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Finance Bill 2021

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BILL No. 15 OF 2021

THE FINANCE BILL, 2021

(AS INTRODUCED IN LOK SABHA)

THE FINANCE BILL, 2021

ARRANGEMENT OF CLAUSES

CHAPTER I

PRELIMINARY

CLAUSES

Short title and commencement.

CHAPTER II

RATES OF INCOME-TAX 2. Income-tax.

CHAPTER III

DIRECT TAXES

Income-tax 3. Amendment of section 2. 4. Amendment of section 9A. 5. Amendment of section 10. 6. Amendment of section11. 7. Amendment of section 32. 8. Amendment of section 36. 9. Amendment of section 43B. 10. Amendment of section 43CA. 11. Amendment of section 44AB. 12. Amendment of section 44ADA. 13. Amendment of section 44DB. 14. Amendment of section 45. 15. Amendment of section 47. 16. Amendment of section 48. 17. Amendment of section 49. 18. Amendment of section 50. 19. Amendment of section 54GB. 20. Amendment of section 55. 21. Amendment of section 56.

CLAUSES

Amendment of section 72A.
Amendment of section 79.
Amendment of section 80EEA.
Amendment of section 80-IAC.
Amendment of section 80-IBA.
Amendment of section 80LA.
Insertion of new section 89A.
Amendment of section 112A.
Amendment of section 115AD.
Amendment of section 115JB.
Amendment of section 139.
Amendment of section 142.
Amendment of section 143.
Substitution of new section for section 147.
Substitution of new section for section 148.
Insertion of new section 148A.
Substitution of new section for section 149.

ion 143. 35. Substitution of new section for section 147. 36. Substitution of new section for section 148. 37. Insertion of new section 148A. 38. Substitution of new section for section 149. 39. Substitution of new section for section 151. 40. Amendment of section 151A. 41. Amendment of section 153. 42. Amendment of section 153A. 43. Amendment of section 153C. 44. Amendment of section 194. 45. Amendment of section 194A. 46. Amendment of section 194-IB. 47. Insertion of new section 194P. 48. Insertion of new section 194Q. 49. Amendment of section 196D. 50. Amendment of section 206AA. 51. Insertion of new section 206AB. 52. Insertion of new section 206CCA. 53. Amendment of section 234C. 54. Amendment of section 245A. 55. Insertion of new section 245AA. 56. Amendment of section 245B 57. Amendment of section 245BC. 58. Amendment of section 245BD. 59. Amendment of section 245C. 60. Amendment of section 245D. 61. Amendment of section 245DD. 62. Amendment of section 245F.

45B 57. Amendment of section 245BC. 58. Amendment of section 245BD. 59. Amendment of section 245C. 60. Amendment of section 245D. 61. Amendment of section 245DD. 62. Amendment of section 245F.

iii

CLAUSES

Amendment of section 245G.
Amendment of section 245H.
Insertion of new section 245M.
Insertion of new Chapter XIX-AA.
Amendment of section 245N.
Amendment of section 245-O.
Insertion of new section 245-OB.
Amendment of section 245P.
Amendment of section 245Q.
Amendment of section 245R.
Amendment of section 245S.
Amendment of section 245T.
Amendment of section 245U.
Amendment of section 245V.
Insertion of new section 245W.
Amendment of section 255.
Amendment of section 281B.

CHAPTER IV

INDIRECT TAXES

Customs 80. Amendment of section 2. 81. Amendment of section 5. 82. Amendment of section 25. 83. Insertion of new section 28BB. 84. Amendment of section 46. 85. Amendment of section 110. 86. Amendment of section 113. 87. Insertion of new section 114AC. 88. Amendment of section 139. 89. Amendment of section 149. 90. Amendment of section 153. 91. Insertion of new section 154C.

Customs Tariff

Amendment of section 8B. 93. Amendment of section 9. 94. Amendment of section 9A. 95. Amendment of First Schedule.

of section 153. 91. Insertion of new section 154C.

Customs Tariff

Amendment of section 8B. 93. Amendment of section 9. 94. Amendment of section 9A. 95. Amendment of First Schedule.

CLAUSES Excise

Amendment of Fourth Schedule. 97. Amendment of Chapter 27 of Fourth Schedule. 98. Revised date of effect to amendments made in Fourth Schedule vide notification issued under section 3C of Central Excise Act, 1944.

Central Goods and Service Tax

Amendment of section 7.
Amendment of section 16.
Amendment of section 35.
Substitution of new section for section 44.
Amendment of section 50.
Amendment of section 74.
Amendment of section 75.
Amendment of section 83.
Amendment of section 107.
Amendment of section 129.
Amendment of section 130.
Substitution of new section for section 151.
Amendment of section 152.
Amendment of section 168.
Amendment of Schedule II.

Integrated Goods and Services Tax

Amendment of section 16.

CHAPTER V

AGRICULTURE INFRASTRUCTURE AND DEVELOPMENT CESS

Agriculture Infrastructure and Development Cess on imported goods.
Agriculture Infrastructure and Development Cess on excisable goods.

CHAPTER VI

MISCELLANEOUS

PART I AMENDMENT TO THE INDIAN STAMP ACT, 1899

re and Development Cess on imported goods. 116. Agriculture Infrastructure and Development Cess on excisable goods.

CHAPTER VI

MISCELLANEOUS

PART I AMENDMENT TO THE INDIAN STAMP ACT, 1899

CLAUSES

Insertion of new section 8G.

PART II AMENDMENT TO THE CONTINGENCY FUND OF INDIA ACT, 1950

Amendment of Act 49 of 1950.

PART III AMENDMENTS TO THE LIFE INSURANCE CORPORATION ACT, 1956

Commencement of this Part.
Amendment of section 2.
Substitution of section 4.
Substitution of section 5.
Substitution of section 19.
Substitution of section 20.
Amendment of section 22.
Insertion of new section 23A.
Substitution of section 24.
Substitution of section 25.
Amendment of section 26.
Amendment of section 27.
Amendment of section 28.
Amendment of section 28A.
Insertion of new sections 28B and 28C.
Substitution of sections 46 and 47.
Amendment of section 48.
Amendment of section 49.
Insertion of sections 50 and 51.

PART IV AMENDMENTS TO THE SECURITIES CONTRACTS (REGULATION) ACT, 1956

Commencement of this Part.
Amendment of section 2.
Insertion of new section 30B.

ctions 50 and 51.

PART IV AMENDMENTS TO THE SECURITIES CONTRACTS (REGULATION) ACT, 1956

Commencement of this Part.
Amendment of section 2.
Insertion of new section 30B.

PART V AMENDMENT TO THE CENTRAL SALES TAX ACT, 1956 CLAUSES

Amendment of Act 74 of 1956.

PART VI AMENDMENTS TO THE PROHIBITION OF BENAMI PROPERTY TRANSACTION ACT, 1988

Commencement of this Part.
Amendment of section 2.
Substitution of section 7.
Omission of sections 8 to 17.
Amendment of section 26.
Amendment of section 68. PART VII AMENDMENT TO THE SECURITIES AND EXCHANGE BOARD OF INDIA ACT, 1992
Amendment of Act 15 of 1992.

PART VIII AMENDMENT TO THE RECOVERY OF DEBTS DUE TO BANKS AND FINANCIAL INSTITUTIONS ACT, 1993

Amendment of Act 51 of 1993.

PART IX AMENDMENT TO THE FINANCE ACT, 2001

Amendment of Seventh Schedule.

PART X AMENDMENT TO THE SECURITISATION AND RECONSTRUCTION OF FINANCIAL ASSETS AND ENFORCEMENT OF SECURITY INTEREST ACT, 2002

Amendment of Act 54 of 2002.

nt of Seventh Schedule.

PART X AMENDMENT TO THE SECURITISATION AND RECONSTRUCTION OF FINANCIAL ASSETS AND ENFORCEMENT OF SECURITY INTEREST ACT, 2002

Amendment of Act 54 of 2002.

vii

PART XI AMENDMENTS TO THE INDUSTRIAL DEVELOPMENT BANK (TRANSFER OF UNDERTAKING AND REPEAL) ACT, 2003 CLAUSES

Commencement of this Part.
Amendment of section 3. PART XII AMENDMENTS TO THE FINANCE (NO.2) ACT, 2004
Commencement of this Part.
Amendment of section 97.
Amendment of section 98.
Amendment of section 100.
Amendment of section 101. PART XIII AMENDMENT TO THE FINANCE ACT, 2016
Amendment of Act 28 of 2016.

PART XIV AMENDMENT TO THE DIRECT TAX VIVAD SE VISHWAS ACT, 2020

Amendment of Act 3 of 2020.

THE FIRST SCHEDULE. THE SECOND SCHEDULE. THE THIRD SCHEDULE. THE FOURTH SCHEDULE. THE FIFTH SCHEDULE. THE SIXTH SCHEDULE. THE SEVENTH SCHEDULE.

AS INTRODUCED IN LOK SABHA ON 1ST FEBRUARY, 2021

Bill No. 15 of 2021

THE FINANCE BILL, 2021

BILL

to give effect to the financial proposals of the Central Government for the financial year 2021-2022.

BE it enacted by Parliament in the Seventy-second Year of the Republic of India as follows:––

CHAPTER I

PRELIMINARY

Short title and commencement.

(1) This Act may be called the Finance Act, 2021.

y Parliament in the Seventy-second Year of the Republic of India as follows:––

CHAPTER I

PRELIMINARY

Short title and commencement.

(1) This Act may be called the Finance Act, 2021.

(2) Save as otherwise provided in this Act,––

(a) sections 2 to 79 shall come into force on the 1st day of April, 2021;

(b) sections 99 to 114 shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint.

CHAPTER II

RATES OF INCOME-TAX

Income-tax. 2. (1) Subject to the provisions of sub-sections (2) and (3), for the assessment year commencing on the 1st day of April, 2021, income-tax shall be charged at the rates specified in Part I of the First Schedule and such tax shall be increased by a surcharge, for the purposes of the Union, calculated in each case in the manner provided therein.

(2) In the cases to which Paragraph A of Part I of the First Schedule applies, where the assessee has, in the previous year,

the Union, calculated in each case in the manner provided therein.

(2) In the cases to which Paragraph A of Part I of the First Schedule applies, where the assessee has, in the previous year,

any net agricultural income exceeding five thousand rupees, in addition to total income, and the total income exceeds two lakh fifty thousand rupees, then,—

(a) the net agricultural income shall be taken into account, in the manner provided in clause (b) [that is to say, as if the net agricultural income were comprised in the total income after the first two lakh fifty thousand rupees of the total income but without being liable to tax], only for the purpose of charging income-tax in respect of the total income; and

(b) the income-tax chargeable shall be calculated as follows:—

(i) the total income and the net agricultural income shall be aggregated and the amount of income-tax shall be determined in respect of the aggregate income at the rates specified in the said Paragraph A, as if such aggregate income were the total income;

(ii) the net agricultural income shall be increased by a sum of two lakh fifty thousand rupees, and the amount of income-tax shall be determined in respect of the net agricultural income as so increased at the rates specified in the said Paragraph A, as if the net agricultural income as so increased were the total income;

ll be determined in respect of the net agricultural income as so increased at the rates specified in the said Paragraph A, as if the net agricultural income as so increased were the total income;

(iii) the amount of income-tax determined in accordance with sub-clause (i) shall be reduced by the amount of income-tax determined in accordance with sub-clause (ii) and the sum so arrived at shall be the income-tax in respect of the total income:

Provided that in the case of every individual, being a resident in India, who is of the age of sixty years or more but less than eighty years at any time during the previous year, referred to in item (II) of Paragraph A of Part I of the First Schedule, the provisions of this sub-section shall have effect as if for the words “two lakh fifty thousand rupees”, the words “three lakh rupees” had been substituted:

Provided further that in the case of every individual, being a resident in India, who is of the age of eighty years or more at any time during the

rds “three lakh rupees” had been substituted:

Provided further that in the case of every individual, being a resident in India, who is of the age of eighty years or more at any time during the

previous year, referred to in item (III) of Paragraph A of Part I of the First Schedule, the provisions of this sub-section shall have effect as if for the words “two lakh fifty thousand rupees”, the words “five lakh rupees” had been substituted.

(3) In cases to which the provisions of Chapter XII or Chapter XII-A or section 115JB or section 115JC or Chapter XII-FA or Chapter XII-FB or sub-section (1A) of section 161 or section 164 or section 164A or section 167B of the Income-tax Act, 1961 (hereinafter referred to as the Income-tax Act) apply, the tax chargeable shall be determined as provided in that Chapter or that section, and with reference to the rates imposed by sub-section (1) or the rates as specified in that Chapter or section, as the case may be:

Provided that the amount of income-tax computed in accordance with the provisions of section 111A or section 112 or section 112A of the Income-tax Act shall be increased by a surcharge, for the purposes of the Union, as provided in Paragraph A, B, C, D or E, as the case may be, of Part I of the First Schedule, except in case of a domestic company whose income is chargeable to tax under section 115BAA or section 115BAB of the Income-tax Act or in case of cooperative society whose income is chargeable to tax under section 115BAD of the Income-tax Act:

is chargeable to tax under section 115BAA or section 115BAB of the Income-tax Act or in case of cooperative society whose income is chargeable to tax under section 115BAD of the Income-tax Act:

Provided further that in respect of any income chargeable to tax under section 115A, 115AB, 115AC, 115ACA, 115AD, 115B, 115BA, 115BB, 115BBA, 115BBC, 115BBD, 115BBF, 115BBG, 115E, 115JB or 115JC of the Income-tax Act, the amount of income-tax computed under this sub-section shall be increased by a surcharge, for the purposes of the Union, calculated,—

(a) in the case of every individual or Hindu undivided family or association of persons or body of individuals, whether incorporated or not, or every artificial juridical person referred to in sub-clause (vii) of clause (31) of section 2 of the Income-tax Act, not having any income under section 115AD of the Income-tax Act,—

(i) having a total income exceeding fifty lakh rupees but not exceeding one crore rupees, at the rate of ten per cent. of such income-tax;

(ii) having a total income exceeding one crore rupees, but not exceeding two crore rupees, at the rate of fifteen per cent. of such income-tax;

43 of 1961.

come-tax;

(ii) having a total income exceeding one crore rupees, but not exceeding two crore rupees, at the rate of fifteen per cent. of such income-tax;

43 of 1961.

(iii) having a total income exceeding two crore rupees, but not exceeding five crore rupees, at the rate of twenty-five per cent. of such income-tax; and

(iv) having a total income exceeding five crore rupees, at the rate of thirty-seven per cent. of such income-tax;

(aa) in the case of individual or every association of person or body of individuals, whether incorporated or not, or every artificial juridical person referred to in sub-clause (vii) of clause (31) of section 2 of the Income-tax Act, having income under section 115AD of the Income-tax Act,––

(i) having a total income exceeding fifty lakh rupees but not exceeding one crore rupees, at the rate of ten per cent. of such income-tax;

(ii) having a total income exceeding one crore rupees, but not exceeding two crore rupees, at the rate of fifteen per cent. of such income-tax;

(iii) having a total income [excluding the income by way of dividend or income of the nature referred to in clause (b) of sub-section (1) of section 115AD of the Income-tax Act] exceeding two crore rupees but not exceeding five crore rupees, at the rate of twenty-five per cent.

he nature referred to in clause (b) of sub-section (1) of section 115AD of the Income-tax Act] exceeding two crore rupees but not exceeding five crore rupees, at the rate of twenty-five per cent. of such income-tax;

(iv) having a total income [excluding the income by way of dividend or income of the nature referred to in clause (b) of sub-section (1) of section 115AD of the Income-tax Act] exceeding five crore rupees, at the rate of thirty-seven per cent. of such income-tax; and

(v) having a total income [including the income by way of dividend or income of the nature referred to in clause (b) of sub-section (1) of section 115AD of the Income-tax Act] exceeding two crore rupees, but is not covered in sub-clauses (iii) and (iv), at the rate of fifteen per cent. of such income-tax:

Provided that in case where the total income includes any income by way of dividend or income chargeable under clause (b) of sub-section (1) of

he rate of fifteen per cent. of such income-tax:

Provided that in case where the total income includes any income by way of dividend or income chargeable under clause (b) of sub-section (1) of

section 115AD of the Income-tax Act, the rate of surcharge on the income-tax calculated on that part of income shall not exceed fifteen per cent.;

(b) in the case of every co-operative society except a co-operative society whose income is chargeable to tax under section 115BAD of the Income-tax Act or firm or local authority, at the rate of twelve per cent. of such income-tax, where the total income exceeds one crore rupees;

(c) in the case of every domestic company except such domestic company whose income is chargeable to tax under section 115BAA or section 115BAB of the Income-tax Act,—

(i) at the rate of seven per cent. of such income-tax, where the total income exceeds one crore rupees but does not exceed ten crore rupees;

(ii) at the rate of twelve per cent. of such income-tax, where the total income exceeds ten crore rupees;

(d) in the case of every company, other than a domestic company,—

(i) at the rate of two per cent. of such income- tax, where the total income exceeds one crore rupees but does not exceed ten crore rupees;

(ii) at the rate of five per cent.

mestic company,—

(i) at the rate of two per cent. of such income- tax, where the total income exceeds one crore rupees but does not exceed ten crore rupees;

(ii) at the rate of five per cent. of such income- tax, where the total income exceeds ten crore rupees:

Provided also that in the case of persons mentioned in (a) and (aa) above, having total income chargeable to tax under section 115JC of the Income-tax Act, and such income exceeds,—

(i) fifty lakh rupees but does not exceed one crore rupees, the total amount payable as income-tax and surcharge thereon shall not exceed the total amount payable as income-tax on a total income of fifty lakh rupees by more than the amount of income that exceeds fifty lakh rupees;

(ii) one crore rupees but not exceed two crore rupees, the total amount payable as income-tax and surcharge thereon shall not exceed the total amount payable as income-tax and surcharge on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees;

(iii) two crore rupees but not exceed five crore rupees, the total amount payable as income-tax and surcharge thereon shall not exceed the total amount payable as income-tax and surcharge on a total income of two crore rupees by more than the amount of income that exceeds two crore rupees;

nd surcharge thereon shall not exceed the total amount payable as income-tax and surcharge on a total income of two crore rupees by more than the amount of income that exceeds two crore rupees;

(iv) five crore rupees, the total amount payable as income-tax and surcharge thereon shall not exceed the total amount payable as income-tax and surcharge on a total income of five crore rupees by more than the amount of income that exceeds five crore rupees:

Provided also that in the case of persons mentioned in (b) above, having total income chargeable to tax under section 115JC of the Income-tax Act, and such income exceeds one crore rupees, the total amount payable as income-tax on such income and surcharge thereon shall not exceed the total amount payable as income-tax on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees:

section 115JB of the Income-tax Act, and such income exceeds one crore rupees but does not exceed ten crore rupees, the total amount payable as income-tax on such income and surcharge thereon,

shall not exceed the total amount payable as income-tax on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees:

Provided also that in the case of every company having total income chargeable to tax under section 115JB of the Income-tax Act, and such income exceeds ten crore rupees, the total amount payable as income-tax on such income and surcharge thereon, shall not exceed the total amount payable as income-tax and surcharge on a total income of ten crore rupees by more than the amount of income that exceeds ten crore rupees:

Provided also that in respect of any income chargeable to tax under clause (i) of sub-section (1) of section 115BBE of the Income-tax Act, the amount of income-tax computed under this sub-section shall be increased by a surcharge, for the purposes of the Union, calculated at the rate of twenty-five per cent. of such income-tax:

Provided also that in case of every domestic company whose income is chargeable to tax under section 115BAA or section 115BAB of the Income-tax Act, the income-tax computed under this sub-section shall be increased by a surcharge, for the purposes of the Union, calculated at the rate of ten per cent.

section 115BAB of the Income-tax Act, the income-tax computed under this sub-section shall be increased by a surcharge, for the purposes of the Union, calculated at the rate of ten per cent. of such income-tax:

Provided also that in case of every individual or Hindu undivided family, whose income is chargeable to tax under section 115BAC of the Income- tax, the income-tax computed under this sub-section shall be increased by a surcharge, for the purposes of the Union, as provided in Paragraph A of Part I of the First Schedule:

Provided also that in case of every resident co-operative society, whose income is chargeable to tax under section 115BAD of the Income-tax Act, the income tax computed under this sub-section shall be increased by a surcharge, for the purposes of the Union, calculated at the rate of ten per cent. of such “advance tax”.

