Readymade Companies in India

8/9/2019 Readymade Companies in India

1/75

PRESENTATIONon

DOING BUSINESSIN INDIA

Registered office:SCO 35, Second Floor, Sector -26, Chandigarh

160 019Tel- 91-1 2-2 90366, 2 900 5, Fa!-91-1 2-

2 90260, "o#ile-09$1%0112 $&'ail: ra'an(ra'anaggar)al*co'


2/75

WELCOME


3/75

ABOUT ARAARA is a firm of chartered acco ntants!

ARA firm "as formed in the #$%% &'' (ears) !

ARA firm *ro+ide Ser+ices in the area of A dit, Ta- &Direct, indirect) andAd+isor(!

ARA team is com*rised of more than '. m /ti dis*/ined *rofessiona/s s chas Chartered Acco ntants, Com*an( Secretar(, La"(ers, Cost Acco ntantsand MBA0s!

ARA ha+e state of the art faci/it( in Chandi1arh, Ne" De/hi 2 P ne !

ARA ha+e more then #33 Cor*orate C/ients and /eadin1 MNC0s &for USA, U4,5a*an, Midd/e East, E ro*e) !

Mr! Raman A11ar"a/, the CEO 2 6o nder em*ane//ed "ith the 7Office ofOfficia/ Li8 idator9 attached "ith the :i1h Co rt of P n;a


4/75

SER=ICES 2 SOLUTIONSAUDIT AND ASSURANCE

TA> 2 REGULATOR? SER=ICES

SPECIALIT? SER=ICES

Settin1 * Ne" B sinessIncor*oration of a Limited Com*an(Settin1 * of STPI Unit and MaintenanceSettin1 * of SE@ UNIT and MaintenanceDoin1 B siness in IndiaDoin1 B siness O tside IndiaSettin1 * Offshore Com*aniesInternationa/ E-ec ti+e Ser+icesB siness Re1istrationsInte//ect a/ Pro*ert(Pa(ro// Ser+icesCor*orate Secretaria/ Ser+ices

=irt a/ Office Ser+ices4PO Acco nts and Ta- O tso rce Ser+ices

INTERNATINOL TA>ATION

6INANCIAL AD=ISOR? SER=ICES

LEGAL SER=ICES

OUTSOURCING SER=ICES


5/75

TEAMS!NO NAME UALI6ICATION E>PERIENCE

# Mr! Raman A11ar"a/ 6e//o" CharteredAcco ntant

'. ?ears in Acco nts, 6inance,Ta-, Le1a/, Mana1ement etc!

' Mrs! Sim*( G *ta Bache/or in La"! 2Com*an( Secretar(

#. ?ears in Le1a/ 2 Cor*orateaffairs

Mr! Sameer Sa"r * 6e//o" CharteredAcco ntant

# ?ears in Acco nts, 6inance,Ta-, Le1a/, Mana1ement etc

Mr! Unni 4rishnan Grad ate #% ?ears e-*erience in Cor*orateAffairs

. Ms! Arti Post Grad ate $ (ears e-*erience in Re1 /ator(Com*/iances

Mr! San;a( A11ar"a/ Chartered Acco ntant #% ?ears Acco nts, 6inance 2 Ta-

F Mr! S man Master in Commerce # ?ears in Acco nts, 6inance,Ta-, Le1a/, Mana1ement etc

% Mr! =ineet Tha ra/ Master in La" 2Mana1ement

' ?ears Ta- and Re1 /ator(

$ Ms! Manmeet 4a r Masters in La" ?ears Le1a/

#3 Mr! Ni hi/ =ats Bache/or in La" ' ?ears Le1a/

## Ms! Nee/am Bache/or in La" ?ears Le1a/

#' Ms! Moon Rana Bache/or in La" ' ?ears Le1a/

More than #. other Professiona//( a/ified S **ort Staff


6/75

DOING BUSINESS ININDIA


7/75

6OREIGN DIRECT IN=ESTMENT ININDIA

AUTOMATIC ROUTE

APPRO=AL ROUTE


8/75

ENTRY STRATEGY

5OINT =ENTURE

W:OLL? OWNED SUBSIDIAR?

BRANC: O66ICE

AGENC?


