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TMI BlogDefinitionsX X X X Extracts X X X X X X X X Extracts X X X X ..... or upto the date of liquidation, as the case may be, in any other case; 5. "actual cost" in relation to a business capital asset shall be the cost computed under section 42; 6. "advance-tax" means the advance income-tax payable in accordance with the provisions of section 204; and 7. "advance ruling" shall have the meaning assigned to it in section 249; 8. "agreement" includes any arrangement or understanding or action in concert, whether or not such arrangement, understanding or action, is- (a) in writing; (b) formal; or (c) intended to be enforceable by legal proceedings; 9. "agreement of association" means,- (a) a partnership deed in relation to a firm; or (b) an oral, or written, agreement between the participants of any other unincorporated body; 10. "agreement for non-compete" means an agreement for,- (a) not carrying out any activity in relation to any business; or (b) not sharing any,- (i) know-how, patent, copyright, trade-mark, license, franchise or any other business or commercial right of similar nature; or (ii) information or technique likely to assist in the trading or manufacture or processing of goods or provision for services; 11. "agricultural income" means the fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ive; or (c) an unincorporated body or a proprietory concern means the succession of an amalgamating unincorporated body or proprietory concern with an amalgamated company if,- (i) all the assets and liabilities of the body or concern relating to the business immediately before the succession become the assets and liabilities of the amalgamated company; (ii) the participants of the body or the proprietor of the concern do not receive any consideration or benefit, directly or indirectly, in any form or manner, other than by way of allotment of shares in the amalgamated company; (iii) the aggregate of the shareholding in the amalgamated company of the participants of the body or the proprietor of the concern, upon succession, is not less than fifty per cent of the total value of the shares in the company; and (iv) in the case of an amalgamating unincorporated body, all the participants immediately before the succession become the shareholders of the company in the same proportion in which their capital accounts stood in the books of the body on the date of the succession; 17. "Appellate Tribunal" means the Appellate Tribunal constituted under section 187; 18. "approved fund" means - ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... take apparent from the record; (d) any order giving effect to the directions of an Appellate Authority; and (e) any order under section 194; 27. "asset" means (a) a business asset;or (b) an investment asset; 28. "Assistant Commissioner" means a person appointed to be an Assistant Commissioner of Income-tax under section 130; 29. "associated concern" shall have the meaning assigned to it in section 96; 30. "Assistant Director" means a person appointed to be an Assistant Director of Income-tax under section 130; 31. "associated enterprise" shall have the meaning assigned to it in section 113; 32. "associated operation" shall have the meaning assigned to it in section 113; 33. "associated person" shall have the meaning assigned to it in section 113; 34. "Board" means the Central Board of Direct Taxes constituted under the Central Boards of Revenue Act, 1963 and notified by the Central Government for the purposes of this Code; 35. "backward classes" means such classes of citizens, other than the Scheduled Castes and the Scheduled Tribes, as may be notified, from time to time, by the Central Government or any State Government; 36. "banking company" means a company to which the Banking R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... abitually secures orders in India, mainly or wholly for the non-resident or for that non-resident and its associated enterprise, and 44. "business reorganisation" means reorganisation of business of two or more residents, involving - (a) an amalgamation; (b) a merger under a scheme sanctioned and brought into force by the Central Government under the Banking Regulation Act, 1949; or (c) a demerger; 45. "business trading asset" means stock-in-trade, consumable stores or raw materials held for the purposes of business; 46. "capital asset" means property of any kind held by an assessee other than business trading asset; 47. "capital employed in the business" in relation to actual cost means the aggregate of the paid-up share capital, debentures and long-term borrowings - (a) in a case where the prescribed expenditure is incurred before the commencement of the business, as on the last day of the financial year in which the business of the company commences; (b) in any other case as on the last day of the financial year in which the extension of the business is completed, or the new business commences production or operation, in so far as such capital, debentures and long-term borrowing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thority" means any income-tax authority prescribed as such; 62. "Comptroller and Auditor-General of