We are the honest taxpayer of the country and we were regular in paying our taxes to the nation and in return expecting a safe & secure environment for our family from the government administrator. we were supposed to get all kinds of relief from the government in case of any emergency and for this reason, only we were paying taxes to the exchequers.
Section 9B
A new section 9B which was not proposed while presenting the Finance
Bill 2021 on 1st Feb 2021 has been added during the passage of the bill in the
parliament. The aim is to plug the loophole on tax leakage arising from the
reconstitution of the firm or AOP.
1. Following event (Specified event) took place
in the Partnership firm/AOP/BOI (FIRM)
a)
Dissolution
b)
Change in Profit Sharing ratio
c)
Retirement
of Partner
d) New Person is admitted as a partner in FIRM
TDS disallowance for Trust.
Section 40(a) not applicable in case of charitable trust or institution
The
question for consideration is as to whether the provisions of Section 40(a)(ia)
is applicable for computing the
income chargeable under the head “Profits and gains of business or profession” or computation of income under
any other heads of
income also.
Section 40 clearly stipulates that “Notwithstanding anything to the contrary in Sections 30 to 38, the following amounts shall not be deducted in computing the income chargeable under the head “Profits and gains of business or profession”.
The legislatures first time recognize the power of the Tribunal to stay demand legislature by insertion of Section 253 (7) which provided for levy of fees on application for stay of demand. Prior to this insertion, the power of the Appellate Tribunal to grant stay was held to be incidental or ancillary to its appellate jurisdiction. Stay was granted in most deserving and appropriate cases where the tribunal was satisfied that the entire purpose of the appeal will be frustrated or rendered nugatory by allowing the recovery proceedings to continue during the pendency of the appeal.
|
Section amended |
Existing provisions of the Income-tax Act, 1961 |
Amendment proposed in Finance Bill 2021 |
Amendment finally incorporated in the Finance Act,
2021 |
Remarks, if any |
|
Section 2(29A) |
No provision prior to introduction by Finance Bill, 2021. |
Finance Bill,
2021, proposed to insert sub-section
(29A) to section 2 of the Act to
define the term ‘liable to tax’ as under: “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” |
The said sub-section (29A)
to section 2 introduced by Finance Bill,
2021 stands substituted as under: “liable to tax”, in relation to a person and with reference to a country, means that there is an income-tax liability on such person under
the law of that country
for the time being in force
and shall include a person who has subsequently been exempted from such liability under the law of
that country” |
To bring
greater clarity, the
amendment passed by the Lok Sabha
seeks to narrow down the scope of the expression “liable to tax”,
as under: ·
Condition of “liable to tax” is now to be seen in relation to a person and with reference to a country, as opposed to liability
of tax of the person in any country; ·
Earlier, liability of tax was to be examined in respect of any law for the time being
in force; amendment by Lok Sabha now restricts the same to income-tax liability under the law of the other country. The amendment nullifies the decision of the Bombay High Court in the case of DIT vs Chiron
Bearing |
