TaxTMI 
TaxTMI 
Memorandums
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....res to plug revenue leakages, rationalisation and simplification mea- sures and measures to stimulate financial markets. (iii) Amendment of the Wealth-tax Act, 1957. 2. Subject to certain exceptions, which have been indicated while dealing with the relevant provisions, the Bill follows the principle that changes in the provisions of the tax laws, should ordinarily be made operative prospectively in relation to the current incomes and not in relation to the incomes of past years. The substance of the main provisions in the Bill relating to direct taxes is explained in the following paragraphs :- INCOME-TAX I. Rates of income-tax in respect of incomes liable to tax for the assessment year 2004-2005. In respect of incomes of all categories of tax payers (corporate as well as non-corporate) liable to tax for the assessment year 2004-2005, the rates of income-tax have been specified in Part I of the First Schedule to the Bill and are the same as those laid down in Part III of the First Schedule to the Finance Act, 2003, for the purposes of computation of "advance tax", deduction of tax at source from "Salaries" and charging of tax payable in certain cases during the finan....
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....04-2005. The rates for deduction of income-tax at source from "Salaries" during the financial year 2004-2005 and also for computation of "advance tax" payable during that year in the case of all categories of taxpayers have been specified in Part III of the First Schedule to the Bill. These rates are also applicable for charging income-tax during the financial year 2004-2005 on current incomes in cases where accelerated assessments have to be made, e.g., provisional assessment of shipping profits arising in India to non-residents, assessment of persons leaving India for good during that financial year, assessment of persons who are likely to transfer property to avoid tax, or assessment of bodies formed for short duration, etc. An additional surcharge, to be called the Education Cess to finance the Government's commitment to universalise quality basic education, is proposed to be levied at the rate of two per cent on the amount of tax deducted inclusive of surcharge. The salient features of the rates specified in the said Part III are indicated in the following paragraphs :- A. Individuals, Hindu undivided families etc. Paragraph A of Part III of the First Schedule s....
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....eding Rs. 1,00,000/- will be required to pay in addtion to income tax payable after rebate under Chapter VIII-A, the Education Cess at the rate of two per cent. 4 Persons having income exceeding Rs.8,50,000/- in this slab would be required to pay ten per cent. surcharge on the total income-tax payable after rebate under Chapter VIII-A, and Education Cess at the rate of two per cent. The impact of levy of surcharge in the case of individuals, HUFs, etc., at different income levels would be as under :- Total income Existing Tax liability (Rs.) New Tax liability (Rs.) Additional tax liability (Rs.) Aditional tax liability (%) Tax liability Cess Total 50,000 Nil Nil Nil Nil Nil Nil 55,000 500 Nil Nil Nil (-) 500 (-) 100 60,000 1,000 Nil Nil Nil (-) 1,000 (-) 100 60,010 1,002 Nil Nil Nil (-) 1,002 (-) 100 60,020 1,004 Nil Nil Nil (-) 1,004 (-) 100 60,050 1,010 Nil Nil Nil (-) 1,010 (-) 100 60,100 1,020 Nil Nil Nil (-) 1,020 (-) 100 60,200 1,040 Nil Nil Nil (-) 1,040 (-) 100 75,000 4,000 Nil Nil Nil (-) 4,000 (-) 100 1,00,000 9,000 Nil Nil Nil (-) 9,000 (-) 100 1,50,000 19,000 19,000 380 19,380 380 2 2,00,000 34,000 34,000 680 34,680 680 ....
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....nhanced by a surcharge for the purposes of the Union at the rate of two and one-half per cent. of the tax payable and the cess at the rate of two per cent. on the tax payable inclusive of surcharge. E. Companies In the case of companies, the rate of income-tax has been specified in Paragraph E of Part III of the First Schedule to the Bill. There is no change in the existing rates of thirty-five per cent. for domestic companies and forty per cent. for foreign companies. The tax payable by all companies would be enhanced by a surcharge at the rate of two and one-half per cent. of the tax payable and the cess at the rate of two per cent. on the tax payable inclusive of surcharge. [Clause 2 & First Schedule] WELFARE MEASURES Exemption of capital gains on compensation received on compulsory acquisition of agricultural land situated within specified urban limits The existing provisions of section 45 provide for charging to tax the capital gains arising from transfer of agricultural land situated within specified urban limits. The said section also provides that where transfer of such land is by way of compulsory acquisition under any law or where the consideration for tran....
