Archive for the ‘Uncategorized’ Category

Message regarding alterations on Cheque leaf

June 8, 2010

All banks have received RBI guidelines by virtue of which Banks are supposed to prohibit alterations / corrections on the cheque leaf.

As per RBI Circular – DPSS.CO.CHD.No. 1832/01.07.05/2009-10 dated 22nd February 2010.

Prohibiting alterations / corrections on cheques :

No changes / corrections should be carried out on the cheques (other than for date validation purposes, if required). For any change in the payee’s name, courtesy amount (amount in figures) or legal amount (amount in words), etc., fresh cheque forms should be used by customers. This would help banks to identify and control fraudulent alterations.

Basis the above guidelines branch / clearing teams can return cheques which have any alteration in the

  • Payee Name
  • Amount in numbers
  • Amount in words

The only alteration which is allowed is the alteration in the date.

Bank branches will start returning the cheques for cash payments across the counter and Fund Transfer and clearing cheques effective 1st July 2010.

Extension of time limit for filing ITR-V to CPC Bangalore

February 8, 2010

Good news for the assesses filing their Income Tax Return electronically (without digital signature) on or after 1st April 2009. Central Board of Direct Taxes has extended the time limit for filing ITR-V to Centralised Processing Cell from 60 days to 120 days from the date of uploading of the electronic return data or till 31st March 2010 which ever is later. This extension is applicable for all the assesses who have e-filed their income tax return after 1st April 2009. So as per this circular if an assessee has e-filed his income tax return without digital signature on any date after 1st April 2009 but the copy of ITR-V was not filed to Bangalore office- CPC by any reason then that assessee can again send the copy of ITR-V to CPC- Bangalore before 31st March 2010 or 120 days from the date of filing return electronically which ever is earlier.

 However, in cases where email acknowledgement for ITR-V form is not received by the taxpayer from the CPC Bangalore the taxpayer may send another duly signed ITR-V form by speed post to Centralized Processing Centre, Electronic City Post Office, Bengalore, Karnataka – 560100. This means that if in case your ITR-V is not received by the Bangalore office by ordinary post then an assessee can send another copy of ITR-V by speed post.

The relaxation has been made following requests from taxpayers that, as a one-time measure, the time limit for filing of ITR-V form may be extended to 31st March 2010 and that alternative modes of submission of ITR-V form may also be provided in cases where an ITR-V form has not been received at CPC, Bangalore by ordinary post.

Adjustment of advance tax in respect of fringe benefits for assessment year 2010-11 against advance tax

February 8, 2010

The Finance (No. 2) Act, 2009 was produced and passed by the houses of Parliament in mid of the year 2009-10. In the Finance Bill a new section Section 115WM was inserted in the Income Tax Act, 1961 to abolish the FBT with effect from Assessment Year (A.Y.) 2010-11. Till that date many of the assessee had paid advance tax in respect of value of fringe benefits provided by employer to its employees. Hence, CBDT vide its Circular No. 2/2010, dated 29-1-2010 has decided that any assessee who has paid advance tax in respect of fringe benefits for A.Y. 2010-11 shall be treated as Advance Tax paid by assessee concerned for A.Y. 2010-11. The assessee can adjust such sum against its advance tax obligation in respect of income for A.Y. 2010-11 or in case of loss to claim such payment as refund as advance tax paid in A.Y. 2010-11.

Penalties under the Income Tax Act

June 24, 2009

There are different penalties leviable under the Indian Income Tax Act for defaults under the various provisions of the act committed by an assessee. There are many provisions under which the penalties are leviable under the act. There are some penalties that are mandatory in nature while in most of the cases penalty is leviable at the discretion of the Assessing Officer (AO). The major penalties that are imposed under the act along with their nature of defaults are given as under:

1.  Default: Concealment of Income or furnishing inaccurate particulars of income.

     Minimum Penalty: 100% of tax sought to be evaded.

     Maximum Penalty: 300% of tax sought to be evaded.

 2. Default: Failure to keep or maintain books as required u/s 44AA.

      Minimum Penalty: Rs. 25,000/-

 3. Default: Failure to get accounts audited or furnish report u/s 44AB.

      Minimum Penalty: ½% of the total sales, turnover or gross receipts.

      Maximum Penalty: Rs. 100,000/-

 4.  Default: Taking/Repaying or accepting any loan or deposit in contravention of the provisions of section  269SS /269T  (Loan taken or repaid above Rs. 20,000 in cash).

