ITR 409 (SC) has held that the liability to pay tax under domestic law arises only when there is a live connection or a live territorial nexus between the service and the place where services are rendered. This is a prime condition before applying S. 9(i)(vii), as the said Section itself provides that when an Indian company has availed of any technical service from non-resident in respect of source of income outside India then such payment will not be regarded as accruing in India, since such payment is for earning income from source outside India. The explanation to S. 9(i) (vii) provides a protection in this respect. If a UK company has undertaken a turnkey project or construction project  in India,  the project  is located in India and technical services are provided by the UK company, then such services will be regarded as part and parcel of project and the same will be regarded as project executed by the UK company. The income from execution will be taxed in India. The UK company will be deemed to be having permanent establishment in India.

(5)    In many treaties there is not only Article on fees for technical service, but also Article on Independent Personal Service (IPS) say professional service. If in a treaty there is no Article dealing with Fees for Technical Services (FTS),but there is Article on Independent Personal Service, such Article can make a Brazil company liable to domestic tax, if it receives fees from an Indian company, even if there is no fixed base or PE in India.

(6)    Where a payment  is taxable under  one article of treaty, but not under another article of the same treaty, the foreign enterprise may follow beneficial rule.

(7) Fees for Induded    Service    (FIS) :

This primarily deals with technical service, but its coverage is narrower than fees for technical service (FTS) and is akin to S. 9(i)(vii). Under this Article, tax will be payable by a Brazilian company in India on technical services received from Indian company even though services are not performed in India and it has no PE in India.

A treaty may have two sets of Articles, one dealing with FTS and other with IPS applicable to individual or firm. In a situation where fees for technical services are taxable in India and also under Article with FTS, but not taxable under Article IPS since such FE is not having PE, then FE can follow beneficial rule whereby IPS article will override FTS Article.

(8) Fees for Induded    Service    (PIS) :

It primarily is applicable to FTS. A technical service becomes included service in circumstances where the person giving service makes available technical knowledge, experience, skill, know-how or process or in addition to service makes available or transfers plan or technical design. The plans of architects or designs for installation and maintenance of machinery are illustrations, which are handed over to the payer of consideration. Similarly, software developed by a technician programmer makes available the software to his customer is another instance of included service.

Where a right to use a patent is acquired by an Indian company and if before effectively putting it to use, in conjunction with it his existing process set-up, and if there is a need for modification which is also provided by FE, then this additional service can be termed as included service. The tax will be payable at the time of making payment as per Article 12(4)(a).

(9)    Most-Favoured Nation Clause (MFN Clause) :

Though  on plain  reading of treaty  tax is payable, still there may be certain Articles whereby tax may not become payable, where there is MFN protocol. This clause is generally provided at the insistence of enterprise providing the service to ensure continued patronage of service receiver. However, the receiving company can provide for its freedom to enter into contract with some other service provider in future, whereby present contract will stand modified.

(10) Procurement of designs:

Where intention of receiving enterprise is to buy a product or a customised design and not standard design,  the judicial  views  are divided.

In Abhishek Developers v. ITO, 3719-3722/B/04 (Bang.) and in Indian Hotels Co. Ltd. v. ITO, ITA No. SS3/M/2000 (Mum.), the customised designs were considered as products. As against this, in MRPL v. DCIT, (ITA No. 1826/M/04). In Centex Merchants Pvt. Ltd. v. DCIT, (94 ITD 211 Cal.) and in TAG Report of OECD such supply was treated as technical service.

In all these contracts intent or object behind availing service needs to be looked into. Is the object to buy a service or to buy a product? There can also be a mixed contract. S. USA taxes it at 10% plus Sch. If technical service is connected with a PE, then S. 44D becomes applicable and tax will be 40% plus Sch. after deducting expenses of the P.E. i.e., on net income. The IDS will still be at 10% even if receipt by FE is effectively connected with FE’s PE. One has to keep in view the probable litigation on application of S. 40(a)(i).

(11) Royalties:

This covers payment of royalties for branded products, payment for use of LP.R.s (Intellectual Property Rights).

Traditional view is, when use of intellectual property rights is made available for commercial exploitation, the consideration received is Royalty. Similarly providing use of confidential basis of information or right which is not in public domain gives rise to royalty.

Key question to be asked by recipient of consideration is what does the payer of consideration get in return for such payment, Does he get use of IPR ?

(12) Inherent features of IPR Grants:

(a)    IPR is the result of owner’s skill, effort, exertion, intellect and/ or suffering.

(b)    Owners possession usually constitutes his tool of trade.

(c)    IPR’s are not in public domain, but are possessed secretly.

(d)    Such IPRs mayor may not be registered or protected.

(e)    Grantee is permitted to do what otherwise may be infringement.

(f)    Grantee is enabled to do what owner could have done.

(g)    Grantee  can commercialise  the product.

(13)    Illustrative  rights  of copyright  holder:

(a)    Literary work is protected by the Indian Copyright Act (ICA)

(b)    Literary work includes computer programme [So2(0) of the Indian Copy-right Act (ICA)]

(c)    Exclusive rights of copyright holder are described in S. 14 of LCA. and they are,

(i)  To reproduce work

(ii)    To issue copies  to public

(iii)    To make  translation

(iv)    To make  adaptation

(v)    To sell or offer for sale.

(14)    The learned speaker then illustrated and displayed a chart illustrating the exact nature of receipts in the hands of grantor & grantee of licence, is Product v. Underlying IPR.

Apprehended confusion ….Product v. Underlying  IPR:



(15) Definition of Royalty – Expl. 2 to S. 9(i)(vi) :

This is to be viewed from point of view of payer When payer gets any of the following rights, then it is payment of royalty.Where payer is getting any right for use any patent, invention, secret formula or secret process or similar property or for use of any copyright of any scientific, literary, artistic book, (It covers music drama, software or IPR) then such payment is royalty.

(16) There are subtle differences in definition, scope of royalty including exceptions under the Income-tax Act and the definition under UN Model. The speaker elucidated those differences through display of studies. The same are as follows :

As per Explanation Z’to S. 9(1)(vi) the royalty takes in its fold consideration received for

(a) any transfer of all or any right (including the granting of a licence in respect of films or video tapes for telecast or radio broadcasting)

(b) transfer of any right to use equipment

(c) disclosure of any knowledge, experience or skill on technical, industrial, commercial matter popularly known as undivulged know-how;

Exceptions : The following is not covered
(a) Payment is for business or source of income outside India.
(b) Consideration for sale, distribution or exhibition of cinematographic films.
(c) Capital gain income from sale, transfer of IPR.

(17) U.N. Model definition:
Definition of royalties per S. 9(I)(vi) is very wide. Treaty definitions normally are more beneficial under U.N. Model, definition of royalty:
The term ‘royalties’ as used in this Article means payment of any kind received as a consideration for the use of or right to use, any copyright of literary, artistic or scientific work including cinematograph films, any patents trademark, design or model, plan, secret formula or process or for the use of or right to use industrial, commercial or scientific equipment or for information concerning industrial, commercial or scientific experience. Therefore what is not royalty is business income taxable in the country of residence.

(18) Judicial development in taxation of royalty:
(a) Asian Satellite Decision: In this case, payment was made for use of service from equipment service provider who had server and equipment at his disposal, satellite transponder was used. The payment received from such user, whether a royalty ? According to the assessee he was using only a commercial service, but per Dept. it was payment for use of process since the words in S. 9(i)(vi)are use of secret formula or process. Per the Tribunal, a formula may be secret, but process need not be secret. By use of process, the data becomes available to user, hence it is covered by term royalty. The other cases are of Grindwel Ltd. & Kotak Mahindra, holding that use of server, the consideration par-takes colour of royalty. According to speaker, these decisions require reconsideration.

(19) Equipment hire  v. Service:

As definition of royalty includes consideration for use of or right to use industrial, commercial or scientific equipment, the user has to ask two questions to himself, namely:

(a)    Am I requiring  the use of equipment,  or

(b)    Am I acquiring  service  of the equipment?

In the former case he needs physical possession, custody and control of property. There should be no concurrent user by other and thirdly the risk of operation  is with  him  as user.

In the latter case, treaties  are not uniform  e.g., the India-USA DTAA covers equipment rental also. But in India-Netherlands DTAA, it does not. Impact of MFN clause. In Belgium treaty, the scope was amended due to favourable treaty with Sweden.

(20) TDS compliance:

TDS compliance  assures  great  importance  due  to rigours  of S. 40(a)(i). It is advisable  to take certificate u/s.  195(2) to overcome  chances  of disallowance  of expense  and  also  to avoid  litigation  on failure  to deduct,  confrontation   on interest  and penalty  for non-deduction   and  paying  tax out of own pocket. The assessee payer has no authority  to decide whether  tax is deductible  or not. It is advisable to follow safer course  of withholding  tax before payment to non-resident.

The meeting terminated with a vote of thanks to the learned speaker.

Recent Global Developments in International Financial Reporting Standards

 Subject : Recent Global Developments in International Financial Reporting Standards

Venue : IMC Hall, Churchgate, Mumbai

Speaker : N. P. Sarda, CA, Past President, ICAI

Date : 25th November, 2009

1. Bird’s-eye view of Development of International Accounting Standards from inception to date :

    1.1 In 1973, Accounting Standards Committee was formed to propose International Accounting Standards. In 2001, the name of the committee was changed to International Accounting Standard Board and the standards that were prescribed by the Board were titled as International Accounting Standards (IAS). The Accounting Standards hitherto published will be merged with IFRS. In the course of time, new standards may be formulated which will get added. Under the old regime of IAS, forty-one International Accounting Standards were introduced, out of which 12 standards were withdrawn or superseded by new standards, leaving twenty-nine International Accounting Standards. There are nine IFRS already in existence. The 9th IFRS has been issued on 12th November 2009.

    1.2 So far, several interpretations were issued on International Accounting Standards (IAS). Henceforth, interpretations on new Standards (IFRS) will be included in literature on IFRS.

2. The global developments, their present status and issues embedded therein :

    2.1 In India in 1987, decision was taken to set up at our Institute’s level an Accounting Standard Board. After its formation, it was decided to formulate our own independent Accounting Standards (AS), rather than verbatim adopting their international counterpart. Subsequently, in 2007, it was decided to convert present Indian standards to IFRS.

    2.2 In 1997, it was decided to achieve comparability and to improve existing standards. It was decided to revise ten Accounting Standards, such as AS-2 Valuation of inventory, AS-7 Accounting for construction contracts, etc.

    2.3 In 2003, another improvement project was undertaken by International Accounting Standard Board of revising fourteen Accounting Standards.

    2.4 There exist three types of Accounting Standards, viz. US GAAP evolved by US, International Accounting Standards and National Accounting Standards of each country. US GAAP was competing with International Accounting Standards. On many issues. However, it was decided to co-ordinate and close down the differences by taking up long term/short-term projects in that direction.

    2.5 There is one fundamental difference between US GAAP and International Financial Reporting Standars, namely, US GAAP lays down the rules, whereas IFRS sets out the principles.

    2.6 On 15th November, 2007 a decision was taken that companies located outside the US can follow principles of IFRS which need not be reconciled with US GAAP. But, if any company has to enter US capital market, then it must reconcile its accounts with US GAAP requirement.

    2.7 The European Union with its twenty-seven member countries and their respective parliaments decided that consolidated financial statements of listed companies should be as per IFRS. As regards unlisted companies or stand-alone units like holding companies and their subsidiaries it was left to discretion of member states. The trend of thinking of these governments is to make IFRS mandatory even to unlisted companies and stand-alone accounts. Thus, there are three-tier arrangements presently existing for dealing with presentations, disclosure requirements and the rules applicable to listed companies and stand-alone companies.

    2.8 Pursuant to this decision, the UK Parliament has passed legislation that all listed companies and even stand-alone companies will have to prepare consolidated account statements as per IFRS principles. For unlisted companies, IFRS applicable to SME i.e., Small & Medium Enterprises sector will be used and for very small enterprises (Micro Units) another standard as prescribed will be used. Similarly, for companies in the US, there are three-tier arrangements for presentation and consolidation.

3. IFRS for SMEs :

    3.1 The printed materials by way of Accounting Standards, Interpretation iterature in case of US GAPP runs into 17,000 pages and in case of IFRS, this runs into 2,500 pages. For small and medium sector companies, IFRS printed material is only 250 pages which, such SMEs will have to follow.

    3.2 In Europe, all the 27 member countries took a decision to totally adopt and follow IFRS and parliament passed suitable legislations accepting IFRS.

    3.3 Countries like Australia, New Zealand, Korea, and Sri Lanka have adopted IFRS, subject to their right to exercise their option about additional disclosures.

    3.4 A need to have a second look at the disclosure requirements of IFRS is being felt. A project called project on evaluation of disclosures is being undertaken to avoid conflict between IFRS requirements about disclosures, local requirements and economic situation in India. A decision is taken keeping in mind the strong view taken by IFRS that though guidance note can be provided, it should not conflict with principles pronounced in IFRS. Such guidance notes will not form part of the standards prevailing in the country. The IFRS Board is very assertive on this point. This makes it a difficult task to convert Indian Standards into IFRS with narrow scope for variation. In Europe, its twenty-seven member countries as well as countries in rest of the world have decided to go nearer to IFRS, but at the same time, retaining their right to deviate if local situations so demand. Though many changes are not permitted, the countries can decide about the dates/years from which the new standards will become applicable. So, many countries have decided to go for modified standards which will be close to IFRS instead of adopting IFRS directly.

    3.5 The regulators of Accounting Standards in India hold the same view. The Ministry of Corporate Affairs, SEBI, RBI, IRDA & ICAI are unanimous on issuing Indian Standards and not to endorse IFRS directly.

