Uncategorized Archives - Business , Financial & Legal Consultant In India

October 6, 2023October 6, 2023

Knowing the Power of Ayush: Your Guide to Ayush License in Healthcare

The AYUSH license Registration provides legal authentication for regulating the operational management systemization of Ayurvedic medicine in a structured manner. Ayurveda, Yoga, Naturopathy, Unani, Siddha, and Homeopathy are all things considered known as AYUSH. For many years, ayurveda has been recognized as one of the most effective approaches to providing a strict regulatory environment for pharmaceuticals. It is a procedure for bolstering the norms of inherent human health and improving the efficiency of the interconnected mechanisms of mental state. The Ayurvedic medical system’s quality criteria are established by AYUSH Licence so that it can function properly. Additionally, this license guarantees the validity of an upbeat viewpoint when emphasizing the need for a well-defined Ayurvedic firm. You will find comprehensive information on the AYUSH Licence in this blog post.

AYUSH Certificate

Anyone wishing to open a storefront selling Ayurvedic, Unani, Siddha, or other closely related products must first obtain an AYUSH license from the Indian government. Such permits are granted by the Ministry of AYUSH. India has been using Ayurveda, the oldest medical system in the world, for millions of years. Since it has no adverse effects, its use is expanding dramatically, and several countries are currently importing it.

Things to Take into Account When Applying for an AYUSH Licence in India

Any individual or company cannot launch or run a medical or cosmetic business without first obtaining the required licenses.
Allopathic, homeopathic, ayurvedic, herbal, and Unani remedies are safeguarded by the Drug & Cosmetic Act of 1940’s laws when they are sold as drugs.
A license from the Ministry of AYUSH is required in order to start manufacturing Ayurvedic drugs.

Benefits of Ayush Licence Registration

Having an AYUSH license has a number of benefits:

After acquiring an AYUSH Licence, a person or organization can work regardless of where the manufacturing company is based.
The individual or organization that applied for the AYUSH Licence is only responsible for the marketing of the product; the manufacturing company is in charge of all other required compliance.
Perks offered by the health insurance program to AYUSH license holders.
The use of Ayurvedic and herbal treatments is most prevalent in Indian culture, and in order to regulate and prevent the inappropriate use of Ayurvedic remedies, an AYUSH Licence is necessary.

Various AYUSH Licence Types

The following production licenses are issued by the Ministry of AYUSH:

License for AYUSH Manufacturing

When an application wishes to be awarded a license, it must have a plan in place for manufacturing and selling both products. A condition like this must be created for the manufacturer’s manufacturing plant.

Each state has its own set of laws governing the construction of such manufacturing facilities. Everyone must abide by the requirements set forth by the AYUSH state agency.

Requirements for an AYUSH Manufacturing Licence under the AYUSH Act:

Unit Position
Unit Size Requirement
Inspection for GMP Accreditation
Team Details
Loan agreement to create a product

The manufacturing plant must be situated in an industrial area.
For the production of just one medicine, a minimum manufacturing land size of 1200 square feet is required.
It will eventually add more categories if you plan to create many medications because you will require more space.
The manufacturing plant needs to be GMP-certified in order to run.
Ensure the presence of two pharmacies and two Ayurvedic practitioners.
You have access to all of the production and packaging machinery.
The drug inspector will regularly inspect your manufacturing facilities.

Unani Manufacturing License

It is believed that Unani Medicine is both an art and a science of healing. The noble profession of healing the suffering of humanity. The Unani framework is well-liked by people due to its distinctive approach to disease prevention and treatment. It has received general acceptance as one of the important medicinal systems.

Siddha’s Manufacturing Licence

The aim of therapy is to maintain the balance of the mind, body, and spirit. The Siddha technique gives equal weight to the body, mind, and spirit in an effort to restore perfect harmony to all bodily psychological, and physiological processes. Yoga is a crucial part of Ayurvedic therapy, along with meditation, diet, and lifestyle adjustments.

AYUSH License’s Essential Documentation

In order to receive an AYUSH Licence, the following documents are necessary:

Contact information including name, address, and phone
An exact copy of the manufacturing license,
A list of all items for which COPPs have been requested, together with a description of each product’s makeup,
Layout of the manufacturing facility and the site master file
“Incorporate the creation cycle and the assembling equation in your accommodation.”
Report on the Finished Product Specification, Method of Analysis Report, and List of Approved Products
Stability study analysis for each batch, detailing the production and expiration dates, the research’s terms, the drug’s name, and a validation report for three batches,
A list of the technical staff, including their qualifications, experience, and level of approval
A list of the instruments and equipment that will be used,
Schematics of the HVAC, water, and electrical systems
Export data for the previous two years, when it is acceptable to revalidate the COPP, as well as a demonstration of safety and efficacy as outlined in Rule 158B of the Drugs & Cosmetic Rules, 1945.
An examination of the goods submitted for WHO-COPPs (implied in the case of herbal products) to determine whether any non-herbal components, such as metals, minerals, etc., were present.
Drug and Cosmetics Act, 1940 and its implementing rules, Drugs & Magic Remedies (Objectionable Advertisements) Act, 1954 and its implementing rules, and the undertaking relating to compliance with domestic regulatory provisions (implied in the case of herbal goods) are all examples of laws that regulate the sale of drugs and cosmetics.

