TMI BlogNotes on clauses, Schedules, MemorandumX X X X Extracts X X X X X X X X Extracts X X X X ..... come of a period other than the financial year, the income-tax shall be charged accordingly. Such income-tax shall be charged at the rate specified in the First Schedule in the manner provided therein. The income-tax shall be deducted or collected at source or paid in advance in respect of the income chargeable to tax in accordance with the provisions of the Code. The chargeability of income-tax for any financial year shall be determined in accordance with the provisions of this Code as they stand on the 1st April of that financial year. Clause 3 deals with the scope of total income. It provides that subject to the provisions of the Code, the total income of any financial year of a person, who is a resident, shall include all income from whatever source derived which— (a) accrues, or is deemed to accrue, to him in India during the year; (b) accrues to him outside India during the year; (c) is received, or is deemed to be received, by him, or on his behalf, in India during the year; or (d) is received by him, or on his behalf, outside India during the year. The said clause also provides that subject to the provisions of the Code, the t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he following income shall be deemed to accrue in India— (a) income from employment, if it is for service rendered in India or for service rendered outside India by a citizen of India and the income is receivable from the Government; or the rest or leave period preceding or succeeding the period of service rendered in India and forms part of the service contract of employment; (b) any dividend paid by a domestic company outside India; (c) any insurance premium including re-insurance premium accrued from or payable by any resident or non-resident in respect of insurance covering any risk in India; (d) interest accrued from or payable by any resident or the Government; (e) interest accrued from or payable by any non-resident, if the interest is in respect of any debt incurred and used for the purposes of a business carried on by the non-resident in India or for earning any income from any source in India; (f) royalty accrued from or payable by any resident or the Government; (g) royalty accrued from or payable by a non-resident, if the royalty is for the purposes of a business carried on by the non-resident in India; or for earni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unless at any time in the twelve months preceding transfer, the fair market value of the assets in India owned, directly or indirectly, by the company represent at least fifty per cent of the fair market value of all assets owned by the company; (h) interest accrued from, or payable by, non-resident as referred to in sub-item (ii) of item (e) of sub-clause (2), if such interest has not been claimed by the nonresident as a deduction from his tax base chargeable in India. The clause also provides that in the case of a business of which all the operations are not carried out in India, the income of the business deemed to accrue in India shall be only such part of the income as is reasonably attributable to the operations carried out in India. The clause also provides that income (other than income from employment and any dividend paid by an Indian company outside India) shall be deemed to accrue in India, whether or not,— (a) the payment is made in India; (b) the services are rendered in India; (c) the non-resident has a residence or place of business or any business connection in India; or (d) the income has accrued in India. The clause further p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clause further provides that a transfer shall be deemed to be revocable if it contains any provision for the re-transfer, directly or indirectly, of the whole or any part of the income or assets to the transferor or it, in any way, gives the transferor a right to re-assume power, directly or indirectly, over the whole or any part of the income or assets. For the purpose of this clause, a transfer shall include any settlement, trust, covenant, agreement or arrangement. Clause 9 provides that the total income of any individual shall, inter alia, include all income accruing directly or indirectly— (i) to the spouse, by way of salary, commission, fees or any other form of remuneration, whether in cash or in kind, from a concern in which the individual has a substantial interest; (ii) from assets transferred, directly or indirectly, to the spouse by the individual, otherwise than for adequate consideration, or in connection with an agreement to live apart; (iii) from assets transferred, directly or indirectly, to the son's wife by the individual, otherwise than for adequate consideration; or (iv) from assets transferred, directly or indirectly, to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . "Converted property" has been defined in clause 314 of the Code. Clause 10 provides that the total income of a financial year of a person shall not include the income enumerated in the Sixth Schedule. Clause 11 provides that the persons enumerated in the Seventh Schedule shall not be liable to income-tax under this Code for any financial year, subject to the fulfillment of conditions specified in the said Schedule. Chapter III deals with computation of total income. Sub-chapter I relates to general provisions. Clause 12 provides that the total income shall be computed in accordance with the provisions of the Chapter. It also clarifies that unless otherwise provided in the Code, reference to any accrual, receipt, expenditure, withdrawal, asset or liability shall be construed to be in relation to the financial year in respect of which, and the person in respect of whom, the income is computed. Clause 13 relates to classification of sources of income. It provides that for the purposes of computation of total income of any person for any financial year, income from all sources shall be classified as follows: A.— Income from ordinary sources. B.— Income f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting the interest of the revenue, it is necessary to do so. Clause 18 provides that in computing the total income of a person for any financial year, the following expenditure shall not be allowed as a deduction, namely:— (a) any expenditure attributable to income which is not included in the total income under the Sixth Schedule, determined in accordance with such method as may be prescribed; (b) any expenditure attributable to any income from special sources; (c) any expenditure which has been allowed as a deduction in any other financial year; (d) any expenditure incurred for an activity which is an offence or which is not permissible by law; (e) any provision made for any liability, if it remains unascertained by the end of the financial year; and (f) any unexplained expenditure referred to in item (q) of sub-clause (2) of clause 58. The said clause also provides that any amount allowed as a deduction under any provision of the Code shall not be allowed as a deduction under any other provision of the Code. The provisions of this clause shall apply notwithstanding anything contained in any other provisions of Chapter III. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e actually incurred for that purpose and to meet personal expenses, considering the place of parting or nature of duties or place of residence, subject to such conditions an limits as may be prescribed; (d) any amount of contribution made by an employer in the financial year to the account of an employee under an approved pension fund notified by the Central Government, to the extent it does not exceed ten per cent. of the salary of the employee; (e) any amount of contribution made by an employer in the financial year to the account of an employee in an approved superannuation fund; (f) any amount of contribution by an employer, in the financial year, to an account of an employee in an approved provident fund to the extent it does not exceed twelve per cent. of the salary of the employee; (g) any amount of interest credited, in the financial year, on the balance to the credit of an employee in an approved fund to the extent it does not exceed the amount of interest payable at the rate notified by the Central Government; (h) any allowance provided by an employer to meet the expenditure actually incurred on payment of rent in respect of residen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from house property shall be the following, namely:— (a) the amount of taxes levied by a local authority in respect of such property, to the extent the amount is actually paid by him during the financial year; (b) a sum equal to twenty per cent. of the gross rent determined under clause 26 towards repair and maintenance of such property; (c) the amount of any interest on loan taken for the purposes of acquisition, construction, repair or renovation of the property or on loan taken for the purpose of repayment of the said loan. The interest which pertains to the period prior to the financial year in which the house property has been acquired or constructed shall be allowed as deduction in five equal instalments beginning from such financial year. Such interest shall be reduced by any part thereof which has been allowed as deduction under any other provision of the Code. Clause 28 provides that the amount of rent received in advance shall be included in the gross rent of the financial year to which the rent relates. Clause 29 provides that income in respect of the rent received in arrears in a financial year shall be computed under the head "Income from ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss of insurance shall be computed in accordance with the Eighth Schedule. The profits from the business of operating a qualifying ship shall be computed in accordance with the Tenth Schedule. The profits from the business of mineral oil or natural gas shall be computed in accordance with the Eleventh Schedule. The profits from the business of developing or aporating from a special economic zone or profits from the business of manufacture or production, or providing of services, by a unit in special economic zone shall be computed in accordance with the Twelfth Schedule. The profits from the business of generation and distribution of power, development of infrastructure facility, cold chain facility, running a hospital, laying and operating a cross country natural gas or crude or petroleum oil pipeline network shall be computed in accordance with the Thirteenth Schedule. The profits from any business not referred to above shall be the gross earnings from the business as reduced by the amount of business expenditure incurred by the person. Clause 33 seeks to provide that the gross earnings from the business not covered by the Eighth, Tenth, Eleventh, Twelfth and the Thirteenth Sc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce or credit; (xii) any amount accrued to or received on account of the cessation or forfeiture of any agreement entered in the course of the business; and (xiii) any interest accrued to, or received by, a person being a financial institution, etc. However, the gross earnings from business shall not include any dividend, any interest other than interest accrued to, or received by, a person being a financial institution, any income from letting of house property which is included under the head "income from house property" and any income from the transfer of an investment asset. Clause 34, inter alia, provides that the amount of business expenditure shall be aggregate of the operating expenditure, finance charges and capital allowances. Clause 35, inter alia, provides that the amount of operating expenditure for the purposes of clause 34 shall be the aggregate of — (a) the amount of expenditure specified in sub-clause (2), if it is laid out or expended, wholly and exclusively, for the purposes of the business and fulfills specified conditions; (b) the value of inventory of the business, as at the beginning of the financial year; (c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at any expenditure, being in the nature of, or on account of personal expenses, capital expenditure including expenditure in respect of which capital allowance is allowable under clause 37, finance charges, any unascertained liability of the person, remuneration payable to any participant other than a working participant, any expenditure incurred on advertisement in any souvenir, brochure, tract, pamphlet or the like published by a political party, any tax, interest or penalty payable under this Code, any amount paid which is eligible for relief of tax under section 207 any dividend declared or distributed or paid and any amount of contributions by an employr during the financial year to an approved superannuation fund on account of an employee to the extent it exceeds one lakh rupees shall not be allowed as operating expenditure. Clause 36 provides the determination of finance charges in relation to business expenditure which shall be aggregate of the operating expenditure, permitted finance charges and capital allowances. Clause 36 provides that the amount of finance charges for the purposes of clause 34 shall be— (a) the amount of interest paid on any capital borrowed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion or terminal allowance shall be allowed in respect of any business capital asset if the asset is owned, wholly or partly, by the person, and used for the purposes of the business of the person. However, the condition of ownership, whether whole or in part, shall not apply in the case of a business capital asset being a capital expenditure on any building which is held by the person under a lease or other right of occupancy. A business capital asset shall be deemed to be owned by the person if he is a lessee in terms of a financial lease. The said clause also provides that the amount of deferred revenue expenditure allowance referred to above shall be as specified and computed in accordance with the Twenty-second Schedule. Clause 37 provides that the amount of capital allowances shall be the aggregate of the amount in respect of depreciation of business capital assets, initial depreciation of business capital assets, terminal allowance, scientific research and development allowance and deferred revenue expenditure allowance. Clause 38, inter alia, seeks to provide that the amount of depreciation of business capital assets shall be the aggregate of the following, namely:— ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ason of being demolished, destroyed, discarded or transferred during the financial year and the percentage specified in the Fifteenth Schedule for computing depreciation in respect of the block of assets is zero. The terminal allowance shall be aggregate of the written down value of the block of asset at the beginning of the financial year and the actual cost of any asset falling within that block, acquired during the financial year, as reduced by the amount accrued or received in respect of the assets which are demolished, destroyed, discarded or transferred during the financial year together with the value of the carcass or the scrap, if any. The said clause further provides that the terminal allowance shall be treated as "nil", if the net result of the computation is negative. Clause 41 seeks to provide that a company shall be allowed a deduction equal to two hundred per cent. of the expenditure (not being expenditure in the nature of cost of any land or building) incurred on creating and maintaining an in-house facility for scientific research and development and carrying out scientific research and development in the in-house facility. The deduction under this clause s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the period beginning with the first day of the financial year and ending on the day immediately preceding the date of business reorganisation; C = the total number of days in the financial year in which the business reorganisation has taken place. The said clause further provides that the the amount of deduction to the successor shall be determined in accordance with the formula — A x B/C Where A = the amount of deduction allowable as if the business reorganisation had not taken place; B= the number of days comprised in the period beginning with the date of business reorganisation and ending on the last day of the financial year; and C = the total number of days in the financial year in which the business reorganisation has taken place. Clause 44 seeks to provide the meaning of actual cost for the purposes of computation of income under the head 'income from business'. The said clause, inter alia,provides that the actual cost of a business asset to the person shall be computed in accordance with the formula— A-[B+(C xA)/D] Where A = cost of the business asset to the person inclu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal asset is acquired by the person and subsequently it is transferred back to the transferor by way of lease, hire or otherwise, the actual cost of the asset in the hands of the person shall be the written down value of the asset in the hands of the transferor at the beginning of the financial year in which the acquisition of the asset by the person has taken place. It is further provided that where the person is a