BUDGET 2020 2021 English

KEY TO BUDGET DOCUMENTS
BUDGET 2020-2021
1. The list of Budget documents presented to the Parliament, besides the Finance
Minister’s Budget Speech, is given below:
A. Annual Financial Statement (AFS)
B. Demands for Grants (DG)
C. Finance Bill
D. Statements mandated under FRBM Act:
i. Macro-Economic Framework Statement
ii. Medium-Term Fiscal Policy cum Fiscal Policy Strategy Statement
E. Expenditure Budget
F. Receipt Budget
G. Expenditure Profile
H. Budget at a Glance
I. Memorandum Explaining the Provisions in the Finance Bill
J. Output Outcome Monitoring Framework
K. Key Features of Budget 2020-21
The documents shown at Serial Nos. A, B, and C are mandated by Art. 112,113 and
110 (a) of the Constitution of India respectively, while the documents at Serial No. D (i) and (ii)
are presented as per the provisions of the Fiscal Responsibility and Budget Management Act,
2003. Other documents at Serial Nos. E, F, G, H, I, J and K are in the nature of explanatory
statements supporting the mandated documents with narrative in a user-friendly format suited
for quick or contextual references. The “Output Outcome Monitoring Framework” will have
clearly defined outputs and outcomes for various Central Sector Schemes and Centrally
Sponsored Schemes with measurable indicators against them and specific targets for FY
2020-21. Hindi version of all these documents is also presented to the Parliament. A web
version is hosted at http:// indiabudget.gov.in, with hyperlinks, intended to make more efficient
and user-friendly access to all documents.
2.1 A brief description of the Budget documents listed above is as follows:
A. Annual Financial Statement (AFS)
The Annual Financial Statement (AFS), the document as provided under Article 112, shows
9
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the estimated receipts and expenditure of the Government of India for 2020-21 in relation to
estimates for 2019-20 as also actual expenditure for the year 2018-19. The receipts and
disbursements are shown under three parts in which Government Accounts are kept viz.,
(i) The Consolidated Fund of India, (ii) The Contingency Fund of India and (iii) The Public
Account of India. The Annual Financial Statement distinguishes the expenditure on revenue
account from the expenditure on other accounts, as is mandated in the Constitution of India.
The Revenue and the Capital sections together, make the Union Budget. The estimates of
receipts and expenditure included in the Annual Financial Statement are for expenditure net
of refunds and recoveries.
The significance of the Consolidated Fund, the Contingency Fund and the Public Account
as well as the distinguishing features of the Revenue and the Capital portions are given below
briefly:
(i) The Consolidated Fund of India (CFI) draws its existence from Article 266 of the
Constitution. All revenues received by the Government, loans raised by it, and also
receipts from recoveries of loans granted by it, together form the Consolidated Fund of
India. All expenditure of the Government is incurred from the Consolidated Fund of
India and no amount can be drawn from the Consolidated Fund without due authorization
from the Parliament.
(ii) Article 267 of the Constitution authorises the existence of a Contingency Fund of India
which is an imprest placed at the disposal of the President of India to facilitate meeting
of urgent unforeseen expenditure by the Government pending authorization from the
Parliament. Parliamentary approval for such unforeseen expenditure is obtained, ex-
post-facto, and an equivalent amount is drawn from the Consolidated Fund to recoup
the Contingency Fund after such ex-post-facto approval. The corpus of the Contingency
Fund as authorized by Parliament presently stands at ` 500 crore.
(iii) Moneys held by Government in trust are kept in the Public Account. The Public Account
draws its existence from Article 266 of the Constitution of India. Provident Funds, Small
Savings collections, income of Government set apart for expenditure on specific objects
such as road development, primary education, other Reserve/Special Funds etc., are
examples of moneys kept in the Public Account. Public Account funds that do not
belong to the Government and have to be finally paid back to the persons and authorities
who deposited them, do not require Parliamentary authorisation for withdrawals. The
approval of the Parliament is obtained when amounts are withdrawn from the
Consolidated Fund and kept in the Public Account for expenditure on specific objects.
The actual expenditure on the specific object is again submitted for vote of the Parliament
for withdrawal from the Public Account for incurring expenditure on the specific objects.
The Union Budget can be demarcated into the part pertaining to revenue which is for
ease of reference termed as Revenue Budget in (iv) below and the part pertaining to
Capital which is for ease of reference termed as Capital Budget in (v) below.
(iv) The Revenue Budget consists of the revenue receipts of the Government (Tax revenues
and other Non Tax revenues) and the expenditure met from these revenues. Tax
revenues comprise proceeds of taxes and other duties levied by the Union. The
estimates of revenue receipts shown in the Annual Financial Statement take into account
the effect of various taxation proposals made in the Finance Bill. Other non-tax receipts
11
of the Government mainly consist of interest and dividend on investments made by the
Government, fees and other receipts for services rendered by the Government. Revenue
expenditure is for the normal running of Government departments and for rendering of
various services, making interest payments on debt, meeting subsidies, grants in aid,
etc. Broadly, the expenditure which does not result in creation of assets for the
Government of India, is treated as revenue expenditure. All grants given to the State
Governments/Union Territories and other parties are also treated as revenue expenditure
even though some of the grants may be used for creation of capital assets.
(v) Capital receipts and capital payments together constitute the Capital Budget. The capital
receipts are loans raised by the Government from the public (these are termed as
market loans), borrowings by the Government from the Reserve Bank of India and
other parties through the sale of Treasury Bills, the loans received from foreign
Governments and bodies, disinvestment receipts and recoveries of loans from State
and Union Territory Governments and other parties. Capital payments consist of capital
expenditure on acquisition of assets like land, buildings, machinery, equipment, as
also investments in shares, etc., and loans and advances granted by the Central
Government to the State and the Union Territory Governments, Government companies,
Corporations and other parties.
(vi) Accounting Classification
• The estimates of receipts and disbursements in the Annual Financial Statement
and of expenditure in the Demands for Grants are shown according to the accounting
classification referred to under Article 150 of the Constitution.
• The Annual Financial Statement shows, certain disbursements distinctly, which are
charged on the Consolidated Fund of India. The Constitution of India mandates
that such items of expenditure such as emoluments of the President, salaries and
allowances of the Chairman and the Deputy Chairman of the Rajya Sabha and the
Speaker and the Deputy Speaker of the Lok Sabha, salaries, allowances and
pensions of the Judges of the Supreme Court, the Comptroller and Auditor-General
of India and the Central Vigilance Commission, interest on and repayment of loans
raised by the Government and payments made to satisfy decrees of courts etc.,
may be charged on the Consolidated Fund of India and are not required to be voted
by the Lok Sabha.
B. Demands for Grants
(i) Article 113 of the Constitution mandates that the estimates of expenditure from the
Consolidated Fund of India included in the Annual Financial Statement and required to
be voted by the Lok Sabha, be submitted in the form of Demands for Grants. The
Demands for Grants are presented to the Lok Sabha along with the Annual Financial
Statement. Generally, one Demand for Grant is presented in respect of each Ministry
or Department. However, more than one Demand may be presented for a Ministry or
Department depending on the nature of expenditure. With regard to Union Territories
without Legislature, a separate Demand is presented for each of such Union Territories.
In Budget 2020-21 there are 101 Demands for Grants. Each Demand initially gives
separately the totals of (i)’voted’ and ‘charged’ expenditure; (ii) the ‘revenue’ and the
‘capital’ expenditure and (iii) the grand total on gross basis of the amount of expenditure
12
for which the Demand is presented. This is followed by the estimates of expenditure
under different major heads of account. The amounts of recoveries are also shown.
The net amount of expenditure after reducing the recoveries from the gross amount is
also shown. A summary of Demands for Grants is given at the beginning of this
document, while details of ‘New Service’ or ‘New Instrument of Service’ such as,
formation of a new company, undertaking or a new scheme, etc., if any, are indicated
at the end of the document.
(ii) Each Demand normally includes the total provisions required for a service, that is,
provisions on account of revenue expenditure, capital expenditure, grants to State and
Union Territory Governments and also loans and advances relating to the service.
Where the provision for a service is entirely for expenditure charged on the Consolidated
Fund of India, for example, interest payments (Demand for Grant No. 37), a separate
Appropriation, as distinct from a Demand, is presented for that expenditure and it is
not required to be voted by the Lok Sabha. Where, however, expenditure on a service
includes both ‘voted’ and ‘charged’ items of expenditure, the latter are also included in
the Demand presented for that service but the ‘voted’ and ‘charged’ provisions are
shown separately in that Demand.
C. Finance Bill
At the time of presentation of the Annual Financial Statement before the Parliament, a
Finance Bill is also presented in fulfilment of the requirement of Article 110 (1)(a) of the
Constitution, detailing the imposition, abolition, remission, alteration or regulation of taxes
proposed in the Budget. It also contains other provisions relating to Budget that could be
classified as Money Bill. A Finance Bill is a Money Bill as defined in Article 110 of the Constitution.
D. Statements mandated under FRBM Act.

i. Macro-Economic Framework Statement
The Macro-economic Framework Statement is presented to Parliament under Section 3 of
the Fiscal Responsibility and Budget Management Act, 2003 and the rules made thereunder.
It contains an assessment of the growth prospects of the economy along with the statement of
specific underlying assumptions. It also contains an assessment regarding the GDP growth
rate, the domestic economy and the stability of the external sector of the economy, fiscal
balance of the Central Government and the external sector balance of the economy.
ii. Medium-Term Fiscal Policy cum Fiscal Policy Strategy Statement
The Medium-Term Fiscal Policy Statement cum Fiscal Policy Strategy Statement is
presented to Parliament under Section 3 of the Fiscal Responsibility and Budget Management
Act, 2003. It sets out the three-year rolling targets for six specific fiscal indicators in relation to
GDP at market prices, namely (i) Fiscal Deficit, (ii) Revenue Deficit, (iii) Primary Deficit (iv)
Tax Revenue (v) Non-tax Revenue and (vi) Central Government Debt. The Statement includes
the underlying assumptions, an assessment of the balance between revenue receipts and
revenue expenditure and the use of capital receipts including market borrowings for the creation
of productive assets. It also outlines for the existing financial year, the strategic priorities of
the Government relating to taxation, expenditure, lending and investments, administered pricing,
borrowings and guarantees. The Statement explains how the current fiscal policies are in
13
conformity with sound fiscal management principles and gives the rationale for any major
deviation in key fiscal measures.
2.2 Explanatory Documents:
To facilitate a more comprehensive understanding of the major features of the Budget,
certain other explanatory documents are presented. These are briefly summarized below:
E. Expenditure Budget
The provisions made for a scheme or a programme may be spread over a number of
Major Heads in the Revenue and Capital sections in a Demand for Grants. In the Expenditure
Budget, the estimates made for a scheme/programme are brought together and shown on a
net basis on Revenue and Capital basis at one place. Expenditure of individual Ministries/
Departments are classified under 2 broad Umbrellas (i) Centres’ Expenditures and (ii) Transfers
to States/Union Territories (UTs). Under the Umbrella of Centres’ Expenditure there are 3 sub-
classification (a) Establishment expenditure of the Centre (b) Central Sector Schemes and
(c) Other Central Expenditure including those on Central Public Sector Enterprises(CPSEs)
and Autonomous Bodies.
The Umbrella of Transfers to States/UTs includes the following 3 sub-classification:
(a) Centrally Sponsored Scheme
(b) Finance Commission Transfers
(c) Other Transfer to States
To understand the objectives underlying the expenditure proposed for various schemes
and programmes in the Expenditure Budget, suitable explanatory notes are included in this
volume.
F. Receipt Budget
Estimates of receipts included in the Annual Financial Statement are further analysed in
the document “Receipt Budget”. The document provides details of tax and non-tax revenue
receipts and capital receipts and explains the estimates. The document also provides a
statement on the arrears of tax revenues and non-tax revenues, as mandated under the
Fiscal Responsibility and Budget Management Rules, 2004. Trend of receipts and expenditure
along with deficit indicators, statement pertaining to National Small Savings Fund (NSSF),
Statement of Liabilities, Statement of Guarantees given by the government, statements of
Assets and details of External Assistance are also included in Receipts Budget. This also
includes the Statement of Revenue Impact of Tax Incentives under the Central Tax System
which seeks to list the revenue impact of tax incentives that are proposed by the Central
Government. This document also shows liabilities of the Government on account of securities
(bonds) issued in lieu of oil and fertilizer subsidies in the past. This was earlier called ‘Statement
of Revenue Foregone’ and brought out as a separate statement in 2015-16. This has been
merged in the Receipts Budget from 2016-17 onwards.
G. Expenditure Profile
(i) This document was earlier titled Expenditure Budget - Vol-I. It has been recast in line
with the decision on Plan-Non Plan merger. It gives an aggregation of various types of
expenditure and certain other items across demands.
14
(ii) Under the present accounting and budgetary procedures, certain classes of receipts,
such as payments made by one Department to another and receipts of capital projects
or schemes, are taken in reduction of the expenditure of the receiving Department.
While the estimates of expenditure included in the Demands for Grants are for the
gross amounts, the estimates of expenditure included in the Annual Financial Statement
are for the net expenditure, after taking into account the recoveries. The document,
makes certain other refinements such as netting expenditure of related receipts so
that overstatement of receipts and expenditure figures is avoided. The document
contains statements indicating major variations between BE 2019-20 and RE 2019-20
as well as between RE 2019-20 and BE 2020-21 with brief reasons. Contributions to
International bodies and estimated strength of establishment of various Government
Departments and provision thereof are shown in separate Statements. A statement
each, showing (i) Gender Budgeting (ii) Schemes for Development of Scheduled Castes
and Scheduled Tribes including Scheduled Caste Sub Scheme (SCSS) and Tribal
Sub Scheme (TSS) allocations and (iii) Schemes for the Welfare of Children are also
included in this document. It also has statements on (i) the expenditure details and
budget estimates regarding Autonomous Bodies and (ii) the details of certain important
funds in the Public Account.
(iii) Scheme Expenditure
Scheme expenditure forms a sizeable proportion of the total expenditure of the
Central Government. The Demands for Grants of the various Ministries show the
Scheme expenditure under the two categories of Centrally Sponsored Schemes and
Central Sector Schemes separately. The Expenditure Profile also gives the total
provisions for each of the Ministries arranged under the various categories- Centrally
Sponsored Schemes, Central Sector Schemes, Establishment, Other Central
Expenditure, Transfer to States etc. and highlights the budget provisions for certain
important programmes and schemes. Statements showing externally aided projects
are also included in the document.
(iv) Public Sector Enterprises
A detailed report on the working of public sector enterprises is given in the document
titled ‘Public Enterprises Survey’ brought out separately by the Department of Public
Enterprises. A report on the working of the enterprises under the control of various
administrative Ministries is also given in the Annual Reports of the various Ministries
circulated to the Members of Parliament separately. The annual reports along with the
audited accounts of each of the Government companies are also separately laid before
the Parliament. Besides, the reports of the Comptroller and Auditor General of India on
the working of various Public Sector Enterprises, are also laid before Parliament.
(v) Commercial Departments
Railways is the principal departmentally-run commercial undertaking of Government.
The Budget of the Ministry of Railways and the Demands for Grants relating to Railway
expenditure are presented to the Parliament together with the Union Budget from the
financial year 2017-18 onwards. The Expenditure Profile has a separate section on
Railways to capture all the salient aspects of the demand for grants of Railways and
15
other details of interest regarding Railways. The total receipts and expenditure of the
Railways are, incorporated in the Annual Financial Statement of the Government of
India. Details of other commercially run departmental undertakings are also shown in
a statement. Expenditure is depicted in the Expenditure Profile and Expenditure Budget,
net of receipts of the Departmental Commercial Undertakings, in order to avoid
overstatement of both receipts and expenditure.
(vi) The receipts and expenditure of the Ministry of Defence Demands shown in the Annual
Financial Statement, are explained in greater detail in the document Defence Services
Estimates presented with the Detailed Demands for Grants of the Ministry of Defence.
(vii) The details of grants given to bodies other than State and Union Territory Governments
are given in the statements of Grants-in-aid paid to non-Government bodies appended
to Detailed Demands for Grants of the various Ministries.
H. Budget at a Glance
(i) This document shows in brief, receipts and disbursements along with broad details of
tax revenues and other receipts. This document provides details of resources transferred
by the Central Government to State and Union Territory Governments. This document
also shows the revenue deficit, the gross primary deficit and the gross fiscal deficit of
the Central Government. The excess of Government’s revenue expenditure over
revenue receipts constitutes revenue deficit of Government. The difference between
the total expenditure of Government by way of revenue, capital and loans net of
repayments on the one hand and revenue receipts of Government and capital receipts
which are not in the nature of borrowing but which accrue to Government on the other,
constitutes gross fiscal deficit. Gross primary deficit is gross fiscal deficit reduced by
the gross interest payments. In the Budget documents ‘gross fiscal deficit’ and ‘gross
primary deficit’ have been referred to in abbreviated form ‘fiscal deficit’ and ‘primary
deficit’, respectively.
(ii) The document also includes a statement indicating the quantum and nature (share in
Central Taxes, grants/loan) of the total Resources transferred to States and Union
Territory Governments. Details of these transfers by way of share of taxes, grants-in-
aid and loans are given in Expenditure Profile (Statement No.18). Bulk of grants and
loans to States are disbursed by the Ministry of Finance and are included in the Demand
‘Transfers to States’ and in the Demand ‘Transfer to Delhi’ and Transfer to Puducherry’.
The grants and loans released to States and Union Territories by other Ministries/
Departments are reflected in their respective Demands.
The Budget of the Central Government is not merely a statement of receipts and
expenditure. Since Independence, it has become a significant statement of government
policy. The Budget reflects and shapes, and is, in turn, shaped by the country’s economy.
For a better appreciation of the impact of government receipts and expenditure on the
other sectors of the economy, it is necessary to group them in terms of certain economic
magnitudes, for example, how much is set aside for capital formation, how much is
spent directly by the Government and how much is transferred by Government to
other sectors of the economy by way of grants, loans, etc. This analysis is contained in
the Economic and Functional Classification of the Central Government Budget which
is brought out by the Ministry of Finance separately.
16
I. Memorandum Explaining the Provisions in the Finance Bill

To facilitate understanding of the taxation proposals contained in the finance Bill, the
provisions and their implications are explained in the document titled Memorandum Explaining
the Provisions in the Finance Bill.
J. Output Outcome Monitoring Framework
Outcome Budget with Output-Outcome Monitoring Framework (OOMF) for Central Sector
Schemes (CSs) and Centrally Sponsored Schemes (CSSs) with financial outlay of ` 500 crore
and more each, will be laid in the House along with Budget 2020-2021. With regard to CS
and CSS schemes with outlay less than ` 500 crore each, the output-outcome monitoring
framework with itemized expenditure of the schemes will be prepared by the respective Ministry/
Department and the same will be presented in the Parliament along with the Detailed Demand
for Grants (DDG).
K. Key Features of Budget 2020-21
The Document is a snapshot summary of the economic vision of the Government and the
major policy initiatives in the thrust areas of the economy for growth and welfare. Major
milestones achieved in fiscal consolidation and management of the Government finances
along with a bird’s eye view of the key budget proposals for the fiscal year 2020-2021 are also
included in the document.
Prominent Themes of the Budget
Governance
Ease of Financial
sector
Living
Aspirational
sp a o a Economic
co o c
Caring Society
India Development
Agriculture, Irrig Industry, Comm Women &

ation and Rural erce and Child, Social
Development Investment Welfare
Wellness, Water Culture and

Infrastructure
and Sanitation Tourism
Education and Environment and

New Economy
Skills Climate Change
GOVERNANCE
STRUCTURAL REFORMS
IBC GST
• Honourable • 20 per cent reduction in turn around time for trucks.
exit through • Benefit to MSMEs through enhanced threshold and
IBC for composition
p limits.
companies. • Savings of about 4 per cent of monthly spending
for an average household.
• In last 2 years, 60 lakh new taxpayers added and
105 crore e-way bills generated
1
DIGITAL REVOLUTION
Shift to DBT Next wave
• During 2018- • Digital Governance.
19, `7 lakh crore • Improve physical quality of life through
t
transferred
f d N ti
Nationall Infrastructure
I f t t Pipeline
Pi li
through DBT. • Disaster Resilience.
• Social Security through Pension and
Insurance penetration.
INCLUSIVE GROWTH
• Governance guided by “Sabka Saath, Sabka Vikas, Sabka
Vishwas” with focus on:
• Preventive Healthcare: Provision of sanitation and water
• Healthcare: Ayushman Bharat
• Clean energy: Ujjawala and Solar Power
• Financial Inclusion,
Inclusion Credit support and Pension
• Affordable Hosuing
• Digital penetration
FINANCIAL SECTOR
• Deposit Insurance Coverage to increase from `1 lakh to `5

Lakh per depositor.
• Eligibility limit for NBFCs for debt recovery under SARFAESI
Act proposed to be reduced to asset size of `100 crore or
loan size of `50 Lakh.
• Proposal to sell balance holding of government in IDBI Bank
Bank.
• Separation of NPS Trust for government employees from
PFRDAI.
• Specified categories of government securities would be opened

for non resident investors
• FPI Limit for corporate bonds to be increased to 15 per cent.
• New debt ETF proposed mainly for government securities.
2
Macroeconomic Indicators
GDP Growth Rate (per cent) CPI and WPI (per cent)
8.5
8 6
7.5
7 4
6.5
6 2
5.5
5 0
4.5
4-15
5-16
6-17
7-18
April-
2018-19
4
er)
-2
Decembe
2014
2015
2016
2017
2019-20(A
-4
CPI-C WPI
9,000
Net FDI CAD/Forex (per cent)
8,000
7,000 35
6,000 30
US $ Million
25
5,000
20
4,000
15
3,000
10
2,000
5
1,000
0
0
Oct-17
Oct-18
Oct-19
Apr-17
Apr-18
Apr-19
Jan-17
Jul-17
Jan-18
Jul-18
Jan-19
Jul-19
-1,000
53 3.5
Trends in Deficits Debt
ent)
nt)
52 3
External Debt (per cen
Central Government Debt (per ce
4.1 4.2 51 2.5

1.1 50
3.9 4.0 2
3.8 49
Percent of GDP
Percent of GDP
0.9 1.5
3.8 48
0.7 0.9 3.5 3.5 3.5 47 1
3.4 3.6
46 0.5
0.5 0.7 0.7 3.4
45 0
0.3 3.2
0 4 0.4
0.4 0 4 0.4
04 0.4
0.1 3.0
Central Government Debt as per cent of GDP
External Debt as per cent of GDP at current

PD FD (RHS) exchange rate
3
Tracking Progress in Numbers
Foreign Exchange Reserves (` crore) Gross Bank Credit (` Crore)
3320000 10000000
3270000 9000000
3220000 8000000
3170000 7000000
3120000 6000000
3070000 5000000
3020000 4000000
2970000 3000000
02-Aug-2019
16-Aug-2019
30-Aug-2019
13-Sep-2019
27-Sep-2019
11--Oct-2019
25--Oct-2019
08-Nov-2019
22-Nov-2019
06-Dec-2019
20-Dec-2019
03--Jan-2020
17--Jan-2020
2000000
1000000
0
Nov.24,Mar.
201730,Nov.23,
2018 Mar.29,
2018 Nov.22,
2019 2019
National Infrastructure Pipeline

Distribution of workers by status in
Employment (per cent) Rural Infrastructure
2011-12 2017-18 Irrigation

Renewable Power
60
Conventional Power
50
40 Railways
30 Urban and Housing
20
Roads
10
0 0 5 10 15 20
Self employed Regular wage/ Casual labour
Salaried Rs. Lakh Crores
India is the 5th largest economy in the world in terms of GDP at current US $ Trillion.
USA CHINA
GERMANY 3.9
21.4
14.1 5.2
JAPAN
2.9
INDIA
All figures in US $
Trillion
4
Budget at a glance
Revenue Expenditure
p ((in ` Capital
p Expenditure
p ( ` crore))
(in
crore)
4,20,000
28,00,000
3,50,000
24,00,000
20,00,000 2,80,000
16,00,000 2,10,000
12,00,000
1,40,000
8,00,000
70,000
4,00,000
0 0
Revenue Receipts (in ` crore) Capital Receipts (in Rs.

