Just a moment...

Top
Help
×

By creating an account you can:

Logo TaxTMI
Call Us / Help / Feedback

Contact Us At :

E-mail: [email protected]

Call / WhatsApp at: +91 99117 96707

For more information, Check Contact Us

FAQs :

To know Frequently Asked Questions, Check FAQs

Most Asked Video Tutorials :

For more tutorials, Check Video Tutorials

Submit Feedback/Suggestion :

Email :
Please provide your email address so we can follow up on your feedback.
Category :
Description :
Min 15 characters0/2000
Make Most of Text Search
  1. Checkout this video tutorial: How to search effectively on TaxTMI.
  2. Put words in double quotes for exact word search, eg: "income tax"
  3. Avoid noise words such as : 'and, of, the, a'
  4. Sort by Relevance to get the most relevant document.
  5. Press Enter to add multiple terms/multiple phrases, and then click on Search to Search.
  6. Text Search
  7. The system will try to fetch results that contains ALL your words.
  8. Once you add keywords, you'll see a new 'Search In' filter that makes your results even more precise.
  9. Text Search
Add to...
You have not created any category. Kindly create one to bookmark this item!
Create New Category
Hide
Title :
Description :
❮❮ Hide
Default View
Expand ❯❯
Close ✕
🔎 TMI Notes - Adv. Search
TEXT SEARCH:

Press 'Enter' to add multiple search terms. Rules for Better Search

Search In:
Main Text + AI Text
  • Main Text
  • Main Text + AI Text
  • AI Text
Law:
---- All Laws----
  • ---- All Laws----
  • Benami Property
  • Bill
  • Central Excise
  • Companies Law
  • Customs
  • DGFT
  • FEMA
  • GST
  • GST - States
  • IBC
  • Income Tax
  • Indian Laws
  • Money Laundering
  • SEBI
  • SEZ
  • Service Tax
  • VAT / Sales Tax
Types:
---- All Types ----
  • ---- All Types ----
  • Act Rules
  • Case Laws
  • Circulars
  • Manuals
  • News
  • Notifications
Sort By: ?
In Sort By 'Default', exact matches for text search are shown at the top, followed by the remaining results in their regular order.
RelevanceDefaultDate
    Case LawsIncome Tax
    Distinction between Capital Gains and Business Income: Comprehensive Analysis of a Income Tax Case
    Case LawsIncome Tax
    A Multifaceted Legal Analysis on Transfer Pricing and Tonnage Tax Scheme, Bareboat Charter, Interest...
    Case LawsIncome Tax
    Assessment of Eligibility for Tax Deductions Under Scrutiny: Tribunal Upholds PCIT's Revisionary Pow...
    Case LawsCustoms
    Insight into Penalties for Procedural Lapses in Customs Documentation
    Legalities of Input Tax Credit Refunds (IGST), period of limitation and COVID-19 pandemic: A Case St...
    Case LawsCentral Excise
    Reversal of CENVAT Credit: A Critical Analysis of a Recent Legal Dispute
    Case LawsIncome Tax
    Taxation of Employee Benefits: TDS on value of accommodation provided to the employees at the rate o...
    Case LawsIncome Tax
    The Intricacies of Unexplained Investment and Legal Recourse: A Comprehensive Analysis of a recent C...
    Navigating Legal Intricacies: Power to arrest under PMLA and compliance with CrPC
    Case LawsIncome Tax
    Intricacies of Taxation on Interconnect Charges in Telecom: Unraveling the Concept of 'Use or Right ...
    Case LawsVAT / Sales Tax
    The Priority of Secured Creditors in Financial Recoveries: A Comprehensive Analysis of Central Bank ...
    Navigating the Intricacies of Seizure and Confiscation under the GST Regime: A Detailed Analysis of ...
    Case LawsIncome Tax
    The Principle of Mutuality in Taxation: A Comprehensive Analysis of a Landmark Supreme Court Decisio...
    Case LawsService Tax
    Legal Nuances in CENVAT Credit Rules and Extended Limitation Periods: A Detailed Analysis
    Case LawsService Tax
    Cenvat Credit - Input Service Distributors and the Extended Period of Limitation in Service Tax Law:...
    Case LawsCustoms
    Complexities of Gold Importation - Prohibited Goods and Redemption: An Analysis of the 2023 (8) TMI...
    Case LawsIndian Laws
    A Case Study on Condonation of Delay in filing the Appeal in Indian Legal System
    Restrictions on availing Input Tax Credit (ITC) - constitutional validity of Section 16(4): A Landma...
    Case LawsIncome Tax
    Landmark Income Tax Reassessment Case
    Case LawsIncome Tax
    A Legal Dissection of Best Judgment Assessments in Tax Law, in the context of Sections 153A/153C in ...
❯❯
MaximizeMaximizeMaximize
0 / 200
Expand Note
Add to Folder

