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    December 20, 2009
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    Advance tax collection by top companies increases in the quarter, raising government advance-tax receipts and signalling stronger tax compliance.
    Increase in advance tax collections from the top 90 corporate advance-taxpayers was recorded in Q3, with aggregate Q3 payments rising to Rs 12,881 crore from Rs 10,404 crore year on year and an incremental Rs 2,477 crore collected. Sixty-one companies paid more in Q3; 34 paid 100% or more of assessed advance tax. For the first three quarters the group's cumulative advance-tax payments rose to Rs 33,358 crore from Rs 27,197 crore, with 68 companies paying more year to date and 22 paying less.
    December 2, 2009
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    Trade defence measures protect domestic industry via anti-dumping and safeguard duties against injurious imports.
    Where imports are priced below normal value and cause injury, domestic industry may seek imposition of anti-dumping duties; where increased imports cause serious injury or threaten market disruption, domestic industry may seek imposition of safeguard duties. The Customs Tariff Act provides relief consistent with international agreements on dumping, subsidies and safeguards, and the Central Government has power under the foreign trade statute to restrict imports.
    December 2, 2009
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    Direct tax collections rose modestly overall, with personal income tax up but corporate tax falling in November.
    Net direct tax receipts for the first eight months rose by 3.71 percent year on year, with corporate tax up modestly and personal income tax (including related levies) up 4.53 percent. November aggregate collections were broadly stable year on year, reflecting a substantial month on month increase in personal income tax contrasted with a pronounced decline in corporate tax. Securities Transaction Tax collections for April-November increased modestly over the prior year.
    November 30, 2009
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    Diplomatic missions: self certified Form 15CA suffices for consular remittances; Form 15CB not required under exemption.
    Diplomatic missions remitting consular receipts abroad must submit a self certified Form 15CA to the remitting bank and are not required to obtain Form 15CB; this rests on the exemption for mission fees and charges under Article 28 of the schedule to section 2 of the Diplomatic Relations (Vienna Convention) Act. Missions must upload remittance details electronically in Form 15CA, print and sign the acknowledged form, submit it in duplicate to the Reserve Bank of India or an authorized dealer, which will forward a copy to the Assessing Officer.
    November 28, 2009
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    EET taxation of savings: proposal shifts tax to withdrawal, delaying DTC Bill until Budget Session.
    The Direct Tax Code proposes replacing the Income Tax Act by shifting many savings schemes from the current EEE treatment to an EET taxation framework taxing withdrawals; stakeholder resistance and unresolved issues including MAT have delayed introduction, and the bill will be tabled in the Budget Session after further consultations and review by the law ministry.
    November 25, 2009
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    Automation of indirect tax administration enables centralized e-registration, e-filing, and electronic processing of refunds and disputes.
    Automation of Central Excise and Service Tax establishes a centralized web-based system that enables electronic registration, filing and scrutiny of returns, electronic processing of refund claims and permissions, maintenance of assessee running accounts, automated reporting, risk-based audit selection, export processing, and dispute-resolution workflows. The registration regime distinguishes new, existing, non-assessee and LTU clients with email-based TPIN/password procedures and mandatory PAN for certain refunds. Operational controls require permanent usernames, periodic password changes and validated email records; the system provides offline utilities, helpdesk support and specified technical requirements for access.
    November 24, 2009
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    Dispute Resolution Panel mechanism enables taxpayers to seek binding directions on draft assessments before appeal rights to the tribunal.
    Notification establishes the Dispute Resolution Panel (DRP) under section 144C to review proposed variations in returned income; eligible taxpayers (notably foreign companies and domestic companies with transfer pricing issues) may apply to the three-member DRP collegium within one month of receiving a draft assessment order for directions to the assessing officer, and the DRP's directions are binding on the assessing officer though the taxpayer may still appeal the assessment order to the Income Tax Appellate Tribunal.
    November 20, 2009
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    Income tax search and seizure: evidence from operations informs assessment and appeals and shapes final legal consequences.
    Searches and seizures under the Income Tax Act, assisted by another enforcement agency, targeted lockers, bank accounts and premises under proprietary orders; seized materials are under investigation, with some prima facie indications of hawala transactions and properties exceeding declared income. Evidence from these operations is used in assessment and reassessment proceedings and attains finality only after completion of assessments and appeals, after which appropriate legal action may follow against those found culpable.
    November 17, 2009
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    Audit report compliance under section 44AB upheld where report obtained within extended time; penalty under section 271B not imposed
    The CBDT circular dated June 19, 1985, binding under section 119, provided that obtaining the audit report within the period recognized by the circular constitutes compliance with the tax audit requirement; where an assessee obtained the audit report in late September after seeking extensions, deposited tax before filing and filed the return within the extended period, that sequence sufficed for compliance and the penalty for failure to get accounts audited was not imposable.
    November 16, 2009
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    Taxability of non-residents: withdrawal of CBDT circulars removes direct reliance, requiring assessment under law and treaties.
    Withdrawal of CBDT circulars rescinds administrative guidance on the taxability of non-residents-guidance that had limited taxable income to profits attributable to Indian operations, excluded certain principal-to-principal sales and export commissions, and exempted procurement offices buying in India solely for export. The withdrawal prevents direct reliance on those circulars and strengthens revenue arguments in pending disputes, requiring taxpayers to determine taxability by reference to the Income Tax Act, applicable tax treaties and judicial precedents rather than withdrawn administrative instructions.
