TMI BlogNotes on clausesX X X X Extracts X X X X X X X X Extracts X X X X ..... e-tax in special cases during the financial year 2018-2019. Rates for deduction of tax at source during the financial year 2019-2020 from income other than Salaries Part II of the First Schedule to the Bill specifies the rates at which income-tax is to be deducted at source during the financial year 2019-2020 from income other than Salaries . The rates are the same, as those specified in Part II of the First Schedule to the Finance Act, 2018 for the purposes of deduction of income tax at source during the financial year 2018-2019. The amount of tax so deducted shall be increased by a surcharge in the case of- ( i ) every non-resident being an individual or Hindu undivided family or association of persons or body of individuals, whether incorporated or not, or every artificial juridical person referred to in sub-clause ( vii ) of clause ( 31 ) of section 2 of the Income tax Act,- ( a ) at the rate of ten per cent. of such tax, where the income or the aggregate of income paid or likely to be paid and subject to deduction exceeds fifty lakh rupees but does not exceed one crore rupees; ( b ) at the rate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Nil ₹ 2,50,001 to ₹ 5,00,000 5 per cent. ₹ 5,00,001 to ₹ 10,00,000 20 per cent. Above ₹ 10,00,000 30 per cent.; ( ii ) In the case of every individual, being a resident in India, who is of the age of sixty years or more but less than the age of eighty years at any time during the previous year:- Up to ₹ 3,00,000 Nil ₹ 3,00,001 to ₹ 5,00,000 5 per cent. ₹ 5,00,001 to ₹ 10,00,000 20 per cent. Above ₹ 10,00,000 30 per cent.; ( iii ) In the case of every individual, being a resident in India, who is of the age of eighty years or more at any time during the previous year : - Up to ₹ 5,00,000 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s year 2017-2018 does not exceed four hundred crore rupees and in all other cases the rate of income-tax shall be thirty per cent. of the total income. In the case of companies other than domestic companies, the rate of tax will continue to be the same as that specified for assessment year 2019-2020. Surcharge in the case of domestic companies having total income above one crore rupees but not above ten crore rupees shall be levied at the rate of seven per cent. In the case of domestic companies having total income above ten crore rupees, surcharge shall be levied at the rate of twelve per cent. In the case of companies other than domestic companies having income above one crore rupees but not above ten crore rupees surcharge shall be levied at the rate of two per cent. In the case of companies other than domestic companies having total income above ten crore rupees, surcharge shall be levied at the rate of five per cent. Marginal relief will be provided. In all other cases (including sections 115-O, 115QA, 115R, 115TA, 115TD, etc.), the surcharge will be applicable at the rate of twelve per cent. The existing Education Cess and Secondary a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d on or after the 5th day of July, 2019 by a person resident in India to a person outside India, shall be deemed to accrue or arise in India. This amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-2021 and subsequent assessment years. Clause 5 of the Bill seeks to amend section 9A of the Incometax Act relating to certain activities not to constitute business connection in India. Sub-section ( 3 ) of the said section provides for the conditions to be fulfilled for being an eligible investment fund. Clause ( j ) of the said sub-section provides that the monthly average of the corpus of the fund shall not be less than one hundred crore rupees. The first proviso to said clause further provides that where the fund has been established or incorporated in the previous year, the corpus of fund shall not be less than one hundred crore rupees at the end of such previous year. It is proposed to amend the said proviso so as to provide that where the fund has been established or incorporated in the previous year, the fund shall be required to fulfill the cond ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cent. to sixty per cent. It is proposed to insert sub-clause ( ix ) in the clause (15) so as to provide that any income by way of interest payable to a nonresident by a unit located in an International Financial Services Centre in respect of monies borrowed by it on or after 1st September, 2019 shall be exempted from tax. It is further proposed to insert an Explanation to define the expressions International Financial Services Centre and unit . These amendments will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020- 2021 and subsequent assessment years. Clause ( 34A ) of the said section provides for exemption to any income arising to a shareholder on account of buy-back of shares not being listed on a recognised stock exchange by the company as referred to in section 115QA. It is proposed to amend the said clause so as to provide the said exemption also to the income arising to a shareholder on account of buy-back of shares listed on a recognised stock exchange by the company as referred to in section 115QA. This amendment will take effect from 5th July, 2019. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause 8 of the Bill seeks to amend section 13A of the Incometax Act relating to special provision relating to the incomes of political parties. The said section provides that any income of a political party which is chargeable under the head Income from house property or Income from other sources or Capital Gains or income from voluntary contributions shall not be included in the total income of the previous year of such political party. The first proviso to the said section lays down conditions to be satisfied by a political party in order for the provisions of this section to be applicable. It is proposed to amend clause ( d ) of the said proviso so as to empower the Board to make rules to prescribe any other electronic mode through which a political party may also receive donations exceeding two thousand rupees. This amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-2021 