India" means the Comptroller and Auditor General of India appointed under Article 148 of the Constitution of India; 63. "computer software" means- (a) any computer programme recorded on any disc, tape, perforated media or other information storage device; or (b) any customized electronic data or any product or service of similar nature, as may be notified by the Board; 64. "Controller of Insurance" shall have the meaning assigned to it in clause (5B) of section 2 of the Insurance Act, 1938; 65. "converted property" means - (a) any property having been the separate property of an individual has been converted by the individual into property belonging to the family through the act of impressing such separate property with the character of property belonging to the family or throwing it into the common stock of the family; or (b) any property which has been transferred by the individual, directly or indirectly, to the family otherwise than for adequate consideration; 66. "co-operative bank" shall have the meanings assigned to it in Part V of the Banking Regulation Act, 1949; 67. "co-ope ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... anufacture, production or processing of the goods begins after successful trial run of the plant; or (b) in any other case, the date on which it is ready to commence its commercial operations; 76. "debt" includes a loan or borrowing; 77. "debt instrument" means a paper or electronic obligation that enables the borrower to raise funds by promising to repay the lender, or investor, in accordance with the terms of a contract and includes note, bond, certificate, mortgage, lease, loan, borrowing or other agreement between the borrower and the lender; 78. "deduction of tax at source" or "collection of tax at source" with all their grammatical variations, mean deduction or collection of tax under Chapter XI; 79. "deductor" means a person responsible for making any payment in respect of which he is liable to deduct tax at source under sub-chapter A of Chapter-XI; 80. "demerged company" means - (a) the company whose undertaking is transferred, pursuant to a demerger, to a resulting company; or (b) the authority or the body constituted or established under a Central, State or Provincial Act, or a local authority or a public sector company, which is split up or reconstructed, to form a resul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ectively assigned to them in the Companies Act, 1956; 88. "Dispute Resolution Panel" means a collegium comprising of three Commissioners of Income-tax constituted by the Board for this purpose; 89. "dividend" distributed or paid by a company,- (a) shall include the following, namely:- (i) any distribution by a company of accumulated profits, whether capitalised or not, if such distribution entails the release by the company to its shareholders of all or any part of the assets of the company; (ii) any distribution to its shareholders by a company of debentures, debenture-stock, or deposit certificates in any form, whether with or without interest, and any distribution to shareholders of its preference shares by way of bonus, to the extent to which the company possesses accumulated profits, whether capitalised or not; (iii) any distribution made to the shareholders (other than shareholders not entitled in the event of liquidation to participate in the surplus assets) of a company on its liquidation, to the extent to which the distribution is attributable to the accumulated profits of the company immediately before its liquidation, whether capitalised or not; (iv) any distribution to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s; or (ii) the 31st August following the financial year, in all other cases; or (b) in relation to any other return, the date as may be prescribed for such return; 95. "electoral trust" means a trust so approved by the Board in accordance with rules made in this regard by the Central Government. 96. "employer" means an entity which controls and directs an individual under an express or implied contract of employment and is obligated to pay compensation to him; 97. "equity oriented" in relation to a scheme means the scheme - (a) of a Mutual Fund registered under the Securities and Exchange Board of India Act, 1992 or regulations made thereunder; and (b) which invests sixty-five per cent or more of its investible funds in the form of equity shares in domestic companies, computed with reference to the annual average of the monthly averages of the opening and closing figures; 98. "equity shares" means equity shares within the meaning of section 85 of the Companies Act, 1956; 99. "execution of an authorisation for search or requisition", with all its grammatical variations- an authorisation for search, or requisition, shall be deemed to have been executed,- (a) in the case of a search, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion of services of technical or other personnel; or (iii) development and transfer of a design, drawing, plan or software, or any other service of similar nature; and (b) does not include consideration for any construction, assembly, mining or like project undertaken by the recipient or consideration which would be income of the