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Certificate for lower or nil tax deduction extended to business trust interest, enabling reduced TDS where exemptions justify it.
The amendment extends eligibility for a certificate for deduction of tax at a lower or nil rate to sums on which tax is required to be deducted in relation to business trust interest income, enabling reduced deduction where exemptions (for example, for certain sovereign wealth and pension funds) justify such reduction; the change applies prospectively from 1 April, 2023.
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Presumptive taxation thresholds increased for businesses and professionals, conditional on low cash receipts and audit exemption.
Eligibility thresholds for presumptive taxation schemes are increased for businesses and professionals on the condition that cash receipts do not exceed a prescribed low percentage of total turnover or gross receipts; cheques and non-account-payee bank drafts are deemed cash for this purpose. Persons declaring profits under the presumptive schemes and meeting the cash-receipt condition are exempt from the statutory audit requirement, with the amendments effective from the stated assessment year.
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Amortization of preliminary expenditure: approval requirement removed; assessee must file prescribed statement to claim deduction.
Amendment removes the Board approval requirement for entities performing preparatory activities tied to amortization of preliminary expenditure and replaces it with a requirement that the assessee furnish a prescribed statement containing particulars of such expenditure to the prescribed income tax authority within the prescribed period and form; effective from 1 April 2024 for the relevant assessment year.
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Concessional tax regime for new manufacturing co-operative societies, subject to eligibility conditions, irrevocable option and transfer pricing checks.
A new concessional tax regime permits resident new manufacturing co-operative societies to elect an irrevocable concessional tax rate, subject to prescribed conditions: total income must be computed without specified deductions or set off of earlier losses attributable to those deductions, depreciation must be claimed as prescribed, non manufacturing income and certain excess profits from related-party arrangements are taxed at higher fixed rates, and specified domestic transactions are subject to arm's length pricing; limited use of previously used machinery is permitted under conditions.
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Strategic disinvestment: redefined to cover government or public sector share sales reducing majority shareholding and enabling loss carryforward on amalgamation.
Section 72A is amended to expand strategic disinvestment to include sale of shareholding by the Central Government, State Government or a Public Sector Company that reduces their shareholding below fifty-one per cent and transfers control to the buyer; transfer of control may be effected by any one or more of those entities. Section 72AA is amended to allow carry forward and set off of accumulated losses and unabsorbed depreciation where banking companies amalgamate with another banking institution or company within five years of such strategic disinvestment. The amendments take effect from 1 April 2023.
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Exemption for statutory development authorities expanded to cover non-company bodies providing public services, subject to notification.
Income of a body or authority or Board or Trust or Commission, not being a company, established or constituted by Central or State Act for specified public purpose objects (housing, planning/development of settlements, regulating or developing activities for public benefit, or regulating matters arising from their object) is proposed to be exempted under a new clause, subject to Central Government notification in the Official Gazette; consequential statutory amendments follow and the change applies prospectively to the relevant assessment year.
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Tax exemption for ODI distributions prevents double taxation, easing IFSC banking unit pass-through of taxed income.
Amendments extend the transfer period for original funds to resultant funds on relocation, exempt income distributed to non-resident holders of Offshore Derivative Instruments provided the income was charged to tax in the IFSC banking unit and will incorporate IFSCA (Fund Management) Regulations, 2022 into the definitions of specified, resultant and investment funds to align statutory definitions with the regulatory regime.
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Conversion of Gold to Electronic Gold Receipt: excluded from transfer for capital gains; cost basis and holding period preserved.
Conversion between physical gold and an Electronic Gold Receipt issued by a Vault Manager is proposed to be excluded from the definition of transfer for capital gains. The cost of acquisition of an EGR will be deemed the cost of the underlying gold in the hands of the person in whose name the EGR is issued, and vice versa for gold released against an EGR. The holding period for capital gains will include periods during which the gold or the EGR was held prior to conversion.
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Extension of start up incorporation cutoff expands section 80 IAC eligibility, applying from the stated effective assessment year onward.
The amendment extends the incorporation cutoff so that enterprises incorporated on or before 1st April 2024 qualify as eligible start ups for the three year full deduction under section 80 IAC, subject to the existing turnover ceiling, Inter Ministerial Board certification and other statutory conditions, and is to have effect from 1st April 2023 for the relevant assessment year and subsequent years.
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Carry-forward loss relief extended for startups, easing shareholding continuity requirement to permit set-off of past losses.