(4) In cases in which tax has to be charged and paid under sub-section (2A) of section 92CE or section 115QA or section 115TA or section 115TD of the Income-tax Act, the tax shall be charged and paid at the rates as specified in those sections and shall be increased by a surcharge, for the purposes of the Union, calculated at the rate of twelve per cent. of such tax.

shall be charged and paid at the rates as specified in those sections and shall be increased by a surcharge, for the purposes of the Union, calculated at the rate of twelve per cent. of such tax.

(5) In cases in which tax has to be deducted under sections 193, 194A, 194B, 194BB, 194D, 194LBA, 194LBB, 194LBC and 195 of the Income-tax Act, at the rates in force, the deductions shall be made at the rates specified in Part II of the First Schedule and shall be increased by a surcharge, for the purposes of the Union, calculated in cases wherever prescribed, in the manner provided therein.

(6) In cases in which tax has to be deducted under sections 192A, 194, 194C, 194DA, 194E, 194EE, 194F, 194G, 194H, 194-I, 194-IA, 194-IB, 194-IC, 194J, 194LA, 194LB, 194LBA, 194LBB, 194LBC, 194LC, 194LD, 194K, 194M, 194N, 194-O, 194Q, 196A, 196B, 196C and 196D of the Income-tax Act, the deductions shall be made at the rates specified in those sections and shall be increased by a surcharge, for the purposes of the Union,—

(a) in the case of every individual or Hindu undivided family or association of persons or body of individuals, whether incorporated or not, or every artificial juridical person referred to in sub-clause (vii) of clause (31) of section 2 of the Income-tax Act, being a non-resident except in case of deduction on income by way of dividend under section 196D of the Income-tax Act, calculated,—

(i) at the rate of ten per cent.

ion 2 of the Income-tax Act, being a non-resident except in case of deduction on income by way of dividend under section 196D of the Income-tax Act, calculated,—

(i) at the rate of ten per cent. of such tax, where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds fifty lakh rupees but does not exceed one crore rupees;

(ii) at the rate of fifteen per cent. of such tax, where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds one crore rupees but does not exceed two crore rupees;

(iii) at the rate of twenty-five per cent. of such tax, where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds two crore rupees but does not exceed five crore rupees;

(iv) at the rate of thirty-seven per cent. of such tax, where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds five crore rupees;

(aa) in the case of every individual or Hindu undivided family or association of persons or body of individuals, whether incorporated or not, or every artificial juridical person referred to in sub-clause (vii) of clause (31) of section 2 of the Income- tax Act, being a non-resident, in case of deduction on income by way of dividend under section 196D of that Act, calculated,—

(i) at the rate of ten per cent.

e (31) of section 2 of the Income- tax Act, being a non-resident, in case of deduction on income by way of dividend under section 196D of that Act, calculated,—

(ii) at the rate of fifteen per cent. of such tax, where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds one crore rupees;

(b) in the case of every co-operative society or firm, being a non-resident, calculated at the rate of twelve per cent. of such tax, where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds one crore rupees;

(i) at the rate of two per cent. of such tax, where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds one crore rupees but does not exceed ten crore rupees;

two per cent. of such tax, where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds one crore rupees but does not exceed ten crore rupees;

(ii) at the rate of five per cent. of such tax, where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds ten crore rupees.

(7) In cases in which tax has to be collected under the proviso to section 194B of the Income-tax Act, the collection shall be made at the rates specified in Part II of the First Schedule, and shall be increased by a surcharge, for the purposes of the Union, calculated, in cases wherever prescribed, in the manner provided therein.

(8) In cases in which tax has to be collected under section 206C of the Income-tax Act, the collection shall be made at the rates specified in that section and shall be increased by a surcharge, for the purposes of the Union,—

(i) at the rate of ten per cent. of such tax, where the amount or the aggregate of such amounts collected on likely to be collected and subject to the collection exceeds fifty lakh rupees but does not exceed one crore rupees;

(ii) at the rate of fifteen per cent.

aggregate of such amounts collected on likely to be collected and subject to the collection exceeds fifty lakh rupees but does not exceed one crore rupees;

(ii) at the rate of fifteen per cent. of such tax, where the amount or the aggregate of such amounts collected on likely to be collected and subject to the collection exceeds one crore rupees but does not exceed two crore rupees;

(iii) at the rate of twenty-five per cent. of such tax, where the income or the aggregate of such amounts collected on likely to be collected and subject to the collection exceeds two crore rupees but does not exceed five crore rupees;

(iv) at the rate of thirty-seven per cent. of such tax, where the income or the aggregate of such amounts collected on likely to be collected and subject to the collection exceeds five crore rupees.

(b) in the case of every co-operative society or firm, being a non-resident, calculated at the rate of twelve per cent. of such tax, where the amount or the aggregate of such

five crore rupees.

(b) in the case of every co-operative society or firm, being a non-resident, calculated at the rate of twelve per cent. of such tax, where the amount or the aggregate of such

amounts collected on likely to be collected and subject to the collection exceeds one crore rupees;

(i) at the rate of two per cent. of such tax, where the amount or the aggregate of such amounts collected on likely to be collected and subject to the collection exceeds one crore rupees but does not exceed ten crore rupees;

(ii) at the rate of five per cent. of such tax, where the amount or the aggregate of such amounts collected on likely to be collected and subject to the collection exceeds ten crore rupees.

(9) Subject to the provisions of sub-section (10), in cases in which income-tax has to be charged under sub-section (4) of section 172 or sub-section (2) of section 174 or section 174A or section 175 or sub-section (2) of section 176 of the Income-tax Act or deducted from, or paid on, income chargeable under the head “Salaries” under section 192 of the said Act or deducted under section 194P of the said Act or in which the “advance tax” payable under Chapter XVII-C of the said Act has to be computed at the rate or rates in force, such income-tax or, as the case may be, “advance tax” shall be charged, deducted or computed at the rate or rates specified in Part III of the First Schedule and such tax shall be increased by a surcharge, for the purposes of the

y be, “advance tax” shall be charged, deducted or computed at the rate or rates specified in Part III of the First Schedule and such tax shall be increased by a surcharge, for the purposes of the Union, calculated in such cases and in such manner as provided therein:

Provided that in cases to which the provisions of Chapter XII or Chapter XII-A or section 115JB or section 115JC or Chapter XII-FA or Chapter XII-FB or sub-section (1A) of section 161 or section 164 or section 164A or section 167B of the Income-tax Act apply, “advance tax” shall be computed with reference to the rates imposed by this sub-section or the rates as specified in that Chapter or section, as the case may be:

Provided further that the amount of “advance tax” computed in accordance with the provisions of section 111A or section 112 or 112A of the Income-tax Act shall be increased by a surcharge, for the purposes of the Union, as provided in Paragraph A, B, C, D or E, as the case may be, of Part III of the First Schedule except in case of a domestic company whose income is chargeable to tax under section 115BAA or section 115BAB of the Income-tax Act or in case of a resident co- operative society whose income is chargeable to tax under section 115BAD of the Income-tax Act:

ble to tax under section 115BAA or section 115BAB of the Income-tax Act or in case of a resident co- operative society whose income is chargeable to tax under section 115BAD of the Income-tax Act:

Provided also that in respect of any income chargeable to tax under section 115A, 115AB, 115AC, 115ACA, 115AD, 115B, 115BA, 115BB, 115BBA, 115BBC, 115BBD, 115BBF, 115BBG, 115E, 115JB or 115JC of the Income-tax Act, “advance tax” computed under the first proviso shall be increased by a surcharge, for the purposes of the Union, calculated,—

(i) at the rate of ten per cent. of such “advance tax”, where the total income exceeds fifty lakh rupees but does not exceed one crore rupees;

(ii) at the rate of fifteen per cent. of such “advance tax”, where the total income exceeds one crore rupees but does not exceed two crore rupees;

(iii) at the rate of twenty-five per cent. of such “advance tax”, where the total income exceeds two crore rupees but does not exceed five crore rupees;

(iv) at the rate of thirty-seven per cent.

iii) at the rate of twenty-five per cent. of such “advance tax”, where the total income exceeds two crore rupees but does not exceed five crore rupees;

(iv) at the rate of thirty-seven per cent. of such “advance tax”, where the total income exceeds five crore rupees;

(aa) in the case of individual or every association of persons or body of individuals, whether incorporated or not, or every artificial juridical person referred to in sub- clause (vii) of clause (31) of section 2 of the Income-tax Act, having income under section 115AD of the Income- tax Act,—

(i) at the rate of ten per cent. of such “advance tax”, where the total income exceeds fifty lakh rupees, but does not exceed one crore rupees;

(ii) at the rate of fifteen per cent. of such “advance tax”, where the total income exceeds one crore rupees but does not exceed two crore rupees;

(iii) at the rate of twenty-five per cent. of such “advance tax”, where the total income [excluding the income by way of dividend or income of the nature referred to in clause (b) of sub-section (1) of section

ate of twenty-five per cent. of such “advance tax”, where the total income [excluding the income by way of dividend or income of the nature referred to in clause (b) of sub-section (1) of section

115AD of the Income-tax Act] exceeds two crore rupees but does not exceed five crore rupees;

(iv) at the rate of thirty-seven per cent. of such “advance tax”, where the total income [excluding the income by way of dividend or income of the nature referred to in clause (b) of sub-section (1) of section 115AD of the Income-tax Act] exceeds five crore rupees;

(v) at the rate of fifteen per cent. of such “advance tax”, where the total income [including the income by way of dividend or income of the nature referred to in clause (b) of sub-section (1) of section 115AD of the Income-tax Act] exceeds two crore rupees but is not covered in sub-clauses (iii) and (iv):

Provided that in case where the total income includes any income by way of dividend or income chargeable under clause (b) of sub-section (1) of section 115AD of the Income-tax Act, the rate of surcharge on the advance tax calculated on that part of income shall not exceed fifteen per cent.;

(b) in the case of every co-operative society except such co-operative society whose income is chargeable to tax under section 115BAD of the Income-tax Act or firm or local authority at the rate of twelve per cent.

every co-operative society except such co-operative society whose income is chargeable to tax under section 115BAD of the Income-tax Act or firm or local authority at the rate of twelve per cent. of such “advance tax”, where the total income exceeds one crore rupees;

(c) in the case of every domestic company except such domestic company whose income is chargeable to tax under section 115BAA or section 115BAB of the Income-tax Act,—

(i) at the rate of seven per cent. of such “advance tax”, where the total income exceeds one crore rupees but does not exceed ten crore rupees;

(ii) at the rate of twelve per cent. of such “advance tax”, where the total income exceeds ten crore rupees;

(d) in the case of every company, other than a domestic company,—

(i) at the rate of two per cent. of such “advance tax”, where the total income exceeds one crore rupees but does not exceed ten crore rupees;

(ii) at the rate of five per cent.

company,—

(i) at the rate of two per cent. of such “advance tax”, where the total income exceeds one crore rupees but does not exceed ten crore rupees;

(ii) at the rate of five per cent. of such “advance tax”, where the total income exceeds ten crore rupees:

Provided also that in the case of persons mentioned in (a) and (aa) above, having total income chargeable to tax under section 115JC of the Income-tax Act, and such income exceeds,—

(a) fifty lakh rupees but does not exceed one crore rupees, the total amount payable as “advance tax” on such income and surcharge thereon shall not exceed the total amount payable as “advance tax” on a total income of fifty lakh rupees by more than the amount of income that exceeds fifty lakh rupees;

(b) one crore rupees but does not exceed two crore rupees, the total amount payable as “advance tax” on such income and surcharge thereon shall not exceed the total amount payable as “advance tax” on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees;

(c) two crore rupees but does not exceed five crore rupees, the total amount payable as “advance tax” on such income and surcharge thereon shall not exceed the total amount payable as “advance tax” on a total income of two crore rupees by more than the amount of income that exceeds two crore rupees;

such income and surcharge thereon shall not exceed the total amount payable as “advance tax” on a total income of two crore rupees by more than the amount of income that exceeds two crore rupees;

(d) five crore rupees, the total amount payable as “advance tax” on such income and surcharge thereon shall not exceed the total amount payable as “advance tax” on a total income of five crore rupees by more than the amount of income that exceeds five crore rupees:

Provided also that in the case of persons mentioned in (b) above, having total income chargeable to tax under section 115JC of the Income-tax Act, and such income exceeds one crore rupees, the total amount payable as “advance tax” on such income and surcharge thereon shall not exceed the total amount payable as “advance tax” on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees:

Provided also that in the case of every company having total income chargeable to tax under section 115JB of the Income-tax Act, and such income exceeds one crore rupees but does not exceed ten crore rupees, the total amount payable as “advance tax” on such income and surcharge thereon, shall not exceed the total amount payable as “advance tax” on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees:

uch income and surcharge thereon, shall not exceed the total amount payable as “advance tax” on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees:

Provided also that in the case of every company having total income chargeable to tax under section 115JB of the Income-tax Act, and such income exceeds ten crore rupees, the total amount payable as “advance tax” on such income and surcharge thereon, shall not exceed the total amount payable as “advance tax” and surcharge on a total income of ten crore rupees by more than the amount of income that exceeds ten crore rupees:

Provided also that in respect of any income chargeable to tax under clause (i) of sub-section (1) of section 115BBE of the Income-tax Act, the “advance tax” computed under the first proviso shall be increased by a surcharge, for the purposes of the Union, calculated at the rate of twenty-five per cent. of such “advance tax”;

Provided also that in case of every domestic company whose income is chargeable to tax under section 115BAA or section 115BAB of the Income-tax Act, the advance tax computed under the first proviso shall be increased by a surcharge, for the purposes of the Union, calculated at the rate of ten per cent.

or section 115BAB of the Income-tax Act, the advance tax computed under the first proviso shall be increased by a surcharge, for the purposes of the Union, calculated at the rate of ten per cent. of such “advance tax”:

Provided also that in case of every individual or Hindu undivided family, whose income is chargeable to tax under section 115BAC of the Income-tax Act, the advance tax computed under the first proviso shall be increased by a surcharge, for the purposes of the Union, as provided in Paragraph A of Part III of the First Schedule.

Provided also that in case of every resident co-operative society whose income is chargeable to tax under section 115BAD of the Income-tax Act, the advance tax computed under the first proviso shall be increased by a surcharge, for the purposes of the Union, calculated at the rate of ten per cent. of such “advance tax”:

(10) In cases to which Paragraph A of Part III of the First Schedule applies, where the assessee has, in the previous year or, if by virtue of any provision of the Income-tax Act, income-tax is to be charged in respect of the income of a period other than the previous year, in such other period, any net agricultural income exceeding five thousand rupees, in addition to total income and the total income exceeds two lakh fifty thousand rupees, then, in charging income-tax under sub-section (2) of section 174 or section 174A or section 175 or sub-section (2) of section 176 of the said Act or in computing the “advance tax” payable under

then, in charging income-tax under sub-section (2) of section 174 or section 174A or section 175 or sub-section (2) of section 176 of the said Act or in computing the “advance tax” payable under Chapter XVII-C of the said Act, at the rate or rates in force,—

(b) such income-tax or, as the case may be, “advance tax” shall be so charged or computed as follows:—

(i) the total income and the net agricultural income shall be aggregated and the amount of income-tax or “advance tax” shall be determined in respect of the aggregate income at the rates specified in the said Paragraph A, as if such aggregate income were the total income;

(ii) the net agricultural income shall be increased by a sum of two lakh fifty thousand rupees, and the amount of income-tax or “advance tax” shall be determined in respect of the net agricultural income as so increased at the rates specified in the said Paragraph A, as if the net agricultural income were the total income;

advance tax” shall be determined in respect of the net agricultural income as so increased at the rates specified in the said Paragraph A, as if the net agricultural income were the total income;

(iii) the amount of income-tax or “advance tax” determined in accordance with sub-clause (i) shall be reduced by the amount of income-tax or, as the case may be, “advance tax” determined in accordance with sub-clause (ii) and the sum so arrived at shall be the income-tax or, as the case may be, “advance tax” in respect of the total income:

Provided that in the case of every individual, being a resident in India, who is of the age of sixty years or more but less than eighty years at any time during the previous year, referred to in item (II) of Paragraph A of Part III of the First Schedule, the provisions of this sub-section shall have effect as if for the words “two lakh fifty thousand rupees”, the words “three lakh rupees” had been substituted:

Provided further that in the case of every individual, being a resident in India, who is of the age of eighty years or more at any time during the previous year, referred to in item (III) of Paragraph A of Part III of the First Schedule, the provisions of this sub-section shall have effect as if for the words “two lakh fifty thousand rupees”, the words “five lakh rupees” had been substituted:

A of Part III of the First Schedule, the provisions of this sub-section shall have effect as if for the words “two lakh fifty thousand rupees”, the words “five lakh rupees” had been substituted:

Provided also that the amount of income-tax or “advance tax” so arrived at, shall be increased by a surcharge for the purposes of the Union, calculated in each case, in the manner provided therein.

(11) The amount of income-tax as specified in sub-sections (1) to (3) and as increased by the applicable surcharge, for the purposes of the Union, calculated in the manner provided therein, shall be further increased by an additional surcharge, for the purposes of the Union, to be called the “Health and Education Cess on income-tax”, calculated at the rate of four per cent. of such income-tax and surcharge so as to fulfil the commitment of the Government to provide and finance quality health services and universalised quality basic education and secondary and higher education.

(12) The amount of income-tax as specified in sub-sections (4) to (10) and as increased by the applicable surcharge, for the purposes of the Union, calculated in the manner provided therein, shall be further increased by an additional surcharge, for the purposes of the Union, to be called the “Health and Education Cess on income-tax”, calculated at the rate of four per cent.

therein, shall be further increased by an additional surcharge, for the purposes of the Union, to be called the “Health and Education Cess on income-tax”, calculated at the rate of four per cent. of such income-tax and surcharge so as to fulfil the commitment of the Government to provide and finance quality health services and universalised quality basic education and secondary and higher education:

Provided that nothing contained in this sub-section shall apply to cases in which tax is to be deducted or collected under the sections of the Income-tax Act mentioned in sub-sections (5), (6), (7) and (8), if the income subjected to deduction of tax at source or collection of tax at source is paid to a domestic company and any other person who is resident in India.