non-resident and a business capital asset, having been acquired by him outside India, is brought by him to India, the actual cost of the asset for the person shall be the cost of acquisition of the asset by him, as reduced by an amount equal to the amount of depreciation which would have been allowable, had the asset been used in India for the purposes of the business of the person since the date of such acquisition. The clause provides that the actual cost of an asset shall be treated as 'nil', if deduction in respect of the cost of the asset has been allowed or is allowable to the person under the Eleventh Schedule or the Twelfth Schedule or the Thirteenth Schedule, or deduction in respect of the cost of the asset has been allowed or is allowable under any of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f clause 44. The said clause further provides that the adjusted value of any block of asset shall be "nil" if the amount (C+D+E) exceeds the amount (A+B). The said clause also provides that the adjusted value of the block of assets, acquired by a successor in a business reorganisation, for the financial year in which the business reorganisation has taken place shall be the amount which would have been taken as the adjusted value of the block of assets as if the business reorganisation had not taken place. The said clause also provides the formula for determining the written down value of the block of assets, acquired by a successor in a business reorganization, on the last day of the financial year in which the business reorganization has taken place as well as for computing the adjusted value of the block of assets where a block of assets comprises of any asset acquired in any financial year from a country outside India for the purposes of business and there is variation in liability in respect of acquisition of the asset after the date of such acquisition. It has been provided in the said clause that the amount of liability of the person, expressed in Indian rupees at the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Clause 47 provides that the income from certain transfers shall not be treated as capital gains. It, inter alia, provides that the following transfers shall not be included in the computation of income under the head "Capital gains", namely:— (a) distribution of any investment asset on the total or partial partition of a Hindu undivided family; (b) gift, or transfer under an irrevocable trust, of any investment asset (other than sweat equity share); (c ) transfer of any investment asset under a will; (d) transfer of any investment asset by a company to its Indian subsidiary company, if the parent company or its nominees hold the whole of the share capital of such subsidiary and such subsidiary treats the asset as an investment asset; (e) transfer of any investment asset by a subsidiary company to the Indian holding company, if the whole of the share capital of the subsidiary company is held by such holding company or its nominees and the holding company treats the asset as an investment asset; (f) transfer of any investment asset by a predecessor to a successor Indian company in a scheme under a business reorganisation; (g) transfe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount assessed as dividend within the meaning of item (c) of sub-clause (81) of clause 314, the financial year in which the money or asset is received. The said clause also provides that any consideration from transfer made by the depository or participant of any beneficial interest in a security shall be deemed to be the income of the beneficial owner of the financial year in which such transfer took place. The said clause further provides that the amount referred to in item (d) of sub-clause (2) of clause 46 shall be the income of the financial year in which such amount is withdrawn and the amount referred to in item (e) of sub-clause (2) of clause 46 shall be the income of the third financial year immediately following the financial year in which the transfer of the original asset is effected. The amount referred to in item (f) of sub-clause (2) of clause 46 shall be the income of the financial year in which any condtions referred to in sub-clause (6) of clause 55 is not complied with. The said clause also defines the term "beneficial owner". Clause 49 relates to the computation of income from transfer of any investment asset. The income from the transfer of any invest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cquired by the persons, the following deductions shall be allowed for the purposes of computation of income from the transfer of such asset :— (i) the indexed cost of acquisition, if any, of the asset; (ii) the indexed cost of improvement, if any, of the asset; (iii) the amount of expenditure, if any, incurred wholly and exclusively in connection with the transfer of the asset; and (iv) the amount of relief for rollover of the asset, as determined under clause 55. Clause 52 relates to indexed cost of acquisition or improvement. The indexed cost of acquisition of an investment asset referred to in sub-clause (3) of clause 51 for the purposes of computation of income from transfer of such asset shall be the amount determined in accordance with the formula specified in sub-clause (1) of the said clause. The said clause further provides that the indexed cost of improvement of an investment asset referred to in sub-clause (3) of clause 51 shall be in accordance with the formula specified in sub-clause (2) of the said clause. Clause 53 relates to cost of acquisition of an investment asset. It, inter alia, provides that the cost of acquisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us owner" and "net worth". Clause 54 provides that the cost of improvement of an investment asset shall be any expenditure of a capital nature incurred in making any additions or alterations to the asset by the person or by the previous owner, if the asset is acquired by any special mode of acquisition referred to in sub-clause (237) of clause 314. The said clause also provides that the cost of improvement of the investment asset, in a case where the asset became the property of the person or the previous owner before the first day of April, 2000, shall be any capital expenditure incurred for any addition or alteration to such asset on or after the first day of April, 2000. The said clause further provides that the cost of improvement of an investment asset shall be "nil " in relation to— (a) an investment asset acquired by self-generation; (b) an investment asset being an undertaking or division transferred by way of a slump sale; or (c) any investment asset if the cost of improvement cannot be determined or ascertained, for any reason. The said clause also provides that any expenditure deductible in computing the income under any other head of income sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f transfer and the person, being an individual or Hindu undivided family, acquires one or more pieces of agricultural land at least one year before the beginning of the financial year in which the transfer of the asset took place subject to the condition that the new asset shall not be transferred within one year from the end of the financial year in which the new asset is acquired; (b) the transferred investment asset (original investment asset) was any asset acquired at least one year before the beginning of the financial year of transfer and the new investment asset is a residential house and the person does not own more than one residential house, other than the new investment asset on the date of transfer of the original asset subject to the condition that a new asset shall not be transferred which one year from the end of the financial year in which the new asset is acquired or constructed; The said clause also defines the term "net consideration". Clause 56 provides that the income of every kind falling under the clause "Income from ordinary sources", shall be computed under the head "Income from residuary sources". if it is not required to be included in computing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ffers no explanation about the nature and source of acquisition of the same or offers an explanation but fails to substantiate it or such explanation is not satisfactory in the opinion of the Assessing Officer; (l) the amount of any expenditure incurred by the person in the financial year, if he offers no explanation about the source of such expenditure or offers an explanation but fails to substantiate it or such explanation is not satisfactory in the opinion of the Assessing Officer; (m) any amount of income of a controlled foreign company attributable to a resident in accordance with the Twentieth Schedule; (n) any amount received as advance, security deposit or otherwise from the long-term leasing or transfer of whole or part of or any interest in any investment asset; (o) any sum received as family pension. The said clause provides that the value of any property referred to in (h) or (i) above shall be the stamp duty value in the case of an immovable property as reduced by the amount of consideration, if any, paid by the person and the fair market value in the case of any other property as reduced by the amount of consideration, if any, paid by the pe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to provide the manner in which the income under each head of income is to be aggregated for a financial year so as to result in the income from any particular head of income for that financial year. Thus, the income for a financial year under each of the five heads of income would be determined in accordance with the provisions of this clause. The said clause further provides for the computation of the income from capital gains, speculative business and income from the activity of owning and maintaining horses for the purpose of horse race in such a manner that any loss from such sources shall be set off only against positive income from such sources. Clause 61 seeks to provide the manner in which the current income from ordinary sources for a year is to be computed. The classification of income as "Income from ordinary sources" and "Income from special sources" has been provided in clause 13 of the Code. The said clause further provides that the current income of a financial year under each head of income is to be aggregated to arrive at the current income from ordinary sources. This current income is to be further aggregated with the unabsorbed preceding year loss from or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reorganisation takes place, shall be treated as the unabsorbed preceding year loss from ordinary sources of the successor in business in that year and the provisions of clause 61 shall apply. Similarly, the unabsorbed current loss from special sources of the predecessor in the financial year in which the business reorganisation takes place, shall be treated as the unabsorbed preceding year loss from special sources of the successor in business in that year and the provisions of clause 62 shall apply. Sub-clause (2) of the said clause provides that the benefit of taking over the loss of the predecessor by the successor shall not be available to the latter in a case of business reorganisation if it does not satisfy the test of continuity of business. Test of continuity of business has been defined in clause 314 of the Code as a set of conditions which the successor must fulfill to satisfy the test. Sub-clause (2) further provides that the said benefit shall not be available to a successor in case of a business reorganisation if the predecessor is a sole proprietary concern or an incorporated body and the share holding of the sole proprietor ceases to be less than fifty per cent. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t financial year. The said clause also provides that while calculating the percentage of voting power— (a) any change in the voting power in the relevant financial year due to the death of a shareholder or on account of transfer of shares by way of gift to any relative of the donor shareholder shall be ignored; (b) any change in the shareholding of an Indian company, which is a subsidiary of a foreign company, as a result of amalgamation or demerger of a foreign company, shall be ignored, if fifty-one per cent shareholders of the amalgamating or demerged foreign company continue to be the shareholders of the amalgamated or the resulting foreign company. Clause 67 seeks to provide that aggregation of losses generated in a financial year shall not be allowed if the return of tax bases for the said year is not furnished by the due date. Thus, the losses generated in the current year shall not be taken into consideration for any purposes of the Code. Sub-chapter IV of Chapter III of the Bill deals with tax incentives. Tax incentives are the deductions available to a person while computing his total income for a financial year. Clause 68 provides that the deductions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f any sum paid during the financial year as tuition fee to any school, college, university or other educational institution situated within India for the purpose of full-time education of any two children of such individual or Hindu undivided family. The said clause further provides that tuition fee shall not include any payment towards any development fee or donation or any payment of similar nature. It also clarifies that full-time education shall include education in a play school or pre-school. Clause 73 seeks to provide a maximum limit on the amount of deduction available under clauses 70, 71 and 72. It lays down a ceiling of fifty thousand rupees on the amount of deduction available in respect of payments made for a life insurance policy, health insurance policy and education of children. Clause 74 seeks to provide that a person, being an individual or a Hindu undivided family, shall be allowed a deduction in respect of an amount paid or payable by way of interest on loan taken for the purpose of acquisition, construction, repair or renovation of a house property in the financial year in which such property is acquired or constructed or any subsequent financial year, su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be allowed a deduction in respect of any amount paid during the financial year for medical treatment of the prescribed disease or ailment of any specified person. Sub-clause (2) of the said clause provides that the deduction available shall be a maximum of sixty thousand rupees in case the payment is made for a senior citizen and forty thousand rupees if the payment is made for any other person. Sub-clause (3) of the said clause provides that the deduction allowable shall be reduced by the amount received, if any, under an insurance from an insurer, or reimbursed by an employer, for the medical treatment of the specified person. Sub-clause (4) of the said clause provides that the deduction shall not be allowed unless the person obtains a certificate from a prescribed specialist working in a Government hospital. Sub-clause (5) of the said clause defines the terms "specified person" and "Government hospital". Clause 77 seeks to provide a deduction to a person, being a resident individual and having a disability, subject to certain conditions. The deduction shall be allowed if the person obtains a certificate from a medical authority in the prescribed form and manner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by him in the financial year as contribution or donation to any person specified in Part-I of the Sixteenth Schedule; (b) one hundred and twenty-five per cent. of the amount of money paid by him in the financial year as contribution or donation to any person specified in Part-II of the Sixteenth Schedule; (c) one hundred per cent. of the amount of money paid by him in the financial year as donation to any person specified in Part-III of the Sixteenth Schedule; (d) fifty per cent. of the aggregate amount of money paid by him in the financial year as donation to any person specified in Part-IV of the Sixteenth Schedule. Parts I, II, III and IV of the Sixteenth Schedule to the Bill contain the names of the organisations/institutions/funds to which such contribution or donation is to be made so as to be eligible for the deduction under this clause. Sub-clause (2) of the said clause provides that the aggregate of the amount of money paid to persons specified in Part IV of the Sixteenth Schedule shall be limited to ten per cent. of the gross total income from ordinary sources, if the aggregate exceeds ten per cent. of such gross total income from ordinary sources. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of a company and five per cent. of the gross total income from ordinary sources, in any other case. The clause also defines the term "contribution". Clause 82 seeks to provide that a person, being an Investor Protection Fund, shall be allowed a deduction of the amount of contribution received from any recognised stock exchange, or recognised commodity exchange, and the members thereof if such amount is included in its gross total income from ordinary sources. The said clause further provides that the deduction shall be allowed if the Investor Protection Fund is set up, either jointly or separately, by recognised stock exchanges or recognised commodity exchanges and such Investor Protection Fund is notified by the Central Government. Clause 83 seeks to provide a deduction of up to three lakh rupees to a resident individual, who is an author, in respect of income earned by him as a lump sum consideration for the assignment or grant of any of his interest in the copyright of the book written by him or as a royalty or copyright fee in respect of the said book, if such income is included in his gross total income from ordinary sources. The said clause further provides that t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Any person carrying on legal, medical, engineering, architectural, accountancy, technical consultancy, interior decoration or any other notified profession or carrying on business shall keep and maintain such books of account if — (i) his income from the business exceeds two lakh rupees; (ii) his total turnover or, gross receipts as the case may be, in the business exceeds ten lakh rupees in any one of the three financial years immediately preceding the relevant financial year; or (iii) his income or, total turnover as the case may be, his in a case of a newly set up business in any financial year, is likely to exceed two lakh rupees or ten lakh rupees, respectively, during such financial year. The said clause further provides that every person who has entered into an international transaction shall keep and maintain such information and documents in respect of such transactions, as may be prescribed. The said clause also provides that the Board may prescribe the books of account other than those enumerated in the clause and also the period for which the books of account and other documents required to be kept and maintained under this clause shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od of accounting regularly employed by the person and further adjusted to include the amount of any tax, duty, cess or fee leviable on the sale of the goods. Sub-clause (5) of the said clause provides that the interest on bad or doubtful debts of any financial institution shall be included in its total income of the financial year in which the interest is credited to the profit and loss account or is actually received, whichever is earlier. Sub-clause (6) of the said clause provides that the interest received by a person on compensation or on an enhanced compensation shall be included in the total income of the financial year in which it is received. Sub-clause (7) of the said clause defines the term "bad or doubtful debts". Chapter IV deals with special provisions relating to the computation of total income of non-profit organisations. Clause 90 provides that Chapter-IV shall be applicable to a non-profit organisation, other than any organisation of public importance, specified in the Seventh Schedule. It also provides that the Central Government may, subject to such conditions as may be considered necessary, notify a person as a non-profit organisation of public importa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the asset is not used for the purposes of any charitable activity or any business incidental to such charitable activity; (e) full value of the consideration received from the transfer of any business capital asset, other than the asset referred to clause (d); (f) the amount of income received from investment of its funds or assets; and (g) the amount of any incoming, realisation, proceeds, or subscription received from any source. (h) any amount, which was received in the last month of the immediately preceding financial year and was deposited in a specified deposit account as referred to sub-items (e) of clause 94.' The said clause further provides that such gross receipts shall not include any loan taken during the financial year and voluntary contributions received with a specific direction that they shall form part of the corpus of the non-profit organisation. Clause 94 provides that for the purpose of computation of the total income, the amount of outgoings during the financial year of a non-profit organisation shall be the aggregate of — (a) the amount paid for any expenditure incurred wholly and exclusively for earning or obtaining any receipts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... modes. Clause 97 relates to use or application of funds or assets for the benefit of an interested person. It provides that the funds or the assets of the non-profit organisation shall not be used or applied, directly or indirectly, for the benefit of an interested person. The said clause further provides that the funds or assets of the non-profit organisation shall be deemed to have been used or applied for the benefit of an interested person, if — (a) its funds or assets are lent to any interested person, for any period during the financial year without either adequate security or adequate interest or both; (b) its land, building or other asset is made available for the use of any interested person for any period during the financial year without charging adequate rent or other compensation; (c) any amount is paid by way of salary, allowance or otherwise during the financial year to any interested person for services rendered to the non-profit organisation and the amount so paid is in excess of what may be reasonably paid for such services; (d) the services of the non-profit organisation are made available to any interested person during the financial year ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he non-profit organisation are not genuine or are not being carried out in accordance with its objects or are not being carried out in accordance with the any other law which is applicable to it or under which it is registered or approved, he shall pass an order in writing cancelling the registration or withdrawing the approval, after giving the organisation an opportunity of being heard. Clause 99 provides that a non-profit organisation shall keep and maintain the prescribed books of account. It shall also maintain separate books of account in respect of business incidental to charitable activity. The said clause further provides that if the gross receipts referred to in clause 93 of the non-profit organisation in any financial year exceed five lakh rupees, it shall obtain an audit report from an accountant in the prescribed form before the due date of filing of the return of tax bases. Clause 100 deals with anonymous donations received by a non-profit organisation. The said clause defines "anonymous donation" to mean any voluntary contribution, where a person receiving such contribution does not maintain a record of the identity indicating the name and address of the person m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... espective of registration granted under clause 97; or (d) carries on any business which is not incidental to charitable activity. The said clause further provides that the non-profit organisation which ceases to be a non-profit organisation on account of conversion, merger or dissolution as referred to in sub-clause (1) of clause 101 shall be liable to income-tax in respect of its net worth in accordance with that section. The said clause also provides that the total income of any person falling under (a), (b), (c) or (d) above shall be computed in accordance with the other provisions of the Code. Clause 103 provides the meaning of certain terms used in Chapter-IV. It defines "charitable activity" to mean the following activities carried out in India, namely:— (i) relief of the poor; (ii) advancement of education; (iii) medical relief; (iv) preservation of environment including watersheds, forests and wildlife; (v) preservation of monuments or places or objects of artistic or historic interest; or (vi) advancement of any other object of general public utility, not involving the carrying on of any activity in the nature ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the profit and loss account of the company for a financial year shall be in accordance with the provisions of Parts II and III of Schedule VI to the Companies Act, 1956. For the purposes of this clause, the accounting policies, the accounting standards adopted for preparing such accounts (including profit and loss account) and the method and rates adopted for calculating the depreciation shall be the same as have been adopted by the company for the purpose of preparing and laying of such accounts at its annual general meeting in accordance with the provisions of section 210 of the Companies Act, 1956. The said clause further provides that where the company has adopted or adopts a financial year under the Companies Act, 1956, which is different from the financial year under this Code, then the accounting policies, the accounting standards adopted for preparing such accounts (including profit and loss account) and the method and rates adopted for calculating the depreciation shall correspond to the accounting policies, accounting standards and the method and rates for calculating the depreciation which have been adopted for preparing such accounts for such financial year or p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to income-tax in the same manner as if it were the income received by such person had he made investments directly in the venture capital undertaking. In other words, this clause provides a pass through status to venture capital companies and funds and they would have no income-tax liability on any income received on account of investments made by them in any venture capital undertaking. The said clause further provides that the venture capital company, the venture capital fund or the person responsible for making payment of the income on behalf of such company or fund shall furnish, within the prescribed time limit, a prescribed statement giving the details of the nature of the income paid during the financial year and other relevant details, to the person receiving such income and to the prescribed income-tax authority. The said clause also provides that the income paid by the venture capital company and the venture capital fund shall be deemed to be of the same nature and in the same proportion in the hands of the person receiving such income as it had been received by the said company or the fund during the financial year. The said clause also clarifies that the provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on distributed income of mutual funds and insurance company. The said clause provides that every mutual fund shall be liable to pay tax on any amount of income distributed or paid to the unit holders of an equity oriented fund and every life insurer shall be liable to pay tax on any amount of income distributed or paid to the policy holders of an approved equity oriented life insurance scheme. The tax shall be charged on the distributed income at the rate specified in Paragraph C of the Second Schedule. The said clause also provides that the tax on distributed income shall be paid to the credit of the Central Government within fourteen days from the date of distribution or payment of such income, whichever is earlier. The clause further provides that the tax paid by the mutual fund or the life insurer on distributed income shall be treated as the final payment of tax in respect of such income and no further credit shall be claimed by either of them or by any other person in respect of the tax so paid. Besides, no deduction under any other provision of this Code shall be allowed to the mutual fund or the life insurer in respect of the distributed income charged to tax or the ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed as a formula. The formula provides that the net wealth shall be the aggregate value of all the specified assets of the person on the date of valuation as reduced by the aggregate value of all the debts owed by the person, which have been incurred in relation to the specified assets. The said clause further provides a detailed list of all the specified assets and also lists out certain assets that shall not be treated as specified assets for the purposes of this clause. It also lists the categories of houses which shall be excluded from the specified asset, being "house". The clause also provides that the value of any specified asset, other than cash, shall be determined in such manner as may be prescribed and clarifies that the term "valuation date" means the 31st day of March in every financial year. Clause 114 provides that if the specified assets are held by certain relatives, such as spouse or minor child, associates or associated entities of a person, then they shall be deemed to be belonging to such person if they fulfill certain conditions specified therein and shall be charged to wealth-tax in his hands. The said clause further provides that if a minor child h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accordance with the most appropriate method out of all the prescribed methods. The most appropriate method shall be determined having regard to the nature of transaction, class of transaction, class of associated enterprises or functions performed by such enterprises or such other relevant factors as may be prescribed. The said clause further provides that the arm's length price shall be the price determined by the most appropriate method if only one price is determined by such method or the arithmetical mean of the prices determined by the most appropriate method if more than one price is determined by such method. Further, the price at which the international transaction has actually been undertaken shall be deemed to be the arm's length price if the variation between the arm's length price and the actual price does not exceed five per cent. of the latter. The clause also provides that no deduction under Sub-chapter IV of Chapter III (tax incentives) shall be allowed in respect of the amount of income by which the total income of the person is enhanced after computation of income under this clause. The said clause further provides that the determination of arm's length pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his clause shall not apply if the person referred herein shows to the satisfaction of the Assessing Officer that the transfer and all associated operations were bona fide commercial transactions and were not designed for the purpose of avoiding any tax liability. Clause 120 relates to avoidance of tax by sale and buy-back transaction in a security and provides that the total income of any person shall include any interest accruing from any security owned by any other person if the transaction relating to sale and buy back of the security has been undertaken by the other person, if the interest accrues to the other person as a result of such transaction and if the transfer had not taken place, the income would have been included in the total income of the first-mentioned person. Clause 121 seeks to provide that the transaction relating to buy and sale back of security under clause 120 shall, in the case of the other person referred to therein, be ignored and shall not be taken into account if the interest accruing to the other person is not included in his total income by virtue of the provisions of that clause. The said clause further provides that the loss, if any, arising t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that an arrangement shall be presumed to have been entered into, or carried out, for the main purpose of obtaining a tax benefit unless the person obtaining the tax benefit proves that obtaining such benefit was not the main purpose of the arrangement. The term "arrangement" has been defined in clause 124. Clause 126 seeks to provide for the classes of income-tax authorities for the purpose of the Code. The income-tax authorities provided in the clause are— (a) The Central Board of Direct Taxes constituted under the Central Boards of Revenue Act, 1963, (b) Chief Commissioners of Income-tax or Directors-General of Income-tax, (c) Commissioners of Income-tax or Directors of Income-tax or Commissioners of Income-tax (Appeals), (d) Additional Commissioners of Income-tax or Additional Directors of Income-tax, (e) Joint Commissioners of Income-tax or Joint Directors of Income-tax, (f) Deputy Commissioners of Income-tax or Deputy Directors of Income-tax, (g) Assistant Commissioners of Income-tax or Assistant Directors of Income-tax, (h) Income-tax Officers, (i) Tax Recovery Officers, (j) Inspectors of Income-tax. Clause 127 relates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion, refund or any other relief under the Code after the expiry of the period specified by or under the Code for making the application or claim and deal with the same on merits in accordance with law; (c) any case or class of cases, relaxing any requirement or conditions contained in the Code in relation to grant of any relief , on fulfillment of certain conditions. The said clause also provides that the orders, instructions, directions and circulars issued by the Board under this clause shall be binding on all other income-tax authorities and other persons employed in the execution of the provisions of the Code. Clause 130 relates to the jurisdiction of income-tax authorities. The said clause seeks to provide that the income-tax authorities shall exercise its powers and performs its functions in accordance with the directions of the Board. The Board may in turn authorise any other income-tax authority to issue orders in writing for the exercise of