Transactions in relation to which quoting PAN is Mandatory


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Transactions in relation to which quoting PAN is Mandatory 



The Income Tax Department prescribes a list of transactions for which quoting of Permanent Account Number (PAN) is mandatory. These are listed in Rule 114B of the Income Tax Rules, 1962 which were first inserted with effect from 1st November, 1998 and have been amended from time to time. The list under Rule 114B as on date requiring PAN to be quoted includes the following banking transactions :


·         Deposit with a banking company or a co-operative bank in cash exceeding fifty thousand rupees during any one day.
·         Purchase of bank drafts or pay orders or banker's cheques from a banking company or a co-operative bank in cash for an amount exceeding fifty thousand rupees during any one day.
·         A time deposit with a banking company or a co-operative bank or a Post Office
·         Opening an account [other than a time-deposit referred to above or a Jandhan / Basic Bank Deposit Account] with a banking company or a co-operative bank.

In addition to the existing requirement of quoting of PAN in respect of cash deposits in excess of Rupees fifty thousand in a day, quoting of PAN will now also be mandatory in respect of cash deposits aggregating to Rupees two lakh fifty thousand or more during the period 09th November, 2016 to 30th December, 2016 as per an amendment notified by CBDT on 15-11-2016.

The Department has already issued close to 25 crore PAN till date. The persons requiring a PAN for complying with the above requirement may do so by applying to the NSDL in a prescribed format with the necessary documentary proof. The link to the NSDL site  and the instructions for making the application are available on the official website of the Income-tax Department  www.incometaxindia.gov.in  under the ‘Important Links’ head  in  the lower left hand corner of the homepage.

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Exchange Rate of Foreign Currency Relating To Imported and Export Goods Notified

In exercise of the powers conferred by Section 14 of the Customs Act, 1962 (52 of 1962), and in supersession of the notification of the Central Board of Excise and Customs (CBEC) No.136/2016-CUSTOMS (N.T.), dated 3rd November, 2016, except as respects things done or omitted to be done before such supersession, the Central Board of Excise and Customs (CBEC) hereby determines that the rate of exchange of conversion of each of the foreign currencies specified in column (2) of each of Schedule I and  Schedule II annexed hereto, into Indian currency or vice versa, shall, with effect from 18th November, 2016, be the rate mentioned against it in the corresponding entry in column (3) thereof, for the purpose of the said section, relating to imported and export goods.

SCHEDULE-I

Sl.No.
Foreign Currency
Rate of exchange of one unit of foreign currency equivalent to Indian rupees
(1)    
(2)
(3)


               (a)
                (b)


(For Imported Goods)
  (For Export Goods)
1.
Australian Dollar
51.75
49.80
2.
Bahrain Dinar
186.55
174.15
3.
Canadian Dollar               
51.35
49.80
4.
Danish Kroner
9.95
9.60
5.
EURO
73.95
71.45
6.
Hong Kong Dollar
8.85
8.65
7.
Kuwait Dinar
231.00
216.20
8.
New Zealand Dollar
49.20
47.30
9.
Norwegian Kroner
8.15
7.90
10.
Pound Sterling
85.80
83.05
11.
Singapore Dollar
48.70
47.25
12.
South African Rand
4.90
4.60
13.
Saudi Arabian Riyal
18.70
17.55
14.
Swedish Kroner
7.55
7.25
15.
Swiss Franc
68.95
66.60
16.
UAE Dirham
19.10
17.90
17.
US Dollar
68.80
67.10
18.

Chinese Yuan
10.05
9.75

SCHEDULE-II

Sl.No.
Foreign Currency
Rate of exchange of 100 units of foreign currency equivalent to Indian rupees
(1)    
(2)
(3)


(a)
(b)


(For Imported Goods)
  (For Export Goods)
1.
Japanese Yen
63.40
61.30
2.
Kenya Shilling
68.95
64.50

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The Central Government takes several decisions to facilitate farmers, small traders, Group ‘C’ Employees of Central Government including equivalent levels in the Defence and Para Military Forces, Railways and Central Public Sector Enterprises in the aftermath of the cancellation of the legal tender character of the old Rs. 500 and Rs. 1000 notes;
Also decides to reduce the limit of exchange of old Rs. 500/- and Rs. 1000/- notes across the counter in banks from Rs. 4500/- to Rs. 2000/-with effect from 18th November, 2016.