No Folders have been created

    +

    Are you sure you want to delete "My most important" ?

    NOTE:

    Notes
    Showing Results for :
    Reset Filters
    Results Found:
    Show All SummariesHide All Summaries
    Case LawsIncome Tax
    Show AI Summary
    Classification of property income: conversion into business income denies capital-gains relief and alters deduction eligibility.
    Where land initially held as a capital asset is developed and sold through partnership activity with a profit motive, the asset can be characterized as having undergone conversion into stock-in-trade and treated as business income; that characterization determines tax consequences by excluding capital-gains-specific deductions and reinvestment reliefs, and depends on the taxpayer's intention and the transactional pattern.
    Case LawsIncome Tax
    Show AI Summary
    Transfer pricing applicability to tonnage tax scheme narrowed; tonnage-covered operations exempted from transfer pricing obligations.
    Transfer pricing provisions were held inapplicable to operations covered by the Tonnage Tax Scheme, and transfer pricing adjustments based on differential interest for a bareboat charter cum demise lease were rejected in light of prior consistent rulings. The Tribunal treated the relevant interest income and expenditure as business income, examined whether a negative lien equated to a fee-bearing corporate guarantee, and reviewed allocation principles for common interest and hire-charge adjustments between tonnage and non-tonnage activities.
    Case LawsIncome Tax
    Show AI Summary
    Revisionary power under section 263 upholds reassessment where deduction eligibility under section 80IB(11A) is lacking.
    The PCIT found the assessee ineligible for the deduction under section 80IB because operations commenced outside the period in section 80IB(11A); the original assessment accepted the deduction without examining this eligibility. The PCIT issued a show-cause and, treating the original order as erroneous and prejudicial to revenue, exercised revisionary power under section 263 to quash the order and direct reassessment, the Tribunal upholding that revision was appropriate where the error was beyond mere rectification remedies.
    Case LawsCustoms
    Show AI Summary
    Proportionality in customs penalties: enhanced fines require adequate justification and consideration of compliance efforts by authorities.
    The legal issue concerns penalties under the provisional duty assessment regulations for delayed document submission; adjudicators must assess the limited nature of procedural lapses, consider compliance efforts where documents are produced during show cause proceedings, and apply proportionality principles. Enhanced penalties require adequate, reasoned justification, and adjudicators should determine whether a nominal penalty already imposed is commensurate with the lapse and its impact on finalizing provisional assessment and duty realization.
    Case LawsGST
    Show AI Summary
    Limitation exclusion for pandemic renders delayed ITC refund claims timely under CGST limitation provision, court applies notification.
    The court held that the pandemic period exclusion notification applies to computation of the limitation for refunds of unutilised Input Tax Credit arising from exports under a letter of undertaking. After assessing eligibility issues and time barred components of the ITC claim, the court found the appellate conclusion of limitation unsustainable and quashed the impugned order, applying the notification to the refund computation.
    Case LawsCentral Excise
    Show AI Summary
    CENVAT credit reversal: elective accounting options cannot be imposed on a taxpayer, limiting percentage-based recovery.
    Dispute concerns entitlement to reverse CENVAT credit when a manufacturer produces both dutiable and exempt goods without separate records. Rule 6(3) provides elective options for taxpayers not maintaining segregated accounts but authorities cannot impose those options on the assessee. Rule 14 and statutory recovery provisions allow recovery of wrongly availed credit, yet there is no statutory basis to mandate recovery by applying fixed percentages to the value of exempted goods; if the assessee has already reversed credit attributable to exempted production, additional percentage-based demands or penalties lack legal support.
