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TMI BlogNotes on ClausesX X X X Extracts X X X X X X X X Extracts X X X X ..... ncome between spouses governed by Portuguese Civil Code. Clause 11 of the Bill seeks to provide for incomes not included in total income and, inter alia, provides for details of certain income enumerated in Schedules II, III, IV, V and VI which are not to be included in computing the total income of any person for a tax year. It also deals with certain persons enumerated in Schedule VII who are not chargeable to tax under the proposed legislation for a tax year. Clause 12 of the Bill provides for income not to be included in total income of political parties and electoral trust enumerated in Schedule VIII which are not to be included in computing their total income for a tax year. Clause 13 of the Bill provides for classification under various heads of income for the purposes of charge of income-tax and computation of total income. Clause 14 of the Bill provides for disallowance of certain expenditure incurred in relation to income which does not form part of the total income and expenditure in relation to such income. Clause 15 of the Bill provides for under the head salaries. Clause 16 of the Bill provides for different payments made by an employer to an employee which may ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mployees, interest paid on borrowed capital. Clause 33 of the Bill provides for deduction in respect of tangible and intangible assets owned and used for the purposes of business. Clause 34 of the Bill provides for general conditions for allowing expenditure (other than capital and personal expenditure) incurred wholly and exclusively for the purposes of business or profession being carried on by assessee. Clauses 35 and 36 of the Bill provides for amounts not to be allowed while computing the income under the head "Profit and gains of business or profession". Clause 37 of the Bill provides for certain deductions allowed on certain expenditures which is to be made only on actual payment basis. Clause 38 of the Bill provides for certain sums that are liable to be deemed as profit and gains of business or profession where the sums have been earlier allowed as expenditure or deduction for the purpose of computation of income. Clause 39 of the Bill provides for certain definitions such as actual cost, written down value, speculative transactions, etc. Clause 40 of the Bill provides for special provision for computation of cost of acquisition of certain assets. Clause 41 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assets (other than capital assets) in specific cases. Clause 54 of the Bill provides for deduction of certain capital expenditure expenses incurred in business of prospecting for mineral oils Clause 55 of the Bill provides for the manner of computation of profits or gains in cases of insurance business. Clause 56 of the Bill provides for computation of interest income of specified financial institutions. Clause 57 of the Bill provides for revenue recognition for construction and service contracts. Clause 58 of the Bill provides for special provision for computing profits and gains of business of profession on presumptive basis in case of certain residents. Clause 59 of the Bill provides for chargeability of royalty and fee for technical services in hands of non-residents. Clause 60 of the Bill seeks to provide the manner for computation for allowing the deduction of head office expenditure in case of non-residents. Clause 61 of the Bill provides for special provision for computation of income on presumptive basis in respect of certain business activities of certain non-residents Clause 62 of the Bill provides for maintenance of books of accounts and seeks to deal with main ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovides for the fair market value shall be deemed to the full value of consideration as a result of transfer of a capital asset by an assessee where the consideration is not ascertainable or cannot be determined. Clause 81 of the Bill provides for advance money received regarding the transfer of a capital asset. Clause 82 of the Bill provides for the capital gains arising from profits on sale of residential properties. Clause 83 of the Bill provides for capital gains on transfer of land used for agricultural purposes not to be charged in certain cases. Clause 84 of the Bill provides for capital gains on compulsory acquisition of lands and buildings not to be charged in certain cases. Clause 85 of the Bill provides for capital gains not to be charged on investment in certain specific bonds. Clause 86 of the Bill provides for non-chargeability of capital gains in specific scenarios of investment in residential house. Clauses 87 and 88 of the Bill provide for exemption of capital gains on transfer of assets in cases of shifting of industrial undertaking from urban area and exemption of capital gains on transfer of assets in cases of shifting of industrial undertaking from urban ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... circumstances or conditions in which any sum found credited in the books of account maintained by the assessee shall be considered as unexplained credits and be included in the total income of the assessee. Clause 103 of the Bill provides for unexplained investment. It also seeks to provide the circumstances or conditions in which any investment made by the assessee shall be deemed as unexplained