Capital Receipts (in Rs
crore)
21,00,000
12,00,000
14,00,000 10,00,000
8 00 000
8,00,000
6,00,000
7,00,000
4,00,000
2,00,000
0 0
5
Budget at a Glance
Non Debt Capital
Rupee Comes From Receipts
6%
Borrowings and
Other Liabilities
20%
Income Tax
17%
Non Tax Revenue

Union Excise 10%
Duties
7%
Customs
4%
Corporation Tax
18%
GST
18%
Centrally
Rupee Goes To Sponsored
Pensions Schemes
6% 9%
Other
Expenditure Subsidies
10% 6%
Defence
8%
Central Sector
Schemes
13%
Interest
Payments
Finance 18%
Commission and
Other Transfers
10%
States' Share of
Taxes and Duties
20%
6
Tax proposals
Concessional corporate tax rate of 15 per cent to new domestic
companies in manufacturing and power sector.
Tax concession for sovereign wealth fund of foreign governments
and other foreign investments.
Tax benefits to Start-ups by way of deduction of 100 per cent of
their profits are enhanced by increasing turnover limit and
period of eligibility.
eligibility
Concessional tax rate for cooperatives proposed.
Turnover threshold for audit of MSMEs increased.
Extension of time limits pertaining to the tax benefits for
affordable housing.
Issuance of Unique Registration Number to all charity institutions
f easy tax
for t compliance.
li
Health cess to be imposed on imports of medical equipment
given these are made significantly in India.
Dividend Distribution Tax removed and classical system

of dividend taxation adopted.
Simplified and New Income Tax Regime as an option to

the old regime
regime.
Income
Bracket (`
lakh) Below 5 5-7.5 7.5-10 10-12.5 12.5-15 Above 15
Tax Rate (per
cent) Exempt 10 15 20 25 30
Simplified GST return shall be implemented from 1st April

2020. Refund process to be fully automated.
7
Agriculture, Irrigation and Rural Development
PM KUSUM to cover 20 lakh farmers for stand alone solar

pumps and
d ffurther
th 15 llakh
kh ffor grid
id connected
t d pumps.
• Viability gap funding for creation of

efficient warehouses on PPP
mode.
• SHG run Vill
SHGs Village storage
t scheme
h
to be launched.
• Integartion of e-NWR with e-NAM.
“Kisan Rail” and “Krishi Udaan” to be • Fish Production

l
launched
h dbby IIndian
di R Railways
il andd target of 200
Ministry of Civil Aviation respectively lakh tonnes by
for a seamless national cold supply 2022-23.
chain for perishables. • Another 45000
acres of aqua
• Elimination
Eli i ti off FMD and dbbrucellosis
ll i culture to be
in cattle and PPR in sheep and supported.
goat by 2025. • Fishery
• Increasing coverage of artificial extention
insemination to 70 per cent. through 3477
• Doubling of milk processing Sagar Mitras
capacity by 2025. and 500 fish
• Agricultural credit target of `15 FPOs.
lakh crore for 2020-21. • Raise fishery
exports to `1
lakh crore by
2024-25.
8
Wellness, Water and Sanitation
• More than 20
20,000
000 empanelled hospitals under
PM Jan Arogya Yojana.
• FIT India movement launched to fight NCDs.
Coverage • “TB Harega Desh Jeetega” campaign

under
Nikshay launched to end TB by 2025
2025.
Poshan
Yojana (`
Lakh) • Viability gap funding proposed for
35 setting up hospitals in the PPP
mode.
• Expansion of Jan Aushadhi Kendra
Scheme to all districts by 2024.
• ODF Plus to sustain ODF behaviour.

• Focus on liquid and grey water
management along with waste
management.
80
70 SBM ((` crore))
60
12294
50
40 9638
30
20
10
0
NFHS-3 NFHS-4
IMR U5MR 2019-20 (RE) 2020-21 (BE)
9
Education and Skills
• About 150 higher educational institutions will start
apprenticeship embedded courses.
• I t
Internship
hi opportunities
t iti tto fresh
f h engineers
i b urban
by b local
l l
bodies.
• Special bridge courses to improve skill sets of those seeking
employment abroad.
Allocation 2020-21 (BE) Study in

Study in EQUIP (` crore)
(` crore)
India (crore) 1413
DHRUV 65
Operation Digital
Board
32
0 10 20 30
• Degree level online

2019‐20 2020‐21 2020-21 (BE)
education (RE) (BE)
programmes for
students of deprived
sections of the Programme for Apprenticeship
society. Training (` crore)
• Ind-SAT to be
conducted in Asia 2020-21 (BE)
and Africa under
2019-20 (RE)
Study in India
programme. 166 168 170 172 174 176
New Economy
• Knowledge Translation Clusters for emerging technology sectors
• Scaling up of Technology Clusters harbouring test beds and small
scale manufacturing facilities.
• National Mission on Quantum Technologies and applications with an
outlay of Rs.8000 crore proposed.
10
Industry, Commerce and Investment
• Scheme to encourage manufacturing of mobile
phones, electronic equipment and semi conductor
packaging.
packaging
• National Technical Textiles Mission for a period of 4
years.
• NIRVIK Scheme for higher export credit disbursement

launched.
• S tti up off an Investment
Setting I t t Clearance
Cl Cell
C ll to
t provide
id
end to end facilitation.
• Extension of invoice financing to MSMEs through TReDs.

• A scheme to provide subordinate debt for entrepreneurs of
MSMEs
MSMEs.
• Scheme anchored by EXIM Bank and SIDBI to handhold MSMEs
in exports markets.
CORPORATE TAX RATE CUT
Thailand 20
India 22
Japan 23.2
Bangladesh 25
Indonesia 25
China 25
Sri Lanka 28
Philippines 30
0 10 20 30
11
Infrastructure
• National Logistics Policy to be launched soon
soon.
• Roads: Accelerated development of Highways.
• Railways: Four station redevelopment projects
• 150 passenger trains through PPP mode.
• More Tejas type trains for tourist destinations.
• Port: Corporatizing
p g at least one major
j p port.
• Air: 100 more airports to be developed under
UDAAN.
• Power: Efforts to replace conventional energy

meters by prepaid smart meters.
• Gas Grid: Expand National Gas Grid to 27,000 km
• Infrastructure Financing: `103 lakh crore National

infrastructure Pipeline projects announced.
• An international bullion exchange to be set up at GIFT
City.
Bharat Net (` crore) Accelerated road development

9000
8000
7000
6000
5000
4000
3000
2000
1000
0 4000 8000
0
2019-20 (RE) 2020-21 (BE) in km
12
Caring Society
Women & Culture and Tourism Environment
child, social • Proposal to establish and Climate
Welfare Indian Institute of Change
• More than 6 Heritage and • Coalition for
lakh conservation. Disaster
anganwadi • 5 archaeological Resilient
workers sites to be developed Infrastructure
equipped as iconic sites. launched in
with smart • A museum on September
phones. Numismatics and 2019.
• A task force Trade to be • Encouragem
to be established ent to states
appointed to • Tribal museum in implementing
recommend Ranchi . plans for
regarding • Maritime museum to cleaner air in
lowering be set up at Lothal. cities above 1
MMR and million.
improving
nutrition
levels.
Tourism promotion
(` crore)
2500
Nutrition related programmes

(` crore)
35600
2020-21 (BE)
2020-21 (BE)
13
Budget Allocation to Major Schemes
PM KISAN Pradhan Mantri Swasthya

Suraksha Yojana
In ` Crore
80000
70000
7000
60000
6000
50000 5000
40000 4000
30000 3000
2000
20000
1000
10000 0
0 2019-20 RE 2020-21 BE
2019-20 RE 2020-21 BE
ICDS
DBT LPG 29000
28000
27000
2020-21 BE
26000
2019-20 RE 25000
24000
0 10000 20000 30000 40000
23000
2019-20 2020-21
RE BE
Pradhan Mantri
Awas Yojana
28000
27500 Pradhan Mantri Gram
27000
26500
Sadak Yojana
26000
25500
5500 2020-21 BE
25000
24500 2019-20 RE
24000
0 5000 10000 15000 20000
2019-20 RE 2020-21 BE
15
Expenditure of major items
In ` Crore
Rs. 50040 Ministry of Housing and Urban Affairs
Rs. 67112 Ministry of Health and Family Welfare
Rs. 72216 Ministry of Railways
Ministry of Road Transport

Rs. 91823
and Highways
Rs. 99312 Ministry of Human Resource

Development
Rs. 122398 Ministry off Rural Development
Ministry of Consumer
Rs. 124535
Affairs, Food and Public
Distribution
Rs. 142762 Ministry of Agriculture and Farmers’

Welfare
Rs. 167250 Ministry of Home Affairs
Rs. 471378 Ministry of Defence
14
¤ÉVÉ] BÉEÉ ºÉÉ®
BUDGET AT A GLANCE
2020-2021
¤ÉVÉ] BÉäE ºÉÉ® àÉå ¤ÉVÉ] +ÉxÉÖàÉÉxÉÉå BÉEÉä ºlÉÚãÉ ºÉàÉÚcÉå àÉå ¤ÉÉÆ] BÉE® Budget at a Glance presents broad aggregates of
{ÉÉÊ®ãÉÉÊFÉiÉ ÉÊBÉEªÉÉ VÉÉiÉÉ cè iÉÉÉÊBÉE ¤ÉVÉ] BÉEÉä +ÉÉºÉÉxÉÉÒ ºÉä ºÉàÉZÉÉ VÉÉ the Budget in a reader-friendly document. This
ºÉBÉäE* ªÉc nºiÉÉ´ÉäVÉ £ÉÉ®iÉ ºÉ®BÉEÉ® BÉEÉÒ |ÉÉÉÎ{iÉªÉÉå A´ÉÆ ´ªÉªÉ BÉäE ºÉÉlÉ- document shows receipts and expenditure as well as
ºÉÉlÉ ®ÉVÉBÉEÉäKÉÉÒªÉ PÉÉ]ä, ®ÉVÉº´É PÉÉ]ä, |É£ÉÉ´ÉÉÒ ®ÉVÉº´É PÉÉ]ä A´ÉÆ |ÉÉlÉÉÊàÉBÉE the Fiscal Deficit (FD), Revenue Deficit (RD), Effective
PÉÉ]ä BÉEÉä n¶ÉÉÇiÉÉ cè* <ºÉBÉäE +ÉÉÊiÉÉÊ®BÉDiÉ, <ºÉ nºiÉÉ´ÉäVÉ àÉå ={ÉªÉÖBÉDiÉ Revenue Deficit (ERD), and the Primary Deficit (PD).
SÉÉ]Éç +ÉÉè® OÉÉ{ÉEÉå BÉäE àÉÉvªÉàÉ ºÉä |ÉÉÉÎ{iÉªÉÉå BÉäE »ÉÉäiÉÉå, =xÉBÉäE +ÉxÉÖ|ÉªÉÉäMÉÉå, of the Government of India. Besides, it presents a
jÉ@hÉ BÉäE ¤ªÉÉè®Éå iÉlÉÉ PÉÉ]ä BÉäE ºÉÆºÉÚSÉBÉEÉå, PÉÉ]É ÉÊ´ÉkÉ{ÉÉäKÉhÉ BÉäE »ÉÉäiÉÉå pictorial account of sources of receipts, their application,
iÉlÉÉ ¤ÉVÉ] BÉEÉä |É£ÉÉÉÊ´ÉiÉ BÉE®xÉä ´ÉÉãÉä àÉci´É{ÉÚhÉÇ ºÉÆPÉ]BÉEÉå BÉEÉ ÉÊSÉjÉÉiàÉBÉE the details of debt and deficit indicators, sources of
¤ªÉÉè®É |ÉºiÉÖiÉ ÉÊBÉEªÉÉ VÉÉiÉÉ cè* deficit financing and trends and composition of important
budgetary variables through charts and graphs.
2. ®ÉVÉBÉEÉäKÉÉÒªÉ PÉÉ]É ®ÉVÉº´É |ÉÉÉÎ{iÉªÉÉå VÉàÉÉ jÉ@hÉ-ÉÊ£ÉxxÉ {ÉÚÆVÉÉÒ 2. Fiscal Deficit is the difference between the
|ÉÉÉÎ{iÉªÉÉå iÉlÉÉ BÉÖEãÉ BªÉªÉ BÉEä ¤ÉÉÒSÉ BÉEÉ +ÉÆiÉ® cè* ªÉc ºÉ®BÉEÉ® BÉEÉÒ Revenue Receipts plus Non-debt Capital Receipts
BÉÖEãÉ =vÉÉ® ºÉÆ¤ÉÆvÉÉÒ +ÉÉ´É¶ªÉBÉEiÉÉ+ÉÉäÆ BÉEÉä n¶ÉÉÇiÉÉ cè* ®ÉVÉº´É PÉÉ]ä (NDCR) and the total expenditure. FD is reflective of
BÉEÉ +ÉlÉÇ ®ÉVÉº´É |ÉÉÉÎ{iÉªÉÉå BÉEÉÒ iÉÖãÉxÉÉ àÉå ®ÉVÉº´É ´ªÉªÉ +ÉÉÊvÉBÉE cÉäxÉÉ the total borrowing requirements of Government.
cè* |É£ÉÉ´ÉÉÒ ®ÉVÉº´É PÉÉ]É ®ÉVÉº´É PÉÉ]ä iÉlÉÉ {ÉÚÆVÉÉÒMÉiÉ +ÉÉÉÎºiÉªÉÉå BÉäE Revenue Deficit refers to the excess of revenue
ºÉßVÉxÉ BÉäE ÉÊãÉA +ÉxÉÖnÉxÉÉå BÉäE ¤ÉÉÒSÉ BÉEÉ +ÉxiÉ® cè* |ÉÉlÉÉÊàÉBÉE PÉÉ]ä expenditure over revenue receipts. Effective Revenue
BÉEÉä ¤ªÉÉVÉ +ÉnÉªÉÉÊMÉªÉÉÆ PÉ]ÉBÉE® ®ÉVÉBÉEÉäKÉÉÒªÉ PÉÉ]ä uÉ®É àÉÉ{ÉÉ VÉÉiÉÉ Deficit is the difference between Revenue Deficit and
cè* Grants for Creation of Capital Assets. Primary Deficit
is measured as Fiscal Deficit less interest payments.
3. ¤ÉVÉ] 2020-21 BÉßEÉÊÉ, ºÉÉàÉÉÉÊVÉBÉE FÉäjÉ, ÉÊ¶ÉFÉÉ +ÉÉè® º´ÉÉºlªÉ àÉå 3. Budget 2020-21 reflects the Government’s firm
ÉÊxÉ´Éä¶É BÉEÉä àÉci´É{ÉÚhÉÇ °ô{É ºÉä ¤É¸ÉxÉä BÉEÉÒ ºÉ®BÉEÉ® BÉEÉÒ o¸ |ÉÉÊiÉ¤ÉriÉÉ commitment to substantially boost investment in
n¶ÉÉÇiÉÉ cè* ªÉc ®ÉVÉBÉEÉäÉÉÒªÉ PÉÉ]ä BÉEÉä ºÉ.PÉ.=. BÉäE 3.8± {É® ®JÉiÉä Agriculture, Social Sector, Education and Health. This
cÖA ºÉÆ.+É (2019-20) BÉEÉÒ iÉÖãÉxÉÉ àÉå ´ªÉªÉ àÉå `3,43,678 BÉE®Éä½ is substantiated by increase in expenditure of ` 3,43,678
¤É¸ÉäiÉ®ÉÒ BÉE®BÉäE ÉÊºÉr ÉÊBÉEªÉÉ VÉÉiÉÉ cè* crores over RE (2019-20) while keeping the fiscal deficit
at 3.8% of GDP.
4. ºÉÆ.+É. 2019-20 àÉå BÉÖEãÉ ´ªÉªÉ ` 26,98,552 BÉE®Éä½ ®JÉÉ MÉªÉÉ 4. In RE 2019-20, the total expenditure has been kept
cè, VÉÉä +ÉxÉÆÉÊiÉàÉ ´ÉÉºiÉÉÊ´ÉBÉE (2018-19) ºÉä ` 3,83,439 BÉE®Éä½ at ` 26,98,552 crore and is more than Provisional Actual
+ÉÉÊvÉBÉE cè* (2018-19) by `3,83,439 crore.

5. ®ÉVªÉÉå BÉEÉä VÉÉxÉä ´ÉÉãÉä BÉÖEãÉ ºÉÆºÉÉvÉxÉ, ÉÊVÉxÉàÉå BÉE®Éå àÉå ®ÉVªÉ BÉäE 5. The total resources going to States including the
ÉÊcººÉä BÉEÉ +ÉÆiÉ®hÉ, +ÉxÉÖnÉxÉ/jÉ@hÉ +ÉÉè® BÉäÆEpÉÒªÉ |ÉÉªÉÉäÉÊVÉiÉ ªÉÉäVÉxÉÉ+ÉÉå devolution of State’s share in taxes, Grants/Loans, and
BÉäE iÉciÉ VÉÉ®ÉÒ ÉÊ xÉÉÊvÉªÉÉÆ ¶ÉÉÉÊàÉãÉ cé, ¤É.+É. (2020-21) àÉå releases under Centrally Sponsored Schemes in BE
`13,90,666 BÉE®Éä½ cè, VÉÉä ºÉÆ.+É. (2019-20) BÉEÉÒ iÉÖãÉxÉÉ àÉå (2020-21) is `13,90,666 crore, with an increase of
` 2,02,705 BÉE®Éä½ +ÉÉÊvÉBÉE cè* `2,02,705 crore over RE (2019-20).
6. ´ÉÉÇ 2018-19 BÉäE ÉÊãÉA ´ÉÉºiÉÉÊ´ÉBÉE +ÉxÉÆÉÊiÉàÉ cé* 6. Actuals for 2018-19 are provisional.
(ii)
¤ÉVÉ] BÉEÉ ºÉÉ® Budget at a Glance
(` BÉE®Éä½) (In ` crore)
2018-2019 2019-2020 2019-2020 2020-2021
´ÉÉºiÉÉÊ´ÉBÉE ¤ÉVÉ] ºÉÆ¶ÉÉäÉÊvÉiÉ ¤ÉVÉ]
+ÉxÉÖàÉÉxÉ +ÉxÉÖàÉÉxÉ +ÉxÉÖàÉÉxÉ
Actuals Budget Revised Budget
Estimates Estimates Estimates
1. ®ÉVÉº´É |ÉÉÉÎ{iÉªÉÉÆ 1. Revenue Receipts 1552916 1962761 1850101 2020926
2. BÉE® ®ÉVÉº´É 2. Tax Revenue
(BÉäÆEp BÉEÉä ÉÊxÉ´ÉãÉ ) (Net to Centre) 1317211 1649582 1504587 1635909
3. BÉE®-ÉÊ£ÉxxÉ ®ÉVÉº´É 3. Non Tax Revenue 235705 313179 345514 385017
4. {ÉÚÆVÉÉÒ |ÉÉÉÎ{iÉªÉÉÆ¹ 4. Capital Receipts 762197 823588 848451 1021304

