SICASAJUNE- 2020 Vol IV/ No.6
Kanchipuram District Branch of Southern India
Chartered Accountants Students Association
(SICASA) of ICAI
Location:Flat No,402, Fourth Floor, No 1A,Periyalwar Street,Sundaram Colony, East Tambaram, Chennai-600059
Email:[email protected], Ph:044 22390098
Kanchipuram District Branch of SIRC
SICASA CHAIRMAN’S MESSAGE TO STUDENTS
CA K R Sathiyanarayanan
Chairman,
SICASA of Kanchipuram District Branch of SIRC of ICAI
My Dear Students,
Greetings to all of You!
“The stories we share today, shape the World that we live in
tomorrow”.
The current scenario is one which will test us thoroughly in every aspect of our
professional and personal lives.Adopting and following a routine can help you cope with
stress and anxiety in times like these.
Build a support system for your mental health and walk a fine line balancing our
professional and familial responsibilities.
At this moment,to reduce social contact and to minimize the associated risk of
transmitting the disease we are forced to work from home to ease the way of moving
forward in our profession.
While technology can still be learnt with ease, the accounting work can be done online,
often from anywhere and currently from one’s home. It is the complete package which
has to implemented in order to move ahead professionally in the new digital world.
With such immense responsibilities resting on our shoulders and the highest
professionalism expected from us, we cannot afford to let situations dictate over us but
we should have the ability to adapt to the Change.
My Dear Students, “Think proactively and dynamically” which will be our pillar of spiritual
growth and meaningful development.
FROM CHAIRPERSON’S DESK
With warm wishes,
CA G GEETHA,
CHAIRPERSON,
KANCHIPURAM DISTRICT BRANCH OF SIRC OF ICAI.
My Dear Students,
Hope every one of you are safe with your family members.
Lock down 4.0 has come to an end and some relaxation is given
across the country.
But our TN especially Chennai, Chengalpattu, Kanchipuram &
Thiruvallur districts continue to be in Red zone. So restrictions
continue in these zones until 30th June 2020.
The adversities are to be transformed into opportunities and every one of you must focus
to attain your goal of becoming a successful Chartered Accountant.
CA examinations are postponed once again due to Covid 19, to end July 2020.
Students who are appearing for the forthcoming examinations, would have utilized the
lock down period in preparing for your examination well.
Please make use of the Crash Courses and Revision courses conducted by ICAI & SIRC.
I congratulate and appreciate the article contributors for SICASA e-Newsletter even in this
lockdown period.
I invite other students also to contribute articles or news items for SICASA e-newsletter.
I would like you all to use the time effectively in improving your skills and talents.
Keep pace with working and commitments in every front.
Stay Safe. Stay Healthy.
SICASA TEAM – 2020
CA K R Sathiyanarayanan – Chairman
CA Madhumitha R– Chairperson Student’s
Committee
Members - Student’s Committee:
CA Shiva Chandra Reddy
CA Arumugaraj P
CA Priya A
CA Aanand P
Annapoorani C – Vice Chairperson
Rubika C V – Secretary
Manju R – Treasurer
Haarika kavirala – Joint Secretary
Members:
Sathkrithi T T
Subathra R C
Aiyswarrya M
Vaishnavi B S
Lavanya Karumanchi
Editorial Board
EDITOR : CA. K R Sathiyanarayanan
MEMBER : CA Madhumitha R
: CA Arumugaraj P
: CA Priya A
Note: The views expressed in the articles published are their own views and
SICASA Kanchipuram District Branch does not endorse or take responsibility for the
views expressed in the articles.
ARTICLES INVITED FROM STUDENTS:
Note: Articles are invited from students for publishing in newsletter. The articles shall be
either on the specific subject or a general article.
Students can mail their article with Name, SRO Number, Mobile Number, Residential
Address, Office Address & Photo to our Mail mentioned below
Contact Us
For Knowing about all the events conducted by the SICASA-Kanchipuram District
Branch (East Tambaram Chennai-59) reach us through:
Phone - 044-22390098
Mail ID - [email protected]
Face Book Page - SICASA Kanchipuram District Branch Of SIRC
Instagram Page - kpmsicasa
Website - kanchiicai.org
➢What do you want to do with
your life?
➢Highlights of the Atmanirbhar
Bharat Abhiyaan
➢Amendments w.r.t Trusts &
NGOs
➢Block Chain Technology
Annapoorani C
SRO0675999
What do you want to do with your life?
It is a question almost everyone asks themselves.
It is also a question I don’t believe one should bother asking
in the first place.
We need not make big life decisions even before we start
anything.
But we must always realize and remember one thing ‘we are
born with a Passion.’
Passion evolves; all that we have to do is make it work.
Sometimes it is easier,
Sometimes it is harder,
But the only way to get there is to START!
It is said that life is an unpredictable journey; it can just twist and travel.
