Income Tax Provisions and IMPORTANT DEFINITION

BASIC CONCEPTS

WHAT IS A TAX?

Tax is a fee charged by a government on a product, income or activity. There are two types of taxes – Direct taxes and Indirect taxes (See Chart below this paragraph). If tax is charged directly on the income or wealth of a person, then it is a direct tax e.g. income-tax. If tax is charged on the price of a good or service, then it is called an indirect tax e.g. excise duty. In the case of indirect taxes, the person paying the tax passes on the incidence to another person.

 

WHY ARE TAXES CHARGED

The reason for levy of taxes is that they constitute the basic source of revenue to the government. Revenue so raised is utilized for meeting the expenses of government like defence, provision of education, health-care, infrastructure like roads, dams etc.

LEVY OF INCOME-TAX

Income-tax is a tax charged on the total income of the previous year of every person. A person includes an Individual, Hindu Undivided Family (HUF), Association of Persons (AOP), Body of Individuals (BOI), a Firm, a Company etc.

IMPORTANT DEFINITION

1.       Assessee [Section 2(7)] – Assessee means a person by whom any tax or any other sum of money is payable under this Act. It includes every person in respect of whom any proceeding has been taken for the assessment of his income or assessment of fringe benefits. Sometimes, a person becomes assessable in respect of the income of some other persons. In such a case also, he may be considered as an assessee. This term also includes every person who is deemed to be an assessee or an assessee in default under any provision of this Act.

2.       Assessment [Section 2(9)] – This is the procedure by which the income of an assessee is determined by the Assessing Officer. It may be by way of a normal assessment or by way of reassessment of an income previously assessed.

3.       Association of Persons (AOP) ­– When persons combine together for promotion of joint enterprise they are assessable as an AOP when they do not in law constitute a partnership. In order to constitute an associate, persons must join in a common purpose; common action and their object must be to produce income.

4.       Local Authority – The term means a municipal committee, district board, body of port commissioners or other authority legally entitled to or entrusted by the Government with the control or management of a municipal or local fund.

5.       Artificial Persons ­– This category could cover every artificial juridical person (any organization having legal identity) falling under other heads.   It covers corporation, Bar council, Guru Granth Sahib, universities etc.

6.       Assessment year - The term has been defined under section 2(9). This means a period of 12 months commencing on 1^st April every year. The year in which tax is paid is called the assessment year.

7.       Previous year [Section 3] – It means the financial year immediately preceding the assessment year. The income earned during the previous year is taxed in the assessment year.

For example, for the assessment year 2012-13, the relevant previous year is 2011-12 (1.4.2011 to 31.3.2012).The total income of an assessee earned in the previous year 2012-10 is assessed in the assessment year 2012-13

8.       Business or profession newly set up during the financial year – In such a case, the previous year shall be the period beginning on the date of setting up of the business or profession and ending with 31^st March of the said financial year.

For Example

1.       A is running a business from 1992 onwards. Determine the previous year for the assessment year 2012-13.

Ans. - The previous year will be 1.4.2011 to 31.3.2012.

2.       A chartered accountant sets up his profession on 1^st July, 2011. Determine previous year for the assessment year 2012-13.

Ans. - The previous year will be from 1.7.2011 to 31.3.2012.

9.       Person [Sec. 2(31)] - The term “person” includes:

i.                     an individual (A natural Person) e.g. Mr. Ram, Ms. Anita,

ii.                   a Hindu undivided family / Joint Hindu Family  e.g.- Hari Om Brothers,

iii.                  a company e.g. KDK softwares (India) Private Limited,

iv.                 a firm e.g. Vikram Associates,

v.       an association of persons or a body of individuals, whether incorporated e.g. Rajasthan   Cricket Club,

vi.                 a local authority e.g. Jaipur Municipal Corporation, and

vii.    Every artificial juridical person not falling within any of the preceding categories e.g. University of Rajasthan.

