TAX NEWS

VOL.XXXIV I - GENERAL
Tax News

JANUARY-APRIL 2011

Nos.1 & 2

CONTENTS

Direct Taxes Sub-Committee Sales Tax and T.N. VAT Sub-Committee Free Consultancy Service on Sales Tax & T.N. VAT and Direct Taxes

II - DIRECT TAXES
Chambers Pre-Budget Memorandum for 2011-2012 Budget proposals for 2011-2012 -- Direct Taxes

III - TAMIL NADU VALUE ADDED TAX

Tamil Nadu Value Added Tax Rules 2007 -- Amendments to Tamil Nadu Value Added Tax Rules, 2007-- Amendment to Certain period of Extension of time for filing applications under the Tamil Nadu Sales Tax (Settlement of Arrears) Act, 2010

IV - ANDHRA PRADESH VALUE ADDED TAX

The Andhra Pradesh Value Added Tax Rules, 2005 -- Amendments to Rules The Andhra Pradesh Value Added Rules, 2005 -- Amendments to Rules AP VAT, 2005 -- issue of notification under sub-rule (2) of Rules 55 of AP VAT Act, 2005 -- inclusion of ceramic and Glazed Tiles under sensitive goods.

(For Private Circulation)

ANDHRA CHAMBER OF COMMERCE

TAX NEWS
PUBLISHED BY ANDHRA CHAMBER OF COMMERCE
CHENNAI OFFICE:

Velagapudi Ramakrishna Building,

23, Third Cross Street, West C.I.T. Nagar, P.B. No.3368, Nanadanam Chennai-600 035 GRAMS: TELCHAMBER PHONE: OFFICE: 24315277 Secy. (Per) 24315278 (Fax): 24315279 E.mail: [email protected] Web: www.andhrachamber.com

SECUNDERABAD OFFICE: T.G. Venkatesan Bhavan 60-2 & 603, Chenoy Trade Centre, VI Floor, 116, Park Lane, P.B.No.1716, Secunderabad-500 003 (A.P.) GRAMS: TELCHAMBER PHONE:27840844 Jt. Secy. Per:040-27840767 Fax: 040-27840767 E.mail: [email protected]

VISAKHAPATNAM OFFICE: Door No. 43-19-30, Venkataraju Nagar, Dondaparthy, Near TSN Colony, Visakhapatnam-530 016 (A.P.) GRAMS: TELCHAMBER PHONE:0891-2792220 Fax :0891-2792221 Email:[email protected]

(for Private Circulation only) (All correspondence relating to the publication may be addressed to CHENNAI office)

VOL.XXXIV

JANUARY-APRIL, 2011

Nos.1 & 2

I - GENERAL TAX NEWS: TAX NEWS published by the Chamber once in two months has entered the Thirtyfourth year of service to Members and Member Bodies of the Chamber in particular and industry and trade in general. While rededicating itself to the service of Members, Member Bodies and Industry and Trade in general in an ever-increasing measure, TAX NEWS conveys its HEARTY GREETINGS AND BEST WISHES FOR A HAPPY AND PROSPEROUS NEW YEAR, 2011. DIRECT TAXES SUB-COMMITTEE: Shri T.R.K. Tawker, F.C.A., Member, Executive Committee has been elected as Chairman of the Direct Taxes Sub-Committee and Shri N. Sivaprasad, F.C.A., has been elected as Co-Chairman. Members and Member Bodies are requested to forward from time to time their points/suggestions relating to Direct Taxes to the office of the Chamber for consideration of the Direct Taxes Sub-Committee. SALES TAX AND T.N. VAT SUB-COMMITTEE: Shri V.V. Sampathkumar, F.C.A., is the Chairman of the Sales Tax and T.N. VAT Sub-Committee of the Chamber and Shri T. Devanathan, A.C.A., is the Co-Chairman. The Sub-Committee examines from time to time points/ suggestions/ problems referred to it by the Members and Member Bodies on matters relating to Tamil Nadu General Sales Tax, Tamil Nadu Valude Added Tax, Central Sales Tax, Andhra Pradesh General Sales Tax and Andhra Pradesh Value Added Tax and recommends follow up action by the office o f the Chamber. Member and Member Bodies are advised to

