TaxTMI 
TaxTMI 
Notes on Clauses
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....ny payment by a company on purchase of its own shares from a shareholder in accordance with the provisions of section 68 of the Companies Act, 2013. These amendments will take effect from 1st October, 2024. Clause (42A) of the said section provides that "short-term capital asset" means a capital asset held by an assessee for not more than thirty-six months immediately preceding the date of its transfer, provided that in the case of a security (other than a unit) listed in a recognized stock exchange in India or a unit of the Unit Trust of India established under the Unit Trust of India Act, 1963 (52 of 1963) or a unit of an equity oriented fund or a zero coupon bond or in case of a share of a company (not being a share listed in a recognised stock exchange) or a unit of a Mutual Fund specified under clause (23D) of section 10, which is transferred during the period beginning on the 1st day of April, 2014 and ending on the 10th day of July, 2014, the period of holding for the purposes of this clause would be twelve months. The clause also provides that in the case of a share of a company, not being a share listed in a recognised stock exchange in India, or an immovable property, b....
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....sed to the said clause provides the meaning of the expressions "specified company", "holding company" and "subsidiary company". These amendments will take effect from 1st April, 2025 and will, accordingly, apply in relation to the assessment year 2025-2026 and subsequent years. Clause (23C) of said section provides exemption to the income of certain entities. Sub-clauses (iv), (v), (vi) and (via) of clause (23C) of the said section provide exemption to the income received by any person on behalf of any fund or trust or institution or university or other educational institutions or hospital or other institutions which may be approved or provisionally approved by the Principal Commissioner or Commissioner. First proviso to clause (23C), inter alia, provides that exemption to the fund or trust or institution or university or other educational institution or hospital or other medical institution referred to in sub-clause (iv) or sub-clause (v) or sub-clause (vi) or sub-clause (via), under the respective sub-clauses, shall not be available to it unless such fund or trust or institution or university or other educational institution or hospital or other medical institution makes an a....
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....come of a previous year. It is also proposed to amend item (II) of sub-clause (A) of clause (b) of the Explanation to the said clause (23FB) to expand the scope of venture capital fund to include the venture capital fund referred to in sub-regulation (2) of regulation 18 of the International Financial Services Centres Authority (Fund Management) Regulations, 2022 made under the International Financial Services Centres Authority Act, 2019. It is also proposed to insert sub-item (iv) in the said item (II) to provide for any other condition as may be provided by rules. These amendments will take effect from 1st April, 2025 and will, accordingly, apply in relation to the assessment year 2025-2026 and subsequent years. Clause (34) of the said section provides exemption to any income arising to an assessee, being a shareholder, on account of buy back of shares by the company as referred to in section 115QA. It is also proposed to insert a new proviso to clause (34) of the said section so as to provide that this clause shall not apply with respect to any buy back of shares by a company on or after the 1st day of October, 2024. This amendment will take effect from 1st October, 2024. ....
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....ay of April of the previous year relevant to the assessment year for which the exemption is claimed under clause (46B) of section 10. Second proviso to sub-section (7) of the said section provides that the trust or institution, whose registration has become inoperative under the first proviso, may apply to get its registration operative under section 12AA or section 12AB subject to the condition that on doing so, the approval under clause (23C) of section 10 or notification under clause (23EC) or clause (46) or clause (46A) of section 10, as the case may be, to such trust or institution shall cease to have any effect from the date on which the said registration becomes operative and thereafter, it shall not be entitled to exemption under the respective clauses. It is proposed to amend the said second proviso so as to provide that the trust or institution, whose registration has become inoperative under the first proviso, may apply to get its registration operative under section 12AA or section 12AB subject to the condition that on doing so, the approval under clause (23C) of section 10 or notification under clause (23EA) or clause (23EC) or clause (23ED) or clause (46) or clause ....
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....f he considers that there is a reasonable cause for delay in filing the application, condone such delay and such application shall be deemed to have been filed within time. These amendments will take effect from 1st October, 2024. Clause 7 of the Bill seeks to amend section 12AB of the Income-tax Act relating to procedure for fresh registration. Sub-section (3) of the said section provides that the order under clause (a), sub-clause (ii) of clause (b) and clause (c), of sub-section (1) shall be passed, in such form and manner as may be provided by rules, before expiry of the period of three months, six months and one month, respectively, calculated from the end of the month in which the application was received. It is proposed to amend sub-section (3) of the said section so as to provide that the order under sub-clause (ii) of clause (b) of sub-section (1) shall be passed, in such form and manner as may be provided by rules, before expiry of the period of six months from the end of the quarter in which the application was received. This amendment will take effect from 1st October, 2024. Clause 8 of the Bill seeks to insert a new section 12AC of the Income-tax Act relating to ....
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....that in a case where income-tax is computed under clause (ii) of sub-section (1A) of section 115BAC, the provisions of clause (ia) of section 16 shall have effect as if for the words "fifty thousand rupees", the words "seventy-five thousand rupees" had been substituted. This amendment will take effect from 1st April, 2025, and will accordingly apply to assessment year 2025-2026 and subsequent years. Clause 11 of the Bill seeks to amend section 28 of the Income-tax Act relating to profits and gains of business or profession. The said section provides various types of income that shall be chargeable to income-tax under the head "Profits and gains of business or profession". It is proposed to amend the said section and insert a new Explanation so as to provide that any income from letting out of a residential house or a part of the house by the owner, shall not be chargeable under the head "Profits and gains of business or profession" and shall be chargeable to tax under the head "Income from house property". This amendment will take effect from 1st April, 2025 and will, accordingly, apply in relation to the assessment year 2025-2026 and subsequent years. Clause 12 of the Bill s....
