INDIRECT TAXES COMMITTEE 2nd Residential Refresher Course on Service Tax held on 3rd January to 5th January, 2014 at The Lagoona Resort, Lonavala. CA Yatin Desai, President inaugurating conference by lighting CA Ashit Shah, Chairman welcoming the delegates at the lamp. Seen from L to R : CA Parimal Parikh, Past 2nd RRC on Service Tax. Seen from L to R: Shri P. K. President, CA Ashit Shah, Chairman, Shri P. K. Sahu, Faculty, Sahu, Faculty, CA Yatin Desai, President, CA Pranav CA Pranav Kapadia, Vice Chairman, CA Rajiv Luthia, Member. Kapadia, Vice Chairman. Faculties Shri P. K. Sahu, Advocate Shri V. Raghuraman, Advocate CA Parind A. Mehta Shri V. Sridharan, Sr. Advocate 2nd RRC on Service Tax – Group Photo INFORMATION TECHNOLOGY COMMITTEE Info Tech Update Series Workshop held on 23rd January, 2014 on the subject “Smart apps for Tax Professionals (How to get the most out of your smart phone)” at Babubhai Chinai Committee, IMC. CA Sanjay Chheda addressing the members. Seen from L to R : Shri Subhash Shetty, Past President, CA Yatin Desai, President, CA Samir Kapadia, Faculty and Shri Kishor Vanjara, Past President. RRC & PR COMMITTEE AND MEMBERSHIP & EOP COMMITTEE 2nd Chamber Premier League, 2014 (CPL) held on 18th January, 2014 at Oval Maidan. Winning Team (CPL – 2014) – Past President – XI Runner-up Team (CPL – 2014) – Imm. Past President – XI Vol. II No. 5 C NTENTS February – 2014 (GLWRULDO K. Gopal )URPWKH3UHVLGHQW Yatin Desai $Q,QWURGXFWLRQWRă9HGDQG9HGDQWDV. H. Patil SPECIAL STORY : International Taxation ,QGLUHFW7UDQVIHUDQG&DSLWDO*DLQV N. C. Hegde 5R\DOWLHVDQG)HHVIRU7HFKQLFDO6HUYLFHV ă5HFHQW'HYHORSPHQWVVispi T. Patel & Rajiv G. Shah &XUUHQW,VVXHVLQ,QWHUQDWLRQDO7D[DWLRQUHODWLQJWR FHUWDLQSD\PHQWVTarunkumar Singhal 7D[DWLRQRI([SDWULDWHVC.A. Gupta & Samir Parekh 3(ZLWKUHIHUHQFHWRH&RPPHUFHRashmin Sanghvi ..................................... 51 ,QFRPHDULVLQJRXWRI,QWHUQDWLRQDO7UDQVDFWLRQV ă&KDUJLQJ3URYLVLRQV0$3DQG$UWLFOHSudhir Nayak ,QGLDQ7UDQVIHU3ULFLQJ 73 ă5HYHQXH VDSSURDFK RQ73$VVHVVPHQWRajendra Nayak &DVH/DZV,QGH[ DIRECT TAXES Ć +LJK&RXUW Ashok Patil, Mandar Vaidya & Priti Shukla Ć 7ULEXQDO Jitendra Singh & Sameer Dalal Ć 6WDWXWHV&LUFXODUV 1RWLILFDWLRQVSunil K. Jain INTERNATIONAL TAXATION Ć &DVH/DZ8SGDWHTarunkumar Singhal & Sunil Moti Lala INDIRECT TAXES Ć &HQWUDO([FLVHDQG&XVWRPVă&DVH/DZ8SGDWHHasmukh Kamdar Ć 9$78SGDWHJanak Vaghani Ć 6HUYLFH7D[ă6WDWXWH8SGDWHRajkamal Shah & Naresh Sheth Ć 6HUYLFH7D[ă&DVH/DZ8SGDWHBharat Shemlani CORPORATE LAWS Ć &RPSDQ\/DZ8SGDWHJanak C. Pandya .................................... 105 OTHER LAWS Ć )(0$8SGDWHMayur Nayak, Natwar Thakrar ............ 108 ..................................................................................