forward to the office of the Chamber from time to time their points / suggestions regarding Value Added Tax and help the Sales Tax Sub-Committee and the Chamber to help them. FREE CONSULTANCY SERVICE ON SALES TAX & T.N. VAT AND DIRECT TAXES: Andhra Chamber is offering Free Consultancy Service at Chennai on Sales Tax for the past 44 years and Direct Taxes for the past 37 years. The Free Consultancy Service on Sales Tax and Direct Taxes is being offered at the Secunderabad office of the Chamber for the past 26 years. The Hon. Advisers of the Chamber on Sales Tax and Direct Taxes are present in the office of the Chamber at Chennai and Secunderabad between 11 A.M. to 12.30 P.M. on the second Saturday of every month for consultation by Members and Member Bodies. The consultation is absolutely free of charge. Our Hon. Advisers at Chennai are: Sales Tax & T.N. VAT : Shri V.V. Sampathkumar, F.C.A., Chartered Accountant Shri M.K. Kalyanasundaram Asst. Commr. of Comml. Taxes (Retd.) Shri V.V. Ramesh, B.Com., B.L., Advocate Shri P. Mohanasundaram, B.Sc., B.L. F.C.A. Chartered Accountant Smt. V. Sitalakshmi F.C.A., Chartered Accountant

Direct Taxes

Our Hon. Advisers at Secunderabad are: Direct Taxes : Shri D. Seetharamaiah, F.C.A., Chartered Accountant Shri P. Chiranjeevulu, M.Com., LL.B, Advocate Shri A. Durga Prasad, F.C.A., Chartered Accountant Shri Y. Sambasiva Rao, B.Com, Sales Tax Consultant

Sales Tax & AP VAT

II - DIRECT TAXES
CHAMBERS PRE-BUDGET MEMORANDUM FOR 2010-2011: Andhra Chamber in a communication dated January 20, 2010 addressed to the Honble Union Finance Minister submitted a Pre-Budget Memorandum on Direct and Indirect Taxes under copy to the Chairman, Central Board of Excise and Customs, Chairman, Central Board of Direct Taxes and Member-Budget, Ministry of Finance, Government of India. 4

The following were the highlights: The exemption limit for Personal Income should be raised to Rs. 3 lakhs having regard to the erosion in the value of the Rupee, high cost of living, increase in the prices of Rice, Pulses & Dhalls and also vegetables. Therefore the rates of tax may be fixed as under: Upto Rs. 3 Lakhs : from Rs.3 Lakhs to Rs. 5 Lakhs : from Rs.5 Lakhs to Rs.10 Lakhs : Above Rs. 10 Lakhs : 2. Corporate Tax At present the rate of tax for Companies is 30% plus Surcharge of 10% besides Educational Cess of 3%. Altogether the effective rate of tax comes to about 34%. The Chamber is of the strong view that the rate of tax for companies should be reduced to 25% on par with countries like Malaysia and Singapore. 3. Removal of Surcharge, Additional Surcharge, Education Cess and other levies: The levies like Surcharge, Additional Surcharge, Primary and Secondary Education Cess imposed as a temporary measure should be abolished as the target for which the levies were introduced long ago has been achieved over a period of time. 4. Tax on Firms Presently the Partnership firm is taxed at 30% on the profit plus Education Cess without any basic exemption. The Firm tax has become a big burden for smaller Partnership firms and the concept of Partnership is becoming unworkable. The Chamber suggests for a firm profit of at least Rs.3 Lakhs there should not be any Firm Tax. 5. Increase in T.D.S. Limit The T.D.S. limit should be increased upwards so that cumbersome procedures of reimbursement can be eliminated to save time and energy. 6. Relief Measures for exporters under the present Recessionary conditions: (i) Instant Export Credit should be made available to exporters against production of Export Orders or Letters of Credit.; (ii) Liberal steps to be taken for allowing or granting MDA to exporters to generate more business and for participating in the Exhibitions and Trade Fairs overseas.; (iii) Expeditious settlement of Duty Drawback, DEPB and others incentives etc. may give a sigh of relief to the Exporters in the present recessionary conditions. 5 Nil 10% 15% 20%

There should be no levy of Surcharge on Income Tax on Individuals.

