Journal November 2023

Ahmedabad Chartered Accountant Journal November, 2023 521 Rights and duties of Allotees under RERA The Article 21 of the constiution is considered to provision of paramount importance titled as “Protection of life and personal liberty”. The provision of the same reiterated below: “No person shall be deprived of his life or personal liberty except according to procedure established by law” This one-line article provision certainly has a wider meaning recognized by the judiciary from time to time. It also includes Access to speedy justice and trial. The enactment of RERA is motivated by fast track dispute resolution mechanism. First and foremost let us discuss definition of “Allotee” (d) “allottee” in relation to a real estate project, means the person to whom a plot, apartment or building, as the case may be, has been allotted, sold (whether as freehold or leasehold) or otherwise transferred by the promoter, and includes the person who subsequently acquires the said allotment through sale, transfer or otherwise but does not include a person to whom such plot, apartment or building, as the case may be, is given on rent; Allottes include first as well as second buyer reason being it includes the person who subsequently buys a unit in a real estate project. We hereby discuss sections of RERA act which describes duties and rights of allottes: Section 11(1) expressely states about details of registration, details of number of units and type of apartments, status of project, list of approvals taken. Section 11(4)(d) states about promoter be responsible for providing and maintaining the essential services, on reasonable charges, till the taking over of the maintenance of the project by the association of the allottees Section 11(5) states that the promoter may cancel the allotment only in terms of agreement for sale if not so allottee may approach the Authority for relief, if he is aggrieved by such cancellation and such cancellation is not in accordance with the terms of the agreement for sale, unilateral and without any sufficient cause. Section 19 of the Act describes rights and duties of allotees under RERA: “19. (1) The allottee shall be entitled to obtain the information relating to sanctioned plans, layout plans along with the specifications, approved by the competent authority and such other information as provided in this Act or the rules and regulations made thereunder or the agreement for sale signed with the promoter. (2) The allottee shall be entitled to know stage-wise time schedule of completion of the project, including the provisions for water, sanitation, electricity and other amenities and services as agreed to between the promoter and the allottee in accordance with the terms and conditions of the agreement for sale. (3) The allottee shall be entitled to claim the possession of apartment, plot or building, as the case may be, and the association of allottees shall be entitled to claim the possession of the common areas, as per the declaration given by the promoter under sub-clause (C) of clause (I) of sub-section (2) of section 4. (4) The allottee shall be entitled to claim the refund of amount paid along with interest at such rate CA. Manan Doshi [email protected] GujRERA Corner

522 Ahmedabad Chartered Accountant Journal November, 2023 GujRERA Corner as may be prescribed and compensation in the manner as provided under this Act, from the promoter, if the promoter fails to comply or is unable to give possession of the apartment, plot or building, as the case may be, in accordance with the terms of agreement for sale or due to discontinuance of his business as a developer on account of suspension or revocation of his registration under the provisions of this Act or the rules or regulations made thereunder. (5) The allottee shall be entitled to have the necessary documents and plans, including that of common areas, after handing over the physical possession of the apartment or plot or building as the case may be, by the promoter. (6) Every allottee, who has entered into an agreement for sale to take an apartment, plot or building as the case may be, under section 13, shall be responsible to make necessary payments in the manner and within the time as specified in the said agreement for sale and shall pay at the proper time and place, the share of the registration charges, municipal taxes, water and electricity charges, maintenance charges, ground rent, and other charges, if any. (7) The allottee shall be liable to pay interest, at such rate as may be prescribed, for any delay in payment towards any amount or charges to be paid under sub-section (6). (8) The obligations of the allottee under sub-section (6) and the liability towards interest under subsection (7) may be reduced when mutually agreed to between the promoter and such allottee. (9) Every allottee of the apartment, plot or building as the case may be, shall participate towards the formation of an association or society or cooperative society of the allottees, or a federation of the same. (10) Every allottee shall take physical possession of the apartment, plot or building as the case may be, within a period of two months of the occupancy certificate issued for the said apartment, plot or building, as the case may be. (11) Every allottee shall participate towards registration of the conveyance deed of the apartment, plot or building, as the case may be, as provided under sub-section (1) of section 17 of this Act. Interest under RERA: Interest is defined under section 2(za) of the Act, “interest” means the rates of interest payable by the promoter or the allottee, as the case may be. Explanation.—For the purpose of this clause— (i) the rate of interest chargeable from the allottee by the promoter, in case of default, shall be equal to the rate of interest which the promoter shall be liable to pay the allottee, in case of default; (ii) the interest payable by the promoter to the allottee shall be from the date the promoter received the amount or any part thereof till the date the amount or part thereof and interest thereon is refunded, and the interest payable by the allottee to the promoter shall be from the date the allottee defaults in payment to the promoter till the date it is paid; Rule 16 of Gujarat Real Estate (Regulation and Development) (General) Rules, 2017 states that the rate of interest shall be the contractual rate of interest as may be mutually agreed to between the promoter and the allottee. Sub rule 2 of Rule 16 states that In case where the contractual agreement/AFS does not expressly provide interest rate, SBI MCLR +2% shall be considered. Sub rule 3 of rule 16 states that the interest payable by the promoter to the allottee shall be from the date the promoter received the amount or any part thereof till the date the amount or part thereof and interest thereon is refunded, and the interest payable by the allottee to the promoter shall be from the date the allottee defaults in payment to the promoter till the date it is paid. Rule 17 states that Any refund of monies along with the applicable interest and compensation, if any, payable by the promoter in terms of the Act or the rules and regulations made thereunder, shall be payable by the promoter to the allottee within forty-five days from the