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....o amounts not deductible. Sub-clause (v) of clause (b) of the said section provides for disallowance of remuneration paid to any working partner above certain threshold limits. It is proposed to amend item (a) of sub-clause (v) of clause (b) of the said section 40 so as to increase the limit of remuneration to working partners, which is allowable as deduction such that on the first Rs 6,00,000 of the book-profit or in case of a loss, the limit of remuneration is increased to Rs 3,00,000 or at the rate of 90 per cent. of the book-profit, whichever is more. This amendment will take effect from 1st April, 2025 and will, accordingly, apply in relation to the assessment year 2025-2026 and subsequent years. Clause 15 of the Bill seeks to amend section 43D of the Income-tax Act relating to special provision in case of income of public financial institutions, public companies, etc. The said section provides that the income by way of interest credited in relation to certain categories of bad or doubtful debts shall be chargeable to tax in the previous year in which it is credited to the profit and loss account or, as the case may be, in which it is actually received, whichever is earli....
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....e said section further proposes to provide that the amounts referred to in sub-section (1) shall be the following, namely:-- (i) the amount paid or payable to the assessee or to any person on his behalf on account of the carriage of passengers; and (ii) the amount received or deemed to be received by or on behalf of the assessee on account of the carriage of passengers. These amendments will take effect from 1st April, 2025 and will, accordingly, apply in relation to the assessment year 2025-2026 and subsequent years. Clause 18 of the Bill seeks to amend section 46A of the Income-tax Act relating to capital gains on purchase by company of its own shares or other specified securities. The said section provides that where a shareholder or a holder of other specified securities receives any consideration from any company for purchase of its own shares or other specified securities held by such shareholder or holder of other specified securities, then, subject to the provisions of section 48, the difference between the cost of acquisition and the value of consideration received by the shareholder or the holder of other specified securities, as the case may be, shall be deemed to....
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....term capital asset, other than capital gain arising to a non-resident from the transfer of shares in, or debentures of, an Indian company referred to in the first proviso. This amendment will take effect retrospectively from 23rd July, 2024. Clause 21 of the Bill seeks to amend section 50AA of the Income-tax Act relating to Special provision for computation of capital gains in case of Market Linked Debenture. It is proposed to substitute the opening portion of the said section so as to provide that notwithstanding anything contained in clause (42A) of section 2 or section 48, where the capital asset-- (a) is a unit of a Specified Mutual Fund acquired on or after the 1st day of April, 2023 or a Market Linked Debenture; or (b) is an unlisted bond or an unlisted debenture which is transferred or redeemed or matures on or after the 23rd day of July, 2024; the full value of consideration received or accruing as a result of the transfer or redemption or maturity of such debenture or unit or bond as reduced by-- (i) the cost of acquisition of the debenture or unit or bond; and (ii) the expenditure incurred wholly and exclusively in connection with such transfer or redemption o....
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.... is proposed to insert item (AA) in the said sub-clause to provide that in a case where the capital asset is an equity share in a company which is not listed on a recognised stock exchange as on the 31st day of January, 2018, or which became the property of the assessee in consideration of share which is not listed on such exchange as on the 31st day of January, 2018 by way of transaction not regarded as transfer under section 47, as the case may be, but listed on such exchange subsequent to the date of transfer, where such transfer is in respect of sale of unlisted equity shares under an offer for sale to the public included in an initial public offer, "fair market value" would mean an amount which bears to the cost of acquisition the same proportion as Cost Inflation Index for the financial year 2017-2018 bears to the Cost Inflation Index for the first year in which the asset was held by the assessee or for the year beginning on the first day of April, 2001, whichever is later. This amendment will take effect retrospectively from 1st April, 2018 and will, accordingly, apply in relation to the assessment year 2018-2019 and subsequent years. Clause 23 of the Bill seeks to amend s....
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....aid clause so as to provide that in a case where income-tax is computed under clause (ii) of sub-section (1A) of section 115BAC of the Act, the provisions of clause (iia) of section 57 shall have effect as if for the words "fifteen thousand rupees", the words "twenty-five thousand rupees" had been substituted. This amendment will take effect from 1st April, 2025, and will accordingly apply to assessment year 2025-2026 and subsequent years. Clause 25 of the Bill seeks to amend section 80CCD of the Income-tax Act relating to deduction in respect of contribution to pension scheme of Central Government. Sub-section (2) of the said section provides that any contribution by the Central Government or the State Government or any other employer to the account of an assessee referred to in sub-section (1), shall be allowed as a deduction to the assessee in the computation of their total income, if it does not exceed fourteen per cent. of their salary in previous year, where such contribution is made by the Central Government or the State Government and ten per cent. of salary in previous year where such contribution is made by any other employer. It is proposed to insert a proviso to sub....