7. Small Scale Units -- plea for increase in investment limit Presently the S.S.I. Limit (Investment in Plant & Machinery) is Rs.5 crores. There is need to enhance the present limit due to high inflationary conditions. The Chamber suggests for increasing the limit to Rs. 10 crores. 8. Direct Taxes Code Bill 2009 Though the Direct Taxes Code boasts of incorporating simplicity and best international practices, it scores low on promises of simplification of Income Tax Act and Rules. For example, sweeping powers have been provided to Tax Authorities which virtually nullifies the ratio of all judicial decisions. The Members have brought to our notice that the new Income Tax Code has the following drawbacks: (i) Single assessment interface with several Tax Authorities.; (ii) Sweeping powers with the Assessing officers with no accountability, so that, no finality is available for completed assessment; (iii) Irrational procedures in the place of best practices.; (iv) Harsh penalties and prosecutions; (v) Frequent references to provisions outside the clauses make it a cumbersome and time consuming procedure.; (vi) There is need to re -look on the proposals made and simplification should be mooted in a simple language for better understanding and more tax compliance. On a closer scrutiny of the proposals in the Direct Taxes Bill 2009, the proposed provisions are found to be more onerous than the existing provisions of Income tax Act 1961 and other Direct Tax Laws. With 310 definitions in Section 284 and 18 Schedules the new bill was neither simplified nor rationalised. 9. Introduction of Goods and Services Tax The Chamber wholeheartedly welcomes the new GST which has been followed by most of the developing countries. But, for smoother transition from VAT regime to GST, it is imperative that GST should be implemented from the first day of a Financial year. Trade and Industry are of the view that the GST will be implemented from April 1, 2012 and the announcement by the Finance Ministry to that effect may be during the announcement of Union Budget for 2011-2012. The Centre and the States are yet to finalise the frame work for the comprehensive tax reform as the GST will replace the major indirect taxes Central Excise duty, Service Tax, Value Added Tax and other State Taxes like Octroi and entry taxes. The Government should give enough time to industry and trade to prepare for the new GST regime. The on-going works contracts, Turnkey contracts and lease transactions should not be affected on introduction of GST and the Government should take necessary steps to avoid cascading effect or adverse impact of higher rates of taxation which will act as detrimental to the smooth flow of trade and industry. 6

The Trade Associations and Chambers of Commerce should be invited to debate on various issues of the GST system of taxation before it could be implemented. There is a need to involve, engage and educate industry and trade on the proposed new GST structure, well ahead of its implementation. 10. Reduction in Service Tax Rate There is need to reduce the present Service Tax rate of 10% to 8% to enthuse the stakeholders for more voluntary compliance. The trade and industry are feeling the pinch due to higher rate of taxation as they roll out their business with lesser margin. Needless to add, this would enhance tax compliance. 11. Export of Agricultural commodities Exports of many agricultural products viz. groundnuts, Fruits and Processed foods such as Egg, Poultry, meat etc. are currently taking place only on a bilateral basis as the standards and testing for health and environment concerns vary from country to country. Exporters, especially smaller players have raised the cost concern of having to get certificates from separate bodies many of them are in Private Sector. Agreement on Mutual recognition of Good Manufacturing Practices (GMP) Certificates will go a long way in alleviating some of the problems encountered by exporting community. 12. Port Development / Minor Ports along the Costal Areas Simplification of the processes and procedures at our Ports is a must. The challenge at the present moment is how to adopt the best practices, Capacity building etc. It could relate to availability of best handling equipment and or labour productivity also. The Chamber feels that the Government should address these prolonged issues and bestow its best attention. The Government should exercise its authority to improve operating conditions at Ports, to involve the Private Sector and build additional capacity. Faster modernization of existing Ports, Air Ports and improve the roads-connectivity to the Ports is the Prime concern now. The approaching roads to all Ports should be well built and ensure hassle free movement of cargo. Small Scale Industries Exemption Limit: The limit for exemption be raised from the present Rs. 150-00 lakhs in a year to Rs. 200-00 Lakhs. The Eligibility limit. The present limit of Rs. 400-00 Lakhs to Rs.500-00 Lakhs to off set the inflationery effect on the Small Scale industry. Exemption Notification 6/2006 - C.E Serial No 91. Serial No 91 prescribes Nil rate of duty for all goods of any chapter supplied against international competitive bidding subject to fulfillment of condition 19. which is If the goods are exempted from the duties of customs, leviable under the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) and the additional duty leviable under Section 3 of the said Customs Tariff Act when imported into India. 7

