CHAPTER III
DIRECT TAXES
Income-tax
Amendment of section 44BB.
16. In section 44BB of the Income-tax Act, in the proviso to sub-section (1), after the words, figures and letter "section 44D or", the words, figures and letters "section 44DA or" shall be inserted with effect from the 1st day of April, 2011.
Notes on Clauses:
Clause 16 of the Bill seeks to amend section 44BB of the Income tax Act relating to special provision for computing profits and gains in connection with the business of exploration, etc., of mineral oils.
Under the existing provisions contained in sub-section (1) of the aforesaid section, income of a non-resident assessee who is engaged in the business of providing services or facilities in connection with, or supplying plant and machinery on hire used, or to be used, in the prospecting for, or extraction or production of, mineral oils is computed at ten per cent. of the aggregate of the amounts paid or payable to the assessee or to any person on his behalf, whether in or out of India on account of the provisions of such services and facilities. The proviso to the said sub-section provides that the said sub-section shall not apply in a case where the provisions of section 42 or section 44D or section 115A or section 293A apply for the purposes of computing profits or gains or any other income referred to in those sections.
It is proposed to insert the reference of "section 44DA" in the proviso to the said sub-section (1) so as to clarify that the provisions of section 44BB shall also not apply in case where the provisions of section 44DA become applicable.
This amendment will take effect from 1st April, 2011, and will, accordingly, apply in relation to assessment year 2011-2012 and subsequent years.
