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CIRC NewsletterCentral India Regional CouncilThe Institute of Chartered Accountants of India

March, 2020

(Set up by an Act of Parliament)

Sitting (L-R):

Standing (L-R):

Chairman CICASA, CA. Dinesh Kumar Jain- Secretary CIRC, CA. Devendra Kumar Somani- Chairman CIRC, CA. Atul Mehrotra- Vice Chairman CIRC, CA. Shashikant Chandraker- Treasurer CIRC,CA. Satish Kumar Gupta- Council Member, CA. Abhisak Pandey- RCM.

CA. Nilesh Gupta- RCM, CA. Sachin Kumar Jain- RCM, CA. Pramod Kumar Boob- Council Member, CA. Manu Agrawal- Council Member, CA. Mukesh Bansal- RCM, CA. Churchill Jain- RCM, CA. Abhishek Sharma- RCM

CA. Anuj Goyal- Council Member, CA. Prakash Sharma- Council Member, CA. Atul Agrawal-

New Team ofCentral India Regional Council of

The Institute of Chartered Accountants of India2020-2021

www.circ-icai.orgCIRC Newsletter

2

Chairman Vice Chairman Secretary

Treasurer Chairman CICASA Regional Council Member

Regional Council Member Regional Council Member Regional Council Member

New Team CIRC

Regional Council Member Regional Council Member

CA.Devendra Kumar Somani CA. Atul Mehrotra CA. Dinesh Kumar Jain

CA. Shashikant Chandraker CA. Atul Agrawal CA. Abhisak Pandey

CA. Abhishek Sharma CA. Churchill Jain CA. Mukesh Bansal

CA. Nilesh Gupta CA. Sachin Kumar Jain

From the Desk of Chairman...CA.Devendra Kumar Somani

Chairman CIRC & Chief Editor CIRC Newsletter


3

Respected Professional Colleagues,

“On the road to success, the rule is

always to look ahead….”

It is a great honour for me to be able to

address you through this column. Before

my pen journeys goes further down the

page, I express my sincere gratitude to all

members of Regional Council and my fellow

professionals for reposing their trust and

faith in me and electing me as Chairman of

Central India Regional Council.

The world is passing through extremely

testing and unprecedented times due to

CORONA virus and As very rightly said by

the Hon'ble President of ICAI that, the

C O V I D - 1 9 p a n d e m i c m a r k s a n

unprecedented tie in modern history that

will require the best of humanity to

overcome. Little would have we realised the

unfolding of epidemic like this, which

situation is yet unfolding, and have brought

the economic momentum to a much lower

trajectory. Situation like this would need

s u p p o r t t o c o l l a b o ra t e w i t h t h e

government initiatives to scale up

government efforts to help those in

distress. At this moment, the affected

people will need help to tide over the viral

disease, and in this scenario, the ICAI has

decided to stand with our distressed fellow

countrymen, and actively participate in the

national effort to support them at this

difficult time. Due to the ongoing lockdown,

much needed on the ground of social

distancing and therefore 'stay home'

advisory from the government; some of

fellow countrymen will need extensive

support from the government and

therefore, I appeal all members, students &

their families to contribute to the

government initiatives to bolster necessary

infrastructure and human ware to fight this

epidemic.Such generous donations can be

given in the “ICAI COVID 19 Relief Fund”

a s p e rd e t a i l s p rov i d e d i n t h i s

Newsletter.

Further, I wish and request all the members

to stay at home as “Now that the virus has a

foothold in so many countries, the threat of

a p a n d e m i c h a s b e c o m e v e r y

real.”Surely,it's temporary, but it's a

tornado-like headwind, so it's going to be

powerful for a period of time.

At the same time, I humbly request you to

guide me during my tenure to enable us,

together, to take this Region to greater

heights. Your continuing support will help

the Region to bring in more laurels, thus

inspiring the next generation to carry this

torch forward and take ICAI towards higher

professional excellence.

Our goals at the beginning of the year are

very clear. We are creating a point agenda

for the development of Members, Students

and the Region at large and these points will

become the focus areas for the year. We

want to make this year as the 'Year of

Action'. I'm pleased to state that with the

enthusiastic support of Regional Council

Members, Branches and Study Circles who

From the Desk of Chairman...CA.Devendra Kumar Somani



4

stood united in their belief that 'Together We Can' we

can transform the year into vibrant and dynamic.

With the changing paradigms of education, which holds

no space for rote learning and passive listening, we will

continue in future to provide our students with

opportunities and situations that facilitate them to

exhibit their hidden potential to the fullest. I strongly

believe that the generation today has an unquenchable

thirst to seek knowledge that cannot be satiated by

traditional methods of teaching.

I again express my gratitude for the enormous support

and faith reposed in me by every member and student. I

am confident that the incoming Office Bearers and this

Council will take CIRC to greater heights and I offer my

complete support.

I am sure that the CIRC team will focus on their

cherished goals and strive hard to accomplish them by

constantly endeavoring for excellence.

Best wishes for a very eventful and productive year!

Let us remember that 'Success is not only measured by

what we accomplish, but more so by the endeavour of

all concerned to strive as a team, with courage against

overwhelming odds to cross the finish line together'.

Warm regards,

CA.Devendra Kumar SomaniChairman CIRC

9610556057, [email protected]


5

Being a Fellow Member of the

Institute with about two decades of

professional experience, his

proactive and whole hearted

a p p r o a c h t o w a r d s m a t t e r s

concerning excellence of profession

and his unique qualities made

majority members to foster his

candidature for elections of Regional Council Member of

CIRC of ICAI even from the smaller town of Udaipur in

Rajasthan in the year 2019. His caliber led him to emerge as

a winner and he became Regional Council Member for the

term 2019-22. Moving forward, his sprightliness and

excellent approach towards his duties led him to be elected

as the Chairman of Central India Regional Council of ICAI

for the year 2020-21 on 29th February, 2020.

A man of stupendous vision, professional vigour and

colossal discipline, CA. Devendra Kumar Somani is a rank

holder in CA Foundation Examination. He has qualified

Chartered Accountancy in 1999. He has also qualified

Information System Audit course, Certificate course on

Concurrent Audit of Banks and Forensic Audit & Fraud

Detection conducted by ICAI and passed Debt Recovery

Examination of the Indian Institute of Banking & Finance.

CA. Somani is founder partner of M/s Sarupria Somani &

Associates, Chartered Accountants having its wide

presence in 9 States across the country.

He has always contributed to the cause of profession and

has held many important positions in the past, viz;

•Executive member of Western India Chartered

Accountants Students Association during 1995-96 and

1996-97.•Entrusted with responsibilities in various committees

constituted by Regional Council of CIRC of ICAI and

Udaipur Branch such as Member, Regional Budget and

Finance Committee of CIRC of the ICAI in the year 2020-21,

ex-officio member of the Managing Committee of Udaipur

Branch of CIRC of ICAI in the year 2003-04, 2019-20 &

2020-21, member of Regional Monitoring Committee of ICAI

in 2004-05, member of Branch Co-ordination Committee of

CIRC of ICAI in 2016-17 and Member of Professional

Development Committee of CIRC of ICAI in 2017-18.

•Member of the Managing Committee of Udaipur Branch for

2013-16 and it’s Vice-Chairman in 2013-14. •Penal expert on GST matters for resolving queries raised by

the readers of Dainik Bhaskar, a leading daily Hindi news

paper. •Chairman, GST Cell of Udaipur Chamber of Commerce &

Industry for 2017-18.•Co-chairman of GST Sub-committee of Udaipur Chamber of

Commerce & Industry in 2018-19.•Chairman of Central India CA Student Association (CICASA)

of CIRC of the ICAI in 2019-20. •Ex-officio member of the Managing Committee of

Kishangarh, Beawar and Jamshedpur Branches of CIRC of ICAI

in the year 2019-20 and Bhilwara, Ranchi and Varanasi

Branches for the year 2020-21.

As Chairman of the Regional Council of CIRC, CA. Somani is

also member of Regional Budget & Finance Committee of ICAI

for the year 2020-21.

He has also authored a book titled ‘A Complete Guide to

Housing Loan’. He is privileged to be speaker on the subjects of

professional interests like NPAs Management, TDS, Service

Tax, GST, Analysis of Union Budget etc. on various forums. He

is also regularly contributing his professional views in media

on tax, financial and other matters and being thoroughly

conversant with the professional concerns and demands of

the time, always given his full intellectual and technical

support, which is invaluable for professional brothers.

CA. Devendra Kumar Somani alongwith his wife CA. Rekha

Somani established a “Super-10 Group” for needy & less

privileged students who have a dream to become CA.

With his commitment, dedication and service to the

profession, he endeavours to take the profession to newer

zeniths and also come up to the expectations of fellow

members.

About ChairmanCA.Devendra Kumar Somani


ICAI COVID 19 Relief Fund


6

The COVID-19 pandemic marks an unprecedented time in modern history that will require the best of humanity to overcome. Little would have we realised the unfolding of epidemic like this, which situation is yet unfolding, and have brought the economic momentum to a much lower trajectory. Situation like this would need support to collaborate with the government initiatives to scale up governmental efforts to help those in distress. At this moment, the affected people in India will need help to tide over the viral disease, and in this scenario, ICAI has decided to stand with our distressed fellow countrymen, and actively participate in the national effort to support them at this difficult time. Due to the ongoing lockdown, much needed on the ground of social distancing and therefore ‘stay home’ advisory from the government; some of our fellow countrymen will need extensive support from the government. Further, we need to contribute to the government initiatives to bolster necessary infrastructure and human ware to fight this epidemic.

To provide much-needed relief for the people affected by the viral disease and those who are in distress; ICAI appeals to all its Members and Students to donate generously for this noble cause.

Donations can be made through Demand Draft, Cheque, RTGS and online mode; offline collections in form of cheques/demand draft should be given in the name of “ICAI COVID 19 Relief Fund”. All such offline contributions can be made in the ICAI Bank Account having the following details:

Bank: HDFC BankAccount No.: 50100098409265IFSC No: HDFC0000590

The collected amount will be given to PRIME MINISTER’S NATIONAL RELIEF FUND. All contributions towards this Fund are exempt from Income Tax under Section 80G. The donors are requested to give their name, membership number /student registration number, address, amount and date of contribution, PAN details (if any) so that receipts could be obtained from Prime Minister’s National Relief Fund for onward transmission to the donors. The letter/email can be sent to:

The Additional Secretary M&C-MSS The Institute of Chartered Accountants of India ICAI Bhawan A-29, Sector-62 Noida-201309 Email: [email protected]

Looking forward for your generous contribution in these special circumstances in the interest of mankind.(CA. Atul Kumar Gupta)

President ICAI

CA. Dinesh Kumar JainSecretary CIRC


7

Respected Professional Colleagues,

The occasion to rise to the post of Secretary of

CIRC, geographically the largest region of The

Institute of Chartered Accountants of India

brought with it a sense of mixed emotions of

joy, of pride, of honour, and of responsibility to

me. I am thankful to Almighty, my friends and

relatives and specially all of you for showing

confidence in me again and again to take new

responsibilities. These feelings are even more

heightened when I am writ ing this

communication, being my first communication

to the members of Central Region of our

esteemed Institute as the Secretary of CIRC.

