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Key Takeaways From Budget 2023-24 For Tax Payers

by InCorp Advisory

Reading Time: 5 minutes

The Union Budget 2023-24 presents a range of tax provisions aimed at boosting the economy and providing relief to taxpayers. The Union Budget 2023-24 proposes changes to the personal income tax structure, rationalization of tax exemptions, and simplification of tax compliance. Additionally, the budget proposes several measures to promote the growth of the agricultural and small business sectors and to enhance the ease of doing business. Overall, the tax provisions in the Union Budget 2023-24 aim to provide a balanced approach to economic growth and fiscal stability, while ensuring that taxpayers receive the support, they need to achieve their financial goals. In this blog, we will highlight the key takeaways from Union Budget 2023-24 for taxpayers and what has brought about significant changes in the Direct Tax & Indirect Tax provisions.

Direct Tax Provisions

A direct tax is a tax that is paid directly by an individual or organization to the government and cannot be shifted to someone else. Direct taxes are typically based on a person’s income, wealth, or property and are usually progressive, meaning the more one earns, the higher the tax rate. Following are the direct tax provision made in Union Budget 2023-24.

Tax Rates

Changes in personal taxation slab rates for FY 2023-24 under 'New Income Tax Regime’

  • New Tax Regime shall operate as a Default regime instead of the Old Regime. However, still, the taxpayer shall have the ion to opt for Old Regime
  • Changes in personal taxation slab rates for FY 2023-24 under ‘New Income Tax Regime’:
  • Rebate limit for income budget increased from INR 5,00,000 to INR 7,00,000 under New Tax Regime 
  • Highest surcharge rate was reduced to 25% from 37% in the new regime 
  • Benefit of Newly Incorporated Co-Operative Society engaged in manufacturing shall be taxable at 15% on par with Private Companies 
  • In case an application for renewal of Charitable Trust is not made in Time, Exit Tax shall be applicable under 115TD 

TDS /TCS

  • TDS on income from online gaming will be taxed at 30% with no threshold limit
  • Threshold limit for cooperative society to withdraw cash without TDS increased to INR 3 crores

Startups

  • Date of incorporation for startups to avail of income tax benefits extended to 31-03-2024
  • The benefit of carrying forward losses on change in shareholding of startups has been increased to 10 years from 7 years

Business Re-organization

  • In case of business re-organization where the return is filed by a successor, the successor shall modify the return within six months

Small Business/MSMEs

  • Small businesses having a turnover up to INR 3 Crores (INR 2 Crores Earlier) can opt for the presumptive scheme and similarly professionals having a turnover up to INR 75 Lakhs (INR 50 Lakhs Earlier) can opt for the presumptive scheme, provided gross receipts in cash does not exceed 5% of Gross Turnover
  • Expenses on account of services availed from MSME shall be allowed only on a payment basis

Rationalization in Tax Provision

  • Special audit of inventory in the books u/s 142(2A) along with audit of books of accounts
  • De-criminalization of three Offences w.e.f. 01st April 2023.

Indirect Tax Provisions

An indirect tax is a tax that is collected by an intermediary, such as a retailer or manufacturer, from the person who ultimately bears the economic burden of the tax. The intermediary then remits the tax to the government. Indirect taxes are typically levied on the sale or provision of goods and services, and the burden of the tax is passed on to the final consumer in the form of a higher price. Following are the indirect tax provision made in Union Budget 2023-24.

Related Read: BUDGET 2023 – GST, Customs, Excise Duty Highlights

CLICK HERE

GST

Relief in GST Provisions

  • Prosecution under CGST Act for tax amount increased from INR 1Crore to INR 2 crores (exception for invoicing without supply)
  • Decriminalization of certain offences under the CGST Act related to obstruction of duty, tampering of evidence, and failure to supply information
  • Reduction in compounding amount from the present range of 50 to 150 per cent of tax amount to the range of 25 to 100 per cent
  • Amendments proposed in Section 10 of the CGST Act to enable unregistered suppliers and composition taxpayers to make the intra-state supply of goods through E-Commerce Operators (ECOs), subject to certain conditions

Rationalization in GST Law

  • Input tax credit not available for expenditure related to CSR
  • Insertion of new Section 158A in CGST Act for sharing of information on the common portal
  • Amendment to the definition of “non-taxable online recipient” and “online information and database access or retrieval services” in the IGST Act
  • In cases of transport supplier and recipient are both located in India for transportation of goods outside India, the place of supply will be considered as a place of the recipient and not the destination of goods
  • Restriction of return filing under GST to a maximum of 3 years from the due date

Customs

Rate changes in Customs (to be effective from 02.02.2023) 

Agricultural Products and By-Products

  • Pecan nuts: 100% to 30%

Chemicals – BCD on:

  • Denatured ethyl alcohol: 5% to Nil
  • Acid grade fluorspar: 5% to 2.5%
  • Crude glycerin: 7.5% to 2.5%
  • Naphtha: 1% to 2.5%
  • Styrene & Vinyl Chloride Monomer from 2% to 2.5%

Rubber

  • Rate increased for Compounded Rubber from 10% to 25% or INR 30 per kg., whichever is lower

Electronics Goods

  • Camera lens and its inputs/parts for camera module of cellular mobile phone: 2.5% to Nil
  • Specified chemicals/items for Pre-calcined Ferrite Powder: 7.5% to Nil
  • Palladium Tetra Amine Sulphate: 7.5% to Nil
  • Specified parts for manufacture of an open cell of TV panel: 5% to 2.5%

Electrical Appliances

  • Rate increased for Electric Kitchen Chimney from 7.5% to 15%
  • Heat Coil (used in the manufacture of Electric Kitchen Chimneys): 20% to 15%

Automobiles

  • New or retreaded pneumatic tyres of rubber tax rate reduced from 3% to 2.5%
  • Base metals clad with silver, gold (including gold plated with platinum), platinum, base metals, silver, or gold, clad with platinum, waste and scrap of precious metal, coin tax rate reduced from 12.5% to 10%
  • Vehicle (including electric vehicles) in Semi-Knocked Down (SKD) form: 30% to 35%
  • Vehicle in Completely Built Unit (CBU) form (other than with CIF more than USD 40,000 or with engine capacity of more than 3000 ccs for petrol-run vehicles and more than 2500 cc for diesel-run vehicles, or with both): 60% to 70%

Specified Capital Goods

  • Import of Specific capital goods/machinery for the manufacture of Lithium-ion cells, used in batteries of electrically operated vehicles (EVs): Nil to Nil (no change)

Export Promotion

BCD on certain ingredients/inputs for use in the manufacture of aquatic feed is being reduced subject to IGCR conditions as follows:

  • Fish lipid oil & Algal Prime (flour): 30% to 15%
  • Fish meal, Mineral and Vitamin Premixes & Krill Meal, : 15% to 5%

Precious Metals

  • Rate increased for articles of precious metals from 22% to 25%
  • Rate of Imitation Jewellery increased from earlier 22% or INR 400 per kg., whichever is higher to 25% or INR 600 per kg., whichever is higher

Others

  • Rates on Toys and parts of toys (other than parts of electronic toys) increased from 60% to 70%
  • Aircraft (other than those Nil or 2.5%) and other aircraft tyres (other than Nil) rates reduced from 3% to 2.5%; also attracts AIDC of 0.5%
  • Rates on Bicycles increased from 30% to 35%
  • BCD on coal, peat and lignite is being increased to 2.5% but exempted from AIDC

Related Read: Union Budget 2023-24 – GIFT City IFSC

CLICK HERE

Conclusion

In conclusion, the Union Budget 2023-24 presents a well-rounded approach to boosting the economy while providing relief to taxpayers. The proposed changes to personal income tax, tax exemptions, and compliance simplify the process and provide support to achieve financial goals. The measures to promote agriculture and small business growth, along with the ease of doing business, highlight the government’s commitment to balanced economic growth and fiscal stability. Overall, the Union Budget 2023-24 offers positive takeaways for taxpayers and has brought about significant changes in Direct and Indirect Tax provisions that are set to benefit the economy and its citizens.