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.... amount borrowed by the assessee for the purchase or construction of a residential house property, from his employer being an authority, board, corporation or any other body, established under a Central or State Act. The proposed amendment will take effect from 1st April, 2005 and will, accordingly, apply in relation to assessment year 2005-2006 and subsequent years [Clause 20] Exemption of the family pension received by the family members of armed forces (including para-military forces) personnel killed in action in certain circumstances Under the existing provisions contained in clause (18) of section 10, the pension income received by the recipients of Param Vir Chakra, Mahavir Chakra, Vir Chakra or certain other notified gallantry awards, as well as the family pension received by specified family members of such individuals is not included in computing the total income of such individuals. In the interest of the welfare of the personnel of the armed forces, it is proposed to insert a new clause (19) in the said section so as to provide that where the death of a member of the armed forces (including para-military forces) of the Union has occurred in the website: h....
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....ability', as defined under the Persons with Disability (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995. A deduction of seventy-five thousand rupees is allowed where such individual is a 'person with severe disability' suffering from eighty per cent. or more of one or more disabilities. An individual claiming deduction under this section is required to furnish a copy of the certificate issued by the medical authority along with the return of income. The Explanation to the said section defines the expressions, "disability", "medical authority", "person with disability" and "person with severe disability", with reference to the relevant provisions of the Persons with Disabilities (Equal Opportunities, Protection of Rights and Full Participation) Act, 1995. With a view to extend the benefits under section 80U to persons suffering from autism, cerebral palsy and multiple disability, it is proposed to substitute the said Explanation so as to expand these definitions to include the above mentioned expressions as provided for in the National Trust for Welfare of Persons with Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities Act, 1999. ....
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....2006 and subsequent years. [Clause 15] New provision for allowing deduction from tax payable for individuals having total income upto rupees one hundred thousand. To provide relief to assessees belonging to the lower income group, it is proposed to insert a new section 88D, providing for a rebate of the entire amount of income-tax payable by an individual, resident in India, having total income not exceeding rupees one hundred thousand. website: http://indiabudget.nic.in 5 The proposed amendment will take effect from 1st April, 2005 and will, accordingly, apply in relation to the assessment year 2005-2006 and subsequent years. [Clause 21] Provisions to give effect to the New Pension Scheme A New Pension Scheme is applicable, to new entrants to Government service. As per the scheme, it is mandatory for persons entering the service of the Central Government on or after 1st January, 2004, to contribute ten per cent. of salary every month towards their pension account. A matching contribution is required to be made by the Government to the said account. To give effect to the new pension scheme of the Central Government, it is proposed to insert a new section 80C....
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....ection 206C, collection of tax is required to be made by the seller of certain specified goods from any amount payable by the buyer to the seller at the specified percentage. It is proposed to amend the provisions of section 206C to provide for collection of tax by every person who grants a lease or a licence or enters into a contract or otherwise transfers any right or interest in any parking lot or toll plaza or a mine or a quarry to another person, other than a public sector company, for the use of such parking lot or toll plaza or mine or quarry for the purposes of business. It is proposed that tax shall be collected as provided, from the licensee or lessee of any such licence, contract or lease of the specified nature, by every person at the rate of two per cent. at the time of debiting of the amount payable by the licencee or lessee to his account or at the time of receipt of such amount from him in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier. [ Clauses 30 & 47 ] This amendment will take effect from 1st October, 2004. Obligation to furnish Annual Information Return Under the existing provision of section 285BA, any as....