5. jÉ@hÉÉå BÉEÉÒ ´ÉºÉÚãÉÉÒ 5. Recovery of Loans 18052 14828 16605 14967
6. +ÉxªÉ |ÉÉÉÎ{iÉªÉÉÆ 6. Other Receipts 94727 105000 65000 210000
7. =vÉÉ® +ÉÉè® +ÉxªÉ 7. Borrowings and Other
näªÉiÉÉAÆ ² Liabilities 1 649418 703760 766846 796337
8. BÉÖEãÉ |ÉÉÉÎ{iÉªÉÉÆ (1¨4) 8. Total Receipts (1+4) 2315113 2786349 2698552 3042230
9. BÉÖEãÉ ´ªÉªÉ (10¨13) 9. Total Expenditure (10+13) 2315113 2786349 2698552 3042230
10. ®ÉVÉº´É JÉÉiÉä {É® 10. On Revenue Account 2007399 2447780 2349645 2630145
ÉÊVÉºÉàÉå ºÉä of which
11. ¤ªÉÉVÉ £ÉÖMÉiÉÉxÉ 11. Interest Payments 582648 660471 625105 708203
12. {ÉÚÆVÉÉÒ {ÉÉÊ®ºÉÆ{ÉÉÊkÉªÉÉå BÉäE ºÉßVÉxÉ 12. Grants in Aid for creation 191781 207333 191737 206500
cäiÉÖ ºÉcÉªÉiÉÉ +ÉxÉÖnÉxÉ of capital assests
13. {ÉÚÆVÉÉÒ JÉÉiÉä {É® 13. On Capital Account 307714 338569 348907 412085
14. ®ÉVÉº´É PÉÉ]É (10-1) 14. Revenue Deficit (10-1) 454483 485019 499544 609219
(2.4) (2.3) (2.4) (2.7)
15. |É£ÉÉ´ÉÉÒ ®ÉVÉº´É PÉÉ]É 15. Effective Revenue Deficit 262702 277686 307807 402719
(14-12) (14-12) (1.4) (1.3) (1.5) (1.8)
16. ®ÉVÉBÉEÉäÉÉÒªÉ PÉÉ]É 16. Fiscal Deficit 649418 703760 766846 796337
[9-(1¨5¨6)] [9-(1+5+6)] (3.4) (3.3) (3.8) (3.5)
17. |ÉÉlÉÉÊàÉBÉE PÉÉ]É (16-11) 17. Primary Deficit (16-11) 66770 43289 141741 88134
(0.4) (0.2) (0.7) (0.4)
1
<ºÉàÉå xÉBÉEnÉÒ ¶ÉäÉ àÉå +ÉÉc®hÉ uÉ®É BÉEàÉÉÒ ¶ÉÉÉÊàÉãÉ cè*
ÉÊ]{{ÉhÉÉÒ :
(?) 2019-2020 BÉäE ºÉÆ¶ÉÉäÉÊvÉiÉ +ÉxÉÖàÉÉxÉ àÉå `20442233 BÉE®Éä½ BÉäE +ÉxÉÖàÉÉÉÊxÉiÉ ºÉPÉ= BÉEÉÒ iÉÖãÉxÉÉ àÉå 10.0± BÉEÉÒ ´ÉßÉÊr n® àÉÉxÉiÉä cÖA 2020-2021 BÉäE ¤ÉVÉ]
+ÉxÉÖàÉÉxÉ àÉå ºÉPÉ= ¤É¸BÉE® `22489420 BÉE®Éä½ cÉäxÉä BÉEÉ {ÉÚ´ÉÉÇxÉÖàÉÉxÉ cè
(??) <ºÉ nºiÉÉ´ÉäVÉ BÉEÉÒ {ÉßlÉBÉE -{ÉßlÉBÉE àÉnå {ÉÚhÉÉÈBÉExÉ BÉäE BÉEÉ®hÉ ºÉÆ£É´ÉiÉ& VÉÉä½ ºÉä àÉäãÉ xÉ JÉÉAÆ
(???) BÉEÉä~BÉE àÉå ÉÊnªÉå MÉA +ÉÉÆBÉE½ä ºÉPÉ= BÉäE |ÉÉÊiÉ¶ÉiÉ BÉäE °ô{É àÉå cè
1
Includes drawdown of cash Balance
Notes:
(i) GDP for BE 2020-2021 has been projected at `22489420 crore assuming 10.0 % growth over the estimated
GDP of `20442233 crore for 2019-2020 (RE).
(ii) Individual items in this document may not sum up to the totals due to rounding off
(iii) Figures in parenthesis are as a percentage of GDP
2
âó{ÉªÉÉ BÉEcÉÆ ºÉä +ÉÉiÉÉ cè Rupee Comes From

(¤ÉVÉ] Budget 2020-21)
20 {Éè. p.
3 {Éè. p.
9 {Éè. p.
21 {Éè. p.
19 {Éè. p.
16 {Éè. p.
8 {Éè. p. 4 {Éè. p.
=vÉÉ® +ÉÉè® +ÉxªÉ näªÉiÉÉAÆ

Borrowings & Other Liabilities
jÉ@hÉ -ÉÊ£ÉxxÉ {ÉÚÆVÉÉÒ |ÉÉÉÎ{iÉªÉÉÆ 20 {Éè. p.
Non-Debt Capital Receipts
6 {Éè. p.
BÉE®-ÉÊ£ÉxxÉ ®ÉVÉº´É
Non-Tax Revenue ÉÊxÉMÉàÉ-BÉE®
10 {Éè. p. Corporation-Tax
18 {Éè. p.
àÉÉãÉ +ÉÉè® ºÉä´ÉÉ BÉE®

Goods and Service Tax
18 {Éè. p.
+ÉÉªÉ BÉE®
Income-Tax
17 {Éè. p
BÉäExpÉÒªÉ =i{ÉÉn-¶ÉÖãBÉE ºÉÉÒàÉÉ-¶ÉÖãBÉE
Union Excise Duties Customs
7 {Éè. p. 4 {Éè. p.
ÉÊ]{{ÉÉÊhÉªÉÉÆ:-1. BÉÖEãÉ |ÉÉÉÎ{iÉªÉÉå àÉå BÉE®Éå +ÉÉè® ¶ÉÖãBÉEÉå àÉå ®ÉVªÉÉå BÉEÉ ÉÊcººÉÉ ¶ÉÉÉÊàÉãÉ cè, ÉÊVÉxcå {ÉßK~ 1 {É® ºÉÉ®hÉÉÒ àÉå PÉ]É
ÉÊnªÉÉ MÉªÉÉ cè
2. +ÉÉÆBÉE½Éå BÉEÉä {ÉÚhÉÉÈÉÊBÉEiÉ ÉÊBÉEªÉÉ MÉªÉÉ cè*
Notes:-1. Total receipts are inclusive of States' share of taxes and duties which have been
netted in the table on page1.
2. Figures have been rounded.
3
âó{ÉªÉÉ BÉEcÉÆ VÉÉiÉÉ cè Rupee Goes To

9 {Éè. p.
8 {Éè. p.
5 {Éè. p. 13 {Éè. p.
23 {Éè. p. 18 {Éè. p.
9 {Éè. p.
8 {Éè. p.
7 {Éè. p.
BÉäExpÉÒªÉ |ÉÉªÉÉäÉÊVÉiÉ ªÉÉäVÉxÉÉAÆ

Centrally Sponsored Scheme
+ÉxªÉ BªÉªÉ 9 {Éè. p. BÉEäxpÉÒªÉ FÉäjÉ BÉEÉÒ
Other Expenditure ªÉÉäVÉxÉÉ
10 {Éè. p. Central Sector
Scheme
{Éå¶ÉxÉ
Pensions 13 {Éè. p.
6 {Éè. p.
¤ªÉÉVÉ +ÉnÉªÉMÉÉÒ
Interest
Payments
18 {Éè. p.
BÉE®Éå +ÉÉè® ¶ÉÖãBÉEÉå àÉå
®ÉVªÉÉå BÉEÉ ÉÊcººÉÉ
States' share of
taxes & duties
20 {Éè. p.
®FÉÉ
Defence
8 {Éè. p.
ÉÊ´ÉkÉ +ÉÉªÉÉäMÉ +ÉÉè® +ÉxªÉ +ÉÉÉÌlÉBÉE ºÉcÉªÉiÉÉ
+ÉÆiÉ®hÉ Subsidies
Finance Commission 6 {Éè. p.
& Other Transfers
10 {Éè. p.
ÉÊ]{{ÉhÉÉÒ :-BÉÖEãÉ BªÉªÉ àÉå BÉE®Éå +ÉÉè® ¶ÉÖãBÉEÉå àÉå ®ÉVªÉÉå BÉEÉ ÉÊcººÉÉ ¶ÉÉÉÊàÉãÉ cè, ÉÊVÉxcå {ÉßK~ 1 {É® ºÉÉ®hÉÉÒ àÉå |ÉÉÉÎ{iÉªÉÉå àÉå ºÉä PÉ]É ÉÊnªÉÉ
MÉªÉÉ cè*
Note:- Total expenditure is inclusive of the States' share of taxes and duties which have been
netted against receipts in the table on page 1.
4
PÉÉ]ä BÉEÉ ºÉÉ® Deficit Statistics

2018-2019 2019-2020 2019-2020 2020-2021
1. ®ÉVÉBÉEÉäKÉÉÒªÉ PÉÉ]É 1. Fiscal Deficit 649418 703760 766846 796337
(3.4) (3.3) (3.8) (3.5)
2. ®ÉVÉº´É PÉÉ]É 2. Revenue Deficit 454483 485019 499544 609219

(2.4) (2.3) (2.4) (2.7)
3. |É£ÉÉ´ÉÉÒ ®ÉVÉº´É PÉÉ]É 3. Effective Revenue Deficit 262702 277686 307807 402719
(1.4) (1.3) (1.5) (1.8)
4. |ÉÉlÉÉÊàÉBÉE PÉÉ]É 4. Primary Deficit 66770 43289 141741 88134

(0.4) (0.2) (0.7) (0.4)
®ÉVÉBÉEÉäKÉÉÒªÉ PÉÉ]É ÉÊ´ÉkÉ{ÉÉäKÉhÉ BÉäE »ÉÉäiÉ Sources of Financing Fiscal Deficit

2018-2019 2019-2020 2019-2020 2020-2021

1. jÉ@hÉ |ÉÉÉÎ{iÉªÉÉÆ (ÉÊxÉ´ÉãÉ) 1. Debt Receipts (Net)
2. ¤ÉÉVÉÉ® =vÉÉ® 2. Market Borrowings

(ºÉ®BÉEÉ®ÉÒ |ÉÉÊiÉ£ÉÚÉÊiÉ¨ (G-sec +T Bills+POLIF) 430164 448122 498972 535870
®ÉVÉBÉEÉäKÉÉÒªÉ cÖÆbÉÒ¨
{ÉÉÒ+ÉÉäAãÉ+ÉÉ<ÇA{ÉE)
3. +Éã{É ¤ÉSÉiÉÉå BÉäE ¤ÉnãÉä 3. Securities against Small

|ÉÉÊiÉ£ÉÚÉÊiÉªÉÉÆ Savings 125000 130000 240000 240000
4. ®ÉVªÉ £ÉÉÊ´ÉKªÉ ÉÊxÉÉÊvÉªÉÉÆ 4. State Provident Funds 16059 18000 18000 18000
5. +ÉxªÉ |ÉÉÉÎ{iÉªÉÉÆ (+ÉÉÆiÉÉÊ®BÉE 5. Other Receipts (Internal

jÉ@hÉ iÉlÉÉ ãÉÉäBÉE ãÉäJÉÉ) Debts and Public Account) 73997 59532 4941 50848
6. ÉÊ´Énä¶ÉÉÒ jÉ@hÉ 6. External Debt 5519 (-)2952 4933 4622
7. xÉBÉEnÉÒ ¶ÉäÉ BÉEÉ BÉEàÉ +ÉÉc®hÉ 7. Draw Down of Cash Balance (-) 1321 51059 ... (-) 53003
8. BÉÖEãÉ VÉÉä½ 8. Grand Total 649418 703760 766846 796337

5
PÉÉ]ä BÉEÉÒ |É´ÉßÉÊkÉªÉÉÆ

DEFICIT TRENDS (% of GDP)
6.6
7
6.1
5.9
6
5.3
4.9 4.9
4.6
5 4.5
4.5
4.1
3.9 3.8
4 3.7 3.5
3.5 3.5 3.4
3.2 3.3 3.2
2.6 3.0 2.9
3 2.6 2.7
2.5 2.5 2.4 2.4
2.8 2.1
1.8 1.9 1.9 1.8
2 1.5 1.5 1.5
1.4
1.1
1.8 0.9 1.0
1 0.7 0.7
0.4 0.4 0.4 0.4
0
2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 RE 19-20 BE 20-21
Fiscal Deficit Revenue Deficit Effective Revenue Deficit Primary Deficit
PÉÉ]É ÉÊ´ÉkÉ{ÉÉäKÉhÉ BÉäE »ÉÉäiÉ

SOURCES OF DEFICIT FINANCING
(` in crore)
Securities against small savings State Provident Fund

Other Receipts (Internal Debt and Public Account External Debt
Draw Down of Cash Balance Market Borrowings
300000 600000
SOURCES OF FINANCING FD (EXCLUDING MARKET
250000
500000
200000
MARKET BORROWINGS
400000
150000
BORROWINGS)
100000 300000
50000
200000
0
2016-17 2017-18 2018-19 RE19-20 BE20-21
100000
-50000
-100000 0
6
|ÉÉÉÎ{iÉªÉÉÆ Receipts
2018-19 2019-2020 2019-2020 2020-21
®ÉVÉº´É |ÉÉÉÎ{iÉªÉÉÆ REVENUE RECEIPTS
1. BÉE® ®ÉVÉº´É 1. Tax Revenue
ºÉBÉEãÉ BÉE®-®ÉVÉº´É Gross Tax Revenue 2080465 2461195 2163423 2423020
BÉE. ÉÊxÉMÉàÉ BÉE® a. Corporation Tax 663572 766000 610500 681000
JÉ. +ÉÉªÉ {É® BÉE® b. Taxes on Income 473003 569000 559500 638000
MÉ. vÉxÉ BÉE® c. Wealth Tax 41 .. .. ..
PÉ. ºÉÉÒàÉÉ ¶ÉÖãBÉE d. Customs 117813 155904 125000 138000
b. BÉäExpÉÒªÉ =i{ÉÉn ¶ÉÖãBÉE e. Union Excise Duties 231982 300000 248012 267000
SÉ. ºÉä´ÉÉ BÉE® f. Service Tax 6904 .. 1200 1020
U. VÉÉÒAºÉ]ÉÒ g. GST 581560 663343 612327 690500
- BÉäÆEpÉÒªÉ VÉÉÒAºÉ]ÉÒ - CGST 457534 526000 514000 580000
- +ÉÉ<VÉÉÒAºÉ]ÉÒ - IGST 28945 28000 .... ....
- VÉÉÒAºÉ]ÉÒ FÉÉÊiÉ{ÉÚÉiÊ ÉÇ ={ÉBÉE® - GST Compensation Cess 95081 109343 98327 110500
VÉ. ºÉÆPÉ ®ÉVªÉ FÉäjÉÉå {É® BÉE® h. Taxes of Union Territories 5592 6948 6884 7500
PÉ]É<A -®ÉK]ÅÉÒªÉ +ÉÉ{ÉnÉ Less - NCCD transferred to
+ÉÉBÉEÉÎºàÉBÉEiÉÉ ÉÊxÉÉÊvÉ/®ÉK]ÅÉÒªÉ the NCCF/NDRF 1800 2480 2790 2930
+ÉÉ{ÉnÉ +ÉxÉÖÉÊ#ÉEªÉÉ ÉÊxÉÉÊvÉ BÉEÉä
+ÉÆiÉÉÊ®iÉ AxÉºÉÉÒºÉÉÒbÉÒ
PÉ]É<A-®ÉVªÉÉå BÉEÉ ÉÊcººÉÉ Less - State’s share 761454 809133 656046 784181
1BÉE BÉäÆEp BÉEÉ ÉÊxÉ´ÉãÉ BÉE® 1a Centre’s Net Tax
®ÉVÉº´É Revenue 1317211 1649582 1504587 1635909
2. BÉE®-ÉÊ£ÉxxÉ ®ÉVÉº´É 2. Non-Tax Revenue 235704 313179 345513 385017
¤ªÉÉVÉ |ÉÉÉÎ{iÉªÉÉÆ Interest receipts 12145 13711 11027 11042
ãÉÉ£ÉÉÆ¶É +ÉÉè® ãÉÉ£É Dividends and Profits 113420 163528 199893 155395
ÉÊ´Énä¶ÉÉÒ +ÉxÉÖnÉxÉ External Grants 1063 1006 974 812
+ÉxªÉ BÉE®-ÉÊ£ÉxxÉ ®ÉVÉº´É Other Non Tax Revenue 107187 132784 131525 215465
ºÉÆPÉ ®ÉVªÉ FÉäjÉÉå BÉEÉÒ Receipts of Union
|ÉÉÉÎ{iÉªÉÉÆ Territories 1889 2149 2094 2303
BÉÖEãÉ ®ÉVÉº´É |ÉÉÉÎ{iÉªÉÉÆ (1BÉE¨2) Total- Revenue Receipts (1a + 2) 1552916 1962761 1850101 2020926
3. {ÉÚÆVÉÉÒ |ÉÉÉÎ{iÉªÉÉÆ 3. CAPITAL RECEIPTS

BÉE. jÉ@hÉ-ÉÊ£ÉxxÉ |ÉÉÉÎ{iÉªÉÉÆ A. Non-debt Receipts 112779 119828 81605 224967
(?) jÉ@hÉÉå +ÉÉè® +ÉÉÊOÉàÉÉå BÉEÉÒ (i) Recoveries of loans and
´ÉºÉÚÉÊãÉªÉÉÆ@ advances@ 18052 14828 16605 14967
(??) ÉÊ´ÉÉÊxÉ´Éä¶É |ÉÉÉÎ{iÉªÉÉÆ (ii) Disinvestment Receipts 94727 105000 65000 210000
JÉ. jÉ@hÉ |ÉÉÉÎ{iÉªÉÉÆ * B. Debt Receipts* 650739 652702 766846 849340
VÉÉä½ {ÉÚÆVÉÉÒMÉiÉ |ÉÉÉÎ{iÉªÉÉÆ (BÉE¨JÉ) Total Capital Receipts (A+B) 763518 772529 848450 1074306
4. xÉBÉEnÉÒ ¶ÉäKÉ BÉEÉ BÉEàÉ 4. Draw-Down of Cash

+ÉÉc®hÉ Balance -1321 51059 .... -53003
VÉÉä½ |ÉÉÉÎ{iÉªÉÉÆ (1BÉE¨2¨3) Total Receipts (1a+2+3) 2316434 2735290 2698552 3095233
AàÉAºÉAºÉ BÉäE iÉciÉ |ÉÉÉÎ{iÉªÉÉÆ Receipts under
(ÉÊxÉ´ÉãÉ) MSS (Net) .. .. .. ..
* |ÉÉÉÎ{iÉªÉÉÆ £ÉÖMÉiÉÉxÉ PÉ]ÉBÉE® cé*
@ <ºÉàÉå +Éã{ÉÉ´ÉÉÊvÉBÉE jÉ@hÉ A´ÉÆ +ÉÉÊOÉàÉ BÉEÉÒ ´ÉºÉÚãÉÉÒ ¶ÉÉÉÊàÉãÉ xÉcÉÓ cè*
* The receipts are net of payment.
@ Excludes recoveries of short term loans and advances.
7
BÉE® |ÉÉÉÎ{iÉªÉÉå àÉå âóZÉÉxÉ

TREND IN TAX RECEIPTS (% of GDP)
12 11.2
10.9 10.8
10.4 10.6
10.2 10.1 10.0 11.2
10
10.6
5.9 6.0 5.9

5.6 5.6 5.6 5.5 5.6 5.7
6 5.4
5.6
5.2 5.3
4.9 4.9 4.9
4 4.5 4.8
4.4 4.4
0
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 RE 19-20 BE 20-21
Gross Tax Receipt Direct Tax Indirect Tax
Note : GDP is as per the latest estimates published by CSO.

VÉÉÒbÉÒ{ÉÉÒ, BÉäExpÉÒªÉ ºÉÉÆÉÎJªÉBÉEÉÒ BÉEÉªÉÉÇãÉªÉ uÉ®É |ÉBÉEÉÉÊ¶ÉiÉ xÉ´ÉÉÒxÉiÉàÉ +ÉxÉÖàÉÉxÉÉå BÉäE +ÉxÉÖºÉÉ® cè*
BÉäÆEp BÉEÉÒ ÉÊxÉ´ÉãÉ |ÉÉÉÎ{iÉªÉÉÆ

NET RECEIPT OF THE CENTRE (` in lakh crore)
25
2.25
20 0.82
1.13 3.85
1.16 3.46
0.65
15
2.36
0.63 1.93
0.51 2.73
0.42
0.37 0.41 1.98 2.51
10
1.99
1.37 16.36
1.22 15.1
12.4 13.2
5 11.0
9.0 9.4
7.4 8.2
6.3
0
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 RE 19-20 BE 20-21
Net-Centre’s Tax Revenue Non Tax Revenue Non Debt Capital Receipt
8
£ÉÉ®iÉ ºÉ®BÉEÉ® BÉEÉ ´ªÉªÉ Expenditure of Government of India

2018-2019 2019-2020 2019-2020 2020-2021
BÉE. BÉäÆEp BÉEÉ ´ªÉªÉ A. Centre’s Expenditure

I ºlÉÉ{ÉxÉÉ ´ªÉªÉ I Establishment Expenditure 521247 546296 567133 609585
II BÉäÆEpÉÒªÉ FÉäjÉ BÉEÉÒ ªÉÉäVÉxÉÉAÆ/ II Central Sector Schemes/
{ÉÉÊ®ªÉÉäVÉxÉÉAÆ Projects 638495 870794 773196 831825
III BÉäÆEpÉÒªÉ FÉäjÉ BÉEÉ III Other Central Sector
+ÉxªÉ ´ªÉªÉ Expenditure
ÉÊVÉºÉàÉå ºÉä of which 677403 772129 741553 887574
¤ªÉÉVÉ £ÉÖMÉiÉÉxÉ Interest Payments 582648 660471 625105 708203
JÉ. +ÉÆiÉ®hÉ B. Transfers

IV BÉäÆEpÉÒªÉ |ÉÉªÉÉäÉÊVÉiÉ ªÉÉäVÉxÉÉAÆ IV Centrally Sponsored Schemes 296029 331610 316816 339894
V ÉÊ´ÉkÉ +ÉÉªÉÉäMÉ BÉäE +ÉxÉÖnÉxÉ V Finance Commission Grants 93704 120466 123710 149925
VI +ÉxªÉ +ÉxÉÖnÉxÉ/jÉ@hÉ/+ÉÆiÉ®hÉ VI Other Grants/Loans/Transfers 88235 145054 176144 223427
BÉÖEãÉ VÉÉä½ Grand Total 2315113 2786349 2698552 3042230
ºÉ®BÉEÉ® BÉEÉ {ÉÚÆVÉÉÒMÉiÉ ´ªÉªÉ Capital Expenditure of the Government

2018-2019 2019-2020 2019-2020 2020-2021

ºÉBÉEãÉ ¤ÉVÉ]ÉÒªÉ ºÉcÉªÉiÉÉ Gross Budgetary Support 307714 338570 348907 412085
®äãÉ àÉÆjÉÉãÉªÉ (+ÉÉ<Ç<Ç¤ÉÉÒ+ÉÉ®) Ministry of Railways (IEBR) 80539 94071 88247 90792
+ÉÉ<Ç<Ç¤ÉÉÒ+ÉÉ®# (®äãÉ àÉÆjÉÉãÉªÉ BÉEÉä IEBR (excluding Ministry of
UÉä½BÉE®) Railways) 527417 443568 622318 581871
VÉÉä½ Total 915670 876209 1059472 1084748
9
´ªÉªÉ BÉEÉÒ ºÉÆ®SÉxÉÉ

