TaxTMI 
TaxTMI 
PROVISIONS RELATING TO DIRECT TAXES & RELATED LAWS
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.... (G) Strengthening anti-abuse measures (H) Removing difficulties faced by taxpayers (I) Rationalisation of provisions (J) Miscellaneous DIRECT TAXES A. RATES OF INCOME-TAX I. Rates of income-tax in respect of income liable to tax for the assessment year 2019-20. In respect of income of all categories of assessees liable to tax for the assessment year 2019-20, the rates of income-tax have been specified in Part I of the First Schedule to the Bill. These are the same as those laid down in Part III of the First Schedule to the Finance Act, 2018 for the purposes of computation of "advance tax", deduction of tax at source from "Salaries" and charging of tax payable in certain cases. (1) Surcharge on income-tax The amount of income-tax shall be increased by a surcharge for the purposes of the Union,- (a) in the case of every individual or Hindu undivided family or every association of persons or body of individuals, whether incorporated or not, or every artificial juridical person referred to in sub-clause (vii) of clause (31) of section 2 of the Act,- (i) at the rate of ten per cent. of such tax, where the income or the agg....
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....ble), the surcharge shall be levied at the rate of twelve per cent. Surcharge shall also be levied at the rate of twelve per cent. on additional Income-tax chargeable under newly inserted sub-section (2A) in existing section 92CE. (2) Marginal Relief- Marginal relief has also been provided in all cases where surcharge is proposed to be levied. (3) Health and Education Cess- For assessment year 2019-20, "Education Cess on income-tax" and "Secondary and Higher Education Cess on income-tax" has been discontinued. However, a new cess, by the name of "Health and Education Cess" has been levied at the rate of four per cent. on the amount of income tax so computed, inclusive of surcharge, wherever applicable, in all cases. No marginal relief is available in respect of such cess. II. Rates for deduction of income-tax at source during the financial year 2019-20 from certain incomes other than "Salaries". The rates for deduction of income-tax at source during the financial year 2019-20 on certain incomes other than "Salaries" have been specified in Part II of the First Schedule to the Bill. The rates for all the categories of persons will remain the same as those specified ....
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....pees. No surcharge will be levied on deductions in other cases. (2) Health and Education Cess- "Health and Education Cess" shall continue to be levied at the rate of four per cent. of income-tax including surcharge wherever applicable, in the cases of persons not resident in India, including company other than a domestic company. III. Rates for deduction of income-tax at source from "Salaries", computation of "advance tax" and charging of income-tax in special cases during the financial year 2019-20. The rates for deduction of income-tax at source from "Salaries" during the financial year 2019-20 and also for computation of "advance tax" payable during the said year in the case of all categories of assessees 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 2019-20 on current incomes in cases where accelerated assessments have to be made, for instance, provisional assessment of shipping profits arising in India to non-residents, assessment of persons leaving India for good during the financial year, assessment of persons who are likely to transfer property t....
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....person having total income exceeding,- (i) fifty lakh rupees but not exceeding one crore rupees, the total amount payable as income-tax and surcharge on such income shall not exceed the total amount payable as income-tax on a total income of fifty lakh rupees by more than the amount of income that exceeds fifty lakh rupees; (ii) one crore rupees but not exceeding two crore rupees, the total amount payable as income-tax and surcharge on such income shall not exceed the total amount payable as income-tax on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees; (iii) two crore rupees but not exceeding five crore rupees, the total amount payable as income-tax and surcharge on such income shall not exceed the total amount payable as income-tax on a total income of two crore rupees by more than the amount of income that exceeds two crore rupees; and (iv) five crore rupees, the total amount payable as income-tax and surcharge on such income shall not exceed the total amount payable as income-tax on a total income of five crore rupees by more than the amount of income that exceeds five crore rupees. B. Co-....
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....does not exceed four hundred crore rupees, and in all other cases the rate of Incometax shall be thirty per cent. of the total income. In the case of company other than domestic company, the rates of tax are the same as those specified for the financial year 2018-19. Surcharge at the rate of seven per cent. shall continue to be levied in case of a domestic company, if the total income of the domestic company exceeds one crore rupees but does not exceed ten crore rupees. Surcharge at the rate of twelve per cent. shall continue to be levied if the total income of the domestic company exceeds ten crore rupees. In case of companies other than domestic companies, the existing surcharge of two per cent. shall continue to be levied, if the total income exceeds one crore rupees but does not exceed ten crore rupees. Surcharge at the rate of five per cent. shall continue to be levied, if the total income of the company other than domestic company exceeds ten crore rupees. However, the total amount payable as income-tax and surcharge on total income exceeding one crore rupees but not exceeding ten crore rupees, shall not exceed the total amount payable as income-tax on a total income of one c....