In the aftermath of the cancellation of the legal tender character of the old Rs. 500 and Rs. 1000 notes, the Government of India has been receiving several suggestions including those from the State Governments. The Government has considered various suggestions and the following decisions relating to certain operational aspects of this scheme have been taken:

i. We are now at the beginning of the Rabi season. The farmers need various inputs for their agricultural activities. While the Government is keen on promoting payment through the banking or digital system, it is felt necessary to make some quantum of cash available with farmers to meet various expenses in connection with agricultural operations. It has, therefore, been decided that farmers would be permitted to draw upto Rs. 25000/- per week in cash from their KYC compliant accounts only. These cash withdrawals would be subject to the normal loan limits and conditions. This facility will also apply to the Kisan Credit Cards (KCC).

ii. Farmers are currently selling their produce from the Kharif season in the APMC markets/mandis. The farmers who receive such payments in their bank accounts through cheque/ RTGS will be permitted to draw up to Rs. 25000/- per week in cash. These accounts will have to be KYC compliant. This facility will enable the farmers to meet their various expenses connected with agriculture. This will also infuse lot of liquidity into the rural sector.

iii. Traders registered with APMC markets/mandis will be permitted to draw up to Rs. 50,000/- per week in cash from their KYC compliant accounts as in the case of business entities. This will enable these traders to pay wages and facilitate easy loading, unloading and other activities at the mandis.

iv. For payment of crop insurance premium, States fix time limits depending on their local requirements and conditions. Consequently, the last date for payment expires on different dates. It has now been decided to extend the last date for payment of crop insurance premium by 15 days.

v. While encouraging families to incur wedding expenses through cheques or digital means, it has been decided to permit families celebrating weddings to draw up to Rs. 2,50,000/- in cash from their own bank accounts. These accounts have to be necessarily KYC compliant. The amounts can be drawn only by either of the parents or the person getting married. Only one of them will be permitted to draw this amount. This limit of Rs. 2,50,000/- will apply separately to the girl’s family and the boy’s family. The person drawing such amount has to furnish the PAN details. Further, a self-declaration will have to be submitted by the person to the effect that only one person from his/her family is drawing the amount. It is expected that members of the public will fully cooperate to ensure that the above guidelines are adhered to. Any misuse of this facility will invite appropriate action based on the self-declaration and other details.

vi. At present, over the counter exchange of old Rs. 500/- and Rs. 1000/- notes is limited up to maximum of Rs. 4500/- per person. Reports have been received that the same persons are going back to the counter again and again, thereby cornering the facility and depriving many other people from exchanging old notes. There are also reports of organized groups indulging in such practices to convert their black money into white. It is now expected and desirable that people put their old notes into their bank accounts. However, for convenience of the people who may be on temporary visit either for work or otherwise, it has been decided to reduce this limit of exchange of old Rs. 500/- and Rs. 1000/- notes across the counter in banks from Rs. 4500/- to Rs. 2000/-. This facility will be available only once per person. The reduced limit of Rs. 2000/- will take effect from 18th November, 2016.

vii. Central Government employees up to Group `C’ including equivalent levels in the Defence and Para Military Forces, Railways and Central Public Sector Enterprises will be given an option to draw salary advance up to Rs. 10,000/- in cash. This amount will be adjusted in their salary for November, 2016. It is expected that this decision will ease the pressure on the banks.

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India–USA Bilateral Competent Authority MAP/APA Meeting – Resolution of more than 100 cases under MAP and Agreement on terms and conditions of First ever Bilateral APA involving India and USA

The Bilateral Competent Authority Mutual Agreement Procedure (MAP) / Advance Pricing Agreement (APA) meeting between India and USA was held in Washington DC, USA during the last week of October, 2016. The discussions in the meeting were focussed on resolving MAP cases pending for a long time and to achieve significant developments in Bilateral APA Process.

During the meeting, 66 MAP cases relating to Transfer Pricing issues and 42 MAP cases relating to Treaty Interpretation issues were agreed to be resolved successfully. The total amount that was locked-up in dispute in these cases is approximately Rs.5,000 crore and these cases were related to Assessment Years ranging from AY 1999-2000 to AY 2011-12. The resolved cases pertain to various issues like transfer pricing adjustments made to the international transactions in the nature of Payment of Royalty, Payment of Management Fees, Cost Contribution Arrangements, Engineering Design Services, Contract R&D Services, Investment Advisory Services, Marketing Support Services, Software Development Services, IT enabled Services (both BPO and KPO services) etc. and treaty interpretative issues in the nature of Presence of Permanent Establishment (PE) in India and Profit Attribution to such PEs, disputes pertaining to royalty income v/s business income of foreign companies, etc.

Further, during the meeting, the two Competent Authorities reached an agreement on the terms and conditions of the first ever Bilateral APA involving India and USA. Though India started its Bilateral APA process with the USA by accepting applications from the Indian taxpayers from FY 2012-13, the USA started its Bilateral Process with India only in February 2016 by way of accepting applications from US taxpayers. Within a short span of 8 months, the Agreement has been reached upon in the first ever Bilateral APA involving India and USA.

The speedy resolution of cases and agreement on Bilateral APA due to effective mechanism of development of mutual trust and cooperation between the Competent Authorities of two countries would really be a positive factor in creating a conducive atmosphere for investments and business by US Companies in India.

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