As of now entire globe is entrapped with

outbreak of Corona Virus, India being a

densely populated nation needs to be

proactive at all times in such a pandemic. ICAI

have also committed themselves for more and

more of virtual and digital learning & CIRC

shall leave no stone unturned to dissimilate

knowledge and updating its members through

various innovative modes.

I would also like to bring to your notice that our

President has been receiving spontaneous

and innumerable requests for making

generous donations to support the

government in the wake of this emergency

from various branches of CIRC & all other

regions. Keeping in mind a dedicated fund

named ICAI COVID-19 relief fund with the

primary objective of contribution of our ICAI in

this distress situation has been set up. Those

who are personally connected with me

already must have received my request, with

this communication, I am again requesting to

all of you to generously donate in this fund to

serve the humanity & reassuring government

that ICAI through its members is truly a partner

in nation building.

We now begin the planning for the 2020

events and hope maximum participations

from every member of our region. I can

assure you that CIRC programmes will now

be completely in lines with our ICAI

Presidents vision document.

I see a lot of consultation papers along with

suggestions sought from various ministry of

Indian government, the same is also sent to

members for their inputs. I through this mode

wants to make a personal request to be

participative in providing your views and

suggestion to our branches or region to

overcome turbulent time in our economy.

I am a believer that a satisfied life is better

than a successful life because our success is

measured by others. But our satisfaction is

measured by our own soul, mind and heart.

Ability is a good thing but stability is even

better. Don't just dream about success, work

for it and achieve it. Winners are not people

who never fail, but people who never quit. So

don't quit until you hit the success.

I would like to make a reference to a quote

before concluding my communiqué through

this column to emphasize the need to achieve

excellence, whether personal, professional or

in any other field that one choose as a career.

“The will to win, the desire to succeed, the

urge to reach your full potential - These

are the keys that will unlock the door to

personal excellence."

Warm Regards,

Sd/-

CA. Dinesh Kumar JainSecretary CIRC

9414073452, [email protected];

From the Desk of Secretary...

Pg. 02

From the desk of Chairman CIRC

From the desk of Chairman CICASA of CIRC

New Team CIRC

From the desk of Secretary CIRC

Pg. 03 - 04

Pg. 07

Pg. 05

Pg. 06

Pg. 10 - 12

Pg. 13 - 16

Pg. 17 - 22

Pg. 23 - 33

Pg. 38

Pg. 39

Pg. 43

Pg. 44

Pg. 50

Pg. 34 - 36

Pg. 47 - 49

Pg. 40 - 42

Pg. 45 - 46

Member’s Section

Student’s Section

INDEX

Announcements

Events

Events

Editorial Board

Celebrating the Past & Inspiring the Future: By- CA. Arjit Agarwal

Eye Share: Necessity of ITC Reversal on Goods/Services Used Exclusively for 'Exempt Supplies' - A Legal Mystery!: By - CA.Chirag Jain / CA.Shuchi Sethi

A presence of just one question mark can delete penalty u/s 271(1)(C ) of the I.T Act,1961:By- CA. Prarthana Jalan


8

FAQ: Articleship Training - The Back Bone of CA Course

Let’s Talk About Mental Health

Announcement

Self Driven Learning

ICAI COVID 19 Relief Fund

How to clear CA exams: By - CA. Sheetal Agarkar

About Chairman


9

ARTICLES


10

Eye Share: Necessity of ITC Reversal on Goods/Services Used Exclusively for'Exempt Supplies' - A Legal Mystery!

Introduction

Input Tax Credit has always occupied an important

place in the indirect taxes. Input tax credit in the

erstwhile cenvat provisions was the backbone of the

Cenvat Credit Rules. Similarly, the input tax credit is

the backbone of the GST law, accordingly the scheme

has been incorporated in the statute itself in such a

way that all the enabling provisions such as eligibility,

availment, limitation, apportionment, reversals, etc.

have been incorporated in the act itself, of course with

the machinery being prescribed by the delegated

legislation.

Apart from the eligibility tests provided in Section 16,

Input Tax Credit also has to pass the restrictions of

Section 17. One such restriction is that credit of input

tax on the goods and services used in effecting both

taxable as well as exempt supplies has to be restricted

to so much of theinput tax as is attributable to the

taxable supplies. This article aims to discuss the

eligibility of ITC on goods or services which are used

exclusively for the exempt supplies. Whether the

statute has laid out any restriction on such ITC or it is

merely a fallacy brought forward from the earlier

laws without any legal backing.

Position in erstwhile lawsThe provisions of input tax credit in the erstwhile

laws especially service tax and central excise were

governed by the cenvat credit rules (hereinafter

referred as “CCR”). While the provisions relating to

the eligibility and availment of cenvat credit

themselves were prescribed in CCR, the provisions

relating to the apportionment and reversals thereof

were also prescribed through CCR.

Rule 6 of the CCR explicitly stipulates that the

manufacturer or the service provider shall not be

allowed the credit on inputs or input services used in

or in relation to the manufacture of the exempted

goods or in the provision of exempted services.

Further, Rule 6(3A) provides that where the

manufacturer is engaged in the manufacturing of

both exempt goods or non-exempt goods or the

service provider engaged in providing both the

exempt services or non-exempt services as the case

may be, it shall be required to pay the cenvat credit

attributable to inputs and input services used

exclusively in or in relation tothe manufacture of

exempt goods removed or for provision of exempted

services as well as the common credit attributable to

the exempted goods removed or the exempted

services provides.

Hence, the erstwhile cenvat credit rules explicitly

stated for the reversal of the cenvat credit on input

and input services used exclusively in the

manufacture of exempt goods or provision of exempt

services where an entity is engaged in the supply of

both taxable as well as exempt goods or services.

Position in GST Regime

Unlike the cenvat rules in the erstwhile laws, the

enabling provisions of eligibility, availment,

apportionment, reversals, etc. have been prescribed

in the GST Act itself.

[email protected] Jain CA.Shuchi Sethi

[email protected]


11


With regard to eligibility, Section 16(1) provides

'Every registered person shall, subject to such

conditions and restrictions as may be prescribed

and in the manner specified in section 49, be entitled

to take credit of input tax charged on any supply of

goods or services or both to him which are used or

intended to be used in the course or furtherance of

his business…

Clearly, the above provision allows ITC on any

supply used for business and does not put any sort of

restriction on the ITC in respect of input tax charged

on goods or services used exclusively for exempt

supplies. Further, when one digs in for the search of a

provision for ineligibility or reversal of ITC on goods

or services exclusively used for exempt supplies, it

comes to the surprise that there is no such provision

in the entire Act.

As far as Section 17(2) is concerned, it only deals

with the common ITC i.e. ITC on goods and services

used partly for effecting taxable supplies and partly

exempt supplies and restricts such common ITC to

ITC attributable to taxable supplies only. Section

17(2) in itself does not provide for reversal of ITC in

cases where there is no common ITC.Section 17(2) is

produced hereunder for reference:

(2) Where the goods or services or both are used by

the registered person partly for effecting taxable

supplies including zero-rated supplies under this

Act or under the Integrated Goods and Services Tax

Act and partly for effecting exempt supplies under

the said Acts, the amount of credit shall be restricted

to so much of the input tax as is attributable to the

said taxable supplies including zero-rated supplies.

In fact, Rule 42 and 43 prescribed for the

apportionment (although not empowered by

Section 17(2) itself), do not aim to reverse the ITC

used exclusively in effecting exempt supplies. These

rules only provide the manner for attribution of ITC

on common inputs, input services and capital goods

which attract the provisions of Section 17(2) to the

extent they are used in relation to the exempt

supplies for reversal thereof. The extract of the

relevant rules is also produced hereunder:

42. Manner of determination of input tax credit in

respect of inputs or input services and reversal

thereof.-(1) The input tax credit in respect of inputs

or input services, which attract the provisions of

sub-section (1) or sub-section (2) of section 17,

being partly used for the purposes of business and

partly for other purposes, or partly used for

effecting taxable supplies including zero rated

supplies and partly for effecting exempt supplies,

shall be attributed to the purposes of business or for

effecting taxable supplies in the following manner…

43. Manner of determination of input tax credit in

respect of capital goods and reversal thereof in

certain cases.-(1) Subject to the provisions of sub-

section (3) of section 16, the input tax credit in

respect of capital goods, which attract the

provisions of sub-sections (1) and (2) of section 17,

being partly used for the purposes of business and

partly for other purposes, or partly used for

effecting taxable supplies including zero rated

supplies and partly for effecting exempt supplies,

shall be attributed to the purposes of business or for

effecting taxable supplies in the following manner…One may argue that these rules deny the ITC on

goods and services used exclusively in effecting the

exempt supplies as these rules primarily compute

the ITC to be credited to the Electronic Credit Ledger

(C1) by eliminating the ITC on goods and services


12


used exclusively in effecting exempt supplies (T2)

and therefore such credit is ineligible. However, the

authors based on their understanding believe that

computation of C1 i.e. ITC to be credited to the ECL is

done only for ascertaining common ITC attributable

to exempt supplies (D1) and common ITC

attributable to non-business purpose (D2). D1 and

D2 could not have been ascertained without

determining the value of C1. The authority of these rules as already produced

above makes it pretty clear that these rules can only

prescribe the mechanism for computation of

common ITC attributable to exempt supplies or non-

business purpose and their reversal. In other words,

these rules do not have any authority to prescribe

reversal of ITC on inputs, input services and capital

goods attributable to exempt supplies where there

is no common ITC. Even if there is some common ITC

attributable to both taxable as well as exempt

suppliesas well as some ITC attributable exclusively

to the exempt supplies, then also these rules can be

applied for the reversal of only the common ITC and

not for the reversal of the ITC attributable

exclusively for exempt supplies.

For instance, many education institutions apart

from having major receipts from their exempt

services also have some receipts from taxable

services (let's suppose rental income) owing to

which they are required to obtain registration. In

spite of having some common ITC attributable to

both the taxable as well as exempt services, these

institutes have ITC on many goods and services

which are used exclusively in providing exempt

services. In this case, the provisions of Section 17(2)

read with Rule 42 and 43 can be applied only for the

reversal of common ITC and not for the reversal of

ITC attributable exclusively to the exempt supplies.

Without prejudice to anything mentioned above,

even if it's assumed that Rule 42 and 43 impliedly

deny the ITC on goods and services used exclusively

in effecting exempt supplies, the validity of these

rules can be challenged before the courts. In spite of

the fact that these rules have not been empowered

by the statute, they seem to have travelled beyond

the object of the statute. It's a well settled principle

that the delegated legislation cannot override the

principle legislation. Power delegated by thestatute

does not enable the authority by regulations to

extend the scope or general operation of the

enactment but is strictly ancillary. Therefore,

anything which is not intended or missed by the

legislature in the statute cannot be brought into

authority by these rules.

