CHAPTER XII
DETERMINATION OF TAX IN CERTAIN SPECIAL CASES
1[J1] [110.
Determination of tax where total income includes income on which no tax is
payable2[J2] :-
Where there is included in
the total income of an assessee any income on which
no income-tax is payable under the provisions of this Act, the assessee shall be entitled to a deduction, from the amount
of income-tax with which he is chargeable on his total income, of an amount
equal to the income-tax calculated at the average rate of income-tax on the
amount on which no income-tax is payable].
111. Tax on accumulated balance of recognised provident fund:-
(1)
Where the accumulated balance due
to an employee participating in a recognised
provident fund is included in his total income, owing to the provisions of rule
8 of Part A of the Fourth Schedule not being applicable the 1[J3] [Assessing] Officer shall calculate the total of the
various sums of 2[J4] [tax] in accordance with the provisions of sub-rule (1) of
rule 9 thereof.
(2)
Where the accumulated balance due
to an employee participating in a recognised
provident fund which is not included in his total income under the provisions
of rule 8 of Part A of the Fourth Schedule becomes payable, super-tax shall be
calculated in the manner provided in sub-rule (2) of rule 9 thereof.
1[J5] [111A. Tax
on short-term capital gains in certain cases:-
(1)
Where the total income of an assessee includes any income chargeable under the head
"Capital gains", arising from the transfer of a short-term capital
asset, being an equity share in a company or a unit of an equity oriented fund
and—
(a) The transaction of
sale of such equity share or unit is entered into on or after the date on which
Chapter VII of the Finance (No. 2) Act, 2004 comes into force; and
(b) Such transaction is
chargeable to securities transaction tax under that Chapter, the tax payable by
the assessee on the total income shall be the
aggregate of—
(i) The
amount of income-tax calculated on such short-term capital gains at the rate of
2[J6] [ten per cent]; and
(ii) The amount of
income-tax payable on the balance amount of the total income as if such balance
amount were the total income of the assessee:
Provided that in the
case of an individual or a Hindu undivided family being a resident, where the
total income as reduced by such short-term capital gains is below the maximum
amount which is not chargeable to income-tax, then, such short-term capital
gains shall be reduced by the amount by which the total income as so reduced
falls short of the maximum amount which is not chargeable to income-tax and the
tax on the balance of such short-term capital gains shall be computed at the
rate of ten per cent.
(2)
Where the gross total income of an assessee includes any short-term capital gains referred to
in sub-section (1), the deduction under Chapter VIA shall be allowed from the
gross total income as reduced by such capital gains.
(3)
Where the total income of an assessee includes any short-term capital gains referred to
in sub-section (1), the rebate under section 88 shall be allowed from the
income-tax on the total income as reduced by such capital gains.
Explanation.—For
the purposes of this section, the expression "equity oriented fund"
shall have the meaning assigned to it in the Explanation to clause (38) of
section 10.]
1[J7] [112. Tax
on long-term capital gains:-
(1)
Where the total income of an assessee includes any income, arising from the transfer of
a long-term capital asset, which is chargeable under the head "Capital
gains", the tax payable by the assessee on the
total income shall be the aggregate of,—
(a) In the case of an
individual or a Hindu undivided family 2[J8] [being a resident],—
(i) The
amount of income-tax payable on the total income as reduced by the amount of
such long-term capital gains, had the total income as so reduced been his total
income; and
(ii) The amount of
income-tax calculated on such long-term capital gains at the rate of twenty per
cent:
Provided that
where the total income as reduced by such long-term capital gains is below the
maximum amount which is not chargeable to income-tax, then, such long-term
capital gains shall be reduced by the amount by which the total income as so
reduced falls short of the maximum amount which is not chargeable to income-tax
and the tax on the balance of such long-term capital gains shall be computed at
the rate of twenty per cent;
(b) In the case of a 3[J9] [domestic] company,—
(i) The
amount of income-tax payable on the total income as reduced by the amount of
such long-term capital gains, had the total income as so reduced been its total
income; and
(ii) The amount of
income-tax calculated on such long-term capital gains at the rate of 4[J10] [twenty] per
cent.
[Proviso omitted by the Finance Act, 1995, w.e.f.
1-4-1996. It was amended by the Finance Act, 1994, w.e.f.
1-4-1995.]
5[J11] [(c) in the case of a non-resident (not being a
company) or a foreign company,—
(i) The
amount of income-tax payable on the total income as reduced by the amount of
such long-term capital gains, had the total income as so reduced been its total
income; and
(ii) The amount of
income-tax calculated on such long-term capital gains at the rate of twenty per
cent;]
6[J12] [(d)] in any other case 7[J13] [of a resident],—
(i) the
amount of income-tax payable on the total income as reduced by the amount of
long-term capital gains, had the total income as so reduced been its total
income; and
(ii) The amount of
income-tax calculated on such long-term capital gains at the rate of 8[J14] [twenty] per
cent.
[Explanation omitted by the Finance Act, 1995, w.e.f.
1-4-1996.]
9[J15] [Provided that
where the tax payable in respect of any income arising from the transfer of a
long-term capital asset, being listed securities 10[J16] [or unit] 11[J17] [or zero coupon
bond], exceeds ten per cent of the amount of capital gains before giving effect
to the provisions of the second proviso to section 48, then, such excess shall
be ignored for the purpose of computing the tax payable by the assessee.
12[J18] [Explanation.—for
the purposes of this sub-section,—
(a) "Listed
securities," means the securities—
(i) As
defined in clause (h) of section 2 of the Securities Contracts
(Regulation) Act, 195613[J19] (32 of 1956); and 13 For the
provision
(ii)
Listed in any recognised
stock exchange in India;
(b) "Unit"
shall have the meaning assigned to it in clause (b) of Explanation to
section 115AB.]
(2)
Where the gross total income of an assessee includes any income arising from the transfer of a
long-term capital asset, the gross total income shall be reduced by the amount
of such income and the deduction under Chapter VIA shall be allowed as if the
gross total income as so reduced were the gross total income of the assessee.
(3)
Where the total income of an assessee includes any income arising from the transfer of a
long-term capital asset, the total income shall be reduced by the amount of
such income and the rebate under section 88 shall be allowed from the
income-tax on the total income as so reduced.]
DEPARTMENTAL
VIEW
1. The total income is to be computed in the manner prescribed
in the Income-tax Act. Set-off of loss as per the provisions of sections 70 to
80 is a stage which is part of this procedure. When this
procedure is adopted for computing gross total income or total income, only the
amount of income after set-off remains under a head as part of gross total
income or total income. Only that amount of long-term capital gains
which is included in the total income would be subject to tax at a prescribed
flat rate. Thus, if there was a loss of Rs. 10,000
from business and there is long-term capital gains of Rs.
