An Act further to amend the Income-tax Act, 1961, the Wealth-tax Act,<\/p>\n
1957 and the Expenditure-tax Act, 1987.<\/p>\n
BE it enacted by Parliament in the Fifty-fourth Year of the Republic of<\/p>\n
India as follows:-<\/p>\n
CHAPTER I<\/span><\/strong><\/p>\n PRELIMINARY<\/span><\/strong><\/p>\n \u00a0<\/p>\n 1. Short title and commencement.-(1) This Act may be called the<\/p>\n Taxation Laws (Amendment) Act, 2003.<\/p>\n (2) Save as otherwise provided in this Act, it shall be deemed to have<\/p>\n come into force on the 8th day of September, 2003.<\/p>\n \u00a0<\/p>\n CHAPTER II<\/span><\/strong><\/p>\n AMENDMENTS TO THE INCOME-TAX ACT, 1961<\/span><\/strong><\/p>\n \u00a0<\/span><\/strong><\/p>\n 2. Amendment of section 10.-In section 10 of the Income-tax Act, 1961<\/p>\n (43 of 1961) (hereafter in this Chapter referred to as the Income-tax<\/p>\n Act), in clause (15),-<\/p>\n (A) after sub-clause (iiia), the following sub-clause shall be inserted<\/p>\n and shall be deemed to have been inserted with effect from the 1st day<\/p>\n of April, 2001, namely:-<\/p>\n “(iiib) interest payable to the Nordic Investment Bank, being a<\/p>\n multilateral financial institution constituted by the Governments of<\/p>\n Denmark, Finland, Iceland, Norway and Sweden, on a loan advanced by it<\/p>\n to a project approved by the Central Government in terms of the<\/p>\n Memorandum of Understanding entered into by the Central Government with<\/p>\n that Bank on the 25th day of November, 1986;”;<\/p>\n (B) in sub-clause (iv),-<\/p>\n (a) in item (c), the existing Explanation shall be numbered as<\/p>\n Explanation 1 thereof and after Explanation 1 as so numbered, the<\/p>\n following Explanation shall be inserted and shall be deemed to have<\/p>\n been inserted with effect from the 1st day of April, 1962, namely:-<\/p>\n “Explanation 2.-For the removal of doubts, it is hereby declared that<\/p>\n the usance interest payable outside India by an undertaking engaged in<\/p>\n the business of ship-breaking in respect of purchase of a ship from<\/p>\n outside India shall be deemed to be the interest payable on a debt<\/p>\n incurred in a foreign country in respect of the purchase outside<\/p>\n India;”;<\/p>\n (b) in the Explanation 1 occurring below item (i), after clause (d),<\/p>\n the following clause shall be inserted and shall be deemed to have been<\/p>\n inserted with effect from the 1st day of April, 1991, namely:-<\/p>\n “(da) the business of ship-breaking; or”.<\/p>\n \u00a0<\/p>\n 3. Insertion of new section 10BA.-After section 10B of the Income-tax<\/p>\n Act, the following section shall be inserted with effect from the 1st<\/p>\n day of April, 2004, namely:-<\/p>\n \u00a0<\/p>\n Special provisions in respect of export of certain articles or things.<\/p>\n \u00a0<\/p>\n 10BA. Special provisions in respect of export of certain articles or<\/p>\n things.-(1) Subject to the provisions of this section, a deduction of<\/p>\n such profits and gains as are derived by an undertaking from the export<\/p>\n out of India of eligible articles or things, shall be allowed from the<\/p>\n total income of the assessee:<\/p>\n Provided that where in computing the total income of the undertaking<\/p>\n for any assessment year, deduction under section 10A or section 10B has<\/p>\n been claimed, the undertaking shall not be entitled to the deduction<\/p>\n under this section:<\/p>\n Provided further that no deduction under this section shall be allowed<\/p>\n to any undertaking for the assessment year beginning on the 1st day of<\/p>\n April, 2010 and subsequent years.