Process in Steps for Obtaining an AYUSH Licence

Every manufacturer who works with herbal or ayurvedic products is required to obtain a license from the Ministry of AYUSH. There is a specific AYUSH webpage for each state. To obtain the license, a candidate must visit the AYUSH website for their state.

The following assignments must be finished in order to earn the license:

Gain access to the website: Go to the state-specific AYUSH website to download the application for an AYUSH license. The applicant must also provide the necessary GMP and COPP affidavits.
Form submission: The following step is to complete the application form and send it, along with the required supporting materials, to the commissioner of the AYUSH Department for approval.
Obtaining the Commissioner’s approval: The commissioner will provide his approval within fifteen days of gaining his satisfaction.
Getting a license: The applicant will receive the AYUSH license by postal mail.

Conclusion

The aforementioned content presents an unmistakable image of the AYUSH Licence in an orderly manner. AYUSH Licence effectively connects the Ayurvedic structural model with the optimum legal structure. To ensure a smooth and effective system of medication without any foreseeable legal difficulties, it is essential for every owner of an ayurvedic medication structural framework to obtain a Licence.

January 3, 2023January 3, 2023

Know all about Public Limited Company Registration in India

Public limited company Registration is the structure for those business people who maintain that should carry on with work for enormous scope. This organization appreciates many honors with additionally the element of restricted responsibility. There are numerous guidelines and compliances of the Public authority to begin any Private Limited Company. This organization can raise capital from general society by the issuance of offers.

Public Limited Company Registration in India can be started with at least three Directors who are people (up to 15 Directors without Exceptional Goals), and seven supporters (investors) who might be People or corporate substances. Both, the Directors include sorters who might be similar individuals. The Companies Act 2013 draws no base capital line, so the base capital could be Re 1 for every investor. A Public Limited Company has highlights like separate lawful element which empowers it to be unmistakable from its individuals and Directors. The individuals hold a restricted risk in the organization and can’t be held obligated past the offers held by them.

Public Limited Company Registration Online is started principally if the investors/financial backers are enormous in number. The portions of a public restricted organization can be moved easily and guarantee a reasonable construction for raising capital. Before starting enrollment in a public Company, one should know about additional severe administrative necessities when contrasted with other corporate element structures.

Benefits of Public Ltd Company in India

Here are the Benefits given to the Public Ltd Company in India

Restricted liabilities for the investors of the Company
Unending Progression
Worked on the capital of the organization
Acquiring Limit
Fewer Risks
Better open doors for the development and extension of the organization

What all Documents are Required for Public Limited Company Registration Online in India?

The list of Documents Required for Public Limited Company Registration Online are:

Identity Proof such as Aadhar card, PAN card, Driving License, and Voter Id of all the designated directors and shareholders.
Address Proof of all the proposed directors and shareholders of the company.
PAN card details of all the directors and shareholders
Utility bills such as telephone, gas, water, or electricity bill of the registered office as residential proof of the business place. It should not be older than 2 months.
A NOC or No Objection Certificate from the landlord of the business place.
DSC or Digital Signature Certificate of the designated directors
Memorandum of Association (MOA) and Article of Association (AOA)

What are the minimum Requirements for a Public Limited Company Registration Online?

Minimum Requirements for a Public Limited Company Registration Online

Minimum 7 shareholders
At least 3 directors
At least one resident director
A registered business/office address
A unique and valid name for the company
Some amount of paid-up capital

What is the process of Public Limited Company Registration in India?

The Process of Public Limited Company Registration in India Includes the:

Digital Signature Certificate (DSC)- Since the registration procedure of a company is entirely online, a digital signature will be required for filing the forms on the MCA portal. For all proposed directors as well as the subscribers of the memorandum and articles of association, DSC is compulsory.
Director Identification Number (DIN)-It is an identification number concerning a director; it has to be procured by anyone who intends to become a director in a company. The DIN of a proposed director in addition to the name and address proof has to be mentioned in the company registration form.
Registration on the MCA Portal- A completed SPICe+ form has to be submitted on the MCA portal to apply for company registration. To fill out the SPICe+ form and submit the required documents, the Director of a company needs to register on the MCA portal. After the registration process is completed, the director will get access to the MCA portal services which comprise filing e-forms as well as viewing public documents.
Certificate of Incorporation-After the registration application is submitted along with the concerned documents, the Registrar of Companies will inspect the application. After the application is verified, he will issue the Certificate of Incorporation of the Public Company.

