17. In section 115JB of the Income-tax Act, with effect from the 1st day of April, 2012,—
(i) in sub-section (1),—
(a) for the words, figures and letters "the 1st day of April, 2011", the words, figures and letters "the 1st day of April, 2012" shall be substituted;
(b) for the words "eighteen per cent.", at both the places where they occur, the words "eighteenand one-half per cent." shall be substituted;
(ii) in sub-section (6) [as so inserted by the Special Economic Zones Act, 2005], (28 of 2005). The following proviso shall be inserted, namely:—
"Provided that the provisions of this sub-section shall cease to have effect in respect of any previous year relevant to the assessment year commencing on or after the 1st day of April, 2012.".
Notes on Clauses:
Clause 17 of the Bill seeks to amend section 115JB of the Income-tax Act relating to special provision for payment of tax by certain companies.
The existing provisions contained in sub-section (1) of the aforesaid section provide that in case of a company, if the tax payable on the total income as computed under the Income-tax Act in respect of any previous year relevant to the assessment year commencing on or after the 1st day of April, 2011, is less than eighteen per cent. of its book profit, such book profit shall be deemed to be the total income of the assessee and the tax payable for the relevant previous year shall be eighteen per cent. of such book profit.
It is proposed to amend sub-section (1) of the aforesaid section to provide that if the income-tax payable on the total income as computed under the Income-tax Act in respect of any previous year relevant to the assessment year commencing on or after the 1st day of April, 2012 is less than eighteen and one-half per cent. of its book profit, such book profit shall be deemed to be the total income of the assessee and the tax payable for the relevant previous year shall be eighteen and one-half per cent. of such book profit.
Sub-section (6) of section 115JB of the Income-tax Act was inserted in that section by way of a modification vide section 27 of the Special Economic Zones Act, 2005 read with the Second Schedule thereof.
The existing provisions contained in the aforesaid sub-section
(6) provide that the provisions of section 115JB shall not apply to the income accrued or arising on or after the 1stday of April, 2005 from any business carried on, or services rendered, by an entrepreneur or a Developer, in a Unit or Special Economic Zone, as the case may be.
It is proposed to insert a proviso to the said sub-section (6) so as to provide that the provisions of that sub-section shall cease to have effect in respect of any previous year relevant to the assessment year commencing on or after the 1st day of April, 2012.
These amendments will take effect from 1st April, 2012 and will, accordingly, apply in relation to the assessment year 2012-2013 and subsequent years.
