PAN card requirement be extended to all gold transactions-Household Finance Committee

PAN card requirement be extended to all gold transactions, daily cash limits against gold sale, electronic registry etc. suggests Household Finance Committee

PAN card requirement be extended to all gold transactions

RBI has released the report of the Household Finance Committee. The Household Finance Committee was set up to look at various facets of household finance in India.

The Committee was chaired by Dr. Tarun Ramadorai, Professor of Financial Economics, Imperial college London, with representation from all the financial sector regulators, namely, Reserve Bank of India (RBI), Securities and Exchange Board of India (SEBI), the Insurance Regulatory and Development Authority of India (IRDAI) and Pension Fund Regulatory and Development Authority (PFRDA).

The committee has Highlighted the unique aspects of Indian households’ financial decision-making. It has also set out several recommendations on enabling better participation by Indian households in formal financial markets, including a Regulatory Sandbox for assessing the role of new financial technologies and products.

As per the report of the household committee, the average Indian household holds 84% of its wealth in real estate and other physical goods, 11% in gold and the residual 5% in financial assets. Whereas retirement accounts play a very limited role in household balance sheets, even at the top of the wealth distribution.

The committee has noted that gold is a preferred asset for tax evasion purposes. To curb it, the committee has proposed as under:

(a) The PAN card requirement for gold transactions from jewellers be extended to all transactions, and not just those that are above Rs. 2,00,000

(b) The daily cash limits against the sale of gold.  However the committee has cautioned that taking a holistic perspective on household balance sheets that these cash limits should be complemented with measures to ensure that unsecured credit is widely available to households at favourable rates in the event of emergencies.

(c) To prevent PAN requirement driving gold transactions underground, all gold transactions should be registered using an electronic registry such as a depository.

(d) A more incisive use of income tax data required to detect tax avoidance, and

(e) Enforcement of tax avoidance should be strict.

Classification and GST rate on lottery tickets-goods or services. CBEC Circular

Classification and GST rate on lottery tickets-goods or services

Classification and GST rate on lottery tickets-goods or services

Circular No.06/06/2017-CGST

F. No. 354/149/2017-TRU
Government of India
Ministry of Finance
Department of Revenue
Tax Research Unit

New Delhi, the 27th August, 2017

The Principal Chief Commissioner/Chief Commissioners/ Principal Commissioner/
Commissioner of Central Tax (All) / Director General of Systems


Subject: – Issue related to classification and GST rate on lottery tickets – regarding

Supply of lottery has been treated as supply of goods under the Central Goods and Services Tax (CGST) Act, 2017.

2. Accordingly, based on the recommendation of the GST Council, the GST rate for supply of lottery has been notified under relevant GST rate notification relating to CGST/IGST/UTGST/SGST. However, entries in the respective notifications mention classification for lottery as “-”.

3. In this connection, references have been received, inter-alia, stating that due to discrepancy in code allotted, i.e., lottery is defined as goods but code allotted for lottery is under services, the assessees are not able to upload return or deposit tax in time.

4. The matter has been examined. It should be noted that the process of filing return is linked with rate of tax specified for supply. Further, there is complete clarity about rate of tax on lotteries. As mentioned above, in GST, lottery is goods and the classification indicated in relevant notification for lottery is “-”, which means any chapter.

5. That being so, it is clarified that the classification for lottery in respective CGST, IGST, UTGST and SGST notifications shall be ‘Any Chapter’ of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) and tax on lottery should be paid accordingly at prescribed rates, 12% or 28%, as the case may be.

(Ruchi Bisht)
Under Secretary (TRU)

Total GST revenue collected upto 29th August 2017 is Rs 92283 crore

Total GST revenue collected upto 29th August 2017 is Rs 92283 crore.  CGST Rs 14894 crore, SGST is Rs 22722 crore, IGST revenue is Rs 47469 crore

 GST revenue

Press Information Bureau 
Government of India
Ministry of Finance

29-August-2017 18:58 IST

GST Revenue Figures – July 2017 

The Goods and Services Tax (GST) tax was introduced on 1st of July, 2017.  The last date for payment of GST for the month of July 2017 was 25th August, 2017.  The last date for filing returns in cases, where the taxpayer wanted to avail transitional credit was 28th August, 2017 and, in all other cases, it was 25th August, 2017. 

If we exclude the taxpayers who have registered with the GSTN in August 2017 and the composition dealers, total number of tax payers who were required to file the returns for July 2017 is 59.57 lakhs, of which, as on 29th August, 2017 (10 a.m.), 38.38 lakh returns have been filed, which is 64.42% of the total number of returns, which are to be filed for the month of July 2017. 

The total revenue of GST paid under different heads upto 29th August, 2017 (10 a.m) is Rs.92,283 crore.  The total CGST revenue is Rs.14,894 crore, SGST revenue is Rs.22,722 crore, IGST revenue is Rs.47,469 crore (of which IGST from imports is Rs.20,964 crore) and Cess is Rs.7,198 crore (of which Rs.599 crore is Compensation Cess from imports). 