These are seven categories of persons chargeable to tax under the Act. The aforesaid definition is inclusive and not exhaustive. Therefore, any person, not falling in the above-mentioned seven categories, may still fall in the four corners of the term “person” and accordingly may be liable to tax under section 4.
Source: http://taxmartindia.blogspot.in

Anjali khurana is associated with India-based Tax Preparation Software company. The company offers Online TDS Software to help chartered accountant for e-filing their tax returns easily.

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Information about USB Token for Digital Signature

These days security is main concerns especially when it comes to secure legal documents. So Digital Certificate is such legal document which is highly sensitive and should be more stores somewhere safely. Now there is a password-protected hardware device called USB Tokens which stores digital signature more securely.

USB Token provides facilities of durability and portability with security and ensures your Digital Certificate saves securely inside, can never be copied out of the token.

The USB tokens come with inbuilt software program to execute digital signature. USB token, e-token, dongle and digital signature token are few popular term in market.

Having a USB token is not compulsory but it is recommended to get a USB token for security reasons.

Who Can Apply for a Digital Signature Certificate?

The following can make an application to a Certifying Authority for the issuance of a digital signature certificate:

·         Individuals including foreign nationals
·         Hindu Undivided Family
·         Company (Directors and/or other authorized personnel)
·         Firm partners
·         Body of individuals (Members)

Symmetric Key Encryption and Authenticity of Message

Alice can employ symmetric key encryption to authenticate ibe message by generating ciphertext using her key for the entire plaintext |Bob, Can you provide me math lesson? Yes, why not. Alice]. She then sends the plaintext and a segment of the ciphertext to Bob. The segment of the ciphertext is identified as 'Message Authentication Code (MAC)* (a MAC is a function that takes a variable-length input and a key to produce a fixed-length output). This is shown in Figure belwo

Boh is able 10 authenticate the message that has been sent by Alice by generating the ciphertext using his key; he selects the same segment of the ciphertext and compare it with the MAC he received. This, however, only establishes the authenticity of the message source.

Symmetric Key Encryption and Integrity of Message

Alice can provide integrity to the message by applying secured Mashed MAC. Secured hash function takes a stream of data (message) and reduces tt to a fixed size through a one-way mathematical function. The result is called a message digest*; it is also called fingerprint or signature* of the data because the message digest can he reproduced by any party with the same stream of data, bin it is virtually impossible to create a different stream of data that produces the same message digest. Alice creates a message digest by applying Secure Hash Algorithm (SUA-1 specified in FIPSI80-) (N1ST96H or Message Digest |MD-5| and her secret-key to the message for Bob. Alice then transmits the message to Bob with the message and message digest.

 Advantages of using a USB Token for Digital Signature

A digital signature resides in the browser (e.g. Internet Explorer)of your system. Keeping it on your system means that it can be misused if your system is accessed by an unauthorized person. Also, the digital signature is lost if your browser (e.g. Internet Explorer) is changed or if your system is formatted.

Compared to this, a digital signature is very secure when it resides on the USB token since it is a password-protected device. The token also offers the convenience of portability since it can be plugged to the USB port of any system to use the digital signature.

Limitations and Drawbacks of Symmetric Key Cryptography

A serious limitation of secret-key encryption methodology is (hut it does not support non-repudiation. It is possible for une party lo falsely claim that it received a message I'm the other party as it has the key. It is, therefore, considered fairly weak on non-repudiation count. Scalability is one of the inherent problems with symmetric cryptography. In order for the communications to be confidential, the exchange of the key shared secret must be done securely. Secure distribution of secret-key and shared secret-key employing courier is not feasible when the number of different people with whom you want to communicate securely escalates beyond a manageable number. Hence, secret-key encryption is not recommended in situations where the number of parties involved is large, as each one would require a different key to ensure that each one is able to exchange the message meant for them.

Reach us to get Gemalto USB Token for Digital signatures. This USB Token store your Digital Certificate securely.

