Corporate Updates – 20-07-2017

CBDT – GST:

The Central Board of Direct Taxes (the Board) had earlier issued Circular No. 1/2014 dated 13.01.2014 clarifying that wherever in terms of the agreement or contract between the payer and the payee, the Service Tax component comprised in the amount payable to a resident is indicated separately, tax shall be deducted at source on the amount paid or payable without including such Service Tax component. In the light of the fact that even under the new GST regime, the rationale of excluding the tax component from the purview of TDS remains valid, the Board hereby clarifies that there is no need to deduct TDS on GST component if shown separately on invoice. Wherever in terms of the agreement or contract between the payer and the payee, the component of ‘GST on services’ comprised in the amount payable to a resident is indicated separately, tax shall be deducted at source, on the amount paid or payable without including such ‘GST on services’ GST for these purposes shall include Integrated Goods and Services Tax, Central Goods and Services Tax, State Goods and Services Tax and Union Territory Goods and Services Tax. Further, for the purposes of this Circular, any reference to ‘service tax ‘ in an existing agreement or contract which was entered prior to 01.07.2017 shall be treated as ‘GST on services’ with respect to the period from 01.07.2017 onward till the expiry of such agreement or contract.

SEBI:

SEBI has issued Circular regarding Disclosure of divergence in the asset classification and provisioning by banks. As per a latest RBI circular, banks are required to disclose cases of divergence in the asset classification and provisioning in a prescribed format. The Notification requires the disclosures to be made in the Notes to Accounts in the ensuing Annual Financial Statements published immediately following communication of such divergence by RBI to the bank. Banks shall disclose, the stock exchanges divergences in the asset classification and provisioning; the additional provisioning requirements assessed by RBI exceed 15 percent of the published net profits after tax and the additional Gross NPAs identified by RBI exceed 15 percent. Further, the disclosures shall be placed as an Annexure to the annual financial results filed with the stock exchanges in accordance with clause (d) of sub-regulation (3) of Regulation 33 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

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