Section 44B & 172 - Special provision for computing profits and gains of shipping business in case of non-residents - Income Tax - Ready Reckoner - Income Tax

Section 44B : Special provision for computing profits and gains of shipping business in case of non-residents Applicable to Non-resident in shipping operations business Income deemed as PGBP 7.5% of: i. Freight received in India or outside India for carriage of goods etc. shipped at port in India . ii. Freight received or deemed to be received in India for carriage of goods etc. shipped at port outside India. Income lower than presumptive rate Assessee cannot show. Recovery Mechanism Recovery mechanism in Section 172 for amount received in India or outside India for carriage of goods etc. shipped at any port in India. Provisions of Section 28 to 43A Not applicable Set-off of current year depreciation and b/f depreciation of other business against such income. Not Possible Set-off of current year losses and b/f losses of other business against such income. Possible Chapter VI-A deduction Available SECTION 172: SHIPPING BUSINESS OF NON-RESIDENT Where a ship carries passengers, livestock, mail or goods shipped at a port in India, 7.5% of the amount paid or payable on account of such carriage to the owner or the charterer or any other person on his behalf, whether that sum is payable in India or outside India, shall be deemed to be the income arising to the owner/ charterer. AMOUNT PAID OR PAYABLE SHALL INCLUDE AMOUNT PAID OR PAYABLE BY WAY OF DEMURRAGE OR HANDLING CHARGES OR ANY OTHER AMOUNT OF SIMILAR NATURE. Before departure from any port in India of any such ship, the MASTER of the ship shall prepare and furnish to the Assessing Officer a return of full amount paid/ payable to the owner/ charterer or any person on his behalf. On receipt of a return, the Assessing Officer shall assess the income and determine the sum payable as tax thereon. The rate of tax shall be as applicable to a foreign company. No order assessing the income and determining the sum of tax payable thereon shall be made under this section after the expiry of nine months from the end of the financial year in which the return under Point No. 2 is furnished. A port clearance certificate shall not be granted to the ship until the collector of Customs is satisfied that the tax assessable under this section has been duly paid or satisfactory arrangements have been made. Comparison of 44B 172 Read more at: https://www.caclubindia.com/forum/section-44b-172-a-comparison-200837.asp Comparison of 44B 172 Read more at: https://www.caclubindia.com/forum/section-44b-172-a-comparison-200837.asp Comparison of 44B 172 Read more at: https://www.caclubindia.com/forum/section-44b-172-a-comparison-200837.asp Comparison of 44B 172 Read more at: https://www.caclubindia.com/forum/section-44b-172-a-comparison-200837.asp Comparison of 44B 172 Read more at: https://www.caclubindia.com/forum/section-44b-172-a-comparison-200837.asp COMPARISON OF SECTION 44B AND SECTION 172 U/s 44B, assessee is under control of Indian Government (i.e., taxation department), whereas u/s 172 assessee is not under control. U/s 44B, assessee has regular business activities in India, whereas u/s 172 assessee has irregular business activities in India. Section 44B, normal assessing of income charging section, whereas section 172 is for advance recovery of tax, however assessee may opt for 44B if he feel that 44B is more beneficial to him. Assessee has regular business activities in India Read more at: https://www.caclubindia.com/forum/section-44b-172-a-comparison-200837.asp