9911796707
TMI BlogThe Finance Act, 1983 (No. 11 of 1983)X X X X Extracts X X X X X X X X Extracts X X X X ..... to which Paragraph E of that Part applies, by a surcharge, calculated in each case in the manner provided therein. (2) In the cases to which Sub-Paragraph I or Sub-Paragraph II of Paragraph A of Part I of the First Schedule applies, where the assessee has, in the previous year, any net agricultural income exceeding six hundred rupees, in addition to total income, and the total income exceeds,--- (i) in a case to which the said Sub-Paragraph I applies, fifteen thousand rupees, and (ii) in a case to which the said Sub-Paragraph II applies, twelve thousand rupees, then,--- (a) the net agricultural income shall be taken into account, in the manner provided in clause (b) (that is to say, as if the net agricultural income were comprised in the total income after,--- (i) in a case to which the said Sub-Paragraph I applies, the first fifteen thousand rupees, and (ii) in a case to which the said Sub-Paragraph II applies, the first eight thousand rupees, of the total income but without being liable to tax), only for the purpose of charging income-tax in respect of the total income ; and (b) the income-tax chargeable shall be calculated as follows :--- (i) the total incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eable shall be determined as provided in that Chapter or that section, and with reference to the rates imposed by sub-section (1) or the rates as specified in that Chapter or section, as the case may be. (4) In cases in which tax has to be deducted under sections 193, 194, 194A, 194B, 194BB, 194D and 195 of the Income-tax Act at the rates in force, the deduction shall be made at the rates specified in Part II of the First Schedule. (5) Subject to the provisions of sub-section (6), in cases in which income-tax has to be calculated under the first proviso to sub-section (5) of section 132 of the Income-tax Act or charged under sub-section (4) of section 172 or sub-section (2) of section 174 or section 175 or sub-section (2) of section 176 of the said Act or deducted under section 192 of the said Act from income chargeable under the head " Salaries " or deducted under sub-section (9) of section 80E of the said Act from any payment referred to in the said sub-section (9) or in which the " advance tax " payable under Chapter XVII-C of the said Act has to be computed, at the rate or rates in force, such income-tax or, as the case may be, " advance tax " shall be so calculated, charge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase to which the said Sub-Paragraph I applies, the first fifteen thousand rupees, and (ii) in a case to which the said Sub-Paragraph II applies, the first eight thousand rupees, of the total income but without being liable to tax), only for the purpose of calculating, charging or computing such income-tax or, as the case may be, " advance tax " in respect of the total income ; and (b) such income-tax or, as the case may be, " advance tax " shall be so calculated, charged or computed as follows :--- (i) the total income and the net agricultural income shall be aggregated and the amount of income-tax or " advance tax " shall be determined in respect of the aggregate income at the rates specified in Sub-Paragraph I or, as the case may be, Sub-Paragraph II of the said Paragraph A, as if such aggregate income were the total income : Provided that in a case referred to in the said Sub-Paragraph II, for the purposes of determining the amount of income-tax or " advance tax " in accordance with this sub-clause, the provisions of clause (ii) of the proviso below the said Sub-Paragraph II and the provisions relating to surcharge on income-tax in the said Sub-Paragraph II shall not a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcharge on income-tax payable by it, by one-half of the amount of surcharge payable by it ; and (ii) in a case where the amount of the deposit so made falls short of one-half of the amount of surcharge on income-tax payable by it, by the amount of the deposit. (8) For the purposes of this section and the First Schedule,--- (a) " company in which the public are substantially interested " means a company which is such a company as is referred to in section 108 of the Income-tax Act ; (b) " domestic company " means an Indian company, or any other company which, in respect of its income liable to income-tax under the Income-tax Act for the assessment year commencing on the 1st day of April, 1983, has made the prescribed arrangements for the declaration and payment within India of the dividends (including dividends on preference shares) payable out of such income in accordance with the provisions of section 194 of that Act ; (c) " industrial company " means a company which is mainly engaged in the business of generation or distribution of electricity or any other form of power or in the construction of ships or in the manufacture or processing of goods or in mining. Explanat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted unconditionally to, or acquired unconditionally by, and were throughout the relevant previous year beneficially held by--- (a) the Government, or (b) a corporation established by a Central, State or Provincial Act, or (c) any company to which this clause applies or any subsidiary company of such company where such subsidiary company fulfils the conditions laid down in clause (b) of section 108. Explanation.