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Highlights of the Undisclosed Foreign Income and Assets (Imposition of Tax) Bill, 2015 Introduced in Lok Sabha Today.

Dated:- 20-3-2015 - The Finance Minister, in his budget speech, while acknowledging the limitations under the existing law, had conveyed the considered decision of the Government to enact a comprehensive new law on black money to specifically deal with black money stashed away abroad. He also promised to introduce the new Bill in the current Session of the Parliament. In order to fulfil the commitment made by the Government to the people of India through the Parliament, the Undisclosed Foreign I .....

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ident in India. Provisions of the Act will apply to both undisclosed foreign income and assets (including financial interest in any entity). Rate of tax - Undisclosed foreign income or assets shall be taxed at the flat rate of 30 percent. No exemption or deduction or set off of any carried forward losses which may be admissible under the existing Income-tax Act, 1961, shall be allowed. Penalties - Violation of the provisions of the proposed new legislation will entail stringent penalties. The pe .....

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the foreign income and asset or has furnished inaccurate particulars of the same. Prosecutions - The Bill proposes enhanced punishment for various types of violations. The punishment for willful attempt to evade tax in relation to a foreign income or an asset located outside India will be rigorous imprisonment from three years to ten years. In addition, it will also entail a fine. Failure to furnish a return in respect of foreign assets and bank accounts or income will be punishable with rigoro .....

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punishable with rigorous imprisonment from six months to seven years. This provision will also apply to banks and financial institutions aiding in concealment of foreign income or assets of resident Indians or falsification of documents. Safeguards - The principles of natural justice and due process of law have been embedded in the Act by laying down the requirement of mandatory issue of notices to the person against whom proceedings are being initiated, grant of opportunity of being heard, nece .....

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orance, it has been provided that failure to report bank accounts with a maximum balance of upto ₹ 5 lakh at any time during the year will not entail penalty or prosecution. Other safeguards and internal control mechanisms will be prescribed in the Rules. One time compliance opportunity - The Bill also provides a one time compliance opportunity for a limited period to persons who have any undisclosed foreign assets which have hitherto not been disclosed for the purposes of Income-tax. Such .....

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force. Amendment of PMLA - The Bill also proposes to amend Prevention of Money Laundering Act (PMLA), 2002 to include offence of tax evasion under the proposed legislation as a scheduled offence under PMLA. Thus, in keeping with the commitment of the government for focussed action on black money front, an unprecedented and multi-pronged attack has been launched to root out the menace of black money. The Government is confident that this new law will act as a strong deterrent and curb the menace .....

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he Republic of India as follows:- CHAPTER I PRELIMINARY Short title, extent and commencement. 1. (1) This Act may be called the Undisclosed Foreign Income and Assets (Imposition of Tax) Act, 2015. (2) It extends to the whole of India. (3) Save as otherwise provided in this Act, it shall come into force on the 1st day of April, 2016. Definitions. 2. In this Act, unless the context otherwise requires,- (1) assessee means a person, being a resident other than not ordinarily resident in India within .....

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very year; (5) Board means the Central Board of Direct Taxes constituted under the Central Boards of Revenue Act, 1963; (54 of 1963.) (6) Income-tax Act means the Income-tax Act, 1961; (43 of 1961.) (7) participant means- (a) a partner in relation to a firm; or (b) a member in relation to an association of persons or body of individuals; (8) prescribed means prescribed by rules made under this Act; (9) previous year means- (a) the period beginning with the date of setting up of a business and en .....

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inuance of the business other than business referred to in clause (b) or dissolution of an unincorporated body or liquidation of a company, as the case may be; or (d) the period of twelve months commencing on the 1st day of April of the relevant year in any other case, and which immediately precedes the assessment year. (10) resident means a person who is resident in India within the meaning of section 6 of the Income-tax Act; (11) undisclosed asset located outside India means an asset (includin .....

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, referred to in section 4, and computed in the manner laid down in section 5; (13) unincorporated body means- (a) a firm; (b) an association of persons; or (c) a body of individuals; (14) value of an undisclosed asset shall have the meaning assigned to it in sub-section (2) of section 3; (15) all other words and expressions used herein but not defined and defined in the Income-tax Act shall have the meanings respectively assigned to them in that Act. CHAPTER II BASIS OF CHARGE Charge of tax. 3. .....

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(2) For the purposes of this section value of an undisclosed asset means the fair market value of an asset (including financial interest in any entity) determined in such manner as may be prescribed. Scope of total undisclosed foreign income and asset. 4. (1) Subject to the provisions of this Act, the total undisclosed foreign income and asset of any previous year of an assessee shall be,- (a) the income from a source located outside India, which has not been disclosed in the return of income f .....

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e of an undisclosed asset located outside India. (2) Notwithstanding anything contained in sub-section (1), any variation made in the income from a source outside India in the assessment or reassessment of the total income of any previous year, of the assessee under the Income-tax Act in accordance with the provisions of section 29 to section 43C or section 57 to section 59 or section 92C of the said Act shall not be included in the total undisclosed foreign income. (3) The income included in th .....

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any income,- (a) which has been assessed to tax for any assessment year under the Income-tax Act prior to the assessment year to which this Act applies; or (b) which is assessable or has been assessed to tax for any assessment year under this Act, shall be reduced from the value of the undisclosed asset located outside India, if, the assessee furnishes evidence to the satisfaction of the Assessing Officer that the asset has been acquired from the income which has been assessed or is assessable, .....

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9-10 for fifty lakh rupees. Out of the investment of fifty lakh rupees, twenty lakh rupees was assessed to tax in the total income of the previous year 2009-10 and earlier years. Such undisclosed asset comes to the notice of the Assessing Officer in the year 2017-18. If the value of the asset in the year 2017-18 is one crore rupees, the amount chargeable to tax shall be A-B=C where, A=Rs.1 crore, B=Rs. (100 x 20/50) lakh= ₹ 40 lakh, C=Rs. (100-40) lakh=Rs.60 lakh. CHAPTER III TAX MANAGEMEN .....

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ections issued under section 120 of that Act (including orders or directions assigning the concurrent jurisdiction) or under any other provision of that Act. (4) The tax authority having jurisdiction in relation to an assessee who has no income assessable to income-tax under the Income-tax Act shall be the tax authority having jurisdiction in respect of the area in which the assessee resides or carries on its business or has its principal place of business. (5) Section 118 of the Income-tax Act .....

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tage at which it was left by his predecessor. (2) The assessee in such a case may be given an opportunity of being heard, if he so requests in writing , before passing any order in his case. Powers regarding discovery and production of evidence. 8. (1) The prescribed tax authorities shall, for the purposes of this Act, have the same powers as are vested in a court under the Code of Civil Procedure, 1908, while trying a suit in respect of the following matters, namely:-(5 of 1908.) (a) discovery .....

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on (1) or sub-section (2) may, subject to the rules made in this behalf, impound any books of account or other documents produced before it and retain them in its custody for such period as it thinks fit. (4) Any tax authority below the rank of Commissioner shall not- (a) impound any books of account or other documents without recording his reasons for doing so; or (b) retain in his custody any such books or documents for a period exceeding thirty days without obtaining the approval of the Princ .....

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he purposes of Chapter XXVI of the Code of Criminal Procedure, 1973. (2 of 1974.) Assessment. 10. (1) For the purposes of making an assessment or reassessment under this Act, the Assessing Officer may, on receipt of an information from an income-tax authority under the Income-tax Act or any other authority under any law for the time being in force or on coming of any information to his notice, serve on any person, a notice requiring him on a date to be specified to produce or cause to be produce .....

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cer, after considering such accounts, documents or evidence, as he has obtained under sub-section (1), and after taking into account any relevant material which he has gathered, under sub-section (2) and any other evidence produced by the assessee, shall by an order in writing, assess the undisclosed foreign income and asset and determine the sum payable by the assessee. (4) If any person fails to comply with the terms of the notice under sub-section (1), the Assessing Officer shall, after takin .....

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of section 10 was issued by the Assessing Officer. (2) Notwithstanding anything contained in sub-section (1), an order of fresh assessment in pursuance of an order passed under section 18 setting aside or cancelling an assessment, may be made at any time before the expiry of the period of two years from the end of the financial year in which the order under section 18 is received by the Principal Commissioner or the Commissioner. (3) The provisions of sub-section (1) shall not apply to the asse .....

