CA. Naresh Jakhotia

TAX TALK-03.10.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “RS. 100/- PER DAY PENALTY FOR NON FILING OF QUARTERLY TDS RETURN” Query 1] Sir, I have two house properties in Gujarat (Kutch & Ahemdabad) purchased by me in the year 1978 & 1982. I wish to sale the same in the current year. The capital gain roughly calculated on the above flat sell is around Rs. 43 Lacs & Rs. 67 Lacs respectively. I wish to purchase two flats, one in Raipur & the other one in Nagpur for Rs. 60 Lacs each. I have two sons, one in Raipur & the other one in Nagpur. The flat is intended to be purchased by me with my son name as the co-owner in each of the flat separately. I have following queries for which I seek your guidance: 1. Whether the capital gain amount will be exempt as my total investment in the residential house properties will exceeds the total amount of capital gain? 2. Whether the exemption is restricted to purchase of one house property or both the h...

TAX TALK-26.09.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “EMPLOYEE WELFARE TRUST ALLOTING SHARES TO ITS EMPLOYEE AT A DISCOUNTED PRICE-INCOME TAX IMPLICATION” Query 1] Sir, I am in the Company which got listed last year at NSE & BSE. The Company is having Employees Welfare Trust before its got listed in NSE & BSE. Employees Welfare Trust is holding shares of the Company since more than 5 to 6 years. Now Employees Welfare Trust is offering shares to employees (based on their tenure, performance & designation) at a discounted rate (say Rs. 15) as compared to the market rate around Rs. 200 on the date of transaction. I have accepted the offer and bought shares, with lock-in period of 6 months (insider trading). I am getting contrasting opinion on the matter and confused, whether difference of Fair Market Value - Purchase Price (Rs. 200/- – Rs. 15/-) i.e., Rs. 185/- is taxable as income from other source? Or, it will be taxable as and when I will ...

TAX TALK-19.09.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “IS IT MANDATORY TO FILE THE ITR WITH DIGITAL SIGNATURE NOW?” Query 1] I have a query. Kindly provide me your opinion. I had purchased a property from a builder. I had made part/full payment to the builder. But due to some reasons I did not register the property. Now I wish to sell the property. The purchaser would make me the payment and the builder would come for the registration to register the property directly in favor of new buyer. I want to know whether the profit arising from the transaction would be considered as Capital Gain or as Income from Other Source? Kindly elaborate with section under the Income Tax Act. [Rahul Agarwal- keepwalkingalways@ gmail.com] Opinion: It appears that you have purchased the flat and the possession of the flat was handed over to you by the builder. Due to some technical or procedural lapses, the sale deed appears to have not been executed in your favor. Since t...

TAX TALK-12.09.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “MCX PROFIT- WHETHER SPECULATIVE?” Query 1] Sir, what is the right procedure to compute Income Tax on MCX transactions (Profit or Loss)? Is it a speculative profit or loss? Income of a salaried Senior Citizen from Salary and all other sources is Rs. 2 Lacs. His profit from MCX transactions of Silver is Rs. 75,000/- & from Sugar is Rs. 25,000/-. What will be his tax liability? [srf.fatnani@yahoo.co.in] Opinion: 1. The Central Government has notified NSE, BSE, MCX stock exchanges & United Stock Exchange of India Ltd as a recognized stock exchange for the purpose of section 43(5) as a result, the profit/loss in MCX is not considered as a speculative profit/loss. The expenses incurred like brokerage, transaction charges are deductible expenses while working out the profit/ loss from the transactions. 2. The total income of the senior citizen mentioned in the query is of Rs. 3 Lacs. It is presume...

TAX TALK-05.09.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “IS IT COMPULSORY TO QUOTE DOCUMENT IDENTIFICATION NUMBER?” Query 1] Sir, Kindly clarify the following points in the Tax Column of “The Hitavada” 1. Is it compulsory to mention ‘Document Identification Number’ (DIN) in the Income Tax return for Assessment Year 2011-2012? Kindly enlighten me about the procedure for getting DIN? 2. On Reorganization of share capital, company allots new shares in definite proportion to the old shares and for fractional shares, company sends cheque/draft in lieu of the same. How this amount of fractional share is treated in Income Tax. Can we assume that the Security Transaction Tax is deducted for claiming exemption under L.T.C gain? 3. On transfer of equity shares through Stock Exchange, is it not compulsory to deduct Security Transaction Tax in all the shares traded through Stock Exchange. 4. Regarding Interest on cumulative term deposit with banks, referring C.B.D.T...

TAX TALK-15.08.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “INCOME TAX ON ACQUISITION OF AGRICULTURAL LAND” Query 1] I had bought an agriculture land (6 acres) for Rs. 15,000/- in 1987-88 situated in Rural area, 35 kms from Nagpur. Now govt. wants the land for industrial development. It offered Rs. 13 Lacs per acre. I am in Government Service with annual salary of Rs. 6.50 Lacs & in tax bracket of 30%. I don’t have any other income. My queries are 1. Whether LTCG is applicable for project affected land? 2. If yes, what are the tax implications there on? 3. What are the remedies to minimize the taxes? 4. My uncle posses 5 acre land at same place as ancestral property. Will he be also required to pay LTCG tax? [bondre_vira@yahoo.in] Opinion: Rural Agricultural Land is not a capital assets & income arising from transfer of agricultural land is not at all chargeable to tax as Income from capital gain. Agricultural Land is considered as Rura...

TAX TALK-22.08.2011-THE HITAVADA TAX TALK BY CA. NARESH JAKHOTIA (Chartered Accountant) “NO LOAN SHOULD BE TAKEN AGAINST LTCG BONDS” Query 1] a] Sir, I have paid the insurance premium of the policy taken out by my mother as proposer for me. Similarly, I have also paid the premium of my younger brother. The premiums were paid by me by cheques only & my bank passbook reflects both the above payments. The LIC Premium receipts are, however, issued in their name (Mother & Brother). I want to know whether I will be able to get income tax deductions towards these payments. Similarly, if I make the LIC Premium payment of my father in the F.Y. 2011-12, whether I will be eligible for income tax deduction? Please elaborate. b] I have read in the earlier issues regarding the investment in the REC/ NHAI Bonds for saving Long Term Capital Gain Tax. Accordingly, I have invested in the bonds issued by NHAI, 1 ½ years back. I am in need of some amount for purchase of one agricultural La...