and subsequent assessment years. Clause 9 of the Bill seeks to amend section 35AD of the Incometax Act relating to deduction in respect of expenditure on specified b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said sub-clause so as to provide that where an assessee fails to deduct the whole or any part of the tax in accordance with the provisions of Chapter XVII-B on any such sum but is not deemed to be an assessee in default under the first proviso to sub-section ( 1 ) of section 201, then, for the purposes of the said sub-clause, it shall be deemed that the assessee has deducted and paid the tax on such sum on the date of furnishing of return of income by the payee referred to in the first proviso to sub-section ( 1 ) of section 201. It is further proposed to make a similar consequential amendment in the second proviso to sub-clause ( ia ) of clause ( a ) of section 40 to omit the word resident . These amendments will take effect from 1st April, 2020, and will, accordingly, apply to the assessment year 2020-2021 and subsequent assessment years. Clause 11 of the Bill seeks to amend section 40A of the Incometax Act relating to expenses or payments not deductible in certain circumstances. Sub-sections ( 3 ), ( 3A ) and ( 4 ) of the said section provide for disallowance of any expenditure for which the assessee makes payment ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able by the assessee as interest on such borrowing, in accordance with the terms and conditions of the agreement governing such loan or borrowing, shall be allowed only in computing the income of such borrower in the previous year in which such sum is actually paid by him. It is proposed to amend the said section by inserting clause ( da ) to provide that in case of any loan or borrowing from any systemically important non-deposit taking non-banking financial company or a deposit taking non-banking financial company, deduction of any sum payable by the assessee as interest on such borrowing, in accordance with the terms and conditions of the agreement governing such loan or borrowing, shall be allowed in computing the income of such borrower only in the previous year in which such sum is actually paid by him. It is further proposed to insert Explanation 3AA in the said section to provide that where a deduction in respect of any sum referred to in clause ( da ) of this section is allowed in computing the income referred to in section 28 of the previous year (being a previous year relevant to the assessment year commencing on the 1st April, 2019, or any ea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-2021 and subsequent assessment years. Clause 15 of the Bill seeks to amend section 43D of the Incometax Act relating to special provision in case of income of public financial institutions, public companies, etc Clause ( a ) of the aforesaid section provides that in the case of a public financial institution, scheduled bank, cooperative bank other than a primary agricultural credit society or a primary cooperative agricultural and rural development bank or a State financial corporation or a State industrial investment corporation, the income by way of interest in relation to certain prescribed categories of bad or doubtful debts shall be chargeable to tax when it is actually received or when it is credited to the profit and loss account of such entity, whichever is earlier. It is proposed to amend the said section so as to insert reference of a deposit-taking non-banking financial company or a systemically important non-deposit taking non-banking financial company in order to extend the benefit of the provision of this s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions of the said section provide that any transfer of a capital asset, being bonds or Global Depository Receipts referred to in sub-section ( 1 ) of section 115AC or rupee denominated bond of an Indian company or derivative, made by a non-resident through a recognised stock exchange located in any International Financial Services Centre and where the consideration for such transaction is paid or payable in foreign currency, shall not be regarded as transfer. It is proposed to amend the said section so as to provide that any transfer of a capital asset, being bonds or Global Depository Receipts referred to in sub-section ( 1 ) of section 115AC or rupee denominated bond of an Indian company or derivative, made by a specified fund through a recognised stock exchange located in any International Financial Services Centre and where the consideration for such transaction is paid or payable in foreign currency, shall not be regarded as transfer. It is also proposed to provide that transfer, at a recognised stock exchange located in any International Financial Services Centre, of such other securities as may be notified by the Central Government in this beh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss of persons and subject to such conditions as may be prescribed. This amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-2021 and subsequent assessment years. Clause 20 of the Bill seeks to amend section 54GB of the Income-tax Act relating to capital gain on transfer of residential property not to be charged in certain cases. The said section, inter alia , provides that where the capital gain arises from the transfer of a long-term capital asset, being a residential property (a house or a plot of land), owned by the eligible assessee; and the assessee, before the due date of furnishing of return of income under sub-section ( 1 ) of section 139, utilises the net consideration for subscription in the equity shares of an eligible company; and the company has, within one year from the date of subscription in equity shares by the assessee, utilised this amount for purchase of new asset, then, the amount so utilised shall not be charged to tax as the income of the previous year. It is further provided that the new assets shall not be sold or otherwise transferred within a per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch shares as exceeds the fair market value of the shares shall not be charged to tax, if the consideration for issue of shares is received by a venture capital