      Minimum Penalty: Amount of loan/deposit so taken or accepted or repaid. 

5. Default: Failure to furnish Return of Income.

     Minimum Penalty: Rs. 5000/-


How to pay taxes online?

May 11, 2009
E-payment of taxes (Income Tax and TDS) is mandatory for the following types of assesses:

  1. All Companies and firms
  2. All persons other than companies or firm who are liable to get their accounts audited u/s 44AB of the Income Tax Act.

Income tax can be paid easily from your workplace or from any place online by taking the following steps:

  1. Open the website and select “Pay taxes online” .


               Click on the following link:        

  1. Select the relevant challan from the NSDL site and enter your PAN/TAN as applicable.
  2. Enter the challan details, and select your relevant bank and “Submit”.
  3. Select whether you are a Retail Internet Banking user or Corporate Internet Banking user.
  4. Log in to your Bank Internet Banking portal with your user ID and password.
  5. Enter the details of the tax amount and authorize the payment.
  6. Download the acknowledgement of your tax payment.

For more information on e-payment of taxes click on the following link:

Wealth Tax

May 8, 2009

Wealth tax is charged for every assessment year in respect of net wealth. Wealth tax is also a direct tax just like income tax computed on net wealth of an assessee. But it is charged on the amount of net wealth exceeding Rs. 15 Lacs.

Rate of wealth tax is 1%.

Wealth tax is charged on the net wealth of an assessee valued as on valuation date. The valuation date for chargeability of wealth tax is 31st March of the financial year.

Net wealth means taxable wealth. Broadly speaking it represents the excess of assets over debts.
The term assets means ;
(i) Guest house, residential house or commercial building.
(ii) Motor Cars.
(iii) Jewellery, bullion, utensils of gold silver, etc.
(iv) Yachts , boats and aircraft.
(v) Urban land, and
(vi) Cash in hand

Public Provident Fund Account

May 8, 2009

Public Provident Fund account is a tax saving instrument . Many people use this account to save their taxes. There are many benefits of this account other than it is used as a tax saving instrument. Any person whether he be man or women, married or bachelor salaried or self employed must have a PPF account. A PPF A/c is opened for a term of 15 years and is used for investing for a long term. This term of 15 year does not include the year in which it is opened. During a financial year a maximum of Rs. 70,000/- can be invested into the account.

A PPF a/c has many of its advantages:
(i) A PPF a/c is opened for period of 15 years.
(ii) Interest received on amount invested is also tax free.
(iii) A PPF a/c can be operated with a minimum investment of Rs. 500/- per year also.
(iv) A loan can also be obtained on PPF A/c.

If a person has defaulted in investing the minimum in his PPF a/c he can reactivate his account by investing the minimum amount required and paying a nominal penalty of Rs. 50/-.

Year Ending Profits

March 16, 2009

With this another Financial Year coming to an end here are some important steps to be taken in the form of links :

1. List priorities while choosing tax-saving scheme

2.  Personal Tax: 10 things to do before March 31

3. Be careful while filing your tax return

Read all the links carefully to make tax returns easier.

Diwali Greetings

October 28, 2008



Tax saving Instruments

October 10, 2008

As per the Indian Income Tax Law in computing the total income of an assessee being an individual or HUF benefit of deduction to the aggregate of Rs. One lakh rupees is given.  The deduction is available provided the amount is invested /deposited or paid by the assessee in any of the items listed in section 80C of the Act. The most common type of investments/payments for which deduction is available are:

    1. Payment of Life Insurance Premium for himself, spouse and children and in case of an HUF payment of Life insurance Premium for any of member thereof.
    2. Contribution to Public Provident Fund. (max. upto Rs. 70,000/-)
    3. Contribution by employee to Recognised Provident Fund.
    4. Contribution by employee to Appproved Superannuation Fund.
    5. Any security specified by Central Government for this purpose.
    6. Contribution to Unit Linked Insurance Plan.
    7. Payment of tution fees for children for full time education in India (available for two children only)
    8. Repayment of Housing Loan taken from Central Govt, State Govt or Bank and other specified institutions.
    9. Term Deposit for not less than 5 yrs from scheduled bank and which is in accordance of scheme.
    10. Five year deposit in Post Office Time Deposit Scheme.
    11. Subscription of Units of Mutual Fund Specified for this purpose.
    12. Subscription for National Saving Certificate VIII issue.



Full Text of this section on available on the below mentioned link.