(13) For the purposes of this section and the First Schedule,—

(a) “domestic company” means an Indian company or any other company which, in respect of its income liable to income-tax under the Income-tax Act, for the assessment year commencing on the 1st day of April, 2018, has made the prescribed arrangements for the declaration and payment within India of the dividends (including dividends on preference shares) payable out of such income;

(b) “insurance commission” means any remuneration or reward, whether by way of commission or otherwise, for soliciting or procuring insurance business (including business relating to the continuance, renewal or revival of policies of insurance);

r reward, whether by way of commission or otherwise, for soliciting or procuring insurance business (including business relating to the continuance, renewal or revival of policies of insurance);

(c) “net agricultural income” in relation to a person, means the total amount of agricultural income, from whatever source derived, of that person computed in accordance with the rules contained in Part IV of the First Schedule;

(d) all other words and expressions used in this section and the First Schedule but not defined in this sub-section and defined in the Income-tax Act shall have the meanings, respectively, assigned to them in that Act.

CHAPTER III

DIRECT TAXES

Income-tax

Amendment of section 2.

In section 2 of the Income-tax Act,––

(i) in clause (11), in sub-clause (b), after the words “or commercial rights of similar nature,”, the words “not being goodwill of a business or profession,” shall be inserted;

(ii) in clause (14), after sub-clause (b), the following sub- clause shall be inserted, namely:––

“(c) any unit linked insurance policy to which exemption under clause (10D) of section 10 does not apply on account of the applicability of the fourth and fifth proviso thereof;”;

namely:––

“(c) any unit linked insurance policy to which exemption under clause (10D) of section 10 does not apply on account of the applicability of the fourth and fifth proviso thereof;”;

(iii) in clause (19AA), after Explanation 5, the following Explanation shall be inserted, namely:––

“Explanation 6.–– For the purposes of this clause, the reconstruction or splitting up of a public sector company into separate companies shall be deemed to be a demerger, if such reconstruction or splitting up has been made to transfer any asset of the demerged company to the resulting company and the resulting company––

(i) is a public sector company on the appointed day indicated in such scheme, as may be approved by the Central Government or any other body authorised under the provisions of the Companies Act, 2013 or any other law for the time being in force governing such public sector companies in this behalf; and

18 of 2013.

other body authorised under the provisions of the Companies Act, 2013 or any other law for the time being in force governing such public sector companies in this behalf; and

18 of 2013.

(ii) fulfils such other conditions as may be notified by the Central Government in the Official Gazette in this behalf;”;

(iv) clause (29A) shall be renumbered as clause (29AA) thereof and before clause (29AA) as so renumbered, the following clause shall be inserted, namely:––

‘(29A) “liable to tax”, in relation to a person, means that there is a liability of tax on such person under any law for the time being in force in any country, and shall include a case where subsequent to imposition of tax liability, an exemption has been provided;’;

(v) in clause (42C),──

(I) for the words “undertaking as a result of the sale”, the words “undertaking, by any means,” shall be substituted;

(II) after Explanation 2, the following Explanation shall be inserted, namely:––

‘Explanation 3.––For the purposes of this clause, “transfer” shall have the meaning assigned to it in clause (47);’;

(vi) in clause (48), with effect from the 1st day of April, 2022,––

(I) in sub-clause (a), after the words “infrastructure capital fund or”, the words “infrastructure debt fund or” shall be inserted;

(II) in sub-clause (b), after the words “infrastructure capital fund or”, the words “infrastructure debt fund or” shall be inserted;

the words “infrastructure debt fund or” shall be inserted;

(II) in sub-clause (b), after the words “infrastructure capital fund or”, the words “infrastructure debt fund or” shall be inserted;

(III) the Explanation shall be numbered as Explanation 1 thereof and after Explanation 1 as so numbered, the following Explanation shall be inserted, namely:––

‘Explanation 2.—For the purposes of this clause, the expression “infrastructure debt fund” shall mean the infrastructure debt fund notified by the Central Government in the Official Gazette under clause (47) of section 10.’.

Amendment of section 9A. 4. In section 9A of the Income-tax Act, after sub-section (8), the following sub-section shall be inserted with effect from the 1st day of April, 2022, namely:––

“(8A) The Central Government may, by notification in the Official Gazette, specify that any one or more of the conditions specified in clauses (a) to (m) of sub-section (3) or clauses (a) to (d) of sub-section (4) shall not apply or shall apply with such modifications, as may be specified in such notification, in case of an eligible investment fund and its eligible fund manager, if such fund manager is located in an International Financial Services Centre, as defined in clause (a) of the Explanation to section 80LA, and has commenced its operations on or before the 31st day of March, 2024.”.

Amendment of section 10. 5.

nancial Services Centre, as defined in clause (a) of the Explanation to section 80LA, and has commenced its operations on or before the 31st day of March, 2024.”.

Amendment of section 10. 5. In section 10 of the Income-tax Act,––

(a) with effect from the 1st day of April, 2022,––

(i) in clause (4D),––

(I) after the words “attributable to units held by non-resident (not being the permanent establishment of a non-resident in India)”, the words “or is attributable to the investment division of offshore banking unit, as the case may be,” shall be inserted;

(II) in the Explanation,––

(A) after clause (a), the following clause shall be inserted, namely:––

‘(aa) “investment division of offshore banking unit” means an investment division of
a banking unit of a non-resident located in an International Financial Services Centre, as referred to in sub-section (1A) of section 80LA and which has commenced its operations on or before the 31st day of March, 2024’;

(B) for clause (c), the following clause shall be substituted, namely:––

‘(c) “specified fund” means,––

(i) a fund established or incorporated in India in the form of a trust or a company or a limited liability partnership or a body corporate,––

namely:––

‘(c) “specified fund” means,––

(i) a fund established or incorporated in India in the form of a trust or a company or a limited liability partnership or a body corporate,––

(I) which has been granted a certificate of registration as a Category III Alternative Investment Fund and is regulated under the Securities and Exchange Board of India (Alternative Investment Fund) Regulations, 2012, made under the Securities and Exchange Board of India Act, 1992;

15 of 1992. (II) which is located in any International Financial Services Centre; and

(III) of which all the units other than unit held by a sponsor or manager are held by non-residents; or

(ii) investment division of an offshore banking unit, which has been––

(I) granted a certificate of registration as a Category III Alternative Investment Fund and is regulated under the Securities and Exchange Board of India (Alternative Investment Fund) Regulations, 2012, made under the Securities and Exchange Board of India Act, 1992 or which has commenced its operations on or before the 31st day of March, 2024; and

15 of 1992.

tions, 2012, made under the Securities and Exchange Board of India Act, 1992 or which has commenced its operations on or before the 31st day of March, 2024; and

15 of 1992.

(II) fulfils such conditions including maintenance of separate accounts for its investment division, as may be prescribed;’;

(ii) after clause (4D), the following clauses shall be inserted, namely:––

“(4E) any income accrued or arisen to, or received by a non-resident as a result of transfer of non- deliverable forward contracts entered into with an offshore banking unit of an International Financial Services Centre as referred to in sub-section (1A) of section 80LA, which fulfils such conditions as may be prescribed;

(4F) any income of a non-resident by way of royalty, on account of lease of an aircraft in a previous

year, paid by a unit of an International Financial Services Centre as referred to in sub-section (1A) of section 80LA, if the unit––

(i) is eligible for deduction under the said section for that previous year; and

(ii) has commenced its operations on or before the 31st day of March, 2024.”;

section 80LA, if the unit––

(i) is eligible for deduction under the said section for that previous year; and

(ii) has commenced its operations on or before the 31st day of March, 2024.”;

(b) in clause (5),––

(i) after the proviso and before the Explanation, the following proviso shall be inserted, namely:––

“Provided further that for the assessment year beginning on the 1st day of April, 2021, the value in lieu of any travel concession or assistance received by, or due to, such individual shall also be exempt under this clause subject to the fulfillment of such conditions (including the condition of incurring such amount of such expenditure within such period), as may be prescribed.”;

(ii) the Explanation shall be numbered as Explanation 1 thereof and after Explanation 1 as so numbered, the following Explanation shall be inserted, namely:––

“Explanation 2.—For the removal of doubts, it is hereby clarified that where an individual claims exemption and the exemption is allowed under the second proviso in connection with the prescribed
expenditure, no exemption shall be allowed under this clause in respect of such prescribed expenditure to any other individual.”;

lowed under the second proviso in connection with the prescribed
expenditure, no exemption shall be allowed under this clause in respect of such prescribed expenditure to any other individual.”;

(i) after the third proviso and before Explanation 1, the following provisos shall be inserted, namely:––

“Provided also that nothing contained in this clause shall apply with respect to any unit linked insurance policy, issued on or after the 1st day of February, 2021, if the amount of premium payable for any of the previous year during the term of such policy exceeds two lakh and fifty thousand rupees:

Provided also that if the premium is payable, by a person, for more than one unit linked insurance

policies, issued on or after the 1st day of February, 2021, the provisions of this clause shall apply only with respect to those unit linked insurance policies, where the aggregate amount of premium does not exceed the amount referred to in fourth proviso in any of the previous year during the term of any of those policies:

Provided also that the provisions of the fourth and fifth provisos shall not apply to any sum received on the death of a person:

Provided also that if any difficulty arises in giving effect to the provisions of this clause, the Board may, with the previous approval of the Central Government, issue guidelines for the purpose of removing the difficulty and every guideline issued by the Board under this proviso shall be laid before each

previous approval of the Central Government, issue guidelines for the purpose of removing the difficulty and every guideline issued by the Board under this proviso shall be laid before each House of Parliament, and shall be binding on the income-tax authorities and the assessee.”;

(ii) after Explanation 2, the following Explanation

‘Explanation 3.— For the purposes of this clause, “unit linked insurance policy” means a life insurance policy which has components of both investment and insurance and is linked to a unit as defined in clause (ee) of regulation 3 of the Insurance Regulatory and Development Authority of India (Unit Linked Insurance Products) Regulations, 2019 issued by the Insurance Regulatory and Development Authority under the Insurance Act, 1938 and the Insurance Regulatory and Development Authority Act, 1999.’;

4 of 1938. 41 of 1999. (d) with effect from the 1st day of April, 2022,––

(i) in clause (11), the following proviso shall be inserted, namely:––

“Provided that the provisions of this clause shall not apply to the income by way of interest accrued during the previous year in the account of a person to the extent it relates to the amount or the aggregate of amounts of contribution made by that person exceeding two lakh and fifty thousand rupees in any previous year in that fund, on or after the 1st day of April, 2021 and computed in such manner as may be prescribed;”;

tion made by that person exceeding two lakh and fifty thousand rupees in any previous year in that fund, on or after the 1st day of April, 2021 and computed in such manner as may be prescribed;”;

(ii) in clause (12), the following proviso shall be inserted, namely:––

(iii) in clause (23C),––

(I) in sub-clause (iiiad), for the words “receipts of such university or educational institution do not exceed the amount of annual receipts as may be prescribed”, the words “receipts of the person from such university or universities or educational institution or educational institutions do not exceed five crore rupees” shall be substituted;

(II) in sub-clause (iiiae),––

(A) for the words “receipts of such hospital or institution do not exceed the amount of annual receipts as may be prescribed; or”, the words “receipts of the person from such hospital or hospitals or institution or institutions do not exceed five crore rupees.” shall be substituted;

annual receipts as may be prescribed; or”, the words “receipts of the person from such hospital or hospitals or institution or institutions do not exceed five crore rupees.” shall be substituted;

(B) after sub-clause (iiiae), the following Explanation

“Explanation.––For the purposes of sub-clauses (iiiad) and (iiiae), it is hereby clarified that if the person has receipts from university or universities or educational institution or institutions as referred to in sub-clause (iiiad), as well as from hospital or hospitals or institution or institutions as referred to in sub-clause (iiiae), the exemptions under these clauses shall not apply, if the aggregate of annual receipts of the person from such university or universities or educational institution or institutions or hospital or hospitals or institution or institutions, exceed five crore rupees; or”;

(III) in the third proviso,––

(A) the Explanation shall be numbered as Explanation 1 thereof and in Explanation 1 as so numbered, after the words “medical institution:” occurring at the end, the

in the third proviso,––

(A) the Explanation shall be numbered as Explanation 1 thereof and in Explanation 1 as so numbered, after the words “medical institution:” occurring at the end, the

words, brackets and figures “subject to the condition that such voluntary contributions are invested or deposited in one or more of the forms or modes specified in sub- section (5) of section 11 maintained specifically for such corpus.” shall be inserted;

(B) after Explanation 1 as so numbered, the following Explanation shall be inserted, namely:––

“Explanation 2.––For the purposes of determining the amount of application under this proviso,-

(i) application for charitable or religious purposes from the corpus as referred to in Explanation 1, shall not be treated as application of income for charitable or religious purposes:

Provided that the amount not so treated as application or part thereof, shall be treated as application for charitable or religious purposes in the previous year in which the amount, or part thereof, is invested or deposited back, into one or more of the forms or modes specified in sub-section (5) of section 11 maintained specifically for such corpus, from the income of that year and to the extent of such investment or deposit;

one or more of the forms or modes specified in sub-section (5) of section 11 maintained specifically for such corpus, from the income of that year and to the extent of such investment or deposit; and

(ii) application for charitable or religious purposes, from any loan or borrowing, shall not be treated as application of income for charitable or religious purposes:

Provided that the amount not so treated as application or part thereof, shall be treated as application for charitable or religious purposes in the previous year in which the loan or borrowing, or part thereof, is repaid from the income of that year and to the extent of such repayment:”;

(IV) in the fourteenth proviso, after the figures and letters “12AA”, the words, figures and letters “or section 12AB” shall be inserted;

(V) after the twentieth proviso, the Explanation shall be numbered as Explanation 1 thereof and after Explanation 1 as so numbered, the following Explanation shall be inserted, namely:––

“Explanation 2.––For the purposes of this clause, it is clarified that the calculation of income required to be applied or accumulated during the previous year shall be made without any set off or deduction or allowance of any

es of this clause, it is clarified that the calculation of income required to be applied or accumulated during the previous year shall be made without any set off or deduction or allowance of any

excess application of any of the year preceding to the previous year;”;

(e) in clause (23FE),––

(A) in sub-clause (iii),––

(i) in item (c),––

(I) for the words “hundred per cent.”, the words “not less than fifty per cent.” shall be substituted;

(II) after the word, brackets and letter “item (b)”, the words, brackets, figures and letter “or in an Infrastructure Investment Trust referred to in sub- clause (i) of clause (13A) of section 2; or” shall be inserted;

(ii) after item (c), the following items shall be inserted, namely:––

“(d) a domestic company, set up and registered on or after the 1st day of April, 2021, having minimum seventy- five per cent. investments in one or more of the companies or enterprises or entities referred to in item (b); or

(e) a non-banking financial company registered as an Infrastructure Finance Company as referred to in notification number RBI/2009-10/316 issued by the Reserve Bank of India or in an Infrastructure Debt Fund, a non-banking finance company, as referred to in the Infrastructure Debt Fund-Non-Banking Financial Companies (Reserve Bank) Directions, 2011, issued by the Reserve Bank of India, having minimum ninety per cent.

ce company, as referred to in the Infrastructure Debt Fund-Non-Banking Financial Companies (Reserve Bank) Directions, 2011, issued by the Reserve Bank of India, having minimum ninety per cent. lending to one or more of the companies or enterprises or entities referred to in item (b):”;

(B) after the third proviso, the following provisos shall be inserted, namely:––

“Provided also that in case a Category-I or Category- II Alternative Investment Fund referred to in item (c) of sub-clause (iii) has investment of less than one hundred per cent. in one or more of the companies or enterprises or entities referred to in item (b) of the said sub-clause or in an Infrastructure Investment Trust referred to in item (c) of the said sub-clause, income accrued or arisen or received or attributable to such investment, directly or indirectly, which is exempt under this clause shall be

calculated proportionately to that investment made in one or more of the companies or enterprises or entities referred to in item (b) of the said sub-clause or in the Infrastructure Investment Trust referred to in item (c) of the said sub-clause, in such manner as may be prescribed:

Provided also that in case a domestic company referred to in item (d) of sub-clause (iii) has investment of less than one hundred per cent.

said sub-clause, in such manner as may be prescribed:

Provided also that in case a domestic company referred to in item (d) of sub-clause (iii) has investment of less than one hundred per cent. in one or more of the companies or enterprises or entities referred to in item (b) of the said sub-clause, income accrued or arisen or received or attributable to such investments, directly or indirectly, which is exempt under this clause shall be calculated proportionately to the investment made in one or more of the companies or enterprises or entities referred to in item (b) of the said sub-clause, in such manner as may be prescribed:

Provided also that in case a non-banking finance company registered as an Infrastructure Finance Company or Infrastructure Debt Fund, referred to in item (e) of sub-clause (iii), has lending of less than one hundred per cent. in one or more of the companies or enterprises or entities referred to in item (b) of the said sub-clause, income accrued or arisen or received or attributable to such lending, directly or indirectly, which is exempt under this clause shall be calculated proportionately to the lending made in one or more of the companies or enterprises or entities referred to in item (b) of the said sub-clause, in such manner as may be prescribed:

Provided also that in case a sovereign wealth fund or pension fund has loans or borrowings, directly or indirectly, for the purposes of making investment in India, such fund shall be deemed to be not eligible for exemption under this clause.”;

nd or pension fund has loans or borrowings, directly or indirectly, for the purposes of making investment in India, such fund shall be deemed to be not eligible for exemption under this clause.”;

(i) in clause (b),––

(I) after sub-clause (iv), the following proviso

“Provided that the provisions of sub-clause (iii) and (iv) shall not apply to any payment made to creditors or depositors for loan taken or

borrowing for the purposes other than for making investment in India;”;

(II) in sub-clause (v), for the words “undertake any commercial activity whether within or outside India”, the words “participate in the day to day operations of investee but the monitoring mechanism to protect the investment with the investee including the right to appoint directors or executive director shall not be considered as participation in the day to day operations of the investee” shall be substituted;

(ii) in clause (c),––

(I) in sub-clause (ii), after the word “country”, the words “or if liable to tax, exemption from taxation for all its income has been provided by such foreign country” shall be inserted;

(II) in sub-clause (iii), for the words “prescribed; and”, the word “prescribed;”, shall be substituted;

ation for all its income has been provided by such foreign country” shall be inserted;

(II) in sub-clause (iii), for the words “prescribed; and”, the word “prescribed;”, shall be substituted;

(III) after sub-clause (iii), the following sub- clause shall be inserted, namely:––

“(iiia) it does not participate in the day to day operations of investee but the monitoring mechanism to protect the investment with the investee including the right to appoint directors or executive director shall not be considered as participation in day to day operations of the investee; and”;

(D) after Explanation 1, the following Explanations shall be inserted, namely:––

‘Explanation 2.— For the purposes of this clause,––

(i) “investee” means a business trust, or a company, or an enterprise, or an entity, or a Category I or Category II Alternative Investment Fund, or an Infrastructure Investment Trust or a domestic company, or an Infrastructure Finance Company or an Infrastructure Debt Fund referred to in item (e) of sub-clause (iii), in which the sovereign wealth fund or the pension fund, as the case may be, has made the investment, directly or indirectly, under the provisions of this clause;

(ii) “loan and borrowing” means—

which the sovereign wealth fund or the pension fund, as the case may be, has made the investment, directly or indirectly, under the provisions of this clause;

(ii) “loan and borrowing” means—

(a) any loan taken or borrowing by a sovereign wealth fund from, or any deposit or investment made in a sovereign wealth fund by, any person other than the Government of the country in which the sovereign wealth fund is set up;

(b) any loan taken or borrowing by a pension fund from or any deposit or investment made in a pension fund by, any person but shall not include the deposit or investment which represents statutory obligations and defined contributions of one or more funds or plans established for providing retirement, social security, employment, disability, death benefits or any similar compensation to the participants or beneficiaries of such funds or plans, as the case may be.