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....(5) of the said section, inter alia, provides that the Principal Commissioner or Commissioner, on receipt of an application made under the first proviso, shall where the application is made under clause (ii) or clause (iii) or sub-clause (B) of clause (iv) of the first proviso, after satisfying himself about the genuineness of activities and the fulfilment of all the conditions if he is not so satisfied, pass an order in writing, in this manner specified therein after affording it a reasonable opportunity of being heard. It is also proposed to amend item (B) of sub-clause (b) of clause (ii) of second proviso to the said sub-section (5) to provide that if the Principal Commissioner or Commissioner is not so satisfied, shall pass an order in writing, rejecting such application and cancelling its approval, if any, after affording it a reasonable opportunity of being heard. Third proviso to sub-section (5) of the said section provide that the order under clause (i), sub-clause (b) of clause (ii) and clause (iii) of the second proviso to the said sub-section (5) shall be passed in such form and manner as may be provided by rules, before expiry of the period of three months, six months....
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....nt establishment of a foreign company which is engaged in the business of banking or insurance or such class of non-banking financial companies as may be notified by the Central Government in the Official Gazette in this behalf. It is proposed to amend the said sub-section so as to include reference of a Finance Company located in any International Financial Services Centre. It is further proposed to amend sub-section (5) of the said section to provide the meaning of expressions "Finance Company" and "International Financial Services Centre" These amendments will take effect from 1st April, 2025 and will, accordingly, apply in relation to the assessment year 2025-2026 and subsequent years. Clause 29 of the Bill seeks to amend section 111A of the Income-tax Act relating to tax on short-term capital gains in certain cases. The said section, inter alia, provides that where the total income of an assessee includes any income chargeable under the head "Capital gains", arising from the transfer of a short-term capital asset, being an equity share in a company or a unit of an equity oriented fund or a unit of a business trust and-- (a) the transaction of sale of such equi....
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....ection provides that where the total income of an assessee includes any income, arising from the transfer of a long-term capital asset, which is chargeable under the head "Capital gains", the tax payable by the assessee on the total income shall be the aggregate of,-- (a) in the case of an individual or a Hindu undivided family, being a resident,-- (i) the amount of income-tax payable on the total income as reduced by the amount of such long-term capital gains, had the total income as so reduced been his total income; and (ii) the amount of income-tax calculated on such long-term capital gains at the rate of twenty per cent.: Provided that where the total income as reduced by such long-term capital gains is below the maximum amount which is not chargeable to income-tax, then, such long-term capital gains shall be reduced by the amount by which the total income as so reduced falls short of the maximum amount which is not chargeable to income-tax and the tax on the balance of such long-term capital gains shall be computed at the rate of twenty per cent.; (b) in the case of a domestic company,-- (i) the amount of income-tax payable on the total income as reduced by the amou....
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....s total income; and (ii) the amount of income-tax calculated on such long-term capital gains,-- (A) at the rate of twenty per cent. for any transfer which takes place before the 23rd day of July, 2024; and (B) at the rate of twelve and one-half per cent. for any transfer which takes place on or after the 23rd day of July, 2024: Provided that where the total income as reduced by such long-term capital gains is below the maximum amount which is not chargeable to income-tax, then, such long-term capital gains shall be reduced by the amount by which the total income as so reduced falls short of the maximum amount which is not chargeable to income-tax and the tax on the balance of such long-term capital gains shall be computed at the rate as applicable in sub-clause (ii); (b) in the case of a domestic company,-- (i) the amount of income-tax payable on the total income as reduced by the amount of such long-term capital gains, had the total income as so reduced been its total income; and (ii) the amount of income-tax calculated on such long-term capital gains (A) at the rate of twenty per cent. for any transfer which takes place before the 23rd day of July, 2024; and (B)....
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....ection (2) of said section, inter alia, provide that the tax payable by the assessee on the total income referred to in sub-section (1) of the section shall be the aggregate of-- (i) the amount of income-tax calculated on such long-term capital gains exceeding one lakh rupees at the rate of ten per cent.; and (ii) the amount of income-tax payable on the total income as reduced by the amount of long-term capital gains referred to in sub-section (1) as if the total income so reduced were the total income of the assessee. It is proposed to substitute clause (i) of the said sub-section, inter alia, so as to provide that the tax payable by the assessee on the total income referred to in sub-section (1) of the section shall be the aggregate of-- (i) the amount of income-tax calculated on such long-term capital gains exceeding one lakh twenty-five thousand rupees- (a) on long-term capital gains at the rate of ten per cent. for any transfer which takes place before the 23rd day of July, 2024; and (b) on long-term capital gains, at the rate of twelve and one-half per cent. for any transfer which takes place on or after the 23rd day of July, 2024; Provided that the limit of one ....
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....ising from their transfer. The sub-section (1) of said section provides that where the total income of an assessee, being a non-resident, includes-- (a) income by way of interest on bonds of an Indian company issued in accordance with such scheme as the Central Government may, by notification in the Official Gazette, specify in this behalf, or on bonds of a public sector company sold by the Government, and purchased by him in foreign currency; or (b) income by way of dividends on Global Depository Receipts-- (i) issued in accordance with such scheme as the Central Government may, by notification in the Official Gazette, specify in this behalf, against the initial issue of shares of an Indian company and purchased by him in foreign currency through an approved intermediary; or (ii) issued against the shares of a public sector company sold by the Government and purchased by him in foreign currency through an approved intermediary; or (iii) issued or re-issued in accordance with such scheme as the Central Government may, by notification in the Official Gazette, specify in this behalf, against the existing shares of an Indian company purchased by him in foreign currency thro....
