TaxTMI 
TaxTMI 
Finance Act, 2000—Explanatory notes on provisions relating to direct taxes
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.... and 10B of the Income-tax Act, 1961 ; amended sections 23, 23A and 24 of the Wealth-tax Act, 1957 ; amended section 4 of the Interest-tax Act, 1974 ; amended sections 88 and 90 of the Finance Act, 1998 ; amended Part III of the First Schedule of the Finance Act, 1998. 3. Provisions in brief : 3.1. The provisions of the Act in the sphere of direct taxes relate to the following matters : (i) Prescribing the rates of income-tax on incomes liable to tax for the assessment year 2000-2001 ; the rates at which tax will be deductible at source in the financial year 2000-2001 from interest (including interest on securities), winnings from lotteries or cross-word puzzles, winnings from horse races, insurance commission and other categories of income liable for tax deduction at source under the Income-tax Act, rates for computing "advance tax", deduction of income-tax from "salaries" and charging of income-tax on current incomes in certain cases for the financial year 2000-2001. (ii) Clarification of the definition of "agricultural income" ; —changing the conditions for demergers arising out of splitting up or the reconstruction of any authority or a body or a lo....
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....rd to transfer of assets in a demerger ; —specification of identical conditions for demerger of a foreign company holding shares of Indian company and demerger of Indian company ; —rationalisation of the definition of cost inflation index. —modification in the definition of "net worth" in case of slump sale; —providing sunset clauses in sections 54EA and 54EB and introduction of a new section 54EC to ensure focussed investments of capital gains for agricultural finance and development of highways infrastructure ; —extension of scope of section 54F ; —clarification regarding value of assets in amalgamation ; —enhancement of the deduction in respect of repayment of loans taken by a student for pursuing higher studies ; —amendment of the provisions of section 80G to allow as deduction, any sum paid as donation to the Indian Olympic Association or any other notified institutions for development of sports and games ; —modification of various provisions of the Income-tax Act for phasing out of tax concessions in respect of foreign exchange earnings ; —amendment of provision of section 80HHF to extend the benefit to non-corporate entities ....
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....e Finance (No. 2) Act, 1998, relating to "Kar Vivad Samadhan Scheme, 1998" to clarify that the amount payable will be determined at 2 per cent. of the disputed chargeable interest in certain cases ; —amendment of section 90 of the Finance (No. 2) Act, 1998, relating to "Kar Vivad Samadhan Scheme, 1998" to clarify that the time limit of payment within 30 days will commence from the date of receipt of the order of the designated authority determining the sum payable ; —amendment of Part III of the First Schedule to the Finance Act, 1999, so as to provide that surcharge shall be charged on the income referred to in section 115ACA instead of section 115AC. (iii) Amendment of the Wealth-tax Act, 1957, to, —make consequential amendments to sections 23, 24, 31, 34A and 35 of the Wealth-tax Act. (iv) Amendment of the Interest-tax Act, 1994, with a view to, —withdraw the levy of interest-tax from the assessment year 2001-2002. Income-tax 4. Rate structure : 4.1. Rates of income-tax in respect of incomes liable to tax for the assessment year 2000-2001. In respect of incomes of all categories of taxpayers (corporate as well as non-corporate) liable to tax....
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....the financial year 2000-2001 and also for computation of "advance tax" payable during that year in the case of various categories of taxpayers have been specified in Part III of the First Schedule to the Act. These rates are also applicable for charging income-tax during the financial year 2000-2001 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 or assessment of persons who are likely to transfer property to avoid tax, etc. The salient features of the rates specified in the said Part III are indicated in the following paragraphs : 4.3.1. Individuals, Hindu undivided families, etc. Paragraph A of Part III of the First Schedule specifies the rates of income-tax in the case of individuals, Hindu undivided families, association of persons, etc. There is no change in the rate structure. However, the tax payable would be enhanced by a surcharge for the purposes of the union at the rate of ten per cent. of the tax payable (after allowing rebate under Chapter VIII-A of the Income-tax Act) in cases of pe....