Amendment extends the proviso to the carry forward and set off rule so that eligible start-ups may set off carried forward losses incurred within ten years of incorporation under the existing shareholders-continuity relaxation, aligning this period with the ten-year reference in the start-up incentive provision; the change applies from the assessment year 2023-24.
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Cash transaction limit relief for primary co operatives raises the threshold before penalty for member transactions.
The amendments raise the electronic payment threshold for primary agricultural credit societies and primary co operative agricultural and rural development banks so that acceptance of loans or deposits from, or repayment to, their members will be required to be by account payee cheque, account payee bank draft or online bank transfer only where the amount equals or exceeds two lakh rupees; penalties will attach only above that threshold.
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TDS threshold for co-operative societies increased, altering cash withdrawal TDS applicability and retaining higher deduction rates for non-filers.
The Finance Bill, 2023 amends Section 194N to treat co-operative societies as if the statutory cash-withdrawal TDS threshold were replaced by a higher threshold for the purpose of that section, effective from the start of the next financial year, while preserving the existing non-filer deduction rates and the statutory definition of non-filer.
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Deductibility of sugarcane purchase price: recomputation permitted for co-operative mills where prices meet government-fixed approvals.
Confirms that payments by sugar co-operative mills for purchase of sugarcane at prices equal to or less than government-fixed or approved rates are allowable as a deduction for computing business income. Where such deductions were previously claimed and disallowed, an assessee may apply to the tax authority for recomputation of total income for the relevant previous year; the authority must allow the deduction to the extent the expenditure meets the qualifying price condition and apply rectification provisions and the prescribed processing period.
News Bills
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Agniveer Corpus Fund tax exemption: contributions and Seva Nidhi receipts exempt, government contribution treated as salary with deduction.
The Agnipath Scheme creates a non-lapsable Agniveer Corpus Fund holding Agniveer contributions, matching Government contributions and interest; Seva Nidhi is the one-time terminal package payable on completion of engagement. The Finance Bill proposes to exempt Seva Nidhi receipts from income tax and to permit deduction from total income of both the Agniveer's deposits and the Government's matching contributions, while treating the Government contribution as salary with a corresponding deduction and extending a similar deduction in the new tax regime.
News Bills
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Payment timing for micro and small enterprises: tax deduction allowed only on actual payment when MSMED timelines are missed.
An amendment to Section 43B inserts a clause disallowing accrual-based deduction for sums payable to micro and small enterprises when payment is made after the time limits prescribed by the MSMED Act; the proviso to Section 43B will not apply to such payments, and only payments made within the MSMED timelines qualify for accrual-based deduction.
News Bills
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Retrospective GST exemptions and reclassifications bar refunds on tax already collected despite prior tax treatment.
Two retrospective GST amendments reclassify past tax treatments and bar refunds: unintended waste from fish meal production (excluding fish oil) is retrospectively exempted for the earlier period but collected tax is non refundable; and grant of alcoholic liquor licences is retrospectively treated as neither supply of goods nor supply of services, with tax already collected likewise not refundable.
News Bills
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Interest rate under section 50(3) CGST Act set retrospectively to a prescribed statutory rate affecting tax interest liability.
Notification No. 10/2017 (Union Territory Tax) is amended retrospectively from 1 July 2017 to prescribe the rate of interest under sub-section (3) of section 50 of the CGST Act as 18%, thereby fixing the statutory interest chargeable under that CGST provision for the retrospective period.
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Interest rate under CGST Act fixed retrospectively, establishing a statutory uniform rate effective from July 2017.
A retrospective amendment to Notification No. 6/2017 fixes the statutory interest rate applicable under the CGST interest provision, with effect from 1 July 2017, by specifying the rate of interest under subsection (3) of the relevant CGST provision.
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Input tax credit restrictions clarified: availment conditioned on communication and extended rectification windows provided.
Amendments condition availment of input tax credit on absence of restrictions in communications to recipients and extend the claim and rectification window to the thirtieth day of November of the following financial year; they remove two way return communication, replace it with prescribed one way auto generated communication of inward supplies and credits, require tax period sequential filing of outward supplies, substitute provisional credit claims with self assessed credit subject to conditions, limit utilisation and transfer of electronic ledgers, restate interest on wrongly availed credit retrospectively, and clarify refund claim procedures and withholding scope.
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Retail sale price valuation provisions superseded to align central excise valuation with the post GST legal framework under new notification.
Notification No. 49/2008 set out retail sale price based valuation and abatements under section 4A of the Central Excise Act; it has been superseded by Notification No. 01/2022 dated 1 February 2022 to align excise valuation and abatement treatment with the post GST legal framework.