Ahmedabad Chartered Accountant Journal November, 2023 523 date on which such refund along with applicable interest and compensation, if any, becomes due. Section 18 of the act states that if the promoter fails to complete or is unable to give possession of an apartment, plot or building, the promoter shall be e liable on demand to the allottees, in case the allottee wishes to withdraw from the project, without prejudice to any other remedy available, to return the amount received by him in respect of that apartment, plot, building, as the case may be, with interest at such rate as may be prescribed in this behalf including compensation in the manner as provided i.e. SBI MCLR + 2% (if not specifically mentioned) Section 11 (4) states that The allottee shall be entitled to claim the refund of amount paid along with interest at such rate as may be prescribed and compensation in the manner as provided under this Act, from the promoter, if the promoter fails to comply or is unable to give possession of the apartment, plot or building, as the case may be, in accordance with the terms of agreement for sale or due to discontinuance of his business as a developer on account of suspension or revocation of his registration under the provisions of this Act or the rules or regulations made thereunder. Section 11(7) states that allottee shall pay interest at an agreed rate if at all allottee makes any delay in making payment however as per section 11(8) the obligation of allottee to pay interest towards section 11(7) may be reduced when mutually agreed between the promoter and such allottee. Proviso to section 12 of the act states,”Provided that if the person affected by such incorrect, false statement contained in the notice, advertisement or prospectus, or the model apartment, plot or building, as the case may be, intends to withdraw from the proposed project, he shall be returned his entire investment along with interest at such rate as may be GujRERA Corner prescribed and the compensation in the manner provided under this Act.” The real estate sector plays a catalytic role in fulfilling the need and demand for housing and infrastructure in the country. While this sector has grown significantly in recent years, it has been largely unregulated, with absence of professionalism and standardization and lack of adequate consumer protection. Though the Consumer Protection Act, 1986 is available as a forum to the buyers in the real estate market, the recourse is only curative and is not adequate to address all the concerns of buyers and promoters in that sector. The lack of standardization has been a constraint to the healthy and orderly growth of industry. Therefore, the need for regulating the sector has been emphasised in various forums. The RERA Act ensure greater accountability towards consumers, and significantly reduce frauds and delays as also the current high transaction costs. It attempts to balance the interests of consumers and promoters by imposing certain responsibilities on both. It seeks to establish symmetry of information between the promoter and purchaser, transparency of contractual conditions, set minimum standards of accountability and a fast-track dispute resolution mechanism. The Act has inducted professionalism and standardization in the sector, thus paving the way for accelerated growth and investments in the long run. ❉ ❉ ❉