But the filed formations do not grant this exemption on the pretext of alleged non fulfillment of condition No. 19 annexed to the notification 6/2006 even when assessees explained previous conditions. Thus assessees rarely get this benefit of notification though it is in the scheme of things. Since intention of the Government is to reduce cost of projects to be executed under international competitive vending, the purpose of this Notification will be defeated, if Central Excise Department grant exemption whenever it is otherwise admissible. Excisability of Waste: Amendment made in the occupation of Excisability of Waste for Excisable goods to cover any item which fetches price to be considered as marketable has created disputes regarding classification of dutiability of dust, waste, residue etc. which are not falling in the definition of Waste & Scrap under Section 15 of Central Excise Tariff relating to metals. Though this type of waste/dust/residue etc. do not arise during manufacture or mechanical working of metals, merely because they fetch a price, departments trying to charge duty. Appropriate instructions in this regard must be given to the field formation. Levy of Education Cess & Secondary Education cess On Cess levied on Certain products. The suitable provisions should be made to exclude the Cess on Products being counted for calculating Education Cess & High Secondary Education Cess. Credit on Service Tax on Input Services: In order to avoid the continued litigation, it is suggested that a negative list be specified instead of inclusive definition. This would result in clarity & certainty on the credit on Input service tax taken. Transaction with SEZ: The existing procedure exempting service through refund mechanism provided to SEZ units and developers though they not consumed within the Zone requires outright exemption on certain conditions without insisting on payment of tax first and subsequent refund. Services rendered at the Premises of SEZ: Therefore the exemption should not only be given to the Main contractor who get the construction done through but also to the subcontractor. The Department is not inclined to grant exemption to Sub contractors who carry out their services at the premises of developer of SEZ or to an unit in the SEZ. A suitable notification may be issued to exempt even subcontractors from payment of service tax for a reason that as long as the service remains same and is otherwise provided in side the zone, all the persons connected to the said rendering of the service in side the zone should be exempted, whether he is a main contractor or a sub contractor. 8

Limit for Small service providers. In view of the current uncertain economic scenario and the inflationary pressures, the threshold limit may be increased to Rs.20.00 lakhs. This could be large boon to the small service providers who are put to most disadvantageous position. Sub-limit: Unlike a small scale industry in Central Excise, for eligibility criteria no sub limit exists under Service tax provisions. In other words A service provider once reaches threshold limit of Rs. 10.00 lakhs in the proceeding financial year, is not recognized as small service provider and loses the exemption. This not only limits his growth but also the revenue as the assessee normally finds out methods to remain in threshold limit. To help the industry grow faster and also help small service provider to last longer, it is suggested that the eligibility to reckon a small service provider be kept at Rs. 25.00 lakhs gross receipts from services in the preceding financial year. Up on fulfilling this condition the small service provider be given exemption from service tax up to the limit of Rs. 15.00 Lakhs and the small service provider shall pay service tax at the prescribed rates after crossing Rs.15.00 lakhs in the current financial year. As in Central Excise, Cenvat credit for small service providers, be allowed once the Unit starts paying service tax and other conditions as existing in Central Excise may be suitably worded and included to avail this exemption. Negative List for Availment of Credit of Tax Paid on Input Services: It is suggested that Negative list be specified on which no service tax credit could be taken . This will imply that all services not finding a place in the Negative list will be eligible for credit. Removal of C Form: Industry and trade are put to lot of hardship due to abnormal delay in obtaining, C Form from buyers. In case the Government intends to continue with C Form for the Financial Year, 2011-2012, it is suggested that the Commercial Tax Department should accept one C Form for a single party in a Financial Year without any limit. Grant of Exemption for all Medicinal Herbals: In order to save the Indian System of Medicine it is suggested to exempt all Medicinal herbs from the levy of Central Sales Tax as the volume of trade in Medicinal herbs in India is considerably very low. Abolition of Online Trading on Agricultural Products/Commodities: It is suggested that Government should take immediate steps to stop the online trading of all commodities especially Agri products and Commodities consumed by the commonman for their livelihood to prevent hoarding and increase in the prices.