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ceived by the Principal Commissioner or the Commissioner. Explanation 1.- In computing the period of limitation for the purpose of this section- (i) the time taken in reopening the whole or any part of the proceeding; or (ii) the period during which the assessment proceeding is stayed by an order or injunction of any court; or (iii) the period commencing from the date on which a reference or first of the references for exchange of information is made by an authority competent under an agreement .....

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sment or reassessment, as the case may be, is less than sixty days, such remaining period shall be extended to sixty days and the aforesaid period of limitation shall be deemed to be extended accordingly. Explanation 2.-Where, by an order referred to in sub-section (3), any undisclosed foreign income and asset is excluded from the total undisclosed foreign income and asset for an assessment year in respect of an assessee, then, an assessment of such undisclosed foreign income and asset for anoth .....

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d was passed. (3) The tax authority shall not make any amendment, which has the effect of enhancing the undisclosed foreign income and asset or reducing a refund or otherwise increasing the liability of the assessee, unless the authority concerned has given to the assessee an opportunity of being heard. (4) The tax authority concerned may make an amendment under this section- (a) on its own motion; or (b) on the application made to it by the assessee or, as the case may be, by the Assessing Offi .....

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d by a tax authority by serving upon the assessee a notice of demand in such form and manner as may be prescribed. Direct assessment or recovery not barred. 14. Nothing in this Chapter shall prevent either the direct assessment of the person on whose behalf or for whose benefit the undisclosed income from a source located outside India is receivable or undisclosed asset located outside India is held, or the recovery from such person of the tax or any other sum of money payable in respect of such .....

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laim made by the assessee for a rectification under section 12, may appeal to the Commissioner (Appeals). (2) Every appeal shall be filed in such form and verified in such manner and be accompanied by a fee as may be prescribed. (3) An appeal shall be presented within a period of thirty days from- (a) the date of service of the notice of demand relating to the assessment or penalty, or (b) the date on which the intimation of the order sought to be appealed against is served in any other case. (4 .....

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sessment or penalty: Provided that an order enhancing the assessment or penalty shall not be made unless the assessee has been given a reasonable opportunity of being heard. Procedure to be followed in appeal. 16. (1) The Commissioner (Appeals) shall fix a date and place for the hearing of the appeal, and shall give notice of the same to the appellant and the Assessing Officer against whose order the appeal is preferred. (2) The following shall have the right to be heard at the hearing of the ap .....

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e an inquiry and report to him on the points arising out of any question of law or fact. (6) The Commissioner (Appeals) may, at the hearing of an appeal, allow the appellant to go into any ground of appeal not specified in the grounds of appeal, if the Commissioner (Appeals) is satisfied that the omission was not wilful or unreasonable. (7) The order of the Commissioner (Appeals) disposing of the appeal shall be in writing and shall state the points for determination, the decision thereon and th .....

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incipal Commissioner or the Commissioner. Powers of Commissioner (Appeals). 17. (1) In disposing of an appeal, the Commissioner (Appeals) shall have the following powers, namely:- (a) in an appeal against an order of assessment, he may confirm, reduce, enhance or annul the assessment; (b) in an appeal against an order imposing a penalty, he may confirm or cancel such order; (c) in any other case, he may determine the issues arising in the appeal and pass such orders thereon, as he thinks fit. (2 .....

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Appeals to Appellate Tribunal. 18. (1) Any assessee aggrieved by an order passed by the Commissioner (Appeals) under section 15, or an order passed by the Principal Commissioner or the Commissioner under any provision of this Act, may appeal to the Appellate Tribunal against such order. (2) The Principal Commissioner or the Commissioner may, if he objects to any order passed by the Commissioner (Appeals) under any provision of this Act, direct the Assessing Officer to appeal to the Appellate Tri .....

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(2) by the other party may, notwithstanding that he may not have appealed against such order or any part thereof, within thirty days of the receipt of the notice, file a memorandum of cross-objections, verified in the prescribed manner, against any part of the order of the Commissioner (Appeals), and such memorandum shall be disposed of by the Appellate Tribunal as if it were an appeal presented within the time specified in sub-section (3). (5) The Appellate Tribunal may admit an appeal or permi .....

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oss-objections referred to in sub-section (4), be accompanied by a fee as may be prescribed. (7) Subject to the provisions of this Act, in hearing and making an order on any appeal under this section, the Appellate Tribunal shall exercise the same powers and follow the procedure as it exercises and follows in hearing and making an order on any appeal under the Income-tax Act. Appeal to High Court. 19. (1) An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tr .....

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or the Chief Commissioner or the Principal Commissioner or the Commissioner or the assessee; (b) in the form of a memorandum of appeal precisely stating therein the substantial question of law involved. (3) The High Court may admit an appeal after the expiry of the period of one hundred and twenty days referred to in sub-section (2), if it is satisfied that there was sufficient cause for not filing the appeal within that period. (4) If the High Court is satisfied that a substantial question of .....

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e High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit. (8) The High Court may determine any issue which- (a) has not been determined by the Appellate Tribunal; or (b) has been wrongly determined by the Appellate Tribunal, by reason of a decision on the question of law referred to in sub-section (1). (9) The provisions of the Code of Civil Procedure, 1908, relat .....

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two Judges of the High Court and shall be decided in accordance with the opinion of such Judges or if the Bench is of more than two Judges, by the majority of such Judges. (2) Where there is no such majority, the Judges shall state the point of law upon which they differ and the case shall then be heard upon that point only by one or more of the other Judges of the High Court and such point shall be decided according to the opinion of the majority of the Judges who have heard the case including .....

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rees of a High Court. (2) The costs of the appeal shall be in the discretion of the Supreme Court. (3) 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 sub-section (10) of section 19. Revision of orders prejudicial to revenue. 23. (1) The Principal Commissioner or the Commissioner may, for the purposes of revising any order passed in any proceeding under this Act before any tax authority su .....

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be made, such inquiry as he considers necessary for the purposes of passing an order under sub-section (2). (4) The revision order passed by the Principal Commissioner or the Commissioner under sub-section (2) may have the effect of enhancing or modifying the assessment but shall not be an order cancelling the assessment and directing a fresh assessment. (5) The power of the Principal Commissioner or the Commissioner under sub-section (2) for revising an order shall extend to such matters as ha .....

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l, the High Court or the Supreme Court. (8) In computing the period of limitation under sub-section (6), the following shall not be included, namely:- (a) the time taken in giving an opportunity to the assessee to be reheard under section 7; or (b) any period during which any proceeding under this section is stayed by an order or injunction of any court. (9) Without prejudice to the generality of the foregoing provisions, an order passed by a tax authority shall be deemed to be erroneous in so f .....

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case of the assessee or any other person under this Act or the Income-tax Act. (10) In this section, record shall include all records relating to any proceeding under this Act available at the time of examination by the Principal Commissioner or the Commissioner. Revision of other orders. 24. (1) The Principal Commissioner or the Commissioner may, either suo motu or on an application made by the assessee, for the purposes of revising any order passed by an authority subordinate to him, other th .....

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expired; (b) against which an appeal is pending before the Commissioner (Appeals); or (c) which has been considered and decided in any appeal. (4) The assessee shall make the application for revision of any order referred to in sub-section (1), within a period of one year from the date on which the order sought to be revised was communicated to him, or the date on which he otherwise came to know of it, whichever is earlier. (5) The Principal Commissioner or the Commissioner may, if he is satisf .....

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r in which an application is made by the assessee under sub-section (4); or (b) a period of one year from the date of the order sought to be revised, if the order is revised suomotu by the Commissioner. (8) In computing the period of limitation under sub-section (7), the following shall not be included, namely:- (a) the time taken in giving an opportunity to the assessee to be reheard under section 7; or (b) any period during which any proceeding under this section is stayed by an order or injun .....

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ecution of the order in respect of the costs awarded by the Supreme Court, transmit such order for execution to any court subordinate to it. Amendment of assessment on appeal. 27. Where as a result of an appeal under section 15 or section 18, any change is made in the assessment of a body of individuals or an association of persons or an order for new assessment of a body of individuals or an association of persons is made, the Commissioner (Appeals) or the Appellate Tribunal, as the case may be .....

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9. (1) The Board may, from time to time, issue orders, instructions or directions to other tax authorities, fixing such monetary limits as it may deem fit, for the purpose of regulating the filing of appeal by any tax authority under this Chapter. (2) Where, in pursuance of the orders, instructions or directions issued under sub-;section (1), a tax authority has not filed any appeal on any issue in the case of an assessee for any financial year, it shall not preclude such authority from filing a .....