30,000, then after setting off of loss of Rs. 10,000
with long-term capital gains only Rs. 20,000 would
remain under the head "Capital gains" to be included in the gross
total income or total income. The flat rate of tax will be applicable in
respect of Rs. 20,000 and not Rs.
30,000, since the amount of long-term capital gains included in that total
income is Rs. 20,000. (Here it is assumed that the
total income ignoring long-term capital gains is above the exemption limit.) [Circular
No. 721, dated 13 September, 1995.]
1[J20] [112A. Tax on interest on National Savings
Certificates (First Issue):-
Omitted
by the Finance Act, 1988, w.e.f. 1-4-1989. It was inserted by the Finance (No. 2) Act, 1965, w.e.f.
11-9-1965.]
1[J21] [113. Tax in the case of block assessment of
search cases:-
The total undisclosed income of the block period, determined under section 158BC, shall be chargeable to tax at the rate of sixty per cent:]
2[J22] [Provided that
the tax chargeable under this section shall be increased by a surcharge, if
any, levied by any Central Act and applicable in the assessment year relevant
to the previous year in which the search is initiated under section 132 or the
requisition is made under section 132A.]
1[J23] [114. Tax on capital gains in cases of
assesses other than companies:-
Omitted by the Finance (No.
2) Act, 1967, w.e.f. 1-4-1968 and reintroduced with
material modifications in section 80T.]
1[J24] [115. Tax on capital gains in case of
companies:-
Omitted
by the Finance Act, 1987, w.e.f. 1-4-1988.]
1[J25] [115A. Tax on dividends, royalty and technical
service fees in the case of foreign companies2[J26] :-
3[J27] [(1) Where the total income of—
(a)
A non-resident (not being a
company) or of a foreign company, includes any income by way of—
(i) Dividends
4[J28] [other than
dividends referred to in section 115-O]; or
(ii) Interest received from
Government or an Indian concern on monies borrowed or debt incurred by
Government or the Indian concern in foreign currency; or
(iii) Income received in
respect of units, purchased in foreign currency, of a Mutual Fund specified
under clause (23D) of section 10 or of the Unit Trust of India, the income-tax
payable shall be aggregate of—
(A) The amount of income-tax
calculated on the amount of income by way of dividends 5[J29] [other than
dividends referred to in section 115-O], if any, included in the total income,
at the rate of twenty per cent;
(B) the amount of income-tax
calculated on the amount of income by way of interest referred to in sub-clause
(ii), if any, included in the total income, at the rate of twenty per
cent;
(C) the amount of income-tax
calculated on the income in respect of units referred to in clause (iii),
if any, included in the total income, at the rate of twenty per cent; and
(D) the amount of income-tax
with which he or it would have been chargeable had his or its total income been
reduced by the amount of income referred to in sub-clause (i),
sub-clause (ii) and clause (iii);
(b)
6[J30] [a non-resident
(not being a company) or a foreign company, includes any income by way of
royalty or fees for technical services other than income referred to in
sub-section (1) of section 44DA] received from Government or an Indian concern
in pursuance of an agreement made by the foreign company with Government or the
Indian concern after the 31st day of March, 1976, and where such agreement is
with an Indian concern, the agreement is approved by the Central Government or
where it relates to a matter included in the industrial policy, for the time
being in force, of the Government of India, the agreement is in accordance with
that policy, then, subject to the provisions of sub-sections (1A) and (2), the
income-tax payable shall be the aggregate of,—
7[J31] [(A) the amount of income-tax calculated on
the income by way of royalty, if any, included in the total income, at the rate
of thirty per cent if such royalty is received in pursuance of an agreement
made on or before the 31st day of May, 1997 and twenty per cent where such
royalty is received in pursuance of an agreement made after the 31st day of
May, 1997 8[J32] [but before the
1st day of June, 2005];
9[J33] [(AA) the amount
of income-tax calculated on the income by way of royalty, if any, included in
the total income, at the rate of ten per cent if such royalty is received in
pursuance of an agreement made on or after the 1st day of June, 2005;]
(B)
the amount of income-tax calculated
on the income by way of fees for technical services, if any, included in the
total income, at the rate of thirty per cent if such fees for technical
services are received in pursuance of an agreement made on or before the 31st
day of May, 1997 and twenty per cent where such fees for technical services are
received in pursuance of an agreement made after the 31st day of May, 1997 10[J34] [but before the
1st day of June, 2005]; and]
11[J35] [(BB) the amount
of income-tax calculated on the income by way of fees for technical services,
if any, included in the total income, at the rate of ten per cent if such fees
for technical services are received in pursuance of an agreement made on or
after the 1st day of June, 2005; and]
(C)
the amount
of income-tax with which it would have been chargeable had its total income
been reduced by the amount of income by way of royalty and fees for technical
services.
Explanation.—For the purposes of this
section,—
(a) "Fees for
technical services" shall have the same meaning as in the Explanation 2
to clause (vii) of sub-section (1) of section 9;
(b) "Foreign
currency" shall have the same meaning as in the Explanation below
item (g) of sub-clause (iv) of clause
(15) of section 10;
(c) "Royalty"
shall have the same meaning as in Explanation 2 to clause (vi) of sub-section (1) of section 9;
(d) "Unit Trust of
India" means the Unit Trust of India established under the Unit Trust of
India Act, 1963 (52 of 1963).]
12[J36] [(1A) Where the
royalty referred to in clause (b) of sub-section (1) is in consideration
for the transfer of all or any rights (including the granting of a licence) in respect of copyright in any book to an Indian
concern 13[J37] [or in respect of
any computer software to a person resident in India], the provisions of
sub-section (1) shall apply in relation to such royalty as if the words 14[J38] [15[J39] [the agreement is
approved by the Central Government or where it] relates to a matter included in
the industrial policy, for the time being in force, of the Government of India,
the agreement is in accordance with that policy] occurring in the said clause
had been omitted:
Provided that such book is on
a subject, the books on which are permitted, according to the Import Trade
Control Policy of the Government of India for the period commencing from the
1st day of April, 1977, and ending with the 31st day of March, 1978, to be
imported into India under an Open General Licence:
16[J40] [Provided further
that such computer software is permitted according to the Import Trade Control
Policy of the Government of India for the time being in force to be imported
into India under an Open General Licence.]
Explanation
17[J41] [1].—In
this sub-section, "Open General Licence"
means an Open General Licence issued by the Central
Government in pursuance of the Imports (Control) Order, 1955.]
18[J42] [Explanation
2.—In this sub-section, the expression,
"computer software" shall have the meaning assigned to it in clause (b)
of the Explanation to section 80HHE.]
