Additional credit of 10% of the gift-tax paid u/s 18 of the Gift -Tax Act. - Income Tax - 1062/CBDT

INSTRUCTION NO. 1062/CBDT Dated : May 28, 1977 Section(s) Referred: 18 ,18A Statute: Gift Tax Act, 1958 Attention is invited to instruction No.1039 (F.No.340/2/74-GT), dated 21-2-77 on the subject mentioned above. 2. In the extract of the Law Ministry's advice as well as in the example accompanying the said Instruction, there is a reference to additional credit at the rate of 10% of the gift-tax paid under section 18 of the Gift -Tax Act. It is clarified that this is with reference to the legal position as it obtained prior to the amendment of section 18 by the Taxation Laws (Amendment) Act, 1975. Under section 18 as amended by the Taxation Laws (Amendment) Act, 1975, with effect from 1.4.75, the assessee is to be given additional credit for a sum equal to one-ninth of the gift-tax paid (instead of one-tenth allowed prior to the said amendment) subject to the condition that such sum shall in no case exceed 1/10th of the tax due on the gift.