India: Combination regulations, employer remittances | KPMG | GLOBAL

India: Combination regulations, employer remittances to provident fund

India: Combination regulations, employer remittances

The KPMG member firm in India has prepared reports about the following tax developments (read more at the hyperlinks provided below):


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  • Amendments to “combination regulations” under the Competition Act, 2002: The Competition Commission of India (CCI) originally issued regulations in May 2011, and then amended them from time to time. The CCI issued the fifth set of amendments to the original combination regulations effective 7 January 2016. Read a January 2016 report [PDF 357 KB]
  • No five-day grace period for remitting of monthly provident fund contributions: Under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 (EPF Act) the employee and the employer must pay 12% of the salary towards the provident fund. Employers are required to pay their contributions and administrative charges within 15 days of the close of every month. There had been a five-day grace period for employers to remit their contributions. That grace period has been removed. Employers must now remit their contributions and administrative charges within 15 days of the close of every month.
  • Land on which building is under construction is subject to wealth tax: The Supreme Court of India held that land on which building construction is under progress is subject to wealth tax. The land would not be excluded from the scope of “urban land” if the building were still under construction. It would be excluded when the building construction is completed. The case is: Giridhar G. Yadalam.
  • Interest income on application money in a separate bank account is taxable in year of share allotment: The Supreme Court of India held that interest income on application money kept in a separate bank account is taxable in the year when the entire allotment procedure is completed—and not in the year of public issue. The case is: Henkel Spic India Ltd.

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