    Case LawsIncome Tax
    Show AI Summary
    Perquisite valuation: absence of employer concession leads to no TDS on rent-free employee accommodation under valuation rules.
    The tribunal concluded that perquisite taxation on rent-free accommodation requires a demonstrable concession by the employer; in the absence of such concession the perquisite value is nil. Although the institution is not a Central Government entity, the Revenue's invocation of Rule 3 and fixed percentage valuation was premature. The appellate deletion of the withholding demand was affirmed on the ground that no concession existed and therefore no taxable perquisite arose.
    Case LawsIncome Tax
    Show AI Summary
    Unexplained investments deemed taxable where cancellation deeds lack civil adjudication and source credibility is unproven.
    The tribunal sustained income tax additions under the unexplained investment provision, holding that the assessee failed to prove the creditworthiness and reality of alleged fund sources for a land purchase revealed in a survey, and that registered cancellation deeds without a civil court decree do not legally negate the original transaction for tax purposes.
    Case LawsPMLA
    Show AI Summary
    Power to arrest under PMLA requires recorded reasons and limits general arrest notice requirements, affecting remand review.
    Power to arrest under the Prevention of Money Laundering Act requires strict recording and communication of reasons for arrest and operates through a specialized, self-contained mechanism limiting the applicability of certain general arrest notices. Judicial remand and CrPC procedures apply only to the extent they do not conflict with the PMLA; habeas corpus is available for illegal detention but is not ordinarily to be used to routinely challenge reasoned, statutorily compliant remand orders.
    Case LawsIncome Tax
    Show AI Summary
    Use or right to use: interconnect charges not treated as royalty under treaty because no transfer of use of IP.
    The core question was whether interconnect usage charges fall within royalty by virtue of conferring the use or right to use a process or equipment. The tribunal held that IUC did not amount to royalty because the telecommunications processes were standard industry practice, not proprietary or secret, and therefore did not grant a transferable right to exploit intellectual property; treaty interpretation under the DTAA controlled characterization.
    Case LawsVAT / Sales Tax
    Show AI Summary
    Priority of secured creditors affirmed over state tax claims under SARFAESI Act, reinforcing security interest protection in recoveries.
    The court's analysis centers on the statutory priority conferred by the SARFAESI framework for enforcement of security interests, treating secured creditors' lien-based rights as superior to government tax claims on the same charged asset and narrowing the traditional Crown Debt preference where the statutory enforcement regime specifies priorities.
    Case LawsGST
    Show AI Summary
    Seizure powers under GST limited to goods and material useful to proceedings, excluding currency and requiring necessity.
    The power to inspect, search and seize under Section 67 is confined to items believed to be liable for confiscation or material useful to proceedings; the statutory definition excludes money from 'goods', seizure must be necessary for GST proceedings, and items not relied upon in subsequent notice are to be returned within a limited period, reflecting a narrower interpretation of 'things' consistent with legislative intent.
    Case LawsIncome Tax
    Show AI Summary
    Principle of mutuality: interest on clubs' bank deposits treated as commercial income and not mutuality-exempt.
    The Court analysed whether investing clubs' surplus funds in bank fixed deposits preserved the identity between contributors and beneficiaries required by the Principle of Mutuality. It found that such investments diverted funds into commercial dealings with third parties and were not applied directly for members' mutual services, thereby breaking mutuality. As a result, interest earned on those investments did not qualify as exempt mutual receipts and was treated as taxable income.