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Review of Customs duty Exemptions - Review of conditional exemption rates of BCD

24 July, 2024

Contents
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Union Budget 2024-25 (Full) + FINANCE (No.2) Bill, 2024

(i) The BCD exemption for the goods covered under following serial numbers of the notification are being extended upto 31st March, 2026 unless specified otherwise.

S. No.

S N of 50/17-Cus

Brief Description

1.

17

Specified Planting materials, namely, oilseeds, seeds of vegetables, tubers, etc.

2.

80A

Algal oil for manufacturing of aquatic feed

3.

90

Lactose for use in manufacture of homeopathic medicines

4.

104

Specified goods used in processing of sea-food

5.

133

Gold ores and concentrates

6.

139

Bunker Fuels namely: (i). IFO 180 CST; (ii). IFO 380 CST; (iii). VLSFO (CTH 27)

7.

150

Naphtha for manufacture of Fertilisers (scope of exemption is being reduced only to Naphtha)

8.

155

Liquefied petroleum gases (LPG) received from unit in SEZ and returned by the DTA unit to the SEZ unit

9.

164

Electrical energy supplied from SEZ unit to DTA

10.

165

Electrical energy supplied from SEZ to DTA

11.

172

Specified goods used in manufacture of silicon wafers or solar wafers, for manufacture of solar cell or module

12.

183

Medical use fission Molybdenum-99 (Mo-99) for use in manufacture of radio pharmaceuticals

13.

184

Pharmaceutical Reference Standard

14.

188

Goods for manufacture of ELISA Kits

15.

191

Maltol for manufacture of deferiprone

16.

204

Anthraquinone or 2-Ethyl Anthraquinone for use in manufacture of Hydrogen peroxide

17.

237

Specified material for manufacture of EVA (Ethylene Vinyl Acetate) sheets or backsheet, which are used in the manufacture of solar photovoltaic cells or modules (Scope of materials which can be imported is being increased)

18.

253

Specified Goods for manufacture of Brushless Direct Current (BLDC) motors

19.

257

Tags, labels, stickers, belts, buttons, hangers or printed bags, imported by bonafide exporters

20.

257A

Specified goods used in manufacture of handicraft items for export when imported by bonafide exporter

21.

257B

Specified goods used in manufacture of textile or leather garments for export when imported by bonafide exporter

22.

257C

Specified goods used in manufacture of leather or synthetic footwear or other leather products for export when imported by bonafide exporter

23.

258

Security fibre, threads, Paper based Taggant, M-feature for use in manufacture of security paper by Security Paper Mill, Hoshangabad and Bank Note Paper Mill India Pvt Ltd, Mysore.

24.

259

Raw materials for manufacture of security fibre and security thread for supply to Security Paper Mill, Hoshangabad and Bank Note Paper Mill India Pvt. Ltd, Mysore for use in manufacture of security paper

25.

260

Goods for the manufacture of specified orthopedic implants (902110)

26.

261

Raw material for manufacture of Copper-T Contraceptive

(i) Alatheon

(ii) Copper Wire

27.

265

Capacitor grades polypropylene granules for manufacture of Capacitor grade plastic

28.

269

Super absorbent polymer for manufacture of adult diapers and specified goods

29.

271

Polytetrametylene ether glycol, (PT MEG) for use in manufacture of spandex yarn

30.

276

Ethylene- propylene- non-conjugated diene rubber (EPDM) for manufacture of insulated wire and cables

31.