BUDGET PROPOSALS FOR 2011-2012 -- DIRECT TAXES: The Honble Finance Minister, Shri Pranab Mukherjee has proposed the following changes in Direct Taxes 2011-2012 on February 28, 2011: Current surcharge of 7.5 per cent on domestic companies proposed to be reduced to 5 per cent. Rate of Minimum Alternative Tax proposed to be increased from 18 per cent to 18.5 per cent of book profits. Lower rate of 15 per cent tax on dividends received by an Indian company from its Foreign subsidiary. Investment linked deduction to businesses developing affordable housing. Weighted deduction on payments made to National Laboratories, Universities and Institutes of Technology to be enhanced to 200 per cent. System of collection of information from foreign tax jurisdictions to be strengthened. Benefit of investment linked deduction extended to businesses engaged in the production of fertilisers. The FM announced that Direct Tax Code will be implemented from April, 2012 Various IT initiatives taken for efficient tax administration. These include e -filing and e-payment of taxes, adoption of Sevottam concept by CBEC and CBDT, web based facility for tax payers to track the resolution of refunds and credit for pre-paid taxes and augmentation of processing capacity. Three more benches of Settlement Commission to be set up to fast track the disposal of cases. Steps initiated to reduce litigation and focus attention on high revenue cases. Exemption limit for the general category of individual taxpayers enhanced from Rs 1,60,000 to Rs 1,80,000. Rs 5,00,000 lakh tax exemption limit for individuals above 80 years of age Additional deduction of Rs 20,000 for investment in long -term infrastructure bonds proposed to be extended for one more year. Exemption limit enhanced and qualifying age reduced for senior citizens. Age for being classified as senior citizen cut to 60 years from 65 years. INCOME-TAX (FIRST AMENDMENT) RULES, 2011 - AMENDMENT IN RULES 6DDA, 6DDB AND APPENDIX-II Vide Notification No. N 14/2011 [F. NO. 142/25/2008-SO(TPL)] dated March 9, 2011 issued by the Ministry of Finance, Government of India, New Delhil In exercise of the powers conferred by section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:1. (1) These rules may be called the Income-tax (First Amendment) Rules, 2011.; (2) They shall come into force on the 1st day of April, 2011. 10

2. In rule 6DDA of the Income-tax Rules, 1962, (a) for clause (iv), the following clause shall be substituted, namely: (iv) the stock exchange shall ensure that transactions (in respect of cash and derivative market) once registered in the system are not erased; (b) after clause (iv), the following clause shall be inserted, namely: (v) the stock exchange shall ensure that the transactions (in respect of cash and derivative market) once registered in the system are modified only in cases of genuine error and maintain data regarding all transactions (in respect of cash and derivative market) registered in the system which have been modified and submit a monthly statement in Form No. 3BB to the Director General of Income-tax (Intelligence), New Delhi within fifteen days from the last day of each month to which such statement relates. 3. In rule 6DDB of the Income-tax Rules, 1962, in clause (iii) of sub-rule (2), for the word, brackets and letters clause (iv), the word, brackets and letter clause (v) shall be substituted. 4. In Appendix-II of the Income-tax Rules,1962, after Form No.3BA, the following Form shall be inserted, namely:P.S.: Form No. 3BB (See Rule 6DDA) -- Monthly statement to be furnished by a stock exchange in respect of transactions in which client codes been modified after registering in the system for the month of (ii) Annexure to Form No. 3BB (Soft Copy) -- Derivative Market; (iii) Cash Market which run to 5 pages, have not been reproduced in this issue. The full text of the Notification is available in the office of the Chamber for perusal of Members. Interested Members may obtain a copy of same from the office of the Chamber on request. INCOMETAX (SECOND AMENDMENT) RULES, 2011: Vide Notification No. S.O. 647(E) dated March 29, 2011 issued by the Central Board of Direct Taxes, Department of Revenue, Ministry of Finance, Government of India, New Delhi. In exercise of the powers conferred by section 295 of the Incometax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Incometax Rules, 1962, namely: 1. (1) These rules may be called the Incometax (Second Amendment) Rules, 2011.;(2) They shall come into force on the 1st day of April, 2011. 2. In the Income-tax rules, 1962, (a) for rule 28AA, the following rule shall be substituted, namely:Certificate for deduction at lower rates or no deduction of tax from income other than dividends. 28AA. (1) Where the Assessing Officer, on an application made by a person under sub-rule (1) of rule 28 is satisfied that existing and estimated tax liability of a person justifies the deduction of tax at lower rate or no deduction of tax, as the case may be, the Assessing Officer shall issue a certificate in accordance with the provisions of sub-section (1) of section 197 for deduction of tax at such lower rate or no deduction of tax. 11