<\/p>\n (2) This section applies to any undertaking which fulfils the following<\/p>\n conditions, namely:-<\/p>\n (a) it manufactures or produces the eligible articles or things without<\/p>\n the use of imported raw materials;<\/p>\n (b) it is not formed by the splitting up, or the reconstruction, of a<\/p>\n business already in existence:<\/p>\n Provided that this condition shall not apply in respect of any<\/p>\n undertaking which is formed as a result of the re-establishment,<\/p>\n reconstruction or revival by the assessee of the business of any such<\/p>\n undertaking as is referred to in section 33B, in the circumstances and<\/p>\n within the period specified in that section;<\/p>\n (c) it is not formed by the transfer to a new business of machinery or<\/p>\n plant previously used for any purpose.<\/p>\n Explanation.-The provisions of Explanation 1 and Explanation 2 to subsection<\/p>\n (2) of section 80-I shall apply for the purposes of this clause<\/p>\n as they apply for the purposes of clause (ii) of sub-section (2) of<\/p>\n that section;<\/p>\n (d) ninety per cent. or more of its sales during the previous year<\/p>\n relevant to the assessment year are by way of exports of the<\/p>\n eligible articles or things;<\/p>\n (e) it employs twenty or more workers during the previous year in the<\/p>\n process of manufacture or production.<\/p>\n (3) This section applies to the undertaking, if the sale proceeds of<\/p>\n the eligible articles or things exported out of India are received in<\/p>\n or brought into, India by the assessee in convertible foreign exchange,<\/p>\n within a period of six months from the end of the previous year or,<\/p>\n within such further period as the competent authority may allow in this<\/p>\n behalf.<\/p>\n Explanation.-For the purposes of this sub-section, the expression<\/p>\n “competent authority” means the Reserve Bank of India or such other<\/p>\n authority as is authorised under any law for the time being in force<\/p>\n for regulating payments and dealings in foreign exchange.<\/p>\n (4) For the purposes of sub-section (1), the profits derived from<\/p>\n export out of India of the eligible articles or things shall be the<\/p>\n amount which bears to the profits of the business of the undertaking,<\/p>\n the same proportion as the export turnover in respect of such articles<\/p>\n or things bears to the total turnover of the business carried on by the<\/p>\n undertaking.<\/p>\n (5) The deduction under sub-section (1) shall not be admissible, unless<\/p>\n the assessee furnishes in the prescribed form, along with the return of<\/p>\n income, the report of an accountant, as defined in the Explanation<\/p>\n below sub-section (2) of section 288, certifying that the deduction has<\/p>\n been correctly claimed in accordance with the provisions of this<\/p>\n section.<\/p>\n (6) Notwithstanding anything contained in any other provision of this<\/p>\n Act, where a deduction is allowed under this section in computing the<\/p>\n total income of the assessee, no deduction shall be allowed under any<\/p>\n other section in respect of its export profits.<\/p>\n (7) The provisions of sub-section (8) and sub-section (10) of section<\/p>\n 80-IA shall, so far as may be, apply in relation to the undertaking<\/p>\n referred to in this section as they apply for the purposes of the<\/p>\n undertaking referred to in section 80-IA.<\/p>\n Explanation.