Conclusion

Perusal of the above paragraphs makes it clear that

the enabling provision for restricting ITC on goods

and services exclusively used for exempt supplies

are definitely missing in the GST law. Whether it is

merely a miss or intentionally omitted by the

legislature, whatever be the case, it is a well settled

position of law that strict interpretation of the

statute has to be made. When the words in a statute

are clear, plain and unambiguous only one meaning

can be inferred. In view of the above, it can be said

that there is no infirmity in availing such ITC as there

is no explicit restriction in the law.

Any feedback/suggestions/views of the readers on

this issue can be shared with the authors at

[email protected] , [email protected].


13

CA.Prarthana JalanA presence of just one question mark can delete penalty u/s 271(1)(C ) of the I.T Act,1961.

Arthur Vanderbilt has

said "Taxes are the

l i f e b l o o d o f

government and no

taxpayer should be

permitted to escape the

payment of his just

share of the burden of

contributing thereto.”

Yet people tend to devise ways and means of

escaping payment of taxes and we professionals

educate and convince them to discharge their

respective legitimate tax liability with utmost

sincerity, honesty and timely because the failure to

do so would not only attract tax liability and interest

in future but also PENALTY and God forbids

Prosecution can also take place.

Well, we all tax practitioners can relate to one

dialogue- “Addition se Darr nahi lagta sahab,

penalty se lagta hai”. Whenever penalty u/s

271(1)(C ) of the I.T Act,1961 is imposed, we start

searching for answers in form of various case laws,

provisions of law to get it deleted. But, I would say

instead of looking for answers ,we should search for

just one simple question in the penalty notice or

penalty order , which if we are able to find, than the

penalty levied u/s 271(1)(C ) will automatically be

deleted.

Though my aforesaid words of searching for

question rather than answer might sound absurd

but my words are duly supported by the judgments

of the Hon'ble Supreme Court, Hon'ble High

court(s) and Honble ITAT(s)(Temple of

knowledge) judicial pronouncements.

We all know that Penalty u/s section of 271(1)( C) is

imposed for furnishing of inaccurate particulars of

income or concealment of income , which now has

been replaced by sec 270A of the Income Tax

Act,1961 wherein now penalty will be imposed for

under-reporting of income/misreporting of income.

Thus, Penalty u/s 271(1)(c ) has two limbs-

concealment of income or of furnishing inaccurate

particulars of income. Therefore, penalty can be

levied u/s 271(1 )(C ) of the Act, only when there is

either concealment of income or of furnishing of

inaccurate particulars of income. In the absence of

clear cut specification in the notice issued u/s 274 of

the Act or in the order passed for levying of penalty

u/s 271(1)(c ) that is it for concealment of income or

of furnishing of inaccurate particulars of income the

notice as well as order is bad in law and penalty

imposed in it is liable to be delated.

Concealment of income and furnishing inaccurate

particulars of income carry different connotations.

According to In Webster's Dictionary,

"inaccurate" has been defined as:

"not accurate, not exact or correct; not according

to truth; erroneous; as an inaccurate statement,

copy or transcript."

According to Law Lexicon, the word "conceal"

means:

"to hide or keep secret. The word "conceal" is con

plus celare which implies to hide. It means to

hide or withdraw from observation; to cover or

keep from sight; to prevent the discovery of; to

withhold knowledge of. “


14

It is a basic requirement of law that before a penalty

is imposed, the assessee must be apprised of the

precise charge brought against him. Law requires

that assessee must be told distinctly whether he is

held guilty of having 'concealed the particulars of

his income' or of having 'furnished inaccurate

particulars of Income'.Section 274(1) provides for

a reasonable opportunity to be given to the

assessee so that he can meet the charge against

him. This is to ensure that the assessee gets an

adequate opportunity in respect of the default,

which is found and alleged against him and which

forms the basis of the issuance of the Notice under

section 271(1)(c) and to ensure that the assessee is

not put to peril of answering against something,

which never was specifically determined as his

default or in respect of which, no notice was issued

by the AO. It is the satisfaction of the AO which

alone matters at the time of initiation of penalty

proceedings on the basis of which penalty can be

levied and sustained.

The practice of the Department sending a printed

form where all the ground mentioned in Section

271 are mentioned would not satisfy requirement

of law when the consequences of the assessee not

rebutting the initial presumption is serious in

nature and he had to pay penalty from 100% to

300% of the tax liability. As the said provisions have

to be held to be strictly construed, notice issued

under Section 274 should satisfy the grounds

which he has to meet specifically. Otherwise,

principles of natural justice is offended if the show

cause notice is vague. On the basis of such

proceedings, no penalty could be imposed on the

assessee.

herefore, the Assessing Officer should be clear as to

which of the two limbs under which penalty is

imposable, has been contravened or he should

indicate that both have been contravened while

initiating penalty proceedings. It cannot be that the

initiation would be only on one limb i.e. for

furnishing inaccurate particulars of income while

imposition of penalty on the other limb i.e.

concealment of income. A clear cut demarcation of

which of the two limbs or are both the limbs been

contravened for which penalty is initiated and is

imposed should be clearly mentioned in the notice

as well as in the order imposing penalty.

The aforesaid preposition of law has been dealt

by the Hon'ble Supreme Court in the case of CIT

V/s M/S SSA'S EMERALD MEADOWS on

5/8/2016 wherein the Hon'ble SC has

dismissed the SLP and has confirmed the

Hon'ble Karnataka High Court Judgement

wherein it was held that omission of assessing

officer to explicitly mention that penalty

proceedings are being initiated for furnishing

of inaccurate particulars or that for

concealment of income makes the penalty

order liable for cancellation even when it has

been proved beyond reasonable doubt that the

assessee had concealed income in the facts and

circumstances of the case despite the

amendment of S ection 271(1B) with

retrospective effect.

The Hon'ble Bombay High court in the case of

CIT v/s Shri Samson Perinchery vide order

dated 5th January,2017 has also upheld the

decision of the Hon'ble Tribunal wherein

A presence of just one question mark can delete penalty u/s 271(1)(C ) of the I.T Act,1961.


15


penalty levied u/s 271(1)(c ) was deleted

because it was observed by the Hon'ble courts

that the initiation of penalty under Section 271

(1)(c) of the Act by Assessing Officer was for

furnishing inaccurate particulars of income

while the order imposing penalty was for

concealment of income. It was also observed by

the Hon'ble court that notice was issued under

Section 274 of the Act is in a standard proforma,

without having striked out irrelevant clauses

therein. This indicates non-application of mind on

the part of the Assessing Officer while issuing the

penalty notice.

The Assessing Officer is empowered under the Act

to initiate penalty proceedings once he is satisfied

in the course of any proceedings that there is

concealment of income or furnishing of inaccurate

particulars of total income under clause (c).

Concealment, furnishing inaccurate particulars of

income are different. Thus the Assessing Officer

while issuing notice has to come to the conclusion

that whether is it a case of concealment of income

or is it a case of furnishing of inaccurate particulars.

The Apex Court in the case of T. Ashok Pai v. CIT

[2007] 292 ITR 11/161 Taxman 340 has held

that concealment of income and furnishing

inaccurate particulars of income carry

different connotations. The Gujarat High Court

in the case of CIT v. Manu Engg. [1980] 122 ITR

306 and the Delhi High Court in the case of CIT v.

Virgo Marketing (P) Ltd [2008] 171 Taxman

156, has held that levy of penalty has to be clear as

to the limb for which it is levied and the position

being unclear penalty is not sustainable. Therefore,

when the Assessing Officer proposes to invoke the

first limb being concealment, then the notice has to

be appropriately marked. Similar is the case for

furnishing inaccurate particulars of income. The

standard proforma without striking of the relevant

clauses will lead to an inference as to non

application of mind.

Amritsar Bench, Third member in the case of

HPCL MITTAL ENERGY LTD V/S add cit (ITA no

554 & 555/ASSR/2014) has also held the

aforesaid law.

Hon'ble ITAT Agra Bench, Agra in Jaipal Singh

v/s ITO in ITA No 91/Agra/2017 in bunch of

cases has deleted penalty because penalty was

initiated on one limb and was imposed on other

limb.

Hon'ble Kolkata ITAT In the case of Uma

Shankar Agarwal Vs DCIT in ITA Nos.1831 to

1835/Kol/2009 wherein assessee therein

challenged the legality of Penalty Order on the

ground of “No satisfaction” and “Show cause Notice

without specific charge”, the Bench vide Order

dated 20.01.2016 held penalty unsustainable in

law for the reasons as elaborately discussed in

Para-9 to 10 of the said Order.

Hon'ble ITAT , Kolkata Bench in the case of

Suvaprasanna Bhatacharya Vs ACIT in ITA

No.1303/Kol /2010 vide Order dated 06-11-

2015 deleted penalty levied under section

271(1)(c) on the ground of “No Satisfaction”

recorded in the assessment order and Notice being

issued on both the charges without specifying the

exact charge.


16


Pune Bench of the Hon'ble ITAT, in the case of

S .L. K. Properties Vs ITO in ITA No.

140/PN/2014 wherein vide Order dated

18.03.2016 has also upheld the same view

Hon'ble ITAT, Mumabi Bench in the cases of

ACIT Vs Deepesh M. Panjwani in ITA No.

6330/Mum/2012 & 5878/Mum/2012 while

examining the validity of Penalty order in the light

of objection raised by the assessee regarding the

validity of Penalty Notice issued on the basis of

both the charges vide Order dated 18.03.2016

placing reliance to the Judgments in the cases of

Manjunath Cotton & Ginning Factory held penalty

to be unsustainable in law.

The illegality in the Notice cannot be saved by

recourse to section 292BB of the Act, as was held by

the ITAT, Mumbai Bench in the case of 'Dr. Sarita

M i l i n d D a v a r e Vs A C I T ' i n I TA N o .

2187/Mum/2014 wherein in Para-7 of the order

this plea was taken by the revenue before the ITAT

to counter the ratio of Manjunatha referring to the

order passed by the Bangalore Bench in the case of

Shri K. Prakash Shetty wherein it was held that

section 292BB would not come to the rescue of the

revenue when the Notice was not in substance and

in conformity with or according to the intent of the

Act. Therefore, it cannot be said that section 292BB

can validly be pressed into service in respect of

such a jurisdictional mistake.

Thus, the aforesaid judgements especially when

they are being followed by Honble ITAT'S which

are considered as temple of knowledge have

clearly laid down the law that in case the notice

issued u/s 274 for imposing penalty u/s 271(1)( c)

or the order passed wherein penalty u/s 271(1)(C )

is imposed has ambiquity in it regarding whether it

is for concealment of income or for furnishing of in

accurate particulars of income, the same is liable to

be delated.

So next time whenever dealing with penalty u/s

271(1)( c) do try to first search for a question mark

in the notice as well as in the order. If there arises a

simple question that is it For Concealment of

Income or of Furnishing of inaccurate particulars

of Income? The question itself will provide you the

solution for getting the penalty deleted.