So we just need to follow through our hard work and the end result of the same is our
own satisfaction.
We don’t have to know the final answer; we just need to act on the next step.
One of my friends says “Invest more time in Sharpening the axe and then start chopping
the tree down instead of Chopping the tree with a blunt axe.”
Our exams are round the corner, the happening of the same has itself become a question
mark because of the situation which the whole world is facing now. But, one thing is sure,
somehow, some day or the other we are going to get through it.
So, let us work hard from today with a plan in action, great grit, optimistic thinking and
self-confidence.
At the end I would like to quote Swami Vivekananda
“Arise, Awake and Stop not till the Goal is reached.”
Thank You!
With warm Regards
Annapoorani C
HIGHLIGHTS OF THE ATMANIRBHAR BHARAT ABHIYAAN
Prithika J P
SRO0576115
In the wake of COVID-19 outbreak, the Prime Minister had
announced a COVID-Relief Package of Rs. 20 Lakh Crore to
support the Indian Economy against its fight of the global pandemic
crisis of COVID-19.
The package focuses on the development of the Economy,
Infrastructure, System, Vibrant Demography and Demand and is
equivalent to 10% of India’s GDP and caters to various sections
including MSMEs and the middle class, among others.
Key Highlights of the Special Economic & Comprehensive Package
are summarized below:
Credit Facilities to Businesses / MSMEs:
1) Emergency credit support from Banks and NBFCs
Amount to be given Up-to 20% of entire outstanding credit as on 29.2.2020
EligibilityBusiness with up-to;
• Rs.25 Crore Borrowings
• Rs.100 Crore Turnover
Loan Tenure &
Other Terms
4 year tenor; with
• Moratorium of 12 months on Principal Repayment
• Interest to be capped
• 100% Credit Guarantee Cover
• No Guarantee Fee / No Fresh Collateral
Last date of availment 31st October 2020
2) Subordinate Debt for Stressed MSMEs from Banks
Eligibility Functioning MSMEs which are NPA or Stressed
Mode of Usage To be infused as equity in the unit
Provision Coverage Rs.20,000 Crore
3) Fund of Funds Plan
Eligibility MSMEs with growth potential and viability
Mode of Operation Through Mother Fund and a few Daughter Funds
Objective Will encourage MSMEs to get listed
4) Expansion in the scope and definition of MSMEs:
Classification Existing Provisions Amended Provisions
Manufacturing Services Manufacturing and Services
Micro Investment not
more than
Rs. 25 Lakhs
Investment not
more than
Rs. 10 Lakhs
Investment not exceeding Rs. 1
Crore and Turnover not
exceeding Rs. 5 Crores
Small Investment not
more than
Rs. 5 Crores
Investment not
more than
Rs. 2 Crores
Investment not exceeding Rs. 10
Crores and Turnover not
exceeding Rs. 50 Crores
Medium Investment not
more than
Rs. 10 Crores
Investment not
more than
Rs. 5 Crores
Investment not exceeding Rs. 20
Crores and Turnover not
exceeding Rs. 100 Crores
Other Interventions for MSMEs:
1) Global tenders to be disallowed in Government procurement tenders up-to Rs. 200
Crores to reduce unfair competition from foreign companies.
2) E-market linkage for MSMEs as replacement for exhibitions and trade fairs.
3) MSME receivables from Government and CPSEs to be released in 45 days.
Employees Provident Fund Support:
1) Government to pay both employer and employee contribution of PF for eligible
establishments under Pradhan Mantri Garib Kalyan Package from March to July
2020.
2) For other establishments not covered above, the PF contribution of both employer
and employee has been reduced from the existing 12% to 10% for the months of
May, June and July 2020.
Note: CPSEs and PSUs will continue to contribute 12% for employer contribution
Schemes for NBFCs, HFCs and MFIs:
1) Special Liquidity Scheme
Investment to be made in both primary and secondary market transactions in investment
grade debt paper which will be fully guaranteed by Government of India
2) Partial Credit Guarantee Scheme 2.0
To support low credit rating NBFCs, HFCs and MFIs, the existing scheme is extended to
cover borrowings such as primary issuance of Bonds and CPs. Scheme to cover AA
paper and below including unrated papers.
Support to Power Distribution Companies (DISCOMs):
1) Liquidity injection by way of loans to be given against State guarantee by PFC and
REC.
2) Tariff Policy Reform to include:
• Standards of service and associated penalties for DISCOMs and load shedding.
• Progressive reduction in cross subsidies.
• Time bound grant of open access.
• Competitive selection of generation and transmission project developers.
• No regulatory assets and timely payments to GenCos.
• Direct benefit transfer for subsidy and introduction of smart prepaid meters.
3) Privatisation of distribution of electricity in Union Territories.
Relief to Contractors:
1) 6-month extension provided to all Central Agency Contracts which will cover
construction or works and goods & services contracts and all obligations like
completion of work, intermediate milestones and extension of Concession period in
Public-Private-Partnership (PPP) contracts.
