Budget_Booklet_2022-23pdf

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Preface
This is the Amrit Kaal, the time to touch new heights without the worry of any failure. A
Union Budget this year is being presented with the vision for upliftment for the next 25
years by the honorable finance minister of Bharat Smt. Nirmala Sitaraman.
Digitalization and thereby inclusion, simplification, speed, collaboration, and transparency
has remained the theme across. Be it logistics, natural farming, health, education, lifestyle,
digital currency, or MSME.
Huge commitment and confidence are being displayed in the future of the Indian economy’s
internal consumption power and export promotion by the government, by increasing the
capital outlay budget by more than 35% higher than what it was in the previous year. We
may see the Green Bonds being introduced and large disinvestments by the Government
very soon to garner investments and fund this ambitious outlay.
As individuals, we dream to see India as a right, safe and great country to live in before 100
years of independence. As a business, it is dreamt to be super easy to operate with apt
infrastructure, competitive taxation, a huge captive opportunity of consumption, and on the
other hand young and talented manpower.
In the backdrop of our ancient text Mahabharata model of how judiciously the king should
collect legitimate tax from the public. A simplified, competitive, and judicious tax system
will drive better business and thereby better tax collection which Bharat is already
witnessing.
Income Tax Proposals are more focused on one of the steps to reduce litigation, give a level
playing field, promote fresh ideas & investment and bring in voluntary compliance.
GST is being looked at as a proud step by the government. While talking about the GST
model, the finance minister has been candid about the issues being faced and at the time
kindly gave credit to the taxpayers for high tax collections recorded in the last few months.
The experts, every year at APMH have come up with an analysis on proposed high impact
direct and indirect taxation updates in the Union Budget 2022 for the businesses as well as
Individuals.
Regards
Team APMH

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Index
Sr.
No
Particulars Page
No
DIRECT TAX PROPOSALS
1. Highlights of Direct Tax Proposals 5
2. Treatment of cess and surcharge - clarification 7
3. Procedure where an identical question of law is pending before High Courts or
Supreme Court u/s 158AB
7
4. Anti-Avoidance of Tax u/s 94(8) in case of Dividend &Bonus Stripping of Securities 9
5. Set off and Carry Forward of Losses by Public Sector Companies 10
6. Expansion of scope of Assessment and Reassessment Sec 149 11
7. Section 194 IA 12
8. Section 194 R 12
9. Section 206AB 13
10. Updated Income Tax Return with additional tax Section 139 (8A) 14
11. Tax Payment for opting to file u/s139 (8A), Section 140B 15
12. Deduction u/s 80DD 17
13. Amendment for granting benefits to IFSC 17
14. Exemption under sec 10 clause (4F) 18
15. Insertion of new clause (4G) to section 10 18
16. Deduction under section 80LA 19
17. Exemption to IFSC for excessconsideration received in excess of Fair MarketValue
Section 56 (Viib)
19
18. RevisedAlternate Minimum Taxand Surcharge rate for Co-operative Societies Section
115JC
20
19. Revised surcharge rate on long-term capital gains arising on transfer of any type of
asset Section 112/112A.
20
20. Section 115BAB 21
21. Deduction u/s 80CCD(2) 22
22. Section 80-IAC 22
23. Income From Other Sources Section 56 23
24. Definition of Perquisites Section 17(2) 24
25. Reporting by Producers of Cinematographic Films or Persons engaged in Specified
Activities Section 285(B)
25
26. Definition of the term “slump sale” Section 2(42C) 26
27. Reduction of Goodwill from the block of assets to be considered as transfer Section
50(2)
26
28. Penalty for failure to answer questions, sign statements, furnish information, returns
or statements, allow inspections etc Section 272A
27
29. Interest payable for failure to deduct and pay tax Section 201 28
30. Certain deductions to be only on actual payment Section 43B 28
31. Withdrawal of concessional rate of taxation of 15% Section 115BBD 29
32. Cash credits under section 68 of the act Section 68 29
33. Expenditure incurred concerning to exempt incomes Section 14A 30
34. Expenditure incurred by an assesse for any purpose which is an offense or which is
prohibited by law Section 37(1)
30
35. Virtual Digital Assets 32
36. Taxability of income from transfer of digital assets. 33
37. TDS to be deducted on purchase of digital assets. 34

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38. Deduction from undisclosed income. 34
39. In Addition time to use accumulated amounts 35
40. Tax Implications on breach of conditions on which exemption is granted 36
41. Implications when a charitable institution has not parked funds in funds mentioned
by the government
37
INDIRECT TAX PROPOSALS
42. Highlights of Indirect Tax Proposals 38
43. Eligibility of Input Tax Credit 40
44. Cancellation of GST Registration in case of Default by Dealers 40
45. Extension of time limit for issuance of Credit Notes 41
46. Furnishing details of outward supplies 41
47. Omission of Matching concept 42
48. Restrictions on availment of Input Tax Credit 42
49. Doing away of claiming ITC on provisional basis 43
50. Amendments in relation to the filing of returns 43
51. Amendment in late fees in case of failure to furnish GST Return 44
52. Interest on undue & excess claim of input tax credit 44
53. Transfer of amount in Electronic cash ledger 44
54. Restriction on use of Electronic credit ledger 45
55. GST Refund 45
56. GST Portal 46
57. GST Rate Notifications 46

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1. Treatment of cess and surcharge – clarification
a. Disallowance of any sum paid on account of tax levied on the profits or
gains of any business or profession
With effect from Retrospective effect from AY 2005-06 (Clarificatory
Nature)
Applicable to All Assessee
Impact Negative
Current provision Brief Change
As per section 40 (a)(ii) any sum paid on
account of tax levied on the profits orgains
of any business or profession shall not be
deducted in computing the income
chargeable under the head Profits and
gains of business or profession.
It is hereby clarified that for the
purposes of this sub-clause, the
term “tax” shall include and shall
be deemedto have always
included any surchargeor cess, by
whatever name called, on such
tax, and hence will not be allowed
as deduction against profit and
gains from business or profession.
APMH Comments:
● This amendment is carried out retrospectively to negate the impact of Hon’ble
Bombay HC verdict in the case of “Sesa Goa Limited Vs. JCIT” andHon’ble
Rajasthan HC verdict in case of “Chambal Fertilizers & Chemicals Ltd Vs. JCIT”
wherein it was held that cess paid by assessee is allowable expenditure.
● This will open a pandora box of pending cases and also assessments whichcan be
reopened.
2. Procedure where an identical question of law is pending before High
Courts or Supreme Court u/s 158AB
a. Insertion of new section
With effect from AY 2023-2024
Impact Positive