    November 12, 2009
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    Foreign Trade Policy focused on export growth through incentives, market access and trade facilitation to revive industry.
    The New Foreign Trade Policy, 2009-14, prioritises export revival through fiscal incentives, institutional reforms, procedural rationalisation and sustained export promotion schemes focused on employment intensive sectors. Policy measures aim to diversify markets, enhance market access including via ASEAN, consider restoration of income tax benefits for exports, and link incentives to job protection. Trade facilitation is being advanced by a committee to reduce transaction costs and port delays, alongside emphasis on a rule based global trade regime and completion of WTO negotiations.
    November 5, 2009
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    Direct tax collection growth slowed due to higher tax refunds, while corporate and personal tax trends diverged.
    Net direct tax collections for the first seven months showed modest growth with corporate receipts outpacing personal income tax, but substantially higher tax refunds materially constrained net collection growth; October collections remained positive with stronger personal tax monthly growth, weaker corporate monthly receipts, and marginal rise in Securities Transaction Tax over the April-October period.
    November 5, 2009
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    Direct Tax Code reform: stakeholder-led revisions to MAT, GAAR, APAs and tax base rationalisation to simplify and stabilise taxation.
    The Government will comprehensively review and modify the draft Direct Tax Code after stakeholder consultations, focusing detailed examination on nine critical areas including Minimum Alternative Tax based on gross assets, Capital Gains Taxation for non-residents, Income Tax interaction with Double Taxation Avoidance Agreements, the proposed General Anti-Avoidance Rule, taxation of foreign companies via effective management control, taxation of charitable organisations, shift from EEE to EET, treatment of self-occupied property, and taxation of salaried employees; proposed reforms include tiered personal tax slabs, a 25% corporate rate, Advance Pricing Agreements, and rationalisation of deductions and exemptions.
    October 30, 2009
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    Withholding tax liability asserted under section 201 for failure to deduct tax on cross-border share transfer; show-cause required.
    A statutory show-cause notice was issued to Vodafone International Holdings BV under section 201(1) and section 201(1A) alleging failure to deduct tax at source on a cross-border payment for transfer of interests in an Indian company, asserting the Department's jurisdiction to proceed against the foreign payee and requiring a response by the specified compliance date.
    October 24, 2009
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    Section 9 tax exposure: withdrawal of circular removes arms length safe harbour, widening tax reach over foreign BPO parent income.
    Withdrawal of cited circulars eliminates an administrative safe harbour and permits broader attribution of income to foreign parents under Section 9-style income sourcing rules by treating BPOs as a business connection. Arms length payments will no longer automatically prevent assessments of income deemed to arise from Indian activities. The step also removes related protections for export commission and agency remuneration, enhancing the tax authority's ability to claim profits attributable to on shore service operations and increasing transfer pricing and permanent establishment exposure for foreign companies.
    October 23, 2009
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    Taxation of retirement benefits under the draft Direct Taxes Code remains under review; proposals are illustrative and consultative.
    Draft Direct Taxes Code proposals are illustrative and open to consultation; seven critical areas-including taxation of retirement benefits-have been identified for resolution. Controversial elements such as taxation of retirement savings, removal of housing loan incentives, and changes to the Minimum Alternate Tax will be addressed before the Code is finalised and implemented through the appropriate future finance legislation.
    October 12, 2009
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    Tax treatment of foreign tour expenses: business nexus versus personal benefit determines deductibility and assessability of spouse travel.
    Whether foreign travel expenses borne by a company for a director's wife are deductible or taxable turns on a factual twofold test: existence of a demonstrable business nexus and whether the expenditure confers a gratuitous personal benefit. If a direct business purpose is shown, the expense may be treated as business expenditure; if gratuitous and without obligation, the value is treated as a perquisite assessable in the hands of the spouse.
    October 9, 2009
    Show AI Summary
    General Anti-Avoidance Rule under review alongside other Direct Taxes Code reforms to refine tax base and compliance.
    Direct Taxes Code reform now targets seven critical areas for detailed examination: Minimum Alternative Tax based on gross assets; Capital Gains taxation for non-residents; the Income Tax Act's interaction with Double Taxation Avoidance Agreements; the General Anti-Avoidance Rule; effective management control and taxation of foreign companies; taxation of charitable organisations; and the shift from an EEE to an EET taxation system, with further steps contingent on a comprehensive review of the draft Code and stakeholder inputs.
    October 6, 2009
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    Phishing alert: fraudulent refund emails request credit card details; do not respond to such communications.
    Phishing emails impersonating the Income Tax Department inform recipients of tax refunds and solicit credit card details; the Income Tax Department does not send refund-related emails or request credit card information. Taxpayers are warned not to respond to such messages and are put on notice that providing information in reply is at their own risk, as these communications are fraudulent impersonations using deceptive sender addresses.
    October 6, 2009
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    Direct tax collections rise as corporate receipts and advance tax improve despite higher tax refunds constraining net growth.
    Net direct tax collections in the first half showed a modest increase driven by stronger corporate tax receipts and improved advance tax, while higher tax refund outgo substantially reduced net growth. Securities transaction tax recorded marginal positive growth for the April-September period. Advance tax moved from negative growth in the first quarter to positive net growth after second-quarter instalments, with corporate advance tax reversing earlier weakness and improving notably in the second quarter.

