The Madras High Court has allowed the benefit of TDS credit under the GST regime
The Madras High Court has approved the transfer of input credit arising from tax deducted at source under the value added tax system into the GST regime, which would support small and medium businesses. Unused credits will also be used to offset a taxpayer’s output tax liability. The Tamil Nadu goods and services tax department’s decision to refuse the transfer of VAT TDS credit into the new indirect tax regime was challenged by more than 23 petitioners, including those in the construction industry.
GST helps a taxpayer to transition credit earned under the VAT system, according to a bench led by Justice Anita Sumanth. Since any amount of tax received or deducted at source is recorded in returns filed under the VAT rule, the court has decided that all such sums will be included for transition purposes into the new regime. The decision would be particularly beneficial to taxpayers who provide job contract services. Only those taxpayers who filed the electronic form TRAN-1 within the deadline are eligible for the benefit.
Bill to amend the Special Economic Zones Act of 2019: A boost to economic activity and jobs
The Special Economic Zones (Amendment) Bill, which was passed by Parliament in 2019 allows “trusts or entities” to set up units in the Special Economic Zone (SEZ), aims to raise investment and create jobs in a variety of economic activities, including infrastructure.
Prior to the amendment, the act defined a “resident” as “only an entrepreneur who is eligible to be granted permission to create a unit in a Special Economic Zone.” The most common form of body incorporate in the financial sector in India is trusts or institutions, so it has become necessary to amend clause (v) of section 2 of the Act to enable trusts or entities to obtain permission to set up shop in SEZs.