the powers and performance of the functions by all or any of its other income-tax authorities who are subordinate to it. The orders of jurisdiction shall be made having regard to territorial area, persons or classes of perso ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lause also seeks to define the expression "case" for the purposes of Chapter XII relating to Tax Administration and procedure. Clause 133 relating to change of incumbent seeks to provide that the income-tax authority who succeeds another authority as a result of change in jurisdiction or for any other reason, shall continue the proceeding from the stage at which it was left by his predecessor. The assessee in such a case may be given, if so requested, an opportunity of being heard before passing any order under this Code in his case. Clause 134 relating to powers regarding discovery and production of evidence, etc., seeks to provide that the prescribed income-tax authorities and the Dispute Resolution Panel shall, for the purposes of the Code, have the same powers as are vested in a court under the Code of Civil Procedure, 1908 when trying a suit, in respect of the following matters— (a) discovery and inspection; (b) enforcing the attendance of any person, including any officer of a banking company and examining him on oath; (c) compelling the production of books of account and other documents; and (d) issuing commissions. The said clause further provides ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rade. Sub-clause (3) of the said clause provides that the Competent Investigating Authority may exercise the powers of search and seizure over a person on whom he exercises jurisdiction. The said clause also provides that the Authorised Officer may requisition the services of any police officer or of any officer of the Central Government to assist him and it shall be the duty of every such officer to comply with such requisition. The said clause also provides that the Authorised Officer may serve an order on the owner or the person, who is in immediate possession or control of any material, that he shall not remove or part with it except with his prior permission, if the Authorised Officer considers that it is not possible or practicable to take physical possession of such material, not being stock-in-trade, to a safe place due to its volume, weight or other physical characteristics (including its dangerous nature) and such action of the authorised officer shall be deemed to be seizure. The said clause also provides that the authorised officer may, during the course of the search or seizure, examine on oath any person who is found to be in possession or control of any mater ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ays from the date on which the proceedings under the Code are completed. Clause 138 relating to delivery of material belonging to other persons, seeks to provide that the Assessing Officer, having jurisdiction over the person in whose case search and seizure was carried out under section 135, or requisition was made under section 136, shall hand over any material to the Assessing Officer having jurisdiction over another person, if he is satisfied that the material seized, or requisitioned, belongs to the other person. Clause 139 relates to retention and application of seized or requisitioned assets. The said clause seeks to provide that the Assessing Officer may recover the amount of any liability existing till the date of search or requisition or determined after such date till the release of assets out of assets seized or requisitioned or by any other mode. It further provides that the Assessing Officer may recover the existing liability and release the remaining portion of the asset, if any, within a period of one hundred and twenty days from the date on which the last of the authorisations for search under clause 135 was executed, to the person from whose custody the assets ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whom such expenditure has been incurred or any other person who is likely to posess the information regarding such expenditure, to furnish such information which may be useful for, or relevant to, any proceeding under this Code and record the statements of the person or any other person in this behalf. While exercising the power under this clause, the income-tax authority shall not remove any cash, stock or other valuable article or thing from such place. Clause 142 relates to power to disclose information in respect of any person. This clause seeks to provide that the Board, or any person specified by it by an order in this behalf, may furnish any information in respect of an assessee to other person who is performing any functions under any law relating to the imposition of any tax, duty or cess, or dealings in foreign currency or a person who is performing any function under any other law and notified by the Central Government. The said clause further provides that the Chief Commissioner or the Commissioner may furnish, or cause to be furnished, to any person any information relating to any assessee received or obtained by any income-tax authority in the performance of hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at if a person discovers any omission or any wrong statement in the return of tax bases furnished by him, he may revise such return at any time before the expiry of one year from the end of the financial year in which the return was due or before the completion of the assessment, whichever is earlier. The said clause provides that any person who is otherwise not required to furnish a return of tax bases under the Code may furnish such return before the expiry of one year from the end of the financial year to which it pertains. It also provides that a person may furnish the return for any financial year at any time before the expiry of one year from the end of the financial year in which the return was due or before the completion of the assessment, whichever is earlier, if he has not furnished a return by the due date and no notice under clause 146 has been served on him. Clause 145 relates to tax return preparers. The clause provide that the Board may frame a tax return preparer Scheme allowing a tax return preparer to prepare and furnish the return of tax bases of any specified class of persons. Clause 146 relates to the issue of notice to furnish the return of tax bases. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se also provides that the processing authority shall not send any intimation in respect of any sum payable, if the return is processed after the expiry of twelve months from the end of the financial year in which the return is furnished. It provides that the acknowledgement of the return shall be deemed to be the intimation where no sum is payable or refundable and where no adjustment has been made. The said clause provides that the Board may make a scheme for centralised processing of returns for expeditious determination of the tax payable or refundable. For this purpose, "return of tax bases" and "due date" have been defined in clause 314. In relation to adjustments, clause 149 defines "an incorrect claim apparent from the existence of any information in the return". Clause 150 relates to notice for inquiry before assessment. It provides that the Assessing Officer may make an assessment on receipt of return under clause 144 or clause 146, if he considers it necessary or expedient to ensure that the assessee has not understated his tax bases or computed excessive loss or allowance or under-paid the tax in any manner. The said clause provides that the Assessing Officer shall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erate or comply with his direction. The said clause further provides that the valuation officer shall furnish a copy of such estimate to the Assessing Officer and the assessee within a period of six months from the end of the month in which the reference was made. Clause 153 deals with the determination of arm's length price. It, inter alia, provides that the Assessing Officer may, with the prior approval of the Commissioner, refer to the Transfer Pricing Officer, the computation of arm's length price under clause 117 in relation to any international transaction entered into by the assessee in any financial year. The said clause further provides that upon such reference, the Transfer Pricing Officer shall determine the arm's length price in relation to the international transaction in accordance with the provisions of clause 117 and shall send a report of his determination to the Assessing Officer and the assessee before the expiry of a period of forty-two months from the end of the financial year in which the international transaction is entered into. Clause 154 deals with the determination of an impermissible avoidance agreement and consequences thereof. It provides that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficer shall complete the assessment on the basis of the draft order, if the assessee accepts it, or in conformity with the direction of the Dispute Resolution Panel within a period of one month from the end of the month in which such direction is received. The said clause also defines the term "eligible assessee". Clause 156 relates to best judgment assessment. It, inter alia, provides that the Assessing Officer shall make the assessment of the tax bases to the best of his judgment, if— (a) the assessee fails to furnish the return required under clause 144 or clause 146 or to comply with all the terms of a notice issued under sub-clause (1) of clause 150 or to comply with a direction issued under clause 151 or to make the return in response to notice under clause 159; (b) the assessee fails to regularly follow the accounting standards or the method of accounting laid down in clause 89; or (c) he is not satisfied about the correctness or completeness of the accounts of the assessee. The said clause further provides that in making the assessment, the Assessing Officer shall take into account all relevant material which he has gathered or is available on record. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and within a period of seven financial years from the end of the relevant financial year in any other case. The said clause also provides that where an assessment has been made under clause 155 or clause 156 or under this clause, no such notice shall be issued by an Assessing Officer below the rank of Joint Commissioner— (i) within a period of four years from the end of the relevant financial year, unless the Joint Commissioner is satisfied on the reasons recorded by such Assessing Officer that it is a fit case for issue of such notice; (ii) after the expiry of a period of four years from the end of the relevant financial year, unless the Commissioner is so satisfied; The said clause further provides that in any other case, no such notice shall be issued by an Assessing Officer below the rank of Joint Commissioner after the expiry of a period of four years from the end of the relevant financial year, unless the Joint Commissioner is satisfied on the reasons recorded by such Assessing Officer that it is a fit case for issue of such notice. The said clause also provides that any assessment proceeding relating to any financial year falling within the abovemention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch time limit shall not apply in respect of assessment, re-assessment or recomputation to be made in consequence of, or to give effect to, any finding or direction contained in any order of specified appellate authorities or of any court in a proceeding otherwise than by way of appeal or reference under this Code. The said clause also provides that in computing such period of limitation, certain specified time periods shall be excluded. It provides that the period of limitation available to the Assessing Officer for making an order of assessment, re-assessment or recomputation shall be extended to sixty days, if the period immediately after the exclusion of the specified time periods is less than sixty days. Clause 164 seeks to provide that for the purposes of this Code, "representative assessee" in respect of an assessee means— (a) the agent of a non-resident, if the assessee is a non-resident; (b) the guardian, or manager, of a minor, lunatic or idiot, if the assessee is a minor, lunatic or idiot; (c) the Court of Wards, the Administrator-General, the Official Trustee, any receiver or manager (including any person who manages property on behalf of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss reorganisation and the successor shall be assessed in respect of the income for the period beginning with the date of business reorganisation and ending on the last day of the financial year. The said clause further provides that any proceeding taken against the predecessor shall be deemed to have been taken against the successor and may be continued against the successor from the stage at which it stood on the date of the business reorganisation. Clause 169 relates to assessment of a Hindu undivided family after its partition and provides that such a family shall be deemed to continue as such except where a finding of partition has been given under this clause in respect of the Hindu undivided family. The said clause provides that the Assessing Officer, after making necessary inquiries, shall record a finding as to whether there has been a total, or partial, partition of the joint family property and, if there has been such a partition, the date on which it has taken place. The clause clarifies that no claim of partial partition of a family shall be inquired into or recognised as a partition. Further, all provisions of the Code as they applied to the Hindu undivided famil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll be in addition to the tax, if any, payable under any other provision of the Code. Clause 172 provides that where it appears to the Assessing Officer that an unincorporated body formed for a particular event or purpose in a financial year is likely to be dissolved in the financial year or shortly thereafter, then he may charge to tax in that financial year the tax bases of the unincorporated body for the period beginning from the first day of the financial year to the likely date of its dissolution. Further, the provisions of clause 171 shall apply to any proceeding under this clause as they apply in the case of a person leaving India. Clause 173 provides that where it appears to the Assessing Officer that any person is likely to charge, sell, transfer, dispose of or otherwise part with any of his assets, in any financial year, with a view to avoiding payment of any liability under this Code, then he may charge to tax in that financial year the tax bases of such person for the period beginning from the first day of the financial year to the date when the Assessing Officer commences proceedings under this clause. Further, the provisions of clause 171 shall apply to any proceed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the Assessing Officer shall assess every return filed by a deductor or collector as if it were a return of tax bases. Further, where a person has failed to file such return, the Assessing Officer shall issue a notice to the person requiring him to furnish the return within the time specified therein. All the other provisions of this Code shall apply as if the return referred to herein were a return of tax bases. Clause 178 relates to appeals before the Commissioner (Appeals) and provides that an assessee may prefer an appeal to the Commissioner (Appeals) where he is aggrieved by an order passed by any income-tax authority below the rank of the Commissioner as specified in the Twenty-first Schedule to the Code or by an intimation issued under clause 149. The said clause further provides that the assessee may also prefer an appeal where an application filed by him under clause 161 has not been disposed of by the Assessing Officer within a period of six months from the date of filing of the application or where he is required to bear the liability in respect of the tax deductible on the income payable to a non-resident under any agreement or other arrangement and he claims th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s that no appeal shall lie to the Appellate Tribunal against the order of the Commissioner (Appeals) or Commissioner in the case of a public sector company. The clause also provides that every appeal shall be preferred within the time period specified therein and allows the respondent to file a memorandum of cross-objection against any part of the order of the Commissioner (Appeals). The Appellate Tribunal may admit an appeal, or a memorandum of cross-objection, after the expiry of the period specified if it is satisfied that the appellant had sufficient cause for not preferring it within that time and the delay in filing the appeal does not exceed a period of one year. Clause 184 relates to an order of stay of demand by the Appellate Tribunal. The said clause inter alia provides that the Tribunal may grant a stay of demand to the assessee for a period of one hundred and eighty days in the first instance and extended up to a maximum period of three hundred and sixty-five days and endeavour to dispose of the appeal in such time. Clause 185 deals with the orders of the Appellate Tribunal and, inter alia, provides