Amendment of section 80JJAA.
27. In section 80JJAA of the Income-tax Act, in the Explanation, in clause (i), in the first proviso, in clause (b), for the words “bank account”, the words “bank account or through such other electronic mode as may be prescribed” shall be substituted with effect from the 1st day of April, 2020.
Notes on Clauses:
Clause 27 of the Bill seeks to amend section 80JJAA of the Income-tax Act relating to deduction in respect of employment of new employees.
Clause (b) of the first proviso to clause (i) of the said Explanation specifies that the additional employee cost in case of an existing business shall be nil if the emoluments are paid otherwise than by an account payee cheque or an account payee bank draft or by use of electronic clearing system through a bank account.
It is proposed to amend the said clause (b) so as to empower the Board to make rules to provide that deduction of an amount equal to thirty per cent. of additional employee cost in the case of an existing business shall be allowed if the emolument of such additional employees are paid through any other electronic mode as may be prescribed.
This amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-2021 and subsequent assessment years.
