Income-tax (15th Amendment) Rules, 2002 - 173/2002 - Income Tax

Income-tax (15th Amendment) Rules, 2002 NOTIFICATION NO. 173 Dated 16th July. 2002 In exercise of powers conferred by Section 295 read with clause (12) and clause (25) of Section 10 of the Income-tax Act, 1961 (43 of 1961) and in supersession of the Income-tax (4th Amendment) Rules, 2002, except as respects things done or omitted to be done before such supersession, 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 (15th Amendment) Rules, 2002. (2) They shall be deemed to have come into force on the 23rd day of October, 2000. 2. In the Income-tax Rules, 1962, (i) in Rule 89,- (a) in sub-rule (i), after the words, figures and brackets "under the Life Insurance Corporation Act, 1956 (31 of 1956)", insert the words, brackets, figures and letters "or any other insurer as defined in clause (28BB) of Section 2 of the Income Tax Act, 1961'; (b) in sub-rule (ii), after the words, "Life Insurance Corporation of India ", insert the words "or any other insurer"; (ii) in rule 101, after the words, figures and brackets "under the Life Insurance Corporation Act, 1956 (31 of 1956)", insert words, brackets, figures and letters "or any other insurer as defined in clause (28BB) of Section 2 of the Income-tax Act, 1961'. Sd/- (Sebastian James) Under Secy. (Tax Policy and Legislation) F.No.l42/22/2001-TPL Note: The principal rules were published under Notification No.S.0.969 dated 26-3-1962 which has been amended from time to time, Uie last such amendment was made vide Notification No.331 (E) dated the 22st of March, 2002. EXPLANATORY MEMORANDUM Prior to the 1-4-2002 , under Rule 89 of the Income-tax Rules, 1962, the trustees of Approved Super Annuation Funds, were required to enter into a scheme of insurance with the Life Insurance Corporation for the purpose of providing annuities for their beneficiaries. Further, the trustees had to accumulate the contributions in respect of each beneficiary and purchase an annuity from the Life Insurance Corporation of India at the time of retirement or death of each employee or on his becoming incapacitated prior to retirement. Under Rule 101, the monies contributed to the approved gratuity fund after the 31st of October, 1974 or received or accruing after that date by way of interest or otherwise to the fund had to be deposited in: (i) Post office saving bank account. (ii) Current account or saving account with any scheduled bank or, (iii) Utilised for making contributions under the group gratuity scheme entered into with the Life Insurance Corporation. To the extent that such monies are not deposited or utilized, it has to be invested in Central Government securities, 2. Rules 89 and 101 of the Income-tax, Rules, 1962 was amended vide Notification No.S.0.331(E) dated 22nd of March, 2002, to provide that insurers, approved by the IRDA, are at par with LIC with regard to investment of pension funds under Rule 89 and Rule 101. This Notification was effective from the 1st of April, 2002 . 3. As IRDA has been registering the approved private insurance companies under the IRDA Act from the 23rd of October, 2000 . the amendment is now being made effective from that date- 4. It is certified that the above-mentioned amendment to the said Rules 89 and Rule 101 of the Income-tax Rules shall not prejudicially affect the interest of any assessee.