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Not Applicable as this is
newly insertedprovision
The proposed section states that, where a question of
law is common and where a decision of the
jurisdictional High Court, on the same question of law
is pending, the filing of appeal in such cases can be
avoided to reduce the amount of litigation.
Where the collegium (two or more Chief Commissioners
or Principal Commissioners or Commissioners of
Income-tax) thinks that any question of law arising in
the case of an assessee for any assessment year is
identical with a question of law already raised in his case
or in the case of any other assessee for any assessment
year, which is pending before the jurisdictional High
Court under section 260A, or the Supreme Court in an
appeal under section 261 or a special leave petition
under Article 136 of the Constitution, against the order
of the Appellate Tribunal or the jurisdictional High
Court, as the case may be, in favor of such assessee, it
may decide and intimate the Commissioner or Principal
Commissioner not to file any appeal, at this stage to the
Appellate Tribunal.
Further, the Commissioner or Principal Commissioner
shall, on receipt of a communication from the
collegium, direct the Assessing Officer to make an
application to the Appellate Tribunal or jurisdictional
High Court, as the case may be, in the prescribed form
within sixty days from the date of receipt of the order of
the Commissioner (Appeals) or within one hundred
and twenty days from the date of receipt of the order of
the Appellate Tribunal, as the case may be, stating that
an appeal on the question of law arising in the relevant
case may be filed when the decision on the question of
the law becomes final in the other case. The
Commissioner or Principal Commissioner shall direct
the
Assessing Officer to make such an application only if an
acceptance is received from the assessee to the effect
that the question of law in the other case is identical to
that arising in the relevant case, and in case no such

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APMH Comments:
● This will certainly reduce multiple litigations as apex court ruling would be
final and non-challengeable.
3. Anti-Avoidance of Tax u/s 94(8) in case of Dividend & Bonus Stripping of
Securities
a. To prevent tax evasion by way of Dividend & Bonus Stripping, ‘Securities’
have been included along with ‘Units’ in the said Section. The term ‘Units’ now
also includes Units of Business Trusts - ‘REIT’, ‘InVIT’, ‘AIF’.
Impact Bonus Shares of Securities which previously escaped the
ambit of this Section now have to bear the brunt of this
Section
In case of Dividend and Bonus
Stripping, only ‘Units’ are
currentlyincluded.
‘Securities’ are sought to be included
with Units and hence all the securities
including Units of Business Trusts -
‘REIT’, ‘InVIT’, ‘AIF’. would get
covered.
acceptance is received, the Commissioner or Principal
Commissioner shall proceed.
Furthermore, where the order of the Commissioner
(Appeals) or the order of the Appellate Tribunal, as the
case may be, in the relevant case is not in conformity
with the final decision on the question of law in the
other case as and when such order is received, the
Commissioner or Principal Commissioner may direct
the Assessing Officer to appeal to the Appellate
Tribunal or the jurisdictional High Court, as the case
may be, against such order.

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APMH Comments:
● This is a rationalized provision to bring uniformity of taxation in respect of
identical income/asset.
4. Set off and Carry Forward of Losses by Public Sector Companies
Applicable to Public Sector Company
Impact Positive Set off and carry forward of losses not
impacted for Public Sector Companies in case of
Strategic Disinvestment
APMH Comments:
● Public sector companies making strategic disinvestments are closely held (by the
central government) making this provision applicable to them. This is
rationalization provision so that losses brought forward are not wiped out due to
disinvestment.
Section 79
In the case of closely held
companies, in which the public
are not substantially interested
the Business Loss can be set off
and carried forward against
income of any previous year only
if at least 51% of Voting power is
beneficially held by persons in the
year in which such loss was
incurred continues to be a
shareholder on the last date of the
year in which such loss is to be set
off.
For facilitation of strategic disinvestment of
Public Sector Companies clause (f) to Section
79(2) is inserted which provides that the loss
incurred by a Public Sector Company can be set
off and carried forward after strategic
disinvestment if the Ultimate Holding
Company of such Public Sector Company before
the disinvestment, provided it continues to hold
at least 51% of voting power in the erstwhile
Public Sector Company till the date of set-off of
said losses.

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5. Section 149 - Expansion of scope of Assessment and Reassessment
Impact Negative
No notice under sec 148 shall be issued Now the coverage of issuance of notice
for relevant assessment year unless: is extended to in the form of assets but
a) 3 years have been passed from also expenditure in respect of
relevant AY unless it falls under
clause b.
transaction or in relation to event or
occasion or any entry in the books of
account is found.
b) If 3 years but not more than 10
years have been passed from
relevant AY unless AO is in
possession of books of accounts
of other documents or evidence which
reveal that income chargeable to tax
represented in the formof asset which
has escaped assessment amount to or
is likely to amount 50Lakh rupees or
more
APMH Comments:
 This widens scope of reopening the assess

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6. Section 194- IA
a. TDS to be Deducted on Payment on Transfer of Immovable Property other
than Agricultural Land
Impact Negative
On Transfer of Immovable Property
(other than Agricultural Land), TDS
needs to be deducted @1% if transaction
value of property is less than Rs. 50
Lakhs.
Under amended provisions, higher of the
transaction value or value determined by
stamp authorities to be considered for
the purpose.
APMH Comments:
 Many a times, transaction value is less than 50.00 Lakhs but stamp duty
valuationmay be higher than rs. 50.00 L. These cases would also be covered
within the ambit of section 194-IA.
7. Section 194R
a. TDS on benefit or perquisite of a business or profession
With effect from 1st July, 2022
Applicable to All Assessee but in case of Individual and HUF
(applicable if Gross Receipts/Turnover exceeds Rs 1Cr
from Business or Rs 50Lakhs from Profession)
Impact Negative
New Provision
● A Person who is responsible to pay any Benefit or Perquisite to a resident
person arising from business or the exercise of profession is required to
ensure that TDS @ 10% is deducted in respect of such benefit or perquisite.
Threshold limit of Rs 20,000 per financial year is provided for such
transactions.
● Individual / HUF whose turnover is less than Rs 1.00 Cr in immediately
preceding financial year are exempt from the clutches of this provision.
● Further, if such Benefit/Perquisite is wholly in kind or partly in kind and
partlyin kind, then the person giving such Benefit/Perquisite should ensure

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that TDS has been deducted and paid before releasing such
Benefit/Perquisite.
APMH Comments:
● Additional burden of TDS and compliance thereof is cast on the assessee.
8. Section 206AB :
a. Provision for deduction of tax at source for non-filers of income-tax return.
Impact Positive
● A Specified Person under this
section has been defined as a
person who has not filed Return
ofIncome for two years preceding
the current Financial Year.
● The provisions of Section 206AB
were not applicable incase TDS
deducted u/s. 192, 192A, 194B,
194BB, 194LBC & 194N.
● Condition of filling return of last 2
years is proposed to be reduced to
one year.
● Also included in the list of
exception are TDS deductible u/s
194-IA, 194- IB and 194M where
requirement of verifying previous
return filing is done away with.
APMH Comments :
● This is practical and rational change brought about. This will certainly
reduce compliance burden to a certain extent.