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....on Account Number (TAN). This amendment will take effect from 1st September, 2019. [Clause 46] TDS at the time of purchase of immovable property Section 194-IA of the Act relates to payment on transfer of certain immovable property other than agricultural land and provides for levy of TDS at the rate of one per cent. on the amount of consideration paid or credited for transfer of such property. The term 'consideration for immovable property' is presently not defined for the purposes of this section. It is noted that in the transaction involving purchase of immovable property, there are other types of payments made besides the sales consideration and the buyer is contractually bound to make such payments to the builder/seller, either under the same agreement or under a different agreement. Some of such payments are those for rights to amenities like club membership fee, car parking fee, electricity and water facility fees, maintenance fee, advance fee etc. Accordingly, it is proposed to amend the Explanation to said section and provide that the term "consideration for immovable property" shall include all charges of the nature of club membership fee, car parking fe....
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.... to amend section 139 of the Act so as to provide that a person shall be mandatorily required to file his return of income, if during the previous year, he- (i) has deposited an amount or aggregate of the amounts exceeding one crore rupees in one or more current account maintained with a banking company or a co-operative bank; or (ii) has incurred expenditure of an amount or aggregate of the amounts exceeding two lakh rupees for himself or any other person for travel to a foreign country; or (iii) has incurred expenditure of an amount or aggregate of the amounts exceeding one lakh rupees towards consumption of electricity; or (iv) fulfils such other prescribed conditions, as may be prescribed. Further, currently, a person claiming rollover benefit of exemption from capital gains tax on investment in specified assets like house, bonds etc., is not required to furnish a return of income, if after claim of such rollover benefits, his total income is not more than the maximum amount not chargeable to tax . In order to make furnishing of return compulsory for such persons, it is proposed to amend the sixth proviso to section 13....
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....ay be, has been duly quoted. A new sub-section (6A) is also proposed to be inserted to ensure quoting of PAN or Aadhaar number for entering into prescribed transactions and authontication thereof in the prescribed manner. Duty is also proposed to be cast upon the person receiving any document relating to such transactions, through newly proposed sub-section (6B), to ensure that PAN or Aadhaar number, as the case may be, is duly quoted, and authenticated. In order to ensure proper compliance of the provisions relating to quoting and authentication of PAN or Aadhaar, the penalty provision contained in section 272B is proposed to be amended suitably. These amendments will take effect from 1st September, 2019. [Clauses 40 & 64] Consequence of not linking PAN with Aadhaar The existing proviso to the sub-section (2) of section 139AA, provides that the PAN allotted to a person shall be deemed to be invalid, in case the person fails to intimate the Aadhaar number, on or before the notified date. In order to protect validity of transactions previously carried out through such PAN, it is proposed to amend the said proviso so as to provide that if a person fails to int....
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.... of which the assessee makes payment (or an aggregate of payments) exceeding rupees ten thousand to a person in a day through any mode other than an account payee cheque or an account payee bank draft or using the electronic clearing system through a bank account. Section 40A of the Act provides for disallowance of any expenditure for which the assessee makes payment (or an aggregate of payments) exceeding rupees ten thousand through any mode other than an account payee cheque or an account payee bank draft or using the electronic clearing system through a bank account. Sub-section (1) to section 43 of the Act provides the definition of the term "actual cost". The second proviso to the said section specifies that where the assessee incurs any expenditure for the acquisition of an asset or part thereof, and in respect of such acquisition, he makes a payment or aggregate of payments exceeding rupees ten thousand in a day to a person in any mode other than an account payee cheque or an account payee bank draft or using the electronic clearing system through a bank account, then such expenditure shall not be included in the determination of the actual cost....
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.... of an account payee cheque or an account payee bank draft or the electronic clearing system through a bank account. These amendments will take effect from 1st April, 2020 and will, accordingly apply in relation to assessment year 2020-2021 and subsequent assessment years. [Clauses 8,9,11,12,14,16, 18, 21 & 27] Similarly section 269SS of the Act prohibits a person from taking or accepting from a depositor any loan or deposit or any specified sum equal to rupees twenty thousand or more otherwise than by an account payee cheque or an account payee bank draft or by use of electronic clearing system through a bank account. Section 269ST of the Act prohibits a person from receiving an amount of rupees two lakh or more in aggregate from a person in a day or in respect of a single transaction or in respect of transactions relating to one event or occasion from a person otherwise than by an account payee cheque or an account payee bank draft or by use of electronic clearing system through a bank account. Section 269T of the Act prohibits a banking company or a co-operative bank and any other company or co-operative society and any firm or other person from repaying any loan ....
