Income-tax (Thirty-first Amendment) Rules, 1999 - S.O. 1150(E) - Income Tax

MINISTRY OF FINANCE (Department of Revenue) (Central Board of Direct Taxes) NOTIFICATION No. 11134 New Delhi, the 19th November, 1999 INCOME-TAX S.O. 1150(E). -In exercise of the powers conferred by section 295 of the Income-tax Act, 1961 (43 of 1961) , the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely :- 1. (1) These rules may be called the Income-tax (Thirty-first Amendment) Rules, 1999. (2) They shall be deemed to have come into force on the 1 st day of April, 1997. 2. In the Income-tax Rules, 1962 , in rule 6DD , for the words ten thousand , wherever they occur, the words twenty thousand shall be substituted. [F. No. 42/45/99-TPL] S. BALASUBRAMANIAN, Under Secy. Foot Note. -The Principal rules were published vide Notification vide S.O. No. 969(E) dated 26-3-1962 and last amended by notification published under S.O. No. 1012 dated 06-10-1999. Explanatory Memorandum. -Section 40A(3) of the Income-tax Act, 1961 was amended by the Finance (No. 2) Act, 1996 enhancing the upper limit for payment of any expenditure incurred otherwise than by a crossed cheque drawn on a bank or by a crossed bank draft to rupees twenty thousand. Twenty per cent of any expenditure, exceeding rupees twenty thousand, made otherwise than by a crossed cheque or a draft is not to be allowed as deduction. Rule 6DD of the Income-tax Rules, 1962 prescribes the cases and circumstances in which payments in a sum exceeding the limit fixed under section 40 A(3), may be made otherwise than by a crossed cheque drawn on a bank or a crossed bank draft. However, the limit of rupees twenty thousand has not been incorporated in the said rule. The limit, as per the rule continued to be rupees ten thousand. It is therefore proposed to amend rule 6DD with effect from the 1st day of April, 1997 so as to remove this anomaly. It is certified that the retrospective effect to the proposed amendment to the said rule 6DD shall not prejudicially affect the interest of any assessee.