(2)
Nothing contained in sub-section
(1) shall apply in relation to any income by way of royalty received by a
foreign company from an Indian concern in pursuance of an agreement made by it
with the Indian concern after the 31st day of March, 1976, if such agreement is
deemed, for the purposes of the 19[J43] [first] proviso
to clause (vi) of sub-section (1) of section 9, to have been made before
the 1st day of April, 1976; and the provisions of the annual Finance Act for
calculating, charging, deducting or computing income-tax shall apply in
relation to such income as if such income had been received in pursuance of an
agreement made before the 1st day of April, 1976.]
20[J44] [(3) No deduction
in respect of any expenditure or allowance shall be allowed to the assessee under sections 28 to 44C and section 57 in
computing his or its income referred to in sub-section (1).
(4)
Where in the case of an assessee referred to in sub-section (1),—
(a)
The gross total income consists
only of the income referred to in clause (a) of that sub-section; no
deduction shall be allowed to him or it under Chapter VIA;
(b)
The gross total income includes any
income referred to in clause (a) of that sub-section, the gross total
income shall be reduced by the amount of such income and the deduction under
Chapter VIA shall be allowed as if the gross total income as so reduced were
the gross total income of the assessee.
(5)
It shall not be necessary for an assessee referred to in sub-section (1) to furnish under
sub-section (1) of section 139 a return of his or its income if—
(a)
his or its total income in respect
of which he or it is assessable under this Act during the previous year
consisted only of income referred to in clause (a) of sub-section (1);
and
(b)
The tax deductible at source under
the provisions of Chapter XVII-B has been deducted from such income.]
DEPARTMENTAL
VIEW
1. Wherever a Certificate of Residence is issued by the
Mauritian Authorities, such Certificate will constitute sufficient evidence for
accepting the status of residence as well as beneficial ownership for applying
the DTAC accordingly. [Circular No. 789, dated 13-4-2000] However, where
an Assessing Officer finds and is satisfied that a company or an entity is
resident of both India and Mauritius, he will be free to proceed to determine
the residential status under para 3 of Article 4 of
the DTAC. Where it is found as a fact that the company has its place of
effective management in India, then notwithstanding its being incorporated in
Mauritius, it would be taxed under the DTAC in India. [Circular No. 1/2003,
dated 10-2-2003]
2. The branch of a foreign company/concern in India is a
separate entity for the purposes of taxation. Interest paid/payable by such
branch to its head office or any branch located abroad would be liable to tax
in India and would be governed by this section. If the Double Taxation
Avoidance Agreement with the country where the parent company is assessed to
tax provides for a lower rate of taxation, the same would be applicable. [Circular
No. 740, dated 17-4-1996]
3. If the overseas corporate body is a foreign company and if
the investment in NRE and FCNR accounts or in deposits of public limited
companies, is made by way of remittance in foreign currency then the provisions
of section 115A(1)(ia)
would apply. [Circular No. 473, dated 29th October, 1986]
1[J45] [115AB. Tax on income from units purchased in foreign currency or
capital gains arising from their transfer:-
(1) Where the total income of an assessee, being an overseas financial organisation (hereinafter referred to as offshore fund) includes—
(a) Income received in respect of units purchased in foreign currency; or
(b) Income
by way of long-term capital gains arising from the transfer of units purchased
in foreign currency, the income-tax payable shall be the aggregate of—
(i) The amount of income-tax calculated on the
income in respect of units referred to in clause (a), if any, included
in the total income, at the rate of ten per cent;
(ii) The
amount of income-tax calculated on the income by way of long-term capital gains
referred to in clause (b), if any, included in the total income, at the
rate of ten per cent; and
(iii) The amount of income-tax with which the Offshore Fund would have
been chargeable had its total income been reduced by the amount of income
referred to in clause (a) and clause (b).
(2) Where the
gross total income of the Offshore Fund,—
(a) consists
only of income from units or income by way of long-term capital gains arising
from the transfer of units, or both, no deduction shall be allowed to the assessee under sections 28 to 44C 2[J46] [* * *] or clause
(i) or clause (iii) of section 57 or
under Chapter VIA 3[J47] [and nothing
contained in the provisions of the second proviso to section 48 shall apply to
income referred to in clause (b) of sub-section (1)];
(b) includes
any income referred to in clause (a), the gross total income shall be
reduced by the amount of such income and the deduction under Chapter VIA shall
be allowed as if the gross total income as so reduced were the gross total
income of the assessee.
Explanation.—for the purposes of this section,—
(a) "Overseas
financial organisation" means any fund,
institution, association or body, whether incorporated or not, established
under the laws of a country outside India, which has entered into an
arrangement for investment in India with any public sector bank or public
financial institution or a mutual fund specified under clause (23D) of section
10 and such arrangement is approved by the 4[J48] [Securities and
Exchange Board of India, established under the Securities and Exchange Board of
India Act, 1992 (15 of 1992),] for this purpose;
(b) "Unit"
means unit of a mutual fund specified under clause (23D) of section 10 or of
the Unit Trust of India;
(c) "Foreign
currency" shall have the meaning as in the Foreign Exchange Regulation
Act, 19735[J49] (46 of 1973);
(d) "Public
sector bank" shall have the meaning assigned to it in clause (23D) of
section 10;
(e) "Public
financial institution" shall have the meaning assigned to it in section 4A
of the Companies Act, 19566[J50] (1 of 1956);
(f) "Unit Trust of India" means the Unit
Trust of India established under the Unit Trust of India Act, 1963 (52 of
1963).]
1[J51] [115AC. Tax on income from bonds or Global Depository
Receipts purchased in foreign currency or capital gains arising from their
transfer:-
(1)
Where the total income of an assessee, being a non-resident, includes—2[J52]
(a) Income by way of interest on bonds of an Indian company issued in accordance with such scheme as the Central Government may, by notification in the Official Gazette, specify3[J53] in this behalf, or on bonds of a public sector company sold by the Government, and purchased by him in foreign currency; or
(b) Income
by way of dividends 4[J54] [other than
dividends referred to in section 115-O,] on Global Depository Receipts—
(i) Issued in accordance with such scheme as the Central Government may, by notification in the Official Gazette, specify in this behalf, against the initial issue of shares of an Indian company and purchased by him in foreign currency through an approved intermediary; or
(ii) Issued
against the shares of a public sector company sold by the Government and
purchased by him in foreign currency through an approved intermediary; or
(iii) 5[J55] [issued or]
re-issued in accordance with such scheme as the Central Government may, by
notification in the Official Gazette, specify in this behalf, against the
existing shares of an Indian company purchased by him in foreign currency
through an approved intermediary; or
6[J56] [(iv) Omitted by the Finance Act, 2002, w.e.f. 1-4-2002]
(c) Income
by way of long-term capital gains arising from the transfer of bonds referred
to in clause (a) or, as the case may be, Global Depository Receipts
referred to in clause (b), the income-tax payable shall be the aggregate
of—
(i) the amount of income-tax calculated on the
income by way of interest or dividends 7[J57] [other than
dividends referred to in section 115-O], as the case may be, in respect of
bonds referred to in clause (a) of Global Depository Receipts referred
to in clause (b), if any, included in the total income, at the rate of
ten per cent;
(ii) the
amount of income-tax calculated on the income by way of long-term capital gains
referred to in clause (c), if any, at the rate of ten per cent; and
(iii) the amount of income-tax with which the non-resident would
have been chargeable had his total income been reduced by the amount of income
referred to in clauses (a), (b) and (c).