524 Ahmedabad Chartered Accountant Journal November, 2023 Summary: India, world’s fifth largest economy, is likely to overtake Japan to become the world’s third-largest economy by 2030 as per report by S&P Global Market Intelligence. Global economy impacted by RussoUkraine war is looking at fresh challenge of IsraelHamas war started in October 2023. This crisis can also have implications for Indian economy. The markets corrected in October due to fears of global inflation, economic downturn and geopolitical tensions. Key M&A and PE Deals includes Blackstone acquiring Care Hospital and KIMS Hospital for reported commitment of $1 Billion and Unicorn,Zetwerk raising $120 million in Series F funding roundled by Avenir Growth Capital. Economic Update: - India, the world’s fifth largest economy in the world, is likely to overtake Japan to become the world’s third-largest economy with a GDP of $7.3 trillion by 2030 as per projections by S&P Global Market Intelligence. - The acceleration of foreign direct investment inflows into India over the past decade reflects the favorable long-term growth outlook for the Indian economy, helped by a youthful demographic profile and rapidly rising urban household incomes. - India’s nominal GDP measured in USD terms is forecasted to rise from $3.5 trillion in 2022 to $7.3 trillion by 2030. This rapid pace of economic expansion would result in the size of the Indian GDP exceeding Japanese GDP by 2030, making India the second largest economy in the Asia-Pacific region. - By 2022, the size of the Indian GDP had already become larger than the GDP of the U.K. and also France. By 2030, India’s GDP is also forecast to surpass Germany. CA. Karan Vora [email protected] - The U.S. at present is the world’s largest economy with a GDP of $25.5 trillion. It makes up for a quarter of the world’s GDP. China is the second largest economy with a GDP size of about $18 trillion, which is almost 17.9% of the world GDP. Japan is a distant third with $4.2 trillion GDP, followed by Germany with $4 trillion GDP. - In October, the RBI kept its repo rate unchanged at 6.50% and maintained its fiscal 2024 inflationforecast at 5.40%. Israel-Hamas war 2023: - On 7th October, an armed conflict broke out between Israel and Hamas-led Palestinian militants from the Gaza Strip after the latter launched a rockets barrage against Israel cities followed by an attack by militants. After clearing Hamas militants, the Israeli military has retaliated by enforcing a total blockade of gaza strip,

Ahmedabad Chartered Accountant Journal November, 2023 525 Capital Markets conducting an extensive aerial bombardment campaign on Gazan targets, and hasfollowed up bya large-scale ground invasion of Gaza. - In current war, very large number of Israelis, mostly civilians and Palestinians, mostly women and children, have been killed already, as both Israel and Hamas have been accused of war crimes. - U.N. by a resolution on 27th October has called for an “immediate and sustained” humanitarian truce and cessation of hostilities, condemned “all acts of violence aimed at Palestinian and Israeli civilians” and “demands that all parties immediately and fully comply with their obligations under international law” - For a global economy reeling under the impact of the Russian invasion of Ukraine that began in February 2022, the Israel-Hamas war has come as a fresh challenge. The earlier war, Involving a major energy producer (Russia) and a major agricultural producer (Ukraine), has led to high energy prices, a global food shortage and global inflation. - While, neither Israel nor Gaza is a significant oil producer, the war could have repercussions across West Asia, which is home to major oil producers like Iran and Saudi Arabia.Any disruption in movement through the strait will have a direct impact on oil and gas supply and prices. - The International Monetary Fund (IMF) estimates that global growth will slow down from 3.5% in 2022 to 3% in 2023 and to 2.9% in 2024, well below the historical average of 3.8%. - Stock markets around the world initially sank after Israel retaliated to the Hamas attack, as panicking investors pulled out their money, especially from emerging markets. However, the markets later recovered in the hope that the war would be limited to Gaza. Economic Impact on India: - The rupee plunged to an all-time low of 83.28 to the dollar on October 16. It could fall further if oil prices rise.A weakening rupee makes our exports dearer and could lead to further inflation. - A casualty of the war could be the India-Middle EastEurope Economic Corridor (IMEEC), announced during the G20 summit, planning to connect India and Europe through the UAE, Saudi Arabia, Jordan, Israel and Greece—on similar lines to China’s Belt and Road Initiative. - Bilateral trade between India and Israel has reached over $10 billion and may be hit if the entire region gets drawn into the conflict. The UAE is India’s second largest trading partner, which makes the situation tricky for India in case of a protracted war starts involving West Asia. Secondary Market Update: - Markets corrected on account of growing fears of global inflation and an economic downturn, concerns about the lackluster corporate earnings of Indian companies andrising geopolitical tensions in the Middle East. Nifty 50 lost 2.84% and closed at 19,080 while BSE SENSEX lost 2.97% and closed at 63,875 respectively. - Foreign portfolio investors (FPIs) sold Indian equities worth Rs. 245.48 billion in the month of October, highest in last nine months. - FIIs continued to withdraw funds as the US Fed Chair emphasized the imperative for continued monetary tightening policy and keeping interest rates high. Equity Markets Sept- 23 Oct- 23 % Change BSE Sensex 65,828.41 63,874.93 -2.97% Nifty 50 19,638.30 19,079.60 -2.84% BSE 500 27,407.75 26,605.19 -2.93% BSE Healthcare 28,497.52 27,271.79 -4.30% BSE IT 32,065.34 31,060.45 -3.13% BSE FMCG 18,679.41 18,518.38 -0.86% BSE Metal 23,206.33 22,238.64 -4.17%