COMPOSITION OF EXPENDITURE
(` in lakh crore)
35
30
2.23 Other Grants/Loans
1.76 1.50
25 3.40 Finance Commission Grants
0.88 1.24
0.81 0.94 3.17 Centrally sponsored scheme
0.55
20 0.92 2.96
0.96 2.85 8.88 Other Central Sector
2.41 7.42 Expenditure
15 6.77 Central Sector Schemes
6.23
5.70
8.32 Establishment Expenditure of
10 7.73
6.38 Centre
5.89 5.88
5
4.73 5.21 5.67 6.10
4.24
0
2016-17 2017-18 2018-19 RE 19-20 BE 20-21
{ÉÚÆVÉÉÒMÉiÉ ´ªÉªÉ BÉEÉÒ |É´ÉßÉÊkÉ

TREND OF CAPITAL EXPENDITURE
(` in crore)
1200000
1000000
800000
IEBR (excluding Ministry of

600000 Railways)
400000
Ministry of Railways (IEBR)
200000
Gross Budgetory Support
0
2015-16 2016-17 2017-18 2018-19 RE 19-20 BE 20-21
10
|ÉàÉÖJÉ àÉnÉå BÉEÉ ´ªÉªÉ Expenditure of Major Items

2018-2019 2019-2020 2019-2020 2020-2021
{Éå¶ÉxÉ Pension 160211 174300 184147 210682

®FÉÉ Defence 290802 305296 316296 323053
ºÉÉÎ¤ºÉbÉÒ - Subsidy -
- =´ÉÇ®BÉE Fertiliser 70605 79996 79998 71309
- JÉÉtÉ Food 101327 184220 108688 115570
- {Éä]ÅÉäÉÊãÉªÉàÉ Petroleum 24837 37478 38569 40915
BÉßEÉÊKÉ +ÉÉè® ºÉÆ¤Ér BÉEÉªÉÇBÉEãÉÉ{É Agriculture and Allied Activities 63259 151518 120835 154775
´ÉÉÉÊhÉVªÉ +ÉÉè® =tÉÉäMÉ Commerce and Industry 27851 27043 28608 27227
{ÉÚ´ÉÉäÇkÉ® BÉEÉ ÉÊ´ÉBÉEÉºÉ Development of North East 1961 3000 2670 3049
ÉÊ¶ÉFÉÉ Education 80345 94854 94854 99312
>óVÉÉÇ Energy 45461 44638 42458 42725
ÉÊ´Énä¶É External Affairs 15514 17885 17372 17347
ÉÊ´ÉkÉ Finance 14920 20121 24880 41829
º´ÉÉºlªÉ Health 54477 64999 63830 67484
MÉßc Home Affairs 98116 103927 124083 114387
¤ªÉÉVÉ Interest 582648 660471 625105 708203
+ÉÉ<Ç]ÉÒ +ÉÉè® nÚ®ºÉÆSÉÉ® IT and Telecom 14868 21783 16000 59349
+ÉxªÉ Others 74497 76665 76782 84256
ªÉÉäVÉxÉÉ +ÉÉè® ºÉÉÆÉÎJªÉBÉEÉÒ Planning and Statistics 5322 5814 5811 6094
OÉÉàÉÉÒhÉ ÉÊ´ÉBÉEÉºÉ Rural Development 132803 140762 143409 144817
´ÉèYÉÉÉÊxÉBÉE ÉÊ´É£ÉÉMÉ Scientific Departments 24755 27431 27694 30023
ºÉÉàÉÉÉÊVÉBÉE BÉEãªÉÉhÉ Social Welfare 43664 50850 48210 53876
BÉE® |É¶ÉÉºÉxÉ Tax Administration 69416 117285 137307 152962
ÉÊVÉºÉàÉå ºÉä VÉÉÒAºÉ]ÉÒ of which Transfer to
FÉÉÊiÉ{ÉÚÉÊiÉÇ ÉÊxÉÉÊvÉ BÉEÉä +ÉÆiÉ®hÉ GST Compensation Fund 54275 101200 121200 135368
®ÉVªÉÉå BÉEÉ +ÉÆiÉ®hÉ Transfer to States 119144 155447 155447 200447
{ÉÉÊ®´ÉcxÉ Transport 143626 157437 158207 169637
ºÉÆPÉ ®ÉVªÉ FÉäjÉ Union Territories 14073 15098 15026 52864
¶Éc®ÉÒ ÉÊ´ÉBÉEÉºÉ Urban Development 40612 48032 42267 50040
BÉÖEãÉ VÉÉä½ Grand Total 2315113 2786349 2698552 3042230
11
´ªÉªÉ BÉEÉÒ ºÉÆ®SÉxÉÉ

COMPOSITION OF EXPENDITURE
´ªÉªÉ BÉEÉÒ |ÉàÉÖJÉ àÉnÉå BÉEÉÒ |É´ÉßÉÊkÉ

TREND OF MAJOR ITEMS OF EXPENDITURE
154775
158207
169637
180000
144817
143626
143409
132803
160000
120835
140000
99312
120000
94854
80345
100000
67484
63830
63259
80000
54477
53876
50040
48210
43664
42267
40612
60000
40000
20000
0
Agriculture and Education Health Rural Social Welfare Transport Urban
Allied Activities Development Development
2018-19 RE 19-20 BE 2020-21

12
®ÉVªÉÉå +ÉÉè® ÉÊ´ÉvÉÉxÉ àÉÆbãÉ ´ÉÉãÉä ºÉÆPÉ ®ÉVªÉ FÉäjÉÉå BÉEÉä ºÉÆºÉÉvÉxÉÉå BÉEÉ +ÉÆiÉ®hÉ
TRANSFER OF RESOURCES TO STATES AND UNION
TERRITORIES WITH LEGISLATURE
2018-2019 2019-2020 2020-2021
´ÉÉºiÉÉÊ´ÉBÉE ºÉÆ¶ÉÉäÉÊvÉiÉ ¤ÉVÉ]
+ÉxÉÖàÉÉxÉ +ÉxÉÖàÉÉxÉ
Actuals Revised Budget
Estimates Estimates
I. BÉE®Éå àÉå ®ÉVªÉÉå BÉäE ÉÊcººÉä BÉEÉ +ÉÆi É®hÉ I. Devolution of States share
in taxes 761454 656046 784181
II. +ÉÆiÉ®hÉ BÉEÉÒ BÉÖEU àÉci´É{ÉÚhÉÇ àÉnå II. Some Important Items of Transfer 46236 57344 73275
1. AxÉbÉÒ+ÉÉ®A{ÉE ºÉä ®ÉVªÉÉå BÉEÉä ºÉcÉªÉiÉÉ 1. Assistance to States from NDRF 10000 20000 25000
2. {ÉÚ´ÉÉäÇkÉ® FÉäjÉ +ÉÉè® ÉÊºÉÉÎB ÉDBÉEàÉ BÉäE ÉÊãÉA 2. Central Pool of Resources for North
BÉäÆEpÉÒªÉ {ÉÚãÉ ºÉÆºÉÉvÉxÉ Eastern Region and Sikkim 450 380 407
3. ¤ÉÉÁÉ ºÉcÉªÉiÉÉ ´ÉÉãÉÉÒ {ÉÉÊ®ªÉÉäVÉxÉÉAÆ- 3. Externally Added Projects -
+ÉxÉÖnÉxÉ Grants 2824 3000 4000
4. ¤ÉÉÁÉ ºÉcÉªÉiÉÉ ´ÉÉãÉÉÒ {ÉÉÊ®ªÉÉäVÉxÉÉAÆ- 4. Externally Aided Projects-
jÉ@hÉ Loan 23774 25000 25000
5. {ÉÚ´ÉÉäÇkÉ® {ÉÉÊ®KÉn BÉEÉÒ ªÉÉäVÉxÉÉAÆ 5. Schemes of North East Council 445 324 287
6. ºÉÆÉÊ´ÉvÉÉxÉ BÉäE +ÉxÉÖSUän 275(1) BÉäE 6. Schemes under Provision to Article
|ÉÉ´ÉvÉÉxÉ BÉäE iÉciÉ ªÉÉäVÉxÉÉAÆ 275(1) of the Constitution 1815 2321 1199
7. àÉÉÆMÉ BÉäE iÉciÉ ÉÊ´É¶ÉäKÉ ºÉcÉªÉiÉÉ - 7. Special Assistance under the
®ÉVªÉÉå BÉEÉä +ÉÆiÉ®hÉ demand - Transfers to States 4686 4000 15000
8. àÉÉÆMÉ BÉäE iÉciÉ +ÉxÉÖºÉÚÉÊSÉiÉ VÉÉÉÊiÉªÉÉå 8. Special Central Assistance to
BÉEÉä ÉÊ´É¶ÉäKÉ BÉäÆEpÉÒªÉ ºÉcÉªÉiÉÉ - Scheduled Castes under Demand-
ºÉÉàÉÉÉÊVÉBÉE xªÉÉªÉ A´ÉÆ +ÉÉÊvÉBÉEÉÉÊ®iÉÉ Department of Social Justice and
ÉÊ´É£ÉÉMÉ Empowerment 897 1074 1172
9. àÉÉÆMÉ BÉäE iÉciÉ VÉxÉVÉÉÉÊiÉ FÉäjÉ BÉEÉä 9. Special Central Assistnace to Tribal
ÉÊ´É¶ÉäKÉ BÉäÆEpÉÒªÉ ºÉcÉªÉiÉÉ - VÉxÉVÉÉiÉÉÒªÉ Area under the Demand - Ministry
BÉEÉªÉÇ àÉÆjÉÉãÉªÉ of Tribal Affairs 1345 1245 1210
III. ÉÊ´ÉkÉ +ÉÉªÉÉäMÉ BÉäE +ÉxÉÖnÉxÉ III. Finance Commission Grants 93704 123710 149925
1. ºlÉÉxÉÉÒªÉ ÉÊxÉBÉEÉªÉÉå BÉäE ÉÊãÉA +ÉxÉÖnÉxÉ- 1. Grant for local bodies -
OÉÉàÉÉÒhÉ ÉÊxÉBÉEÉªÉ Rural Bodies 35064 58616 69925
2. ºlÉÉxÉÉÒªÉ ¶Éc®ÉÒ ÉÊxÉBÉEÉªÉÉå BÉäE ÉÊãÉA 2. Grants for Urban Local
+ÉxÉÖnÉxÉ Bodies 14400 25843 30000
3. AºÉbÉÒ+ÉÉ®A{ÉE BÉäE ÉÊãÉA ºÉcÉªÉiÉÉ 3. Grants-in-Aid for
+ÉxÉÖnÉxÉ SDRF 9658 10938 20000
4. +ÉÆiÉ®hÉ BÉäE {É¶SÉÉiÉÂ ®ÉVÉº´É PÉÉ]É 4. Post Devolution Revenue
+ÉxÉÖnÉxÉ Deficit Grants 34582 28314 30000
IV. ®ÉVªÉÉå BÉEÉä BÉÖEãÉ +ÉÆi É®hÉ IV. Total Transfer to States
[(I)+(II)+(III) BÉäE <iÉ®] [Other than (I)+(II)+(III)] 286046 322443 335878
1. BÉäExp uÉ®É |ÉÉªÉÉäÉÊVÉiÉ ºBÉEÉÒàÉÉå BÉäE 1. Under Centrally Sponsored
+ÉÆiÉMÉÇiÉ (®ÉVÉº´É) Schemes (Revenue) 271478 283057 295269
2. BÉäExpÉÒªÉ FÉäjÉ BÉEÉÒ ºBÉEÉÒàÉÉå BÉäE +ÉÆiÉMÉÇiÉ 2. Under Central Sector Schemes
(®ÉVÉº´É) (Revenue) 13629 38227 39451
3. ´ªÉªÉ BÉEÉÒ +ÉxªÉ gÉäÉÊhÉªÉÉå BÉäE +ÉÆiÉMÉÇiÉ 3. Under Other Categories of
(®ÉVÉº´É) Expenditure (Revenue) 884 1055 1066
4. {ÉÚÆVÉÉÒ +ÉÆiÉ®hÉ 4. Capital Transfers 55 104 93
V. ÉÊnããÉÉÒ +ÉÉè® {ÉÖbÖSÉä®ÉÒ BÉEÉä BÉÖEãÉ +ÉÆiÉ®hÉ V. Total Transfer to Delhi and Puducherry 7955 28419 47408
1. BÉäExp uÉ®É |ÉÉªÉÉäÉÊVÉiÉ ºBÉEÉÒàÉÉå BÉäE 1. Under Centrally Sponsored
+ÉÆiÉMÉÇiÉ (®ÉVÉº´É) Schemes (Revenue) 793 1999 5603
2. BÉäExp FÉäjÉ BÉEÉÒ ºBÉEÉÒàÉÉå BÉäE +ÉÆiÉMÉÇiÉ 2. Under Central Sector Schemes
(®ÉVÉº´É) (Revenue) 1 222 299
3. ´ªÉªÉ BÉEÉÒ +ÉxªÉ gÉäÉÊhÉªÉÉå BÉäE +ÉÆiÉMÉÇiÉ 3. Under Other Categories of
(®ÉVÉº´É) Expenditure (Revenue) 7031 25972 41355
4. {ÉÚÆVÉÉÒ +ÉÆiÉ®hÉ 4. Capital Transfers 130 225 150
®ÉVªÉÉå/ºÉÆPÉ ®ÉVªÉ FÉäjÉÉå BÉEÉä BÉÖEãÉ +ÉÆiÉ®hÉ Total Transfer to States/UTs 1195394 1187961 1390666
13
®ÉVªÉÉå +ÉÉè® ºÉÆPÉ ®ÉVªÉ FÉäjÉÉå BÉEÉä BÉÖEãÉ +ÉÆiÉ®hÉ

TOTAL TRANSFERS TO STATES AND UTs
(` in lakh crore)
16
13.91
14
11.88
11.95
12
10.85
9.86
10
0
2016-17 2017-18 2018-19 RE 2019-20 BE 2020-21
®ÉVªÉÉå +ÉÉè® ºÉÆPÉ ®ÉVªÉ FÉäjÉÉå BÉEÉä +ÉÆiÉ®hÉ BÉEÉÒ ºÉÆ®SÉxÉÉ

COMPOSITION OF TRANSFERS TO STATES & UTs
(` in crore)
900000
761454 784181
800000
656046
700000
600000
456560
500000
408205
400000 340236
300000
149925
200000
123710
93704
100000
0
Devolution Scheme related and Other Transfers Finance Commission Grants
2018-19 RE 2019-20 BE 2020-21

(` ãÉÉJÉ BÉE®Éä½ àÉå)

(In ` lakh crore)
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|ÉàÉÖJÉ ªÉÉäVÉxÉÉ+ÉÉå {É® {ÉÉÊ®´ªÉªÉ Outlay on Major Schemes

2018-2019 2019-2020 2019-2020 2020-2021
(BÉE) +ÉÉÊiÉ àÉci´É{ÉÚhÉÇ ºBÉEÉÒàÉå (A) Core of the Core Schemes

1 ®É]ÅÉÒªÉ ºÉÉàÉÉÉÊVÉBÉE ºÉcÉªÉiÉÉ 1 National Social Assistance
BÉEÉªÉÇ#ÉEàÉ Progam 8418 9200 9200 9197
2 àÉcÉiàÉÉ MÉÉÆvÉÉÒ ®É]ÅÉÒªÉ OÉÉàÉÉÒhÉ 2 Mahatma Gandhi National Rural
®ÉäVÉMÉÉ® MÉÉ®Æ]ÉÒ BÉEÉªÉÇ#ÉEàÉ Employment Guarantee Program 61815 60000 71002 61500
3 +ÉxÉÖºÉÚÉÊSÉiÉ VÉÉÉÊiÉ BÉäE ÉÊ´ÉBÉEÉºÉ BÉäE 3 Umbrella Scheme for Development
ÉÊãÉA +Éà¥ÉäãÉÉ ªÉÉäVÉxÉÉ of Schedule Castes 7574 5445 5568 6242
4 +ÉxÉÖºÉÚÉÊSÉiÉ VÉxÉVÉÉÉÊiÉªÉÉå BÉäE 4 Umbrella Programme for
ÉÊ´ÉBÉEÉºÉ BÉäE ÉÊãÉA +ÉÆ¥ÉäãÉÉ Development of Scheduled
BÉEÉªÉÇ#ÉEàÉ Tribes 3781 3810 4194 4191
5 +Éã{ÉºÉÆJªÉBÉE ÉÊ´ÉBÉEÉºÉ +Éà¥ÉèãÉÉ 5 Umbrella Programme for
BÉEÉªÉÇ#ÉEàÉ Development of Minorities 886 1590 1709 1820
6 +ÉxªÉ BÉEàÉVÉÉä® ´ÉMÉÉç BÉäE ÉÊ´ÉBÉEÉºÉ 6 Umbrella Programme for
cäiÉÖ +Éà¥ÉäãÉÉ BÉEÉªÉÇ#ÉEàÉ Development of Other Vulnerable Groups 1564 1818 1846 2210
(JÉ) àÉci´É{ÉÚhÉÇ ºBÉEÉÒàÉå (B) Core Schemes
7 cÉÊ®iÉ #ÉEÉÆÉÊiÉ 7 Green Revolution 11758 12561 9965 13320
8 ¶´ÉäiÉ #ÉEÉÆÉÊiÉ 8 W hite Revolution 2422 2240 1799 1805
9 xÉÉÒãÉÉÒ #ÉEÉÆÉÊiÉ 9 Blue Revolution 485 560 455 570
10 |ÉvÉÉxÉàÉÆjÉÉÒ BÉßEÉÊÉ ÉÊºÉÆSÉÉ<Ç ªÉÉäVÉxÉÉ 10 Pradhan Mantri Krishi Sinchai Yojna 8143 9682 7896 11127
11 |ÉvÉÉxÉàÉÆjÉÉÒ OÉÉàÉ ºÉ½BÉE ªÉÉäVÉxÉÉ 11 Pradhan Mantri Gram Sadak Yojna 15414 19000 14070 19500
12 |ÉvÉÉxÉàÉÆjÉÉÒ +ÉÉ´ÉÉºÉ ªÉÉäVÉxÉÉ 12 Pradhan Mantri Awas Yojna
({ÉÉÒAàÉA´ÉÉ<Ç) (PMAY) 25443 25853 25328 27500
13 VÉãÉ VÉÉÒ´ÉxÉ ÉÊàÉ¶ÉxÉ (VÉäVÉäAàÉ) 13 Jal Jeevan Mission (JJM) 5484 10001 10001 11500
14 º´ÉSU £ÉÉ®iÉ ÉÊàÉ¶ÉxÉ (¶Éc®ÉÒ) 14 Swachh Bharat Mission (Urban) 2462 2650 1300 2300
15 º´ÉSU £ÉÉ®iÉ ÉÊàÉ¶ÉxÉ (OÉÉàÉÉÒhÉ) 15 Swachh Bharat Mission (Gramin) 12913 9994 8338 9994
16 ®É]ÅÉÒªÉ º´ÉÉºlªÉ ÉÊàÉ¶ÉxÉ 16 National Health Mission 31502 33651 34290 34115
17 ®É]ÅÉÒªÉ ÉÊ¶ÉFÉÉ ÉÊàÉ¶ÉxÉ 17 National Education Mission 30830 38547 37672 39161
18 ®É]ÅÉÒªÉ ºBÉÚEãÉ àÉvªÉÉÿxÉ £ÉÉäVÉxÉ 18 National Programme of Mid Day
BÉEÉªÉÇ#ÉEàÉ Meal in Schools 9514 11000 9912 11000
19 +Éà¥ÉäãÉÉ +ÉÉ<Ç. ºÉÉÒ. bÉÒ. AºÉ. 19 Umbrella ICDS 21642 27584 24955 28557
20 àÉÉÊcãÉÉ+ÉÉå BÉEÉ ºÉÆ®FÉhÉ +ÉÉè® 20 Mission for Protection and
ºÉ¶ÉkÉEÉÒBÉE®hÉ ÉÊàÉ¶ÉxÉ Empowerment for Women 1138 1330 961 1163
21 ®É]ÅÉÒªÉ +ÉÉVÉÉÒÉÊ´ÉBÉEÉ ÉÊàÉ¶ÉxÉ- 21 National Livelihood Mission -
+ÉÉVÉÉÒÉÊ´ÉBÉEÉ Ajeevika 6282 9774 9774 10005
22 BÉEÉªÉÇ A´ÉÆ BÉEÉè¶ÉãÉ ÉÊ´ÉBÉEÉºÉ 22 Jobs and Skill Development 6126 7260 5749 5372
23 {ÉªÉÉÇ´É®hÉ, ´ÉÉÉÊxÉBÉEÉÒ +ÉÉè® ´ÉxªÉ 23 Environment, Forestry and
VÉÉÒ´É W ildlife 978 886 787 926
24 ¶Éc®ÉÒ {ÉÖxÉ°ôVVÉÉÒ´ÉxÉ +ÉÉÊ£ÉªÉÉxÉ : 24 Urban Rejuvenation Mission:
+ÉàÉßiÉ +ÉÉè® ºàÉÉ]Ç ÉÊºÉ]ÉÒ ÉÊàÉ¶ÉxÉ AMRUT and Smart Cities Mission 12085 13750 9842 13750
25 {ÉÖÉÊãÉºÉ ¤ÉãÉ BÉEÉ +ÉÉvÉÖÉÊxÉBÉEÉÒBÉE®hÉ 25 Modernisation of Police Forces 3260 3462 4155 3162
26 xªÉÉªÉ{ÉÉÉÊãÉBÉEÉ +É´ÉºÉÆ®SÉxÉÉ 26 Infrastructure Facilities for
ºÉÖÉÊ´ÉvÉÉAÆ Judiciary 657 720 990 762
27 ºÉÉÒàÉÉ FÉäjÉ ÉÊ´ÉBÉEÉºÉ BÉEÉªÉÇ#ÉEàÉ 27 Border Area Development Programme 771 825 825 784
28 ¶ªÉÉàÉÉ |ÉºÉÉn àÉÖJÉVÉÉÒÇ âó¤ÉÇxÉ 28 Shyama Prasad Mukherjee
ÉÊàÉ¶ÉxÉ Rurban Mission 433 800 300 600
29 ®É]ÅÉÒªÉ OÉÉàÉ º´É®ÉVÉ +ÉÉÊ£ÉªÉÉxÉ 29 Rashtriya Gram Swaraj Abhiyan
(+ÉÉ®.VÉÉÒ.AºÉ.A.) (RGSA) 649 822 465 858
30 {ÉÉÒAàÉVÉäA´ÉÉ<Ç +ÉÉªÉÖàÉÉxÉ £ÉÉ®iÉ 30 PMJAY-Ayushman Bharat 2602 6556 3314 6429
(MÉ) |ÉàÉÖJÉ BÉäE xpÉÒªÉ FÉäjÉ BÉEÉÒ ºBÉEÉÒàÉå (C) Major Central Sector Schemes
31 ¤ÉÉVÉÉ® cºiÉFÉä{É ªÉÉäVÉxÉÉ +ÉÉè® 31 Market Intervention Scheme and
àÉÚãªÉ ºÉàÉlÉÇxÉ ªÉÉäVÉxÉÉ Price Support Scheme
(AàÉ+ÉÉ<ÇAºÉ-{ÉÉÒAºÉAºÉ) (MIS-PSS) 1400 3000 2010 2000
32 {ÉEºÉãÉ ¤ÉÉÒàÉÉ ªÉÉäVÉxÉÉ 32 Crop Insurance Scheme 11937 14000 13641 15695
33 ÉÊB ÉEºÉÉxÉÉå BÉEÉä +Éã{ÉÉ´ÉÉÊvÉ jÉ@hÉ BÉäE 33 Interest Subsidy for Short Term
ÉÊãÉA ¤ªÉÉVÉ ºÉÉÎ¤ºÉbÉÒ Credit to Farmers 11496 18000 17863 21175
34 }ÉEºÉãÉ +É´É¶ÉäÉ BÉäE º´ÉºlÉÉxÉä 34 Promotion of Agricultural
|É¤ÉÆvÉxÉ BÉäE ÉÊãÉA BÉßEÉÊÉ Mechanization for in-situ Management
ªÉÉÆÉÊjÉBÉEÉÒBÉE®hÉ BÉEÉ ºÉÆ´ÉvÉÇxÉ of Crop Residue 584 600 594 600
35 BÉEãªÉÉhÉ ªÉÉäVÉxÉÉ+ÉÉå BÉäE ÉÊãÉA 35 Distribution of Pulses to State /
®ÉVªÉ/ºÉÆPÉ ®ÉVªÉ FÉäjÉÉå BÉEÉä nÉãÉ Union Territories for
BÉEÉ ÉÊ´ÉiÉ®hÉ Welfare Scheme ... 800 370 800
36 |ÉvÉÉxÉàÉÆjÉÉÒ ÉÊB ÉEºÉÉxÉ ºÉààÉÉxÉ ÉÊxÉÉÊvÉ 36 Pradhan Mantri Kisan Samman
({ÉÉÒAàÉ - ÉÊB ÉEºÉÉxÉ) Nidhi (PM-Kisan) 1241 75000 54370 75000
37 {ÉEºÉãÉ ÉÊ´ÉYÉÉxÉ 37 Crop Science 652 702 635 716
38 +ÉxÉÖºÉÆvÉÉxÉ A´ÉÆ ÉÊ´ÉBÉEÉºÉ àÉÚãÉ£ÉÚiÉ 38 R and D Basic Science
ÉÊ´ÉYÉÉxÉ A´ÉÆ +ÉÉÊ£ÉªÉÉÆÉÊjÉBÉEÉÒ and Engineering 1021 1320 1170 1250
39 AªÉ® <ÆÉÊbªÉÉ {ÉÉÊ®ºÉÆ{ÉÉÊkÉ vÉÉ®BÉE 39 Air India Asset Holding
ÉÊãÉÉÊàÉ]äb (AºÉ{ÉÉÒ´ÉÉÒ) Limited (SPV) 1300 2600 2600 2205
17