--- In its application to an Indian company whose business consists mainly in the construction of ships or in the manufacture or processing of goods or in mining or in the generation or distribution of electricity or any other form of power, item (B) shall have effect as if for the words " not less than fifty per cent.", the words " not less than forty per cent. " had been substituted ; '. 4. Amendment of section 9.--- In section 9 of the Income-tax Act, in sub-section (1),--- (a) in clause (i), in the Explanation, after clause (b), the following clause shall be inserted and shall be deemed always to have been inserted, namely :-- " (c) in the case of a non-resident, being a person engaged in the business of running a news agency or of publishing newspapers, mag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... going provisions of this clause, up to such maximum amount : Provided also that in relation to cases in which the event (that is to say, retirement of the employee or his becoming incapacitated or termination of his employment or his death, as the case may be) on which gratuity is received had taken place before the 31st day of January, 1982, the proviso immediately preceding this proviso shall not apply and the remaining provisions of this clause shall have effect as if for the words " thirty-six thousand rupees ", at the three places where they occur, the words " thirty thousand rupees " had been substituted.' ; (c) in clause (15),--- (i) in sub-clause (iib) [directed to be inserted by clause (d) of section 4 of the Finance Act, 1982 (14 of 1982)], for the words " interest on such Capital Investment Bonds ", the words " in the case of an individual or a Hindu undivided family, interest on such Capital Investment Bonds " shall be substituted ; (ii) in sub-clause (iv),--- (1) for item (a), the following item shall be substituted, namely :--- " (a) by Government or a local authority on moneys borrowed by it from, or debts owed by it to, sources outside India ; (2) in i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956), or a corporation established by or under a Central, State or Provincial Act) are held by the association after the 30th day of November, 1983 ; " ; (e) in clause (26A),--- (i) for the figures, letters and words " 1st day of April, 1983 ", the figures, letters and words " 1st day of April, 1986 " shall be substituted ; (ii) the Explanation shall be numbered and shall be deemed to have been numbered with effect from the 1st day of April, 1980, as Explanation 1 and after Explanation 1 as so numbered, the following Explanation shall be inserted and shall be deemed to have been inserted with effect from the 1st day of April, 1980, namely :--- " Explanation 2.--- In this clause, references to the district of Ladakh shall be construed as references to the areas comprised in the said district on the 30th day of June, 1979 ; ". 6. Amendment of section 11.--- In section 11 of the Income-tax Act,--- (a) in sub-section (2), for clause (b), the following clause shall be deposited substituted, namely :--- " (b) the money so accumulated or set apart is invested or in the forms or modes specified in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; (v) investment in any security for money created and issued by the Central Government or a State Government ; (vi) investment in debentures issued by, or on behalf of, any company or corporation both the principal whereof and the interest whereon are fully and unconditionally guaranteed by the Central Government or by a State Government ; (vii) investment or deposit in any Government company as defined in section 617 of the Companies Act, 1956 (1 of 1956) ; (viii) deposits with or investment in any bonds issued by a financial corporation which is engaged in providing long-term finance for industrial development in India and which is approved by the Central Government for the purposes of clause (viii) of sub-section (1) of section 36 ; (ix) deposits with or investment in any bonds issued by a public company formed and registered in India with the main object of carrying on the business of providing long-term finance for construction or purchase of houses in India for residential purposes and which is approved by the Central Government for the purposes of clause (viii) of sub-section (1) of section 36 ; (x) investment in immovoble property. Explanation.--- " Immovable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titution maintains separate books of account in respect of such business. " ; (b) in sub-section (2), in the opening portion, for the words, brackets and letter " provisions of clause (c) " the words, brackets and letters " provisions of clause (c) and clause (d) " shall be substituted ; (c) in sub-section (4), in the opening portion, for the words " in a case where ", the words, brackets and letter " but without prejudice to the provisions contained in clause (d) of that sub-section, in a case where " shall be substituted ; (d) sub-sections (5) and (6) shall be omitted. 8. Amendment of section 16.---In section 16 of the Income-tax Act, in clause (i), for the words " five thousand rupees ", the words " six thousand rupees " shall be substituted with effect from the 1st day of April, 1984. 9. Amendment of section 24.---In section 24 of the Income-tax Act, in sub-section (1), to clause (vi), the following Explanation shall be added with effect from the 1st day of April, 1984, namely :--- " Explanation.--- Where the property has been acquired or constructed with borrowed capital, the interest, if any, payable on such capital for the period prior to the previous year in whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) of clause (b) of sub-section (2), the provisions of sub-section (1) shall have effect in relation to such machinery or plant as if for the words " twenty-five per cent. ", the words " thirty-five per cent. " had been substituted.'