undertaking from a specified fund. It is further proposed to define the expression specified fund . It is also proposed to insert a second proviso to the said clause so as to provide that where the provisions of the said clause have not been applied to a company on account of fulfilment of conditions specified in the notification issued under clause ( ii ) of the first proviso and the company fails to comply with any of those conditions, then, any consideration received for issue of share that exceeds the face value of such shares shall be deemed to be the income of the company chargeable to income-tax for the previous year in which such failure has taken place. These amendments will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020- 2021 and subsequent assessment years. Clause ( viii ) of sub-section ( 2 ) of the said section provides that income by way of interest received on compensation or on enhanced compensation re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ides that where a change in shareholding has taken place during the previous year in the case of a company, not being a company in which the public are substantially interested, no loss incurred in any year prior to the previous year shall be carried forward and set off against the income of the previous year, unless on the last day of the previous year, the shares of the company carrying not less than fifty-one per cent. of the voting power were beneficially held by persons who beneficially held shares of the company carrying not less than fiftyone per cent. of the voting power on the last day of the year or years in which the loss was incurred. The proviso to sub-section ( 1 ) of the said section provides that if the above condition is not satisfied in case of an eligible start up as referred to in section 80-IAC, loss incurred in any year prior to the previous year shall still be allowed to be carried forward and set off against the income of the previous year if all the shareholders of such company who held shares carrying voting power on the last day of the year or years in which the loss was incurred, continue to hold those shares on the last day of such previous ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... diary of other company, if such other company holds more than half in nominal value of the equity share capital of the company. This amendment will take effect from 1st April, 2020 and will, accordingly, be applicable for assessment year 2020-2021 and subsequent assessment years. Clause 23 of the Bill seeks to amend section 80C of the Incometax Act relating to deduction in respect of life insurance premia, deferred annuity, contributions to provident fund, subscription to certain equity shares or debentures, etc. It is proposed to amend the said section so as to provide that any amount paid or deposited by the assessee, being an employee of the Central Government, as a contribution to a specified account of the pension scheme referred to in section 80CCD for a fixed period of not less than three years and which is in accordance with the scheme as may be notified by the Central Government in this behalf, shall be eligible for deduction. It is further proposed to define the expression specified account by insertion of an Explanation to the said clause. These amendments will take effect from 1st April, 2020 and will, accord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... housing projects. The provisions of the said section, inter alia , provide that where the gross total income of an assessee includes any profits and gains derived from the business of developing and building housing projects, there shall, subject to certain conditions, be allowed, a deduction of an amount equal to hundred per cent. of the profits and gains derived from such business. It is proposed to amend the said section so as to provide that a housing project approved on or after the 1st day of September, 2019 shall be eligible for deduction under this section if the carpet area of the residential unit comprised in the housing project does not exceed sixty square metres, where the project is located within the Metropolitan cities of Bengaluru, Chennai, Delhi National Capital Region (limited to Delhi, Noida, Greater Noida, Ghaziabad, Gurugram, Faridabad), Hyderabad, Kolkata and Mumbai (whole of Mumbai Metropolitan Region), or ninety square metres, where the project is located in any other place; and if the stamp duty value of a residential unit in the housing project does not exceed forty-five lakh rupees. It is also proposed to amend the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... evant law was obtained, and thereafter; ( b ) fifty per cent. of such income for five consecutive assessment years. It is proposed to amend the said section by substituting subsection ( 1 ) with sub-section ( 1 ) and ( 1A ) so as to provide that the deduction specified in the said section in respect of an an Unit of International Financial Services Centre shall be allowed at one hundred per cent. for ten years. In addition the deductions may, at the option of the assessee, be claimed by him for any ten consecutive assessment years out of fifteen years beginning with the assessment year relevant to the previous year in which the permission referred to in clause ( a ) of sub-section ( 1 ) of the said section was obtained. This amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-2021 and subsequent assessment years. Clause 29 of the Bill seeks to amend section 92CD of the Income-tax Act relating to effect to advance pricing agreement. Sub-section ( 3 ) of the said section provides that if the assessment or reassessment proceedings for an assessment year relevant t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enterprise shall be repatriated to India from such associated enterprise within prescribed time and in case of non-repatriation, interest thereon is to be computed deeming the same as advance to such associated enterprise. It is proposed to amend said sub-section so as to provide that the interest shall be computed on the excess money or part thereof and that the excess money can be repatriated from any of the associated enterprises of the assessee, which is not