2) Government Agencies shall partially release bank guarantees to the extent of the
contract completion.
Real Estate Projects under Real Estate Regulatory Authority (RERA):
1) To treat COVID-19 as “Force Majeure” under RERA
2) Extension of registration and completion date suo-moto by 6 months for all registered
projects expiring on or after 25thMarch, 2020, which may be extended by another 3
months by the regulatory authorities, if needed.
Relief for Migrants:
1) Supply of free food grains to migrants, to be borne by the Government of India and
implemented by the State Government for the months of June and July.
2) Access to any Ration shop in the country via intra-state portability.
3) Affordable Rental Housing Complexes (ARHC)Scheme under Pradhan Mantri Awas
Yojana to provide shelter at affordable rent for migrant labour and urban poor, through:
• Conversion of government funded housing into ARHC under PPP mode through
concessionaire.
• Incentives given to State Government Agencies, Central Government
Organisations, manufacturing units, industries, institutions and associations to
develop ARHC on their lands and operate.
Direct Taxation Measures:
1) Reduction in rates of TDS and TCS by 25% for specified receipts and payments w.e.f
14th May 2020 up-to 31st March, 2021.
2) Pending refunds to Charitable Trusts and Non-Corporate businesses and
professions to be issued immediately.
3) Due dates for Income Tax Returns and Tax Audit are extended as follows:
Income Tax Returns (All Assessee) 30th November, 2020
Tax Audit (All Assessee) 31st October, 2020
4) Due dates for assessments getting barred:
Getting Barred on 30th September, 2020 Extended to 31st December 2020
Getting Barred on 31st March, 2021 Extended to 30th Septemeber, 2021
5) Period for making payment without additional amount under Vivad se Vishwas
Scheme to be extended up-to 31st December 2020.
Other Relief Measures:
1) Special Credit Facilities:
Amount to be given Shishu-Loans of up-to Rs.50,000
Initial Working Capital of up-to Rs.10,000
Eligibility Small Businesses under MUDRA & Street Vendors
Terms of Loans /
Credit
Interest subvention of 2% for a period of 12 months
Relief of Rs.1,500 Crore to MUDRA-Shishu Loanees
Current Portfolio Rs.1.62 Lakh Crore for MUDRA-Shishu Loanees
2) CAMPA Funds Scheme under Compensatory Afforestation Management and Planning
Authority to be approved which will be used by the State Governments for providing
job opportunities mainly for Tribals / Adivasis.
3) Credit Linked Subsidy Scheme which was introduced for personsfalling under the
income group of Rs. 6 -18 Lakhs has been extended up-to 31st March 2021
4) Viability Gap Funding (VGF) Scheme:
Social infrastructure projects to get enhanced VGF by way of 30% each of the Total
Project Cost by the Centre and State / Statutory bodies. Other sectors to get the
existing support of 20%each from GoI and State / Statutory bodies
Measures in Agriculture:
1) NABARD to extend additional refinance support for crop loan requirement of Rural
Co-operative banks and Rural Development Banks
2) Special drive to be undertaken to provide concessional credit through Kisan Credit
Card which will include Fisherman and Animal Husbandry farmers
3) Financing facility to be provided for funding Agri Infrastructure projects at farm-gate
and aggregation points to make post harvest management affordable and financially
viable
4) Scheme to be launched to help unorganised Micro Food Enterprises get technical
upgradation to attain FSSAI food standards which will be implemented in a cluster
based approach
5) Pradhan Mantri Matsya Sampada Yojana - Introduced for integrated, sustainable and
inclusive development of marine and inland fisheries including logistics and activities
ancillary to the same.
6) National Animal Disease Control Programme for Foot and Mouth Disease and
Brucellosis to ensure 100% vaccination of cattle, buffalo, sheep, goat and pig
population
7) Animal Husbandry Infrastructure Development Fund to be set up to support private
investment in dairy processing, value addition and cattle feed infrastructure and
establishing plants for export of niche products
8) Fund to be created for promotion of herbal cultivation to create a network of regional
mandis for medicinal plants and to develop a corridor of medicinal plants along the
banks of Ganga
9) Scheme to be implemented for infrastructure development, marketing and storage
centres and development of quality nucleus stock for beekeeping
10) Operation Greento be extended to all fruits and vegetables on pilot basis for 6
months and aims to provide 50% subsidy on transportation from surplus to deficient
markets and on storage
11) Central law to be formulated to provide adequate choices for farmers to sell their
produce without any inter-state trade barriers and to sell their produce at attractive
prices along with a framework for e-trading of the same.
12) Facilitative legal framework to be created to enable farmers for engaging with
processors, aggregators, large retailers and exporters in fair and transparent manner
for mitigation of risk, assured returns and quality standardisation.
