September 3, 2024

Karnataka is India’s 6th largest state by area. It houses an extensive road network spanning 91959.80 km composed of major district roads and national and state highways. Most of its population relies on public transport or private vehicles to make their commute within the state.  This southern state also experiences yearly increases in its traffic density, with more people visiting or moving to the state. To keep up with logistical needs, the state must continuously maintain its road networks by sustaining existing roads and building new ones.   To fund this, the government imposes a road tax in Karnataka on all residents within the state who intend to use its roads. Therefore, anyone that owns a vehicle in Karnataka or plans to visit this state in their private vehicle must pay this tax. Once paid, they can drive freely within the state for up to 15 years.  Karnataka Motor Vehicles Taxation Act The road taxes for two-wheelers and four-wheelers that are registered in Bangalore are determined by Karnataka Motor Vehicles Taxation Act. The act was implemented in 1957 and this has undergone several improvements. Karnataka Vehicle Tax Calculation Vehicle taxes in Karnataka are calculated depending on the vehicle’s age, cost, the original date of registration, seating capacity and engine capacity. In addition to this, the purpose of the vehicles and the place in which it was manufactured are considered while calculating the taxes. Taxes Levied on Two Wheelers As per the taxation guidelines, the tax charged on two-wheelers is dependent on the cost and age of the vehicle. Vehicle Category Applicable Tax New two-wheeler pricing below Rs. 50,000 10% of the cost of the vehicle New two-wheeler pricing between Rs. 50,000 and Rs. 1,00,000 12% of the cost of the vehicle New two-wheeler pricing above than Rs. 1,00,000 18% of the total cost of the vehicle New two-wheeler that runs on electricity   4% of the cost total of the vehicle Used two-wheelers that are not more than 2 years 93% of the cost of the vehicle Used Two Wheelers that are more than 3 years but not more than 4 years 81% of the cost of the vehicle Used Two Wheelers that are more than 4 years but not more than 5 years 75% of the cost of the vehicle Used Two Wheelers that are more than 5 years but not more than 6 years 69% of the cost of the vehicle Used Two Wheelers that are more than 6 years but not more than 7 years 64% of the cost of the vehicle Used Two Wheelers that are more than 7 years but not more than 8 years 59% of the cost of the vehicle Used Two Wheelers that are more than 8 years but not more than 9 years 54% of the cost of the vehicle Used Two Wheelers that are more than 9 years but not more than 10 years 49% of the cost of the vehicle Used Two Wheelers that are more than 10 years but not more than 11 years 45% of the cost of the vehicle Used Two Wheelers that are more than 11 years but not more than 12 years 41% of the cost of the vehicle Used Two Wheelers that are more than 12 years but not more than 13 years 37% of the cost of the vehicle Used Two Wheelers that are more than 13 years but not more than 14 years 33% of the cost of the vehicle Used Two Wheelers that are more than 14 years but not more than 15 years 29% of the cost of the vehicle Used Two Wheelers that are more than 15 years 25% of the cost of the vehicle   Taxes Levied on Four Wheelers As per the taxation guidelines, the taxes levied for four-wheelers depends on the use of the vehicle and its classification. The vehicles that come under this section include cars and jeeps that are bought for personal use having a floor area up to 5 square meters. Vehicle Category   Applicable Tax A new vehicle that costs less than Rs. 5 lakhs 13% of the cost of the vehicles New vehicles that cost Rs. 5 lakhs to Rs. 10 lakhs 14% of the cost of the vehicles New vehicles that cost Rs. 10 lakhs to Rs. 20 lakhs 17% of the cost of the vehicles New vehicles that cost more than Rs. 20 lakhs 18% of the cost of the vehicles Vehicles that run on electricity 4% of the cost of the vehicles Vehicles that are below 5 years old 75% to 93% as per clause A Vehicles that are 5 years to 10 years old   49% to 69% as per clause A     Vehicles that are up to 10 to 15 years old 45% to 25% as per clause A Besides these taxes, there is a separate tax that is levied in the classic and vintage cars that are registered in Karnataka. This is a lifetime tax that has to be paid only once. For Classic cars, it is Rs. 1000 For vintage cars, it is Rs. 500 Taxes on Imported Vehicles Taxes for vehicles that are imported include the cost of the vehicle, the customs duty that area applicable and other costs charged for bringing the vehicle to the state for sale. Taxes on Vehicles Registered in Other States If a vehicle operating in Karnataka is registered in other State, then the vehicle owner need pay lifetime tax unless the vehicle is used in the state for more than a year. FAQs What is Karnataka Vehicle Tax? Karnataka Vehicle Tax, also known as road tax, is a tax imposed by the Karnataka government on vehicles registered in the state. This tax is used to maintain and develop road infrastructure. Who is required to pay vehicle tax in Karnataka? All vehicle owners in Karnataka must pay vehicle tax. This includes both new and old vehicles, whether they are for personal or commercial use.