17

Celebrating the Past & Inspiring the Future

CA. Arjit [email protected]

1.In Brief

As we all know Chartered

Accountants Day is a matter

of prestige and proud for

every CA. This year is

s p e c i a l t o u s a s b e

completed seven decades of

professional journey . As

our ICAI theme for CA Day celebration is

“Celebrating the Past & Inspiring the future” , I tried

to compile events of past in ICAI as “Celebrating the

Past” and “Inspiring the Future” section which

includes majority of our members from CA

Faternity who has done a tremendous job in their

professional lives and achieved as a milestone in

the country and aboard. The intention behind this

to recall our old glorious memories for ICAI and to

spread awareness & motivation among CA

Aspirants to join this course and be part of partner

in Nation Building.

Being a Chartered Accountant, I always feel proud

to be part of very small professional family in India

who is working day night for the development of

economy and do all roles as partner in Nation

Building. As understand to me, we have very small

one family of around 3 Lakhs Chartered

Accountants in Country - India who are working in

various financial fields and others for approx 135

crores of Indian and overseas also.

Celebrating the Past

1.Inauguration of ICAI Head office

The then Finance Minister Mr. C.D. Deshmukh laying foundation stone of the ICAI Headquarters

ICAI Building in 1954

Dr. Rajendra Prasad delivering the Speech the during opening of the ICAI Headquarters


18


Piyush Goyal Ji is a Chartered Accountant from

Institute of Chartered Accountants of India (ICAI) .

He has had a strong academic record - all-India

second rank holder Chartered Accountant and

second rank holder in Law in Mumbai University.

He has participated in Leadership Programs at Yale

University (2011), Oxford University (2012) and

Princeton University (2013). He did his schooling

from Don Bosco High School, Matunga.,he also

holds a degree from Harvard University

An Indian politician and the current minister of

Railways and Commerce in the Government of

India.

November 2019 www.circ-icai.orgCIRC Newsletter 02

Article:Celebrating the Past & Inspiring the Future

He was elevated to Cabinet

Minister position on 3

September 2017. He is

currently a Member of

Parliament for Rajya Sabha

f r o m t h e s t a t e o f

Maharashtra and was

e a r l i e r t h e N a t i o n a l

Treasurer of the Bharatiya

Janata Party (BJP). He headed the BJP's

Information Communication Campaign Committee

and oversaw the publicity and advertising

campaign of the party including the social media

outreach for the Indian General Elections 2014.

Goyal is the 2018 Carnot Prize Recipient for

distinguished contributions to energy policy.

Piyush Goyal has been allocated the cabinet

ministry for Narendra Modi led NDA government in

May 2019. He is currently taking charge as Minister

of Railways and Minister of

Commerce and Industry

K Rahman Khan Ji is a

Chartered Accountant from

Institute of Chartered

Accountants of India (ICAI)

. He is a Veteran Politician

b e l o n g i n g t o I n d i a n

National Congress and a

former Union Minister of Minority Affairs and also

Ex-Deputy Chairman of Rajya Sabha.

Having graduated in commerce, and a D. Lit., Shri

Rahman Khan established his credential as

accountancy professional before his zeal for

serving people at large propelled him to join

politics. He was elected as a member of Karnataka

Opening of the ICAI Headquarters by the then President of India Dr. Rajendra Prasad


19


Legislative Council in 1978 and rose to become its

chairman in 1982-84 and Chairman Karnataka

State Minorities Commission (Cabinet rank) in

1993-94. His recommendations after a door to

door survey of Socio-Economic status of Minorities

during his tenure as Chairman, Karnataka

Minorities Commission has resulted in 4%

reservation for minorities in the State Government

services and educational institutions

Suresh Prabhu Ji is a




. He is an Indian politician

and India's Sherpa to the

G20. He was formerly the

Minister of Commerce &

Industry and Civil Aviation in the First Modi

ministry.

He has completed his school from Sharadashram

Vidya Mandir, Dadar, Mumbai, followed by a

Bachelor in Commerce with Honours from M. L.

Dahanukar College, Vile Parle, Mumbai. He

received a Bachelor in Law degree from the New

Law College (Ruparel College campus), Mumbai.

Prabhu is a Chartered Accountant and a member of

the Institute of Chartered Accountants of India. He

was All India 11th (eleventh) rank holder in CA

exam.

Since 1996, Prabhu has been a repeatedly elected

Member of Parliament from Rajapur Lok Sabha

constituency in Maharashtra as a member of the

Shiv Sena (SS) political party. He quit Shiv Sena and

joined BJP on 9 November 2014. He currently

represents Andhra Pradesh in the Rajya Sabha.

Kirit Somaiya Ji is a

Chartered Accountant . is

an Indian politician of the

Bharatiya Janata Party

( B J P ) wh o c u r re n t ly

r e p r e s e n t s M u m b a i

North-East in the 16th Lok

S a b h a . H e a l s o

represented the same seat

in the 13th Lok Sabha

In 1999 Lok Sabha election, Somaiya defeated the

incumbent Gurudas Kamat of the Indian National

Congress by a margin of 7,276 votes. As a

parliamentarian, he submitted the maximum

number of petitions to the parliament, i.e. 11 (out of

27 total petitions presented in 13th Lok Sabha)

during his tenure in Lok Sabha which was the

highest number of petitions submitted by any MP

in the history of Indian Parliament. He was an

extremely active member of the house where

during his tenure he raised a total of 832 questions

in the house on several issues

Kumar Mangalam Birla

J i i s a C h a r t e r e d

Accountant from Institute

of Chartered Accountants

of India (ICAI) and an

I n d i a n b i l l i o n a i r e

industrialist, and the

chairman of the Aditya

Birla Group, one of the

largest conglomerates in India.

He has received several awards, including the


20


International Advertising Association's "CEO of the

Year Award" in 2016; the US India Business

Council's "Global Leadership Award" in 2014;

Economic Times “Business Leader Award” in 2003

and 2013; Forbes India Leadership Award –

Flagship Award “Entrepreneur of the Year 2012;

NDTV Profit Business Leadership Awards 2012,

“Most Inspiring Leader”; CNBCTV18 IBLA

“Business Leader for Taking India Abroad 2012”;

CNN-IBN “Indian of the Year Award 2010”; JRD Tata

“Leadership Award 2008”; NDTV's “Global Indian

Leader of the Year 2007

He is also the chancellor of the Birla Institute of

Technology & Science, and the chairman of the

Indian Institute of Technology Delhi and Indian

Institute of Management Ahmedabad.

Motilal Oswal Ji is a



Accountants of India (ICAI) .

He is the Chairman and

M a n a g i n g D i re c to r o f

Motilal Oswal Financial

Services Ltd (MOFSL) which

he co-founded with Ramdeo

Agrawal in 1987.Oswal was awarded the "Rashtriya Samman Patra"

by the Government of India for being amongst the

highest Income Tax payers in the country for a

period of 5 years from FY95–FY99.

The Institute of Chartered Accountants of India

gave Oswal with the "Excellent Business Achiever

in Financial Services" award. The "Udyog Rattan

Award" was also conferred to him for his

performance in the industrial development of the

country by the Institute of Economic Studies, New

Delhi. He has also been awarded an entry in "The

Hall of Fame for Excellence in Franchising" by -

Franchising World Magazine. He was also named as

the Champion of Arthshastra by a Rotary District

and the "Excellent Business Achiever in Financial

Services" Award by the Institute of Chartered

Accountants of India. Oswal was given the "Special

Contribution to Indian Capital Market" award in

'India's Best Market Analyst Awards 2009

organized by Zee Business

T. V. Mohandas Pai Ji is a




. He is the Chairman of

Manipal Global Education

(Manipal University). He

was a former director of

Infosys,and Head – Administration, Education and

Research, Financial, Human Resources of Infosys

Leadership Institute.

Mohandas has a keen interest in improving literacy

across the country, mainly primary education.

In 2000, he, along with others, founded the

Akshaya Patra Foundation, Bangalore, to start a

midday meal program for school children. Today,

the midday meal program feeds over 1,200,000

children in 7,669 government schools across seven

states in India, primarily in Bangalore's rural and

urban areas, Mysore, Mangalore, Hubli, Mathura,

Jaipur, Baran district of Rajasthan, Nayagarh

district of Orissa, Puri, Bhilai, Guwahati, Ahmedabad

[6]

https://en.wikipedia.org/wiki/T._V._Mohandas_Pai


21


and Vadodara. This program aims to feed

5,000,000 children by 2020. This initiative has

turned out to be the largest midday meal program

in the world. He has made substantial personal

contributions to this program

Naina Lal Kidwai Ji is a




& is an Indian banker, and

business executive. She was

formerly a Group General

Manager and the Country

Head of HSBC India. She is also a former President

of the Federation of Indian Chambers of Commerce

and Industry (FICCI).

Currently she is Chairman of Max Financial

Services Ltd. Along with serving as the Chairman of

HSBC Asset Management (India) Pvt Ltd and HSBC

InvestDirect (India) Ltd, her other positions

include being a non-executive director on the

board of Nestle SA and Altico Capital Partners,

Chairwoman, City of London's Advisory Council for

India, Global Advisor, Harvard Business School. She

is on the Governing Board of NCAER, Audit

Advisory Board of the Comptroller and Auditor

General of India, and on the National Executive

Committee of CII and FICCI. She is independent

director of Narara Energy

Rakesh Kumar Radheyshyam Jhunjhunwala Ji is

a Chartered Accountant from Institute of Chartered

Accountants of India (ICAI) . He is an Indian

Billionaire Investor and Trader. He is a Chartered

Accountant. He manages

his own portfolio as a

p a r t n e r i n h i s a s s e t

management firm, Rare

Enterprises. Jhunjhunwala

has been described by India

Today magazine as the "pin-

up boy of the current bull

run and by The Economic Times as "Pied Piper of

Indian bourses".

As per Forbes, he is the 54th richest person in India,

with net worth of USD 3 billion (as of 1 June 2018)He is the chairman of Aptech Limited and Hungama

Digital Media Entertainment Pvt. Ltd. and sits on

the board of directors of various Indian companies

such as Prime Focus Limited, Geojit Financial

Services, Bilcare Limited, Praj Industries Limited,

Provogue India Limited, Concord Biotech Limited,

Innovasynth Technologies (I) Limited, Mid Day

Multimedia Limited, Nagarjuna Construction

Company Limited, Viceroy Hotels Limited and Tops

Security Limited. He is popularly referred to as the

"Warren Buffett of India" and the "King of Bull

Market”

S w a m i n a t h a n

Gurumurthy Ji is a




. He is currently serving as a

part-time director of RBI.

He is also a journalist

editing the Tamil political weekly Thuglaq and a

Chartered Accountant. He is the co-convenor of the


22


Swadeshi Jagaran Manch

Shekhar Kapur Ji is a



Accountants of India (ICAI) .

He is an Indian film director,

actor, and producer, known

for his works in Hindi

cinema and international

cinema. Part of the Anand

family, Kapur became known in Bollywood with his

recurring role in the TV series Khandan in the mid-

1980s and his directorial debut in the cult

Bollywood film Masoom in 1983, which won the

Filmfare Critics Award for Best Movie for that year,[

before gaining widespread success with the

science fiction film Mr. India (1987).