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....tion (4) of the proposed section provides that where the prescribed income-tax authority considers that the annual information return is defective he may intimate such defect to the person who has furnished such return and give him an opportunity to rectify the same within one month or such further period as allowed and if the defect is not rectified, such return shall be treated as an invalid return and the provisions of the Act shall apply as if such person had failed to furnish the annual information return. Sub-section (5) of the proposed section provides that where a person referred to in sub-section (1) has not furnished the annual information return within the prescribed time, the prescribed income-tax authority may serve upon him a notice requiring him to furnish such return within a period of sixty days from the date of service of such notice and such person shall furnish such return within the time specified in the notice. This amendment will take effect from 1st April, 2005, and will apply to the financial transactions entered into on or after 1st April, 2004. To provide a penalty for not furnishing a return as required by sub-section (1) of the proposed new sec....
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....s of processing, preservation and packaging of fruits and vegetables. The deduction is available from the assessment year relevant to the previous year in which the undertaking begins such business. This amendment amendment will take effect from 1st April, 2005 and will, accordingly, apply in relation to the assessment year 2005-2006 and subsequent years. [Clause 17] Extension of tax benefit u/s 80-IA in the case of renovation and modernisation of transmission and distribution lines in power sector Under the existing provisions contained in sub-section (4) of section 80-IA, an undertaking or enterprise engaged in the generation, generation and distribution, or the transmission or distribution of power which begins such generation or transmission before 1.4.2006, is allowed a hundred percent deduction of the profits for any ten out of fifteen assessment years. However, the deduction is only available to a new undertaking and not to an undertaking formed by way of reconstruction or splitting up of a business already in existence. Further, the deduction is not available in the case of the transfer of old plant and machinery to the new business. In order to rationalise t....
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....rom 1st April, 2005 and will, accordingly, apply in relation to the assessment year 2005-2006 and subsequent years. [ Clause 17] Extension of the time limit for obtaining approval of housing projects for the purpose of tax holiday under section 80-IB, and allowing deduction for redevelopment or reconstruction of existing buildings Under the existing provisions contained in sub-section (10) of section 80-IB, a deduction equal to one hundred per cent of the profits of an undertaking developing and building housing projects is allowed if the housing project is approved by a local authority before 31st March, 2005. The deduction is subject to the conditions that the undertaking should have commenced development of the housing project after the 1st day of October, 1998, the project should be on a size of a plot of land which has a minimum area of one acre, and that the residential unit should have a maximum built-up area of one thousand square feet where such residential unit is situated in Delhi or Mumbai and one thousand and five hundred square feet at other places. It is proposed to substitute the existing sub-section so as to rationalise the provisions and provide additiona....
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....trial Research, Ministry of Science and Technology, Government of India. With a view to give boost to the scientific research and development in the country, it is proposed to allow the deduction to companies carrying on scientific research and development, which are approved by the prescribed authority before 1st April, 2005. The proposed amendment will take effect from 1st April, 2005 and will, accordingly, apply in relation to be assessment year 2005-2006 and subsequent years. [Clause 17] Extension of time limit for providing telecommunication services, etc. for the purpose of tax holiday under section 80-IA Under the existing provision contained in clause (ii) of sub-section (4) of section 80-IA, an undertaking which has started or starts providing telecommunication services, whether basic or cellular, including radio paging, domestic satellite service, network of trunking, broadband network and internet services, before the 31st day of March, 2004, is allowed a deduction for any ten consecutive assessment years beginning from the year in which the undertaking starts providing telecommunication services. The amount of deduction is one hundred per cent of profits for....
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....technical services or any other sum which is payable outside India, or in India to a non-resident or to a foreign company or failure to make payment to the account of the Central Government, attracts disallowance of such payments in the hands of the payer. Deduction of such sum is, however, allowed in the computation of income if tax is deducted, or after deduction, paid in any subsequent year in computing the income of that year. With a view to augment compliance of TDS provisions, it is proposed to extend the provisions of section 40a(i) to payments of interest, commission or brokerage, fees for professional services or fees for technical services to residents, and payments to a resident contractor or sub-contractor for carrying out any work (including supply of labour for carrying out any work), on which tax has not been deducted or after deduction, has not been paid before the expiry of the time prescribed under sub-section (1) of section 200 and in accordance with the other provisions of Chapter XVII-B. It is also proposed to provide that where in respect of payment of any sum, tax has been deducted under Chapter XVII-B or paid in any subsequent year, the sum of payment sha....