resident in India, besides the associated enterprise with which the excess money is available. These amendments will take effect retrospectively from 1st April, 2018 and will, accordingly, apply in relation to the assessment year 2018-2019 and subsequent assessment years. It is also proposed to insert sub-section ( 2A ) in the said section so as to provide that where the excess money or part thereof has not been repatriated in time, besides the existing requirement of calculation of interest, the assessee will have the option to pay additional income tax at the rate of eighteen per cent. on such excess money or part thereof. It is also proposed to insert sub-section (2B) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed section provides that the constituent entity referred to in clause (ii) of sub-section ( 1 ) shall furnish the information and document referred therein to the authority prescribed under sub-section ( 1 ) of section 286, in such manner, on or before such date as may be prescribed. These amendments will take effect from the 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020- 2021 and subsequent assessment years. Clause 32 of the Bill seeks to amend section 111A of the Incometax Act relating to tax on short-term capital gains in certain cases. Clause ( a ) of the Explanation to the said section provides that the equity oriented fund shall have the meaning assigned to it in the Explanation to clause ( 38 ) of section 10. It is proposed to amend the said Explanation so as to provide that equity oriented fund shall have the meaning assigned to it in clause ( a ) of the Explanation to section 112A. This amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-2021 and subsequent assessment years. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inted new directors who are nominated by the Central Government, under section 242 of the said Act. It is also proposed to amend the said section so as to provide that a company shall be a subsidiary of another company, if such other company holds more than half in nominal value of the equity share capital of the company. This amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-2021 and subsequent assessment years. Clause 35 of the Bill seeks to amend section 115-O of the Income-tax Act relating to tax on distributed profits of domestic companies. Sub-section ( 8 ) of the said section provides that notwithstanding anything contained in this section, no tax on distributed profits shall be chargeable in respect of the total income of a company, being a unit of an International Financial Services Centre, deriving income solely in convertible foreign exchange, for any assessment year on any amount declared, distributed or paid by such company, by way of dividends (whether interim or otherwise), on or after the 1st day of April, 2017, out of its current income, eith ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on, inter alia , provides that the loss of an investment fund for any previous year, being the net result of computation of total income of the investment fund, without giving effect to the exemption to income other than business income, under any head of income which cannot be or is not wholly set-off against income under any other head of income of the said previous year, shall be allowed to carry forward and set-off in accordance with the provisions of Chapter VI. Clause ( ii ) of said sub-section provides that such loss shall not accrue or arise or received by the unit holder. It is proposed to substitute the said sub-clauses so as to provide that,-- ( i ) the loss arising to the investment fund as a result of the computation under the head Profit and gains of business or profession , if any, shall be, allowed carry forward and set off in accordance with the provisions of Chapter VI; and such loss shall not accrue, or arise or received by the unit holder; and ( ii ) the other loss, if any, shall not accrue, or arise or received by the unit holder, if such loss has arisen in respect of a unit which has not been held by the un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020- 2021 and subsequent years. Clause 40 of the Bill seeks to amend section 139A of the Incometax Act relating to permanent account number. Sub-section ( 1 ) of the said section, inter alia , provides that every person specified therein and who has not been allotted a permanent account number shall apply to the Assessing Officer for allotment of a permanent account number. It is proposed to insert a new clause ( vii ) in the said sub-section so as to provide that every person, who intends to enter into such transaction, as may be prescribed by the Board in the interest of revenue, shall also apply to the Assessing Officer for allotment of a permanent account number. It is further proposed to insert a new sub-section ( 5E ) in the said section to provide that notwithstanding anything contained in this Act, every person who is required to furnish or intimate or quote his permanent account number under this Act, and who, has not been allotted a permanent account number and possesses the Aadhaar number, may, furnish or intimate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the Aadhaar number, on or before a date to be notified in the Official Gazette. It is proposed to amend the said proviso so as provide that if a person fails to intimate the Aadhaar number, the permanent account number allotted to such person shall be made inoperative after the notified date in the manner as may be provided by rules. This amendment will take effect from 1st September, 2019. Clause 42 of the Bill seeks to amend section 140A of the Incometax Act relating to self-assessment. The said section 140A, inter alia , provides for payment of selfassessment tax. It is proposed to insert a new clause ( iia ) in sub-section ( 1 ) of the said section, so as to provide that any relief of tax claimed under section 89 shall be taken into account for the purpose determining tax payable under the said sub-section. It is further proposed to insert a new sub-clause ( ba ) in clause ( i ) of sub-section ( 1A ) of the said section so as to provide that any relief of tax claimed under section 89 shall be taken into account for the purpose of determining interest payable under the said subsection. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said section provides for tax deduction at source at the rate of one per cent. on the amount of consideration paid for transfer of immovable property. Sub-section ( 2 ) provides that the tax deduction at source shall not be applicable where the amount of consideration does not exceed fifty lakh rupees. It is proposed to amend the Explanation to the said section to clarify the expression consideration for immovable property to include all charges of the nature of club membership fee, car parking fee, electricity or water facility fee, maintenance fee, advance fee or any other charges of similar nature, which are incidental to transfer of the immovable property. This amendment will take effect from 1st September, 2019. Clause 46 of the Bill seeks to insert new sections 194M relating to payment of certain sums by certain individuals or Hindu undivided family and 194N relating to payment of certain amounts in cash in the Income-tax Act. Sub-section ( 1 ) of the proposed new section 194M seeks to provide for levy of tax deduction at source at the rate of five per cent. on any sum, or aggregate of sums, paid by an individual o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 47 of the Bill seeks to amend section 195 of the Incometax Act relating to other sums. Sub-section ( 2 ) of the said section provides that where the person responsible for paying such sum chargeable under the Act to a non-resident considers that the whole of such sum would not be income chargeable in the case of the recipient, he may make an application to the Assessing Officer to determine, by general or special order, the appropriate proportion of such sum so chargeable, and upon such determination, tax shall be deducted only on that proportion of the sum which is so chargeable. It is proposed to amend the said sub-section so as to empower the Board to prescribe the form and manner of making such application and the manner of determining the appropriate proportion of such sum chargeable. Sub-section ( 7 ) of the said section empowers the Board to specify a class of persons or cases, where the person responsible for paying to a non-resident, not being a company, or to a foreign company, any sum, whether or not chargeable under the provisions of this Act, shall make an application to the Assessing Officer to determine, by general or speci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b-section to specify that in respect of a correction statement delivered by the assessee under the proviso to sub-section ( 3 ) of section 200, no order shall be made under sub-section ( 1 ) deeming a person to be an assessee in default for failure to deduct the whole or any part of the tax from a resident, at any time after the expiry of seven years from the end of the financial year in which payment is made or credit is given, or two years from the end of the financial year in which such correction statement is delivered under the proviso to sub-section ( 3 ) of section 200, whichever is later. These amendments will take effect from 1st September, 2019. Clause 50 of the Bill seeks to substitute section 206A of the Income-tax Act relating furnishing of quarterly return in respect of payment of interest to residents without deduction of tax. Sub-section ( 1 ) of the proposed section provides that any banking company or co-operative society or public company referred to in the proviso to clause ( i ) of sub-section ( 3 ) of section 194A responsible for paying to a resident any income not exceeding forty thousand rupees, where the payer is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rther proposed to amend sub-section ( 2 ) of the said section so as to provide for tax recovery where details of property of assessee in default are not available but the said assessee is a resident in a foreign country. This amendment will take effect from 1st September, 2019. Clause 52 of the Bill seeks to amend section 234A of the Incometax Act relating to interest for defaults in furnishing return of income. The said section 234A, inter alia , provides for charging of interest for defaults in furnishing return of income. It is proposed to insert a new sub-clause ( iia ) in sub-clause ( b ) of sub-section ( 1 ) of said section so as to provide that any relief of tax allowed under section 89 shall also be reduced from the tax on total income for the purpose of charging interest under the said section. These amendments will take effect retrospectively from 1st April, 2007 and will, accordingly, apply in relation to the assessment year 2007-08 and subsequent assessment years. Clause 53 of the Bill seeks to amend section 234B of the Incometax Act relating to interest for defaults in payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under sub-section ( 3 ) of section 92CD. It is proposed to amend the said clause so as to provide that the assessee may appeal to the Commissioner (Appeals) against an order made under sub-section ( 3 ) of section 92CD. This amendment is consequential in nature to the amendment of section 92CD. This amendment will take effect from 1st September, 2019. Clause 57 of the Bill seeks to amend section 269SS of the Income-tax Act relating to mode of taking or accepting certain loans, deposits and specified sum. The said section prohibits a person from taking or accepting from a depositor any loan or deposit or any specified sum equal to twenty thousand rupees or more otherwise than by an account payee cheque or an account payee bank draft or by use of electronic clearing system through a bank account. It is proposed to amend the said section so as to empower the Board to make rules to prescribe any other electronic mode for taking or accepting of certain loans, deposits and any specified sum. This amendment will take effect from 1st September, 2019. Clause 58 of the Bill se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sub-section ( 2 ) of the said section specifies the condition under which a person shall be considered to have under-reported his income. Sub-section ( 3 ) of the said section provides for the manner in which under-reported