What are the Advantages of Public Limited Company Registration in India?

The advantages of Public Limited Company Registration in India are

Separate Legal Entity
Uninterrupted Existence
Borrowing Capacity
Easy Transferability
Owing Property
Limited Liability

Why Choose BiatConsultant as a Public Limited Company Registration Consultant?

Public Limited Registration in India is a simple process but it requires professional guidance. We at BiatConsultant help you to take a step forward in owning your company by providing you with a hassle-free process of company registration. Our team of experts will guide you.

Also Choosing Biatconsultant as a Public Limited Company Registration Consultant offer multiple advantages:

Team of Experts CA and CS for smooth processing
Multiple Happy Customers from all over India
Dedicated Customer Support for all your Queries
Dedicated Customer Support for all your Queries
Smooth Online process without traveling anywhere
Year of Experience and still counting.

February 10, 2022February 10, 2022

NBFC and Fintechs expectations concerning the upcoming budget.

The current government introduces its third budget of the term in the upcoming 1st February 2022, several objectives of NBFC (Non-Banking Financial Companies) and Financial Technology (Fintech) start-ups have come across concerning easing of criteria related to taxation and assistance from the government in terms of giving low-cost liquidity to the retail NBFCs.

Here are the expectations of the NBFC.

Relaxing tax standards for fintech.
NBFC Low-Cost Funding Expectations.
Facilitate liquidity flows to NBFC and Fintech.
Easing GST/TDS standards.
Increased attention to MSMEs and rural development.

Relaxing tax standards for fintech.

The fintech industry expects the government to develop an ecosystem that is responsive to the growth of technology-driven launches in the fintech sector. The stalwarts from the Financial Technology industry announced that the expectation from the budget is towards motivating the lending NBFCs who are operating financial and technology grounded interventions to provide a boost to the underserved small and medium enterprises.

They said the government should work to ease the tax standards for NBFCs and give them significant liquidity assistance.

They also suggested that motivation should be given to female entrepreneurs by providing similar incentives to tax deductions, ease of access to loans, among others.

NBFCs expectations for low-cost funding.

The NBFC sector has raised a question to the government that the priority of the budget must be moved towards those Micro Small and Medium Enterprises (MSMEs) and small entrepreneurs who haven’t been suitable to generate loans at cheap rates and are in a way underbanked. This offer is expected to make the loan service process easier for them.

NBFC estimates that the Pradhan Mantri Awas Yojana programme (1) should be extended to all rural and urban areas. Benefits must be provided to those in the affordable housing sector, which will help stimulate the economy.

One of the advice is to facilitate the compliance framework for the NBFCs who are providing loans to the underbanked and unbanked small entrepreneurs and MSMEs so that they can be involved in the formal banking policy.

They also believe that liberalised, low-cost financing for retail NBFCs is really important for growth in sub-banking sectors.

Relaxation of liquidity flows to NBFCs and Fintechs.

The economy is making efforts in response to losses due to the pandemic and has developed a growth path. The government’s efforts to recognise the enhanced operations blended with the effectiveness of the fintech to fulfil the lending requirements of the underserved

and unserved sectors of society has given positive signs to the industry.

The fintech industry is awaiting that these efforts made by both the government and the fintech industry are given further motivation in the upcoming budget by publicizing measures to ease the liquidity inflow to the NBFCs and the fintech.

Still, with the right degree of regulation and liberalization of tax governance, it can also give the right ecosystem for the fintech to grow and give innovative credit results for the underserved and cash strapped borrowers, If the budget is suitable to deliver on the parameters of relaxation in the norms of liquidity.

Easing GST/TDS standards.

Fintech and the start-up industry grew phenomenally during the pandemic. These industries now expect the budget to keep them growing and keep investors confident.

Buying Point of Trade (PoS) terminals requires tax exemptions.
Exemptions from GST rates for rural banking agents who remit money between homes.
Subsidies must be granted to offset the waiving of the Merchant Discount Rate (MDR).

The benefits of digital payments have reached intelligent technology customers because of the gentle taxation in place for these independent digital customers. To ensure that the advantages of digital payments reach the lower-tech smart section of the community and accomplish the lofty goal of financial inclusion, there’s a want from the government’s side to introduce relaxations in GST and Tax Subtracted at Source (TDS) in the financial addition of services which are offered by the business outlets across India.

If the government provides the GST and TDS exemption in these services as well, it will lead to a reduction in the cost of providing financial services.

Taking into account the phenomenal development of the launch-ups in times of pandemic, another suggestion from the business is to extend the scope of the Startup India Seed Fund Scheme so that the growth of acquainted startups are given financial contribution for exploration and development, prototype development and for products and service trials.

Greater emphasis on MSME and rural development.

