CA Manish Mish₹a

Dismisses challenge to show cause notice premised on audit findings : HC Delhi Magicon Impex Private Limited Ruling : Delhi HC dismisses challenge to show cause notice (SCN) by holding that “SCN may be premised on the findings of the audit report, the same is within the statutory framework.”; Pursuant to an audit, SCN as per section 74 was issued; On receipt of multiple audit memos, the same not only indicated the findings of the auditors, but also called upon the assessee to pay tax as determined, along with the interest and penalties as applicable; Besides, clarifies that “Any irregularities in issuing the audit memos does not impinge the validity of the impugned SCN”; Thus, concluding that SCN cannot be set aside at ‘threshold stage’ disposes of the petition with a direction to Adjudicating Authority to consider the response to SCN, if filed by Assessee #GST #GSTLitigation #GSTUpdates #GSTCompliances #GSTNews

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"Cap on NRI / OCI / RI contributions in FPIs relaxed for IFSC based funds" The IFSCA vide Circular dated 2 May 2024 had earlier announced SEBI’s approval for the following 2 alternative routes permitting increased participation by NRIs and OCIs in Indian securities through IFSC based FPIs: Alternative Route 1: FPIs to submit PAN and other KYC documents of all their NRI/OCI/RI individual constituents, along with their economic interests in the FPI, to the DDP. Alternative Route 2: The above KYC documents not required to be submitted by IFSC based FPIs, however they will be required to satisfy specified conditions. Pursuant to the above, the SEBI (FPI) Second Amendment Regulations, 2024 were notified on 26 June 2024, to inter alia, provide flexibility of having up to 100% aggregate contribution by NRIs, OCIs and RI individuals in the corpus of IFSC based FPIs. In view of the same, on 27 June 2024, the following amendments were announced to the SEBI Master Circular for FPIs: • At the time of registration, applicant to submit declaration of its intent to have aggregate contribution, of NRIs, OCIs and RI individuals of 50% or more of its corpus. Existing IFSC based FPIs can also opt for this by filing a declaration with the DDP by December 2024 • In case of Alternative Route 1, applicants to provide documents like PAN, Indian passport, OCI card, Aadhaar, etc. of all its constituents. These documents are also to be provided in case of NRI / OCI / RI holding 50% or more in a non-individual constituent of an FPI • Under Alternative Route 2, the following conditions have been specified: - All investor contributions in the FPI to be pooled in a single investment vehicle (no side vehicles) - Corpus of the FPI to be a blind pool with no segregated portfolios and investors to have pari-passu and pro-rata rights (separate classes permitted only for different currencies) - Investment in a single listed Indian entity cannot exceed 20% of corpus - FPI to atleast 20 investors, single investor contribution not more than 25% of the corpus - Only AMCs of mutual funds registered with SEBI and sponsored by a bank regulated by RBI (or IFSC based branch / subsidiary of such AMC) can be the investment manager. No investor has a say in the investment decisions of the FPI. • The above requirements to be fulfilled irrespective of the actual aggregate contribution of NRIs/OCIs/RI individuals in the corpus of the FPI. Swapnil Panhale Mugdha Godbole P S G S & CO LLP #fpi #ifsc #giftcity #investinindia #foreigninvestments #sebi #ifsca