investment and be included in the total income of the assessee. Clause 104 of the Bill provides for the circumstances or conditions in which any asset owned by or belonging to the assessee shall be deemed as unexplained asset and be included in the total income of the assessee. Clause 105 of the Bill provides for the circumstances or conditions in which any expenditure incurred by the assessee shall be deemed to be unexplained expenditure and be included in the total income of the assessee. Clause 106 of the Bill seeks to provide that where any amount is borrowed on a hundi and other instruments like hundi from, or any amount due thereon is repaid to, any person otherwise than through an account payee cheque drawn on a bank, the amount so borrowed or repaid shall be deemed to be the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other person in such capacity or shall be permissible in case of change in shareholding of a company. Clause 120 of the Bill seeks to provide that no set off of loss or unabsorbed depreciation shall be allowed against undisclosed income, consequent to search, requisition and survey. Clause 121 of the Bill provides for submission of return for losses and also that no loss shall be carried forward and set off which has not been determined in pursuance of a return filed. Clause 122 of the Bill provides for the statutory compliance requirements, time limits and overall limits for claiming the deductions enumerated in Chapter VIII to eligible. Clause 123 of the Bill provides for deduction for insurance premia, deferred annuity, contributions to provident fund, etc. and to provide deduction to an assessee being an individual or Hindu undivided family in respect of payments made on account of insurance premia, deferred annuity, contribution to provident fund etc. specified in the relevant proposed Schedule. Clause 124 of the Bill seeks to provide for deduction in respect of employer contribution to pension scheme of Central Government. Clause 125 of the Bill seeks to provide for ded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m certain industrial undertakings and provides for deduction for industrial undertakings in North-eastern region and also in respect of undertakings promoting housing projects. Clause 142 of the Bill provides for deductions in respect of profits and gains of business of developing and building housing projects. Clause 143 of the Bill provides for special provisions in respect of profits and gains of certain undertakings with respect to production of eligible article or things in North-Eastern States. Clause 144 of the Bill provides for deduction in respect of profits and gains of newly established units in Special Economic Zones. Clause 145 of the Bill seeks to provide for deduction for businesses engaged in collecting and processing of bio-degradable waste. Clause 146 of the Bill provides for deduction in respect of additional employee cost and deduction in respect of additional employee cost in certain cases for specified period and shall be subject to conditions specified therein. Clause 147 of the Bill provides for deductions for income of Offshore Banking Units and Units of International Financial Services Centre. The said clause also seeks to provide for deductions for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ciated enterprise". Clause 163 of the Bill seeks to define the expression "international transaction". Clause 164 of the Bill seeks to define the expression "specified domestic transaction". Clause 165 of the Bill provides for determination of arm's length price and the methods for determining the arm's length price. Clause 166 of the Bill provides for referral of cases by the Assessing Officer to the Transfer Pricing Officer for determining the arm's length price. Clause 167 of the Bill provides for power of Board to make safe harbour rules to simplify compliance and reduce litigation. Clause 168 of the Bill provides for advance pricing agreement between the taxpayer and the tax authorities to pre-determine the arm's length price for specified transactions. Clause 169 of the Bill, inter alia, seeks to provide for giving effect to advance pricing agreement entered into by an assessee and consequential procedures. Clause 170 of the Bill provides for secondary adjustment in certain cases to ensure that the actual allocation of profits between the associated enterprises aligns with the arm's length price. Clause 171 of the Bill provides for maintenance, keeping and furnishing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cash with certain exceptions. Clause 189 of the Bill seeks to provide for definitions of certain expressions which, inter alia, includes banking company, specified sum, etc. Clause 190 of the Bill provides for the mode of computation of total income if it includes any income on which no income tax is payable. Clause 191 of the Bill seeks to provide for tax on accumulated balance of recognised provident fund. Clause 192 of the Bill provides for the tax liability on the total income in search cases. Clause 193 of the Bill provides for, inter alia, for special rates of tax on resident individuals employed by an entity engaged in a specified knowledge-based industry or services on income from Global Depository Receipts. Clause 194 of the Bill provides for taxation of earnings from lotteries, cross word puzzles, horse race, card games, online games, income from transfer of virtual digital assets. The said clause further provides for a concessional tax rate on royalty income on patents earned by a resident, income on transfer of carbon credits and profits and gains from insurance business. Clause 195 of the Bill provides for tax on certain income referred to in clauses 102 to 106. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... units, royalties and fees for technical services). Clause 208 of the Bill provides for special rates of taxes for offshore funds on investments made in foreign currency. Clause 209 of the Bill provides for special rates of taxes for non-residents on Global Depository Receipts including income by way of interest, dividend and income on transfer of such Global Depository Receipts. Clause 210 of the Bill provides for special rates of tax on income earned by Foreign Institutions Investors including dividend and interest on securities and capital gains on transfer of their securities. Clause 211 of the Bill provides for special rates of tax on non-residents sportsmen or sports associations with respect to certain incomes earned in India. Clause 212 of the Bill provides for Interpretation relating to Chapter XIII-E. The said clause seeks to provide the definitions of certain terms for the purposes of clauses 213 to 218. Clause 213 of the Bill provides for the method of computing the taxable income for non-resident Indians. Clause 214 of the Bill provides for the special rates of taxes on investment income and long terms capital gains earned by non-resident Indians. Clause 215 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fying assets and other assets whenever they are moved between the qualifying and non- qualifying businesses. Clause 230 of the Bill seeks to provide for general exclusion of losses, deductions and set off including the accrued losses incurred or claimed prior to opting of tonnage tax scheme by the company. Clause 231 of the Bill seeks to provide for the method of opting of tonnage tax scheme and validity. Clause 232 of the Bill seeks to provide for certain conditions for applicability of tonnage tax scheme. Clause 233 of the Bill seeks to provide for continuance of and validity of the scheme in the case of amalgamation and demerger. Clause 234 of the Bill seeks to provide for avoidance of tax and exclusion from tonnage tax scheme in case of abuse of the provisions by way of any arrangement made to avail tax advantage. Clause 235 of the Bill provides for definition of certain terms relating to tonnage tax scheme. Clause 236 of the Bill provides for various classes of income-tax authorities beginning from, the Central Board of Direct Taxes and up to Inspectors of Income-tax. Clause 237 of the Bill seeks to provide for the appointment of income-tax authorities by the Central G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ized or requisitioned under clauses 247 and 248 of the proposed legislation and provides time limitations for their retention by the authorities concerned. Clause 252 of the Bill provides for power to call for information of the income-tax authorities to call for information. Clause 253 of the Bill provides for powers of survey, i.e., entry into business premises of an assessee, restrictions imposed in exercises of this power and duties of the assesses during survey action. Clause 254 of the Bill seeks to provide for powers of authorities to collect certain information which may be useful, or relevant to the purposes of the proposed legislation. Clause 255 of the Bill seeks to provide for power to inspect registers of companies by income-tax authorities. Clause 256 of the Bill seeks to provide for the powers of Assessing Officer under the proposed legislation in relation to making enquiries to competent authority, i.e., higher authorities. Clause 257 of the Bill provides to treat proceedings before the income-tax authorities at par with the judicial proceedings. Clause 258 of the Bill provides for restrictions on disclosure of information in respect of assessees by income-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng the consequences of such an alignment. Clause 275 of the Bill provides for scheme for reference to the Dispute Resolution Panel. Clause 276 of the Bill seeks to provide for method of accounting to be followed for computation of income under the heads "Profits and gains of business or profession" and "Income from Other sources". Clause 277 of the Bill seeks to provide for valuation of inventory and securities as per income computation and disclosure standards. Clause 278 of the Bill seeks to provide for taxability of interest, compensation or enhanced compensation and escalation claims in respect of contract or export incentives. Clause 279 of the Bill seeks to provide for assessment of any income chargeable to tax which has escaped assessment. Clause 280 of the Bill seeks to provide for issue of notice where income has escaped assessment. Clause 281 of the Bill seeks to provide for procedure to be followed before issuance of notice under clause 280. Clause 282 of the Bill provides for time limit for notices in the cases of income escaping assessment. Clause 283 of the Bill seeks to provide provision for cases where assessment is in pursuance of an order on appeal, direc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation of income received in the capacity of representative assessee. Clause 305 of the Bill deals with the rights of the representative assessee to recover the taxes paid by him in his capacity as representative