(2) Where the
gross total income of the non-resident—
(a) consists
only of income by way of interest or dividends 8[J58] [other than
dividends referred to in section 115-O] in respect of bonds referred to in
clause (a) of sub-section (1) or, as the case may be, Global Depository
Receipts referred to in clause (b) of that sub-section, no deduction
shall be allowed to him under sections 28 to 44C or clause (i)
or clause (iii) of section 57 or under Chapter VIA;
(b) includes
any income referred to in clause (a) or clause (b) or clause (c)
of sub-section (1), the gross total income shall be reduced by the amount of
such income and the deduction under Chapter VIA shall be allowed as if the
gross total income as so reduced, were the gross total income of the assessee.
(3) Nothing
contained in the first and second provisos to section 48 shall apply for the
computation of long-term capital gains arising out of the transfer of long-term
capital asset, being bonds or Global Depository Receipts referred to in clause
(c) of sub-section (1).
(4) It shall
not be necessary for a non-resident to furnish under sub-section (1) of section
139 a return of his income, if—
(a) his
total income in respect of which he is assessable under this Act during the
previous year consisted only of income referred to in clauses (a) and (b)
of sub-section (1); and
(b) The
tax deductible at source under the provisions of Chapter XVIIB has been
deducted from such income.
(5) Where the assessee acquired Global Depository Receipts or bonds in an
amalgamated or resulting company by virtue of his holding Global Depository
Receipts or bonds in the amalgamating or demerged
company, as the case may be, in accordance with the provisions of sub-section
(1), the provisions of that sub-section shall apply to such Global Depository
Receipts or bonds.
Explanation.—for the purposes of this section,—
(a) "Approved
intermediary" means an intermediary who is approved in accordance with
such scheme as may be notified by the Central Government in the Official
Gazette;
(b) "Global
Depository Receipts" shall have the same meaning as in clause (a)
of the Explanation to section 115ACA.]
1[J59] [115ACA. Tax on income from Global Depository
Receipts purchased in foreign currency or capital gains arising from their
transfer:-
2[J60] [(1) Where the total income of an assessee, being an individual, who is a resident and an
employee of an Indian company engaged in specified knowledge based industry or
service, or an employee of its subsidiary engaged in specified knowledge based
industry or service (hereinafter in this section referred to as the resident employee),
includes—
(a) Income by way of
dividends, 3[J61] [other than
dividends referred to in section 115-O,] on Global Depository Receipts of an
Indian company engaged in specified knowledge based industry or service, issued
in accordance with such Employees' Stock Option Scheme as the Central
Government may, by notification in the Official Gazette, specify4[J62] in this behalf and purchased by him in foreign currency; or
(b) Income by way of
long-term capital gains arising from the transfer of Global Depository Receipts
referred to in clause (a), the income-tax payable shall be the aggregate
of—
(i) The
amount of income-tax calculated on the income by way of dividends, 5[J63] [other than
dividends referred to in section 115-O,] in respect of Global Depository
Receipts referred to in clause (a), if any, included in the total
income, at the rate of ten per cent;
(ii) The amount of
income-tax calculated on the income by way of long-term capital gains referred
to in clause (b), if any, at the rate of ten per cent; and
(iii) The
amount of income tax with which the resident employee would have been
chargeable had his total income been reduced by the amount of income referred
to in clauses (a) and (b).
Explanation.—For
the purposes of this sub-section,—
(a) "Specified
knowledge based industry or service" means—
(i) Information
technology software;
(ii) Information
technology service;
(iii) Entertainment
service;
(iv) Pharmaceutical
industry;
(v) Bio-technology
industry; and
(vi) Any other industry
or service, as may be specified by the Central Government, by notification in
the Official Gazette;
(b) "subsidiary"
shall have the meaning assigned to it in section 4 of the Companies Act, 1956
(1 of 1956), and includes subsidiary incorporated outside India.]
(2)
Where the gross total income of the
resident employee—
(a)
consists only of income by way of dividends, 6[J64] [other than
dividends referred to in section 115-O,] in respect of Global Depository
Receipts referred to in clause (a) of sub-section (1), no deduction
shall be allowed to him under any other provision of this Act;
(b)
includes any income referred to in clause (a) or clause (b) of
sub-section (1), the gross total income shall be reduced by the amount of such
income and the deduction under any provision of this Act shall be allowed as if
the gross total income as so reduced were the gross total income of the assessee.
(3) Nothing contained in the first and second
provisos to section 48 shall apply for the computation of long-term capital
gains arising out of the transfer of long-term capital asset, being Global
Depository Receipts referred to in clause (b) of sub-section (1).
Explanation. — For the purposes of this section,—
(a)
"Global Depository Receipts" means any instrument in the form of a
depository receipt or certificate (by whatever name called) created by the
Overseas Depository Bank outside India and issued to non-resident investors
against the issue of ordinary shares or foreign currency convertible bonds of
issuing company;
(b) "Information technology service"
means any service which results from the use of any information technology
software over a system of information technology products for realising value addition;
(c) "information technology software"
means any representation of instructions, data, sound or image, including
source code and object code, recorded in a machine readable form and capable of
being manipulated or providing inter-activity to a user, by means of an
automatic data processing machine falling under heading information technology
products but does not include non-information technology products;
(d) "Overseas Depository Bank" means a
bank authorised by the issuing company to issue
Global Depository Receipts against issue of Foreign Currency Convertible Bonds
or ordinary shares of the issuing company.]
1[J65] [115AD. Tax on income of Foreign Institutional
Investors from securities or capital gains arising from their transfer2[J66] :-
(1)
Where the total income of a Foreign
Institutional Investor includes—
3[J67] [(a)
Income 4[J68] [other than
income by way of dividends referred to in section 115-O] received in respect of
securities (other than unit referred to in section 115AB); or]
(b) Income by way of
short-term or long-term capital gains arising from the transfer of such
securities, the income-tax payable shall be the aggregate of—
(i) The
amount of income-tax calculated on the income in respect of securities referred
to in clause (a), if any, included in the total income, at the rate of
twenty per cent;
(ii) The amount of
income tax calculated on the income by way of short-term capital gains referred
to in clause (b), if any, included in the total income, at the rate of
thirty per cent:
5[J69] [Provided
that the amount of income-tax calculated on the income by way of short-term
capital gains referred to in section 111A shall be at the rate of 6[J70] [ten per cent:]]
(iii) the amount of
income-tax calculated on the income by way of long-term capital gains referred
to in clause (b), if any, included in the total income, at the rate of
ten per cent; and
(iv) The amount of income-tax with which the Foreign Institutional
Investor would have been chargeable had its total income been reduced by the
amount of income referred to in clause (a) and clause (b).