recipient chargeable under the head "Income from employment"; 106. "finance charges" means - (a) any interest; or (b) any incidental financial charges; 107."financial intermediary" means stock broker or sub-broker or such other intermediary registered under section 12 of the Securities and Exchange Board of India Act, 1992 or the Depositories Act, 1996; 108."financial lease" and its grammatical variation, means a lease transaction where- (a) contract for lease is entered into between two parties for leasing of a specific asset; (b) such contract is for use and occupation of the asset by the lessee; (c) the lease payment is calculated so as to cover the full cost of the asset together with the interest charges; and (d) the lessee is entitled to own, or has the option to own, the asset at the end of the lease period after making the lease payment; 109."finan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of a financial year means the net result of the aggregation under sub-section (3) or sub-section (4) of section 58, for that financial year. 118. "gross total income from the special source" of a financial year means the net result of the aggregation under sub-section (2) or sub-section (3) of section 59, for that special source for that financial year. 119. "head office expenditure" means executive and general administration expenditure incurred by the assessee outside India, including expenditure incurred in respect of- (a) rent, rates, taxes, repairs or insurance of any premises outside India used for the purposes of the business or profession; (b) salary, wages, annuity, pension, fees, bonus, commission, gratuity, perquisites or profits in lieu of or in addition to salary, whether paid or allowed to any employee or other person employed in, or managing the affairs of, any office outside India; (c) traveling by any employee or other person employed in, or managing the affairs of, any office outside India; and (d) such other matters connected with executive and general administration as may be prescribed; 120. "heavy goods vehicle" shall have the meaning assigned to it in section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns the profits of the business as computed under section 30; 130. "income under the head 'capital gains' " means the income as computed under sub-sections (4) or (5) of section 47; 131. "income under the head 'income from business' " means the income in respect of that head, as computed under sub-section (1) of section 58; ' 132. "income from employment" means the income as computed under sections 20; 133. "income under the head 'income from employment' " means the income in respect of that head, as computed under sub-section (1) of section 58; 134. "income from house property" means the income as computed under section 24; 135. "income under the head 'income from house property' " means the income in respect of that head, as computed under sub-section (1) of section 58; 136. " income from residuary sources" means the income as computed under section 55; 137. "income under the head 'income from residuary sources' " means the income in respect of the head, as computed under sub-section (1) of section 58; 138. "income-tax" in relation to ,- (a) India, means the income-tax payable under section 2; and (b) any foreign country, includes any excess profits tax or business profits tax cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... granted a certificate of registration under section 3 of that Act; 149. "interest" means any amount payable to any person (including any participant), in any manner, in respect of any borrowing or debt incurred or any other similar right or obligation; 150. "interested person" shall have the same meaning assigned to it in section 96; 151. "investment asset" means any capital asset which is not a business capital asset; 152. "jewellery" in relation to a capital asset, includes - (a) ornaments made of gold, silver, platinum or any other precious metal or any alloy containing one or more of such previous metals, whether or not containing any precious or semi-precious stone, and whether or not worked or sewn into any wearing apparel; (b) precious or semi-precious stones, whether or not set in any furniture, utensil or other article or worked or sewn into any wearing apparel; 153. "Joint Commissioner" means a person appointed to be a Joint Commissioner of Income-tax, an Additional Commissioner of Income-tax, a Joint Director of Income-tax or an Additional Director of Income-tax under section 130; 154. "Joint Director" means a person appointed to be a Joint Director of Income-tax or an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eriod of not less than five years, or (b) moneys borrowed or debt incurred in a foreign country for the purchase of capital plant and machinery outside India, where the terms of the borrowings provide for the repayment during a period of not less than seven years; 164. "long-term finance" means any loan or advance where the terms under which moneys are loaned or advanced provide for repayment along with interest thereof during a period of not less than five years; 165. "long term leasing" means,- (a) lease for a term of not less than twelve years; or (b) a lease