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XBRL Instance Documents and Taxonomies for Financial Information

Earlier in the chapter, we saw some of the complexities in the metadata for a business report. The XBRL specification supports a number of metadata concepts. As there is a wide variety of potential business reporting solutions, the specification does not pre-define concepts. Instead, taxonomy builders place all their concepts in a XML schema. The XML schema standard allows developers to construct their schemas similarly to the development of relational or object- oriented database schemas. These data structures are not sufficiently flexible, however, for the business-reporting environment. Instead, the schema is merely a simple list of all the concepts in the taxonomy. Structure in the taxonomy is provided in so-called linkbases. These are implemented in the XLink language. Figure 1.5 illustrates the interaction between schema and linkbases. The linkbases add all the richness of metadata to the concepts listed in the schema. We illustrate four of the linkbases in this example.

The first linkbase adds human readable labels to the concepts (label linkbase). The XML technology allows taxonomy builders to provide a variety of labels (e.g. terse labels, verbose labels, standard.

Handling Semantics in Information

Exchange - An Introduction to XML Good information is hard to get. It is even more difficult, to use it. This citation is even more valid for the information age with many billions of Web page and in these times of the semantic web. The main issue for Web users is not getting information. Rather the principal task for the user of the Web is to separate relevant from irrelevant information. Humans can use their knowledge and subtle- clues when they face a long list of results from a search engine. Conversely, when there is automated processing of information, large numbers of unreliable search results are often a serious problem.

Opening Vignette

Will XML be the ultimate platform? Or will it be the next EDI? I hear it's going to cure cancer," says Tim Bray, its co-creator. "It's going to do my dishes, I hear," says Anne-Marie Keane, Staples' vice president of B2B e-commerce. Behind the Hip jokes lies XML - a syntax thai underpins a growing list of more than 300 nascent data standards. MathML, for instance, will make il possible lo manipulate advanced mathematical equations on a Web page. Spacecraft Markup Language standardizes databases that operate telemetry and mission control. And then there's MeatXML, a comical name for a serious effort to create a universal meat and poultry supply chain standard. With XML going in so many directions at once, you can't blame CIOs for being confused. The hyperbole often makes XML sound like a salve for all pain. Finding the truth behind the lales takes some digging. Technologically, XML is a giant leap for IT. It can drastically reduce development time while making data transfer over the Internet simple. If nurturd properly, it may even become the ASCII text of online business - ubiquitous and assumed. Or it could become the next EDI, fractured under die pressure of vendor self-iiiteresl. One diing is certain: for XML to reach its full potential, CIOs will have to lake an active role in forcing their partners, iheir vendors and even their competitors toward a radically more open computing model than what existed before.

Annelie Breton is a domain consultant in taxation company which is provides Online eTDS Software, USB Token for Digital Signature, xbrl software and various utility product for chartered accountant, Company secretary and corporates.

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As per General Circular number 01/2013 dated 15.01.2013, time limit to file financial statements in XBRL mode (for the financial year commencing on or after 01.04.2011) without any additional fee has been extended upto 15th February 2013 or within 30 days of AGM of the company, which ever is later.

The audited statement i.e. Balance sheet and Profit and Loss Account submission which is in form XBRL is extended upto 15th February 2013 by General Circular No. 01/2013 dated 15.01.2013 for Financial year 2011-12. Before this circular the due date to filing Balance Sheet and Profit & Loss Account is 15th Jan, 2012.

Filing of Balance Sheet and Profit and Loss Account in extensible Business Reporting Language (XBRL) mode for the financial year commencing on or after 01.04.2011 GENERAL CIRCULAR NO.  01/2013 dated 15.01.2013 In continuation of the Ministry's General Circular Nos: 16/2012 dated 6-7-2012 and 34/2012, dated 25-10-2012 on the subject cited above, it is stated that the time-limit to file the financial statements in the XBRL mode without any additional fee/penalty has been extended up to 15th January 2013 or within 30 days from the date of AGM of the company, whichever is later. 2. All other terms and conditions of the General Circular No: 16/2012, dated 6-7-2012 will remain the same.