(2)
Where the gross total income of the
Foreign Institutional Investor—
(a) consists only of
income in respect of securities referred to in clause (a) of sub-section
(1), no deduction shall be allowed to it under sections 28 to 44C or clause (i) or clause (iii) of section 57 or under
Chapter VIA;
(b) includes any income
referred to in clause (a) or clause (b) of sub-section (1), the
gross total income shall be reduced by the amount of such income and the
deduction under Chapter VIA shall be allowed as if the gross total income as so
reduced, were the gross total income of the Foreign Institutional Investor.
(3)
Nothing contained in the first and
second provisos to section 48 shall apply for the computation of capital gains
arising out of the transfer of securities referred to in clause (b) of
sub-section (1).
Explanation.—for the purposes of this section,—
(a) The expression
"Foreign Institutional Investor" means such investor as the Central
Government may, by notification7 [J71] in the Official
Gazette, specify in this behalf;
(b) The expression
"securities" shall have the meaning assigned to it in clause (h)
of section 2 of the Securities Contracts (Regulation) Act, 19568[J72] (42 of 1956).]
DEPARTMENTAL
VIEW
1. FIIs which are resident in Mauritius will not be taxable in
India on income from capital gains arising in India on sale of shares. [Circular
No. 789, dated 13-4-2000] However, where an Assessing Officer finds and is
satisfied that a company or an entity is resident of both India and Mauritius,
he will be free to proceed to determine the residential status under para 3 of Article 4 of the DTAC. Where it is found as a
fact that the company has its place of effective management in India, then
notwithstanding its being incorporated in Mauritius, it would be taxed under
the DTAC in India. [Circular No. 1/2003, dated 10-2-2003]
1[J73] [115B. Tax on profits and gains of life
insurance business:-
2[J74] [(1)] Where the total income of an assessee includes any profits and gains from life insurance
business, the income-tax payable shall be the aggregate of—
(i) The
amount of income-tax calculated on the amount of profits and gains of the life
insurance business included in the total income, at the rate of twelve and
one-half per cent; and
(ii) The
amount of income tax with which the assessee would
have been chargeable had the total income of the assessee
been reduced by the amount of profits and gains of the life insurance
business.]
3[J75] [(2) Notwithstanding anything contained in
sub-section (1) or in any other law for the time being in force or any
instrument having the force of law, the assessee
shall, in addition to the payment of income-tax computed under sub-section (1),
deposit, during 4[J76] [the previous
years relevant to the assessment years commencing on the 1st day of April, 1989
and the 1st day of April, 1990], an amount equal to thirty-three and one-third
per cent of the amount of income-tax computed under clause (i)
of sub-section (1), in such social security fund (hereafter in this sub-section
referred to as the security fund), as the Central Government may, by
notification5[J77] in the Official Gazette, specify in this behalf :
Provided that where the assessee makes during the said previous 6[J78] [years] any
deposit of an amount of not less than two and one-half per cent of the profits
and gains of the life insurance business in the security fund, the amount of
income-tax payable by the assessee under the said
clause (i) shall be reduced by an amount equal
to two and one-half per cent of such profits and gains and, accordingly, the
deposit of thirty-three and one-third per cent required to be made under this
sub-section shall be calculated on the income tax as so reduced.]
1[J79] [115BB. Tax on winnings from lotteries,
crossword puzzles, races including horse races, card games and other games of
any sort or gambling or betting of any form or nature whatsoever:-
Where the total income of an assessee includes any income by way of winnings from any lottery or crossword puzzle or race including horse race (not being income from the activity of owning and maintaining race horses) or card game and other game of any sort or from gambling or betting of any form or nature whatsoever, the income-tax payable shall be the aggregate of—
(i) The amount
of income-tax calculated on income by way of winnings from such lottery or
crossword puzzle or race including horse race or card game and other game of
any sort or from gambling or betting of any form or nature whatsoever, at the
rate of 2[J80] [thirty] per cent; and
(ii) The
amount of income-tax with which the assessee would
have been chargeable had his total income been reduced by the amount of income
referred to in clause (i).
Explanation.—For the purposes of this section,
"horse race" shall have the same meaning as in section 74A.]
1[J81] [115BBA. Tax on non-resident sportsmen or sports
associations:-
(1) Where the total income of an assessee,—
(a) Being a sportsman (including an athlete), who is not a citizen of India and is a non-resident, includes any income received or receivable by way of—
(i) Participation in India in any game (other than a game the winnings wherefrom are taxable under section 115BB) or sport; or
(ii) Advertisement;
or
(iii) Contribution
of articles relating to any game or sport in India in newspapers, magazines or
journals; or
(b) being
a non-resident sports association or institution, includes any amount
guaranteed to be paid or payable to such association or institution in relation
to any game (other than a game the winnings wherefrom are taxable under section
115BB) or sport played in India, the income-tax payable by the assessee shall be the aggregate of—
(i) The amount of income-tax calculated on
income referred to in clause (a) or clause (b) at the rate of ten
per cent; and
(ii) `The amount of income-tax with which the assessee would have been chargeable had the total income of
the assessee been reduced by the amount of income
referred to in clause (a) or clause (b):
Provided that no
deduction in respect of any expenditure or allowance shall be allowed under any
provision of this Act in computing the income referred to in clause (a)
or clause (b).
(2) It shall not be
necessary for the assessee to furnish under sub-section
(1) of section 139 a return of his income if—
(a) His total income in respect of which he is assessable under this Act during the previous year consisted only of income referred to in clause (a) or clause (b) of sub-section (1); and
(b) The
tax deductible at source under the provisions of Chapter XVIIB has been
deducted from such income.]
1[J82] [115BBB. Tax on income from units of an
open-ended equity oriented fund of the Unit Trust of India or of Mutual Funds:-
(1) Where the total income of an
assessee includes any income from units of an
open-ended equity oriented fund of the Unit Trust of India or of a Mutual Fund,
the income-tax payable shall be the aggregate of—
(a) The amount of
income-tax calculated on income from units of an open-ended equity oriented
fund of the Unit Trust of India or of a Mutual Fund, at the rate of ten per
cent; and
(b) The amount of
income-tax with which the assessee would have been
chargeable had his total income been reduced by the amount of income referred
to in clause (a).
