MCA Notifies Companies Indian Accounting Standards Amendment Rules 2023

The Ministry of Corporate Affairs(MCA) has notified Companies Indian Accounting Standards Amendment Rules 2023 via issuing Notification.

The Notification Stated, “In exercise of the powers conferred by section 133 read with section 469 of the Companies Act, 2013 (18 of 2013), the Central Government, in consultation with the National Financial Reporting Authority, hereby makes the following rules further to amend the Companies (Indian Accounting Standards) Rules, 2015.”

These rules may be called the Companies (Indian Accounting Standards) Amendment Rules, 2023. They shall come into force with effect from 1st day of April, 2023.

In the Companies (Indian Accounting Standards) Rules, 2015, in the “Annexure”, under the heading “B. Indian Accounting Standards (Ind AS)”,-

(A) in Indian Accounting Standard (Ind AS) 101, –

(i) after paragraph 39AG, the following shall be inserted, namely:-

“39AH Deferred Tax related to Assets and Liabilities arising from a Single Transaction, amended paragraph B1 and added paragraph B14. An entity shall apply these amendments for annual reporting periods beginning on or after 1 April 2023.”;

(ii) in Appendix B,

(a) in paragraph B1, for items (f) and (g), the following shall be substituted, namely:-

“(f) embedded derivatives (paragraph B9);

(g) government loans (paragraphs B10–B12);

(h) [Refer Appendix 1]; and

(i) deferred tax related to leases and decommissioning, restoration and similar liabilities (paragraph B14).”;

(b) after paragraph B12, the following paragraphs shall be inserted, namely:-

Deferred tax related to leases and decommissioning, restoration and similar liabilities

B14 Paragraphs 15 and 24 of Ind AS 12, Income Taxes exempt an entity from recognising a deferred tax asset or liability in particular circumstances. Despite this exemption, at the date of transition to Ind AS’s, a first-time adopter shall recognise a deferred tax asset—to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilised—and a deferred tax liability for all deductible and taxable temporary differences associated with:

(a) right-of-use assets and lease liabilities; and

(b) decommissioning, restoration and similar liabilities and the corresponding amounts recognised as part of the cost of the related asset.”;

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