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Business News/ Politics / Policy/  Sitharaman to assess tax harassment charges, review CSR default penalty
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Sitharaman to assess tax harassment charges, review CSR default penalty

The Companies (Amendment) Bill 2019 proposes that any unspent annual CSR funds should be transferred to a specified government fund within six months of the financial year
  • To help small businesses, the government will expeditiously clear all their dues except in cases where there are disputes
  • Finance minister Nirmala Sitharaman with CII president designate Uday Kotak and CII director-general Chandrajit Banerjee during the CII National Council Meet, in New Delhi on Friday (PTI)Premium
    Finance minister Nirmala Sitharaman with CII president designate Uday Kotak and CII director-general Chandrajit Banerjee during the CII National Council Meet, in New Delhi on Friday (PTI)

    Finance Minister Nirmala Sitharaman will travel around the country to find out whether businesses are being harassed by tax officials, industry chamber Confederation of Indian Industry (CII) said in a statement quoting the minister after a closed-door interaction on Friday.

    The minister also assured businessmen that the controversial penal provision in the latest amendments to the Companies Act for defaults on corporate social responsibility (CSR) norms will be reviewed, the statement said.

    The Companies (Amendment) Bill 2019, which has been signed into law by the President on 31 July, proposes that any unspent annual CSR funds should be transferred to a specified government fund within six months of the financial year. In the case of ongoing CSR projects, businesses have three years to utilise the funds allocated in a given year. The Bill also proposed penal provisions that may include fine or imprisonment or both for defaulting officers.

    This would be the second legislative move to be reviewed by the NDA government within days of the amendment making its way through Parliament. The government is also examining pleas of foreign portfolio investors (FPIs) to review an increase in surcharge on their income tax outgo that is implemented through the Finance Act, 2019.

    "Sitharaman mentioned that she would review the provision on criminal penal provisions. She said CSR notices with retrospective effect ‘were unacceptable’ and she will put a stop to these notices," said the statement.

    CII said quoting Sitharaman that she will be travelling around the country, including to Tier II cities, to understand tax harassment faced by corporates. "In addition, a technology-driven platform will be set up wherein cases of harassment can be uploaded, with or without disclosing identity. Sitharaman stated her intent to address the issues relating to harassment and ensure powers are not misused," said the CII statement.

    The move coincides with criticism of the income tax department by industry executives following the recent death of Café Coffee Day founder V.G. Siddhartha. A letter, attributed to Sidhartha, claimed he was under pressure from a private equity investor and had faced harassment at the hands of a tax official, a charge that the tax department rejects.

    To help small businesses, the government will expeditiously clear all their dues except in cases where there are disputes, the industry chamber said. Delayed payment to MSMEs is estimated at around 48,000 crore.

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    ABOUT THE AUTHOR
    Gireesh Chandra Prasad
    Gireesh has over 22 years of experience in business journalism covering diverse aspects of the economy, including finance, taxation, energy, aviation, corporate and bankruptcy laws, accounting and auditing.
    Catch all the Politics News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
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    Published: 09 Aug 2019, 05:55 PM IST
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