The financial sector considers that the budget should focus on the revival of the financial sector through the development of the rural sector and the revival of MSMEs. This in turn increases the opportunities for livelihoods. To do this, the government has to increase loans to MSMEs. The expectations of NBFCs about increased lending to the rural sector require an adjustment of regulations for NBFCs and banks, particularly about tax and collection matters. NBFCs expect to be able to grant guarantees on the same basis as banks. Other expectations of NBFCs and fintech discriminate between lending to individuals and small businesses and lending to large companies.

Conclusion

The intentions of the NBFCs and Fintechs in this budget revolve around the topics of relaxations in tax standards for the fintech, funding for NBFCs at low cost, ease liquidity flow towards the NBFCs and Fintechs, relaxation in norms connected to GST, TDS, boosted Focus on MSMEs and Rural Development. To add up the expectations of NBFCs and Fintechs is the easing of the norms of lending and funding to the small-scale sector at lower tax rates and procedure of NBFCs at par with banks in periods of issuing guarantees as the banks perform.

ITR Form Capital Gains and Tax Exemptions.

Regardless of the amount obtained or lost, capital gains or losses must be disclosed when filing an income tax return. So, what exactly is capital gain, and how does one report capital gains on an ITR? In this post, we’ll discover out.The earnings made from the selling of capital assets are referred to as capital gains. There are two kinds of capital gains: short-term and long-term. Long-term capital assets are retained for at least 36 months, and short-term assets are held for a shorter length of time.

Capital gains occur when you sell a capital asset for a higher price than you paid for it. Capital assets are investment products such as mutual funds, stocks, or real estate products such as land, houses, and so on.

Capital gain refers to an increase in the value of these investment goods when they are sold. Similarly, capital loss is utilised when the asset’s value falls below its acquisition price. A realised capital gain occurs when an asset is sold for a higher price than it was originally purchased for.

Ways to calculate capital gains:-

Capital gains tax on short-term profit

The following formula is used for short-term capital gains:

Short-term capital gain = (cost of purchase + cost of improvement + cost of transfer) – full value consideration

Taxation of long-term capital gains

The following formula is used to calculate long-term capital gains:

Long term capital gain = full value of consideration received/acquired – (indexed cost of acquisition + indexed cost of improvement + cost of transfer), where indexed cost of acquisition = cost of acquisition x cost inflation index of transfer/cost inflation index of acquisition.Indexed cost of improvement = cost of improvement x cost inflation index of transfer year / cost inflation index of improvement year

The capital gains tax rate

The rate at which capital gains in ITR form are computed may differ from year to year. Individuals are taxed at a rate of 20.6 percent on long-term capital gains. There are no deductions available under capital gains tax. It should be emphasised that the short-term capital gains tax is levied based on the tax bracket into which an individual falls.

Gains on the sale of immovable property

Gains from the sale of immovable property within two years after acquisition are termed short term capital gains, whereas gains beyond two years are considered long term capital gains. Long-term capital gains are taxed at a rate of 20% with indexation, whilst short-term capital gains are taxed at the slab rate.

Gold and bonds, as well as jewellery and bullion, are subject to capital gains tax regardless of how they were obtained—self-purchased, gifted, or inherited. If it is sold within three years of the acquisition date, the gains are considered short term capital gains; otherwise, the gains are considered long term capital gains.

Short-term capital gains from the sale of gold are taxed at the slab rate, whereas long-term capital gains are taxed at 20% plus indexation. Gains from the transfer of shares and equity-oriented mutual funds within one year of acquisition are considered short-term capital gains, whereas gains beyond one year are considered long-term capital gains.

Capital Gains Disclosure on ITR Form: Tax Exemptions

The government provides a number of exemptions that can be claimed on capital earnings generated. The list of exclusions that can be claimed with regard to capital asset gains is detailed below.

According to Section 54 of the IT Act[1,] a person is eligible to a tax exemption on profit made if the entire profit amount is utilised to acquire a property. The seller may buy a new house within two years after the sale of his old property, or he may build a new house within three years of the sale.

Section 54 EC exempts an individual from paying taxes if the whole capital gain is invested in bonds issued by the NHAI (National Highway Authority of India) or Rural Electrification Corporation. There is a limit to exemption under Section 54 EC.

Capital gains will not be taxed on the sale of property if the entire amount is invested in the formation of a small or medium-sized enterprise. To qualify for tax breaks, manufacturing tools and machinery must be bought within six months of the sale.

Capital losses can be used to balance the tax effect on capital gains in the computation of tax, although only long-term capital losses can be set off against LTG. Short-term capital losses can be offset against short-term and long-term capital profits.

October 21, 2021October 21, 2021

Registration Requirements for Web Aggregators

Who are Web Aggregators?