Essential Commodities Act:
To enable better price realisation for farmers and to make the agriculture sector more
competitive, the Government of India has taken the following initiative and measures:
• Deregulation of essential foods like cereals, edible oils, oilseeds, pulses, onions
and potatoes.
• Imposition of Stock Limit only under very exceptional circumstances like national
calamities with surge in prices with exception to value chain participants.
Industrial Infrastructure Reforms:
1) Fast track Investment clearance through Empowered Group of Secretaries (EGoS).
2) Investible projects to be identified by the respective Project Management Cell.
3) States to be ranked on terms of investment attractiveness to compete for new
investments.
4) Incentivising schemes to be introduced in solar PV manufacturing, advanced cell
battery storage, etc.,
5) Scheme for Industrial Cluster Upgradation through challenge mode in all states.
6) Making available the Industrial Land / Land bank for promotion of new investments
and all industrial parks to be ranked in 2020-21.
7) Making information available on Industrial Information System with GIS mapping.
Coal Sector Reforms:
1) Introducing private sector participation in coal sector to increase competition and
transparency and ensure ease of doing business through the following measures:
• Revenue sharing mechanism instead of fixed rupee / tonne regime.
• Open market coal block transactions, unlike earlier where only captive
consumers with end use ownership could bid for the same.
• Liberalisation of Entry Norms with a ceiling on upfront payment.
• Auction of partially explored blocks under Exploration-cum-production regime
where Revenue share will be incentivised if production schedules and plans
are favourable.
• Infrastructure development for evacuation of coal produced by CIL and private
blocks, by investment in mechanised transfer of coal from mines to railway
sidings.
• Concessionalised Commercial Terms to be given to CIL’s consumers by way
of reduction in reserve price in auctions for non-power consumers,
enhancement of credit terms and lifting period.
2) Rebate in revenue share Coal Gasification / Liquefication to be incentivised
3) Coal Bed Methane extraction rights to be auctioned form CIL coal mines
Mining Sector Reforms:
The following structural reforms are to be introduced to boost growth, employment and
bring state-of-the-art technology:
1) Introduction of composite exploration-cum-mining-cum-production regime.
2) 500 mining blocks to be offered through open and transparent auction process.
3) Joint auction of bauxite and coal mineral blocks to help reduce electricity costs.
4) Distinction between captive and non-captive mines to be removed to allow transfer of
mining leases and sale of surplus unused minerals to increase efficiency in mining
and production.
5) To introduce Mineral Index for different minerals.
6) Rationalisation of stamp duty payable at the time of award of mining leases.
Defence Measures:
1) Promotion of Make in India campaign in the field of defence production:
• To notify list of weapons / platforms for ban on import with year wise timeline.
• Indigenisation of Imported Spares.
• Separate budget provision for domestic capital procurement.
2) Corporatisation of Ordnance Factory Board to improve autonomy, accountability and
efficiency
3) Enhancement of FDI limit in defence manufacturing under automatic route from 49%
to 74%
Civil Aviation:
1) Restrictions on utilisation of the Indian Air Space to be eased to make civilian flying
efficient.
2) Commencement of bid for 6 new airports for O&M on PPP Basis. Another 6 airports
to be put out in the subsequent round.
3) Tax regime for Aircraft Maintenance, Repair and Overhaul (MRO) ecosystem
rationalised and convergence of defence sector and civil MRO to be established to
create economies of scale to reduce the maintenance cost for the airlines.
Measures in Aerospace Sector:
Private participation in space sector will provide:
a) Level playing field for private companies.
b) Predictable policy and regulatory environment.
c) Private sector to be allowed to use ISRO facilities to improve their capacities.
d) Future projects for planetary exploration and outer space travel to be opened.
e) Liberal geo-spatial data policy for providing remote-sensing data.
Atomic Energy Related Reforms:
1) Establishing research reactor on PPP basis for production of medical isotopes for
affordable treatment of cancer and other diseases.
2) Establishing facilities in PPP basis to use irradiation technology for food preservation
to assist agricultural reforms and farmers.
3) Technology Development-cum-Incubation Centres to be set up to foster synergy
between research facilities in nuclear sector and tech entrepreneurs.
Corporate Law Measures:
1) Decriminalisation of Company Law defaults – 16 compoundable offences shifted to
an in-house adjudication and penalty mechanism.
2) Introduction of an Integrated Web based Incorporation Form to incorporate
companies electronically.
3) Databank of Independent Directors launched.
4) Enabling companies to conduct Board Meetings, EGMs and AGMs, Rights Issue
through Digital platforms.
Measures in Insolvency and Bankruptcy Code:
1) Minimum threshold to initiate insolvency proceedings raised to Rs. 1 Crore.
2) Special insolvency resolution framework for MSMEs to be notified soon.
3) Suspension of fresh initiation of insolvency proceedings up to one year.
4) COVID-19 related debt to be excluded from the definition of “Default” as the case of
trigger for insolvency proceedings.
