Amendment of section 206C.
79. In section 206C of the Income-tax Act, with effect from the 1st day of July, 2012,—
(a) in sub-section (1), in the Table, after serial number (vi) and the entries relating thereto, the following serial number and entries shall be inserted, namely:—
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Sl.No.
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Nature of goods
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Percentage
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(1)
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(2)
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(3)
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“(vii)
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Minerals, being coal or lignite or iron ore
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one per cent:”;
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(b) after sub-section (1C), the following sub-section shall be inserted, namely:—
“(1D) Every person, being a seller, who receives any amount in cash as consideration for sale of bullion or jewellery, shall, at the time of receipt of such amount in cash, collect from the buyer, a sum equal to one per cent. of sale consideration as income-tax, if the sale consideration exceeds two hundred thousand rupees.”;
(c) in sub-section (2), after the words, brackets, figure and letter “or sub-section (1C)”, the words, brackets, figure and letter “or sub-section (1D)” shall be inserted;
(d) in sub-section (3), after the words, brackets, figure and letter “or sub-section (1C)”, the words, brackets, figure and letter “or sub-section (1D)” shall be inserted;
(e) in sub-section (6A),—
(A) before the proviso, the following proviso shall be inserted, namely:—
“Provided that any person, other than a person referred to in sub-section (1D), responsible for collecting tax in accordance with the provisions of this section, who fails to collect the whole or any part of the tax on the amount received from a buyer or licensee or lessee or on the amount debited to the account of the buyer or licensee or lessee shall not be deemed to be an assessee in default in respect of such tax if such buyer or licensee or lessee—
(i) has furnished his return of income under section 139;
(ii) has taken into account such amount for computing income in such return of income; and
(iii) has paid the tax due on the income declared by him in such return of income, and the person furnishes a certificate to this effect from an accountant in such form as may be prescribed:”;
(B) in the proviso, for the words “Provided that”, the words “Provided further that” shall be substituted;
(f) in sub-section (7), the following proviso shall be inserted, namely:—
“Provided that in case any person, other than a person referred to in sub-section (1D), responsible for collecting tax in accordance with the provisions of this section, fails to collect the whole or any part of the tax on the amount received from a buyer or licensee or lessee or on the amount debited to the account of the buyer or licensee or lessee but is not deemed to be an assessee in default under the first proviso of sub-section (6A), the interest shall be payable from the date on which such tax was collectible to the date of furnishing of return of income by such buyer or licensee or lessee.”;
(g) in sub-section (9), after the words, brackets, figure and letter “or sub-section (1C)” at both the places where they occur, the words, brackets, figure and letter “or sub-section (1D)” shall be inserted;
(h) in the Explanation, occurring at the end,—
(I) for clause (a), the following clauses shall be substituted, namely:—
(a) “accountant” shall have the meaning assigned to it in the Explanation to sub-section (2) of section 288;
(aa) “buyer” with respect to—
(i) sub-section (1) means a person who obtains in any sale, by way of auction, tender or any other mode, goods of the nature specified in the Table in sub-section (1) or the right to receive any such goods but does not include,—
(A) a public sector company, the Central Government, a State Government, and an embassy, a High Commission, legation, commission, consulate and the trade representation, of a foreign State and a club; or
(B) a buyer in the retail sale of such goods purchased by him for personal consumption;
(ii) sub-section (1D) means a person who obtains in any sale, goods of the nature specified in the said sub-section;
(ab) “jewellery” shall have the meaning assigned to it in the Explanation to sub-clause (ii) of clause (14) of section 2.’;
(II) in clause (c), after the words, brackets and figure “in sub-section (1)”, the words, brackets, figure and letter “or sub-section (1D)” shall be inserted.
Notes on Clauses:
Clause 79 of the Bill seeks to amend section 206C of the Income-tax Act relating to the profits and gains from the business of trading in alcoholic liquor, forest produce, scrap, etc.
The existing provisions of sub-section (1) of the aforesaid section 206C provide that every person, being a seller shall, at the time of debiting of the amount payable by the buyer to the account of the buyer or at the time of receipt of such amount from the said buyer in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, collect from the buyer of any goods of the nature specified in column (2) of the Table, a sum equal to the percentage, specified in the corresponding entry in column (3) of the said Table, of such amount as income-tax.
It is proposed to amend the aforesaid sub-section so as to insert a new serial number (vii) relating to minerals, being coal or lignite or iron ore in the Table in said sub-section to provide for collection of tax at source at the rate of one per cent. in case of minerals, being coal or lignite or iron ore.
It is further proposed to insert a new sub-section (1D) in the aforesaid section to provide that every person, being a seller, who receives any amount in cash as consideration for sale of bullion or jewellery, shall, at the time of receipt of such amount in cash, collect from the buyer, a sum equal to one per cent. of sale consideration as income-tax, if the sale consideration exceeds two hundred thousand rupees.
It is also proposed to amend sub-sections (2), (3) and (9) of the aforesaid section which are consequential in nature.
It is also proposed to insert a new proviso to sub-section (6A) of the aforesaid section so as to provide that any person, other than a person referred to in sub-section (1D), responsible for collecting tax in accordance with the provisions of this section, who fails to collect the whole or any part of the tax on the amount received from a buyer or licensee or lessee or on the amount debited to the account of the buyer or licensee or lessee shall not be deemed to be an assessee in default in respect of such tax if such buyer or licensee or lessee--
(i) has furnished his return of income under section 139;
(ii) has taken into account such amount for computing income in such return of income; and
(iii) has paid the tax due on the income declared by him in such return of income, and also furnishes a certificate to this effect from an accountant in such form as may be prescribed.
It is also proposed to insert a new proviso to sub-section (7) of the aforesaid section so as to provide that in case any person, other than a person referred to in sub-section (1D), responsible for collecting tax in accordance with the provisions of this section, fails to collect the whole or any part of the tax on the amount received from a buyer or licensee or lessee or on the amount debited to the account of the buyer or licensee or lessee but is not deemed to be an assessee in default under the first proviso of sub-section (6A), the interest shall be payable from the date on which such tax was collectible to the date of furnishing of return of income by such buyer or licensee or lessee.
It is also proposed to amend the Explanation to the aforesaid section so as to provide the meaning of “buyer” with respect to sub-section (1) and sub-section (1D) of the said section and meaning of jewellery.
It is also proposed to insert a new clause in the aforesaid Explanation so as to define the expression “accountant”.
It is also proposed to insert sub-section (1D) in clause (c) of the aforesaid Explanation.
These amendments will take effect from 1st July, 2012.
