The Hon’ble FM amidst of outbreak of COVID-19 announced the extension of various statutory due dates for the taxpayers via a video press conference. The taxpayers had been demanding extension due to the inconvenience caused amidst the COVID-19 outbreak. Though preliminary analysis of each press note in the tabular manner has been made below but in next paragraph highlighting the important facts of announcements in brief
· Hon’ble Finance Minister has categorically mentioned that extension has been given for procedural and eligibility but not extension as if now for scheme related matters
· In general any due dates of returns, statements etc. under Direct Tax, Indirect tax including customs falling between 20th March to 29th June 2020 have been extended till 30th June 2020. It is both from taxpayer point of view as well as revenue point of view. HERE INDUSTRY WOULD HAVE APPRECIATED THE FACT THAT ANY MONEY DUE OR GOING TO GET DUE IF EVERYTHING HAVE OPERATED NORMALLY TO ASSESSEE FROM GOVERNMENT EXCHEQUER LIKE IN FORM OF REFUND OR INCENTIVE COULD HAVE BEEN DIRECTED TO PROVIDE ASAP BY GOVERNMENT EXCHEQUER MAY BE PROVISIONALLY IF DUE VERIFICATION CANNOT BE DONE BY GOVERNMENT EXCHEQUER in this financial distress
· Payment of any taxes under direct tax and indirect tax falling due under this period will be subject to interest @ 9% instead of 12%/18% as the case may be. In case of GST for composition dealer and assesse having turnover less than 5 crore interest on belated payment of GST is waived. HERE INDUSTRY WOULD HAVE APPRECIATED THE FACT THE INTERST WOULD HAVE BEEN COMPLETELY WAIVED WHICH COULD HAVE ACTED AS FINANCIAL SUBSIDY IN THIS FINANCIAL DISTRESS SITUATION
· Penalty and late fees for delayed payment of taxes and any furnishing of statement falling due for the period 20th March to 29th June 2020 is waived
· Some relaxation in Bank charges and fees has been made to provide and assist facility of lesser movement for public at large in this pandemic environment.
· To provide assistance to exports and imports 24*7 clearance facility has been made in customs. It has been termed as one of the essential service in press conference.
· In this financial distress situation various corporate measures both in company law and insolvency and bankruptcy code has been made.
· Ministry of Commerce will come with various extensions of timelines through various notifications.
What was missing and most likely could be announced either today by 8 pm by Narendra Modi jii or in coming days
· Financial package as economy needs urgent booster of large funds. Government cannot at miserly now and also fiscal deficit has to be kept in side while announcing this financial package.
· Major Institutions like RBI and SEBI needs to step up immediately, primarily to relax NPA norms and taking hold of capital market respectively.
· Cash flow and liquidity is going to be huge issue and companies which are cash rich can be compelled for buy back which would infuse much more required capital in the economy. Also various other measures to infuse capital/ cash inflow in this situation is required.
Author: Navneet Mangal
C.A. Navneet Mangal (FCA, ACS, B.Com)
Author is a practicing Chartered Accountant providing consultancy and advisory services to various corporates in states of Rajasthan, Delhi and Punjab. In his about 9 years of post-qualification experience, he has extensively worked with corporates in the area of tax planning, advisory, audit of Clients records of indirect taxes and other compliances. His regular involvement in corporates and start-ups has helped him understand the issues faced by them, their expectations and what is lacking. He is regularly engaged in writing Articles on various issues.
He has been awarded with Maharana Mewar Foundation Award in the Year, 2012 for his brilliant performance in CA Examinations.
CA Navneet Mangal can be reached at the mail id – firstname.lastname@example.org