assessee. Clause 306 of the Bill seeks to deal with persons to act as an agent in relation to a non-resident. Clause 307 of the Bill seeks to provide for the charge of tax of certain representative assesses in a situation where the share of the beneficiaries is unknown or indeterminate. Clause 308 of the Bill provides for charge of tax in case of oral trust. Clause 309 of the Bill seeks to provide for the method of computing a member's share in income of association of persons or body of individuals. Clause 310 of the Bill deals with share of member of an association of persons or body of individuals in income of association or body. Clause 311 of the Bill seeks to provide for charge of tax in the hands of the association of persons or body of individuals where shares of members in such association or body is either known or unknown, represented in the form of a table. Clause 312 of the Bill seeks to provide for the chargeability of tax on the income of the estate o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y rules. Clause 327 of the Bill seeks to provide for assessment of a partnership firm in cases where there is a change in constitution of the firm. Clause 328 of the Bill provides for taxation in the hands of the predecessor and successor in the case of succession of one firm by another firm. Clause 329 of the Bill seeks to provide for joint and several liability of partners for tax payable by firm. Clause 330 of the Bill seeks to provide for assessment and liability in the hands of the firm even after its dissolution or discontinuance of the business. Clause 331 of the Bill provides for joint and several liability of partners of a limited liability partnership in liquidation. Clause 332 of the Bill provides for provisions related to registration of non-profit organisation. Clause 333 of the Bill seeks to provide provision related to switching over of regimes by a registered non-profit organisation . Clause 334 of the Bill seeks to provide taxability of income of a registered non-profit organisation. Clause 335 of the Bill provides the meaning of regular income of a registered non-profit organisation . Clause 336 of the Bill seeks to deal with the taxable regular income o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 355 of the Bill seeks to provide the meaning of different terms used in this Chapter. Clause 356 of the Bill seeks to provide for appeals to Joint Commissioner (Appeals) against certain orders. Clause 357 of the Bill seeks to provide for appeals to Commissioner (Appeals) against certain orders. Clause 358 of the Bill seeks to provide for form of appeal and limitation. Clause 359 of the Bill seeks to provide for procedure in appeal. Clause 360 of the Bill deal with the powers of Joint Commissioner (Appeals) and the Commissioner (Appeals). Clause 361 of the Bill provides for constitution of Income tax Appellate Tribunal. Clause 362 of the Bill seeks to provide for appeals to the Income tax Appellate Tribunal. Clause 363 of the Bill seeks to provide for the orders passed by the Income tax Appellate Tribunal. Clause 364 of the Bill seeks to provide for the powers and functions of the Income tax Appellate Tribunal. Clause 365 of the Bill seeks to provide for appeals to the High Court. Clause 366 of the Bill provide for appeals to the High Court to be heard by not less than two Judges. Clause 367 of the Bill seeks to provide for appeals to Supreme Court. Clause 368 of the B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pronounced by the Board for Advance Rulings. Clause 390 of the Bill provides for the provisions relating to tax deduction at source, tax collection at source, advance payment, etc., as modes of tax payment. Clause 391 of the Bill provides for provisions relating to direct payment of tax by assessee in certain conditions. Clause 392 of the Bill provides for provisions relating to tax deduction at source on salary and accumulated balance to an employee. Clause 393 of the Bill provides for provisions relating to tax deduction at source on various payments. Clause 394 of the Bill provides for provisions relating to tax collection at source on various transactions. Clause 395 of the Bill provides for provisions relating to issuance of certificate for lower deduction of tax. Clause 396 of the Bill seeks to provide the certain sums which shall be deemed as income received for the purposes of computing the income of the assessee. Clause 397 of the Bill seeks to provide for compliance and reporting requirements for tax deduction at source and tax collection at source. Clause 398 of the Bill seeks to provide for consequence for failure to deduct or collect or pay tax. Clause 399 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on. Clause 416 of the Bill empowers the Assessing Officer with modes of recovery where no certificate is drawn up by the Tax Recovery Officer. Clause 417 of the Bill provides for recovery of tax through State Government in any area where recovery of tax has been entrusted to a State Government under article 258(1) of the Constitution. Clause 418 of the Bill provides for recovery of tax on behalf of the Government of any foreign country under an agreement between the two Governments from a resident of India or a person having any property in India through a Tax Recovery Officer. Clause 419 of the Bill provides for the provisions relating to recovery of penalties, fine, interest and other sums in the same manner as provided for recovery of tax. Clause 420 