2018-2019 2019-2020 2019-2020 2020-2021
40 BÉEÉäªÉãÉÉ +ÉÉè® ÉÊãÉMxÉÉ<Ç] BÉEÉ 40 Exploration of Coal and

+Éx´ÉäÉhÉ Lignite 448 937 755 700
41 <Ç ºÉÉÒ VÉÉÒ ºÉÉÒ(ÉÊxÉªÉÉÇiÉ #ÉäEÉÊb] 41 Investment in ECGC (Export Credit
MÉÉ®Æ]ÉÒ ÉÊxÉMÉàÉ) àÉå ÉÊxÉ´Éä¶É Guarantee Corporation) 500 500 800 650
42 ¤ªÉÉVÉ ºÉàÉBÉE®hÉ ºBÉEÉÒàÉ 42 Interest Equalisation Scheme 2600 2910 2868 2300
43 ®É]ÅÉÒªÉ +ÉÉètÉÉäÉÊMÉBÉE BÉEÉì®ÉÒbÉä® 43 National Industrial Corridor
ÉÊ´ÉBÉEÉºÉ A´ÉÆ BÉEÉªÉÉÇx´ÉªÉxÉ xªÉÉºÉ Development and Implementation
(AxÉ+ÉÉ<ÇºÉÉÒbÉÒ+ÉÉ<Ç]ÉÒ) Trust (NICDIT) 1097 850 950 1200
44 ÉÊxÉÉÊvÉªÉÉå BÉEÉ BÉEÉäÉ 44 Fund of Funds ... 100 431 1055
45 {ÉÚ´ÉÉäÇkÉ® FÉäjÉ +ÉÉè® ÉÊcàÉÉãÉªÉÉÒ 45 Refund of Central and
®ÉVªÉÉå àÉå +ÉÉètÉÉäÉÊMÉBÉE <BÉEÉ<ªÉÉå Integrated GST to Industrial
BÉäE ÉÊãÉA BÉäÆEpÉÒªÉ +ÉÉè® ABÉEÉÒBÉßEiÉ Units in North Eastern Region
VÉÉÒAºÉ]ÉÒ BÉEÉÒ ´ÉÉ{ÉºÉÉÒ and Himalayan States 1500 1700 2100 1716
46 ®FÉÉ ºÉä´ÉÉ+ÉÉå BÉäE ÉÊãÉA +ÉÉÉÎ{]BÉEãÉ 46 Optical Fibre Cable based network
{ÉEÉ<¤É® BÉäE¤ÉãÉ +ÉÉvÉÉÉÊ®iÉ xÉä]´ÉBÉÇE for Defence Services 1927 4725 4725 5000
47 nÚ®ºÉÆSÉÉ® +É´ÉºÉÆ®SÉxÉÉ BÉäE ºÉßVÉxÉ 47 Compensation to Service Providers
A´ÉÆ ºÉÆ´ÉvÉÇxÉ BÉäE ÉÊãÉA ºÉä´ÉÉ for creation and augmentation of
|ÉnÉiÉÉ+ÉÉå BÉEÉä FÉÉÊiÉ{ÉÚÉÊiÉÇ telecom infrastructure (Bharat Net) 4788 8350 3000 8000
48 àÉÚãªÉ ÉÎºlÉ®ÉÒBÉE®hÉ BÉEÉäÉ 48 Price Stabilisation Fund 1500 2000 1820 2000
49 {ÉÚ´ÉÉäÇkÉ® {ÉÉÊ®Én BÉEÉÒ ºBÉEÉÒàÉå 49 Schemes of North East Council 378 580 385 606
50 {ÉÚ´ÉÉäÇkÉ® A´ÉÆ ÉÊºÉÉÎBÉDBÉEàÉ BÉäE ÉÊãÉA 50 Central Pool of Resources for
BÉäÆEpÉÒªÉ ºÉÆºÉÉvÉxÉ {ÉÚãÉ North East and Sikkim 526 531 576 552
51 {ÉÚ´ÉÉäÇkÉ® ºÉ½BÉE FÉäjÉ ÉÊ´ÉBÉEÉºÉ 51 North East Road Sector Development
ºBÉEÉÒàÉ Scheme 371 666 662 800
52 {ÉÚ´ÉÉäÇkÉ® FÉäjÉ ÉÊ´É¶ÉäÉ +É´ÉºÉÆ®SÉxÉÉ 52 North East Special Infrastructure
ÉÊ´ÉBÉEÉºÉ ºBÉEÉÒàÉ Development Scheme
(AxÉ<ÇAºÉ+ÉÉ<ÇbÉÒAºÉ) (NESIDS) 94 695 558 674
53 ºÉàÉÖpÉÒ ºÉä´ÉÉAÆ, àÉÉìbÉÊãÉÆMÉ, 53 Ocean services, Modelling,
+ÉxÉÖ|ÉªÉÉäMÉ, ºÉÆºÉÉvÉxÉ +ÉÉè® Application, Resources and
|ÉÉètÉÉäÉÊMÉBÉEÉÒ (+ÉÉä-ºàÉÉ]Ç) Technology (O-SMART) ... 483 445 567
54 <ãÉäBÉD]ÅÉìÉÊxÉBÉEÉÒ / +ÉÉ<Ç]ÉÒ cÉbÇ´ÉäªÉ® 54 Promotion of Electronics and
ÉÊ´ÉÉÊxÉàÉÉÇhÉ BÉEÉä |ÉÉäiºÉÉcxÉ IT HW Manufacturing (MSIPS,
(AàÉAºÉ+ÉÉ<Ç{ÉÉÒAºÉ, <ÇbÉÒA{ÉE +ÉÉè® EDF and Manufacturing 727 986 690 980
ÉÊ´ÉÉÊxÉàÉÉÇhÉ BÉDãÉº]ºÉÇ) Clusters)
55 +ÉÉ<Ç]ÉÒ / <ãÉäB ÉD]ÅÉìÉÊxÉBÉEÉÒ / 55 R and D in IT/Electronics/CCBT 179 416 435 763
ºÉÉÒºÉÉÒ¤ÉÉÒ]ÉÒ àÉå +ÉxÉÖºÉÆvÉÉxÉ +ÉÉè®
ÉÊ´ÉBÉEÉºÉ
56 AÉÎBÉDVÉàÉ ¤ÉéBÉE 56 Exim Bank 629 779 1153 779
57 ®É]ÅÉÒªÉ ÉÊxÉ´Éä¶É +ÉÉè® +É´ÉºÉÆ®SÉxÉÉ 57 National Investment and
ÉÊxÉÉÊvÉ (AxÉ+ÉÉ<Ç+ÉÉ<ÇA{ÉE) Infrastructure Fund (NIIF) 1196 1000 2003 503
58 ®É]ÅÉÒªÉ BÉßEÉÊÉ +ÉÉè® OÉÉàÉÉÒhÉ 58 Subscription to Share Captial of
ÉÊ´ÉBÉEÉºÉ ¤ÉéB ÉE (xÉÉ¤ÉÉbÇ) BÉEÉÒ ¶ÉäªÉ® National Bank for Agricultural and
{ÉÚÆVÉÉÒ àÉå +ÉÉÊ£ÉnÉxÉ Rural Development (NABARD) 2000 1500 1500 1000
59 ¤ÉÉÒàÉÉ BÉEà{ÉÉÊxÉªÉÉä BÉEÉ {ÉÖxÉ : 59 Re-capitalization of Insurance
{ÉÚÆVÉÉÒB ÉE®hÉ Companies ... 0 2500 6950
60 £ÉÉ®iÉ BÉEÉ AÉÎBÉDºÉàÉ ¤ÉéB ÉE BÉEÉÒ 60 Subscription to the Share Capital
¶ÉäªÉ® {ÉÚÆVÉÉÒ àÉå +ÉÉÊ£ÉnÉxÉ of Export-Import Bank of India 500 950 950 1300
61 JÉÖ®{ÉBÉEÉ +ÉÉè® àÉÖÆc{ÉBÉEÉ ®ÉäMÉ ( 61 National Animal Disease Control
A{ÉE AàÉ bÉÒ ) +ÉÉè® ¥ÉÖºÉãÉÉäÉÊºÉºÉ Programme for Foot and Mouth
BÉäE ÉÊxÉªÉÆjÉhÉ cäiÉÖ ®É]ÅÉÒªÉ {É¶ÉÖ Disease (FMD) and
®ÉäMÉ ÉÊxÉªÉÆjÉhÉ BÉEÉªÉÇ#ÉEàÉ Brucellosis ... 500 811 1300
62 |ÉvÉÉxÉ àÉÆjÉÉÒ ÉÊBÉEºÉÉxÉ ºÉà{ÉnÉ 62 Pradhan Mantri Kisan Sampada
ªÉÉäVÉxÉÉ Yojana 592 1101 889 1081
63 ®É]ÅÉÒªÉ AbÂºÉ A´ÉÆ ªÉÉèxÉ ºÉÆSÉÉÉÊ®iÉ 63 National AIDS and STD
®ÉäMÉ ÉÊxÉªÉÆjÉhÉ BÉEÉªÉÇ#ÉEàÉ Control Programme 1803 2500 2956 2900
64 {ÉÉÊ®´ÉÉ® BÉEãªÉÉhÉ ªÉÉäVÉxÉÉAÆ 64 Family Welfare Schemes 490 700 514 600
65 |ÉvÉÉxÉàÉÆjÉÉÒ º´ÉÉºlªÉ ºÉÖ®FÉÉ 65 Pardhan Mantri Swasthya
ªÉÉäVÉxÉÉ Suraksha Yojana 3797 4000 4733 6020
66 £ÉÉ®iÉ àÉå (cÉ<ÉÊ¥Éb +ÉÉè®) 66 Scheme for Faster Adoption and
<ãÉäÉÎBÉD]ÅB ÉE ´ÉÉcxÉÉå BÉäE iÉÉÒµÉ Manufacturing of (Hybrid and)
+ÉÆMÉÉÒBÉE®hÉ +ÉÉè® ÉÊ´ÉÉÊxÉàÉÉÇhÉ cäiÉÖ Electric Vehicle in India -
ªÉÉäVÉxÉÉ-({ÉäEàÉ <ÆÉÊbªÉÉ ) (FAME - India). 145 500 500 693
67 àÉÉÊcãÉÉ+ÉÉå BÉEÉÒ ºÉÖ®FÉÉ cäiÉÖ 67 Schemes for Safety of
ªÉÉäVÉxÉÉ Women 50 50 50 855
68 àÉä]ÅÉä {ÉÉÊ®ªÉÉäVÉxÉÉAÆ 68 Metro Projects 14265 17714 17612 17482
69 ®É]ÅÉÒªÉ ®ÉVÉvÉÉxÉÉÒ FÉäjÉ {ÉÉÊ®´ÉcxÉ 69 National Capital Region
ÉÊxÉMÉàÉ Transport Corporation 100 974 824 2487
70 =SSÉiÉ® ÉÊ¶ÉFÉÉ ÉÊxÉÉÊvÉªÉxÉ 70 Higher Education Financing
+ÉÉÊ£ÉBÉE®hÉ (ASÉ<ÇA{ÉEA) Agency (HEFA) 2263 2100 2100 2200
18

2018-2019 2019-2020 2019-2020 2020-2021
71 MÉÉ®Æ]ÉÒ ÉÊxÉÉÊvÉ BÉäE ÉÊãÉA ¤ªÉÉVÉ 71 Interest Subsidy and contribution