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....e spouse of the individual, and (vii) spouse of a person referred to in items (ii) to (vi) mentioned above. It is also proposed to amend section 56 so as to provide that the income referred to in the new sub-clause (xiii) of section 2(24) will be chargeable as "income from other sources". This amendment will take effect from 1stApril, 2005, and will, accordingly, apply in relation to the assessment year 2005-2006 and subsequent assessment years. [Clauses 3, 5 and 12] website: http://indiabudget.nic.in 9 Prosecution for falsification of books of account or documents, etc Under the existing provisions of section 278, punishment to a person who abets or induces any other person to evade tax is linked with the tax evasion by another person and charge of the abetment in case of first person can be sustained only if tax evasion by the other person is established. Deterrence against making false books or documents with an intent to enable other persons to evade tax, penalty or interest can be effectively provided by declaring the making of such books or documents an offence under the Income-tax Act . It is, therefore, proposed to insert a new section 277A to provid....
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....e been issued, will be ignored and the amount of such loss shall be considered as the cost of purchase or aquisition of the bonus units. These amendments will take effect from 1st April, 2005 and will, accordingly, apply in relation to assessment year 2005-2006 and subsequent years. [ Clause 23] RATIONALISATION AND SIMPLIFICATION MEASURES Additional Income-tax on income distributed by the Specified company and Mutual Funds Under the existing provisions of sub-section (2) of section 115R, any amount of income distributed by the specified company or a mutual fund to its unit holders is chargeable to tax and they are liable to pay additional income tax on such distributed income at the rate of twelve and one-half per cent. It is proposed to provide that the specified company or a mutual fund shall continue to pay income tax on such distributed income at the rate of twelve and one-half per cent, if distribution is made to any individual or Hindu undivided family. The rate of tax shall, however, be twenty per cent if income is distributed to any person, other than individual or HUF. This amendment will take effect from 9th July, 2004. [ Clause 27] Exemption for E....
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....prescribed, the National Committee may, at any time, after giving a reasonable opportunity of showing cause, withdraw the approval. It is also proposed to provide that a copy of the order withdrawing the approval or notification shall be forwarded to the Assessing Officer having jurisdiction over the concerned association or institution. This amendment will take effect from 1st October, 2004. [ Clause 10] De-materialisation of TDS and TCS certificates Under the existing provisions of the Income-tax Act, returns of income required to be filed under section 139 are to be accompained by TDS/TCS certificates for claiming credit of tax deducted or collected. Computerisation of TDS/TCS functions will eventually dispense with this requirement and will also pave the way for filing of returns through the internet. The Finance Bill incorporates the necessary legislative amendments required to facilitate the above process of computerisation. The Bill propose to provide that - (i) Credit for tax deducted or collected shall be given to the assessee without production of a certificate; (ii) returns will not be deemed to be defective if they are not accompanied by such certificates....
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....lsory in the case of companies. It is proposed to make the same compulsory in the case of Government deductors also. It is also proposed to make such filing compulsory in the case of TCS as well, where the persons collecting tax are companies or Government. These amendments will take effect from 1st April, 2005. [ Clause 46 & 47] Filing of paper TDS returns Under the existing provisions of sub-section (1) of section 206, the prescribed person in the case of every government office, the principal officer in the case of every company, the prescribed person in the case of every local authority or other public body or association, every private employer and every other person responsible for deducting tax, is required to prepare and deliver or cause to be delivered to the prescribed income-tax authority, such returns in such form and verified in such manner and setting forth such particulars as may be prescribed within the prescribed time, after the end of each financial year. It is proposed to amend sub-section (1) of section 206 to provide that return of tax deduction at source can be filed with any authority or agency specified by rules made by the Central Board of....