279

New or retreated Pneumatic tyres of rubber for use in servicing, repair of maintenance of aircrafts used for operating scheduled air transport service or scheduled air cargo service etc

32.

280

New or retreated Pneumatic tyres of rubber for use in servicing, repair or maintenance of aircraft imported or procured by Aero Club of India/ for flying training purpose/ operating non-scheduled (passenger or charter) services/ AAI for flight calibration purpose

33.

290

Wood pulp for manufacture of newsprint, paper or paperboard

34.

292

Goods imported for manufacture of paper, paper boards, newsprint

35.

293A

Newsprint and uncoated paper imported for printing of newsprint

36.

296A

Lightweight coated paper imported by actual users for printing of magazines

37.

326

Hydrophilic /Hydrophobic Non- Woven, imported for use in the manufacture of Adult Diapers

38.

329

Pile fabrics for the manufacture of toys

39.

333

Moulds, tools and dies, for the manufacture of parts of electronic components or electronic equipment

40.

334

(i) Graphite Felt or Graphite pack for growing silicon ingots (ii) Thin Steel wire used in wire saw for slicing of silicon wafers

41.

345A

Simply Sawn Diamonds

42.

364A

Spent catalyst or ash containing precious metals

43.

368

Ferrous Scrap

44.

374

Magnesium Oxide (MgO) coated cold rolled steel coils for use in manufacture of cold rolled grain oriented (CRGO) steel

45.

375

Specified items for manufacture of cold rolled grain-oriented steel (CRGO) steel

46.

378

Metal parts for manufacture of electrical insulators falling under heading 8546

47.

379

Pipes and tubes for use in manufacture of boilers

48.

380

Forged steel rings for manufacture of special bearings for use in wind operated electricity generators

49.

381

Flat copper wire for use in the manufacture of photo voltaic ribbon for manufacture of solar photovoltaic cell or modules

50.

392

Dies for drawing metal, where imported after repairs from abroad

51.

403

Parts and raw materials for offshore oil exploration

52.

404

Specified items including capital goods and raw materials for off shore oil exploration

53.

415

Parts for manufacture of catalytic convertors

54.

415A

Platinum or Palladium for manufacture of Noble Metal Compounds & Noble Metal Solutions

55.

416

Ceria zirconia compounds for use in the manufacture of washcoat for catalytic converters

56.

417

Cerium compounds for use in the manufacture of washcoat for catalytic converters

57.

418

Zeolite for use in the manufacture of washcoat for catalytic converters

58.

422

Machinery, electrical equipment for use in semiconductor wafer and LCD

59.

423

Machinery, electrical equipment for use in marking and packaging of semiconductor chips

60.

426

Specified goods for the manufacture of semiconductor devices, memory card, IC, solar cell

61.

435

Capital goods for printing industry

62.

442

Bushings made of Platinum and Rhodium alloy when imported in exchange of worn out or damaged bushings exported out of India

63.

446

Parts and components for manufacture of tunnel boring machines

64.

451

Evacuated tubes with three layers of solar selective coating for use in manufacture of solar water heater

65.

462

Ball screws for use in the manufacture of CNC Lathes

66.

463

Linear Motion Guides for use in the manufacture of CNC Lathes

67.

464

CNC Systems for use in the manufacture of CNC Lathes

68.

464A

Goods for manufacture of plastic processing machineries

69.

467

Parts and components of cash dispenser or automatic bank note dispenser

70.

468

Parts for manufacture of Micro ATM, Fingerprint reader/scanner, Iris scanner, Miniaturised POS (Scope of exemption is being limited to import of raw materials only)

71.

471

All parts for use in the manufacture of LED lights

72.

472

All inputs for use in the manufacture of LED driver or MCPCB for LED lights

73.

476

Television equipment, cameras etc for taking films, imported by a foreign film unit or television team

74.

477

Filming equipment of foreign origin if imported into India after having been exported therefrom.

75.

480

Goods imported for being tested in specified test centers

76.

489B

Goods for manufacturing of Microphones

77.

504

Parts and Components of Digital Still Image Video Cameras

78.

509

Parts, components and accessories for manufacture of Digital Video Recorder

79.

510

 Parts, components and accessories for use in manufacture of reception apparatus for television

80.