. 12. Amendment of section 35.-- - In section 35 of the Income-tax Act, in sub-section (2A), after the words " pays any sum ", the brackets and words " (being any sum paid with a specific direction that the sum shall not be used for the acquisition of any land or building or construction of any building) " shall be inserted with effect from the 1st day of April, 1984. 13. Amendment of section 35B.---In section 35B of the Income-tax Act, in sub-section (1), in clause (a), after the words, figures and letters " after the 29th day of February, 1968 ", the words, figures and letters " but before the 1st day of March, 1983 " shall be inserted. 14. Amendment of section 35C.--- In section 35C of the Income-tax Act, in sub-section (1), with effect from the 1st day of April, 1984,--- (a) in clause (a), the words " a sum equal to one and one-fifth times " shall be omitted ; (b) in the Explanation, for the words " expenditure with reference to which deduc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n or institution before the 1st day of March, 1983. (2B) No certificate of the nature referred to in sub-section (2) or sub-section (2A) shall be issued by any association or institution unless such association or institution has obtained from the prescribed authority authorisation in writing to issue certificates of such nature. ". 17. Amendment of section 37.--- In section 37 of the Income-tax Act,--- (a) in sub-section (2A),--- (i) for clauses (iii) and (iv), the following shall be substituted with effect from the 1st day of, April, 1984, namely :--- " (iii) on the balance of the at the rate of 1/8 per cent., profits and gains of the business or profession (computed in the manner aforesaid) so, however, that the allowance shall in no case exceed Rs. 50,000 : " ; (ii) the Explanation shall be numbered and shall be deemed to have been numbered with effect from the 1st day of April, 1976, as Explanation 1 and after Explanation 1 as so numbered, the following Explanation shall be inserted and shall be deemed to have been inserted with effect from the 1st day of April, 1976, namely :--- ' Explanation 2.--- For the removal of doubts, it is hereby declared that for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny), who is resident in India in respect of expenditure incurred wholly and exclusively on--- (i) advertisement, publicity and sales promotion outside India in respect of the goods, services or facilities which the assessee deals in or provides in the course of his business ; (ii) running and maintenance of motor cars in any branch, office or agency maintained outside India for the promotion of the sale outside India of such goods, services or facilities. (3D) No disallowance under sub-section (3A) shall be made--- (i) in the case of an assessee engaged in the business of operation of aircraft, in respect of expenditure incurred on running and maintenance of such aircraft ; (ii) in the case of an assessee engaged in the business of running motor cars on hire, in respect of expenditure incurred in running and maintenance of such motor cars." ; (c) after sub-section (4), the following sub-section shall be inserted and shall be deemed to have been inserted with effect from the 1st day of April, 1979, namely :--- " (5) For the removal of doubts, it is hereby declared that any accommodation, by whatever name called, maintained, hired, reserved or otherwise arranged by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny with Government or with the Indian concern " ; (b) after clause (b) and before the Explanation, the following clause shall be inserted, namely :--- " (c) no deduction in respect of any expenditure or allowance shall be allowed under any of the said sections in computing income by way of interest received from Government or an Indian concern on moneys borrowed or debt incurred by the Government or the Indian concern in foreign currency. " ; (c) in the Explanation, in clause (d), for the portion beginning with the words " from an Indian concern " and ending with the words " with the Indian concern ", the following shall be substituted, namely :--- " from Government or an Indian concern in pursuance of an agreement made by a foreign company with Government or the Indian concern. ". 20. Amendment of section 54E.--- In section 54E of the Income-tax Act,--- (a) in sub-section (1),--- (i) after clause (b) and before Explanation 1, the following proviso shall be inserted, namely :--- " Provided that in a case where the original asset is transferred after the 28th day of February, 1983, the provisions of this sub-section shall not apply unless the assessee has invested or dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n thereto ; ". 21. Amendment of section 80C.