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....e records the said Authority may either reject the application or pronounce its advance ruling on the question specified in the application. The existing provisions of section 245RR provide that no income-tax authority or the Appellate Tribunal shall proceed to decide any issue in respect of which an application has been made by a resident to the Authority for Advance Rulings. It is proposed to insert new clauses (vi) and (vii) in Explanation 1 to section 153 so as to provide that the period commencing on the date on which application has been filed to the Authority for Advance Rulings and ending on the date on which the order rejecting the application or pronouncing the advance ruling, as the case may, is received by the Commissioner shall be excluded for computing the period of limitation under this section. It is also proposed to insert new clauses (v) and (vi) in Explanation to section 153B so as to provide that the period commencing on the date on which application has been filed to the Authority for Advance Rulings and ending on the date on which the order rejecting the application or pronouncing the advance ruling, as the case may, is received by the Commissioner shall....
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.... section 278B, where an offence has been committed by a company, the company as well as the person who was in charge of, and was responsible for the conduct of the business of the company at the time when the offence was committed will be deemed to be guilty of the offence. It is also provided that, where the offence had been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of the offence. website: http://indiabudget.nic.in 12 In respect of the some of the offences, it is provided that the person found guilty shall be punishable with rigorous imprisonment and with fine. A company being a juristic person cannot be punished with imprisonment. It can be punished with fine only. It is accordingly proposed to insert a new sub-section (3) in the said section so as to provide that if an offence under the Act has been committed by a person being a company, it shall be punished with fine and any other person who was in charge of and was responsible for the conduct of business of the co....
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.... Valuation Officer, the Assessing Officer may after giving the assessee an opportunity of being heard, take into account such report in making such assessment or re- assessment. As the intention of inserting new section 142A retrospectively is not to unsettle the cases already decided (except in cases where a reassessment is required to be made under section 153A), it is proposed to provide a proviso to the new section to the effect that the provisions of the same shall not apply in respect of an assessment made on or before the 30th day of September, 2004 and where such assessment has become final and conclusive on or before that date. This amendment will take effect retrospectively from 15th November, 1972. [ Clause 31] Power to the Commissioner for cancelling registration under section 12AA Under the existing provisions of section 12AA the procedure for registration of a trust or institution by the Commissioner of Income-tax is provided. Although the power of cancellation of registration flows from the power to register, the same has not been specifically provided in the IT Act thereby leading to unnecessary litigation. It is proposed to provide that if the Com....
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....way of interest on moneys standing to his credit in a Non-Resident (External) Account in any bank in India shall not be included in computing his total income. It is proposed that the exemption will stand withdrawn in respect of such income by way of interest paid to him or credited to his Non-Resident (External) account in any bank in India on or after the 1st day of September, 2004. This amendment will take effect from 1stApril, 2005, and will, accordingly, apply in relation to the assessment year 2005-2006 and subsequent assessment years. [Clause 5] Sunset provision to section 10(15)(iv)(fa) relating to interest on Foreign Currency Deposits Under the existing provisions contained in section 10(15)(iv)(fa), the interest payable by a scheduled bank to a non-resident or to a person who is not ordinarily resident on deposits in foreign currency where the acceptance of such deposits by the bank is approved by the Reserve Bank of India shall not be included in computing his total income. It is proposed that the exemption shall stand withdrawn in respect of such interest payable on or after the 1st day of September, 2004. This amendment will take effect from 1stApr....