of the Bill seeks to provide for the requirement of a no objection certificate to be issued by the prescribed authority to a person who is not domiciled in India and has come to India in connection with business, profession or employment and who has income derived from any source in India for leaving India. Clause 421 of the Bill seeks to provide that recovery by suit or under other law will not be affected notwithstanding tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eductible on the income on a claim made by him that no tax was required to be deducted on such income. Clause 435 of the Bill seeks to provide that the Assessing Officer shall refund any amount becoming due to the assessee as a result of any appellate order without the assessee being required to make any claim in this regard. Clause 436 of the Bill seeks to provide that the assessee shall not be entitled to question the correctness of any assessment or other matter which has become final or to claim any other relief except refund of tax wrongly paid or paid in excess. Clause 437 of the Bill seeks to provide that the assessee shall be entitled to receive interest in addition to the refund due to him. Clause 438 of the Bill seeks to provide for setting off the amount to be refunded or any part of that amount, against any sum remaining payable under this Bill by such person after giving prior intimation to such person. Clause 439 of the Bill seeks to impose penalty for under-reporting and mis-reporting of income. Clause 440 of the Bill deals with the conditions and circumstances under which immunity from imposition of penalty and initiation of prosecution proceedings. Clause 44 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of penalty for failure to furnish information or document under clause 506. Clause 459 of the Bill seeks to provide for imposition of penalty for failure to furnish report or for furnishing inaccurate report under clause 511. Clause 460 of the Bill seeks to provide for imposition of penalty for failure to submit statement under clause 505. Clause 461 of the Bill seeks to provide for imposition of penalty for failure to submit statement as required under clause 397(3)(b). Clause 462 of the Bill seeks to provide for imposition of penalty for failure to furnish information or furnishing inaccurate information as required under clause 397(3)(d). Clause 463 of the Bill seeks to provide for imposition of penalty for furnishing incorrect information in reports or certificates by any accountant or merchant banker or registered valuer. Clause 464 of the Bill seeks to provide for imposition of penalty for failure to furnish statements by certain institutions or funds. Clause 465 of the Bill seeks to provide for imposition of penalty for failure to answer questions, sign statements, furnish information, returns or statements, allow inspections, etc. Clause 466 of the Bill seeks to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Clause 488 of the Bill seeks to provide for punishment for Hindu undivided family. Clause 489 of the Bill seeks to provide for presumption as to assets, book of accounts, etc., in certain cases. Clause 490 of the Bill seeks to provide for presumption as to culpable mental state. Clause 491 of the Bill seeks to provide for previous sanction of the Commissioner or Principal Commissioner or Joint Commissioner (Appeals) or Commissioner (Appeals) or Principal Chief Commissioner to launch prosecution of certain offences. Clause 492 of the Bill seeks to provide for certain offences to be non-cognizable irrespective of the provisions contained in the Bharatiya Nagarik Suraksha Sanhita, 2023. Clause 493 of the Bill seeks to provide that entries in the records or other documents in the custody of an income-tax authority shall be admitted in evidence in any proceedings for the prosecution of any person for an offence. Clause 494 of the Bill provides for punishment for contravention of clause 258(3) relating to disclosure of information by public servants. Clause 495 of the Bill seeks to provide for trial of offences under the Bill by special Court. Clause 496 of the Bill seeks to pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent in the prescribed manner. Clause 511 of the Bill seeks to provide for furnishing of reports in respect of international group. Clause 512 of the Bill seeks to provide for publication of information in respect of proceedings or prosecution in certain cases. Clause 513 of the Bill seeks to provide that any assessee who is entitled or required to attend before any income-tax authority or the Appellate Tribunal in connection with any proceeding relating to valuation of any asset may be represented by a registered valuer. Clause 514 of the Bill seeks to provide for the procedure for registration of valuers. Clause 515 of the Bill seeks to provide that an assessee, entitled or required to attend before an income-tax authority or Appellate Tribunal for any proceeding under this Bill, may attend through an authorised representative. Clause 516 of the Bill seeks to provide for rounding off of amount of total income, or tax payable or payable or refundable. Clause 517 of the Bill seeks to provide that a receipt shall be given for any money paid or recovered under this Bill. Clause 518 of the Bill seeks to provide that every person deducting, retaining, or paying any tax in pursua ..... X X X X Extracts X X X X X X X X Extracts X X X X
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