1. Tax, Customs, Trade & Regulatory Laws
India has a federal structure and levies multiplicity of taxes. The Constitution of India provides clear allocation of areas under which only the Federal Government and the State Governments can levy taxes and areas under which both can levy taxes concurrently.
The Federal Government presently levies the following key taxes:
- Income Tax – on income of corporate and individuals
- Customs Duty – on import or export of goods
- Excise Duty – on manufacture of excisable goods
- Service Tax – on provision of taxable services
- Research & Development Cess – on import of technology
- Cesses under various legislations on specified goods, industry, taxes and duties
The State Governments presently levy the following key taxes:
- Value Added Tax (VAT)/Central Sales Tax (CST) – on sale of goods
- Entry Tax – levied on entry of goods
Further GST is proposed to be introduced in India w.e.f. April 1, 2016, which will subsume some of Indirect Taxes both at Federal and State level. The Empowered Committee of the State Finance Ministers is leading initiative in this regard and is also coordinating with the Federal Government. The Federal Government has already introduced the Constitutional Amendment Bill in the Parliament, to provide enabling provisions in the Constitution of India for introduction of GST. Hence industry has to gear up for migration to GST w.e.f. April 1, 2016.
ADA assists its clients in full spectrum of advisory services under Indirect Taxes, Customs, Trade and Regulatory Laws, such as:
- Classification and rate of Duty/Tax on goods under the Excise Tariff/Customs Tariff and various Schedules of the State VAT legislations
- Applicability of exemption or concessional rate of Duty/Tax notification to goods and services
- Determination of manufacture to levy Central Excise Duty
- Captive consumption of excisable goods
- Valuation of locally manufactured goods or taxable services
- Dutiability/taxability of export and import of goods and services
- Review of agreements to advise on Duty/Tax implications
- Availability of exemption from CST on sale of goods in the course of import
- Investigations by Special Valuation Branch of Customs (SVB) to determine arm’s length price in case of goods imported from Associated Enterprises
- Availability of Duty Drawback on export of goods
- Availing of various export incentives under the Foreign Trade Policy
- Setting up and de-bonding of 100% Export Oriented Unit (EOU), Special Economic Zone (SEZ), Free Trade Warehousing Zones, etc.
- Export Controls and export/import of restricted goods and technologies
- Assistance for or against levy of Anti-Dumping Duty, Safeguard Duty and Countervailing Duty
- Advice on key issues under the Foreign Exchange Management Act and assistance in compounding of offences thereunder by making an application to the Reserve Bank of India
ADA has expertise to assists clients in migration to Goods and Service Tax (proposed to be introduced w.e.f. April 1, 2016) and provides the following services:
- Mapping of current transactions to understand present Duty/Tax liability and doing ‘what if’ analysis of Tax liability on migration to GST
- Assistance in identifying and making suitable changes in sourcing and distribution model to operate in GST compliant and efficient manner
- Assistance in migration to Goods and Service Tax regime
ADA also provides litigation support to clients under Indirect Tax Laws, Trade and Regulatory Laws, etc. right from the adjudication level upto the Supreme Court of India. Attorneys of ADA regularly appears before Trade and Regulatory authorities such as the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) and the State VAT Tribunals, the Settlement Commission, the Authority for Advance Ruling for Customs, Excise & Service Tax, the Adjudicating Authority in proceedings under the Prevention of Money Laundering Act at the time of hearing.
- Diagnostic review or audit of operations under specified laws to operate in Tax efficient and compliant manner
- Representations before the Central Board of Excise and Customs (CBEC), the Director General of Foreign Trade (DGFT) and various other Tax and Regulatory authorities seeking clarifications on key issues
- Setting up or review of supply chain for sourcing and distribution of goods in a Tax efficient and compliant manner
- Ensuring compliance with various Regulatory Laws like the Environment (Protection) Act, the Telegraph Act, the Legal Metrology Act, the Narcotics Drugs and Psychotropic Substances Act, the Information Technology Act, Bureau of Indian Standards, etc.
- Assistance during and after raid or investigations by Tax and Regulatory authorities like Directorate of Revenue Intelligence, Directorate of Central Excise Intelligence, Enforcement Directorate, etc. to take a view on key Tax & Regulatory positions and options to deal with high risk positions, briefing and debriefing of employees and discussions with the authorities to close the case
- Compliance requirement for shipping/ transportation of specified hazardous goods, chemicals, products, etc.
- Review of tenders and bids to assist in bidding process and negotiations thereafter
- Obtaining of registrations under Indirect Taxes from the authorities
- Export Import Code No. and Licenses/Authorisations from the DGFT for availing export incentives or export/import of restricted goods or technologies
- Approvals from the Development Commissioner of SEZ or the Director STPI for change of implementation agency in case of merger, acquisition or takeover of an existing SEZ unit or EOU