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9. Section 139(8A) : Updated Income Tax Return with additional tax
a. New sub section (8A) in section 139 has been introduced to allow individuals to file
updated Income Tax Returns
Applicable to Any Person
Impact Positive
New Provision
● Any Person, whether or not a return of income is furnished within due date
section 139(1) or belated return u/s. 139(4) or revised return u/s. 139(5) can
furnish an updated return in respect of their income or the income of any
other person in respect of whom they are assessable under the Act.
● This Return can be filed within two years from the end of the relevant
assessment year.
● The benefit under this section will not be applicable if the updated
return :
i. Is a return of loss or
ii. Has the effect of decreasing the total tax liability as determined while
filingthe return earlier or
iii. Results in refund or increases the refund due as determined while
filingthe return earlier or
● The person shall not be eligible to file an undated return of
income if
i. If search and seizure proceedings were initiated or documents were
seized orrequisition were being made. Further benefit will also not be
available for preceding two assessment year
ii. An updated return has already been furnished by him u/s 139(8A) of
the Act for the relevant assessment year.
iii. Any proceeding for assessment or reassessment or recomputation or
revision of income under the Act is pending or has been completed for
the relevant assessment year in his case.
iv. The assessing officer has information in respect of such person for the
relevant AY under the Prevention of Money Laundering Act 2002, the
Black Money & Imposition of Tax Act 2015 or the Prohibition of Benami
Transactions Act 1988 or The Smugglers and Foreign Exchange
Manipulators Act, 1976 & the same is being communicated to him prior
to the date of filing of return u/s 139(8A).
v. Information has been received under an agreement referred to in
sections 90or 90A in respect of such person for the relevant AY & the
same needs to be communicated to him prior to the date of filing of
return u/s 139(8A)

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vi. Any offence and prosecution proceedings have been initiated for the
relevantAY in respect of such person, prior to the date of filing of return
u/s 139(8A)
vii. He is a person or belongs to a class of persons as may be notified by
the Board. The return Filed u/s 139(8A) shall be treated as defective
unless such return is accompanied by the proof of payment of tax.
10. Section 140B : Tax Payment for opting to file u/s 139(8A)
a. New Section 140B has been introduced to provide for the tax payment for those
who are opting to file a updated return under Section 139(8A).
Applicable to Any Person
Impact Positive
New Provision
● Where no return is furnished earlier:
Where no return of income u/s 139(1) or 139(4) has been furnished, before
filing return u/s 139(8A), the assessee will be liable to pay the tax due along
with interest & fee payable under any provision of the Act for the delay in
furnishing the return or any delay or default in payment of advance tax
along with payment of additional tax. The Tax payable will be worked out
after giving credit to all taxes paid earlier including TDS / TCS credit.
● Where return u/s 139(1) or 139(4) or 139(5) has been furnished:
The assessee will be liable to pay the tax due along with interest & fee
payable under any provision of the Act for the delay in furnishing the
return or any delay or default in payment of advance tax along with
payment of additional tax as reduced by the amount of interest paid under
the provisions of the Act in the earlier return.
Tax payable will be computed after considering the following:
1. Amount of relief or tax referred to in sub-section (1) of section 140A, the
credit for which has been taken in the earlier return.
2. Tax deducted or collected at source, in accordance with the provisions of
Chapter XVII-B, on any income which is subject to such deduction or
collection and which is taken into account in computing total income and
which has not been claimed in the earlier return;
3. Any relief of tax or deduction of tax claimed under section 90 or section 91
on account of tax paid in a country outside India on such income which has
not been claimed in the earlier return;
4. Any relief of tax claimed under section 90A on account of tax paid in any
specified territory outside India referred to in that section on such income
which has not been claimed in the earlier return;

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5. Any tax credit claimed, to be set off in accordance with the provisions of
section 115JAA or section 115JD, which has not been claimed in the earlier
return.
The aforesaid tax shall be increased by the amount of refund, if any,
issued in respect of such an earlier return.
Note: In both the cases i.e (i) & (ii), the updated return, furnished u/s 139(8A)
shall be accompanied by proof of payment of such tax, additional tax, interest and
fee
● Additional Income Tax payable at the time of furnishing return u/s
139(8A):
i. At the rate of 25% of the aggregate of tax & interest payable. Such return
should be furnished after the expiry of time available for filing a belated
return or revised return and before completion of the period of 12 months
from the end of relevant AY.
ii. At the rate of 50% of the aggregate of tax & interest payable. Such return
should be furnished after the expiry of 12 months from the end of relevant
AY but before completion of the period of 24 months from the end of
relevant AY.
Note: For the computation of additional income tax, tax shall include
surcharge & cess. Further interest would be levied u/s. 234A/B/C as
applicable.
APMH Comments :
● The move by government to open an additional window is commendable and may
reduce litigation. However this has come at a cost (additional tax payment) which
is very high

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11. Deduction u/s 80DD :
a. Amount paid or deposited by assesse under a scheme for dependent being a
person with disability.
Applicable to Individual/ HUF
Impact Positive
On receipt of annuity / lump sum, the
amount of premium paid / deposited by
assesse is taxed in the hands of the
recipient whether assesse or a person
with disability as the case may be.
Amount received by dependent on
attaining the age of sixty years would not
be taxed in his hands i.e. person with
disability. .
APMH Comments :
● It is much needed and logical relief showing human touch.
12. Amendments for granting benefits to IFSC
Exemption under sec 10 clause (4E):
a. Income arising by way of transfer of non derivative forward contracts entered
into with an offshore banking unit of an IFSC
Applicable to Non Resident
Impact Positive
b. The amendment has been made to further incentivize operations of IFSC
Clause (4E) provides an exemption to
nonresidents on any income by way of
transfer of non-deliverable forwards
contracts entered into with an offshore
banking unit of an IFSC.
The said clause has been amended to
provide further exemption on the transfer
of offshore derivatives instruments
(instruments used by foreign investors to
invest in India’s securities market without
getting registered with SEBI) or over the
counter, derivatives entered into with an
offshore banking unit of an IFSC.

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APMH Comments:
● This is certainly in line with stated policy of promoting IFSCs
13.Exemption under sec 10 clause (4F):
a. Income by way of royalty or interest on lease of aircraft, paid by a unit of an
IFSC which has commenced its operation on or before 31/03/2024
.
Impact Positive
Currently the said clause provide The clause has been amended to
exemption on income earned by a non include the lease of “Ship” as well with
resident in the form of royalty & interest a proviso that the unit commences
on lease of an aircraft, paid by unit of operation on or before 31st March,
IFSC 2024 .
APMH Comments:
● Scope of exemption widened in line with stated policies of Government.
14. Insertion of new clause (4G) to section 10:
a. Exemption to any income received from portfolio of securities or financial
products or funds.
Impact Positive
Newly inserted provision Exemption to a non-resident on receipt
of any income arising from a portfolio of
securities or financial products or funds
which is managed or administered by
any portfolio manager on behalf of such
nonresident. The said income should be
received in an account maintained with
an offshore banking unit in any IFSC