3.6 Global situation : The countries in Europe, Australia, New Zealand made their own standards. The countries like Korea, Sri Lanka, Hong Kong followed the IFRS verbatim. But, Singapore and Philippines accepted some of the standards and dis-agreed with some others. For example Interpretation Note No. 2 & 15 were not accepted by Singapore. Obviously, they cannot certify IFRS compliance. Some countries like India have made new standards applicable from 2011. So also Pakistan, Indonesia, Taiwan, Vietnam are trying to go nearer to IFRS in next four years. China has prepared thirty-eight Accounting Standards, which are at par with IFRS.

4. Issues and controversies arising from IFRS :

4.1 Recent global development and the financial crisis : In the last two years, a lot of debate has generated on whether crisis is due to accounting failure or due to some other reasons. The final view is that the crisis is attributable to failure of economic system. Banks were advancing loans on mortgage of properties. Attention was given only to value of property and not to repayment capacity and integrity of borrower. This practice worked well till property prices were rising. But this over-optimism brought about the disaster when property prices started dwindling. The borrowers opted to surrender properties, overflowing the banks’ balance sheets with properties in place of recoverable loans. In India, however, due to proper monitoring by RBI about secured loans against mortgage, restricting the discretion of banks on the extent to which such loans can be given, the disaster could be avoided to some extent.

4.2 Another reason for the economic crisis was that in India, the bankers not only look into the sufficiency of security but also verify integrity of bor-rower. But in the USA the scenario was that when loans were transferred to another bank, the portfolio of investments held as security were also transferred as financial products. The insurance companies gave guarantee. But when portfolio became bad, the recovery of debt became doubtful. The financial products, valuation of which is complex, when transferred to other bank, no conservative principles were followed. So also, when loans were given against property, the erosion in value of property resulted in losses to lender institutions. In the process of finding solution, it was decided that the standard-setters of financial reports should come out with new standards. As financial products are complex for evaluation, the standard-setters should give guidance on principle to be followed for financial instruments. IAS-39 is proposed to be revised by issuing IFRS-9. Another reason for the crisis was that many companies are having financial commitments which remain outside the books and do not get reflected in balance sheets. To illustrate, companies enter into Derivative contracts, the profit or loss gets crystallised when contracts are settled or options are exercised at future dates. Some companies enter into forward contracts for covering foreign exchange risk pertaining to purchase/import of raw materials. The fluctuations in import prices are very high. So, very often companies suffer heavily on actual settlements of contracts entered into, say, before 12 or 24 months. Such obligations do not get reflected in the accounts. This is a lacuna. In March, 2008, the Institute came out with Notification about derivative instrument in AS-30 which is not yet made mandatory, but recommendatory. Still, if a company desirous of following it, keeping in mind concept of prudence as per AS-1, can make suitable provision for losses that are likely to arise in derivatives, forward contracts and make account statements transparent and realistic. The financial failures of business enterprises due to such contracts of derivatives also have contributed to economic crisis.

4.3 As a step in the direction of solution, Financial Advisory Board was appointed by International Accounting Standard Board. US Financial Advisory Board is advised to study the situation and submit its report and recommendations.

4.4 The Board has observed that failure of the economy is not due to erroneous accounting but due to inherent system failure in incorporating liabilities and losses arising from derivatives, forward contracts, credit policies of granting loans against properties and financial instruments. It also recommended simplification of Accounting Standards on Financial Instruments (IAS-39) by issue of guidance note. International Accounting Standard Board took review of IAS-39. The issues arising therefrom touching subjects of presentation, disclosures were incorporated in IAS-32 issued in 1995. The other complex issues like recognition, measurement and valuation and other difficult issues were taken up in 1999, which were incorporated in IAS-39. For presentation and disclosures, IFRS-7 was issued. Now the AS-32 will contain only disclosure requirements. Some radical changes were made in basic concepts in accounting hitherto followed. For example, in IFRS, redeemable preference shares are not treated as capital or shareholders’ funds. It is a liability and not equity. Similarly, for IFRS, fully convertible debentures are considered as equity and not liability. Hence, when AS-32 will become effective, Schedule VI of the Companies Act will have to be revised. For IFRS, substance is more important than form. Therefore, for giving effect to IFRS, changes will have to be made in Financial Instruments Standard by simplifying it. These changes will be necessary in IAS-32 on financial instruments and in IFRS-7 on disclosures. The impact of financial instruments of liabilities arising through forward contracts, derivatives and other liabilities not appearing in balance sheet, age analysis of credit risks, portfolio valuation based on rate of interest. All present disclosures in standards on fixed assets and inventory does not cover issues arising in financial instruments.

The applicable standards are :

IAS-32 for Presentation

IAS-39 on Recognition Measurement and Valuation

IRRS-7 on Disclosures

4.5 IAS-39 on Recognition, Measurement and Valuation is being discussed globally on simplification. In India, on this issue AS-30, AS-31 & AS-32 are introduced; AS-30 deals with Recognition and Measurement. AS-31 is on Presentation and AS-32 is on Disclosure. The contents of these standards are at par with corresponding International Standards, but they are yet to be made effective. A project is undertaken in three parts by International Accounting Standards Board.

4.6 In the first part, issues on recognition, measurement and valuation are dealt with.

In the second part, impairment of investment and in third part, issues on hedging will be dealt with.

The first part is completed on 12th November, 2009 called IFRS-9. The second and third part will be completed in last quarter of 2010.

5. Classification, recognition & valuation of financial instruments :

5.1 There are four categories — Financial instruments include investments, loans and advances, deriva-tives and other financial assets and on liability side it includes every debt and equity other than current liability. The principles of valuation in IFRS-39 require adoption of fair value and not market value. So, if the inflow of actual yield of interest and amount due on maturity is known, then the fair value will have to be arrived at. To illustrate, investment of Rs.100 is purchased at Rs.91 which on maturity after 3 years will fetch Rs.100 and in inter-mediary years, it is fetching interest @ 7% and market value is, say, Rs.95. For fair value, one has to find out discounted value. In this case, the inflow will be @ 7% for 3 years and Rs.100. On maturity. after three years, suppose, discounted value is Rs.97, then for IFRS, the historical cost of Rs.91 as well as market value of Rs.95 is not relevant but discounted value Rs.97 will have to be adopted. This method of valuation is called amortised cost method. There are two methods in IFRS either amortised cost or fair value. This method can be followed if inflow is known and certain. The present value of such inflow is considered.

5.2 In IFRS-9, there are three methods of classification. First is fair value and second is amortised cost or discounted cost. Third is loans and advances to be valued at amortised value. To illustrate, if the loan of Rs.10 crores is given on security of property of Rs.8 crores and recovery is not likely, then under IFRS, for valuing security offered, the time that will be required for realisation of security will be taken into account. If the time for realisation is, say, 3 years, then discounted value of security of Rs.8 crores will be considered at say Rs. 5.50 crores. The difference between loan of 10 crores and present worth of securities i.e., Rs. 4.50 crores will be charged to Profit & Loss account by way of provision for bad and doubtful debt. The value of secured advance will appear at Rs. 5.50 and not Rs.8 crores for IFRS and the advance will become performing asset for presentation in balance sheet. So, the time value of money plays an important role in IFRS.

5.3 In IFRS-4, the following principles are extremely important. They are :

1. Historical costs do not play any role. It is always the present worth or discounted value, because user of financial statements is not interested in historical cost but present worth or fair value. For arriving at fair value, allowance is to be given to discounted value.

2. Time value of money : If the asset subjected to valuation carries normal interest which is realisable, then no discounting is necessary. But where no interest is likely to be received, then the value of asset needs discounting.

3. Substance over form : This is illustrated by a hypothetical case. If a company has declared VRS for its employees giving certain time allowance to opt, the company expects that, say 10 employees will accept retirement. But, actually, say, only 3 employees have opted and the company accepted their retirement. Then, as per IFRS, the provision for liability should not be only for three employees, but for all the likely employees, since the liability exists on balance sheet date. Such liability can be discounted. So, though legal obligation has not arisen, the constructive obligation requires consideration under IFRS.

In case of holding and subsidiary companies, for deciding whether consolidation will be required, the company will have to consider effect of the powers vested in holding company. If company ‘A’ is holding 49% of shares of company ‘B’ and under a contract or a MOU, the right to appoint managing director and finance director is vested in company ‘A’, then though holding is less than 50%, still the company ‘A’ holds right to decide effective financial management of the company ‘B’. Hence, consolidation of both Balance Sheets will become necessary. The same situation will prevail if majority of directors can be appointed by the company ‘A’. So, lead control test is satisfied. Thus, in IFRS substance over the form requires consideration.

4. For IFRS, the balance sheet plays more important role. Normally, the Profit & Loss account is considered important, since it decides profit for the year, the tax liability, the quantum of staff bonus, the dividend policy and other effects. In IFRS, balance sheet is supreme, since user of financial statements is more concerned with real state of affairs of the company. He needs an assurance that all provisions are made for actual or constructive liabilities and assets are valued not by historical cost but at fair value by making provision for impairment. At the same time, extra prudence through excessive provisions should not harm the interest of existing shareholders. The balance be-tween interests of existing and prospective shareholders is expected to be maintained. IFRS-9 will become mandatory from the year 2012.

6. Difference between IAS-39 and IFRS-9 :

6.1 Instead of the above four categories of principles in IAS-39, the fourth terminology for categorisation of shares and securities, is securities available for sale. Where securities cannot be termed as trade investments or long-term investments or other investments, then the same can be categorised under the head ‘Securities available for sale’. If value of such investments have materially appreciated, then the difference can be recognised by considering investment at fair value or realisable value and crediting other comprehensive income which shown in the balance sheet under ‘Reserves’.

6.2 In IFRS-9 instead of four methods only two methods are suggested, namely, fair value and amortised cost or discounted value of future proceeds. The intention for making investment will decide its category. Considering practical difficulties in determining fair value, International Accounting Standards Board, in its exposure draft has provided guidance on measurement of fair value. If there is active market for investments, then such value or in absence of active market, there is an alternative formula in finding out fair value. First level is evidence of trend of active market, second level is comparison of your security with similar security in active market. The third level is to consider cost of investment as surrogate of fair value.

6.3 When security is intended to be held till maturity and its amortised cost is considered, the variations in market value will have no effect on value, since it is to be held till maturity. But, if any of such securities are disposed of before maturity, still as per IFRS-9, revaluation need not be carried out. In IAS-39 on valuation of investment there were different rules to deal with appreciation and depreciation. In IFRS-9, these rules are substituted by simple principles viz., the impairment is to be identified with specific investments.

6.4 As regards valuation of equity shares, the principle in IAS-39 deals with embedded derivatives. In derivative contracts, what a party can receive or pay depends on price of commodity, rate of inflation or rate of exchange or rate of interest. An embedded derivatives are still complex. If asset is given on lease and if the rent is made depend on say rate of inflation say if inflation goes up by 1% the rent will go up by say 20%. This is contract of embedded derivative where outcome cannot be preciously determined. IFRS-9 covers only financial assets and not financial liabilities. Impairment of holding are to be considered later.

7. The present status of IFRS-9 & IAS-39 applicable to India :

7.1 The concerned authorities in India are ICAI, Ministry of Corporate Affairs, SEBI, RBI, Insurance Authority and the companies. The issues to be tack-led are — whether IFRS is to be adopted in total in the same form whereby Indian standards will cease to exist.

7.2 The trend of thinking of the above authorities is that IFRS can be applied only to public interest entities and Indian Standards will continue to apply to other entities.

7.3 Public interest entities need to be defined. It will include top listed companies or corporations, which have borrowed abroad or companies having subsidiaries abroad or have issued equities abroad. Therefore, IFRS will be applicable from 1-4-2011 to Insurance, Banking and Financial Institutions.

7.4 From 1-4-2013, the IFRS will be applicable to category 2 companies which will include all listed companies or companies having turnover over Rs.2,000 crores or borrowing more than Rs.500 crores.

7.5 For all the rest of companies, the question is whether they should follow existing AS or IFRS. These categories are SME’s (Small & Medium Enterprises), which are not equipped with advanced knowledge, required for IFRS. They can follow simpler accounting standards in India and progressively be prepared to follow IFRS by knowing its under-lying principles. A change in their mindsets and taking steps towards appreciating differences between Indian Standards and IFRS is the need of the day.

The learned speaker thereafter replied the questions raised from audience and concluded his speech.

The meeting was terminated with vote of thanks to the speaker.

to sense it and stub it.

  •  that the pro-active action the Chairman, prevented a brewing crisis in human relations which would have adversely impacted the company’s operations.

  •  the importance of HR policies and timely action.

  •  that HRD keeps its finger on the ‘pulse’ of the organisation.

Survey — Legal, Tax and Accounting Aspects

Lecture Meeting

Subject : Survey — Legal, Tax and Accounting Aspects



Speaker : Dilip Lakhani, Chartered Accountant


Past President, BCAS


Venue : I.M.C. Hall, Churchgate, Mumbai.



Date : 26th November 2008


1. Introduction :



At the outset while identifying the reasons prompting the Tax
Department to conduct a survey is that though theoretically every assessee has
to pay tax on income he actually earns, in actual practice the assessee pays tax
only on the income he discloses. Very often, the gap between the two is found to
be mordantly large, resulting in generation of undisclosed income and
undisclosed wealth. To counteract this practice, the Legislature has given wide
powers to tax authorities to conduct surveys and search proceedings. Though
these provisions are legally valid, controversies arise in their implementation.
It also gives rise to many issues in accounting the differential incomes
disclosed at the conclusion of the survey or search.