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.... Nil Nil 60,100 1,100 1,100superparanumonly Nil Nil 60,120 1,120superparanumonly 1,120superparanumonly Nil Nil 60,130 1,129 1,129 Nil Nil 60,150 1,133 1,133 Nil Nil 65,000 2,200 2,200 Nil Nil 75,000 4,400 4,400 Nil Nil 1,50,000 20,900 20,900 Nil Nil 1,50,100 20,933 21,000 67 0.32 1,50,500 21,065 21,400superparanumonly 335 1.59 1,51,000 21,230 21,900superparanumonly 670 3.16 1,51,400 21,362 22,300superparanumonly 938 4.39 1,51,450 21,379 22,350superparanumonly 971 4.54 1,51,460 21,382 22,354 972 4.55 1,52,000 21,560 22,540 980 4.55 2,00,000 37,400 39,100 1,700 4.55 3,00,000 70,400 73,600 3,200 4.55 4,00,000 1,03,400 1,08,100 4,700 4.55 5,00,000 1,36,400 1,42,600 6,200 4.55 4.3.3. Co-operative societies : In the case of co-operative societies the rates of income-tax have been specified in Paragraph B of Part III of the First Schedule to the Act. These rates are the same as those specified in the corresponding ....
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....planation in section 2(1A) to clarify that any income from such building or land arising from the use of the building or land for any purpose other than agriculture shall not be included in the definition of "agricultural income". For example, if a person has income from using such building or land for purposes such as letting it out for residential purposes or for the purposes of any business or profession, then, such income shall not be treated as agricultural income. 5.3. This amendment shall take effect from the 1st day of April 2001 and will, accordingly, apply to the assessment year 2001-2002 and subsequent years. [Section 3(a)] 6. Modification of conditions for units arising out of splitting up or the reconstruction of any authority or a body or a local authority or a public sector company to be covered under demerger : 6.1. Explanation 4 of section 2(19AA) as inserted by the Finance Act of 1999, provided that the splitting up or reconstruction of any authority or body constituted under a Central, State or Provincial Act or a local authority or a public sector company into separate bodies or authorities shall be deemed to be demerger on fulfilling the conditions ....
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....y extending it to the employees of a public sector company on the termination of their services under a voluntary separation scheme framed in accordance with the guidelines issued in this regard. 8.3. Under the existing provisions, the first proviso of section 10(10C) states that the scheme in relation to companies (other than public sector companies or co-operative societies) is required to be approved by the Chief Commissioner or the Director-General of Income-tax. To simplify and expedite the procedure relating to exemption of amounts received under a Voluntary Retirement Scheme framed as per the guidelines, it has been provided to dispense with the requirement of such approval. 8.4. These amendments will take effect from the 1st day of April, 2001 and will, accordingly, apply in relation to the assessment year 2001-2002 and subsequent years. [Section 5(a)] 9. Tax exemption to certain bonds issued by local authorities : 9.1. The local authorities such as Municipal Corporations, Municipal authorities, etc. need large amounts of funds to finance urban infrastructure projects such as potable water supply, sewerage and sanitation, drainage, solid waste management, roa....
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....ent year 2001-2002 and subsequent years. [Sections 5 and 31] 12. Exemption of income of investor protection fund 12.1. The stock exchanges are required to set up an investor protection fund in accordance with the directives of the Ministry of Finance and Securities and Exchange Board of India (SEBI). The fund is set up exclusively to compensate the investors who may suffer a loss in the event of a broker defaulting in the stock exchange concerned. 12.2. Clause (23E) of section 10 provides that the income of notified exchange risk administration fund set up by public financial institutions is exempt from income-tax. 12.3. On similar lines it has been provided by the Act that income of notified investor protection fund set up by recognized stock exchanges of India will not be included while computing the total income. 12.4. However, where any amount standing to the credit of the fund and not charged to income-tax during any previous year is shared, wholly or partly with a recognized stock exchange, the amount shared shall be deemed to be the income of the previous year in which such amount is so shared. 12.5. The amendment will take effect from the 1st day of Apr....