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BUDGET 2023 – GST, Customs, Excise Duty Highlights

by InCorp Advisory

Reading Time: 17 minutes

Union Budget 2023, Finance Minister – Nirmala Sitharaman announced certain provisions and amendments in the rates of indirect taxes under Customs, Excise Laws. We have tabulated the same for your convenience below:

RATE CHANGES

Tariff Rate Changes
A. Increasein Tariff rate (to be effective from 02.02.2023) Rate of Duty
S. No. HSN Code Commodity From To
Chemicals
1. 2902 50 00 Styrene 2% 2.5%
2. 2903 21 00 Vinyl Chloride Monomer 2% 2.5%
Rubber
3. 4005 Compounded Rubber 10% 25% or Rs. 30 per kg., whichever is lower
Gems and Jewellery Sector
4. 7113, 7114 Articles of precious metals 20% 25%
5. 7117 Imitation Jewellery 20% or Rs.400 per kg., whichever is higher 25% or Rs.600 per kg., whichever is higher
Electrical Goods
6. 8414 60 00 Electric Kitchen Chimney 7.5% 15%
Automobiles and Toys
7. 8712 00 10 Bicycles 30% 35%
8. 9503 Toys and parts of toys (other than parts of electronic toys) 60% 70%
B. Tariff rate changes (without any changes to the effective rate of Customs Duty) Rate of Duty
S. No. HSN Commodity From To
1. 4011 30 00 New or retreaded pneumatic tyres, of rubber , of a kind used on aircraft of heading 8802 3% 2.5%
2. 7107 00 00 Base metals clad with silver, not further worked than semi- manufactured 12.5% 10%
3. 7108 Gold (including gold plated with platinum) unwrought or in semi- manufactured forms, or in powder form 12.5% 10%
4. 7109 00 00 Base metals or silver, clad with gold, not further worked than semi- manufactured 12.5% 10%
5. 7110 11 10

7110 11 20

7110 19 00

7110 21 00

7110 29 00

7110 41 00

7110 49 00

 Platinum,  unwrought  or in semi-manufactured form, or in powder form 12.5% 10%
6. 7111 00 00 Base metals, silver or gold, clad with platinum, not further worked than semi- manufactured 12.5% 10%
7. 7112 Waste and scrap of precious metal or of metal clad with precious metal; other waste and scrap containing precious metal or precious metal compounds, of a kind usedprincipally for the recovery of precious metal other than goods of heading 8549 12.5% 10%
8. 7118 Coin 12.5% 10%
9. 8802 20 00

8802 30 00

8802 40 00

 Aero planes and other aircrafts 3% 2.5%
C. Tariff rate changes (with changes to the effective rate of Customs Duty) Rate of duty
1. 7106 Silver (including silver plated with gold or platinum), unwrought or in semi-manufactured forms, or in powder form 12.5% 10%

OTHER PROPOSALS INVOLVING CHANGES IN BASIC CUSTOMS DUTY RATES IN NOTIFICATIONS

A. Changes in Basic Customs Duty (to be effective from 02.02.2023) Rates of Duty
S. No Chapter, Heading, sub- heading, tariff item Commodity From To
Agricultural Products and By Products
1. 0802 99 00 Pecan nuts 100% 30%
2. 1504 20 Fish lipid oil for use in manufacture of aquatic feed 30% 15%
3. 1520 00 00 Crude glycerin for use in manufacture of Epichlorohydrin 7.5% 2.5%
4. 2102 20 00 Algal     Prime    (flour)     for    use             in manufacture of aquatic feed 30% 15%
5. 2207 20 00 Denatured ethyl alcohol for use in manufacture of industrial chemicals 5% Nil
6. 2301 20 Fish meal for use in manufacture of aquatic feed 15% 5%
7. 2301 20 Krill meal for use in manufacture of aquatic feed 15% 5%
8. 2309 90 90 Mineral and Vitamin Premixes for use in manufacture of aquatic feed 15% 5%
Minerals
9. 2529 22 00 Acid grade fluorspar (containing by weight more than 97% of calcium fluoride) 5% 2.5%
Petrochemicals
10. 2710 12 21,

2710 12 22,

2710 12 29

 Naphtha 1% 2.5%
Gems and Jewellery Sector
11. 7102, 7104 Seeds for use in manufacturing of rough lab-grown diamonds 5% Nil
12. 7106 Silver (including silver plated with gold or platinum), unwrought or in semi- manufactured forms, or in powder form 7.5% 10%
13. 7106 Silver Dore 6.1% 10%
IT, Electronics
14. 25, 28, 32,

39, 40, 69,

73, 85

 Specified chemicals/items for manufacture of Pre-calcined Ferrite Powder 7.5% Nil
15. 3824 99 00 Palladium Tetra Amine Sulphate for manufacture of parts of connectors 7.5% Nil
16. Any Chapter Camera lens and its inputs/parts for use in manufacture of camera module of cellular mobile phone 2.5% Nil
17. 8529 Specified parts for manufacture of open cell of TV panel 5% 2.5%
Electronic appliances
18. 8516 80 00 Heat Coil for use in the manufacture of Electric Kitchen Chimneys 20% 15%
Automobiles
19. 8703 Vehicle (including electric vehicles) in Semi-Knocked Down (SKD) form . 30% 35%
20. 8703 Vehicle in Completely Built Unit (CBU) form , other than with CIF more than USD 40,000 or with engine capacity more than 3000 cc for petrol- run vehicle and more than 2500 cc for diesel-run vehicles, or with both 60% 70%
21. 8703 Electrically operated Vehicle in Completely Built Unit (CBU) form, other than with CIF value more than USD 40,000 60% 70%
22. 39,40,58,70,

72

73,83,84,85,

87,90

 Vehicles,            specified automobile parts/components, sub-systems and tyres when imported by notified testing agencies for the purpose of testing and/ or certification , subject to conditions As applicable Nil
Capital goods
23. 84, 85 Specific capital goods/machinery for manufacture of Lithium ion cell for use in battery of electrically operated vehicle (EVs) As applicable Nil
B. Changes in Basic Customs Duty (without any change in the effective rate of Customs Duties i.e., BCD+AIDC+SWS) Rate of Duty
S. No HSN Commodity From To
1. 2701, 2702,

2703

 Coal, peat, lignite 1% 2.5%
2. 7108 Gold (including gold plated with platinum) unwrought or in semi- manufactured forms, or in powder form 12.5% 10%
3. 7108 Gold Dore 11.85% 10%
4. 7110 11 10

7110 11 20

7110 19 00

7110 21 00

7110 29 00

7110 41 00

7110 49 00

 Platinum, unwrought or in semi- manufactured form, or in powder form other than those used in manufacture of noble metal compounds, noble metal solutions and catalytic converters 12.5% 10%
C. Change in end date of exemption (No change in effective rate of duty). Rate of duty
S. No S. No in Notification no 50/2017- Customs Commodity From To
1 368 Ferrous waste and scrap Nil Nil (up to

31.03.2024)
2 374, 375 Raw materials for use in manufacture of CRGO steel Nil Nil (up to

31.03.2024)
3 527A Lithium-ion cell for use in the manufacture of battery or battery pack of cellular mobile phone 5% 5%

(up to 31.03.2024)
4 527B Lithium-ion cell for use in the manufacture of battery or battery pack of electrically operated vehicle (EVs) or hybrid motor vehicle 5% 5%

(up to 31.03.2024)
5 168 Specified inputs and sub-parts for use Nil Nil
in manufacture of telecommunication grade optical fibre or optical fibre cables (up to 31.03.2025)
6 341 Preform of silica for use in the manufacture of telecommunication grade optical fibres or optical fibre cables 5% 5%

(up to 31.03.2025)
7 341A Inputs for manufacture of Preform of silica Nil Nil (up to

31.03.2025)
8 237 Specified inputs for use in the manufacture of EVA sheet or back sheets which are used in the manufacture of solar cell or modules Nil Nil (up to

31.03.2024)
9 340 Solar tempered glass for use in the manufacture of solar cell or solar module Nil Nil (up to

31.03.2024)
10 405, 406 Raw materials and parts for manufacture of wind operated electricity generators, including permanent magnets for manufactureof PM synchronous generators above 500KW for use in wind operated electricity operators 5% 5%

(up to 31.03.2025)
 

11.

 559 Raw material and parts (including Dredger) for use in the manufacture of ships/vessels Nil Nil (up to

31.03.2025)
12 166 Specified Drugs, medicines, diagnostics kits or equipment, bulk drugs used in manufacture of drugs or medicines 5% 5%

(up to 31.03.2025)
13 167 Lifesaving drugs/ medicines and diagnostic test kits, bulk drugs used in manufacture of life-saving drugs or medicines Nil Nil (up to

31.03.2025)

Review of customs duty concessions/ exemptions:

Review of conditional exemption rates of BCD prescribed in notification No. 50/2017 – customs dated 30.6.2017:

The BCD exemption for the goods covered under following serial numbers of the notification are being extended for a period of one year i.e. upto 31st March 2024, unless specified otherwise.