2. Search (S. 132) and survey [S. 133(A)]

— comparative study :

Though repercussions of Search are more drastic, the Survey
provisions, according to the speaker are more risky for the following reasons :

The first reason is that a warrant for search needs approval
of the highest administrative authority,
namely, Director General of Investigation (a rank equal to Chief Commissioner)
who issues the warrant only after careful and in-depth study of all relevant
facts, circumstances and background of the case.

Another safeguard is that before coming to the decision of
taking search of any assessee, care is taken to ensure that the assessee’s case
satisfies at least one of the three basic conditions. The authority must record
the reason to believe that the assessee is understating his income. He has to
spell out why the search is to be conducted and what is the information
available for conducting the Search.

This process of collection of data to arrive at this
satisfaction takes two to three months. It is only after such satisfaction that
the Director General of Investigation issues a warrant.

As compared to this, S. 133A does not contain similar
preconditions of satisfaction. It provides that the Income-tax authorities may
visit the place of business of the assessee to carry out the Survey. It can take
place if there is fall in turnover, fall in G.P. ratio or non-compliance by the
assessee during assessment proceeding. The only condition is to get approval of
the Additional Commissioner of Income-tax.

3. Analysis of legal, accounting and tax aspect of survey proceedings :


Survey connotes comprehensive inspection of place of business
or profession. A survey cannot be conducted at place of residence. The survey
party can inspect the books of accounts, documents, take inventory of stock,
cash, valuables, investments, all of which thereafter will be inventorised.

After 1-6-2002, survey party is given power to impound books
of accounts and documents and take custody of the same after inventorisation. No
other asset can be impounded.

Normally survey cannot be conducted at residence, since it is
not a place of business. If in the return of income it is shown as any other
place of business, then the survey can be conducted at residence as well as in
any other place of business, say, godown or branch or additional place.

4. Timing for commencement of proceedings :


As regards timing to commence Survey, the same should be
within normal business hours. Once proceedings start, the same can continue till
it is concluded i.e., even beyond hours of business. The Search
proceedings should commence only between sunrise and sunset.

5. Places that can be covered under survey proceedings :


Where the assessee states that his books of accounts are with
his C.A. or Advocate, then the survey can be conducted even in office of the
C.A. or Advocate. However, In 1994, the CBDT issued a Circular stating that
normally Survey should not be conducted in office of C.A., but he should be
asked to produce those books at the place of business of his client who is being
surveyed. If the C.A. refuses to co-operate, then the office of the C.A. can be
surveyed. But the scope of survey will have to be restricted to the books and
other documents of that particular client only and not to books, etc. of C.A.
himself or his other clients.

6. Authorities who can conduct the survey proceedings :


The Income-tax authorities defined in explanation to S. 133
are Commissioner, Asst. Commissioner, Income-tax officer and Inspector, so also
officers of investigation wing i.e., Asst. Director, Director of
Investigation, Deputy Director of Investigation, Additional Director of
Investigation and Inspector. But Chief Commissioner and Director of
Investigation cannot conduct survey. The reason is they are senior officers.

7. Rights conferred on the Officers :


The rights of officers in survey party include right to enter
premises and verify whatever is available in the premises. But the officers
cannot take personal search. The officers in such cases ask the assessee and
others present to empty their pockets and place the papers, documents before the
officers’ table which can then be inspected. It is important to note that though
inspector is an authority in search party, his powers are very limited viz.
to verify books and documents and put identification marks on books and
documents. Except these two powers, he has no other authority. However, in
practice, stock inventory, cash count is done by the inspector. So also very
often statement is recorded in handwriting of the Inspector and signed by the
assessee and countersigned by an officer. The statement is recorded u/s.133A(3),
in search proceedings u/s.132(4), the oath is to be administered before the
statement is recorded. However, u/s.133A, the authorities have no power to
administer oath. Therefore, even if the assessee makes a false statement,
provisions of prosecution under the Indian Penal Code cannot be invoked. Three
important Sections of I.P.C. are excluded in survey proceedings. These are S.
179, S. 180 and S. 181 of the Indian Penal Code, which apply to refusal to make
statement, refusal to give evidence and refusal to give reply. But in search
proceedings, if any of these events occurs, the assessee can be prosecuted. S.
166 of I.P.C. provides that if a Government servant exercises any power for
which he is not authorised, he can be imprisoned for one year.

8. Rights of assessee during survey :


As far as search proceedings are concerned, the rights are given as guideline. These are applicable even during the survey proceedings. The assessee can do his normal functions required for carrying on his business activity, he and his assistants can go out for the assessee’s work. The only restriction is that he should remain present when his statement is to be recorded.

There is no power to arrest or confine the assessee to his business premises.

After inventory is taken, the assessee is asked to put values against each item of stock inventorised. But per law, after inventorisation, the function of survey comes to end. It is only at the time of assessment that the assessee can be called upon to evaluate and prove the valuation and to reconcile the same with stocks shown in books.

During the survey the search party insists on valuation and to quantify the difference solely with a view to persuade or compel the assessee to make high amount of declaration. But such action is not as per law. The survey party or even search party cannot restrict the movement of the assessee. This is held by Delhi High Court in its discussion on rights of assessee during survey proceedings, refer 194 ITR. U / s.132, governing search proceedings, there is power to break open doors, cupboards, cash boxes, false ceiling while making search of unaccounted valuables. No such power exists in S. 133A. If the cupboard or safe is locked, the officer can record his satisfaction about existence of valuable stored in it and get search warrant, whereby he can get the power to break open such containers.

As regards sealing of business premises or god owns, there is no such power to seal premises or god own with search authorities, nor survey authorities. [Shyam Jewellers 196 ITR 239.]

Generally survey proceedings end with recording statement and taking declaration from the assessee.

9. Retraction of declaration of disclosed amounts by assessee:

Whether the statement can be retracted? The statement is not recorded on oath. If it is so recorded, then it casts higher burden on the assessee to prove what he said was not correct.

Before retracting the statement the assessee should first consider the material gathered during survey and its value. Mere blanket retraction will not help the situation. But where materials gathered indicating concealed income form a small part of the disclosed amount, which is either through pressurisation or otherwise, then the assessee can retract his statement saying that it is taken under coercion. Retraction shall be made at the earliest point of time. Retraction statement should clearly set out the circumstances and factual events compelling him to disclose higher amount in his original statement recorded.

10. Three basic principles to be borne in mind are:

i) The amount disclosed in statement is not a conclusive evidence. One has to give due weightage to the circumstances leading to disclosure.

ii) Confessional statement given under ignorance of legal rights is not having evidential value. To illustrate, an assessee not aware of exemption to capital gain, discloses and includes such amount in his declaration statement, still no tax can be levied on such capital gain.

iii) The law is always open to convict a person if evidence is found to be false. Hence, even if declaration is produced before the Court, which is retracted, the Court will verify whether the evidence or material gathered, is sufficient to justify declared sum. If the answer is affirmative, then retraction will not stand the test of law. In converse situation, the Court will uphold retraction.

11. Issue of summons  during  survey  proceedings:

The power to issue summons is given when the assessee is creating hindrance in proceedings or not giving statement when called upon, then the officer can issue summons u/s.131 calling the assessee to attend his office on appointed day and time. S. 131 gives all powers of a Civil Judge to Af), Actually, if the assessee has cooperated and if stocks, cash valuables are inventorised, then summons is not necessary. This was held in 58 ITD 492 and 27 BCAJ 475, which supports the law that summons cannot be issued indiscreetly.

As decided in 246 ITR 353, a bar is put on recording the statement of the assessee over long periods. The recording of statements has to be completed within reasonable time.
 
In survey proceedings, the authorities persuade the assessee to declare large amount assuring him that penal proceedings will not be invoked if he discloses such amount as indicated by officers. However, such assurance has no legal base.

Penalty u/s.271(1)(c) can be levied only when there is concealment of income or filing of inaccurate particulars. Hence, filing of returns is a prerequisite. If the due date for filing the returns of current year is not yet expired and if the disclosed amount is not related or attributable to earlier year’s income, then there is no ground to initiate S. 271(1)(c)proceedings.

12. Accounting treatment to stock and cash difference :

The undisclosed stock included in the stock inventorised can be brought into books by debiting stock and crediting income. Thereafter the assessee can pay tax as Advance Tax. In 190 ITR 43 (Born.) it was held that where due date for filing has not yet expired, no penalty can be levied if such difference is submitted to tax as income. So, if the undisclosed stock or cash or any valuables not disclosed relate to current financial year and not earlier year, then the assessee need not file declaration regarding such stock, but can incorporate the same in current year income and pay tax. This position will not be applicable if such undisclosed income relates to earlier year. The speaker said that a survey is something like voluntary disclosure scheme always available to the assessee by disclosing it as current year income.

13. Power to impound stocks, cash and other assets, books of accounts & documents:

Prior to 1st June, 2002, there was no power to impound anything from business premises. After 1st June, 2002, officers can impound books of accounts and documents and no other assets. The definition of books of accounts is contained in S. 2 (12A) and documents are defined in S. 2(22A). So any loose papers noting unaccounted sale may not fall in the definition of books of accounts, still survey party can inventorise them and will require the assessee to produce them at the time of assessment proceedings. Those documents which are unsigned, which are undated, unsigned Memorandum of Understanding, may not be documents.

14. Presumptions:

In S. 132(4A) there are certain presumptions, viz. (i) contents  of documents are presumed to be true; (ii) The handwriting will be presumed to be of the assessee unless proved otherwise, (iii) signatures will be presumed to be of assessee unless proved otherwise.

However, all these presumptions available during search proceedings are not available during survey proceedings.

15. Presence of CA. during the course of surveyor search:

The speaker felt that such presence will facilitate the proceedings in its smooth functioning. Unfortunately, S.C in 62 Taxrnan 73, has held that whatever is noted in proceedings is the statement of facts. The concerned person is not yet accused and no charge sheet is filed against him, so the work of investigation is in nature of finding of facts, hence CA. or an Advocate has no role in these proceedings. Based on this their presence is not permitted.

16. Time limit for return of impounded documents:

After impounding the documents, ten days’ time is given to retain them, after which those documents are returned unless the officer takes permission of CIT or Director of investigation to retain them for further time by recording the reasons. Such recording is necessary even at the time of impounding.

In 156 ITR, S.c. has held that documents collected even during illegal search can be a piece of evidence which the Dept. can use against the assessee. The Commissioner while giving permission for retaining documents beyond ten days has to record the reason for giving such permission and according to the Speaker, he should intimate the same to the assessee. In search & survey, no appeal is provided. The only remedy is writ which is expensive.

When disclosure of excess cash and excess stock is made, the difference is treated as income. But where there is a shortage, then the Dept. will presume that the difference is unaccounted sale. But entire estimated sale price will not constitute income, a due deduction of cost of material can be claimed from such sale. The same is the position of cash on hand. If cash of, say, Rs.5 lakhs is found but cash per books is, say, Rs.1 lakh, the entire difference though treated as unaccounted sale, the assessee can claim cost of unaccounted purchase as deduction and the difference alone will be concealed income. Again, since the source for unexplained investment is proved, provision of S. 69C or other sub-sections of S. 69 will not apply. Therefore entire shortage of stock or cash will never constitute income. Accounting entries to regularise excess stock or excess cash in the same financial year by debiting stock or cash and crediting income. The entry can be made at any time, at the time of surveyor thereafter. Excess stock can be entered in stock book with corresponding entries in financial books. However, in case of a manufacturer, the incorporating entries of sales (unaccounted) will expose him to liability under indirect taxes like excise, sales tax, vat. In case of traders, if the amount is credited as commission, then service tax gets attracted. As against this, it is possible to argue that income was from derivative trading speculation or commodity trading. Though the source gets explained, the confrontation in Indirect Taxes, VAT, etc. can be avoided. In case of less cash and more stock being found, a set-off can be claimed. Hence due care should be taken when the assessee is made to disclose. He can reserve his explanation till the date of assessment proceedings.

17. Copies of statements recorded:

Can the assessee ask the authority to furnish him copies of statements – The answer is in the negative. The judicial view is that the assessee gets the right to demand it only when any such statement is used against him.

The meeting then terminated with a vote of thanks to the learned speaker.

Completion of ‘Four years of Right to Information Act’

Lecture Meeting

Subject : Completion of ‘Four years of Right to
Information Act’ — A meeting organised by BCAS jointly with IMC and P.C.
Governance Trust

Venue : I.M.C. Hall, Churchgate, Mumbai.

Date : 12th October, 2009


Part-A :

A brief report on proceedings of the meeting.

On 12th October, 2009 the BCA Society, Indian Merchants’
Chamber and P. C. Governance Trust jointly organised the above meeting in
which many august institutions and NGOs in the city participated in
celebrating the Fourth Anniversary of Right to Information Act introduced on
12th October, 2005.

(1) The meeting started with opening speech of Julio
Rebeiro representing, Indian Merchants’ Chamber. The speaker outlined the
objective and purpose of the Act and gave valuable suggestions on strategy to
be adopted for effective implementation. He expressed his satisfaction that
not only masses in cities but also in villages are becoming aware of the
utility of the Act, which will help in checking corruption and will make Govt.
authorities accountable and answerable.

(2) Narayan Varma representing BCAS Foundation said that
his Foundation has started RTI Clinic and is attending through telephone
service the complaints and grievances of the members of public. The Foundation
publishes articles in newspapers, writes books, articles and publications
which are widely appreciated. He stressed the need to make public movement
more effective.

(3) Anand Castolino of Bombay Catholic Sabha, informed that
his institution organises many meetings in various parts of city of schools
and college students, senior citizens and many others. The persons attending
the meetings participate actively. Every week, clinic is held in the Mahim
office to help persons suffering in hands of corrupt and irresponsible Govt.
authorities.