Web aggregators are insurance intermediaries who are registered with Insurance Regulatory and Development authority of India (IRDA). Web aggregators have registered websites on which they provide duly compiled information of all the insurance policies provided by different insurance companies.

Who can be an Applicant?

Following are the persons who can apply for Insurance web aggregator-

Any company registered under Companies Act, 2013 or any of its previous versions.
Any LLP registered under Limited Liability Partnership Act, 2008. However, the following persons cannot be a partner in that LLP.
Non-resident entity.
Any LLP registered under Foreign laws
Any person resident of outside India as prescribed under Foreign Exchange Management Act, 1999 (FEMA)
Any person duly recognized by IRDA as an Insurance web aggregator.

Eligibility criteria for registration as an Insurance web aggregator

Minimum Capital Requirements

To apply for an insurance web aggregator, the applicant is required to meet the minimum capital requirement of Rs. 25 Lakh.

In case of a company, such capital must be issued in the form of subscribed capital

And in case of a Limited Liability Partnership then the contribution must be in the form of cash only.

Minimum Net worth Requirement

The minimum net worth requirement for insurance web aggregators is Rs. 25 Lakh.

For this purpose, they are required to review their Net Worth half yearly on 30th September as well as on 31st March every year. Along with these reviews, web aggregators are also required to submit a certificate from a Chartered Accountant to the Authority every year after the finalization of its accounts.

Application Fee

While submitting an application form for Insurance web aggregator the applicant is required to submit non-refundable application fees of Rs. 10,000/- plus applicable taxes on the same.

Application for Registration

For application form for Insurance web aggregators one has to fill and submit the Form A. format of Form A is provided in schedule I of the regulations.

Validity of Certificate of registration

Once the certificate is issued to the applicant, it remains valid for a period of 3 years from the date of registration and issue of such certificate.

However, it can be cancelled or suspended by the authorities at any point of time before that in case of any non-compliance of the provisions stated in the regulations.

Conditions for Registration

There are certain conditions whale analysing the application and they are as follows-

The applicant is as per the person defined under regulation 2(k)
To make sure that the applicant is not registered as any other form of insurance intermediary as per the relevant regulations issued by the authorities. However, if any of its group entities is involved in any other kind of insurance intermediary business, registration can be granted after making sure that there are no conflicting interests.
The applicant must not be in kind of referral arrangements with any registered Insurer.
The applicant must have a registered website to undertake web aggregator activities.
The appointed Principal Officer must have specified academic qualifications as mentioned in Form C of Schedule I and has undergone the specified training and qualified the examination for the same.
Along with the principal Officer, the Authorized Verifier must also have completed the relevant training and passed the specified examinations.
All the officers of the applicant organization must qualify the fit and proper criteria specified in Form D of schedule I.
The Authority must check if in past one year any application for registration as a web aggregator is either rejected by the Authority itself or voluntarily withdrawn by the applicant.
The registration granted must be in favour of the policy holders.

October 4, 2021October 4, 2021

What are the functions of IRDA?

Insurance Regulatory and Development Authority also called as IRDA, is the supreme authority that authorizes the functioning of insurance business in India. It was established by IRDA Act, 1999. The primary purpose of IRDA is to safeguard the interest of policyholders and also to ensure the growth of the insurance company in the country. In this blog we will discuss the various roles and functions of IRDA.

Objectives of IRDA

Following are the objectives of IRDA-

To carry forward the interest of policyholders.
To uphold the development of the insurance sector.
Ensure quick resolution of claims
Prevent frauds and malpractices
To ensure fair conduct in the financial market when dealing with insurance.

Significance of IRDA Functions

IDA is an apex statutory body that regulates and develops the insurance sector in India. In India general insurance was first built in Kolkata in the year 1850. Since then various players in this market. Each organization rehearsed business on its own rates and rules. It made clients unreliable, which brought into question the validity of the insurance. With time the administration understood this reality and subsequently set up an autonomous administrative body called IRDA. After that new requests came out and the market was rushed and overflowed with he insurance products.

Functions of IRDA

Section 14 of the IRDA Act, 1999 gives the authority to ensure the regulation, development and promotion of the insurance business. Some of the essential functions of IRDA are as follows-

