readymade companies in india
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PRESENTATIONon
DOING BUSINESSIN INDIA
Registered office:SCO 35, Second Floor, Sector -26, Chandigarh
160 019Tel- 91-1 2-2 90366, 2 900 5, Fa!-91-1 2-
2 90260, "o#ile-09$1%0112 $&'ail: ra'an(ra'anaggar)al*co'
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WELCOME
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ABOUT ARAARA is a firm of chartered acco ntants!
ARA firm "as formed in the #$%% &'' (ears) !
ARA firm *ro+ide Ser+ices in the area of A dit, Ta- &Direct, indirect) andAd+isor(!
ARA team is com*rised of more than '. m /ti dis*/ined *rofessiona/s s chas Chartered Acco ntants, Com*an( Secretar(, La"(ers, Cost Acco ntantsand MBA0s!
ARA ha+e state of the art faci/it( in Chandi1arh, Ne" De/hi 2 P ne !
ARA ha+e more then #33 Cor*orate C/ients and /eadin1 MNC0s &for USA, U4,5a*an, Midd/e East, E ro*e) !
Mr! Raman A11ar"a/, the CEO 2 6o nder em*ane//ed "ith the 7Office ofOfficia/ Li8 idator9 attached "ith the :i1h Co rt of P n;a
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SER=ICES 2 SOLUTIONSAUDIT AND ASSURANCE
TA> 2 REGULATOR? SER=ICES
SPECIALIT? SER=ICES
Settin1 * Ne" B sinessIncor*oration of a Limited Com*an(Settin1 * of STPI Unit and MaintenanceSettin1 * of SE@ UNIT and MaintenanceDoin1 B siness in IndiaDoin1 B siness O tside IndiaSettin1 * Offshore Com*aniesInternationa/ E-ec ti+e Ser+icesB siness Re1istrationsInte//ect a/ Pro*ert(Pa(ro// Ser+icesCor*orate Secretaria/ Ser+ices
=irt a/ Office Ser+ices4PO Acco nts and Ta- O tso rce Ser+ices
INTERNATINOL TA>ATION
6INANCIAL AD=ISOR? SER=ICES
LEGAL SER=ICES
OUTSOURCING SER=ICES
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TEAMS!NO NAME UALI6ICATION E>PERIENCE
# Mr! Raman A11ar"a/ 6e//o" CharteredAcco ntant
'. ?ears in Acco nts, 6inance,Ta-, Le1a/, Mana1ement etc!
' Mrs! Sim*( G *ta Bache/or in La"! 2Com*an( Secretar(
#. ?ears in Le1a/ 2 Cor*orateaffairs
Mr! Sameer Sa"r * 6e//o" CharteredAcco ntant
# ?ears in Acco nts, 6inance,Ta-, Le1a/, Mana1ement etc
Mr! Unni 4rishnan Grad ate #% ?ears e-*erience in Cor*orateAffairs
. Ms! Arti Post Grad ate $ (ears e-*erience in Re1 /ator(Com*/iances
Mr! San;a( A11ar"a/ Chartered Acco ntant #% ?ears Acco nts, 6inance 2 Ta-
F Mr! S man Master in Commerce # ?ears in Acco nts, 6inance,Ta-, Le1a/, Mana1ement etc
% Mr! =ineet Tha ra/ Master in La" 2Mana1ement
' ?ears Ta- and Re1 /ator(
$ Ms! Manmeet 4a r Masters in La" ?ears Le1a/
#3 Mr! Ni hi/ =ats Bache/or in La" ' ?ears Le1a/
## Ms! Nee/am Bache/or in La" ?ears Le1a/
#' Ms! Moon Rana Bache/or in La" ' ?ears Le1a/
More than #. other Professiona//( a/ified S **ort Staff
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DOING BUSINESS ININDIA
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6OREIGN DIRECT IN=ESTMENT ININDIA
AUTOMATIC ROUTE
APPRO=AL ROUTE
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ENTRY STRATEGY
5OINT =ENTURE
W:OLL? OWNED SUBSIDIAR?
BRANC: O66ICE
AGENC?