S. No. Sr. No. of Not. Description
1. 90 Lactose for use in the manufacture of homeopathic medicine
2. 133 Gold ores and concentrates for use in manufacture of Gold
3. 139 Specified bunker Fuel for use in ships or vessels
4. 150 Goods of Heading 2710 or 271490 for manufacture of Fertilisers
5. 155 Excess Liquefied petroleum gases (LPG) returned by DTA unit to SEZ unit
6. 164 Electrical energy supplied to DTA by power plants of 1000MW or above
7. 165 Electrical energy supplied to DTA by power plant less than 1000MW
8. 183 Medical use fission Molybdenum-99 (Mo-99) for use in manufacture of radio pharmaceutical
9. 184 Pharmaceutical Reference Standard
10. 188 Specified goods for manufacture of ELISA Kits
11. 204 Anthraquinone or 2-Ethyl Anthraquinone, for use in manufacture of Hydrogen Peroxide
12. 212A Medicines/drugs/vaccines supplied free by United Nations International Children’s Emergency Fund (UNICEF), Red Cross or an International Organization
13. 213 Drugs and materials
14. 238 Organic or inorganic coating material for manufacture of electrical steel
15. 253 Goods for manufacture of Brushless Direct Current (BLDC) motors
16. 254 Catalyst for manufacture of cast components of Wind Operated Electricity Generator
17. 255 Resin for manufacture of cast components of Wind Operated Electricity Generator
18. 258 Security fibre, security threads, Paper based taggant including M-feature for manufacture of security paper by Security Paper Mill, Hoshangabad and Bank Note Paper Mill India Pvt Ltd, Mysore.
19. 259 Raw materials for manufacture of security fibre and security thread for supply to Security Paper Mill, Hoshangabad and Bank Note Paper Mill India Pvt. Ltd, Mysore for use in manufacture of security paper
20. 260 Goods for the manufacture of orthopaedic implants falling under 902110
21. 261 Alatheon and copper wire
22. 269 Super absorbent polymer for manufacture adult diapers, tampons, sanitary pads etc (9619)
23. 271 Polytetrametylene ether glycol, (PT MEG) for use in manufacture of spandex yarn
24. 276 Ethylene – propylene – non-conjugated diene rubber (EPDM) for manufacture of insulated wires and cables
25. 277A Calendared plastic sheet for manufacturing of Smart Card (8523)
26. 279 Pneumatic tyres of rubber for MRO of aircraft used in scheduled air service
27. 280 Pneumatic tyres of rubber for MRO of aircraft used by training, aeroclub etc.
28. 333 Moulds,         tools    and      dies      for       manufacture   of         parts of          electroniccomponents/equipment
29. 334 Graphite        Felt      or         graphite          pack     for       growing silicon ingots;Thin steel wire used in wire saw for slicing of silicon

wafers
30. 339 Toughened glass for solar thermal collectors or heaters
31. 353 Foreign currency coins when imported into India by a Scheduled Bank
32. 364A Spent catalyst or ash containing precious metals
33. 378 Metal parts for manufacture of electrical insulators falling under heading 8546
34. 379 Pipes and tubes for use in manufacture of boilers
35. 380 Forged steel rings for manufacture of special bearings for use in wind operated electricity generator
36. 381 Flat copper wire for use in the manufacture of photo voltaic ribbon for solar cell/modules
37. 387 Zinc metal recovered by toll smelting or toll processing from zinc concentrates exported from India for such processes
38. 392 Dies for drawing metal, when imported after repairs in exchange ofsimilar worn out dies exported out for repairs
39. 415 Parts/inputs for manufacture of catalytic convertors or its parts
40. 415A Platinum or Palladium for manufacture of all goods including Noble Metal Compounds & Noble Metal Solutions falling under 2843 and goodsof

heading 381512
41. 416 Ceria zirconia compounds for use in the manufacture of washcoat for catalytic converters
42. 417 Cerium compounds for use in the manufacture of washcoat for catalytic converters
43. 418 Zeolite for use in the manufacture of washcoat for catalytic converters
44. 419 Aluminium Oxide for use in the manufacture of washcoat for catalytic converters
45. 420 Clay 2 Powder (Alumax) for use in ceramic substrate for catalytic convertors
46. 421 Goods required for basic telephone /internet service and their parts
47. 426 Specified goods for the manufacture of goods falling under 8523 5200, 8541, 8542, 8543 9000 or 8548 00 00
48. 428 Specified goods imported by accredited press cameraman
49. 429 Specified goods, imported by accredited journalist
50. 435 Capital goods/ Machinery for printing industry
51. 441 Spinnerettes made interalia of Gold, Platinum and Rhodium or any one or more of these metals, when imported in exchange of worn out or damaged

spinnerettes exported out of India
52. 462 Ball screws for use in the manufacture of CNC Lathes, Machining Centres or all type of CNC machine tools falling under 8456 to 8463
53. 463 Linear Motion Guides for use in the manufacture of CNC Lathes,

Machining Centres or all type of CNC machine tools falling under 8456 to 8463
54. 464 CNC Systems for use in the manufacture of CNC Lathes, Machining Centres or all type of CNC machine tools falling under 8456 to 8463
55. 467 Cash dispenser and parts thereof
56. 468 Micro ATM; fingerprint reader/scanner other than for use in manufacturing cellular mobile phones; miniaturized POS card reader for mPOS (other than Mobile phone or Tablet Computer); parts and components for

manufacture of the above items
57. 471 All parts for use in the manufacture of LED lights or fixtures including LED lamps
58. 472 All inputs for use in the manufacture of LED driver or MCPCB for LED lights and fixtures or LED lamps
59. 475 Specified goods including scramblers, descramblers, encoders, jammers, network firewall, SMS monitoring system etc
60. 476 Television equipment, cameras and other equipment for taking films, imported by a foreign film unit or television team
61. 477 Photographic, filming, sound recording and radio equipment, raw films, video tapes and sound recording tapes of foreign origin if imported into

India after having been exported therefrom.
62. 478 The wireless apparatus, parts imported by a licensed amateur radio operator
63. 480 Goods imported for being tested in specified test centers
64. 482 Newspaper page, transmission and reception facsimile system or equipment; telephoto transmission and reception system or equipment
65. 489B Specified goods for manufacturing of microphones
66. 495 Batteries for electrically operated vehicles, including two and three wheeled electric motor vehicles
67. 497 Active Energy Controller (AEC) for use in manufacture of Renewable Power System (RPS) inverters
68. 504 Parts and Components of Digital Still Image Video Cameras
69. 509 Parts, components and accessories for manufacture of Digital Video Recorder /Network Video Recorder (NVR) falling under 85219090 and
sub-parts for manufacture of these items
70. 510 Parts, components and accessories for use in manufacture of reception apparatus for television and sub-parts for manufacture of these items
71. 511 Parts, components and accessories for manufacture of CCTV Camera /IP camera and sub-parts for manufacture of these items
72. 512 Specified Parts, components and subparts for use in manufacture of Lithium-ion battery and battery pack
73. 512A Inputs ,parts or subparts for manufacture of PCBA of Lithium ion battery and battery pack
74. 515A Open cell for use in manufacture of LCD and LED TV panels of heading 8524
75. 516 Specified goods for use in the manufacture of Liquid Crystal Display (LCD) and LED TV panel
76. 519 Raw materials or parts for use in manufacture of e-Readers
77. 523A Parts, sub-parts, inputs or raw material for use in manufacture of Lithium ion cells
78. 527 Lithium ion cell used in manufacture of battery or battery pack of items other than cellular mobile phone, electrically operated vehicle or hybrid

motor vehicle
79. 534 Parts of gliders or simulators of aircrafts (excluding rubber tyres and tubes of gliders)
80. 535 Raw materials for manufacture of aircraft (except unmanned aircraft used as television camera, digital camera or video camera recorder) or its parts
81. 535A Components or parts of aircraft for manufacture of aircraft (except unmanned aircraft used as television camera, digital camera or video camera recorder) or for manufacture of parts of aircraft imported by PSUs

under Ministry of Defence
82. 536 Parts, testing equipment, tools and tool-kits for maintenance, repair, and overhauling of aircraft (except unmanned aircraft used as television

camera, digital camera or video camera recorder) or its parts
83. 537 All goods of Heading 8802 (except 88026000-spacecraft)
84. 538 Components or parts, including engines, of aircraft of heading 8802
85. 539 (a) Satellites and payloads; (b) Ground equipments brought for testing of (a)
86. 539A Scientific and technical instruments, apparatus etc required for launch vehicles and satellites and payloads
87. 540 Specified goods under heading 8802           imported by scheduled air transporter
88. 542 Specified goods imported by Aero Club, Flying Training Institutes
89. 543 Specified goods imported by non-scheduled air transporter
90. 544 Parts (other than rubber tubes) of aircraft of heading 8802 for operating scheduled air transport/air cargo services
91. 546 Parts (other than rubber tubes) of aircraft of heading 8802 for non- scheduled passenger/charter services, aero club, training purpose etc
92. 548 Barges or pontoons imported along with ships
93. 549 Capital goods and spares, raw materials, parts, material handlingequipment and consumables for repairs of ocean-going vessels by a ship repair unit
94. 550 Spare parts and consumables for repairs of ocean-going vessels registered in India.
95. 551 Cruise ships, excursion ships (excluding vessels and floating structures imported for breaking up)
96. 553 Fishing vessels, Tugs and Pusher crafts, light vessels (excluding vessels and floating structures imported for breaking up)
97. 555 Vessels such as warships, lifeboats (excluding vessels and floating structures imported for breaking up)
98. 565 Specified goods for use in the manufacture of Flexible Medical Video Endoscope
99. 566 Polypropylene, Stainless-steel Strip and stainless steel capillary tube for manufacture of syringes, needles, catheters and cannulae
100. 567 Stainless steel tube and wire, cobalt chromium tube, Hayness alloy-25 and polypropylene mesh required for manufacture of coronary stents / coronary