He gained international recognition with the 1994

Bollywood film Bandit Queen, based on Mala Sen's

biography of infamous Indian bandit and politician

Phoolan Devi, which won the National Film Award

for Best Feature Film in Hindi and Filmfare Critics

Awards for Best Movie and Best Direction for that

year. It was premiered in the Directors Fortnight

section of the 1994 Cannes Film Festival and was

screened at the Edinburgh Film Festival

H a r i s h S a lve J i i s a

Chartered Accountant . He

is an Indian lawyer, who

s p e c i a l i z e s i n

constitutional, commercial

and taxat ion law. He

primarily practices at the

Supreme Court of India but also appears in various

High Courts and in international arbitration,

sometimes as counsel and other times as an

adjudicator. He served as the Solicitor General of

India from 1 November 1999 to 3 November 2002.

India Today magazine ranked him 43rd in India's

50 Most powerful people of 2017 list

Before he became a lawyer, Salve was qualified as a

chartered accountant and practised chartered

accountancy in taxation. He was inspired by Nani

Palkhivala, a tax lawyer from Mumbai. He began his

legal career in 1980 at J. B. Dadachandji & Co., first

as an intern, and later as a full-time lawyer. During

this time, he assisted Palkhivala in the Minerva

Mills case (case citation: AIR 1980 SC 1789). Salve

was later designated a Senior Counsel by the Delhi

High Court.Salve worked with former Attorney General, Soli

Sorabjee, from 1980–1986. He declined to be

nominated for a second three-year term due to

"personal reasons" when his first term ended in

November 2002. He later clarified that his wife was

unhappy with him bringing work home.

Salve was appointed as Amicus Curiae by the

Supreme Court in some cases, mostly relating to

preservation of the environment. However, in

2011, he recused himself from this position during

a hearing on illegal mining, on the grounds that he

had previously appeared for one or more of the

parties.

In 2013, Salve was admitted to the English Bar and

subsequently joined the Blackstone Chambers


23

IMPORTANT ANNOUNCEMENT’S


24

Objective

The objective for which the fund is established is to provide financial assistance for maintenance, education or any other similar purpose to necessitous persons being:-

(a) persons who are or have been members of the Institute, whether subscribers to the fund or not; or (b) wives and children of persons who are or have been members of the Institute, whether subscribers to the fund or not. (c) widows and children of deceased persons who have been members of the Institute whether subscribers to the fund or not. (d) relatives or others who were dependent for support on a person who has been a member of the Institute, whether subscriber to the fund or not; and who has died without leaving a widow or child.

Procedure for becoming a member of the CABF :

There are two categories of members :-

(a) Life Member: A single payment of Rs. 5000/- shall make a person eligible to be admitted as a life member of the fund. Thereafter he shall not be liable to pay any amount on account of subscription and shall be styled as a 'Life Member'.

(b) Ordinary members: All other members shall be described as 'Ordinary Members' and shall have to pay an annual subscription of Rs. 1000/-.

Apart from this any member can subscribe for 'Voluntary Contribution'. Procedure for making payment

Membership subscription to the Chartered Accountants Benevolent Fund can be paid along with annual membership fee. Alternatively it can be paid separately by local cheque/DD to the respective Decentralised offices or Regional offices or Head office.

Monthly Assistance

Maximum monthly assistance available to a member or persons eligible to receive the assistance is from Rs.4500/- to Rs.7500/- per month according to the circumstances of the use renewable after one year. This is for maintenance of family of members/widow/relatives of deceased members.

Financial assistance will be given only to the members/widows/relatives whose monthly family income is not more than Rs. 15000/- pm.

Ex-gratia financial assistance of Rs.150000/- is provided to the legal heir of deceased member in case of accidental death/ unnatural death at the age below 55 years against claim.

Procedure for availing assistance

Application for financial assistance should be made in prescribed format along with all relevant supporting documents mentioned therein. The application must be recommended by any Central Council Member or Chairman/Vice Chairman/Secretary of any Regional Council or Branch/ Ex-President/Chairman/Vice-Chairman and Member Secretary/Member of Managing Committee of CABF /Member of Managing Committee of Regional Council

CA Benevolent Fund

ANNOUNCEMENTS


25

ANNOUNCEMENTS

“Information combined with Knowledge isPower”, so goes an old saying, which remainsrelevant to Indian accountancy profession of thepresent times. And the knowledge multiplies anddisseminates by sharing. It is in the spirit that TheCIRC Monthly e-Newsletter is published everymonth.

To add a new sphere to this Newsletter reach,coverage and utility, it has been decided to put anew focus on profession-oriented knowledge,where a large number of members are giving theirservice in various capacities, including as CFOsand CEOs. As such, the CIRC members in industry,

who have a knack for writing, are invited tocontribute in this e-Newsletter the articles specificto their Industry in Professional perspective.Such article, of not more than 2500 words (originaland not having been published or hosted anywhereelse) with executive summary and authorsp h o t o g r a p h s , s h o u l d b e s e n t a t T h eauthors are also required to give a declaration oforiginality and a brief profile along with the articles.

Thanks & RegardsTEAM CIRC

Invitation to Members to Contribute in Monthly E-Newsletter of CIRC of ICAI

MCA has introduced LLP Settlement Scheme, 2020 to give a Onetime relaxation in additional fees to the defaulting LLPs

ANNOUNCEMENT

The Ministry of Corporate Affairs has provided a one time opportunity to the LLPs to make good their default by filing pending documents and to serve as a compliant LLP in future by introducing LLP Settlement Scheme, 2020 vide General Circular No 02/2020 dated 4th March, 2020 which will be applicable from 16th March, 2020 to 13th June, 2020.

ICAI is happy that this 90 days period would be of immense help for the members and the LLPs in filing their belated documents.

Also, the defaulting LLPs, which have filed their pending documents till 13th June 2020 and made good the default, shall not be subjected to prosecution by Registrar for such defaults.

In this regard, the Ministry of Corporate Affairs, Government of India, has issued a Circular on their website and the link for the same is as below: http://www.mca.gov.in/Ministry/pdf/GeneralCircular06_04032020.pdf

ICAI has also prepared and issued FAQs on the LLP Settlement Scheme, 2020 for the benefit of its members and other stakeholder that are uploaded on ICAI website.

Members concerned are earnestly requested to kindly plan their filing accordingly.

With Kind Regards,

Chairman Vice-ChairmanCorporate Laws & Corporate Governance Committee Corporate Laws & Corporate Governance Committee


26

ANNOUNCEMENTS

As an ongoing attempt to facilitate the members practising in the field of International Taxation, the Committee on International Taxation of ICAI has entered into an arrangement with Capital Market

Capitaline TP is online corporate database on more than 35000+ companies with their Financials or non-financial information updated every day. With this, the Committee on International Taxation has tried to

Publishers India Pvt. Ltd. on 21.12.2019 for 3 years to grant licenses of Capitaline corporate database to the practicing Chartered Accountants and CA firms at a special discounted offer as per below options:

make available the relevant resources at a subsidized cost to the members, which in turn would enable them to discharge their functions in an effective manner.

ICAI enters into an arrangement for TP corporate database at a concessional rate

Name of the product

CAPITALINE Plus (Online)

CAPITALINE TP (Online)

CAPITALINE TP (Desktop)

* Taxes extra

The features of each of the above options can be viewed by browing on the link below:

To subscribe:

Special Discounted Price

Online version annual subscription charges (Per Login) Rs. 30,000/-*

Online annual subscription charges (Per Login) Rs. 15,000/-*

Desktop version annual subscription charges Rs. 65000/-*

https://resource.cdn.icai.org/58637citax060320.pdf

https://www.capitaline.com/ICAI/register1.asp


27

ANNOUNCEMENTS

Q. 1. What is LLP Settlement Scheme, 2020?

A. 1. “LLP Settlement Scheme, 2020″ is a scheme to give a Onetime relaxation in additional fees to the defaulting LLPs to make good their default by filing pending documents viz. Form Nos 3, 4, 8 and 11 and to serve as a compliant LLP in future. Refer GeneralCircular No 2/2020 available at the link –

http://www.mca.gov.in/Ministry/pdf/GeneralCircular06_04032020.pdf

Q. 2. What is the objective of this Scheme?

A. 2. The Ministry of Corporate Affairs, as part of Government's constant efforts to promote ease of doing business, has decided to introduce a scheme namely "LLP Settlement Scheme, 2020", by allowing a One-time condonation of delay in filing statutorily required documents with the Registrar

Q. 3. Whether this Scheme is permanent?

A. 3. No. It is one time relaxation, as part of Government's constant efforts to promote ease of doing business it has been decided to give a Onetime relaxation in additional fees to the defaulting LLPs to make good their default by filing certain pending documents and to serve as a compliant LLP in future.

Q. 4. What is the time period of the Scheme?

A. 4. The Scheme shall come into force on the 16th March, 2020 and shall remain effective up to 13th June, 2020 (both days inclusive).

Q. 5. What is defaulting LLP as per the Scheme? A. 5. "Defaulting LLP" means a LLP registered under the Limited Liability Partnership Act, 2008 which has made a default in filing of documents on the due date(s) specified under the LLP Act, 2008 and rules made there under.

Q. 6. Whether an LLP is required to file an

application to the Registrar to avail the Scheme?

A. 6. No, the defaulting LLPs may themselves avail of the scheme for filing documents which have not been filed or registered in time on payment of additional fee and statutory fee.

Q. 7. What shall be the manner of payment of fees and additional fee on filing belated document for seeking immunity under the Scheme?

A. 7. Under the scheme, for the belated documents, the LLP shall pay

® Statutory filing fees as prescribed under the LLP Act and rules made there under along with

® an additional fee of Rs 10 per day, provided that such payment of additional fee shall not exceed Rs. 5,000/- per document.

Q. 8. Whether additional fee of Rs. 10 per day is for all forms in aggregate orindividually?

A. 8. Additional fee of Rs 10 per day is payable per document and not in aggregate. Thus, if there is there is delay of 300 days for one form and 330 days for another form, then for the form where delay is 300 days, additional fee will be Rs. 3,000 and for another form where delay is for 330 days, additional fee will be Rs. 3,300.

Q. 9. Whether cap of Rs. 5,000/- on additional fee is for all forms in aggregate or individually? A. 9. Cap on additional fee of Rs 5,000 is applicable per document and not in aggregate. Thus, if there is there is delay of 900 days, then additional fee for the form at the rate of Rs. 10 per day works out to Rs. 9,000 which is more than Rs. 5,000 and therefore additional fee will be Rs. 5,000 for the form.

Q. 10. On which filing the Scheme shall be applicable?

A. 10. Scheme shall be applicable inly on filing of

Frequently Asked Questions on LLP Settlement Scheme, 2020 issued by the Ministryof Corporate Affairs, Government of India

Corporate Laws & Corporate Governance Committee of ICAI


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ANNOUNCEMENTS

following documents:

i. Form-3- Information with regard to limited liability partnership agreement and changes, if any, made therein;

ii. Form-4- Notice of appointment, cessation, change in name/ address/ designation of a designated partner or partner and consent to become a partner/ designated partner;

iii. Form-S; Statement of Account & Solvency (Annual or Interim);

iv. Form-11- Annual Return of Limited Liability Partnership (LLP).