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y case. (4) The Appellate Tribunal, hearing such appeal, shall have regard to the orders, instructions or directions issued under sub-section (1) and the circumstances under which such appeal was filed or not filed in respect of any case. (5) Every order, instruction or direction which has been issued by the Board fixing monetary limits for filing an appeal shall be deemed to have been issued under sub-section (1) and the provisions of sub-sections (2), (3) and (4) shall apply accordingly. Recov .....

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int Commissioner, reduce such period as he deems fit. (3) The Assessing Officer may, on an application made by the assessee, before the expiry of a period of thirty days or the period reduced under sub-section (2) or during the pendency of appeal with the Commissioner (Appeals), extend the time for payment, or allow payment by instalments, subject to such conditions as he may think fit to impose in the circumstances of the case. (4) An assessee shall be deemed to be an assessee in default, if th .....

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ery Officer, recover the amount in respect of which the assessee is in default, or is deemed to be in default, by any one or more of the modes provided in section 32. (7) The Tax Recovery Officer shall be vested with the powers to recover the tax arrear on drawing up of a statement of tax arrear under section 31. Recovery of tax dues by Tax Recovery Officer. 31. (1) The Tax Recovery Officer may draw up under his signature a statement of tax arrears of an assessee referred to in sub-section (4) o .....

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payment by instalments, subject to such conditions as he may think fit to impose in the circumstances of the case. (5) The Tax Recovery Officer shall proceed to recover from the assessee the amount specified in the certificate by one or more of the modes referred to in section 32 or in the Second Schedule to the Income-tax Act. (6) It shall not be open to the assessee to dispute the correctness of any certificate drawn up by the Tax Recovery Officer on any ground whatsoever, but it shall be law .....

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e Central Government in such manner as may be prescribed. (3) Any part of the salary, exempt from attachment in execution of a decree of a civil court under section 60 of the Code of Civil Procedure, 1908, shall be exempt from any requisition made under sub-section (1). (5 of 1908.) (4) 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 .....

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account, to all the joint holders at their last addresses known to the Assessing Officer or the Tax Recovery Officer. (7) It shall not be necessary for any pass book, deposit receipt, policy or any other document to be produced for the purpose of any entry, endorsement or the like being made before payment is made, notwithstanding any rule, practice or requirement to the contrary if the notice under sub-section (4) is issued to a post office, banking company, insurer or any other person. (8) Any .....

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any money for, or on account of, the assessee. (10) The person referred to in sub-section (9) shall be personally liable to the Assessing Officer or the Tax Recovery Officer, as the case may be, to the extent of his own liability to the assessee on the date of the notice, or to the extent of the liability of the assessee for any sum due under this Act, whichever is less, if it is discovered that the statement made by him was false in any respect. (11) The Assessing Officer or the Tax Recovery O .....

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under sub-section (4) shall be personally liable to the Assessing Officer or the Tax Recovery Officer to the extent of his own liability to the assessee so discharged or to the extent of the liability of the assessee for any sum due under this Act, whichever is less. (14) The debtor to whom a notice under sub-section (4) is sent shall be deemed to be an assessee in default, if he fails to make such payment and further proceedings may be initiated against him for the realisation of the amount in .....

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and sale of any movable property under the Second Schedule to the Income-tax Act, if he is so authorised by the Principal Chief Commissioner or the Chief Commissioner, or the Principal Commissioner or the Commissioner, by general or special order. (17) In this section,- (a) debtor in relation to an assessee, means,- (i) any person from whom any money is due, or may become due, to the assessee; or (ii) any person who holds, or may subsequently hold, any money for, or on account of, the assessee; .....

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i) the principal place of business of the assessee is situate; (iii) the assessee resides; or (iv) any movable or immovable property of the assessee is situate; or (b) who has been assigned jurisdiction under section 6. (2) The Tax Recovery Officer, referred to in sub-section (1), may send a certificate, in such manner as may be prescribed, specifying the tax arrear to be recovered, to another Tax Recovery Officer within whose jurisdiction the assessee resides or has property, if the firstmentio .....

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d proceed to recover the amount in accordance with the provisions of this Chapter. Recovery of tax dues in case of a company in liquidation. 34. (1) The liquidator shall inform the Assessing Officer, who has jurisdiction to assess the undisclosed foreign income and asset of the company, of his appointment within a period of thirty days of his becoming the liquidator. (2) The Assessing Officer shall, within a period of three months from the date on which he receives the information, intimate to t .....

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from the Assessing Officer under sub-section (2), the amount so intimated shall, notwithstanding anything in any other law for the time being in force, be the first charge on the assets of the company remaining after payment of the following dues, namely:- (a) workmen s dues; and (b) debts due to secured creditors to the extent such debts under clause (iii) of the proviso to sub-section (1) of section 325 of the Companies Act, 2013 paripassu with such dues. (18 of 2013.) (5) The liquidator shal .....

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r law for the time being in force. (8) In this section,- (a) liquidator in relation to a company which is being wound up, whether under the orders of a court or otherwise, shall include a receiver of the assets of the company; (b) workmen s dues shall have the meaning assigned to it in section 325 of the Companies Act, 2013. (18 of 2013.) Liability of manager of a company. 35. (1) Every person being a manager at any time during the financial year shall be jointly and severally liable for the pay .....

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section, manager shall include a managing director and both shall have the meaning respectively assigned to them in clause (53) and clause (54) of section 2 of the Companies Act, 2013. (18 of 2013.) Joint and several liability of participants. 36. (1) Every person, being a participant in an unincorporated body at any time during the financial year, or the representative assessee of the deceased participant, shall be jointly and severally liable, along with the unincorporated body, for payment of .....

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Partnership Act, 2008. Recovery through State Government. 37. If the recovery of tax in any area has been entrusted to a State Government under clause (1) of article 258 of the Constitution, the State Government may direct, with respect to that area or any part thereof, that tax shall be recovered therein with, and as an addition to, any municipal tax or local rate, by the same person and in the manner as the municipal tax or local rate is recovered. Recovery of tax dues in pursuance of agreeme .....

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of section 73 of this Act, as the case may be, for the purposes of recovery of tax. (2) On receipt of the certificate under sub-section (3) from the Tax Recovery Officer, the Board may take such action thereon as it may deem appropriate having regard to the terms of the agreement with such country or a specified territory. Recovery by suit or under other law not affected. 39. (1) The several modes of recovery specified in this Chapter shall not affect in any way- (a) any other law for the time .....

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ere the assessee has any income from a source outside India which has not been disclosed in the return of income furnished under sub-section (1) of section 139 of the Income-tax Act or the return of income has not been furnished under the said sub-section, the interest shall be chargeable in accordance with the provisions of section 234A of the Income-tax Act. (2) Where the assessee has any undisclosed income from a source outside India and the advance tax on such income has not been paid in acc .....

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qual to three times the tax computed under that section. Penalty for failure to furnish return in relation to foreign income and asset. 42. If a person, being a resident other than not ordinarily resident in India within the meaning of clause (6) of section 6 of the Income-tax Act, who is required to furnish a return of his income for any previous year, as required under sub-section (1) of section 139 of the Income-tax Act or by the provisos to that sub-section, and who at any time during such p .....

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that this section shall not apply in respect of an asset, being one or more bank accounts having an aggregate balance which does not exceed a value equivalent to five hundred thousand rupees at any time during the previous year. Explanation.- For determining the value equivalent in rupees of the balance in an account maintained in foreign currency the rate of exchange for calculation of the value in rupees shall be the telegraphic transfer buying rate of such currency as on the date for which th .....

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e for any previous year under sub-section (1) or sub-section (4) or sub-section (5) of section 139 of the said Act, fails to furnish any information or furnishes inaccurate particulars in such return relating to any asset (including financial interest in any entity) located outside India, held by him as a beneficial owner or otherwise, or in respect of which he was a beneficiary, or relating to any income from a source located outside India, at any time during such previous year, the Assessing O .....

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(1) Every person who is an assessee in default, or an assessee deemed to be in default, as the case may be, in making payment of tax, and in case of continuing default by such assessee, he shall be liable to a penalty of an amount, equal to the amount of tax arrear. (2) An assessee shall not cease to be liable to any penalty under sub-section (1) merely by reason of the fact that before the levy of such penalty he has paid the tax. Penalty for other defaults. 45. (1) A person shall be liable to .....