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APMH Comments :
15.Deduction under section 80LA:
a) Deduction in respect of certain income of offshore banking units & IFSC.
Applicable to Unit of an IFSC
Impact Positive
Subsection 2(d) provide for deduction
on any income arising from transfer of
anasset being aircraft which was leased
bya unit of an IFSC
Income arising from transfer of an asset
being "Ship" to any person, which was
leased by a unit of IFSC shall also be
eligible for deduction
APMH Comments :
16. Section 56 (Viib) - Exemption to IFSC for excess consideration received
in excess of Fair Market Value
a. Exemption in respect of consideration received more than Fair Market Value on
the issue of shares exempt if received from specified funds regulated under the
International Financial Services Centres Authority Act, 2019.
Applicable to Unit of an IFSC
Impact Positive
The exemption is available for Venture
capital undertaking for receipt of excess
consideration than the Fair Market Value.
Funds regulated by International
Financial Services Centres Authority Act,
2019 is sought to be covered under the said
exemption

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APMH Comments :
17. Section 115JC - Revised Alternate Minimum Tax and Surcharge rate for
Co-operative Societies :
A. Rate of The Alternate Minimum Tax (AMT) and Surcharge for co-
operativesocieties
Applicable to Co-operative Societies
Impact Positive
B. This amendment has been proposed in order to bring parity between
the tax ratesapplicable to co-operative societies and companies.
Alternate Minimum Tax rate = 18.5%
Surcharge applicable in case the income
exceeds Rs. 1 crore but does not exceed
Rs. 10 crore = 12%
Rate of tax (Alternate Minimum Tax)
reduced to 15%
Revised Surcharge applicable in case the
income exceeds Rs. 1 crore but does not
exceed Rs. 10 crore = 7%
APMH Comments :
● Reduction of rates are with a view to bring these taxes in parity with corporate
tax.
18. Section 112/112A - Revised surcharge rate on long term capital gains
arising on transfer of any type of asset:
a. Rate of Surcharge on Long term capital gain arising from transfer of
any type of capital asset
Impact Positive

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Surcharge rate on Long Term Capital Rate of surcharge is capped @ 15%
arising on sale of assets other than for Long Term Capital Gain on all
listed equity shares ranged from 10% to
37% depending on total income
assets in case the long term capital
gain exceeds Rs 1.00 Cr
APMH Comment :
● Taxpayers having income exceeding Rs 2 crore will benefit from this
amendments.
19. Section 115BAB :
a. An incentive provided to newly incorporate manufacturing domestic
companies at a concessional rate of 15%.
Applicable to Newly incorporated manufacturing company
Impact Positive
Option of concessional rate of Tax @ The said date is proposed to be
15% for newly registered domestic Extended to 31st March, 2024.
manufacturing companies is available
subject to certain conditions. One of
the condition is to commence
the manufacturing before 31st March,
2023
APMH Comments :
● With the extension of timelines, all newly registered domestic companies which are
likely to miss the date of 31st March, 2023 would be able to take benefit of
concessional rate of taxes. This apart, many other companies which are in the process
of incorporation are likely to be benefitted.

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20. Deduction u/s 80CCD(2) :
a.Deduction in respect of contribution to the National Pension Scheme.
With effect from AY 2020-21 (Retrospective)
Applicable to Individual
Impact Positive
Any contribution by the employer in the Under the proposed amendment, State
NPS account of t h e employee is
allowed as
Govt is also included for the purpose of
deduction to employee. The limit for said higher eligibility of contribution.
contribution is 14% for Employee of Effectively, employees of state Gove
Central Govt and 10% in all other cases. would also be eligible for higher rate of
14% .
APMH Comments :
● It is rationalization provision to bring state Government employees at par with
Central Government employees.
21. Section 80-IAC :
A. Special provision in respect of specified business (start-up)
With effect from A.Y. 2022-23
Applicable to Eligible Start-up
Impact Positive

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Section 80-IAC - provide for a
deduction of an amount equal to 100 %
of the profits and gains derived from an
eligiblebusiness by an eligible start-up
for three consecutive assessment years
out of ten years, beginning from the
year of incorporation, at the option of
the assesses subject to fulfilling of
certain condition;
One of the conditions was the start-up is
incorporated on or after 1st day of April,
2016 but before 1st day of April 2022.
The said date of incorporation is proposed
to be extended by one year and all start-ups
registered till 31st March, 2023 are
proposed to be madeeligible to take benefit
of this provision.
APMH Comments :
● Government continues their support to start ups.
22. Section 56- Income From Other Sources
a. Money received by an Individual from any person/persons for medical
treatment of illness related to COVID-19 of self or family member and on
death of a family member not to be considered as income under the head
“Income from Other Sources”.
With effect from A.Y. 2020-21 (Retrospective)
Impact Positive
Where any person receives money from
any person/persons exceeding Rs
50,000/- the whole amount received is
considered as income and taxed under
the head “Income from Other Sources”.
However few exceptions where the
money received will not be taxed are
Money received by an individual from any
person/persons for the expenses actually
incurred by him on the medical treatment
of self or familymember with respect to
any illness related to Covid-19 will not be
treated asincome under the head “Income
of Other Sources” subject to conditions

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listed below:-
a. Money received from a relative.
b. Money received under
will/inheritance, on marriage.
c. Money received in the event of
death of the person paying the
money.
d. Money Received from
charitable institutions,
educational institutions,
hospitals, medical
institutions. etc
specified by Government time to time.
Also money received by an individual on
the death of a family member-
a. From Employer of the deceased
without any monetary limit.
b. From any person/persons upto Rs
10 lakhs.
Will not be considered as income under
the head “Income from Other Sources”
provided the following conditions are
satisfied:
i. Death of the family member is on
account of Covid-19.
AND
ii. ii. Payment is received within 12 months
from the death of such person
APMH Comments :
● In line with government’s stated policy of granting all the benefits to
COVID 19 sufferers.
23. Section 17(2)- Definition of Perquisites.
a. Amount paid by an employer to the employee for medical treatment of self
or any of his family members in respect of any illness relating to Covid-19 not
to be taxed under the head “Salary” as perquisites.
Applicable to Individual
Impact Positive
Amount paid by an employer to an
employee with respect to the
expenditureactually incurred by him for
the medical treatment of self or any of
The said amount to now include amount
paid to an employee by the employer with
respect to actual expenditure incurred by
the employee on medical treatment of self

25
his family member in the Govt
Hospital, in respect of prescribed
diseases or in any hospital approved by
Principal Commissioner or Chief
Commissioner will not taxed as
perquisite under the head “Salary”.
or family member with respect to any
illness relating to Covid-19.
APMH Comments :
● In line with government’s stated policy of granting all the benefits to
COVID 19 sufferers.
24. Section 285(B) - Reporting by Producers of Cinematographic Films or
Persons engaged in Specified Activities.
a. Producers of cinematographic films produce statements to AO for payment
made or due from him to any person engaged in such production for an
amount exceeding Rs 50,000/-.
Impact Negative
Producers of cinematographic films have The said section now to include
to produce statement to A.O in persons engaged in Event
prescribed form giving details of Management, documentary production,
payments exceeding Rs 50,000/- made production of programs for telecasting
or to be made by him to every person on television or over the top platforms
engaged in production within prescribed or any other similar platform, sports
time limit event management, other performing
arts.
APMH Comments :
● This will undoubtedly increase the compliance burden of tax payer.