9/75

6ORMS O6 ENTERPRISES IN INDIA

INCORPORATED ENTIT?Pri+ate Limited Com*an(

P


10/75

T?PE O6 SECURITIES

E8 it( Share

Preference Share

De


11/75

LAWS GO=ERNING BUSINESS ININDIA

The Com*anies Act! #$.Ar


12/75

IMPORTANT REGULATOR?AUT:ORITIES 6OR 6OREIGNIN=ESTMENT

Secretariat for Ind stria/ Assistance &SIA)

6orei1n In+estment Promotion Board &6IPB)

The 6orei1n In+estment Im*/ementation A thorit( &6IIA)

Reser+e Ban of India &RBI)

Re1istrar of Com*anies &RoC)

Sec rities and E-chan1e Board of India &SEBI)

Centra/ Board of E-cise and C stoms &CBEC)

Centra/ Board of Direct Ta-es &CBDT)

A thorit( for Ad+ance R /in1s &AAR)

In+estment Commission


13/75

DIRECT TA>ES

INCOME TA>

DI=IDEND DISTRIBUTION TA>


14/75

INDIRECT TA>C stoms d t(

CEN=AT &e-cise d t()

Centra/ Sa/es ta-

=a/ e added ta-

Ser+ice ta-

Octroi d t(Hentr( ta-

Stam* D t(

R2D cess

Wor s contract ta-

T rno+er ta-

P rchase ta-

Secondar( and hi1her ed cation cess


15/75

INTERNATIONAL TA> TREATIES

Treaties "ith fa+ora


16/75

IMPORTANT :R STATUTES

TRAINING, RECRUITMENT AND SCREENING

Em*/o(ment e-chan1es &Com* /sor( notification of+acancies) act, #$.$

The *a(ment of 1rat it( act, #$F'

The a**rentices act, #$ #

Contract /a


17/75

EMPLO?MET TERMS, CONDITIONS AND BENE6ITS

6actories act, #$ %

Sho*s and commercia/ esta


18/75

INTELLECTUAL PROPERT?

Patents

Co*( Ri1hts

Trade Mar s

Trade Secretes

Geo1ra*hica/ indication of 1oods


19/75

ACCOUNTS AND AUDIT

Indian Acco ntin1 Standards

A dit and Ass rance Standards

G idance notes

Standards on interna/ a dit

O*inion of e-*ert ad+isor( of ICAI

I6RS to


20/75

REPORTINGRE UIREMENTS


21/75

INCOME TA>

Ann a/ Ta- Ret rn

arter/( "ithho/din1 ta- ret rn

Acco ntant re*ort nder of transfer *ricin1 r /e

Ta- a dit re*ort

Acco ntant re*ort in case of MAT

Acco ntant re*ort in case of STPIHEOUHSE@


22/75

COMPAN? LAW

6i//in1 of ann a/ a dited financia/ statements

6i//in1 of ann a/ ret rn

6i//in1 of doc ments in case of

Chan1e of DirectorChan1e of Ca*ita/Chan1e of Re1istered OfficeRe1istration of Char1e


23/75

E>C:ANGE CONTROL LAWHRBI

Intimation to RBI from recei*t of ca*ita/

Intimation to RBI from the date of a//otment of shares

Ann a/ ret rn to RBI


24/75

SER=ICE TA> LAW

Month/( de*osit of ta-

:a/f (ear/( ta- ret rn

Ref nd of Ser+ice Ta- "ithin # (ear


25/75

STPI

Month/( *ro1ress re*ort

Ann a/ ret rn

6i//in1 of Softe- form

Reim< rsement of CST on ha/f (ear/(


26/75

=ATHCST

Month/(H arter/( ret rn

Ann a/ ret rn


27/75

E>TRACTION O6 EARNINGS OUTO6 INDIA

Di+idend

B (


28/75

E>IT STRATEG?

Disso/ tion of com*an(

Sa/e of share

Mer1erHAma/1amation

IPO


29/75

INCOME TA> LAW AT A

GLANCEIN

INDIA


30/75

INCOME TA> AT A GLANCE

C:ARGEABILIT?

Income arisin1 or accr in1 or recei+in1 in India inc/ din1s*ecified deemin1 income

TA> RULE

Resident R /eSo rce R /e

TA> PA?ER T?PE

Residents

Non ResidentsResident < t not Ordinari/( Resident

COND Ne-t S/ide


31/75

SCOPE

Wor/d"ide Income Ta-a


32/75

E>EMPTIONS AND DEDUCTIONS

=ario s s*ecified e-em*tions and ded ctions are a//o"ed PA?MENT Se/f Assessment &at the time of fi/in1 ta- ret rn)Ad+ance Ta- & to insta//ments on estimated