--- In section 80C of the Income-tax Act, with effect from the 1st day of April, 1984,--- (a) in sub-section (2),--- (i) for clause (b) (occurring before the Explanation), the following clause shall be substituted, namely :--- " (b) where the assessee is a Hindu undivided family,--- (i) any sums paid in the previous year by the assessee out its income chargeable to tax--- (1) to effect or to keep in force an insurance on the life of any member of the family ; or (2) as a contribution to any provident fund referred to in sub-clause (iv) of clause (a), where such contribution is to an account standing in the name of any member of the family ; or (ii) any sums deposited in the previous year by the assessee out of its income chargeable to tax in a ten-year account or a fifteen-year account under the Post Office Savings Bank (Cumulative Time Deposits) Rules, 1959, as amended from time to time, where such sums are deposited in an account standing in the name of any member of the family. " ; (ii) in the Explanation below clause (b), for the word, brackets and letter " clause (b) ", the words, brackets, figure and letter " sub-c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relevant to an assessment year any goods or merchandise to which this section applies, there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the total income of the assessee, the following deductions, namely :--- (a) a deduction of an amount equal to one per cent. of the export turnover of such goods or merchandise during the previous year ; and (b) a deduction of an amount equal to five per cent. of the amount by which the export turnover of such goods or merchandise during the previous year exceeds the export turnover of such goods or merchandise during the immediately preceding previous year. (2) (a) This section applies to all goods or merchandise [other than those specified in clause (b)] if the sale proceeds of such goods or merchandise exported out of India are receivable by the assessee in convertible foreign exchange. (b) The goods or merchandise referred to in clause (a) are the following, namely :--- (i) agricultural primary commodities, not being produce of plantations ; (ii) mineral oil ; (iii) minerals and ores ; and (iv) such other goods or merchandise as the Central Government may, by notification in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... airs to ocean-going vessels or other powered craft " shall be inserted ; (ii) after the proviso, the following proviso shall be inserted, namely :--- ' Provided further that in the case of art assessee carrying on the business of repairs to ocean-going vessels or other powered craft, the provisions of this sub-section shall have effect as if for the words " seven assessment years ", the words " four assessment years " had been substituted.' ; (d) in sub-section (6), after the word " hotel ", at both the places where it occurs, the words " or the business of repairs to ocean-going vessels or other powered craft " shall be inserted ; (e) in sub-section (8), after the words " operation of the ship ", wherever they occur, the words " or the business of repairs to ocean-going vessels or other powered craft " shall be inserted ; (f) in sub-section (9), after the word " ship ", wherever, it occurs, the words " or the business of repairs to ocean-going vessels or other powered craft " shall be inserted. 26. Amendment of section 80JJ.--- In section 80JJ of the Income-tax Act with effect from the 1st day of April, 1984,--- (a) in clause (b), for the word " one-fifth ", the word ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess ; ". 31. Amendment of section 80R.--- In section 80R of the Income-tax Act, for the words " such other association or body established outside India as may be notified in this behalf by the Central Government in the Official Gazette ", the words " any other association or body established outside India " shall be substituted with effect from the 1st day of April, 1984. 32. Insertion of new Chapter VI-B.--- In the Income-tax Act, after Chapter VI-A, the following Chapter shall be inserted with effect from the 1st day of April, 1984, namely :--- " CHAPTER VI-B RESTRICTION ON CERTAIN DEDUCTIONS IN THE CASE OF COMPANIES 80VVA. Restriction on certain deduction in the case of companies.-- - (1) Notwithstanding anything contained in any other provision of this Act, where in the case of an assessee being a company, the amount or, as the case may be, the aggregate amount which, but for the provisions of this section, would have been admissible as deduction for any assessment year under any one or more of the provisions of this Act specified in sub-section (2) exceeds seventy per cent. of the amount of total income as computed had no deduction been allowed under any of the said p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e pre-incentive total income, deduction shall next be allowed under the provision specified in clause (ii) of sub-section (2) ; and (c) if no deduction is allowable under the provision specified in the said clause (ii), or the deduction under that provision together with the deduction allowed under the provision referred to in the said clause (i), is less than seventy per cent. of the pre-incentive total income, deduction shall next be allowed under the provision specified in clause (iii) of sub-section (2) and so on until the aggregate deduction so allowed is equal to seventy per cent. of the pre-incentive total income. (4) To the extent to which full deduction cannot be allowed in the assessment year in respect of any provision specified in sub-section (2), by virtue only of the restriction under sub-section (1) (and not by virtue of anything contained in any other section), the amount remaining unallowed shall be added to the amount, if any, to be allowed to the assessee under the said provision for the next following assessment year and be deemed to be part of the deduction admissible to the assessee under the said provision for that year or, if no such deduction is admissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, after clause (b), the following clause shall be inserted, namely :--- '(bb) " foreign currency " shall have the same meaning as in the Explanation below item (g) of sub-clause (iv) of clause (15) of section 10 ;'. 36. Insertion of new Chapter XII-A.