-For the purposes of this section,-<\/p>\n (a) “convertible foreign exchange” means foreign exchange which is for<\/p>\n the time being treated by the Reserve Bank of India as convertible<\/p>\n foreign exchange for the purposes of the Foreign Exchange Management<\/p>\n Act, 1999 (42 of 1999), and any rules made thereunder or any other<\/p>\n corresponding law for the time being in force;<\/p>\n (b) “eligible articles or things” means all hand-made articles or<\/p>\n things, which are of artistic value and which requires the use of wood<\/p>\n as the main raw material;<\/p>\n (c) “export turnover” means the consideration in respect of export by<\/p>\n the undertaking of eligible articles or things received in, or brought<\/p>\n into, India by the assessee in convertible foreign exchange in<\/p>\n accordance with sub-section (3), but does not include freight,<\/p>\n telecommunication charges or insurance attributable to the delivery of<\/p>\n the articles or things outside India;<\/p>\n (d) “export out of India shall not include any transaction by way of<\/p>\n sale or otherwise, in a shop, emporium or any other establishment<\/p>\n situate in India, not involving clearance of any customs station as<\/p>\n defined in the Customs Act, 1962 (52 of 1962)..\u00a0<\/p>\n 4. Amendment of section 115P.-In section 115P of the Income-tax Act,<\/p>\n for the words “one and one-fourth per cent.”, the words “one per<\/p>\n cent.” shall be substituted.\u00a0<\/p>\n 5. Amendment of section 115S.-In section 115S of the Income-tax Act,<\/p>\n for the words “one and one-fourth per cent.”, the words “one per<\/p>\n cent.” shall be substituted.\u00a0<\/p>\n 6. Amendment of section 132B.-In section 132B of the Income-tax Act, in<\/p>\n sub-section (4), in clause (a), for the words “eight per cent.”, the<\/p>\n words “six per cent.” shall be substituted.\u00a0<\/p>\n 7. Amendment of section 158BFA.-In section 158BFA of the Income-tax<\/p>\n Act, in sub-section (1), for the words “one and one-fourth per cent.”,<\/p>\n the words “one per cent.” shall be substituted.\u00a0<\/p>\n 8. Amendment of section 201.-In section 201 of the Income-tax Act, in<\/p>\n sub-section (1A), for the words “fifteen per cent.”, the words “twelve<\/p>\n per cent.” shall be substituted<\/p>\n 9. Amendment of section 206C.-In section 206C of the Income-tax Act,-<\/p>\n (a) in sub-section (1),-<\/p>\n (i) for the Table, the following Table shall be substituted, namely:-<\/p>\n “TABLE<\/p>\n Sl. No. Nature of goods Percentage<\/p>\n (1) (2) (3)<\/p>\n (i) Alcoholic liquor for human consumption One per cent.<\/p>\n (ii) Tendu leaves Five per cent.<\/p>\n (iii) Timber obtained under a forest lease Two and one-half<\/p>\n per cent.<\/p>\n (iv) Timber obtained by any mode other than Two and one-half<\/p>\n per cent.<\/p>\n under a forest lease<\/p>\n (v) Any other forest produce not being timber Two and one-half<\/p>\n per cent.<\/p>\n or tendu leaves<\/p>\n (vi) Scrap One per cent. : “;<\/p>\n (ii) for the proviso below the Table, the following proviso shall be<\/p>\n substituted, namely:-<\/p>\n “Provided that every person, being a seller shall at the time, during<\/p>\n the period beginning on the 1st day of June, 2003 and ending on the day<\/p>\n immediately preceding the date on which the Taxation Laws (Amendment)<\/p>\n Act, 2003 comes into force, of debiting of the amount payable by the<\/p>\n buyer to the account of the buyer or of receipt of such amount from the<\/p>\n said buyer in cash or by the issue of a cheque or draft or by any other<\/p>\n mode, whichever is earlier, collect from the buyer of any goods of the<\/p>\n nature specified in column (2) of the Table as it stood immediately<\/p>\n before the 1st day of June, 2003, a sum equal to the percentage,<\/p>\n specified in the corresponding entry in column (3) of the