which provides for the extension of the term 'thereof' by a further term or terms, if the aggregate of the term for which such lease is to be granted and the further term or terms for which it can so extended is not less than twelve years; 166. "lottery" includes winnings from prizes awarded to any person by draw of lots or by chance or in any other manner whatsoever, under any scheme or arrangement by whatever name called; 167. "manufacture", with its grammatical variations, means a change in a non-living physical object or article or thing,- (a) resulting in transformation of the object or article or thing into a new and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ust" means the New Pension System Trust established on the 27th day of February, 2008 under the provisions of the Indian Trusts Act, 1882; 181. "non-filer" in relation to a financial year means a person,- (a) who has not furnished,- (i) a return of tax bases for the financial year; and (ii) a return of tax bases for two immediately preceding financial years; and (b) who has not been issued any notice under section 151 in respect of the relevant financial year and two immediately preceding financial years; 182. "non-profit organisation" shall have the same meaning assigned to it in section 96; 183. "non-resident" means a person who is not a resident; 184. "non-resident deductee" means a person who is non-resident in India and receives any amount which is liable to deduction of tax at source under Chapter XI; 185. "notice" means the legal instrumentality by which intimation is provided; 186. "option" in relation to sweat equity shares means a right but not an obligation, granted to an employee to apply for the sweat equity shares at a predetermined price; 187. "original investment asset" means an investment asset in respect of which deduction under section 53 is claimed; 188. "Overse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o a person under this Code for the purposes of identification of that person; 198. "permanent establishment" in relation to a non-resident includes a fixed place of business through which the business of the enterprise is wholly or partly carried on; 199. "permitted derivative transaction" means any transaction in derivatives, if- (a) it is carried out electronically on screen-based systems of a recognised stock exchange; (b) it is carried out by a bank or mutual fund or any other person, through a financial intermediary; and (c) it is supported by a time stamped contract note issued by the financial intermediary to every client indicating in the contract note - (i) the unique client identity number allotted under any relevant Act; and (ii) the permanent account number allotted under this Code; 200. "permitted financial institution" means,- (a) a banking company or a scheduled bank; (b) a non-banking financial company; (c) a public financial institution; (d) State financial corporations; (e) State industrial investment corporations; or (f) a housing-finance development company; 201. "permitted savings intermediaries" means,- (a) approved provident fund; (b) approved superannuation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n and Multiple Disabilities Act, 1999. 209. "personal effect" in relation to a capital asset means any movable property (including wearing apparel and furniture) held for personal use by the assessee or any member of his family dependant on him, but excludes,- (a) jewellery; (b) archaeological collections; (c) drawings; (d) paintings; (e) sculptures; and (f) any work of art; 210. "perquisite" means the following amenity, facility, privilege or service, whether convertible into money or not, provided directly or indirectly to the assessee by his employer, whether by way of reimbursement or otherwise:- (a) the value of any accommodation computed in the prescribed manner; (b) any sum payable to effect an assurance on life or to effect a contract for an annuity; (c) any sum payable to any permitted savings intermediaries; (d) the value of any sweat equity share allotted or transferred, as on the date on which the option is exercised by the assessee; (e) the value of any obligation which, but for payment by the employer, would have been payable by the assessee, computed in the prescribed manner; and (f) the value of any other amenity, facility, privilege or service, computed in the pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r employer at or in connection with his voluntary retirement or the termination of his employment or the modification of the terms and conditions relating thereto; (b) any sum received under a Keyman insurance policy including the sum allocated by way of bonus on such policy, if any part of the contribution to the policy is made by his employer or former employer; and (c) any amount due to or received, directly or indirectly, by any assessee from any person- (i) before his joining any employment with that person; or (ii) after cessation of his employment with that person; 221. "public company" shall have the meaning assigned to it in section 3 of the Companies Act, 1956; 222. "public financial institution" shall have the meaning assigned to it in section 4A of the Companies Act, 1956; 223. "public