MGNREGS:
1) Average wage rate to rise to Rs. 202 from Rs. 182 per day
2) Allocation of Rs. 40,000 crores to generate employment by creation of larger number
of durable and livelihood assets.
Measures in Health Sectors:
1) Public expenditure on health to be increased and investment in grass root level
health institutions to increase health and wellness centres in rural & urban areas.
2) Infectious Diseases block to be added in hospitals in all districts.
3) Integrated public health labs in all districts and block level labs and public health unit
to manage pandemics.
4) National institutional platform for one health by Indian Council of Medical Research.
5) Implementation of National Digital Health Blueprint.
Measures in Education Sector:
1) PM eVIDYA –Programme for multi-mode access to online education.
2) Manodarpan – Initiative for psychological support for students, teachers and families
for mental health and emotional wellbeing.
3) New National Curriculum and Pedagogical Framework for school and early childhood
and teachers to integrate with global and 21st century skill sets.
4) National Foundational Literacy and Numeracy Mission to ensure every child attains
learning levels and outcomes in Grade 5 by 2025 to be launched by December 2020.
Ease of Doing Business:
1) Direct listing of securities by Indian listed companies in permissible foreign jurisdictions.
2) Listed Non-Convertible Debentures of Private companies not to be regarded as listed
companies.
3) Producer Companies to be regulated in Companies Act, 2013.
4) Power to create additional / specialised benches for National Company Law Appellate
Tribunal.
5) Lower penalties for all defaults for Small Companies, One-Person Companies,
Producer Companies and Start Ups.
Public Sector Enterprise Policy:
Announcement of coherent policy where all sectors are open to private sectors and PSEs
will play an important role in defined areas as mentioned below:
a) Strategic sectors requiring presence of PSEs in public interest will be notified.
b) In strategic sectors, at least one enterprise will remain in the public sector.
c) Privatisation of PSEs in all the other sectors (timing based on feasibility, etc.,)
d) Number of enterprises in strategic sectors will ordinarily be only one is to four, others
will be privatised or merged or brought under holding companies.
Extension of support to State Governments:
1) Revenue Deficit grants to states given in the months of April and May.
2) Advance Release of State Disaster Relief Fund in the first week of April.
3) Release of funds by the Health Ministry for direct anti-COVID measures.
4) RBI measures:
a) Enhancement of Ways and Means advances limits increased by 60%
b) Enhancement of overdraft facilities, as follows:
• No. of days states can remain in continuous overdraft increased from 14 to 21
• No. of days states can remain in overdraft in a quarter increased from 32 to 50
5) Enhancement of Net Borrowing Ceiling Limit for FY 2020-21 from 3% to 5%
(Based on Gross State Domestic Product)
The additional 2% will be released in the following manner:
a) Unconditional increase of 0.5%
b) 1% to be released in 4 tranches of 0.25% with each tranche linked to clearly
specified, measurable and feasible reform actions in the following fields:
• One Nation, One Ration Card
• Ease of doing business
• Power Distribution
• Urban Local Body Revenues
c) Further 0.5% if the milestones are achieved in at least three out of the four reform
areas.
A bird’s eye view of the stimulus is as follows:
Particulars Amount (in
Crores)
Emergency Working Capital Fund for Business / MSMEs 3,00,000
Subordinate Debt Fund for Stressed MSMEs 20,000
Fund of Funds for MSMEs 50,000
EPF support for business and workers 2,800
Reduction in EPF Rates 6,750
Special Liquidity Scheme for NBFC / HFC / MFIs 30,000
Partial Credit Guarantee Scheme for liabilities of NBFC /
MFIs
45,000
Liquidity injection for DISCOMs 90,000
Reduction in TDS / TCS rates 50,000
Free food grain supply for migrant workers for 2 months 3,500
Interest subvention for MUDHA Shishu Loans 1,500
Special Credit Facility to Street Vendors 5,000
Housing Credit Linking Subsidy Scheme 70,000
Additional Emergency Working Capital through NABARD 30,000
Particulars Amount (in
Crores)
Additional Credit through Kisan Credit Card 2,00,000
Micro Food Enterprises 10,000
Pradhan Matsya Sampada Yojana 20,000
Operation Green – Top to Total 500
Agri Infrastructure Fund 1,00,000
Animal Husbandry Infrastructure Development Fund 15,000
Promotion of Herbal Cultivation 4,000
Beekeeping Initiative 500
Viability Gap Funding 8,100
Additional MGNREGS allocation 40,000
Earlier measures including Pradhan Mantri Garib Kalyan
Package
1,92,800
RBI Measures (in actuals) 8,01,603
Grand Total 20,97,053
NON GOVERNMENTAL ORGANIZATION
Amendment in Section 12AA/80G/80GGA – Section 12A
Ravi Kumar Avula
SRO0611856
On, February 01,2020 Finance Minister of India, ms. Nirmala
Sitharaman presented the Union Budget 2020 wherein she proposed
substantial amendments for granting exemptions to the charitable /
religious trusts institutions etc. Under the new tax regime, she
proposed to amend Section 10(23C), Section 11, Section12A,
Section 12AA, Section 80G and proposed to insert a new Section
12AB. All these amendments are proposed to be made with effect
from. June 01, 2020.
