Legislation UpdatesNotifications

The United States of America (USA) has w.e.f. 5 June 2019 withdrawn India’s GSP benefits. These are unilateral, non-reciprocal and non-discriminatory benefits extended by some developed countries to developing countries. India as part of our bilateral trade discussions, had offered resolution on significant US requests in an effort to find a mutually acceptable way forward.


[Source: PIB]

Ministry of Commerce & Industry

Business NewsNewsTreaties/Conventions/International Agreements

Sub-section (4) of Section 286 of the Income-tax Act, 1961 requires that a constituent entity of an international group, resident in India, other than a parent entity or an alternate reporting entity of an international group, resident in India, shall furnish the Country-by-Country (CbC) Report in respect of the said international group for a reporting accounting year within the period as may be prescribed, if the parent entity of the said international group is resident of a country or territory,—

  •  where the parent entity is not obligated to file the CBC Report;
  •  with which India does not have an agreement providing for exchange of the CbC Report; or
  • where there has been a systemic failure of the country or territory and the said failure has been intimated by the prescribed authority to such constituent
    entity.

2. Vide Notification in GSR 1217 (E) dated 18th December, 2018 with effect from 18th December, 2018, amendments to the Income-tax Rules. 1962 (the “Rules”) have been carried out to provide that the period for furnishing of the CbC report (local filing) shall be twelve months from the end of the reporting accounting year.

3. Further, vide Circular No.9/2018, dated 26th December, 2018, CBDT as a one-time measure, in exercise of powers conferred under Section 119 of the Act, extended the period for furnishing of the CbC Report (local filing) in respect of reporting accounting years ending on or before 28 February, 2018 up to 31st March, 2019.

4. The absence of an agreement between India and USA till now entailed a possibility of local filing of CbC Reports in India. However, a Bilateral Competent Authority Arrangement, along with an underlying Inter-Governmental Agreement, for exchange of CbC Reports between India and the USA has now been finalized and will be signed on or before 31st March, 2019. This would enable both the countries to exchange CbC Reports filed by the ultimate parent entities of International Groups in
the respective jurisdictions, pertaining to the financial years commencing on or after 1st January, 2016. As a result, Indian constituent entities of international groups headquartered in USA, who have already filed CbC Reports in the USA, would not be required to do local filing of the CbC Reports of their international groups in India.

[Press Release dt. 15-03-2019]

Central Board of Direct Taxes

Ministry of Finance

International CourtsNews

International Court of Justice (ICJ): The ICJ will hold public hearings devoted to Preliminary Objections raised by the United States in the case concerning Certain Iranian Assets [Islamic Republic of Iran (Iran) v. United States of America (USA)], from 8 to 12 October 2018, at the Peace Palace in The Hague, the seat of the Court.

Iran instituted proceedings on 14 June 2016 against the USA before ICJ with regard to a dispute concerning violations by the USA of the Treaty of Amity, Economic Relations, and Consular Rights between them. It was signed in Tehran on 15 August 1955 and entered into force on 16 June 1957” (hereinafter “the 1955 Treaty”). The 1955 Treaty was signed with the then regime of the Shah long before he was ousted in the 1979 Islamic Revolution. But the US severed bilateral diplomatic ties with Iran in 1979 after 52 Americans were taken hostage in the US embassy in Tehran. They have not yet been fully restored.

The case was filed just weeks after the US Supreme Court ruled in April 2016 that $2 billion in frozen Iranian assets should be paid to about 1,000 survivors and relatives of those killed in attacks blamed on Iran. These attacks included the 1983 bombing of a US Marine barracks in Beirut and the 1996 Khobar Towers bombing in Saudi Arabia. According to Iran, US courts have awarded total damages of over $56 billion against it in respect of its alleged involvement in various terrorist acts mainly outside the US.

[Source: The New Indian Express]