    Case LawsService Tax
    Show AI Summary
    Extended limitation period: requires proof of fraud or wilful suppression; mere self-assessment errors are insufficient.
    The tribunal held that invocation of the extended period of limitation for recovery of irregularly availed CENVAT credit requires affirmative grounds such as fraud, collusion, wilful misstatement, or suppression of facts; mere incorrect self-assessment, audit disagreement, or discovery during audit does not establish the necessary intent to evade, and therefore demands beyond the normal limitation period (except conceded amounts) could not be sustained.
    Case LawsService Tax
    Show AI Summary
    Cenvat credit validity vs procedural lapses: extended limitation requires evidence of fraud or suppression to apply.
    Whether a PSU could claim CENVAT credit through its Head Office functioning as an Input Service Distributor despite documentation lapses, and whether the Department could invoke the extended period of limitation were examined. The focus is on reconciling substantive receipt of services with procedural compliance, and on the requisite showing of fraud, collusion, willful misstatement, or suppression of facts to justify extending limitation beyond the normal period; mere delay without such evidence does not suffice.
    Case LawsCustoms
    Show AI Summary
    Gold importation without declaration: whether undeclared imports amount to smuggling and bar redemption under customs law.
    The petitions question whether undeclared gold imports that bypass the Green Channel constitute prohibited goods or smuggling under the Customs Act, 1962, and whether adjudicating authorities properly exercised discretion under Section 125 in confiscating goods and denying redemption, given alleged arbitrariness and inconsistent treatment.
    Case LawsIndian Laws
    Show AI Summary
    Delay condonation in land acquisition appeals hinges on whether administrative impediments amount to sufficient cause.
    Delay condonation in land acquisition appeals hinges on whether administrative or bureaucratic impediments amount to a sufficient cause rather than an excuse; courts must assess explanations case-by-case, balancing procedural discipline against substantive justice while guarding against routine tolerance of government inefficiency.
    Case LawsGST
    Show AI Summary
    Input Tax Credit time-bar upheld: legislative limits on ITC claims are valid, treating ITC as a conditional concession.
    The time-limit for claiming Input Tax Credit (ITC) was upheld as a permissible legislative condition: ITC is a concession contingent on statutory requirements, temporal restrictions fall within legislative competence, and business forms like proprietorships cannot invoke trade-right protections in the same manner as citizens; judicial interference in fiscal policy is limited where statutory mechanisms govern tax benefits.
    Case LawsIncome Tax
    Show AI Summary
    Reassessment notice limitations restrict tax authorities when issued beyond limitation or without mandated approval or procedural defects.
    A reassessment issued after the three year limitation period and without approval from the specified authority fails statutory prerequisites and cannot sustain reassessment. Reassessment powers are limited to non disclosure or material misstatement of facts in the original assessment and do not extend to changes of opinion. TOLA 2020 does not expand substantive reassessment powers or alter approval requirements, and correct classification of expenses as capital or revenue remains central to tax consequence determinations.
    Case LawsIncome Tax
    Show AI Summary
    Best judgment assessment standards tightened when linked to search-and-seizure reassessments requiring documented satisfaction and DIN compliance.
    Best judgment assessment under Section 144 is examined alongside Sections 153A and 153C, stressing that invocation of Section 144 must be grounded in the legitimate scope opened by search-related reassessments. The court emphasises that the Assessing Officer's satisfaction note must be substantively supported, administrative formalities such as a Document Identification Number must be complied with, and that extensions of assessment periods require concrete evidentiary justification.