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....e by way of long-term capital gains arising from the transfer of Global Depository Receipts referred to in clause (a), the income-tax payable shall be the aggregate of-- (i) the amount of income-tax calculated on the income by way of dividends in respect of Global Depository Receipts referred to in clause (a), if any, included in the total income, at the rate of ten per cent.; (ii) the amount of income-tax calculated on the income by way of long-term capital gains referred to in clause (b), if any, at the rate of ten per cent.; and (iii) the amount of income-tax with which the resident employee would have been chargeable had his total income been reduced by the amount of income referred to in clauses (a) and (b). It is proposed to substitute clause (ii) of longline of said sub-section so as to provide that the amount of income-tax calculated on the income by way of long-term capital gains referred to in clause (b), if any, included in the total income, shall be at the rate of ten per cent. for any transfer which takes place before the 23rd day of July, 2024, and at the rate of twelve and one-half per cent. for any transfer which takes place on or after the 23rd day of July,....
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....hall apply on aggregate of the long-term capital gains referred to in clause (a) and (b). These amendments will take effect retrospectively from 23rd July, 2024. Clause 37 of the Bill seeks to amend section 115BAC of the Income-tax Act relating to tax on income of individuals and Hindu undivided family. It is proposed to amend sub-section (1A) of the said section to provide that notwithstanding anything contained in this Act but subject to the provisions of Chapter XII, the income-tax payable in respect of the total income of a person, being an individual or Hindu undivided family or association of persons (other than a co-operative society), or body of individuals, whether incorporated or not, or an artificial juridical person referred to in sub-clause (vii) of clause (31) of section 2, other than a person who has exercised an option under sub-section (6),-- (i) for any previous year relevant to the assessment year beginning on the 1st day of April, 2024, shall be computed at the rate of tax given in the following Table, namely:-- TABLE Sl. No. Total income Rate of tax (1) (2) (3) 1. Upto Rs. 3,00,000 Nil 2. From Rs. 3,00,001 to Rs. 6,00,000 5 per cent. 3. From....
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....d July, 2024. Clause 39 of the Bill seeks to amend section 115QA of the Income-tax Act relating to tax on distributed income to shareholders. Sub-section (1) of the said section, inter alia, provides that notwithstanding anything contained in any other provision of this Act, in addition to the income-tax chargeable in respect of the total income of a domestic company for any assessment year, any amount of distributed income by the company on buy-back of shares from a shareholder shall be charged to tax and such company shall be liable to pay additional income-tax at the rate of twenty per cent on the distributed income. It is proposed to insert a new proviso to the said sub-section so as to provide that the provisions of the said sub-section shall not apply in respect of any buy-back of shares, that takes place on or after the 1st day of October, 2024. This amendment will take effect from 1st October, 2024. Clause 40 of the Bill seeks to amend section 132B of the Income-tax Act relating to application of seized or requisitioned assets. The said section provides that the amount of any existing liability under the Income-tax Act, the Wealth-tax Act, 1957, the Expenditure-tax Ac....
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....in the return of income furnished by him. It is proposed to amend the said sub-section (1) so as to insert a second proviso providing that the first proviso shall not apply in respect of any application form for allotment of permanent account number or return of income furnished on or after the 1st day of October, 2024. It is further proposed to insert a new sub-section in the said section specifying that every person who has been allotted permanent account number on the basis of Enrolment ID of Aadhaar application form filed prior to the 1st day of October, 2024, shall intimate his Aadhaar number on or before a notified date to the specified authority. These amendments will take effect from 1st October, 2024. Clause 43 of the Bill seeks to amend section 144C of the Income-tax Act, relating to reference to dispute resolution panel. It is proposed to amend sub-section (15) of the said section so as to provide that "eligible assessee" shall not include person referred to in sub-section (1) of section 158BA or section 158BD. It is further proposed to insert a new sub-section (16) so as to provide that the provisions of this section shall not apply to any proceedings under Chapte....
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....uggests that income chargeable to tax has escaped assessment in the case of an assessee for the relevant assessment year, he shall, before issuing any notice under section 148, provide an opportunity of being heard to such assessee who shall furnish his reply, within such time, as may be specified in such notice. The Assessing Officer shall, on the basis of material available on record and taking into account the reply of the assessee furnished under sub-section (2), if any, pass an order with the prior approval of the specified authority, determining whether or not it is a fit case to issue notice under section 148. It also proposed that the provisions of the section 148A shall not apply to income chargeable to tax escaping assessment for any assessment year in the case of an assessee where the Assessing Officer has received information under the scheme notified under section 135A. It also provides to insert an Explanation to explain the expression "specified authority". These amendments will take effect from 1st September, 2024. Clause 45 of the Bill seeks to substitute section 149 of the Income-tax Act relating to time limit for notice. The existing provisions of the said ....
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....ssessable. It is proposed to insert a new sub-section (1B) in the said section to provide that order of assessment of cases where return of income is furnished in consequence of an order under clause (b) of sub-section (2) of section 119 may be completed within twelve months from the end of the financial year in which such return is furnished. Sub-section (3) of the said section provides the time-limit for passing the fresh assessment order in pursuance of an order under section 254 or section 263 or section 264 setting aside or cancelling an assessment. It further provides that such fresh assessment order shall be passed at any time before the expiry of twelve months from the end of the financial year in which the order under section 250 or section 254 is received by the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner or, as the case may be, the order under section 263 or section 264 is passed by the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, as the case may be. It is proposed to insert the reference to section 250 in the said sub-section in order to provide the time-limit for dispos....