that the Tribunal may, after hearing both parties, pass such orde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r this clause. Clause 188 provides that an appeal filed before the High Court to be heard by a Bench of not less than two Judges of the High Court and shall be decided in accordance with the opinion of such Judges or of the majority of such Judges. Clause 189 deals with appeals before the Supreme Court and provides that an appeal shall lie to the Supreme Court from any judgment of the High Court delivered under clause 187 which the High Court certifities to be a fit case for appeal to the Supreme Court. Clause 190 relates to hearing before the Supreme Court and seeks to provide that the provisions of the Code of Civil Procedure, 1908, relating to appeals to the Supreme Court shall apply in the case of appeals under section 189 as they apply in the case of appeals from decrees of a High Court. The said clause also provides that where the judgment of the High Court is varied or reversed in the appeal, effect shall be given to the order of the Supreme Court in the manner provided in section 187. Clause 191 deals with revision of orders prejudicial to revenue and, inter alia, seeks to provide that the Commissioner may revise any order passed by any income-tax authority subord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or advance payment. The clause seeks to provide that the tax on any income shall be payable by deduction or collection at source or by advance payment, as the case may be, in accordance with the provisions of this Chapter, notwithstanding that the regular assessment in respect of such income is to be made in a later financial year. Sub-clause (2) of the said clause is an overriding provision stipulating that nothing in this clause shall prejudice the charge of tax on such income under the provisions of sub-clause (2) of clause 2. Clause 194 relating to direct payment seeks to provide that the tax on income has to be paid directly by the person if there is no provision under this Chapter for deduction or collection of income-tax at the time of payment or income-tax has not been deducted or collected in accordance with the provisions of this Chapter. Sub-clause (2) of the said clause provides that any person who is required to deduct or collect any sum in accordance with the provisions of the Code does not deduct or collect, or after so deducting or collecting fails to pay the whole or any part of the tax required to be collected or deducted under the Code, and where the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... suance of an agreement or arrangement, the payment has to be grossed up to such amount as would, after deduction of tax thereon at the appropriate rate, be equal to the net amount payable under such agreement or arrangement. Clause 197 seeks to empower the Assessing Officer to give a certificate for lower or no deduction of tax to the deductee where the deductee is a resident or to the deductor where the deductee is a non-resident, if the Assessing Officer is satisfied that the total income of the deductee justifies deduction of tax at a lower or nil rate. Accordingly, the clause provides that deduction shall be made in accordance with the certificate, until such certificate is cancelled by the Assessing Officer or the expiry of the validity of the certificate, whichever is earlier. Clause 198 relating to obligations of deductor, seeks to provide that every deductor shall pay the sum deducted to the credit of the Central Government within the prescribed time and manner, furnish a certificate to the deductee and also deliver a return of tax deduction in the manner provided in clause 199. Clause 199 relates to payments to resident without deduction of tax. The said clause seeks ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te amount of the payments during the financial year does not exceed seventy-five thousand rupees; (j) any payment of rent, if the aggregate amount of the payments during the financial year does not exceed one lakh eighty thousand rupees; (k) any payment of compensation on compulsory acquisition of immovable property, if the aggregate amount of the payments during the financial year does not exceed two lakh rupees; Further, in the case of a non-resident deductee, being a foreign institutional investor, deduction shall not be made on any payment made to it as a consideration for sale of securities listed on a recognised stock exchange. Clause 201 relating to credit for tax deducted, seeks to provide that for the purposes of computing total income of a deductee, the sum deducted on payments made to him shall be deemed to be his income received. Further the clause seeks to provide that the sums which have been deducted and paid to the Central Government, shall be treated as a payment of tax on behalf of the deductee. The clause further seeks to empower the Board to prescribe the procedure for giving credit to the deductee, the financial year for which such credit may be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tax on estimated total income is reduced by the tax deductible or collectible at source and the amount of any tax credit available under clause 207. The said clause further provides that persons other than companies are liable to pay advance income-tax, in three instalments i.e. on or before 15th September, 15th December and 15th March. Amount payable by these three dates should amount to 30 per cent., 60 per cent. and 100 per cent of the advance-tax payable. Similarly for a company, there are four instalments, the dates being on or before 15th June, 15th September, 15th December and 15th March. The corresponding percentages in the case of a company are 15 per cent., 45 per cent, 75 per cent and 100 per cent. It is further provided that any amount of advance income-tax paid after 15th March but before the expiry of the financial year shall be treated as advance income-tax paid during the financial year. The said clause also empowers the Assessing Officer to issue an order to an assessee (not after last date of February of the financial year) to pay advance income-tax in such instalments as specified in the order, if in the opinion of the Officer, the assessee is liable to pay s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is interest is chargeable are where the assessee is liable to pay advance income-tax and has failed to pay such tax, or where the advance income-tax paid by such assessee is less than ninety per cent. of the assessed tax. This clause further provides the method of computation of the period for, and the amount on, which the interest is chargeable. The interest is payable at the rate of one per cent. per month. The interest shall be increased or reduced, in accordance with the variation in the amount of tax on which interest was payable under this clause. Clause 211 relates to interest for deferment of advance income-tax. The clause seeks to provide that where an assessee who is liable to pay advance income-tax has failed to pay such tax or has paid lesser advance tax before the due dates as specified, he shall be liable to pay simple interest at the rate of one per cent. per month for a period of three months. The said clause also specifies the manner in which the interest has to be calculated. The interest shall not be payable on any shortfall in the advance income-tax payable on account of under-estimation or failure to estimate the amount of capital gains and income of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clude the period of delay attributable to the assessee. The said clause also provides that an assessee shall be entitled to receive simple interest at the rate of one-half per cent. per month on the amount of interest receivable by him under this clause for the period from the date of grant of refund to the date of actual payment of such interest, if such interest is not paid to him along with the refund. Clause 217 seeks to provide for persons who shall be entitled to claim refund in certain special cases like on account of death, incapacity, insolvency, liquidation, etc., of the person entitled to claim the refund in first place. Clause 218 relating to recovery by Assessing Officer seeks to provide that any amount specified as payable in a notice of demand, otherwise than by way of advance tax, shall be paid within thirty days of the service of the notice, to the credit of the Central Government. This period, however, can be reduced with the previous approval of the Joint Commissioner if the Assessing Officer has reason to believe that full period shall be detrimental to the interest of revenue. The said clause further provides that the Assessing Officer can extend the ti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t within a period of thirty days and thereafter, the Assessing Officer shall intimate to the liquidator, within a period of three months the amount sufficient to provide for any tax arrears or any amount which is likely to become payable thereafter by the company. The liquidator shall not part with any of the assets of the company, or the properties, in his custody until he has been intimated by the Assessing Officer. The amount so intimated shall be the first charge on the assets of the company remaining after payment of the workmen's dues and debts due to secured creditors to the extent specified. Clause 224 relating to liability of manager of a company, seeks to provide that every person being a manager at any time during the financial year shall be jointly and severally liable for the payment of any amount due under the Code in respect of the company for the financial year, if the amount cannot be recovered from the company. These provisions shall not apply, if the manager proves that non-recovery cannot be attributed to any neglect, misfeasance or breach of duty on his part in relation to the affairs of the company. The provisions of this section shall prevail over anything ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he liability) to pay the whole, or any part, of the amount payable under the Code by any person required to obtain a no objection certificate if the person leaves India without obtaining the certificate. Clause 229 relates to recovery by suit not with any other law. The said clause seeks to provide that the several modes of recovery specified in this Chapter shall not affect in any way any other law for the time being in force relating to the recovery of debts due to Government, or the right of the Government to institute a suit for the recovery of the tax arrears from the assessee. Clause 230 deals with penalty for under-reporting of tax bases. It provides that a person shall be liable to a penalty, if he has under reported the tax bases for any financial year, of a sum which shall not be less than, but which shall not exceed two times, the amount of tax payable in respect of the amount of tax bases under reported for the financial year. The said clause provides that the amount of tax bases under reported shall be the aggregate amount of the addition or disallowance made by the Assessing Officer, the Commissioner or the Commissioner (Appeals), as the case may be. It lists th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall be punishable with rigorous imprisonment and with fine. The said clause also provides the term and quantum of such punishment. Clause 237 provides that if a person who is required to afford the authorised officer the necessary facility to inspect the books of account or other documents under item (d) of sub- clause (2) of clause 135, fails to afford such facility, he shall be punishable with rigorous imprisonment and with fine. The said clause also provides the term and quantum of such punishment. Clause 238 deals with removal, concealment, transfer or delivery of property to thwart tax recovery. It provides that whoever fraudulently removes, conceals, transfers or delivers to any person, any property or any interest therein, with the intention of preventing such property or interest therein from being taken in execution of a certificate under the provisions of the Fifth Schedule shall be punishable with rigorous imprisonment and with fine. The said clause also provides the term and quantum of such punishment. Clause 239 provides that if a person fails to give information as required by sub-clause (1) of clause 223 or fails to set aside the amount as required by sub-cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o provides for separate term and quantum of such punishment in respect of a case where the amount sought to be evaded exceeds one lakh rupees and other cases where it does not. The said clause also provides that a person shall not be so proceeded against for failure to furnish in due time the return of tax bases under certain specified circumstances. Clause 243 provides that if a person wilfully fails to produce, or cause to be produced, the accounts and documents on or before the specified date as required by any notice served on him under sub-clause (2) of clause 150, he shall be punishable with rigorous imprisonment or with fine or with both. The said clause provides the term and quantum of such punishment. Clause 244 provides that if a person wilfully fails to comply with a direction issued to him under sub-clause (1) of clause 151, he shall be punishable with rigorous imprisonment or with fine or with both. The said clause provides the term and quantum of such punishment. Clause 245 provides that if a person makes a statement in any verification under this Code or under any rule made thereunder or delivers an account or statement which is false and which he either know ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceeded against and punished accordingly. The said clause also provides that where an offence under this Code has been committed by a company and the punishment for such offence is imprisonment and fine, then the company shall be punished with fine and every person referred to in the preceding paragraphs shall be liable to be proceeded against and punished in accordance with the provisions of this Code. The said clause defines the terms "company" and "director". Clause 249 deals with proof of entries in records or documents. It provides that entries in the records or other documents which are in the custody of an income-tax authority shall be admitted in evidence in any proceeding for the prosecution of any person for an offence under this Chapter. The said clause further provides that the entries may be proved by the production of the records or other documents (containing such entries) which are in the custody of the income-tax authority or by the production of a copy of the entries certified by that authority under its signature as true copy of the original entries. Clause 250 deals with presumption as to assets, books of account, etc., in certain cases. It provides that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ides that if any person convicted of an offence under clauses 240, 241, 242, 243, 245, 246 and 247 is again convicted of an offence under any of the said provisions, he shall be punishable for the second and every subsequent offence with rigorous imprisonment and with fine. The said clause provides the term of such punishment. Clause 254 provides that any offence punishable under this Chapter shall be deemed to be non-cognizable within the meaning of the Code of Criminal Procedure, 1973, notwithstanding anything contained in that Code. Clause 255 deals with disclosure of information by public servants. It provides that if a public servant furnishes any information or produces any document in contravention of the provisions of clause 142, he shall be punishable with imprisonment and with fine. It also provides the term of such punishment. The said clause provides that no prosecution shall be instituted under this clause except with the previous sanction of the Central Government. It also provides that such sanction may be accorded only after giving the public servant an opportunity of being heard. Chapter XVI of the Code deals with advanced rulings and disputes resolutions. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y shall be binding only on the applicant in whose case, and in respect of the transaction in relation to which, the ruling has been pronounced. It shall also be binding on the Commissioner, and the income-tax authorities subordinate to him, in respect of the applicant and the said transaction. The said clause further provides that the advance ruling shall not be binding if there is a change in law, or fact, on the basis of which the advance ruling has been pronounced. Clause 261 seeks to provide that the Authority may declare an advance ruling to be void ab initio if it finds that the ruling has been obtained by the applicant by fraud or misrepresentation of facts and in such case, all the provisions of the Code shall apply to the applicant as if such advance ruling had never been made. Clause 262 relates to the procedure for dispute resolution. The said clause, inter alia, provides that a public sector company or Commissioner may file an appeal against the orders referred to in clause 256 for seeking resolution of a dispute and such appeal shall be preferred within the specified period. Further, it allows the respondent to file a memorandum of cross-objection against any par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in the service, including at least 5 years in the rank of Commissioner or above. Clause 269 relates to jurisdiction and powers of the Settlement Commission. The said clause seeks to provide that a Bench of the Commission would be presided over by the Chairperson or a Vice-Chairperson, and would consist of two other members. However, if third member is unable to discharge his functions or in case of vacancy, the Bench may function with only two members. The Bench headed by the Chairperson will be the principal Bench and other Benches will be called Additional Benches. The Chairperson may, for the disposal of any particular case, constitute a Special Bench consisting of more than three Members. These Benches would sit at the notified places except a Special Bench which will sit at a place to be fixed by the Chairperson. Clause 270 seeks to provide that if there is vacancy in the office of Chairperson or if he is not in a position to discharge his duties, the notified Vice-Chairperson shall act as the Chairperson. Clause 271 seeks to provides for power of Chairperson to transfer cases from one Bench to another which can be done on the application of the assessee or the Chief C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... settlement and specifies the time limit for payment of tax in pursuance of the order of the Settlement Commission under section 277, circumstances of its extension, etc. It also provides that simple interest at the rate of fifteen per cent. per annum shall be payable on any default from the date of the expiry of period of thirty days of the receipt of the order of Settlement Commission under clause 277. Clause 279 relates to power of Settlement Commission to order provisional attachment to protect revenue and, inter alia, provides for time limits for which such attachments shall be effective. Clause 280 relates to revival of proceedings before Assessing Officer. The said clause provides that if the order passed by the Settlement Commission becomes void in the circumstances where it was obtained by fraud or misrepresentation, the proceedings before the Assessing Officer with respect to the matters covered by the settlement shall be deemed to have been revived from the stage at which the application was admitted by the Settlement Commission and the Assessing Officer will get twenty-one months from the end of the financial year in which the order becomes void, to frame the assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid clause seeks to provide the circumstances when a person shall not be entitled to file subsequent application before the Settlement Commission and the exceptions in this regard. Clause 289 seeks to provide that any proceeding before the Settlement Commission shall be a judicial proceeding within the meaning of sections 193 and 228, and for the purposes of section 196 of the Indian Penal Code. Clause 290 seeks to provide certain interpretations relevant for Chapter XV. Part—H and Chapter XVIII of the Code deal with general provisions. Clause 291 relates to agreement with specified territory or foreign countries. The said clause seeks to provide that the Central Government may enter into an agreement with the Government of any country or specified territory for the granting of relief or avoidance of double taxation, for exchange of information for the prevention of evasion or avoidance of income-tax or wealth-tax, for tax recovery, etc. Where for such agreements, the other country has designated certain associations, the clause provides that any specified association in India may enter into such agreement with the specified association of the specified territory outside In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... transaction of purchase, sale of property, a transaction by way of an investment made or an expenditure incurred, etc. The return is required to be furnished for transactions above a specified limit. The said clause also provides the time and manner of filing of such return, the circumstances in which it would be treated as defective, etc. Clause 296 relates to certain transfers to be void. The said clause seeks to provide that a transfer of asset or creation of charge on it during the pendency of any proceeding under the Code or after completion shall be void as against any claim in respect of any sum payable unless made for adequate consideration and without knowledge of the pendency of such proceeding or of any such sum payable by the person or with the previous permission of the Assessing Officer. However, the provisions of this clause shall not apply to transfer of any business trading asset. Clause 297 relates to provisional attachment to protect revenue in certain cases. The said clause seeks to provide that the Assessing Officer can provisionally attach any property belonging to the assessee to protect interest of revenue, with prior approval of the Chief Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tes to rounding off of tax bases, tax, etc. It provides for rounding off of tax-bases to the nearest multiple of hundred rupees and amount payable or receivable by an assessee to the nearest multiple of ten rupees. Clause 306 relates to indemnity. The said clause seeks to provide that every person deducting, retaining, or paying any tax in pursuance of the Code in respect of income belonging to another person is indemnified for the deduction, retention, or payment thereof. Clause 307 relates to power to tender immunity from prosecution. The said clause seeks to empower the Central Government to tender immunity to any person from prosecution and the imposition of penalty on fulfilment of certain conditions. The immunity can also be withdrawn also in specified circumstances like concealment of particulars for obtaining immunity, giving of false evidence, etc. Clause 308 relates to cognizance of offences. The said clause seeks to provide that no court inferior to that of a metropolitan magistrate or a magistrate of the First Class will try any offence under the Code. Clause 309 seeks to provide that the provisions of section 360 of the Code of Criminal Procedure, 1973, or the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lause further provides that any direction for aggregation of two or more items expressed as amounts shall be construed also to include a direction for aggregation of negative and positive amounts in all their combinations. The said clause also provides that the value of any variable in a formula shall be deemed to be nil, if the value of such variable is indeterminable or unascertainable. Clause 316 relates to power to make rules and seeks to empower the Board to notify rules for the purposes of the Code subject to the control of the Central Government. The said clause seeks to provide power in general terms as well as in specific matters mentioned therein like the ascertainment and determination of any class of income, the manner of arriving at the income in case of agriculture, a person residing outside India, the form and manner in which any document, application, claim, return or information may be made or furnished, the fee that may be payable, the authority to be prescribed for any of the purposes of the Code, the procedure of giving effect to the terms of any agreement for avoidance of double taxation etc. The clause further seeks to provide that the power to make ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is proposed to be provided to themvis-à-vis other resident tax-payers. The Schedule also provides for a flat rate of tax for a non-profit organisation after a threshold limit. Part II of the Schedule seeks to provide the method of aggregation of agricultural income for rate purposes in a case where the person to whom Part I is applicable, has net agricultural income during a year exceeding 5000 rupees, and total income exceeds the threshold limit. Part III seeks to provide rates of taxation if the person has income from any special source. The rates listed pertain to a non-resident or where the person, whether resident or non-resident, has income by way of lottery, crossword puzzle, race, including horse race or card game or any other game or gambling or betting. The Second Schedule seeks to provide rates of other taxes, namely, tax on book profit, tax on distributed profits (dividend) of a domestic company tax on distributed income-tax on branch profits and tax on net wealth. The Third Schedule seeks to provide a list of specified payments and the appropriate rates on which deduction of tax at source is required to be made in the case of a resident deductee. The Fourth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conditions. The Schedule also provides for notification of income in certain cases by the Central Government for this purpose. Clause 11 of this Code provides that certain persons shall not be liable to income-tax for any financial year. Accordingly, the Seventh Schedule of the Code enumerates such persons. In certain cases, the Schedule provides that the persons shall not be so liable to income-tax, subject to the fulfilment of conditions stipulated therein. In other cases, the entity shall be completely exempt from tax without any conditions. Sub-clause (2) of clause 32 of this Code, inter alia, provides that the income from the business of insurance is to be computed in accordance with the Eighth Schedule. Accordingly, the Eighth Schedule seeks to provide that the profits of the business of life insurance shall be the profit determined in the Shareholders' Account (Non-Technical Account) in accordance with the Insurance Act, 1938 as increased and reduced by items specified in the said Schedule. Similarly, it is provided that the profits of the business of insurance other than life insurance shall be the profits disclosed in the annual accounts, copies of which are requir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall be the gross income from such business as reduced by the amount of the business expenditure incurred by the assessee wholly and exclusively for the purpose of such business. It further provides that the computation of such profits shall be presumed to have been given after giving effect to loss, allowance or deduction under this Code. It also provides that the amount of common costs attributable to such business shall be determined in the prescribed manner. The circumstances under which the provisions of this Schedule shall apply have also been specified therein. It also defines various terms for the purpose of computation of such profits. Sub-clause (2) of clause 32, inter alia, provides that the profits from the business of developing a Special Economic Zone or manufacture or production of article or things or providing of any service by a unit established in a Special Economic Zone shall be computed in accordance with the provisions contained in the Twelfth Schedule. Accordingly, the Twelfth Schedule provides that the profits of the business of developing or operating from a Special Economic Zone or manufacture or production of article or things or providing of any ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovides that the computation of such income shall be presumed to have been made after giving effect to loss, allowance or deduction under this Code. It also provides that the amount of common costs attributable to such business shall be determined in the prescribed manner. The circumstances under which the provisions of this Schedule shall not apply have also been specified therein. The Fifteenth Schedule relates to depreciation. Depreciation of business capital assets is one of the capital allowances allowed under clause 37 of the Code. The manner of calculation of depreciation of business capital assets is provided in clause 38 of the Code. The said clause makes a reference to Fifteenth Schedule. In respect of any block of assets , the depreciation is to be allowed at the percentages specified against such block of assets in the Table given in the said Schedule on the adjusted value or written down value of such block of assets, as the case may be, as are used for the purposes of the business of the person at any time during the financial year. The said Table broadly divides business capital assets, into twelve classes of assets. These are building, furniture and fittings, vehic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and functioning. The said Schedule has three parts. Part I deals with approved provident funds, Part II with approved superannuation funds and Part III with approved gratuity funds. Part I relating to approved provident funds, provides that the Commissioner shall accord or withdraw approval to a provident fund and the conditions, upon the satisfaction of which he will accord approval to such fund, have been specified. In certain circumstances, the conditions can also be relaxed. This Part also provides that certain funds established under a scheme of other specified Acts will be deemed to be approved if notified in this behalf. The said Part also provides that contribution by an employer in excess of twelve per cent. of the salary or one lakh rupees, whichever is less, and interest credited in excess of the rate of interest prescribed by the Central Government for this purpose, shall be deemed to be the income of the concerned employee and shall be liable to income-tax. Besides, an employee will be entitled to a deduction in computation of his income in respect of his contribution to his account, subject to a specified limit. Part II of the Schedule relates to approved super ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ain terms like "Controlled Foreign Company", "territory with a lower rate of taxation" and "associated enterprise". Clause 178 provides that an assessee may prefer an appeal to the Commissioner (Appeals) where he is aggrieved by an order passed by an income-tax authority below the rank of Commissioner, as specified in the Twenty-first Schedule. Accordingly, the Schedule provides a list of orders that are appealable before the Commissioner (Appeals). Clause 37 of this Code, inter alia, provides that one of the items of capital allowances viz. deferred revenue expenditure allowance shall be such proportion of the expenditure as specified and computed in accordance with the Twenty-second Schedule. Accordingly, the said Schedule seeks to provide the items of deferred revenue expenditure on which deferred revenue expenditure allowance would be available for a financial year. The items provided, inter alia, are non-compete fee, premium for obtaining any asset on lease or rent, amount paid to an employee in connection with his voluntary retirement, expenditure incurred by an Indian company, any loss on account of forfeiture of any agreement entered in the course of the business and pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he deductions from the gross salary for computation of income from employment. These deductions include - any allowance or benefit granted by an employer for journey by an employee between his residence and office or any other place of work, to such extent as may be prescribed; any allowance or benefit granted by an employer to an employee to meet expenses wholly, necessarily and exclusively in the performance of the duties of an office or employment of profit, as may be prescribed, to the extent such expenses are actually incurred for that purpose, and to meet personal expenses, considering the place of posting or nature of duties or place of residence, subject to such conditions and limits as may be prescribed; any amount of interest credited, in the financial year, on the balance to the credit of an employee in an approved fund to the extent it does not exceed the amount of interest payable at the rate notified by the Central Government; any allowance provided by an employer to meet the expenditure actually incurred on payment of rent in respect of residential accommodation occupied by the employee, to such extent as may be prescribed. Accordingly, it is proposed to empower th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xtent prescribed which it is in accordance with the agreement of formation of unincorporated body and relates to the period falling after the date of such agreement; the proportionate amount of discount or premium payable on any bond or debenture issued by the person, calculated in the manner as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 9. Clause 37 of the Bill provides deduction of an amount in accordance with such deposit scheme in respect of the person carrying on business of growing and manufacturing tea or coffee or rubber in India, as may be prescribed. Accordingly, it is proposed to empower the Central Government to make the rules in this regard. 10. Clause 41 of the Bill provides that a company shall be allowed a deduction equal to two hundred per cent. of the expenditure (not being expenditure in the nature of cost of any land or building) incurred on creating and maintaining an in-house facility for scientific research and development; and carrying out scientific research and development in the inhouse facility, if— (a) the company creates and maintains an in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Accordingly, it is proposed to empower the Central Government to issue notification(s) in this regard for the purposes of this clause. 