The prescribed depreciation rates come into play for determining the value when the goods are removed from the SEZ into DTA, either for sale or for any purpose, including the exit of the unit. When the unit continues in the SEZ, the need for determining the value after reckoning depreciation does not normally arise. For determining the NFE, the amortisation is allowed at 10 per cent per year. For accounting purposes, the depreciation can be worked out as per the Companies Act
and for income tax purposes, as per income tax laws.
The government has brought in Rule 36(4) of the CGST Rules, 2017 restricting the ITC to 20 per cent of the eligible credit for invoices and debit notes not uploaded by the supplier. Can we challenge it on the grounds that once we have paid the supplier for the invoice, including the tax amount, we should not be deprived of the credit?
Section 16(1) of the CGST Act, 2017 says that every registered person shall, subject to such conditions and restrictions as may be prescribed and in the manner specified in section 49, be entitled to take credit of input tax charged on any supply of goods or services, or both, to him which are used or intended to be used in the course or furtherance of his business. Apparently, the government is of the view that the power to restrict the credit flows from this provision. However, the alternate view is that the conditions and restrictions allowed under the provision can be limited only to procedural and documentation requirements, and not the quantum of credit. In my opinion, it is worth putting the restriction to judicial scrutiny.
Can we remit claims of a foreign buyer for our exported goods found defective?
Para C.22 of RBI Master Direction no.16/2015-16 dated February 2, 2016, says that banks may remit export claims on application, provided the relative export proceeds have already been realised and repatriated to India and the exporter is not on the caution list of the Reserve Bank of India, and the exporter is advised to surrender proportionate export incentives, if any, received by him.
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