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nse to summons issued under section 8. (2) The penalty referred to in sub-section (1) shall be a sum which shall not be less than fifty thousand rupees but which may extend to two lakh rupees. Procedure. 46. (1) The tax authority shall, for the purposes of imposing any penalty under this Chapter, issue a notice to an assessee requiring him to show cause why the penalty should not be imposed on him. (2) The notice referred to in sub-section (1) shall be issued- (a) during the pendency of any proc .....

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if- (a) the penalty exceeds one lakh rupees and the tax authority levying the penalty is in the rank of Income-tax Officer; or (b) the penalty exceeds five lakh rupees and the tax authority levying the penalty is in the rank of Assistant Commissioner or Deputy Commissioner. (5) Every order of penalty issued under this Chapter shall be accompanied by a notice of demand in respect of the amount of penalty imposed and such notice of demand shall be deemed to be a notice under section 13. Bar of li .....

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o the order of the Commissioner (Appeals), the Appellate Tribunal, the High Court or the Supreme Court or order of revision under section 23 or section 24. (3) An order revising or reviving the penalty under sub-section (2) shall not be passed after the expiry of a period of six months from the end of the month in which order of the Commissioner (Appeals), the Appellate Tribunal, the High Court or the Supreme Court is received by the Principal Chief Commissioner or the Chief Commissioner or the .....

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IONS Chapter not in derogation of any other law or any other provision of this Act. 48. (1) The provisions of this Chapter shall be in addition to, and not in derogation of, the provisions of any other law providing for prosecution for offences thereunder. (2) The provisions of this Chapter shall be independent of any order under this Act that may be made, or has not been made, on any person and it shall be no defence that the order has not been made on account of time limitation or for any othe .....

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rnish in due time the return of income which he is required to furnish under sub-section (1) of section 139 of that Act, he shall be punishable with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine: Provided that a person shall not be proceeded against under this section for failure to furnish in due time the return of income under sub-section (1) of section 139 of the Income-tax Act if the return is furnished by him befor .....

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ils to furnish in such return any information relating to an asset (including financial interest in any entity) located outside India, held by him, as a beneficial owner or otherwise or in which he was a beneficiary, at any time during such previous year, or disclose any income from a source outside India, he shall be punishable with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine. Punishment for wilful attempt to evade t .....

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ayment of any tax, penalty or interest under this Act, he shall, without prejudice to any penalty that may be imposable on him under any other provision of this Act, be punishable with rigorous imprisonment for a term which shall not be less than three months but which may extend to three years and shall, in the discretion of the court, also be liable to fine. (3) For the purposes of this section, a wilful attempt to evade any tax, penalty or interest chargeable or imposable under this Act or th .....

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causes any other circumstance to exist which will have the effect of enabling such person to evade any tax, penalty or interest chargeable or imposable under this Act or the payment thereof. Punishment for false statement in verification. 52. If a person, makes a statement in any verification under this Act or under any rule made thereunder, or delivers an account or statement which is false, and which he either knows or believes to be false, or does not believe to be true, he shall be punishab .....

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imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine. Presumption as to culpable mental state. 54. (1) In any prosecution for any offence under this Act which requires a culpable mental state on the part of the accused, the court shall presume the existence of such mental state but it shall be a defence for the accused to prove the fact that he had no such mental state with respect to the act charged as an offence in that prosecution. .....

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A person shall not be proceeded against for an offence under section 49 to section 53 (both inclusive) except with the sanction of the Principal Commissioner or Commissioner or the Commissioner (Appeals), as the case may be. (2) The Principal Chief Commissioner or the Chief Commissioner may issue such instructions, or directions, to the tax authorities referred to in sub-section (1) as he may think fit for the institution of proceedings under this section. (3) The power of the Board to issue or .....

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was committed, was in charge of, and was responsible to, the company for the conduct of the business of the company as well as the company shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly. (2) Nothing in sub-section (1) shall render any such person liable to any punishment if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence. (3) Notwi .....

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under this Act has been committed by a person, being a company, and the punishment for such offence is imprisonment and fine, then, without prejudice to sub-section (1) or sub-section (3), such company shall be punished with fine and every person, referred to in sub-section (1), or the director, manager, secretary or other officer of the company referred to in sub-section (3), shall be liable to be proceeded against and punished in accordance with the provisions of this Act. (5) In this section- .....

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e entries in the records, or other documents, in the custody of a tax authority shall be admitted in evidence in any proceeding for the prosecution of any person for an offence under this Chapter. (2) The entries referred to in sub-section (1) may be proved by the production of- (a) the records or other documents (containing such entries) in the custody of the tax authority; or (b) a copy of the entries certified by that authority under its signature, as true copy of the original entries contain .....

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es, but which may extend to one crore rupees. CHAPTER VI TAX COMPLIANCE FOR UNDISCLOSED FOREIGN INCOME AND ASSETS Declaration of undisclosed foreign asset. 59. Subject to the provisions of this Chapter, any person may make, on or after the date of commencement of this Act but on or before a date to be notified by the Central Government in the Official Gazette, a declaration in respect of any undisclosed asset located outside India and acquired from income chargeable to tax under the Income-tax A .....

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material facts necessary for the assessment or otherwise. Charge of tax. 60. Notwithstanding anything contained in the Income-tax Act or in any Finance Act, the undisclosed asset located outside India and declared under section 59 within the time specified therein shall be chargeable to tax at the rate of thirty per cent. of value of such undisclosed asset on the date of commencement of this Act. Penalty. 61. Notwithstanding anything contained in the Income-tax Act or in any Finance Act, the pe .....

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imself; where such individual is absent from India, by the individual concerned or by some person duly authorised by him in this behalf; and where the individual is mentally incapacitated from attending to his affairs, by his guardian or by any other person competent to act on his behalf; (ii) where the declarant is a Hindu undivided family, by the karta, and where the karta is absent from India or is mentally incapacitated from attending to his affairs, by any other adult member of such family; .....

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he declarant is any other association, by any member of the association or the principal officer thereof; and (vi) where the declarant is any other person, by that person or by some other person competent to act on his behalf. (3) Any person, who has made a declaration under sub-section (1) in respect of his asset or as a representative assessee in respect of the asset of any other person, shall not be entitled to make any other declaration, under that sub-section in respect of his asset or the .....

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Commissioner or the Commissioner before whom the declaration under section 59 was made. (3) If the declarant fails to pay the tax in respect of the declaration made under section 59 on or before the date notified under sub-section (1), the declaration filed by him shall be deemed never to have been made under this Chapter. Undisclosed foreign asset declared not to be included in total income. 64. The amount of undisclosed investment in an asset located outside India declared in accordance with .....

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d thereon, to reopen any assessment or reassessment made under the Income-tax Act or the Wealth-tax Act, 1957 or claim any set off or relief in any appeal, reference or other proceeding in relation to any such assessment or reassessment. (27 of 1957.) Tax in respect of voluntarily disclosed asset not refundable. 66. Any amount of tax paid under section 60 or penalty paid under section 61 in pursuance of a declaration made under section 59 shall not be refundable. Declaration not admissible in ev .....

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13 or the Customs Act, 1962. (27 of 1957. 42 of 1999. 18 of 2013. 52 of 1962.) Declaration by misrepresentation of facts to be void. 68. Notwithstanding anything contained in this Chapter, where a declaration has been made by misrepresentation or suppression of facts, such declaration shall be void and shall be deemed never to have been made under this Chapter. Exemption from wealthtax in respect of assets specified in declaration. 69. (1) Where the undisclosed asset located outside India is rep .....

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rn of net wealth furnished by him for the said assessment year or years, then, notwithstanding anything contained in the Wealth-tax Act, 1957 or any rules made thereunder,- (27 of 1957.) (I) wealth-tax shall not be payable by the declarant in respect of the assets referred to in clause (a) or clause (b) and such assets shall not be included in his net wealth for the said assessment year or years; (II) the amount by which the value of the assets referred to in clause (c) has been understated in t .....

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ng the net wealth of any partner of the firm or, as the case may be, in determining the value of the interest of any partner in the firm. (2) The provisions of sub-section (1) shall not apply unless the conditions specified in sub-sections (1) and (2) of section 63 are fulfilled by the declarant. Applicability of certain provisions of Income-tax Act and of Chapter V of Wealth-tax Act. 70. The provisions of Chapter XV of the Income-tax Act relating to liability in special cases and of section 189 .....

