Amendment of section 115-O.
35. In section 115-O of the Income-tax Act, in sub-section (8), for the words “out of its current income”, the words “out of its current income or income accumulated as a unit of International Financial Services Centre after the 1st day of April, 2017” shall be substituted with effect from the 1st day of September, 2019.
Notes on Clauses:
Clause 35 of the Bill seeks to amend section 115-O of the Income-tax Act relating to tax on distributed profits of domestic companies.
Sub-section (8) of the said section provides that notwithstanding anything contained in this section, no tax on distributed profits shall be chargeable in respect of the total income of a company, being a unit of an International Financial Services Centre, deriving income solely in convertible foreign exchange, for any assessment year on any amount declared, distributed or paid by such company, by way of dividends (whether interim or otherwise), on or after the 1st day of April, 2017, out of its current income, either in the hands of the company or the person receiving such dividend.
It is proposed to amend the said sub-section so as to include the income accumulated after the 1st day of April, 2017 within the purview of the said sub-section.
This amendment will take effect from 1st September, 2019.