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.... of requisition under section 132A, as the case may be, shall abate and shall be deemed to have abated on the date of initiation of search or making the requisition. Sub-section (3) of said section provides that assessment or reassessment or recomputation or order passed shall also abate with reference to sub-section (1) and sub-section (3) of section 92CA. Sub-section (4) of said section provides that where any assessment under the provisions of this Chapter is pending in the case of an assessee in whose case a subsequent search is initiated, or a requisition is made, such assessment shall be duly completed, and thereafter, the assessment in respect of such subsequent search or requisition shall be made under the provisions of the said Chapter. Proviso to the said sub-section provides that period for completing the assessment shall extended to three months in given cases. Sub-section (5) of said section provides that if any proceeding initiated under this Chapter or any order of assessment or reassessment made under clause (c) of sub-section (1) of section 158BC has been annulled in appeal or any other legal proceeding, then, notwithstanding anything in this Chapter or section....
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....day of April of the previous year in which last of the authorisations was executed and ending with the date on which last of the authorisations was executed, such evidence shall not be considered for the purposes of determining the total income of the block period and such income shall be considered in the assessment made under the other provisions of the Act. Sub-section (4) of said section provides that for the purposes of determination of undisclosed income,-- (a) of a firm, such income assessed for each of the previous years falling within the block period shall be the income determined before allowing deduction of salary, interest, commission, bonus or remuneration by whatever name called to any partner not being a working partner; (b) the provisions of sections 68, 69, 69A, 69B and 69C shall, so far as may be, apply and references to "financial year" in those sections shall be construed as references to the relevant previous year falling in the block period; (c) the provisions of section 92CA shall, so far as may be, apply and references to "previous year" in that section shall be construed as reference to the relevant previous year falling in the b....
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....t Assessing Officer shall proceed to determine the total income including the undisclosed income of the block period in the manner laid down in section 158BB and the provisions of section 142, sub-sections (2) and (3) of section 143, section 144, section 145, section 145A and section 145B shall, so far as may be, apply. Clause (c) of said sub-section provides that Assessing Officer, on determination of the total income of the block period in accordance with this Chapter, shall pass an order of assessment or reassessment and determine the tax payable by him on the basis of such assessment or reassessment. Provisos of that sub-section deal with orders passed under section 144C and section 158BD. Clause (d) of said sub-section provides that the assets seized under section 132 or requisitioned under section 132A shall be dealt with in accordance with the provisions of section 132B. Sub-section (2) of said section provides that the provisions of sub-section (1) of section 143 shall not apply to the return furnished under said section. Sub-section (3) of said section provides that the prior approval shall be required for issuance of notice. Proposed section 158BD relates to undiscl....
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....he month in which the notice under section 158BC in pursuance of section 158BD, was issued to such other person. Proviso to the said sub-section provide for extension of period by twelve months under certain circumstances. Sub-section (4) of said section provides the periods which shall be excluded in computing the period of limitation. Proposed section 158BF relates to certain interests and penalties not to be levied or imposed. The said section provides that no interest under the provisions of section 234A, 234B or 234C or penalty under section 270A shall be levied or imposed upon the assessee in respect of the undisclosed income assessed or reassessed for the block period. Proposed section 158BFA relates to levy of interest and penalty in certain cases. Sub-section (1) of said section provides that where the return of total income including undisclosed income for the block period, in respect of search initiated under section 132, or books of account, other documents or any assets requisitioned under section 132A, on or after the 1st day of September, 2024, as required by a notice under clause (a) of sub-section (1) of section 158BC, is not furnished within the time specifie....
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.... assessment made under this Chapter. Proposed section 158BI relates to chapter not to apply in certain circumstances. The said section provides that the provisions of this Chapter shall not apply where a search was initiated under section 132, or books of account, other documents or any assets were requisitioned under section 132A, before the 1st day of September, 2024, and proceedings in relation to such search or requisition, as the case may be, shall be governed by the other provisions of the Act. These amendments will take effect from 1st September, 2024. Clause 50 of the Bill seeks to amend section 192 of the Income-tax Act relating to salary. The said section provides for provisions relating to deduction of tax at source on salary income. It is proposed to amend sub-sections (1C) and (2A) of the said section for giving correct reference of clause or sub-section therein. Sub-section (2B) of the said section provides for consideration of income under any other head and tax, if any, deducted thereon to be taken into account for the purposes of making the deduction under sub-section (1) of the said section. It is further proposed to expand the scope of the said sub-sectio....
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....4. Clause 53 of the Bill seeks to amend section 194C of the Income-tax Act relating to payments to contractors. Clause (iv) of the Explanation to the said section provides the meaning for the term "work". It is proposed to amend the said Clause (iv) to exclude any sum referred to in sub-section (1) of section 194J from the definition of "work". This amendment will take effect from 1st October, 2024. Clause 54 of the Bill seeks to amend section 194DA of the Income-tax Act relating to payment in respect of life insurance policy. The said section provides that any person responsible for paying to a resident any sum under a life insurance policy, including the sum allocated by way of bonus on such policy, other than the amount not includible in the total income under clause (10D) of section 10, shall, at the time of payment thereof, deduct income-tax thereon at the rate of five per cent. on the amount of income comprised therein. It is proposed to amend the said section so as to reduce the said rate of tax deduction from five per cent. to two per cent. This amendment will take effect from 1st October, 2024. Clause 55 of the Bill seeks to omit section 194F of the Income-tax Act....