26
25. Section 2(42C) - Definition of the term “slump sale”.
a. The definition of slump sale underwent a change in AY 2021-22. A consequential
change proposed to be carried out in the current finance bill .
Impact Negative
Slump sale means the transfer of one or
more undertakings, by any means, for a
lump sum consideration without values
being assigned to the individual assets
Use of word ‘Sales’ did not include non
monetary transfers. To include these
kinds of transactions the word “Sales” is
proposed to be replaced by the word
and liabilities in such sales. This
definition was amended by Finance Act
2021.
‘Transfer”
APMH Comments :
● The amendment is carried out to rectify the drafting error.
26. Section 50(2) - Reduction of Goodwill from block of assets to be
considered as transfer
a. The amendments were made by Finance Act, 2021 by removing the Goodwill
from the definition of block of asset.
Applicable to All Assessees
Impact Negative

27
Goodwill of a business or profession is
not considered as a depreciable asset.
Consequently, the said amount of
Goodwill is taken as cost at the time of
sale. The said amendment was carried
out by the Finance Act 2021,
Consequently, entail amendment was
carried out for computation of capital
gains in section 50 along with
amendment in definition of cost of
acquisition u/s. 43(6).
New Explanation is added to clarify that
such reduction from block of asset shall be
deemed to be transfer of asset. Majority of
the assessee have already filed their
return of income.
APMH Comments :
● Now considering the proposed clarification a revised return would require to be
filed by treating it as deemed transfer for AY 2021-22.
27. Section 272A - Penalty for failure to answer questions, sign statements,
furnish information, returns or statements, allow inspections etc.
a. Penalty for non-compliance of Section 272A.
Impact Negative
Presently a penalty of Rs. 100 every day
during which default continues.
Now the limit of Rs.100 per day is
proposed to make Rs.500 per day for
defaults made by the assessee. This will
possibly result in faster collection of
information considering a high value of
penalty.

28
28. Section 201 - Interest payable for failure to deduct and pay tax
a. Interest to be paid on failure of deduction and payment of tax
Impact Negative
Interest at the rate of 1% for every month
or part thereof is payable in case of
failure to deduct tax and in case of
deducting the same and failure to pay
interest is chargeable at the rate of 1.5%
per month or part of month.
In case the order is passed by the
Assessing office for default, interest at the
rate of 1.5% per month or part thereof
shall be charged in both thecases.
29. Section 43B - Certain deductions to be only on actual payment.
a. Interest to be paid on failure of deduction and payment of tax.
Impact Negative
Interest payable on "debentures or other
instruments by which the liability to pay
is deferred to future date" was not
covered by section 43B. Hence, the
deduction thereof was allowed even
when the payment of interest on the
same was not actually made before the
due date of filing the return of income.
By including "debentures or other
instruments by which the liability to pay is
deferred to future date" in section 43B, it
will be necessary to make actualpayment
of interest before the due dateof filling the
return in order to claim the same as
deduction..
APMH Comments :
● The amendment is logical and rational.

29
30. Section 115BBD - Withdrawal of concessional rate of taxation of 15%
a. Withdrawal of concessional rate of taxation on dividend income in respect of
Domestic Companies.
Applicable to Domestic Companies
Impact Negative
Section 115BBD of the Act provides for a The said concession is sought to be
concessional rate of tax of 15 % on the withdrawn and the dividend from
dividend income received by an Indian foreign companies will be taxed at
company from a foreign company in normal rates.
26% or more in nominal value of
equity shares.
APMH Comments :
● The rate was provided at the time where dividend from domestic companies
were exempt in the hands of shareholder. Since the said exemption is
withdrawn, this is alogical move on the part of the government.
31. Section 68 - Cash credits under section 68 of the Act.
a. Taking of Loan would be subject to additional verifications.
Applicable to All Assessee.
Impact Negative
Where any sum is found to be credited
in the books of an assesse and the
assesse offers no explanation about the
nature and source thereof or the
explanation offered by him is not, in the
opinion of the AO, satisfactory, the
New Provision inserted -
Where the sum so credited consists of
loan or borrowing, any explanation
offered by such assesse shall be deemed to
be satisfactory if (a) the person in
whose name such credit is recorded in

30
sum so credited charged to income-
tax as the income of the assesse. It is
noticed that there is a practice of
conversion of unaccounted money by
crediting it to the books of assesses
through a loan or borrowing.
Earlier we used to satisfy the ICG test
while establishing the geniuses of the
transaction i.e. identity
creditworthiness and genuineness of
the transaction
the books of such assesse also offers
an explanation about the nature and
source of such sum and (b) such
explanation in the opinion of the AO has
been found to be satisfactory: Now apart
from satisfaction of ICG. (Identity
creditworthiness and genuineness), an
additional test to fulfill.
i.e. i.e. how the funds were accumulated
by the borrower also need to be
satisfied.
32. Section 14A - Expenditure incurred in relation to exempt incomes.
a. Expenditure incurred in relation to exempt incomes shall not be allowed as
deduction.
Impact Negative
No deduction shall be allowed for any
expenditure incurred by an assessee in
relation to exempt income.
It has been clarified that any expenditure
incurred by an assessee in a financial year
in relation to exempt income shallbe
disallowed even if the said exempt income
does not accrue or received during the said
financial year.
33. Section 37(1) - Expenditure incurred by an assesse for any purpose
which is an offence or which is prohibited by law.
a. Expenditure incurred by an assessed for any purpose which is an offence or w
h
i
c
his
prohibited by law shall be not allowed as deduction.
Impact Negative

31
Any expenditure incurred by an assessee
for any purpose which is an offence or
which is prohibited by law shall not be
deemed to have been incurred for the
purpose of business or profession and no
deduction orallowance shall be made in
respect of such expenditure.
The section further clarifies that any
expenditure incurred by an assessee in
relation to Corporate Social
responsibilityus 135 of Companies Act,
2013 and expenditure incurred by an
assessee on advertisement in any
souvenir, brochure,tract, pamphlet or the
like published by a political party shall
not be deemed to be an expenditure
incurred by the assesseefor the purposes
of the business or profession.
In section 37 of the Income-tax Act, the
following explanation is proposed to be
added.
It is clarified that the expenditure
incurred by an assessee for any purpose
which is an offence or which is
prohibited by law”, shall include and
shall be deemed to always include the
following expenditure incurred by an
assessee:
i) Expenditure for any purpose which is
an offence under, or
which is prohibited by any law for the
time being in force, in India or outside
India; eg: (expenditure incurred by
pharmaceutical companies in the form
of Gift, Travel facility, Hospitality, Cash
or monetary grant to Medical
practitioners as it is prohibited by
provisions of Indian Medical Council
(Professional Conduct, Etiquette and
Ethics) Regulations, 2002).
(ii) to provide any benefit or perquisite,
in whatever form, to a person, whether
or not that person is carrying on a
business or exercising a profession.
Acceptance of such benefit or perquisite
by such person is in violation of any law
or
rule or regulation or guideline, as the
case may be, for the time being in force,
governing the conduct of such person; or