511

Parts, components and accessories for manufacture of CCTV Camera

81.

512

Specified Parts, components and for use in manufacture of Lithium-ion battery and battery pack

82.

512A

Inputs, parts or sub-parts for use in the manufacturing of Printed Circuit Board Assembly

83.

515A

Open Cell for manufacture of TV Panel

84.

516

The following goods for use in the manufacture of Liquid Crystal Display (LCD) /LED TV Panel

85.

517

Magnetrons for manufacture of domestic microwave ovens

86.

519

Raw materials or parts for use in manufacture of e-Readers

87.

523A

Parts, sub-parts, inputs or raw material for use in manufacture of Lithium-ion cells

88.

527

Lithium-ion cell use in manufacture of battery or battery pack

89.

527A

Lithium-Ion Cell for use in manufacture of battery or battery pack of cellular mobile

90.

527B

Lithium-Ion Cell manufacture of battery or battery pack of EV

91.

534

Parts of gliders or simulators of aircrafts (excluding rubber tyres and tubes of gliders)

92.

535

Raw materials for manufacture of aircraft and parts of aircraft

93.

535A

Parts of aircraft for manufacture of aircraft or for manufacture of parts of aircraft by PSU under Min of Defence

94.

536

Parts, testing equipment, tools and tool-kits for maintenance, repair, and overhauling of aircraft, components or parts of aircrafts

95.

537

All goods of Heading 8802 (except 88026000-spacecraft)

96.

538

Components or parts, including engines, of aircraft of heading 8802

97.

539

(a) Satellites and payloads; (b) Ground equipment brought for testing of (a)

98.

539A

Scientific and technical instruments etc for launch vehicles and satellites

99.

540

Specified goods imported by scheduled air transporter

100.

542

Specified goods imported by Aero Club, Flying Training Institutes

101.

543

Specified goods imported by non-scheduled air transporter

102.

544

Parts (other than rubber tubes), of aircraft of heading 8802

103.

546

Parts (other than rubber tubes), of aircraft of heading 8802

104.

548

Barges or pontoons imported along with ships

105.

551

Cruise ships, Excursion ships

106.

553

Fishing vessels, Tugs and Pusher crafts, light vessels excluding vessels and floating structure imported for break up

107.

555

Vessels like warships, lifeboats excluding vessels and floating structure imported for break up

108.

567

Stainless steel tube and wire, for manufacture of Coronary stents /artificial valve

109.

569

Parts required for manufacture of Ostomy products

110.

570

Medical and surgical instruments, apparatus and appliances including spare parts and accessories thereof

111.

575

Specified Hospital Equipment for use in specified hospitals

112.

578A

Raw materials, for the manufacture of Cochlear Implants

113.

580

X-Ray Baggage Inspection Systems and parts thereof

114.

581

Portable X-ray machine / system

115.

583

Parts and cases of braille watches, for the manufacture of Braille watches

116.

591

Parts of electronic toys

117.

593

Parts of video games for the manufacture of video games

Note: Description of entries is indicative. Notification may be referred to for complete description.

(ii) The BCD exemption for the goods covered under following serial numbers of the notification no 50/2017-Customs is being extended upto 31st March 2029.

S. No.

S. No. of 50/2017Cus

Brief Description

1.

212A

Medicines/drugs/vaccines supplied free by United  Nations International Children's Emergency Fund (UNICEF), Red Cross etc

2.

213

Drugs and materials

3.

428

Specified goods imported by accredited press cameraman

4.

429

Specified goods, imported by accredited journalist

5.

549

Capital goods, raw materials and spares for repairs of ocean-going vessels

6.

550

Spare parts and consumables for repairs of ocean going vessels registered in India.

7.

577

Lifesaving medical equipment for personal use

8.

607

Life Saving drugs like Keytruda etc

9.

607A

Lifesaving drugs/medicines for personal use

10.

611

Archaeological artefacts for exhibition in a museum

11.

612

Specified raw material for sports goods

Note: Description of entries is indicative. Notification may be referred to for complete description.


Full Text:

Union Budget 2024-25 (Full) + FINANCE (No.2) Bill, 2024

Topics

Acts Income Tax