Explanation 3.––For the purposes of this clause, the Central Government may prescribe that the method of calculation of “fifty per cent.” referred to in item (c) or “seventy-five per cent.” referred to in item (d) or “ninety per cent.” referred to in item (e), of sub-clause (iii) shall be such as may be prescribed;’;

fty per cent.” referred to in item (c) or “seventy-five per cent.” referred to in item (d) or “ninety per cent.” referred to in item (e), of sub-clause (iii) shall be such as may be prescribed;’;

(f) after clause (23FE), the following clause shall be inserted with effect from the 1st day of April, 2022, namely:––

‘(23FF) any income of the nature of capital gains, arising or received by a non-resident, which is on account of transfer of share of a company resident in India, by the resultant fund and such shares were transferred from the original fund to the resultant fund in relocation, and where capital gains on such shares were not chargeable to tax if that relocation had not taken place.

Explanation.––For the purposes of this clause, the expressions “original fund”, “relocation” and “resultant fund” shall have the meanings respectively assigned to them in the Explanation to clause (viiac) and clause (viiad) of section 47;’;

(g) in clause (50),––

(I) for the figures “2021”, the figures “2020” shall be substituted;

ively assigned to them in the Explanation to clause (viiac) and clause (viiad) of section 47;’;

(g) in clause (50),––

(I) for the figures “2021”, the figures “2020” shall be substituted;

(II) for the Explanation, the following Explanations shall be substituted, namely:––

‘Explanation 1.––For the removal of doubts it is hereby clarified that the income referred to in this clause shall not include and shall be deemed never to have been included any income which is chargeable to tax as royalty or fees for technical services in India under this Act read with the agreement notified by the Central Government under section 90 or section 90A.

Explanation 2.—For the purposes of this clause,––

(i) “e-commerce supply or services” shall have the meaning assigned to it in clause (cb) of section 164 of the Finance Act, 2016;

28 of 2016. (ii) "specified service" shall have the meaning assigned to it in clause (i) of section 164 of the Finance Act, 2016.’.

28 of 2016. Amendment of section 11. 6.

ct, 2016;

28 of 2016. (ii) "specified service" shall have the meaning assigned to it in clause (i) of section 164 of the Finance Act, 2016.’.

28 of 2016. Amendment of section 11. 6. In section 11 of the Income-tax Act, with effect from the 1st day of April, 2022,––

(a) in sub-section (1),––

(i) in clause (d), for the word “institution”, the words, brackets and figures “institution, subject to the condition that such voluntary contributions are invested or deposited in one or more of the forms or modes specified in sub-section (5) maintained specifically for such corpus” shall be substituted;

(ii) after Explanation 3, the following Explanations shall be inserted, namely:––

“Explanation 4.––For the purposes of determining the amount of application under clause (a) or clause (b),––

(i) application for charitable or religious purposes from the corpus as referred to in clause (d) of this sub- section, shall not be treated as application of income for charitable or religious purposes:

Provided that the amount not so treated as application, or part thereof, shall be treated as application for charitable or religious purposes in the previous year in which the amount, or part thereof, is invested or deposited back, into one or more of the forms or modes specified in sub-section (5) maintained specifically for such corpus,

the previous year in which the amount, or part thereof, is invested or deposited back, into one or more of the forms or modes specified in sub-section (5) maintained specifically for such corpus,

from the income of that year and to the extent of such investment or deposit; and

(ii) application for charitable or religious purposes, from any loan or borrowing, shall not be treated as application of income for charitable or religious purposes:

Provided that the amount not so treated as application, or part thereof, shall be treated as application for charitable or religious purposes in the previous year in which the loan or borrowing, or part thereof, is repaid from the income of that year and to the extent of such repayment.

Explanation 5.––For the purposes of this sub-section, it is hereby clarified that the calculation of income required to be applied or accumulated during the previous year shall be made without any set off or deduction or allowance of any excess application of any of the year preceding the previous year.”;

(b) in sub-section (2), in the Explanation, after the figures and letters “12AA”, the words, figures and letters “or section 12AB” shall be inserted;

(c) in sub-section (3), in clause (d), after the figures and letters “12AA”, the words, figures and letters “or section 12AB” shall be inserted.

Amendment of section 32. 7.

ll be inserted;

(c) in sub-section (3), in clause (d), after the figures and letters “12AA”, the words, figures and letters “or section 12AB” shall be inserted.

Amendment of section 32. 7. In section 32 of the Income-tax Act, in sub-section (1),––

(a) in clause (ii), after the words, figures and letters, “after the 1st day of April, 1998,”, the words “not being goodwill of a business or profession,” shall be inserted;

(b) in Explanation 3, in clause (b), after the words “or commercial rights of similar nature”, the words “, not being goodwill of a business or profession” shall be inserted.

Amendment of section 36.

In section 36 of the Income-tax Act, in sub-section (1), in clause (va), the Explanation shall be numbered as Explanation 1 thereof and after Explanation 1 as so numbered, the following Explanation shall be inserted, namely:––

‘Explanation 2.––For the removal of doubts, it is hereby clarified that the provisions of section 43B shall not apply and shall be deemed never to have been applied for the purposes of determining the “due date” under this clause;’.

oubts, it is hereby clarified that the provisions of section 43B shall not apply and shall be deemed never to have been applied for the purposes of determining the “due date” under this clause;’.

Amendment of section 43B.

In section 43B of the Income-tax Act, after Explanation 4, the following Explanation shall be inserted, namely:––

“Explanation 5.––For the removal of doubts, it is hereby clarified that the provisions of this section shall not apply and shall be deemed never to have been applied to a sum received by the assessee from any of his employees to which the provisions of sub-clause (x) of clause (24) of section 2 applies.”.

Amendment of section 43CA. 10. In section 43CA of the Income-tax Act,––

(a) in sub-section (1), after the proviso, the following proviso shall be inserted, namely:––

‘Provided further that in case of transfer of an asset, being a residential unit, the provisions of this proviso shall have the effect as if for the words “one hundred and ten per cent.”, the words “one hundred and twenty per cent.” had been substituted, if the following conditions are satisfied, namely:––

(i) the transfer of such residential unit takes place during the period beginning from the 12th day of November, 2020 and ending on the 30th day of June, 2021;

(ii) such transfer is by way of first time allotment of the residential unit to any person; and

(iii) the consideration received or accruing as a result of such transfer does not exceed two crore rupees.’;

ansfer is by way of first time allotment of the residential unit to any person; and

(iii) the consideration received or accruing as a result of such transfer does not exceed two crore rupees.’;

(b) after sub-section (4), the following Explanation shall
be inserted, namely:––

‘Explanation.––For the purposes of this section, “residential unit” means an independent housing unit with separate facilities for living, cooking and sanitary requirement, distinctly separated from other residential units within the building, which is directly accessible from an outer door or through an interior door in a shared hallway and not by walking through the living space of another household.’.

Amendment of section 44AB. 11. In section 44AB of the Income-tax Act, in clause (a), in the proviso, in long line, for the words “five crore rupees”, the words “ten crore rupees” shall be substituted.

Amendment of section 44ADA. 12. In section 44ADA of the Income-tax Act, in sub-section (1), for the words “in the case of an assessee, being a resident in India, who”, the words, brackets, letter and figures “in case of an assessee, being an individual, Hindu undivided family or a partnership firm other than a limited liability partnership as defined under clause (n) of sub-section (1) of section 2 of the Limited Liability Partnership Act, 2008, who is a resident in India, and” shall be substituted.

6 of 2009. Amendment of section 44DB.
13.

sub-section (1) of section 2 of the Limited Liability Partnership Act, 2008, who is a resident in India, and” shall be substituted.

6 of 2009. Amendment of section 44DB.
13. In section 44DB of the Income-tax Act,──

(a) in sub-section (3), after the words “successor co- operative bank”, the words “or to the converted banking company” shall be inserted;

(b) in sub-section (4), after the words “a successor co- operative bank”, and the words “the successor co-operative bank” the words “or to a converted banking company” and the words “or to the converted banking company” shall, respectively, be inserted;

(i) after clause (c), the following clause shall be inserted, namely:––

‘(ca) "banking company" shall have the meaning
assigned to it in clause (c) of section 5 of Banking Regulation Act, 1949;’;

10 of 1949.

(ii) in clause (d), after the words “a co-operative bank”, the words “or conversion of a primary co- operative bank” shall be inserted;

(iii) after clause (d), the following clauses shall be inserted, namely:––

‘(da) “conversion” means transition of a primary co-operative bank to a banking company under the scheme of the Reserve Bank of India as notified vide its circular number DCBR. CO. LS. PCB. Cir. No.

da) “conversion” means transition of a primary co-operative bank to a banking company under the scheme of the Reserve Bank of India as notified vide its circular number DCBR. CO. LS. PCB. Cir. No. 5/07.01.000/2018-19, dated the 27th September, 2018;

(db) “converted banking company” means a banking company formed as a result of conversion from primary co-operative bank;’ ;

(iv) in clause (h), after the words “the demerged co- operative bank”, the words “or the primary co-operative

bank which has been succeeded as a result of conversion” shall be inserted;

(v) after clause (h), the following clause shall be
inserted, namely:––

‘(ha) “primary co-operative bank” shall have the
meaning assigned to it in clause (ccv) of section 5 of the Banking Regulation Act, 1949;’.

10 of 1949. Amendment of section 45. 14. In section 45 of the Income-tax Act,––

(a) after sub-section (1A), the following sub-section shall be inserted, namely:––

‘(1B) Notwithstanding anything contained in sub-section (1), where any person receives at any time during any previous year any amount under a unit linked insurance policy, to which exemption under clause (10D) of section 10 does not apply on account of the applicability of the fourth and fifth proviso thereof, including the amount allocated by way of bonus on such policy, then, any profits or gains arising from receipt of such amount by such person shall be chargeable to income-tax under the head "Capital gains" and shall be deemed to be the income of such person of the

any profits or gains arising from receipt of such amount by such person shall be chargeable to income-tax under the head "Capital gains" and shall be deemed to be the income of such person of the previous year in which such amount was received and the income taxable shall be calculated in such manner as may be prescribed.’;

(b) for sub-section (4), the following sub-sections shall be

‘(4) Notwithstanding anything contained in sub-section (1), where a specified person receives during the previous year any capital asset at the time of dissolution or reconstitution of the specified entity, which represents the balance in his capital account in the books of accounts of such specified entity at the time of its dissolution or reconstitution, then any profits or gains arising from receipt of such capital asset by the specified person shall be chargeable to income-tax as income of such specified entity under the head "Capital gains" and shall be deemed to be the income of such specified entity of the previous year in which such capital asset was received by the specified person and notwithstanding anything to the contrary contained in this Act, for the purposes of section 48,––

(a) fair market value of the capital asset on the date of such receipt shall be deemed to be the full value of the consideration received or accruing as a result of the transfer of such capital asset; and

market value of the capital asset on the date of such receipt shall be deemed to be the full value of the consideration received or accruing as a result of the transfer of such capital asset; and

(b) the cost of acquisition of the capital asset shall be determined in accordance with the provisions of this Chapter:

Provided that the balance in the capital account of the specified person in the books of account of the specified entity is to be calculated without taking into account increase in the capital account of the specified person due to revaluation of any asset or due to self-generated goodwill or any other self-generated asset.

Explanation.––For the purposes of this sub-section,––

(i) “specified entity” means a firm or other association of persons or body of individuals (not being a company or a cooperative society);

(ii) “self-generated goodwill” and “self-generated asset” mean goodwill or asset, as the case may be, which has been acquired without incurring any cost for purchase or which has been generated during the course of the business or profession;

(iii) “specified person” means a person who is partner of a firm or member of other association of persons or body of individuals (not being a company or a cooperative society), in any previous year.

i) “specified person” means a person who is partner of a firm or member of other association of persons or body of individuals (not being a company or a cooperative society), in any previous year.

(4A) Notwithstanding anything contained in sub-section (1), where a specified person receives during the previous year any money or other asset at the time of dissolution or reconstitution of the specified entity, which is in excess of the balance in his capital account in the books of accounts of such specified entity at the time of its dissolution or reconstitution, then any profits or gains arising from receipt of such money or other asset by the specified person shall be chargeable to income-tax as income of such specified entity under the head "Capital gains" and shall be deemed to be the income of such specified entity of the previous year in which such money or other asset was received by the specified person and notwithstanding anything to the contrary contained in this Act, for the purposes of section 48,––

(a) value of any money or the fair market value of other asset on the date of such receipt shall be deemed to be the full value of the consideration received or accruing as a result of the transfer of such capital asset; and

(b) the balance in the capital account of the specified person in the books of accounts of the specified entity at the

eceived or accruing as a result of the transfer of such capital asset; and

(b) the balance in the capital account of the specified person in the books of accounts of the specified entity at the

time of its dissolution or reconstitution shall be deemed to be the cost of acquisition:

Explanation.––For the purpose of this sub-section, the expressions “specified entity”, “self-generated goodwill”, “self- generated asset” and "specified person" shall have the meaning respectively assigned to them in sub-section (4).’.

Amendment of section 47.
15. In section 47 of the Income-tax Act,──

(a) in clause (vica), after the words “successor co- operative bank”, the words “or to the converted banking company” shall be inserted;

(b) in clause (vicb),––

(i) after the words “successor co-operative bank”, the words “or to the converted banking company” shall be inserted;

(ii) in the Explanation, for the words ‘expressions “business reorganisation”, “predecessor co-operative bank” and’, the words ‘expressions “business reorganisation”, “converted banking company”, “predecessor co-operative bank” and’ shall be substituted;

tion”, “predecessor co-operative bank” and’, the words ‘expressions “business reorganisation”, “converted banking company”, “predecessor co-operative bank” and’ shall be substituted;

‘(viiac) any transfer, in a relocation, of a capital asset by the original fund to the resulting fund;

(viiad) any transfer by a shareholder or unit holder or interest holder, in a relocation, of a capital asset being a share or unit or interest held by him in the original fund in consideration for the share or unit or interest in the resultant fund;

Explanation.–– For the purposes of clauses (viiac) and (viiad),––

(a) “original fund” means a fund established or incorporated or registered outside India, which collects funds from its members for investing it for their benefit and fulfills the following conditions, namely:—

(i) the fund is not a person resident in India;

(ii) the fund is a resident of a country or a specified territory with which an agreement referred to in sub-section (1) of section 90 or sub- section (1) of section 90A has been entered into; or is established or incorporated or registered in a country or a specified territory as may be notified by the Central Government in this behalf;

(iii) the fund and its activities are subject to applicable investor protection regulations in the country or specified territory where it is established or incorporated or is a resident;

half;

(iii) the fund and its activities are subject to applicable investor protection regulations in the country or specified territory where it is established or incorporated or is a resident; and

(iv) fulfils such other conditions as may be prescribed;

(b) “relocation” means transfer of assets of the original fund to a resultant fund on or before the 31st day of March, 2023, where consideration for such transfer is discharged in the form of share or unit or interest in the resulting fund to the shareholder or unit holder or interest holder of the original fund in the same proportion in which the share or unit or interest was held by such shareholder or unit holder or interest holder in such original fund;

(c) “resultant fund” means a fund established or incorporated in India in the form of a trust or a company or a limited liability partnership, which––

(i) has been granted a certificate of registration as a Category I or Category II or Category III Alternative Investment Fund, and is regulated under the Securities and Exchange Board of India (Alternative Investment Fund) Regulations, 2012 made under the Securities and exchange Board of India Act, 1992; and

15 of 1992.

(ii) is located in any International Financial Services Centre as referred to in sub-section (1A) of section 80LA;’.

s and exchange Board of India Act, 1992; and

15 of 1992.

(ii) is located in any International Financial Services Centre as referred to in sub-section (1A) of section 80LA;’.

Amendment of section 48.
16. In section 48 of the Income-tax Act, after clause (ii) the following clause shall be inserted, namely: ──

“(iii) in case of specified entity referred to in sub-section (4A) of section 45, the amount included in the total income of such specified entity under sub-section (4A) of section 45 which is attributable to the capital asset being transferred, calculated in the prescribed manner:”.

Amendment of section 49. 17. In section 49 of the income-tax Act, in sub-section (1), in clause (iii), in sub-clause (e), after the words, brackets, figures and letters “clause (vicc) or”, the words, brackets, figures and letters “clause (viiac) or clause (viiad) or” shall be inserted with effect from the 1st day of April, 2022.

Amendment of section 50. 18. In section 50 of the Income-tax Act, in clause (2), the following proviso shall be inserted, namely:––

“Provided that in a case where goodwill of a business or profession forms part of a block of asset for the assessment year beginning on the 1st day of April, 2020 and depreciation thereon has been obtained by the assessee under the Act, the written down value of that block of asset and short term capital gain, if any, shall be determined in such manner as may be prescribed.”.

Amendment of section 54GB. 19.

e under the Act, the written down value of that block of asset and short term capital gain, if any, shall be determined in such manner as may be prescribed.”.

Amendment of section 54GB. 19. In section 54GB of the Income-tax Act, in sub-section (5), in the proviso, for the figures “2021”, the figures “2022” shall be substituted.

Amendment of section 55. 20. In section 55 of the Income-tax Act, in sub-section (2),
for clause (a), the following clause shall be substituted,
namely:––

“(a) in relation to a capital asset, being goodwill of a business or profession, or a trade mark or brand name associated with a business or profession, or a right to manufacture, produce or process any article or thing, or right to carry on any business or profession, or tenancy rights, or stage carriage permits, or loom hours,—

(i) in the case of acquisition of such asset by the assessee by purchase from a previous owner, means the amount of the purchase price; and

(ii) in the case falling under sub-clauses (i) to (iv) of sub-section (1) of section 49 and where such asset was acquired by the previous owner (as defined in that

of the purchase price; and

(ii) in the case falling under sub-clauses (i) to (iv) of sub-section (1) of section 49 and where such asset was acquired by the previous owner (as defined in that

section) by purchase, means the amount of the purchase price for such previous owner; and

(iii) in any other case, shall be taken to be nil:

Provided that where the capital asset, being goodwill of a business or profession, in respect of which a deduction on account of depreciation under sub-section (1) of section 32 has been obtained by the assessee in any previous year preceding the previous year relevant to the assessment year commencing on or after the 1st day of April, 2021, the provisions of sub-clauses (i) and (ii) shall apply with the modification that the total amount of depreciation obtained by the assessee under sub-section (1) of section 32 before the assessment year commencing on the 1st day of April, 2021 shall be reduced from the amount of purchase price;”.

