Amendment of section 206C.
86. In section 206C of the Income-tax Act, with effect from the 1st day of June, 2016,-
(i) in sub-section (1), in the Table, after serial number (vii) 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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“(viii)
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Motor vehicle, value exceeding ten lakh rupees
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one per cent.:”;
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(ii) in sub-section (1D),-
(A) after the words “or jewellery”, the words “or any other goods (other than bullion or jewellery) or providing any service” shall be inserted;
(B) in clause (ii), for the word “rupees.”, the words “rupees; or” shall be substituted;
(C) after clause (ii), the following clause shall be inserted, namely:-
“(iii) for any goods, other than those referred to in clauses (i) and (ii), or any service, exceeds two hundred thousand rupees:
Provided that no tax shall be collected at source under this sub-section on any amount on which tax has been deducted by the payer under Chapter XVII-B.”;
(iii) after sub-section (1D), the following sub-section shall be inserted, namely:-
“(1E) Nothing contained in sub-section (1D) in relation to sale of any goods (other than bullion or jewellery) or providing any service shall apply to such class of buyers who fulfil such conditions, as may be prescribed.”;
(iv) after sub-section (11), in the Explanation, in clause (c), after the word “sold”, the words, brackets, figure and letter “or services referred to in sub-section (1D) are provided” shall be inserted.
Notes on Clauses:
Clause 86 of the Bill seeks to amend section 206C of the Income-tax Act relating to profits and gains from the business of trading in alcoholic liquor, forest produce, scrap, etc.
The aforesaid section, inter alia, provides that the seller shall collect tax at source at specified rate from the buyer at the time of sale of certain goods specified under the said section.
It is proposed to amend the aforesaid section to provide that the seller shall collect the tax at the rate of one per cent. on the sale of motor vehicle of the value exceeding ten lakh rupees in cash or by the issue of a cheque or draft or by any other mode or for sale of any other goods (other than bullion and jewellery) or providing any service in cash exceeding two hundred thousand rupees.
It is further proposed to insert a proviso under sub-section (1D) of the said section so as to provide that no tax shall be collected at source on any amount on which tax has been deducted by the payer under Chapter XVII-B of the Act.
It is also proposed to insert a new sub-section after sub-section (1D) so as to provide that nothing contained in sub-section (1D) in relation to sale of any goods (other than bullion or jewellery) or services shall apply to such classes of buyers who fulfils such conditions, as may be prescribed.
These amendments will take effect from 1st June, 2016.