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....atures of the proposed tonnage tax scheme are as follows :- . It is a scheme of presumptive taxation whereby the notional income arising from the operation of a ship is determined based on the tonnage of the ship. . The notional income is taxed at the normal corporate rate applicable for the year. · Tax is payable even if there is a loss in an year. . A company may opt for the scheme and once such option is exercised, there is a lock in period of ten years. If a company opts out, it is debarred from re-entry for ten years. . Since this is a preferential regime of taxation, certain conditions like creation of reserves, training etc. are required to be met. · A company may be expelled in certain circumstances. A new Chapter XII-G is proposed to be inserted in the Income tax Act containing sections 115V to 115VZC which provides for special provisions relating to taxation of the income of shipping companies. The Chapter is divided into 7 parts. Part A contains the meaning of certain expressions typically used in shipping business, part B gives the method of computation of tonnage income, part C specifies the procedure for option of tonnage tax scheme, part D ....
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....ection 115VQ lays down that once a company opts for the scheme, the option remains in force for ten years except in certain circumstances. Section 115 VS provides for the circumstances in which the tonnage tax company is prohibited from opting for the scheme. Such prohibition is for a period of ten years. Sections 115VT, 115VU, 115VS and 115VW lay down the conditions for the applicability of the scheme. In terms of section 115VT, a tonnage tax company has to create a reserve of at least 20% of its book profits to be utilized for the purpose of acquisition of new ships. As per section 115VU a tonnage tax company has to comply with a minimum training requirement in accordance with the guidelines to be issued by the DG( Shipping). The company will be expelled if the training requirements are not met for 5 consecutive years. Section 115VV lays down the limit of 49 per cent. for chartering in. In terms of section 115VW, maintenance of separate books of account and the audit of the same is compulsory for a company opting for the scheme. Section 115VX lays down the details regarding valid certificate which indicates the net tonnage of ships. Sections 115 VY and 115VZ provide for the conti....
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....ss on the final products manufactured in India. B. METALS: (I) Customs duty has been reduced from 20% to 15% on the following metals :- (a) Ferro alloys (b) Stainless steel and other alloy steel, excluding seconds and defectives (c) Copper (d) Lead (e) Zinc (f) Tungsten (g) Magnesium (h) Cobalt (i) Cadmium (j) Titanium (k) Other base metals of chapter 81 (II) Customs duty has been reduced from 15% to 10% on all primary, semi-finished and finished forms of iron and steel like ingots and billets, sponge iron, hot rolled and cold rolled bars/rods/coils of non-alloy steel (other than seconds and defectives) of heading 7201 and 7203 to 7217. C. MINERALS Customs duty has been reduced from 20% to 15% on the following minerals :- (a) Graphite (b) Asbestos (c) Mica (d) Fluorspar and Felspar (e) Gypsum (f) Other minerals of Chapter 25 excluding a few items like marble, granite. D. REFRACTORIES AND INPUTS FOR REFRACTORIES Customs duty has been reduced from 20% to 15% on: (a) Refractories (b) Raw materials for refractories e.g. natural graphite powder, aluminous cement, calcined alumina, boron carbide, reactive alumi....
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....s, crutches, wheel chairs, walking frames, tricycles, Braillers, artificial limbs and parts thereof. J. INFORMATION TECHNOLOGY: 1) Customs duty exemption to mobile switching centres presently available to cellular mobile telephone service providers has been extended to imports by universal access service providers. 2) Specified raw materials for manufacture of parts of cathode ray tubes and specified capital goods for manufacture of mobile telephone handsets, cathode ray tubes and parts thereof and plasma display panels have been exempted from customs duty. 3) Customs duty exemption presently available to specified goods for manufacture of telecom grade optical fibres and cables has been extended to some additional specified items. K. EXPORT PROMOTION 1) Customs duty on platinum has been reduced from Rs. 550 per 10 gram to Rs. 200 per 10 gram. 2) All rough coloured gem stones (including rubies, emerald and sapphire) have been fully exempted from customs duty. 3) Concessional rate of customs duty of 5% presently available to specified items for use in leather industry has also been extended to such items designed for use in non-leather footwear industry. Thes....