Amendment of section 56. 21.

ssee under sub-section (1) of section 32 before the assessment year commencing on the 1st day of April, 2021 shall be reduced from the amount of purchase price;”.

Amendment of section 56. 21. In section 56 the Income-tax Act, in sub-section (2), in clause (x),––

(a) in sub-clause (b), in item (B), after the third proviso, the following proviso shall be inserted, namely:––

“Provided also that in case of property being referred to in the second proviso to sub-section (1) of section 43CA, the provisions of sub-item (ii) of item (B) shall have effect as if for the words “ten per cent.”, the words “twenty per cent.” had been substituted;”;

(b) in the proviso, in clause (IX) after the words, brackets and figures “clause (vii)”, the words, brackets, figures and letters “or clause (viiac) or clause (viiad)” shall be inserted with effect from the 1st day of April, 2022.

Amendment of section 72A. 22. In section 72A of the Income-tax Act, in sub-section (1),––

(i) for clause (c), the following clauses shall be

“(c) one or more public sector company or companies
with one or more public sector company or companies; or

(d) an erstwhile public sector company with one or more company or companies, if the share purchase agreement entered into under strategic disinvestment restricted immediate amalgamation of the said public sector company and the amalgamation is carried out within five year from the end of the previous year in

ed into under strategic disinvestment restricted immediate amalgamation of the said public sector company and the amalgamation is carried out within five year from the end of the previous year in

which the restriction on amalgamation in the share purchase agreement ends,”;

(ii) after the long line, the following shall be inserted, namely:––

‘Provided that the accumulated loss and the unabsorbed depreciation of the amalgamating company, in case of an amalgamation referred to in clause (d), which is deemed to be the loss or, as the case may be, the allowance for unabsorbed depreciation of the amalgamated company, shall not be more than the accumulated loss and unabsorbed depreciation of the public sector company as on the date on which the public sector company ceases to be a public sector company as a result of strategic disinvestment.

Explanation.––For the purposes of clause (d),––

(i) “control” shall have the same meaning as assigned to in clause (27) of section 2 of the Companies Act, 2013;

18 of 2013.

(ii) “erstwhile public sector company” means a company which was a public sector company in earlier previous years and ceases to be a public sector company by way of strategic disinvestment by the Government;

(iii) “strategic disinvestment” means sale of shareholding by the Central Government or any State Government in a public sector company which results in reduction of its shareholding to below fifty-one per cent. along with transfer of control to the buyer.’.

Amendment of section 79. 23.

overnment in a public sector company which results in reduction of its shareholding to below fifty-one per cent. along with transfer of control to the buyer.’.

Amendment of section 79. 23. In section 79 of the Income-tax Act, in sub-section (2), after clause (d), the following clause shall be inserted with effect from the 1st day of April, 2022, namely:––

“(e) to a company to the extent that a change in the shareholding has taken place during the previous year on account of relocation referred to in the Explanation to clause (viiac) and (viiad) of section 47.”.

Amendment of section 80EEA. 24. In section 80EEA of the Income-tax Act, in sub-section (3), in clause (i), for the figures “2021”, the figures “2022” shall be substituted with effect from the 1st day of April, 2022.

Amendment of section 80-IAC. 25. In section 80-IAC of the Income-tax Act, in the Explanation, in clause (ii), in sub-clause (a), for the figures “2021”, the figures “2022” shall be substituted.

Amendment of section 80-IBA. 26. In section 80-IBA of the Income-tax Act, with effect from the 1st day of April, 2022,––

(a) after sub-section (1) , the following sub-section shall be inserted, namely:––

“(1A) Where the gross total income of an assessee includes any profits and gains derived from the business of developing and building rental housing project, there shall be allowed a deduction of an amount equal to hundred per cent.

an assessee includes any profits and gains derived from the business of developing and building rental housing project, there shall be allowed a deduction of an amount equal to hundred per cent. of the profits and gains derived from such business.”;

(b) in sub-section (2), in clause (a), for the figures “2021”, the figures “2022”shall be substituted;

‘(da) “rental housing project” means a project which is notified by the Central Government in the Official Gazette under this clause on or before the 31st day of March, 2022 and fulfils such conditions as may be specified in the said notification;’.

Amendment of section 80LA. 27. In section 80LA of the Income-tax Act, with effect from the 1st day of April, 2022,––

(i) in sub-section (1A), for the words “any other relevant laws was obtained”, the words “permission or registration
under the International Financial Services Centre Authority Act, 2019 was obtained” shall be substituted;

50 of 2019.

relevant laws was obtained”, the words “permission or registration
under the International Financial Services Centre Authority Act, 2019 was obtained” shall be substituted;

50 of 2019. (ii) in sub-section (2), after clause (c), the following clause

“(d) arising from the transfer of an asset, being an aircraft or aircraft engine, which was leased by a unit referred to in clause (c) to a domestic company engaged in the business of operation of aircraft, before such transfer subject to condition that the unit has commenced operation on or before the 31st day of March, 2024.”;

(iii) in sub-section (3), for clause (ii), the following clause shall be substituted, namely:––

“(ii) a copy of the permission obtained under clause (a) of sub-section (1) of section 23 of the Banking Regulation Act, 1949 or copy of permission or registration obtained under the International Financial Services Centre Authority Act, 2019.”.

10 of 1949.

50 of 2019. Insertion of new section 89A. 28. After section 89 of the Income-tax Act, the following section shall be inserted with effect from the 1st day of April, 2022, namely:––

Relief from taxation in income from retirement benefit account maintained in a notified country.
‘89A. Where a specified person has income accrued in a specified account, such income shall be taxed in such manner and in such year as may be prescribed.

ount maintained in a notified country.
‘89A. Where a specified person has income accrued in a specified account, such income shall be taxed in such manner and in such year as may be prescribed.

Explanation.––For the purposes of this section,––

(a) “specified person” means a person resident in India who opened a specified account in a notified country while being non-resident in India and resident in that country;

(b) “specified account” means an account maintained in a notified country by the specified person in respect of his retirement benefits and the income from such account is not taxable on accrual basis but is taxed by such country at the time of withdrawal or redemption;

(c) “notified country” means a country as may be notified by the Central Government in the Official Gazette for the purposes of this section.’.

Amendment of section 112A. 29. In section 112A of the Income-tax Act, in the Explanation, in clause (a), in the opening portion, after the word and figures “section 10”, the words, brackets, figures and letter “or under a scheme of an insurance company comprising unit linked insurance policies to which exemption under clause (10D) of the said section does not apply on account of the applicability of the fourth and fifth proviso thereof” shall be inserted.

Amendment of section 115AD. 30.

ch exemption under clause (10D) of the said section does not apply on account of the applicability of the fourth and fifth proviso thereof” shall be inserted.

Amendment of section 115AD. 30. In section 115AD of the Income-tax Act, with effect from the 1st day of April, 2022,––

(i) in sub-section (1),––

(a) in the opening portion, after the words “a specified fund”, the words “or investment division of an offshore banking unit” shall be inserted;

(b) in clause (b), in sub-clause (i), in item (B), after the words “of specified fund”, the words “or investment division of an offshore banking unit” shall be inserted;

(ii) after sub-section (1A), the following sub-section shall be inserted, namely:––

“(1B) Notwithstanding anything contained in sub- section (1), in case of investment division of an offshore banking unit, the provisions of this section shall apply to the extent of income that is attributable to the investment division of such banking units, referred to in sub-clause (ii) of clause( c) to the Explanation to clause (4D) of section 10, as a Category-III portfolio investor under the Securities and Exchange Board of India (Foreign Portfolio Investors) Regulations, 2019 made under the Securities And Exchange Board of India Act, 1992, calculated in such manner as may be prescribed.”;

15 of 1992.

Foreign Portfolio Investors) Regulations, 2019 made under the Securities And Exchange Board of India Act, 1992, calculated in such manner as may be prescribed.”;

15 of 1992.

(iii) in sub-section (2), after the words “the specified fund” at both the places where they occur, the words “or investment division of an offshore banking unit” shall be inserted;

(iv) in the Explanation, after clause (a), the following clause shall be inserted, namely:–––

“(aa) the expression “investment division of offshore banking unit” shall have the meaning assigned to it in clause (aa) of the Explanation to clause (4D) of section 10;”.

Amendment of section 115JB. 31. In section 115JB of the Income-tax Act, in sub-section (2),––

(a) in Explanation 1,––

(i) in clause (fb), in sub-clause (B), for the words “interest, royalty”, the words “interest, dividend, royalty” shall be substituted;

(ii) in the long line, in clause (iid), in sub-clause (B), for the words “interest, royalty”, the words “interest, dividend, royalty” shall be substituted;

(b) after sub-section (2C), the following sub-section
shall be inserted, namely: ──

e (B), for the words “interest, royalty”, the words “interest, dividend, royalty” shall be substituted;

(b) after sub-section (2C), the following sub-section
shall be inserted, namely: ──

“(2D) In the case of an assessee being a company, where there is an increase in book profit of the previous year due to income of past year or years included in the book profit on account of an advance pricing agreement
entered into by the assessee under section 92CC or on account of secondary adjustment required to be made under section 92CE, the Assessing Officer shall, on an application made to him in this behalf by the asssessee, recompute the book profit of the past year or years and tax payable, if any, by the assessee during the previous year under sub-section (1), in such manner as may be prescribed and the provisions of section 154 shall, so far as may be, apply and the period of four years specified in sub-section (7) of that section shall be reckoned from the end of the financial year in which the said application is received by the Assessing Officer.”.

Amendment of section
139.

sub-section (7) of that section shall be reckoned from the end of the financial year in which the said application is received by the Assessing Officer.”.

Amendment of section
139.

In section 139 of the Income-tax Act,––

(a) in sub-section (1), in Explanation 2,––

(i) in clause (a), in sub-clause (iii), after the words “any other law for the time being in force”, the words, figure and letter “or the spouse of such partner if the provisions of section 5A applies to such spouse” shall be inserted;

(ii) in clause (aa), after the words “an assessee”, the words “, including the partners of the firm being such assessee,” shall be inserted;

(b) in sub-section (4), for the words “return for any previous year at any time before”, the words “a return for any previous year at any time within three months prior to” shall be substituted;

(c) in sub-section (5), for the words “he may furnish a revised return at any time”, the words “he may furnish a revised return at any time within three months” shall be substituted;

(d) in sub-section (9), in the Explanation, the following proviso shall be inserted, namely:––

“Provided that the Board may, by notification in the Official Gazette, specify that any of the conditions specified in clauses (a) to (f) to the Explanation shall not apply to such class of assessees or shall apply with such modifications, as may be specified in such notification.”.

of the conditions specified in clauses (a) to (f) to the Explanation shall not apply to such class of assessees or shall apply with such modifications, as may be specified in such notification.”.

Amendment
of section
142.

In section 142 of the Income-tax Act, in sub-section (1), in clause (i), after the existing proviso, the following proviso shall be inserted, namely:––

“Provided further that a notice under this sub-section for the purposes of this clause may also be served by the prescribed income-tax authority,”.

Amendment of section 143.

In section 143 of the Income-tax Act,—

(a) in sub-section (1),––

(i) in the second proviso, for the words “one year”, the words “nine months” shall be substituted;

(ii) in clause (a),––

(I) in sub-clause (iv), for the words “disallowance of expenditure indicated”, the words “disallowance of expenditure or increase in income indicated” shall be substituted;

(II) in sub-clause (v), for the words, figures and letters “sections 10AA, 80-IA, 80-IAB, 80-IB, 80-IC, 80-ID or section 80-IE, if”, the words, figures and letters ‘section 10AA or under any of the provisions of Chapter VI-A under the heading “C.-Deductions in respect of certain incomes”, if’ shall be substituted;

(b) in sub-section (2), in the proviso, for the word “six”, the word “three” shall be substituted.

Substitution of new section for section 147. 35. For section 147 of the Income-tax Act, the following section shall be substituted, namely:—

Income escaping assessment.

be substituted.

Substitution of new section for section 147. 35. For section 147 of the Income-tax Act, the following section shall be substituted, namely:—

Income escaping assessment. “147. If any income chargeable to tax, in the case of an assessee, has escaped assessment for any assessment year, the Assessing Officer may, subject to the provisions of sections 148 to 153, assess or reassess such income or recompute the loss or the depreciation allowance or any other allowance or deduction for such assessment year (hereafter in this section and in sections 148 to 153 referred to as the relevant assessment year).

Explanation.—For the purpose of assessment or reassessment under this section, the Assessing Officer may assess or reassess the income in respect of any issue, which has escaped assessment, and such issue comes to his notice

subsequently in the course of the proceedings under this section, irrespective of the fact that the provisions of section 148A have not been complied with.”.

Substitution of new section for section 148. 36. For section 148 of the Income-tax Act, the following section shall be substituted, namely:—

Issue of notice where income has escaped assessment. “148.

of new section for section 148. 36. For section 148 of the Income-tax Act, the following section shall be substituted, namely:—

Issue of notice where income has escaped assessment. “148. Before making the assessment, reassessment or recomputation under section 147, and subject to the provisions of section 148A, the Assessing Officer shall serve on the assessee a notice, along with a copy of the order passed, if required, under clause (d) of section 148A, requiring him to furnish within such period, as may be specified in such notice, a return of his income or the income of any other person in respect of which he is assessable under this Act during the previous year corresponding to the relevant assessment year, in the prescribed form and verified in the prescribed manner and setting forth such other particulars as may be prescribed; and the provisions of this Act shall, so far as may be, apply accordingly as if such return were a return required to be furnished under section 139:

Provided that no notice under this section shall be issued unless there is information with the Assessing Officer which suggests that the income chargeable to tax has escaped assessment in the case of the assessee for the relevant assessment year and the Assessing Officer has obtained prior approval of the specified authority to issue such notice.

le to tax has escaped assessment in the case of the assessee for the relevant assessment year and the Assessing Officer has obtained prior approval of the specified authority to issue such notice.

Explanation 1.—For the purposes of this section and section 148A, the information with the Assessing Officer which suggests that the income chargeable to tax has escaped assessment means,—

(i) any information flagged in the case of the assessee for the relevant assessment year in accordance with the risk management strategy formulated by the Board from time to time;

(ii) any final objection raised by the Comptroller and Auditor General of India to the effect that the assessment in the case of the assessee for the relevant assessment year has not been made in accordance with the provisions of this Act.

Explanation 2.—For the purposes of this section, where,—

(i) a search is initiated under section 132 or books of account, other documents or any assets are requisitioned

isions of this Act.

Explanation 2.—For the purposes of this section, where,—

(i) a search is initiated under section 132 or books of account, other documents or any assets are requisitioned

under section 132A, on or after the 1st day of April, 2021, in the case of the assessee; or

(ii) a survey is conducted under section 133A in the case of the assessee on or after the 1st day of April, 2021; or

(iii) the Assessing Officer is satisfied, with the prior approval of the Principal Commissioner or Commissioner, that any money, bullion, jewellery or other valuable article or thing, seized or requisitioned in case of any other person on or after the 1st day of April, 2021, belongs to the assessee; or

(iv) the Assessing Officer is satisfied, with the prior approval of Principal Commissioner or Commissioner, that any books of account or documents, seized or requisitioned in case of any other person on or after the 1st day of April, 2021, pertains or pertain to, or any information contained therein, relate to, the assessee,

the Assessing Officer shall be deemed to have information which suggests that the income chargeable to tax has escaped assessment in the case of the assessee for the three assessment years immediately preceding the assessment year relevant to the previous year in which the search is initiated or books of account, other documents or any assets are requisitioned or survey is conducted in the case of the assessee or money, bullion, jewellery or other valuable article or thing or books

ed or books of account, other documents or any assets are requisitioned or survey is conducted in the case of the assessee or money, bullion, jewellery or other valuable article or thing or books of account or documents are seized or requisitioned in case of any other person.

Explanation.3—For the purposes of this section, specified authority means the specified authority referred to in section 151.”.

Insertion of new section 148A. 37. After section 148 of the Income-tax Act, the following section shall be inserted, namely:—

Conducting inquiry, providing opportunity before issue of notice under section 148.

“148A. The Assessing Officer shall, before issuing any notice under section 148, —

(a) conduct any enquiry, if required, with the prior approval of specified authority, with respect to the information which suggests that the income chargeable to tax has escaped assessment;

(b) provide an opportunity of being heard to the assessee, with the prior approval of specified authority, by serving upon him a notice to show cause within such time, as may be specified in the notice, being not less than seven days and but not exceeding thirty days from the date on which such notice is issued, or such time, as may be extended by him on the basis of an application in this behalf, as to why a notice under section 148 should not be issued on the basis of information which suggests that income chargeable to tax has escaped assessment in his case for the relevant assessment year and results of

under section 148 should not be issued on the basis of information which suggests that income chargeable to tax has escaped assessment in his case for the relevant assessment year and results of enquiry conducted, if any, as per clause (a);

(d) decide, on the basis of material available on record including reply of the assessee, whether or not it is a fit case to issue a notice under section 148, by passing an order, with the prior approval of specified authority, within one month from the end of the month in which the reply referred to in clause (c) is received by him, or where no such reply is furnished, within one month from the end of the month in which time or extended time allowed to furnish a reply as per clause (b) expires:

Provided that the provisions of this section shall not apply in a case where,—

(a) a search is initiated under section 132 or books of account, other documents or any assets are requisitioned under section 132A in the case of the assessee on or after the 1st day of April, 2021; or

(b) the Assessing Officer is satisfied, with the prior approval of the Principal Commissioner or Commissioner that any money, bullion, jewellery or other valuable article or thing, seized in a search under section 132 or requisitioned under section 132A, in the case of any other person on or after the 1st day of April, 2021, belongs to the assessee;

aluable article or thing, seized in a search under section 132 or requisitioned under section 132A, in the case of any other person on or after the 1st day of April, 2021, belongs to the assessee; or

(c) the Assessing Officer is satisfied, with the prior approval of the Principal Commissioner or Commissioner that any books of account or documents, seized in a search under section 132 or requisitioned under section 132A, in case of any other person on or after the 1st day of April, 2021, pertains

or pertain to, or any information contained therein, relate to, the assessee.

Explanation.—For the purposes of this section, specified authority means the specified authority referred to in section 151.”.

