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    AMENDMENTS IN THE CUSTOMS TARIFF ACT 1975
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    NewsBills
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    Safeguard measures expanded to permit duties or tariff rate quotas when increased imports threaten domestic industry.
    The substituted Section 8B empowers the Central Government to apply safeguard measures-including imposition of a Safeguard Duty, application of a Tariff Rate Quota, or any other appropriate measure-when increased imports of an article cause or threaten to cause serious injury to domestic industry, centralising authority to identify qualifying import patterns and to select proportional remedial instruments.
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    Preferential tariff verification: suspension of duty concessions pending exporter verification and security requirement for import clearance.
    New Chapter VAA (section 28DA) creates a framework for preferential tariff treatment under trade agreements, imposes importer obligations and requires time bound verification from the exporting country; preferential treatment may be suspended pending verification with clearance only on furnishing security equal to the differential duty, and may be denied in certain cases. Section 51B establishes an Electronic Duty Credit Ledger for duty credits in lieu of remission and extends recovery provisions to such credits. Amendments also add confiscation liability for contraventions of preferential claims and empower rulemaking under sections 156 and 157; an explanation preserves pre 2018 notices under section 28.
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    Verification of Returns: prescribed persons may verify company and LLP returns and act as authorised representatives.
    Amendments allow any person prescribed by the Board to verify the income-tax return of a company or LLP and permit any person prescribed by the Board to appear as an authorised representative on behalf of an assessee, supplementing existing verification and representation rules that currently designate managing directors, directors, insolvency professionals, designated partners or partners.
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    Cost of acquisition for segregated portfolio units: holding period continuity and proportional NAV-based allocation determine tax basis.
    Units in a segregated portfolio inherit the holding period of the original units in the main portfolio, and the cost of acquisition of segregated portfolio units is the portion of the original cost proportionate to the ratio of the NAV of assets transferred to the segregated portfolio to the NAV of the total portfolio immediately before segregation; the cost of the original units in the main portfolio is deemed reduced by that allocated amount.
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    Annual financial statement upload expands tax-statement data in assessees' accounts, aiding compliance and accurate return filing.
    The administering income-tax authority, or its authorised person, will be required to upload an Annual Financial Statement to the assessee's registered account on the designated portal, in such form, manner and within such time as may be prescribed, containing financial information in the possession of the authority (including items beyond tax deducted or collected). The existing provision specifically governing the prior tax-deduction statement is proposed to be deleted and the amendment takes effect from 1st June, 2020.
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    Tax audit threshold increase for low-cash businesses; tax audit reports must be furnished earlier to enable return pre-filling.
    The proposal raises the audit exemption threshold for businesses where both aggregate cash receipts and aggregate cash payments do not exceed five percent of totals; it mandates that tax audit reports for business or professional income be furnished at least one month before the return filing due date to enable pre-filling, and it amends return due dates and partner treatment while making consequential TDS/TCS amendments to align withholding references with the revised audit framework.
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    Eligibility expansion for Adjudicating Authority members adds District Judge qualification, broadening appointment pool under Benami Property law.
    Section 9 eligibility for appointment as a Member of the Adjudicating Authority under the Prohibition of Benami Property Transaction Act is expanded to include persons who are qualified for appointment as District Judge, in addition to existing eligibility for Indian Revenue Service officers who have held Commissioner of Income-tax (or equivalent) and Indian Legal Service officers who have held Joint Secretary (or equivalent). The amendment takes effect from 1 April 2020 under Clause 143 of the Finance Bill.
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    Donation reporting: donees must file statements and issue certificates before donor deduction claims are allowed under tax law.
    Entities receiving donations must furnish a standardized statement of donations and issue certificates to donors; donor deduction claims will be permitted only where the donee has filed the prescribed statement, with fees and penalties for non compliance. Approvals and registrations under charitable exemption provisions will be time limited and may be granted provisionally on application without detailed enquiry, with requirements to reapply to reactivate inoperative registrations.
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    Time-limited exemptions: periodic renewal of registrations to ensure compliance and reduce intrusive inquiries.
    Modernise and streamline the process for grant of registration and approval for tax-exempt entities by using technology, and institute time-limited, renewable exemptions to ensure ongoing compliance while reducing intrusive day-to-day inquiries; the reform would apply to both existing and new exempt entities.
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    Exemption switching for registered charitable entities allowed once to obtain statutory notification, preserving single-mode compliance and admin efficiency.
    Amendment permits registered charitable entities to seek notification under the statutory exemption for bodies created by Central or State enactment, correcting an anomaly that denied such notification to entities holding registration. It retains the complete-code principle requiring compliance with registration conditions, but allows a one-time switch to the notified exemption while ensuring only one mode of exemption is operative and limiting routine switching for administrative efficiency.