➢ The following amendments classified the charitable / religious trusts institutions etc. into
four Categories for our easy understanding they are: –
❖ A. Charitable / religious trusts/ institutions etc. registered under existing laws. (‘A
Category’)
❖ B. Charitable / religious trusts/ institutions etc. whose registration expired under
the new provisions in 5 years. (‘B Category’)
❖ C. Charitable / religious trusts institutions etc. having provisional registration
under new provisions. (‘C Category’)
❖ D. Others Cases. (‘D Category’)
Further, the amended provisions have been discussed in brief below:
Basis A Category B Category C Category D Category
Application to
be made for
registration
Within three
months from the
Commencement
of the new
provisions i.e.
June 01, 2020.
Atleast Six
months prior to
the expiry of the
registration.
Within Six Months
from the
commencement of
activities or six
months prior to the
expiry of provisional
registration,
whichever is earlier
Atleast one
month prior to the
commencement
of the previous
year relevant to
the assessment
year for which
approval is
sought.
Basis A Category B Category C Category D Category
Order to be
passed
Commissioner or
Principle
Commissioner
shall pass an
order in writing
granting approval
for five years
Commissioner or
Principle
Commissioner
shall pass an
order in writing
granting approval
for five years
after verifying the
genuineness of
the activities and
objects by calling
for any document
as, he may deem
it
Commissioner or
Principle
Commissioner
shall pass an order
in writing granting
approval for five
years after
verifying the
genuineness of the
activities and
objects by calling
for any document
as, he may deem
fit.
Commissioner or
Principle
Commissioner
shall grant in
writing the
provisional
registration for
three years and
send a copy of
such order to the
Charitable/
religious trusts
Institutions etc.
Income on
which new
provisions and
registration
shall apply
Assessment year
from which
approval was
earlier granted to
it
Immediately
following the
financial year in
which such
application is
made
From the first of
the assessment
years for which
provisional
Registration
granted.
Immediately
following the
financial year in
which such
application is
made
Time period in
which order
shall be
passed
Within three
months,
respectively,
calculated from
the end of the
month in which
the application
was received
Within six
months,
respectively,
calculated from
the end of
the month in
which the
application was
received
Within six months,
respectively,
calculated from the
end of the month in
which the
application was
received
Within one
months,
respectively,
calculated from
the end of
the month in
which the
application was
received
Basis A Category B Category C Category D Category
Application
to be made
for 80G
Within three
months from the
Commencement
of the new
provisions i.e. 1st
June, 2020.
Atleast Six
months prior to
the expiry of the
registration.
Within Six Months
from the
commencement of
activities or six
months prior to the
expiry of provisional
registration,
whichever is earlier
Atleast one month
prior to the
commencement of
the previous year
relevant to the
assessment year for
which approval is
sought.
Key points to be noticed under new provisions —
➢ In case, if a charitable/religious trusts/ institution etc. get itself registered under Section
10(23C) or 10(46) then the registration under Section 12AB shall stand inoperative,
whereas if the charitable/religious trusts institution etc. apply again for registration under
Section 12AB then the registration under Section 10(23C) or 10(46) shall stand
inoperative.
❖ Application for registration under Section 12AB shall be made to the
Commissioner or Principle Commissioner of the Income tax.
➢Further, the process for getting registered under Section 12AA and Section 10(23C) is
same as discussed in the above table.
❖ Registration under Section 12AA shall stand inoperative w.e.f. June 01, 2020.
❖ For B and C category of trusts the Commissioner or Principle Commissioner of
Income tax shall reject the application in case, they are not satisfied with the
genuineness and compliances of the objects, after providing the reasonable
opportunity of being heard.
❖ In case of modification or alteration in the objects of the charitable/religious
trusts institution etc., the charitable/religious trusts institution etc. shall file the
application for registration with the modified and altered objects under the new
provisions of law within 30 days from the day of modification of objects.
All applications pending under Section 12AA before the Commissioner or Principle
Commissioner and for application for which no order has been passed, shall deemed to
be applications pending under Section 12AB.
➢ Further, in case where Commissioner or Principle Commissioner is satisfied that the
charitable/religious trusts institution etc. have not complied with the objects mentioned or
any other law, shall cancel the registration of charitable/religious trusts institution etc. after
providing the reasonable opportunity of being heard.
➢ Amendments under Section 80G
❖ The Charitable/religious trusts institution etc. shall file an application before the
Commissioner or Principle Commissioner within the prescribed time limits to sought
registration under Section 80G. Procedure and time limit to file an application for
registration under Section 80G is same as the procedure for registration under
Section 12AB.