    TMI Notes

    Back

    All TMI Notes

    Showing Results for :
    Reset Filters
      No Records Found

      TMI Notes

      Back

      All TMI Notes

      whatsappJoin Channel
      Showing Results for : Reset Filters

      Comparison of Section 209 "Tax on income from bonds or Global Depository Receipts purchased in foreign currency or capital gains arising from their transfer." between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)

      5 September, 2025

      Contents
      Acts
      Rules & Regulations
      Summary
      Note

      Note

      -

      Bookmark

      Print

      Print

      Section 209 Tax on income from bonds or Global Depository Receipts purchased in foreign currency or capital gains arising from their transfer.

      Income-tax Act, 2025

      At a Glance

      These documents reproduce Clause 209 of the Income Tax Bill, 2025 (Old Version) and Section 209 of the Income-tax Act, 2025 as enacted. Both provisions impose special tax treatment for non-residents on income from certain bonds and Global Depository Receipts (GDRs) purchased in foreign currency and on capital gains arising on their transfer. The changes between the Bill and the enacted Section are primarily textual, reference-based and procedural in nature; they affect computation wording, cross-references to other sections, and a minor definitional cross-reference. Affected parties: non-resident investors, financial intermediaries (approved intermediaries), Indian issuing companies and tax administration. Effective date or enactment date: Not stated in the document.

      Background & Scope

      Statutory hook: Clause/Section 209, appearing in the Income Tax Bill, 2025 (old version) and in the Income-tax Act, 2025 respectively. The provision is located within the special provisions relating to non-residents and foreign companies. The text covers income from (i) interest on specified bonds issued by Indian companies or public sector companies and purchased in foreign currency; (ii) dividends on Global Depository Receipts acquired in foreign currency through an approved intermediary; and (iii) long-term capital gains on transfer of those bonds or GDRs. The enacted section also contains procedural provisions governing deductions, returns, and certain transitional/amalgamation situations. Definitions provided in the enacted section include 'approved intermediary' (as per a Central Government-notified scheme) and a cross-reference defining 'Global Depository Receipts' (section 193(4)(a) in the Act). The Bill version contains similar material but uses a different cross-reference for GDRs (section 190(4)(a)).

      Statutory Provision Mode

      Text & Scope

      The provision applies to an assessee who is a non-resident and whose total income includes any of the incomes specified in the statutory Table. The Table enumerates four entries:

      • Interest on (a) bonds of an Indian company issued under a Central Government notified scheme, or (b) bonds of a public sector company sold by the Government, when purchased in foreign currency - taxed at 10%.
      • Dividends on Global Depository Receipts - where the GDRs are issued/re-issued under notified schemes and purchased in foreign currency through an approved intermediary - taxed at 10%.
      • Long-term capital gains on transfer of the bonds or GDRs referred to above - taxed at 12.5%.
      • The remainder: total income as reduced by the incomes in items 1-3 - in the enacted section described as "Rates in force"; in the Bill as "Income-tax chargeable on such income."

      Interpretation

      The enacted text frames the tax liability of a non-resident as "the aggregate of income-tax computed at the rate specified in column C applied on the corresponding income specified in column B." This language emphasises a rate-applied computation for each head listed. The Bill phrasing (aggregate of the amounts mentioned in column C) is functionally similar but less explicit about the computation methodology. The enacted provision also expressly excludes application of section 72(6) for computation of long-term capital gains on these specified assets.

      Exceptions/Provisos

      Several limiting or procedural provisions are present:

      • Where a non-resident's gross total income consists only of interest and/or dividends as specified (items 1 and 2), no deductions are allowed under enumerated provisions (enacted section cites sections 28 to 58, 60 and 61; Bill cited sections 26 to 61).
      • Where the gross total income includes any of items 1-3, the gross total income is to be reduced by such income and deductions under Chapter VIII are to be allowed as if the reduced gross total income were the gross total income of the assessee.
      • A non-resident need not furnish a return u/s 263(1) if total income in the year consisted only of the interest/dividend incomes in items 1-2 and tax was deducted at source under Chapter XIX-B.
      • Transitional/amalgamation rule: where GDRs or bonds are acquired by an assessee in an amalgamated or resulting company by virtue of holding such instruments in the amalgamating or demerged company, the same provisions apply to such GDRs or bonds.

      Illustrations

      • Example 1: A non-resident holds interest-bearing bonds of an Indian company purchased in foreign currency and receives interest of X in the year. The interest is taxed at 10% under item 1. Not stated in the document whether grossing up, surcharges or cesses apply beyond the stated rate.
      • Example 2: A non-resident sells long-term GDRs (acquired in foreign currency through an approved intermediary) and realises capital gain Y. The long-term capital gain is taxed at 12.5% as per item 3. Not stated in the document whether indexation or specific computation method for capital gain is modified beyond the exclusion of section 72(6).