(2) The existing and estimated liability referred to in sub-rule (1) shall be determined by the Assessing Officer after taking into consideration the following:(i) tax payable on estimated income of the previous year relevant to the assessment year; (ii) tax payable on the assessed or returned income, as the case may be, of the last three previous years; (iii) existing liability under the Income-tax Act,1961 and Wealth-tax Act,1957; (iv) advance tax payment for the assessment year relevant to the previous year till the date of making application under sub-rule (1) of rule 28; (v) tax deducted at source for the assessment year relevant to the previous year till the date of making application under sub-rule (1) of rule 28; and (vi) tax collected at source for the assessment year relevant to the previous year till the date of making application under sub-rule (1) of rule 28. (3) The certificate shall be valid for such period of the previous year as may be specified in the certificate, unless it is cancelled by the Assessing Officer at any time before the expiry of the specified period. (4) The certificate shall be valid only with regard to the person responsible for deducting the tax and named therein. (5) The certificate shall be issued direct to the person responsible for deducting the tax under advice to the person who made an application for issue of such certificate. (b) in rule 31A, in sub-rule (4), after clause (iv),the following clauses shall be inserted, namely:(v) furnish particulars of amount paid or credited on which tax was not deducted in view of the issue of certificate of no deduction of tax under section 197 by the Assessing Officer of the payee; (vi) furnish particulars of amount paid or credited on which tax was not deducted in view of the compliance of provisions of sub-section (6) of section 194C by the payee. (c) in Appendix-II , for Form No.13, the following Form shall be substituted, namely:P.S.: Form NO. 13 [See rules 28 and 37G] Application by a person for a certificate under sections 197 and/or 206C(9) of the Income-tax Act, 1961, for no *deduction/collection of tax or *deduction/ collection of tax at a lower rate which run to 7 pages, has not been reproduced in this issue. The full text of the Notification is available in the office of the Chamber for perusal of Members. Interested Members may obtain a copy of same from the office of the Chamber on request. INCOME-TAX (THIRD AMENDMENT) RULES, 2011: Vide Notification No. S.O. 639(E) dated April 5, 2011 issued by the Central Board of Direct Taxes, Department of Revenue, Ministry of Finance, Government of India, New Delhi. In exercise of the powers conferred by section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:12

1. 2.

(1) These rules may be called the Income-tax (Third Amendment) Rules, 2011.; (2) They shall come into force on the 1st day of April, 2011. In the Income-tax Rules, 1962,- (A) in rule 12, (i) in sub-rule (1),(a) the words, brackets, figures and letters or the return of fringe benefits required to be furnished under sub-section(1) or sub-section (2) of section 115WD shall be omitted; (b) for the figures 2010, the figures 2011 shall be substituted; (c) in clause (a), for the word and figures SARAL-II, the word SAHAJ shall be substituted; (d) after sub-clause (c), the following clause shall be inserted, namely:(ca) in the case of a person being an individual or a Hindu undivided family deriving business income and such income is computed in accordance with special provisions, referred to in section 44AD and section 44AE of the Act for computation of business income be in Form SUGAM (ITR-4S) and be verified in the manner indicated therein.;