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....enture capital undertaking, shall not apply to any investment made after March 31, 2000. Such investment will qualify for exemption under the newly inserted clause (23FB) in section 10. 13.7. A new Chapter XII-F containing special provisions relating to tax on income received from venture capital companies and venture capital funds has been inserted by the Act. 13.8. Section 115U of this Chapter provides that, (i) any income received by a person out of investments made in a venture capital company or a venture capital fund shall be chargeable to income-tax as if it were the income received by such person from investments made directly in the venture capital undertaking ; (ii) the person responsible for making payment of the income on behalf of a venture capital company or a venture capital fund and the venture capital company or the venture capital fund will be required to furnish within the prescribed time a statement in the prescribed form and verified in the prescribed manner giving details of the nature of income distributed during the previous year. This statement is to be furnished to the person receiving such income and to the prescribed income-tax authority ; ....
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....aid clause. These amendments are consequential to the amendment of section 10(23G) by the Finance Act, 1999. 14.5. These amendments will take effect retrospectively from 1st April, 2000, and will accordingly, apply in relation to the assessment year 2000-2001 and subsequent years. [Section 5(g)] 15. New provisions substituted for existing sections 10A and 10B : (Special provision in respect of newly established undertakings in specified Free Trade Zones, Electronic Hardware Technology Parks, Software Technology Parks or any Special Economic Zones or in respect of Export Oriented Units, etc.). 15.1. Under the existing provisions, new undertakings set up in notified Free Trade Zones and Export Processing Zones are entitled to a ten-year tax holiday under section 10A of the Income-tax Act. Similarly, section 10B of the Income-tax Act allows a ten-year tax holiday to export oriented undertakings (EOUs), which manufacture or produce any article or thing. The provision of section 10B was introduced by the Finance Act, 1988. The Finance Act, 1993, extended the tax holiday under section 10A to industrial units in approved Electronic Harware Technology Parks (EHTP) or Softwar....
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....ia should be received in or brought into India within a period of six months from the end of the previous year or within such further period as the competent authority may allow. If sale proceeds are credited to a separate account maintained for the purpose with any bank outside India, with the approval of the Reserve Bank of India, the sale proceeds shall be deemed to have been received in India. 15.6. For the computation of profits derived from the export of articles or things or computer software, sub-section (4) provides that the profits derived from such exports shall be the amount which bears to the profits of the business, the same proportion as the export turnover in respect of such articles or things or computer software bears to the total turnover of business. The profits of the business in the given context would mean the profits of the business carried on by the undertaking to which the provisions apply. The working formula for arriving at the export profits will be as under : Export Turnover Export Profits = Profits of the undertaking &....
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..... of the voting power on the last day of the year in which the undertaking was set up, the company shall be deemed to have transferred its ownership or the beneficial interest in the undertaking. 15.10. The scheme of the substituted section retains parts of the earlier provisions. Where an assessee avails of benefit of section 10A (or section 10B), it will not be eligible for other tax concessions available under other provisions of the Act, during the period of ten years, or at any time after the expiry of this period. For this purpose, sub-section (6) provides that the provisions for depreciation under section 32, investment allowance under section 32A, development rebate under section 33, expenditure on scientific research under section 35 and capital expenditure in relation to family planning under section 36(1)(ix) shall apply as if all allowances or deduction specified therein have been given full effect to. Consequently, the respective unabsorbed amounts cannot be carried forward or set off against profits of any subsequent year. In other words, it is presumed that the allowances for depreciation, investment allowance, development rebate, capital expenditure on scientific....
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.... mentioned in sub-section (5) of section 11. 16.3. Under the provisions of clause (vii) of sub-section (5) of section 11, investment or deposit in any public sector company is specified as an eligible mode of investment for charitable trusts. The benefit of exemption is not available if a trust holds any shares of a company other than a public sector company. Some public sector companies may cease to be a public sector company, after disinvestment by the Government. 16.4. It has been provided by the Act that an investment or deposit in a public sector company shall continue to be one of the eligible modes of investment for charitable or religious trusts, for a period of three years (in the case of shares), and the date of maturity of other investments or deposits, from the date a public sector company ceases to be a public sector company. 16.5. This amendment will take effect from 1st April, 2001, and will accordingly, apply in relation to the assessment year 2001-2002 and subsequent years. [Section 8] 17. Charitable trusts allowed to invest funds in long-term finance for urban infrastructure : 17.1. Under clause (ix) of sub-section (5) of section 11, deposits wit....