ºÉcÉªÉiÉÉ iÉlÉÉ +ÉÆ¶ÉnÉxÉ for Guarantee Funds 1575 1900 1900 1900
72 ®É]ÅÉÒªÉ MÉÆMÉÉ ªÉÉäVÉxÉÉ +ÉÉè® PÉÉ] 72 National Ganga Plan and
ÉÊxÉàÉÉÇhÉ BÉEÉªÉÇ Ghat Works 688 750 353 800
73 ®É]ÅÉÒªÉ xÉnÉÒ ºÉÆ®FÉhÉ ªÉÉäVÉxÉÉ 73 National River Conservation Plan 1620 1220 1200 840
74 BÉEàÉÇSÉÉ®ÉÒ {Éå¶ÉxÉ ºBÉEÉÒàÉ, 1995 74 Employees Pension Scheme, 1995 4900 4500 6076 7457
75 |ÉvÉÉxÉàÉÆjÉÉÒ ®ÉäVÉMÉÉ® ºÉßVÉxÉ 75 Prime Minister Employment
BÉEÉªÉÇ#ÉEàÉ ({ÉÉÒAàÉ<ÇVÉÉÒ{ÉÉÒ) Generation Programme (PMEGP) 2119 2327 2464 2500
76 +É´ÉºÉÆ®SÉxÉÉ ÉÊ´ÉBÉEÉºÉ +ÉÉè® FÉàÉiÉÉ 76 Infrastructure Development and
ÉÊxÉàÉÉÇhÉ Capacity Building 309 420 471 802
77 ÉÊ¶ÉFÉÉ ºÉ¶ÉÉÊkÉEBÉE®hÉ 77 Education Empowerment 1986 2363 2249 2530
78 BÉEÉè¶ÉãÉ ÉÊ´ÉBÉEÉºÉ +ÉÉè® VÉÉÒ´ÉxÉ 78 Skill Development and
¶ÉèãÉÉÒ Livelihoods 482 557 582 602
79 {É´ÉxÉ ÉÊ´ÉtÉÖiÉ 79 Wind Power 950 920 1026 1299
80 ºÉÉè® ÉÊ´ÉtÉÖiÉ 80 Solar Power 1904 2480 1789 2150
81 ÉÊB ÉEºÉÉxÉ >óVÉÉÇ ºÉÖ®FÉÉ A´ÉÆ =ilÉÉxÉ 81 Kisan Urja Suraksha evam Utthaan
àÉcÉÉÊ£ÉªÉÉxÉ (BÉäEªÉÚAºÉªÉÚAàÉ) Mahabhiyan(KUSUM) ... ... ... 700
82 {ÉÚEãÉ{ÉÖ® vÉÉàÉ®É cÉÎãnªÉÉ 82 Phulpur Dhamra Haldia Pipeline
{ÉÉ<{ÉãÉÉ<xÉ {ÉÉÊ®ªÉÉäVÉxÉÉ Project 1207 1552 1552 728
83 BÉESSÉä iÉäãÉ £ÉÆbÉ® BÉäE ÉÊãÉA 83 Payment to Indian Strategic
<ÆÉÊbªÉxÉ º]Åä]äÉÊVÉBÉE {Éä]ÅÉäÉÊãÉªÉàÉ Petroleum Reserve Limited
ÉÊ®VÉ´ÉÇºÉ ÉÊãÉÉÊàÉ]äb (ISPRL) for Crude Oil 608 1 1 690
(+ÉÉ<ÇAºÉ{ÉÉÒ+ÉÉ®AãÉ) BÉEÉä £ÉÖMÉiÉÉxÉ Reserve
84 MÉ®ÉÒ¤É {ÉÉÊ®´ÉÉ®Éå BÉEÉä AãÉ{ÉÉÒVÉÉÒ 84 LPG Connection to Poor
BÉExÉäBÉD¶ÉxÉ (ºÉÉè£ÉÉMªÉ) Households (Saubhagya) 3200 2724 3724 1118
85 nÉÒxÉnªÉÉãÉ ={ÉÉvªÉÉªÉ OÉÉàÉ VªÉÉäÉÊiÉ 85 Deen Dayal Upadhyaya Gram
ªÉÉäVÉxÉÉ Jyoti Yojna 3800 4066 4066 4500
86 ABÉEÉÒB ÉßEiÉ ÉÊ´ÉtÉÖiÉ ÉÊ´ÉBÉEÉºÉ ªÉÉäVÉxÉÉ 86 Integrated Power Development
Scheme 3897 5280 5663 5300
87 {ÉÉ´É® ÉÊºÉº]àºÉ BÉEÉ ºÉÖo¸ÉÒBÉE®hÉ 87 Strengthening of Power Systems 2802 1478 1860 1843
88 {ÉÉ´É® ÉÊºÉº]àÉ bä´ÉãÉ{ÉàÉå] {ÉÆEb 88 Power System Development Fund 544 1035 574 574
89 {ÉÖãÉ ºÉÆ¤ÉÆvÉÉÒ BÉEÉªÉÇ 89 Bridge Works 532 745 753 777
90 àÉcÉxÉMÉ® {ÉÉÊ®´ÉcxÉ {ÉÉÊ®ªÉÉäVÉxÉÉAÆ 90 Metropolitan Transportation Projects 1164 1600 1580 1400
91 ºÉ½BÉE ÉÊxÉàÉÉÇhÉ BÉEÉªÉÇ 91 Road Works 37811 45880 45887 48759
92 £ÉÉ®iÉÉÒªÉ ®É]ÅÉÒªÉ ®ÉVÉàÉÉMÉÇ 92 National Highways Authority
|ÉÉÉÊvÉBÉE®hÉ of India 39287 36691 36691 42500
93 ÉÊ´ÉYÉÉxÉ +ÉÉè® |ÉÉètÉÉäÉÊMÉBÉEÉÒ 93 Science and Technology Institutional
ºÉÆºlÉÉMÉiÉ A´ÉÆ àÉÉxÉ´ÉÉÒªÉ FÉàÉiÉÉ and Human Capacity
ÉÊxÉàÉÉÇhÉ Building 989 1085 1076 1163
94 +ÉxÉÖºÉÆvÉÉxÉ +ÉÉè® ÉÊ´ÉBÉEÉºÉ 94 Research and Development 472 611 589 718
95 xÉ´ÉÉäxàÉäÉ, |ÉÉètÉÉäÉÊMÉBÉEÉÒ ÉÊ´ÉBÉEÉºÉ 95 Innovation, Technology Development
+ÉÉè® {ÉÉÊ®ÉÊxÉªÉÉäVÉxÉ and Deployment 773 872 812 1051
96 VÉè´É |ÉÉètÉÉäÉÊMÉBÉEÉÒ +ÉxÉÖºÉÆvÉÉxÉ +ÉÉè® 96 Biotechnology Research and
ÉÊ´ÉBÉEÉºÉ Development 1329 1475 1315 1580
97 +ÉÆiÉÉÊ®FÉ |ÉÉètÉÉäÉÊMÉBÉEÉÒ 97 Space Technology 6383 8408 8991 9762
98 +ÉÆiÉÉÊ®FÉ +ÉxÉÖ|ÉªÉÉäMÉ 98 Space Applications 1811 1885 1863 1810
99 <xºÉè] ={ÉOÉc |ÉhÉÉÉÊãÉªÉÉÆ 99 INSAT Satellite Systems 1593 884 1009 751
100 FÉàÉiÉÉ BÉEÉ ÉÊ´ÉBÉEÉºÉ (ºÉÉÒbÉÒ) 100 Capacity Development (CD) 216 529 529 706
101 ºÉÉÆºÉn ºlÉÉxÉÉÒªÉ FÉäjÉ ÉÊ´ÉBÉEÉºÉ 101 Member of Parliament Local Area
ªÉÉäVÉxÉÉ (AàÉ{ÉÉÒAãÉAbÉÒ) Development Scheme (MPLAD) 3950 3960 3960 3960
102 ºÉÆ¶ÉÉäÉÊvÉiÉ |ÉÉètÉÉäÉÊMÉBÉEÉÒ =xxÉªÉxÉ 102 Amended Technology Upgradation
ÉÊxÉÉÊvÉ ªÉÉäVÉxÉÉ Fund Scheme(ATUFS) 616 700 494 762
103 BÉäExpÉÒªÉ ®ä¶ÉàÉ ¤ÉÉäbÇ 103 Central Silk Board 601 730 765 800
104 ÉÊ´ÉÉÊ¶É] ÉÊ´ÉÉªÉÉå BÉäE +ÉÉºÉ{ÉÉºÉ 104 Integrated Development of Tourist
{ÉªÉÇ]xÉ ºÉÉÊBÉÇE] BÉäE ºÉàÉÉÎx´ÉiÉ Circuits around specific themes
ÉÊ´ÉBÉEÉºÉ (º´Énä¶É n¶ÉÇxÉ) (Swadesh Darshan) 1101 1106 566 1200
105 ABÉEãÉ´ªÉ +ÉÉn¶ÉÇ +ÉÉ´ÉÉºÉÉÒªÉ 105 Eklavya Model Residential School
ÉÊ´ÉtÉÉãÉªÉ (EMRS) ... 0 16 1313
106 JÉäãÉÉä <ÉÎhbªÉÉ 106 Khelo India 342 500 578 890
107 º´ÉiÉÆjÉiÉÉ ºÉäxÉÉxÉÉÒ ({Éå¶ÉxÉ A´ÉÆ +ÉxªÉ 107 Freedom Fighters (pension and other
ãÉÉ£É) benefits) 875 953 953 775
108 ºÉÉÒàÉÉ +É´ÉºÉÆ®SÉxÉÉ A´ÉÆ |É¤ÉÆvÉxÉ 108 Border Infrastructure and Management 2030 2129 2128 1997
109 {ÉÖÉÊãÉºÉ +É´ÉºÉÆ®SÉxÉÉ 109 Police Infrastructure 5085 4757 4479 4135
110 #ÉäEÉÊb] ºÉÆ¤Ér {ÉÚÆVÉÉÒMÉiÉ ºÉÉÎ¤ºÉbÉÒ 110 Credit Linked Capital Subsidy and
A´ÉÆ |ÉÉètÉÉäÉÊMÉBÉEÉÒ =xxÉªÉxÉ ªÉÉäVÉxÉÉ Technology Upgradation Scheme 1007 706 806 654
111 ®äãÉ àÉÆjÉÉãÉªÉ BÉEÉÒ ªÉÉäVÉxÉÉ+ÉÉå BÉEÉä 111 Budgetary Support to Schemes of
¤ÉVÉ]ÉÒªÉ ºÉcÉªÉiÉÉ Ministry of Railways 54913 68019 69967 72216
112 ºÉÉMÉ®àÉÉãÉÉ 112 Sagarmala 360 550 381 297
113 ¶ÉiÉÉÉÎ¤nªÉÉÆ A´ÉÆ ´ÉÉÇMÉÉÆ~ ºÉàÉÉ®Éäc 113 Centenaries and Anniversaries,
A´ÉÆ ªÉÉäVÉxÉÉAÆ Celebrations and Schemes 156 110 104 160
114 +É´ÉºÉÆ®SÉxÉÉ {ÉÉ<{ÉãÉÉ<xÉ BÉEÉä ºÉcÉªÉiÉÉ 114 Support to Infrastructure Pipeline ... ... ... 12500
115 |ÉvÉÉxÉàÉÆjÉÉÒ àÉÖpÉ ªÉÉäVÉxÉÉ 115 Pradhan Mantri Mudra Yojana 500 500 500 500
116 ÉÊxÉªÉÉÇiÉ #ÉäEÉÊb] BÉäE ÉÊãÉA |Éä® BÉE {ÉèBÉEVÉ 116 Stimulus Package for Export Credit- ... ... ... 95
ÉÊxÉÉÊ´ÉÇBÉE ªÉÉäVÉxÉÉ NIRVIK Yojna
1
ĮęęēĆI - ĐĭēćøĭĝđĸĮøćĮċĮĊ§ēĭÿˢùĭćĭ§ŮĭİɑĒĭŃ
STATEMENT I - CONSOLIDATED FUND OF INDIA - REVENUE ACCOUNT - RECEIPTS
(àøēļģ(In à crores)
đĲƥĚıĜŊ ęĭˑĮęø ďÿĂæċĲđĭċ ĝŃĚļĮĊćæċĲđĭċ ďÿĂæċĲđĭċ
Major Actuals Budget Estimates Revised Estimates Budget Estimates
Head 2018-2019 2019-2020 2019-2020 2020-2021
øøēēĭÿˢ A. TAX REVENUE
øçĒćĈĭʩĒčēøē (a) Taxes on Income and 1125046.98 1322200.00 1157500.00 1306000.00
Expenditure
Įċúđøē Corporation Tax 0020 663571.62 766000.00 610500.00 681000.00
ĮċúđøēøļþļģøēæɊçĒčēøē Taxes on Income Other Than 0021 461487.51 556200.00 547000.00 625000.00
Corporation Tax
ĞļĂĕŮĭİɑĒļŃčēøē Hotel Receipts Tax 0023 0.44 ... ... ...
ɯĭÿøē Interest Tax 0024 3.19 ... ... ...
æċĲĜŃúıĕĭĐøē Fringe Benefit Tax 0026 -31.59 ... ... ...
çĒõēʩĒčēæɊøē Other Taxes on Income and 0028 15.81 ... ... ...
Expenditure
ùĝŃčĮȅõēčĳŃÿıĕĸċ§ĉĸċļŃčēøē (b) Taxes on Property and Capital 11568.36 12800.00 12500.00 13000.00
Transactions
ĝŃčĉĭĚĲʋ Estate Duty 0031 1.12 ... ... ...
ĝŃčĮȅøē Taxes on Wealth 0032 39.74 ... ... ...
ŮĮćĐĳĮćĝŃʩęĞĭēøē Securities Transaction Tax 0034 11527.50 12800.00 12500.00 13000.00
ďœĮøŃúċøĉĝŃʩęĞĭēøē Banking Cash Transaction Tax 0036 ... ... ... ...
úĮÿŃĝļŃćĈĭĝĸęĭôŃčēøē (c) Taxes on Commodities and 941035.87 1122015.00 989243.00 1099520.00
Services
øŐūıĒęˑĲõēĝĸęĭøēĝıÿıðĝĂı Central Goods and Services Tax 0005 457534.01 526000.00 514000.00 580000.00
(CGST)
ĝŃûēĭǛƗĸũęˑĲõēĝĸęĭøē Union Territory Goods and 0007 2778.20 2768.00 2704.00 3000.00
ĒĳĂıÿıðĝĂı Services Tax (UTGST)
ðøıøĴćęˑĲõēĝĸęĭøē Integrated Goods and Services Tax 0008 28944.58 28000.00 ... ...
çéÿıðĝĂı (IGST)
ęˑĲõēĝĸęĭøēƗĮćčĳĮćŊêčøē Goods and Services Tax 0009 95080.71 109343.00 98327.00 110500.00
Compensation Cess
ĝıđĭĚĲʋ Customs 0037 117812.85 155904.00 125000.00 138000.00
øŐūıĒêȋĭĉĚĲʋ Union Excise Duties 0038 230992.59 300000.00 248000.00 267000.00
ĮďŢıøē Sales Tax 0040 ... ... ... ...
ĝĸęĭøē Service Tax 0044 6903.62 ... 1200.00 1020.00
čǻõēĝĸęĭôŃčēæɊøēõēĚĲʋ Other Taxes and Duties on 0045 989.31 ... 12.00 ...
Commodities and Services
ûĮęĊĭċđŃĄĕēĮĞćĝŃûēĭǛƗĸũļŃøĸ (d) Taxes of Union Territories 2814.22 4179.93 4180.00 4500.00
øē without Legislature
ĝøĕøēēĭÿˢ GROSS TAX REVENUE 2080465.43 2461194.93 2163423.00 2423020.00
ĝđĸĮøćĮċĮĊđŐĚĭĮđĕċĮøĒĸúð State's share excluded from the 761454.15 809133.02 656046.07 784180.87
ēĭǛļŃøĭĐĭú Consolidated Fund
øŐūĝēøĭēøĭøēēĭÿˢ Tax Revenue of the Central 1319011.28 1652061.91 1507376.93 1638839.13
Government
ùøē§ĮĐɄēĭÿˢ B. NON-TAX REVENUE
øēĭÿøļĜıĒĝĸęĭðŃ (a) Fiscal Services 743.71 425.50 703.65 750.80
đĲūĭ~ĮĝſĭĮċđĭŊĆõēĂøĝĭĕ Currency, Coinage and Mint 0046 514.49 300.00 530.00 560.00
æɊēĭÿøļĜıĒĝĸęĭðŃ Other Fiscal Services 0047 229.22 125.50 173.65 190.80
ùɯĭÿŮĭİɑĒĭŃ~ĕĭĐĭŃĚćĈĭĕĭĐ (b) Interest Receipts, Dividends and 140564.19 191539.67 250413.25 192737.51
Profits
ɯĭÿŮĭİɑĒĭŃ Interest Receipts 0049 27143.68 28011.23 50520.33 37342.04
ēĭǛõēĝŃûēĭǛƗĸũøıĝēøĭēļŃĝĸ Interest from State and Union 7402.57 5860.34 4670.65 5373.22
ɯĭÿ Territory Governments
æɊɯĭÿŮĭİɑĒĭŃ Other Interest Receipts 19741.11 22150.89 45849.68 31968.82
ĕĭĐĭŃĚõēĕĭĐ Dividends and Profits 0050 113420.51 163528.44 199892.92 155395.47
úæɊøē§ĮĐɄēĭÿˢ (c) Other NonTax Revenue 345080.54 403004.94 393958.94 498305.22
(i) ĝĭđĭɊĝĸęĭðŃ (i) General Services 47322.80 50260.29 51728.78 51878.30
ĕļøĝĸęĭçĒļú Public Service Commission 0051 84.06 103.50 87.00 92.00
čĲĮĕĝ Police 0055 8280.72 10366.10 8610.70 9260.75
ÿĸĕ Jails 0056 0.02 ... ... ...
çčĳĮćŊõēĮċčĂĭċ Supplies and Disposals 0057 0.28 0.05 ... ...
ĕĸùċĝĭđŤıõēþčĭé Stationery and Printing 0058 47.04 29.54 15.47 15.59
ĕļøĮċđĭŊĆøĭĒŊ Public Works 0059 302.47 373.03 583.03 595.03
æɊŮĚĭĝĮċøĝĸęĭðŃ Other Administrative Services 0070 6935.86 7786.43 6708.78 7246.91
čŐĚċõēæɊĝĸęĭĮċęĴĮȅĕĭĐļŃøĸĝŃďŃĊ Contributions and Recoveries 0071 1613.28 2712.93 2633.29 2609.98
đŐæŃĚĉĭċõēęĝĳĮĕĒĭŃ Towards Pension and Other
Retirement Benefits
ĮęĮęĊĝĭđĭɊĝĸęĭðŃ Miscellaneous General Services 0075 21748.08 21527.76 23795.26 23008.56
ēƗĭĝĸęĭðŃ Defence Services 8310.99 7360.95 9295.25 9049.48
ēƗĭĝĸęĭðŃ§Ĉĕĝĸċĭ Defence Services - Army 0076 3544.51 2879.76 3882.75 3616.40
ēƗĭĝĸęĭðŃ§ċĽĝĸċĭ Defence Services - Navy 0077 882.64 500.00 700.00 600.00
ēƗĭĝĸęĭðŃ§ęĭĒĲĝĸċĭ Defence Services - Air Force 0078 1079.29 1000.00 1300.00 1300.00
ēƗĭĝĸęĭðŃ§çĒĲĊøĭēùĭċĸ Defence Services - Ordnance 0079 2191.49 2581.19 3012.50 3233.08
Factories
ēƗĭĝĸęĭðŃ§æċĲĝŃĊĭċõēĮęøĭĝ Defence Services - Research and 0080 613.06 400.00 400.00 300.00
Development
2
ĮęęēĆI - ĐĭēćøĭĝđĸĮøćĮċĮĊ§ēĭÿˢùĭćĭ§ŮĭİɑĒĭŃ
STATEMENT I - CONSOLIDATED FUND OF INDIA - REVENUE ACCOUNT - RECEIPTS
Head 2018-2019 2019-2020 2019-2020 2020-2021
(ii) ĝĭđĭĮÿøćĈĭĝĭđĲĉĭĮĒøĝĸęĭðŃ (ii) Social and Community Services 3079.90 4180.41 3655.18 4268.59
ĮĚƗĭ~ùĸĕ~øĕĭõēĝŃˋĴĮć Education, Sports, Art and Culture 0202 342.19 347.19 386.11 406.64
ĮýĮøȖĭõēÿċˢĭ˖ Medical and Public Health 0210 677.65 678.08 896.53 896.25
čįēęĭēøʞĭĆ Family Welfare 0211 12.89 15.08 17.12 17.12
çęĭĝ Housing 0216 235.58 279.59 322.87 333.31
ĚĞēıĮęøĭĝ Urban Development 0217 ... 0.01 ... ...
ĝĳýċĭõēŮýĭē Information and Publicity 0220 57.53 59.35 55.33 47.55
ŮĝĭēĆ Broadcasting 0221 1319.80 2766.67 1371.25 1962.25
ŵđõēēļÿúĭē Labour and Employment 0230 33.67 34.08 605.39 604.83
ĝĭđĭĮÿøĝĲēƗĭõēøʞĭĆ Social Security and Welfare 0235 1.87 0.36 0.58 0.64
æɊĝĭđĭĮÿøĝĸęĭðŃ Other Social Services 0250 398.72 ... ... ...
(iii) çĮĈŊøĝĸęĭðŃ (iii) Economic Services 292788.31 346415.24 336480.82 439855.77
øĴĮĜøĭĒŊ Crop Husbandry 0401 430.03 614.55 602.90 623.90
čĚĲčĭĕċ Animal Husbandry 0403 33.43 20.97 24.35 25.91
ĄĸĒēıĮęøĭĝ Dairy Development 0404 359.24 410.80 390.54 415.40
đȘčĭĕċ Fisheries 0405 3.08 4.00 3.91 4.21
ęĭĮċøıõēęɊÿıęċ Forestry and Wild Life 0406 33.24 38.00 51.98 52.38
ùĭȨĐǷĭēĆõēĐĭǷĭúĭē Food,Storage and Warehousing 0408 540.53 6.91 600.22 660.25
øĴĮĜæċĲĝŃĊĭċõēĮĚƗĭ Agricultural Research and 0415 ... 0.02 ... ...
Education
æɊøĴĮĜøĭĒŊŢđ Other Agricultural Programmes 0435 22.27 23.55 19.50 19.50
čĳęŖȅēƗĸũ North Eastern Areas 0552 3.45 ... ... ...
ęĴĞćõēđȯđĮĝŃýĭé Major and Medium Irrigation 0701 27.48 42.00 41.00 42.00
ĕûĲĮĝŃýĭé Minor Irrigation 0702 2.97 1.80 2.20 2.50
ĮęĉŀĒĲć Power 0801 3651.31 4270.48 3447.64 3681.20
čĸĂŌļĮĕĒđ Petroleum 0802 14197.38 16930.27 12060.89 14075.14
øļĒĕĭõēĮĕưĭèĂ Coal and Lignite 0803 104.38 3197.85 3202.30 3203.85
ëÿĭŊøĸúĹēčēɼēĭúćŷļć Non-Conventional Sources of 0810 0.04 0.12 0.06 0.06
Energy
ŤĭđðęŃĕûĲêȨļú Village and Small Industries 0851 89.91 23.18 25.83 25.83
êȨļú Industries 0852 2068.71 2557.87 2728.04 3411.39
æĕĽĞùċċõēĊĭćĲøđŊêȨļú Non-Ferrous Mining and 0853 287.55 377.29 570.92 510.92
Metallurgical Industries
æɊêȨļú Other Industries 0875 155.69 150.00 150.00 150.00
ĐĭēćıĒēĸĕęĸ§ĮęĮęĊŮĭİɑĒĭŃ Indian Railways - Miscellaneous 1001 600.79 260.00 436.00 300.00
Receipts
ĐĭēćıĒēĸĕęĸ§ęĭĮĆİǛøĕĭèċ§ēĭÿˢ Indian Railways - Commercial 1002 187738.49 214590.13 203734.90 223397.37
ŮĭİɑĒĭŃ Lines - Revenue Receipts
ĐĭēćıĒēĸĕęĸ§ĝĭđįēøĕĭèċ§ēĭÿˢ Indian Railways - Strategic Lines - 1003 2168.08 2084.87 2098.10 2215.63
ŮĭİɑĒĭŃ Revenue Receipts
ďŃĉēúĭĞõēŮøĭĚˑŃĐ Ports and Light Houses 1051 307.14 320.00 320.00 320.00
čļćčįēęĞċ Shipping 1052 98.41 121.29 138.26 142.15
ċĭúēĮęđĭċċ Civil Aviation 1053 133.54 115.51 420.05 473.05
ĝģøõēčĲĕ Roads and Bridges 1054 19866.00 20339.64 21588.61 25160.66
æŃćĉőĚıĒÿĕčįēęĞċ Inland Water Transport 1056 24.72 ... ... ...
ĄĭøŮĭİɑĒĭŃ Postal Receipts 1201 13195.68 19203.29 19203.29 18710.05
æɊĝŃýĭēĝĸęĭðŃ Other Communication Services 1275 40815.73 50519.81 58989.64 133027.20
čēđĭĆĲëÿĭŊæċĲĝŃĊĭċ Atomic Energy Research 1401 115.16 99.06 103.38 99.14
æɊęĹǒĭĮċøæċĲĝŃĊĭċ Other Scientific Research 1425 1605.16 2208.99 1414.36 1547.28
čĒŊĂċ Tourism 1452 18.73 10.00 5.00 5.00
ĮęĉĸĚıʩĭčĭēõēĮċĒĭŊćĝŃęȠŊċ Foreign Trade and Export 1453 313.38 252.90 344.87 344.87
Promotion
ċĭúįēøçčĳĮćŊ Civil Supplies 1456 0.10 0.15 0.12 0.12
æɊĝĭđĭɊçĮĈŊøĝĸęĭðŃ Other General Economic Services 1475 3776.51 7619.94 3761.96 7208.81
