Page 20 - Banking Finance August 2021

ROUNDUP

Covid-dedicated hospitals and health In the case at the Karnataka High tem. It is their foresight that transited
centres across the country. Court, a steel company had set off its the long Demat account opening pro-
carried forward business loss with capi- cedure into an easy digital experience
Mandaviya said that under the new
package, the Centre would provide Rs tal gains arising from the transfer of a without compromising on the neces-
15,000 crore and states Rs 8,000 crore business asset - a piece of land. The tax sary controls. Our milestones are a
and the plan would be implemented department had objected to this treat- result of the hard-work and coordina-
jointly by them across all the 736 dis- ment. tion of all the market infrastructure
tricts of the country to improve medi- The court ruled that a carried forward institutions and the market intermedi-
cal infrastructure at primary and dis- business loss could be set off against aries," said CDSL Managing Director
trict health centres. profits or gains, if any, of any business Nehal Vora.
Around 240,000 normal medical beds carried on a company. The tax laws use "I would like to thank all the partici-
and 20,000 ICU beds would be created the phrase "profits or gains, if any, of pants of the capital market for their
of which 20 percent would be specially any business" and do not refer to the contribution in accelerating the digital
earmarked for children, he said. head of profits and gains of business or and financial growth of India. This jour-
profession, the court observed.
The minister said storage facilities for ney of financial inclusion has to en-
oxygen and medicines would also be "As per the ruling, the assessee (tax hance to engage with a higher num-
created at district level under the plan. payer) is entitled to set off brought ber of persons to foray into the securi-
forward loss against income which has ties market to achieve the objective to
The plan aims to accelerate health sys-
the attributes of business income even make India a capital market hub that
tem preparedness for immediate re-
though the same is assessable under is highly focused on corporate gover-
sponsiveness for early prevention, de-
the head other than business income," nance, technology, investor protec-
tection and management of Covid with
the focus on infrastructure develop- said Yashesh Ashar, a partner at tax tion, transparency and sustainability,"
ment including for Paediatric Care and advisory firm Bhuta Shah & Co. he added.
with measurable outcomes, he said. Following the court ruling, many com- CDSL is one of the two depositories in
panies may now be able to carry for- India and the only listed one in the
Karnataka HC allows Non- ward profits or loss from non-core op- country. It received certificate of com-
erations, including selling land or capi- mencement of business from SEBI in
business income to be car-
tal market gains, say tax experts. February 1999. It facilitates holding
ried forward "This ruling can go a long way for busi- and transacting in securities in the
The Karnataka High Court ruling has ness in getting a set-off of income electronic form and facilitates settle-
turned the spotlight on the issue of com- which could be treated as business in- ment of trades on stock exchanges.
panies being allowed to carry forward come but not taxed under the head CDSL maintains and services 4 crore
profits or losses from "non-business in- profits and gains of business and pro- Demat accounts of investors or benefi-
come" or from non-core operations. fession," said Ashar. cial owners (BOs) spread across India.

The recent ruling said if a company, These BOs are serviced by CDSL's over
while paying taxes or preparing finan- 4-cr Demat accounts with 580 depository participants (DPs) from
cial statements, had categorised a cer- over 20,600 locations.
tain amount as "other business in- CDSL
come", that amount could be used to Central Depository Services (India) Lim- Major shareholders of CDSL include
carry forward profits or losses. ited (CDSL), the second Indian central BSE, Canara Bank, HDFC Bank, LIC and
securities depository based in Mumbai, Standard Chartered Bank.
According to accounting rules, compa-
nies are allowed to carry forward prof- has become the first depository to CDSL offers a host of services through
open more than four crore active its subsidiaries - CDSL Ventures Limited
its and losses in their financial state-
Demat accounts. (CVL), CDSL Insurance Repository Lim-
ments for up to eight years in most
cases. This accounting treatment af- "I will firstly congratulate SEBI for be- ited (CDSLIR), CDSL Commodity Reposi-
fects the company's profitability and ing the visionary leader that guided us tory Limited, and CDSL IFSC Limited
also the tax outgo. to this digital growth and safe ecosys- (CDSL IL). T

20 | 2021 | AUGUST | BANKING FINANCE