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....ng provisions provide that the difference between market price on the date of exercise of the option and the price paid by the employee for acquiring the shares will be regarded as perquisites and the difference between the fair market value on the date of exercise of option and the actual sale price in the event of transfer of shares by the employee shall be regarded as capital gains. 19.2. The Act makes a departure and provides that no perquisite shall be charged to tax in the hands of the employee in respect of benefits derived as a result of allotment of shares/debentures or warrants directly or indirectly under the employees stock option plan or scheme. This is sought to be done by deleting section 17(2)(iiia) and providing an Explanation below section 17(2)(iii). Sub-section (2B) in section 49 inserted by the Finance Act, 1999, has also been deleted. Under the amended provisions, such shares will only be subjected to capital gains tax at the time of sale by the employee. The difference between the consideration and the cost of acquisition will be regarded as the amount of capital gains under normal provisions of law. However, the new provisions shall be applicable only in ....
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....cult to include arrears of rent in the relevant years as these were not receivable during those years. Difficulties in taxing such income as income from other sources also came to notice on account of a possible view that such income retains the character of income from house property. 21.2. With a view to set all such doubts at rest and to clarify the matter, the Act inserts a new section 25B in the Income-tax Act to provide that where any arrears of rent, other than what has already been taxed under section 23, are received in a subsequent year, the same will be deemed to be the income from property and charged to tax in the year of receipt whether the property is owned by the assessee in the year of receipt or not. A deduction of a sum equal to one-fourth of such amount of rent shall be given towards repairs and collection of rent. 21.3. This amendment will take effect from 1st April, 2001, and will, accordingly, apply in relation to the assessment year 2001-2002 and subsequent years. [Section 13] 22. Requirement of continuance of same business for set-off of unabsorbed depreciation dispensed with : 22.1. Under the existing provisions of sub-section (2) of section....
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....d section 35(2AB) so as to enhance the existing deduction from one and one-fourth times of the expenditure to one and one half times the expenditure incurred on scientific research on in-house research and development facility. 24.3. This amendment will take effect from the 1st April, 2001, and will, accordingly, apply in relation to the assessment year 2001-2002 and subsequent years. [Section 16] 25. Amendments consequential to the removal of requirement of approval of the Central Government under section 36(1)(viii) : 25.1. As a measure of simplification, the Finance Act, 1999, dispensed with the requirement of approval by the Central Government for the purposes of clause (viii) of sub-section (1) of section 36. As a consequence to this, the Act has made amendments in sections 10(15)(iv)(g), 11(5)(viii), 11(5)(ix), 35D(3), 36(1)(viia), 43B, 80L(1)(vii), 80L(1)(x), 88(2)(xv) and 194A(3). 25.2. These amendments will take effect retrospectively from the 1st April, 2000, and will, accordingly, apply in relation to the assessment year 2000-2001 and subsequent years. [Sections 5, 8, 17, 18, 20, 40, 46 and 60] 26. Written down value to be the basis of adjustment in ....
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....of shares. 27.3. This amendment will take effect retrospectively from 1st April, 2000, and shall accordingly apply in relation to the assessment year 2000-2001 and subsequent years. [Section 21] 28. Rationalisation of the definition of cost inflation index : 28.1. Cost inflation index has been defined in clause (v) of Explanation to section 48 of the Income-tax Act, to be the index which the Central Government may notify having regard to seventy-five per cent. of average rise in consumer price index for urban non-manual employees (CPI-UNME) for that year. Since the index has to be notified in the beginning of the year in relation to transfer of assets to be effected in that year so as to calculate the amount of instalment of advance tax payable, it has to be in relation to the 1st day of April of that year and has to be calculated on the basis of average rise in consumer price index in the preceding previous year. The notifications have been issued all along on this basis. To put the issue beyond any possible controversy, the Act amends clause (v) of the Explanation to section 48 retrospectively to provide that the cost inflation index for any previous year will be such....