said Table,<\/p>\n of such amount as income-tax in accordance with the provisions of this<\/p>\n section as they stood immediately before the 1st day of June, 2003.”;<\/p>\n (b) after sub-section (1), the following sub-sections shall be<\/p>\n inserted, namely:-<\/p>\n “(1A) Notwithstanding anything contained in sub-section (1), no<\/p>\n collection of tax shall be made in the case of a buyer, who is resident<\/p>\n in India, if such buyer furnishes to the person responsible for<\/p>\n collecting tax, a declaration in writing in duplicate in the prescribed<\/p>\n form and verified in the prescribed manner to the effect that the goods<\/p>\n referred to in column (2) of the aforesaid Table are to be utilised for<\/p>\n the purposes of manufacturing, processing or producing articles or<\/p>\n things and not for trading purposes.<\/p>\n (1B) The person responsible for collecting tax under this section shall<\/p>\n deliver or cause to be delivered to the Chief Commissioner or<\/p>\n Commissioner one copy of the declaration referred to in sub-section<\/p>\n (1A) on or before the seventh day of the month next following the month<\/p>\n in which the declaration is furnished to him.”;<\/p>\n (c) in sub-section (3), for the words “seven days”, the words “the<\/p>\n prescribed time” shall be substituted;<\/p>\n (d) in sub-section (5), for the words “ten days from the date of<\/p>\n debit”, the words “such period as may be prescribed from the time of<\/p>\n debit” shall be substituted;<\/p>\n (e) in sub-section (7), for the words “one and one-fourth per cent.”,<\/p>\n the words “one per cent.” shall be substituted;<\/p>\n (f) in the Explanation occurring at the end, in clause (a), for subclauses<\/p>\n (i) and (ii), the following sub-clauses shall be substituted,<\/p>\n namely:-<\/p>\n “(i) a public sector company, the Central Government, a State<\/p>\n Government, and an embassy, a high commission, legation, commission,<\/p>\n consulate and the trade representation, of a foreign State and a club;<\/p>\n or<\/p>\n (ii) a buyer in the retail sale of such goods purchased by him for<\/p>\n personal consumption;”.\u00a0<\/p>\n 10. Amendment of section 220.-In section 220 of the Income-tax Act, in<\/p>\n sub-section (2), for the words “one and one-fourth per cent.”, the<\/p>\n words “one per cent.” shall be substituted.\u00a0<\/p>\n 11. Amendment of section 230.-In section 230 of the Income-tax Act, in<\/p>\n sub-section (2), after the word, brackets and figure “sub-section (1)”,<\/p>\n the words, brackets, figure and letter “or the first proviso to sub-<\/p>\n section (1A)” shall be inserted and shall be deemed to have been<\/p>\n inserted with effect from the 1st day of June, 2003.\u00a0<\/p>\n 12. Amendment of section 234A.-In section 234A of the Income-tax Act,<\/p>\n in sub-sections (1) and (3), for the words “one and one-fourth per<\/p>\n cent.”, the words “one per cent.” shall be substituted.\u00a0<\/p>\n 13. Amendment of section 234B.-In section 234B of the Income-tax Act,<\/p>\n in sub-sections (1) and (3), for the words “one and one-fourth per<\/p>\n cent.”, the words “one per cent.” shall be substituted.<\/p>\n 14. Amendment of section 234C.-In section 234C of the Income-tax Act,<\/p>\n in sub-section (1),-<\/p>\n (i) in clause (a), in sub-clauses (i) and (ii), for the words “one and<\/p>\n one-fourth per cent.”, the words “one per cent.” shall be substituted;<\/p>\n (ii) in clause (b), in sub-clauses (i) and (ii), for the words “one and<\/p>\n one-fourth per cent.”, the words “one per cent.” shall be substituted.\u00a0<\/p>\n 15. Amendment of section 234D.