53. Amendment of section 286.
In section 286 of the Income-tax Act,––
(a) in sub-section (2), for the words, brackets and figures “on or before the due date specified under sub-section (1) of section 139, for furnishing the return of income for the relevant accounting year”, the words “within a period of twelve months from the end of the said reporting accounting year” shall be substituted and shall be deemed to have been substituted with effect from the 1st day of April, 2017;
(b) in sub-section (3), after the word, brackets and figure “sub-section (2)”, the words, brackets and figure “and sub-section (4)” shall be inserted and shall be deemed to have been inserted with effect from the 1st day of April, 2017;
(c) in sub-section (4),––
(i) after the words “reporting accounting year”, the words “within the period specified in that sub-section” shall be inserted and shall be deemed to have been inserted with effect from the 1st day of April, 2017;
(ii) clause (a) shall be relettered as clause (aa) thereof and before clause (aa) as so relettered, the following clause shall be inserted and shall be deemed to have been inserted with effect from the 1st day of April, 2017, namely:––
“(a) where the parent entity is not obligated to file the report of the nature referred to in sub-section (2);”;
(d) in sub-section (5),––
(i) in the opening portion, for the words “in the said sub-section”, the words “by that country or territory” shall be substituted and shall be deemed to have been substituted with effect from the 1st day of April, 2017;
(ii) in clause (e), for the word “entities”, the word “entity” shall be substituted and shall be deemed to have been substituted with effect from the 1st day of April, 2017;
(e) in sub-section (9),––
(A) for clause (b), the following clause shall be substituted and shall be deemed to have been substituted with effect from the 1st day of April, 2017, namely:––
‘(b) “agreement” means a combination of all of the following agreements, namely:––
(i) an agreement entered into under sub-section (1) of section 90 or sub-section (1) of section 90A; and
(ii) an agreement for exchange of the report referred to in sub-sections (2) and (4) and notified by the Central Government;’;
(B) in clause (d), in sub-clause (iii), for the words, brackets and figures “clause (i) or clause (ii)”, the words, brackets and figures “sub-clause (i) or sub-clause (ii)” shall be substituted and shall be deemed to have been substituted with effect from the 1st day of April, 2017;
(C) in clause (h), in the long line, for the words, brackets and figures “clause (i) or clause (ii)”, the words, brackets and figures “sub-clause (i) or sub-clause (ii)” shall be substituted and shall be deemed to have been substituted with effect from the 1st day of April, 2017;
(D) in clause (j), for the word, brackets and figure “sub-section (2)”, the words, brackets and figures “sub-sections (2) and (4)” shall be substituted and shall be deemed to have been substituted with effect from the 1st day of April, 2017.
Notes on Clauses:
Clause 53 of the Bill seeks to amend section 286 of the Income-tax Act relating to furnishing of report in respect of international group.
The said section, inter alia, provides for specific reporting regime containing revised standards for transfer pricing documentation and a template for country-by-country reporting.
Sub-section (2) of the said section provides that the parent entity or the alternate reporting entity of an international group which is resident in India shall furnish a report in respect of the international group on or before the due date specified under sub-section (1) of section 139 for furnishing of return of income of the relevant accounting year.
It is proposed to amend the said sub-section so as to provide that the said report for every reporting accounting year shall be furnished within a period of twelve months from the end of said reporting accounting year.
It is further proposed to amend sub-section (3) to give reference therein of the report to be furnished under sub-section (4). It is also proposed to amend sub-section (4) so as to provide in cae of a constituent entity, resident in India, whose parent entity is outside India that,-
(a) report of the nature referred to in sub-section (2) shall be furnished within the period specified in sub-section (2); and
(b) an additional condition for filing of report by said entity in a case where a country or territory, of which the parent entity is resident, is not obligated to file the report of the nature referred to in sub-section (2).
It is also proposed to amend sub-section (5) so as to provide that the due date for furnishing of the report of the nature referred to in sub-section (2) by said entity with the tax authority of the country or territory of which such entity is resident, would be the due date specified by that country or territory.
It is also proposed to consequentially substitute clause (b) of sub-section (9) so as to provide that the term "agreement" would mean a combination of,-
(i) an agreement referred to in sub-section (1) of section 90 or sub-section (1) of section 90A; and
(ii) an agreement as may be notified by the Central Government for exchange of the report referred to in sub-section (2) and subsection (4).
It is also proposed to consequentially amend clause (j) of sub-section (9) so as to also make reference to the report referred to in sub-section (4).
These amendments are clarificatory in nature.
These amendments will take effect retrospectively from 1st April, 2017 and will, accordingly, apply in relation to the assessment year 2017-2018 and subsequent years.