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.... the said section provides that any person, being a transferee, responsible for paying to a resident transferor any sum by way of consideration for transfer of any immovable property (other than agricultural land), shall, at the time of credit or payment, whichever is earlier, of such sum to the transferor, deduct an amount equal to one per cent. of such sum or the stamp duty value of such property, whichever is higher, as income-tax thereon. Sub-section (2) of the said section provides that no deduction of tax shall be made where the consideration for the transfer of an immovable property and the stamp duty value of such property, are both less than fifty lakh rupees. It is proposed to insert a proviso to sub-section (2) of the said section so as to provide that where there is more than one transferor or transferee in respect of any immovable property, then the consideration shall be the aggregate of the amounts paid or payable by all the transferees to the transferor or all the transferors for transfer of such immovable property. This amendment will take effect from 1st October, 2024. Clause 59 of the Bill seeks to amend section 194-IB of the Income-tax Act relating to paymen....
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....ices or both to the account of an e-commerce participant or at the time of payment thereof to such e-commerce participant by any mode, whichever is earlier, deduct income-tax at the rate of one per cent. of the gross amount of such sales or services or both. It is proposed to amend the said sub-section so as to reduce the said rate of tax deduction from one per cent. to 0.1 per cent. This amendment will take effect from 1st October, 2024. Clause 62 of the Bill seeks to insert a new section 194T in the Income-tax Act relating to payments to partners of firms. Sub-section (1) of the said section provides that any person, being a firm, responsible for paying any sum in the nature of salary, remuneration, commission, bonus or interest to a partner of the firm, shall, at the time of credit of such amount to the account of the partner (including the capital account) or at the time of payment thereof, whichever is earlier, deduct income-tax thereon at the rate of ten per cent. Sub-section (2) of the said section provides that no deduction shall be made under sub-section (1) where such sum or, the aggregate of such sums credited or paid or likely to be credited or paid to the partner ....
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....t thereof by any mode, whichever is earlier, deduct income-tax thereon at the rate of ten per cent. It is proposed to amend the said section so as to provide that where any income by way of interest or dividends in respect of bonds or Global Depository Receipts referred to in section 115AC or by way of long-term capital gains arising from the transfer of such bonds or Global Depository Receipts is payable to a non-resident, the person responsible for making the payment shall, at the time of credit of such income to the account of the payee or at the time of payment thereof by any mode, whichever is earlier, deduct income-tax thereon at the rate of,-- (a) ten per cent. in respect of income by way of interest or dividends in respect of bonds or Global Depository Receipts referred to in section 115AC; (b) ten per cent. in respect of long-term capital gains arising from transfer of such bond or Global Depository Receipts referred to in section 115AC which takes place before the 23rd day of July, 2024; (c) twelve and one-half per cent. in respect of long-term capital gains arising from transfer of such bond or Global Depository Receipts referred to in section 115AC which takes pl....
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....sub-section states that a person may also deliver to the prescribed authority a correction statement for rectification of any mistake or to add, delete or update the information furnished in the statement delivered under this sub-section in such form and verified in such manner as may be specified by the authority. It is proposed to amend the said section to provide that no correction statement shall be delivered after the expiry of six years from the end of the financial year in which the statement referred to in sub-section (3) is required to be delivered. This amendment will take effect from 1st April, 2025. Clause 68 of the Bill seeks to amend section 200A of the Income-tax Act relating to processing of statements of tax deducted at source. The said section provides the manner in which statement of tax deduction at source or a correction statement made by a person deducting any sum (deductor) under section 200 shall be processed. It is proposed to amend the marginal heading to insert the words "and other statements". It is proposed to insert a new sub-section (3) in the said section to provide that the Board may make a scheme for processing of statements which have been m....
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....om 1st April, 2025. It is also proposed to amend the sub-section (4) of the said section, to provide that credit for amount collected and paid to the Central Government shall also be given to any other person eligible for credit for the amount so collected in a particular assessment year in accordance with the rules as may be made under the said Act. This amendment will take effect from 1st January, 2025. Sub-section (7) of the said section provides that if any person who is liable to collect tax at source does not collect it or after so collecting fails to pay the same to the credit of the Central Government, then he shall be liable to pay interest at the rate of one per cent. for every month or part of month on the amount of such tax from the date on which such tax was collected to the date on which such tax is actually paid. It is also proposed to amend the said sub-section so as to increase the rate of simple interest from one per cent. to one and one-half per cent. if the person responsible for collecting tax, after collecting the tax fails to pay it as required under this section. It is also proposed to insert a new sub-section (7A) to the said section so as to provide t....
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....to amend the proviso to the said sub-section by inserting the reference of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 therein, so as to impose the liabilities under the said Act for the purposes of obtaining the certificate relating to no liabilities. This amendment will take effect from 1st October, 2024. Clause 72 of the Bill seeks to amend section 244A of the Income-tax Act relating to interest on refunds. The proviso to sub-section (1A) of the said section provides that where proceedings for assessment or reassessment are pending in respect of an assessee, in computing the period for determining the additional interest payable to such assessee under this sub-section, the period beginning from the date on which such refund is withheld by the Assessing Officer in accordance with and subject to provisions of sub-section (2) of section 245 and ending with the date on which such assessment or reassessment is made, shall be excluded. It is proposed to amend the said proviso to substitute the words "on which such assessment or reassessment is made" with the words "upto which such refund is withheld". This amendment will take effect fro....