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and Prevention of Smuggling Activities Act, 1974: (52 of 1974.) Provided that- (i) such order of detention, being an order to which the provisions of section 9 or section 12A of the said Act do not apply, has not been revoked on the report of the Advisory Board under section 8 of the said Act or before the receipt of the report of the Advisory Board; or (ii) such order of detention, being an order to which the provisions of section 9 of the said Act apply, has not been revoked before the expiry .....

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ction 8, read with sub-section (6) of section 12A, of the said Act; or (iv) such order of detention has not been set aside by a court of competent jurisdiction; (b) in relation to prosecution for any offence punishable under Chapter IX or Chapter XVII of the Indian Penal Code, the Narcotic Drugs and Psychotropic Substances Act, 1985, the Unlawful Activities (Prevention) Act, 1967, the Prevention of Corruption Act, 1988; (45 of 1860. 61 of 1985. 37 of 1967. 49 of 1988. 27 of 1992.) (c) to any per .....

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3C of the Income-tax Act has been issued in respect of such assessment year and the proceeding is pending before the Assessing Officer; or (ii) where a search has been conducted under section 132 or requisition has been made under section 132A or a survey has been carried out under section 133A of the Income-tax Act in a previous year and a notice under sub-section (2) of section 143 for the assessment year relevant to such previous year or a notice under section 153A or under section 153C of th .....

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lance or not. Removal of doubts. 72. For the removal of doubts, it is hereby declared that- (a) save as otherwise expressly provided in the Explanation to sub-section (1) of section 69, nothing contained in this Chapter shall be construed as conferring any benefit, concession or immunity on any person other than the person making the declaration under this Chapter; (b) where any declaration has been made under section 59 but no tax and penalty has been paid within the time specified under sectio .....

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II GENERAL PROVISIONS Agreement with foreign countries or specified territories. 73. (1) The Central Government may enter into an agreement with the Government of any other country- (a) for the granting of relief in respect of - (i) income on which tax has been paid both under this Act and under the corresponding law in force in that country; or (ii) tax chargeable under this Act; (b) for the avoidance of double taxation of income under this Act and under the corresponding law in force in that c .....

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ountry. (2) The Central Government may enter into an agreement with the Government of any specified territory outside India for the purposes specified in sub-section (1). (3) The Central Government may, by notification, make such provisions as may be necessary for implementing the agreements referred to in sub-sections (1) and (2). (4) Any specified association in India may enter into an agreement with any specified association in the specified territory outside India for the purposes of sub-sec .....

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ed to have effect from the date on which the said agreement came into force. Service of notice generally. 74. (1) The service of any notice, summons, requisition, order or any other communication under this Act (herein referred to in this section as communication ) may be made by delivering or transmitting a copy thereof, to the person named therein,- (a) by post or by such courier service as may be approved by the Board; (5 of 1908.) (b) in such manner as provided under the Code of Civil Proced .....

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or transmitted to the person named therein. (3) In this section, the expressions electronic mail and electronic mail message shall have the same meanings as assigned to them in the Explanation to section 66A of the Information Technology Act, 2000. (21 of 2000.) Authentication of notices and other documents. 75. (1) A notice or any other document required to be issued, served or given for the purposes of this Act by any tax authority shall be authenticated by that authority. (2) Every notice or .....

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mstances. 76. (1) A notice which is required to be served upon a person for the purposes of assessment under this Act shall be deemed to have been duly served upon him in accordance with the provisions of this Act, if the person has appeared in any proceeding or co-operated in any inquiry relating to an assessment. (2) The person, referred to in sub-section (1), shall be precluded from taking any objection in any proceeding or inquiry under this Act that the notice was- (a) not served upon him; .....

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ssioner or the Commissioner in accordance with such rules as may be prescribed. (2) The provisions of sub-section (1) shall not apply in a case where the assessee is required to attend personally for examination on oath or affirmation under section 8. Appearance by authorised representative. 78. (1) Any assessee who is entitled or required to attend before any tax authority or the Appellate Tribunal, in connection with any proceeding under this Act, may attend through an authorised representativ .....

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s other regular dealings; (c) any legal practitioner who is entitled to practice in any civil court in India; (d) an accountant; (e) any person who has passed any accountancy examination recognised in this behalf by the Board; or (f) any person who has acquired such educational qualifications as may be prescribed. (4) The following persons shall not be qualified to represent an assessee under sub-section (1), namely:- (a) a person who has been dismissed or removed from Government service; (b) a .....

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4) shall continue, having regard to the nature of misconduct and such disqualification shall not exceed- (i) in case of clauses (a) and (c) of sub-section (4), a period of ten years; (ii) in case of clause (b) of sub-section (4), the period for which the legal practitioner or an accountant is not entitled to practice. (6) A person shall not be allowed to appear as an authorised representative, if he has committed any fraud or misrepresented the facts which resulted in loss to the revenue and tha .....

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cordance with this Act shall be rounded off to the nearest multiple of one hundred rupees. (2) Any amount payable or receivable by the assessee under this Act shall be rounded off to the nearest multiple of ten rupees. (3) The method of rounding off under sub-section (1) or sub-section (2), shall be such as may be prescribed. Congnizance of offences. 80. No court inferior to that of a metropolitan magistrate or a magistrate of the First Class shall try any offence under this Act. Assessment not .....

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t and purpose of this Act. Bar of suits in civil courts. 82. (1) No suit shall be brought in any civil court to set aside or modify any proceeding taken or order made under this Act. (2) No prosecution, suit or other proceeding shall lie against the Government or any officer of the Government, for anything in good faith done or intended to be done, under this Act. Income-tax papers to be available for purposes of this Act. 83. Notwithstanding anything contained in the Income-tax Act, all informa .....

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difications as if the said provisions refer to undisclosed foreign income and asset instead of to income-tax. Power to make rules. 85. (1) The Board may, subject to the approval of the Central Government, by notification in the Official Gazette, make rules for carrying out the provisions of this Act. (2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters:- (a) the manner of determination of the value of an .....

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s under sub-section (1) of section 31; (f) the manner in which the sum is to be paid to the credit of central Government under sub-section (2) or sub-section (5) of section 32; (g) the manner in which the Tax Recovery Officer shall send a certificate referred to in sub-section (2) of section 33; (h) the form in which a declaration referred to in sub-section (1) of section 62 is to be made and the manner in which it is to be verified; (i) the means of transmission of documents under clause (d) of .....

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o be, or may be, prescribed. (3) The power to make rules conferred by this section shall include the power to give retrospective effect to the rules or any of them from a date not earlier than the date of commencement of this Act and no retrospective effect shall be given to any rule so as to prejudicially affect the interest of assessees. (4) The Central Government shall cause every rule made under this Act to be laid as soon as may be after it is made before each House of Parliament while it i .....

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lment shall be without prejudice to the validity of anything previously done under that rule. Power to remove difficulties. 86. (1) If any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by order, not inconsistent with the provisions of this Act, remove the difficulty : Provided that no such order shall be made after the expiry of a period of two years from the date on which the provisions of this Act come into force. (2) Every order made under this .....

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n of Money Laundering Act, 2002 in the Schedule, in Part C, after entry 3 relating to the offences against property under Chapter XVII of the Indian Penal Code, the following entry shall be inserted, namely:- (4) The offence of wilful attempt to evade any tax, penalty or interest referred to in section 51 of the Undisclosed Foreign Income and Assets (Imposition of Tax) Act, 2015 . (45 of 1860.) STATEMENT OF OBJECTS AND REASONS Stashing away of black money abroad by some people with intent to eva .....

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which could threaten the national security. 2. The Central Government is strongly committed to the task of tracking down and bringing back undisclosed foreign assets and income which legitimately belong to the nation. Recognising the limitations of the existing legislation, it is proposed to introduce a new legislation to deal with undisclosed assets and income stashed away abroad. 3. The Supreme Court of India has also expressed concern over this issue. The Special Investigation Team constitut .....

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gn assets. Such persons may file a declaration before the specified tax authority within a specified period, followed by payment of tax at the rate of 30 per cent and an equal amount by way of penalty. Exemptions, deductions, set off and carried forward losses etc. shall also be not allowed under the new legislation. Upon fulfilling these conditions, a person shall not be prosecuted under the Bill and the declaration made by him will not be used as evidence against him under the Wealth-tax Act, .....