(4) Paramjeet Singh explained work done by his Dharma RTI
Mission. His concern has established Help Centres aided with computer and
other equipments. The RTI Help Centre is focussing on collecting information
from schools, colleges about non-receipt of Govt. grants and provides
assistance in filing applications. The slum areas in Govandi are also visited
where meetings are held of residents to register their grievances. These are
then forwarded to concerned offices and are followed up thereafter.

(5) Ashok Ravat represented Forum of Free Enterprise, M. R.
Pai Foundation and N. A. Palkhiwala Memorial Trust. He complained about the
road blocks created by administrative persons in replying the applications
filed. The authorities invariably try to take shelter u/s.8 of the RTI Act to
avoid giving answers to questions raised and to furnish details. He informed
that Books, Guides and Information materials are published explaining various
provisions of the Act and Rules. The forum of free Enterprise is also keeping
in touch with Bank Depositors Association. Instances of frauds on depositors
by private banks and co-op. banks have become rampant. Unfortunately a
favourite plea is put forth by those Banks that they are outside the scope of
the Act. He stressed the need to remedy this unfortunate position. Another
road block put in by Govt. authorities is the common plea that the question
does not fit in definition of information. To overcome this, his organisations
are advising those applicants to approach State Information Commission since
S. 81 empowers the Commission to investigate into complaints.

(6) Mr. Rasikbhai representing Tarun Mitra Mandal, reported
that his organisation is conducting various seminars, programmes in Mumbai,
Thane and Navi Mumbai to train public on use of RTI Act effectively. His RTI
centre assists public in drafting applications, appeals and other procedural
matters for better implementation.

(7) The above representations were followed by short
lectures of a few students of law college.

In concluding remarks, the Chairman expressed satisfaction
that the movement is gathering momentum. He hoped that there will be proper
reciprocation from authorities in Govt. and public sector undertakings to make
the legislation meaningful and will bring transparency and will reduce
corruption. Hon. Justice Dhananjay Chandrachud was then requested to enlighten
the audience on this occasion.

Part-B :


Speech of Hon. Justice Dhananjay Chandrachud, Mumbai High
Court

The Hon. speaker said that the society should look to the
legislation not as a tool to raise issues but should consider it as a
movements and as an effective tool to achieve goal of transparency, efficiency
and should inculcate a spirit of social commitment amongst Public servants. It
should become a new way of life, an awakening in the society. It should
replace the apathy, the indifference in the heart of a citizen and should
encourage him to raise his voice against malpractices, which will improve
radically the functioning of Public bodies. The act will replace scepticism
with optimism, will replace apathy with active interest, will replace feeling
of absence of power with sense of actual power. It will encourage involvement,
by shedding indifference and alienation. It will replace the governance from
the hands of administrators into the hands of subjects who are the
beneficiaries. The reports that are published about the issue of non-receipt
of pensions, non- receipt of ration cards, distribution of lands to landless,
issues concerning Aanganwadi, Balwadi and variety of issue concerning
millions.

The Hon. speaker shared his experience on many of those
issues coming before the judiciary, where the judiciary could realise the hard
reality about the injustice done to the subject, by administrators.

Hon. Justice Chandrachud stressed, that there can be no
development without empowerment. Both are interwoven providing information
about governance is a sure way to empower the citizen in quest for
development.

‘At basic level, the right to information provides access to information. It is a means to an end and not an end in itself. There is a much deeper meaning in right to information. It means governance, which makes administrators realise their accountability to society. Though today we are at the threshold, the efforts should be in the direction of attaining the goal at availing access freely without barriers. Dealing with issues concerning judiary, Hon. Chandrachud said that de-regulation is becoming a Mantra of the day, in process of greater involvement of private sector. Impact of liberalisation or deregulation. Right to know is a constitutional right and the same cannot be abrogated confining the scope of the Act only to Govt. administration or public bodies.

Definition of Information given in the Act, covers information relating to any private body which can be accessed by a Public authority under any other law for the time being in force. Therefore, according to Hon. speaker, what can be accessed by Public authority can be accessed by any individual citizen also. Therefore, though the implementation is presently focussed on Public governance or Public officials, it has to be extended to private governance in course of time.

The implementation will have to be carried out at two different levels. Firstly, creating awareness of right in all stratas of society in Urban and Rural areas. It should be institutionalised by going beyond individuals. Their experiences should be shared. For easy and quick access the speaker said that the judicial Dept. has developed a software to have quick reference to pendancies of cases before the Court. Taking it as sample, softwares can be developed to have an access to statistics about issues regarding disposal of pending applications, subjectwise areawise, the information as to whether Appeals are disposed of expeditiously or not and other administrative issues. Mechanisation of operations in every part of functioning will greatly help attaining process of transparency and administrative efficiency. S. 8 of the Act is misused by authorities to deny access to information. But unless the information is of commercial confidence or related to national security, the access can not be denied. We need an era, where disclosure must be the norm and suppression of information should be an exception. It is only then the goal of having a free society with informed citizens can be attained.

The meeting terminated with a vote of thanks to Hon. Justice Chandrachud and to all dignitaries representing activist organisations for actively participating in the meeting.

Foreign Investments in Real Estate

Lecture Meeting

Subject : Foreign Investments in Real Estate



Speaker : Rajesh Kapadia, Chartered Accountant,


Past President, BCAS


Venue : I.M.C. Hall, Churchgate, Mumbai.



Date :
16th July 2008








(1) While reviewing the trend of prices of real estate over
the past three decades and while identifying the reasons for spurt in real
estate prices year after year, the speaker Mr. Kapadia candidly observed that
apart from other economic factors the main cause is the utter failure of the
Urban Land Ceiling Act, 1973 in attaining the declared objective for which it
was enacted. The objective of controlling the rising prices and bringing rates
of residential flats within reach of common man failed miserably. During the
period of emergency in the country and a few years thereafter, the prices of
residential flats were in the range of Rs.70 to Rs.80 per sq.ft. in South
Mumbai. Between 1986 to 1993 the prices remained fairly stable.

(2) After 1995 there is unprecedented rise in real estate
prices year after year. Now a new trend has emerged amongst the class of
developers of specialising in different categories, such as construction
projects for residential complexes, commercial spaces, hospitality i.e.,
hotels, industrial parks, malls and similar projects.

(3) To regulate the development projects, the regulating
authorities issued two Press Notes. But even these Press Notes excluded certain
categories from its purview e.g., Press Note 2 does not deal with
industrial park developments, which comes under automatic route. Similar
position exists in cases of development of warehousing, hotels, etc.

(4) As regards regulating the provisions applicable to
foreign investment in real estate developments, the speaker said that there are
four or five segments available to foreign investors who are either NRIs or
foreign venture capital investors or foreign institutional investors. For each
of these categories there are different norms.

(5) Regulations prohibit participation of foreigners in real
estate business as traders per se. However, real estate business does not
include development of townships, construction of residential and commercial
premises, roads, etc.

(6) On following two dates viz. 6th July 1991 and 3rd
March 2005, drastic changes were introduced in regulations which have made the
real estate business an attractive proportion to foreign investors. From 12th
January 2005 the permission of Govt. hitherto required for foreign investors was
done away with. As per Press Note No. 2, hundred percent investment in
development projects of townships, hotels and roads was allowed to non-resident
investors subject to the following conditions :

(a) For development of housing project, investment in land
acquisition of minimum 10 hectares which is equal to 25 acres, will be the
precondition. The question that needs consideration is whether a 100% subsidiary
Co. of a foreign company can acquire agricultural land for development. The
answer is that if the law of the State in which such agricultural land is
situated, permits such acquisition, then such company can purchase agricultural
land provided it takes steps to convert agricultural land into non-agricultural
land and uses it for development of building and not for purposes of
agriculture.

(b) Capitalisation norms and restrictions :


A foreigner making investment through a subsidiary in India
will be obliged to invest at least 10 million dollars. If investment is made
with Indian joint venture partner, then capital contribution will be 5 million
dollars. The investment should be within 6 months from commencement with lock-in
period of 3 years from date of investment.

(c) What constitutes joint venture :


The ratio of investment in such joint venture need not be
equal. The foreign investors can have dominating percentage. As regards period
of six months from commencement, Press Note No. 2 provides that the date should
be counted from the date when agreement to subscribe shares is entered into
between co-venturers. The minimum prescribed amount of 5 million is to be
brought in within six months. The condition of lock-in period of 3 years applies
to minimum investment and not to additional investment over and above minimum
investment.

(d) Time period for completion of project :


At least 50% of the project has to be completed within five
years from the date from which all the clearances are obtained. The investor
will not be permitted to sell undeveloped plot. It means that before effecting
any sale, he must have completed development of plot by carrying out
construction of roads, water supply lines, drainage, water storage and related
facilities. It means, the investor must develop 10 hectares of project plot
before effecting sale.

(7) The speaker then observed that the boom in real estate
trade is attributable to excess liquidity in the economy. Many foreign investors
find that they are suffering cash crunch though the lock-in period is yet not
over. For making the development project viable, they have already invested
funds over, say, 25 crores plus Stamp Duty @ 1% and if at that stage any
disputes or difficult situation arises, then to meet the liquidity challenges
the only way is to dispose of their surplus investment over minimum by
transferring their shares or to liquidate holdings through buy back of shares or
to liquidate the company. In another situation if construction has already
started but if constructed area cannot be disposed of profitably, the investor
will face serious difficulty. Where development of land, say, of 10,000 sq.
meters is undertaken, then built-up area of 50,000 sq.mtrs. will be available
assuming FSI of 5. In the event response to constructed area is very poor, then
the loss may be much higher. The foreign investor has to keep in mind all such
situations.

8) The speaker then clarified that in the event the project fetches good profit, then dividend can be declared, subject to transfer of required percentage to reserves.

9) As regards companies in real estate, with huge capital investment of, say, 100 crores, the foreign borrowing for purchase of land is not permitted. Such borrowing’s are permitted only for financing construction work. As issue of shares at premium is possible, in such a case the capital base can propor-tionately be kept smaller. However, it is necessary to look into Reserve Bank guidelines. The amount of premium can be considered, for satisfying the condition of minimum capitalisation. External Commercial Borrowings (ECB) is not permitted. On
1-6-2008 the Government has put a bar on issue of non-convertible preference shares or non-convertible debentures. Debentures must be convertible and time frame for conversion has to be observed. But, if the company has committed to issue non-convertible debentures prior to 1st June 2008, then such company can continue with its commitment. In another situation if company wants to change over to convertible debentures, then Reserve Bank should be approached before taking such step.

10) Another aspect is satisfying valuation norms prescribed by the Controller of Capital Issues, pre-vailing up to 1992. Though this order was abolished, valuation rules prescribed by CCI regulations still continue.

11) As regards conversion of preference shares in equity shares, such conversion is treated as transfer for ascertaining capital gains liability of shareholder.

12) As regards conversion of debentures into shares, S. 47(10) of the Income-tax Act provides that the same will not be regarded as transfer. Transfer of shares by one foreign Co. to another foreign Co. requires no permission, nor is it governed by transfer pricing rules, nor by pricing guidelines. The same principle applies to transfer by one NRI to another NRI. Where transfer of shares is from person resident in India to non-resident, no approval is required. This however is subject to compliance of guidelines, set out in circular of RBI of October 2004 and pricing guidelines.

13) Any gift by a resident to a resident outside India needs RBI approval. Where there is a transfer by a person outside India to a resident in India, the repatriation of price realised above fair value will not be permitted to such non-resident.

14) Mr. Kapadia then stressed the need on the part of non-resident investor to give serious thought to structuring aspects of joint venture investment, by planning of route to be adopted, by studying the provisions of DTAA, and FEMA, whereby the tax effect can be minimised and his investment will be ideally tax effective and cost effective.

15) The speaker thereafter touched upon the various segments of real estate trade. It cannot just be restricted to conventional form of construction of buildings, but also takes into consideration other forms. The capital investment requirement and form of organisational set-up vary from each other. The few illustrations are:

a) Real estate management company needs to have minimum net worth of 5 crores.

b) There was one more category of O.CB., where 60% of holdings were owned by non-residents. Now, 50% of Directors of such real estate management company should be financing directors. The unit should invest in real estate projects of which 80% should be in completed projects and maximum up to 20% in incomplete project. Investment in vacant land is not permitted. These provisions at present are in a draft form till guidelines are notified.

c) The other avenues in real estate are development of service plots, residential or commercial premises, development of townships, investment in manufacture of building materials, investment in joint ventures, and similar other forms of organisation. In respect of many of the avenues there are no limiting or restrictive conditions like minimum capitalisation or lock-in period. The only requirement is the investor should be an NRI, a person of Indian origin. All these investments will be on repatriable basis.

d) As regards foreign venture capital investors fund, clause 5(5) of Foreign Venture Capital Fund Regulations of 1998 plays an important role. The constitution of a venture capital undertaking has to be a company whose shares are not listed on a recognised stock exchange in India and which should not be engaged in an indus-try specified in negative list. The advantage is lock-in restriction and pricing restriction are done away with.

16. Regulations  Re : Real  Estate  Mutual  Fund:

The only requirement is that management of such mutual fund shall have at least 5 years expertise in real estate trade. The investment should be in a specified real estate asset and not in incomplete projects or projects under construction. It must be located in India and in such city as may be specified. The property should not be subject matter of any litigation. At least 35% of net assets of the fund will have to be invested directly into real estate asset and therefore such mutual fund will not be equity-oriented mutual fund. Distribution made by mutual fund will be subject to dividend distribution tax. The investment can also be made in shares, debentures, mortgage-backed securities. The investment in these can be 75% and balance 25% in any securities. No real estate mutual fund can invest more than 25% of its capital in unlisted shares. The NAV of the real estate mutual fund shall be published every 90 days.