526 Ahmedabad Chartered Accountant Journal November, 2023 - Information Technology (IT) stocks saw outflows worth 32.62 billion rupees, amid weak results, elevated U.S. Treasury yields and rate concerns in U.S. Primary Market Update: There were 06 main board IPO in October, 2023 of IRM Energy Limited, Plaza Wires Limited, Valiant Laboratories Limited, Updater Services Limited, JSW Infrastructure Limited, and Manoj Vaibhav Gems ‘N’ Jewelers Limited against 11 IPOs in September, 2023. There were 04 SME IPOs in October,2023 as against 03 SME IPOs in September, 2023. Plaza Wires Limited: About the Incorporated in 2006, Plaza Wires is Company engaged in the business of manufacturing and selling wires, and selling and marketing LT aluminum cables and fast-moving electrical goods (FMEG) under its flagship brand ‘Plaza Cables’ and various other home brands. Funds The company plans to use the net Utilization proceeds from the offering to fund the capital expenses for a new manufacturing facility. Additionally, the funds will be allocated to meet the company’s working capital requirements and for general corporate purposes. IPO - Plaza Wires raised Rs 71.28 Performance Crore through the IPO. The public offer consisted of only a fresh issue of 1.3 Crore shares and there was no offer-for-sale component. - Ahead of the IPO, the company raised Rs 20 Crore from two anchor investors. Chanakya Opportunities Fund-I and Astrone Capital UCC-Arven, who bought 18.52 lakh equity shares each in the company at Rs 54 per share. - The company raised a little more than Rs 71 Crore via primary markets by selling its shares in the range of Rs 51-54 a piece. The IPO was successful and oversubscribed by 160 times. Capital Markets

Ahmedabad Chartered Accountant Journal November, 2023 527 Funds Mobilization by Corporates (Rs. In Crore) Particulars Aug-23 Sept- 23 I. Equity Issues 15,697 14,657 a. IPOs (i+ii) 5,124 9,284 i. Main Board 4,646 8,758 ii. SME Platform 478 526 b. FPOs 0 0 c. Equity Rights Issues 1,342 280 d. QIPs/IPPs 7,400 3,102 e. Preferential Allotments 1,831 1,991 II. Debt Issues 49,329 52,394 a. Debt Public Issues 1,948 2,318 b. Private Placement of Debt 47,381 50,076 Total Funds Mobilized (I+II) 65,026 67,051 Mergers and Acquisitions (M&A) and Private Equity (PE) key deals: M&A: Blackstone acquires controlling stake in CARE Hospitals and KIMS Hospitals Transaction: - US-based private equity major Blackstone said on Monday it had completed the acquisition of a 72.5 per cent stake in Quality Care India Ltd (QCIL), which operates a network of Care Hospitals, from Evercare, a platform backed by TPG Rise funds. - In a separate deal, QCIL has signed a definitive agreement to acquire around 80% in KimsHealth, a Thiruvananthapuram-headquartered quaternary care hospital network offering end-to-end healthcare services. - Blackstone’s overall commitment including its investment in QCIL and KIMS is estimated to be around $1 Billion as reported by various media outlets. About Blackstone: - Blackstone is an American alternative investment management company based in New York. It was founded in 1985 as a M&A firm by Peter G. Peterson and Stephen A. Schwarzman, who had previously worked together at Lehman Brothers. - As of June 2023, the company’s total assets under management were approximately US$1 trillion, making it the largest alternative investment firm globally. About Care Hospitals: - Founded in 1997 by a team of India’s leading cardiologists, CARE Hospitals started its journey as a 100-bedded Heart Institute with a core team of 20 cardiologists, 1 operating theatre, and 1 catheterization laboratory. - Today, the CARE Hospitals Group is a multispecialty healthcare provider with 17 healthcare facilities serving 7 cities across 6 states in India. - It is the regional leader in South and Central India and is amongst the top 5 Pan-Indian hospital chains. CARE Hospitals delivers comprehensive care in over 30 specialties. About KIMS: - Founded in 2000, by Dr. Bhaskar Rao Bollineni in the city of Nellore. KIMS is one of the largest corporate healthcare groups in India. - KIMS operates 13 hospitals across the states of Andhra Pradesh, Telangana, and Maharashtra. Rationale: - TPG will continue to hold the remaining stake of 27.5% in QCIL. With QCIL valued at Rs 6,600 Crore ($800 million), the deal is estimated at about Rs 4,800 Crore ($580 million).The valuation of KimsHealth is estimated at Rs 3,300 Crore ($400 million). - The acquisition of Care Hospitals by Blackstone and, in turn, of KimsHealth by Care Hospitals would create one of India’s largest hospital platforms spread over 11 cities, with 23 facilities. Combined entity would be comparable in size to Aster DM and Fortis Healthcare and bested only by Apollo Hospitals and Manipal Hospitals. - Kims Health posted revenues of Rs 968 Crore in FY23, growing at 16% year-on-year, while its EBITDA stood at Rs 187 Crore, up 26%. Profit after tax in FY23 was Rs 142 Crore. - True North will sell its entire stake in KimsHealth as part of the transaction, while Dr. Sahadulla, Chairman and MD of KIMS will continue to hold around 20% and continue to run the business. Capital Markets