stent system and artificial heart valve
101. 568 Parts and components required for manufacture of Blood Pressure Monitors and blood glucose monitoring system (Glucometers)
102. 569 Ostomy products, its accessories and parts required for manufacture of such medical equipment
103. 570 Medical and surgical instruments, apparatus and appliances includingspare parts and accessories thereof
104. 575 Hospital Equipment (excluding consumables) for use in specifiedhospitals
105. 577 Lifesaving medical equipment including accessories or spare parts or both of such equipment for personal use
106. 578A Raw materials, parts or accessories for manufacture of Cochlear Implants
107. 579 Survey (DGPS) instruments, 3D modeling software cum equipment for surveying and prospecting of minerals
108. 580 X-Ray Baggage Inspection Systems and parts thereof
109. 581 Portable X-ray machine / system
110. 583 Parts and cases of braille watches, for the manufacture of Braille watches
111. 593 Parts of video games for the manufacture of video games
112. 607 Specified Life Saving drugs/medicines including medicines for Spinal Muscular Atrophy or Duchenne Muscular Dystrophy, for personal use
113. 607A Lifesaving drugs/medicines for personal use supplied free of cost byoverseas supplier
114. 611 Archaeological specimens, photographs, plaster casts or antiquities for

exhibition for public benefit in a museum managed by ASI or by State Govt.
115. 612 Specified raw material for sports goods

The BCD exemption for the goods covered under following serial number of the notification no 50/2017-Customs is being extended for a period of five years i.e. upto 31st March 2028.

S. No. S. No. of Notfn. Subject
1. 609 Used bonafide personal and household effects of a deceased person

Review of exemptions prescribed by other notifications:

The BCD exemptions for the goods covered under following notifications are being extended for a period of one year i.e. upto 31st March 2024.

S. No. Notification No. Subject
1. 16-Customs dated 23.1.65 Exemption to goods exported to foreign countries for display in show- rooms of Govt of India
2. 80/1970-

Customs

 Exemption to articles supplied free under warranty as replacement for defective ones
3. 46-Customs (1974) Pedagogic material for educational or vocational training courses
4. 248/76-Customs Exemption to precious stones imported by posts on ‘approval or return’ basis
5. 207/89-Customs Exemption to foodstuff and provisions, imported by foreigners
6. 134/94-Customs Exemption to goods for carrying out repairs, reconditions , testing calibration or maintenance
7. 147/94-Customs Exemptions to firearms & ammunition by renowned shot
8. 148/94-Customs Exemptions to specified free gifts, donations, relief and rehabilitation material imported by charitable trusts, Red Cross, CARE and Govt of India
9. 151/94-Customs Exemption to aircraft equipment, tanks, fuel and lubricating oils by Indian Airlines, United Arab Airlines, Indian Air Force
10. 152/94-Customs Exemption to imports for handicapped person, charitable or social
welfare purposes and research and education programme
11. 153/94-Customs Exemption to goods for foreign origin imported for repair and return
12. 39/96-Customs Imports relating to defence, internal security forces& air forces
13. 50/96-Customs Exemption to specified equipment, instruments, raw material etc imported for R&D projects
14. 51/96-Customs Exemption to research equipment by publicly funded and research institutions, Govt. Dept., laboratory, IIT etc
15. 25/98- Customs Effective rate of duty for goods of Chapter 70,84,85 or 90
16. 97/99- Customs Exemption to Gold bars under Gold Deposit Scheme of RBI
17. 113/2003-

Customs

 Exemption to castor oil cake and castor de-oiled cake manufactured from indigenous castor oil seeds on indigenous plant and machineryby

unit in SEZ and brought to DTA
18. 30/2004-

Customs

 Exemptions to second-hand computers/accessories received asdonation by schools, charitable institutions
19. 45/2005-

Customs

 Exemption from Special Additional duty of Customs to goods cleared from SEZ and brought to any other place in India
20. 81/2005-

Customs

 Exemption to machinery/components for initial setting up of non- conventional power generation plants
21. 102/2007-

Customs

 Exemption from Special CVD to all goods imported for subsequentsale when IGST, CGST, SGST or UTGST paid by importers.
22. 26/2011-

Customs

 Exemption to work of art, antiques in museum or art gallery imported for public exhibition
23. 23/2016-

Customs

 Effective rates for parts of aircraft imported under the Standard Exchange Scheme
24. 05/2017-

Customs

 Exemption to machinery, components for setting up fuel cell based power generation plant.
25. 16/2017-

Customs

 Exemption to specified drugs & medicines supplied free of cost to patients under Patient Assistanceprogram of Pharma Companies
26. 29/2017-

Customs

 Exemption to specimen, models, wall pictures and diagrams for instructional purposes
27. 30/2017-

Customs

 Exemption to motion picture, music, gaming software for use ingaming console printed or recorded on media
28. 32/2017-

Customs

 Exemption to art work created abroad by Indian artist, sculptor, antiques books more than 100 years
29. 37/2017-

Customs

 Imports relating to defence & internal security forces
30. 49/2017-

Customs

 Exemption to special Additional Duty on specified goods of fourth schedule to Central Excise Act
31. 52/2017-

Customs

 Effective rate of Additional duty for goods under Chapter 27
1 41/2017-

Customs

 Exemption to import of cups, trophies to be awarded to winning teams in international tournament /world cup to be held in India.
2 33/2017–

Customs

 Exemption to import of challenge cups and trophies won by a unit of Defence Force or its members.
3 146/94–

Customs

 Exemption to imports by specified sports goods imported by National Sports Federation or by a Sports person of outstanding eminence for training.
4 90/2009-

Customs

 Exemption to imports from Antarctica of goods used for or related to Indian Antarctic Expedition or Indian Polar Science Programme.

Other Notification changes

S. No. Notification No. Subject
1. Notification No. 22/2022-

Customs, dated 30.04.2022

 The India-UAE CEPA Tariff notification is being amended as a consequential change to rationalization of basic customs duty rate structure.
2. Notification No. 57/2000-

Customs, dated 08.05.2000

 This notification relating to jewellery export promotion is being amended consequent to changes in import duty structure on Gold and increase in duty rate of Silver.
3. Notification No. 146/94-

Customs, dated 13.07.1994

 Benefit of the existing exemption notification No. 146/94-Customs, dated 13.07.1994, is being extended w.e.f. 02.02.2023 to imports of ‘Warm Blood horse’ when imported by Sportsperson of eminence for training.

Customs duty exemptions /concessions being discontinued

Certain BCD exemptions under notification No. 50/2017-Customs dated 30.6.2017 and other notification are being discontinued with effect from 31.03.2023.
The following are being discontinued as they are redundant :

S. No. S. No. of Notfn Description
1. S. No. 16 of 50/2017-

Customs

 This exemption entry pertaining to ‘Human Embryo’ is being withdrawn as it is redundant on account of prohibition of import of Human Embryo under the Assisted Reproductive Technology (Regulation) Act, 2021 and The Surrogacy (Regulation) Act, 2021. [notification No. 22/2015-20 dated 20th July, 2022 of DGFT refers]
2. S. No. 325 of 50/2017-

Customs

 This exemption entry pertaining to ‘Monofilament Yarn’ is being withdrawn as tariff rate is also at 5% and hence redundant
3. 48/2017-

Customs

 Exemption to catering cabin equipment, food and drinks on re- importation by aircrafts of the Indian Airlines Corporation from foreign flights is being withdrawn.