(iv) ĝŃûēĭǛƗĸũļŃøĸøēĮĐɄēĭÿˢ (iv) Non-Tax Revenue of Union 1889.53 2149.00 2094.16 2302.56
Territories
úĝĞĭĒćĭæċĲĉĭċćĈĭæŃĚĉĭċ C. GRANTS-IN-AID AND 1063.19 1006.00 974.00 812.00
CONTRIBUTIONS
ĮęĉĸĚıæċĲĉĭċĝĞĭĒćĭ External Grant Assistance 1605 833.20 650.00 361.00 400.00
ĝĞĭĒćĭĝĭđŤıõēêčˋē Aid Material and Equipment 1606 229.99 356.00 613.00 412.00
ÿļģ§øēĮĐɄēĭÿˢ TOTAL - NON-TAX REVENUE 487451.63 595976.11 646049.84 692605.53
ÿļģ§ēĭÿˢŮĭİɑĒĭŃ TOTAL - REVENUE RECEIPTS 1806462.91 2248038.02 2153426.77 2331444.66
æŤĸċıćčĴʿ±ĉĸùŐ Carried Over (see page 6)
ŮĭİɑĒļŃøıćĲĕċĭđŐæĮćįēƅĝŃĮęćēđ Excess of Disbursements over 455107.90 485503.09 500337.95 609294.42
ēĭÿˢûĂĭ Receipts (Revenue Deficit)
ÿļģ TOTAL 2261570.81 2733541.11 2653764.72 2940739.08
3
ĮęęēĆI - ĐĭēćøĭĝđĸĮøćĮċĮĊ§ēĭÿˢùĭćĭ§ĝŃĮęćēĆ
STATEMENT I - CONSOLIDATED FUND OF INDIA - REVENUE ACCOUNT - DISBURSEMENTS
(àøēļģ(In àcrores)
Head 2018-2019 2019-2020 2019-2020 2020-2021
ø ĝĭđĭɊĝĸęĭðŃ A. GENERAL SERVICES 1100282.99 1207731.18 1221450.44 1325887.76
ø ēĭǛļŃøĸæŃú (a) Organs of State 8538.68 9397.31 9482.12 9186.26
ĝŃĝĉēĭǛĝŃûēĭǛƗĸũļŃøĸĮęĊĭċ Parliament/State/Union Territory 2011 1085.86 1210.17 1188.63 1247.39
đŃĄĕ Legislatures
ēĭʼŌčĮćêčēĭʼŌčĮćēĭǛčĭĕĝŃûēĭǛ President, Vice President/Governor, 2012 67.51 86.43 84.27 90.03
ƗĸũļŃøĸŮĚĭĝø Administrator of Union Territories
đŃĮũčįēĜĉ Council of Ministers 2013 862.79 829.01 925.07 1140.02
ɊĭĒŮĚĭĝċ Administration of Justice 2014 908.81 913.69 874.63 916.09
ýĲċĭę Elections 2015 1130.18 1691.23 1635.52 756.00
ĕĸùĭčēıƗĭ Audit 2016 4483.53 4666.78 4774.00 5036.73
ù øēĝŃŤĞĆ (b) Tax Collection 16536.59 17006.04 17097.12 18186.30
çĒõēʩĒčēøēļŃøĭĝŃŤĞĆ Collection of Taxes on Income and 2020 6991.43 6969.71 6974.36 7663.21
Expenditure
ĝŃčĮȅøēļŃ~ŮĮćĐĳĮćĝŃďŃĊıĝŃʩęĞĭēøēļŃ Collection of Taxes on Wealth, 2031 176.85 175.91 176.04 193.33
ćĈĭæɊøēļŃøĭĝŃŤĞĆ Securities Transaction Tax and
Other Taxes
ĝıđĭĚĲʋ Customs 2037 4418.62 4487.77 4629.57 4842.01
øŐūıĒêȋĭĉĚĲʋ Union Excise Duties 2038 ... ... ... ...
øŐūıĒęˑĲõēĝĸęĭøēðęŃðøıøĴć Collection Charges under Central 2042 4949.69 5372.65 5317.15 5487.75
ęˑĲõēĝĸęĭøēøĸæŃćúŊćĝŃŤĞĆ Goods and Services Tax and
Integrated Goods and Services
ŮĐĭē
Tax
ú æɊēĭÿøļĜıĒĝĸęĭðŃ (c) Other Fiscal Services 285.79 330.28 342.09 594.07
û ɯĭÿĐĲúćĭċćĈĭìĆøĭĚļĊċ (d) Interest Payment and Servicing 595552.17 673470.60 663297.18 733203.16
of Debt
ìĆøıøĂĽćıĒĭčįēęÿŊċøĸĮĕð Appropriation for Reduction or 2048 21.93 2000.00 4677.53 5000.00
ĮęĮċĒļú Avoidance of Debt
ɯĭÿĐĲúćĭċ Interest Payments 2049 595530.24 671470.60 658619.65 728203.16
ü ŮĚĭĝĮċøĝĸęĭðŃ (e) Administrative Services 98577.47 104060.94 110735.14 113968.61
ĕļøĝĸęĭçĒļú Public Service Commission 2051 423.16 538.67 592.08 547.04
ĝĮýęĭĕĒ§ĝĭđĭɊĝĸęĭðŃ Secretariat-General Services 2052 6721.37 6484.92 7289.22 7742.30
čĲĮĕĝ Police 2055 80406.35 85114.70 90624.89 93596.87
ÿĸĕ Jails 2056 0.55 2.00 1.00 1.50
çčĳĮćŊõēĮċčĂĭċ Supplies and Disposals 2057 25.00 50.00 50.00 25.00
ĕĸùċĝĭđŤıõēþčĭé Stationery and Printing 2058 81.55 110.78 83.26 77.85
ĮęĉĸĚıđĭđĕĸ External Affairs 2061 8202.14 8717.49 9154.63 8876.09
ĝćøŊćĭ Vigilance 2062 33.98 131.84 54.66 111.70
ý čŐĚċćĈĭĮęĮęĊĝĭđĭɊĝĸęĭðŃ (f) Pensions and Miscellaneous 176909.73 194203.30 205299.78 232380.88
General Services
čŐĚċõēæɊĝĸęĭĮċęĴĮȅĕĭĐ Pensions and other Retirement 2071 160211.49 175299.65 185147.29 211681.75
Benefits
ĮęĮęĊĝĭđĭɊĝĸęĭðŃ Miscellaneous General Services 2075 16698.24 18903.65 20152.49 20699.13
þ ēƗĭĝĸęĭðŃ (g) Defence Services 203882.56 209262.71 215197.01 218368.48
ēƗĭĝĸęĭðŃ§Ĉĕĝĸċĭ Defence Services - Army 2076 141829.61 144380.95 147843.28 150556.91
ēƗĭĝĸęĭðŃ§ċĽĝĸċĭ Defence Services - Navy 2077 21738.88 22711.71 23486.71 23534.75
ēƗĭĝĸęĭðŃ§ęĭĒĲĝĸċĭ Defence Services - Air Force 2078 29370.54 30601.69 31251.69 31262.66
ēƗĭĝĸęĭðŃ§çĒĲĊøĭēùĭċĸ Defence Services - Ordnance 2079 2512.09 2631.77 3208.33 3919.68
Factories
ēƗĭĝĸęĭðŃ§æċĲĝŃĊĭċõēĮęøĭĝ Defence Services - Research and 2080 8431.44 8936.59 9407.00 9094.48
Development
ù ĝĭđĭĮÿøĝĸęĭðŃ B. SOCIAL SERVICES 103676.90 128694.50 136809.18 154845.81
ĝĭđĭɊĮĚƗĭ General Education 2202 21635.84 30871.21 32513.78 32938.67
ćøċıøıĮĚƗĭ Technical Education 2203 15744.87 14141.67 13799.67 14778.65
ùĸĕõēĒĲęĭđĭđĕĸ Sports and Youth Services 2204 1694.51 1968.26 2501.46 2507.97
øĕĭõēĝŃˋĴĮć Art and Culture 2205 2467.46 2742.65 2318.84 2961.55
ÿĕĭčĳĮćŊõēˢǅćĭ Water Supply and Sanitation 2215 141.48 1147.93 1053.88 1811.00
çęĭĝ Housing 2216 3561.52 8269.32 8230.22 10835.16
ĚĞēıĮęøĭĝ Urban Development 2217 786.32 1684.25 1061.54 1379.86
ŮĝĭēĆ Broadcasting 2221 3100.14 3247.36 3067.26 3218.56
æċĲĝĳĮýćÿĭĮć~æċĲĝĳĮýćÿċÿĭĮć~æɊ Welfare of Scheduled Castes, 2225 2745.87 3786.59 3610.93 5343.73
ĮčþģĸęúŘõēæʙĝŃƥøļŃøĭ Scheduled Tribes, Other
Backward Classes and Minorities
øʞĭĆ
ŵđ~ēļÿúĭēõēøĽĚĕĮęøĭĝ Labour, Employment and Skill 2230 11535.13 11752.90 11674.55 12427.93
Development
4
Head 2018-2019 2019-2020 2019-2020 2020-2021
čļĜĭĞĭē Nutrition 2236 13.15 14.18 15.70 15.32
ŮĭøĴĮćøçčĉĭēĭĞć Relief on account of Natural 2245 10943.05 11096.89 21091.39 26126.62
Calamities
æɊĝĭđĭĮÿøĝĸęĭðŃ Other Social Services 2250 81.99 0.49 21.07 0.64
ĝĮýęĭĕĒ§ĝĭđĭĮÿøĝĸęĭðŃ Secretariat-Social Services 2251 752.09 1069.00 1035.88 1090.38
ú çĮĈŊøĝĸęĭðŃ C. ECONOMIC SERVICES 664814.39 910852.33 801563.63 876720.32
ø øĴĮĜćĈĭĝŃďȠúĮćĮęĮĊĒĭŃ (a) Agriculture and Allied Activities 176677.96 333969.71 235015.42 265418.35
øĴĮĜøĭĒŊ Crop Husbandry 2401 46178.39 113763.30 92169.62 110865.07
đĴĉĭõēÿĕĝŃēƗĆ Soil and Water Conservation 2402 25.40 28.70 27.71 30.34
ĄĸĒēıĮęøĭĝ Dairy Development 2404 1247.32 1073.74 966.90 769.50
čĽĊēļčĆ Plantations 2407 599.84 526.40 697.04 681.74
ùĭȨĐŃĄĭēĆõēĐĭǷĭúĭēĆ Food Storage and Warehousing 2408 107319.35 191835.99 114823.69 122027.90
øĴĮĜæċĲĝŃĊĭċõēĮĚƗĭ Agricultural Research and 2415 7537.61 7584.37 7376.74 7820.10
Education
øĴĮĜĮęȅıĒĝŃ̾Ĉĭċ Agricultural Financial Institutions 2416 11268.13 16421.91 16285.94 19213.20
ĝĞøĭįēćĭ Co-operation 2425 137.79 126.50 126.30 365.50
ù ŤĭđıĆĮęøĭĝ (b) Rural Development 63928.50 63353.89 74114.86 64223.40
ŤĭđıĆĮęøĭĝøĸĮĕðĮęĚĸĜøĭĒŊŢđ Special Programmes for Rural 2501 1322.58 2560.40 2556.81 1901.29
Development
ŤĭđıĆēļÿúĭē Rural Employment 2505 61815.09 60000.00 71001.81 61500.00
ĐĳĝĲĊĭē Land Reforms 2506 68.10 135.00 45.00 214.79
æɊŤĭđıĆĮęøĭĝøĭĒŊŢđ Other Rural Development 2515 722.73 658.49 511.24 607.32
Programmes
ú ĮęĚĸĜƗĸũøĭĒŊŢđ (c) Special Areas Programmes 4163.98 54129.39 48760.15 54895.43
čĳęŖȅēƗĸũ North Eastern Areas 2552 214.48 50169.39 44800.15 50935.43
ĝĭŃĝĉ̾ĈĭċıĒƗĸũĮęøĭĝĒļÿċĭ MPs Local Area Development 2553 3949.50 3960.00 3960.00 3960.00
Scheme
û ĮĝŃýĭéćĈĭďĭĤĮċĒŃũĆ (d) Irrigation and Flood Control 2678.54 3323.15 3281.53 4248.21
ďĭĤĮċĒŃũĆõēÿĕĮċøĭĝıŮĆĭĕı Flood Control and Drainage 2711 208.75 156.19 134.13 39.78
ü ëÿĭŊ (e) Energy 47886.41 61037.26 60718.46 64539.39
ĮęĉŀĒĲć Power 2801 17152.06 16400.57 16488.36 17227.39
øļĒĕĭõēĮĕưĭèĂ Coal and Lignite 2803 663.64 1001.19 797.70 752.07
ċęıċćĈĭċęıøēĆıĒëÿĭŊ New and Renewable Energy 2810 4169.63 4653.45 3405.40 5089.50
ý êȨļúćĈĭùĮċÿ (f) Industry and Minerals 76055.96 78695.72 78741.86 72865.56
êȨļú Industries 2852 62673.41 66732.15 66236.94 59971.32
êȨļúõēùĮċÿļŃčēæɊčįēʩĒ Other Outlays on Industries and 2885 4314.91 2514.08 3142.12 2949.47
Minerals
þ čįēęĞċ (g) Transport 214548.73 229442.33 217654.75 237556.68
ĐĭēćıĒēĸĕęĸ§ċıĮćĮċđĭŊĆ~ĮĉĚĭ§ĮċĉőĚ~ Indian Railways - Policy 3001 1953.20 2400.00 2500.00 2700.00
æċĲĝŃĊĭċðęŃæɊĮęĮęĊĝŃúăċ Formulation, Direction, Research
and Other Miscelllaneous
Organisations
ĐĭēćıĒēĸĕęĸ§ęĭĮĆİǛøĕĭèċ§øĭĒŊĚıĕ Indian Railways - Commercial 3002 182840.30 203415.00 197859.90 214497.37
ʩĒ Lines - Working Expenses
ĐĭēćıĒēĸĕęĸ§ĝĭđįēøĕĭèċ§øĭĒŊĚıĕ Indian Railways - Strategic Lines - 3003 1940.00 2085.00 2098.10 2215.63
ʩĒ Working Expenses
ēĸĕęĸæĮĊĚĸĜĝĸĮęĮċĒļú Appropriation from Railway Surplus 3006 3773.86 9035.00 3811.00 6500.00
ďŃĉēúĭĞõēŮøĭĚˑŃĐ Ports and Light Houses 3051 773.26 817.98 728.02 941.00
ċĽęĞċ Shipping 3052 124.22 103.30 94.69 134.70
ĝģøčįēęĞċ Road Transport 3055 158.37 265.00 265.00 359.00
æŃćĉőĚıĒÿĕčįēęĞċ Inland Water Transport 3056 870.64 670.36 483.78 628.30
æɊčįēęĞċĝĸęĭðŃ Other Transport Services 3075 2139.95 2241.52 2165.72 2239.18
ÿ ĝŃýĭē (h) Communications 34206.86 38265.87 35145.63 58325.40
ĄĭøĝĸęĭðŃ Postal Services 3201 27173.07 29525.76 30844.01 33063.92
Ā ĮęǒĭċŮĽȨļĮúøıćĈĭčĒĭŊęēĆ (i) Science Technology and 26914.88 28806.25 28148.00 30515.86
Environment
5
Head 2018-2019 2019-2020 2019-2020 2020-2021
æŃćįēƗæċĲĝŃĊĭċ Space Research 3402 5602.77 5839.72 5821.72 5668.03
ĝđĲūĮęǒĭċæċĲĝŃĊĭċ Oceanographic Research 3403 690.39 703.00 664.08 812.80
æɊęĹǒĭĮċøæċĲĝŃĊĭċ Other Scientific Research 3425 11795.43 12795.19 12517.05 14180.36
čĭįēİ̾ĈĮćøıõēčĒĭŊęēĆ Ecology and Environment 3435 3110.75 3204.20 2642.35 2880.89
ā ĝĭđĭɊçĮĈŊøĝĸęĭðŃ (j) General Economic Services 17752.57 19828.76 19982.97 24132.04
ĝĮýęĭĕĒ§çĮĈŊøĝĸęĭðŃ Secretariat-Economic Services 3451 4233.87 4080.99 4234.83 4457.23
čĒŊĂċ Tourism 3452 2082.38 1972.12 1277.76 2251.82
ĮęĉĸĚıʩĭčĭēõēĮċĒĭŊćĝŃęȠŊċ Foreign Trade and Export 3453 4872.57 4857.92 5313.93 4555.58
Promotion
ÿċúĆċĭĝęőƗĆõēĝĭŃİƥøı Census Surveys and Statistics 3454 1544.71 2934.64 3007.42 6658.72
đĽĝđĮęǒĭċ Meteorology 3455 814.44 914.26 912.76 943.00
ċĭúįēøçčĳĮćŊ Civil Supplies 3456 1628.94 1908.00 1739.47 1922.25
ĝĭđĭɊĮęȅıĒõēʩĭčĭįēøĝŃ̾Ĉĭċ General Financial and Trading 3465 514.98 518.02 518.01 618.01
Institutions
æŃćēĭŊʼŌıĒĮęȅıĒĝŃ̾ĈĭðŃ International Financial Institutions 3466 525.47 484.42 494.28 76.34
û ĝĞĭĒćĭæċĲĉĭċćĈĭæŃĚĉĭċ D. GRANTS-IN-AID AND 382711.81 475566.59 483029.56 569534.17
CONTRIBUTIONS
æɊĉĸĚļŃøĸĝĭĈćøċıøıõēçĮĈŊø Technical and Economic Co- 3605 6714.52 8227.34 7877.77 7488.50
ĝĞĒļú operation with Other Countries
ĝĞĭĒćĭĝĭđŤıõēêčˋē Aid Materials and Equipment 3606 ... ... ... ...
ēĭǛĝēøĭēļŃøļĝĞĭĒćĭæċĲĉĭċ Grants-in-aid to State Governments 3601 368172.37 457611.04 446958.04 514788.02
ĝŃûēĭǛƗĸũøıĝēøĭēļŃøļĝĞĭĒćĭ Grants-in-aid to Union Territory 3602 7824.92 9728.21 28193.75 47257.65
æċĲĉĭċ Governments
ĮęĊĭċđŃĄĕēĮĞćĝŃûēĭǛƗĸũļŃøĭ Disbursements of Union Territories 10084.72 10696.51 10911.91 13751.02
ĝŃĮęćēĆ without Legislature
ÿĻģ§ēĭÿˢĝŃĮęćēĆ TOTAL- REVENUE 2261570.81 2733541.11 2653764.72 2940739.08
DISBURSEMENTS
6
ĮęęēĆI - ĐĭēćøĭĝđĸĮøćĮċĮĊ§čĳŃÿıùĭćĭ§ŮĭİɑĒĭŃ
STATEMENT I - CONSOLIDATED FUND OF INDIA - CAPITAL ACCOUNT - RECEIPTS
Head 2018-2019 2019-2020 2019-2020 2020-2021
øĕļøìĆ A. PUBLIC DEBT
øĸȾĝēøĭēøĭçȶįēøìĆ Internal Debt of Central Government 6001
ĕûĲďýćļŃĝĸĝŃďŃĮĊćŮĮćĐĳĮćĒĭŃ Securities against Small Savings 138533.00 152268.32 262413.32 281294.13
ďĭÿĭēìĆ Market Loans 571000.00 710000.00 710000.00 780000.00
ŮĮćĐĳĮćĒļŃøĭæŃćēĆ Switching of Securities 28591.26 50000.00 165000.00 270000.00
¬¯ĮĉęĝıĒēĭÿøļĜıĒŠŃĮĄĒĭŃ 14 Days Treasury Bills 3570681.38 3960409.22 3500912.48 3851003.73
´¬ĮĉęĝıĒēĭÿøļĜıĒŠŃĮĄĒĭŃ 91 Days Treasury Bills 660165.24 545344.72 677958.25 662435.37
¬³ĮĉęĝıĒēĭÿøļĜıĒŠŃĮĄĒĭŃ 182 Days Treasury Bills 258020.06 312168.86 295036.50 322175.12
®±¯ĮĉęĝıĒēĭÿøļĜıĒŠŃĮĄĒĭŃ 364 Days Treasury Bills 208896.00 192344.66 193309.50 206494.10
ċøĉŮďŃĊċĮďĕ Cash Management Bills 190000.00 100000.00 240000.00 250000.00
æĈŖčĭĒæĮŤđ Ways & Means Advances 955243.00 500000.00 1000000.00 1000000.00
ðİƂđďœøøļĮęĚĸĜŮĮćĐĳĮćÿĭēı Issuance of Special Securities to 4500.00 550.00 550.00 ...
øēċĭ EXIM Bank
Issuance of Special Securities to ... ... 4557.00 ...
IDBI Bank Ltd.
Issuance of Special Securities to ... ... 5300.00 10000.00
IIFCL
ĝĭęŊÿĮċøƗĸũøĸďœøļŃøļĮęĚĸĜŮĮćĐĳĮć Issuance of Special Securities to 106000.00 70000.00 65443.00 0.01
ÿĭēıøēċĭ Public Sector Banks
æɊ Others 16243.02 32857.73 14354.17 16575.69
ÿļģ§øĸȾĝēøĭēøĭçȶįēøìĆ Total-Internal Debt of Central 6707872.96 6625943.51 7134834.22 7649978.15
Government
ĮęĉĸĚıìĆ External Debt 6002 50609.44 44673.00 57016.00 57557.00
ÿļģ§ĕļøìĆ TOTAL - PUBLIC DEBT 6758482.40 6670616.51 7191850.22 7707535.15
ùìĆļŃćĈĭæĮŤđļŃøıęĝĳĕı B. RECOVERIES OF LOANS AND
ADVANCES
ēĭǛĝēøĭēŐ State Governments 14366.77 11614.81 14075.04 12399.34
ĝŃûēĭǛƗĸũĮęĊĭċđŃĄĕĝĮĞć Union Territories (With Legislature) 72.00 442.69 100.05 100.00
ĮęĉĸĚıĝēøĭēŐ Foreign Governments 369.77 145.17 56.00 46.00
æɊìĆćĈĭæĈŖčĭĒæĮŤđ Other Loans & Advances (Public 15448.40 54000.06 40048.40 53796.34
ĝĭęŊÿĮċøƗĸũıĒêȯđ~ĝĭŃĮęĮĊø Sector Enterprises, Statutory
Bodies etc.)
ĮċøĭĒçĮĉ
ÿļģ§ìĆļŃćĈĭæĮŤđļŃøıęĝĳĕı TOTAL - RECOVERIES OF LOANS 30256.94 66202.73 54279.49 66341.68
AND ADVANCES
úĮęĮęĊčĳŃÿıŮĭİɑĒĭŃ C. MISCELLANEOUS CAPITAL 94979.05 105000.00 65044.96 210000.00
RECEIPTS
ÿļģ§čĳŃÿıĕĸùĭŮĭİɑĒĭŃ TOTAL CAPITAL ACCOUNT 6883718.39 6841819.24 7311174.67 7983876.83
RECEIPTS
ēĭÿˢŮĭİɑĒĭŃ REVENUE RECEIPTS 1806462.91 2248038.02 2153426.77 2331444.66
čĴʿĝĸæŤĭċĒċ (brought forward from page 2) ... ... ... ...
ÿļģ§ĐĭēćøĭĝđĸĮøćĮċĮĊ§ĝŃĮęćēĆ TOTAL-CONSOLIDATED FUND OF 8690181.30 9089857.26 9464601.44 10315321.49
INDIA RECEIPTS