income shall be determined. It is proposed to amend clause ( b ) and clause ( e ) of the said sub-section ( 2 ) so as to provide that where return is furnished for the first time under section 148, a person shall be considered to have under-reported his income, if the income or deemed income assessed is greater than the maximum amount not chargeable to tax . It is further proposed to amend sub-clause ( b ) of clause ( i ) of the said sub-section ( 3 ) so as to provide that where return is furnished for the first time under section 148 in the case of a company, firm or local authority, the amount of income assessed, and in any other case, the difference between the amount of income assessed and the maximum amount not chargeable to tax shall be the under-reported income. It is also proposed to amend clause ( a ) of sub-section ( 10 ) of section 270A so as to provide that in a case where return is furnishe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on false quoting or non-intimation of Aadhaar number. It is further proposed that penalty of ten thousand rupees shall be levied for each such default. It is also proposed to insert a new sub-section ( 2A ) to provide that if a person, who is required to quote and also authenticate his permanent account number or Aadhaar number, as the case may be, in accordance with the provisions of section ( 6A ), fails to do so, the Assessing Officer may direct that such person shall pay, by way of penalty, a sum of ten thousand rupees for each such default. It is also proposed to insert a new sub-section ( 2B ) to provide that if a person who is required to ensure that the permanent account number or the Aadhaar number, as the case may be, quote in the documents relating to transaction prescribed in clause ( c ) of sub-section ( 5 ) of section 139A or authenticate such number in respect of transactions prescribed under sub-section ( 6A ) of that section, fails to do so, the Assessing Officer may direct that such person shall pay, by way of penalty, a sum of ten thousand rupees for each such default. It is also proposed that before passing a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion so as to provide that if the defect in the statement is not rectified within the time specified therein, the provisions of the Act shall apply as if such person had furnished inaccurate information in the statement. These amendments will take effect from 1st September, 2019. Clause 67 of the Bill seeks to amend section 286 of the Incometax Act relating to furnishing of report in respect of international group. The provisions of the said section, inter alia , provide for specific reporting regime containing revised standards for transfer pricing documentation and a template for country-by-country reporting. Sub-clause ( i ) of clause ( a ) of sub-section ( 9 ) of the said section defines the expression accounting year to mean a previous year, in a case where the parent entity or alternate reporting entity is resident in India. It is proposed to amend the said sub-clause so as to provide that the accounting year in case of an alternate reporting entity, resident in India, whose ultimate parent entity is outside India, shall not mean the previous year but an annual accounting period, with respect to which th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section also specifies circumstances under which benefit of certain items shall be suspended or denied to such person. It also empowers the Board to make regulations for the purposes of the section. Clause 71 of the Bill seeks to substitute sub-section ( 1 ) and to amend sub-section ( 6 ) of section 103 of the Customs Act. The proposed amendment to sub-section ( 1 ) seeks to enable the proper officer to scan or screen with prior approval of Deputy Commissioner of Customs or Assistant Commissioner of Customs any person referred to in sub-section ( 2 ) of section 100 who has any goods liable to confiscation secreted inside his body. The proposed amendment to sub-section ( 6 ) seeks to enable the magistrate to take action upon the report of scanning or screening by the proper officer also. Clause 72 of the Bill seeks to amend sub-sections ( 1 ), ( 4 ) and ( 6 ) of section 104 of the Customs Act. The amendment to sub-section ( 1 ) seeks to empower an officer of customs to arrest a person who has committed an offence outside India or Indian Customs waters. The amendment to sub-section ( 4 ) seeks to insert two new clauses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amend first proviso to section 125 of the Customs Act so as to provide that the no fine in lieu of confiscation shall be imposed in respect of cases of deemed closure under section 28. Clause 78 of the Bill seeks to amend sub-section ( 1 ) of section 135 of the Customs Act so as to insert a new clause ( e ) therein to make obtaining of an instrument by any person from any authority by fraud, collusion, wilful misstatement or suppression of facts, where such instrument has been utilised by such person or any other person a punishable offence. The new clause ( E ) in item ( i ) of sub-section ( 1 ) seeks to make obtaining an instrument from any authority by fraud, collusion, wilful misstatement or suppression of facts, where such instrument has been utilised by any person a punishable offence if the duty relatable to utilisation of the instrument exceeds fifty lakhs of rupees. It is also proposed to insert an Explanation to define the term instrument . Clause 79 of the Bill seeks to amend section 149 of the Customs Act so as to empower Board to make regulations specifying time, form, manner, restrictions and conditio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llate Tribunal against the findings of the designated authority regarding determination of safeguard duty. Clause 87 of the Bill seeks to amend the First Schedule to the Customs Tariff Act,- ( a ) in the manner specified in the Fourth Schedule with a view to revise the tariff rates in respect of certain tariff items and to amend Chapter Note of Chapter 98 so as to exclude printing books from the purview of heading 9804; ( b ) in the manner specified in the Fifth Schedule with a view to rectify errors and harmonise certain