528 Ahmedabad Chartered Accountant Journal November, 2023 - The combined platform will deliver care in more than 30 clinical specialties, including cardiac sciences, oncology, neurosciences, renal sciences, orthopedics, gastroenterology, and integrated organ transplant. PE:Zetwerk Manufacturing Businesses Pvt. Ltd, raises $120 million in Series F funding Transaction: - Zetwerk Manufacturing Businesses Pvt. Ltd, a provider of custom manufacturing services, raised $120 million in Series F funding from a consortium including Avenir Growth Capital, Footpath Ventures, Lightspeed India Partners, Greenoaks Capital, Steadview Capital, and D1 Capital Partners. About Zetwerk Manufacturing Businesses Pvt. Ltd: - Zetwerk, founded in 2018 by Amrit Acharya, Srinath Ramakkrushnan, Rahul Sharma and Vishal Chaudhary, is a manufacturing services platform, which connects manufacturing companies with vendors and suppliers for customized products, industrial machine components and other equipment. - The company’s manufacturing capabilities range from simple items like pipes to complex products like aircraft engine parts. It’s range includes CNC machining, Die casting, 3D printing, Apparel production etc. About the Investors: Avenir Growth Capital: - Avenir Growth Capital is a private investment firm based in New York. The firm was founded in 2017. It focuses on growth equity opportunities, particularly in the media and TMT sectors. Fund typically invest in rounds with 6-7 participants. Footpath Ventures: - Footpath Ventures is a New York-based venture capital firm that was founded in 2019. Investing in growth capital in emerging Asia, specifically in India. They focus on B2C, B2B, e-commerce, gaming, and education sector firms. It’s portfolio includes: Udaan, Meesho, and Dream11. Rationale: - Zetwerk has seen meteoric rise in business from its modest beginning in FY18. Zetwerk’s operating revenue jumped almost 6X, reaching INR 4,960 Cr in FY22 from INR 835 Cr in FY21. Revenue for FY23 are around Rs. 11,500 Crore as per media reports. - Last year, Zetwerk acquired four companies at a cumulative cost of around $50 Mn. - The startup announced its foray into IT hardware and electric vehicle (EV) component manufacturing this September. - According to media reports, Zetwerk has set aside INR 1,000 Cr to invest in electronics manufacturing. The startup is already manufacturing consumer electronics, including audio devices, TVs and smart watches, among others. - Avenir Growth Capital invested around $75 Mn while Footpath Ventures pumped in $23.5 Mn. - The company has been valued at around $2.7 billion post allotment of the Series F2 round. Zetwerk was valued at around $2.68 billion when it raised $210 million led by Greenoaks in December 2021. - Zetwerk has raised $674 million in funding to date. - At present, Avenir Growth Capital holds 4.7% while Lightspeed, Peak XV Partners, and one of its cofounders Amrit Acharya own 11.72%, 13.91%, and 7.95% stake respectively. Acknowledgements: RBI Bulletin (www.bulletin.rbi.org.in), SEBI (www.sebi.gov.in), NSE (www.nseindia.com), BSE (www.bseindia.com) ❉ ❉ ❉ Capital Markets