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.... basket of investment options to absorb taxable capital gains arising from transfer of long-term capital assets. The notified instruments providing the roll-over to capital gains include shares, bonds, units and deposits of banks and various other instruments. The two sections were introduced in 1996 to give an incentive to the development of infrastructure. However, the objective has been diluted in the presence of a large number of varied and diverse instruments. Further, incentives to infrastructure are also available under other sections of the Income-tax Act such as sections 80-IA, 80-IB and 10(23G). In a regime of low tax rate on long-term capital gains, there is very little justification for having such an omnibus basket of exemptions. Therefore, it has been decided to insert sunset clauses to sections 54EA and 54EB limiting their application to transfers of long-term capital asset made on or before 31st March, 2000. Where the capital gain has arisen on transfers made before March 31, 2000, the investments in notified securities can be made under sections 54EA and 54EB beyond that date but within the stipulated period. 30.2. In place of sections 54EA and 54EB, which are b....
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....ain applicable. 31.2. This amendment will take effect from the 1st day of April, 2001, and will accordingly apply to the assessment year 2001-2002 and subsequent years. [Section 28] 32. Clarification regarding value of assets in amalgamation : 32.1. The existing provisions relating to amalgamation in clause (i) of sub-section (2) of section 72A state that the amalgamated company shall hold continuously for a minimum period of five years, at least three-fourths in value of assets of the amalgamating company being acquired in a scheme of amalgamation. Issues have been raised regarding the exact connotation of "value" and "assets" especially whether the assets would include the current assets, which change from day-to-day. 32.2. The Act amends clause (i) of sub-section (2) of section 72A to clarify that the assets referred to in this clause are "fixed assets" and the value, is the "book value". 32.3. This amendment will take effect retrospectively from 1st April, 2000, and shall accordingly apply in relation to the assessment year 2000-2001 and subsequent years. [Section 29] 33. Deduction in respect of repayment of loan taken by a student for pursuing higher st....
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.... such assessee being a tour operator or a "travel agent" is allowed a deduction, in computing its total income, of a sum equal to— (i) Fifty per cent. of the profits derived from services provided to foreign tourists ; and (ii) So much of the profits as are credited to a reserve fund to be utilized in the manner specified in sub-section (4) of that section. 34.4. Under section 80R of the Income-tax Act, a professor, teacher or research worker rendering service abroad, is entitled to a deduction from the remuneration received from a foreign university, institution, etc., while computing his income chargeable to tax. The deduction is of an amount equal to seventy five per cent. of such remuneration. 34.5. Under section 80RR, a similar deduction is available to an artist, playwright, musician, actor, etc., deriving income from a foreign source, in exercise of his profession. 34.6. A similar deduction is also available under section 80RRA, to persons rendering service outside India. 34.7. The amendment seeks to phase out all the above benefits over a five-year period. This would imply that under the provisions of sections 80HHC, 80HHE and 80HHF, the assessee would b....
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.... infrastructure facilities in the nature of roads, highways, bridges, airports, ports, rail system or any other public facility of a similar nature. Water supply projects, irrigation projects, sanitation and sewerage systems also form part of infrastructure facilities under the provision. 36.2. The country needs large investments in the areas of urban infrastructure, including public health. In order to attract commercial enterprises to operate such facilities, the Act proposes to extend the benefit of tax holiday to water treatment and solid waste management systems as well. 36.3. The Finance Act, 1999, substituted new provisions sections 80-IA and 80-IB in place of the existing section 80-IA. Sub-section (3) of section 80-IA provides that the newly introduced provisions of section 80-IA would apply to any industrial undertaking that fulfils certain conditions. Doubts were raised in certain quarters that no reference having been made to sub-section (4), the deduction may be applicable to any industrial undertaking. This was not the intention of the Legislature. To remove any doubts in this regard, the words "any industrial undertaking" have been substituted by the words, "in....