Q. 11. The Scheme shall be applicable for delay in submission of any form applicable to LLP?

A. 11. No. The Scheme is not applicable to any form other than Form No. 3, Form No. 4, Form No. 8 and Form No. 11.

Q. 12. For which LLPs this Scheme is not applicable?

A. 12. This Scheme shall not apply to LLPs which have made an application in Form 24 to the Registrar, for striking off its name from the register as

per provisions of Rule 37(1) of the LLP Rules, 2009.

Q. 13. Documents for which period in the past, a defaulting LLP is permitted to file?

A. 13. "defaulting LLP" is permitted to file belated documents, which were due for filing till 31st October, 2019 in accordance with the provisions of this Scheme.

Q. 14. Is there any immunity from prosecution in respect of document(s) filed under the scheme?

A. 14. Yes, the defaulting LLPs, which have filed their pending documents till 13th June 2020 and made good the default, shall not be subjected to prosecution by Registrar for such defaults.

Q. 15. What action Registrar can take on the defaulting LLPs which have not availed this Scheme after conclusion of the same?

A. 15. On the conclusion of the Scheme, the Registrar shall take necessary action under the LLP Act, 2008 against the LLPs which have not availed this Scheme and are in default in filing of documents as required under the provisions of LLP Act, 2008 in a timely manner. The defaulting LLPs may be subjected to prosecution by Registrar for suchdefaults.

Frequently Asked Questions on LLP Settlement Scheme, 2020 issued by the Ministryof Corporate Affairs, Government of India

Corporate Laws & Corporate Governance Committee of ICAI


29

ANNOUNCEMENTS

This Standard on Internal Audit (SIA) 140, “Governance,” issued by the Council of the Institute of Chartered Accountants of India (ICAI) should be read in conjunction with the “Preface to the Standards on Internal Audit”, “Framework Governing Internal Audits” and “Basic Principles of Internal Audit” issued by the Institute.

1 Introduction

1.1 Governance is a key concept in Internal Audit and this Standard seeks to clarify both, the concept and the responsibility of the Internal Auditor, Management, and other Stakeholders, with respect to governance, keeping in mind their legal, regulatory, and professional obligations.

1.2 Definition of Internal Audit in the “Framework Governing Internal Audits” (refer Para 3.1), indicatesproviding independent assurance on the effectiveness of internal controls and risk management processes to enhance governance and achieve organisational objectives as a key expectation from internal audit. This definition on internal audit elaborates on the term “Governance” by clarifying how this is a critical element of the company and its various stakeholders.

1.3 Scope: This Standard applies to all internal audits conducted where governance activities andframework is a subject matter of an audit, and is being assessed, evaluated and reported on by theInternal Auditor.

2 Objectives

2.1 The purpose of this Standard is to:

(a) Provide a common terminology by defining governance terms to prevent ambiguity or confusion on the subject matter;

(b) Explain the responsibilities of the Board of Directors and management with regard to governance, as mandated by law and regulations; and

(c) Specify responsibilities of the Internal Auditor, especially when providing independent assurance on the governance framework.

2.2 The overall objective of this Standard is to clarify the responsibilities of management and auditors towards various governance stakeholders (both internal and external), and the requirements which need to be met to assess, evaluate, report and provide independent assurance over the governance framework.

3 Definition

3.1 Governance is defined as a set of relationships between the company and its various stakeholders (both internal and external), and provides the structure through which the company’s objectives are achieved. The relationship and structure help to guide the behaviour of individuals and groups in the right direction. The following are well accepted underpinnings of good governance:

Ÿ Integrity and Accountability.ŸTrust and Equity.Ÿ Transparency and Justice.

3.2 Governance ensures that everyone is aligned to the best interest of the organisation, and does what they are supposed to do, to help achieve its objectives. Governance framework refers to the whole structure, systems and processes put in place to organise the various governance activities and to integrate them seamlessly into the organisation.

3.3 Governance activities, forming part of the framework, are designed to enhance the

The Internal Audit Standards Board of the Institute of Chartered Accountants of India (ICAI) invites comments onStandard on Internal Audit (SIA) 140, Governance.Comments are most helpful if they indicate a clear rationale and, where applicable, provide a suggestion foralternative wording.Comments can be e-mailed either at [email protected] or [email protected] date for sending comments is March 29, 2020.

EXPOSURE DRAFT STANDARD ON INTERNAL AUDIT (SIA) 140 GOVERNANCE


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organisation’s ability to, amongst others:

(a) Provide strategy, leadership and direction;(b) Nurture a culture of values and ethics;(c) Sensitive to multiple stakeholder interests;(d) Promote collaborative decision making;(e) Provide structure and design to organisation resources and their deployment;(f) Prevent undue concentration of power with few;(g) Encourage risk-based prioritisation, consistency and efficiency in business processing;(h) Support resource development in the area of good governance;(i) Exercise judicious monitoring and oversight on business and individual performance; and(j) Ensure full and transparent communication and reporting.

All these initiatives generally form part of the Entity Level Controls (ELCs) which are essential to the overall internal audit agenda.

4 Responsibility of the Board and Management

4.1 The responsibility of the Board of Directors in the area of governance is generally established by the prevailing laws of the nation and that of the management, by both the prevailing laws and the oversight of the Board of Directors. These responsibilities, such as those prevailing in India, are presented below.

4.2 Companies Act, 2013 imposes overall responsibility on the Board of Directors with regard to governance and specifically towards the Company’s stakeholders. Section 166, Duties of Directors states,

(2) A director of a company shall act in good faith in order to promote the objects of the company for the benefit of its members as a whole, and in the best interests of the company, its employees, the shareholders, the community and for the protection of environment.

4.3 More specifically, Schedule IV of Companies Act, 2013 on “Code for Independent Directors”, Section I, Guidelines of Professional Conduct, requires them to,

(9) assist the company in implementing the best corporate governance practices.

4.4 For listed companies, as per The Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (“LODR”), the Board of Directors of the Company have additional responsibilities on governance. Chapter II, Regulation 4(2)(f) of LODR mandates the responsibilities of the Board of Directors, as:(ii) Key functions of the board of directors -(2) Monitoring the effectiveness of the listed entity’s governance practices and making changes asneeded.

In addition, under the same regulation, it states,

(iii) Other responsibilities -

(2) The board of directors shall set a corporate culture and the values by which executives throughout a group shall behave.

4.5 For listed companies, the LODR has an exhaustive list, as per Schedule II: Corporate Governance, which stipulates various requirements and good governance practices in this area. Without enumerating them here, it is pertinent to note a few provisions, which are most relevant to internal audit:

(a) Part C. Section A. The role of the audit committee shall include the following:

(12) reviewing, with the management, performance of statutory and internal auditors, adequacy of the internal control systems;

(13) reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department, staffing and seniority of the official heading the department, reporting structure coverage and frequency of internal audit;

(14) discussion with internal auditors of any significant findings and follow up there on;

(15) reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or irregularity or a


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failure of internal control systems of a material nature and reporting the matter to the board;

(b) Part C. Section B. The audit committee shall mandatorily review the following information:

(4) internal audit reports relating to internal control weaknesses; and

(5) the appointment, removal and terms of remuneration of the chief internal auditor shall be subject to review by the audit committee.

4.5 Hence, governance is seen as an essential element of business functioning, and internal audit as a key element of governance. Therefore, the overall responsibility for developing, implementing and monitoring the governance framework rests with the Board of Directors and management.

5 Responsibility of the Internal Auditor

5.1. The nature and extent of internal audit procedures to be conducted in the area of governance is dependent on the framework in place and the maturity of the processes. Where management has implemented a formal governance framework, and unless specifically excluded from the audit scope (or technically not feasible), the Internal Auditor shall plan and perform internal audit procedures to evaluate the design, implementation and operating effectiveness of such framework so as to provide independent assurance to management and to those charged with governance (refer Para 6.1).

5.2. Where no formal governance framework exists, the Internal Auditor shall design and conduct audit procedures with a view to highlight any exposures arising from weak or absent governance activities and processes, make recommendations to implement and strengthen those processes and thereby, improve governance (refer Para 6.2).

5.3. Where the independent assurance requires the issuance of an audit opinion over the design, implementation and operating effectiveness over governance, this shall be undertaken in line with the requirements of SIA 110, “Nature of Assurance”,

especially with regard to the need to have a formal governance framework in place, which shall form the basis of such an assurance (refer Para 6.3).

5.4. The Internal Auditor shall not assume any responsibility to manage or operate the Governanceframework or to take governance related decisions. The focus of the audit procedures is on the process of governance and not the outcome of the process, such as second guessing or questioning the actions or decisions of the governing bodies. Neither is it the responsibility of the Internal Auditor to execute or resolve governance related risks.

6 Explanatory Comments

6.1. Auditing the Governance Framework (refer Para 5.1): Where there is a formal governance framework in place, the work to be performed by the Internal Auditor shall be directed to ensure that, amongst others:

(a) The organisation has designed the framework consistent with best-in-class and globally recognised frameworks;

(b) The organisation has implemented various enabling mechanisms, such as:

(i) Shared organisation vision, mission, objectives, goals and targets;

(ii) Established a code of conduct or ethics and a whistleblower mechanism;

(iii) Acts to identify and address the concerns, and balance the needs, of various stakeholders (internal and external), through open communication and discussion;

(iv) Formed active and functioning governing bodies with defined agendas;

(v) Shared organisation design and structure with clearly defined roles and responsibilities of each position;

(vi) Delegated power and authority through a formal document, duly approved by the Board;


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(vii) Deployed risk-based systems and processes deploying, where possible, technology as a foundation;

(viii) Conducts regular training programs to develop staff awareness and competency in the area of good governance;

(ix) Continuously tracks business performance against budgets and goals with adequate reviews and oversight mechanisms; and

(x) Undertakes active communication and periodic reporting of governance matters to those charged with governance and other stakeholders.

The Internal Auditor will review the governance system and processes in place to evaluate whetherthey are operating in an effective and efficient manner and help to ensure full compliance. Any shortcoming shall result in recommendations for improvement and suggestions on how to make the governance framework more efficient and effective in line with stated objectives.

6.2. Auditing Governance Activities and Processes (refer Para 5.2): Where management has not implemented any formal governance framework, the Internal Auditor will conduct audit procedures over the various governance related activities which may be present (similar to those indicated under Para

3.3, above). These activities may be supported by certain enabling systems and processes (similar to those indicated under Para 6.1, above) and which may be recommended as desirable actions to be undertaken to establish a formal framework.

6.3. Independent Assurance over Governance Framework (refer Para 5.3): In situations where a written assurance report is being issued, the Internal Auditor shall consider the following (as a basis for his opinion):

(a) The linkage of the governance framework with other frameworks such as the Risk, Compliance, Fraud, or Information Technology frameworks which may exist.

(b) The system of compliance certification on governance matters.

(c) The process in place for self-assessment and certification from governance owners as part of a continuous system of compliance.