(2) Nothing contained in
sub-section (1) shall apply in relation to any income from units of an
open-ended equity oriented fund of the Unit Trust of India or of the Mutual
Fund arising after the 31st day of March, 2003.
Explanation.—For the purposes of
this section, the expressions "Mutual Fund", "open-ended equity
oriented fund" and "Unit Trust of India" shall have the meanings
respectively assigned to them in the Explanation to section 115T.]
1[J83] [115BBC. Anonymous donations
to be taxed in certain cases:-
(1)
Where the total income of an assessee, being a person in receipt of income on behalf of
any university or other educational institution referred to in sub-clause (iiiad) or sub-clause (vi) or any hospital or
other institution referred to in sub-clause (iiiae)
or sub-clause (via) or any fund or institution referred to in sub-clause
(iv) or any trust or institution referred to in sub-clause (v) of
clause (23C) of section 10 or any trust or institution referred to in section
11, includes any income by way of any anonymous donation, the income-tax
payable shall be the aggregate of—
(i) The
amount of income-tax calculated on the income by way of any anonymous donation,
at the rate of thirty per cent; and
(ii)
The amount of income-tax with which
the assessee would have been chargeable had his total
income been reduced by the amount of income referred to in clause (i).
(2)
The provisions of sub-section (1)
shall not apply to any anonymous donation received by—
(a)
Any trust or institution created or
established wholly for religious purposes;
(b)
Any trust or institution created or
established wholly for religious and charitable purposes other than any
anonymous donation made with a specific direction that such donation is for any
university or other educational institution or any hospital or other medical
institution run by such trust or institution.
(3)
For the purposes of this section,
"anonymous donation" means any voluntary contribution referred to in
sub-clause (iia) of clause (24) of section 2,
where a person receiving such contribution does not maintain a record of the
identity indicating the name and address of the person making such contribution
and such other particulars as may be prescribed.]
[J1]Substituted by the Finance Act, 1965, w.e.f. 1-4-1965.
[J2]See Circular No. 3-D (XVII-4), dated 25-1-1963.
[J3]Substituted for "Income-tax" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.
[J4]Substituted for "income-tax and super-tax" by the Finance Act, 1965, w.e.f. 1-4-1965.
[J5]Inserted by the Finance (No. 2) Act, 2004, w.e.f. 1-4-2005.
[J6]Being substituted by "fifteen per cent" by the Finance Act, 2008, w.e.f. 1-4-2009.
[J7]Inserted by the Finance Act, 1992, w.e.f. 1-4-1993. Earlier, the original section 112 was amended by the Finance Act, 1965, w.e.f. 1-4-1965 and the Finance (No. 2) Act, 1965, w.e.f. 11-9-1965 and omitted by the Finance (No. 2) Act, 1967, w.e.f. 1-4-1968, simultaneously being replaced by section 80S.
[J8]Inserted by the Finance Act, 1994, w.e.f. 1-4-1995.
[J9]Inserted by the Finance Act, 1994, w.e.f. 1-4-1995.
[J10]Substituted for "thirty" by the Finance (No. 2) Act, 1996, w.e.f. 1-4-1997. Earlier, "thirty" was substituted for "forty" by the Finance Act, 1994, w.e.f. 1-4-1995.
[J11]Inserted by the Finance Act, 1994, w.e.f. 1-4-1995.
[J12]Relettered for "(c)" by the Finance Act, 1994, w.e.f. 1-4-1995.
[J13]Inserted by the Finance Act, 1994, w.e.f. 1-4-1995.
[J14]Substituted for "thirty" by the Finance (No. 2) Act, 1996, w.e.f. 1-4-1997.
[J15]Inserted by the Finance Act, 1999, w.e.f. 1-4-2000.
[J16]Inserted by the Finance Act, 2000, w.e.f. 1-4-2000.
[J17]Inserted by the Finance Act, 2005, w.e.f. 1-4-2006.
[J18]Substituted by the Finance Act, 2000, w.e.f. 1-4-2000.
[J20]Prior to the omission, section 112A was amended by the Finance Act, 1966, w.e.f. 1-4-1966; Finance (No. 2) Act, 1967, w.e.f. 1-4-1968; Taxation Laws (Amendment) Act, 1970, w.r.e.f. 1-4-1968/1-4-1969 and Finance Act, 1973, w.r.e.f. 1-4-1972.
[J21]Inserted by the Finance Act, 1995, w.e.f. 1-7-1995. Earlier, section 113 dealt with tax in the case of a non-resident and was omitted by the Finance Act, 1965, w.e.f. 1-4-1965.
[J22]Inserted by the Finance Act, 2002, w.e.f. 1-6-2002.
[J23]Prior to the omission, section 114 was substituted by the Finance (No. 2) Act, 1962, w.e.f. 1-4-1962 and amended by the Finance Act, 1964, w.e.f. 1-4-1964; Finance Act, 1965, w.e.f. 1-4-1965; Finance (No. 2) Act, 1965, w.e.f. 11-9-1965 and the Finance Act, 1966, w.e.f. 1-4-1966.
[J24]Prior to the omission, section 115 was substituted by the Finance (No. 2) Act, 1962, w.e.f. 1-4-1962; amended by the Finance Act, 1964, w.e.f. 1-4-1964; substituted by the Finance Act, 1965, w.e.f. 1-4-1965; amended by the Finance Act, 1966, w.e.f. 1-4-1966; substituted by the Finance (No. 2) Act, 1971, w.e.f. 1-4-1972 and amended by the Finance (No. 2) Act, 1974, w.e.f. 1-4-1975; Finance Act, 1976, w.e.f. 1-4-1977 and the Finance Act, 1985, w.e.f. 1-4-1986.
[J25]Inserted by the Finance Act, 1976, w.e.f. 1-6-1976.
[J26]See Circular No. 473, dated 29-10-1986; 740, dated 17-4-1996 and 789, dated 13-4-2000.
[J27]Substituted by the Finance Act, 1994, w.e.f. 1-4-1995. Prior to the substitution, sub-section (1) was amended by the Finance (No. 2) Act, 1977, w.e.f. 1-4-1977; Finance (No. 2) Act, 1977, w.e.f. 1-4-1978; Finance Act, 1983, w.e.f. 1-6-1983; Finance Act, 1986, w.e.f. 1-4-1987; Direct Tax Laws (Amendment) Act, 1989, w.e.f. 1-4-1989 and the Finance Act, 1992, w.e.f. 1-6-1992.
[J28]Inserted by the Finance Act, 2003 w.e.f. 1-4-2004. These words were inserted by the Finance Act, 1997, w.e.f. 1-4-1998 and omitted by the Finance Act, 2002, w.e.f. 1-4-2003.
[J29]Ibid.