--- In the Income-tax Act, after Chapter XII, the following Chapter shall he inserted with effect from the 1st day of June, 1983, namely :--- 'CHAPTER XII-A SPECIAL PROVISIONS RELATING TO CERTAIN INCOMES OF NON-RESIDENTS 115C. Definitions.--- In this Chapter, unless the context otherwise requires,--- (a) " convertible foreign exchange " means foreign exchange which is for the time being treated by the Reserve Bank of India as convertible foreign exchange for the purposes of the Foreign Exchange Regulation Act, 1973 (46 of 1973), and any rules made thereunder ; (b) " foreign exchange asset " means any specified asset which the assessee has acquired, or purchased with, or subscribed to, in convertible foreign exchange ; (c) " investment income " means any income derived from a foreign exchange asset ; (d) " long-term capital gains " means income chargeable under the head " Capital gains " relating to a capital asset, bei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax payable by him on his total income shall be--- (i) the aggregate of the income-tax and surcharge payable by him in accordance with the provisions of sub-section (1) on income of the nature referred to in that sub-section included in the total income ; plus (ii) the amount of income-tax chargeable on the total income as reduced by the amount of income of the nature referred to in sub-section (1), had the total income so reduced been his total income. 115F. Capital gains on transfer of foreign exchange assets not to be charged in certain cases.--- (1) Where, in the case of an assessee being a non-resident Indian, any long-term capital gains arise from the transfer of a foreign exchange asset (the asset so transferred being hereafter in this section referred to as the original asset), and the assessee has, within a period of six months after the date of such transfer, invested or deposited the whole or any part of the net consideration in any specified asset or in an Account referred to in clause (4A), or in any savings certificates referred to in clause (4B), of section 10 (such specified asset or such deposit in the Account aforesaid or such savings certificates being herea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be available in certain cases even after the assessee becomes resident.--- Where a person, who is a non-resident Indian in any previous year, becomes assessable as resident in India in respect of the total income of any subsequent year, he may furnish to the Income-tax Officer a declaration in writing along with his return of income under section 139 for the assessment year for which he is so assessable, to the effect that the provisions of this Chapter shall continue to apply to him in relation to the investment income derived from any foreign exchange asset being an asset of the nature referred to in sub-clause (ii) or sub-clause (iii) or sub-clause (iv) or sub-clause (v) of clause (f) of section 115C ; and if he does so, the provisions of this Chapter shall continue to apply to him in relation to such income for that assessment year and for every subsequent assessment year until the transfer or conversion (otherwise than by transfer) into money of such assets. 115-I. Chapter not to apply if the assesses so chooses.---A non-resident Indian may elect not to be governed by the provisions of this Chapter for any assessment year by furnishing to the Income-tax Officer his return ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y be, constructed in the said area, is transferred by the company within a period of five years from the date of purchase, acquisition or, as the case may be, the date of completion of construction ". 39. Consequential amendments to certain sections.--- The following amendments (being amendments of a consequential nature) shall be made in the Income-tax Act, namely :--- (a) in sub-section (3) of section 11, for clause (b), the following clause shall be substituted, namely :--- " (b) ceases to remain invested or deposited in any of the forms or modes specified in sub-section (5), or " ; (b) in sub-section (3) of section 80A--- (i) after the words, figures and letters " or section 80HHB ", the words, figures and letters " or section 80HHC " shall be inserted ; (ii) the words, figures and letters of section " 80JJA " shall be omitted with effect from the 1st day of April 1984 ; (c) in sub-section (5) of section 80G, to clause (i), the following proviso shall be added with effect from the 1st day of April, 1984, namely :--- " Provided that where an institution or fund derives any income, being profits and gains of business, the condition that such income would not be li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ging to the company on the valuation date is in excess of the aggregate value of all the debts owed by the company on the valuation date which are secured on, or which have been incurred in relation to, the said assets : Provided that where any debt secured on any assets belonging to the assessee is incurred for, or ensure to, the benefit of any other person, or is not represented by any asset belonging to the assessee, the value of such debt shall not be taken into account in computing the net wealth of the assessee. (3) The assets referred to in sub-section (2) shall be the following, namely :--- (i) gold, silver, platinum or any other precious metal or any alloy containing one or more of such precious metals ; (ii) precious or semi-precious stones whether or not set in any furniture, utensil or other article or worked or sewn into any wearing apparel ; (iii) ornaments made of gold, silver, platinum or any other precious metal or any alloy containing one