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.... period of ten years is reckoned from the year in which approval is given by the prescribed authority. To avail of this benefit, such company— (i) should be registered in India ; (ii) should have its main object to the scientific research and development ; (iii) should be approved by the prescribed authority at any time after 31st March, 2000, but before the 1st April, 2003 ; (iv) should fulfil such other conditions as may be prescribed. 38.2. Other conditions and requirements as are applicable to section 80-IB will continue to apply to this provision. 38.3. The amendment will take effect from 1st April 2001, and shall be applicable for the assessment year 2001-2002 and subsequent years. [Section 39] 39. Rebate of income-tax in case of senior citizens : 39.1. Section 88B of the Income-tax Act provides for a special relief in the form of rebate of an amount equal to hundred per cent. of income-tax or an amount of ten thousand rupees, whichever is less, to individual residents in India who attain the age of sixty-five years or more at any time during the previous year. 39.2. The rebate to the senior citizens has been provided to help them in meet....
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....s shall not exceed 10 per cent. of the capital gains before allowing adjustment for cost inflation index. The definition of securities follows the definition given in clause (h) of section 2 of the Securities Contracts (Regulation) Act, 1956. 42.2. The Act amends the proviso to sub-section (1) of section 112 to provide that long-term capital gains arising from transfer of units of the Unit Trust of India and units of mutual funds specified under section 10(23D) of the Income-tax Act shall also not exceed 10 per cent. of the capital gains before allowing adjustment for cost inflation index. 42.3. This amendment takes effect retrospectively from the 1st day of April, 2000, and shall accordingly apply in relation to the assessment year 2000-2001 and subsequent years. [Section 49] 43. Minimum Alternate Tax on companies : 43.1. In recent years, as the number of zero tax companies and companies paying marginal tax had grown, minimum alternate tax was levied under section 115JA of the Income-tax Act from the assessment year 1997-98. The efficacy of the existing provision, however, declined in view of the exclusions of various sectors from the operation of MAT and the credit....
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....rged under the Income-tax Act for various defaults has been reduced by the Finance Act, 1999 from 2 per cent. to 1.5 per cent. Sections 234A and 234B respectively, have also been amended by the Finance Act, 1999 with effect from 1st June, 1999, to reduce the interest charged under these sections from two per cent. per month to one and a half per cent. per month. 44.5. In view of the above, the Act amends section 115P to bring down the rate of interest to be charged under section 115P from two per cent. per month to one and a half per cent. per month with effect from 1st June, 2000, so that there is uniformity in the rate of penal interest being charged under the Income-tax Act under different provisions. 44.6. These amendments will take effect from the 1st day of June, 2000. [Sections 53 and 54] 45. Tax on income distributed by Unit Trust of India and mutual funds : 45.1. Under the existing provisions, any amount of income distributed by the Unit Trust of India or by mutual funds to their unit holders is chargeable to tax and the Unit Trust of India or mutual funds are liable to pay tax on such distributed income at the rate of ten per cent. The provisions of section....
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....n by whom tax is payable. Further, any person may apply to the Assessing Officer for allotment of PAN and the same shall be allotted to him. 46.2. With a view to progressively making PAN a common business identification number for other Departments such as the Central Board of Excise and Customs and the Director-General of Foreign Trade, the Act delegates power to the Central Government to notify a class or classes of persons, for whom it will be obligatory to apply for PAN. However, in relation to such class or classes of persons, tax has to be payable under the Income-tax Act or any tax or duty has to be payable under any other law in force. The power has also been delegated to notify importers and exporters whether any tax or duty is payable by them or not. 46.3. This amendment takes effect from the 1st day of June, 2000. [Section 58] 47. Insertion of reference to section 246A of the Income-tax Act and section 23A of the Wealth-tax Act at several places in the respective Acts : 47.1. Appeal lies before the Commissioner (Appeals) under section 246A of the Income-tax Act and under section 23A of the Wealth-tax Act, as the case may be, on or after October 1, 1998. Co....