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....r or gross receipts in business exceeds fifty crore rupees during the immediately preceding previous year. In order to ensure compliance of the aforesaid provisions, it is further proposed to insert a new section 27IDB to provide that the failure to provide facility for electronic modes of payment prescribed under section 269SU shall attract penalty of a sum of five thousand rupees, for every day during which such failure continues. However, the penalty shall not be imposed if the person proves that there were good and sufficient reasons for such failure. Any such penalty shall be imposed by the Joint Commissioner. This amendment will take effect from 1st November, 2019. [Clauses 59 & 62] Further, it is proposed to make a consequential amendment in the Payment and Settlement Systems Act, 2007 so as to provide that no bank or system provider shall impose any charge upon anyone, either directly or indirectly, for using the modes of electronic payment prescribed under section 269SU of the Income-tax Act. This amendment will take effect from 1st November, 2019. [Clause 194] D.TAX INCENTIVES Incentives to International Financial Serv....
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....or after the 1st day of April, 2017, out of its current income, either in the hands of the company or the person receiving such dividend. To facilitate distribution of dividend by companies operating in IFSC, it is proposed to amend the provision of the said section to provide that any dividend paid out of accumulated income derived from operations in IFSC, after 1st April 2017 shall also not be liable for tax on distributed profits. This amendment will take effect from 1st September, 2019. [Clause 35] D) The existing provisions of the section 115R of the Act, provide that any amount of income distributed by the specified company or a Mutual Fund to its unit holders shall be chargeable to tax and such specified company or Mutual Fund shall be liable to pay additional income-tax on such distributed income. In order to incentivize relocation of Mutual Fund in IFSC, it is proposed to amend the said section so as to provide that no additional income-tax shall be chargeable in respect of any amount of income distributed, on or after the 1st day of September, 2019, by a Mutual Fund of which all the unit holders are non-residents and which fulfills certain other specified c....
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....an exception to the accrual system of accounting which is regularly followed by such assessees for computation of total income. The benefit of this provision is presently available to public financial institutions, scheduled banks, cooperative banks, State financial corporations, State industrial investment corporations and public companies like housing finance companies. With a view to provide a level playing field to certain categories of NBFCs who are adequately regulated, it is proposed to amend section 43D of the Act so as to include deposit-taking NBFCs and systemically important non deposit-taking NBFCs within the scope of this section. Consequentially, as per matching principle in taxation, it is proposed to amend section 43B of the Act to provide that any sum payable by the assessee as interest on any loan or advances from a deposit-taking NBFCs and systemically important non deposit-taking NBFCs shall be allowed as deduction if it is actually paid on or before the due date of furnishing the return of income of the relevant previous year. These amendments will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-21 ....
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....ns: (i) the loan has been sanctioned by a financial institution including a non-banking financial company during the period beginning on the 1st April, 2019 to 31st March, 2023; (ii) the assessee does not own any other electric vehicle on the date of sanction of loan. It is also proposed that where a deduction under this section is allowed for any interest, deduction shall not be allowed in respect of such interest under any other provisions of the Act for the same or any other assessment year. This amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to assessment year 2020-2021 and subsequent assessment years. [Clause 25] Exemption of interest income of a non-resident arising from borrowings by way of issue of Rupee Denominated Bonds referred to under section 194LC The existing provisions of section 194LC of the Act provide that the interest income payable to a non-resident by a specified company on borrowings made by it in foreign currency from sources outside India under a loan agreement or by way of issue of any long-term bond including long-term infrastructure bond, or rupee denominated bond shall be eligibl....
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....s. The existing provisions of the section 80-IBA of the Act, inter alia, provide that where the gross total income of an assessee includes any profits and gains derived from the business of developing and building housing projects, there shall, subject to certain conditions, be allowed, a deduction of an amount equal to hundred per cent of the profits and gains derived from such business. With a view to align the definition of "affordable housing" under section 80-IBA with the definition under GST Act, it is proposed to amend the said section so as to modify certain conditions regarding the housing project approved on or after 1st day of September, 2019. The modified conditions are as under: (i) the assessee shall be eligible for deduction under the section, in respect of a housing project if a residential unit in the housing project have carpet area not exceeding 60 square meter in metropolitan cities or 90 square meter in cities or towns other than metropolitan cities of Bengaluru, Chennai, Delhi National Capital Region (limited to Delhi, Noida, Greater Noida, Ghaziabad, Gurgaon, Faridabad), Hyderabad, Kolkata and Mumbai (whole of Mumbai Metropolitan Region); and ....
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.... and set off of losses in case of a company not being a company in which the public are substantially interested. Clause (a) of this section applies to all such companies, except an eligible start-up as referred to in section 80-IAC, while clause (b) applies only to such eligible start-up. Under clause (a), no loss incurred in any year prior to the previous year shall be carried forward and set off against the income of the previous year, unless on the last day of the previous year, the shares of the company carrying not less than fifty-one per cent of the voting power were beneficially held by persons who beneficially held shares of the company carrying not less than fifty-one per cent of the voting power on the last day of the year or years in which the loss was incurred. Under clause (b), the loss incurred in any year prior to the previous year shall be carried forward and set off against the income of the previous year, if, all the shareholders of such company who held shares carrying voting power on the last day of the year or years in which the loss was incurred, continue to hold those shares on the last day of such previous year and such loss has been incurred during t....