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....e Bill seeks to amend section 245R of the Income-tax Act relating to procedure on receipt of application. Sub-section (2) of the said section provides that the Authority may, after examining the application and the records called for, by order, either allow or reject the application. It is proposed to insert a new proviso to the said sub-section to provide that on receipt of an application under the proviso to sub-section (4) of section 245Q, the Board for Advance Rulings may, by an order under the said sub-section, reject the application referred to in sub-section (1) thereof as withdrawn, on or before the 31st December, 2024. This amendment will take effect from 1st October, 2024. Clause 76 of the Bill seeks to amend section 246A of the Income-tax Act relating to appealable orders before Commissioner (Appeals). It is proposed to amend the said section so as to insert a new clause after clause (k) to provide that an order passed under clause (c) of sub-section (1) of section 158BC in respect of search initiated under section 132, or books of account, other documents or any assets requisitioned under section 132A may be appealable under that section. This amendment will take ....
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...., provide that if a person referred to in sub-section (1) of section 285BA of the Act, who is required to furnish a statement under that section, provides inaccurate information in the statement, and where such inaccuracy is due to the circumstances specified in clauses (a) to (c) therein, then, the prescribed incometax authority under sub-section (1) of section 285BA may direct that such person shall pay, by way of penalty, a sum of fifty thousand rupees. It is proposed to substitute the said sub-section so as to provide that if a person who is required to furnish a statement under section 285BA, provides inaccurate information in the statement or fails to furnish correct information within the period specified under sub-section (6) of the said section 285BA; or fails to comply with the due diligence requirement prescribed under sub-section (7) of the said section, then, the prescribed income-tax authority referred to in sub-section (1) thereof may direct that such person shall pay, by way of penalty, a sum of fifty thousand rupees. This amendment will take effect from 1st October, 2024. Clause 80 of the Bill seeks to insert a new section 271GC in the Income-tax Act relating to....
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....ovides that no penalty can be imposed in a case where appeal is preferred before the Commissioner of Income tax (Appeal) under section 246 or section 246A after the end of the financial year in which the proceedings, in the course of which action for imposition of penalty has been initiated are completed, or six months from the end of the month in which the order of the Commissioner of Income tax (Appeal) is received by the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, whichever period expires later. It is proposed to amend sub-sections (1) and (1A) of the said section so as to omit the reference of the Principal Chief Commissioner or Chief Commissioner from the said subsections. These amendments will take effect from 1st October, 2024. Clause 84 of the Bill seeks to amend section 276B of the Income-tax Act, relating to failure to pay tax to the credit of Central Government under Chapter XII-D or XVII-B. The said section, inter alia, provides that if a person fails to pay to the credit of the Central Government, the tax deducted at source by him as required by or under the provisions of Chapter XVII-B, he shall be punishable with ....
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.... the said rule, so as to provide that any expenditure which is not admissible under the provisions of section 37 in computing the profits and gains of a business, shall be included back to the profits and gains of the life insurance business. This amendment will take effect from 1st April, 2025 and will, accordingly, apply in relation to the assessment year 2025-2026 and subsequent years. Clauses 88 to 99 of the Bill seek to insert a new Chapter to provide the Direct Tax Vivad se Vishwas Scheme, 2024. The Chapter, inter alia, provides-- (a) the definitions of certain expressions relating to "appellant", "appellant forum", "declarant", "declaration", "designated authority", "disputed fee", "disputed income", "disputed interest", "disputed penalty", "disputed tax", "last date", "specified date" and "tax arrear"; (b) the provisions relating to the amount payable by the declarant; (c) the provisions relating to the particulars to be furnished in the form of declaration; (d) the provisions relating to the time and manner of payment of tax arrear; (e) the provisions relating to immunity from initiation of proceedings in respect of offence and imposition of penalty in certain....
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....n number G.S.R. 356(E), dated the 10th May, 2023, to notify the amended conditions, retrospectively, with effect from the 1st day of April, 2023 as specified in the Second Schedule. The clause further seeks to provide consequential admissible refund if the person claiming the refund makes an application on or before the 31st day of March, 2025. Customs Tariff Clause 106 of the Bill seeks to omit section 6 of the Customs Tariff Act as the tariff commission has been wound up vide Resolution, dated 1st June, 2022 by the Government of India. Clause 107 of the Bill seeks to amend the First Schedule to the Customs Tariff Act so as to create new tariff lines in the manner specified in,-- (a) the Third Schedule with a view to revise the rates in respect of certain tariff items; (b) the Fourth Schedule so as to create new tariff lines, modify existing tariff lines and revise the rates in respect of certain tariff items with effect from the 1st day of October, 2024; Excise Clause 108 of the Bill seeks to amend the notification issued under sub-section (1) of section 5A of the Central Excise Act, vide number G.S.R.163(E), dated 17th March, 2012, retrospectively, with effect from 29t....
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....ancellation of registration, as the case may be, till the date of order of revocation of cancellation of registration, filed within thirty days of the date of order of revocation of cancellation of registration, subject to the condition that the time-limit for availment of credit in respect of the said invoice or debit note should not have already expired under sub-section (4) of the said section on the date of order of cancellation of registration. The aforesaid amendments are proposed to be made effective from the 1st day of July, 2017. Further it is proposed that where the tax has been paid or the input tax credit has been reversed, no refund of the same shall be admissible. Clause 115 of the Bill seeks to amend sub-section (5) of section 17 of the Central Goods and Services Tax Act, so as to restrict the non availability of input tax credit in respect of tax paid under section 74 of the said Act only for demands upto Financial Year 2023-24. It also proposes to remove reference to sections 129 and 130 in the said sub-section. Clause 116 of the Bill seeks to make consequential amendment in section 21 of the Central Goods and Services Tax Act, so as to incorporate a reference....