32
to compound (commit multiple
offences) an offence under any law for
the time being in force, in India or
outside India.
34. Virtual Digital Assets :
a. This is one of the first official guideline in respect of Digital Assets. This
clarification was long due
Applicable for
definition
AY 2022-23
Impact Negative
Taxability and TDS provisions applicable : From AY 2023-24
Applicable to : All assessee
Cryptocurrencies including the non-fungible tokens (NFTs) are the most happening
things at present around the world. India has one of the biggest markets in cryptos/
digital tokens, however they are still not recognised as legal tender.
The Finance Minister Ms. Nirmala Sitaraman has introduced a new tax framework
forcryptocurrency transactions. However, a new law to introduce RBI backed digital
currency and regulate other cryptocurrencies (and possibly NFTs) is still awaited.
35. Section 2 (47A) is inserted to define “Virtual Digital Asset”
a. any information or code or number or token (not being Indian currency or
foreign currency), generated through cryptographic means or otherwise, by
whatever name called, providing a digital representation of value
exchanged with or without consideration, with the promise or
representation of having inherent value, or functions as a store of value or
a unit of account including its use in any financial transaction or
investment, but not limited to investment scheme; and can be transferred,
stored or traded electronically;
I. a non-fungible token or any other token of similar nature, by
whatever name called;
II. any other digital asset, as the Central Government may, by
notification in the Official Gazette specify:

33
b. Provided that the Central Government may, by notification in the Official
Gazette, exclude any digital asset from the definition of virtual digital asset
subject to such conditions as may be specified therein.
c. Explanation.–For the purposes of this clause,––
I. “non-fungible token” means such digital asset as the Central
Government may, by notification in the Official Gazette, specify;
II. the expressions “currency”, “foreign currency” and “Indian
currency” shall have thesame meanings as respectively assigned
to them in clauses (h), (m) and (q) ofsection 2 of the Foreign
Exchange Management Act, 1999.’.
36. Sec 115BBH – from FY 2022-23 (AY 2023-24) Taxability of income from
transfer of digital assets.
This section is introduced to tax income from transfer of any virtual digital assets.
a. Tax will be @ 30% on profit.
b. Only purchase cost of the digital assets is allowable as deduction fromsale
transaction.
c. Loss from digital assets cannot be set off against income from anyother source.
d. Loss from transfer of digital assets cannot be carried forward tosucceeding
assessment years.
This is much needed clarification that has come through the finance bill. Though it has
come with higher tax rate and stringent conditions including non-allowance of carry
forward of losses to subsequent year. This is more so as the losses from virtualdigital
assets are not allowed to be adjusted against any other sources of income.
37. Section 194S –
Applicable from : 01.07.2022 (AY 2023-24) TDS to be deducted on purchase of
digital assets.
TDS on payment for transfer of virtual digital assets to a resident at the rate of 1% (one
percent) of such sum. If such sum is more than Rs. 50,000 during the financialyear in
aggregate paid by “specified person” or more than Rs. 10,000 in aggregatepaid by
“person other than specified person.”
This TDS needs to be deducted also by “specified persons”.
That means persons having business turnover of Rs. 1 crore or less and persons having
professional turnover of Rs. 50 lakhs or less during previous year also need todeduct

34
TDS if they are paying more than Rs. 50,000 in aggregate in a year for purchase of
digital assets from another resident Indian. Person who is having incomein other heads
also needs to deduct TDS if he pays for purchase of crypto valued more than Rs.
50000/- in aggregate during the year.
However in case the payment for such transfer is -----
I. Wholly in kind or in exchange of another virtual digital assets wherethere
is no part paid in cash; OR
II. Partly in cash and partly in kind but the part of cash is not sufficientto
meet the liability of TDS in respect of whole such transfer,
The person shall ensure that the tax has been paid in respect of such
consideration.
Once TDS is deducted under this section 194S, then no tax is to be collected or
deducted in respect of the said transaction under any other provision of Chapter
XVII of the Act.
In case, any sum paid for transfer of virtual digital assets is credited to suspense
account or by any other name, in the books of account of the person liable to pay
such sum, such credit of the sum shall be deemed to be the credit of such sum tothe
account of the payee and the provisions of section 194S shall apply accordingly.
38. Section 79A: Deduction from undisclosed income.
Impact Negative
This is a new section inserted to deny any deduction from the undisclosed income
found by authorities during survey or search. Any brought forward losses or
unabsorbed depreciation will not be allowed to set off against undisclosed income
unearthed by authorities.
For this section “undisclosed Income” means
i. any income of the previous year represented, either wholly or partly, by any
money,bullion, jewellery or other valuable article or thing or any entry in the
books of accountor other documents or transactions found in the course of a
search under section 132or a requisition under section 132A or a survey under
section 133A other than under sub-section (2A) of that section, which has—
ii. not been recorded on or before the date of search or requisition or survey, as the
case may be, in the books of account or other documents maintained in the
normal course relating to such previous year; or

35
iii. not been disclosed to the Principal Chief Commissioner or Chief Commissioner
or Principal Commissioner or Commissioner before the date of search or
requisition or survey, as the case may be; or
iv. any income of the previous year represented, either wholly or partly, by any
entry in respect of an expense recorded in the books of account or other
documents maintained in the normal course relating to the previous year which
is found to be false and which would not have been found to be so, had the
search not been initiated or the survey not been conducted or the requisition not
been made.’.
39. Section 10(23C)
● Addition time to use accumulated amounts
Applicable to Entities taking benefit of section 10(23C)
Impact Negative
When there is delay in filing the return, Exemption is available only if return
exemption u/s 10(23C) still can be filed before due date
availed
40. Section 11
a. Addition time to use accumulated amounts
Applicable to Entities taking benefit of section 11
Impact Positive
No additional time above the prescribed Additional time can be taken after
time was granted to utilise the approval from the assessing officer on
accumulated amount basis of genuine grounds

36
41. Donations received for renovation is not taxable
Impact Positive
When a voluntary donation for
renovationwork is received by a religious
institution, the same is taxed initially, and
then as and when expense is incurred, the
same is allowed as deduction.
No need to tax the same income, hence,
when expense is incurred, the same is
not allowed as deduction. The above
clause is optional for the assessee.
In order to opt the same, few
conditions needs to be fulfilled, such as
1. 1. The same is applied for the specified
purpose
2. 2. The same is not donated to anyother
entity
3. 3. The same fund is maintained
separately
4. 4. The same is deposited in the
specified modes
42. Section 12A
a. Books of accounts to be maintained by charitable entities
Impact Positive
No Specific Section If income before the exemptionsexceeds
2.5 lakh, books needs to be maintained
43. Section 13
a. Tax Implications on breach of conditions on which exemption is granted
Applicable to Entities taking benefit of section 11, but have

37
failed to comply with listed conditions
Impact Negative
No Specific Section mentioning
taxtreatment on the breach
Tax treatment is now specified : Eligible
Expenses will be deducted from the Gross
Receipts, and tax will be payable on the
same. Also, No Setoff of losses will be
allowed in such cases.
Eligible expenses does not include the
following:
1. Expenditure out of corpus
2. Expenditure out of loan proceeds
3. Donations to any person
4. Capital Expenditures
44. Section 13
a. Implications when a charitable institution has not parked funds in funds
mentioned bygovernment
Impact Negative
No Specific Section mentioning
taxtreatment on the breach
The Benefits Granted in Section 11 &
12 will cease for the entity.

