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V. S. VADIVEL FCA

Eminent Chartered Accountant, notable author, socio-economic thinker and unique academician from India.

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Articles : By CA V. S. Vadivel

 

This section brings out certain well thought out articles written by Mr. V. S. Vadivel, FCA, ACS, Chartered Accountant for the ready reference of our esteemed readers.

Audit materiality and risks-an overview - V.S.Vadivel, FCA, ACS, Chartered Accountant

In the auditing parlance, financial information is supposed to be material if its omission or misstatement could influence the economic decision of the users taken on the basis of the financial statements.  Materiality normally depends on the size and nature of the item, which is mainly judged in the particular circumstances of its omission or misstatement.  According to the concept of materiality, some matters individually or in the aggregate, are important for the fair presentation of the financial statements taken as a whole.  The concept of materiality is fundamental to the process of recognition, aggregation, classification and presentation of financial information.  However, materiality depends on the size of the item or error judged in the particular circumstances of its omission or misstatement.  It provides a threshold or cut-off point rather than being a primary qualitative characteristic which information must have, if it is to be useful.  This article by Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant narrates some important aspects related to the concept of audit materiality and the risks connected therewith.  It also slightly deals with the auditor’s duties involved therein. (Published in the Chartered Accountant Journal-Volume 52, No.7, January 2004)

Political parties: the exempted species-By Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant

At last political funding in India is completely opened up.  The lawmakers have once again used their legislative powers very effectively for their own comforts and luxury.  The Central Government has recently taken an attractive step to encourage India Inc. and others to increase their contributions to political parties in the country.  The Election and Other Related Laws (Amendment) Act, 2003, which has received the assent of the President on the 11th September, 2003 has made further amendments to the Representation of the People Act, 1951, the Companies Act, 1956, and the Income-tax Act, 1961.  All these amendments have made funding of political parties easier.  What’s more!  Companies as well as non-corporates in India are now permitted to avail of an attractive tax benefit for contributions made to political parties.  This write-up by Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant aptly discusses about all these ‘politically correct’ changes and deals with the scope and impact of the political contributions in the wake of the recent amendments. To read more the readers may please refer (2004) 189 CTR (Articles) 103

Can NRIs buy and sell immovable property in India under FEMA? - An overview: V.S.Vadivel, FCA, ACS, Chartered Accountant

Under the predecessor law of FEMA or the so-called FERA, the control of buying and selling of property was mainly based on the citizenship of the individual.  However, under FEMA the restriction involving the acquisition and transfer of immovable property in India are no more linked to citizenship of the person but is now generally governed by the Residential status of a person.  This remarkable departure in the policy is explained in this article written by Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant [Published in the Chartered Accountant Journal-Volume 52, No.4, October 2003]

Child’s income, no child’s play-By Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant

Under income-tax law in India, the income arising to a minor child is clubbed with the income of the parent having higher income.  However, this is not a hard and fast rule and there are certain exceptions to this general rule and there are still possible scope for better tax planning for these younger generation breed, who are yet to attain majority.  This write-up by Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant aptly deals with all such tax provisions mainly applicable for minor children in India. To read more on this topic, you may please refer [(2004) 186 CTR (Articles) 37]

Dishonour of cheques–recent amendments–a brief overview-V.S.Vadivel, FCA, ACS, Chartered Accountant

The law relating to dishonour of cheques in India as contained in the Negotiable Instruments Act, 1881 has been made more stringent by the recent amendments incorporated in the Negotiable Instruments (Amendment) Act, 2002.  The amendments primarily seek to speed up the criminal trial for dishonour of cheques and the enhancement of the term of sentence in case of conviction.  This article written by Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant narrates in brief the relevant amendments. [Published in Consolidated Commercial Digest- Volume 5, Part 7]

Sickness and income tax sops-at a glance - by Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant

Sickness and mishaps may happen in human life at any point of time.  Nobody is totally immune from sickness or ill health or death.  In fact, costs for medical care have outpaced the rate of inflation all over the world including India.  However, one way the taxpayer can take advantage of the costly health care, is to deduct allowable medical expenses.  Yes, the Income-tax Act, 1961 has recognised the need to provide for some exemptions and deductions in respect of medical expenses and related costs.  This article by Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant looks into the important income-tax exemptions and deductions available on medical expenses, incurred by taxpayers in India. To read more please refer [(2004) 186 CTR (Articles) 205]

Charity and income tax – Some taxing issues – By Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant

It is true that most of the charitable entities in the country are rendering selfless services to the community.  However, like any other taxpayer, they are also subjected to certain obligations within the framework of the Income-tax Act, 1961.  If the charitable NGOs do not comply with the formalities of income-tax law then they may be subjected to income-tax penalties and prosecution. In this context, the learned author Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant deals with all important points, which should be taken care of by NGOs (especially with regard to their compliance needs) within the framework of the income-tax law in India. More can be read at [(2004) 187 CTR (Articles) 187]

Trademarks law in India – an overview -V.S.Vadivel, FCA, ACS, Chartered Accountant