GST search by PAN tool is a powerful and user-friendly feature designed to help businesses and individuals verify the GST registration details of their suppliers or customers quickly and easily. What is GSTIN? GSTIN is the GST identification number or GST number. A GSTIN is a 15-digit PAN-based unique identification number allotted to every registered person under GST. As a GST-registered dealer, you might want to do a GST verification before entering it into your GST Returns.  Why is it necessary to verify the GST Number? A GSTIN or GST number is public information. GST search by name is an important task that every business dealing with GST-registered taxpayers must carry out to ensure the authenticity of the vendor and the GSTIN or GST number being used in the invoice. You can partly verify the GSTIN or GST number on the first look by checking if the vendor’s PAN number matches with the digits between 3 and 10 in the GSTIN. It is also necessary to carry out a thorough check of the GSTIN authenticity to avoid generating incorrect invoices and e-invoices, to claim a genuine input tax credit, and to pass on the tax credits to rightful buyers, Search GST Number/GSTIN by PAN (Permanent Account Number) Goods & Service Tax Identification Number (GSTIN) is a state-specific unique number based on PAN. GSTIN is a 15 digits registration number consisting of state code, PAN, entity code, and the check digit. GSTIN of a person can be identified based on PAN by following the below procedure: Step 1– Visit the GST portal Step 2– Click on “Search Taxpayer” tab.  Step 3– Select “Search by PAN” option. Step 4- To use the GST number search tool, enter the PAN number of the dealer and captcha code reflecting on the screen. Step 5- Click on “Search”. The website will show the details of the GSTIN registration held against the PAN which has been provided.  Step 6- Upon clicking any one of the hyperlinked GSTIN, the page redirects to ‘Search by GSTIN’ with the GSTIN auto-filled.  Step 7- Enter the captcha code and click on the ‘Search’ button. Further details of the business registered with the specific GSTIN gets displayed.  FAQs How to search GST Number / GSTIN by PAN of business in India? Enter the PAN of the business, to search the GST number or GSTIN. GSTIN or GST Identification Number is allotted on the basis of PAN and State of the taxpayer. The 3rd to 12th digit of a GSTIN is the PAN of the business. Is PAN compulsory to obtain GST Number / GSTIN in India? Yes. PAN (Permanent Account Number) is mandatory to apply for GST Registration and get GSTIN (GST Identification Number) in India. The 3rd to 12th digit of GSTIN is the PAN of the taxpayer. However, in the case of the non-resident taxable person, PAN is not mandatory and registration can be granted on the basis of an alternate prescribed document. Therefore, you can use the PAN of the business to search GST details like GSTIN / GST Number of a business.