& Pankaj Bhuta BEST OF THE REST Ajay Singh & Suchitra Kamble TAX ARTICLES FOR YOUR REFERENCEKishor Vanjara ECONOMY & FINANCERajaram Ajgaonkar YOUR QUESTIONS & OUR ANSWERSV. H. Patil THE CHAMBER NEWSHitesh R. Shah & Hinesh R. Doshi i | The Chamber's Journal | )HEUXDU\| 3 ¯ The Chamber of Tax Consultants 3, Rewa Chambers, Ground Floor, 31, New Marine Lines, Mumbai – 400 020 Phone : 2200 1787 / 2209 0423 • Fax : 2200 2455 (0DLO RI¿FH#FWFRQOLQHRUJ :HEVLWH KWWSZZZFWFRQOLQHRUJ The Chamber's Journal Editor & Journal Committee Managing Council Editorial 2013-14 2013-14 Board Chairman 3UHVLGHQW 2013-14 Yatin Vyavaharkar Yatin Desai (GLWRU 9LFH &KDLUPDQ VLFH3UHVLGHQW K. Gopal Apurva Shah Paras Savla (GLWRULDO %RDUG ([2I¿FLR Yatin Desai Paras Savla +RQ6HFUHWDULHV Chairman Convenors Hitesh Shah Hinesh Doshi V. H. Patil Toral Shah Bhavik Shah Members 3DVW 3UHVLGHQW 7UHDVXUHU ,PP3DVW3UHVLGHQW Keshav Bhujle Vipin Batavia Avinash Lalwani Manoj Shah Kishor Vanjara 2I¿FH %HDUHU Members Pradip Kapasi Hinesh Doshi S. N. Inamdar Ajay Singh Apurva Shah Subhash Shetty 0J&RXQFLO 0HPEHU Ashit Shah Ashok Sharma Vipul Choksi $VVW (GLWRUV Haresh Kenia Jayant Gokhale Reepal Tralshawala Members Keshav Bhujle Ketan Vajani Atul Bheda Bakul Mody Heetesh Veera Bhadresh Doshi Dhaval Thakkar K. Gopal Kishor Vanjara Chairman Dhiren Dalal Hasmukh Kamdar Mahendra Sanghvi Paresh Shah Yatin Vyavaharkar Ms. Indira Gopal Janak Pandya Parimal Parikh Vijay Bhatt Ketan Jhaveri Mitesh Kotecha ([2I¿FLR Ms. Nikita Badheka Pankaj Majithia Vipul Joshi Vipul Choksi Yatin Desai Rajkamal Shah Shivratan Singrodia Yatin Vyavaharkar Paras Savla Ms.Sonal Desai DISCLAIMER 2SLQLRQVYLHZVVWDWHPHQWVUHVXOWVUHSOLHVHWFSXEOLVKHGLQWKH-RXUQDODUHRIWKHUHVSHFWLYHDXWKRUVFRQWULEXWRUV 1HLWKHU7KH&KDPEHURI7D[&RQVXOWDQWVQRUWKHDXWKRUVFRQWULEXWRUVDUHUHVSRQVLEOHLQDQ\ZD\ZKDWVRHYHU IRUDQ\SHUVRQDORUSURIHVVLRQDOOLDELOLW\DULVLQJRXWRIWKHVDPH 1RQUHFHLSWRIWKH5HYLHZPXVWEHQRWL¿HGZLWKLQRQHPRQWKIURPWKHGDWHRISXEOLFDWLRQZKLFKLVWKRIHYHU\PRQWK 1RSDUWRIWKLVSXEOLFDWLRQPD\EHUHSURGXFHGRUWUDQVPLWWHGLQDQ\IRUPRUE\DQ\PHDQV ZLWKRXWWKHSHUPLVVLRQLQZULWLQJIURP7KH&KDPEHURI7D[&RQVXOWDQWV ADVERTISEMENT RATES 0(0%(56+,3)((6 -2851$/68%6&5,37,21 5(9,6(')((6$1'68%6&5,37,21)520 3HU ,QVHUWLRQ Sr. Membership Type Fees Service Total Fourth Cover Page ` 10,000 No. Tax Second & Third 12.36% Cover Page ` 7,500 1. Life Membership 9500 1174 10674 Ordinary Full Page ` 5,500 Additional Optional subscription charges for Annual Journal ` 550 0 550 ` 11224 Ordinary Half Page ` 2,750 2. Ordinary Members Ordinary Quarter Page ` 1,500 Entrance Fees ` 200 25 225 Annual Membership Fee, including subscription for Journal 1300 161 1461 ` 1686 DISCOUNT 3. Associate Membership Entrance Fees ` 1000 124 1124 25% for 12 insertions. Membership Fees including Subscription for Journal 2000 247 2247 15% for 6 insertions. ` 3371 4. Student Membership Entrance Fees ` 250 31 281 Journal Subscription 700 0 700 ` 981 Full advertisement charges should be paid in advance. 5. Non-members Journal Subscription ` 1000 0 1000 ` 1000 ii ¯4 | The Chamber's Journal | )HEUXDU\ | Editorial The month of February has always been very special in the busy schedule of all the members of the Chamber as it is the month of RRC. I am sure everyone is waiting for it to unfold as it would mean lots of interactions in a relaxed environment, in the lap of nature. The current session of Parliament would draw the curtains over the 15th Lok Sabha and we are heading towards general elections – exciting times indeed! At such a crucial juncture, a look back at the times sends shivers down the spines of all of us – Indian Democracy is standing at the crossroads