(e) in clause (d), after the words, brackets and letter or clause (c), the words, brackets and letters or clause (ca), shall be inserted; (f) clause (h) shall be omitted; (ii) for sub-rule(2), the following sub-rule shall be substituted, namely: (2) The return of income required to be furnished in Form SAHAJ (ITR-1) or Form No. ITR-2 or Form No. ITR -3 or Form SUGAM (ITR-4S) or Form No. ITR -4 or Form No. ITR-5 or Form No. ITR -6 shall not be accompanied by a statement showing the computation of the tax payable on the basis of the return, or proof of the tax, if any, claimed to have been deducted or collected at source or the advance tax or tax on self-assessment, if any, claimed to have been paid or any document or copy of any account or form or report of audit required to be attached with the return of income under any of the provisions of the Act.; (iii) in sub-rule (3), the words or the return of fringe benefits, shall be omitted; (iv) in sub-rule (5), (a) the words or the return of fringe benefits shall be omitted; (b) for the figures 2009, the figures 2010 shall be substituted; (B) in Appendix-II, for Forms SARAL-II (ITR-1), ITR-2, ITR-3, ITR-4, ITR-5, ITR6, ITR-7 and ITR-V, the Forms SAHAJ (ITR-1), ITR-2, ITR-3, SUGAM (ITR-4S), ITR-4, ITR-5, ITR-6, ITR-7 and ITR-V shall be substituted.

13

III - TAMIL NADU VALUE ADDED TAX

TAMIL NADU VALUE ADDED TAX ACT, 2006 -- REDUCTION OF TAX ON PETROL Vide G.O. Ms. No. 45 dated March 1, 2011 issued by the Commercial Taxes and Registration (B2) Department, Government of Tamil Nadu. In exercise of the powers conferred by sub-section (1) of section 30 of the Tamil Nadu Value Added Tax Act, 2006 (Tamil Nadu Act 32 of 2006), the Governor of Tamil Nadu hereby makes a reduction in respect of tax payable by any dealer under the said Act on the sale of Petrol with or without additives from 30 percent to 27 percent. 2. The Notification shall come into force with effect on and from the 1st day of March 2011. TAMIL NADU VALUE ADDED TAX RULES 2007 -- AMENDMENTS TO: Vide G.O. Ms. No.4 issued by the Commercial Taxes and Registration (B1), Department, Government of Tamil Nadu and published in the Tamil Nadu Government Gazette Extraordinary, Part-III, Section 1(1) dated January 14, 2011. The following erratum is issued to the Commercial Taxes and Registration Department Notification No. SRO A-13(a)/2010 published at Page 1 of Part-III, Section 1(a) of the Tamil Nadu Government Gazette Extraordinary (Issue No.1150, dated the 19th April, 2010,ERRATUM In the said Notification for 9-4 read (9-A) No. SRO A-13(a)/2010 dated 19-4-2010) In exercise of the powers conferred by subsection (1) of Section 80 of the Tamil Nadu Value Added Tax Act, 2006 (Tamil Nadu Act 32 of 1006), the Governor of Tamil Nadu hereby makes the following amendment to the Tamil Nadu Value Added Tax Rules, 2007,AMENDMENT In the said Rules, after sub-rule (9), in Rule 4, the following sub-rule shall be inserted, namely:(9-4) (a) Every registered dealer whose certificate of registration is in force under this Act shall furnish the Permanent Account Number (PAN) along with the proof of the same to the Registering Authority within three months from the date of coming into force of this rule.; (b) Every dealers who applies for registration under this Act shall obtained the Permanent Account Number (PAN) and furnish it to the Registering Authority at the time of submission of the application along with the proof of the same.

14

TAMIL NADU VALUE ADDED TAX RULES, 2007-- AMENDMENT TO: Vide G.O. Ms. No.5 & SRO A-1(b)/2011 issued by the Commercial Taxes and Registration (B1) Department, Government of Tamil Nadu and published in the Tamil Nadu Government Gazette Extraordinary Part-III, Section 1(a) dated January 14, 2011. In exercise of the powers conferred by sub-section (1) of Section 80 of the Tamil Nadu Value Added Tax Act, 2006 (Tamil Nadu Act 32 of 2006), the Governor of Tamil Nadu hereby makes the following amendment to the Tamil Nadu Value Added Tax Act, 2007,AMENDMENT In the said Rules, in rule 4 to sub-rule (9-A), the following Proviso shall be added, namely:Provided that nothing in this sub-rule shall apply to the persons, bodies and entities specified in the Explanation-II and in paragraph (i), (ii), (iii) and (viii) of the Explanation-III to clause (15) of Section 2 of the Act. CERTAIN PERIOD OF EXTENSION OF TIME FOR FILING APPLICATIONS UNDER THE TAMIL NAUD SALES TAX (SETTLEMENT OF ARREARS) ACT, 2010: Vide G.O. Ms. No.153 dated August 31, 2010 issued by the Commercial Taxes and Registration (D1) Department and published in the Tamil Nadu Government Gazette Extraordinary dated August 31, 2010. In exercise of the powers conferred by sub-section (1) of Section 5 of the Tamil Nadu Sales Tax (Settlement of Arrears) Act, 2010 (Tamil Nadu Act 20 of 2010), the Governor of Tamil Nadu hereby specifies the 31st day of December 2010 as the date within which application for the purpose of Section 4 of the said Act shall be made to the designated authority appointed under the said Act.