33/75

ASSESSMENT PROCEDURE

Acce*ted as s ch &If not se/ected for a dit "ithin si- months from the end of AH? )Se/ected for Scr tin( &A dit)

TIME PERIOD 6OR ASSESSMENT

# (ear from the end of AH? if not se/ected for A dit' (ears from the end of AH? if se/ected for A dit

REASSESSMENT PROCEDURE

If income esca*ed ta-ation or "ron1 information


34/75

RE=ISION O6 ORDER B? COMMISSIONER

Within ' (ears from the end of the 6H? in "hich order "as*assed

RE=ISION O6 ORDER B? COMMISSIONER I6 TA> PA?ERRE UESTED

Within # (ear from the end of the 6H? in "hich order "as*assed

RE6UND

Ta- *a(er is entit/ed to ref nd of e-cess ta- de*osited "ithinterest J K *er ann m

INTEREST

Interest J #'K *er ann m for de/a( in fi/in1 ret rn, de*osit ofta- etc!


35/75

PENALTIES

Ma-im m 33K of ta- amo nt

PROSECUTION

Wi//f / attem*t to e+ade ta-Wi//f / fai/ re to fi/e ta- ret rnWi//f / fai/ re to fi/e doc ments and acco nts6a/sification of


36/75

Appellant Authorities

There are 4 level of appellant authorities :-1) Commissioner of Income Tax (within Tax dept)2) Income Tax Appellant Tri unal ( !ower Court )

") #i$h Court4) %upreme Court of India


37/75

WEALT: TA>

I6 TA>ABLE WEALT: E>CEEDS RS! MILLION

WEALT: TA> J #!3 K


38/75

INCOME TA> TABLE

Domestic Com*an( !$$K

6orei1n Com*an( '!' K

Di+idend distri< tion ta- # !$$.K

Ca*ita/ 1ains ta- on e-it orrestr ct rin1

3K to '!' K &/on1Hshortterm)

Withho/din1 Ta-es Na11in1 *ro


39/75

NEW DIRECT TA> CODE

TA>ATION O6 COMPANIES

Com*anies '.K Branch *rofit ta- #.K

GAAR Introd ce

Treat( O+erride Introd ced

Short TermHLon1 Term Ca*ita/ 1ains J 3K

Residence r /e for com*anies P/ace of contro/ andmana1ement, "ho//( or *art/( in India, at an( time in the(ear

Wea/th ta- J 3!'.K &


40/75

TA> RATE COMPARISION

Cor*orate Income

Ta- Rate

3K '.K

Minim mA/ternati+e Ta-

#.K &of


41/75

INTERNATIONAL TA>ATIONAT A

GLANCE

INTERNATIONAL TA> AT A


42/75

INTERNATIONAL TA> AT AGLANCE

A// *a(ments in the nat re of char1ea


43/75

DOUBLE TA>ATION TREAT?BETWEEN INDIA 2 USA

RATE

DI=IDEND NIL

INTEREST #3 #.K

RO?ALT? #3K in case of se of Ind stria/, Commercia/

and Scientific E8 i*ment #.K if *a(er is Go+ernment or S*ecified

Or1ani ation'3K in other Cases

6EE 6OR INCLUDED #3K in case of se of Technica/ or Cons /tin1

SER=ICES Ser+ices, Anci//ar( 2 S


44/75

TRANS6ER PRICING LAW

IN INDIA


45/75

INTRODUCTION TO TRANS6ERPRICING

+n +ndia, Transfer ricing reg lations )ere introd ced fro' ./ril 1,2001as a 'eas re to c r# ta! a oidance*

.n +nco'e arising fro' an international transaction to #e co'/ tedat the arm0s /en1th *rice &ALP)!

The Central oard of irect Ta!es has set / a se/arate cell for dealing)ith cases of transfer /ricing

SOURCE

O&C g idelines

4S reg lations and ris/r dence

+ndian ris/r dence


46/75

ARM0S LENGT: PRINCIPLE

7 here an enter/rise enters into transactions )ith associated enter/rises, in order to deter'ine fair /rofit of that enter/rise, the /rice of the transactions sho ld #e co'/ared )ith those entered into # t)o inde/endent enter/rise nder ncontrolled conditions and nder si'ilar circ 'stances*7


47/75

APPLICABILIT?