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....chrome television receivers. 10) Imitation jewellery. 11) Candles. General SSI exemption would be available to all these items. (III) Excise duty on matches made in semi-mechanized and mechanized sectors, has been changed from 8% without Cenvat credit, to 16% with credit. (IV) Excise duty has been raised on iron and steel of chapter 72 from 8% to 12%. (V) Excise duty of 16% has been imposed on following items: 1) Specified parts of pre-fabricated buildings such as blocks, slabs, concrete beams and stairs . 2) Parts of clocks and watches of RSP not exceeding Rs. 500 per piece. General SSI exemption would be available to all these items. C. RELIEF MEASURES 1) The RSP limit for excise duty exemption on footwear has been raised from Rs. 125 to Rs. 250 per pair. The exemption will now be available only if RSP is indelibly marked or embossed on the footwear itself. 2) Excise duty has been reduced from 16% to 8% on gas stoves of RSP not exceeding Rs. 2000 per unit. 3) The value limit for excise duty exemption on pens and refills of ball point pens has been raised from Rs. 100 to Rs.200 per piece. 4) Parts of pens and parts of refills of ball point pe....
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....l Cenvat credit. 7) Textiles and textile articles, presently attracting 'Nil' tariff rate, would continue to do so, except for silk yarn, yarn spun from silk waste, woven fabrics of silk and silk waste (of heading Nos. 50.04 and 50.05). For these items an optional duty of Nil (without Cenvat credit) or 8% (with Cenvat credit) has been prescribed. The tariff rates for these items have been suitably amended. 8) All textiles and textile articles falling under chapter 50 to 63 have been fully exempted from duties under Additional Excise Duty (Goods of Special Importance) Act and Additional Excise Duty (Textiles and Textiles Articles) Act, wherever applicable. 9) Manufacture of polyester filament yarns on job work has been excluded from the purview of notification No. 214/86- Central Excise. F HEALTH 1) Existing concessional rate of excise duty of 16% to ambulances for Government run hospitals has been extended to all ambulances. 2) Rehabilitation aids such as talking books, talking calculators, talking thermometers, Braille writers, Braille computer terminals have been exempted from excise duty. 3) Excise duty exemption available to diagnostic kits used for detecti....
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....aws to allow compounding of offences either before or after initiation of proceedings. 2) A provision is being made in the Central Excise Act to enable recovery of arrears of revenue including interest from the person, to whom the person liable to pay arrears, has transferred his business property. 3) Provisions are being made in the Central Excise Act to debar the adjudicating authority, Commissioner (Appeals), and the Appellate Tribunal, from granting more than three adjournments of personal hearings to a party. 4) A section note is being inserted in section XV of the First Schedule to the Central Excise Tariff Act so as to provide that 'the process of drawing or redrawing a rod, wire or any other similar article, into wire' shall amount to 'manufacture'. 5) The Third Schedule to the Central Excise Act has been amended to extend the provisions of section 2(f)(iii) of the said Act to monochrome (black & white) television sets. 6) Amendments have been made in Cenvat Credit Rules, 2002, so as to provide that AED(GSI) paid on inputs on or after the 1st of April, 2000, would be eligible for utilization towards payment of Cenvat duty. 7) Customs Act, Central Excise Ac....
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....o include 'sub-brokers'. (3) Cable operator service to include 'Multi System Operators (MSO)'. (4) Business auxiliary service also to include service relating to procurement of inputs, production of goods or provision of services on behalf of client. However, activities amounting to manufacture are specifically excluded from the scope of the service tax. website: http://indiabudget.nic.in 20 (5) Financial services also to include other specified financial services, namely, lending, issue of pay order, demand draft, cheque, letter of credit, bill of exchange, providing a bank guarantee, overdraft facility, bill discounting, safe deposit, lockers, or safe vaults and operation of bank accounts. The interest amount would, however, remain excluded from the purview of service tax. In addition to banking company, financial institutions including a non-banking financing company, body corporates, any other commercial concern providing financial services will also be covered. (6) Tour operator services will include such package tour operators also who organize tours involving any mode of transport. (VI) FOLLOWING SERVICE TAX EXEMPTIONS ARE BEING REMOVED: 1) Exemption ....