Clause 37 - Amendment of section 115R. - Finance (No. 2) Bill, 2019

Amendment of section 115R. 37. In section 115R of the Income-tax Act, in sub-section (2), with effect from the 1st day of September, 2019,- (A) after the second proviso, before the Explanation, the following proviso shall be inserted, namely:- Provided also that no additional income-tax shall be chargeable in respect of any amount of income distributed on or after the 1st day of September, 2019 by a specified Mutual Fund, out of its income derived from transactions made on a recognised stock exchange located in any International Financial Services Centre: ; (B) in the Explanation,- (a) after clause (i), the following clause shall be inserted, namely: (ia) convertible foreign exchange means foreign exchange which is for the time being treated by the Reserve Bank of India as convertible foreign exchange for the purposes of the Foreign Exchange Management Act, 1999(42 of 1999.) and the rules made thereunder; ; (b) after clause (ii), the following clauses shall be inserted, namely: (iii) International Financial Services Centre shall have the meaning assigned to it in clause (q) of section 2 of the Special Economic Zones Act, 2005;(28 of 2005.) (iv) recognised stock exchange shall have the meaning assigned to it in clause (ii) of Explanation 1 to clause (5) of section 43; (v) specified Mutual Fund means a Mutual Fund specified under clause (23D) of section 10- (a) located in any International Financial Services Centre; (b) deriving income solely in convertible foreign exchange; (c) of which all the units are held by non-residents; (vi) unit means beneficial interest of an investor in the fund; . Note: While Passing the bill in the Loksabha as on 18-7-2019, the following amendments were made: Clause 37 Amendments made: Page 15, for line 36, substitute International Financial Services Centre and where the consideration for such transaction is paid or payable in convertible foreign exchange: , . (14) Page 15, omit line 50. (15) Page 16, line 1, for (c) , substitute (b) . (16) Thus, the amended provision will be: 37. In section 115R of the Income-tax Act, in sub-section (2), with effect from the 1st day of September, 2019,- (A) after the second proviso, before the Explanation, the following proviso shall be inserted, namely:- Provided also that no additional income-tax shall be chargeable in respect of any amount of income distributed on or after the 1st day of September, 2019 by a specified Mutual Fund, out of its income derived from transactions made on a recognised stock exchange located in any International Financial Services Centre and where the consideration for such transaction is paid or payable in convertible foreign exchange : ; (B) in the Explanation,- (a) after clause (i), the following clause shall be inserted, namely: (ia) convertible foreign exchange means foreign exchange which is for the time being treated by the Reserve Bank of India as convertible foreign exchange for the purposes of the Foreign Exchange Management Act, 1999(42 of 1999.) and the rules made thereunder; ; (b) after clause (ii), the following clauses shall be inserted, namely: (iii) International Financial Services Centre shall have the meaning assigned to it in clause (q) of section 2 of the Special Economic Zones Act, 2005;(28 of 2005.) (iv) recognised stock exchange shall have the meaning assigned to it in clause (ii) of Explanation 1 to clause (5) of section 43; (v) specified Mutual Fund means a Mutual Fund specified under clause (23D) of section 10- (a) located in any International Financial Services Centre; (b) x x x x x x x x x (c) (b) of which all the units are held by non-residents; (vi) unit means beneficial interest of an investor in the fund; .