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Norms relaxed for scrutiny of company tax returns

Norms relaxed for scrutiny of company tax returns
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First Published: Sun, Jul 27 2008. 10 17 PM IST

Giving incentive: Finance minister P. Chidambaram. The move to ease scrutiny?norms for firms is aimed at encouraging tax?compliance
Giving incentive: Finance minister P. Chidambaram. The move to ease scrutiny?norms for firms is aimed at encouraging tax?compliance
Updated: Sun, Jul 27 2008. 10 17 PM IST
New Delhi: In what could be a major relief to the corporate sector, the Central Board of Direct Taxes (CBDT) has decided not to scrutinize tax returns of more than 1,000 top companies provided no serious disputes are pending against them.
Giving incentive: Finance minister P. Chidambaram. The move to ease scrutiny?norms for firms is aimed at encouraging tax?compliance
“The annual returns of tax complying companies would not be scrutinized this year. The decision has been taken by the CBDT to encourage better tax compliance among the corporate,” a senior finance ministry official, who did not wish to be identified, said.
Last year, CBDT scrutinized tax returns of about 200 ‘A’ group companies listed on the Bombay Stock Exchange, 500 National Stock Exchange companies and all non-banking finance companies. The tax returns of all the banks and public sector units were also checked.
The decision to relax scrutiny norms follows an announcement by finance minister P. Chidambaram after the annual meeting of chief commissioners of income tax. Chidambaram had then said that the government would ensure that tax complying taxpayers are not harassed by the income-tax (I-T) department.
When a firm or individual is under scrutiny, the assessing officer issues notice to the taxpayer within a year of filing the return and investigates any tax evasion by verifying claims about tax exemptions, amount in bank accounts, cash reserves, details of loans, gifts and credit cards.
Under the new rule, if the I-T department has not raised tax demand of Rs10 lakh or more in addition to the deposited tax, and if it has not won any tax suit against the firm, the I-T officers would not open returns for scrutiny. But the department may consider to open tax returns of companies if they infused fresh capital of Rs50 lakh or more during last fiscal or filed for tax exemptions for the first time under any scheme.
In 2007-08, the department scrutinized about 320,000 tax returns, including about 51,000 filed by corporates. This resulted in an additional tax demand of Rs73,200 crore.
Canon eyes 40% rise in India revenue to Rs700 cr
New Delhi: With digital camera and copier sales set to boom in India, Japaneses imaging company Canon Inc. said on Sunday it expects its revenue from the country to surge this year,
“Canon intends to achieve a 40% increase in revenue by the end of this year at Rs700 crore,” Canon India president and chief executive officer Kensaku Konishi said, adding the company is counting on higher camera sales. Canon makes printers, cameras and camcorders, computer peripherals and copiers.
The company reported 38% growth in 2007 to a turnover of Rs510 crore.
It expects 30% of its revenue to come from the sales of cameras, 20% from printer and computer peripherals, 10% from software services and 40% from copiers.
To boost its business, Canon had already set up four exclusive retail outlets for the consumer and business segment with an investment of Rs8 crore.
“This is a new concept and the first of its kind in India: the first showroom was set up in Gurgaon. We will come up with another two stores in Mumbai by the end of this year,” Konishi said.
Canon had opened two retail showrooms in south India named Image Lounge offering a wide range of products such as printers, camera, camcoders, scanners, projectors and all-in-one printers.
To cater to companies, Canon has launched a ‘Business Solutions Lounge’ showroom. This would offer products such as multi-functional devices, large-format graphic machines, scanners and colour networked copiers. PTI
Vijaya Bank reports Rs77 crore Q1 loss
Bangalore: Bangalore-based Vijaya Bank reported a net loss of Rs76.64 crore in the first quarter on provisions of Rs190 crore for depreciating mark-to-market instruments and investments. The bank had posted a profit of Rs111.35 crore in the same period last year.
Mark-to-market is an accounting practice of valuing an investment in line with its current market price. “But for the additional provision, the bank’s net profit would have been Rs114 crore, higher than the profit posted in the corresponding quarter last year,” said Prakas P. Mallya, chairman and managing director.
Of the total provisions of Rs190 crore, Rs23 crore have been earmarked for covering losses in equity investments, while the remaining Rs167 crore are for bonds and mutual funds investments.
Mallya, who is due to retire from his post by end-July, said the next quarter will have better results as a turnaround is expected in the markets, along with moderation in inflation.
For the first quarter ended June, Vijaya Bank’s net interest margins were down to 1.87% from 3.1%, while the operating profit fell to Rs154.84 crore from Rs171.27 crore on dull business.
The total business rose 32.9% to Rs85,174 crore. The bank expects to record total business of Rs1 trillion by March 2009. Deepti Chaudhary
Former CACP chairman to join farmers’ protest
Chandigarh: Former chairman of the Commission for Agricultural Costs and Prices, T. Haque, who has been critical of the Union government’s decision to reduce the minimum support price (MSP) of paddy, is now taking to the streets to voice his anger.
Haque will be joining a protest being organized by the Bharti Kissan Union (BKU), a farmers’ organization. The protesters plan to besiege Parliament in New Delhi on 4 August.
Farmers under the banner of BKU are protesting against the low MSP of paddy and incomplete farm loan waiver for farmers. They are also seeking reservation in educational institutions on the basis of economic criterion rather than on caste. Bajinder Pal Singh
Luxury manufacturing ‘could grow to $500 mn’
New Delhi: The manufacturing of luxury products in India has the potential to grow into a $500 million (Rs2,110 crore) industry, according to a report prepared by the Federation of Indian Chambers of Commerce and Industry and Yes Bank Ltd. The report, due to be released on Monday, says this is possible as global brands, such as Louis Vuitton and Frette, are looking at India as a manufacturing hub for their products, while others are sourcing their requirements from the country. The cost advantages, particularly in labour-intensive sectors such as leather and accessories will also influence the production of foreign luxury brands in india, it adds. Shabana Hussain
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First Published: Sun, Jul 27 2008. 10 17 PM IST
More Topics: Canon | India | Revenue | Tax Returns | Vijaya Bank |