Man has been the only creature on the earth that has effectively and apparently utilised his talent or intellectual abilities to improve his standard of living.  The things that originate from human brain, by exercise of his special abilities, are called intellectual properties, which play an important role in an increasingly broad spectrum of areas, ranging from fine arts to the awesome space research.  This article written by Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant deals with trademarks, an important intellectual property right (IPR).  It throws light on all basic facts and law, relating to trade marks in India, besides registration and management of trade marks. [Published in Consolidated Commercial Digest- Volume 6, Part 7]

Income of Indian farmers: Some taxing issues-By Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant

Under the Income-tax Act, 1961, agricultural income in India is not subject to tax as it is exempt from tax under section 10(1).  However, it has to be included in the total income of an assessee for rate purposes.  This inclusion of agricultural income for rate purpose, will, in many cases, have the effect of increasing the net tax payable by the assessees.  The learned author Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant deals with how, and in what circumstances, such integration between agricultural and non-agricultural income is necessary under the income-tax law.  He has also dealt with the rationale behind granting/non-granting exemptions for incomes earned by the farmers in India. [Published in Current Tax Reporter (2004) 187 CTR (Articles) 21]

Filing complaints under the Consumer Protection Act-the procedural aspects- V.S.Vadivel, FCA, ACS, Chartered Accountant

One of the important Directive Principles enshrined in the Constitution of India is that the State shall direct the policy towards securing that the operation of the economic system in the country does not result in the concentration of wealth and means of production to the common detriment.  Towards this end, various economic and welfare legislations have been passed by the Government of India.  One of them is the MRTP Act, 1969, which was enacted for the prohibition of monopolistic and restrictive and unfair trade practices.  The Consumer Protection Act (COPRA) was enacted in 1986, with the object of better protection of the consumers in the country and for the settlement of consumer disputes.  While the MRTP Act is directed at prohibition and control of certain unwanted trade practices, the COPRA is mainly directed towards protecting the interests of individual consumers by prescribing certain remedies to make good the loss or damage caused to consumers as a result of unfair trade practices.  The present article by Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant tries to narrate the procedural aspects of filing complaints before the so-called “consumer courts” in the country. [Published in Consolidated Commercial Digest- Volume 7, Part 6]

Cash gifts – taxability- V.S.Vadivel, FCA, ACS, Chartered Accountant

“It is not the size of the gift that matters, but the size of the heart that gives it”, quoted in The Angels’ Little Instruction Book by Eileen Elias Freeman, 1994.  However, from the taxman’s viewpoint, it is not the size of the heart that matters, but the size of the gift that gives it.  This is mainly because the gifts in India, especially the cash gifts do attract tax in many cases even after the abolition of the Gift Tax Act.  In this scenario, this write-up by Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant on cash gifts searches through the jungle of taxation of gifts of money very carefully to offer better tax planning tips.[Published in Consolidated Commercial Digest- Volume 24, Part 1]

Seniors, sway your world! - V.S.Vadivel, FCA, ACS, Chartered Accountant

“Being over seventy is like being engaged in a war. All our friends are going or gone and we survive amongst the dead and dying on a battlefield”. The abovequoted words of Muriel Spark, in Memento Mori may be true.  However, it is equally true that more than seventy percent of the democracies of the world today are being ruled by people, who are more than sixty years old.   Today, many favourable treatments based on old age are encouraged in all walks of life all over the world.  Under the Income-tax Act, 1961, there are certain special provisions of concessional tax treatments for the income earned by people who are elder by age.  If an old assessee or the so-called senior citizen has earned income from investment out of money belonging to him, he is liable to be taxed for that income just like any other taxpayer.  Likewise, the salary earned by him in any profession or any business profits is also treated as his income in the normal course.  However, he is eligible to a ‘special tax rebate’ by virtue of being an ‘oldie’.  In other words, the old assessees in India are eligible to certain exclusive exemptions, deductions and rebates under the income-tax law, which is ‘oldies-friendly’ in one or other way. This write-up by Mr. V.S.Vadivel, FCA, ACS, Chartered Accountant aptly deals with all tax-tips on how to face taxmen by these elder people of advanced age. [Published in Current Taxcom News- Volume 14, Part II, Issue No.6]

Spouse income-no spicy game - V.S.Vadivel, FCA, ACS, Chartered Accountant

The income-tax law in India requires an individual to club certain incomes arising to the spouse along with his or her own total income.  Salary, commission, fees or any other form of remuneration, whether in cash or in kind, from a concern in which such individual has a substantial interest is to be clubbed.  Similarly, income arising from an asset transferred to the spouse for inadequate consideration excluding in an agreement to live apart is also to be clubbed.  However, clubbing of income of the spouse in respect of salary, commission, fees or any other form of remuneration from a concern as mentioned above will not be applicable if the spouse possesses technical or professional qualifications and the income received is solely attributable to the application of such qualification, knowledge and expertise.  This article written by V.S.Vadivel, FCA, ACS, Chartered Accountant on clubbing spouse income not only deals with the legal requirements in this regard but also speaks about the possible remedies to overcome such provisions. [Published in Current Taxcom News- Volume 14, Part III, Issue No.7]

Knowledge is power

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