Download eXBace is an advanced xbrl software for filing financial statements before the Due Dates with Accurate Information and Improved Data Accuracy.

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[TO BE PUBLISHED IN THE GAZETTE OF INDIA, EXTRAORDINARY,

PART II, SECTION 3, SUB-SECTION (ii) of dated the 15th

JANUARY, 2013]

GOVERNMENT OF INDIA

MINISTRY OF FINANCE

DEPARTMENT OF REVENUE

[CENTRAL BOARD OF DIRECT TAXES]

NOTIFICATION

New Delhi, the 15th

S.O. 169 (E).— In exercise of the powers conferred by sub-section (2) of section
200A of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby
makes the following scheme for centralized processing of statements of tax deducted at
source, namely:—

January, 2013

1.  Short title and commencement.— (1) This scheme may be called the Centralized Processing of Statements of Tax Deducted at Source Scheme, 2013.

(2) It shall come into force on the date of its publication in the Official Gazette.

2. Definitions.— (1) In this scheme, unless the context otherwise requires,—

(a) “Act” means the Income -tax Act, 1961 (43 of 1961);

(b)    “Assessing Officer” means the Assessing Officer who is  ordered or directed under section 120 of the Act to exercise or perform all or any of
the powers and functions conferred on, or assigned to, an Assessing Officer under  Chapter XVII of the Act;

(c) “ authorized agency” means the person  authorized by the Director General to receive the statement of tax deducted at source or correction
statement of tax deducted at source;

(d) “Board” means the Central Board of Direct Taxes constituted under the Central Boards of Revenue Act, 1963 (54 of 1963);

(e) “Cell” means the Centralised Processing Cell having jurisdiction over such statements of tax deducted at source as may be specified by the Board;

(f) “Commissioner” means the Commissioner of Income-tax in charge of the Centralised Processing Cell;

(g) “correction statement of tax deducted at source” means the statement furnished for rectifying any mistake or  to add, delete or update the information   furnished  in the statement of tax deducted at source furnished under sub-section (3) of section 200 of the Act;(h)  “deductor” means a person deducting tax in accordance with the provisions of Chapter XVII of the Act;

(i) “Director General” means the Director General of Income-tax (Systems) appointed as such under sub-section(1) of section117 of the Act;

(j) “portal” means the web portal of the authorized agency or the web portal  of the Cell, as the case may be;
(k) “statement of tax deducted at source” means statement of tax deducted at source furnished under sub-section (3) of section 200 of the Act.
(2) The words and expressions used herein but not defined and defined in the Act shall have the meaning respectively assigned to them in the Act.

3. Centralized Processing Cell.— The Board  may  set up  as many Centralized Processing Cells as it may deem necessary and specify their respective jurisdictions.

4. Furnishing of correction statement of tax deducted at source.— (1) A deductor shall furnish the correction statement  of tax deducted at source in the  form specified by the Director General—

(a) at the authorized agency through electronic mode; or (b) online through the  portal.
(2)  The correction statement referred to in  sub-paragraph (1) shall be furnished under digital signature or verified through a process in accordance with the procedure, formats, and standards specified by the Director General.

5. Processing of statements.— (1) The  Cell shall process   the  statement  of tax
deducted at source furnished by a deductor in the manner specified under subsection (1) of  section 200A of the Act after taking into account the information contained in the correction statement of tax deducted at source, if any,
furnished by the deductor before the date of processing.

(2) The Commissioner may—

(a) adopt appropriate procedure for processing of the statement of tax deducted at source; or
(b) decide the order of priority for processing of the statement of tax deducted at source based on administrative requirements.