SOCIAL WELFARE SURCHARGE (SWS)

A. AMENDMENT TO NOTIFICATION NO. 11/2018 – CUSTOMS, DATED 02.02.2018 (w.e.f. 02.02.2023)
S. No. Description
Following goods are being exempted from levy of Social Welfare Surcharge in order to maintain the total effective duty owing to rationalization of basic customs duty rate structure:
1. Silver (HSN 7106), Gold ( HSN 7108) & Imitation Jewellery (HSN 7117).
2. Platinum (HSN 7110) other than rhodium and goods covered under S. Nos. 415(a) and 415A of the Table in notification No. 50/2017-Customs, dated the 30th June, 2017, published in the Gazette of India vide number G.S.R. 785(E), dated the 30th June, 2017.
3. All goods falling under HSN 7113, other than the goods covered under S. Nos. 356, 357 and 364C of the Table in notification No. 50/2017-Customs, dated the 30th June, 2017, published in the Gazette of India vide number G.S.R. 785(E), dated the 30th June, 2017.
4. All goods falling under HSN 7114, other than the goods covered under S. Nos. 356 and 357 of the Table in notification No. 50/2017-Customs, dated the 30th June, 2017, published in the Gazette of India vide number G.S.R. 785(E), dated the 30th June, 2017.
5. Bicycles (HSN 8712 00 10)
6. Motor vehicle including electrically operated vehicles falling under HSN 8703 covered under S. No. 526 (1)(b), 526 (2)(b), 526A(1)(b) and 526A(2)(b) of the Table in Notification No. 50/2017-Customs dated the 30th June, 2017, published in the Gazette of India vide no G.S.R. 785(E) dated the 30th June, 2017
7. Aeroplane and other aircrafts falling under tariff items 8802 2000, 8802 3000 and 8802 4000 covered under S. No. 543 A of the Table in Notification No. 50/2017- Customs dated the 30th June, 2017, published in the Gazette of India vide no

G.S.R. 785(E) dated the 30th June, 2017.
8. Toys and parts of toys (HSN 9503) other than goods covered under S. No. 591of the Table in Notification No. 50/2017-Customs dated the 30th June,2017
B. RESCINDING OF NOTIFICATION RELATING TO SWS

These notifications are being rescinded on account of being redundant due to basic customs duty rate structure rationalization:
1 No. 13/2021-Customs, dated the 1st February, 2021, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R.

71(E), dated the 1st February, 2021
2 No. 34/2022-Customs, dated the 30thJune, 2022, published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S.R. 487(E), dated the 30thJune, 2022

AGRICULTURE INFRASTRUCTURE AND DEVELOPMENT CESS (AIDC)

Notification No. 11/2021 – Customs, dated 01.02.2021 is being amended to revise the AIDC rates on the following goods (w.e.f. 02.02.2023):
A. AIDC rate changes (with changes to the effective rate ofCustoms Duty) Rate of Duty
S. No Chapter, Heading, sub- heading, tariff item Commodity From To
1. 7106,98 Silver (including silver plated with gold or platinum), unwrought or in semi- manufactured forms, or in powder form 2.5% 5%
2. 71 Silver Dore 2.5% 4.35%
B. Changes to AIDC (without any change to the effectiverate of Customs Duty) Rate of Duty
S. No Chapter, Heading, sub- heading, tariff item Commodity From To
1. 2701, 2702,

2703

 Coal, peat, lignite 1.5% Nil
2. 40113000 New pneumatic tyres, of rubber , of a kind used on aircraft as mentioned in Entry  280 A  of  Notification  No.

50/2017-Cus

 Nil 0.5%
3. 7108 or 98 Gold (including gold plated with platinum) unwrought or in semi- manufactured forms,or in powder form 2.5% 5%
4. 71 Gold Dore 2.5% 4.35%
5. 7110 Platinum other than rhodium and goods covered under S. Nos. 415(a) and 415A of the Table in notification No. 50/2017- Customs, dated the 30th June, 2017. 1.5% 5.4%
6. 8802 20 00

8802 30 00

8802 40 00

 Aero planes and other aircraft covered under S.No. 543A of Notification No. 50/2017-Cus Nil 0.5%

How Can InCorp Help You?

At InCorp, our team has extensive expertise and experience that can assist you in complying with GST requirements and other indirect taxes. We assist in managing your taxes efficiently.

Our service scope includes: 

  • GST Compliances 
  • GST Operational Assistance 
  • GST Audit Services 
  • GST updates on recent notifications 
  • GST Representation and Litigation Support 
  • Other Indirect Taxes Advisory and Litigation 

Stay compliant with all GST regulations!

Get in touch with us right away!

BUDGET 2022 – GST, Customs, Excise Duty Highlights

by InCorp Advisory

Reading Time: 5 minutes

In the Union Budget 2022, Finance Minister – Nirmala Sitharaman announced certain provisions and amendments in the rates of indirect taxes – GST, Customs, Excise. We have categorised sector wise and tabulated the same for your convenience below:

Agriculture & Food industryAgriculture & Food Industry:
Duty Impact
Capital Goods • Labelling and sealing machines and those used for industrial preparation or manufacture of food or drink except for animal or fixed vegetable fats or oils will see a withdrawal of exemptions or concessions from 01.04.2023

• Goods required for renovation, modernization or maintenance of a fertilizer plant will see a withdrawal of exemptions or concessions from 01.04.2023

• Specific agricultural implements and parts used for their manufacture will see a withdrawal of exemptions or concessions from 01.04.2023
Raw Materials • Foods such as Frozen Mussels and Squids sees a major reduction to 15%,

• Asafoetida is reduced to 5% (effective 15% reduction) and Cocoa beans to 15%.

• Methyl Alcohol & Acetic Acid sees a reduction by 2.5%

• Microbial fats and oils and their fractions will see an increase of BCD to 100%

• An exhaustive list of goods for which BCD exemption was notified in notification No. 50/ 2017 have been withdrawn.

Textiles and footwear industryTextiles & Footwear Industry:

Duty Impact
Capital Goods · Various concessions on capital goods are withdrawn with some withdrawals being done in a phased manner.

· Some goods will see a withdrawal of exemptions or concessions from 01.04.2022 and some others from 01.04.2023

· Effluent treatment plants will see a withdrawal of exemptions or concessions from 01.04.2022 and 292 goods specified in List 27 to notification No. 50/2017- Customs from 01.04.2023.
Raw Materials · Textiles under Chapters 52, 53, 54, 55 & 58, will see a reduction in BCD between 5% to 15% and some changes in rate per square metre.

· Textiles under Chapters 60, 61 & 62 will see a reduction in BCD up to 5%, and the BCD calculation based on rate per square metre is removed.

Mining and metals industriesMining and Metals Industries:

Duty Impact
Capital Goods · For project imports of Iron ore projects registered till 30.09.2022 will attract old BCD rates till 30.09.2023, and 7.5% BCD for all others from 30.09.2022.
Raw Materials · Ferrous waste and scrap will see a ‘nil’ rate till 31.03.2023 and is reduced to 2.5% after that.

· Nil rate on Iron and steel scrap extended till 31.03.2023

· An exhaustive list of goods for which BCD exemption was notified in notification No. 50/ 2017 have been withdrawn.

ADD is permanently revoked for imports of:

· Straight Length Bars and Rods of alloy-steel from China.

· High Speed Steel of Non-Cobalt Grade from China, Brazil or Germany

· Flat rolled product of steel, plated or coated with alloy of Aluminum or Zinc from China, Vietnam, Korea.

CVD is permanently revoked for imports of certain Hot Rolled and Cold Rolled Stainless Steel Flat Products originating from China.

Power utilities and Renewable EnergyPower Utilities; Renewable Energy:

Duty Impact
Capital Goods · Various concessions on capital goods provided in Notification No. 50/2017 are withdrawn with some withdrawals being done in a phased manner. Some goods will see a withdrawal of exemptions or concessions from 01.04.2022 some others from 01.04.2023.

· In case of goods other than above and used for the purpose of initial setting up of power generation project or fuel cell-based system for generation of power, then concessional BCD will be withdrawn from 01.04.2023.

· Geothermal ground source heat pumps will see a withdrawal of exemptions or concessions from 01.04.2023

· For Project imports of coal, nuclear, gas, and solar projects registered till 30.09.2022 will attract old BCD rates till 30.09.2023, and 7.5% BCD for all others from 30.09.2022.
Raw Materials · Solar energy devices like solar cells and modules will be increased to 25% & 40% respectively from 01.04.2022

· An exhaustive list of goods for which BCD exemption was notified in notification No. 50/ 2017 have been withdrawn.

MSMEMSME:

Duty Impact
Capital Goods · Various concessions on capital goods provided in Notification No. 50/2017 are withdrawn with some withdrawals being done in a phased manner. Goods such as machines used in cricket bats joining, rugby balls, soccer balls stitching and moulds for the same are being withdrawn from 01.01.2023.
Raw Materials · Umbrellas will see an increase of BCD to 20%.

· An exhaustive list of goods for which BCD exemption was notified in notification No. 50/ 2017 have been withdrawn.

Jewelry sectorJewelry Sector:

Duty Impact
Capital Goods · Goods for making of gems and jewellery will see a withdrawal of exemptions or concessions from 01.04.2023.
Raw Materials · Imitation jewellery will see an increase of BCD of 20% or 400/kg., whichever is higher.

