Question 1

What is the statutory threshold for GST registration in India?

Accepted Answer

For businesses supplying goods, mandatory GST registration is required if annual turnover exceeds ₹40 Lakhs (₹20 Lakhs for special category states). For service providers, the turnover threshold is ₹20 Lakhs (₹10 Lakhs in special category states). Entities engaged in inter-state trade, reverse charge mechanisms, or e-commerce selling require mandatory registration irrespective of turnover.

Question 2

How does your firm resolve GSTR-2B vs purchase register ITC mismatches?

Accepted Answer

Under Section 16(2)(aa) of the CGST Act, Input Tax Credit can only be availed if reported in GSTR-2B. We employ automated invoice reconciliation software to identify non-compliant vendors, issue formal demand notices, advise on Rule 37 reversals, and draft legally sound responses to departmental summons under Section 73/74.

Question 3

Can exporters claim refund of unutilized GST input credits?

Accepted Answer

Yes. Exporters of goods and services can either export under a Letter of Undertaking (LUT) without payment of IGST and claim refund of accumulated unutilized ITC (Form RFD-01), or export on payment of IGST and claim automatic rebate from Indian Customs.

Question 4

What are the major compliance differences between the Old vs New Tax Regime?

Accepted Answer

The New Tax Regime under Section 115BAC features lower slab rates but disallows common deductions such as Section 80C, 80D, and HRA. The Old Regime allows extensive exemptions for individuals servicing home loans or making designated savings. For companies, Section 115BAA offers a flat concessional tax rate of 22% (effective ~25.17% including surcharge and cess) subject to foregoing chapter VI-A deductions and MAT.

Question 5

What happens if a company receives a notice under Section 148 for reassessment?

Accepted Answer

A Section 148 notice signifies the tax department has reason to believe income chargeable to tax has escaped assessment. Taxpayers must inspect the recorded reasons under Section 148A, file formal objections within the statutory timeline (usually 30 days), and present certified books of accounts before an order under Section 148A(d) is passed.

Question 6

When is a Tax Audit under Section 44AB mandatory?

Accepted Answer

A Tax Audit is mandatory for businesses whose total turnover exceeds ₹1 Crore in a fiscal year. However, if cash receipts and cash payments do not exceed 5% of aggregate transactions, the threshold is elevated to ₹10 Crores. For professionals, the threshold is ₹50 Lakhs (or ₹75 Lakhs under presumptive conditions).

Question 7

What are the legal steps to incorporate a Private Limited Company in India?

Accepted Answer

1) Obtain Digital Signature Certificates (DSC Class 3) for proposed directors; 2) Reserve company name via MCA SPICe+ Part A; 3) File SPICe+ Part B incorporating MoA, AoA, PAN, TAN, EPFO, ESIC, Professional Tax and bank account opening; 4) Receive Certificate of Incorporation (COI); 5) File INC-20A (Commencement of Business) within 180 days after capital subscription deposit.

Question 8

What are the penalties for delayed filing of MCA forms AOC-4 and MGT-7?

Accepted Answer

Delayed filing of financial statements (AOC-4) and annual returns (MGT-7/7A) attracts a statutory additional fee of ₹100 per day per form without any upper monetary ceiling. Persistent defaults also risk director disqualification under Section 164(2) and strike-off proceedings by the Registrar of Companies.

Question 9

Can our firm outsource the entire accounting and CFO function to your team?

Accepted Answer

Yes, our Virtual CFO practice acts as your outsourced finance department, providing a dedicated senior accountant, monthly MIS KPI reporting packages, payroll administration, and a supervising Chartered Accountant for monthly governance reviews.

Question 10

What documentation is required to initiate a statutory or internal audit?

Accepted Answer

We require trial balances, general and sub-ledgers, fixed asset registers, bank statements, board minutes, statutory return copies (GSTR-3B/9, ITR, TDS), and previous year audit reports along with standard management representation letters.

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