Ahmedabad Chartered Accountant Journal November, 2023 529 IND-AS 2 INVENTORIES ANNUAL REPORT 2022-23 Indian Oil Corporation Limited Raw Materials & Stock-in-Process Raw materials including crude oil are valued at cost determined on weighted average basis or net realisable value, whichever is lower. Stock in Process is valued at raw materials cost plus processing cost as applicable or net realisable value, whichever is lower. Crude oil in Transit is valued at cost or net realisable value, whichever is lower. Initial cost of inventories includes the transfer of gains and losses on qualifying cash flow hedges, recognized in OCI, in respect of the purchases of raw materials. Finished Products and Stock-in-Trade Finished Products and Stock in Trade, other than lubricants, are valued at cost determined on ‘First in First Out’ basis or net realisable value, whichever is lower. Cost of Finished Products internally produced is determined based on raw materials cost and processing cost. Lubricants are valued at cost on weighted average basis or net realisable value, whichever is lower. Cost of lubricants internally produced is determined based on cost of inputs and processing cost. Imported products in transit are valued at cost or net realisable value whichever is lower. Stores and Spares Stores and Spares (including chemicals, packing containers i.e. empty barrels, tins etc.) are valued at weighted average cost. Specific provision is made in respect of identified obsolete stores & spares and chemicals for likely diminution in value. Further, a provision @ 5% of cost is also made on the balance stores and spares (excluding barrels, tins, stores in transit, chemicals/catalysts, crude oil, and own products) towards likely diminution in the value. Stores and Spares in transit are valued at cost. MOIL Limited Inventories are valued on following basis. (A) Finished goods (i) Manganese ore of all grades (except fines, hutch dust and HIMS rejects):- At cost at mines including depreciation on mine assets or net realizable value, whichever is less. (ii) Manganese ore fines, hutch dust and HIMS rejects: - At cost per tonne on jigging/ processing, transportation, etc., allocated on technical estimates or net realizable value, whichever is less. (iii) Manganese ore at port: - At landed cost at the port or net realizable value, whichever is less. Landed cost includes freight, unloading charges, sampling charges, etc. Difference between physical and book stocks are not adjusted, so long as the overall position of stocks at mines is found to be excess when compared with overall book stocks. As and when ore is actually dispatched, excess or shortage after railing/ shipment against each stack is ascertained and the same is accounted for in the books of the company in that year. (iv) Electrolytic manganese di-oxide [EMD] (including stock as on 31st March at different stages of production, ascertained by technical estimation as to percentage of completed units of EMD): -At current year’s cost of production including plant’s depreciation or net realizable value, whichever is less. CA. Pamil H. Shah [email protected] From Published Accounts

530 Ahmedabad Chartered Accountant Journal November, 2023 (v) (a) Ferro manganese/silico manganese including stock in cake form as on 31st March, determined by technical assessment: -At current year’s cost of production including plant’s depreciation (less realizable value of slag) or net realizable price, whichever is less. (b) Stock in process: -The quantity of ferromanganese/silico manganese in process cannot be weighed, seen or assessed and, hence, no value is assigned. (c) Stock of slag: - Slag is a molten mass of impurities generated during manufacture of ferro manganese, which is treated as scrap and, accordingly, valued at net realizable price. (B) Stores inventory (Stores, spares, timber, explosives, fuel and lubricants and raw materials etc.): - At lower of the cost and net realisable value as per Ind AS 2. The basis for determining the cost is weighted average method. (i) Physical verification of all stores, spares, etc., is conducted at the end of each year. Difference between physical stock and book stock is examined and necessary adjustments are carried out in the books of accounts. (ii) In case of ferro manganese plant, stock of raw materials, except manganese ore at plant, is valued at lower of cost determined on weighted average method and net realisable value. The stock of manganese ore at plant is valued at lower of current year’s cost of production and net realizable value, plus cost of transport and other charges, if any as per Ind AS 2. Opening and closing stock of ore at the plant is grouped under the head “Stock of raw materials”. (iii) Provision for obsolete Stores and SparesProvision is made for 70% of the value of From Published Accounts obsolete stores and spares as at the end of every Financial Year. The same is reviewed at year end. (iv) Provision for non-moving Stores and Spares Provision is made for 10% of the value of stores and spares non-moving for more than three years at the end of every Financial Year. The same is reviewed at year end. (C) Physical verification of inventories is carried out at the end of the year. (D) Production and inventory of manganese ore as well as bulk raw materials and ferro manganese are determined as per weight volume ratio by the production/ technical department and the same are accounted for accordingly. The same is reviewed at year end. (C) Physical verification of inventories is carried out at the end of the year. (D) Production and inventory of manganese ore as well as bulk raw materials and ferro manganese are determined as per weight volume ratio by the production/ technical department and the same are accounted for accordingly. TATA Steel Limited Inventories are stated at the lower of cost and net realisable value. Cost is ascertained on a weighted average basis. Cost comprise direct materials and , where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. Net realisable value is the price at which the inventories can be realised in the normal course of business after allowing for the cost of conversion from the existing state to a finished condition and for the cost of marketing, selling and distribution. Provisions are made to cover slow-moving and obsolete items based on historical experience of utilisation on a product category basis, which involves individual businesses considering their product lines and market conditions.

