Questions? 

Non-filing of tax return despite of having taxable income carries penalty and prosecution exposure. Also, non-filing of tax return with negative income by due date prohibits the carry forward of such losses including the losses in the past years, if any, to the subsequent year for adjustment against subsequent year(s) positive income. Taxpayers are liable to furnish the tax returns even in situation where tax payable is negated by the taxes withheld by the customers.

Further, it may be noted that non-payment of tax, i.e., tax evasion can attract interest, penalty and prosecution.

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Yes, tax authorities can review the tax returns lodged by the taxpayers to verify that income and deductions reported by the taxpayers are accurate by serving notice as per the prescribed timelines

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To get certainty on tax position, a non-resident may consider seeking an advance ruling/private tax ruling.

The Authority for Advance Rulings (AAR) is an independent quasi-judicial body which issues advance rulings on income-tax matters. AAR rulings are binding on both the applicant and revenue authorities unless there is a change in law or facts.

Benefits:

• Upfront resolution of questions related to tax liability
• Avoid uncertainty and protracted litigation with revenue authorities
• Lower time cost vis-à-vis normal dispute resolution process

Currently there is a lot of pendency in the AAR due to non-functioning in the past. Hence the option may require to be evaluated from a timing perspective

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Primarily, in case where the location of the supplier and the place of supply are in same state it will be intra-state and where it is in different states it will be inter-state supplies, except in certain specified cases.

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Yes, there is a mechanism of reverse charge under the GST regime whereby the liability to pay tax is on the recipient of supply of goods and services instead of the supplier of such goods or services. Reverse charge is mostly triggered when a person imports services, receives supply of goods or services from an unregistered vendor and in respect of other notified categories of supply

For example, if a Chinese company enters into a contract for supply of services to a registered taxable person in India say its Indian subsidiary, then the onus of discharging the GST liability would be casted upon the Indian subsidiary.

However, in case of unrelated party contracts say government contracts, the bids/contracts preclude the customer from undertaking the GST liability and requires the same to be reimbursed once the GST liability is paid by the customer. In such cases, the GST liability may become cost in the hands of the Chinese company and further there maybe no option of obtaining credit of the said GST paid.

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Zero rated supply means export of goods and/or services or supply of goods and/or services to a SEZ developer or a SEZ unit.

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All exports are deemed as inter-state supplies. Exports of goods and services are treated as zero rated supplies. The exporter has the option either to export under bond/Letter of Undertaking without payment of tax and claim refund of ITC or pay Integrated Tax by utilizing ITC or in cash at the time of export and claim refund of Integrated Tax paid.

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Every supplier (including his agent) who makes a taxable supply, i.e., supply of goods and / or services which are leviable to tax under GST law and whose aggregate turn over in a financial year exceeds the threshold limit of INR 4 million is liable to register himself in the state or the union territory of Delhi or Puducherry from where he makes the taxable supply.

In case of eleven special category states, this threshold limit for registration liability is INR 2 million.

Besides, GST provisions mentions certain categories of suppliers who shall be liable to take registration even if their aggregate turnover is below the said threshold limit of INR 4 million.

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Yes. A person having SEZ unit or being SEZ developer shall have to apply for a separate registration, as distinct from his place of business located outside the SEZ in the same state or union territory.

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• Tax Deducted at Source (TDS) is required to be paid by certain categories of registered persons to the government account
• Tax Collected at Source (TCS) is required to be paid by e-commerce operator

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