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....fer of new asset being computer or computer software from the current five years to three years. This amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-21 and subsequent assessment years. [Clauses 20 & 22] Incentives for Category II Alternative Investment Fund (AIF) The existing provisions of the said section 56 of the Income-tax Act, inter alia, provide that where a company, not being a company in which the public are substantially interested, receives, in any previous year, from any person being a resident, any consideration for issue of shares that exceeds the face value of such shares, the aggregate consideration received for such shares as exceeds the fair market value of the shares shall be charged to tax. However, exemption from this provision has been provided for the consideration for issue of shares received by a venture capital undertaking from a venture capital company or a venture capital fund or by a company from a class or classes of persons as may be notified by the Central Government in this behalf. Currently the benefit of exemption is available to Category I AIF. With a view to f....
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....rescription of exemption from deeming of fair market value of shares for certain transactions: The existing provisions of the section 56(2)(x) of the Income-tax Act, inter alia, provide for chargeability of income in case of receipt of money or specified property for no or inadequate consideration. For determining the amount of income for receipt of certain shares, the fair market value of the shares is taken into account. Similarly, section 50CA provides for deeming of fair market value of unquoted shares for computing the capital gains from the transfer of such shares. For both these provisions, the fair market value is determined based on the prescribed method. Currently, the provisions of section 56(2)(x) are not applicable to certain specified transactions. However, no such exemption is available under section 50CA. Determination of fair market value based on the prescribed rules may result into genuine hardship in certain cases where the consideration for transfer of shares is approved by certain authorities and the person transferring the share has no control over such determination. In order to provide relief to such types of transactions from the applicability ....
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.... not been deducted on payment of interest to residents) in prescribed form in the prescribed manner. It is also proposed to provide for correction of such statements for rectification of any mistake or to add, delete or update the information furnished. It is also proposed to make a consequential amendment arising out of amendment carried out by Finance Act, 2019 whereby threshold for TDS on payment of interest by a banking company or cooperative society or public company was raised to forty thousand rupees. These amendments will take effect from 1st September, 2019. [Clause 50] G. STRENGTHENING ANTI-ABUSE MEASURES Tax on income distributed to shareholder in case of listed companies Section 115QA of the Act provides for the levy of additional Income-tax at the rate of twenty per cent. of the distributed income on account of buy-back of unlisted shares by the company. As additional income-tax has been levied at the level of company, the consequential income arising in the hands of shareholders has been exempted from tax under clause (34A) of section 10 of the Act. This section was introduced as an anti-abuse provision to check the practice of unlisted compani....
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....e-tax Act, so as to provide that,- (i) at the time of granting the registration to a trust or institution, the Principal Commissioner or the Commissioner shall, inter alia, also satisfy himself about the compliance of the trust or institution to requirements of any other law which is material for the purpose of achieving its objects; (ii) where a trust or an institution has been granted registration under clause (b) of sub-section (1) or has obtained registration at any time under section 12A and subsequently it is noticed that the trust or institution has violated requirements of any other law which was material for the purpose of achieving its objects, and the order, direction or decree, by whatever name called, holding that such violation has occurred, has either not been disputed or has attained finality, the Principal Commissioner or Commissioner may, by an order in writing, cancel the registration of such trust or institution after affording a reasonable opportunity of being heard. These amendments shall be effective from 1st September, 2019. [Clause 7] H. REMOVING DIFFICULTIES FACED BY TAX PAYERS Facilitating demerger of Ind-AS compliant c....
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....or. To remove this anomaly, it is proposed to amend the proviso to sub-section (1) of section 201 to extend the benefit of this proviso to a deductor, even in respect of failure to deduct tax on payment to non-resident. Consequent to this amendment, it is also proposed to amend the proviso to sub-section (1A) of section 201 to provide for levy of interest till the date of filing of return by the non-resident payee (as is the case at present with resident payee). These amendments will take effect from 1st September, 2019. [Clause 49] For the same reason, it is also proposed to amend clause (a) of section 40 to provide that where an assessee fails to deduct tax in accordance with the provisions of Chapter XVII-B on any sum paid to a non-resident, but is not deemed to be an assessee in default under the first proviso to sub-section (1) of section 201, then it shall be deemed that the assessee has deducted and paid the tax on such sum on the date of furnishing of the return of income by the payee referred to in that proviso. Thus, there will be no disallowance under section 40 in respect of such payments. This amendment will take effect from 1st April, 2020 and wil....