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the amount of tax (i.e., 90 per cent of the undisclosed income or the value of the undisclosed asset). Failure to furnish return of income by person holding foreign asset, failure to disclose the foreign asset in the return or furnishing of inaccurate particulars of such asset shall attract a penalty of ₹ 10 lakh. (ii) The Bill provides for criminal liability with enhanced punishment. Wilful attempt to evade tax in relation to a foreign income will be punished with rigorous imprisonment fr .....

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ce will be punishable with rigorous imprisonment for a term of three years to ten years and with fine of ₹ 1 crore to ₹ 25 lakh. In prosecution proceedings, the wilful nature of the default shall be presumed and it shall be for the accused to prove the absence of the guilty state of mind. (iv) To facilitate enquiry and investigation, authorities under the Act have been vested with the powers of discovery and inspection, issue of commissions, issue of summonses, enforcement of attenda .....

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written orders. Appeal to the Income-tax Appellate Tribunal, and to the jurisdictional High Court and the Supreme Court on substantial questions of law have been provided for. (vii) Persons holding foreign accounts with minor balances which may not have been reported out of oversight or ignorance have been protected from criminal consequences. (viii) The Bill also proposes to amend Prevention of Money Laundering Act (PMLA), 2002 to include offence of tax evasion under the proposed legislation as .....

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tional security. 7. The Notes on clauses explain, in detail, the provisions of the Undisclosed Income and Assets (Imposition of Tax) Act, 2015. 8. The Bill seeks to achieve the above objectives. NEW DELHI; ARUN JAITELY The 19th March, 2015. - PRESIDENT S RECOMMENDATION UNDER ARTICLES 117(1) AND 274(1) OF THE CONSTITUTION OF INDIA [Copy of letter No. F. 133/9/2015TPL, dated the 18th March, 2015 from Shri Arun Jaitely, Minister of Finance to the Secretary General, Lok Sabha]. The President, having .....

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of India. It also provides that unless otherwise specified, it shall come into force on the 1st day of April, 2016. Clause 2.-deals with definitions. The said clause provides definition of the terms used in this Bill and which have not been separately provided in the respective Chapters. It defines certain terms such as assessee , undisclosed foreign income and asset , undisclosed asset located outside India etc. It also provides that all other words and expressions used in this Bill but not def .....

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manner. Clause 4.-deals with the scope of total undisclosed foreign income and asset. It provides that the total undisclosed foreign income and asset of any previous year of an assessee shall be,- (a) the income from a source located outside India, which has not been disclosed in the return of income furnished under sub-section (1) or sub-section (4) or subsection (5) of section 139 of the Income-tax Act; (b) the income, from a source located outside India ,in respect of which a return is requir .....

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section 29 to section 43C or section 57 to section 59 or section 92C of the said Act shall not be included in the total undisclosed foreign income. It also provides that the income included in the total undisclosed foreign income and asset under this Act shall not from part of the total income under the Income-tax Act. Clause 5.-deals with the computation of total undisclosed foreign income and asset. It, inter alia, provides that in computing the total undisclosed foreign income and asset no d .....

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isclosed asset located outside India, if, the assessee furnishes evidence to the satisfaction of the Assessing Officer that the asset has been acquired from such income which has been assessed or is assessable, as the case may be to tax. It also gives an illustration to explain the methodology for proportionate deduction of the amount assessed to tax in the case of an immovable property. Clause 6.-provides that the Income-tax authorities specified in section 116 of the Income-tax Act, 1961 (here .....

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horities under this Act as they apply in relation to the control of the corresponding income-tax authorities. However, the Board may, by notification in the Official Gazette, make exception in this regard. Clause 7.-provides that the tax authority who succeeds another authority as a result of change in jurisdiction or for any other reason, shall continue the proceedings from the stage at which it was left by his predecessor. It also provides that in such case the assessee may be given an opportu .....

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king 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 that for the purposes of making any inquiry or investigation, the prescribed tax authority shall be vested with the powers referred to above, whether or not any proceedings are pending before it. The said clause also provides that any prescribed tax authority may, subject to the rules made in this behalf, impound any books of .....

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er or the Principal Commissioner or the Commissioner. Clause 9.-provides that any proceeding under this Act before a tax authority shall be deemed to be a judicial proceeding within the meaning of section 194 and section 229 and for the purposes of section 197 of the Indian Penal Code, 1860. It further provides that every tax authority shall be deemed to be a civil court for the purposes of section 196, but not for the purposes of Chapter XXVI of the Code of Criminal Procedure, 1973. Clause 10.- .....

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dence as the Assessing Officer may require for the purposes of this Act. The Assessing Officer may, from time to time, serve further notices requiring the production of such other accounts or documents or evidence as he may require. It further provides that the Assessing Officer may make such inquiry, as he considers necessary, for the purpose of obtaining full information in respect of undisclosed foreign income and asset of any person for the relevant financial year. It also provides that the .....

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is judgment and determine the sum payable by the assessee. Clause 11.-provides the time limit for completion of assessment and reassessment. It also provides that such time limit shall not apply in respect of the assessment or re-assessment made in the consequence of, or to give effect to, any finding or direction contained in an order of the Appellate Authorities or any Court in a proceeding otherwise than by way of appeal under the Act. The said clause also provides that in computing the perio .....

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in the said order. Clause 12.-relating to rectification of mistake, inter alia, provides that a tax authority may amend any order passed by it so as to rectify any mistake apparent from the record. It further provides that no amendment under this clause shall be made after a period of four years from the end of the financial year in which the order sought to be amended was passed. It also provides that the tax authority shall, before making an amendment which has the effect of enhancing the undi .....

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it is received. Clause 13.-provides that any sum payable in consequence of any order made under this Act shall be demanded by a tax authority by serving upon the assessee a notice of demand in such form and manner as may be prescribed. Clause 14.-provides that neither the direct assessment of the person on whose behalf or for whose benefit the undisclosed income from a source located outside India is receivable or undisclosed asset located outside India is held, nor the recovery from such person .....

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rder of rectification having the effect of enhancing the assessment or reducing the refund; or (e) objects to an order refusing to allow the claim made by him for a rectification. It further provides that for the time period for filing an appeal and the form and manner in which the appeal is to be filed. Clause 16.-relates to procedure to be followed in case of an appeal before the Commissioner (Appeals). It, inter alia, provides that the Commissioner (Appeals) may, before disposing of any appea .....

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hat the Commissioner (Appeals) may consider and decide any matter which was not considered by the Assessing Officer. Clause 18.-relates to appeal to the Appellate Tribunal and, inter alia, provides that any assessee aggrieved by an order passed by Commissioner (Appeals) or the Principal Commissioner or the Commissioner may appeal to the Appellate Tribunal against such order. Similarly, the Principal Commissioner or the Commissioner may, if he objects to any order passed by the Commissioner (Appe .....

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ing it within that time and the delay in filing the appeal does not exceed a period of one year. It also provides that in hearing and making an order on any appeal under this Act, the Appellate Tribunal shall exercise the same powers and follow the procedure as it exercises and follows in hearing and making an order on any appeal under the Income-tax Act. Clause 19.-relates to appeal to the High Court and provides that an appeal shall lie to the High Court from every order passed in appeal by th .....

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within that period. The said clause also provides that the High Court may exercise its power to hear the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question of law and shall decide the question of law so formulated and deliver such judgment as it deems fit. The effect shall be given to the order passed on the appeal by the Assessing Officer on the basis of a certified copy of the judgment. Clause 20.-provides that an appe .....

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ause 22.-relates to hearing before the Supreme Court and provides that the provisions of the Code of Civil Procedure, 1908, relating to appeals to the Supreme Court shall, so far as may be, apply in the case of appeals under clause 21 as they apply in the case of appeals from decrees of a High Court. It further 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 under clause 19. Cla .....

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e revision order may have the effect of enhancing or modifying the assessment but shall not be an order cancelling the assessment and directing a fresh assessment. Further, the power of the Principal Commissioner or the Commissioner for revising an order shall not extend to certain orders specified therein. Besides, no order shall be made after the expiry of a period of two years from the end of the financial year in which the order sought to be revised was passed. The said clause also provides .....