16. Clause 47 further provides that the transfer of any investment asset in a transaction of reverse mortgage under a scheme notified by the Central Government shall not be included in the computation of income under the head "Capital gains". Accordingly, it is proposed to empower the Central Government to frame the scheme in this regard for the purposes of this clause. 17. Clause 58 of the Bill provides that the gross residuary income shall inter alia include any payment or aggregate of payments made to a person in a day, otherwise than by an account payee cheque drawn on a bank or account payee bank draft, if it has not been incurred in such cases and under such circumstances, as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 18. Clause 59 of the Bill provides that for the purposes of computation of income from residuary sources, any payment or aggregate of payments made to a person in a day, otherwise than by an account payee cheque drawn on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oses of this clause. 22. Clause 77 of the Bill provides that a person, being resident individual, shall be allowed a deduction of one lakh rupees, if he is a person with severe disability; and of fifty thousand rupees, if he is a person with disability. This deduduction shall be allowed if the person obtains a certificate from a medical authority in the prescribed form and manner and the certificate remains valid during the relevant financial year or part thereof. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 23. Clause 78 of the Bill provides that the deduction under this clause shall be allowed if the person, claiming a deduction under this section, obtains a certificate from a medical authority in such form and manner as may be prescribed and the certificate remains valid during the relevant financial year or part thereof. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 24. Clause 79 of the Bill provides that the donation to any person specified in Part IV of the Sixteenth Schedule shall be eligible for deduction unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dingly, it is proposed to empoer the Central Government to make rules in this regard for the purposes of thi clause. 30. Clause 87 of the Bill further provide that the Board may, having regard to the nature of the business carried on by any class of persons, prescribe- (a) any other books of account and documents to be kept and maintained; (b) the particulars to be contained in the books of account and documents; and (c) the form and the manner in, and the place at, which the books of account and other documents shall be kept and maintained. The Board may, also prescribe the period for which the books of account and other documents required to be kept and maintained under this section shall be retained. Accordingly, it is proposed to empower the Board to make rules in this regard for the purposes of this clause. 31. Clause 88 of the Bill provides that every person, who is required to keep and maintain books of account under clause 87 shall get his accounts for the financial year audited. The report of this audit shall be obtained in the prescribed form duly signed and verified by such accountant and setting forth such particulars as may be prescribed. A person shall be deemed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shall include any amount applied outside India, if - (i) the amount is applied for an activity which tends to promote international welfare in which India is interested; and (ii) the non-profit organisation is notified by the Central Government in this behalf. Accordingly, it is proposed to empower the Central Government to issue notifications in this regard for the purposes of this clause. 36. Clause 94 of the Bill further provides that the amount of outgoings during the financial year for the purpose of computation of the total income shall be the aggregate of the amounts specified therein. These amounts include any amount accumulated or set apart for carrying on any charitable activity- (i) to the extent of fifteen per cent. of the total income (before giving effect to the provisions of this clause) or ten per cent. of the gross receipts, whichever is less; and (ii) invested or deposited in the modes specified in clause 95, for a period not exceeding three years from the end of the financial year. The modes of investing or depositing the money in such activity include any other mode of investment or deposit as may be prescribed. Accordingly, it is proposed to empower the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such form as may be prescribed from an accountant certifying that the book profit has been computed in accordance with the provisions of this clause. Accordingly, it is proposed to empower the Central Government to make rules and issue forms in this regard for the purposes of this clause. 42. Clause 108 of the Bill provides that the venture capital company, the venture capital fund or the person responsible for making payment of the income on behalf of such company or fund shall furnish, within such time as may be prescribed, to the person receiving such income and to the prescribed income-tax authority, a statement in the prescribed form and manner, giving details of the nature of the income paid during the financial year and such other relevant details as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for th purposes of this clause. 43. Clause 110 of the Bill provides that every life insurer shall be liable to pay tax on any amount of income, computed in the manner prescribed, distributed or paid to the policy holders of an approved equity oriented life insurance scheme. Accordingly, it is proposed to empowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n respect of general anti-avoidance rule shall apply in accordance with such guidelines as may be prescribed. Accordingly, it is proposed to empower the Central Government to frame the guidelines in this regard for the purposes of this clause. 50. Clause 124 of the Bill provides that for the purposes of the Chapter on "Special Provisions Relating ToAvoidance Of Tax", two enterprises shall be deemed to be associated enterprises at any time during the financial year, if they are associated with each other by virtue of the conditions specified in the said clause. These conditions include - 'any specific or distinct location of either of the enterprises as may be prescribed'; 'any other relationship of mutual interest, existing between the two enterprises, as may be prescribed'. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purpose of this clause. 51. Clause 127 of the Bill further provides that the Board may, by notification, direct that any income-tax authority or thorities specified in the n ification shall be subordinate to such other income-tax authority or authorities as may be specified in such notification. Accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further provides that the Board, or any person specified by it by an order in this behalf, may furnish, or cause to be furnished, any information in respect of an assessee to any other person performing any functions under any other law as the Central Government may, if in its opinion it is necessary so to do in the public interest specify by notification in this half. Accordingly, it is proposed to empower the Central Government issue notification in this regard for the purposes of this clause. 57. Clause 144 of the Bill provides that every person shall furnish a return of tax bases on or before the due date to the Assessing Officer or such other authority or agency as may be prescribed. Accordingly, is proposed to empower the Central Government to make rules in this regard for the rposes of this clause. 58. Clause 144 of the Bill further provides that the person required to furnish a return of tax bases in relation to income shall also include; besides those enumerated in the said clause, any class or classes of persons as may be prescirbed. Accordingly, it is proposed to empower the Central Government to make rules/issue notification in this regard for the purposes of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es of this clause. 65. Clause 159 of the Bill provides that for reopening a case, the Assessing Officers all serve on the assessee a notice requiring him to furnish, within a period of thirty days, a return of tax bases for any financial year, in such form, verified in the manner and setting forth such other particulars as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules/forms in this regard for the purposes of this clause. 66. Clause 162 of the Bill provides that any sum payable in consequence of any order made, or intimation issued, under this Code shall be demanded by an income-tax authority by serving upon the assessee a notice of demand in such form and manner as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules/forms in this regard for the purposes of this clause. 67. Clause 179 of the Bill provides that every appeal under clause 178 to Commissioner (Appeals) shall be in such form and verified in such manner and accompanied by a fee as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules/forms in this regard for the purposes of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... received by him. Further, the deductor may make an application, in such form and manner as may be prescribed, to the Assessing Officer seeking a certificate for deduction of income-tax at a lower rate or, as the case may be, no deduction of income-tax from payments to be made by him to a non-resident deductee. Accordingly, it is proposed to empower the Central Government to make rules/forms in this regard for the purposes of this clause. 74. Clause 197 of the Bill further provides that the Board may prescribe the circumstances and the cases in which an application may be made for the grant of the certificate for lower or no deduction of tax and the conditions subject to which such certificate may be granted and provide for all other matters connected therewith. Accordingly, it is proposed to empower the Board to make rules in this regard for the purposes of this clause. 75. Clause 198 of the Bill provides that every deductor shall pay the sum deducted to the credit of the Central Government with such time and manner as may be prescribed. Further, every deductor shall furnish to the deductee a certificate to the effect that tax has been deducted within such time and containi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... source, the collection of an amount shall be deemed to have been made, if the amount has been received in cash; by way of a cheque or draft; by debit to any account, whether called "suspense account" or by any other mode as may be prescribed, whichever is earlier. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 81. Clause 202 of the Bill further provides that any person collecting any amount in the form of tax collected at source shall pay the sum so collected to the credit of the Central Government within such time and manner as may be prescribed. Also, every person responsible for collecting any amount the form of tax collected at source shall furnish to the buyer, lessee or licensee a certificate of tax collection within such time as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 82. Clause 202 of the Bill further provides that the Board shall prescribe the following in respect of the return of tax collection:— (a) the period in respect of which the return is to be furnished; (b) the for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elief as may be prescribed, if the person is in receipt in any financial year of any arrears, or advance, of salary or family pension relating to any other financial year. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 87. Clause 207 of the Bill provides that the Central Government may, for the relief or avoidance of double taxation, prescribe,— (a) the method for computing the amount of credit; (b) the manner of claiming credit; and (c) such other particulars as may be considered necessary. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 88. Clause 210 of the Bill provides that in relation to interest for default in furnishing return of tax-bases, the Assessing Officer shall serve on the assessee a notice of demand, in such form as may be prescribed, specifying the sum payable on account of increase in the interest payable as a result of modification in the assessed income on account of any rectification, revision or appellate order under the Code, and such notice shall be deemed to be a notice under s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f an assessee in default referred to in sub-section (3) or sub-section (4) of section 213, in the prescribed form. Accordingly, it is proposed to empower the Central Government to issue the forms in this regard for the purposes of this clause. 94. Clause 220 of the Bill provides that the Assessing Officer or the Tax Recovery Officer may require the employer of the assessee to deduct from any payment to the assessee such amount as is sufficient to meet the tax arrear from the assessee. Upon such requisition, the employer shall comply with the requisition and shall pay the sum so deducted to the credit of the Central Government in the prescribed manner. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 95. Clause 220 of the Bill further provides that the Assessing Officer or the Tax Recovery Officer may, by notice in writing, require any debtor of the assessee to pay such amount, not exceeding the amount of debt, as is sufficient to meet the tax arrear of the assessee. Upon receipt of such notice, the debtor shall comply with the requisition and shall pay the sum to the credit of the Central Government ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the Chief Commissioner may compound, either before or after the institution of proceedings, any offence under Chapter XV, under the circumstances and for the amount, as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 101. Clause 256 of the Bill provides that an applicant or appellant, being any class of residents as notified by Central Government in the Official Gazette in this behalf, may seek a ruling or, as the case may be, a resolution of dispute on matters concerning a determination in respect of an issue relating to computation of tax bases is pending before any income-tax authority, or the Appellate Tribunal, and such determination shall include the determination of any question of law or of fact relating to such computation of tax bases specified in the application. Accordingly, it is proposed to empower the Central Government to make rules and issue notifications in this regard for the purposes of this clause. 102. Clause 257 of the Bill provides that in respect of the Authority for Advanced Rulings and Dispute Resolution, the salaries and allowances payable to, and th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the case may be, one of the Vice-Chairperson as the Central Government may, by notification in the Official Gazette, authorise in this behalf, shall act as the Chairperson. Accordingly, it is proposed to empower the Central Government to issue notifications in this regard for the purposes of this clause. 109. Clause 273 of the Bill provides that an assessee may, at any stage of a case relating to him, make an application to the Settlement Commission in such form and manner as may be prescribed, to have the case settled. Such application shall contain, besides the specified particulars, such other particulars as may be prescribed. It has also been provided that every application made to the Settlement Commission shall be accompanied by such fees as may be prescribed. Further, the assessee shall, on the date on which he makes such an application to the Settlement Commission, also intimate the Assessing Officer in such manner as may be prescribed, of having made such application to the Settlement Commission. Accordingly, it is proposed to empower the Central Government to make rules and forms in this regard for the purposes of this clause. 110. Clause 282 of the Bill prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... empower the Central Government to make rules in this regard for the purposes of this clause. 114. Clause 292 of the Bill further provides that the Board shall prescribe the following in respect of the permanent account number: (a) the form and the manner in which an application may be made for the allotment of a permanent account number and the particulars which such application shall contain; (b) the income-tax authority, or any other person, authorised to receive the application or allot the permanent account number; (c) the categories of transactions in relation to which Permanent Account Numbers shall be quoted by every person in the documents pertaining to such transactions; (d) the categories of documents in which such numbers shall be quoted by every person; (e) class, or classes, of persons to whom the provisions of this section shall not apply; (f) the form and the manner in which the person who has not been allotted a Permanent Account Number shall make his declaration; (g) the manner in which the Permanent Account Number shall be quoted in respect of the categories of transactions referred to in clause (c) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ower the Central Government to make rules in this regard for the purposes of this clause. 