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📢 Exciting News: GSTR-1A Coming Soon! 📢 I'm thrilled to announce that a significant update is on the horizon for the GSTN portal. The new Form GSTR-1A will soon be introduced, providing a much-needed enhancement for taxpayers. 🆕 What's Changing? 🔹 Flexibility in Amendments: Currently, taxpayers cannot modify GSTR-1 in the same period after it has been filed. Any amendments or missed records must be reported in the GSTR-1 of the next return period. 🔹 Introducing GSTR-1A: To simplify this process, GSTR-1A will allow taxpayers to amend or add records within the same month after filing GSTR-1 and before filing GSTR-3B. This ensures timely and accurate corrections. 🔹 Automatic Liability Adjustment: The amended liability will be automatically populated in GSTR-3B, enabling correct liability discharge. 📊 Key Impacts: 1. Same-Period Modifications: Taxpayers can modify GSTR-1 in the same return period. 2. Efficient Reporting: Amendments or missed records can be reported in GSTR-1A before filing GSTR-3B. 3. Downstream Effects: This update will impact forms like GSTR-2A, GSTR-2B/2BQ, GSTR-3B/3BQ, GSTR-4A, GSTR-6A, GSTR-9, GSTR-11, tax liabilities, and ITC comparison. 4. Monthly Amendment Process: Amendments in GSTR-1A cannot be amended again in the next month's GSTR-1. Only unamended records can be modified in the next period's GSTR-1. This upcoming feature is a game-changer, aiming to make the GST filing process smoother and more efficient for all taxpayers. Stay tuned for more updates as we get closer to the launch!

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Revised Criteria for classification of Non-company entities for applicability of Accounting Standards ICAI has issued an Announcement regarding the change in the applicability of Accounting Standards for non-company entities. For accounting periods commencing on or after April 1, 2024, non-company entities are now classified into 2 categories instead of 4 levels: 1. Large entities - Turnover above 250 Crore and Borrowings above 50 Crore; and 2. Micro, Small & Medium Sized Entities (MSMEs) - Turnover below 250 Crore and Borrowings below 50 Crore Exemptions/ relaxations which were available to non-company entities earlier classified under Level III & IV have been extended to all MSMEs except AS 18 & AS 28 which are applicable to non-company entities with Turnover below 50 Crore and Borrowings below 10 Crore. The said changes would bring reduced compliance for MSMEs without having a major impact on classification and recognition criteria and will be applicable for preparation & presentation of financial statements of sole proprietorships, LLPs, partnerships, etc. from FY 2024-25 onwards. #kcrkcollp #MSME #AccountingStandards #MBF

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Very important and useful webinar for all income tax practitioners Recent Income tax Judgements and it's critical analysis 23rd May 2024,Thursday 4.00 to 5.30 PM ZOOM Registration Link: https://lnkd.in/dXEtS9-F Zoom ID: 853 4891 5310 ZOOM PD : 1234 #incometax #incometaxjudgements #goi #icai #ca #taxprofessional #taxconsultant #taxation

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The TPB has issued draft information sheet TPB(I) D54/2024 False or misleading statements to the TPB or Commissioner. The draft information statement provides guidance on tax agent obligations under section 15 of the Determination. Whilst the efforts of the TPB in providing guidance are appreciated, the guidance is very legalistic and unclear. Material is material unless it’s not material and reasonable is reasonable in the circumstances but more than 5 days is likely to be unreasonable. All tax agents should be VERY concerned by approach taken by the TPB in the draft guidance. Practitioners will no doubt need to seek legal advice to determine their reporting obligations. Clients and/or tax agents could face civil & criminal penalties where false, incorrect or misleading material particulars are a) made and b) not corrected within a reasonable time. Case study 6 indicates a reasonable time to correct a false, incorrect or misleading statement (e.g., incorrect work related deductions) is 5 days after being notified of the requirement to correct the statement. Tax agents will not be required to correct the statement if the client refuses, but will be required to notify the Commissioner of the details of the statement. I have concerns the recommendations of the TPB for tax agents to notify a client in writing of the nature of the false, incorrect or misleading statement, the requirement to correct the statement and the potential civil & criminal penalties could stray into the provision of legal advice. With critical shortages of skilled staff & an ever increasing administrative burden (not to mention the impacts of CAL & ATO staff shortages), the 5 business days reasonable correction period in Example 6 is just not realistic. All tax agents (including tax agents who work in Tax Clinics) should be prioritising reading this guidance and giving consideration to how practically this will impact on them going forward. Powerball is $30 million this week….. (Views expressed are my own) #tax #taxagents #TPB