17. While concluding his talk, the speaker narrated a quotable quote of Pandit Jawaharlal Nehru on the eve of Independence in 1947. Hon. Panditji said, “The achievement which we celebrate today is a step of opening as an opportunity to the greatest triumph. We should be wise enough to grab this opportunity and accept the challenge of future”. This statement applies even today in current economic scenario.

The meeting terminated with a vote of thanks to the speaker.

Recent Developments in Direct Taxation

Lecture MeetingDate
: 14th July, 2010

Venue : IMC Hall, Churchgate, Mumbai


Speaker : Pinakin D. Desai, Chartered Accountant


Subject :
Recent Developments in
Direct Taxation




1. After a brief
introduction of the topic for the evening, the learned speaker took up for
discussion the Source Rule. The amendment by the Finance Act, 2010 had widened
the source rule for interest, royalty and fees for technical services. As a
result, in case if technical services are rendered by a Non-Resident (NR) in
India, then even if the NR does not have a residence/place of business/business
connection in India or the NR has not rendered services in India, still a case
could be made out that the non-resident will be chargeable to tax in India.

The learned speaker explained the decision of Ishikawa
Jima Harima Heavy Industries Ltd. v. CIT, (288 ITR 408) (SC) which had laid
down the theory of Territorial Nexus for taxing the income of a non-resident in
India. The learned speaker was of the view that the retrospective amendment by
the Finance Act was made with a view to overrule the said decision as well as
the ratio of :




  •   Jindal Thermal Power Co. Ltd. (Kar.) (225 CTR 220)



  •   Clifford Chance v. DCIT, (Bom.) (221 CTR 1)



Subsequent to the amendment, the Mumbai Tribunal in the case
of Ashapura Minichem Ltd. (2010) (5 Taxman 57) made a distinction between
rendering of service in India and provision of service in India, viz.,
provision of service in India does not require that the service must be
performed or rendered in India. The speaker observed that in the context of
territorial nexus the rendition and provision of service should have been
regarded synonymous conditions. However, since this aspect was not addressed by
the Tribunal, the controversy in regard to whether or not the test of Ishikawa
is satisfied in case of a NR performing service from outside India remains open.

In the opinion of the speaker the following situations would
not be affected by amendment :




  •   Absence of Article on Fees for Technical Services (FTS) in DTAA



  •   DTAA on restrictive fees for included services (FIS) concept



  •   Cases protected by Independent Personal Services Article



  •   Interest/royalty/FTS paid for business/source of income outside India
    [Domestic Source Rule exception — in S. 9(1)(vi)(b)]



2. The next development discussed was the taxability of
shares received by non-corporates. S. 56 was amended w.e.f. 1st June 2010 to
hold that in case of a partnership firm or a closely-held company, if there is
receipt of shares of a closely-held company, without consideration or for a
consideration less than the fair market value (FMV), then such shares would be
liable to tax in the hands of the recipient if the difference between the FMV
and the consideration exceeds Rs.50,000.

As per the explanatory memorandum, the purpose of this
provision was to capture the clandestine transactions in the transfer of
property through the medium of shares. The speaker felt that this intent may not
be appreciated by lower judicial forums and that could result in problems in
respect of genuine transactions.

According to the learned speaker the amendment would not
apply to the following assets :




  •   Mutual fund units



  •   Convertible or non convertible debt instrument



  •   Coupon/warrants



Areas of concern would be receipt of bonus shares, rights
shares, receipt of shares on amalgamation, conversion, split, etc.

3. The third amendment was the insertion of S. 47(xiiib). The
speaker was of the view that the following conditions specified may pose a
challenge for a smooth conversion of a company to an LLP :




  •   All shareholders of company to become partners in the LLP : This
    would mean that even the preference shareholders should become partners in
    the LLP. This might not be an acceptable criteria and some remedial action,
    such as redemption or conversion of preference shares to debt, might need to
    be undertaken.



  •   Shareholders not to receive any benefit except by way of profit share &
    capital contribution     : The safest position would be to convert the
    accumulated profits to capital contribution and not to withdraw the same for
    3 years. Salary and interest could be continued to be paid as they are not
    payments on conversion to LLP.



  •   Sales/Turnover/Gross Receipts in business to not exceed Rs.60 lakhs in
    the first 3 years     : It could be contended that if the company is not in
    business, i.e., it is not carrying on any business activity, this
    condition would not apply. If the company is in profession, this condition
    may still apply because business includes profession.



Another issue would be as regards the operation of S. 79. In
the opinion of the speaker, the term shareholding has been defined very
restrictively by courts and hence, conversion to LLP could constitute change in
shareholding and as a result the benefit of carry forward of losses may be lost.

The fourth issue was regarding losses in respect of transaction in derivatives. The learned speaker felt that the CBDT issued Instruction to Assessing Officers to disallow losses in respect of such transactions decision of the Apex Court in Woodward Governor India P. Ltd. (312 ITR 254]  Actual losses allowable only if the transactions qualify as ‘eligible derivative transactions’ under clause (d) of proviso to S. 43(5)  : There have been judicial decisions that if a derivative transaction, not covered by S. 43(5)(d), is a hedging transaction, then the onus is on the assessee to prove the same. However, once it has been proved, then the transaction has to be treated as a business transaction and not as a speculation transaction. Hence, this part of the instruction is also questionable.

  4.  The speaker then discussed various proposal mooted by the Direct tax code (DTC) the concept of place of effective management (POEM) proposed by the DTC. According to judicial forums POEM would be where the Board of Directors or Executive Directors make their decisions. In such a case a wholly-owned foreign subsidiary of an Indian company would have a POEM in India and therefore become resident.

The provision regarding Controlled Foreign Company (CFC) proposes to tax passive undistributed income of a CFC of a resident. In respect of the passive income earned by a Foreign Company (FCo) controlled directly or indirectly by an Indian resident, the DTC proposes that income not distributed shall be deemed to be dividend received from FCo.

As a result, there could be double taxation. The income of the CFC would be taxed once in the hands of the FCo on the basis of residential status and again, in the hands of the ICo on the basis of the CFC provisions.

General Anti-avoidance Rules (GAAR), gave immense powers to the Assessing Officer to disregard an arrangement that had been entered into by a taxpayer for the purpose of obtaining a tax benefit. According to the speaker, GAAR would apply to a transaction if while obtaining a tax benefit, the transaction fulfils any one of the following four conditions  :

  •     The arrangement not at arm’s length

  •     It represents misuse or abuse of the provisions of the Direct Tax Code

  •     Lacks commercial substance

  •     I sentered in a manner not normally employed for bona fide business purposes

The learned speaker then discussed the concerns regarding the implementation of GAAR provisions.

  5.  Finally, the following recent rulings were discussed by the learned speaker  :

  •     Vijaya Bank (SC) 320 ITR 577  :

Credit entry in debtor’s account not necessary to constitute ‘write-off’ for the purposes of bad debt write-off deduction u/s.36(1)(vii).

  •     Kelvinator of India (SC) (LB) 320 ITR 56  :

AO does not have power to ‘review’ his own order. S. 147 permits reassessment where there is ‘reason to believe’. Reassessment on change of opinion is review of order.

  •     Kanchanganga Sea Foods Ltd. (2010 TIOL 03 SC-Intl.)  :

S. 5(2) creates charge for NR Company, inter alia, in respect of income received in India. If first receipt in kind is in India, subsequent sale and realisation outside India does not impact taxation.

  •     Times Guarantee (Mum. SB) (ITA No. 4917 and 4918/Mum./2008)  :

Law as applicable on 1st day of relevant assessment year applies to carry forward and set-off of Unabsorbed Depreciation (UD). S. 32(2) was amended substantively from A.Y. 2002-03 and position applicable to A.Y. 1996-97 was restored. Such amendment is not applicable to UD of the period from A.Y. 1997-98 to A.Y. 2001-02.

Drafting of Appeals, Representation and Rules of Evidence

Lecture Meeting

Subject : Drafting of Appeals, Representation
and Rules of Evidence

Speaker : Chetan Karia, Chartered
Accountant

Venue : I.M.C. Hall, Churchgate, Mumbai.

Date : 6th August 2008





(1) The learned speaker, while setting out the scope and
coverage, remarked that the subject has three elements. Actually each element
can become a topic by itself for discussion. Still to make the discussion
concise and informative, he combined the first 2 elements, viz. drafting
and representation together and the third one was considered separately.

(2) The right of appeal is not an inherent right, but is
conferred by statute to ensure natural justice in arriving at fair and just
quantum of income through Appellate process. In CIT v. Ashoka Engineering
Co., 194 ITR 645 (SC), the Supreme Court held that such provisions giving
right of appeal should be liberally construed.

(3) The speaker suggested that before filing an appeal, the
order appealed against needs a careful study. Apart from quantum addition and
its tax effect, one has to ascertain whether the additions are unjust and unfair
and also whether they are contrary to provisions of law. One should also examine
whether addition, though small in the current year, would set a bad precedent
for future. While deciding whether the appeal is really called for the merits
and strength of the case should be looked objectively. The appellant should also
keep in mind the powers of enhancement vested in CIT(A). There is no right to
withdraw the appeal. The entire assessment gets open before CIT(A) and his
powers are co-terminus with powers of the AO. CIT v. Rai Bahadur Hardotrai
Motilal Chamaria, 66 ITR 443 (SC).

(4) Drafting of Statement of Facts and Grounds of Appeal
: The statement of facts plays very important role in appeal proceedings.
The Appellate authorities while deciding the appeal need to have before them the
basic facts and events that transpired during assessment proceeding. Whatever is
stated in the assessment order is the version and viewpoint of the AO while
arriving at his decision. If the appellant is in disagreement with the AO’s
version, he has to convincingly put forth before the Appellate Authority, his
standpoint and facts of his case and evidences in support of those facts. At
this juncture, it is necessary to consider whether all these facts and evidences
were laid before the AO during the assessment proceedings.

As regards drafting of grounds of appeal, the speaker advised
that grounds should not be argumentative and lengthy, but should be short,
precise and to the point. Once it is decided that the appeal is to be filed,
then it must be filed strictly within the period of limitation.

(5) The various issues that need consideration in appeal proceedings are :


(a) whether the AO had jurisdiction to pass the impugned
order. Jurisdiction means not only territorial, but also consideration of period
of limitation within which the order is to be passed (S. 153), the financial
limits, obtaining prior approvals of superior authorities, recording in
assessment order and on proceeding sheets about his satisfaction that a
particular default was committed, particularly in penalty proceeding
u/s.271(1)(c). In appropriate cases jurisdiction should be challenged.

(b) Consideration of additional evidence : If
it is the case of the appellant, that the AO has not given sufficient
opportunity to present such evidence before passing the order or that the
assesses was prevented by sufficient cause from adducing such evidence, then
specific prayer should be made to take on record and consider such evidence
before passing Appellate order.

(c) The appellant can take additional grounds and press fresh
claims not set out in appeal memo, if the material relevant thereto is already
on record. In the following cases before Supreme Court and High Courts, this
issue has been considered and the ratios of those cases should be considered
before taking up such additional grounds. The assessee can make alternative
pleas for consideration of Appellate Authority, e.g., allowing
depreciation, if certain expenditure is treated as capital expenditure.

The citation of cases on making fresh claims not originally
claimed in grounds of appeal are as follows :

(i) CIT v. Kanpur Coal Syndicate, 53 ITR 225 (SC).

(ii) CIT v. Jute Corporation, 187 ITR 688.

(iii) National Thermal Power Co. Ltd. v. CIT, 229
ITR 383 (SC).

(iv) Ahmedabad Electric Co. v. CIT, 199 ITR 351 (Bom.)
(FB)


(d) The following judgments on filing of additional grounds
not originally taken in the appeal memo :

(i) Shilpa Associates v. ITO, 263 ITR 317 (Raj.),

(ii) Baby Samuel v. ACIT, 262 ITR 385 (Bom.).


It was held that additional ground can be taken any time
before the appeal is heard.

(e) The appellant should ensure that all taxes due on
returned income are paid before filing of appeal. S. 249(4) puts a clear bar or
powers of CIT(A) to entertain any appeal if taxes due on returned income are
unpaid on date of filing of appeal.

(6) Filing appeal before ITA Tribunal and filing of cross
objections :


Both the parties i.e., the assessee and the Assessing Officer, aggrieved by order of CIT(A) can file their appeal before the ITA Tribunal. The time limit is 60 days from the date of receipt of Appellate order of CIT(A) where the Department has filed an appeal to ITAT; the assessee can file cross objection to the Department’s appeal. In such cross objections the assessee can file an appeal on all grounds raised by him which have not found favour with CIT(A). So also where the assessee has claimed allowability on alternate grounds and CIT(A) has allowed on one ground and dismissed the other, then the assessee can raise cross objection against alternate ground dismissed by CIT(A).

(7) Representation before Appellate authorities:

The role of the representative is to assist the Court in arriving at correct and judicious judgment. While taking every effort to present the client’s case more effectively, the tax representative should not identify himself with success of client’s case. The facts of the case should be carefully studied before making appearance before the Court. The submission both on facts and on law should be compiled in the form of paper book.

The paper book should be exhaustive enough to cover all materials supporting the grounds but not bulky. The order in which the papers should be arranged should assist smooth flow of presentation of arguments to be made before the Appellate authorities.

In case of appeal before ITAT as per ITAT Rules, though bulky paper book is filed during proceedings, it is only those papers which are referred to in the Appellate order form part of the case records.