120. Clause 295 of the Bill further provides that the annual information return in respect of the financial transactions shall be furnished if the aggregate value of each such transaction in any financial year exceeds the amount as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 121. Clause 295 of the Bill further provides that the prescribed income-tax authority may, if he considers that the annual information return furnished is defective, intimate the defect to the person who has furnished such return and give him an opportunity of rectifying the defect within a period of one month from the service of such intimation. Further, the prescribed income-tax authority shall treat the annual information return as invalid if such defect is not removed within the time allowed, and the provisions of the Code shall apply as if such person had failed to furnish the annual information return. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oposed to empower the Central Government to frame the scheme in this regard for the purposes of this clause. 127. Sub-clause (31) of clause 314 of the Bill defines "backward classes" to mean such classes of citizens, other than the Scheduled Castes and the Scheduled Tribes, as may be notified, from time to time, by the Central Government or any State Government. Accordingly, it is proposed to empower the Central Government and the State Governments to issue notifications in this regard for the purposes of this clause. 128. Sub-clause (34) of clause 314 of the Bill defines "Board" to mean the Central Board of Direct Taxes constituted under the Central Boards of Revenue Act, 1963 and notified by the Central Government for the purposes of this Code. Accordingly, it is proposed to empower the Central Government to issue notification in this regard for the purposes of this clause. 129. Sub-clause (36) of clause 314 of the Bill defines "broken-period income" to mean the income for the period commencing from the date on which the debt instrument is acquired by the person or the beginning of the financial year, whichever is later, and ending on the date on which the security is s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rules in this regard for the purposes of this clause. 135. Sub-clause (87) of clause 314 of the Bill defines "electoral trust" to mean a trust so approved by the Board in accordance with the scheme made in this regard by the Central Government. Accordingly, it is proposed to empower the Central Government to make the scheme in this regard for the purposes of this clause. 136. Sub-clause (93) of clause 314 of the Bill defines "fair market value", in relation to an asset, to mean the price determined in such manner as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 137. Sub-clause (112) of clause 314 of the Bill defines "head office expenditure" to mean executive and general administration expenditure incurred by the assessee outside India, including expenditure incurred in respect of, in addition to the matters specified therein, such other matters connected with administration as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 138. Sub-clause (159) of Clause 314 of the Bill define ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 241) of clause 314 of the Bill defines "specified knowledge-based industry or service" to mean any other industry or service, other than those specified therein, as may be notified by the Central Government. Accordingly, it is proposed to empower the Central Government to issue notification in this regard for the purposes of this clause. 145. Sub-clause (242) of clause 314 of the Bill defines "specified territory" to mean any area outside India and notified as such by the Central Government. Accordingly, it is proposed to empower the Central Government to issue notification in this regard for the purposes of this clause. 146. Sub-clause (250) of clause 314 of the Bill defines "State Pooled Finance Entity" to mean such entity which is set up in accordance with the guidelines for the Pooled Finance Development Scheme notified by the Central Government. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 147. Sub-clause (259) of clause 314 of the Bill defines "Tax Recovery Officer" to mean any Income-tax Officer who may be authorised by the Chief Commissioner or the Commissioner, by general or special ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an a fund,— (a) which has been granted a certificate of registration as a venture capital fund under the Securities and Exchange Board of India Act, 1992; and (b) which fulfils all other conditions as may be prescribed in this behalf. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 153. Sub-clause (292) of clause 314 of the Bill defines "venture capital undertaking" to mean such domestic company whose shares are not listed in a recognised stock exchange in India and which is engaged in the business of— (a) nanotechnology; (b) information technology relating to hardware and software development; (c) seed research and development; (d) bio-technology; (e) research and development of new chemical entities in the pharmaceutical sector; (f) production of bio-fuels; (g) dairy or poultry; (h) building and operating composite hotel-cum-convention centre with seating capacity of more than three thousand; (i) development of infrastructure facility; or (j) any other business as may be prescribed. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urn or information may be furnished electronically; (h) the document, statement, receipt, certificate or report which, regardless of anything to the contrary contained in this Code, may not be furnished along with the return but shall be produced before the Assessing Officer on demand; (i) the computer resource or the electronic record to which a document, application, claim, return or information may be transmitted electronically; (j) the manner in which any document, application, claim, return or information required to be filed under this Code may be verified; (k) the authority, agency or organisation who may receive any application, claim, return or information on behalf of the Board or the Department; (l) the procedure to be followed in calculating interest payable by assessees or interest payable by Government to assessees under any provision of this Code, including the rounding off of the period for which such interest is to be calculated in cases where such period includes a fraction of a month, and specifying the circumstances in which and the extent to which petty amounts of interest payable by assessees may be ignored; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... proposed to empower the Board to prescribed forms in this regard for the purposes of this clause. 157. Paragraph 4 of the Sixth Schedule of the Bill provides that the amount of family pension received by the widow or children or nominated heirs, as the case may be, of a member of the armed forces (including para-military forces) of the Union, if the death of such member has occurred in the course of operational duties, in such circumstances and subject to such conditions, as may be prescribed. Accordingly, it is proposed to empower the Central Government to frame the scheme and make rules in this regard for the purposes of this clause. 158. Paragraph 5 of the Sixth Schedule of the Bill provides that income not included any income arising to a foreign company, as the Central Government may, by notification, specify in this behalf, by way of royalty or fees for technical services received in pursuance of an agreement entered into with the Government for providing services in or outside India in projects connected with security of India. Accordingly, it is proposed to empower the Central Government to issue notification in this regard for the purposes of this clause. 159. Pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come not included in the total income shall also comprise any amount of interest on bonds issued by a local authority or by a State Pooled Finance Entity as a public sector company and specified by the Central Government by notification. Accordingly, it is proposed to empower the Central Government to make rules and issue notification in this regard for the purposes of this clause. 164. Paragraph 34 of the Sixth Schedule of the Bill provides that income not included in the total income shall also comprise any income and amount thereof notified by the Central Government accruing to any person from any international sporting event held in India, if such event is approved by the international body regulating the international sport relating to such event; has participation of more than two countries; and is notified by the Central Government for the purposes of this paragraph. Accordingly, it is proposed to empower the Central Government to issue notification in this regard for the purposes of this clause. 165. Paragraph 41 of the Sixth Schedule of the Bill provides that income not included in the total income shall also comprise any payment received by any employee, from one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is proposed to empower the Central Government to frame the scheme in this regard for the purposes of this clause. 170. Paragraph 24 of the Seventh Schedule of the Bill provides that any corporation established by the Central or State Government for promoting the interests of the members of a minority community notified as such by the Central Government, shall not be liable to income-tax. Accordingly, it is proposed to empower the Central Government to issue notification in this regard for the purposes of this clause. 171. Paragraphs 3 and 4 of the Eighth Schedule of the Bill provides that the profits of the business of insurance other than life insurance shall be the profits disclosed in the annual accounts, copies of which are required to be furnished under the Insurance Act, 1938, to the Controller of Insurance. Such profits shall also be decreased by such amount carried over to a reserve for unexpired risks as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 166. Paragraph 11 of the Eighth Schedule of the Bill provides that the amount of common costs (including depreciatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the business transactions if the arrangement of transactions results in abuse of the tonnage income scheme. It is proposed to empower the Board to make rules in this regard for the purposes of this clause. 176. Paragraph 16 of the Tenth Schedule of the Bill further provides that the 'deemed tonnage' in a case where an arrangement has been entered into by the qualifying company for purchase of slots, slot charter or sharing of a qualifying ship, calculated in such manner as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 177. Paragraph 3 of the Eleventh Schedule of the Bill provides that for the purpose of computing the profits of the business of mineral oil or natural gas, the amount of business expenditure shall be the aggregate of the amounts specified therein, payment to Site Restoration Account maintained in State Bank of India in accordance with the Scheme as may be prescribed. Accordingly, it is proposed to empower the Central Government to frame the Scheme in this regard for the purposes of this clause. 178. Paragraph 6 of the Eleventh Schedule of the Bill provides ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny other condition as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 184. Item (ii) and (iii) of paragraph 9 of the Thirteenth Schedule of the Bill provides that the provisions of that Schedule shall apply to the specified business of laying and operating a cross country natural gas or crude or petroleum oil pipeline network for distribution, including storage facilities being an integral part of the network, which fulfils the condition that it has been approved by the Petroleum and Natural Gas Regulatory Board established under sub-clause (1) of clause 3 of the Petroleum and Natural Gas Regulatory Board Act, 2006 and notified by the Central Government in the Official Gazette in this behalf. Accordingly, it is proposed to empower the Central Government to issue notification in this regard for the purposes of this clause. 185. Paragraph 5 of the Fourteenth Schedule of the Bill provides that the amount of common costs (including depreciation) attributable to the business specified in column 2 of the Table in paragraph 1 and presumed to have been allowed under Paragraph 3 shall be d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd set up and notified by the Central Government. Accordingly, it is proposed to empower the Central Government to make rules and issue notifications in this regard for the purposes of this clause. 189. Part D of the Sixteenth Schedule of the Bill specifies the contributions or donations eligible for fifty per cent. deduction. This includes a temple, mosque, gurdwara, church or any other place as is notified by the Central Government to be of historic, archaeological or artistic importance or to be a place of public worship of renown throughout a State or States, to be utilised for the renovation or repair of such temple, mosque, gurdwara, church or other place. Accordingly, it is proposed to empower the Central Government to issue notification in this regard for the purposes of this clause. 190. Paragraph 3 of Part-I of the Nineteenth Schedule of the Bill provides that in order that a provident fund may receive and retain approval, it shall, subject to the provisions of Paragraph 5, satisfy the conditions set out thereunder and any other conditions which the Board may, by rules, specify. It further provides that the Board may by rules specify the conditions and restriction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pprove or an order withdrawing approval from a provident fund, may appeal, within sixty days of such order, to the Board. The Appeal shall be in such form and shall be verified in such manner and shall be subject to the payment of such fee as the Board may prescribe. Accordingly, it is proposed to empower the Board to make rules in this regard for the purposes of this clause. 195. Paragraph 15 of Part-I of the Nineteenth Schedule of the Bill provides that in addition to any power conferred by that Part, the Board may make rules— (a) prescribing the statements and other information to be submitted along with an application for approval; (b) limiting the contributions to an approved provident fund by employees of a company who are shareholders in the company; (c) regulating the investment or deposit or the moneys of an approved provident fund; (d) providing for the assessment by way of penalty of any consideration received by an employee for an assignment of, or creation of a charge upon, his beneficial interest in an approved provident fund; (e) determining the extend to and the manner in which exemption from payment of tax may be gra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her information to be submitted along with an application for approval; (b) prescribing the returns, statements, particulars, or information which the Assessing Officer may require from the trustees of an approved superannuation fund or from the employer; (c) limiting the ordinary annual contribution and any other contributions to an approved superannuation fund by an employer; (d) regulating the investment or deposit of the moneys of an approved superannuation fund; (e) providing for the assessment by way of penalty of any consideration received by an employee for any assignment of, or creation of a charge upon, his beneficial interest in an approved superannuation fund; (f) determining the extent to , and the manner in , which exemption from payment of tax may be granted in respect of any payment made from a superannuation fund from which approval has been withdrawn; (g) providing for the withdrawal for approval in the case of a fund which ceases to satisfy the requirements of this Part or of the rules made thereunder; and (h) generally, to carry out the purposes of this Part and to secure such further control ov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of an approved gratuity fund; (d) providing for the assessment by way of penalty of any consideration received by an employee for any assignment of, or creation of a charge upon, his beneficial interest in an approved gratuity fund; (e) providing for the withdrawal for approval in the case of a fund which ceases to satisfy the requirements of this part or of the rules made thereunder; (f) generally, to carry out the purposes of this Part and to secure such further control over the approval of gratuity funds and the administration of gratuity funds as it may deem requisite. Accordingly, it is proposed to empower the Board to make rules in this regard for the purposes of this clause. 203. Paragraph 7 of the Twentieth Schedule of the Bill provides that a resident assessee shall furnish the details of its investment and interest in any entity outside India in such form and manner as may be prescribed. Accordingly, it is proposed to empower the Central Government to make rules in this regard for the purposes of this clause. 204. Paragraph 22 of the Twentieth Schedule of the Bill provides that an order under the Tenth Schedule in relation to a quali ..... X X X X Extracts X X X X X X X X Extracts X X X X
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