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Please note a very important change in the applicability of #AccountingStandards for non-company entities issued by the ICAI. For accounting periods commencing on or after April 1, 2024, non-company entities are now classified into 2 categories instead of 4 levels: 1. Large entities - Turnover above 250 Cr and Borrowings above 50 Cr; and 2. Micro, Small & Medium Sized Entities (MSMEs) - Turnover below 250 Cr and Borrowings below 50 Cr Exemptions/ relaxations which were available to non-company entities earlier classified under Level III & IV have been extended to all #MSMEs except AS 18 & AS 28 which are applicable to non-company entities with Turnover below 50 Cr and Borrowings below 10 Cr. The said changes would bring reduced compliance for MSMEs without having a major impact on classification and recognition criteria. The link to access the Revised Criteria for applicability of Accounting Standards for Non-company entities is available at https://lnkd.in/gMu6mWt9 Please ensure compliance with accounting standards for preparation & presentation of financial statements of #soleproprietorships, #partnerships, etc. accordingly from FY 2024-25 onwards. Warm Regards

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Further amendments in SRO 350 notified today, to relax some earlier issued #restrictions introduced for #filling / #Uploading of monthly #salestax #Returns including #declaration of #capital as well. #business community and compliant #taxpayers were facing unprecedented challenges. #taxplanning #taxcompliance #taxfillingservices #tafqathussainca

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Join us today for the Panel Discussion on "2nd Accounting Standards Day" starting at 02:30 PM at NDMC Convention Centre, CP, New Delhi. We'll be joined by experts to delve into the below:- 📌 Framework, Formats & Applicability of Accounting Standards 📌 Critical aspects of assets related standards 📌Critical aspects of Liabilities & Expense related standards 📌 Critical aspects of Revenue related standards For further details refer attached flyer. #AccountingStandardsDay #Accounting #NewDelhi

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Conversion of physical shares into Dematerialisation format. Currently shares of entities listed on the stock exchange are traded in Demat form. Now onwards this compliance is further extended to Private Limited Companies, as notified. On the one hand it has benefits that companies can reduce the frauds on illegal transfer of shares and can have better control over the transfer of shares when hands are changed. On the other side there is a compliance burden on the companies as well as shareholders. Many foreign companies shareholders are enquiring a lot on account of this additional compliance, especially during the first year, and a common question in the industry is, Is it really an ease of doing business in India ? MCA should consider to further extend it's applicability on all types of private limited companies, even if they are other than small companies, as defined. #compliance #mca #india #easeofdoingbusiness

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ICAI Releases SQM 1 and SQM 2: A Game-Changer for Audit Firms ICAI has introduced two new standards—SQM 1 (Quality Management for Firms) and SQM 2 (Engagement Quality Reviews)—to elevate quality management in audit firms. SQM 1: Quality Management for Firms ✅Applicable to firms conducting audits, reviews, and assurance services. ✅Focus: Establishing a risk-based quality management system covering leadership, ethics, client acceptance, performance, resources, communication, and monitoring. SQM 2: Engagement Quality Reviews ✅Applies to engagements requiring independent quality reviews. ✅Ensures engagement quality through competent, independent reviewers, covering significant judgments and documentation. Challenges for Non-Big Four Firms ✅Resource constraints, training, and technology adaptation. Preparedness Tips ✅Early implementation, staff training, resource allocation, and investment in audit technology. By addressing these areas, Non-Big Four firms can smoothly transition to the new standards and uphold high-quality engagements. Ref the link to download standards #NFRA #Audit #ICAI #StandardsonAudit

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• The NFRA fined M/s Venkatesh & Co ₹2 crore for professional misconduct in the 2019-20 Coffee Day Enterprises audit. • Auditors Dasaraty V and Desikan G were banned for 10 and 5 years, respectively. • Dasaraty was also fined ₹10 lakh, and Desikan ₹5 lakh. • The penalties stemmed from a Sebi report revealing a ₹3,535 crore fund diversion from Coffee Day subsidiaries to Mysore Amalgamated Coffee Estate Limited. • The auditors failed to report the fraud and protect public interest. • The order will take effect after 30 days. • In August, NFRA fined KPMG affiliate M/s BSR & Associates LLP ₹10 crore and debarred two auditors for lapses in the 2018-19 Coffee Day audit.