Substitution of new section for section 149. 38. For section 149 of the Income-tax Act, the following section shall be substituted, namely:––

Time limit for notice. “149. (1) No notice under section 148 shall be issued for the relevant assessment year,—

(a) if three years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b);

e under section 148 shall be issued for the relevant assessment year,—

(a) if three years have elapsed from the end of the relevant assessment year, unless the case falls under clause (b);

(b) if three years, but not more than ten years, have elapsed from the end of the relevant assessment year unless the Assessing Officer has in his possession books of accounts or other documents or evidence which reveal that the income chargeable to tax, represented in the form of asset, which has escaped assessment amounts to or is likely to amount to fifty lakh rupees or more for that year:

Provided that no notice under section 148 shall be issued at any time in a case for the relevant assessment year beginning on or before 1st day of April, 2021, if such notice could not have been issued at that time on account of being beyond the time limit specified under the provisions of clause (b) of sub-section (1) of this section, as they stood immediately before the commencement of the Finance Act, 2021:

Provided further that the provisions of this sub-section shall not apply in a case, where a notice under section 153A, or section 153C read with section 153A, is required to be issued in relation to a search initiated under section 132 or books of account, other documents or any assets requisitioned under section 132A, on or before the 31st day of March, 2021:

Provided also that for the purposes of computing the period of limitation as per this section, the time or extended time allowed to the assessee, as per show-cause

31st day of March, 2021:

Provided also that for the purposes of computing the period of limitation as per this section, the time or extended time allowed to the assessee, as per show-cause notice issued under clause (b) of section 148A or the period during which the proceeding under section 148A is stayed by an order or injunction of any court, shall be excluded:

Provided also that where immediately after the exclusion of the period referred to in the immediately preceding proviso, the period of limitation available to the Assessing Officer for passing an order under clause (d) of section 148A is less than seven days, such remaining period shall be extended to seven days and the period of limitation in sub-section (1) shall be deemed to be extended accordingly.

(2) The provisions of sub-section (1) as to the issue of notice shall be subject to the provisions of section 151.”.

Substitution of new section for section 151. 39. For section 151 of the Income-tax Act, the following section shall be substituted, namely:—

Sanction for issue of notice. “151.

n 151.”.

Substitution of new section for section 151. 39. For section 151 of the Income-tax Act, the following section shall be substituted, namely:—

Sanction for issue of notice. “151. Specified authority for the purposes of section 148 and section 148A shall be,—

(i) Principal Commissioner or Principal Director or Commissioner or Director, if three years or less than three years have elapsed from the end of the relevant assessment year;

(ii) Principal Chief Commissioner or Principal Director General or where there is no Principal Chief Commissioner or Principal Director General, Chief Commissioner or Director General, if more than three years have elapsed from the end of the relevant assessment year.”.

Amendment of section 151A. 40. In section 151A of the Income-tax Act, in sub-section (1), in the opening portion, after the words and figures “issuance of notice under section 148”, the words, figures and letter “or conducting of enquiries or issuance of show-cause notice or passing of order under section 148A” shall be inserted.

Amendment of section 153. 41. In section 153 of the Income-tax Act, in sub-section (1), after the second proviso, the following proviso shall be inserted, namely:––

“Provided also that in respect of an order of assessment relating to the assessment year commencing on or after the 1st day of April, 2021, the provisions of this sub-section shall have effect, as if for the words “twenty-one months”, the words “nine months” had been substituted.”.

Amendment of section 153A. 42.

of April, 2021, the provisions of this sub-section shall have effect, as if for the words “twenty-one months”, the words “nine months” had been substituted.”.

Amendment of section 153A. 42. In section 153A of the Income-tax Act, in sub-section (1), in the opening portion, after the words, figures and letters “after the 31st day of May, 2003”, the words, figures and letters “but on or before the 31st day of March, 2021” shall be inserted.

Amendment of section 153C. 43. In section 153C of the Income-tax Act, after sub-section (2), the following sub-section shall be inserted, namely:—

“(3) Nothing contained in this section shall apply in relation to a search initiated under section 132 or books of account, other documents or any assets requisitioned under section 132A on or after the 1st day of April, 2021.”.

Amendment of section 194.

In section 194 of the Income-tax Act, in the second proviso, after clause (c), the following clauses shall be inserted and shall be deemed to have been inserted with effect from the 1st day of April, 2020, namely:––

‘(d) a “business trust”, as defined in clause (13A) of section 2, by a special purpose vehicle referred to in the Explanation to clause (23FC) of section 10;

(e) any other person as may be notified by the Central Government in the Official Gazette in this behalf.’.

Amendment of section 194A. 45.

Explanation to clause (23FC) of section 10;

(e) any other person as may be notified by the Central Government in the Official Gazette in this behalf.’.

Amendment of section 194A. 45. In section 194A of the Income-tax Act, in sub-section (3), in clause (x), after the words “infrastructure capital fund or”, the words “infrastructure debt fund or” shall be inserted.

Amendment of section 194-IB. 46. In section 194-IB of the Income-tax Act, in sub-section (4), for the words, figures and letters “section 206AA, such”, the words, figures and letters “section 206AA or section 206AB, such” shall be substituted with effect from the 1st day of July, 2021.

Insertion of new section 194P. 47. After section 194-O of the Income-tax Act, the following section shall be inserted, namely:––

Deduction of tax in case of specified senior citizen. ‘194P. (1) Notwithstanding anything contained in the provisions of Chapter XVII-B, in case of a specified senior citizen, the specified bank shall, after giving effect to the deduction allowable under Chapter VI-A and rebate allowable under section 87A, compute the total income of such specified senior citizen for the relevant assessment year and deduct income-tax on such total income on the basis of the rates in force.

(2) The provisions of section 139 shall not apply to a specified senior citizen for the assessment year relevant to the previous year in which the tax has been deducted under sub- section (1).

Explanation.–– For the purposes of this section,––

a specified senior citizen for the assessment year relevant to the previous year in which the tax has been deducted under sub- section (1).

Explanation.–– For the purposes of this section,––

(a) “specified bank” means a banking company as the Central Government may, by notification in Official Gazette, specify;

(b) “specified senior citizen” means an individual, being a resident in India––

(i) who is of the age of seventy-five years or more at any time during the previous year;

(ii) who is having income of the nature of pension and no other income except the income of the nature of interest received or receivable from any account maintained by such individual in the same specified bank in which he is receiving his pension income; and

(iii) has furnished a declaration to the specified bank containing such particulars, in such form and verified in such manner, as may be prescribed.’.

Insertion of new section 194Q. 48. After section 194P of the Income-tax Act, the following section shall be inserted with effect 1st day of July, 2021, namely:––

Deduction of tax at source on payment of certain sum for purchase of goods. ‘194Q.

Board for Advance Rulings. “245-OB. (1) The Central Government shall constitute one or more Boards for Advance Rulings, as may be necessary, for giving advance rulings under this Chapter on

or after such date as the Central Government may, by notification in the Official Gazette, appoint.

(2) The Board for Advance Rulings shall consist of two members, each being an officer not below the rank of Chief Commissioner, as may be nominated by the Board.”.

Amendment of section
245P. 70. Section 245P of the Income-tax Act shall be numbered as sub-section (1) thereof, and after sub-section (1) as so numbered, the following sub-section shall be inserted, namely:––

“(2) With effect from such date as the Central Government may, by notification in the Official Gazette, appoint, the provisions of this section shall have effect as if for the word “Authority”, the words “Board for Advance Rulings” had been substituted.”.

Amendment of section
245Q.

In section 245Q of the Income-tax Act,—

(a) in sub-section (1), the words, figures and letters “or under Chapter IIIA of the Central Excise Act, 1944 or under Chapter VA of the Finance Act, 1994” shall be omitted with effect from such date as the Central Government may, by notification in the Official Gazette, appoint;

1 of 1944. 32 of 1994.

under Chapter VA of the Finance Act, 1994” shall be omitted with effect from such date as the Central Government may, by notification in the Official Gazette, appoint;

1 of 1944. 32 of 1994.

(b) after sub-section (3), the following sub-section shall be inserted, namely:—

“(4) Where an application is made under this section before such date as the Central Government may, by notification in the Official Gazette appoint, and in respect of which no order under sub-section (2) of section 245R has been passed or advance ruling under sub-section (4) of section 245R has been pronounced before such date, such application along with all the relevant records, documents or material, by whatever name called, on the file of the Authority shall be transferred to the Board for Advance Rulings and shall be deemed to be the records before the Board for Advance Rulings for all purposes.”.

Amendment
of section
245R. 72. In section 245R of the Income-tax Act, after sub- section (7), the following sub-sections shall be inserted, namely:—

‘(8) On and from such date as the Central Government may, by notification in the Official Gazette, appoint, the provisions of this section shall have effect as if for the word

ed, namely:—

‘(8) On and from such date as the Central Government may, by notification in the Official Gazette, appoint, the provisions of this section shall have effect as if for the word

“Authority”, the words “Board for Advance Rulings” had been substituted and the provisions of this section shall apply mutatis mutandis to the Board for Advance Rulings as they apply to the Authority.

(9) The Central Government may, by notification in the Official Gazette, make a scheme for the purposes of giving advance rulings under this Chapter by the Board for Advance Rulings, so as to impart greater efficiency, transparency and accountability by—

(a) eliminating the interface between the Board for Advance Rulings and the applicant in the course of proceedings to the extent technologically feasible;

(b) optimising utilisation of the resources through economies of scale and functional specialisation;

(10) The Central Government may, for the purposes of giving effect to the scheme made under sub-section (9), by notification in the Official Gazette, direct that any of the provisions of this Act shall not apply or shall apply with such exceptions, modifications and adaptations as may be specified in the said notification:

Provided that no such direction shall be issued after the 31st day of March, 2023.

hall apply with such exceptions, modifications and adaptations as may be specified in the said notification:

Provided that no such direction shall be issued after the 31st day of March, 2023.

(11) Every notification issued under sub-section (9) and sub-section (10) shall, as soon as may be after the notification is issued, be laid before each House of Parliament.’.

Amendment of section
245S. 73. In section 245S of the Income-tax Act, after sub- section (2), the following sub-section shall be inserted, namely:—

“(3) Nothing contained in this section shall apply to any advance ruling pronounced under section 245R on or after such date as the Central Government may, by notification in the Official Gazette, appoint.”.

Amendment
of section
245T. 74. In section 245T of the Income-tax Act,—

(a) in sub-section (1), the words “by it” shall be omitted;

(b) after sub-section (2), the following sub-section shall be inserted, namely:—

In section 245T of the Income-tax Act,—

(a) in sub-section (1), the words “by it” shall be omitted;

(b) after sub-section (2), the following sub-section shall be inserted, namely:—

‘(3) With effect from such date as the Central Government may, by notification in the Official Gazette, appoint, the provisions of this section shall have effect as if for the word “Authority”, the words “Board for Advance Rulings” had been substituted.’.

Amendment of section
245U. 75. In section 245U of the Income-tax Act, after sub-section (2), the following sub-section shall be inserted, namely:—

“(3) On and from such date as the Central Government may, by notification in the Official Gazette, appoint, the powers of the Authority under this section shall be exercised by the Board for Advance Rulings and the provisions of this section shall mutatis mutandis apply to the Board for Advance Rulings as they apply to the Authority.”.

Amendment of section
245V. 76. In section 245V of the Income-tax Act, the following proviso shall be inserted, namely:—

“Provided that nothing contained in this section shall apply on or after such date as the Central Government may, by notification in the Official Gazette, appoint.”.

Insertion of new section
245W. 77. After section 245V of the Income-tax Act, the following section shall be inserted, namely:—

Appeal. “245W.

fication in the Official Gazette, appoint.”.

Insertion of new section
245W. 77. After section 245V of the Income-tax Act, the following section shall be inserted, namely:—

Appeal. “245W. (1) The applicant, if he is aggrieved by any ruling pronounced or order passed by the Board for Advance Rulings or the Assessing Officer, on the directions of the Principal Commissioner or Commissioner, may appeal to the High Court against such ruling or order of the Board of Advance Rulings within sixty days from the date of the communication of that ruling or order, in such form and manner, as may be prescribed:

Provided that where the High Court is satisfied, on an application made by the appellant in this behalf, that the appellant was prevented by sufficient cause from presenting the appeal within the period specified in sub-section (1), it may grant further period of thirty days for filing such appeal.

(2) The Central Government may make a scheme, by notification in the Official Gazette, for the purposes of filing appeal to the High Court under sub-section (1) by the Assessing Officer, so as to impart greater efficiency, transparency and accountability by—

(a) optimising utilisation of the resources through economies of scale and functional specialisation;

ssessing Officer, so as to impart greater efficiency, transparency and accountability by—

(a) optimising utilisation of the resources through economies of scale and functional specialisation;

(b) introducing a team-based mechanism with dynamic jurisdiction.

(3) The Central Government may, for the purposes of giving effect to the scheme made under sub-section (2), by notification in the Official Gazette, direct that any of the provisions of this Act shall not apply or shall apply with such exceptions, modifications and adaptations as may be specified in the said notification:

Provided that no such direction shall be issued after the 31st day of March, 2023.

(4) Every notification issued under sub-section (2) and sub-section (3) shall, as soon as may be after the notification is issued, be laid before each House of Parliament.”.

Amendment of section 255. 78. In section 255 of the Income-tax Act, after sub-section (6), the following sub-sections shall be inserted, namely: ––

“(7) The Central Government may make a scheme, by notification in the Official Gazette, for the purposes of disposal of appeals by the Appellate Tribunal so as to impart greater efficiency, transparency and accountability by—

(a) eliminating the interface between the Appellate Tribunal and parties to the appeal in the course of appellate proceedings to the extent technologically feasible;

(b) optimising utilisation of the resources through economies of scale and functional specialisation;

o the appeal in the course of appellate proceedings to the extent technologically feasible;

(b) optimising utilisation of the resources through economies of scale and functional specialisation;

(8) The Central Government may, for the purposes of giving effect to the scheme made under sub-section (7), by notification in the Official Gazette, direct that any of the provisions of this Act shall not apply to such scheme or shall apply with such exceptions, modifications and adaptations as may be specified in the said notification:

Provided that no such direction shall be issued after the 31st day of March, 2023.

(9) Every notification issued under sub-section (7) and sub-section (8) shall, as soon as may be after the notification is issued, be laid before each House of Parliament.”.

Amendment of section 281B. 79. In section 281B of the Income-tax Act, in sub-section (1), after the words “escaped assessment”, the words, figures and letters “or for imposition of penalty under section 271AAD where the amount or aggregate of amounts of penalty likely to be imposed under the said section exceeds two crore rupees” shall be inserted.

CHAPTER IV

INDIRECT TAXES

Customs

Amendment of section 2.

In the Customs Act, 1962 (hereinafter referred to as the Customs Act), in section 2, after clause (7A), the following clause

‘(7B) “common portal” means the Common Customs Electronic Portal referred to in section 154C;’.

52 of 1962. Amendment of section 5.

ct), in section 2, after clause (7A), the following clause

‘(7B) “common portal” means the Common Customs Electronic Portal referred to in section 154C;’.

52 of 1962. Amendment of section 5. 81. In section 5 of the Customs Act, in sub-section (3), for the words and figures “Chapter XV and section 108”, the words, figures, brackets and letter “Chapter XV, section 108 and sub- section (1D) of section 110” shall be substituted.

Amendment of section 25. 82. In section 25 of the Customs Act, after sub-section (4), the following sub-section shall be inserted, namely:––

“(4A) Where any exemption is granted subject to any condition under sub-section (1), such exemption shall, unless otherwise specified or varied or rescinded, be valid upto 31st day of March falling immediately after two years from the date of such grant or variation:

Provided that in respect of any such exemption in force as on the date on which the Finance Bill, 2021 receives the assent of the President, the said period of two years shall be reckoned from the 1st day February, 2021.”.

Insertion of new section 28BB. 83. After section 28BA of the Customs Act, the following section shall be inserted, namely:––

Time limit for completion of certain actions. “28BB. (1) Any inquiry or investigation under this Act, culminating in the issuance of a notice under sub-section (1) or sub-section (4) of section 28 shall be completed by issuing such notice, within a period of two years from the date of initiation of audit, search, seizure or summons, as the case may be:

(1) or sub-section (4) of section 28 shall be completed by issuing such notice, within a period of two years from the date of initiation of audit, search, seizure or summons, as the case may be:

Provided that the Principal Commissioner of Customs or the Commissioner of Customs may, on sufficient cause being shown and for reasons to be recorded in writing, extend the said period to a further period of one year.

(2) For computing the period under sub-section (1), the period during which stay was granted by an order of a court or tribunal, or the period for seeking information from an overseas authority through a legal process, shall be excluded.

Explanation.––For the removal of doubts, it is hereby declared that nothing contained in this section shall apply to any such proceeding initiated before the date on which the Finance Bill, 2021 receives the assent of the President.”.

Amendment of section 46. 84. In section 46 of the Customs Act, in sub-section (3),––

(i) in the opening portion, for the words and brackets “before the end of the next day following the day (excluding holidays)”, the words and brackets “before the end of the day (including holidays) preceding the day” shall be substituted;

(ii) for the words “Provided that”, the following shall be

“Provided that the Board may, in such cases as it may deem fit, prescribe different time limits for presentation of the bill of entry, which shall not be later than the end of the day of such arrival:

Provided further that”;

n such cases as it may deem fit, prescribe different time limits for presentation of the bill of entry, which shall not be later than the end of the day of such arrival:

Provided further that”;

(iii) for the words “Provided further that”, the words “Provided also that” shall be substituted.

Amendment of section 110. 85. In section 110 of the Customs Act, after sub-section (1C), the following sub-section shall be inserted, namely:––

“(1D) Where the goods seized under sub-section (1) is gold in any form as notified under sub-section (1A), then, the proper officer shall, instead of making an application under sub-section (1B) to the Magistrate, make such application to the Commissioner (Appeals) having jurisdiction, who shall, as soon as may be, allow the application and thereafter, the proper officer shall dispose of such goods in such manner as the Central Government may determine.”.

Amendment of section 113. 86. In section 113 of the Customs Act, after clause (j), the following clause shall be inserted, namely:––

“(ja) any goods entered for exportation under claim of remission or refund of any duty or tax or levy to make a wrongful claim in contravention of the provisions of this Act or any other law for the time being in force;”.

Insertion of new section 114AC.

After section 114AB of the Customs Act, the following section shall be inserted, namely:––

Penalty for fraudulent utilisation of input tax credit for claiming refund.

‘114AC.

After section 114AB of the Customs Act, the following section shall be inserted, namely:––

Penalty for fraudulent utilisation of input tax credit for claiming refund.

‘114AC. Where any person has obtained any invoice by fraud, collusion, willful misstatement or suppression of facts to utilise input tax credit on the basis of such invoice for discharging any duty or tax on goods that are entered for exportation under claim of refund of such duty or tax, such person shall be liable for penalty not exceeding five times the refund claimed.

Explanation.––For the purposes of this section, the expression “input tax credit” shall have the same meaning as assigned to it in clause (63) of section 2 of the Central Goods and Services Tax Act, 2017.’.

12 of 2017. Amendment of section 139. 88. In section 139 of the Customs Act, in the Explanation, for the words, brackets, figures and letter “a Magistrate under sub- section (1C) of section 110”, the words, brackets, figures and letters “a Magistrate under sub-section (1C), or Commissioner (Appeals) under sub-section (1D), of section 110” shall be inserted.