· BCD on cut & polished diamonds and natural gemstones have been reduced to 5%

Electrical & Electronic Items and TelecomElectrical & Electronic Items And Telecom:

Duty Impact
BCD · Camera lens used in manufacture of mobile phones will see a reduction in BCD to 2.5%

· An exhaustive list of goods for which BCD exemption was notified in notification No. 50/ 2017 have been withdrawn.

· BCD rationalization of Parts or components for use in manufacture of populated printed circuit board of various telecom and electronics related products, and its sub-parts except DVR/NVR, CCTV and reception apparatus has been made.

· Exemptions / Concessions for those goods not already omitted in 25/1999-Customs and capital goods list in 25/2002-Customs will be withdrawn from 01.04.2024

· Various goods imported for manufacture of wearable devices, hearable devices, smart meters, will be levied BCD in a phased manner as part of the Phased Manufacturing Program.

Petroleum SectorPetroleum Sector:

Duty Impact
Capital Goods · Various concessions on capital goods provided in Notification No. 50/2017 are withdrawn with some withdrawals being done in a phased manner. Some will see a withdrawal of exemptions or concessions from 01.04.2022 and the rest from 01.04.2023.

 
Raw Materials · An additional Basic Excise Duty will be levied on unblended Petrol and Diesel  from 01/10/2022 in order to promote:

o Blended Motor Spirit with ethanol/methanol

o Blended High-Speed Diesel with Bio-diesel

Real Estate sector & InfrastructureReal Estate Sector & Infrastructure:

Duty Impact
Capital Goods · For Project imports of water supply projects and Mandi and Warehousing Projects for Food Grains registered till 30.09.2022 will attract old BCD rates till 30.09.2023, and 7.5% BCD for all others from 01.10.2022.

Pharma industryPharma Industry:

Duty Impact
Capital Goods · For Project imports of water supply projects and Mandi and Warehousing Projects for Food Grains registered till 30.09.2022 will attract old BCD rates till 30.09.2023, and 7.5% BCD for all others from 30.09.2022.
Raw Materials · BCD on X-ray machines and some items used for its manufacture is increased to 10%.

· Health Cess on Surgical needles imported for manufacture of surgical sutures to be reduced to ‘nil’.

· Exemption on goods used for Research and Development purpose in pharmaceutical and bio- technology sector have an end-date of 31.03.2023

· Concessional rate of 5% on 35 items of Drugs, medicines, diagnostic kits, or equipment specified in List 3 and List 4 of notification no. 50/ 2017 and bulk drugs used in the manufacture of drugs or medicines above have been rationalized.

· Concessional rate for drugs supplied free-of-cost to patients in 16/2017-Customs notification will be withdrawn from 01.04.2023.

· An exhaustive list of goods for which BCD exemption was notified in notification No. 50/ 2017 have been withdrawn.

Social Welfare Surcharge on Goods Classified Under The Following Chapters Will Be Exempted From 02.02.2022

Chapter heading Description of goods Tariff heading
08 Edible fruit and nuts; peel of citrus fruits or melons 08029100, 08029200, and 08029900,
15 Animal or vegetable fats and oil and their cleavage products; prepared edible fats; animal or vegetable waxes 150990 and 151090
25 Salt; sulphur, earths and stones; plastering materials, lime and cement 25151290, 25161100, 25161200
52 Cotton 520839, 520931, 520932, 520939, 520949, 521039, 521131, 521132, 521139, and 521149
54 Man-made filaments 540761
55 Man-made staple fibres 55162200 and 55162300
58 Special woven fabrics; tufted textile fabrics; lace; tapestries; trimmings; embroidery 58023000
60 Knitted or crocheted fabrics 60019200
61 Articles of apparel and clothing accessories knitted or crocheted 61012000, 610130, 61021000, 61022000, 610230, 61046200, 61046300, 6103, 61019090
62 Articles of apparel and clothing accessories, not knitted or crocheted 620130, 620140, 620230, 620240, 62041100, 62041300, 620419, 620431, 62043200 & 62043300, 620439 & 620469; 62032200, 62032300, 620329, 62034100, 620342

BCD=Basic Customs Duty; BED=Basic Excise Duty; SWS=Social Welfare Surcharge; ADD=Anti-Dumping Duty; CVD=Countervailing Duty

The list of changes in Customs is exhaustive, therefore, readers are encouraged to mail or call Incorp Advisory for specific queries in Customs.

How Can InCorp Help You?

At InCorp, our team has extensive expertise and experience that can assist you in complying with GST requirements and other indirect taxes. We assist in managing your taxes efficiently.

Our service scope includes: 

  • GST Compliances 
  • GST Operational Assistance 
  • GST Audit Services 
  • GST updates on recent notifications 
  • GST Representation and Litigation Support 
  • Other Indirect Taxes Advisory and Litigation 

Stay compliant with all GST regulations!

Get in touch with us right away!

UNION BUDGET 2022 – Tax and Policy Highlights

by InCorp Advisory

Reading Time: 6 minutes

The Finance Minister (FM) presented the Union Budget of 2022 with a focus on – PM Gati Shakti plan, productivity enhancement, financing investments, and climate action. We have compiled the key points highlighting the tax and policy updates.

The government has announced the following provisions in the Union Budget 2022:

Reliefs in Direct Tax Provisions:
  • Reduction in AMT rates for Co-operative Societies from 18.5% to 15%.
  • Reduced surcharge applicable for Co-operative Societies with total income of INR 1cr to 10Cr from 12% to 7%.
  • Start-ups established before 31.03.2023 (earlier on 31.03.2022 has now been extended by 1 year) will be able to enjoy tax benefits u/s 80IAC.
  • Last date for commencement of manufacturing activities for claiming lower tax regime u/s 115BAB to be 31.03.2024 (earlier on 31.03.2023 has now been extended by 1 year).
  • Exemption on amount received for medical treatment and on account of Death due to COVID-19.
Rationalization of Direct Tax Provisions:
  • Tax relief for persons with disability: Allow annuity payment to differently abled dependents when parents attaining age of 60 years.
  • Deduction for National Pension Scheme for State Government Employees u/s 80CCC made at par with Central Govt. NPS which is currently @10% of Salary for State govt. Employee which has been increased to 14% of salary.
  • TDS on sale of immovable property u/s 194-IA is now applicable on agreement value or stamp duty value whichever is higher @ 1% for value exceeding INR 50 Lakhs.
  • Extension of bonus & dividend stripping Section 94 provisions to new pooled investments such as InvIT, REIT, AIFs.
  • Rationalization of various provisions pertaining to Penalties, Assessment & Re-assessment proceedings under Income Tax Act.
  • Rationalization of various provisions pertaining to Trust & its exemption.
Withdrawal of Relief/Benefits under Direct Tax provisions:
  • Withdrawal of various exemption provided u/s 10 available to specific employee class of assessee.
  • Virtual Digital Assets (VDA) have been defined as Cryptocurrency, NFT & other tokens.
    • Income from transfer of virtual digital assets to be taxed at 30%.
    • No deduction for expenses other than cost of acquisition.
    • Loss from transfer of VDA not allowed to be set off against any other income. Even carry forward of such losses not permissible.
    • TDS @ 1% on consideration above specific threshold.
    • Gift to be taxed u/s 56(2)(x).
  • No repetitive appeals for common question of laws.
  • Specified businesses to be eligible for benefit in Gift City – IFSC where there are certain income tax exemptions & benefits.
  • Surcharge on Long Term Capital Gains on any assets to be capped at 15%.
  • No set off of losses against undisclosed income detected during search & survey.
  • Provision for filing ‘Updated Income Tax returns’ within 2 years from end of relevant AY in specific cases.
  • Introduction of section 194R for TDS deduction on benefit/perquisite of business or profession.
  • Extension of Specified financial transaction reporting to producers of cinematograph films or persons engaged in specified activities.
  • Source of funds in hands of creditor needs to be proved in case of loan or borrowing in lines with share capital as per provisions of section 68.
The Government Further Provided Certain Clarifications in Direct Tax Provisions:
  • Health and education cess & surcharge not allowable as business expenditure u/s 37.
  • Section 14A disallowance even if exempt income is not accrued or received during the year.
  • Any deduction for payment made on account of offense in or outside India is not allowable u/s 37.
  • In case of businesses reorganized under IBC laws, section 156A is introduced to give effects of order of Competent Authority like National Company Law Tribunal (NCLT) and modification of demand.