To provide applicants with the registration certificate, renewal, modification, withdrawal, suspension or cancellation of such registration.
To protect the interest of policyholders in case of assigning and nominating the policyholders, understanding insurance claims, insurable interests, surrender the value of the policy and other terms and conditions of the insurance contract.
To mention required qualifications, code of conduct and practical training for intermediary/ insurance intermediaries and agents.
To explain the code of conduct applicable to the surveyors as well as to the assessors.
To ensure the efficiency and proficiency of the conduct of the insurance business.
To levy charges in order to carry out the purpose of the act.
To call for information, undertaking, inspection, conducting enquiries and investigations, including the audit of insurers, intermediaries, insurance intermediaries and other organizations connected with the insurance business.
To regulate and control the rates, benefits, terms and conditions offered to the insurer pertaining to general insurance business not controlled and regulated by the tariff advisory committee under section 64U of the insurance act, 1938.
To specify the way in which the books should be maintained and the manner in which the statement of accounts is to be rendered by insurers and other insurance companies.
To maintain the investment funds by the insurance companies.
Regulation of the maintenance of margin solvency.
They decide the dispute among the insurers and the intermediaries of insurance intermediaries.
To administer the functioning of the tariff advisory committee.
Setting down the percentage premium income of the insurer of the finance scheme to promote and regulate the professional organizations.
To safeguard the interest of the policyholder in case of assigning and nomination of policyholders.
Setting out the percentage of life insurance business and general insurance business to be taken ahead by the insurer in the rural or social secor.
To regulate the insurance industry in a way that ensures financial soundness of the applicable laws and regulations.
To periodically frame laws to remove any scope of ambiguity in the insurance sector.
To take action where the appropriate standards are inadequate or not enforced effectively.
To grant, modify or suspend licenses for insurance companies.
To perform such other functions of IRDA as may be prescribed.

Conclusion

There are some roles of IRDA. in an Indian economy there are many insurance companies that are coming in the market. Here IRDA has some special role to play. In order to keep the pace of the development the functions of IRDA should be performed accurately enough to provide every player with a fair deal and also to make sure that the customers also have a variety of plans to choose from.

August 16, 2021August 16, 2021

Domestic Transfer Pricing

What is Domestic Transfer Pricing?

Transfer Pricing provisions were earlier restricted to international transactions only but now it has extended to specific domestic transactions also with effect from 13th April, 2013.

Legal Definition of Domestic Transfer Pricing

Section 32 BA defines domestic transactions which are governed by the TP regulation which states that specified domestic transactions in case of the assessee mean any of the following transaction-

Any expenditure to be incurred or to be incurred in connection with a payment made or to be made to a person referred to in section 40A (2)(b).
Transactions referred to in section 80A.
Any transfer of goods or provision of services as provided in subsection 8 of section 80 – IA.
Any business transaction between the assessee and another person as referred to in subsection 8 of section 80 – IA
Any transactions which have been mentioned under section under chapter VI-A or section 10AA, o a person to whom provisions of subsection 8 or subsection 10 of section 80 IA is applicable
And where the aggregate of such transactions entered into by the assessee in the previous year exceeds 20 crores
Any other transactions as may be prescribed.

Threshold Limit

The above provisions will only be applicable if the aggregate value of the turnover of the above mentioned transactions exceeds above 20 crores.

Applicability of Domestic Transfer Pricing

Taxpayers cannot apply for transfer pricing to a specific domestic transaction to reduce the tax liability.
Monetary threshold limit of Rs. 20 crores will be calculated according to the receipts and on the basis of aggregate payment to which these provisions apply.
Definition of Related party includes expenses disallowed to cover the entities which have common beneficial ownership
Transfer pricing is applicable to international transactions and to specific domestic transactions only. It specifically excludes Advanced pricing agreement provisions.

Concept of Arm’s Length Price (ALP)

The concept of ALP has also extended to specific domestic transactions only. ALP is denied as the price which is applied to the proposed to be applied in a transaction the assessed one and any other unrelated person.

Methods of Computing ALP

Flowing are the methods for computation of ALP-

Comparable uncontrolled Price method- Under the CUP method, a price that is charged in an uncontrolled transaction between the comparable firms is recognized and evaluated with a verified entity price for determining the Arm’s Length Price.

Resale Price method- This means its application looks to transactions between unrelated parties as a means to determine an arm’s length price for the intercompany controlled transaction under review.

Cost plus method- It means it is based on markups observed in third party transactions. While it’s a transaction-based method, it is less direct than other transactional methods and there are some similarities to the profit-based methods.

Profit split method- It evaluates whether the allocation of the combined operating profit or loss attributable to one or more controlled transactions under ALP.

Transactional net margin profit- It compares the net profit margin of a taxpayer arising from a non-arm’s length transaction with the net profit margins realized by arm’s length parties from similar transactions.

Such other methods may be notified as board- These are any other methods which are prescribed by the Board.

Documentation required

Company related documents-

Profile of the company
Profile of the group companies
Profile of the unit claiming tax holiday
Profile of all the related parties.

Transaction related documents-

Agreements
Invoices
Pricing related correspondence such as emails, Letters etc.

Price Related Documents-

Terms of the Transactions
Functional analysis specifying functions, risks and assets.
Economic analysis containing method, selection and comparable benchmarking.
Budgets and comparable.

Other supporting documents cuh as official public reports by the government such as stock exchanges, and financial statements.

For any Transfer Pricing related queries reach us at info@biatconsultant.com.