The rules governing the filing of additional evidence are Rule 46A of IT Rules for appeal before CIT(A) and Rule 29 of ITA Tribunal Rule, for appeal before the Tribunal.

8) Presentation of judgments, decided cases before the Court :

The accessibility to innumerable cases with citations has become possible due to computer technology. This calls for skill of a professional to be selective. it is not the decision, nor discussion in a judgment cited is to be relied upon, but the ratio decidendi is more important. There is difference between ratio and obiter dicta. Doctrine of precedents should also be borne in mind. Supreme Court judgment is binding on all authorities and becomes the law of the land. After the Supreme Court, the judgment of jurisdictional High Court has equal binding force in that State, till such judgment is reversed. Where there is no judgment of jurisdictional High Court, then judgments of High Courts of other States have binding force on the Tribunal. If there is conflict in judgments of two High Courts, the Tribunal can follow judgments which are closer to the case before it. So also the judgment of Special Bench is binding on coordinate Division Benches.

9) Some practical suggestions on presentation and on ideal behaviour of tax representative during hearing:

a) Dress Code: The prescribed dress to be worn should not be too gaudy.

b) Behaviour gestures, body language, should not be irritating, provocative but should be normal and decent.

c) Eye contact should be maintained with Members of the Bench.

(d) The speech, its tone and speed: The tone should be polite and should have clarity whereby the message gets conveyed.

e) It must always be remembered that the Appellate authority i.e., CIT(A) or the Tribunal Bench being deciding authorities, have every power to ask any question for finding of facts as well as for collecting information. The representative must reply all such questions patiently and to the point. He should never question the relevance of enquiry.

f) The representative should avoid the habit of interrupting when the representative of other side (DR) or members of the Bench are speaking.

g) The representative  should know where to stop.

(10) Rules  of evidence:

The authorities deciding the case, the AO, CIT(A) and the Tribunal have to give their findings while deciding the case. For that purpose support has to be taken of some credible and conclusive evidence. Such evidences is required to be brought on record by following certain procedure:

a) In Prabhavati S. Shah v. CfT, 231 ITR 1 (Born.); the Bombay High Court has held that the Rules put fetters on rights of the assessee to produce additional evidence, but not on Appellate authorities to consider it if they want to consider. Where the AO has made addition based on statement of any party behind the back of the assessee and contents of such statement is contradicted by the assessee, then he must be given opportunity to cross-examine the deponent. This is relevant while deciding merits of additions u/s.68 and u/s.69.

b) Income-tax proceedings are quasi-judicial civil proceedings and hence the provisions of the Evidence Act applicable to criminal proceedings are not applicable to Income-tax proceedings. This is held in the following cases:

    i) Dhakeshwari Cotton Mills v. CfT, 26 ITR 775 (SC)

    ii) Kishinchand Chellaram v. CIT, 125 ITR 713 (SC)

    iii) J. S. Parker v. V. B. Palekar, 94 ITR 616 (Born.)

    iv) Chuharmal v. CfT, 172 ITR 250 (SC).

c) Books of accounts regularly maintained are good evidence but not conclusive. This is held as evidence in V. C. Shukla’s case 3 SCC 410 (SC), 82 ITD 85 (Mum.) (TM).

d) If opportunity is not given to the assessee, such evidence is not good evidence and addition based thereon will not sustain. [Kishinchand Chellaram, 125 ITR 713 (SC)]

e) Cross-examination and statement of witnesses: if during the cross-examination the witness contradicts his earlier statement, then his statement cannot be relied upon by the AO for making addition and is to be completely ignored.

f) The information given by the witness should be factual and not based on hearsay. It is necessary to prove what is apperant is real. [Durgaprasad More v. CIT, 82 ITR 540 (SC)]

g) Rule 46A : The CIT(A) has full right to decide whether additional evidence should be admitted or not. Where it is the contention of the assessee that he was prevented by sufficient cause, he has to prove it.

h) Substantial cause and Rule 46A of the LT. Rules or Rule 29 of the ITAT Rules: The Supreme Court in K. Venkat Ramaiah v. A. Seetharam Reddy, AIR 1963 SC 1526 has ruled that in the interest of a fair judgment, the Appellate authority should take a sympa-thetic view and should not deny admission of evidence on hypertechnical ground.

The meeting terminated with a vote of thanks to the learned Speaker.

Real Estate Development Agreements — Tax Issues including Deduction u/s.80IB

Lecture Meeting

Subject : Real Estate Development Agreements — Tax
Issues including Deduction u/s.80IB.



Speaker : T. N. Manoharan, Past President,
ICAI


Venue : IMC Hall, Churchgate, Mumbai



Date : 27th June 2008








1. The learned speaker Mr. Manoharan said that the topic of
discussion was not only very wide, involving high financial stakes, but also
involved various legal aspects right from titles to property, tax implications
from the point of owners vis-à-vis developers, year of assessability,
judicial views and decisions, consideration of direct tax laws as well as allied
laws and multiple other issues. He therefore divided the subject by giving
consideration to :

(i) Legal aspects as to title.

(ii) Incidence of levies under direct tax laws as well as
allied laws like Stamp Duty, Registration, Service Tax.

(iii) Impact of Accounting Standards, method of accounting
for developer.

(iv) Tax implications affecting land owners, year of
assessability, exemptions.

(v) Quantification of consideration receivable.

(vi) Determination of year of transfer.

(vii) Case laws & judgments applicable to the owners.

(viii) Deductions u/s.801B (10), conditions precedent for
developers and issues thereunder.

(ix) Inflow of foreign investments in real estate.

(x) Emerging professional opportunities from booming real
estate development trade.

2. After setting out the broad spectrum and coverage, the
speaker moved to deal with each aspect.

3. Legal aspects concerning title to property :


The study of professional begins with examination of
documents conferring perfect and marketable title to property; by examining
antecedents, family tree of owner, whether title is derived by intestate or
testamentary succession, family settlement or by gifts and whether the documents
are properly worded and registered; study of pending litigations affecting clear
title, etc. As per the Supreme Court’s decision in Chandersen case, the son
deriving title from his deceased father in intestate succession succeeds it as
his individual property and not HUF property. The exception is where directions
are given in the Will bestowing the title in HUF capacity. Another exception is
family settlement. Such transaction is not liable to Gift Tax. In any case gift
in kind is outside the purview of S. 56(v) from donee’s point of view.

4. Incidence of levies :


Under the Stamp Act in Maharashtra, the Stamp Duty rate is
concessional i.e., 2% only on market value. In other States also, the
concessional rate is applicable. In Karnataka, the duty on gifts of immovable
properties to relatives is only Rs.1,000, irrespective of value of property. In
Tamil Nadu it is 1% with a ceiling limit of Rs.10,000. Therefore, through gifts
of immovable properties to close relatives, by incurring very reasonable cost,
it is possible to make income-tax and wealth-tax planning within the family.

The speaker then observed that the stigma attached to
transaction in immovable properties, viz. existence of unaccounted money
is gradually vanishing. This is due to increasing foreign investment in real
estate market, exemptions to capital gains through investments in notified bonds
and purchase of new properties, thirdly, reasonable levy of Stamp Duty and
fourthly impact of S. 50C introducing presumptive receipt of consideration.

5. Tax implications as applicable to developer :


The earnings that a developer would be making are governed by
Accounting Standard 7. In 2002, AS-7
got revised. The chance of completed contract method was given a go-by. Now, if
the developer is acting as contractor in charge of development, he has to
quantify profit on percentage completion method. However, if the developer is
acting as builder taking risk and reward on his account, then AS-7 is not
applicable but AS-9 (Revenue Recognition) will apply. Accounting Standards’
interpretation 29 clarifies that revenue should be recognised by considering
factors of risks and rewards, substantial completion of project and other
relevant factors like method of accounting regularly followed.

In transactions of dealing in land, the land becomes
stock-in-trade for the purchaser, attracting S. 40A(3) if any part of payment is
paid otherwise than cheque. For small value constructions, benefit of S. 44AD is
available to contractor.

6. Tax provisions applicable to owner of land :


Generally speaking proper documentation assumes great
importance since terms and conditions will determine the correct year of
assesability, the year of transfer, the claims of exemption under one or more
Sections, quantification of capital gain, opening of capital gain account, dates
for payment of advance tax. More specific issues in this regard are :


(a) Consideration : When owner agrees to convey his land, very rarely he recovers entire money consideration at the time of executing the contract. It is received mostly by instalments or is paid partly by money and partly in kind like built-up area. In case of joint ventures it is received only when the project is complete. The value of constructed area allotted to the owners towards purchase consideration is determined on basis of cost of construction and not at a price charged to outside flat purchasers. In the process, if the owner has to bear compensation to the occupants/tenants of his property, it will be legitimate deduction from capital gain accruing to him. The owner has to take note of S. 50C; in cases where consideration stated is less than market value adopted by Stamp Duty authorities. Prior to insertion of S. 50C, chapter XXC was on the statute book putting a curb on circulation of black money by understating apparent consideration. The chapter XXC was applicable to some cities and to transactions over certain monetary limits. Those provisions were withdrawn. S. 50C applies to all transactions in land and building, irrespective of situs and consideration amount.

b) Year of transfer: Prior to A.Y. 1988-89, the Supreme Court decision was holding the field, fixing the taxability to the year in which conveyance is executed and registered. To overcome the practical difficulties and to plug the loophole, S. 2(47) defining transfer was amended by inserting sub-clauses (v) and (vi). Newly inserted sub-clause (v) takes in its fold transactions where the possession of the subject property is taken or retained by the transferee in part performance of contract as per S. S3A of the Transfer of Property Act. In such cases, the transfer will be deemed to be complete even if the deed of conveyance is not executed and registered. Sub-clause (vi) deals with transfer of flats in co-operative societies. In these cases, where the owner/transferor’ executes a general power of attorney in favour of transferee, authorising him to carry out all acts and deeds in furtherance of the project, it will be deemed that the transfer is complete.

c) Joint development agreement between the owner and builder/developer: where owner gets consideration in the form of built-up area. Though one can argue that such transaction is covered by clause ‘exchange’ in S. 2(47)(i), still liability to capital gain will crystallise on basis of sub, clause (v) due to granting possession and power of attorney to builder. Therefore, at least to the extent of funds required for investment in notified securities u/s. 54EC and for tax amount, suitable provisions for receiving money consideration from the builder should be made in agreement. By executing limited power of attorney in stages and by keeping control/domain over property, the owner can defer immediate tax liability.

d) Following case law on year of Transfer and year of taxability needs very careful consideration.

i) Chaturbhuj Dwarakadas Kapadia, 262 ITR 491 (Bom.)

ii) Jasbir Singh Sarkaria, 294 ITR 196 (AAR holding that execution of general power 6-attorney results in transfer

iii) Receipt of substantial consideration by the landowner. Mumbai Tribunal in Geetadevi Pasari’s case, 104 ITJ 375 (Mum.) has considered ratio of Chatubhuj Dwarkadas Kapadia. It has distinguished the case before it and held that where the transferee has not observed condition of S. S3A of the Transfer of Property Act, the deeming fiction of sub-clause (v) does not get triggered as substantial consideration remained un-paid.

The learned speaker therefore stressed the need of proper documentation. By making specific provisions in development agreement that effective control and possessory rights over the property will remain with owners at least till transferee makes substantial payment of agreed consideration. The owner should also refrain from giving general power of attorney to the builder.

Alternatively, the owner should ensure receipt of money consideration enough to cover investment in securities prescribed u/ s.54EC and tax liability.

7. Exemption from tax is available to developer on compliance of conditions precedent, listed in S. 80IB(10).

After considering the tax issues applicable to owner, an equally important issue applicable to builder is compliance of S. 80lB(10) entitling him to complete tax exemption. Though, it is not applicable to projects approved after the cut-off date of 31-3-2007, still ongoing project can merit exemption if local authorities have approved the project as residential housing project prior to the cut-off date. However for the projects undertaken for slum clearance and notified by the Central Government, the conditions of area of plot and cut-off date are not applicable. The developer of ongoing eligible projects should strictly adhere to and comply with the conditions of area of plot, area (built-up) of flats and obtaining completion certificate from local authorities within 4 years from the date when the building plan is first approved. So also the commercial area should not exceed 5% of total built-up area or 2000 sq.ft., whichever is less. The promoter / developer need not own the land to avail benefit of deduction. Where the project is of merged nature i.e., housing and commercial, the judicial opinion as per reported judgments is divided. Varying from stricter version of total denial to milder version of pro-ration. The following decisions as well as CBDT clarification need careful attention. The citations are:

a) 113 TTJ (Ahd.) 300 – ownership of land by developer is not precondition
b) Case law on housing cum commercial projects:
105 ITD (Mum.) 657
108 ITJ  (Che.) 71
109 ITJ  (Mum.) 335
ITA No. 1735 (Cal.) – Bengal Ambuja 108 TTJ (Che.) 71

8. Alternative remedies available to landowners to avoid litigations on year of taxability, practical difficulties in availing funds for investments u/s.54EC, The speaker discussed the following alternative modes. If the landowner converts his property as stock-in-trade, there will be capital gain on the date of conversion, but the year of taxability as per S. 45(2) gets postponed to the year in which he realises the consideration. The excess, of course, will be business income. For capital gains, clause (iv) of S. 2(47) will apply and not clause (v). The Jodhpur Bench in 298 ITR 97(AT) has held that S. 53 applies only when the document is registered. Second mode is that the landowner, after conversion of capital asset into stock-in-trade can enter into partnership or joint venture with builder. By this he can reap the benefit of sharing the surplus with the builder. The capital gain element can be invested in prescribed securities within 6 months from the date of realisation. It is also possible to spread over the realisation in more than one year and benefit of investment can be availed, for each such year.