      Interplay

      The enacted section cross-references other statutory provisions: Chapters and sections governing deductions (Sections 28-58, 60, 61), Chapter VIII deductions, section 72(6) (specifically excluded), the return filing provision referenced (section 263(1) in the texts), Chapter XIX-B (TDS provisions) and the definition of GDRs (section 193(4)(a) in the Act text; Bill referenced section 190(4)(a)). The documents do not reproduce the content of those cross-referenced provisions; therefore detailed interaction mechanics are Not stated in the document.

      Differences between the Clause 209 of the Income Tax Bill, 2025 (Old Version) and Section 209 of the Income-tax Act, 2025

      TopicBill (Clause 209 Old Version)Enacted Section 209Practical impact
      Computation wording"aggregate of the amounts mentioned in column C thereof.""aggregate of income-tax computed at the rate specified in the column C applied on the corresponding income specified in column B."clearer computational method in the enacted text ensuring rates are applied to corresponding income heads rather than potentially interpreted as flat sums.
      Residual income wording (Table item 4)"Income-tax chargeable on such income.""Rates in force."enacted text signals application of prevailing tax rates to the residual income; the Bill phrase might have invited alternative interpretations of chargeability. Exact fiscal consequences Not stated in the document.
      Cross-references to deduction sectionsExcludes deductions u/ss 26 to 61 (and certain sub-clauses) and under Chapter VIII.Excludes deductions u/ss 28 to 58, 60 and 61 (and certain sub-clauses) and under Chapter VIII.the enacted text alters the catalogue of excluded deduction sections; which specific deductions are affected is Not stated in the document.
      Definition cross-reference for "Global Depository Receipts"Cross-refers to section 190(4)(a).Cross-refers to section 193(4)(a).depends on the substantive definitions in those sections-Not stated in the document.
      Minor drafting/typo correctionsContains editorial notes/corrections in the Bill (e.g., "as per with" corrected to "as per").Polished enacted language ("as may be notified by the Central Government").reduces ambiguity; no substantive policy change apparent from document.

      Practical Implications

      • Compliance and risk areas: Non-resident taxpayers receiving the enumerated incomes must ensure correct application of the specified rates (10% for interest/dividend; 12.5% for long-term capital gains) and must verify whether their gross total income consists solely of those heads to determine deductibility limits and return filing obligations. The enacted text's explicit computation language reduces ambiguity when computing aggregate tax on the heads in the Table.
      • Record-keeping/evidence points: The provision emphasises acquisition "in foreign currency" and purchase "through an approved intermediary" for GDRs; therefore investors and intermediaries should retain evidence of currency of purchase and intermediary approval status under a Central Government-notified scheme. Not stated in the document are the particulars of the scheme or the certification/documentation required by the approved intermediary; those details are Not stated in the document.

      Key Takeaways

      • Both texts impose special fixed rates for non-residents on interest (10%), dividends on GDRs (10%) and long-term capital gains on transfer of such assets (12.5%).
      • The enacted section clarifies computation language - "income-tax computed at the rate specified" - whereas the Bill used a less explicit phrase "aggregate of the amounts mentioned". Practical effect: clearer computational instruction in the enacted text.
      • Cross-reference differences: enacted section cites deduction sections as 28-58, 60 and 61; the Bill cited 26-61. This narrows the list of excluded deductions in the enacted text relative to the Bill; practical impact depends on which specific provisions were moved/excluded (details Not stated in the document).
      • The enacted section uses a different cross-reference for the statutory definition of "Global Depository Receipts" (section 193(4)(a)) versus the Bill's section 190(4)(a). The practical significance depends on the definitions in those sections (Not stated in the document).
      • The enacted provision replaces the Bill's phrase "Income-tax chargeable on such income" for the residual income with "Rates in force", which suggests that the balance of income will be taxed under prevailing rates rather than by reference to a specific computation language in the Table. The exact fiscal effect is Not stated in the document.
      • Procedural provisions on returns and applicability on amalgamation are retained in substance; they require documentary corroboration for threshold compliance (Not stated in the document as to the precise documentary standards).

      Full Text:

      Section 209 Tax on income from bonds or Global Depository Receipts purchased in foreign currency or capital gains arising from their transfer.

      Topics

      ActsIncome Tax