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....1st September, 2019. [Clause 29] Clarification with regard to provisions of secondary adjustment and giving an option to assessee to make one-time payment In order to align the transfer pricing provisions with international best practices, section 92CE of the Act provides for secondary adjustments in certain cases. It, inter alia, provides that the assessee shall be required to carry out secondary adjustment where the primary adjustment to transfer price, has been made suo motu, or made by the Assessing Officer and accepted by him; or is determined by an advance pricing agreement entered into by him under section 92CC of the Act; or is made as per safe harbour rules prescribed under section 92CB of the Act; or is arising as a result of resolution of an assessment through mutual agreement procedure under an agreement entered into under section 90 or 90A of the Act. The proviso to said sub-section provides exemption in cases where the amount of primary adjustment made in any previous year does not exceed one crore rupees; and the primary adjustment is made in respect of an assessment year commencing on or before 1st April, 2016. Several concerns have been expr....
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....has provided concessional rate of long-term capital gains tax under section 112A of the Act for the transfer of units of such fund of funds. In order to further incentivise these funds of funds, it is proposed to amend section 111A so as to extend the concessional rate of tax for short-term capital gains in respect of transfer of units of such fund of funds. This amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to assessment year 2020-21 and subsequent assessment years. [Clause 32] Provide for pass through of losses in cases of Category I and Category II Alternative Investment Fund (AIF) Section 115UB of the Act, inter alia, provides for pass through of income earned by the Category I and II AIF, except for business income which is taxed at AIF level. Pass through of profits (other than profit & gains from business) has been allowed to individual investors so as to give them benefit of lower rate of tax, if applicable. Pass through of losses are not provided under the existing regime and are retained at AIF level to be carried forward and set off in accordance with Chapter VI. In order to remove the genuine difficulty ....
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....ation to the assessment year 2007-08 and subsequent assessment years. [Clauses 42, 43, 52, 53, & 54] TDS on non exempt portion of life insurance pay-out on net basis. Under section 194DA of the Act, a person is obliged to deduct tax at source, if it pays any sum to a resident under a life insurance policy, which is not exempt under sub-section (10D) of section 10. The present requirement is to deduct tax at the rate of one per cent. of such sum at the time of payment. Several concerns have been expressed that deducting tax on gross amount creates difficulties to an assesse who otherwise has to pay tax on net income (i.e after deducting the amount of insurance premium paid by him from the total sum received). From the point of views of tax administration as well, it is preferable to deduct tax on net income so that the income as per TDS return of the deductor can be matched automatically with the return of income filed by the assessee. The person who is paying a sum to a resident under a life insurance policy is aware of the amount of insurance premium paid by the assessee. Hence, it is proposed to provide for tax deduction at source at the rate of five per cent. on i....
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....all keep and maintain the prescribed information and document in respect thereof. Proviso to said section inserted through the Finance Act, 2016 provides that the person, being a constituent entity of an international group, shall also keep and maintain such information and document in respect of an international group as may be prescribed. Accordingly, Rule 10DA, prescribed for this purpose, provides the requisite information to be furnished in prescribed form, subject to the thresholds of the consolidated group revenue and the international transaction. It is proposed to substitute section 92D of the Act, in order to provide that the information and document to be kept and maintained by a constituent entity of an international group, and filing of required form, shall be applicable even when there is no international transaction undertaken by such constituent entity. It is also proposed to provide that information shall be furnished by the constituent entity of an international group to the prescribed authority. This amendment will take effect from the 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-21 and subsequent assessment yea....
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....rting of income and quantum of penalty to be levied in the case where the person has under-reported income and furnished the return of income for the first time under section 148 of the Act. In order to provide for manner of computing the quantum of penalty in a case where the person has under-reported income and furnished his return for the first time under section 148, it is proposed to suitably amend the provisions of section 270A. These amendments will take effect retrospectively from 1st April, 2017 and will, accordingly, apply in relation to assessment year 2017-2018 and subsequent assessment years. [Clause 61] Rationalisation of the provisions of section 276CC The existing provisions of section 276CC of the Act, inter alia, provide that prosecution proceedings for failure to furnish returns of income against a person shall not proceeded against, for failure to furnish the return of income in due time, if the tax payable by such person, not being a company, on the total income determined on regular assessment does not exceed three thousand rupees. The existing provisions do not provide for taking into account tax collected at source and self-assessment tax for ....
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....e Act shall be made in the prescribed form and verified in the prescribed manner. In order to simplify the procedure for claim of refund, it is proposed to amend the said section so as to provide that every claim for refund under Chapter XIX of the Act shall be made by furnishing return in accordance with the provisions of section 139 of the Act. This amendment will take effect from 1st September, 2019. [Clause 55] Enhancing time limitation for sale of attached property under rule 68B of the Second Schedule of the Act The existing provisions of rule 68B of the Second Schedule of the Act provide that no sale of immovable property attached towards the recovery of tax, penalty etc. shall be made after the expiry of three years from the end of the financial year in which the order in consequence of which any tax, penalty etc. becomes final. In order to protect the interest of the revenue, especially in those cases where demand has been crystallised on conclusion of the proceedings, it is proposed to amend the aforesaid sub-rule so as to extend the period of limitation from three years to seven years In order to ensure that the limitation of time period for sale of ....