❖ Further, the Charitable/religious trusts institution etc. shall file a statement of
receipts of donation to the prescribed Income tax authority in the prescribed time.
❖ Further, the charitable/religious trusts institution etc. shall furnish to the donor, a
certificate specifying theamount of donation in such manner, containing such
particulars and within such time from the date of receipt of donation, as may be
prescribed. Furthermore, the donor shall be provided the deduction under 80G
directly in the return of income on the basis of the prescribed statements
➢ Amendments under Section 80GGA
❖ Clause 34 of Finance bill, 2020 has specified that no deduction shall be allowed
to the donor under Section 80GGA in respect, of donation exceeding amount of
Rs.2,000/- unless donation is paid in any mode than cash.
➢Furnishing of Statements and Certificate
➢Charitable/religious trusts institution etc. shall furnish the following statements: –
❖Statement as prescribed under Section 35(1) to the prescribed Income tax
authority or furnishing certificate as prescribed under clause (ii) of Section 35(1A)
❖Statement for receipt of donation under Section 80G to the prescribed Income
tax authority or furnishing certificate as prescribed under clause (ix) of sub section
5 of Section 80G.
➢ In case of failure to file the above statements the Charitable/religious trusts institution
etc. shall be levied the fees of Rs.200/- for each day during which the failure continues.
Further, the Assessing office may levy penalty of amount not less than Rs.10,000/- which
may be extended to an amount of Rs.1,00,000/-.
➢ Amendment under Section 115TD
❖ After the introduction of Section 12AB, nothing contained in Section 12AA shall
be applicable to the trust or institution registered under Section 12AA. Hence in
order to make the provisions of Section 115TD applicable Clause 33 of the Finance
Bill, 2020 have substituted the word, figures and letters “under section 12AA” with
the words, figures and letters “under section 12AA or section 12AB” in Section
115TD which shall be effective from June 01,2020.
➢ Conclusion
❖ Amendments brought in by Finance Bill, 2020 will bring additional burden of
compliances for Charitable/religious trusts institution etc. but it will definitely lead to
greater and transparent monitoring of activities of charitable trusts. The aforesaid
amendments seem to be in the way to make the processes more transparent and
uncorrupted by use of digital means
How ever CBDT has extended or deferred the implementation of the new procedure
for approval/ registration/ notification of certain entities u/s 10(23C), 12AA, 35 &
80G of the Income Tax Act, 1961 to 1st October 2020 from prescribed June 1,
2020due to COVID 19 impact
HELEN DEEPTHI. B
SRO0568444
BLOCK CHAIN TECHNOLOGY
INTRODUCTION TO BLOCK CHAIN
Blockchain started its journey back in 1991. It was described by
Stuart Haber and W. Scott Stornetta in 1991. Their aim was to
design a system where document timestamps could not be
tampered. But they were failed to implement the system.
Blockchain technology has been garnering great
hype recently. It gained popularity after the
introduction of Bitcoin in 2009 by the person or
group of people by the pseudonym Satoshi
Nakamoto. Many people confuse and believe
blockchain to be bitcoin. But, bitcoin is one
application of the blockchain technology.WHAT IS A BLOCKCHAIN?
A blockchain is defined as a peer to peer distributed ledger forged by
consensus, combined with a system for smart contracts.
-Hyperledger, Linux Foundation
Now, that definition might contain a lot of uncommon terms so let’s start by breaking it into
parts and understanding each term.
Peer to Peer Network
You must be aware of BitTorrent and Tor. Both of these are built
on peer to peer network design. A peer to peer network is a
distributed application architecture that consists of computing
devices connected to each other, without a central server.
A ledger is a system containing all the records of an input and
output of a process. A distributed ledger is a data structure
which is spread across different computing devices. DLT
(Distributed Ledger Technology) is the technology that
distribute records across all the users.
Distributed Ledger
Consensus is a process of ensuring that all the
different users in a blockchain come to an
agreement regarding the current state of
blockchain. There are several consensus
mechanisms that are used by different
blockchains to achieve consensus.
Consensus
Smart Contracts
Forget smart contract and blockchain for a
moment. Think about contracts in general. These
contain some conditions which need to be fulfilled
in order for some transaction (example - money
exchange) to occur. For example, if you are selling
me a laptop, a contract will contain that I will be
responsible to pay you only if the laptop works properly. Similarly, smart contracts are
pre-requisite conditions which need to be fulfilled for transactions to happen in a
blockchain.
ADVANTAGES OF BLOCKCHAIN
The basic advantages of Blockchain technology are decentralization, immutability,
security, and transparency.
➢ It eliminates the need of a third party between two entities that are willing to exchange
something.
➢ It saves time as exchanges can be done without any outside interference.
