In the midst of the shutdown of businesses all over India to contain the spread of the highly contagious Covid-19 infection, Finance Minister Smt. Nirmala Sitharaman today addressed a press conference on various statutory and regulatory compliance issues and announced a slew of measures for providing relief amid the pandemic outbreak.
The brief highlights of the announcements made by the Finance Minister:
Income Tax, GST and Indirect Taxes related updates:
- For the FY 2018-19, the last date for filing of income tax returns has now been extended from March 31 to June 30th, 2020. For delayed payments, interest rates have been reduced from 12% to 9%.
- ‘Vivad se Vishwas scheme’ has been extended till 30th June, with zero penalty and interest thereby benefiting those businesses which have past liabilities which have significant accumulated interest liabilities. Those availing the scheme by the extended deadline will not have to pay 10 per cent interest on the principal amount.
- The due date for filing March, April, May GST Returns & Composition Returns has been extended till 30thJune 2020. For companies with less than ₹ 5 crore turnover, no interest, late fee or penalty will be charged. However, for bigger companies, only interest but no late fee and no penalty for GST.
- In case of delayed deposits of TDS, only reduced interest rate of 9% will be charged on delayed deposits till June 2020. No extension of deadline in this case.
- The due dates for issue of notice, intimation, notification, approval order, sanction order, filing of appeal, furnishing of return, statements, applications, reports, any other documents and time limit for completion of proceedings by the authority and any compliance by the taxpayer including investment in saving instruments or investments for roll over benefit of capital gains under Income Tax Act, Wealth Tax Act, Prohibition of Benami Property Transaction Act, Black Money Act, STT law, CTT Law, Equalization Levy law, Vivad Se Vishwas law and GST laws where the time limit is expiring between 20th March 2020 to 29th June 2020 shall be extended to 30th June 2020.
- Aadhaar-PAN linking deadline extended from March 31st to 30th June 2020.
Finance related updates:
- Bank charges reduced for digital trade transaction for all trade finance consumers and minimum balance charges waived off for all bank accounts.
- Debit card holders who withdraw cash from any ATMs can do it free of charge for 3 months.
Corporate Affairs and IBC updates:
- Under the Insolvency and Bankruptcy Code, 2016 (“IBC”) the existing threshold for triggering insolvency has been raised from current ₹1 lakh to ₹1 crore with the intent to protect MSMEs. Further section 7, 9 and 10 of IBC may be suspended for six months to stop companies being forced to insolvency, if the current situation continues beyond 30th April 2020.
- The mandatory requirement of holding meetings of the Board of the companies within prescribed interval provided in the Companies Act, 2013 (“Companies Act”) i.e. 120 days shall be extended by a period of 60 days till next two quarters i.e., till 30th September.
- The applicability of companies’ auditor’s report order 2020 (“CARO 2020”) will now be effective from the Financial Year 2020-2021 instead of 2019-2020.
- As per Schedule 4 to the Companies Act, Independent Directors are required to hold at least one meeting without the attendance of Non-independent directors and members of management. For FY 2019-20, if independent directors have not been able to hold even one meeting, it will not be a violation under the Act.
- Non-compliance of minimum residency in India for a period of at least 182 days by at least one director of every company, under Section 149 of the Companies Act, shall not be treated as a violation.
- For newly incorporated companies, 6 additional months shall be given to file the declaration for Commencement of Business.
- No additional fees shall be levied for late filing during a moratorium period from 01st April to 30th September 2020, in respect of any document, return, statement etc., required to be filed in the MCA-21 Registry, irrespective of its due date.
Custom related updates:
- Customs clearance now declared as an essential service, till June 30th, 2020 and shall be working 24*7.
- The due date for issue of notice, notification, approval order, sanction order, filing of appeal, furnishing applications, reports, any other documents etc., time limit for any compliance under the Customs Act and other allied Laws where the time limit is expiring between 20th March 2020 to 29th June 2020 shall be extended to 30th June 2020.
The necessary legal circulars and legislative amendments for giving effect to the aforesaid relief shall be issued in due course by various departments and ministries.