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Home Acts & Rules Bill Bills FINANCE BILL, 2017 Chapters List Chapter III DIRECT TAXES - Income-tax This

Clause 71 - Amendment of section 206C. - FINANCE BILL, 2017

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

Amendment of section 206C.

71. In section 206C of the Income-tax Act,-

(a) in sub-section (1D),-

(A) for the words and brackets “or jewellery or any other goods (other than bullion or jewellery)”, the words and brackets “or any other goods (other than bullion)” shall be substituted;

(B) clause (ii) shall be omitted;

(b) in sub-section (1E), the words “or jewellery” shall be omitted;

(c) in the Explanation occurring after sub-section (11),-

(A) in clause (aa),-

(I) in sub-clause (ii), the words, brackets, figure and letter “or sub-section (1F)” shall be omitted;

(II) after sub-clause (ii), the following sub-clause shall be inserted, namely:-

“(iii) sub-section (1F) means a person who obtains in any sale, goods of the nature specified in the said sub-section, but does not include,-

(A) the Central Government, a State Government and an embassy, a High Commission, legation, commission, consulate and the trade representation of a foreign State; or

(B) a local authority as defined in Explanation to clause (20) of section 10; or

(C) a public sector company which is engaged in the business of carrying passengers.”;

(B) clause (ab) shall be omitted.

 



 

Notes on Clauses:

Clause 71 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.

Clause (ii) of sub-section (1D) of the said section provides for tax collection at source at the rate of one per cent. of sale consideration on cash sale of jewellery exceeding five lakh rupees. It is proposed to omit the said clause in view of restriction on cash transactions as proposed to be provided under section 269ST.

The proposed amendment is consequential to the insertion of a new section 269ST in the Income-tax Act.

Sub-section (1F) of the said section, inter alia, provides that the seller who receives any amount as consideration for sale of a motor vehicle of the value exceeding ten lakh rupees, shall at the time of receipt of such amount, collect from the buyer a sum equal to one per cent. of the sale consideration as income-tax.

It is further proposed to insert a new sub-clause (iii) in clause (aa) of the Explanation to section 206C to exempt the following class of buyers from the provision of sub-section (1F) of the said section, namely:-

(i) the Central Government, a State Government and an embassy, a High Commission, legation, commission, consulate and the trade representation of a foreign State;

or

(ii) local authority as defined in the Explanation to clause (20) of section 10; or

(iii) a public sector company which is engaged in the business of carrying passengers.

It is also proposed to omit the reference of sub-section (1F) in sub-clause (ii) in the Explanation to section 206C.

These amendments will take effect from 1st April, 2017.

 
 
 
 

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