➢ It saves money as it reduces overhead and cost of intermediaries
➢ It reduces risk of tampering, fraud and cyber crime due to its immutable nature.
➢ There is no need to trust a third party now as the records are stored in distributed
ledgers.
GENERATIONS OF BLOCK CHAIN
1st GENERATION BLOCKCHAIN- In 2008, SATOSHI NAMAKOTO released the white
paper of bitcoin. Bitcoin is a blockchain based peer to peer payment system. Gradually,
the bitcoin started to become a mode of payment on different shop around the world.
➢During the innovation of 1st generation blockchain, one of the biggest bank in the
world GOLDMAN SACS built its own blockchain.
➢A deal of $1 Billion was signed between the Australian Government and IBM.
➢The government of Dubai announces it will be the first blockchain powered
government in the world.
➢The first bitcoin exchange was set up in 2010. The bitcoin PIZZA GUY, LAZLO
HANYECZ, makes the first payment by paying 10,000 BTC for two pizzaz.
➢Due to inflation in bitcoin price, it was not suitable for payment in daily routine. As
time passes the new innovation were develop using blockchain technology. The
block chain of bitcoin is not scalable as the transaction speed was very low as 7
TPS and failed to work efficiently.
2ND GENERATION BLOCKCHAIN
➢Following the bitcoin, many other projects started their journey with block chain. In 2013,
a 19 years old boy VITALIK BUTERIN introduced the concept of smart contracts using
block chain technology.
➢The projects Ethereum gained global popularity as it provided the platform for
developing decentralised applications. Ethereum blockchain is known as 2ND
GENERATION BLOCK CHAIN. Ethereum provided the facility for the developer to
develop a decentralised application using standard ERC20 token.
➢Most of the projects listed on COINMARKETCAP are using ethereum platform. There is
a huge ethereum dapps list available in the open market aiming to provide the users with
the solution to real-world problems.
➢Despite popularity, ethereum blockchain is not up to mark. It has failed to provide the
problem to the scalability issue. The transaction speed of etherum block chain is 15TPS.
➢When we look at the transaction speed of VISA, it is 24000 TPS. To achieve this
transaction speed on a decentralised system, we need a more powerful block chain.
➢Bitcoin hits $1000 after a huge spike in price but instantly it falls back. China bans the
banks in the country from trading bitcoin due to anonymity.
➢In 2015, NASDAQ started a block chain trial to enhance speed, efficiency at a lower
cost. According to Accenture, in 2016 block chain attained the 13.5% adaption rate within
financial services. Google, Amazon, Microsoft and IBM joined together for testing block
chain service with clients.
3RD GENERATION BLOCKCHAIN
➢We are entering into a 3rd generation blockchain where Scalability, Interoperability,
Privacy are the goals to be achieved.
➢Different projects are trying to make the blockchain more powerful. Some of the leading
projects in 3rd generation block chain are Zilliqa, AION, Cardano, EOS, etc.,These
projects are using new concepts to make the blockchain more scalable.
➢Blockchain with sharing and side chain technology will be more powerful and scalable
with the intention that mainstream and governments around the world would adopt.
➢ The government of Pakistan has recently started a platform where people can learn
blockchain technology and get certifications. Similarly, universities are adding the block
chain to their curriculum.
➢ ALI BABA has introduced the block chain based project ALIPAY. But we have to wait for
the complete block chain adoption. And Facebook is also planning to launch its own
cryptocurrency. The world biggest block chain annual conference reaches 4000 attendees
in 2018. According to Forbes almost 15% of Financial Companies use block chain today.
TYPES OF BLOCKCHAIN
There are different types of blockchains possible in the ecosystem.
Public Blockchain
A public blockchain is also known as permission-less
blockchain. Here, everyone can be a part of this
blockchain and can participate by running as a node,
by mining a block or by making transactions in the
blockchain. Bitcoin and Litecoin are examples of
public blockchains.
Private Blockchain
A private blockchain is also known as permissioned
blockchain. Here, there are restrictions on the
participation as only selected individuals or member
of an organisation can be a part of the blockchain.
Multichain and Hyperledger projects (Fabric,
Sawtooth) are used to build private blockchain.
Consortium Blockchain
A consortium blockchain are said to be partially -
decentralised or semi - decentralised. It is controlled by
a group of organisations unlike one organisation as in
private blockchain. The member organisations has the
authority to participate by running as a full node, by
mining etc. R3 and EWF (Energy Web Foundation) are
examples of consortium blockchain.
CONCLUSION
Blockchain is a new name in the world of
technologies but it is definitely the one to last. Even
in the early stages, the technology has gained huge
popularity starting with their very first application of
cryptocurrencies.
They also need to be able to act as the bridge, having informed conversations with both
technologists and business stakeholders.
Accountants will not need to be engineers with
detailed knowledge of how blockchain works.
But they will need to know how to advise on
blockchain adoption and consider the impact of
blockchain on their businesses and clients.