INTERNATIONAL TAX PROVISIONS

The Finance Minister proposed the below Tax Incentives to International Financial Services Centre (IFSC) in the Union Budget 2022:
  • Exemption in respect of income of a non-resident from transfer of non-deliverable forward contracts entered into with an Offshore Banking Unit (OBU) of an IFSC, now extended to offshore derivative instruments or over-the-counter derivatives.
  • Exemption in respect of income of a non-resident by way of royalty or interest paid by an unit of IFSC on account of lease of an aircraft now extended to lease of ship.
  • Deduction in respect of income arising from transfer of an aircraft leased by a unit of an IFSC, now extended to ship.
  • Exemption in respect of income of a non-resident from portfolio of securities or financial product or funds managed by a portfolio manager in an account maintained with OBU in an IFSC.
  • The benefit of exclusion from provisions of section 56(2)(viib) extended to Category I and Category II AIF regulated under IFSC.
Other amendments to Foreign Income:
  • Tax relief for persons with disability: Allow annuity payment to differently abled dependents when parents attaining age of 60 years.
  • Claim of refund of withholding tax deposited under section 195 can now be made by filing an application before the assessing officer which earlier required filing of an appeal before the CIT(Appeals).
  • Withdrawal of concessional tax rate of 15% on dividend income received by an Indian company from a foreign company, where the Indian company holds 26% or more in such foreign company .

INDIRECT TAX PROVISIONS

With respect to GST, Customs Duty and Excise Duty the provisions announced in the Union Budget 2022 can be categorized as follows:

Reliefs in GST Laws
  • Relaxation in time limits for rectification of sale invoice and to issue GST credit note against any sale invoice has been proposed to be extended from 30th September to 30th November of next financial year.
  • Time limits to avail ITC on any invoice of any particular year has been extended from 30th September to 30th November of next financial year.
  • Due date to file GST return by Non- resident taxable person (Form GSTR 05) has been amended from 13th to 20th of next month.
Rationalization of GST Laws
  • In case of multiple GST registration of the same company, if tax of any particular state is mistakenly paid in any other state’s GST registration then mechanism can be transferred just by filing PMT 09 instead of applying refund.
  • If ITC is availed wrongly but not utilized and is lying in electronic credit ledger then no interest will be applicable.
  • Rate of interest on account of wrong ITC utilized reduced from 24% to 18% w.e.f. 01.07.2017.
  • Clarification provided that the relevant date applicable for refund applications from supplies to SEZ is 2 years from due date of filing of Form GSTR 3B return.
  • Grant of alcoholic liquor license against consideration in the form of license fee or application fee by State Governments shall be treated neither as a supply of goods nor a supply of service.

Rate changes in Customs and Excise

For Electrical and Electronic Items:
  • Rate increase in speakers, headphones, and raw materials from 5% to 10%.
  • Effective rate changes to be impacted by Phased Manufacturing Program.
  • Rate decrease in camera lens for mobile and chargers from 10%/15% to 2.5% & 5% respectively.
For Gems and Jewellery:
  • Rate increase in Imitation Jewellery from 20% to Higher of 20% on value or Rs. 400/kg.
  • Rate decrease in Cut & polished diamonds and natural gemstones from 7.5% to 5%.
For Solar Energy:
  • Rate increase in Solar Cells and Solar Modules from 20% to 25% & 40% respectively.
  • Effective rate to be ‘NIL’ till 31st March 2022.
For Miscellaneous Product:
  • Rate increase in Umbrellas from 10% to 20%.
  • Frozen Mussels and Squids – Rate decrease from 30% to 15%.
  • Asafoetida and Cocoa Beans, whole or broken, raw or roasted – Rate decrease from 30% to 5% & 15% respectively.
  • Methyl alcohol (methanol) and Acetic acid – Rate decrease from 10% to 2.5% & 5% respectively.
  • Textiles other than those whose effective basic customs duty is not changed – Rate decrease ranges from 10% to 5% and amounts calculated square meter-wise whichever is higher.
Concessions on Basic Customs Duty For The Following Sectors:
  • Rate increase in speakers, headphones, and raw materials from 5% to 10%.
  • Effective rate changes to be impacted by Phased Manufacturing Program.
  • Rate decrease in camera lens for mobile and chargers from 10%/15% to 2.5% & 5% respectively.
For Gems and Jewellery:
  • Rate increase in Imitation Jewellery from 20% to 20% or Rs. 400/kg whichever is higher.
  • Rate decrease in Cut & polished diamonds and natural gemstones from 7.5% to 5%.
For Solar Energy:
  • Rate increase in Solar Cells and Solar Modules from 20% to 25% & 40% respectively.
  • Effective rate to be ‘NIL’ till 31st March 2022.
Clarifications in Direct Tax Provisions:
  • Agricultural products, Chemicals and Plastics, Paper, Metals, Medical devices, Toys, Capital Goods.
Concessions for import to be provided to Bonafide exporters:
  • A duty-free scheme on goods meant to be used in goods meant for export by bonafide manufacturers to be introduced.
  • Industries that will gain from this are the handicraft industry, textile and leather garments industry, leather and synthetic footwear industry.

Note: Anti-dumping duty (ADD) / Countervailing Duty (CDD) to be revoked on various goods imported from China, Germany, Vietnam and Korea.

Withdrawal of exemptions or concessional rates and levy of additional rates:
  • Gradual phasing out of exemptions for capital goods and project imports of the following major sectors: Textile sector, Power sector, Petroleum sector, Leather sector, Food packaging sector and Project imports in Coal, Gas, Iron Ore, and Water supply projects.
  • Concessional rates of basic customs duty provided in notification no. 50/2017 dated 30.06.2017 and certain stand-alone notifications to be withdrawn for various goods or exemptions provided to be given an end date. Social Welfare Surcharge (SWS) to be levied on various goods falling under chapters 08, 15, 25, 52, 54, 55, 58, 60, 61 and 62.

Changes in Excise Duty:

  • Fuel blends being Ethanol Blended Petrol with the percentage of ethanol up to twelve (E12) and fifteen (E15) percent respectively to be included Fourth Schedule to the Central Excise Act, 1944.
  • Blended Motor Spirit with ethanol/methanol or High-Speed Diesel with Bio-diesel will see a levy of Basic Excise Duty of Rs. 2/litre from 1st October 2022.

Trademark vs Patent vs Copyright: Which One Suits You The Best?

by InCorp Advisory

Reading Time: 4 minutes

Entrepreneurs in India slowly but steadily recognise the importance of intellectual property. This article discusses intellectual properties such as copyright, patents, and trademarks, as well as how they can help you protect your entrepreneurial ideas. Continue reading to find out which of the three options best suits your company’s needs.

What is Intellectual Property?

Intellectual property (IP) includes scientific discoveries, literary and creative works, designs, and so on. The three most commonly known types of intellectual properties that you should be aware of are:

  • Trademarks
  • Patents
  • Copyrights

What are Intellectual Property Rights (IPR)?

Intellectual Property Rights (IPRs) are legal rights that allow you to safeguard your intellectual inventions. These rights aid in the development of your company’s brand.

What is a Trademark, and what are its advantages?

A trademark is any word, symbol, or logo that helps consumers distinguish a product from its competitors. Trademark registration is an essential part of your company’s branding since they keep it distinct and distinctive. The exclusive right to use, sell, and alter your brand or goods in any way is granted by trademark registration.

Trademark registration is necessary since it aids in the development of your company’s brand image. Trademarks in India are divided into 45 different types or divisions. For example, a class could be footwear, metal export, or face cream manufacture. Your trademark can be registered in any of the above-mentioned classes.

Advantages of owning your Trademark:

Input tax credit denial to your customers The registered trademark informs the consumer/customer and any third parties that the product(s) or service(s) delivered under that brand belongs to the trademark applicant.
Blocking of E-waybillA registered trademark allows you to use, promote, and market the goodwill associated with the mark. It also aids in the avoidance of trademark infringement and the retention of your client’s loyalty.

Related read: Everything You Need To Know About The Trademark Registration Process In India

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What is a Patent, and what are its advantages?

The purpose of a patent is to gain a competitive advantage. A patent gives you the exclusive right to create, use, trade, or import what you’ve invented after it’s been granted. The patent owner is the sole owner of the rights to sell or utilise the patent.

Patents are particularly significant in the industrial and pharmaceutical industries. The creator/company is the exclusive owner of the right to use the process with a patent in place.

Advantages of obtaining your Patent:

Input tax credit denial to your customers You can choose who may and who may not use the patented invention for the length of the patent’s protection.
Blocking of E-waybillPatent protection, bans anyone from commercialising, manufacturing, distributing, importing, or selling your invention without your permission.

Related read: How To Avoid Trademark Infringement?

CLICK HERE

Copyright corresponds to the exclusive right to produce, reproduce, promote, and sell your original work. Musical, literary, artistic, architectural, or theatrical works make up the majority of these pieces.

Programs, compilations, databases, and tables are examples of electronic works considered literary works. Furthermore, registering copyright serves as a deterrent to copycats misrepresenting or exploiting your original work.