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NFRA vs. ICAI: The Audit Standards Debate The National Financial Reporting Authority (NFRA) and the Institute of Chartered Accountants of India (ICAI) are at odds over proposed changes to audit standard SA 600 ¹ ². What's the Issue? NFRA wants to align SA 600 with international standards, making principal auditors accountable for subsidiary audits. ICAI fears this will concentrate the audit market in a few hands, harming small practitioners ¹ ². Key Concerns: - Concentration of Market: ICAI worries that revising SA 600 will lead to bigger firms dominating the audit market, pushing out smaller firms ¹. - Principal Auditor's Responsibility: NFRA proposes holding principal auditors accountable for subsidiary audits, which ICAI believes is unfair ². - Impact on Small Firms: ICAI claims that 97,000 small CA firms will be affected if NFRA's changes are implemented [2). The Way Forward: ICAI suggests improving processes and implementing additional checks and balances instead of revising SA 600 ². NFRA's goal is to enhance audit quality and reliability, crucial for India's growing economy ¹. https://lnkd.in/gqBgbm5Q Share your thoughts on this controversy. How can NFRA and ICAI find a balance between audit quality and supporting small practitioners? Let's discuss! 💬 #NFRA #ICAI #AuditStandards #SA600 #Accounting #Finance #India

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#SEBI on 22 May has released a consultation paper seeking feedback on proposed amendments to the #BRSR framework both from the perspective of prepares and also the level of rigour of assurance. One of the key changes proposed is to move away from #reasonableassurance to assessment (guidelines to be issued by industry bodies). It will be interesting to see how this pans out including the guidelines especially in context of most jurisdictions globally moving towards limited assurance! Last date to provide comments is 12 June - please do provide feedback! #ESG #SustainabilityReporting #Sustainability https://lnkd.in/gVFjFhSj

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NFRA and ICAI at Odds Over Plans to Sync Audits with Global Norms! Who is NFRA?   The National Financial Reporting Authority (NFRA) is an independent regulator overseeing the auditing profession and Indian Accounting Standards under the Companies Act 2013. Why are NFRA and ICAI at odds, despite both working for the betterment of auditors?   The tension arises from differing roles and regulatory approaches. The Institute of Chartered Accountants of India supports self-regulation and auditor interests, while NFRA focuses on stricter oversight, emphasizing public interest and audit quality. This divergence creates friction as both strive for auditor improvement. NFRA’s draft norms overhaul the existing Standard on Auditing (SA) 600, affecting listed companies and banks, except state-run ones.  ICAI fears that these norms could concentrate audit work among larger firms, adversely impacting small and medium practitioner firms. ICAI also opposes mandating principal auditors to assess the competence of component auditors, arguing that all auditors share the same education, training, and licensing under ICAI. What is the take of other regulatory bodies? Despite these concerns, the Comptroller & Auditor General of India, Reserve Bank of India (RBI), and Securities and Exchange Board of India (SEBI) support aligning domestic audit standards with global ones. NFRA believes this revamp is essential to prevent corporate fraud by fostering greater accountability among auditors, whose work impacts millions of retail investors. #auditreforms #icai #nfra #auditquality #corporategovernance 