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    Stamp duty cap on fair market value for land and buildings limits FMV to stamp duty value where available.
    For land or building assets, the fair market value on the reference date for computing cost of acquisition shall not exceed the stamp duty value where such stamp duty value is available; "stamp duty value" means the value adopted, assessed or assessable by any Central or State authority for stamp duty purposes.
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    Taxation of dividends shifts to shareholders, abolishing payer-level tax and imposing withholding and limited deductions under transitional rules.
    Removal of Dividend Distribution Tax and return to a classical system makes dividend and income from units taxable in the hands of shareholders and unit holders at their applicable rates, removes payer-level additional tax and related exemptions, limits deductions against such income to interest expense capped at twenty per cent, reallocates taxability for business trusts and interposed vehicles to unit holders, and introduces expanded withholding obligations and transitional rules phasing out payer-level taxation.
    NewsBills
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    Significant Economic Presence deferred while source rules target India-directed digital ad and data revenue for taxation.
    The proposal defers the Significant Economic Presence concept until 1 April 2022 (applicable AY 2022-23), pending threshold rules; clarifies that India-sourced income includes advertising targeted at Indian customers and sale of India-collected data (effective 1 April 2021), aligns the indirect transfer exception for investments by foreign portfolio investors with SEBI's revised FPI regulations (effective 1 April 2020), expands the definition of royalty to include receipts from sale/distribution/exhibition of cinematographic films (effective 1 April 2021), and empowers the Board to prescribe income attribution rules under section 295 with staggered effective dates.
    NewsBills
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    Treaty anti abuse preamble aligns DTAA purpose with MLI to prevent treaty shopping via statutory amendment.
    The proposal amends the statutory power to enter into DTAAs so that agreements for the avoidance of double taxation must be made without creating opportunities for non taxation or reduced taxation through tax evasion or avoidance, including treaty shopping arrangements aimed at indirect benefit of residents of other jurisdictions, thereby implementing the MLI's anti abuse preamble into domestic treaty making authority.
    NewsBills
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    Penalty for false invoices: levy equals aggregate false or omitted entries and also targets those who cause them.
    A new provision proposes a penalty for false entries under GST where penalty equals the aggregate amount of false or omitted entries used to evade tax; liability extends to persons who cause such entries. "False entries" include forged or falsified documents, invoices without actual supply or receipt of goods or services, and invoices involving non existent persons. The amendment is intended to deter fraudulent ITC claims and takes effect from the fiscal implementation date in the Finance Bill.
    NewsBills
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    Contract manufacturing classification: raw materials supplied by assessee or associate treated as work under section 194C, preventing tax avoidance.
    Amendment treats contract manufacturing where raw material is provided by the assessee or its associate as work under section 194C, closing a compliance gap exploited by sourcing materials through related parties, and defines "associate" by reference to the relational test in clause (b) of sub section (2) of section 40A.
    NewsBills
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    Tax residency thresholds tightened: visit exemption reduced, not ordinarily resident test tightened and deeming rule for citizens without foreign tax liability.
    The proposal reduces the special visit exemption for Indian citizens and persons of Indian origin so shorter periods of presence in India count towards residency; replaces the existing multi-part test for not ordinarily resident status with a single prior non-residence stability test; and deems an Indian citizen who is not liable to tax in any other jurisdiction to be resident in India, aimed at preventing arrangements that result in global non taxation.
    NewsBills
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    Taxpayer's Charter empowers the tax board to adopt a charter and issue directions and guidelines to tax authorities for administration.
    Insertion of section 119A empowers the Board to adopt and declare a Taxpayer's Charter and to issue orders, instructions, directions or guidelines to other income tax authorities for administration of the Charter, with the amendment taking effect from 1st April, 2020.
    NewsBills
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    E-penalty scheme to digitalise penalty proceedings, remove in-person AO interface and enable dynamic jurisdiction in penalty imposition.
    A proposed amendment would insert a sub-section empowering the Central Government to notify an e-penalty scheme to digitalise penalty proceedings, remove in-person interface between Assessing Officers and assessees insofar as technologically feasible, optimise resources by centralised speciality, and provide for penalties to be imposed under a dynamic jurisdiction model by one or more income-tax authorities; the Government may notify exceptions or adaptations to existing jurisdictional and procedural provisions and must lay notifications before Parliament.
    NewsBills
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    Stay conditions for appeals: security deposit requirement limits extensions and total stay period before tribunal under tax law.
    The ITAT may grant a stay only if the assessee deposits or furnishes security equal to a prescribed proportion of the tax, interest, fee, penalty or other sums; extensions of stay are available only on application showing delay not attributable to the assessee and upon compliance with the deposit/security condition, and the total period of stay is subject to an overall statutory cap. Effective from 1 April 2020.