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....d one hundred thousand rupees. 49.2. A large number of representations had been received from various quarters pointing out various difficulties which had arisen on account of operation of this provision. Keeping in view these difficulties, the Act has amended section 194L to provide that no deduction shall be made under the said section from any payment made on or after 1st June 2000. 49.3. This amendment will take effect from 1st June, 2000. [Section 61] 50. Provisions relating to the Authority for Advance Rulings rationalised for resident applicants : 50.1. The provisions relating to the Authority for Advance Rulings were extended to notified categories of resident applicants through amendments carried out by the Finance (No. 2) Act, 1998. The definition of advance ruling was broadened to include decision on question of law or fact arising out of the order of assessment. The Central Government has already notified two classes of persons which are public sector companies and persons seeking advance ruling in relation to transactions undertaken or proposed to be undertaken by a resident with a non-resident. 50.2. These provisions needed to be further streamlined.....
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....ory of resident applicants only when the issue is pending in a court. The existing conditions in clause (b) relating to bar of determination of the fair market value of any property will continue. The existing condition in clause (c) relating to an issue designed prima facie for avoidance of income-tax shall not be applicable to the notified category of resident applicants. 50.7. These amendments take effect from the 1st day of June, 2000. [Sections 63 and 64] 51. Sunset clauses to sub-sections (1) and (2) of section 246 of the Income-tax Act : 51.1. Section 246 of the Income-tax Act in sub-sections (1) and (2) lists out the orders passed by the Assessing Officer against which appeals may be filed before the Deputy Commissioner (Appeals) and the Commissioner (Appeals), respectively. Section 246A providing for appeals before the Commissioner (Appeals) was introduced by the Finance (No. 2) Act, 1998, with effect from 1st October, 1998, in respect of appeals against orders made before or after the appointed day. The appointed day was notified as 1st October, 1998. The introduction of a new section was necessitated by the decision to do away with one appellate level at the ....
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....is filed under sub-section (1) of section 253. It refers to appeals filed by the assessee. 53.2. The Act amends sub-section (2A) of section 254 to extend the advisory time-limit to the appeals filed by the Commissioner under sub-section (2) of section 253. Similar amendments have been made in sub-section (5A) of section 24 of the Wealth-tax Act, 1957. 53.3. These amendments take effect from the 1st day of June, 2000. [Sections 68 and 73] 54. Increase in the limit for submission of statements by the film producers : 54.1. Under the existing provisions of section 285B of the Income-tax Act, any person carrying on the production of cinematograph films is required to prepare and deliver or cause to be delivered to the Assessing Officer within 30 days from the end of the financial year or within 30 days of the completion of the film, whichever is earlier, a statement in the prescribed form containing particulars of all payments of over Rs. 25,000 in aggregate made by him or due from him to each such person as is engaged by him in such production. 54.2. The Act has raised the monetary limit for furnishing the above statement from Rs. 25,000 to Rs. 50,000. 54.3. This ....
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....Act, therefore, amends sub-clause (ii) in clause (e) to remove the anomaly and to clarify that the amount payable in such cases will be determined at two per cent. of the disputed chargeable interest. 55.4. These amendments take effect retrospectively from the 1st day of September, 1998. [Section 121] 56. Amendment of Part III of First Schedule to the Finance Act, 1999 : 56.1. Part III of the First Schedule to the Act specifies the rates at which income-tax is to be deducted at source from "salaries" and also the rates at which "advance tax" is to be paid and income-tax is to be calculated or charged in special cases for the financial year 1999-2000. 56.2. The Act amends Part III of the First Schedule to the Finance Act, 1999, so as to provide that surcharge shall be charged on the income referred to in section 115ACA, instead of section 115AC. This amendment is clarificatory in nature. 56.3. This amendment will take effect retrospectively from 1st April, 1999. [Section 122] Wealth-tax provisions The amendments made in the Wealth-tax Act by the Finance Act, 2000, which are of consequential nature, have already ....