In India, legal metrology is the New name of Standards of Weights and Measures. The Standard of Weights and Measures Act,1976 was enacted primarily to establish standards of weights and measures, to regulate trade or commerce in weights, measures and other goods that are sold or distributed by weight, measure or number. It is based on the metric system and international system of units recognized by OIML–International Organization of legal metrology. India is one of the members of OIML. This Act was subsequently replaced by the Legal Metrology Act, 2009 with the aim of protecting consumer interests and other stakeholders including industry. Regulatory Requirements relating to Food Businesses The Legal Metrology (Packaged Commodities)Rules ,2011were prescribed in order to regulate pre-packaged commodities. Under the said rules, pre-packaged commodities are required to comply with certain mandatory labeling requirements w.r.t net quantity, MRP and Customer care information. With view to encourage ease of business operations, amendments in packaged commodity rules have been notified in 2017, harmonizing the labeling provisions w.r.t Food products with the Regulations as laid down under the Food Safety & Standard Regulations (FSSR) 2017. Legal Metrology Act 2009 – An overview In today’s complex marketplace, ensuring fair trade practices and protecting consumer rights are vital elements for any thriving economy. In India, the Legal Metrology Act of 2009 stands as a crucial legislation that aims to establish transparency, accuracy, and uniformity in weights, measures, and packaging of goods. The Act, along with its subsequent rules and regulations, creates a strong framework to safeguard the interests of consumers and promote equitable business practices. This article provides an insightful overview of the Legal Metrology Act 2009 in India, highlighting its key objectives, administration, provisions, penalties, and appeal. The Legal Metrology Act, 2009 (hereinafter referred as Act) replaced the Standards of Weights and Measures Act, 1976, and the Standard Weights and Measures (Enforcement) Act, 1985. The Act contains five chapters and 57 Sections, stipulating that the  base units of weights and measures specified in the Act shall be standard units of weights and measures throughout India. The Weights and Measures Unit of Legal Metrology is a division managed under the Ministry of Consumer Affairs, Food, and Public Distribution’s Department of Consumer Affairs, Government of India. In India the authority and duty to maintain weights and measures rules, regulations and proper implementation of weights and measures lies on both, the Centre and the States. Matters of National Policy and other related functions such as, uniform laws on weights and measures, technical regulations, training, precision laboratory facilities and implementation of the International Recommendation are the concern of the Central Government. In addition, it has to guide, coordinate and supervise the enforcement activities of the state enforcement machinery. The State Governments and Union Territory Administration are responsible for the day to day enforcement of the laws. Administrative Roles The Directorate of Legal Metrology in each state is in charge of enforcing the Legal Metrology Act. The Directorate is essentially a three-tier organisation comprised of the Inspector of Legal Metrology at the field level, Assistant Controllers of Legal Metrology at the district level, and the Controller of Legal Metrology with four Deputy Controllers sitting at the state level. Penalties Offences relating to weights and measures are punished with fine or imprisonment or with both depending on the offence committed. Here are few common illegal activities and their penalties implied: Altering the weights and measures of the products is punished with a fine extending up to Rs 50,000. On the second or subsequent offence, imprisonment for a term not less than 6 months, extending up to 1 year or with fine or both. [Section 26] Manufacturing or sale of non-standard weights or measures is punished with fine up to Rs 20,000 or imprisonment extending up to 3 years on second or subsequent offence or both. [Section 27] Demanding or receiving any article or thing on service that is in excess or less than the quantity specified by contract or agreement is punished with a fine extending up to Rs 10,000. On second or subsequent offence, imprisonment extending up to 1 year or with fine or both. [Section 30] Sale or delivery of commodities, etc. by non-standard weight or measure is punished with a fine not less than Rs 2000 extending up to Rs 5000. On second or subsequent offence, imprisonment for term not less than 3 months extending up to 1 year, or with fine, or both. [Section 34] Selling, etc., of non-standard