[J30]Substituted for "a foreign company, includes any income by way of royalty or fees for technical services" by the Finance Act, 2003, w.e.f. 1-4-2004.
[J31]Substituted by the Finance Act, 1997, w.e.f. 1-4-1998.
[J32]Inserted by the Finance Act, 2005, w.e.f. 1-4-2006.
[J33]Inserted by the Finance Act, 2005, w.e.f. 1-4-2006.
[J34]Inserted by the Finance Act, 2005, w.e.f. 1-4-2006.
[J35]Inserted by the Finance Act, 2005, w.e.f. 1-4-2006.
[J36]Inserted by the Finance (No. 2) Act, 1977, w.e.f. 1-4-1978.
[J37]Inserted by the Finance (No. 2) Act, 1991, w.e.f. 1-4-1991.
[J38]Substituted for "and approved by the Central Government" by the Finance Act, 1992, w.e.f. 1-6-1992.
[J39]Substituted for "approved by the Central Government or where the agreement" by the Finance Act, 1994, w.e.f. 1-4-1995.
[J40]Inserted by the Finance (No. 2) Act, 1991, w.e.f. 1-4-1991.
[J41]Renumbered, ibid.
[J42]Inserted, ibid.
[J43]Inserted by the Finance (No. 2) Act, 1991, w.e.f. 1-4-1991.
[J44]Inserted by the Finance Act, 1994, w.e.f. 1-4-1995.
[J45]Inserted by the Finance (No. 2) Act, 1991, w.e.f. 1-4-1992.
[J46]The words "or sub-section (2) of section 48" omitted by the Finance Act, 1992, w.e.f. 1-4-1993.
[J47]Inserted by the Finance Act, 1992, w.e.f. 1-4-1993.
[J48]Substituted for "Central Government" by the Finance Act, 2001, w.e.f. 1-6-2001.
[J49]Now, see section 2(m), Foreign Exchange Management Act, 1999.
[J51]Substituted by the Finance Act, 2001, w.e.f.
1-4-2002. Prior to the substitution, section 115AC, as inserted by the Finance
Act, 1992, w.e.f. 1-4-1993 and amended from time to
time, read as under:
"115AC. Tax on income from bonds or shares
purchased in foreign currency or capital gains arising from their transfer.—(1)
Where the total income of an assessee, being a
non-resident, includes—
(a)
income by way of interest or dividends 1[other than dividends referred to in
section 115-O], on bonds or shares of an Indian company, issued in accordance
with such scheme as the Central Government may, by notification in the Official
Gazette, specify in this behalf, 2[or on bonds or shares of a public sector
company, sold by the Government] and purchased by him in foreign currency; or
(b) income by way of long-term
capital gains arising from the transfer of bonds or, as the case may be, shares
referred to in clause (a), the income-tax payable shall be the aggregate of—
(i) the amount of income-tax
calculated on the income by way of interest or dividends 3[other than dividends
referred to in section 115-O], as the case may
be, in respect of bonds or shares referred to in clause (a), if any, included
in the total income, at the rate of ten per cent;
(ii) the amount of income-tax calculated on the income
by way of long-term capital gains referred to in clause (b), if any, at the
rate of ten per cent; and
(iii) the amount of income-tax
with which the non-resident would have been chargeable had his total income
been reduced by the amount of income referred to in clause (a) and clause (b).
(2) Where the gross total income of the non-resident—
(a) consists only of income by way of interest or
dividends 4[other than dividends referred to in section 115-O] in respect of
bonds or, as the case may be, shares referred to in clause (a) of sub-section
(1), no deduction shall be allowed to him under sections 28 to 44C or clause (i) or clause (iii) of section 57 or under Chapter VIA;
(b) includes any income referred to in clause (a) or
clause (b) of sub-section (1) the gross total income shall be reduced by the
amount of such income and the deduction under Chapter VIA shall be allowed as
if the gross total income as so reduced, were the gross total income of the assessee.
(3) Nothing contained in the first and second provisos
to section 48 shall apply for the computation of long-term capital gains
arising out of the transfer of long-term capital asset, being bonds or shares
referred to in clause (b) of sub-section (1).
(4) It shall not be necessary for a non-resident to
furnish under sub-section (1) of section 139 a return of his income if—
(a) his total income in respect of which he is
assessable under this Act during the previous year consisted only of income
referred to in clause (a) of sub-section (1); and
(b) the tax deductible at
source under the provisions of Chapter XVIIB has been deducted from such
income.]
5[(5) Where the assessee
acquired shares or bonds in an amalgamated or resulting company by virtue of
his holding shares or bonds in the amalgamating or demerged
company, as the case may be, in accordance with the provisions of sub-section
(1), the provisions of the said sub-section shall apply to such shares or
bonds."
1 Inserted by the Finance Act, 1997, w.e.f. 1-4-1998.
2 Inserted by the Finance (No. 2) Act, 1996, w.e.f. 1-10-1996.
3 Inserted by the Finance Act, 1997, w.e.f. 1-4-1998.
4 Ibid.
5 Inserted by the Finance Act, 1999, w.e.f. 1-4-2000.
[J52]Substituted by the Finance Act, 2001, w.e.f.
1-4-2002. Prior to the substitution, section 115AC, as inserted by the Finance
Act, 1992, w.e.f. 1-4-1993 and amended from time to
time, read as under:
"115AC. Tax on income from bonds or shares
purchased in foreign currency or capital gains arising from their transfer.—(1)
Where the total income of an assessee, being a
non-resident, includes—
(a) income by way of interest or dividends
1[other than dividends referred to in section 115-O], on bonds or shares of an
Indian company, issued in accordance with such scheme as the Central Government
may, by notification in the Official Gazette, specify in this behalf, 2[or on
bonds or shares of a public sector company, sold by the Government] and
purchased by him in foreign currency; or
(b) income by way of
long-term capital gains arising from the transfer of bonds or, as the case may
be, shares referred to in clause (a),
the income-tax payable shall be the aggregate of—
(i) the amount of income-tax calculated on the income
by way of interest or dividends 3[other than dividends referred to in section
115-O], as the case may be,
in respect of bonds or shares referred to in clause (a), if any,
included in the total income, at the rate of ten per cent;
(ii)
the amount of income-tax calculated on the income by way of long-term capital
gains referred to in clause (b), if any, at the rate of ten per cent;
and
(iii)
the amount of income-tax with which the non-resident
would have been chargeable had his total income been reduced by the amount of
income referred to in clause
(a) and clause (b).
(2) Where the gross total income of the non-resident—
(a)
consists only of income by way of interest or dividends 4[other than dividends
referred to in section 115-O] in respect of bonds or, as the case may be,
shares referred to in clause (a) of sub-section (1), no deduction shall
be allowed to him under sections 28 to 44C or clause (i)
or clause (iii) of section 57 or under Chapter VIA;
(b)
includes any income referred to in clause (a) or clause (b) of
sub-section (1) the gross total income shall be reduced by the amount of such
income and the deduction under Chapter VIA shall be allowed as if the gross
total income as so reduced, were the gross total income of the assessee.