Amendment of section 149. 89.

words, brackets, figures and letters “a Magistrate under sub-section (1C), or Commissioner (Appeals) under sub-section (1D), of section 110” shall be inserted.

Amendment of section 149. 89. In section 149 of the Customs Act, after the proviso, the following provisos shall be inserted, namely:––

“Provided further that such authorisation or amendment may also be done electronically through the customs automated system on the basis of risk evaluation through appropriate selection criteria:

Provided also that such amendments, as may be specified by the Board, may be done by the importer or exporter on the common portal.”.

Amendment of section 153. 90. In section 153 of the Customs Act, in sub-section (1), after clause (c), the following clause shall be inserted, namely:––

“(ca) by making it available on the common portal;”.

Insertion of new section 154C. 91. After section 154B of the Customs Act, the following section shall be inserted, namely:––

namely:––

“(ca) by making it available on the common portal;”.

Insertion of new section 154C. 91. After section 154B of the Customs Act, the following section shall be inserted, namely:––

Common Customs Electronic Portal. “154C. The Board may notify a common portal, to be called the Common Customs Electronic Portal, for facilitating registration, filing of bills of entry, shipping bills, other documents and forms prescribed under this Act or under any other law for the time being in force or the rules or regulations made thereunder, payment of duty and for such other purposes, as the Board may, by notification, specify.”.

Customs tariff

Amendment of section 8B. 92. In the Customs Tariff Act, 1975 (hereinafter referred to as the Customs Tariff Act), in section 8B, in sub-section (6),––

(i) in clause (i), for the word “unit;”, the words “unit; or”

(ii) for the Explanation, the following Explanation shall be substituted, namely:–

‘Explanation.––For the purposes of this sub-section,–

(a) the expression “hundred per cent. export- oriented undertaking” shall have the same meaning as assigned to it in clause (i) of Explanation 2 to sub- section (1) of section 3 of the Central Excise Act, 1944;

(b) the expression “special economic zone” shall have the same meaning as assigned to it in clause (za) of section 2 of the Special Economic Zones Act, 2005.’.

51 of 1975.

1 of 1944.

28 of 2005. Amendment of section 9. 93.

s assigned to it in clause (za) of section 2 of the Special Economic Zones Act, 2005.’.

51 of 1975.

1 of 1944.

28 of 2005. Amendment of section 9. 93. In section 9 of the Customs Tariff Act,––

(i) in sub-section (1A), after the words “such other article also”, the words “from such date, not earlier than the date of initiation of the inquiry, as the Central Government may, by notification in the Official Gazette, specify” shall be inserted;

(ii) after sub-section (1A), the following sub-section shall be inserted, namely:––

‘(1B) Where the Central Government, on such inquiry as it considers necessary, is of the opinion that absorption of countervailing duty imposed under sub-section (1) has taken place whereby the countervailing duty so imposed is rendered ineffective, it may modify such duty to counter the effect of such absorption, from such date, not earlier than the date of

initiation of the inquiry, as the Central Government may, by notification in the Official Gazette, specify.

ounter the effect of such absorption, from such date, not earlier than the date of

initiation of the inquiry, as the Central Government may, by notification in the Official Gazette, specify.

Explanation.––For the purposes of this sub-section, “absorption of countervailing duty” is said to have taken place,–

(a) if there is a decrease in the export price of an article without any commensurate change in the resale price in India of such article imported from the exporting country or territory; or

(b) under such other circumstances as may be provided by rules.’;

(iii) after sub-section (2), the following sub-section shall be inserted, namely: –

‘(2A) Notwithstanding anything contained in sub-sections (1) and (2), a notification issued under sub-section (1) or any countervailing duty imposed under sub-section (2) shall not apply to article imported by a hundred per cent. export-oriented undertaking or a unit in a special economic zone, unless, —

(i) it is specifically made applicable in such notification or to such undertaking or unit; or

(ii) such article is either cleared as such into the domestic tariff area or used in the manufacture of any goods that are cleared into the domestic tariff area, in which case, countervailing duty shall be imposed on that portion of the article so cleared or used, as was applicable when it was imported into India.

Explanation.––For the purposes of this sub-section,––

(a) the expression “hundred per cent.

that portion of the article so cleared or used, as was applicable when it was imported into India.

Explanation.––For the purposes of this sub-section,––

(a) the expression “hundred per cent. export-oriented undertaking” shall have the same meaning as assigned to it in clause (i) of Explanation 2 to sub-section (1) of section 3 of the Central Excise Act, 1944;

(b) the expression “special economic zone” shall have the same meaning as assigned to it in clause (za) of section 2 of the Special Economic Zones Act, 2005.’;

(iv) in sub-section (6),––

(a) in the first proviso, for the words “of five years”, the words “upto five years” shall be substituted;

1 of 1944.

28 of 2005.

(b) after the second proviso, the following proviso shall be inserted, namely:––

“Provided also that if the said duty is revoked temporarily, the period of such revocation shall not exceed one year at a time.”.

Amendment of section 9A. 94.

shall be inserted, namely:––

“Provided also that if the said duty is revoked temporarily, the period of such revocation shall not exceed one year at a time.”.

Amendment of section 9A. 94. In section 9A of the Customs Tariff Act,––

(i) in sub-section (1A), after the words “as the case may be”, the words “, from such date, not earlier than the date of initiation of the inquiry, as the Central Government may, by notification in the Official Gazette, specify” shall be inserted;

(ii) after sub-section (1A), the following sub-section shall be inserted, namely:––

‘(1B) Where the Central Government, on such inquiry as it may consider necessary, is of the opinion that absorption of anti-dumping duty imposed under sub-section (1) has taken place whereby the anti-dumping duty so imposed is rendered ineffective, it may modify such duty to counter the effect of such absorption, from such date, not earlier than the date of initiation of the inquiry, as the Central Government may, by notification in the Official Gazette, specify.

y to counter the effect of such absorption, from such date, not earlier than the date of initiation of the inquiry, as the Central Government may, by notification in the Official Gazette, specify.

Explanation.––For the purposes of this sub-section, “absorption of anti-dumping duty” is said to have taken place,––

(a) if there is a decrease in the export price of an article without any commensurate change in the cost of production of such article or export price of such article to countries other than India or resale price in India of such article imported from the exporting country or territory; or

(b) under such other circumstances as may be provided by rules.’;

(iii) for sub-section (2A), the following sub-section shall be

‘(2A) Notwithstanding anything contained in sub-section (1) and sub-section (2), a notification issued under sub- section (1) or any anti-dumping duty imposed under sub- section (2) shall not apply to articles imported by a hundred per cent. export-oriented undertaking or a unit in a special economic zone, unless,—

n (1) or any anti-dumping duty imposed under sub- section (2) shall not apply to articles imported by a hundred per cent. export-oriented undertaking or a unit in a special economic zone, unless,—

(i) it is specifically made applicable in such notification or to such undertaking or unit; or

(ii) such article is either cleared as such into the domestic tariff area or used in the manufacture of any goods that are cleared into the domestic tariff area, in which case, anti- dumping duty shall be imposed on that portion of the article so cleared or used, as was applicable when it was imported into India.

Explanation.––For the purposes of this section,––

(a) the expression “hundred per cent. export-oriented undertaking” shall have the same meaning as assigned to it in clause (i) of Explanation 2 to sub-section (1) of section 3 of the Central Excise Act, 1944;

(b) the expression “special economic zone” shall have the same meaning as assigned to it in clause (za) of section 2 of the Special Economic Zones Act, 2005.’;

(iv) in sub-section (5),––

(a) in the first proviso, for the words “of five years”, the words “upto five years” shall be substituted;

(b) after the second proviso, the following proviso shall be inserted, namely:–

“Provided also that if the said duty is revoked temporarily, the period of such revocation shall not exceed one year at a time.”.

1 of 1944.

28 of 2005. Amendment of First Schedule. 95.

oked temporarily, the period of such revocation shall not exceed one year at a time.”.

1 of 1944.

28 of 2005. Amendment of First Schedule. 95. In the Customs Tariff Act, the First Schedule shall––

(i) be amended in the manner specified in the Second Schedule;

(ii) with effect from the 1st April, 2021, be also amended in the manner specified in the Third Schedule; and

(iii) with effect from the 1st January, 2022, be also amended in the manner specified in the Fourth Schedule.

Excise

Amendment of Fourth Schedule. 96. In the Central Excise Act, 1944 (hereinafter referred to as the Central Excise Act), the Fourth Schedule shall,––

1 of 1944.

(i) with effect from the 1st April, 2021, be amended in the manner specified in the Fifth Schedule; and

(ii) with effect from the 1st January, 2022, be also amended in the manner specified in the Sixth Schedule.

Amendment of Chapter 27 of Fourth Schedule. 97.

ed in the Fifth Schedule; and

(ii) with effect from the 1st January, 2022, be also amended in the manner specified in the Sixth Schedule.

Amendment of Chapter 27 of Fourth Schedule. 97. In the Fourth Schedule to the Central Excise Act, in Chapter 27, with effect from the 1st day of January, 2020,––

(i) for the entry in column (2) occurring against tariff item 2710 12 49, the entry “---- M15 Fuel conforming to standard IS 17076” shall be substituted and shall be deemed to have been substituted;

(ii) for the entry in column (4) occurring against tariff item 2710 20 10, the entry “14% + Rs.15.00 per litre” shall be substituted and shall be deemed to have been substituted;

(iii) for the entry in column (4) occurring against tariff item 2710 20 20, the entry “14% + Rs.15.00 per litre” shall be substituted and shall be deemed to have been substituted.

Revised date of effect to amendments made in Fourth Schedule vide notification issued under section 3C of Central Excise Act, 1944.

Notwithstanding anything contained in paragraph 2 of the notification of the Government of India in the Ministry of Finance (Department of Revenue) number G.S.R 978 (E), dated the 31st December, 2019, issued in exercise of the powers conferred under section 3C of the Central Excise Act, 1944, the amendments made in Chapter 27 of the Fourth Schedule thereto by the said notification shall be deemed to have, and always to have had effect, for all purposes, on and from the 1st day of January, 2020.

1 of 1944.

7 of the Fourth Schedule thereto by the said notification shall be deemed to have, and always to have had effect, for all purposes, on and from the 1st day of January, 2020.

1 of 1944.

Central Goods and Services Tax

Amendment of section 7.

In the Central Goods and Services Tax Act, 2017 (hereinafter referred as the Central Goods and Services Tax Act), in section 7, in sub-section (1), after clause (a), the following clause shall be inserted and shall be deemed to have been inserted with effect from the 1st day of July, 2017, namely:––

12 of 2017. “(aa) the activities or transactions, by a person, other than an individual, to its members or constituents or vice- versa, for cash, deferred payment or other valuable consideration.

 Explanation.––For the purposes of this clause, it is

hereby clarified that, notwithstanding anything contained in any other law for the time being in force or any judgment, decree or order of any Court, tribunal or authority, the person and its members or constituents shall be deemed to be two separate persons and the supply of

e time being in force or any judgment, decree or order of any Court, tribunal or authority, the person and its members or constituents shall be deemed to be two separate persons and the supply of

activities or transactions inter se shall be deemed to take place from one such person to another;”.

Amendment of section 16. 100. In section 16 of the Central Goods and Services Tax Act, in sub-section (2), after clause (a), the following clause shall be inserted, namely:––

“(aa) the details of the invoice or debit note referred to in clause (a) has been furnished by the supplier in the statement of outward supplies and such details have been communicated to the recipient of such invoice or debit note in the manner specified under section 37;”.

Amendment of section 35. 101. In section 35 of the Central Goods and Services Tax Act, sub-section (5) shall be omitted.

Substitution of new section for section 44.

For section 44 of the Central Goods and Services Tax Act, the following section shall be substituted, namely:–– Annual return. “44.

tted.

Substitution of new section for section 44.

For section 44 of the Central Goods and Services Tax Act, the following section shall be substituted, namely:–– Annual return. “44. Every registered person, other than an Input Service Distributor, a person paying tax under section 51 or section 52, a casual taxable person and a non-resident taxable person shall furnish an annual return which may include a self- certified reconciliation statement, reconciling the value of supplies declared in the return furnished for the financial year, with the audited annual financial statement for every financial year electronically, within such time and in such form and in such manner as may be prescribed:

Provided that the Commissioner may, on the recommendations of the Council, by notification, exempt any class of registered persons from filing annual return under this section:

Provided further that nothing contained in this section shall apply to any department of the Central Government or a State Government or a local authority, whose books of account are subject to audit by the Comptroller and Auditor- General of India or an auditor appointed for auditing the accounts of local authorities under any law for the time being in force.”.

Amendment of section 50. 103.

the Comptroller and Auditor- General of India or an auditor appointed for auditing the accounts of local authorities under any law for the time being in force.”.

Amendment of section 50. 103. In section 50 of the Central Goods and Services Tax Act, in sub-section (1), for the proviso, the following proviso shall be substituted and shall be deemed to have been substituted with effect from the 1st day of July, 2017, namely:––

“Provided that the interest on tax payable in respect of supplies made during a tax period and declared in the return for the said period furnished after the due date in

accordance with the provisions of section 39, except where such return is furnished after commencement of any proceedings under section 73 or section 74 in respect of the said period, shall be payable on that portion of the tax which is paid by debiting the electronic cash ledger.”.

Amendment of section 74. 104. In section 74 of the Central Goods and Services Tax Act, in Explanation 1, in clause (ii), for the words and figures “sections 122, 125, 129 and 130”, the words and figures “sections 122 and 125” shall be substituted.

Amendment of section 75. 105. In section 75 of the Central Goods and Services Tax Act, in sub-section (12), the following Explanation shall be inserted, namely:––

‘Explanation.––For the purposes of this sub-section, the expression "self-assessed tax" shall include the tax payable in respect of details of outward supplies furnished under section 37, but not included in the return furnished under section 39.’.

the expression "self-assessed tax" shall include the tax payable in respect of details of outward supplies furnished under section 37, but not included in the return furnished under section 39.’.

Amendment of section 83. 106. In section 83 of the Central Goods and Services Tax Act, for sub-section (1), the following sub-section shall be substituted, namely:––

“(1) Where, after the initiation of any proceeding under Chapter XII, Chapter XIV or Chapter XV, the Commissioner is of the opinion that for the purpose of protecting the interest of the Government revenue it is necessary so to do, he may, by order in writing, attach provisionally, any property, including bank account, belonging to the taxable person or any person specified in sub-section (1A) of section 122, in such manner as may be prescribed.”.

Amendment of section 107. 107. In section 107 of the Central Goods and Services Tax Act, in sub-section (6), the following proviso shall be inserted, namely:––

“Provided that no appeal shall be filed against an order under sub-section (3) of section 129, unless a sum equal to twenty-five per cent. of the penalty has been paid by the appellant.”.

Amendment of section 129. 108. In section 129 of the Central Goods and Services Tax Act, ––

(i) in sub-section (1), for clauses (a) and (b), the following clauses shall be substituted, namely:––

“(a) on payment of penalty equal to two hundred per cent. of the tax payable on such goods and, in case of

on (1), for clauses (a) and (b), the following clauses shall be substituted, namely:––

“(a) on payment of penalty equal to two hundred per cent. of the tax payable on such goods and, in case of

exempted goods, on payment of an amount equal to two per cent. of the value of goods or twenty-five thousand rupees, whichever is less, where the owner of the goods comes forward for payment of such penalty;

(b) on payment of penalty equal to fifty per cent. of the value of the goods or two hundred per cent. of the tax payable on such goods, whichever is higher, and in case of exempted goods, on payment of an amount equal to five per cent. of the value of goods or twenty-five thousand rupees, whichever is less, where the owner of the goods does not come forward for payment of such penalty;”;

(ii) sub-section (2) shall be omitted;

(iii) for sub-section (3), the following sub-section shall be

“(3) The proper officer detaining or seizing goods or conveyance shall issue a notice within seven days of such detention or seizure, specifying the penalty payable, and thereafter, pass an order within a period of seven days from the date of service of such notice, for payment of penalty under clause (a) or clause (b) of sub-section (1).”;

(iv) in sub-section (4), for the words “No tax, interest or penalty”, the words “No penalty” shall be substituted;

ice, for payment of penalty under clause (a) or clause (b) of sub-section (1).”;

(iv) in sub-section (4), for the words “No tax, interest or penalty”, the words “No penalty” shall be substituted;

(v) for sub-section (6), the following sub-section shall be

“(6) Where the person transporting any goods or the owner of such goods fails to pay the amount of penalty under sub-section (1) within fifteen days from the date of receipt of the copy of the order passed under sub-section (3), the goods or conveyance so detained or seized shall be liable to be sold or disposed of otherwise, in such manner and within such time as may be prescribed, to recover the penalty payable under sub-section (3):

Provided that the conveyance shall be released on payment by the transporter of penalty under sub-section (3) or one lakh rupees, whichever is less:

Provided further that where the detained or seized goods are perishable or hazardous in nature or are likely to depreciate in value with passage of time, the said period of fifteen days may be reduced by the proper officer.”.

e detained or seized goods are perishable or hazardous in nature or are likely to depreciate in value with passage of time, the said period of fifteen days may be reduced by the proper officer.”.

Amendment of section 130. 109. In section 130 of the Central Goods and Services Tax Act,––

(a) in sub-section (1), for the words “Notwithstanding anything contained in this Act, if ”, the word “Where” shall be substituted;

(b) in sub-section (2), in the second proviso, for the words, brackets and figures “amount of penalty leviable under sub-section (1) of section 129”, the words “penalty equal to hundred per cent. of the tax payable on such goods”

Substitution of new section for section 151.

For section 151 of the Central Goods and Services Tax Act, the following section shall be substituted, namely: ––

Power to call for information.
“151. The Commissioner or an officer authorised by him may, by an order, direct any person to furnish information relating to any matter dealt with in connection with this Act, within such time, in such form, and in such manner, as may be specified therein.”.

Amendment of section 152. 111.

sh information relating to any matter dealt with in connection with this Act, within such time, in such form, and in such manner, as may be specified therein.”.

Amendment of section 152. 111. In section 152 of the Central Goods and Services Tax Act,––

(a) in sub-section (1),––

(i) the words “of any individual return or part thereof” shall be omitted;

(ii) after the words “any proceedings under this Act”, the words “without giving an opportunity of being heard to the person concerned” shall be inserted;

(b) sub-section (2) shall be omitted.

Amendment of section 168. 112. In section 168 of the Central Goods and Services Tax Act, in sub-section (2),––

(i) for the words, brackets and figures “sub-section (1) of section 44”, the word and figures “section 44” shall be substituted;

(ii) the words, brackets and figures “sub-section (1) of section 151,” shall be omitted.

Amendment to Schedule II. 113. In Schedule II of the Central Goods and Services Tax Act, paragraph 7 shall be omitted and shall be deemed to have been omitted with effect from the 1st day of July, 2017.

Integrated Goods and Services Tax

Amendment of section 16. 114.

x Act, paragraph 7 shall be omitted and shall be deemed to have been omitted with effect from the 1st day of July, 2017.