sector bank" means - (a) the State Bank of India constituted under the State Bank of India Act, 1955, (b) a subsidiary bank as defined in the State Bank of India (Subsidiary Banks) Act, 1959, (c) a corresponding new Bank constituted under section 3 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970, or (d) a corresponding new Bank constituted under section 3 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the individual; (f) any lineal ascendant or descendant of the spouse of the individual; (h) spouse of the person referred to in sub-clauses (b) to (f); or (g) any lineal descendant of a brother or sister of either the individual or of the spouse of the individual; 234. "remission or cessation of any liability" shall include the remission or cessation of any liability,- (a) by a unilateral act by the assessee by way of writing off such liability in his account or creating a reserve(by whatever name called); or (b) by virtue of there being no transaction with the creditor during the period of three years from the end of the financial year in which the last transaction took place; 235. "rent" in relation to a house property means any income derived, directly or indirectly, from letting of the property; 236. "Reserve Bank of India" means the Bank constituted under sub-section (1) of section 3 of the Reserve Bank of India Act, 1934; 237. "resident" means a person who is resident in India within the meaning of section 4; 238. "resident deductee" means a person who is resident and receives any amount liable to deduction of tax at source under Chapter XI; 239. "resulting company" means - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... advance or arrear of salary; (h) any allowance granted to the employee to- (i) meet his personal expenses at the place where the duties of his office or employment of profit are ordinarily performed by him or at a place where he ordinarily resides; or (ii) compensate him for the increased cost of living; (i) any allowance or benefit, granted to the employee to meet expenses wholly, necessarily and exclusively for the performance of the duties of an office or employment of profit; (j) any allowance in the nature of personal allowance granted to remunerate or compensate the assessee for performing duties of a special nature relating to his office or employment; (k) any amount receivable, directly or indirectly, by an employee from his employer, in connection with his voluntary retirement or termination of service or voluntary separation; (l) any payment received by an employee in respect of any period of leave not availed by him; (m) the contribution made by the employer in the financial year, to the account of an employee maintained with the permitted savings intermediaries referred to in sub-section (2) of section 66; (n) any contribution by the employer to any fund other than an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ices in connection with business of any industrial or commercial nature such as accounting, banking, merchant banking, communication, conveying of news or information, advertising, entertainment, amusement, education, financing, insurance, chit funds, real estate, construction, transport, storage, processing, supply of electrical or other energy, boarding and lodging; 253. "Sikkimese" means,- (a) an individual, whose name is recorded in the register maintained under the Sikkim Subjects Regulation, 1961 read with the Sikkim Subject Rules, 1961 (herein after referred to as the "Register of Sikkim Subjects"), immediately before the 26th day of April, 1975; (b) an individual, whose name is included in the Register of Sikkim Subjects by virtue of the Government of India Order No.26030/36/90-I.C.I., dated the 7th August, 1990 and Order of even number dated the 8th April, 1991; or (c) any other individual, whose name does not appear in the Register of Sikkim Subjects, but it is established beyond doubt that the name of such individual's father or husband or paternal grandfather or brother from the same father has been recorded in that register; 254. "slump sale" means the sale of any unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the actual delivery or transfer of the commodity or scrips other than the following transactions: (a) a permitted derivative transaction; (b) a contract in respect of raw materials or merchandise entered into by a person in the course of his manufacturing or merchandising business to guard against loss through future price fluctuations in respect of his contracts for actual delivery of goods manufactured by him or merchandise sold by him; (c) a contract in respect of stocks and shares entered into by a dealer or investor therein to guard against loss in his holdings of stocks and shares through price fluctuations; and (d) a contract entered into by a member of a forward market or a stock exchange in the course of any transaction in the nature of jobbing or arbitrage to guard against loss which may arise in the ordinary course of his business as such member; 263. "speed boat" means a motor boat driven by a high speed internal combustion engine capable of propelling the boat at a speed exceeding 24 kilometers per hour in still water and so designed that