or more of such precious metals, whether or not containing any precious or semi-precious stone, and whether or not worked or sewn into any wearing apparel ; (iv) utensils made of gold, silver, platinum or any other pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng clause shall be substituted with effect from the 1st day of April, 1984, namely :--- " (xa) in the case of an assessee who is carrying on a profession (being legal, medical, engineering or architectural profession or the profession of accountancy or such other profession as is notified by the Central Government in this behalf) and who regularly maintains books of account on the cash system of accounting, the amount of any fee due to him in respect of the services rendered by him in such professional capacity ; " ; (b) for clause (xvic) [directed to be inserted by sub-clause (v) of clause (a) of section 34 of the Finance Act, 1982 (14 of 1982)], the following clauses shall be substituted with effect from the 1st day of April, 1984, namely :--- ' (xvic) in the case of an individual, being a citizen of India or a person of Indian origin who is not resident in India, during the year ending on the valuation date, any foreign exchange asset. Explanation.--- For the purposes of this clause,--- (a) a person shall be deemed to be of Indian origin if he or either of his parents or any of his grand-parents was born in undivided India ; (b) an individual shall be deemed to be no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use (a) of section 38 of the Finance Act, 1982 (14 of 1982)], for the portion beginning with the words " savings certificates " and ending with the words " rules made thereunder ", the following shall be substituted with effect from the 1st day of April, 1984, namely :--- " any foreign exchange asset as defined in clause (b) of section 115C of the Income-tax Act ; " ; (b) in clause (iiic) [directed to be inserted by clause (b) of section 38 of the Finance Act, 1982 (14 of 1982)], for the words " of property in the form of such Capital Investment Bonds ", the words " being an individual or a Hindu undivided family, of property in the form of such Capital Investment Bonds " shall be substituted. Interest Tax 43. Amendment of section 4.--- In section 4 of the Interest-tax Act, 1974 (45 of 1974), the following proviso shall be inserted at the end, namely :--- "Provided that the rate at which interest-tax shall be changed in respect of any chargeable interest accruing or arising after the 31st day of March, 1983, shall be three and a half per cent. of such chargeable interest.". THE FIRST SCHEDULE (See section 2) PART I INCOME-TAX AND SURCHARGE ON INCOME-TAX Paragraph A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 8,000 (2) where the total income 22 per cent. of the amount by exceeds Rs. 8,000 but does not which the total income exceeds exceed Rs. 15,000 Rs. 8,000; (3) where the total income Rs. 1,540 plus 27 per cent. of the exceeds Rs. 15,000 but does not amount by which the total exceed Rs. 20,000 income exceeds Rs. 15,000; (4) where the total income Rs. 2,890 plus 35 per cent. of the exceeds Rs. 20,000 but does not amount by which the total exceed Rs. 25,000 income exceeds Rs. 20,000; (5) where the total income Rs. 4,640 plus 40 per cent. of the exceeds Rs. 25,000 but does not amount by which the total exceed Rs. 30,000 income exceeds Rs. 25,000; (6) where the total income Rs. 6,640 plus 50 per cent. of the exceeds Rs. 30,000 but does not amount by which the total exceed Rs. 50,000 income exceeds Rs. 30,000; (7) where the total income Rs. 16,640 plus 60 per cent. of the exceeds Rs. 50,000 amount by which the total income exceeds Rs. 50,000: Provided that for the purposes of this Sub-Paragraph,--- (i) no income-tax shall be payable on a total income not exceeding Rs. 12,000; (ii) where the total income exceeds Rs. 12,000 but does not exceed Rs. 17,610, the income- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al income,---- Rates of income-tax (1) where the total income Nil; does not exceed Rs. 10,000 (2) where the total income 4 per cent. of the amount by exceeds Rs. 10,000 but does not which the total income exceeds exceed Rs. 25,000 Rs. 10,000; (3) where the total income Rs. 600 plus 7 per cent. of the exceeds Rs. 25,000 but does not amount by which the total exceed Rs. 50,000 income exceeds Rs. 25,000; (4) where the total income Rs. 2,350 plus 13 per cent. of the exceeds Rs. 50,000 but does not amount by which the total exceed Rs. 1,00,000 income exceeds Rs. 50,000; (5) where the total income Rs. 8,850 plus 22 per cent. of the exceeds Rs. 1,00,000 amount by which the total income exceeds Rs. 1,00,000. Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall be increased by a surcharge for purposes of the Union calculated at the rate of ten per cent. of such income-tax. Explanation.---For the purposes of this Paragraph, " registered firm " includes an unregistered firm assessed as a registered firm under clause (b) of section 183 of the Income-tax Act. Paragraph D In the case of every ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsists of--- (a) royalties received from an Indian concern in pursuance of an agreement made by it with the Indian concern after the 31st day of March, 1961, but before the 1st day of April, 1976, or (b) fees for rendering technical services received from an Indian concern in pursuance of an agreement made by it with the Indian concern after the 29th day of February, 1964, but before the 1st day of April, 1976, and where such agreement has, 50 per cent.; in either case, been approved by the Central Government (ii) on the balance, if any, of 70 per cent. the total income Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Paragraph shall be increased by a surcharge calculated at the rate of two and a half per cent. of such income-tax. PART II Rates for deduction of tax at source in certain cases In every case in which under the provisions of sections 193, 194, 194A, 194B, 194BB, 194D and 195 of the Income-tax Act, tax is to be deducted at the rates in force, deduction shall be made from the income subject to deduction at the following rates : ----------------------------------------------------- I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on a tax-free security. 