7 Effective Date

7.1. This Standard is applicable for internal audits beginning on or after a date to be notified by the Council of the Institute.


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ANNOUNCEMENTS

This has reference to the Advisory to Regional Councils and Branches, issued on 11th March, 2020 regarding avoiding large gathering as precautionary measure to prevent any spread of COVID-19.

The Council at its Special Meeting held on 12th March, 2020 has reviewed the said Advisory in light of the ongoing spurt of the COVID-19 virus and in the interest of the well-being of Members and Students and other stakeholders, decided as a proactive measure to completely restrict conduction of any programme / class by any Regional Council/Branch/Central Level Committee, Students Association, Branches of Student Associations, CPE Study Circle of ICAI or any other Programme Organising Units (POUs), requiring physical presence of Members and Students with immediate effect, till 15th April, 2020 or any further direction in the matter.

Further, the Council has decided that 20 hours structured CPE learning which is mandated to be completed by Members below 60 years holding COP, in each calendar year, wherein 04 hours of structured learning could be through e-Learning Videos available on ICAI Digital Learning Hub, conducted and monitored by ICAI and its Central Committees (on MCQ and result basis), has been extended to 10 hours till 30th June, 2020. All the Central level Committee Secretaries are advised to further expand the repository of online subject modules for Continuing Professional Development of membership.

Accordingly, the Council decided to issue Direction to all concerned directing them not to conduct any programme(s) / Class(es) relating to Members and Students with immediate effect till 15th April, 2020 or any further direction in the matter. All the programme(s) / class(es) already announced and in progress shall also be cancelled/ postponed, till that date.

You are requested to kindly ensure compliance to the above directions of the Council.

(Rakesh Sehgal)

Acting Secretary

12th March, 2020

ICAI/028/RBA/2020/RCB-Misc (COVID-19)


34

YRELLG A

OTOHP


35

L-R: CA. Dinesh Kumar Jain- Secretary CIRC, CA. Atul Mehrotra- Vice Chairman CIRC, CA. Atul Agrawal- Chairman CICASA, CA. Churchill Jain- Regional Council Member (The then Vice Chairman CIRC), CA. Pramod Kumar Boob- Central Council member, CA. Satish Kumar Gupta- Central Council member, CA. Mukesh Bansal- Regional Council Member (The then Chairman CIRC), CA. Anuj Goyal- Central Council member, CA. Prakash Sharma- Central Council member, CA. Abhisak Pandey- Regional Council Member (The then Secretary CIRC), CA. Abhishek Sharma- Regional Council Member (The then Treasurer CIRC), CA. Devendra Kumar Somani- Chairman CIRC, CA. Sachin Kumar Jain- Regional Council Member during the 15th Annual function of CIRC hosted by Agra branch of CIRC on 28th February 2020 at Agra.

A group view of the 15th Annual function of CIRC hosted by Agra branch of CIRC on 28th February 2020 at Agra.


36

L-R: CA. Anuj Goyal- CCM. Lighting the lamp ceremony during the convocation held on 4th January 2020 at Kanpur.

CA. Abhisak Pandey Secretary CIRC, CA. Mukesh Bansal- Chairman CIRC, CA. Kemsiha Soni- CCM, CA. Manu Agrawal- CCM &

L-R: CA. Anuj Goyal- CCM, CA. Atul Agrawal- RCM & CA. Atul Mehrotra- RCM during the distribution of Certificates to the newly

qualified Chartered Accountants on the occasion of convocation held on 4th January 2020 at Kanpur.

CA. Abhisak Pandey Secretary CIRC, CA. Mukesh Bansal- Chairman CIRC, CA. Kemsiha Soni- CCM, CA. Manu Agrawal- CCM,


37

The Institute of Chartered Accountants of India (Set up by an Act of Parliament)

Central India Chartered Accountants Students Association

STUDENT’S SECTION

From the Desk of Chairman CICASA... CA. Atul Agrawal Chairman CICASA of CIRC


38

Dear Students,

It gives me immense pleasure to interact with you

all as the Chairman – CICASA of CIRC of ICAI. At the

outset I would like to convey my warm greetings

to one and all on the occasion of Holi. I hope this

auspicious occasion brings you positive energy,

and the optimism to achieve success. Do take into

account-

“Whenever you come across darkness in your

life do falter. Always remember that there is

light at the end of the tunnel.”

The Chartered Accountancy profession is very

dynamic, challenging and remunerative. In

today's era the profession is growing fast and it

has spread out its wings in the wide horizon.

Needless to say, the Chartered Accountants play a

very important role in the society by providing

reliable and correct information to stakeholders,

regulatory authorities and to the society at large.

The Chartered Accountants today are performing

multifarious roles in the fields of business finance,

information technology, corporate management,

risk management and corporate law etc. in

addition to the conventional role in the realm of

accounting, auditing and taxation. Hence, the

opportunities for the accounting professionals

are vast and wide.

A student of Chartered Accountancy course gets

exposure in diverse subjects like Accounts, Audit,

Finance, Taxation, Management, Law and

Technology which no other course offers. The

unique combination of theoretical and practical

training trains students in the rigors of the

profession and prepares them to face the

challenges of the business world.

The Institute values its students and it strives to

provide them the best infrastructure, scholastic

opportunities and exposure that would sharpen

their skills and shape them into world class

professionals. Keeping in view the same the Board

of Studies has set up a Student Skills Enrichment

Board (BOS Operations) with the objective of

providing its students with a platform to enhance

their leadership and inter-personal skills.

If you are looking at fulfillment, independence,

respect, name and fame and a challenging career,

this is the apt course for you. It is my firm belief that

by opting for CA Course, you can surely embark on a

satisfying professional career that will help you to

reach great heights. The Institute is always very

proactive to provide you myriad opportunities to

achieve your goals. It organizes Career Counseling

Programmes to guide you to choose a career path

that is most suitable to your abilities, interest and

aptitude. It also provides numerous opportunities

to polish your talent via debates, quiz, discussions; I

urge you to come to the front and become a part of

the same, I believe together we can embark upon a

journey to make our profession outshine in the

world of severe competition.

Last but not the least, I extend my best wishes to all

the students who are all set to undertake CA Course

as their career option. I would also like to

acknowledge assiduous efforts of Board of Studies

for playing a pivotal role in fulfilling and shaping the

professional needs and growth of our students.

Wishing you all a fulfilling career,

Warm Regards,Sd/-

[email protected]

CA.Atul Agrawal

Chairman CICASA of CIRC

How to clear CA exams CA. Sheetal [email protected]


39

CA course defines your attitude towards Life !!!

The rigour that goes into being a CA is a lesson in

the management of life. This qualification

provides you with sea of opportunities. And yes,

this definitely comes with a price. Price of

investing yourself completely and entirely. It calls

for the highest level of determination, discipline

and a very clear planning towards achieving your

goals. From my personal experience, I would say

the course is not tough but the toughness comes

from how best we manage ourselves while

approaching the course. In this journey you have

to take utmost care of your physical and mental

fitness, the quantity and quality of food intake and

above all the quality of thought process has to be

positive. This course calls for a focussed approach,

which comes from less usage of gadgets, social

gatherings, facebook etc.

Another thing which I feel strongly helps is the

studies done in “Brahma Muhurta”. This

Muhurtais really beneficial for the studies, one

who practices to study at this time will enjoy with

knowledge throughout his life. In this journey of

yours, our institute ICAI provides the best of

knowledge sharing with you. The study material

and the revisionary papers provided by ICAI are

upto the mark. Another important lesson which I

received from my seniors is that Chartered

Accountancy course should never be the second

option and there should be “No looking back”. One

should never appear the exams without thorough

preparations.

As much experience as you gain, remember to be a

student for life. Bewilling to work hard and learn

continuously and you will be a proud member of

ICAI once you qualify your exams. With this, I wish

you a successful and satisfying future ahead and the

courage to pursue your dreams.


40

ARTICLESHIP TRAINING - THE BACK BONE OF CA COURSE

Q: When can I commence Practical Training, if I am through Foundation/ CPT route?

Q: When can I commence Practical Training, if I am through Direct Entry Route?

Q: When can I commence Practical Training, if I have qualified Intermediate level examination of Institute of Company Secretaries of India or Institute of Cost Accountants of India?

Q: What is the duration of Practical Training?

Q: I am in first year of Practical Training, can I take transfer?

Q: What is the entitlement of a firm/ member to train articled assistants?

Ans: After passing either or both of the groups of Intermediate examination / IPCC and successfully completing Four Weeks Integrated Course on Information Technology and Soft Skills (ICITSS) / ITT & OC, you can commence Practical Training.

Ans: Immediately after registering for Intermediate / IPCC Course and successful completion of Four Weeks Integrated Course on Information Technology and Soft Skills (ICITSS) / ITT & OC, you can commence Practical Training.

Ans: After passing either or both of the groups of Intermediate examination / IPCC and successfully completing Four Weeks Integrated Course on Information Technology and Soft Skills (ICITSS) / ITT & OC, you can commence Practical Training.

Ans: Three years.

Ans: Yes. You may take transfer in the first year of Practical Training.

Ans: Regulation 43 provides that subject to such terms and conditions, as the Council may deem fit to impose in this behalf, the members designated as an associate or a fellow, who has been in practice continuously, whether in India or elsewhere or an associate or a fellow, who is deemed to be in practice

within the meaning of Explanation to sub-section (2) of section 2 of the Act, shall only be eligible to engage an articled assistant or assistants. An associate or a fellow shall be entitled to train such number of articled assistant or assistants, under such terms and conditions, as are specified in Tables I and II given hereinafter:

Ans: Transfer / termination of the articleship after completion of first year of articled training is possible on satisfying any one or more of the conditions as stated below: -

1. Medical grounds requiring discontinuance of articles for a minimum period of three months (on production of a Medical Certificate issued by a Government Hospital).

2. Transfer of parent(s) to another city. 3. Misconduct involving moral turpitude. 4. Other justifiable circumstances / reasons: -

i. Grounds already permissible in the Chartered Accountants Regulations, 1988(on submission of requ is i te p roo f o f the ac t war ran t ing transfer/termination of articleship): -

a. Industrial Training (Regulation 51) b. Secondment of articles (Regulation 54) c. Death of Principal [Regulation 57(1)©] d. Ceasing of practice by the Principal [Regulation 57(1)(a)] e. Removal of name of the Principal from the Register

of Member due to anyreason [Regulation 57(1)(b)]

ii. Marriage basis (only if there is relocation to another city involving distance of 50kms or more).

iii. Irregular payment or non payment of stipend with reference to Regulation 67.iv. Articled assistant desires to serve balance period of training outside India.

v. Shifting by the Principal to another city involving distance more than 50 kms.

Q: I am in 2 nd / 3 rd year of Practical Training, what are the rules for transfer?

FAQ


The articled assistants are required to get the permission from the Institute before getting Form 109 signed by the Principal in their own interest.

The request, on any one or more of the aforesaid grounds, of an articled assistant on a plain paper alongwith the recommendation/ consent of the Principal for transfer / termination of articleship accompanied by evidence/proof (self-attested by the articled assistant) to the satisfaction of the Institute be made. Request for transfer not accompanied by consent of Principal shall not be accepted.

