Income-tax (Second Amendment) Rules, 2008 - Amendment in rule 40C; insertion of rule 40D

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..... ion ( i ) to clause ( ba ) of sub-section (1) of section 115WC of the Income-tax Act, 1961 (43 of 1961) , read with section 22 of the General Clauses Act, 1897 (10 of 1897), 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 (Second Amendment) Rules, 2008. (2) They Shall .....

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..... ause ( e ) respectively of sub-rule (4) of rule 40C." [F. No. 142/25/2007-TPL] EXPLANATORY MEMORANDUM The Finance Act, 2007 amended the provisions of the Income-tax Act to provide that employers will be liable to pay fringe benefit tax on the value of ESOPs granted to employees as and when the specified security or sweat equity share were allotted or transferred to the employees. The value .....

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..... the Income-tax Act without a definition, thereby allowing it to take its natural meaning. Further, a new rule 40D has been inserted in the Income-tax Rules for the purposes of valuation of specified security not being an equity share in the company. The amended rule 40C and the new rule 40D will take effect from the 1st April, 2008 and will, accordingly, apply in relation to the assessment year .....

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