IV - ANDHRA PRADESH VALUE ADDED TAX

THE ANDHRA PRADESH VALUE ADDED TAX RULES, 2005 - AMENDMENTS TO RULES Vide G.O. Ms. No. 54 dated January 19, 2011 issued by the Revenue (CT.II) Department, Government of Andhra Pradesh. In exercise of the powers conferred by section 78 read with clause (2) of section 2 of the Andhra Pradesh Value Added Tax Act, 2005 (Act 5 of 2005) , the Governor of Andhra Pradesh hereby makes the following amendment to the Andhra Pradesh Value Added Tax Rules, 2005 issued in G .O.Ms.No.394, Revenue (CT.II) Department, dated 31 3 2005.. as subsequently amended in G.O.Ms.No.1292, Revenue (CT.II) Department, dated14.10.2010. The amendment hereby made shall be deemed to have come into force with effect from the 3 March, 2009. 15

AMENDMENT In the said rules, in the Table under sub-rule (7) of rule 24, in column (3) for the heading "Tax Payable", the heading "Tax Payable Per Print" shall be substituted. THE ANDHRA PRADESH VALUE ADDED TAX RULES, 2005 - AMENDMENTS TO RULES: Vide G.O. Ms.No.54 dated January 19, 2011 issued by the Revenue (CT.II) Department, Government of Andhra Pradesh. In exercise of the powers conferred by section 78 read with clause (2) of section 2 of the Andhra Pradesh Value Added Tax Act, 2005 (Act 5 of 2005), the Governor of Andhra Pradesh hereby makes the following amendment to the Andhra Pradesh Value Added Tax Rules, 2005 issued in G.O. Ms. No. 394, Revenue (CT.II), Department, dated 31.3.2005 as subsequently amended in G.O. Ms. No.1292, Revenue (CT.II) Department, dated October 14, 2010. 2. The amendment hereby made shall be deemed to have come into force with effect from the 3rd March, 2009. AMENDMENT In the said rules, in the Table under sub-rule (7) of the rule 24, in column (3) for the heading Tax payable the heading Tax Payable per Print shall be substituted. AP VAT , 2005 -- ISSUE OF NOTIFICATION UNDER SUB-RULE (2) OF RULES 55 OF APVAT ACT, 2005 -- INCLUSION OF CERAMIC AND GLAZED TILES UNDER SENSITIVE GOODS: Vide CCTs JC(CT) Enft. Ref. No.D2/723/05 dated January 20, 2011 issued by the Commissioner of Commercial Tax, Government of Andhra Pradesh. Hyderabad. In exercise of the powers conferred by sub-rule (2) of Rule 55 of APVAT Act, 2005, and in continuation of the Notification issued in the reference cited, the Commissioner of Commercial Taxes, Andhra Pradesh hereby notifies Ceramic Tiles and Glazed Tiles in addition to the existing items for the purpose of said sub-rule. This notification will come into force with effect form February 1, 2011. Kind Attn: Members / Member Bodies / Readers of Tax News.: The Executive Committee of the Chamber has decided to send the Tax News and important Tax Law Notifications through Email to all Members and Member Bodies from January 1, 2011. Updates as regards important Tax Law Legislations will be published in the Monthly Information Bulletin. All Notifications and information pertaining to Tax Law News will be placed in the Chambers Website for the information of Members and the same can be downloaded In view of this, the Bi-monthly publication Tax Law News will henceforth be sent to all Members by Email only. Members who desire to have a printed copy may specifically request the Chamber to send the same by Post / Courier. Secretary.