6. Rectification of mistake.— (1) An Income-tax authority of the Cell may, with a view to rectifying any mistake apparent from the record under section 154 of the Act,  on its  own motion or on receiving an application from the  deductor,
amend any order or intimation passed or sent by it under the Act.

(2) An application for rectification shall be furnished in the form  and manner specified by the Director General.
(3) Where a rectification has the effect of reducing the refund or increasing the liability of the deductor, an intimation to this effect shall be sent to the deductor electronically by the Cell and the reply of the deductor shall be furnished in the form and manner specified by the Director General.
(4) Where an amendment has the effect of reducing a refund already made or increasing the liability of the deductor, the order under section 154 of the Act passed by an Income-tax authority of the Cell shall be deemed to be a notice of demand under section 156 of the Act.
                                             
7. Adjustment against outstanding tax demand.— Where a refund arises from the processing of a statement under this scheme, the provisions of section 245 of the Act shall, so far as may be, apply.

Appeal—

(1) Where a statement of tax deducted at source is processed at the Cell, the appeal proceedings relating to the processing of the statement shall lie with the Commissioner of Income-tax (Appeals) having jurisdiction over the
Assessing Officer who has jurisdiction over the deductor and any reference to
commissioner of Income-tax (Appeals) in any communication from the Cell shall mean such jurisdictional Commissioner of Income-tax (Appeals).

(2) The Assessing Officer who has jurisdiction over the deductor shall submit the remand report and any other report to be furnished before the Commissioner of
Income-tax (Appeals) and an order, if any, giving effect to appellate order shall be passed by such Assessing Officer.

9. No personal appearance at the Cell.— (1) No person shall be required to appear personally or through  authorised representative before the authorities at the
Cell in connection with any proceedings.

(2) The Cell may call for such clarification, evidence or document as may be required for the  purposes of the processing of statement of tax deducted at
source or for the purposes of the rectification of any order or intimation passed or sent by the Cell under the provisions of the Act. (3) The deductor shall furnish the reply to any communication  under subparagraph (2) in such format as may be specified by the Director General.

10. Service of notice or communication.—(1) The service  of a notice or order or intimation or any other communication by the Cell may be made by delivering or
transmitting a copy thereof to the deductor,—

(a) by electronic mail; or

(b)by placing such copy in the registered electronic account of the deductor on the portal of the Cell; or
(c) by any  mode mentioned in sub-section (1) of section 282 of the Act.

(2) The date of posting of  any communication under sub-paragraph (1) in the electronic mail or electronic account of the deductor in the portal of the Cell shall be
deemed to be the date of service of such communication.

(3) The intimation, orders and notices shall be computer generated and need not carry physical signature of the person issuing it.

11. Power to specify procedure and processes.— The Director General may specify procedures and processes, from time to time, for effective functioning of the Cell in an automated and mechanised  environment, including specifying the procedure, formats, standards and  processes in respect of the following matters, namely:—

(a) form of correction statement of tax deducted at source;
(b) the manner of verification of correction statement of tax deducted at source;
(c) receipt of correction statement of tax deducted at source;
(d) form of rectification application;
(e) the manner of verification of rectification application;
(f) receipt and processing of rectification applications in the Cell;
(g) the mode and format of the acknowledgment to be issued by the Cell for the receipt of any document;
(h) the mode of authentication of any document or information submitted to the Cell, including authentication by digital signature or electronic signature;
(i) validation of any software used for electronic filing of correction statement of tax deducted at source or rectification application;
(j) provision of web portal facility including login facility, tracking status of correction statement of tax deducted at source or statement of tax deducted at source, display of relevant details of tax deduction or refunds to the taxpayer or deductor, as the case  may be, and facility of download of relevant information;(k) call centre to answer queries and provide taxpayer services, including outbound calls to a deductor requesting for clarification to facilitate the processing of the statement of tax deducted at source filed; provision of grievance redressal mechanism in the Cell;
(m)managing tax administration functions such as receipt, scanning, data entry, processing, storage and retrieval of statement of tax deducted at source and documents in a centralised manner or receipt of paper documents through authorised intermediaries.