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      Automation of Central Excise & Service Tax

      November 25, 2009

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      Welcome to the world of convenience @ ACES. Automation of Central Excise & Service Tax (ACES), the new centralized and web-based software application of CBEC is now available to you. It can be accessed at http://www.aces.gov.in. It is designed to provide you an electronic interface with the department and aims at reducing paper work, visits to the departmental offices and improving transparency, accountability and efficiency in indirect tax administration in India.

      Modules@ACES

      It comprises the following modules:

          · Access Control of Users (ACL) for departmental users

          · Registration (REG): Registration of Central Excise & Service Tax Assesses

          · Returns (RET): Electronic filing of Central Excise & Service Tax Returns and their scrutiny

          · Refund (REF): Electronic filing and processing of Refund Claims

          · CLI: Electronic filing and processing of claims, intimations and permissions including Special Procedures

          · Provisional Assessment (PRA): Electronic filing and processing of request for provisional assessment

          · Assessee Running Account: Information of credits and debits under the Current Account and CENVAT Credit Account, liabilities (confirmed and unconfirmed demands) and status of Bonds

          · Dispute Resolution (DSR): Creation of case portfolios, Show Cause Notices, Personal Hearing Memos, Adjudication Orders, on line filing of Appeals with Commissioner (Appeals), Appellate Orders, Review and related processes

          · Automated Report Generation

          · Audit Module: Selection of units based on risk parametres

          · Export Module: Processing of export-related Documents

      Benefits@ACES

          · Online registration and amendment of registration details

          · Electronic filing of documents such as Returns, Clauses, Intimations and Permissions

          · Online tracking of the status of applications, claims, and permissions

          · Online facility, to view documents like registration certificate, Returns, SCN, Order-in- Original etc.