40
1. Eligibility of Input Tax Credit (Section 16)
a. Subsection (ba) is inserted in 16(2) whereby the dealer will be eligible for
the input tax credit only if the credit has not been restricted in auto-
generated ITC statements available electronically on the GST Portal.
Many parameters restricting the input tax credit have been brought onto
the statute u/s 38 which prescribes the situations in which the recipient
will not be eligible to claim ITC due to defaults made by the suppliers.
b. Extension of the time limit to avail ITC (Input Tax Credit) of Invoices /
Debit Note u/s 16(4) pertaining to a financial year from the due date for
the month of September following the end of the financial year to 30th
November of the following financial year.
APMH Comments:
 The dealer will be eligible for Input Tax Credit only when the details of
the invoice/ debit note is matched with the details furnished by the
Supplier in the statement of outward supplies and such details shall be
made available to recipients in auto-generated ITC Statement namely
“2B” but subject to certain restrictions.
 The intention of the government is to give ITC only to the extent of ITC
Available in 2B subject to certain restrictions.
 The number of restrictions has been provided in section 38 which needs
to be checked while availing ITC even though such ITC is reflected in 2B.
 Extension of the time limit to avail ITC up to 30th November is a good
move; it will allow additional two months to take the missed ITC.
Generally, Companies/entities get their books of accounts audited by
September. Hence, based on the findings of such an audit, one may take
steps to avail the missed ITC accordingly.
 With the change in due date for availing ITC under Section 16(4) in
respect of Invoices/Debit Notes, a similar amendment is proposed in
Section 34(2) which prescribes the date of issuance and date of
declaration of a credit note. The same has been considered in point no.
3 mentioned below.
2. Cancellation of GST Registration in case of Default by Dealers
(Section 29)
a. If the Composition Dealer has not furnished the return (GST 4) for a
financial year beyond three months from the due date of furnishing of
the said return, then GST Registration is liable for cancellation.
b. In the case of Taxpayers other than Composition Dealer, if the return is
not furnished for such continuous tax period as may be prescribed, then
registration of such taxpayer is liable for cancellation.

41
APMH Comments:
 Earlier Composition Dealer registration was liable for cancellation if the
returns was not furnished for three consecutive periods. However, with
the change in frequency of filing GSTR-4 from quarterly to yearly, such
an amendment was necessary to align with frequency of return.
 Earlier, in case of Taxpayers other than composition dealers, GST
Registration was liable for cancellation if the GSTR-3B returns are not
furnished for a continuous tax period of six months. This specific
timeline has been substituted to “such continuous tax period as may be
prescribed”. Related Rule shall be amended / inserted which shall
determine such period.
3. Extension of time limit for issuance of Credit Notes (Section 34)
a. Extension of time limit for issuance of Credit Notes in respect of any
supply made in a financial year from 30th September to 30th November
of the following financial year.
APMH Comments:
 Generally, Companies/entities get their books of accounts audited by
September along with reconciliations of various ledgers including
customer / Vendor Ledgers.
 This will give additional two months for the taxpayers to issue credit
notes from the end of the audit/reconciliation of ledgers.
 Based on such audit/reconciliation, if the taxpayers have to issue a credit
note, then it is allowable after September as well for issuance of credit
notes of the previous year’s invoices but up to 30th November of the
following financial year.
4. Furnishing details of outward supplies (Section 37):
a. It is proposed to prescribe conditions and restrictions, within such time
and manner, for furnishing the details of an outward supply in GSTR-1
and for communication of the details of such outward supplies to
concerned recipients;
b. Extension of time limit for rectification of error/omission in respect of
any supply made in a financial year from 30th September to 30th
November of the following financial year.
c. Period wise sequential filing of GSTR 1 is made mandatory.
APMH Comments:
 Due to such amendments, a two-way communication process in return
filing has been done away with.
 Additional time has been provided for rectification of error/omission in
outward supplies for the transactions pertaining to the previous year.

42
 A taxpayer shall not be allowed to furnish the details of outward supplies
for a tax period if the details of outward supplies for any of the previous
tax periods have not been furnished by him.
5. Omission of Matching concept (Section 42, 43 and 43A) :
a. Section 42, 43, and 43A prescribing procedures for the filing of returns,
matching, and reversal of credit have been proposed to be omitted.
b. During the inception of GST, the matching concept by way of filing of
GSTR-1, GSTR-2, and GSTR-3 were going to be implemented, however,
the same never got operational and now the Sections relating to such
matching have been proposed to be omitted.
c. Thus the two-way communication process in return filing that was yet to
be implemented is proposed to be scrapped.
APMH Comments:
 Doing away with the two-way communication process that was proposed
to be implemented earlier might lead to difficulty in claiming credit, as
GSTR-3B is a summarized return, and tracing invoice level data would
be difficult. Verification of whether payment of a particular invoice has
been made in the supplier’s GSTR-3B return would be challenging. This
is a retrograde step by the government since the claim, matching,
reversal, and reclaim were an integral part of the GST law at the time of
the introduction in July’17 and sufficient opportunities were expected to
be provided to the supplier and recipient to communicate and verify the
counterclaims, before levying of tax on such supplier or disallowance of
credit to the recipient.
6. Restrictions on availment of Input Tax Credit (Section 38) :
a. Section 38, which earlier pertained to the furnishing of inward supplies,
is amended to remove reference of the earlier envisaged GSTR-2 and
replace it with GSTR-2A and GSTR-2B. The section heading is also
changed to ‘Communication of details of inward supplies and input tax
credit’.
b. The manner, conditions, and restrictions in which the details of an input
tax credit of inward supplies will be communicated to the recipient shall
be prescribed, thus doing away with the two-way communication
process of return filing.
c. The input tax credit can be availed only if such credit has not been
restricted in auto-generated ITC statements available electronically on
the GST Portal. Many parameters restricting the input tax credit have
been brought onto statute which includes:
i. Claiming of ITC within such period of taking registration as may
be prescribed
ii. Default in payment of tax by the suppliers