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      Review of concessional rates of BCD prescribed in notification no. 50/2017 - Customs dated 30.62017: The BCD exemption hitherto available on certain goods are being withdrawn by omitting following entries of notification No. 50/2017-Customs dated 30.6.2017.

      3 February, 2020

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      Budget 2020-21 + FINANCE BILL, 2020

      S. No.

      S. No. of Notification No 50/2017-customs

      Description

      1.

      5

      Tuna bait [0303]

      2.

      7

      Goods upto an aggregate of ten thousand metric tonnes of total imports of Milk and cream, in powder, granules or other solid form in a financial year. [0402 10, 0402 21 00]

      3.

      7A

      Whey, concentrated, evaporated or condensed, liquid or semi-solid [0404 10 10]

      4.

      7B

      Other Whey [0404 90 00)

      5.

      8

      Butter Ghee, Butter Oil [0405]

      6.

      9

      Other cheese [0406 90 00)

      7.

      10

      Pancreas (Products of animal origin, not elsewhere specified) (Chapter 5]

      8.

      11

      Conch shell [0508 00]

      9.

      18

      Bulbs or tubers, other live plants [0601 or 0602]

      10.

      36

      All goods other than meslin or wheat [1001]

      11.

      38

      Meslin [1001]

      12.

      40

      Maize upto an aggregate of five lakh metric tonnes of total imports of such goods in a financial year [1005 90]

      13.

      47

      Sugar beet seeds [1209 10 00)

      14.

      56

      Edible oils [1508, 1512, 1513, 1514, 1515 or 1511 10]

      15.

      58

      Refined vegetable oils of edible grade, in loose or bulk form (other than palm oil) [chapter 15]

      16.

      59

      Vegetable oils of edible grade, in loose or bulk form (other than those specified against S. No. 58 and palm oil), imported for the manufacture of oil commonly known as “Vanaspati” or for refining.

      Explanation. -The expression “Vegetable oil” means-

      (a) in the case of cottonseed oil, oil having a free fatty acid content of at least 0.2%; and

      (b) in the case of any other vegetable oil. oil with free fatty acid content of at least 0.5%. [15]

      17.

      68

      Crude sunflower seed or safflower oil upto an aggregate of one lakh and fifty thousand metric tonnes of total imports of such goods in a financial year [1512 11]

      18.

      69

      Crude sunflower seed or safflower oil other than those specified against S. No. 68 [1512 11]

      19.

      72

      Refined rape, colza or mustard oil upto an aggregate of one lakh and fifty thousand metric tonnes of total imports of such goods in a financial year (1514 19 or 1514 99]

      20.

      78

      Margarine, animal or vegetable oils of edible grade [1517 or 1518]

      21.

      83

      Glycerol, crude; glycerol waters and glycerol lyes, (other than crude glycerin) [1520 00 00]

      22.

      88A

      Raw Sugar upto an aggregate of three lakh metric tonnes of total imports of such goods. Provided that the import of raw sugar in physical form is completed within sixty (60) days from the date of issue Of the Tariff Rate Quota Allocation Certificate or license by Directorate General of Foreign Trade (DGFT) to the importer. Provided further that the importer shall convert the raw sugar into white/ refined sugar within a period, not exceeding thirty (30) days, from the date of filing of bill of entry or the date of entry inwards, whichever is later [1701]

      23.

      89

      Dextrose Monohydrate [1702)

      24.

      92

      Molasses resulting from extraction or refining of sugar [1703]

      25.

      93

      Chewing gum whether or not sugar coated [1704 10 00]

      26.

      94

      Food preparations, for infant use and put up for retail sale, of-

      (i) goods of headings 0401 to 0404, containing cocoa calculated on a totally defatted basis, in a proportion by weight of 5% or more but less than 10%; or

      (ii) flour, meal, starch or malt extract containing cocoa calculated on a totally defatted basis, in a proportion by weight of 40% or more but less than 50% [1806 90)

      27.

      95

      Preparations for infant use put up for retail sale [1901 10]

      28.

      98

      preserved potatoes [2004 10 00]

      29.

      99

      Peanut Butter [2008 11 00]

      30.

      105

      Wine, for use as sacramental wine [22]

      31.

      108

      Angostura bitters [2208]

      32.

      113

      Fin fish feed [2301 20, 2309 90 32, 2309 90 39]

      33.

      115

      Dietary soya fibre [2304]

      34.

      148

      Naphtha, when imported by Ratnagiri Gas and Power Private Limited (RGPPL), for use in generation of electricity in the power plants of Ratnagiri Gas and Power Private Limited (RGPPL) at Dabhol, District Ratnagiri, Maharashtra [2710]

      35.

      149

      Naphtha, when imported for generation of electrical energy by a generating company as defined in section 2(28) of the Electricity Act, 2003 (36 of 2003) to supply electrical energy-or to engage in the business of supplying electrical energy [2701]

      36.