9. Recent development that needs attention is increased flow of funds by foreign investing institutions in real estate trade. As a by product, such development will provide increased and challenging professional opportunities to members of profession.

The meeting ended with a vote of thanks to the learned speaker.

Taxation of Expatriates

Lecture Meeting

Subject : Taxation of Expatriates

Speaker: Pinakin Desai, C.A. Past President, BCAS

Venue : I.M.C. Hall, Churchgate, Mumbai.

Date : 4th March 2009

1. Broad scope : The learned speaker delivered his lecture and simultaneously displayed slides to ensure that all related issues get covered considering the complexity of subject. The determination of tax liability of an expatriate is governed by domestic law and DTAA provisions.

2. Coverage :

(a) Broadly, the subject will cover the tax liability of expatriates, who are either :
 
(i) Resident of other country, or
 
(ii) Persons of Indian origin coming to India for a short period for taking employment in India.
 
(b) The domestic law provides an option to get himself taxed in his home country on income carried in India, if the DTAA provides such option or otherwise to pay tax on income earned in India and to claim tax credit from tax determined in the home country on global income.
 
(c) Expatriates of the above category may be coming to India as employee of foreign company on deputation for rendering services on project undertaken by such foreign employer, or may take an employment with Indian company. In both cases, the tax liability under Indian Tax Law is attracted on salaries earned in India.

3. Dictionary meaning of Expatriate :

A person, who moves from his home country to another country to earn some emolument is known as expatriate.

4. The domestic law provisions applicable to salaries earned in India are :

S. 9(i)(ii) provides that salary earned in India by a non-resident individual will always be considered as chargeable in India.

5. The meaning of salary earned in India :

Explanation to S. 9(i)(ii) creates some controversy — salary paid for services rendered in India is chargeable to tax in India. There is distinction between salary chargeable in India and services rendered in India. One meaning is that whenever the person is physically present in India and renders services during such period, it is salary earned in India. A case may arise where a non-resident, during his service period is frequently travelling outside India, then whether the payment to him for the period when he is outside India is also covered by term services rendered in India. The term earned in India is a wider term which may include the earning outside India, if such earning has nexus with services rendered in India. There are two conflicting Tribunal judgments on this issue.

Under domestic law, salary earned in India is taxable. In case of employees working on rigs there is a cycle of working for say 21 days continuously followed by leave period of 21 days and so on. In such cases, the payment to him for vacation period, if followed by working period, then, salary for rest period will also be treated as salary earned in India liable to tax in India. The rest period preceding or succeeding the work period will also be considered as period of service. The right to enjoy the leave is an emolument flowing from services rendered continuously.

S. 10(6)(vi) provides tax exemption to salary if three conditions stated in that Section are fulfilled. This exemption is different from exemption available to a foreign technician; for S. 10(6)(vi) the persons need not be a technician.

6. Treaty provisions applicable to salary
earned in India and related issues :

Salary provisions are governed by treaty Article, which is titled as Dependent personal services or Income earned from employment. There must be employer-employee relationship for invoking this Article. The treaty provisions to be applied are from the treaty with the country of which the employee is a resident and not of the country of employer who may be resident of some other country.

This is important because where a non-resident taking employment abroad has to travel in another country in connection with his service in India the question may arise, in the absence of this Article as to fixation of liability to deduct tax in Multiple situations, based on source or on physical stay or place where contract is signed. This will create uncertainly about place and amount. The provisions in the treaty will resolve this chaotic situation. The tests to be applied for determining employer-employee relationship are too well known. They do not apply to a working partner of a firm or a professional person dealing on freelancer basis or Director of company as Board member.

Article 16(1) of India-US Treaty — (Dependent personal services) deals with salary, wages, derived by Non-Resident employee, who is resident of the USA. Such salary will be chargeable in the USA irrespective of place where services are rendered. The exception to this rule is where employment is exercised in India. In that case, credit of tax suffered in India can be availed by such USA resident in his country.

As observed earlier, an expatriate will mean and include an Indian citizen coming to India for employment or a foreign citizen taking employment with an Indian company or may be taking employment with a foreign company on deputation on a project undertaken by the foreign company or P.E. of the foreign company. The presence of such person in India to necessary on long-term basis.

7. Considerations not relevant for applying Article 16(1) are :

(i) The place where fruits of an employment are enjoyed is not a relevant factor. If work is exercised in India it is sufficient to attract tax liability under domestic law.
     
(ii) Place of signing contract, say, in UAE is not relevant where work is exercised in India.

(iii) Headquarters of the employer not relevant.

(iv) Place where emoluments are remitted is not relevant.
     
(v) Residence of employer or nationality of employee is not relevant. Exercise of employment should generally be of long-term nature and not just casual visit.

Article 16(2) of India-US Treaty:

Article 16(2) deals with circumstances where income may not be taxable in India: This Article provides that income from exercise of employment in India will be taxable in the USA if the following three conditions are fulfilled. The conditions or tests are negatively worded. When these negative tests are converted into positive tests, they become alternative condition. If anyone of these three conditions is fulfilled, then India gets right to tax such emolument in India.

(a)    The stay of U.S. Resident in India is more than 183 days.

(b)    Remuneration of such US employee is paid by or on behalf of a person, who is resident in India. The number of days stay in India as in (a) above is not relevant.

(c)    The employment should be functionally attached to P.E. of foreign company. In that case his salary will be taxable in India.

In all the above three tests, it will be necessary to show that employment was exercised in India, when such employee was present in India.

8. Analysis of above  conditions:

As regards first test of stay exceeding 183 days, if the stay is prolonged for more number of days due to sickness or hospitalisation, then such excess stay need not be considered, if otherwise the stay was less than 183 days.

There is some basic difference while interpreting provisions of law and provisions of Articles in treaty. The former is to be strictly construed even at the cost of equity, whereas the treaty being a commercial agreement between two countries, a liberal and equitable approach is permissible.

The second condition is residence of employer in India who is bearing the salary of the non-resident. Such person is normally an employee of foreign company which has deputed him in India for rendering services in India and after his term in India, he is returning to his foreign employer. Till his emoluments for services are rendered in India, the tax is chargeable in India. There may be a case where salary is initially paid by U.S. company and debited to Indian company, even then the position remains unchanged if there is a service contract with Indian company or if Indian company controls his performance of service. So also if the fruits of such service including intellectual property rights are vesting in Indian company, then this test can be said to have been satisfied. The third test is whether remuneration of foreign employee is borne by permanent establishment in India of foreign employer.

There is also reference of fixed base which has same meaning. The term ‘fixed base’ applies to foreign professional firm/ company, whereas P.E. is of business concern.

The logic in taxing emoluments of employee in India is that since the salary paid is claimed as deduction from income of P.E., the tax is chargeable in India. The position remains unchanged even if income of P.E. of foreign employer is taxed on presumptive scheme u/ s.44BB.

The working of income from salary in case of expatriate is to be done in the same manner as in case of resident salary earner.

9.    Following issues can arise in computation of salary:

(a)    Triangular situation:  Illustration:

Example: A U. S. company under a contract with a Norwegian resident deputes him on a project to explore business opportunities for US Co. in India during service period 1-12-2007 to 31-7-2008. The U.S. Company is not having a P.E. in India. Similarly, in both the financial years, viz. 2007-2008 and 2008-2009, the stay of the Norwegian employee is less than 182 days. The question for determining tax liability is which treaty is applicable. As seen earlier, the India-Norway treaty will apply and not India-U.S. treaty.

A recourse is to be taken to three alternative tests. Though the services are rendered in India, they are for less than 183 days in each financial year, so first test Of number of days stay fails. For 2nd test, though services are rendered in India, the employer company is not resident of India. It is U.S. company which is a Non-resident Co. and not having P.E. in India, nor US company is carrying on business in India. It is only exploring opportunities in India. So 2nd test also fails, As regards the 3rd test, the provisions in India-Norway treaty makes a difference.

Normally test of 183 days is to be applied for each financial year separately. In this case, the exemption u/s.l0(6)(vi) (where stay in each year has to be less than 90 days) is also not available to the foreign employee. In respect of India-Norway treaty, the stay for 183 days is to be worked out by taking stay for two consecutive fiscal years together. In view of this treaty provision, the Norwegian employee’s emoluments earned in India will be liable to tax under domestic law u/s.9(1)(ii).

(b)    Issue on split  residency/dual  residency test:

Example: A UK national comes to India in 1st April, 2007 and leaves for the UK in October’ 2007. He has permanent home in the UK. His residential status for India and the UK tax laws for Financial Year 2007-2008  will be as follows:

He is resident in India due to 182 days’ stay. He will also be resident of the UK per tax law of the UK. His earning in India up to September 2007 is liable to tax in India and if from October 2007 to March 2008 he has taken employment in the UK it will be liable to tax in the UK. The difficulty arises due to dual residential status as resident of both India & the UK. Though Indian tax law does not recognise split-residency concept, the UK. tax law considers this concept.

In another case, where a resident of UK has stayed and worked in India for say 21hyears and goes back to the UK he will be considered as Resident of the UK from the day of his returning to the UK.

In the first case for UK tax for first six months up to September, 2007 he is non-resident he being in India; for second six months he is Resident of UK. As per S. 6 he is resident of India considering his stay in earlier years and stay more than 60 days during April to September 2007. Similarly, per UK Law, he becomes resident of the UK the moment he arrives in the UK even though up to September, 2007 he was Non-Resident of UK he being in India.

In such situation, tie-breaker test as provided in OECD update of 2008, will have to be applied. This will apply to income earned in the UK between October 2007 to March 2008 determining which provision of treaty will apply. If it is found that he is treaty resident of the UK by applying tie breaker test, for last 6 months he will be taxed as if he is UK Resident and not as Resident of India.

(c)    Issue on Overseas Social Security Contribution:

The learned speaker cited two judgments on deductibility of contribution for social security viz. Gallotti Raoul 61 ITD453 (Mum.) and Eric Moroux (2008) TIDL 145 (Del.) while explaining the facts and ratio, he stated that it is a case of French National coming to India under employment of French Co. working in India. From emoluments earned in India, the Employer Co. used to make two mandatory deductions.

(i)    Contribution for benefit of all French nationals, and

(ii)    contribution to social security to cover the benefit and costs including impairment in earning potential, medical, old age, professional sickness, etc. These contributions were not providing addition to personal savings like P.P. contribution. There is no income potential provided under the scheme. The French I.T. Act permitted these contributions as deduction from salary income.

Considering these features, those contributions were treated as diversion by overriding title and deductible from gross salary earned in India, and not as application of income.

(d) Issue on ESOP Levy-Key  events and Triggers:

The applicable parameters are:

(i)    When ESOPs are granted, it is called ‘grant day’. Thereafter subject to the employee’s complying with certain conditions, there will be a vesting. Such shareholder will be eligible thereafter to exercise his right to get allotment.

At the stage of grant by employer there is no tax effect for the employer nor for employee. On the date of vesting, the value gets frozen, but at that time there is no taxability for FBT from employer. S. 115WB(i). After exercise of option, shares will be allotted and on that day the FBT will be payable on the value which was frozen. If the employer recovers the FBT from employee there is a cross charge of amount of FBT recovered from expatriate em-ployee. If, however, the expatriate employee remained outside India from date of grant till the date of exercise of option, then no FBT will be payable. In another situation where the employee was based in India for two years after ESOP was granted, but was outside India on date of exercise of option, after say 3 years the allotment is made, then FBT liabil-ity on frozen value will be worked out proportionately i.e., 2/5th or 40%. No FBT will be payable on balance 60%, when employee was outside India. The same rule will apply to foreign companies offering ESOP to employees based in India.
 
Where proportionate FBT is recovered from employee, this will not affect FBT liability of employer. As regards employee, if benefit of ESOP is taxed in foreign country in the hands of employee, then he can claim rebate or tax credit of FBT borne by him in India, because FBT is nothing but income-tax.

10.    Conversion rate for Salary earned in Foreign Currency Illustration:

Take a case where the salary due on the last day of each month, if actually paid on 10th day of succeeding month. Assuming that on 31st July was Rs.40 per $, whereas on 10th August the rate was say Rs.45 per $. In such case Rule 115provides that the income is to be worked out at the rate when salary is due i.e., 31st July in the present case and not at the rate prevailing on date of receipt. But can employee say that he will pay tax on Rs.40 and not Rs.45 which he has actually received. Similar situation arises re : capital gain received by foreign investor. Though arguable, it is possible to contend that Rule 115 will be binding on Tax Department.

But in opposite case whether the employee can say that his tax liability will be on actual lower realisation and real income principle should be applied.

11. Credit  for overseas  taxation  for TDS u/s.192:

Taking a hypothetical case, where an Indian Company has P.E. abroad, say, in Germany where its employees are working. Those employees are paying tax on their emoluments as per tax laws of Germany. If such employee was in India for part of the Financial Year and received salary in India and thereafter was posted abroad in P.E. of the Co., then the employer can work out the tax on total salary and give credit for the tax deducted in foreign country. The balance tax will be collectible u/s.l92.

However, the CBDT Circular giving guidance note on working of tax liability of employees is silent about giving tax credit for tax deducted in other country. A better view is that per Sec.90, if a treaty exists with a country which has deducted tax, then treaty provisions will supersede substantive provisions of S. 192. A caveat to this is that if foreign Government terms the deduction as provisional and refundable in appropriate cases, then the Indian employer should deduct tax out of abundant precaution.

The meeting terminated with a vote of thanks to the learned speaker Shri Pinakin Desai.