July 5, 2021July 5, 2021

PMS V/S AIF: Let’s Understand the Difference between the Two

What are PMS (Portfolio Management Services)?

PMS are the tailored investments portfolio in fixed income of an individual, in equity securities and structured products. It basically caters the investments of high net worth individuals with a minimum ticket size of Rs. 50 Lakh/-.

PMS services are discretionary or non-discretionary. In discretionary portfolio managers manage your portfolio by tracking the market and by keeping your investment criteria in mind whereas in non-discretionary investors can themselves take final decisions.

In PMS, individuals have to actively monitor and track the developments themselves on a regular basis. Since an experienced portfolio manager manages your investment, all you have to do is review the transactions periodically and get performance updates. This also helps in best returns in the investments.

What are AIF

AIFs involve higher minimum investment, and it includes higher risk and has probability of higher returns. These are the pooled investments for investing in hedge funds, venture capital, futures, and private equity.

That is why AIFs are considered to be the best by many of the investors.

PMS or AIF : Which one is better?

Particulars	PMS	AIF
Regulation	They are regulated by SEBI (Portfolio Managers Regulations, 1993)	They are governed by SEBI (Alternative Investment funds Regulations, 2012)
Pooling of Funds	Funds are not pooled	Pooling funds are the essence of this kind of investment.
Number of Investors	There is no threshold limit. Portfolio Managers can have any number of clients	It should not exceed more than 1000.
Fees	Apart from the non-refundable fees of Rs 1,00,000/-, registration fees of Rs. 10 Lakh is to be submitted at the time of the grant of the certificate of registration.	Apart from the non-refundable fees, registration fees of Rs. 5 Lakh in category of AIF, Rs.10 Lakh in category II and Rs. 15 Lakh in category III of AIF is to be submitted.
Validity of Registration	It is valid upto three years, and it should get renewed at least 3 months before the expiry.	It is valid until the AIF is wound up.
Types	PMS have two categories-DiscretionaryNon-discretionary	AIF’s are of three types-Category ICategory IICategory III
Segregation of Funds	Funds of every client are segregated separately in a DEMAT Account.	There is no segregation of funds required
Minimum Investment Limit	25,00,000/- (25 Lakh)	1 Crore
Corpus Requirement	No Corpus required	Each scheme is required to have a corpus fund of Rs. 20 crore. In case of angel funds the requirement of Rs. 10 Crore.
Listing	No Listing	Close ended units can be listed after the closure of such limits.
Tenure of securities	No minimum time limit is prescribed. It is adhered by an agreement between the portfolio manager and client	Category I and II have tenure of three years which can be extended upto 2 years.

Conclusion

Therefore there are many differences between the PMS and AIFs. There is an increase in the interest investor in these areas SEBI is planning to align the services of PMS and AIFs both. In 2003 SEBI increased the investment requirement from 5 Lakh to 25 Lakh and now they are planning to increase upto 1 Crore as of AIFs.

Since Both the PMS and AIFs are high risks, involves higher returns, it is crucial to have an excellent.

Get our expert services and guidance over investment in PMS or AIFs.

February 15, 2021February 15, 2021

Yearly compliance checklist for Startups In India

Do you intend to set up a startup but worried about several laws to follow? In case your answer is yes then we can help you with all the compliances regarding start up.

With regard to start up, money is precious and it won’t be a good idea to waste some currencies as penalties towards non-compliance. So, follow rules and regulations to bypass hurdles.

The various laws you must follow:

Goods and Services Act (GST)
Companies Act
Labor and mercantile laws
Income Tax Act

After getting your startup registered as an Indian company, it is essential to follow the provisions specified in the Companies Act, 2013.

List of major things one should not miss with regard to startup:

Accounts filing with ROC (Form AOC-04)
Board meetings
Statutory Audit
Annual General Meeting (AGM)
Annual Returns with ROC (Form MGT-07)

These happen to be some chief Startup compliances that individuals must follow but apart from these there are some more forms that differ. To give an example, if you have taken a bank loan, you must file the CHG-01 form with ROC to get your charge registered. There exists a penalty for the late filing of the statutory forms.

It is essential for every company to get the turnover audited by a certified CA every year. Even if there had been no transaction in a year.

Filing income tax is a must

In case the startup is formed as a limited liability partnership or a proprietor company, it is mandatory to file the income tax. If the taxable income happens to exceed the exemption limit, you must file within a certain time limit. A fee is levied for filing income tax late.

Startup Checklist to follow with GST

The ideal thing about GST is that you are no longer required to pay indirect taxes. Goods and Service tax is an easy and convenient tax regime. You should register under GST in case of a turnover of over Rs 20 Lakhs annually. If you happen to hail from any special states, you must get registered if the turnover exceeds Rs 10 Lakhs annually. In case you happen to be an online seller, GST compliance is mandatory.