          · Internal messaging system for faster communication

          · Application accessible from anywhere, anytime (24x7) through the Internet

          · Online authentication of PAN with the Income Tax database

          · Assistance of 'Know your location' for choosing correct jurisdictional office

          · Online self learning tutorials (LMS), Users Manuals & FAQ's for help in using ACES

      Registration@ACES

      (a) New Assessee

      If you are a new assessee, login to ACES at http://www.aces.gov.in and choose the Central Excise or Service Tax link as the case may be Submit the form "Registration with ACES", by furnishing a self-chosen user ID and e-mail ID. System checks for availability of the chosen User Id and generates a password. It will be sent to your e-mail from [email protected]

      Login again and proceed with the statutory registration with Central Excise or Service Tax as the case may be, by filling- in Forms A-l, A-2 or ST-1. For security reasons, change password immediately

      (b) Existing Assessee

          · If you are an existing assessee, you need not take fresh registration with the department. You have to only register with ACES

          · A mail will be sent from [email protected] .in to your e-mail ID, as available in the existing registration data base, indicating a TPIN and password. The mail will contain a hyperlink to the website, by clicking it, you can proceed to register with ACES

      (c) Non-Assessee

          · This category of registration is given in ACES to any individual, firm or company, who are not assessees but who require to transact with the Central Excise or Service Tax Department, such as

              Ø  Merchant Exporter

              Ø  Co-noticee

              Ø  Refund Applicant other than registered taxpayers

              Ø  Persons who have failed to obtain CE/ST registration as required under the law and against whom the Department has initiated proceedings and

              Ø  Persons who are required to tender any payment under CE/ST laws, rules & regulations

          · Where such persons desire to seek non-assessee registration they have to follow the same steps as in the case of a new assessee

          · In case the user wants to take such a registration for claiming any refund or rebate it is mandatory to provide a valid PAN A Non-assessee registration can also be given by the designated officer of the Commissionerate

          · The Non-assessees are not required to file any tax returns

      (d) Large Tax Payer Unit (LTU) Client

          · If you want to opt for LTU scheme, submit the consent form to your jurisdictional LTU officer. It will be processed off-line and then uploaded to ACES

          · All pending items of work will be transferred to the concerned LTU automatically and intimation will be sent

      · If you are approved as an LTU client, and want to register a new unit, submit the registration application in ACES. The system will automatically attach the new unit with the concerned LTU

          · On the basis of PAN details in the registration form

          · If you are an existing LTU client, the process of registration is same as explained for existing assesses

      (e) Important

          · Ensure that registration database in the exiting SACER/SAPS systems is updated to include your valid and current e-mail ids and Constitution of Business. Please contact your jurisdictional officer for updation

          · After Introduction of ACES in your Commissionerate, if you do not receive the e-mail, you should contact the jurisdictional Range Officer to confirm/ modify your e-mail ID, after which the system will send you a new e-mail communicating the TPIN and password

          · While choosing  Username remember that username once selected is permanent and cannot be changed

          · Change Passwords at regular intervals

          · Check your bulk/spam folder periodically for any communication from ACES

      e-filing@ACES

      All returns such as ER-1, ER-2 etc. in Central Excise and ST-3 in Service Tax can be prepared and filed online through ACES

      Offline return preparation utilities are also available at ACES website for download which can be used of preparing and uploading the returns at your convenience

      Always use the latest version of offline utility

      Service Desk@ACES

      In case of any difficulty in accessing or using the ACES Application, Assesses can seek help of the ACES Service Desk by sending e-mail to [email protected] or calling up national toll-free number 1800 425 4251 on any working day from Monday to Friday between 9 AM and 7 PM

      Tech-Space@ACES

          To use ACES following minimum systems requirements are prescribed:

          Processor: Intel Pentium III and Higher

          RAM: 256 MB and higher

          HDD: 80 GB and more

          Web Browser: IE 6.0 and above, Netscape 6.2 and above

          MS Excel 2003 and above for using offline utilities

          Sound Card, Speakers/Headphones, Colour Monitor for using

          Learning Management System (LMS)

      Topics

      ActsIncome Tax