-In section 234D of the Income-tax Act,<\/p>\n in sub-section (1), for the words “two-third per cent.”, the words<\/p>\n “one-half per cent.” shall be substituted.\u00a0<\/p>\n 16. Amendment of section 244A.-In section 244A of the Income-tax Act,<\/p>\n in sub-section (1), in clauses (a) and (b), for the words “two-third<\/p>\n per cent.”, the words “one-half per cent.” shall be substituted.\u00a0<\/p>\n 17. Amendment of section 272A.-In section 272A of the Income-tax Act,<\/p>\n in sub-section (2), after clause (i), the following clause shall be<\/p>\n inserted, namely:-<\/p>\n “(j) to deliver or cause to be delivered in due time a copy of the<\/p>\n declaration referred to in sub-section (1A) of section 206C,”.\u00a0<\/p>\n 18. Amendment of Second Schedule.-In the Second Schedule to the Incometax<\/p>\n Act, in rule 68A, in sub-rule (3), for the words “eight per cent.”,<\/p>\n the words “six per cent.” shall be substituted.<\/p>\n \u00a0<\/p>\n CHAPTER III<\/span><\/strong><\/p>\n AMENDMENTS TO THE WEALTH-TAX ACT, 195\u00a07<\/span><\/strong><\/p>\n 19. Amendment of section 17B.-In section 17B of the Wealth-tax Act,<\/p>\n 1957 (27 of 1957) (hereafter in this Chapter referred to as the Wealthtax<\/p>\n Act), in sub-sections (1) and (3), for the words “one and onefourth<\/p>\n per cent.”, the words “one per cent.” shall be substituted\u00a0<\/p>\n 20. Amendment of section 31.-In section 31 of the Wealth-tax Act, in<\/p>\n sub-section (2),-<\/p>\n (a) for the words “one and one-fourth per cent.”, the words “one per<\/p>\n cent.” shall be substituted;<\/p>\n (b) in the second proviso, for the words “one and one-fourth per<\/p>\n cent.”, the words “one per cent.” shall be substituted.\u00a0<\/p>\n 21. Amendment of section 34A.-In section 34A of the Wealth-tax Act,-<\/p>\n (a) in sub-section (3), for the words “eight per cent.”, the words “six<\/p>\n per cent.” shall be substituted;<\/p>\n (b) in sub-section (4B), in clause (a), for the words “two-third per<\/p>\n cent.”, the words “one-half per cent.” shall be substituted.<\/p>\n \u00a0<\/p>\n CHAPTER IV<\/span><\/strong><\/p>\n AMENDMENT TO THE EXPENDITURE-TAX ACT, 1987\u00a0<\/span><\/strong><\/p>\n 22. Amendment of section 14 of Act 35 of 1987.-In section 14 of the<\/p>\n Expenditure-tax Act, 1987 (35 of 1987), for the words “one and onefourth<\/p>\n per cent.”, the words “one per cent.” shall be substituted.\u00a0<\/p>\n 23. Repeal and saving.-(1) The Taxation Laws (Amendment) Ordinance,<\/p>\n 2003 is hereby repealed.<\/p>\n (2) Notwithstanding such repeal, anything done or any action taken<\/p>\n under the Income-tax Act, 1961 (43 of 1961), the Wealth-tax Act, 1957<\/p>\n (27 of 1957) and the Expenditure-tax Act, 1987 (35 of 1987), as amended<\/p>\n by the said Ordinance shall be deemed to have been done or taken under<\/p>\n the corresponding provisions of those Acts, as amended by this Act.<\/p>\n","protected":false},"excerpt":{"rendered":" An Act further to amend the Income-tax Act, 1961, the Wealth-tax Act, 1957 and the Expenditure-tax Act, 1987. BE it enacted by Parliament in the Fifty-fourth Year of the Republic of India as follows:- CHAPTER I PRELIMINARY \u00a0 1. Short title and commencement.-(1) This Act may be called the Taxation Laws (Amendment) Act, 2003. (2) […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_post_was_ever_published":false},"categories":[65],"tags":[118,117,116,120,121,119],"class_list":["post-1524","post","type-post","status-publish","format-standard","hentry","category-tax-law-act-rules","tag-bare-acts","tag-law","tag-legal","tag-notifications","tag-of-india","tag-rules"],"yoast_head":"\n