It may be mentioned that IGST will be allocated between the CGST and the SGST to the extent that the same is used for payment of CGST/SGST.  This exercise will be done based on the cross-utilisation report to be received from the GSTN.  Exact revenue figures of the Central and the State Governments respectively will be known after this exercise is complete before the end of this month.

Out of total 72.33 lakh taxpayers, 58.53 lakh taxpayers have completely migrated to the GSTN and 13.80 lakhtaxpayers are yet to complete their procedural formalities to migrate to the GSTN.  The number of new taxpayers who have registered with the GSTN upto 29th August, 2017 (10 a.m.) is 18.83 lakhs.



Book entry transfer of share application money to capital reserve account not benefit u/s 28(iv) – ITAT

Book entry transfer of share application money to capital reserve account could not be regarded as benefit or perquisite arising in course of business u/s.28(iv) – ITAT

 Book entry transfer

Book entry transfer of share application money to capital reserve 

ABCAUS Case Law Citation:
ABCAUS 2047 (2017) (08) ITAT

The Grievance:
The present appeal was preferred by the Revenue against the order of the Commissioner of Income Tax (Appeals) [CIT(A)] deleting 

Assessment Year :  2012-13

Brief Facts of the Case:

The assessee company was engaged in the business of investment in shares, properties and finance related activities. The Assessing Officer (AO) perused the balance sheet filed by the assessee and observed that the assessee, during the relevant year, had transferred Rs.44,25,000/- from the Share application money account to Capital reserve account.

During the course of assessment proceeding, assessee filed written submissions stating that the share application money of Rs.44,25,000/- was received from one private limited company during Financial Year 2004-05 through banking channel and the assessee, during the year, had merely passed a Journal book entry on transferring the share application money account to Capital Reserve account.

The AO was not convinced with the submissions of the assessee and made the addition u/s.28(iv) of the Income Tax Act, 1961 (the Act) holding that the benefit had arisen in the business of the assessee. The findings of the AO were as under:

(a) There was no evidence on record that the amount was received from the said private limited company in FY 2004-05.

(b) There was no evidence that the amount was towards share application money

(c) There was no evidence that the amount was forfeited due to non performance of action on the part of company giving the share application money

(d) Mere transfer of amount to capital reserve account did not ipso facto absolved the assessee from its onus to explain the transaction with corresponding evidences.

(e) When the amount was transferred to capital reserve account, it had resulted in benefit arising from the business carried out by it.

(f) Therefore the amount was squarely taxable u/s. 28(iv) of the Act

Matter carried to the CIT(A) and he deleted the addition made observing that the assessee had merely passed a book entry by transferring the share application account to Capital reserve account and as the share capital/premium was in nature of capital field, it could not be regarded that any benefit or perquisite had arisen to the appellant in course of business u/s.28(iv) of the Act.

Observations made by the Tribunal:

The ITAT observed that the controversy is covered by the decision of Hon’ble Supreme Court wherein it was held that the amount on account of share capital received from the various shareholders ought not to have been treated as business income.

It was also noted that similar issue had been decided by the Tribunal in another case.

It was held that CIT(A) was justified in deleting the addition

Book entry transfer
Download Full Judgment

Electronic Sealing of containers by exporters under self-sealing procedure prescribed by CBEC

Electronic Sealing of  containers by exporters under self-sealing procedure prescribed by CBEC


Circular No. 36/2017-Customs

F. No: 450/08/2015-Cus.IV
Government of India
Ministry of Finance
Department of Revenue
(Central Board of Excise and Customs)

Room No.227-B, North Block,
New Delhi, 28th August, 2017

All Principal Chief Commissioner/Chief Commissioner of Customs & Central Excise
All Principal Commissioner/Commissioner of Customs & Central Excise
All Principal Chief Commissioner/Chief Commissioner of Customs/Customs (Preventive)
All Principal Commissioner/Commissioner of Customs / Customs (Preventive

Subject: Implementing Electronic Sealing for Containers by exporters under self-sealing procedure prescribed vide circular 26/2017-Customs dated I” July 2017-reg.

In continuation of the Board circular 26/2017 -Customs dated 1.7.2017 regarding self-sealing of containers by exporters using electronic seals, the Board has approved the following procedure which shall be adhered to by exporters opting for self-sealing.

2. Procedure

(a) The exporters who were availing sealing at their factory premises under the system of supervised factory stuffing, will be automatically entitled for self-sealing procedure. All exporter AEOs will also be eligible for self-sealing. It is clarified that all those exporters who are already operating under the self-sealing procedure need not approach the jurisdiction Customs authorities for the self-sealing permission.