2. In the case of a company--- (a) where the company is a domestic company--- (i) on income by way of 20 per cent. 1 per cent.; interest other than " Interest on securities " (ii) on any other income 21.5 per cent. 1.075 per cent.; (excluding interest payable on a tax-free security) (b) where the company is not a domestic company--- (i) on income by way of 25 per cent. Nil; dividends payable by any domestic company (ii) on income by way of 25 per cent. Nil; interest payable by Government or an Indian concern on moneys borrowed or debt incurred by Government or the Indian concern in foreign currency (iii) on income by way of 40 per cent. Nil; royalty payable by Government or an Indian concern in pursuance of an agreement made by it with the Government or the Indian concern after the 31st day of March, 1976, where such royalty is in consideration for the transfer of all or any rights (including the granting a licence) in respect of copyright in any book on a subject referred to in the proviso to sub-section (1A) of section 115A of the Income-tax Act, to the Indian concern. (iv) on income by way of royalty [not be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies " or deducted under sub-section (9) of section 80E of the said Act from any payment referred to in the said sub-section (9) or in which the " advance tax " payable under Chapter XVII-C of the said Act has to be computed, at the rate or rates in force, such income-tax or as the case may be, " advance tax " (not being " advance tax " in respect of any income chargeable to tax under Chapter XII or Chapter XII--A or section 164 or section 164A or section 167A of the Income-tax Act at the rates as specified in that Chapter or section), shall be so calculated, charged, deducted or computed at the following rate or rates :--- Paragraph A Sub-Paragraph I In the case of every individual or Hindu undivided family or unregistered firm or other association of persons or body of individuals, whether incorporated or not, or every artificial juridical person referred to in sub-clause (vii) of clause (31) of section 2 of the Income-tax Act, not being a case to which Sub-Paragraph II of this Paragraph or any other Paragraph of this Part applies,--- Rates of income-tax (1) where the total income Nil; does not exceed Rs. 15,000 (2) where the total income 25 per cent. of the amount by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s 35 per cent. of the exceeds Rs. 20,000 but does not amount by which the total exceed Rs. 25,000 income exceeds Rs. 20,000; (5) where the total income Rs. 4,640 plus 40 per cent. of the exceeds Rs. 25,000 but does not amount by which the total exceed Rs. 30,000 income exceeds Rs. 25,000; (6) where the total income Rs. 6,640 plus 50 per cent of the exceeds Rs. 30,000 but does not amount by which the total exceed Rs. 50,000 income exceeds Rs. 30,000; (7) where the total income Rs. 16,640 plus 60 per cent. of the exceeds Rs. 50,000 amount by which the total income exceeds Rs. 50,000 : Provided that for the purposes of this Sub-Paragraph,--- (i) no income-tax shall be payable on a total income not exceeding Rs. 12,000; (ii) where the total income exceeds Rs. 12,000 but does not exceed Rs. 17,610 the income-tax payable thereon shall not exceed forty per cent. of the amount by which the total income exceeds Rs. 12,000. Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall be increased by a surcharge for purposes of the Union calculated at the rate of twelve and a half per cent. of such incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5,000 but does not amount by which the total exceed Rs. 50,000 income exceeds Rs. 25,000; (4) where the total income Rs. 2,350 plus 13 per cent. of the exceeds Rs. 50,000 but does not amount by which the total exceed Rs. 1,00,000 income exceeds Rs. 50,000; (5) where the total income Rs. 8,850 plus 22 per cent. of the exceeds Rs. 1,00,000 amount by which the total income exceeds Rs. 1,00,000. Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall be increased by a surcharge for purposes of the Union calculated at the rate of twelve and a half per cent. of such income-tax. Explanation.---For the purposes of this Paragraph, " registered firm " includes an unregistered firm assessed as a registered firm under clause (b) of section 183 of the Income-tax Act. Paragraph D In the case of every local authority, --- Rate of income-tax On the whole of the total income 50 per cent. Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Paragraph shall be increased by a surcharge for purposes of the Union calculated at the rate of twelve and a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d before making any deduction under Chapter VI-A of the Income-tax Act) is not less than fifty-one per cent. of such total income; (ii) " project " means a project for the construction of a building, road, dam, bridge or other structure or assembly or installation of any machinery or plant. PART IV [See section 2(7)(e)] RULES FOR COMPUTATION OF NET AGRICULTURAL INCOME Rule 1.