Related-party valuation controls tighten provisional assessment and SVB inquiry procedures, emphasising documentation and bank guarantees.
The Special Valuation Branch (SVB) investigates whether related party relationships or agreements (technical collaboration, royalties, license fees or other payments) have influenced imported goods' invoice value. Cases are referred to SVB by importer declaration, intelligence, or commissioner order; certain low impact categories are excluded. Upon referral, provisional assessment is carried out, records are transferred to SVB, case numbers assigned and inquiries conducted with document exchange and prescribed timelines. SVB prepares an Investigation Report quantifying any influence on transaction value and forwards findings for finalisation, with show cause notices and adjudication where influence is found. (AI Summary)

Valuation for captive consumption: notional inter unit debit adjustments cannot be added to production cost for duty assessment.
IDSC/ICNC debit notes raised to reconcile intra group invoice values with market prices are notional segment reporting adjustments and cannot be added to raw material cost for computing assessable value for captive consumption. The valuation regime distinguishes value (the duty base) from cost (actual production expenditure), so corporate overheads, deemed profit elements and notional mark ups used for internal or transfer pricing purposes are excluded from production cost unless they reflect real expenditures. (AI Summary)

Income tax changes broaden deductions, revise corporate surcharge, and defer GAAR implementation to a later date.
Income tax measures revise personal exemptions and deductions, introduce additional housing loan interest relief for specified loans with carry forward, expand the Rajeev Gandhi equity savings concession to equity funds with an increased income ceiling, and adjust withholding tax rates and concessions for non resident investment and specified foreign dividends. Corporate surcharges are increased, buyback distributed income is taxed at a specified rate payable by companies while buyback consideration is exempt for shareholders, and investment incentives for large capital expenditure provide a limited deduction subject to holding and sunset conditions. (AI Summary)

Cost accounting compliance applies to real estate and construction, requiring maintenance of cost records and filing of compliance reports.
The Ministry reconfirmed that the Companies (Cost Accounting Records) Rules 2011 apply to construction and real estate activities (including development projects, infrastructure, BOT/BOOT, EPC work and overseas projects) unless exempted. Companies meeting any of the specified financial thresholds or having listed securities must maintain cost records in accordance with Cost Accounting Standards, reconcile them with audited financial statements, obtain and board approve a Cost Accountant's report with annexures, and file the compliance report with the Ministry within the prescribed period; contractors paid only conversion charges are exempt. (AI Summary)

Cost record compliance extends to media processing activities, requiring maintained cost records and statutory filing obligations.
Cost record obligations under the Companies (Cost Accounting Records) Rules, 2011 extend to media activities described as processing activity where companies meet prescribed applicability thresholds. Companies in scope must keep contemporaneous cost records from the financial year commencing on or after April first, two thousand eleven, enabling calculation of per unit cost of production or operations, cost of sales and margins on periodic bases, prepare programme level and consolidated cost records, reconcile with financial records, obtain a Compliance Report in Form B signed by a cost accountant, and file Form A with attachments with the Ministry within the statutory filing timeframe. (AI Summary)

One Person Company and mandatory Company Secretary reshape corporate governance, introducing KMP duties and secretarial audit obligations.
The Bill introduces a consolidated regulatory framework that creates the One Person Company and a statutory regime for Key Managerial Personnel, mandating Company Secretary appointments, setting directors' duties, establishing Independent Directors with term limits and codes, enabling board meetings by video-conferencing with safeguards, and instituting statutory Secretarial Standards and Secretarial Audit with reporting and penalties. (AI Summary)

Cost record maintenance requirement now covers real estate construction, triggering statutory compliance and auditor reporting obligations.
The Rules extend maintenance of cost records to real estate and construction activities qualifying as processing activity; applicable companies must prepare project-level cost records, reconcile them with financial accounts, prepare and obtain board approval for the annexure to the Compliance Report, and file Form A with the Compliance Report (signed by a Cost Accountant). Statutory auditors must verify whether such cost records have been made and maintained and state so in their CARO comment. The Ministry's circular excludes contractors paid only job-work/conversion charges and certain non-corporate or smaller unlisted entities. (AI Summary)

Widened definition of inter-connected undertakings expands taxable entities and strengthens excise enforcement including higher penalty thresholds and arrest powers.
Budget 2012-13 widens the definition of Inter-connected Undertakings to include more entities, raises the monetary threshold for excise offences in section 9, and treats most excise offences as non-cognizable except those carrying three years' imprisonment or more. (AI Summary)

Income tax rate restructuring affects taxpayer liability and introduces broader withholding, collection, and indirect tax changes.
Income tax rates were restructured into multiple slabs, adjusting taxpayer marginal rates. Withholding and collection rules were broadened: new TDS/TCS requirements on interest to certain non residents, on immovable property transfers to non residents above thresholds, and 1% collection on specified bullion, jewellery and mineral transactions; professional payments to directors were brought within withholding scope. The AMT was extended to non company taxpayers claiming certain deductions, with an adjusted total income threshold; the Direct Tax Code implementation was deferred. Indirect tax changes include a higher service tax rate, excise and customs duty adjustments, sectoral exemptions, and proposals on FDI and external commercial borrowings. (AI Summary)

Cost audit applicability expanded; new appointment, reporting and compliance procedures impose specific filing and audit obligations.
The rules expand applicability of cost audit and cost accounting to companies meeting specified net worth, turnover or listing thresholds and to named industry sectors; require maintenance of unit- and product-level cost records for prescribed historical periods; mandate Board approval and cost accountant certification of Annexures; impose electronic pre-appointment filings and auditor notifications; require submission of cost audit and compliance reports in prescribed forms within statutory timelines; and envisage penalties for defaults by auditors, companies and defaulting officers. (AI Summary)

Cost accounting compliance: new rules focus on internal cost records, benchmarking and targeted external audits for priority sectors.
MCA notifications recalibrate cost accounting obligations by limiting product specific cost rules to regulated sectors while imposing a general cost accounting rule elsewhere requiring cost information to meet minimum standards set by the Institute of Cost Accountants' Cost Accounting Standard Board. The regime distinguishes sectors needing externally attested cost audits from those where an internal cost accountant may file a board compliance report, excludes financial accounting records as substitutes for cost records, and aims to benchmark existing systems against prescribed minimums to improve governance and resource utilisation transparency. (AI Summary)

Mandatory excise recordkeeping required for manufacturers and dealers, specifying general, cenvat and industry registers and jobwork.
Manufacturers and dealers must maintain specified excise registers including RG-1 (daily stock account), Form-IV (receipt/issue of raw material), Personal Ledger Account, invoice book, job work register and RG-23D for dealers; modvat/cenvat claimants must keep RG-23A and RG-23C parts for inputs and capital goods, records and challans for job work and capital goods movement. Industry-specific registers and Chapter X/independent processor records (RG-16, lot registers, Rule 57A deemed-credit records) are also prescribed. (AI Summary)