and is going through a churn – a churn which has brought to the fore – corruption, inefficiency, apathy, ineptitude, opportunism etc. (the list of adjectives would be long winding) that have left the common man perplexed. The political class as a whole has lost the trust of the common man. However, being an eternal optimist that I am, I would rather see the light at the end of the tunnel rather than the darkness that has surrounded us – the light shed by the fact that despite the exposure of the rot, the masses of India have an unflinching faith in Democracy and its institutions and also in the spirit of the constitution. This was amply visible in the wide-spread disapproval of the 'illegal' methods adopted by a State Government which has been brought into power for being 'different' and 'clean'. With this faith, I wish the next general elections would set the agenda of development and empowerment of all classes of the populace. I wish the political class of the country hears the clarion call that public cannot be fooled into loyalty by mere gimmicks and that they need to rework their goals and methods. This edition of Chambers' Journal has a Special Story on International Taxation. My sincere thanks to all the authors who contributed to this edition. Special thanks to Shri Paresh Shah for his efforts. K. GOPAL Editor iii | The Chamber's Journal | )HEUXDU\| 5 ¯ From the President Dear Members, February is the most awaited month in the Calendar of the Chamber as in February we have our flagship event i.e. Residential Refresher Course (RRC). This year it happens to be 37th RRC and coincidentally, I am the 37th President. RRC, for the first time, will be held at Pondicherry, which is on the Eastern Coast of India. Overwhelming response to the venue will open gates for the future RRCs at farther places. The Chairman of the RRC committee and his team members along with the Advisor Mr. Kishor Vanjara have put in utmost efforts in planning to make the RRC educative and entertaining. The Chamber has a practice of introducing atleast one paper writer presenting his paper for the first time. The legacy continues. This year, we have two papers which will be presented by the paper writers for the first time for the Chamber. Pondicherry is known for Aurobindo Ashram. The place where people come from around the world for practicing Yoga. And keeping that in mind, the theme of the RRC is rightly kept, ‘Meditate…Introspect…Reflect!!!’ By the time you receive copy of this issue, the RRC would have been over. I am sure the RRC will turn out to be educative, entertaining and memorable. The Chamber played 2nd Cricket match, Chamber’s Premier League 2014 on 18th January, 2014. The matches were played in the festive mood and in the true spirit of the game. However, this year too, it was marred by injuries by way of fractures to two members. The events such as this, reminds us for keeping ourselves fit and healthy. The Chamber’s Journal is the mouthpiece of the Chamber. The Committee tries to lift the quality of the Journal on an ongoing basis. Periodically, the Committee invites contributors for a meeting, called Marathon Meeting, for their