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order shall not be prejudicial to the assessee. The said clause further provides that the power of the Principal Commissioner or the Commissioner shall not extend to such orders as specified therein. The said clause also provides that the assessee shall make an application for revision of any order within the specified time, accompanied by the prescribed fee. Further the revision order shall not be passed after expiry of a period of one year from the end of the financial year in which such appli .....

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such order for execution to any court subordinate to it. Clause 27.-provides that where as a result of an appeal under clause 15 or clause 18, any change is made in the assessment of a body of individuals or an association of persons or an order for new assessment of a body of individuals or an association of persons is made, the Commissioner (Appeals) or the Appellate Tribunal, as the case may be, shall pass an order authorising the Assessing Officer either to amend the assessment made or make .....

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y deem fit, for the purpose of regulating the filing of appeal by any tax authority. The said clause further provides that where, in pursuance of such order, instruction or direction a appeal has not been filed by the tax authority on any issue in the case of an assessee for any financial year, it shall not be precluded from filing an appeal on the same issue in the case of the same assessee for any other financial year; or any other assessee for the same or any other financial year. The said cl .....

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within a period of thirty days of the service of the notice, to the credit of the Central Government in prescribed manner. However, where the Assessing Officer has any reason to believe that it will be detrimental to the interests of revenue, he may reduce the period for payment of tax with the previous approval of the Joint Commissioner. The said clause further provides that the Assessing Officer may before the expiry of the specified period or during the pendency of appeal with the Commission .....

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powers to recover the tax arrear on drawing up of a statement of tax arrear. Clause 31.-relating to recovery of tax dues by the Tax Recovery Officer seeks to, inter alia, provide that such officer may draw up under his signature a statement of tax arrears (certificate) and shall proceed to recover from the assessee the amount specified in the certificate by one or more of the modes referred to in clause 32 of this Bill or in the Second Schedule to the Income-tax Act. Clause 32.-inter alia, seek .....

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hin whose jurisdiction the assessee carries on his business; or the principal place of business of the assessee is situate; or the assessee resides; or any movable or immovable property of the assessee is situate; or who has been assigned jurisdiction under clause 6. This clause further provides that if the Tax Recovery Officer competent to take action under clause 31 is not able to recover the tax arrears, he may send a certificate to another Tax Recovery Officer within whose jurisdiction the a .....

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o the liquidator 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 35.-r .....

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he affairs of the company. These provisions shall prevail over anything to the contrary contained in the Companies Act, 2013. This clause further seeks to define the term manager . Clause 36.-relates joint and several liabilities of participants. It, inter alia, seeks to provide that every person, being a participant in an unincorporated body at any time during the financial year, or the representative assessee of the deceased participant, shall be jointly and severally liable, along with the un .....

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een entrusted to a State Government under clause (1) of article 258 of the Constitution, the State Government may direct, with respect to that area or any part thereof, that tax shall be recovered therein with, and as an addition to, any municipal tax or local rate, by the same person and in the manner as the municipal tax or local rate is recovered. Clause 38.-relates to recovery of tax dues in pursuance of agreements with foreign countries or specified territories. It seeks to, inter alia, pro .....

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assessee. Clause 40.-relates to interest for default in furnishing return and payment or deferment of advance tax. This clause seeks to provide that where the assessee has any income from a source outside India which has not been disclosed in the return of income furnished under sub-section (1) of section 139 of the Income-tax Act or the return of income has not been furnished under the said sub-section, interest shall be chargeable in accordance with the provisions of section 234A of the Incom .....

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where tax has been computed under clause 10 in respect of undisclosed foreign income and asset, the assessee shall pay by way of penalty, in addition to tax, if any, payable by him, a sum equal to three times the tax computed under that clause. Clause 42.-relates to penalty for failure to furnish return in relation to foreign income and asset. It seeks to provide that if a person, being a resident other than not ordinarily resident in India within the meaning of clause (6) of section 6 of the I .....

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ated outside India, and fails to furnish such return before the end of the relevant assessment year, the Assessing Officer may direct that such person shall pay, a penalty of ten lakh rupees. The said clause further provides that no penalty shall be levied in respect of an asset, being one or more bank accounts having an aggregate balance which does not exceed a value equivalent to five hundred thousand rupees at any time during the previous year. It also provides for determining the value equiv .....

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for any previous year under subsection (1) or sub-section (4) or sub-section (5) of section 139 of the said Act, fails to furnish any information or furnishes inaccurate particulars in such return relating to any asset (including financial interest in any entity) located outside India, held by him as a beneficial owner or otherwise, or in respect of which he was a beneficiary, or relating to any income from a source located outside India, at any time during such previous year, the Assessing Off .....

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to be in default in respect of payment of tax, and in case of continuing default by such assessee, he shall be liable to pay a penalty of an amount, equal to the amount of tax arrear. The said clause further provides that an assessee shall not cease to be liable to any penalty merely by reason of the fact that before the levy of such penalty he has paid the tax. Clause 45.-relates to penalty for other defaults. This clause seeks to, inter alia, provide that a person shall be liable to a penalty .....

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ot be imposed on him. It further provides that no order imposing a penalty shall be made under Chapter IV unless the assessee has been given an opportunity of being heard. The said clause also lays down the procedure for approval of an order by the Joint Commissioner. Clause 47.-relates to bar of limitation for imposing penalty. It, inter alia, provides for the time limit for passing the penalty orders. It further provides that in computing that period of limitation, certain specified time perio .....

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of Chapter IV shall be independent of any order under this Act that may be made, or has not been made, on any person and it shall be no defence that the order has not been made on account of time limitation or for any other reason. Clause 49.-relates to punishment for failure to furnish returns in relation to foreign income and asset. This clause seeks to, inter alia, provide that if a person, being a resident other than not ordinarily resident in India within the meaning of clause (6) of secti .....

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six months but which may extend to seven years and with fine. It further provides that a person shall not be punished if the return is furnished by him before the expiry of the assessment year. Clause 50.-relates to punishment for failure to furnish in return of income, any information about an asset (including financial interest in any entity) located outside India. It seeks to provide that if any person, being a resident other than not ordinarily resident in India within the meaning of clause .....

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India, he shall be punishable with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine. Clause 51.-relates to punishment for wilful attempt to evade tax. This clause seeks to provide that if a person, being a resident other than not ordinarily resident in India within the meaning of clause (6) of section 6 of the Income-tax Act, wilfully attempts in any manner whatsoever to evade any tax, penalty or interest chargeable or imp .....

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. The said clause also defines the term wilful attempt to evade . Clause 52.-relates to punishment for false statement in verification. This clause seeks to provide that if a person, makes a statement in any verification under this Act or under any rule made thereunder, or delivers an account or statement which is false, and which he either knows or believes to be false, or does not believe to be true, he shall be punishable with rigorous imprisonment for a term which shall not be less than six .....

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erm which shall not be less than six months but which may extend to seven years and with fine. Clause 54.-relates to presumption as to culpable mental state. This clause seeks to provide that in any prosecution for any offence under this Act which requires a culpable mental state on the part of the accused, the court shall presume the existence of such mental state. However, the said clause also provides that it shall be a defence for the accused to prove the fact that he had no such mental stat .....

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he Commissioner. The said clause, inter alia, seeks to provide that no person shall be proceeded against for an offence under clause 49 to clause 53 except with the sanction of the Principal Commissioner or Commissioner or the Commissioner (Appeals), as the case may be. The said clause further provides that the Principal Chief Commissioner or the Chief Commissioner may issue such instructions, or directions, to such Principal Commissioner or Commissioner or Commissioner (Appeals) as he may think .....

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said clause further provides that any such person shall not be so liable if he proves that the offence was committed without his knowledge or that he had exercised all due diligence to prevent the commission of such offence. The said clause also provides that where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or o .....

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ished in accordance with the provisions of this Act. The said clause also defines the term company and director . Clause 57.-relates to proof of entries in records or documents. This clause seeks to provide that the entries in the records, or other documents, in the custody of a tax authority shall be admitted in evidence in any proceeding for the prosecution of any person for an offence under this Chapter V. The said clause further provides that the entries may be proved by the production of th .....

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second and every subsequent offence with rigorous imprisonment for a term which shall not be less than three years, but which may extend to ten years and with fine which shall not be less than five lakh rupees, but which may extend to one crore rupees. Clause 59.-provides for declaration of undisclosed foreign asset. This clause seeks to provide that any person may, on or after the date of commencement of this Act but on or before a date to be notified by the Central Government in the Official .....