INTERNATIONAL TRANSACTIONS

ASSOCIATED ENTERPRISES


48/75

P rchase

Sa/e

Lease of tan1i


49/75

ASSOCIATED ENTERPRISES

PRIMAR? ASSOCIATION

"anage'ent8Control8Ca/ital

SECONDAR? ASSOCIATION

Direct or indirect +otin1 *o"er of at /east ' K

Common *arent ho/ds +otin1 *o"er of at /east ' K in


50/75

STEPS 6OR DETERMINATION O6ALPSTEPS IN=OL=ED IN T:E DETERMINATION O6 T:E ALP

+dentification of the 7Internationa/ Transaction9

+dentification of an 7Uncontro//ed Transaction9

+dentification and co'/arison of s/ecific characteristics of the t)otransactions &Com*ara


51/75

MET:ODS The s*ecific methods *rescri


52/75

TRADITIONAL TRANSACTIONMET:OD

COMPARABLE UNCONTROLLED PRICE MET:ODUnder this method, the first ste* is to identif( the *rice char1ed or*aid for *ro*ert( transferred or ser+ices *ro+ided in a com*ara


53/75

enter*rise in connection "ith the said transaction! Then s ch *riceis to


54/75

TRANSACTIONAL PRO6IT MET:ODPRO6IT SPLIT MET:ODUnder this method, the first ste* is to determine the com


55/75


56/75

SUMMAR? O6 MET:ODSMethods Prod ct

Com*ara


57/75

SELECTION O6 MOSTAPPROPRIATE MET:OD

T:E MOST APPROPRIATE MET:OD S:ALL BE SELECTED :A=ING REGARD

TO T:E 6OLLOWING

The nat re and c/ass of the internationa/ transaction

The c/ass or c/asses of associated enter*rise enterin1 into thetransaction and the f nctions *erformed


58/75

COMPARABILIT? 6ACTORS6OR COMPARING AN INTERNATIONAL TRANSACTION WIT: ANUNCONTROLLED TRANSACTION, RE6ERENCE S:OULD BE MADE TOT:E 6OLLOWING

The s*ecific characteristics of the *ro*ert( transferred or ser+ices*ro+ided in either transaction

The f nctions *erformed, ta in1 into acco nt assets em*/o(ed orto


59/75

TRANS6ER PRICING AUDIT

Limit of Rs! . Crores has


60/75

ASSESMENT PROCEDURE 6i/e ta- ret rn 2 Acco ntant0s Re*ort & 3th Se*tem


61/75

REPORTING RE UIREMENTS

& er ta! /a er entering into international transaction to o#tainedan acco ntant re/ort in /rescri#ed for' i*e* For' 3C& *

& er acco ntant re/ort to #e s #'itted on or #efore the d e datefor filing ta! ret rn

.cco ntant re/ort contain the follo)ing infor'ation

Contains s mmar( of internationa/ transaction

Contains detai/s of ta- *a(er

Contains method em*/o(ed to determine ALP

DOCUMENTATION


62/75

DOCUMENTATION ENTIT? RELATED PRICE RELATED TRANSACTION

RELATEDProfi/e of ind str(

Profi/e of 1ro *

Profi/e of Indian

entit(

Profi/e ofassociatedenter*rises

Transaction terms

6 nctiona/ ana/(sis&f nctions, assetsand ris s)

Economic ana/(sis&method se/ectin1,com*ara


63/75

PENALT?

DE6AULT NATURE O6 PENALT?

In case of a *ost in8 ir(ad; stment, there is deemed to


64/75

4E? ISSUESHCONTRO=ERS?Use of secret com*ara


65/75

TA4E AWA?Ad; stment a//o"ed

Wor in1 ca*ita/Ris sGro"thIPUnder ti/i ation of ca*acit(

Difference in acco ntin1 *o/icies

Loss ma in1 com*ara


66/75

Se1menta/ res /ts to


67/75

RESOLUTION PROCESS

TransferPricin1 Officer

Dis* teReso/ tion

Pane/

A**e//ateTri< na l :i1h Co rt S *remeCo rt

Order /assed)ithin 1 'onthfro' end of the'onth in )hichdirection fro'is/ te

Resol tion anelis recei ed orend of 9 'onthfro' the end of'onth in )hichdraft order isfor)arded*

irection to#e iss ed)ithin 9'onth fro'the end of the'onth in)hicho# ection arefor)arded

Final factfindinga thorit

o s/ecificti'e li'it

;enerallorder/assed)ithin 2 < %ears fro'filing ofa//eal

Re en ecan also goon a//eal ifCo''issioner decidesin fa or of

Final fact findinga thorit

o s/ecific ti'eli'it

;enerall order/assed )ithin 2

Readymade Companies in India

Documents

Transcript of Readymade Companies in India