(3) Nothing contained in the first and
second provisos to section 48 shall apply for the computation of long-term
capital gains arising out of the transfer of long-term capital asset, being
bonds or shares referred to in clause (b) of sub-section (1).
(4) It shall not be necessary for a
non-resident to furnish under sub-section (1) of section 139 a return of his
income if—
(a)
his total income in respect of which he is assessable under this Act during the
previous year consisted only of income referred to in clause (a) of
sub-section (1); and
(b)
the tax deductible at source under the provisions of
Chapter XVIIB has been deducted from such income.]
5[(5) Where the assessee
acquired shares or bonds in an amalgamated or resulting company by virtue of
his holding shares or bonds in the amalgamating or demerged
company, as the case may be, in accordance with the provisions of sub-section
(1), the provisions of the said sub-section shall apply to such shares or
bonds."
1 Inserted by the Finance Act, 1997, w.e.f. 1-4-1998.
2 Inserted by the Finance (No. 2) Act,
1996, w.e.f. 1-10-1996.
3 Inserted by the Finance Act, 1997, w.e.f. 1-4-1998.
4 Ibid.
5 Inserted by the Finance Act, 1999, w.e.f. 1-4-2000.
[J53]The Issue of Foreign Currency Exchangeable Bonds Scheme, 2008 has been specified in respect of assessment year 2008-09 and subsequent assessment years: Notification No. SO 386(E), dated 21-2-2008.
[J54]Inserted by the Finance Act, 2003, w.e.f. 1-4-2004. These words were omitted by the Finance Act, 2002, w.e.f. 1-4-2003.
[J55]Inserted by the Finance Act, 2002, w.e.f. 1-4-2002.
[J56]Prior to the omission, clause (iv), as
originally enacted by the Finance Act, 2001, w.e.f.
1-4-2002, read as under:
"(iv) issued in accordance with such scheme as the Central Government may, by notification in the Official Gazette, specify in this behalf, and purchased by him in foreign currency through an approved intermediary, against the shares of an Indian company arising out of disinvestment by such company in its subsidiary company, and the shares of both such Indian companies are listed in a recognised stock exchange in India; or"
[J57]Inserted by the Finance Act, 2003, w.e.f. 1-4-2004. These words were omitted by the Finance Act, 2002, w.e.f. 1-4-2003.
[J58]Ibid.
[J59]Inserted by the Finance Act, 1999, w.e.f. 1-4-2000.
[J60]Substituted by the Finance Act, 2001, w.e.f. 1-4-2001. Prior to the substitution, sub-section
(1), as originally enacted, read as under:
"(1) Where the total income of
an assessee, being an individual, who is a resident
and an employee of an Indian company engaged in information technology software
and information technology services (hereafter in this section referred to as
the resident employee), includes—
a) income by way of
dividends, other than dividends referred to in section 115-O, on Global
Depository Receipts of an Indian company engaged in information technology
software and information technology services, issued in accordance with such
employees' stock option scheme as the Central Government may, by notification
in the Official Gazette, specify in this behalf and purchased by him in foreign
currency; or
b) income
by way of long-term capital gains arising from the transfer of Global
Depository Receipts referred to in clause (a), the income-tax payable
shall be the aggregate of—
(i)
the amount of income-tax calculated on the income by way of dividends, other
than dividends referred to in section 115-O, in respect of Global Depository
Receipts referred to in clause (a), if any, included in the total
income, at the rate of ten per cent;
(ii) the amount of
income-tax calculated on the income by way of long-term capital gains referred
to in clause (b), if any, at the rate of ten per cent; and
(iii) the amount of income-tax with which the resident employee would have been chargeable had his total income been reduced by the amount of income referred to in clauses (a) and (b)."
[J61]Inserted by the Finance Act, 2003, w.e.f. 1-4-2004. These words were omitted by the Finance Act, 2002, w.e.f. 1-4-2003.
[J62]The Issue of Foreign Currency Convertible Bonds and Ordinary Shares (Through Depository Receipt Mechanism) Scheme, 1993 has been specified in respect of assessment year 2001-2002 and subsequent assessment years: Notification No. 348/2001, dated 12-11-2001.
[J63]Inserted by the Finance Act, 2003, w.e.f. 1-4-2004. These words were omitted by the Finance Act, 2002, w.e.f. 1-4-2003.
[J64]Ibid.
[J65]Inserted by the Finance Act, 1993, w.e.f. 1-4-1993.
[J66]See Circular No. 789, dated 13-4-2000.
[J67]Substituted by the Finance (No. 2) Act, 1998, w.e.f. 1-4-1999. It was amended by the Finance Act, 1997, w.e.f. 1-4-1998.
[J68]Inserted by the Finance Act, 2003, w.e.f. 1-4-2004. These words were inserted by the Finance Act, 1999, w.e.f. 1-4-1999 and omitted by the Finance Act, 2002, w.e.f. 1-4-2003.
[J69]Inserted by the Finance (No. 2) Act, 2004, w.e.f. 1-4-2005.
[J70]Being substituted by "fifteen per cent" by the Finance Act, 2008, w.e.f. 1-4-2009.
[J71]For a list of notified Foreign Institutional Investors, refer Notification Nos. 9474, dated 7-2-1994; 9527, dated 30-3-1994; 9710, dated 21-2-1995 and 9739, dated 31-3-1995.
[J73]Inserted by the Finance Act, 1976, w.e.f. 1-6-1976.
[J74]Inserted by the Finance Act, 1988, w.e.f 1-4-1989.
[J75]Inserted by the Finance Act, 1988, w.e.f 1-4-1989.
[J76]Substituted for "the previous year relevant to the assessment year commencing on the 1st day of April, 1989" by the Finance Act, 1989, w.e.f. 1-4-1990.
[J77]Social Security (Provision for subsidy of group insurance for the weaker and vulnerable sections of the society) Fund has been specified vide GSR 102(E), dated 16-2-1989.
[J78]Substituted for "year" by the Finance Act, 1989, w.e.f. 1-4-1990.
[J79]Inserted by the Finance Act, 1986, w.e.f. 1-4-1987.
[J80]Substituted for "forty" by the Finance Act, 2001, w.e.f. 1-4-2002.
[J81]Inserted by the Direct Tax Laws (Second Amendment) Act, 1989, w.e.f. 1-4-1990.
[J82]Inserted by the Finance Act, 2002, w.e.f. 1-4-2003.
[J83]Inserted by the Finance Act, 2006, w.e.f. 1-4-2007.