Courtesy Income Tax India

[Notification No.  03 /2013        [F.No. 142/39/2012-SO (TPL)]

(RAJESH KUMR BHOOT)

Director (TPL-III)

About: If you required Online TDS Filing Software, XBRL Software, Gemalto USB Tokens for Digital Signature, Work Management Software for your business you can go through us.

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eXBace highlights in MCA recognized XBRL Software Vendor List

eXBace by KDK Softwares(I) Pvt Ltd is a XBRL conversion software which is recognized and covered in the MCA XBRL Software vendor list released by Ministry of Corporate Affairs (MCA), Government of India. This list will surely worthy for representatives from various companies in order to identify software vendors for their XBRL conversion services.

Last year, MCA had added all XBRL Software vendors name in the list who actually intended to register with the MCA. However, for the current year, MCA has published the list of solution providers who use their own software for XBRL conversion, and have a validated sample instance document available online. This is on par with the MCA’s objective to ensure that only those solution providers who can assure high quality XBRL output are published in the list of XBRL vendors.

eXBace software is user friendly XBRL solutions for converting and filing financial information of the company in XBRL format as per MCA mandate. The software has been designed by KDK Softwaress professionals with accounting as well as XBRL technology expertise; hence it is well-equipped to meet the regulatory compliance requirements laid down by the MCA. This is one stop complete XBRL software - On Document editing/Taging, Quick Viewing, Advance Validating and Finally extensible reporting.

eXBace follows the Mantra “BETTER and FASTER”

Better – Accurate, Easy to use, Import and Export facility to almost all formats
Faster – No Rekeying, Instant User Access and most efficient reports for faster information retrieval

Availability of eXBace

• Standalone (On Premises) - You can work offline on your machine, i.e. does not necessarily require Internet connection to function.
• SAAS (Software as a Service) - Web Based eXBace being also available in web based, makes it compact easy access anywhere everywhere.

Makes you global, being Local

• It gives you the centralized data secure and easy to backup. Information is accessible anywhere in the world.
• Online training can be completed at user’s own time and place Employees located at different locations, on the road or even abroad; all have direct access to current information.
• No installation process.
• No admin rights required finally, a world where the network administrator in the company does not have to approve the installation of your software.
• Available anywhere, anytime.
• Less environmental conflicts there are certainly going to be a lot less bugs in Web based software, due to the fact that it is not depending on any of the hardware.
• Enables social possibilities: Give the ability to share your work in real time.

KDK Softwaress develop solutions for you in Taxation Domain in a wide array for almost all Tax Compliance like TDS/TCS, Income Tax, Service Tax and PDF Signer for singing your PDF files with DSC. MCA filing we have solution like ROC, Fixed Asset Registrar and XBRL software also. Covering of all tax compliance solution, we have one office management tool with the name of Office Stem. We at KDK don’t settle for less. We ensure that you get right first time every time. The zeal for continuous improvement is still very much in the KDK Softwares which drives them for further innovation and improvement in their products and services in the already crowded market of software development companies. It is this spirit and work which has set the company stand apart from the competition in many areas.

For More Information Visit:- http://www.exbace.com/default.aspx
Shyam Nagar, Jaipur 302019,
Rajasthan, INDIA +91-141-4123456

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MCA XBRL Validation Tool (Final Version)

Final version of the MCA XBRL Validation Tool (for Financial Statements based upon new Schedule VI of the Companies Act, 1956) has been released. XBRL filings of financial statements for accounting year commencing on or after 01.04.2011 have been enabled on MCA website with effect from 14.10.2012. Stakeholders are also advised to refer to the ‘Filing Manual’ available on the XBRL portal for filing the financial statements in XBRL format.

Source :http://www.mca.gov.in/XBRL/

XBRL Filing Software provider in India

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