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....f section 144A of the Income-tax Act shall be applicable to the BM Act with necessary modifications. [Clause 198] Further, a clarificatory amendment is also proposed to be made in section 17 of the BM Act to clarify that the Commissioner (Appeals) may also vary the penalty order so as to enhance or reduce the penalty. This amendment will take effect from 1st September, 2019. [Clause 197] Rationalisation of the Income Declaration Scheme, 2016 The existing provisions of section 187 of the Finance Act, 2016 provide, inter alia, that the tax, surcharge and penalty in respect of the undisclosed income, declared under the Income Declaration Scheme, 2016 (the Scheme) shall be paid on or before a notified due date. In order to address genuine concern of the declarants, it is proposed to amend the said section so as to provide that where the amount of tax, surcharge and penalty, has not been paid within the due date, the Central Government may notify the class of persons who may make the payment of such amount on or before a notified date, along with the interest on such amount, at the rate of one per cent of every month or part of a month, comprised in the period....
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....des for attachment of property for a period of ninety days from the date of issue of notice under section 24(1) of the PBPT Act. Section 24(4) provides for passing of order within ninety days from the date of issuing notice under section 24(1). In order to rationalize the aforesaid provisions, it is proposed to amend the section 24 so as to provide that the period of ninety days in respect of provisional attachment of the property under section 24(3) and passing of order under section 24(4) shall be reckoned from the end of the month in which the notice under section 24(1) is issued. This amendment will take effect from 1st day of September, 2019. [Clause 173] The existing provisions of section 24(4) of the PBPT Act provide for passing of order by the Initiating Officer, of section 24(5) provide for making of reference by the Initiating Officer and of section 26(7) provide for passing of order by the Adjudicating Authority. However, no exclusion is provided for the period during which the proceedings are stayed by the Court. In order to provide for the exclusion and adequate time to pass the order or make the reference, it is proposed to suitably amend the provisions of....
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.... Note: (a) "Basic Customs Duty" means the customs duty levied under the Customs Act, 1962. (b) "Export duty" means duty of Customs leviable on goods specified in the Second Schedule to the Customs Tariff Act, 1975. (c) "Road and Infrastructure Cess" means the additional duty of customs levied under section 111 of the Finance Act, 2018. (d) Clause nos. in square brackets [ ] indicate the relevant clause of the Finance (No. 2) Bill, 2019. (e) Amendments carried out through the Finance (No. 2) Bill, 2019 will come into effect on the date of its enactment, unless otherwise specified. I. AMENDMENTS IN THE CUSTOMS ACT, 1962: S. No. Amendment Clause of the Finance (No.2) Bill, 2019 1 Section 41 is being amended so as to provide a facility, that the departure manifest can also be furnished to a person notified by the Central Government, in addition to the person-in- charge of the conveyance. [69] 2 A new chapter XIIB titled "Verification of Identity and Compliance" is being inserted. New section 99B introduced under this chapter empowers proper officer of Customs to carry out ve....
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.... the proper officer to provisionally attach any bank account for safeguarding the government revenue and prevention of smuggling, for a period not exceeding six months. It is also being provided that a Principal Commissioner of Customs or Commissioner of Customs may further extend the period of attachment up to six months. [73] 6 Section 110A is being amended so as to empower an adjudicating authority to release bank account provisionally attached under section 110 to the accountholder on fulfilment of certain conditions. [74] 7 A new section 114AB is being inserted so as to provide that any person who has obtained any instrument by fraud, collusion, wilful misstatement or suppression of facts and such instrument has been utilized by such person or any other person for discharging duty, such person to whom the instrument was issued shall be liable for penalty not exceeding the face value of such instrument. An Explanation to define the term instrument is also being inserted. [75] 8 Section 117 is being amended so as to increase the maximum limit of penalty from one lakh rupees to four lakh rupees. [76] 9 First proviso to section 125 i....
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.... Construction Materials 1 3918 Floor covering of plastics, Wall or ceiling coverings of plastics 10% 15% 2 6905, 6907 Ceramic roofing tiles and ceramic flags and pavings, hearth or wall tiles 10% 15% 3 8302 Base metal fittings, mountings and similar articles suitable for furniture, doors, staircases, windows, blinds, hinge for auto mobiles 10% 15% Precious Metals 4 7106 Silver (including silver plated with gold or platinum) unwrought or in semimanufactured forms, or in powdered form 10% 12.5% 5 7107 00 00 Base metals clad with silver, not further worked than semi-manufactured 10% 12.5% 6 7108 Gold (including gold plated with platinum) unwrought or in semimanufactured forms, or in powder form 10% 12.5% 7 7109 00 00 Base metals or silver, clad with gold, not further worked than semimanufactured 10% 12.5% 8 7110 Platinum, unwrought or in semi-manufactured form, or in powder form 10% 12.5% 9 7111 00 00 Base metals, silver or gold, cl....
