An assessee can reduce his/her tax liability, by legitimate means, in two ways - tax planning and tax avoidance. The tax planning is described as the arrangement of financial activities in a way that the assessee can avail maximum tax benefit by making best possible use of all the legal benefits, i..e deductions, exemptions etc. On the other hand, the tax avoidance is a technique of refraining from tax liability, through just and fair means, but intends to defeat the fundamental motive of the … [Read more...]

The chief advisor to the President of India is the Prime Minister, who heads the Council of Ministers and also decides, who will become members of the council. The Council of Ministers is divided into various categories, i.e., the Cabinet, Minister of State, Deputy Minister and Parliamentary Secretaries, based on their seniority and the political importance. It is quite common, that people interchange the terms Cabinet and Council of Ministers, and use it as if they are one and the same … [Read more...]

The President of the country is the first citizen, as well as the head of the State. On the other hand, the Prime Minister along with the other Council of Minister, heads the Government of the country, at the national level. Most of the people have doubts, regarding the roles, responsibilities, powers and authorities of the Prime Minister and President. But the fact is that the difference between the two executives relies on the country we are talking about, i.e. some countries have one or … [Read more...]

The fundamental difference between a money bill and finance bill is that a money bill can be introduced in only the lower house of parliament, i.e. Lok Sabha only, finance bill can be introduced in either of the two houses. Although money bill is a type of finance bill, most of the people use them interchangeably, but they differ in terms of their content. We often hear the term bill, but there are only a few people who actually know what the term means. A Bill refers to the proposal for a … [Read more...]

A void agreement is void ab-initio, in essence, it is null since it is formed. But on the other hand, a void contract is one that is valid at the time of creation but eventually becomes void, due to certain circumstances, which are beyond the control of parties concerned. In finer terms, it can be said that a void agreement, is always invalid, but if we talk about the void contract, is one that is enforceable in the beginning, but subsequently lacks it due to changes in government policy or … [Read more...]

An ordinary resolution is refers to a resolution, passed by the members of the company by a bare majority. A special resolution, on the other hand, is the resolution, that is affirmed by the members of the company by three-fourth majority. In a company, the items of business to be transacted at a GM (General Meeting), are presented as motions. The 'motion' refers to a proposal put forward, for discussion and adoption at the meeting. If the motion is approved unanimously, by the members … [Read more...]

Nationality and citizenship are one of the most misconstrued terms, in the world. For a layman, the term nationality works as a substitute for citizenship and vice versa. But in reality, the difference between nationality and citizenship is quite evident, that we cannot ignore it. The nationality of a person, reveals his/her place of birth, i.e. from where he/she belongs. It defines the belongingness of a person to a particular nation. On the contrary, citizenship is granted to an individual … [Read more...]

The government formulates taxation policy with an aim of performing a variety of functions and fulfilling the financial needs of the country by using the money received in the form of tax on development projects. Tax is nothing but a mandatory contribution, levied by the government, without reference to any benefit to the taxpayer, in return for the tax paid by him. By nature, taxes are classified as a progressive tax, proportional tax, and regressive tax. Progressive tax refers to the tax which … [Read more...]

While talking about negotiable instruments such as cheques, bills of exchange and promissory note, we came across the terms holder and holder in due course, quite commonly. Holder refers to a person; we mean the payee of the negotiable instrument, who is in possession of it. He/She is someone who is entitled to receive or recover the amount due on the instrument from the parties thereto. On the other hand, the holder in due course i.e. HDC implies a person who obtains the instrument bonafide … [Read more...]

Foreign Exchange Management Act, 1999 (FEMA) emerged as a replacement or say an improvement over the old Foreign Exchange Regulation Act, 1973 (FERA). Foreign investors, frequently hear the terms FERA and FEMA, when they deal with India. As their name specifies, FERA lays emphasis on the regulation of currencies, whereas the FEMA manages foreign exchange, i.e. forex. The first and foremost difference between FERA and FEMA is that the former requires previous approval of Reserve Bank of India … [Read more...]