entries with Harmonised System of Nomenclature and also to create new tariff lines from certain entries, with effect from such date as the Central Government may, by notification in the Official Gazette, appoint. Clause 88 of the Bill seeks to give retrospective effect to the notification number G.S.R. 186 ( E ), dated the 22nd February, 2016, amending the notification number G.S.R. 804 ( E ), dated the 21st October, 2015, issued under sub-sections ( 1 ) and ( 5 ) of section 9A of the Customs Tariff Act, 1975, so as to retrospectively modify the tariff classification of the goods leviable to anti-dump ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his recipient. Clause 96 of the Bill seeks to amend section 39 of the Central Goods and Services Tax Act so as to provide for furnishing of annual returns and for quarterly payment of tax by taxpayer who opts for composition levy and to provide for certain other category of tax payers, an option for quarterly and monthly payments under the proposed new return filing system. Clause 97 of the Bill seeks to amend section 44 of the Central Goods and Services Tax Act so as to empower the Commissioner to extend the due date for furnishing Annual return and reconciliation statement. Clause 98 of the Bill seeks to amend section 49 of the Central Goods and Services Tax Act so as to provide facility to the taxpayer to transfer an amount from one head to another in the electronic cash ledger. Clause 99 of the Bill seeks to amend section 50 of the Central Goods and Services Tax Act so as to provide for charging interest only on the net cash tax liability, except in those cases where tax is paid subsequent to initiation of any proceedings under section 73 or 74 of the Act. Clause 100 of the Bill seeks ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ify its advance ruling. Clause 106 of the Bill seeks to amend section 103 of the Central Goods and Services Tax Act so as to provide that the advance ruling pronounced by the National Appellate Authority shall be binding on the applicants, being distinct persons and all registered persons having the same Permanent Account Number and on the concerned officers or the jurisdictional officers in respect of the said applicants and the registered persons having the same Permanent Account Number. It also provides that the ruling shall be binding unless there is a change in law or facts. Clause 107 of the Bill seeks to amend section 104 of the Central Goods and Services Tax Act to provide that advance ruling pronounced by the National Appellate Authority shall be void where the ruling has been obtained by fraud or suppression of material facts or misrepresentation of facts. Clause 108 of the Bill seeks to amend section 105 of the Central Goods and Services Tax Act to provide that the National Appellate Authority shall have all the powers of a civil court under the Code of Civil Procedure, 1908 for the purpose of exercising its powers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... November, 2017. Service Tax Clause 116 of the Bill seeks to provide retrospective exemption from service tax on service by way of grant of liquor licence by the State Government, during the period from the 1st day of April, 2016 up to 30th day of June, 2017. Clause 117 of the Bill seeks to provide retrospective exemption from service tax to the long duration degree or diploma programmes except Executive Development Programme provided by the Indian Institutes of Management to the students during the period from the 1st day of July, 2003 up to the 31st day of March, 2016. Clause 118 of the Bill seeks to provide retrospective exemption from service tax on upfront amount paid for services by way of grant of long term lease of plots for development of infrastructure for financial business by the State Government Industrial Development Corporations or Undertakings or by any other entity having fifty per cent. or more ownership of the Central Government or State Government or Union territory, directly or through an entity which is wholly owned by such Governments, to the developers in the industrial or financial bus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Bill seeks to amend section 6 of the Insurance Act, 1938 relating to requirement as to capital. It is proposed to insert a new sub-section ( 3 ) in the said section so as to restrict the foreign company engaging in re-insurance business through a branch in an International Financial Services Centre as specified in sub-section ( 1 ) of section 18 of the Special Economic Zones Act, 2005 for registration unless it has net owned funds of not less than rupees one thousand crore. This amendment will take effect retrospectively from 1st April, 2019. Clauses 144 and 145 of the Bill seek to amend certain provision of the Securities Contracts (Regulation) Act, 1956. It is proposed to amend section 23A of the said Act to provide that in addition to furnish information to recognised stock exchange the said information may also be furnished to the Board. Clauses 146 and 147 of the Bill seek to amend certain provisions of the Banking Companies (Acquisition and Transfer of undertakings) Act, 1970. It is proposed to amend section 9 of the Act to empower the Central Government to appoint not more than five full time directors of corr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal Housing Bank to file winding up petition. Clause 163 of the Bill seeks to amend section 34 of the said Act relating to inspection. Clause 164 of the Bill seeks to amend section 35 of the said Act relating to deposits not to be solicited by unauthorised persons. Clause 165 of the Bill seeks to amend section 35A of the said Act relating to disclosure of information. Clause 166 of the Bill seeks to substitute section 35B of the said Act relating to power of Reserve Bank to exempt housing finance institution. Clause 167 of the Bill seeks to amend section 44 of the said Act relating to obligation as to fidelity and secrecy. Clause 168 of the Bill seeks to amend section 46 of the Act to substitute Reserve Bank for national housing Bank throughout the Act. Clause 169 of the Bill seeks to amend section 49 of the Act to substitute the National Housing