      152

      Propane, Butane [2711 12 00, 2711 13 00]

      37.

      160

      Electrical energy [ 2716 00 00]

      38.

      170

      Phosphoric acid, for the manufacture of fertilizers(28]

      39.

      212

      Japanese Encephalitis (JE) vaccine, imported by the Andhra Pradesh Government through UNICEF [30]

      40.

      220

      Kyanite salts, in a form indicative of their use for manurial purpose [31]

      41.

      243

      Isolated soya protein [3504]

      42.

      244

      Colour positive unexposed cinematographic film in jumbo rolls and colour negative unexposed cinematographic film in rolls of 400 feet and 1000 feet [37]

      43.

      245

      Instant print film [3701 20 00 or 3702]

      44.

      246

      Cinematographic films, exposed but not developed [3704]

      45.

      247

      Promotional material (like Trailers, making of film etc.) imported in the form of electronic promotion kits (EPK)/ beta cams (Any Chapter)

      46.

      263

      The following polymers of ethylene, namely: -

      (i) Cow density polyethylene (LDPE),

      (ii) Linear low-density polyethylene (LLDPE),

      (iii) High density polyethylene (HDPE),

      (iv) Linear medium density polyethylene (LMDPE),

      (v) Linear high-density polyethylene (LHDPE) [3901]

      47.

      264

      All goods other than poly 'so-butylene [39021

      48.

      266

      All goods [3903]

      49.

      274

      Compostable polymer or bio-plastic used in the manufacture of bio degradable agro mulching films, nursery plantation pots and flower pots [3913 90 90]

      50.

      275

      Water blocking tape for use in the manufacture of insulated Wires and cables falling under heading 8544 (except sub-heading 8544 11) [3919 90 90]

      51.

      278

      Subbed polyester base, imported by M/s. Hindustan Photo Films Manufacturing Company Limited, Udhagamandalam for the manufacture of medical or industrial X-ray films and graphic art films [39201

      52.

      286

      Patent leather [4114 20 10]

      53.

      287

      Raw furskins [4301). tanned and dried furskins [4302]

      54.

      386

      Lead bars. rods. profiles and wire [7806]

      55.

      388

      Zinc tubes, pipes and tube or pipe fittings [7907]

      56.

      389

      Tin plates, sheets and strip, of a thickness exceeding 0.2 mm; tin foil (whether or not printed or backed with paper, paperboard, plastics or similar backing materials), of a thickness (excluding any backing) not exceeding 0.2 mm; tin powders and flakes [8007]

      57.

      398

      Parts and components of the goods specified in List 10 required for use in high voltage power transmission project (Any chapter]

      58.

      401

      All items of equipment including machinery and rolling stock, procured by or on behalf of Delhi Metro Rail Corporation Ltd. for use in-

      (i) Delhi MRTS Project Phase-I, and

      (ii) Specified corridors of Delhi MRTS Project Phase-Il, comprising of the following, namely: -

      (a) Vishwavidyalaya- Jahangirpuri;

      (b) Central Secretariat-Qutab Minar (via All India Institute of Medical Sciences);

      (c) Shahdara- Dilshad Garden;

      (d) Indraprastha-New Ashok Nagar;

      (e) Yamuna Bank-Anand Vihar-lnter State Bus Terminus; and

      (f) Kirti Nagar-Mundka (along with operational Link to Shahdara- Rithala corridor) (Any Chapter)

      59.

      412

      Goods specified in List 15 required for construction of roads [84 or any other chapter]

      60.

      447

      The following goods required for manufacture of Optical disk drives (ODD), namely: -

      (i) Pick up assembly

      (ii) Digital signature procession integrated circuit

      (iii) DC motor

      (iv) LDO voltage regulator [84 or Any other Chapter]

      61.

      456

      The following goods, namely: -

      (a) Sprinklers and drip irrigation systems for agricultural and horticultural purposes;

      (b) Micro Irrigation equipment [8424]

      62.

      457

      Poultry incubators and brooders [8436 21 00]

      63.

      459

      Parts for manufacture of printers falling under sub heading 8443 32 (except 8443 99 51, 8443 99 52, 8443 99 53) [8443]

      64.

      465

      CD -Writers (8471]

      65.

      474

      MP3 or MP4 or MPEG 4 player with or without radio or video reception facility [85]

      66.

      483

      One set of pre-recorded cassettes accompanying books for learning languages and essential complement to such books, [85]

      67.

      484

      Audio cassettes, if recorded with material from books, newspaper or magazines, for the blind [85]

      68.

      515

      Colour television picture tubes for use in the manufacture of cathode ray televisions [8540 11]

       

       


      Full Text:

      Budget 2020-21 + FINANCE BILL, 2020

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      ActsIncome Tax