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of tax. This clause seeks to provide that notwithstanding anything contained in the Income-tax Act or in any Finance Act, the undisclosed asset located outside India and declared under clause 59 within the time specified therein shall be chargeable to tax at the rate of thirty per cent of value of such undisclosed asset on the date of commencement of this Act. Clause 61.-relates to penalty. This clause seeks to provide that notwithstanding anything contained in the Income-tax Act or in any Finan .....

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ation is made by any person under clause 59, then, who shall be competent to sign such a declaration. The said clause also provides that any person, who has made a declaration in respect of his asset or as a representative assessee in respect of the asset of any other person, he shall not be entitled to make any other declaration, in respect of his asset or the asset of such other person, and any such other declaration, if made, shall be deemed to be void. Clause 63.-relates to time for payment .....

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It also provides that if the declarant fails to pay the tax on or before the notified date, the declaration filed by him shall be deemed never to have been made. Clause 64.-provides that the amount of undisclosed investment in an asset located outside India declared in accordance with clause 59 shall not be included in the total income of the declarant for any assessment year under the Income-tax Act, if the declarant makes the payment of tax referred to in clause 60 and the penalty referred to .....

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d under clause 61 in pursuance of a declaration made under clause 59 shall not be refundable. Clause 67.-relates to declaration not admissible in evidence against declarant. The said clause seeks to provide that nothing contained in any declaration made under clause 59 shall be admissible in evidence against the declarant for the purpose of any proceeding relating to imposition of penalty, other than the penalty leviable under clause 61, or for the purposes of prosecution under the Income-tax Ac .....

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the declaration. The said clause, inter alia, seeks to provide that where the undisclosed asset located outside India is represented by cash (including bank deposits), bullion or any other assets specified in the declaration made under clause 59 in respect of which the declarant has not furnished a return under section 14 of the Wealth-tax Act, 1957 for the assessment year commencing on or before the 1st April, 2015; or which have not been shown or their value has been understated in the return .....

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ot exceed the voluntarily disclosed income utilised for acquiring such assets, shall not be taken into account in computing the net wealth of the declarant for the said assessment year or years. It also provides that where a declaration under clause 59 is made by a firm, such assets shall not be taken into account in computing the net wealth of any partner of the firm or in determining the value of the interest of any partner in the firm. It also provides that the above exemption from wealth tax .....

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in relation to proceedings under Chapter V as they apply in relation to proceedings under the Income-tax Act or, as the case may be, the Wealth-tax Act. Clause 71.-inter alia, provides that the Chapter VI relating to tax compliance for undisclosed foreign income and assets shall not apply to the persons and under the circumstances specified therein. Clause 72.-relates to removal of doubts. The said clause seeks to clarify that- (a) except as provided in the Explanation to sub-clause (1) of clau .....

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of this Act, and no declaration in respect of such asset is made under the said Chapter VI, such asset shall be deemed to have been acquired or made in the year in which a notice under clause 10 is issued by the Assessing Officer and the provisions of this Act shall apply accordingly. Clause 73.-relates to agreement with foreign countries or specified territories. The said clause, inter alia, seeks to provide that the Central Government may enter into an agreement with the Government of any oth .....

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, 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 India and the Central Government will notify the agreement for adopting it. Clause 74.-relates to service of notice generally. The said clause seeks to provide for the manner of service of any notice, summons, requisition, order etc. under this Act. Clause 75.-relates to authentication .....

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has raised the objection before the completion of the assessment. Clause 77.-relates to appearance by approved valuer in certain matters. The said clause seeks to provide that any assessee entitled or required to attend before any tax authority or the Appellate Tribunal, in connection with valuation of any asset, may attend through a approved valuer except where he is required to attend personally. Clause 78.-relates to appearance by authorised representative. The said clause, inter alia, seeks .....

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at the amount of undisclosed foreign income and asset computed in accordance with this Act shall be rounded off to the nearest multiple of one hundred rupees. It further provides that any amount payable or receivable by the assessee under this Act shall be rounded off to the nearest multiple of ten rupees. It also provides that the method of rounding off shall be such as may be prescribed. Clause 80.-relates to congnizance of offences. The said clause seeks to provide that no court inferior to t .....

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h assessment, notice, summons or other proceeding if such assessment, notice, summons or other proceeding is in substance and effect in conformity with or according to the intent and purpose of this Act. Clause 82.-relates to bar of suits in civil courts. The said clause seeks to provide that no suit shall be brought in any civil court to set aside or modify any proceeding taken or order made under this Act. The said clause further provides that no prosecution, suit or other proceeding shall lie .....

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f this Act. Clause 84.-relates to application of provisions of the Income-tax Act. The said clause seeks to specify certain sections of the Income-tax Act that shall apply with necessary modifications as if the said provisions refer to undisclosed foreign income and asset instead of to income tax. Clause 85.-relates to power to make rules. The said clause seeks to empower the Board to make rules for carrying out the provisions of this Act, subject to the approval of the Central Government. The s .....

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e effect from a date not earlier than the date of commencement of this Act. The said clause also specifies the time and consequence of laying of every rule made under this Act before each House of Parliament. Clause 86.-relates to power to remove difficulties. The said clause seeks to provide that if any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by an order, remove the difficulty. However, no such order shall be made after the expiry of a perio .....

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oard of Direct Taxes. Clause 88.-relates to amendment of Act 15 of 2003. The said clause seeks to include wilful attempt to evade tax in relation to undisclosed foreign income and asset referred to in clause 51 of the Undisclosed Foreign Income and Assets (Imposition of Tax) Act, 2015 in Part C of the Prevention of Money Laundering Act, 2002. FINANCIAL MEMORANDUM This Bill seeks to make provision for taxation of undisclosed income from a source, or the value of an undisclosed asset, located outs .....

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ide that the prescribed tax authorities shall, for the purposes of this Act, have the same powers as are vested in a court under the Code of Civil Procedure, 1908, while trying a suit in respect of the matters specified in the said clause. Further, sub-clause 3 of clause 8 of the Bill seeks to provide that any tax authority prescribed for the purposes of sub-clause (1) or sub-clause (2) of the said clause may, subject to the rules made in this behalf, impound any books of account or other docume .....

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n such manner and be accompanied by a fee as may be prescribed. 5. Sub-clause (4) of clause 18 of the Bill seeks to provide that the Assessing Officer or the assessee, as the case may be, on receipt of notice that an appeal against the order of the Commissioner (Appeals) has been preferred before the Appellate Tribunal under subclause (1) or sub-clause (2) of the said clause by the other party may, notwithstanding that he may not have appealed against such order or any part thereof, within thirt .....

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the case of an appeal referred to in sub-clause (2) or a memorandum of cross-objections referred to in sub-clause (4), be accompanied by a fee as may be prescribed. 6. Sub-clause (6) of clause 24 of the Bill seeks to provide that every application by an assessee for revision under this clause shall be accompanied by such fees as may be prescribed. 7. Sub-clause (1) of clause 30 of the Bill seeks to provide that any amount specified as payable in a notice of demand under clause 13 shall be paid .....

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ng Officer or the Tax Recovery Officer under sub-clause (1) of the said clause, the employer shall comply with the requisition and shall pay the sum so deducted to the credit of the Central Government in such manner as may be prescribed. Sub-clause (5) of the said clause provides that upon receipt of the notice from the Assessing Officer or the Tax Recovery Officer under sub-clause (4) of the said clause, the debtor of the assessee shall comply with the requisition and shall pay the sum to the c .....

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e jurisdiction the assessee resides or has property. 11. Sub-clause (1) of clause 62 of the Bill seeks to provide that a declaration, in respect of any undisclosed asset located outside India, under clause 59 of the Act shall be made to the Principal Commissioner or the Commissioner and shall be in such form and shall be verified in such manner as may be prescribed. 12. Sub-clause (1) of clause 74 of the Bill seeks to provide that the service of any notice, summons, requisition, order or any oth .....

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78 of the Bill seeks to provide that any assessee who is entitled or required to attend before any tax authority or the Appellate Tribunal, in connection with any proceeding under this Act, may attend through an authorised representative. Sub-clause (3) of the said clause provides that authorised representative means a person authorised by the assessee in writing to appear on his behalf, being any person who has acquired such educational qualifications as may be prescribed. Sub-clause (4) of the .....

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