packages is punished with a fine up to Rs 25,000. On second offence extending up to Rs 50,000, for subsequent offence, with fine not less than Rs 50,000 extending up to Rs 1,00,000 or with imprisonment for a term extending to 1 year or with both. [Section 36 (1)] Manufacturing or packing or importing with error in net quantity is punished with imprisonment for a term extending up to 1 year or with fine extending up to Rs 10,000 or both. [Section 36(2)] Sale of any commodity in packed form at a price exceeding the Maximum Retail Price is punished with fine up to Rs 2,000 [Rule 32(2) of Legal Metrology (Packaged Commodities) Rules, 2011] Destroy or erase to alter the MRP indicated by the manufacturer or packer or importer is punished with a fine of Rs 2,000. [Rule 32(2) of Legal Metrology (Packaged Commodities) Rules, 2011] What Are Pre-Packaged Commodities for Legal Metrology Registration? LMPC basically applies to the pre-packaged commodities and weights and measurements in India. Pre-packaged commodities include all those commodities that are packaged before becoming commercially available. In simpler terms, it includes all those commodities that are packed in the absence of the consumers. Therefore, the contents in the package are pre-determined. Following are some of the commodities and products covered under the legal metrology law: Cooking Oil Detergent Powders and Milk Soaps Mineral and Drinking Water Suji, Rawa, Wheat Flour, Rice Flour Coffee and Tea Biscuits, Baby Food, Bread Cement in Bags Enamels, Varnish, Paint Soft Drinks and Non-Alcoholic Beverages How to Apply for

The Companies Act, 2013 (‘Act’) introduced the concept of small companies to provide advantages for small businesses operating as private limited companies. Small companies have less annual revenue compared to regular-sized companies. In a developing country like India, small companies play a significant role in generating profits and boosting employment. Thus, they are the backbone of the economy. Small companies do not have any separate procedure to obtain registration under the Act. It is registered as a private limited company. But the Act differentiates a private company as a small company based on its less amount of investment and turnover. The Ministry of Corporate Affairs (MCA), on September 15th, 2022, issued the Companies (Specification of Definitions Details) Amendment Rules, 2022. The definition under the Companies Act for Small Companies has now been revised by increasing their thresholds for Paid-up capital and Turnover.  The paid-up Capital and Turnover of the small company shall not exceed Rupees 4 Crores and Rupees 40 Crores, respectively. Revisions to the definition were aimed at simplifying business and reducing compliance burdens for many companies. The current article briefs the Revised Definition of a Small Company as per Companies (Specification of Definition details) Amendment Rules 2022. MCA Notification The following amendment has been made in the Companies (Specification of Definition details) Amendment Rules 2022: A new clause 2(1)(t) has been substituted in Rule 2, which specifies the Definitions of Small Company. As mentioned above, the definition of a Small Company under the Companies Act, 2013 has now been revised by increasing the thresholds for Paid-up capital and Turnover. The said amendment is made effective from September 15th, 2022. Small Companies To provide advantages to small businesses operating as private limited companies, the Companies Act 2013  introduced the concept of small companies. The annual revenue of small companies is lower than that of regular-sized companies. India’s small companies are crucial to generating profits and creating jobs. Consequently, they are the economy’s backbone. In accordance with the Companies Act, small businesses need not follow a separate company registration procedure, and it is registered as a private limited company. But the Act differentiates a private company from a small company based on its fewer amounts of investment and Turnover. New Definition of a Small Company The Finance Minister proposed a revised definition of a small company while presenting the Union Budget 2021. The revised definition came into effect on 1 April 2021. The MCA further amended the definition of a small company on 15 September 2022. The purpose behind the revised definition was to provide ease of doing business and reduce the compliance burden for many companies. Accordingly, the Ministry of Corporate Affairs (MCA) notified the Companies (Specification of Definitions Details) Amendment Rules, 2022, to amend the old definition of a small company. The new definition is effective from 15 September 2022. The new amended definition of a small company is provided under Section 2(85) of the Companies Act, 2013. The Act defines a