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6ORMS O6 ENTERPRISES IN INDIA
INCORPORATED ENTIT?Pri+ate Limited Com*an(
P
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T?PE O6 SECURITIES
E8 it( Share
Preference Share
De
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LAWS GO=ERNING BUSINESS ININDIA
The Com*anies Act! #$.Ar
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IMPORTANT REGULATOR?AUT:ORITIES 6OR 6OREIGNIN=ESTMENT
Secretariat for Ind stria/ Assistance &SIA)
6orei1n In+estment Promotion Board &6IPB)
The 6orei1n In+estment Im*/ementation A thorit( &6IIA)
Reser+e Ban of India &RBI)
Re1istrar of Com*anies &RoC)
Sec rities and E-chan1e Board of India &SEBI)
Centra/ Board of E-cise and C stoms &CBEC)
Centra/ Board of Direct Ta-es &CBDT)
A thorit( for Ad+ance R /in1s &AAR)
In+estment Commission
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DIRECT TA>ES
INCOME TA>
DI=IDEND DISTRIBUTION TA>
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INDIRECT TA>C stoms d t(
CEN=AT &e-cise d t()
Centra/ Sa/es ta-
=a/ e added ta-
Ser+ice ta-
Octroi d t(Hentr( ta-
Stam* D t(
R2D cess
Wor s contract ta-
T rno+er ta-
P rchase ta-
Secondar( and hi1her ed cation cess
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INTERNATIONAL TA> TREATIES
Treaties "ith fa+ora
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IMPORTANT :R STATUTES
TRAINING, RECRUITMENT AND SCREENING
Em*/o(ment e-chan1es &Com* /sor( notification of+acancies) act, #$.$
The *a(ment of 1rat it( act, #$F'
The a**rentices act, #$ #
Contract /a
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EMPLO?MET TERMS, CONDITIONS AND BENE6ITS
6actories act, #$ %
Sho*s and commercia/ esta
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INTELLECTUAL PROPERT?
Patents
Co*( Ri1hts
Trade Mar s
Trade Secretes
Geo1ra*hica/ indication of 1oods
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ACCOUNTS AND AUDIT
Indian Acco ntin1 Standards
A dit and Ass rance Standards
G idance notes
Standards on interna/ a dit
O*inion of e-*ert ad+isor( of ICAI
I6RS to
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REPORTINGRE UIREMENTS
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INCOME TA>
Ann a/ Ta- Ret rn
arter/( "ithho/din1 ta- ret rn
Acco ntant re*ort nder of transfer *ricin1 r /e
Ta- a dit re*ort
Acco ntant re*ort in case of MAT
Acco ntant re*ort in case of STPIHEOUHSE@
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COMPAN? LAW
6i//in1 of ann a/ a dited financia/ statements
6i//in1 of ann a/ ret rn
6i//in1 of doc ments in case of
Chan1e of DirectorChan1e of Ca*ita/Chan1e of Re1istered OfficeRe1istration of Char1e
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E>C:ANGE CONTROL LAWHRBI
Intimation to RBI from recei*t of ca*ita/
Intimation to RBI from the date of a//otment of shares
Ann a/ ret rn to RBI
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SER=ICE TA> LAW
Month/( de*osit of ta-
:a/f (ear/( ta- ret rn
Ref nd of Ser+ice Ta- "ithin # (ear
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STPI
Month/( *ro1ress re*ort
Ann a/ ret rn
6i//in1 of Softe- form
Reim< rsement of CST on ha/f (ear/(
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=ATHCST
Month/(H arter/( ret rn
Ann a/ ret rn
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E>TRACTION O6 EARNINGS OUTO6 INDIA
Di+idend
B (
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E>IT STRATEG?
Disso/ tion of com*an(
Sa/e of share
Mer1erHAma/1amation
IPO
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INCOME TA> LAW AT A
GLANCEIN
INDIA
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INCOME TA> AT A GLANCE
C:ARGEABILIT?