--- Agricultural income of the nature referred to in sub-clause (a) of clause (1) of section 2 of the Income-tax Act shall be computed as if it were income chargeable to income-tax under that Act under the head " Income from other sources " and the provisions of sections 57 to 59 of that Act shall, so far as may be apply accordingly. Provided that sub-section (2) of section 58 shall apply subject to the modification that the reference to section 40A therein shall be construed as not including a reference to sub-sections (3) and (4) of section 40A. Rule 2.--- Agricultural income of the nature referred to in sub-clause (b) or sub-clause (c) of clause (1) of section 2 of the Income-tax Act [other than income derived from any building required as a dwelling house by the receiver of the rent or revenue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e or loss of the firm shall be computed in the manner laid down in sub-section (1), sub-section (2), and sub-section (3) of section 67 of the Income-tax Act and the share so computed shall be regarded as the agricultural income or loss of the assessee. Rule 6.--- Where the assessee is a member of an association of persons or a body of individuals (other than a Hindu undivided family, a company or a firm) which in the previous year has either no income chargeable to tax under the Income-tax Act or has total income not exceeding the maximum amount not chargeable to tax in the case of an association of persons or a body of individuals (other than a Hindu undivided family, a company or a firm) but has any agricultural income, then, the agricultural income or loss of the association or body shall be computed in accordance with these rules and the share of the assessee in the agricultural income or loss so computed shall be regarded as the agricultural income or loss of the assessee. Rule 7.--- Where the result of the computation for the previous year in respect of any source of agricultural income is a loss, such loss shall be set off against the income of the assessee, if any, for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessment year commencing on the 1st day of April, 1977, to the extent, if any, such loss has not been set off against the agricultural income for the previous year relevant to the assessment year commencing on the 1st day of April, 1978, or the 1st day of April, 1979, or the 1st day of April, 1980, or the 1st day of April, 1981, or the 1st day of April, 1982, (iv) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April, 1978, to the extent, if any, such loss has not been set off against the agricultural income for the previous year relevant to the assessment year commencing on the 1st day of April, 1979, or the 1st day of April, 1980, or the 1st day of April, 1981, or the 1st day of April, 1982, (v) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April, 1979, to the extent, if any, such loss has not been set off against the agricultural income for the previous year relevant to the assessment year commencing on the 1st day of April, 1980, or the 1st day of April, 1981, or the 1st day of April, 1982, (vi) the loss so computed for the previous year relevant to the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evious year relevant to the assessment year commencing on the 1st day of April, 1978, or the 1st day of April, 1979, or the 1st day of April, 1980, or the 1st day of April, 1981, or the 1st day of April, 1982, or the 1st day of April, 1983, (iii) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April, 1978, to the extent, if any, such loss has not been set off against the agricultural income for the previous year relevant to the assessment year commencing on the 1st day of April, 1979, or the 1st day of April, 1980, or the 1st day of April, 1981, or the 1st day of April, 1982, or the 1st day of April, 1983, (iv) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April, 1979, to the extent, if any, such loss has not been set off against the agricultural income for the previous year relevant to the assessment year commencing on the 1st day of April, 1980, or the 1st day of April, 1981, or the 1st day of April, 1982, or the 1st day of April, 1983, (v) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April, 1980, to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6 of 1976), or of the First Schedule to the Finance (No. 2) Act, 1977 (29 of 1977), or of the Schedule to the Finance Act, 1978 (19 of 1978), or of the First Schedule to the Finance Act, 1979 (21 of 1979), or of the First Schedule to the Finance (No. 2) Act, 1980 (44 of 1980), or of the First Schedule to the Finance Act, 1981 (16 of 1981), or of the First Schedule to the Finance Act, 1982 (14 of 1982), shall be set off under sub-rule (1) or, as the case may be, sub-rule (2). Rule 10.--- Where the net result of the computation made in accordance with these rules is a loss, the loss so computed shall be ignored and the net agricultural income shall be deemed to be nil. Rule 11.--- The provisions of the Income-tax Act, relating to procedure for assessment (including the provisions of section 288A relating to rounding off of income) shall, with the necessary modifications, apply in relation to the computation of the net agricultural income of the assessee as they apply in relation to the assessment of the total income. Rule 12.--- For the purposes of computing the net agricultural income of the assessee, the Income-tax Officer shall have the same powers as he has under Income-tax ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