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....DVR) and Network Video Recorder (NVR) 15% 20% 27 8525 80 CCTV camera and IP camera 15% 20% 28 9001 10 00 Optical Fibres, optical fibre bundles and cables 10% 15% Miscellaneous changes in Tariff Schedule 29 9804 Chapter Note 7 to be inserted in Chapter 98 so as to exclude printed books imported for personal use from the purview of heading 9804. This heading covers all dutiable articles imported for personal use and attracts 28% IGST. This amendment would exclude printed books from this heading and they would be subject to the applicable merit rate. B. Amendments not affecting rates of duty [Clause 87(b) of the Finance (No. 2) Bill, 2019] 30 First Schedule to the Customs Tariff Act, 1975 is amended to: (i) Create specific tariff lines for specific products, presently classified as others; (ii) Rectify the errors to align it with HSN. These changes would come into effect from a date to be notified by the Central Government in the official gazette. * Will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931. IV. OTHER ....
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.... 12 2910 20 00 Methyloxirane (Propylene Oxide) 7.5% 5% 13 Plastic and Rubber 14 3904 Poly Vinyl Chloride 7.5% 10% 15 3926 90 91, 3926 90 99 Articles of plastics 10% 15% 16 4002 31 00 All goods i.e. Butyl Rubber 5% 10% 17 4002 39 00 Chlorobutyl rubber or bromobutyl rubber 5% 10% Paper and Paper products 18 48 a. Newsprint Nil 10% b.Uncoated paper used for printing of newspapers c.Lightweight coated paper used for printing of magazines 19 4901 10 10, 4901 91 00, 4901 99 00 Printed books (including covers for printed books) and printed manuals, in bound form or in loose-leaf form with binder, executed on paper or any other material including transparencies. Nil 5% Textiles 20 5101 Wool Fibre 5% 2.5% 21 5105 Wool Tops 5% 2.5% Flooring materials 22 2515 1....
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.... (vii)Compact Camera Module Applicable rate Nil 36 84, 85 or 90 Capital goods used for manufacturing of specified electronic items, namely- (i)Cathode Ray tubes; (ii)CD/CD-R/DVD/DVD-R; (iii)Deflection components, CRT monitors/CTVs; (iv)Plasma Display Panel Nil Applicable Electronics 37 8504 40 Charger/Power adapter for CCTV camera/IP camera/DVR/NVR Nil 15% 38 85 Specified electronic items like plugs, sockets, switches, connectors, relays. Nil Applicable rate Automobile and automobile parts 39 8421 39 20, 8421 39 90 Catalytic convertor (All goods under these tariff items other than catalytic converters will continue at 7.5%) 5% 10% 40 8702, 8704 Completely Built Unit (CBU) of vehicles falling under heading 8702, 8704 25% 30% 41 Any Chapter (i)E-Drive assembly, (ii)On board charger, (iii)E-compressor and (iv)Charging Gun Following parts of electric vehicles: - Applicable rate Nil 42 87 Prescribing actual user condition in ....
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....ol and Diesel From To 1 Motor spirit commonly known as petrol Rs. 8 per litre Rs. 9 per litre 2 High speed diesel oil Rs. 8 per litre Rs. 9 per litre VIII. RETROSPECTIVE AMENDMENTS OF RATE NOTIFICATIONS S. No. Amendment Clause of the Finance (No. 2) Bill, 2019 1 (i) Notification Nos. 46/2011-Customs, dated 01.06.2011, 53/2011-Customs, dated 01.07.2011, 12/2012-Customs dated 17.03.2012 are proposed to be amended retrospectively to insert correct CTH of Stearic Acid in the notifications with effect from 31.03.2017. (ii)Notification No. 50/2017-Customs dated 30.06.2017 is also proposed to be amended retrospectively to insert correct CTH of Stearic Acid in the notifications with effect from 01.07.2017. [82] [83] 2 Notification No. 86/2018-Customs dated 31st December, 2018 amending notification No. 296/76-Customs dated 2nd August, 1976 is proposed to be given retrospective effect so as to exempt IGST and compensation cess leviable under section 3(7) and section 3(9) of the Customs Tariff Act, 1975 respectively, on the temporary importation of vehicles under the Customs ....