43
iii. Default in filing returns by suppliers where tax payable shown in
GSTR-1 exceeds tax paid in GSTR-3B
iv. Default by a supplier in availing more ITC than eligible
v. Default in discharging tax liability
APMH Comments:
 The restrictions that were there earlier have now been made even more
stringent by introducing conditions wherein default of the supplier is
involved.
7. Doing away with claiming ITC on a provisional basis (Section 41) :
a. Section 41 of the CGST Act which earlier pertained to claim of Input Tax
Credit and provisional acceptance thereof shall be substituted to do away
with the concept of “claim” of ITC on a “provisional” basis and to provide
for availing of a self-assessed input tax credit.
b. The taxpayer shall have to self-assess and avail ITC by claiming
credit and reversing thereof (with interest) in case the tax has not been
paid by the supplier. Further the same can be reclaimed whenever such
tax is paid by the supplier.
APMH Comments:
 Verification of whether the supplier has paid tax in their GSTR-3B for a
particular invoice shall be challenging. In such context, we highlight the
Latin maxim, “Lex non-cogitadimpossibila” (the law does not compel a
man to do that which he cannot possibly perform)
and “impossibilumnullaobligntoest” (the law does not expect a party to
do the impossible). The recipient does not have control over defaults
made in the filing of returns or upon nonpayment of taxes by the
supplier. Such a provision is required to be challenged in a court of law.
8. Amendments concerning to filing of returns (Section 39):
a. The due date to file GSTR-5 by Non-resident taxable persons is preponed
from 20th of next month to the 13th of next month.
b. The time limit for rectification of errors in GSTR-3B is proposed to be
extended from the due date of filing return for September to 30th
November of the subsequent financial year.
c. Filing of GSTR-1 shall be a prerequisite to file GSTR-3B

44
9. Amendment in late fees in case of failure to furnish GST Return
(Section 47 of CGST Act 2017)
a. Provision for late fees in Form GSTR 2 is proposed to be omitted since
Form GSTR 2 is not operative.
b. Late fees of Rs 200 (CGST Rs 100 SGST Rs 100) is proposed to be levied
in case of failure to file GST TCS return (Form GSTR 8) under Section 47
of CGST Act, 2017 by the e-commerce operator.
10. Interest on undue & excess claim of input tax credit (Section 50 of
CGST Act 2017)
a. Interest for input tax credit wrongly availed and utilized shall be levied
@18% instead of 24% retrospectively from 1st July 2017.
APMH Comments:
 Before the amendment a taxable person who makes an undue or excess
claim of the input tax credit as per Section 42(10) and Section 43(10) of
CGST Act, 2017 was required to pay interest on such undue or excess
claim @ 24% as per Notification No 13/2017 - Central Tax dated 28th
June 2017.
 However, Section 42 and Section 43 were not operative and the
matching, reclaim and reversal process was not available on the portal.
 After the proposed amendment, a taxable person who has wrongly
availed & utilized input tax credit shall pay interest @ 18%
retrospectively with effect from 1st July 2017.
 The said amendment is beneficial for the taxpayers. It is now amply clear
that no interest will be levied on wrongful availing of the input tax credit
if such ITC has not been utilized for payment of tax.
 However, clarity is awaited in cases where the taxpayer has already paid
interest at the rate of 24%. Will such taxpayers be eligible to claim a
refund of excess interest paid?
11. Transfer of amount in Electronic cash ledger (Section 49 of CGST
Act 2017)
a. Cash balance in Electronic cash ledger can now be transferred across
GST registrations of the distinct person(s) having the same PAN.
APMH Comments:
 Earlier taxable person could transfer amount in Electronic cash ledger
from one head to another head (tax, interest, penalty, fees or any other
amount) by using PMT-09 in same GSTIN
 Post proposed amendment, the taxable person having different GST
registrations across India can transfer the amount in Electronic cash
ledger from one registration to another registration.

45
12.Restriction on use of Electronic credit ledger (Section 49 of CGST
Act 2017)
a. Section 49 of the CGST Act, 2017 is being amended to provide for
prescribing the maximum proportion of output tax liability that may be
discharged through the electronic credit ledger.
APMH Comments:
 Currently Rule 86B of The CGST Rules 2017 restricts the utilization of
the amount available in electronic credit ledger subject to certain
conditions as prescribed in the Rule. (i.e. 1% would be required to be paid
in cash.)
 After the introduction of section 49(12) govt will prescribe the condition
& restrictions which specify the maximum proportion of output tax
liability that may be discharged through the electronic credit ledger by
registered persons or a class of registered persons as may be prescribed.
13.GST Refund - Section 54 of CGST Act, 2017
a. A refund claim of the balance lying in the electronic cash ledger was
required to be made in Form GSTR 3. Since GSTR 3 is not operative, a
refund application is proposed to be made in the manner to be
prescribed. However, the facility of such a refund application is already
activated on GST Portal in Form RFD 01.
b. Section 54(2) provides for refund of taxes paid on the notified supplies
of goods or services or both received by specified agencies (like United
Nations Organisations, Consulate, or embassy, etc.)
c. The time limit for claiming such refund of tax paid on inward supplies of
goods or services or both have been enhanced from 6 months to two
years from the last day of the quarter in which the said supply was
received.
d. Section 54, by way of an insertion of an explanation, has clarified that
the relevant date for filing a refund application in case of supplies made
to an SEZ Developer/ SEZ unit shall be the due date for furnishing of
return in respect of such supplies.
e. Section 54(10) of the CGST Act, 2017 is proposed to be amended to widen
the scope of withholding of or recovery from refunds in respect of all
types of refund. Any taxpayer who has defaulted in furnishing any
return/payment of tax, interest, and late fees, then the proper officer
may withhold payment of refund due or deduct from the refund due, any
tax/fees which the taxable person is liable to pay.

46
14.GST Portal
a. Retrospectively from 22nd June 2017 the website “www.gst.gov.in” has
been notified as to the Common Goods and Services Tax Electronic
Portal, for all GST functions other than e-way bill and generation of
invoices.
15.GST Rate Notifications
a. Supply of unintended waste generated during the production of fish
meal (falling under heading 2301), except fish oil, is proposed to be
exempted from tax with retrospective effect from 1st July 2017, till 30th
day of September 2019 (both days inclusive), subject to the condition
that if said tax has been collected, the same would not be eligible for a
refund.
b. Service by way of grant of alcoholic liquor license, against license fee or
application fee, is neither a supply of goods nor a supply of service under
Section 7(2)(b) of CGST Act, 2017 as per Notification 25/2019 dated
30th September 2019. The same is proposed to be made effective
retrospectively from 1st July 2017. However, no refund shall be made of
tax collected, but which would not have been so collected, had the said
notifications been in force at all material times.

47
This booklet is a compilation of views purely with academic interest and for the reader to get an
additional perspective about the Direct & Indirect Tax related proposals in this Union Budget 2022.
The views expressed herein are only to impart knowledge and should not be construed as a legal
opinion. The firm or any of the contributors are not responsible for any kind of outcome from the
decisions taken based on this document.
DISCLAIMER

48
Team APMH……
Email id: info@apmh.in
Website: www.apmh.in

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