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Home Acts & Rules Bill Bills FINANCE BILL, 2017 Chapters List Chapter III DIRECT TAXES - Income-tax This
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Clause 40 - Amendment of section 90A. - FINANCE BILL, 2017

FINANCE BILL, 2017
Chapter III
DIRECT TAXES - Income-tax
  • Contents

Amendment of section 90A.

40. In section 90A of the Income-tax Act, after Explanation 3, the following Explanation shall be inserted with effect from the 1st day of April, 2018, namely:-

“Explanation 4.––For the removal of doubts, it is hereby declared that where any term used in an agreement entered into under sub-section (1) is defined under the said agreement, the said term shall have the same meaning as assigned to it in the agreement; and where the term is not defined in the said agreement, but defined in the Act, it shall have the same meaning as assigned to it in the Act and any explanation given to it by the Central Government.”.

 



 

Notes on Clauses:

Clause 40 of the Bill seeks to amend section 90A of the Income-tax Act relating to adoption by Central Government of agreement between specified associations for double taxation relief.

Under the provisions of section 90A, the Central Government may make necessary provisions for adopting and implementing an agreement entered into by any specified association in India with any specified association in the specified territory outside India, for granting of relief in respect of which income-tax has been paid both under the Incometax Act and income-tax in that specified territory outside India, for the avoidance of double taxation of income, exchange of information for the prevention of evasion or avoidance of income-tax or recovery of income-tax. It is further provided that any term used but not defined in Income-tax Act or in the agreement referred to in sub-section (1) of the said section shall have the meaning assigned to it in the notification issued by the Central Government in the Official Gazette in this behalf, unless the context otherwise requires, provided the same is not inconsistent with the provisions of Income-tax Act or the said agreement.

It is proposed to provide that where any term used in an agreement entered into under sub-section (1) of the said section is defined under the said agreement, the said term shall have the same meaning as assigned to it in the agreement; and where the term is not defined in the said agreement, but is defined in the Income-tax Act, it shall have the same meaning as assigned to it in the said Act and any Explanation to it by the Central Government.

This amendment will take effect from 1st April, 2018 and will, accordingly, apply in relation to the assessment year 2018-2019 and subsequent years.

 
 
 
 
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