Ahmedabad Chartered Accountant Journal November, 2023 531 TSN Wires Company Limited Inventories are stated at the lower of cost or net realisable value. Cost is determined by the weighted average method. The cost of purchase comprises both the purchase price and costs directly attributable to the acquisition of the inventory, such as import duties and transportation charges, less all attributable discounts, allowances or rebates. The cost of finished goods and work in process comprises raw materials, direct labour, other direct costs and related production overheads (based on normal operating capacity). Net realisable value is the estimate of the selling price in the ordinary course of business, less the costs of completion and selling expenses. The amount of any write down of inventories to net realisable value is recognised as an expense in the period the write down occurs and presented as cost of sales. Hindustan Aeronautics Limited Inventories are valued at lower of Cost and Net Realisable Value. The cost of raw material excluding Goods-in-Transit, components and stores are assigned by using the weighted average cost formula. Goodsin-Transit are valued at cost-to-date. In the case of From Published Accounts Continued from page 509 GST and VAT - Judgements and Updates Finished Goods, Stock-in-Trade and Work-In Progress, cost includes costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. Cost includes Taxes and duties (other than Taxes and duties for which input credit is available). Provision for redundancy is assessed on ageing at a suitable percentage / level of the value of closing inventory of raw material and components, stores and spare parts and construction material. Besides, wherever necessary, adequate provision is made for the redundancy of such materials in respect of completed / specific projects and other surplus / redundant material pending transfer to salvage stores. Saleable / Disposable scrap is valued at Net Realisable Value. Stores declared surplus / unserviceable / redundant are charged to revenue in the year of such identification. Consumables issued from stores and lying unused at the end of the year are not reckoned as inventory. ❉ ❉ ❉ notice can only be met if a show cause notice contains the material/ground which according to the department necessitates an action and the particular penalty/action which is proposed to be taken. In the present case, it was specifically mentioned in the notice that there was no actual supply of goods on 12th June, 2018 by M/s. Raghav Enterprises to petitioner and the petitioner was directed to submit reply to the notice and it was stated that if no reply was furnished then order under section 74(9) of CGST Act, 2017 would be passed. Therefore, the Court dismissed the petition since notice contained necessary details and grounds and there was no ground for quashing same under Article 226 of Constitution of India. (Sources: Corporate Professionals Today) ❉ ❉ ❉

532 Ahmedabad Chartered Accountant Journal November, 2023 CA. Kunal A. Shah [email protected] From the Government CA. Ashwin H. Shah [email protected] 1. It is informed that GSTN has developed a functionality to generate automated intimation in Form GST DRC-01C which enables the taxpayer to explain the difference in Input tax credit available in GSTR-2B statement & ITC claimed in GSTR-3B return online as directed by the GST Council. This feature is now live on the GST portal. 2. This functionality compares the ITC declared in GSTR-3B/3BQ with the ITC available in GSTR-2B/2BQ for each return period. If the claimed ITC in GSTR 3B exceeds the available ITC in GSTR-2B by a predefined limit or the percentage difference exceeds the configurable threshold, taxpayer will receive an intimation in the form of DRC-01C. 3. Upon receiving an intimation, the taxpayer must file a response using Form DRC-01C Part B. The taxpayer has the option to either provide details of the payment made to settle the difference using Form DRC-03, or provide an explanation for the difference, or even choose a combination of both options. 4. In case, no response is filed by the impacted taxpayers in Form DRC-01C Part B, such taxpayers will not be able to file their subsequent period GSTR-1/IFF. (GST Updates dated 14/11/2023) 2) ITC Reversal on Account of Rule 37(A) 1. Vide Rule 37A of CGST Rules, 2017 the taxpayers have to reverse the Input Tax Credit (ITC) availed on such invoice or debit note, the details of which have been furnished by their supplier in their GSTR-1/IFF but the return INCOME TAX 1) Circular relating to Condonation of delay u/s 119(2)(b) of the Income tax Act in filing Form 10- IC for AY 2021-2022 Representations have been received by CBDT stating that Form No 10-IC could not be filed for AY 2021-2022 within the due date or extended due date, as the case may be. It has been requested that the delay in filing of Form No. 10-IC for AY 2021-2022 may be condoned. On consideration of the matter, CBDT hereby directs that:- The delay in filing of Form 10-IC as per Rule 21AE of the Rules for previous year relevant to AY 2021-2022 is condoned in cases where the following conditions are satistfied: i) The return of income relevant assessment year has been filed on or before the due date specified u/s 139(1) of the Act; ii) The assessee company has opted for taxation u/s 115BAA of the Act in item (e) of “ Filing Status” in “Part A-GEN” of the Form of Return of Income ITR-6; and iii) Form No 10-IC is filed electronically on or before 31/01/2024 or 3 months from the end of the month in which this Circular is issued, whichever is later. (Circular No 19/2023 , dated 23rd October,2023) GOODS AND SERVICE TAX 1) Advisory for Online Compliance Pertaining to ITC mismatch -GST DRC-01C Difference in Input Tax Credit (ITC) available in GSTR-2B & ITC claimed in the GSTR-R3B