Q: I wish to undergo Industrial Training, when can I do the same?

Ans: If you have qualified Intermediate / IIPC Examination can undergo industrial training during the last year of prescribed practical training in Industrial Organisations approved by the ICAI. The period of such training may range between nine and twelve months by informing the Principal about your intention to undergo industrial training at least three months before the date on which such training is to commence.

Ans: Yes.

Q: Does the period covered in Industrial Training will be counted in 3 years of Practical Training?

TABLE – II(Applicable to members who are in full time salaried employment under a chartered accountant in practice or a firm of such chartered accountants)

In context of the above, it may be noted that member in full time employment with a firm of chartered accountants shall be entitled to train one articled assistant provided he has been in employment with the same firm for a continuous period of three years.

TABLE – I(Applicable to members practising the profession of chartered accountants in his individual name or as proprietoror as partner)

Category

Category

1.

1.

Upto 100

An associate or fellow in continuous practice for a period upto 3 years

100 + 50% of the number of such employees above 100 (i.e., a maximum of 300)

3

1 per employee

1

Between 101 and 500

An associate or fellow in continuous practice for any period from 3 years to 5 years

From 501 or more

An associate or fellow in continuous practice for any period from 5 years to 10 years

An associate or fellow in continuous practice for any period from 10 years

300 + 20% of the number of such employees above 500

7

10

2.

2.

3.

3.

4.

Number of full time salaried employees– irrespective of whether associate or fellow

Period of Continuous Practice

Entitlement of articledassistant or assistants

Entitlement of articledassistant or assistants

41


Q: Under whom a student can undergo Industrial Training?

Q: How can an industry register itself for imparting Industrial Training?

Ans: Industrial training shall be received under a member of the Institute employed in the Industrial Unit or Member in Industry. An Associate who has been a member for a continuous period of at least three years shall be entitled to train one industrial trainee at a time and a fellow shall be entitled to train two industrial trainees at a time, whether such trainees be articled assistants or audit assistants.

Ans: As per the Regulation 51 of CA Regulations,1988-(Revised 2013), below are the requirement for registration of company desiring to impart Industrial Training to the Article Assistants:

1. 1. Any of the Financial, Commercial, Industrial undertakings with minimum fixed assets of Rs. 1 crore; or minimum turnover of Rs. 10 Crore; or minimum paid – up share capital of Rs. 50 Lakhs; or such other Institution or organisation as may be approved by the Council from time to time may apply for registration;

2. A copy of printed and published, audited balance sheet of the immediate previous year indicating minimum total turnover of the Company for Rs. 10 crore needs to be sent as a proof alongwith the prescribed application from for its registration.

3. In case of a company abroad registering for Industrial Training, the member/ Company though eligible to impart Industrial Training under CA Regulation 51 but is unable to submit Annual Report / Balance sheet of the Company a self declaration about the financial particulars may be filled by the Company/ member along with application for registration.

4. The Company should have working Chartered Accountants who is an Associate or Fellow Member of the Institute for a continuous period of at least three years and more shall be entitled to train Industrial Trainee and Associate member will be entitled to train one and a Fellow Member shall be entitled to train two Industrial Trainees at a time, whether such trainees be articles assistants or audit assistants.

5. Employment of member intending to provide Industrial training must be in record of the Institute for determination of member’s association with the Company and period thereof. In case, if it if not already noted in the record of the Institute, Company/ organisation should file a written intimation\ to ICAI to note date of joining, designation and details of job profile of the concerned member.

6. Every principal engaging Industrial Trainee shall pay every month a minimum monthly stipend with reference to CA Regulation 1998.

42


Five tips to help manage stress

Stress occurs when you perceive that demands placed on you — such as work, school or relationships — exceed your ability to cope. Some stress can be beneficial at times, producing a boost that provides the drive and energy to help people get through situations like exams or work deadlines. However, an extreme amount of stress can have health consequences, affecting the immune, cardiovascular and neuroendocrine and central nervous systems, and take a severe emotional toll.

Untreated chronic stress can result in serious health conditions including anxiety, insomnia, muscle pain, high blood pressure and a weakened immune system. Research shows that stress can contribute to the development of major illnesses, such as heart disease, depression and obesity.

But by finding positive, healthy ways to manage stress as it occurs, many of these negative health consequences can be reduced. Everyone is different, and so are the ways they choose to manage their stress. Some people prefer pursuing hobbies such as gardening, playing music and creating art, while others find relief in more solitary activities: meditation, yoga and walking.

Here are five healthy techniques that psychological research has shown to help reduce stress in the short- and long-term.

Take a break from the stressor. It may seem difficult to get away from a big work project, a crying baby or a growing credit card bill. But when you give yourself permission to step away from it, you let yourself have time to do something else, which can help you have a new perspective or practice techniques to feel less overwhelmed. It’s important to not avoid your stress (those bills have to be paid sometime), but even just 20-minutes to take care of yourself is helpful.

Exercise. The research keeps growing — exercise benefits your mind just as well as your body. We keep hearing about the long-term benefits of a regular exercise routine. But even a 20-minute walk, run, swim or dance session in the midst of a stressful time can give an immediate effect that can last for several hours.

Smile and laugh. Our brains are interconnected with our emotions and facial expressions. When people are stressed, they often hold a lot of the stress in their face. So laughs or smiles can help relieve some of that tension and improve the situation.

Get social support. Call a friend, send an email. When you share your concerns or feelings with another person, it does help relieve stress. But it’s important that the person whom you talk to is someone whom you trust and whom you feel can understand and validate you. If your family is a stressor, for example, it may not alleviate your stress if you share your works woes with one of them.

Meditate. Meditation and mindful prayer help the mind and body to relax and focus. Mindfulness can help people see new perspectives, develop self-compassion and forgiveness. When practicing a form of mindfulness, people can release emotions that may have been causing the body physical stress. Much like exercise, research has shown that even meditating briefly can reap immediate benefits.

Let’s Talk About Mental Health

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ANNOUNCEMENTS

e-Books for Foundation Course

The Board of Studies in its continuous endeavour to facilitate students in learning anytime and anywhere by leveraging technology, had introduced e-Books in the form of PDF files for the benefit of the students registered under the new scheme of education and training in August, 2017.

The Board of Studies moving forward, has started implementing comprehensive e-Books with integrated video lectures and MCQs in order to provide all the resources related to a topic at the same place with their correct positioning inside the unit/ chapter. Students will be able to get all the learning resources integrated in a manner that will enhance their learning experience and assess their conceptual clarity as well.

In the first phase, the Board of Studies and the e-Learning Group of ICAI have jointly launched the e-Books for Foundation Course on July 1, 2019. E-Books for Intermediate and Final Courses will also be offered in subsequent phases.

The advantages of enrolling in these e-Books are as under:

¬ Integrated learning resources with self-assessment at single place¬ Anytime, anywhere and any pace learning¬ Learning can be tracked to assess oneself¬ Free of cost¬ Save time and money for attending classes elsewhere

Students enrolled in Foundation Course are advised to take advantage of these e-Books for studying anytime/ anywhere and reap maximum benefits. These e-Books are available at

and can also be accessed through .

Director, Board of Studies

https://learning.icai.org/elearning Self Service Portal (SSP)

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Such article, of not more than 2500 words (original and not having been published or hosted anywhereelse) with executive summary and authors photographs, should be sent at [email protected] Theauthors are also required to give a declaration of originality and a brief profile along with the articles.

Thanks & Regards Team CIRC


Invitation to Students to Contribute ARTICLES

in Monthly E-Newsletter of

CIRC of ICAIPlease send articles at:

[email protected]

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Have a Designated Study Space # Study Tips

This is your life and it is your responsibility.

What happens now is up to you.

There will be no one taking you by the hand anymore, there will be no one to teach you anything new, and there will be no one to catch you when you fall. Your life is your responsibility now, and what happens now is up to you.

If you decide to stop learning, stop growing, stop moving forward and stop working on yourself, you will stop improving and the world will pass you by.

You have the Freedom to do that if you chose!

But if that is not the life you envision for yourself then you have to do something about it. No one will do it for you.

What happens now is up to you!

If you work hard, read a book a week, get a mentor, leave your comfort zone, stand up after every failure and improve, it will eventually lead you to a different life.

You have the Freedom to do that too, if you chose!

You can do whatever you want to right now, that’s the beauty of being your own person and getting to chose how to live your life. The world is open and it is yours to do with it as you please!

But that also means that you have the responsibility to make it the way you want it to be. It won’t happen on it’s own.

What happens now is up to you!

Some of you will go on to become artists, scientists or athletes, and others will become family men and women while others still will become entrepreneurs and CEOs. Some of you will travel the world while others will never travel beyond the borders of your state. But every single one of you will have a completely unique experience!Not one path is better than the other, as they are all valuable in their own right; and you can choose any one of them. You have the power now to make this life whatever you want it to be.

What happens now is up to you, dear students!

Which path you will go is on you, what you will gain is on you, what you will miss is on you, and where you will end up is on you too. It is all your Freedom and your Choice!• Chase your dreams without justifying it to anyone! As long as it matters to you it matters!• Be brave and bold and do not wait to regret it! As soon as you want something, get it, even if it terrifies you!• Be the person that you want to be and do not listen to the masses!• Love yourself and your life for what it is and change it every time it doesn’t feel right!• Let go of whatever keeps you bound or restricted so that you keep that freedom alive that you have and use it!• Do not blame others for what your life turns out to be. It is your responsibility, not theirs.• Make mistakes, fail, laugh about it, stand back up, and try once more!• And never, ever, give up on what matters to you.

Take your life into your hands and live it with full force! What happens now is up to you, so Make it a life worth living!

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YRELLG A

OTOHP


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L-R: CA. Sudhindra Jain - Speaker, CA. Atul Mehrotra- Vice Chairman CIRC during full day programme (INIESTA) on Seminar on

Union Budget on February 16, 2020 organised by CIRC with CICASA,Kanpur

CA. Abhisak Pandey the then Secretary CIRC, CA. Mukesh Bansal- the then Chairman CIRC, CA. Manu Agrawal- CCM &

A view of Quiz competition organised during full day programme (INIESTA) on Seminar on Union Budget on February 16, 2020 organised by CIRC with CICASA,Kanpur


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A view of event Spot the Light organised during full day programme (INIESTA) on Seminar on Union Budget on February 16, 2020 organised by CIRC with CICASA,Kanpur

A group view of full day programme (INIESTA) on Seminar on Union Budget on February 16, 2020 organised by CIRC with CICASA,Kanpur


EDITORIAL BOARD

Editor-in-Chief

Disclaimer :

The views and opinions expressed or implied in this e-Newsetter are those of the authors and do not necessarily reflect those of CIRC of ICAI

Address : CIRC of ICAI, ICAI BHAWAN, 16/77 B, Civil Lines, Kanpur-208001

Phones : (0512) 2396502 * 2396503 * 2396501

E-mail : [email protected]* Website: www.circ-icai.org

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CA.Devendra Kumar Somani