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....of unutilised input tax credit or of integrated tax shall be allowed in cases of zero rated supply of goods where such goods are subjected to export duty. Clause 125 of the Bill seeks to make consequential amendments in sub-section (3) of section 61 of the Central Goods and Services Tax Act, so as to incorporate a reference to the proposed new section 74A. Clause 126 of the Bill seeks to make consequential amendments in sub-section (1) of section 62 of the Central Goods and Services Tax Act, so as to incorporate a reference to the proposed new section 74A. Clause 127 of the Bill seeks to make consequential amendments in section 63 of the Central Goods and Services Tax Act, so as to incorporate a reference to the proposed new section 74A. Clause 128 of the Bill seeks to make consequential amendments in sub-section (2) of section 64 of the Central Goods and Services Tax Act, so as to incorporate a reference to the proposed new section 74A. Clause 129 of the Bill seeks to make consequential amendments in sub-section (7) of section 65 of the Central Goods and Services Tax Act, so as to incorporate a reference to the proposed new section 74A. Clause 130 of the Bill seeks to make c....
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.... proposed section 74A or the relevant sub-sections thereof. Clause 136 of the Bill seeks to make consequential amendments in sub-section (1) of section 104 of the Central Goods and Services Tax Act, so as to incorporate a reference to sub-sections (2) and (7) of the proposed new section 74A. Clause 137 of the Bill seeks to amend sub-section (6) of section 107 of the Central Goods and Services Tax Act, so as to reduce the maximum amount of pre-deposit for filing appeal before the Appellate Authority from rupees twenty-five crores to rupees twenty crores in central tax. It also proposes to make consequential amendments in sub-section (11) of the said section to incorporate a reference to the proposed new section 74A. Clause 138 of the Bill seeks to amend section 109 of the Central Goods and Services Tax Act, so as to empower the Appellate Tribunal to examine the matters or adjudicate the cases referred to in sub-section (2) of section 171, if so notified under the said section. Such matters are proposed to be examined or adjudicated only by the Principal Bench. It also empowers the Government to notify types of cases that shall be heard only by the Principal Bench of the Appella....
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....he appointed day, for which invoices were also received prior to the appointed date. The said amendment is proposed to be made effective from 1st day of July, 2017. Clause 144 of the Bill seeks to amend sub-section (2) of section 171 of the Central Goods and Services Tax Act, so as to empower the Government to notify the date from which the Authority under the said section shall not accept any application for anti-profiteering cases. An Explanation is also proposed to be inserted so as to include the reference of "Appellate Tribunal" in the expression "Authority" under the said section to enable the Government to notify the Appellate Tribunal to act as an Authority to handle antiprofiteering cases. Clause 145 of the Bill seeks to amend Schedule III to the Central Goods and Services Tax Act, so as to provide that the activity of apportionment of co-insurance premium by the lead insurer to the co-insurer for the insurance services jointly supplied by the lead insurer and the co-insurer to the insured in coinsurance agreements shall be treated as neither supply of goods nor supply of services, provided that the lead insurer pays the tax liability on the entire amount of premium pa....
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.... payable as pre-deposit for filing appeal before the Appellate Tribunal from rupees hundred crores to rupees forty crores of integrated tax. Union Territory Goods and Services Tax Clause 151 of the Bill seeks to amend sub-section (1) of section 7 of the Union Territory Goods and Services Tax Act, so as to not to levy Union territory tax on extra neutral alcohol or rectified spirit used for manufacture of alcoholic liquor for human consumption. Clause 152 of the Bill seeks to insert a new section 8A in the Union Territory Goods and Services Tax Act, so as to empower the Government to regularise non-levy or short levy of Union territory tax where it is satisfied that such non-levy or short levy was a result of general practice. Goods and Services Tax (Compensation to States) Clause 153 of the Bill seeks to insert a new section 8A in the Goods and Services Tax (Compensation to States) Act, so as to empower the Government to regularise non-levy or short levy of cess where it is satisfied that such non-levy or short levy was a result of general practice. Miscellaneous Clause 154 of the Bill seeks to amend the Prohibition of Benami Property Transactions Act, 1988. Sub-section (2....
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....e tender of immunity made to, and accepted by, the person benamidar or such other person, shall, to the extent to which the immunity extends, render him immune from prosecution for the offence in respect of which the tender was made and from the imposition of any penalty under section 53. Sub-section (3) of proposed new section provides that if it appears to the Initiating Officer that any person to whom immunity has been tendered under this section has not complied with the conditions subject to which the tender was made, or is wilfully concealing anything, or is giving false evidence, the Initiating Officer may record a finding to that effect, and with the previous sanction of the competent authority as referred to in section 55, withdraw the immunity so tendered. Sub-section (4) of the proposed new section provides that any person against whom the immunity tendered is withdrawn in accordance with sub-section (3), may be tried for the offence in respect of which the tender of immunity was made or for any other offence of which he appears to have been guilty in connection with the same transaction and shall also be liable for penalty under this Act to which he would otherwise ha....