Ahmedabad Chartered Accountant Journal November, 2023 533 in FORM GSTR-3B for the said period has not been furnished by their supplier till the 30th day of September following the end of financial year in which the Input Tax Credit in respect of such invoice or debit note had been availed. 2. The said amount of ITC is required to be reversed by such taxpayers, while furnishing a return in FORM GSTR-3B on or before the 30th day of November following the end of such financial year, as part of this legal obligation. 3. To facilitate the taxpayers, such amount of ITC required to be reversed on account of Rule 37A of CGST Rules for the financial year 2022- 23 has been computed from system and has been communicated to the concerned From the Government Corrigendum In the journal published for the month of October 2023 (Volume No 47), the following paragraph was inadvertently printed and should therefore be considered as deleted and hence readers should ignore this paragraph. Paragraph C Any carry forward loss or unabsorbed depreciation not allowed, will be deemed to have given full effect and no further deduction for such loss or depreciation shall be allowed for any subsequent year. recipient. The email communication to this effect has been sent on the registered email id of the taxpayer. 4. The taxpayers are advised to take note of it and to ensure that such ITC, if availed by them, is reversed as per rule 37A of CGST Rules before 30th of November, 2023 in Table 4(B)(2) of GSTR-3B while filing the concerned GSTR-3B. (GST Updates dated 14/11/2023) ❉ ❉ ❉

534 Ahmedabad Chartered Accountant Journal November, 2023 CA. Mayur H. Modha Hon. Secretary CA. Prakash B. Nandola Hon. Secretary 1. Glimpses of Past Events. Day & Date Program Speaker Venue Monday, 06th A 3-Day Workshop on Tech-Upgradation CA Rushabh Shah CAAA Office, November,2023 for Chartered Accountants CA Margik Doshi 201, 2nd Floor to CA Tapas Ruparelia Darshak Building Wednesday, 8th November, 2023 Wednesday, 22nd Diwali Get-to-gather - Ratnamani Farm November,2023 and Party Plot, Opp. Star Bazaar, Jodhpur-Satellite, Ahmedabad Thursday, 23rd 5th Meeting of Indirect Study Group 2023-24 CA. Vikas Agrawal CAAA Office, November,2023 on”GST implications on emerging issues” 201, 2nd Floor Darshak Building 2. Forthcoming Event Day & Date Program Speaker Venue Saturday 9th Cricket Match President XI v/s HL College December,2023 Secretary XI on 9-12-2023 Cricket Ground, 8.30 am onwards — Ahmedabad Monday 8th 54th Residential Refresher Course To be Announced Hotel Hyatt Regency January 2024, to Nepal-The Land of Himalayas. Kathmandu, Nepal Friday 12th Hotel Hyatt Regency Kathmandu, Nepal January, 2024 Association News

536 Ahmedabad Chartered Accountant Journal November, 2023 Across 1. As per Section 75 of CGST Act, 2017, the Assessing Authority is bound to afford opportunity of _________ hearing to the assessee before passing adverse assessment order. 2. As per article 21 of the Constitution, No person shall be deprived of his life or personal _______ except according to procedure established by law. ACAJ Crossword Contest - 30 ❉ ❉ ❉ Notes: 1. The Crossword puzzle is based on this issue of ACA Journal. 2. Two lucky winners on the basis of a draw will be awarded prizes. 3. The contest is open only for the members of Chartered Accountants Association and no member is allowed to submit more than one entry. 4. Members may submit their reply either physically at the office of the Association or by email at [email protected] on or before 31-12-2023. 5. The decision of Journal Committee shall be final and binding. Prize Courtesy Winners of ACAJ Crossword Contest – 29 1. CA. Dharmendra Bharwad 2. CA. Chandrakant Pamnani ACAJ Crossword Contest 29 - Solution Across: Down: 1. Supplier 4. Create 2. November 5. Brazil 3. Shareholders 6. Charitabletrust 3. The Reserve Bank of India (RBI) recently granted permission to banks from 22 countries to establish Special ________ Rupee Accounts (SVRAs). Down 4. __________is not final, failure is not fatal; it is the courage to continue that counts. 5. 15th December is CA Association __________ Day. 6. By 2030, India’s GDP is also forecast to surpass ___________. 4. 6. 5. 1. 2. 3.