In short, you must follow below-mentioned Startup compliances for GST:

Annual GST in case the annual turnover goes beyond Rs 2 Crores.

Registration if you go beyond exempted turnover of Rs. 20/10 lakhs

Monthly returns in case the turnover exceeds Rs 1.5 Crores or else quarterly returns

Annual returns

EWAY bill for transportation if the value of invoice crosses Rs 50 thousand for transportations of the goods.

Startup checklist to follow with labor laws

There are three chief laws applicable to a company on the basis of the number of employees working under you:

Provident fund

Provident fund applies to you if there are over 20 people working under you. You have to register under PF and file the returns. Each month, a part of employees’ salaries must be cut and paid to the government together with the share of the employer. Then, a return must be filed. Do not ignore PF as it is a critical law to be followed.

ESI

Employees’ State Insurance happens to be a health insurance and social security scheme meant for the workers in India. This fund is handled by the State Insurance Corporation for employees as per the ESI ACT 1948. The ESI law functions akin to the PF law.

Profession Tax

For certain states, it is essential to file the profession tax. For example, in states like Karnataka, in case you pay over Rs 15,000 salary then it is a must to subtract Rs 200 each month and pay the same to the government.

It is a must to follow these laws so that your company does not face any legal hurdles going forward. Hence, ignore this at your peril.

Who we are?

We are one of the leading business management consultants in India providing several services such as Proprietorship Firm Registration and Start up Compliance Package and Company Compliance Package. We also offer a host of services in tax administration and procedure expansion to efficiently manage GST compliance Process. You may contact biatconsultant.com now

December 18, 2020December 18, 2020

An overview on Company Fresh Start Scheme 2020

On 30^th March 2020, The Ministry of Corporate Affairs issued a circular pertaining to Companies Fresh Start Scheme 2020. This happens to be another window for all defaulting companies to file every belated document as newly began documents devoid of any extra fees. Under the scheme, the companies get the breather to file their outstanding documents such as annual returns and financial statements sans paying any extra fee for the delay.

The Intent:

Giving exemption from extra fees: It happens to be a single-time prospect to assist stakeholders in filing their due compliances such as Annual Return and Financial statement and several other statements, documents and returns to be filed with the Ministry of Corporate Affairs (MCA),minus the additional fee due to the hold up.

Getting Immunity: To get protection from prosecution or proceeding or being made to pay a penalty due to the delay regarding filing of belated documents (and not any other consequential proceeding).

Opportunity to dormant companies: To grant an option to dormant companies to get their entities labelled as inactive company as per section 455 of the Companies Act, by filing a normal application at regular fees, which would assist these inactive companies to be on the register of the Companies with very few compliance obligations.

Period: The Companies Fresh Start Scheme would be active on the 1^st of April 2020 till the 30^th of September 2020.

NON-APPLICABILITY: The Fresh Start Scheme will not be applicable in these cases:

For entities against which action for last notice for deleting the name as per 248 of the Act has already been launched by the concerned authority.

In cases where any application has already been filed by the Companies for deleting the name of the Company from the registrar of Companies.

To Companies that have merged as per a scheme of arrangement or compromise under the Act.

In cases where applications have already been filed for keeping inactive status under section 455 of the Act prior to the scheme.

To varnishing Companies.

In cases where any spike in authorized capital (Form SH-7) and charge related documents (Form CH-1. CH-4, CH-8, CH-9) are in the fray.

The immunity will not be there with regard to any appeal pending before the court of law and if a management dispute arises regarding the Company and the same is pending before any court of law or tribunal.

The immunity is not applicable if any court has convicted in any matter or an order levying any penalty has been issued by an adjudicating authority under the Act.

Method:

The defaulting company can file their pending documents/returns/other statements and standard Annual Filing documents in relevant specified e-Forms by giving the regular statutory filing fee (minus any extra fee) within the immunity period.

The defaulting Companies has to file the Form CFSB-2020 after ending all defaults and every filings are put on record or authorized by the Designated authority accordingly. This form can even be filed post the end of the Scheme but not after six months have expired from the date of closure of the Scheme. There are no filing fees of Form CFSB-2020.

The Form CFSB-2020 is a form totally based on self-declaration. Post submitting Form CFSB-2020 and as per self-declaration made by the Director, the ROC will provide Immunity Certificate.

PLAN FOR INACTIVE COMPANIES: The defaulting welsh companies while filing the outstanding documents as per CFSS 2020, can side by side either:

Apply to get themselves certified as inactive Company under section 455 of the Companies Act 2013 by filing e-form MSC-1 at regular fee on said form or;

Apply for getting the name of the company deleted by filing e-form STK-2

The Companies Fresh Start Scheme is to boost the special measures under Companies Act, 2013 (CA-2013) and Limited Liability Partnership Act, 2008 with regard to the COVID-19 outbreak, to give respite to the obedient Companies and Limited Liability Partnerships.