small company as a company that is not a public company and has: A paid-up share capital equal to or below Rs.4 crore or such a higher amount specified not exceeding more than Rs.10 crores. A turnover equal to or below Rs.40 crore or such a higher amount specified not exceeding more than Rs.100 crore. However, the concept of small companies does not apply to the following companies: A holding or a subsidiary company. A company registered under section 8 of Companies Act. A body corporate or company governed by any special act. Most startups in India are classified as small companies as they will not have a paid-up capital of more than Rs.4 crores and an annual sales turnover of more than Rs.40 crores. Comparison of Small Company New Definition with Old Definition The amendment to the definition of a small company increased the maximum limit of paid-up capital and turnover. The limits were increased so that more companies could be covered within the ambit of a small company, making them eligible to get the benefits of a small company provided under the Companies Act 2013. The comparison of the old and new definitions of a small company is provided below: Particulars Old Definition Criteria New Definition Criteria Paid-up share capital Maximum paid-up share capital of Rs.2 crore Maximum paid-up share capital of Rs.4 crore Turnover Maximum turnover of Rs.20 crore Maximum turnover of Rs.40 crore Benefits of Revised Definition of Small Companies Small companies are exempted from the essential to prepare cash flow statements as part of financial statements.  Advantages of preparing and filing an Abridged Annual Return. The small company will not be required to have the compulsory rotation of auditors. An Auditor of a small company does not need to report on the adequacy of the internal financial controls and its operating effectiveness in the auditor’s report. The small company can hold only two board meetings in a year. Annual company returns can be signed by the company secretary, or where there is no company secretary, by a company director. In addition, small companies are subject to fewer penalties. Key Features of Small Company Financial Flexibility: Small companies, operating under the redefined thresholds, experience increased financial flexibility. With a maximum paid-up capital of Rs.4 Crores, these entities can strategically allocate resources to navigate economic fluctuations. Operational Agility: The adjusted turnover limit of Rs.40 Crores empowers small companies with heightened operational agility and allows for swift responses to market demands, fostering growth and expansion. Reduced Compliance: Small companies, defined by the new criteria, benefit from reduced and streamlined compliance processes. Navigating regulatory requirements becomes more straightforward, reducing administrative burdens and allowing a sharper focus on core business operations. FAQs What is the Small Company Definition for FY 2021-22? The small company definition for FY 2021-22, as per the Companies Act, 2013, has been updated to incorporate new limits. It now sets thresholds for paid-up capital and turnover, as INR 4 Crores and INR 40 Crores respectively. What Differentiates a Small Company from Other Business Entities? A small company, as per the Companies Act, is distinguished by specific criteria of paid-up capital and turnover limits of INR

Every company is required to file the Audited financial statement and annual return as per The Companies Act, 2013 within 30 days and 60 days respectively from the conclusion of the Annual General Meeting date. Filing of an Audited financial statement is governed under Sections 129 and 137 of The Companies Act, 2013 read with Rule 12 of the Company (Accounts) Rules, 2014 and annual return is governed under Section 92 of the Companies Act, 2013 read with Rule 11 of the Companies (Management and Administration) Rules, 2014. ROC filing ROC filing is a mandatory requirement for all companies registered in India, and companies are required to file various forms, returns, and documents with the ROC regularly. ROC filing includes the following: Annual financial statements Annual returns As per sections 129 and 137 of the Companies Act 2013, every Company should file audited financial statements with the ROC. Similarly, under section 92 of the Companies Act 2013, the annual returns must be submitted to the ROC. Why ROC Filing is Important? Compliance with the Law: Meeting the ROC filing obligations is essential for businesses to uphold their legal status. Not meeting the deadlines for submitting required documents can result in penalties, fines, or even the dissolution of the company. Adhering to these rules demonstrates a company’s dedication to transparent and accountable business operations. Equitable Financial Reporting: ROC filing