Amendment of section 9A.
5. In section 9A of the Income-tax Act, in sub-section (3), in clause (j), after the proviso, the following proviso shall be inserted and shall be deemed to have been inserted with effect from the 1st day of April, 2016, namely:-
“Provided further that nothing contained in this clause shall apply to a fund which has been wound up in the previous year;”.
Notes on Clauses:
Clause 5 of the Bill seeks to amend section 9A of the Income-tax Act relating to certain activities not to constitute business connection in India.
Sub-section (3) of the said section 9A provides for the conditions to be fulfilled for being an eligible investment fund. Clause (j) of the said sub-section and the proviso provides that the monthly average of the corpus of the fund shall not be less than one hundred crore rupees except where the fund has been established or incorporated in the previous year, in which case, the corpus of fund shall not be less than one hundred crore rupees at the end of such previous year.
It is proposed to insert another proviso to clause (j) of the said sub-section so as to provide that the provisions of the said clause shall not be applicable to a fund which has been wound up in the previous year.
This amendment will take effect retrospectively from 1st April, 2016 and will, accordingly, apply in relation to the assessment year 2016-2017 and subsequent years.