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.... Finance (No. 2) Bill, 2019. (e) Amendments carried out through the Finance (No. 2) Bill, 2019 come into effect on the date of its enactment, unless otherwise specified. I. AMENDMENTS IN THE FOURTH SCHEDULE TO THE CENTRAL EXCISE ACT, 1944 S. No. Amendments affecting rate of Basic Excise Duty [to be effective from 06.07.2019]* [Clause [90] of the Finance (No. 2) Bill, 2019] Rate of Duty S. No. Heading, sub-heading tariff item Commodity From To 1 2709 20 00 Petroleum Crude Nil Re. 1 per tonne * Will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931. II. PROPOSALS INVOLVING CHANGE IN EXCISE DUTY RATES THROUGH NOTIFICATIONS: S. No. Heading, sub-heading tariff item Commodity From To 1 2402 20 10 Other than filter cigarettes, of length not exceeding 65 millimeters Nil Rs. 5 per thousand 2 2402 20 20 Other than filter cigarettes, of length exceeding 65 millimeters but not exceed....
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....esel [to be effective from 06.07.2019]* [Clause [185] of the Finance (No. 2) Bill, 2019][effective rate is prescribed by notification as detailed in V-A below] Rate of Duty From To 1 Motor spirit commonly known as petrol Rs. 7 per litre Rs. 10 per litre 2 High speed diesel oil Rs. 1 per litre Rs. 4 per litre * Will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931. IV. AMENDMENT IN THE SIXTH SCHEDULE TO THE FINANCE ACT, 2018: S. No. Amendments in scheduled rate of Road and Infrastructure cess levied as additional duty of excise, on Petrol and Diesel [to be effective from 06.07.2019]* [Clause [201] of the Finance (No. 2) Bill, 2019] [effective rate is prescribed by notification as detailed in V-B below] Rate of Duty From To 1 Motor spirit commonly known as petrol Rs. 8 per litre Rs. 10 per litre 2 High speed diesel oil Rs. 8 per litre Rs. 10 per litre *Will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931. V. Effective change in....
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....ots for development of infrastructure for financial business, provided or agreed to be provided by the State Government Industrial Development Corporations or Undertakings or by any other entity having 50% or more ownership of Central Government, State Government, Union Territory to the developers in any industrial or financial business area, is proposed to be exempted from Service Tax for the period commencing from the 1st October, 2013 and ending with the 30th June, 2017. [118] Sabka Vishwas Legacy Dispute Resolution Scheme S. No. Details of the proposal Clause of Finance (No.2) Bill, 2019 1 A dispute resolution cum amnesty scheme called the Sabka Vishwas Legacy Dispute Resolution Scheme is being introduced for resolution and settlement of legacy cases of Central Excise and Service Tax [119-134] Goods and Services Tax Note: (a) CGST Act means Central Goods and Services Tax Act, 2017 (b) IGST Act means Integrated Goods and Services Tax Act, 2017 (c) UTGST Act means Union Territory Goods and Services Tax Act, 2017 (d) Amendments carried out through the Finance (No. 2) Bill, 2019 come into effect on the date of its enactment....
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.... A new section 31A is being inserted in the CGST Act so that specified suppliers shall have to mandatorily give the option of specified modes of electronic payment to their recipients. [95] 6 Section 39 of the CGST Act is being amended so as to allow the composition taxpayers to furnish annual return along with quarterly payment of taxes; and other specified taxpayers may be given the option for quarterly or monthly furnishing of returns and payment of taxes under the proposed new return system. [96] 7 New provisos are being inserted in sub-section (1) of section 44 of the CGST Act so as to empower the Commissioner to extend the due date for furnishing Annual return (prescribed FORM GSTR-9/9A) and reconciliation statement (prescribed FORM GSTR-9C). [97] 8 New sub-sections are being inserted in section 49 of the CGST Act to provide a facility to the registered person to transfer an amount from one (major or minor) head to another (major or minor) head in the electronic cash ledger. [98] 9 New proviso in sub-sections (1) is being inserted in section 50 of the CGST Act so as to provide for charging interest only on the net cash t....
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.... in respect of the said applicants and the registered persons having the same Permanent Account Number. [106] 17 Section 104 of the CGST Act is being amended so as to provide that advance ruling pronounced by the National Appellate Authority shall be void where the ruling has been obtained by fraud or suppression of material facts or misrepresentation of facts. [107] 18 Section 105 of the CGST Act is being amended so as to provide that the National Appellate Authority shall have all the powers of a civil court under the Code of Civil Procedure, 1908 for the purpose of exercising its powers under the Act. [108] 19 Section 106 of the CGST Act is being amended so as to provide that the National Appellate Authority shall have power to regulate its own procedure. [109] 20 Consequent to the amendments in section 44 and section 52 of the CGST Act, section 168 is being amended so as to specify that in respect of sub-section (1) of section 44 and subsections (4) and (5) of section 52, Commissioner or Joint Secretary shall exercise the powers specified in the said sections with the approval of the Board. [110] 21 Section 17....