Amendment of section 90.
31. In section 90 of the Income-tax Act,—
(a) after sub-section (2), the following sub-section shall be inserted with effect from the 1st day of April, 2013, namely:—
“(2A) Notwithstanding anything contained in sub-section (2), the provisions of Chapter X-A of the Act shall apply to the assessee, even if such provisions are not beneficial to him.”;
(b) after sub-section (3) and before Explanation 1, the following sub-section shall be inserted with effect from the 1st day of April, 2013, namely:—
“(4) An assessee, not being a resident, to whom an agreement referred to in sub-section (1) applies, shall not be entitled to claim any relief under such agreement unless a certificate, containing such particulars as may be prescribed, of his being a resident in any country outside India or specified territory outside India, as the case may be, is obtained by him from the Government of that country or specified territory.”;
(c) after Explanation 2, the following Explanation shall be inserted and shall be deemed to have been inserted with effect from the 1st day of October, 2009, namely:––
“Explanation 3.––For the removal of doubts, it is hereby declared that where any term is used in any agreement entered into under sub-section (1) and not defined under the said agreement or the Act, but is assigned a meaning to it in the notification issued under sub-section (3) and the notification issued thereunder being in force, then, the meaning assigned to such term shall be deemed to have effect from the date on which the said agreement came into force.”;
Notes on Clauses:
Clause 31 of the Bill seeks to amend section 90 of the Income-tax Act relating to agreement with foreign countries or specified territories.
The existing provisions of the aforesaid section 90 confers power upon the Central Government to enter into agreement with the Government of any specified territory outside India in addition to entering into agreement with foreign countries.
It is proposed to insert a new sub-section (2A) in the aforesaid section 90 so as to provide that the provisions of newly inserted Chapter X-A shall apply even if such provisions are not beneficial to the assessee.
It is further proposed to insert a new sub-section (4) in the aforesaid section so as to provide that an assessee, not being a resident, to whom an agreement referred to in sub-section (1) applies, shall not be entitled to claim any relief under such agreement unless a certificate, containing prescribed particulars, of his being a resident in any country outside India or specified territory outside India, as the case may be, is obtained by him from the Government of that country or specified territory.
These amendments will take effect from 1st April, 2013 and will, accordingly, apply in relation to assessment year 2013-2014 and subsequent assessment years.
The existing sub-section (3) of the aforesaid section provides that any term used but not defined in this Act or in the agreement referred to in sub-section (1) shall, unless the context otherwise requires, and is not inconsistent with the provisions of this Act or the agreement, have the same meaning as assigned to it in the notification issued by the Central Government in the Official Gazette in this behalf.
It is proposed to insert an Explanation after Explanation 2 in the aforesaid section so as to provide that for the removal of doubts, it is hereby declared that where any term is used in any agreement entered into under sub-section (1) and not defined in the agreement or the Act, but is assigned a meaning to it in the notification issued under sub-section (3) and such notification issued thereunder being in force, then, the meaning assigned to such term shall be deemed to have effect from the date on which the said agreement came into force.
This amendment will take effect retrospectively from 1st October, 2009.