Income arisin1 or accr in1 or recei+in1 in India inc/ din1s*ecified deemin1 income
TA> RULE
Resident R /eSo rce R /e
TA> PA?ER T?PE
Residents
Non ResidentsResident < t not Ordinari/( Resident
COND Ne-t S/ide
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SCOPE
Wor/d"ide Income Ta-a
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E>EMPTIONS AND DEDUCTIONS
=ario s s*ecified e-em*tions and ded ctions are a//o"ed PA?MENT Se/f Assessment &at the time of fi/in1 ta- ret rn)Ad+ance Ta- & to insta//ments on estimated
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ASSESSMENT PROCEDURE
Acce*ted as s ch &If not se/ected for a dit "ithin si- months from the end of AH? )Se/ected for Scr tin( &A dit)
TIME PERIOD 6OR ASSESSMENT
# (ear from the end of AH? if not se/ected for A dit' (ears from the end of AH? if se/ected for A dit
REASSESSMENT PROCEDURE
If income esca*ed ta-ation or "ron1 information
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RE=ISION O6 ORDER B? COMMISSIONER
Within ' (ears from the end of the 6H? in "hich order "as*assed
RE=ISION O6 ORDER B? COMMISSIONER I6 TA> PA?ERRE UESTED
Within # (ear from the end of the 6H? in "hich order "as*assed
RE6UND
Ta- *a(er is entit/ed to ref nd of e-cess ta- de*osited "ithinterest J K *er ann m
INTEREST
Interest J #'K *er ann m for de/a( in fi/in1 ret rn, de*osit ofta- etc!
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PENALTIES
Ma-im m 33K of ta- amo nt
PROSECUTION
Wi//f / attem*t to e+ade ta-Wi//f / fai/ re to fi/e ta- ret rnWi//f / fai/ re to fi/e doc ments and acco nts6a/sification of
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Appellant Authorities
There are 4 level of appellant authorities :-1) Commissioner of Income Tax (within Tax dept)2) Income Tax Appellant Tri unal ( !ower Court )
") #i$h Court4) %upreme Court of India
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WEALT: TA>
I6 TA>ABLE WEALT: E>CEEDS RS! MILLION
WEALT: TA> J #!3 K
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INCOME TA> TABLE
Domestic Com*an( !$$K
6orei1n Com*an( '!' K
Di+idend distri< tion ta- # !$$.K
Ca*ita/ 1ains ta- on e-it orrestr ct rin1
3K to '!' K &/on1Hshortterm)
Withho/din1 Ta-es Na11in1 *ro
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NEW DIRECT TA> CODE
TA>ATION O6 COMPANIES
Com*anies '.K Branch *rofit ta- #.K
GAAR Introd ce
Treat( O+erride Introd ced
Short TermHLon1 Term Ca*ita/ 1ains J 3K
Residence r /e for com*anies P/ace of contro/ andmana1ement, "ho//( or *art/( in India, at an( time in the(ear
Wea/th ta- J 3!'.K &
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TA> RATE COMPARISION
Cor*orate Income
Ta- Rate
3K '.K
Minim mA/ternati+e Ta-
#.K &of
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INTERNATIONAL TA>ATIONAT A
GLANCE
INTERNATIONAL TA> AT A
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INTERNATIONAL TA> AT AGLANCE
A// *a(ments in the nat re of char1ea
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DOUBLE TA>ATION TREAT?BETWEEN INDIA 2 USA
RATE
DI=IDEND NIL
INTEREST #3 #.K
RO?ALT? #3K in case of se of Ind stria/, Commercia/
and Scientific E8 i*ment #.K if *a(er is Go+ernment or S*ecified
Or1ani ation'3K in other Cases
6EE 6OR INCLUDED #3K in case of se of Technica/ or Cons /tin1
SER=ICES Ser+ices, Anci//ar( 2 S
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TRANS6ER PRICING LAW
IN INDIA
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INTRODUCTION TO TRANS6ERPRICING
+n +ndia, Transfer ricing reg lations )ere introd ced fro' ./ril 1,2001as a 'eas re to c r# ta! a oidance*
.n +nco'e arising fro' an international transaction to #e co'/ tedat the arm0s /en1th *rice &ALP)!
The Central oard of irect Ta!es has set / a se/arate cell for dealing)ith cases of transfer /ricing
SOURCE
O&C g idelines
4S reg lations and ris/r dence
+ndian ris/r dence
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ARM0S LENGT: PRINCIPLE
7 here an enter/rise enters into transactions )ith associated enter/rises, in order to deter'ine fair /rofit of that enter/rise, the /rice of the transactions sho ld #e co'/ared )ith those entered into # t)o inde/endent enter/rise nder ncontrolled conditions and nder si'ilar circ 'stances*7
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APPLICABILIT?