(b) The permission to self-seal the export goods from a particular premise, under the revised procedure, once granted shall be valid unless withdrawn by the jurisdictional Principal Commissioner or Commissioner of Customs if non-compliance to law, rules and regulations is noticed. In case the exporter makes a request for a change in the approved premise (s), then the procedure prescribed in circular 26/20 17-Cus shall be followed, and a fresh permission granted before commencement of self-sealing at the new premises.

(c) With respect to para 9 (v) of the circular 26/20l7-cus, Principal Commissioners / Commissioners would be required to communicate to Risk Management Division (RMD) of CBEC, the IEC (Importer Exporter Code) of the following class of exporters:

(i) exporters newly granted permission for self-sealing;
(ii) exporters who were already operating under self-sealing procedure;
(iii) exporters who were permitted factory stuffing facility; and
(iv) AEOs

The categories mentioned in c(ii), (iii) and (iv) may be communicated to RMD by 20-09-2017 .

(d) Under the new procedure, the exporter will be obligated to declare the physical serial number of the e-seal at the time of filing the online integrated shipping bill or in the case of manual shipping bill before the container is dispatched for the designated port/ICD/LCS.

(e) Exporters shall directly procure RFID seals from vendors, conforming to the standard specification mentioned in para 3 below. Since the procedure seeks to enhance integrity of transportation of goods, the exporters will be required to obtain seals directly. They shall provide details such as IEC etc., at the time of purchase for identification as well as for using the standard web application necessary to support an RFlD self-sealing ecosystem.

(f) In case, the RFID seals of the containers are found to be tampered with, then mandatory examination would be carried out by the Customs authorities.

3. Standard Specification of the Seal:

(a) The electronic seal referred to in Para 9 (vii) of the Circular No. 26/2017-Customs dated 01.07.2017 shall be an “RFID tamper proof one-time-bolt seal”, each bearing a unique serial number. The exporters shall be responsible for procuring the seals at their own cost for use in self-sealing.

(b) Each seal shall be a one-time-bolt-seal bearing a unique serial number and brand of the vendor in the format ABCD XXXX XXXX, where ABCD stands for the brand of the vendor and X (8 digit) is a numerical digit from 0-9.

(c) The RFID seal shall conform to ISO 17712:2013 (H) and ISO/IEC 18000-6 Class 1 Gen 2 which is globally accepted in industrial applications and can be read with the use of UHF (i.e. 860 MHz to 960 MHz) Reader-Scanners.

(d) The manufacturer or vendor, as the case may be, shall be in possession of certifications requireda for conformance of the ISO standard ISO 17712:2013 (H) namely, clauses 4, 5 and 6. Before commencement of sales, the vendor shall submit self-certified copies of the above certifications to the Risk Management Division (RMD) and all the ICDs/ Ports where he intends to operate along with the unique series of the seals proposed to be offered for sale.

4.  Application, Record Keeping and Data Retrieval System

(a) It is clarified that the information sought from the exporter in para 9 (vii) of the circular 26/2017- Customs shall now be read as:

IEC (Importer Exporter Code)
Shipping Bill Number
Shipping Bill Date
e-seal number
Date of sealing
Time of sealing
Destination Customs Station for export
Container Number
Trailer- Truck Number

It is further clarified that the information need not be mounted “in the electronic seal”but tagged to the seal using a ‘web / mobile application’ to be provided by the vendor of the RFID seals. Data once uploaded by the exporter should not be capable of being overwritten or edited.

(b) All vendors will be required to transmit information in para (a) above to RMD and the respective destination ports / ICDs of export declared by the exporter. The arrangements for transmission of data may be worked out in consultation with the RMD and nodal Customs officer at each ICD / Port.

(c) All vendors shall be required to make arrangements for reading / scanning of RFID one- timeBolt seals at the Customs ports/ rCDs at their own cost, whether through handheld readers or fixed readers. (d) The integrity of the RFID seal would be verified by the Customs officer at the port /ICD by using the reader-scanners which are connected to Data Retrieval System of the vendor.

(e) Since all K’Ds / ports where containerized cargo is handled would require reader scanners, Principal Commissioners or Commissioners exercising administrative control over such ports/ ICDs shall notify the details of the nodal officers for the smooth operation ofthis system.

(f) The transaction history of the self-sealing should be visible to the exporters for their reference.

(g) The vendor shall also undertake to integrate the information stored on the data retrieval server with ICEGA TE at his own cost on a date and manner to be specified by the Directorate General of Systems, New Delhi.

5. The new self-sealing procedure shall come into effect from 1.1 0.20 17. Till then the existing procedure shall continue. All field formations are advised to immediately notify an officer of the rank of Superintendent to act as the nodal officer for the self-sealing procedure. He shall be responsible for coordination of the arrangements for installation of reader-scanners, whether fixed or hand-held.

6. Difficulties anticipated/concerns, if any, should be brought to the notice of the Board immediately.

7. Hindi version follows.

Yours faithfully

(Zubair RlazY Director(Customs)