Chanakya on Finance and Accounting, 20th March 2013, at the Indian Merchants’ Chamber

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Lecture Meetings Chanakya on Finance and Accounting, 20th March 2013, at the Indian Merchants’ Chamber

Mr. Radhakrishnan Pillai (Speaker), Mr. Naushad Panjwani, Mr. Deepak Shah (President), Mrs. Yamini Dalal

In this lecture meeting held under the auspices of Shri Dilip N. Dalal Oration Fund, Mr. Radhakrishnan Pillai, a well-known Author and Management Trainer, explained relevance of Chanakya’s teachings contained in his treatise Kautilya’s Arthshastra, to present day business,with insights and practical examples. The main focus of the session was Chanakya’s teachings with respect to management of ‘Kosha’ which means ‘Treasury’ and four stages of Wealth, namely Wealth Identification, Wealth Creation, Wealth Management and Wealth Distribution. The presentation interlaced with witty comments kept the audience glued to their seats until the very end. The presentation is available at www.bcasonline.org and the video recording of the meeting is available as a webcast at www. bcasonline.tv to subscribers.

Provisions in Companies Bill relating to Auditors, 3rd April 2013, at the Indian Merchants’ Chamber

Mr. Kamlesh Vikamsey, Past President of the ICAI, explained and analysed various provisions of the Companies Bill 2012 that cast onerous responsibilities on the auditors and have far reaching implications. The speaker also explained the potential impact of the provisions and some key issues. The talk enthralled the full house audience consisting of senior and junior members in the profession as well as the students and left them with greater awareness about forthcoming responsibilities. Speaker’s presentation is available at www.bcasonline.org and the video recording of the meeting is available as a webcast at www.bcasonline.tv to subscribers.


Mr. Kamlesh Vikamsey (Speaker), Mr. Chetan Shah, Mr. Deepak Shah (President), Mr. Mukesh Trivedi

presentation is available at www.bcasonline.org and the video recording of the meeting is available as a webcast at www.bcasonline.tv to subscribers.

Interactive session on issues relating to Charitable Trusts, 10th April 2013, at the Indian Merchants’ Chamber


L to R: Mr. Mangesh Deshpande (Speaker), Mr. BharatKumar Oza, Mr. Gautam Nayak, Mr. Sanjiv Dutt (Speaker), Mr. Deepak Shah (President), and Mr. Govind Goyal

Charitable Trusts are faced with various issues pertaining to compliance under the Income-tax Act, 1961 as well as the Bombay Public Trusts Act, 1950. The Society organised an Interactive session with Mr. Sanjeev Dutt, Director of Income Tax (Exemption), and Mr. Mangesh Deshpande, Assistant Charity Commissioner, with the objective of apprising the authorities about difficulties faced by charitable trusts, understand perspective of the Authorities and bridge the gap between the two. In their presentation and talk, Mr. Sanjeev Dutt and Mr. Mangesh Deshpande explained their perspective and expectations from the Charitable Trusts and the Auditors and answered various queries raised by the participants. The sessions were chaired by Past Presidents Mr. Govind Goyal and Mr. Gautam Nayak.

Other programmes:

Workshop on “Practical Issues in Tax Deduction at Source”, 22nd March 2013, at the Navinbhai Thakkar Auditorium, Vile Parle, Mumbai


L to R: Mr. V. K. Pandey (Speaker), Ms. Saroj Maniar, Mr. Gautam Nayak, Mr. Deepak Shah (President), Mr. Jagdish Punjabi

The Taxation Committee organised this workshop where the following learned faculties spoke on the topics mentioned below:

FACULTY TOPIC
Mr. V. K. Pandey, CIT(TDS) Overview of TDS
Mr. Yogesh Thar, CA Section 192 – Salary including salary paid to expats
Mr. N. C. Hegde, CA Section 194A, Section 194C, Section 194J, Section 194H, Section 194I
Mr. Naresh Ajwani, CA Section 195 – Payment to Non-Residents
Ms. Babina Dinashan, Senior Manager, NSDL TDS Return Filing and Assessments -Tax Credits, Issues and Resolution
The workshop received enthusiastic response from over 500 participants including members from the Industry as well as the Profession, who appreciated the wealth of knowledge and experience shared by the Learned Faculties.

Seminar on EPC Contracts, 13th April 2013 at the JW Marriott, Mumbai


L to R: Mr. Ashish Ahuja (Speaker), Mr. Dhishat Mehta, Mr. Kishor Karia, Mr. Naushad Panjwani, Mr. Tarunkumar Singhal

The International Taxation Committee organised this seminar, where the following learned faculties covered the topics mentioned below:

The participants gained immensely from the wealth of knowledge and experience shared by the speakers.

Professional Accountant Course Batch XV – Convocation, 12th April 2013, at the HR College

The Human Resources Committee successfully completed Batch XV of its flagship course the Professional Accountant with the Convocation function to award “Professional Accountant” Certificates to 60 participants who successfully completed this Course. It was a memorable event for the participants who put in hard work to learn practical and theoretical aspects of day-to-day accounting and tax compliance from 23 sessions conducted between November 2012 to March 2013 while continuing pursuit of  their regular job. The participants acknowledged and appreciated the valuable learning from this course that would help them in their career and gave valuable feedback to help make this programme more effective.

The convocation function was graced by Ms. Indu Shahani, Principle of HR College, Professor Parag Thakkar, Vice Principal of HR College, Mr. Mayur Nayak, Chairman of the HR Committee, Mr. Bharat Oza, Convenor of the HR Committee, and Mr. Manish Reshamwala, Course Coordinator, along with other dignitaries.

I.P.C.C. Refresher Course, 9th, 10th, 16th, 17th, 23rd and 24th March 2013, Directiplex, Andheri

 IPCC Refresher course was conducted by Human Resources Committee for the first time in the suburbs at Directiplex, Andheri.

The following were the subjects and the faculties at this refresher course:


Nearly 50 students participated at this  Refresher Course which was co-ordinated by Mr. Hemant Gandhi, Convenor, and Ms. Smita Acharya, Member, of the HR Committee.

Lecture Meeting and Other Programs

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LECTURE MEETING:

Important Provisions under the Companies Act, 2013, 9th October 2013

BCAS had organised a lecture meeting by Mr. P. R. Ramesh, Chartered Accountant with an objective to make members aware about the important amendments and the important provisions of the new Companies Act, 2013. The speaker spoke about important topics like Accounts, Audit and related party transactions etc. He spoke about how the new Act was a game changer for the profession and the businesses. He also spelt out several unclear provisions, such as consolidated financial statements, commencement / applicability of various provisions, definition of share capital and reserves, definition of control for a holding company, amongst others, where the provisions were ambiguous. The speaker also answered the queries raised by the participants.

Nearly 400 participants attended the meeting. The video recording of the lecture meeting is available on BCAS Web TV to the subscribers.

OTHER PROGRAMS:

Music Clinic – Swar Se Ishwar Tak, 18th October 2013

HR Committee and Membership & PR Committee of BCAS had jointly organised the Music Clinic highlighting the use of music for destressing and healing our lives. The Clinic was run by Dr. Rahul Joshi, MD – Homeopathic Medicine, who took the participants through a musical tour for 3 hours involving the audience at regular intervals. The program focused on healing of chakras in the human body by giving them affirmations and positive music to motivate and enhance the wellbeing of the entire body. More than 150 participants benefited from this innovative program organised by BCAS.

RTI Anniversary, 12th October 2013

BCAS Foundation, in collaboration with Public Concern for Governance Trust & Indian Merchant Chambers, had organised the celebration of RTI Anniversary. The State Chief Information Commissioner Mr. Ratnakar Gaikwad was the Chief Guest on the occasion. Padma Shri Nana Chudasama, Padma Shri Julio Ribeiro and Shri Narayan Varma graced the occasion as the guides on the subject for RTI.

More than 200 participants participated in this celebration arranged by BCAS Foundation including a High tea.

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Two-Day Orientation Workshop specially designed for fresh Articled Students, 26th & 27th April 2013, at the M.C. Ghia Hall, Fort, Mumbai

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Two-Day Orientation
Workshop specially designed for fresh Articled Students, 26th & 27th
April 2013, at the M.C. Ghia Hall, Fort, Mumbai



L to R – Mr. Bharatkumar Oza, Mr. Mayur Nayak, Ms. Nina Kapasi, Ms. Smita Acharya

In
this workshop organised by the Human Resources Committee, the following
learned faculties imparted learning to the articled students, on the
topics mentioned below:

In this workshop organised by the Human Resources Committee, the following learned faculties imparted learning to the articled students, on the topics mentioned below:
The workshop received a good response where newly enrolled articled students got a broad perspective of various subjects that they will handle during the course of their articleship.

Press Conference, 29th April 2013, at the Indian Merchants’ Chamber, Mumbai

A Press Conference was organised by the BCAS Foundation to discuss and explain the 97th Amendment to the Constitution of India dated 13th January 2012 wherein under Article 19, the term “Co-operative Societies” has been inserted. As per the legal opinion of Senior Advocate Firoze Andhyarujina released at this Press Conference, “After the Constitutional Amendment and the status granted to the co-operative societies of self-governance, the RTI Act would be applicable to the Co-operative Society, more particularly after it being self-governed by the Maharashtra State Ordinance of 2013, laying down the by-laws, rule, regulations, procedure and modalities”. However, as per the opinion of the former Central Information Commissioner Shailesh Gandhi, who was the chief guest at the occasion, the Right to Information Act would not be applicable to co-operative societies of any kind, including co-operative housing societies. Leading luminary Mr. Julio Rebeiro, and Mr. Narayan Varma, Trustee, BCAS Foundation, also discussed the implications of this amendment. The conclusion at the meeting was, that the applicability of RTI Act to co-operative societies would have to be tested by filing some RTI applications to housing societies, and pursuing the matter in appeal until it reaches the High Court.

mPower Summit, 10th & 11th May 2013, at the West End Hotel, Mumbai

The mPower Summit, held on 10th & 11th May, 2013 at the West End Hotel, Mumbai, was designed to help professional firms focus on “Mergers, Managing Growth and Mentoring Talent”.

The 2-day Summit, attended by over 50 participants, was unique in many ways – the speakers were drawn from 4 cities and the participants from 11 cities. Most of the participants represented the leadership team of their professional firms.

The keynote speaker, Ketan Dalal, connected well with the audience as he took them through his journey from a family firm to the leadership team of a Big-4. His talk was candid and inspiring as he not only opened up the windows of opportunities, but also cautioned on the hurdles along the way. His strongest message to the forum was that managing people is the key to a professional services firm, no matter what the size may be. In his charismatic and emphatic way, he concluded “remember, people leave people, people do not leave organisations….

When you see talent walking out of your door, introspect on how you are nurturing your human capital”.

The first day had interesting sessions. Sundeep Gupta, Chartered Accountant from Delhi explained the merger process, the science and art of engaging with another professional firm and the need to     ensure a cultural match prior to merging. Sujal Shah, Chartered Accountant played the devil’s advocate and explored the possibility of separating out a niche practice when the firm is considering a merger. He presented the audience with the ecstasy of creating one’s own institution built on one’s values and belief system and nurturing a niche area as opposed to becoming a part of a large set up having multiple service lines.

The first day concluded with a session by the Committee Chairman Ameet Patel, Chartered Accountant who awakened the audience to the need for innovation in the professional services firm – he stressed on the need for providing innovative solutions for clients as also for the internal functioning of the firm. He smartly presented the pressing need for professional services firms to shift focus from delivery to discovery – from execution to innovation – from time based billing to value pricing.

The highlight of the Summit was the uplifting session by Padmashri T. N. Manoharan, Chartered Accountant where he spoke of the role of the senior partners in creating an institution. With anecdotes and real life examples, he touched the hearts of the audience as he explained that “we are all mortal individuals with the power to create lasting institutions”. His humility reflected in his participating in the entire 2-day Summit as a quiet observer and his leadership reflected in the values and vision that he rolled out in his talk.

The next session, by Nandita Parekh, Chartered Accountant, Convenor of the Committee and the co-architect of the Summit, spelt out the formula for “living happily ever after” post a professional merger. She emphasised the need for a Code of Conduct, succession plan for the leadership of the firm and strategy for nurturing and retaining talent. Her illustrated presentation drove home the points with ease, as also added some colour to the event.

The next session by Sagar Shah, Chartered Accountant from Pune, rolled out a strategy for growth through geographic spread and networking. Young and energetic, he showed the participants the wonders that can be achieved with a clear focus, with a well-defined strategy and with mastering technology. He shared the HR initiatives taken by his firm to ensure excellence, excitement and energy at all levels. A very interesting remark by him about how unimportant one’s own name was in the context of overall growth of one’s firm was an eye opener for the participants.

The last session, “Of the Participants, By the Participants, For the Participants” ably anchored by Ameet Patel, Chartered Accountant provided a grand finale to an Empowering Summit where each of the participants shared their key ‘take aways‘ from the Summit.

The mPower Summit, a third in the series of Power summits, has been successful in taking forward BCAS image as an innovator and as an organisation which addresses the need of its members even before they become a necessity. The vision of the committee in identifying the need and designing the Summit year after year has provided a legacy that needs to be continued. May the Power summit of the BCAS be the meeting place for future partners and the starting point for lasting relationships!

Half-day training workshop on Empathy, 16th April 2013, at the Navinbhai Thakkar Board Room, Vile Parle, Mumbai

The Human Resources Committee organised this workshop as a continuation of the leadership camp conducted earlier with the theme of “Living in Harmony”. The learned faculty Shri M. K. Ramanujam guided the participants on Empathy and discussed various connected issues such as Feeling, Emotions, Understanding and Empathising. The learned faculty also discussed Triggers of Anger and shared tips on Anger Management. The workshop received very good response and participants gained immensely from the wealth of knowledge and experience shared by the speakers.