INTERNATIONAL TRANSACTIONS
ASSOCIATED ENTERPRISES
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P rchase
Sa/e
Lease of tan1i
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ASSOCIATED ENTERPRISES
PRIMAR? ASSOCIATION
"anage'ent8Control8Ca/ital
SECONDAR? ASSOCIATION
Direct or indirect +otin1 *o"er of at /east ' K
Common *arent ho/ds +otin1 *o"er of at /east ' K in
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STEPS 6OR DETERMINATION O6ALPSTEPS IN=OL=ED IN T:E DETERMINATION O6 T:E ALP
+dentification of the 7Internationa/ Transaction9
+dentification of an 7Uncontro//ed Transaction9
+dentification and co'/arison of s/ecific characteristics of the t)otransactions &Com*ara
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MET:ODS The s*ecific methods *rescri
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TRADITIONAL TRANSACTIONMET:OD
COMPARABLE UNCONTROLLED PRICE MET:ODUnder this method, the first ste* is to identif( the *rice char1ed or*aid for *ro*ert( transferred or ser+ices *ro+ided in a com*ara
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enter*rise in connection "ith the said transaction! Then s ch *riceis to
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TRANSACTIONAL PRO6IT MET:ODPRO6IT SPLIT MET:ODUnder this method, the first ste* is to determine the com
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SUMMAR? O6 MET:ODSMethods Prod ct
Com*ara
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SELECTION O6 MOSTAPPROPRIATE MET:OD
T:E MOST APPROPRIATE MET:OD S:ALL BE SELECTED :A=ING REGARD
TO T:E 6OLLOWING
The nat re and c/ass of the internationa/ transaction
The c/ass or c/asses of associated enter*rise enterin1 into thetransaction and the f nctions *erformed
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COMPARABILIT? 6ACTORS6OR COMPARING AN INTERNATIONAL TRANSACTION WIT: ANUNCONTROLLED TRANSACTION, RE6ERENCE S:OULD BE MADE TOT:E 6OLLOWING
The s*ecific characteristics of the *ro*ert( transferred or ser+ices*ro+ided in either transaction
The f nctions *erformed, ta in1 into acco nt assets em*/o(ed orto
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TRANS6ER PRICING AUDIT
Limit of Rs! . Crores has
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ASSESMENT PROCEDURE 6i/e ta- ret rn 2 Acco ntant0s Re*ort & 3th Se*tem
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REPORTING RE UIREMENTS
& er ta! /a er entering into international transaction to o#tainedan acco ntant re/ort in /rescri#ed for' i*e* For' 3C& *
& er acco ntant re/ort to #e s #'itted on or #efore the d e datefor filing ta! ret rn
.cco ntant re/ort contain the follo)ing infor'ation
Contains s mmar( of internationa/ transaction
Contains detai/s of ta- *a(er
Contains method em*/o(ed to determine ALP
DOCUMENTATION
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DOCUMENTATION ENTIT? RELATED PRICE RELATED TRANSACTION
RELATEDProfi/e of ind str(
Profi/e of 1ro *
Profi/e of Indian
entit(
Profi/e ofassociatedenter*rises
Transaction terms
6 nctiona/ ana/(sis&f nctions, assetsand ris s)
Economic ana/(sis&method se/ectin1,com*ara
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PENALT?
DE6AULT NATURE O6 PENALT?
In case of a *ost in8 ir(ad; stment, there is deemed to
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4E? ISSUESHCONTRO=ERS?Use of secret com*ara
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TA4E AWA?Ad; stment a//o"ed
Wor in1 ca*ita/Ris sGro"thIPUnder ti/i ation of ca*acit(
Difference in acco ntin1 *o/icies
Loss ma in1 com*ara
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Se1menta/ res /ts to
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RESOLUTION PROCESS
TransferPricin1 Officer
Dis* teReso/ tion
Pane/
A**e//ateTri< na l :i1h Co rt S *remeCo rt
Order /assed)ithin 1 'onthfro' end of the'onth in )hichdirection fro'is/ te
Resol tion anelis recei ed orend of 9 'onthfro' the end of'onth in )hichdraft order isfor)arded*
irection to#e iss ed)ithin 9'onth fro'the end of the'onth in)hicho# ection arefor)arded
Final factfindinga thorit
o s/ecificti'e li'it
;enerallorder/assed)ithin 2 < %ears fro'filing ofa//eal
Re en ecan also goon a//eal ifCo''issioner decidesin fa or of
Final fact findinga thorit
o s/ecific ti'eli'it
;enerall order/assed )ithin 2