Advantages of acquiring your Copyright:

Input tax credit denial to your customers Anyone with similar business interests cannot copy or use your brand. Someone with a different commercial interest, on the other hand, could copy or use it.
Blocking of E-waybillOnly the creator or whoever has registered copyright has the right to sell/copy or use a part of the work for any reason.
Blocking of E-waybillProtection is granted for 60 years from the year in which your work is made available to the public (e.g. cinematograph films and photographs)


What is the difference between a Trademark vs. Patent vs. Copyright?

Particulars Trademark Patent Copyright
Meaning It is a unique identity or expression used to identify your specific company or its goods or services It is a perfect way to protect your creations and gives you the sole right to our design  It is a legal right that protects the copying of your creative work
Term of registration It can be registered for a term of 10 years, after which you can renew it for another ten years. It is awarded for 20 years from the date of application. It is dependent on the nature of your work. It lasts throughout the author’s lifetime and even after their death in literary, musical, or artistic work.
Protection covers products/ ideas such as  Any word, symbol, or other characteristic that differentiates one rival from another in the same field. Inventions such as a specific procedure, the composition used to create an element, and so on. Books, articles, songs, sound recordings, and other original works of authorship.
Rights granted Right to use the mark and prevent others from using the same mark to identify goods or services based on your brand. Right to stop others from producing, selling, or importing your patented invention. Control over the replication and distribution of your original work is a legal right.


How Can InCorp Help You?

Thousands of business ideas pass through our heads every day, and a few of them may be exceptional or noteworthy. Your idea may or may not be protected by intellectual property law. However, your final creation with that exceptional idea could be protected under Intellectual property laws. Copyrights, patents, and trademarks can all be used to protect or preserve your work. They safeguard you (goods and service providers) by allowing you to control how your products/designs are used.

India offers a wide range of intellectual property rights to business owners. Choosing which intellectual property to use, on the other hand, can be a lengthy and complicated process.

That’s where our knowledgeable team of experts with years of experience can assist you.

Protect What Is Rightfully Yours

Get in touch with us right away!

Trademark Infringement – Meaning & Tips On How To Avoid It

by InCorp Advisory

Reading Time: 5 minutes

Any business that wants to succeed in today’s competitive market must-have brand recognition and value. Trademarks are the most straightforward way for you to accomplish this. The Trademarks Act protects registered trademarks in India and specifies the rules for trademark registration and penalties for infringement. 

In India, trademark infringement is a cognizable offense, meaning that the offender could face criminal and civil charges. In this article, we discuss about the types of contraventions and how to avoid trademark infringement:.

What Is Trademark Infringement?

The Trademarks Act establishes the laws governing trademark registration, protection, and penalties for infringement in India. Trademarks are treated as intellectual property all around the world. 

Trademark  or brand infringement occurs when a third party has not been granted permission to use the intellectual property, specifically a trademark of a company/business related to the service or product that the company provides. This may confuse the general public when purchasing that service or product.

Related read: Everything You Need To Know About The Trademark Registration Process
In India

CLICK HERE

What are the types of Trademark Infringement?

When investigating trademark infringement in an offline business or an online marketplace, it’s important to understand that there are two categories of infringement:

Direct infringementDirect Trademark Infringement
  • Direct Infringement occurs when a registered trademark’s exclusive rights are used without permission. It is a type of trademark infringement under the Trademark Act. It includes the following elements:
    • Unauthorised access:
      • It is considered trademark infringement when a registered mark is used by someone not authorised by the registered trademark owners.
      • It is not considered infringement if the mark is utilised with the permission of the registered trademark proprietor.
    • Identical or deceptively similar:
      • The unauthorized person’s trademark must be identical to or deceptively similar to the registered trademark. The word “deceptively similar” simply suggests that the average customer may be confused by the marks and mistake them for one another.
      • The keyword here is ‘may,’ it only has to be demonstrated that this is a possibility, not that it will happen. It is sufficient to prove infringement if there is a likelihood of misrecognition of the marks.
    • Registered trademark:
      • The Act protects only trademarks that have been registered under India’s trademark registration.
      • To resolve disputes when an unregistered mark is infringed, the common law of passing off is utilised. It is a tort law applied when a person or group of people suffers hurt or damage to their goodwill due to their actions.
    • Class of goods or services:
      • Trademark law states that to be considered a trademark infringement, the unauthorised use of the mark must be to promote products or services in the same class as the registered brand.
Indirect infringementIndirect Trademark Infringement
  • In comparison to direct infringement, there is no specific provision in the Act dealing with indirect infringement. This isn’t to say that there’s no risk of indirect infringement. Indirect violation can be divided into the following two categories:
    • Contributory infringement:
      It is made up of simply two elements:-

      • When the person is aware of the brand infringement but takes no action to avoid infringing.
      • When the person contributes meaningfully to the direct infringement.
        There is no exception in the situation of contributory infringement since the contributing infringer has no prospect of acting in good faith.
    • Vicarious liability:
      A person will be vicariously liable:

      • When the person can control the actions of the direct infringer.
      • When a person gains from the infringement.
      • When a person knows about the infringement and contributes to it.

      If a corporation violates the Act, the entire corporation is accountable. Everyone in the company will be liable for indirect infringement, not only the lead infringer. The only exception is someone who acts in good faith and without knowledge of the infringement.

What are the different penalties under Trademark Infringement?

In India, trademark infringement is a serious offence, which means that the offender could face both criminal and civil prosecution. The registration of a trademark is also not necessary by Indian law for the institution of civil or criminal proceedings. This is related to the common law idea of passing off, as previously stated. The court may award the following remedies in the case of trademark infringement:

  • Temporary injunction
  • Permanent injunction
  • Damages
  • Account of profits (damages equal to the earnings made as a result of the infringement)
  • Destruction of goods using the infringing mark
  • Cost of legal proceedings

In the event of a criminal case, the court will impose the following penalties:

  • Imprisonment for a minimum of six months and a maximum of three years.
  • A punishment of not less than Rs 50,000 and up to Rs 2 lakh may be imposed.

Trademark Infringement Case Studies:

Amul DairyAmul Dairy

The Kaira District Cooperative Milk Producers Union, also known as Amul Dairy, and the Gujarat Cooperative Milk Marketing Foundation (GCMMF), which markets the Amul brand, have filed a complaint in the Federal Court of Canada against Amul Canada and four other companies. The dairy learned in January 2020 that Amul Canada had duplicated its trademark “Amul” and the emblem “Amul—The Taste of India.” On the social media platform LinkedIn, a false profile was also created.

Amul has won a trademark infringement dispute outside of India after the Federal Court of Canada recently ruled in its favour. The Intellectual Property Appellate Board of Canada recently granted Amul trademark recognition as a result of the order. After winning a trademark violation case in the Federal Court of Canada, the country’s largest dairy cooperative society will also be rewarded 32,733 Canadian dollars.

StarbucksStarbucks vs Sardarbuksh

Starbucks filed a lawsuit against Sardarbuksh for using a logo that is strikingly similar to Starbucks’ and using a name that provides a sense of similarity between the two. Starbucks won the case. The court ordered the defendant to change their name but not their emblem because Starbucks had changed theirs.

It was noted that the judgement pronounced also took into account the fact that the similarity in the names and logos had caused economic hurdles for Starbucks. Starbucks, a global brand that has accumulated goodwill due to its long history in the coffee business, and that the defendants were aware of this and did what they did to gain attention.

Coca Cola Company v. Bisleri InternationalThe Coca Cola Company v. Bisleri International Pvt. Ltd.

Bisleri was the defendant in this case due to an agreement that allowed the transfer and assignment of MAAZA trademark rights. It provided Coca-Cola with the formulation rights, intellectual property rights, and know-how, as well as the goodwill associated with bottling and distributing a mango fruit drink called MAAZA in India.

The defendant firm has filed a trademark application in Turkey for the term MAAZA and has begun exporting the identical fruit drink under that name. Coca-Cola sought a permanent injunction and infringement damages for passing off and trademark infringement after the defender, Bisleri, gave it to them.

In the end, Bisleri was found to have violated the interim injunction by utilising the brand MAAZA in India and even offering it for export, which was a clear example of trademark infringement.

Conclusion

Every business must understand that once a trademark is registered, it gets the privilege to avail legal protection against trademark infringement under the Trademark Act of India. Indulging in trademark infringing can hamper the company’s growth. Most of the trademark infringement cases consider proof of prior use even if the trademark is not registered.

It is best to hire professional business services to ensure protection against such futuristic compliance issues. Make sure to have a trademark search before you unknowingly use some other brand’s intellectual property. Using identical or similar marks, knowingly or unknowingly, will be considered as Trademark Infringement..

Why Choose Incorp?

Our expert team of professionals have the expertise and skills to guide you in any way possible, from protecting your brand to registering your Trademark. Whether you are the plaintiff or the defendant, Incorp can assist you with legal advice in the following:

  • Registering your Trademark
  • Drafting agreements
  • Avoiding legal issues

Know more on How to Avoid Trademark Infringement

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