when running at such speed, it will plane, i.e., its bow will rise; 264. "stamp duty value" means,- (a) the value adopted, or as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a discount or for consideration other than cash; 274. "tax" means - (a) any tax chargeable under the provisions of this Code; (b) surcharge chargeable under the relevant Finance Act; or (c) cess chargeable under the relevant Finance Act; 275. "tax bases" means- (a) income or total income, as the case may be, in relation to income-tax; (b) net wealth in relation to wealth-tax; (c) dividend distributed in relation to dividend distribution tax; and (d) the income or total income, net wealth, or dividend distributed referred to in sub-clauses (a) to (c) of any other person in respect of which the assessee is assessable under this Code; 276. "tax account number" means a number allotted under this Code to a person who is liable to deduct tax at source or collect tax at source under sub-chapter-A or sub-chapter-B of Chapter XI; 277. "tax arrear" means any amount of tax, interest or any other sum, due from an assessee under this Code; 278. "Tax Recovery Officer" means any Income-tax Officer who may be authorised by the Chief Commissioner or Commissioner, by general or special order in writing,- (a) to exercise the powers of a Tax Recovery Officer; and (b) to exercise or perform such power ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shares or other specified securities by the issuer of such shares or securities; (f) any contribution of the asset, whether by way of capital or otherwise, to a company or an unincorporated body, in which the transferor is, or becomes, a shareholder or participant, as the case may be; (g) the distribution of the asset on account of dissolution of an unincorporated body; (h) the distribution of the asset on account of liquidation or dissolution of a company; (i) any agreement allowing the possession of an immovable property, to be taken or retained in part performance of a contract of the nature referred to in section 53A of the Transfer of Property Act, 1882; (j) any agreement which enables the enjoyment of the asset, being any immovable property, whether by way of becoming a participant in an unincorporated body or acquiring shares in a company or by way of any agreement, arrangement or in any other manner; (k) the maturity or redemption of a zero coupon bond; (l) slump sale; (m) any damage to the insured asset or its destruction as a result of - (i) flood, typhoon, hurricane, cyclone, earthquake or any other convulsion of nature; (ii) riot or civil disturbance; (iii) accidental f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng year loss from the special source" means the unabsorbed current loss from the special source, of the financial year immediately preceeding the relevant financial year; 297. "undertaking" in relation to demerger shall include - (a) any part of an undertaking, (b) a unit or division of an undertaking, (c) a business activity taken as a whole, or (d) individual assets or liabilities or any combination thereof which constitutes a business activity; 298. "unincorporated body" means - (a) a firm; (b) an association of persons; or (c) a body of individuals; 299. "unit" means a unit of a mutual fund or UTI; 300. "Unit Trust of India" means the Unit Trust of India established under the Unit Trust of India Act, 1963; 301. "university" means a university established or incorporated by or under a Central, State or Provincial Act and an institution declared to be a University under section 3 of the University Grants Commission Act, 1956; 302. "urban area" means - (a) an area within the jurisdiction of a municipality (whether known as a municipality, municipal corporation, notified area committee, town area committee, town committee or by any other name) or a cantonment board and which has a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ribed in this behalf; 311. "venture capital fund" means such fund- (a) which has been granted a certificate of registration as a venture capital fund under the Securities and Exchange Board of India Act, 1992; and (b) which fulfils all other conditions as may be prescribed in this behalf; 312. "wealth-tax" means wealth-tax leviable under Chapter VIII or any tax of a similar character chargeable under any law in force in any country outside India or any tax chargeable under such law with reference to the value of the assets of, or the capital employed in, a business carried on by the assessee, whether or not the debts of the business are allowed as a deduction in computing the amount with reference to which such tax is charged, but does not include any tax chargeable with reference to the value of any particular asset of the business; 313. "widely held company" means - (a) a company owned by the Government or the Reserve Bank of India; (b) a company in which not less than forty per cent of the paid-up share capital is held (whether singly or taken together) by the Government or the Reserve Bank of India or a corporation owned by that bank; (c) a company registered under section 25 o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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