encompasses submitting financial statements like balance sheets, profit and loss accounts, and cash flow statements. These reports offer stakeholders such as investors, creditors, and government bodies an exact overview of the company’s financial performance. Clear financial reporting boosts investor trust and bolsters the company’s standing. Blocking Legal Effects: Meeting ROC filing requirements shields companies from legal consequences stemming from non-compliance, safeguarding them against potential legal actions and fostering a seamless operational environment. Availability of Business Financing and Loans: Before extending loans or funding, financial institutions and investors frequently seek access to a company’s financial statements and compliance records. ROC filing allows businesses to demonstrate their financial stability and creditworthiness, thereby enhancing their prospects of securing loans and drawing investments. Developing Trustworthiness: Consistently submitting financial statements to the ROC exhibits a company’s credibility and dependability. This, in effect, can entice potential clients, customers, and partners, nurturing business growth and facilitating expansion Due Date for ROC filing Every Company must file the financial statement form within 30 days of the annual general meeting. The annual returns company with a share capital must be filed within 60 days of the Company’s annual general meeting. Amount of penalty levied on late ROC filing The penalty amount is directly proportional to the number of days the applicant delays. Following is the amount of penalty: Sl.No Period of Delay Penalty   1 Up to 30 days delay Two times of regular filing fee 2 More than 30 days and up to 60 days Four times of regular filing fee 3 More than 60 days and the upto 90 days Six times of regular filing fee 4 More than 90 days and upto 180 days Ten times of regular filing fee 5 More than 180 days twelve times of regular filing fee Documents Required for ROC Annual Filing Every company has to attach some documents important while filing the ROC and including: Balance-Sheet: Form AOC-4 is to be filed by all companies while ROC filing Profit & Loss Account: Form AOC-4 is to be filed while ROC filing by all companies Annual Return: MGT 7 and MGT 7A to be filed by companies Cost Audit Report:  Form CRA 4 to be filed by the companies E-Forms are Required to be Filed with ROC Name of E-form Purpose of E-form Attachments Due date of filing Applicability on Company Form ADT-1 Appointment of Auditor Appointment Letter, Confirmation Letter from Company Private Companies, Public Limited Companies, One Person Company 15 days from the date of the AGM. Form AOC-4 and Form AOC-4 CFS (in case of Consolidated financial statements) Filing of Annual Accounts Board Report along with annexures: MGT-9, AOC-2, CSR Report, Corporate Governance Report, Secretarial Audit Report, etc.. as per the nature of Company and financial statements 60 days from the date of the AGM. Companies prescribed as per The Companies (Cost Records and Audit Rules), 2014 amended from time to time. Form AOC-4 (XBRL) Filing of Annual Accounts in XBRL mode XML document of financials of the Company 30 days from the date of the AGM Listed companies in India and their Indian subsidiaries (or) a public company With paid-up capital >= 5 crores (or) With turnover>=100 crores Form MGT-7/MGT-7A Filing of Annual Return List of shareholders, debenture holders, Share Transfer, MGT-8 30 days from the receipt of the Cost Audit Report Private Companies, Public Limited Companies, Listed Companies, One Person Company Form CRA-4 Filing of Cost Audit Report XML document of Cost Audit report 30 days from the date of the concerned Board Meeting Private Company, Public Limited Companies, Listed Companies, One Person Company Form MGT-14 Filing of resolutions with MCA regarding approval of Board Report and Annual Accounts A certified true copy of the resolution. 30 days from the date of concerned Board Meeting Public Companies and Listed Companies (Exempted for private companies) FAQs What is ROC Filing, and why is it mandatory for my company? ROC filing entails the submission of necessary paperwork and financial declarations to the Registrar of Companies. It is a compulsory obligation for every company that is registered under the Companies Act to adhere to regulatory obligations. By completing ROC filing, businesses ensure adherence to legal requirements, promote transparency, and establish accountability. What are the deadlines for ROC filing? The deadlines for ROC filing differ based on the company’s type and size. Private limited companies have 30 days, public limited companies have 60 days, one-person companies have 60 days, and small companies have 90 days to complete their ROC filing from the Annual General Meeting (AGM).