Bank or the Reserve Bank for the National Housing Bank . It is further propsed to substitute National Company Law Tribunal for Authorised officer . Clause 170 of the Bill seeks to amend section 51 of the said Act relati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any court from the period of time provided under sub-section ( 5 ) to refer the order passed under sub-section ( 4 ) within fifteen days from the date of attachment to the Adjudicating Authority and that if after exclusion of the period of stay if the remaining period is less than seven days, the remaining period shall be deemed to extend to seven days. Sub-section ( 7 ) of section 26 of the said Act does not provide that in computing the period of one year for passing an order the period during which the proceeding is stayed by an order or injunction of any court shall be excluded. It is proposed to amend the said sub-section so as to provide that in computing the period of one year for passing an order, the period during which the proceeding is stayed by an order or injunction of any court is excluded. It is also proposed that if after exclusion of the period of stay if the remaining period is less than sixty days, the remaining period shall be deemed to extend to sixty days. It is also proposed to insert new sections 54A and 54B in the said Act. Sub-section ( 1 ) of the proposed new section 54A provides that the person shall p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en through any electronic means and not necessarily in writing, may also amount to a penalty under the said section. It is also proposed to amend section 15F of the said Act so as to provide monetary penalty for failure to issue contract notes in the form and in the manner specified by the stock exchange of which a registered stock broker is a member. It is also proposed to insert a new section 15HAA so as to provide monetary penalty for alteration, destruction, mutilation, concealment or falsification of information, record, document (including electronic records), relating to a contravention of this Act, so as to impede, obstruct, or influence the investigation, inquiry, audit, inspection or proper administration of any matter within the juridiction of the Board. It also seeks to protect of electronic database of the Board intermediaries regulated by the Board, under the Act. Clause 182 of the Bill seeks to amend section 10 of the Central Road and Infrastructure Fund Act, 2000 relating to functions of the Central Government. It is proposed to amend clause ( iv ) of subsection ( 1 ) of the said section for formulation of criteria for allocati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is proposed to amend the said sub-section ( 1 ) so as to extend the income-tax exemption to the said undertaking from the period beginning on the 1st April, 2019 to the 31st March, 2021. This amendment will take effect retrospectively from 1st April, 2019. Clauses 187 to 192 of the Bill seek to amend certain provisions of the Prevention of Money-Laundering Act, 2002. It is proposed to amend sub-clause ( i ) of clause ( n ) of sub-section ( I ) of section 2, to meet out the difficulties being faced out by the Securities and Exchange Board of India. It is further proposed to amend sub-clause ( ii ) of clause ( sa ) of sub-section ( I ) of section 2, to meet out the difficulties being faced out by the Financial Intelligence Unit, India. It is also proposed to amend section 12A so as to provide the reference of newly inserted section 12AA therein. It is also proposed to insert a section 12AA of the said Act so as to provide for the provisions for enhance due diligence. It is also proposed to amend section 15 of the said Act so as to provide the reference of newly inserted section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lause 195 of the Bill seeks to amend section 2 of the said Act. The existing provisions of clause ( 2 ) of section 2 of the said Act, inter alia , provides that the assessee means a person who is resident in India within the meaning of section 6 of the Income-tax Act. It is proposed to amend the aforementioned clause so as to provide that the assessee shall mean a person being a resident in India within the meaning of section 6 of the Income-tax Act, in the previous year, or a person being a non-resident or not ordinarily resident in India within the meaning of clause ( 6 ) of section 6 of the Income-tax Act, in the previous year, who was resident in India either in the previous year to which the income referred to in section 4 relates to or in the previous year in which the undisclosed asset located outside India is acquired. It is further proposed to insert a proviso to provide that the previous year of acquisition of the asset shall be determined without giving effect to the provisions of clause ( c ) of section 72. This amendment will take effect retrospectively from 1st July, 2015. Clause 196 of the Bill see ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt on or before such date as may be notified by the Central Government in the Official Gazette, along with the interest on such amount, at the rate of one per cent. for every month or part of a month comprised in the period commencing on the date immediately following the due date and ending on the date of such payment. Section 191 of the said Act, inter alia , provides that any amount of tax, surcharge or penalty paid in pursuance of a declaration made under the Scheme shall not be refundable. It is proposed to insert a proviso in the said section to provide that the Central Government may, by notification in the Official Gazette, specify the class of persons to whom the amount of tax, surcharge and penalty, paid in excess of the amount payable under the Scheme shall be refundable. This amendment will take effect retrospectively from 1st June, 2016. Clause 201 of the Bill seeks to amend the Sixth Schedule to the Finance Act, 2018, so as to increase the rate of road and infrastructure cess on motor spirit commonly known as petrol and high speed diesel oil , from rupees 8 per litre to rupees 10 per litre. Clause 202 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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