Integrated Goods and Services Tax

Amendment of section 16. 114. In the Integrated Goods and Services Tax Act, 2017, in section 16, ––

13 of 2017. (a) in sub-section (1), in clause (b), after the words “supply of goods or services or both”, the words “for authorised operations” shall be inserted;

(b) for sub-section (3), the following sub-sections shall be

“(3) A registered person making zero rated supply shall be eligible to claim refund of unutilised input tax credit on supply of goods or services or both, without payment of integrated tax, under bond or Letter of Undertaking, in accordance with the provisions of section 54 of the Central Goods and Services Tax Act or the rules made thereunder, subject to such conditions, safeguards and procedure as may be prescribed:

Provided that the registered person making zero rated supply of goods shall, in case of non-realisation of sale proceeds, be liable to deposit the refund so received under this sub-section along with the applicable interest under section 50 of the Central Goods and Services Tax Act within thirty days after the expiry of the time limit prescribed under the Foreign Exchange Management Act, 1999 for receipt of foreign exchange remittances, in such manner as may be prescribed.

42 of 1999.

the expiry of the time limit prescribed under the Foreign Exchange Management Act, 1999 for receipt of foreign exchange remittances, in such manner as may be prescribed.

42 of 1999. (4) The Government may, on the recommendation of the Council, and subject to such conditions, safeguards and procedures, by notification, specify––

(i) a class of persons who may make zero rated supply on payment of integrated tax and claim refund of the tax so paid;

(ii) a class of goods or services which may be exported on payment of integrated tax and the supplier of such goods or services may claim the refund of tax so paid.”.

CHAPTER V

AGRICULTURE INFRASTRUCTURE AND DEVELOPMENT CESS

Agriculture Infrastructure and Development Cess
on imported goods.

(1) There shall be levied and collected, in accordance with the provisions of this section, for the purposes of the Union, a duty of customs, to be called Agriculture Infrastructure and Development Cess, on the goods specified in the First Schedule to the Customs Tariff Act, 1975 (hereinafter referred to as the Customs Tariff Act), being the goods imported into India, at the rate not exceeding the rate of customs duty as specified in the said Schedule, for the purposes of financing the agriculture infrastructure and other development expenditure.

51 of 1975.

rate not exceeding the rate of customs duty as specified in the said Schedule, for the purposes of financing the agriculture infrastructure and other development expenditure.

51 of 1975. (2) The Central Government may, after due appropriation made by Parliament by law in this behalf, utilise such sums of money of the Agriculture Infrastructure and Development Cess levied under this section for the purposes specified in sub-section (1), as it may consider necessary.

(3) Where the duty is leviable on the goods at any percentage of its value, then, for the purposes of calculating the Agriculture Infrastructure and Development Cess under this section, the value of such goods shall be calculated in the same manner as the value of goods is calculated for the purpose of customs duty under section 14 of the Customs Act, 1962.

52 of 1962. (4) The Agriculture Infrastructure and Development Cess on imported goods shall be in addition to any other duties of customs chargeable on such goods, under the Customs Act, 1962 or any other law for the time being in force.

52 of 1962.

ment Cess on imported goods shall be in addition to any other duties of customs chargeable on such goods, under the Customs Act, 1962 or any other law for the time being in force.

52 of 1962.

(5) The provisions of the Customs Act, 1962 and the rules and regulations made thereunder, including those relating to assessment, non-levy, short-levy, refund, exemptions, interest, appeals, offences, and penalties shall, as far as may be, apply in relation to the levy and collection of the Agriculture Infrastructure and Development Cess on imported goods as they apply in relation to the levy and collection of duties of customs on such goods under the said Act, or the rules or regulations, as the case maybe.

52 of 1962. Agriculture Infrastructure and Development Cess
on excisable goods.

(1) There shall be levied and collected, in accordance with the provisions of this section, for the purposes of the Union, an additional duty of excise, to be called Agriculture Infrastructure and Development Cess, on the goods specified in the Seventh Schedule (hereinafter referred to as scheduled goods), being the goods manufactured or produced, at the rates specified in column (3) of the said Schedule, for the purposes of

fied in the Seventh Schedule (hereinafter referred to as scheduled goods), being the goods manufactured or produced, at the rates specified in column (3) of the said Schedule, for the purposes of

financing the agriculture infrastructure and other development expenditure.

(2) The Central Government may, after due appropriation made by Parliament by law in this behalf, utilise such sums of money of the Agriculture Infrastructure and Development Cess levied under this section for the purposes specified in sub-section (1), as it may consider necessary.

(3) The cess leviable under sub-section (1), chargeable on the scheduled goods, shall be in addition to any other duties of excise chargeable on such goods under the Central Excise Act, 1944 or any other law for the time being in force.

1 of 1944.

(4) The provisions of the Central Excise Act, 1944 and the rules and the regulations made thereunder, including those relating to assessment, non-levy, short-levy, refund, exemptions, interest, appeals, offences, and penalties shall, as far as may be, apply in relation to the levy and collection of the cess leviable under this section in respect of scheduled goods as they apply in relation to the levy and collection of duties of excise on such goods under the said Act or the rules or regulations, as the case maybe.

1 of 1944.

CHAPTER VI

MISCELLANEOUS

PART I

AMENDMENT TO THE INDIAN STAMP ACT, 1899

Insertion of new section 8G. 117.

the said Act or the rules or regulations, as the case maybe.

1 of 1944.

CHAPTER VI

MISCELLANEOUS

PART I

AMENDMENT TO THE INDIAN STAMP ACT, 1899

Insertion of new section 8G. 117. In the Indian Stamp Act, 1899, after section 8F, the following section shall be inserted, namely:––

2 of 1899. Strategic sale, disinvestment, etc., of immovable property by Government company not liable to stamp duty. “8G. Notwithstanding anything contained in this Act or any other law for the time being in force, any instrument for conveyance or transfer of a business or asset or right in any immovable property from a Government company, its subsidiary, unit or joint venture, by way of strategic sale or disinvestment or demerger or any other scheme of arrangement, to another Government company or to the Central Government or any State Government, after the approval of the Central Government, shall not be liable to duty under this Act.

Explanation.––For the purposes of this section, “Government company” shall have the same meaning as assigned to it in clause (45) of section 2 of the Companies Act, 2013.”.

18 of 2013.

Explanation.––For the purposes of this section, “Government company” shall have the same meaning as assigned to it in clause (45) of section 2 of the Companies Act, 2013.”.

18 of 2013.

PART II

AMENDMENT TO THE CONTINGENCY FUND OF INDIA ACT, 1950

Amendment of Act 49 of 1950. 118. In section 2 of the Contingency Fund of India Act, 1950, after sub-section (2), the following sub-section shall be inserted, namely:––

“(3) On and from the date on which the Finance Bill, 2021 receives the assent of the President, the sum which shall be paid from and out of the Consolidated Fund of India into the Contingency Fund of India under sub-section (2) shall stand enhanced to thirty thousand crores of rupees.”.

PART III

AMENDMENTS TO THE LIFE INSURANCE CORPORATION ACT, 1956

Commencement of this Part. 119. The provisions of this Part shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint:

Provided that different dates may be appointed for different provisions of this Part and any reference in any such provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision.

Amendment of section 2.

In the Life Insurance Corporation Act, 1956 (hereinafter in this Part referred to as the principal Act), in section 2,—

31 of 1956.

orce of that provision.

Amendment of section 2.

In the Life Insurance Corporation Act, 1956 (hereinafter in this Part referred to as the principal Act), in section 2,—

31 of 1956.

(i) after clause (1), the following clauses shall be inserted, namely:—

‘(1a) “Audit Committee” means the Committee constituted under section 19C;

(1b) “Board of Directors” or “Board” means the collective body of the directors appointed or nominated or deemed as such under section 4;

(1c) “Chairperson” means the Chairperson referred to in clause (a) of sub-section (2) of section 4;

(1d) “Companies Act” means the Companies Act, 2013;

18 of 2013.

(1e) “court” means “Court” as defined in clause (29) of section 2 of the Companies Act, 2013;’;

18 of 2013.

(ii) after clause (4), the following clauses shall be inserted, namely:—

‘(4a) “director” means a director appointed or nominated or deemed as such under section 4;

(4b) “financial statement”, in relation to the Corporation, includes—

(i) a balance-sheet as at the end of the financial year;

(ii) a profit and loss account for the financial year;

(iii) cash flow statement for the financial year;

(iv) a statement of changes in equity, if applicable; and

(v) any explanatory note annexed to, or forming part of, any document referred to in sub-clause (i) to sub-clause (iv);

ial year;

(iv) a statement of changes in equity, if applicable; and

(v) any explanatory note annexed to, or forming part of, any document referred to in sub-clause (i) to sub-clause (iv);

(4c) “fully diluted basis” shall mean, in relation to the percentage holding of the Central Government on such basis, the total number of shares held by the Central Government expressed as a percentage of the total number of shares of the Corporation that would be outstanding if all possible sources of conversion are exercised;

(4d) “independent director” means an independent director referred to in clause (f) of sub-section (2) of section 4;’;

(iii) after clause (6), the following clause shall be inserted, namely:—

‘(6a) “Managing Director” means a Managing Director referred to in clause (b) of sub-section (2) of section 4;’;

(iv) for clause (7), the following clauses shall be substituted, namely:—

‘(7) “member” means every person holding shares of the Corporation and whose name is entered in the register

;’;

(iv) for clause (7), the following clauses shall be substituted, namely:—

‘(7) “member” means every person holding shares of the Corporation and whose name is entered in the register

of members maintained under clause (a) of sub-section (1) of section 5C;

(7a) “Nomination and Remuneration Committee” means the Committee constituted under section 19B;

(7b) “notification” means a notification published in the Official Gazette, and the expression “notify” shall be construed accordingly;’;

(v) after clause (8), the following clause shall be inserted, namely:—

‘(8a) “special resolution” means a resolution for which the intention to propose the same as a special resolution has been duly specified in the notice given to members for calling a general meeting, and the votes cast in favour of the resolution by members are not less than three times the number of votes, if any, cast against the resolution;’;

(vi) for clause (10), the following clause shall be

“(10) unless there is anything repugnant in the subject or context, all the words and expressions used herein but not defined and defined in the Insurance Act, 1938 or in the Companies Act, 2013 shall have the meanings respectively assigned to them in the said Acts.”.

4 of 1938. 18 of 2013.

Substitution of section 4. 121. For section 4 of the principal Act, the following sections shall be substituted, namely:––

Board of Directors. ‘4.

ts.”.

4 of 1938. 18 of 2013.

Substitution of section 4. 121. For section 4 of the principal Act, the following sections shall be substituted, namely:––

Board of Directors. ‘4. (1) The general superintendence and direction of the affairs and business of the Corporation shall vest in its Board of Directors, which may exercise all such powers and do all such acts and things as may be exercised or done by the Corporation and are not by this Act expressly directed or required to be done by the Corporation in general meeting.

(2) The Board of Directors of the Corporation shall consist of the following directors, not exceeding fifteen, of whom at least one shall be a woman, namely:—

(a) a Chairperson of the Board, to be appointed by the Central Government, who shall be a whole-time director of the Corporation;

(b) Managing Directors, not exceeding four, to be appointed
by the Central Government, who shall be whole-time directors of the Corporation;

(c) not more than two officers of the Central Government not below the rank of a Joint Secretary to the Government of India, to be nominated by the Central Government;

s of the Corporation;

(c) not more than two officers of the Central Government not below the rank of a Joint Secretary to the Government of India, to be nominated by the Central Government;

(d) not more than two individuals, to be nominated by the Central Government, who have special knowledge or practical experience in actuarial science, business management, economics, finance, human resources, information technology, insurance, law, risk management, or any other field the special knowledge or practical experience of which would be useful to the Corporation in the opinion of the Central Government or who represent the interests of policyholders;

(e) where the total holding of members other than the Central Government in the paid-up equity capital of the Corporation is––

(i) not more than ten per cent., one individual;

(ii) more than ten per cent. but not more than

twenty-five per cent., two individuals; and

(iii) more than twenty-five per cent., three individuals,

elected by such members in such manner as may be specified by regulations, to be appointed by the Board;

(f) such number of independent directors, not exceeding three, to be recommended by the Nomination and Remuneration Committee and appointed by the Board;

(g) at any time when the number of directors to be elected under clause (e) is less than three, either due to the total holding of members other than the Central Government in the paid-up equity capital of the Corporation being not more than twenty-five per cent.

ause (e) is less than three, either due to the total holding of members other than the Central Government in the paid-up equity capital of the Corporation being not more than twenty-five per cent. or due to vacancy in elected directors, the Board may co-opt such number of individuals as independent directors who taken together with elected directors shall not exceed three:

Provided that such co-opted directors shall be recommended by the Nomination and Remuneration Committee and appointed by the Board, and shall continue to be directors until elected directors assume charge, whereupon

an equal number of such co-opted independent directors shall retire in the order of their co-option.

(3) An independent director of the Corporation shall, in relation to the Corporation, meet the same criteria of independence as an independent director of a company is required to meet in relation to the company under sub-section (6) of section 149 of the Companies Act:

Provided that such a director shall also meet, in addition to the aforesaid criteria, any criteria that the Nomination and Renumeration Committee may formulate regarding qualifications, positive attributes and independence:

Provided further that every such director shall at the first meeting of the Board in which he participates as a director and thereafter at the first meeting of the Board in every financial year or whenever there is any change in the circumstances which may affect his status as an independent director, give a declaration that he meets the criteria of

of the Board in every financial year or whenever there is any change in the circumstances which may affect his status as an independent director, give a declaration that he meets the criteria of independence under this sub-section and that he is not aware of any circumstance or situation, which exist or may reasonably be anticipated, that could impair or impact his ability to discharge his duties with an objective independent judgment and without any external influence.

(4) An individual appointed by the Board as a director under clause (e) or clause (f) or clause (g) of sub-section (2) shall hold office up to the date of the next annual general meeting or the last date on which the annual general meeting should have been held, whichever is earlier, and shall hold office beyond such date only if his appointment is approved at the annual general meeting.

(5) Before an individual is appointed or nominated as a director under sub-section (2), the Central Government or the Nomination and Remuneration Committee, as the case may be, shall satisfy itself that such an individual as a director shall have no financial or other interest as is likely to affect prejudicially the exercise or performance by him of the functions of a director:

Provided that the Board shall satisfy itself from time to time with respect to every director other than a director nominated under clause (c) of sub-section (2) that he has no such interest:

Provided further that, for the purposes of this sub- section, any individual who is, or whose appointment or

rector nominated under clause (c) of sub-section (2) that he has no such interest:

Provided further that, for the purposes of this sub- section, any individual who is, or whose appointment or nomination or election is proposed and who has consented to

be a director, shall furnish such information as the Central Government or the Nomination and Remuneration Committee or the Board, as the case may be, may require.

(6) Notwithstanding anything contained in sub-section (2), on and from the appointed date, an individual appointed under section 4 who is eligible to be or remain a director under section 4A and who, immediately before such appointed date, held the office of a member of the Corporation—

(i) in the capacity as the Chairman of the Corporation, shall be deemed to be a director and the Chairperson under clause (a) of sub-section (2);

(ii) in the capacity as a Managing Director of the Corporation, shall be deemed to be a director and a Managing Director under clause (b) of sub-section (2);

(iii) and is an officer of the Central Government not below the rank of a Joint Secretary to the Government of India, shall be deemed to be a director nominated under clause (c) of sub-section (2);

iii) and is an officer of the Central Government not below the rank of a Joint Secretary to the Government of India, shall be deemed to be a director nominated under clause (c) of sub-section (2);

(iv) and has been in office for a duration which is the longest or the second longest amongst members other than members referred to in clauses (i), (ii) and (iii), shall be deemed to be a director nominated under clause (d) of sub-section (2):

Provided that every such individual shall hold office until expiry of the term, if any, specified at the time of his appointment as a member of the Corporation, or until a director appointed or nominated, as the case may be, under sub-section (2) in place of such an individual assumes office:

Provided further that any act or proceeding of the collective body of members constituting the Corporation under section 4 before the appointed date, shall be deemed to be an act or proceeding, as the case may be, of the Board.

Explanation.—For the purposes of this sub-section,––

(a) notwithstanding anything contained in clause (7) of section 2, the expression “member” shall mean a member appointed to the Corporation constituted under section 4 [as it stood before the coming into force of section 121 of the Finance Act, 2021];

section 2, the expression “member” shall mean a member appointed to the Corporation constituted under section 4 [as it stood before the coming into force of section 121 of the Finance Act, 2021];

(b) “appointed date” means the date on which the provisions of section 121 of the Finance Act, 2021 shall come into force.

Disqualification to be director. 4A. An individual shall not be eligible to be or remain a director if,—

(a) he is of unsound mind and stands so declared by a competent court;

(b) he is an undischarged insolvent;

(d) he has been convicted by a court of any offence, whether involving moral turpitude or otherwise, and sentenced in respect thereof to imprisonment for not less than six months and a period of five years has not elapsed from the date of expiry of the sentence:

Provided that if an individual has been convicted of any offence and sentenced in respect thereof to imprisonment for a period of seven years or more, he shall not be eligible to be a director;

(e) an order disqualifying him to be a director has been passed by a court or the National Company Law Tribunal constituted under section 408 of the Companies Act, and the order is in force;

(f) he has been convicted of the offence dealing with related party transactions under section 188 of the Companies Act or under any other law for the time being in force during the preceding five years;

has been convicted of the offence dealing with related party transactions under section 188 of the Companies Act or under any other law for the time being in force during the preceding five years;

(g) he has not paid any calls in respect of any shares of the Corporation held by him, whether alone or jointly with others, and six months have elapsed from the last day fixed for the payment of such call;

(h) he has not complied with the provisions of sub- section (i) of section 165 of the Companies Act;

(i) he is disqualified from being appointed as a director of a company under sub-section (2) of section 164 of the Companies Act;

(j) he is a salaried government official, other than an individual nominated director under clause (c) of sub- section (2) of section 4;

(k) he is an insurance agent or an intermediary or an insurance intermediary;

(l) he is an employee of the Corporation, other than the Chairperson or a Managing Director, or of its subsidiary or associate company;

(m) he is a director of a subsidiary or an associate company of the Corporation and is other than the Chairperson or a Managing Director;

(n) he is an employee or a director or a promoter of any insurer carrying on life insurance business anywhere in the world, other than the Corporation or its subsidiary or associate company, or of any holding company, subsidiary or associate company of such an insurer;

on life insurance business anywhere in the world, other than the Corporation or its subsidiary or associate company, or of any holding company, subsidiary or associate company of such an insurer;

(o) he absents himself from all the meetings of the Board held during a period of twelve months, with or without seeking leave of absence of the Board:

Provided that the disqualifications referred to in clauses (d), (e) and (f) shall continue to apply even if an appeal or petition has been filed against the order of conviction or disqualification.

Disclosure of interest by director and senior management. 4B. (1) Every director shall at the first meeting of the Board in which he participates as a director and thereafter at the first meeting of the Board in every financial year, or whenever there is any change in the disclosures already made, then at the first Board meeting held after such change, disclose his concern or interest in any body corporate, which shall include shareholding, in such manner as may be prescribed.

(2) Every director who is in any way, whether directly or indirectly, concerned or interested in a contract or arrangement or proposed contract or ar

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