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Huge benefits expected for CAs ahead! The The Institute of Chartered Accountants of India (ICAI) is actively exploring deeper collaboration with Gulf Cooperation Council (GCC) countries, aiming to strengthen mutual recognition of CA qualifications.  This initiative is poised to benefit over 10,000 Indian CAs currently working in the Gulf region, while creating new opportunities for many more in the future. By establishing mutual recognition agreements (MRAs), Indian CAs can more easily access professional opportunities in GCC nations like the UAE, Saudi Arabia, and Oman, which collectively host over 8 million Indian expatriates.  As the Middle East continues to diversify its economies, the demand for skilled finance and accounting professionals is expected to grow, with the GCC financial sector projected to expand by 6-7% annually over the next few years. Key benefits for Indian CAs include: 1. Expanded Job Market Collaboration with GCC countries opens doors to a wider pool of opportunities in fast-growing sectors like finance, infrastructure, and oil & gas.  In 2022 alone, the UAE saw a 10% growth in finance-related jobs, a trend likely to continue. 2. Global Mobility With mutual recognition, CAs can work seamlessly across borders, gaining exposure to international standards and enhancing their career prospects.  Over 3,000 ICAI members are already registered in the UAE, showcasing the high demand for Indian CAs in the region. 3. Competitive Advantage Indian CAs are known for their expertise and rigorous training.  The mutual recognition of qualifications will allow them to compete effectively in the GCC’s competitive job market, where the financial sector contributes nearly 20% to the region's GDP. This initiative will not only enhance the global relevance of Indian Chartered Accountants but also strengthen the professional ties between India and the The Cooperation Council for the Arab States of the Gulf (GCC). #icai #gcc #charteredaccountants #globalopportunities  #icaiinitiatives #careerexpansion

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Revision in SA 600 is being debated in many forums to bring in line with ISA 600 and relevant to signing of opinion by the Principal auditor (P) on consolidation of accounts while relying on work of subsidiary auditor (S).The last major revisions of the standards ( Clarity project ) was done in 2008-10 by ICAI. The major arguments in favour of maintaining status quo (even after 2 decades ) are as follows : 1. Both P& S are CA firms therefore P cannot judge the competency , irrespective of the size,quality, experience etc of S. 2.Access to working papers of S is not allowed . Following pertinent questions remain : a. Has P done enough work to issue Reasonable opinion ( true & fair )by putting an exception regarding relying work done by S ? is this a compilation exercise on xcel sheet ? b Is divided responsibility between P&S tenable in the court of law ? c.should S have any objections to access by P ,regulations permitting,if quality audit as per relevant professional standards has been performed ?ICAI has so many avenues to train their members appropriately d.How long will ICAI carry the burden of protecting its members from competition ( what if the sector opens up ? ) at the expense of adopting global best practices. e.Relevance of consolidation in laws and regulations apart from compliance of accounting standards ,disclosures etc . for example Dividend is paid out of standalone accounts. f.How does the audit committee of Boards of companies view this debate ? They have the responsibility towards the stakeholders on consolidation of accounts ?

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WIRC of ICAI presents its 2 Day Flagship M&A Conclave 2024 on 12th and 13th of July, 2024. Take a deep dive into the exciting world of Mergers & Acquisitions. The M&A Conclave 2023 was a resounding success and provided participants with 360 degree view of the M&A Process. This year, we are back with some very interesting sessions covering very niche facets of the M&A Process. This Conference is one stop destination for the M&A Professional. Take the privilege of hearing to the top minds in the M&A Industry. This Seminar is a must attend for all Professionals in the M&A Industry, as well as those who would like to enter this exciting and lucrative field. Unprecedented Opportunity to network with professionals in the M&A Space. Register now and secure your spot! https://lnkd.in/gnXEsr4j CA Ankit Rathi Gautam Lath CA Pinki Kedia CA Piyush Chandak Nsk Murtuza Kachwala CA Arpit Kabra CA Shweta Jain SOURABH AJMERA CA Ketan Saiya Vishal Gada Girish Vanvari Binoy Parikh Milin Mehta Hiten Kotak Rajeev Newar Vishal Joishar Ankit G. Davda Chetan Khandhadia Ketan Dalal Aseem Mankodi Pinkesh Billimoria Yusuf Hakim #Mergers #Acquistions #Restructuring #M&A #Professional Opportunities #M&A hashtag #BusinessRestructuring hashtag #Professionalopportunities hashtag #business hashtag #icai hashtag #funding hashtag #legal hashtag #opportunity

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