ADMIN1: ADMIN2:
7
ĮęęēĆI - ĐĭēćøĭĝđĸĮøćĮċĮĊ§čĳŃÿıùĭćĭ§ĝŃĮęćēĆ
STATEMENT I - CONSOLIDATED FUND OF INDIA - CAPITAL ACCOUNT - DISBURSEMENTS
Head 2018-2019 2019-2020 2019-2020 2020-2021
øĝĭđĭɊĝĸęĭôŃøĭčĳŃÿıĕĸùĭ A. CAPITAL ACCOUNT OF 112921.39 117954.10 123751.74 127902.59
GENERAL SERVICES
đĲūĭ~ĮĝſĭĮċđĭŊĆõēĂøĝĭĕ Currency, Coinage and Mint 4046 186.27 ... ... ...
čĲĮĕĝ Police 4055 9561.07 10100.16 9071.72 9268.12
ĕĸùċĝĭđŤıõēþčĭé Stationery and Printing 4058 ... 46.16 0.01 100.00
ĮęĮęĊĝĭđĭɊĝĸęĭðŃ Miscellaneous General Services 4075 -9.68 0.97 0.62 0.62
ēƗĭĝĸęĭðŃ Defence Services 4076 95230.59 103394.31 110394.31 113734.00
ùĝĭđĭĮÿøĝĸęĭôŃøĭčĳŃÿıĕĸùĭ B. CAPITAL ACCOUNT OF SOCIAL 9148.85 9686.91 9598.65 8824.43
SERVICES
ĮĚƗĭ~ùĸĕ~øĕĭõēĝŃˋĴĮć Education, Sports, Art and Culture 4202 2358.00 2219.15 2200.14 2325.30
çęĭĝ Housing 4216 1094.72 1006.68 953.97 1030.78
ĚĞēıĮęøĭĝ Urban Development 4217 2441.00 3815.00 3713.06 3416.00
æċĲĝĳĮýćÿĭĮć~æċĲĝĳĮýćÿċÿĭĮć~ Welfare of Scheduled Castes, 4225 507.44 625.12 685.13 840.12
æɊĮčþģĸęúŘõēæʙĝŃ˳øļŃ Scheduled Tribes , Other
Backward Classes and
øĭøʞĭĆ
Minorities
æɊĝĭđĭĮÿøĝĸęĭðŃ other Social Services 4250 330.48 283.32 258.19 192.46
úçĮĈŊøĝĸęĭôŃøĭčĳŃÿıĕĸùĭ C. CAPITAL ACCOUNT OF 275851.86 252102.66 263606.15 249058.53
ECONOMIC SERVICES
øøĴĮĜćĈĭĝŃďȠúĮćĮęĮĊĒļŃøĭčĳŃÿı (a) Capital Account of Agriculture 2709.90 2867.16 3292.92 2377.77
ĕĸùĭ and allied activities
ĎĝĕøĭĒŊ Crop Husbandry 4401 9.81 29.71 28.86 49.32
ĄĸēıĮęøĭĝ Dairy Development 4404 ... 23.76 5.00 34.53
ùĭȨĐŃĄĭēĆõēĐĭǷĭúĭēĆ Food Storage and Warehousing 4408 568.28 1011.12 1010.92 1022.02
øĴĮĜĮęȅıĒĝŃ̾ĈĭċļŃđŐĮċęĸĚ Investments in Agricultural 4416 2108.00 1735.00 2205.00 1200.01
Financial Institutions
ùĮęĚĸĜƗĸũøĭĒŊŢđļŃøĭčĳŃÿıĕĸùĭ (b) Capital Account of Special 91.51 9110.51 8484.04 9086.68
Areas Programmes
čĳęŖȅēƗĸũ North Eastern Areas 4552 91.51 9110.51 8484.04 9086.68
úĮĝŃýĭéćĈĭďĭĤĮċĒŃũĆøĭčĳŃÿı (c) Capital account of Irrigation and 267.23 314.27 267.18 331.27
ĕĸùĭ Flood Control
ďĭĤĮċĒŃũĆčįēĒļÿċĭðŃ Flood Control Projects 4711 17.53 28.40 19.80 25.82
ûëÿĭŊøĭčĳŃÿıĕĸùĭ (d) Capital Account of Energy 3817.32 2535.16 1443.90 1666.11
ĮęĉŀĒĲćčįēĒļÿċĭðŃ Power Projects 4801 1641.61 864.90 795.90 707.11
ċęıċćĈĭċęıøēĆıĒëÿĭŊ New and Renewable Energy 4810 17.39 45.00 71.00 52.00
üêȨļúćĈĭùĮċÿļŃøĭčĳŃÿıĕĸùĭ (e) Capital Account of Industry and 8526.00 6458.64 12117.00 16772.10
Minerals
æĮĐĒĭŃĮũøêȨļú Engineering Industries 4858 ... 0.05 ... 0.05
ĉĳēĝŃýĭēõēęĹĉŀĒĲćêȨļú Telecommunication and Electronic 4859 176.32 274.65 194.65 249.80
Industries
êčĐļƅĭêȨļú Consumer Industries 4860 49.54 253.32 181.05 142.24
čēđĭĆĲëÿĭŊêȨļú Atomic Energy Industries 4861 2400.75 2964.14 3010.51 3249.52
êȨļúļŃõēùĮċÿ Other Industries and Minerals 4885 5100.00 2200.00 7500.00 11500.00
ýčįēęĞċčĳŃÿıĕĸùĭ (f) Capital Account of Transport 126787.65 134283.06 136378.33 147430.13
ĐĭēćıĒēĸĕęĸęĭĮĆǛõēĝĭđįēø Indian Railways - Commercial 5002 52102.61 65763.64 67766.74 69905.74
ĕĭèċŐ°««õē°««® Lines
ĐĭēćıĒēĸĕęĸĝıđĭęćŎĕĭèċ Indian Railways - Strategic Lines 5003 735.06 73.36 70.26 94.26
ďŃĉēúĭĞõēŮøĭĚúĴĞ Ports and Light Houses 5051 177.77 254.87 242.60 75.00
čļćčįēęĞċ Shipping 5052 -22.52 13.70 10.82 12.00
ĝģøčįēęĞċ Road Transport 5055 8.00 15.00 8.00 20.00
æɊčįēęĞċĝĸęĭðŃ Other Transport Services 5075 50.00 75.00 50.10 52.45
8
Head 2018-2019 2019-2020 2019-2020 2020-2021
þĝŃýĭēčĳŃÿıĕĸùĭ (g) Capital Account of 2570.50 4964.25 4706.72 25899.39
Communications
ĄĭøĝĸęĭðŃ Postal Services 5201 511.27 554.53 368.83 829.33
ÿĮęǒĭċŮĽȨļĮúøıćĈĭčĒĭŊęēĆøĭ (h) Capital Account of Science 7294.96 8690.04 9318.29 10199.05
čĳŃÿıĕĸùĭ Technology and Environment
æŃćįēƗæċĲĝŃĊĭċ Space Research 5402 5532.64 6598.54 7264.54 7775.27
ĝđĲūĮęǒĭċæċĲĝŃĊĭċ Oceanographic Research 5403 13.16 18.00 13.00 17.00
æɊęĹǒĭĮċøõēčĒĭŊęēĆæċĲĝŃĊĭċ Other Scientific and 5425 105.93 134.50 86.07 227.90
Environmental Research
ĀĝĭđĭɊçĮĈŊøĝĸęĭôŃøĭčĳŃÿı (i) Capital Account of General 123786.79 82879.57 87597.77 35296.03
ĕĸùĭ Economic Services
ĮęĉĸĚıʩĭčĭēõēĮċĒĭŊćĝŃęĊŊċ Foreign Trade and Export 5453 -5.03 ... ... ...
Promotion
đĽĝđĮęǒĭċ Meteorology 5455 71.24 123.00 105.00 155.00
ĝĭđĭɊĮęȅıĒõēʩĭčĭįēøĝŃ̾ĈĭċļŃ Investments in General Financial 5465 109466.29 72832.04 77680.00 8320.06
đŐĮċęĸĚ and Trading Institutions
æŃćēĭŊʼŌıĒĮęȅıĒĝŃ̾ĈĭċļŃđŐĮċęĸĚ Investments in International 5466 13971.16 5599.19 6525.00 4373.25
Financial Institutions
ĮęĊĭċđŃĄĕēĮĞćĝŃûēĭǛƗĸũļŃøĭ Disbursements of Union Territories 1600.64 1688.33 1475.16 5536.47
ĝŃĮęćēĆ without Legislature
ÿļģ§ēĭÿˢùĭćĸøĸďĭĞēøĭčĳŁÿı TOTAL - CAPITAL EXPENDITURE 399522.74 381432.00 398431.70 391322.02
ʩĒ OUTSIDE THE REVENUE
ACCOUNT
øĕļøìĆ PUBLIC DEBT
øĸȾĝēøĭēøĭçȶįēøìĆ Internal Debt of Central 6001
Government
ďĭÿĭēìĆ Market Loans 148265.40 236877.99 236027.99 239130.38
ƗĮćčĳĮćŊĒĭŃõēæɊďĭŃĄŀĝ Compensation and Other Bonds 578.44 1837.55 485.59 426.47
ðċðĝðĝðĎøļÿĭēıøıúé Redemption of Securities issued 13533.05 22268.32 22413.32 41294.13
ŮĮćĐĳĮćĒļŃøĭđļýċ to NSSF
ˢĆŊđĽĮūøēĆĒļÿċĭ Gold Monetization Secheme ... ... 10.00 60.00
ĝļęēĸċúļ̵ĄďļŃĄĒļÿċĭ Sovereign Gold Bond Scheme ... ... ... 5.00
ďĭéďĹøˢıĮýŃú Buyback / Switching 28058.99 100000.00 165000.00 300000.00
¬¯ĮĉęĝıĒēĭÿøļĜıĒŠŃĮĄĒĭŃ 14 days Treasury Bills 3599384.28 3960409.22 3500912.48 3851003.73
´¬ĮĉęĝıĒēĭÿøļĜıĒŠŃĮĄĒĭŃ 91 days Treasury Bills 706707.70 524343.22 649072.75 659275.84
¬³ĮĉęĝıĒēĭÿøļĜıĒŠŃĮĄĒĭŃ 182 days Treasury Bills 225089.11 310119.02 283335.50 308519.25
®±¯ĮĉęĝıĒēĭÿøļĜıĒŠŃĮĄĒĭŃ 364 days Treasury Bills 159685.00 190396.00 208896.00 198309.50
ċúĉŮďŃĊċŠŃĮĄĒĭŃ Cash Management Bills 190000.00 100000.00 240000.00 250000.00
æĈŖčĭĒæĮŤđ Ways and Means Advances 955243.00 500000.00 1000000.00 1000000.00
æŃćēĭŊʼŌıĒĮęȅıĒĝŃ̾ĈĭôŃøļÿĭēı Rdemption of securities issued to 7661.64 1572.77 6125.37 5509.26
ŮĮćĐĳĮćĒļŃøĭđļýċ International Financial
Institutions
ÿĻģ§øĸȾĝēøĭēøĭçȶįēøìĆ Total-Internal Debt of Central 6034206.61 5947824.09 6312279.00 6853533.56
Government
ĮęĉĸĚıìĆ External Debt 6002 30738.77 35363.00 34110.00 37388.00
ÿĻģ§øĕļøìĆ TOTAL - PUBLIC DEBT 6064945.38 5983187.09 6346389.00 6890921.56
ìĆćĈĭæĮŤđ LOANS AND ADVANCES
øĝĭđĭĮÿøĝĸęĭôŃĞĸćĲìĆ A. LOANS FOR SOCIAL SERVICES 11923.60 14598.93 14448.93 16355.00
ĚĞēıĮęøĭĝøĸĮĕðìĆ Loans for Urban Development 6217 11923.60 14598.93 14448.93 16355.00
ùçĮĈŊøĝĸęĭôŃĞĸćĲìĆ B. LOANS FOR ECONOMIC 18130.77 55638.51 41861.89 55994.02
SERVICES
øøĴĮĜćĈĭĝŃďȠúĮćĮęĮĊĒļŃĞĸćĲìĆ (a) Loans for Agriculture and allied 12000.00 50052.03 36047.38 50048.70
activities
ùĭȨĐŃĄĭēĆõēĐĭȵĭúĭēĆøĸĮĕð Loans for Food, Storage and 6408 12000.00 50000.00 36000.00 50000.00
ìĆ Warehousing
øĴĮĜĮęȅıĒĝŃ̾ĈĭċļŃøĸĮĕðìĆ Loans to Agricultural Financial 6416 ... 52.03 47.38 48.70
Institutions
úĮęĚĸĜƗĸũøĭĒŊŢđļŃĞĸćĲìĆ (b) Loans for Special Area ... 90.00 90.00 90.00
Programme
čĳęŖȅēƗĸũļŃøĸĮĕðìĆ Loans for North Eastern Areas 6552 ... 90.00 90.00 90.00
üëÿĭŊøĸĮĕðìĆ (c) Loans for Energy 5099.21 4006.69 3916.69 4201.27
ĮęĉŀĒĲćčįēĒļÿċĭôŃøĸĮĕðìĆ Loans for Power Projects 6801 5099.21 3964.64 3874.64 4201.27
čĸĂŌļĮĕĒđøĸĮĕðìĆ Loans for Petroleum 6802 ... 42.05 42.05 ...
ýêȨļúćĈĭùĮċÿļŃĞĸćĲìĆ (d) Loans for Industry and Minerals 974.99 445.05 766.08 609.31
ŤĭđõēĕûĲêȨļúøĸĮĕðìĆ Loans for Village and Small 6851 2.57 6.52 6.30 4.70
Industries
ĝıđŐĂõēæĊĭİȕøùĮċÿêȨļúļŃøĸ Loans for Cement and Non- 6854 6.33 0.01 ... 0.01
ĮĕðìĆ Metallic Mineral Industries
êęŊēøêȨļúļŃøĸĮĕðìĆ Loans for Fertilizer Industries 6855 ... 0.05 0.05 0.05
9
Head 2018-2019 2019-2020 2019-2020 2020-2021
ēĝĭĒċõēĐĸĜÿêȨļúļŃøĸĮĕðìĆ Loans for Chemical and 6857 10.95 5.06 333.18 7.18
Pharmaceutical Industries
æĮĐĒĭŃĮũøêȨļúļŃøĸĮĕðìĆ Loans for Engineering Industries 6858 577.00 132.83 132.76 353.99
êčĐļƅĭêȨļúļŃøĸĮĕðìĆ Loans for Consumer Industries 6860 284.95 270.57 233.79 213.37
êȨļúõēùĮċÿļŃøļæɊìĆ Other Loans to Industries and 6885 93.19 30.01 60.00 30.01
Minerals
ĀĮęǒĭċŮĽȨļĮúøıćĈĭčĒĭŊęēĆøĸ (f) Loans for Science Technology 0.33 4.00 1.00 4.00
ĮĕðìĆ and Environment
æɊęĹǒĭĮċøæċĲĝŃĊĭċøĸĮĕðìĆ Loans for Other Scientific 7425 0.33 4.00 1.00 4.00
Research
āĝĭđĭɊçĮĈŊøĝĸęĭôŃĞĸćĲìĆ (g) Loans for General Economic 56.24 1040.74 1040.74 1040.74
Services
ĝĭđĭɊĮęȅıĒõēʩĭčĭįēøĝŃ̾ĈĭċļŃ Loans to General Financial and 7465 20.68 40.74 40.74 40.74
øĸĮĕðìĆ Trading Institutions
æŃćēĭŊʼŌıĒĮęȅıĒĝŃ̾ĈĭċļŃøĸĮĕðìĆ Loans to International Financial 7466 35.56 ... ... ...
Institutions
æɊĝĭđĭɊçĮĈŊøĝĸęĭôŃøĸĮĕð Loans for Other General 7475 ... 1000.00 1000.00 1000.00
ìĆ Economic Services
úæɊìĆ C. OTHER LOANS 24612.78 21186.18 26367.77 26336.16
ēĭǛĝēøĭēļŃøļìĆõēæĮŤđ Loans and Advances to State 7601 23828.76 19842.24 25113.87 25102.66
Governments
ĝŃûēĭǛƗĸũøıĝēøĭēļŃøļìĆõē Loans and Advances to Union 7602 129.61 300.01 225.01 150.01
æĮŤđ Territory Governments
ĮęĉĸĚıĝēøĭēļŃøļæĮŤđ Advances to Foreign 7605 494.62 842.00 802.68 832.28
Governments
ĝēøĭēıøđŊýĭįēĒļŃçĮĉøļìĆ Loans to Government Servants, 7610 158.64 200.00 225.00 250.00
etc.
ĮęĮęĊìĆ Miscellaneous Loans 7615 1.15 1.93 1.21 1.21
ĮęĊĭċđŃĄĕēĮĞćĝŃûēĭ̕ĒƗĸũļŃøĭ Loans and Advances for Union 0.31 0.55 0.55 0.10
ìĆ Territories without Legislature
ìĆćĈĭçĮŤđ TOTAL - LOANS AND ADVANCES 54667.46 91424.17 82679.14 98685.28
ÿļģ§čĳŃÿıʩĒ TOTAL - CAPITAL EXPENDITURE 6519135.58 6456043.26 6827499.84 7380928.86
ÿļģ§ĐĭēćøĭĝđĸĮøć TOTAL - CONSOLIDATED FUND 8780706.39 9189584.37 9481264.56 10321667.94
ĮċĮĊ§ĝŃĮęćēĆ OF INDIA DISBURSEMENTS
10
ĮęęēĆI ø§ĐĭēćøıĝđĸĮøćĮċĮĊčēĝŃĮęćēĆĐĭįēć
STATEMENT IA - DISBURSEMENTS 'CHARGED' ON THE CONSOLIDATED FUND OF INDIA
đĲƥĚıĜŊ ďÿĂæċĲđĭċ ĝŃĚļĮĊćæċĲđĭċ ďÿĂæċĲđĭċ
Major Budget Estimates Revised Estimates Budget Estimates
Head 2019-2020 2019-2020 2020-2021
ĝŃĝĉēĭǛĝŃûēĭǛƗĸũļŃøĸ Parliament/State/Union Territory 2011 2.82 2.53 2.67
ĮęĊĭċđŃĄĕ Legislatures
ēĭʼŌčĮćêčēĭʼŌčĮćēĭǛčĭĕĝŃû President, Vice President/Governor, 2012 76.35 74.42 80.98
ēĭǛƗĸũļŃøĸŮĚĭĝø Administrator of Union Territories
ɊĭĒŮĚĭĝċ Administration of Justice 2014 307.38 334.47 346.18
ĕĸùĭčēıƗĭ Audit 2016 177.69 177.69 186.46
ĝıđĭĚĲʋ Customs 2037 0.30 0.32 0.30
øŐūıĒęˑĲõēĝĸęĭøēðęŃ Collection Charges under Central 2042 0.20 0.20 0.20
ðøıøĴćęˑĲõēĝĸęĭøēøĸ Goods and Services Tax and
Integrated Goods and Services Tax
æŃćúŊćĝŃŤĞĆŮĐĭē
ìĆøıøĂĽćıĒĭčįēęÿŊċøĸ Appropriation for Reduction or 2048 2000.00 4677.53 5000.00
ĮĕðĮęĮċĒļú Avoidance of Debt
ɯĭÿĐĲúćĭċ Interest Payments 2049 671470.60 658619.65 728203.16
ĕļøĝĸęĭçĒļú Public Service Commission 2051 298.45 298.16 305.38
ĝĮýęĭĕĒ§ĝĭđĭɊĝĸęĭðŃ Secretariat-General Services 2052 0.35 0.39 0.34
čĲĮĕĝ Police 2055 8.64 8.32 7.84
ĕļøĮċđĭŊĆøĭĒŊ Public Works 2059 13.30 13.00 12.30
ĮęĉĸĚıđĭđĕĸ External Affairs 2061 0.02 0.02 0.02
ĝćøŊćĭ Vigilance 2062 131.84 54.66 111.70
čŐĚċõēæɊĝĸęĭĮċęĴĮȅĕĭĐ Pensions and other Retirement 2071 382.36 390.70 480.20
Benefits
ēƗĭĝĸęĭðŃ§Ĉĕĝĸċĭ Defence Services - Army 2076 76.56 75.76 76.26
ēƗĭĝĸęĭðŃ§ċĽĝĸċĭ Defence Services - Navy 2077 13.24 12.50 13.10
ēƗĭĝĸęĭðŃ§ęĭĒĲĝĸċĭ Defence Services - Air Force 2078 7.31 9.65 5.85
ēƗĭĝĸęĭðŃ§çĒĲĊøĭēùĭċĸ Defence Services - Ordnance 2079 5.18 5.18 5.18
Factories
ēƗĭĝĸęĭðŃ§æċĲĝŃĊĭċõēĮęøĭĝ Defence Services - Research and 2080 0.63 2.16 0.63
Development
çęĭĝ Housing 2216 78.51 87.20 91.51
ĝĭđĭĮÿøĝĲēƗĭõēøʞĭĆ Social Security and Welfare 2235 0.22 0.22 0.17
ŮĭøĴĮćøçčĉĭēĭĞć Relief on account of Natural 2245 ... ... 0.01
Calamities
ĐĭēćıĒēĸĕęĸ§ċıĮćĮċđĭŊĆ~ Indian Railways - Policy Formulation, 3001 3.28 4.45 4.00
ĮĉĚĭ§ĮċĉőĚ~æċĲĝŃĊĭċðęŃ Direction, Research and Other
Miscelllaneous Organisations
æɊĮęĮęĊĝŃúăċ
ĐĭēćıĒēĸĕęĸ§ęĭĮĆİǛø Indian Railways - Commercial Lines - 3002 468.00 394.00 491.00
ĕĭèċ§øĭĒŊĚıĕʩĒ Working Expenses
ĐĭēćıĒēĸĕęĸ§ĝĭđįēø Indian Railways - Strategic Lines - 3003 3.00 3.00 2.00
ĕĭèċ§øĭĒŊĚıĕʩĒ Working Expenses
ĝģøčįēęĞċ Road Transport 3055 4.00 4.00 3.10
ĄĭøĝĸęĭðŃ Postal Services 3201 0.80 0.80 0.80
æŃćįēƗæċĲĝŃĊĭċ Space Research 3402 0.60 0.60 0.60
æɊęĹǒĭĮċøæċĲĝŃĊĭċ Other Scientific Research 3425 0.02 0.02 0.02
ĝĮýęĭĕĒ§çĮĈŊøĝĸęĭðŃ Secretariat-Economic Services 3451 1.01 1.50 1.50
ċĭúįēøçčĳĮćŊ Civil Supplies 3456 ... 0.01 ...
ēĭǛĝēøĭēļŃøļĝĞĭĒćĭæċĲĉĭċ Grants-in-aid to State Governments 3601 126125.46 129691.99 154641.80
ĝŃûēĭǛƗĸũøıĝēøĭēļŃøļ Grants-in-aid to Union Territory 3602 0.03 0.03 51.01
ĝĞĭĒćĭæċĲĉĭċ Governments
æɊēĭÿøļĜıĒĝĸęĭôŃčēčĳŃÿı Capital Outlay on Other Fiscal 4047 ... 5.00 ...
čįēʩĒ Services
čĲĮĕĝčēčĳŃÿıčįēʩĒ Capital Outlay on Police 4055 1.33 3.12 3.42
ĕļøĮċđĭŊĆøĭĒŖčēčĳŃÿı Capital Outlay on Public Works 4059 7.50 0.60 4.50
čįēʩĒ
ēƗĭĝĸęĭôŃčēčĳŃÿıčįēʩĒ Capital Outlay on Defence Services 4076 83.35 94.90 107.50
çęĭĝčēčĳŃÿıčįēʩĒ Capital Outlay on Housing 4216 57.12 45.32 42.32
ĚĞēıĮęøĭĝčēčĳŃÿıčįēʩĒ Capital Outlay on Urban Development 4217 25.00 85.00 55.00
čēđĭĆĲëÿĭŊêȨļúļŃčēčĳŃÿı Capital Outlay on Atomic Energy 4861 10.00 10.00 10.00
čįēʩĒ Industries
ĐĭēćıĒēĸĕęĸęĭĮĆİǛøĕĭèċčē Capital Outlay on Indian Railways - 5002 36.31 853.80 102.63
čĳŃÿıčįēʩĒ Commercial Lines
ĝģøõēčĲĕļŃčēčĳŃÿıčįēʩĒ Capital Outlay on Roads and Bridges 5054 45.00 45.00 50.00
æŃćįēƗæċĲĝŃĊĭċčēčĳŃÿıčįēʩĒ Capital Outlay on Space Research 5402 0.40 0.40 0.40
æɊęĹǒĭĮċøõēčĒĭŊęēĆ Capital Outlay on Other Scientific and 5425 ... 0.29 ...
æċĲĝŃĊĭċčēčĳŃÿıčįēʩĒ Environmental Research
øĸȾĝēøĭēøĭçȶįēøìĆ Internal Debt of Central Government 6001 5947824.09 6312279.00 6853533.56
ĮęĉĸĚıìĆ External Debt 6002 35363.00 34110.00 37388.00
ēĭǛĝēøĭēļŃøļìĆõēæĮŤđ Loans and Advances to State 7601 19842.24 25113.87 25102.66
Governments
øĲĕÿļģ GRAND TOTAL 6804953.49 7167591.43 7806526.26
11
ĮęęēĆII - Đĭēćøıçøİ˝øćĭĮċĮĊ§Įċęĕ
STATEMENT II - CONTINGENCY FUND OF INDIA - NET
Head 2018-2019 2019-2020 2019-2020 2020-2021
çøİ˝øćĭĮċĮĊ Contingency Fund 8000 ... ... ... ...
12
ĮęęēĆIII - Đĭēćøĭĕļøùĭćĭ§ŮĭİɑĒĭŃ
STATEMENT III - PUBLIC ACCOUNT OF INDIA - RECEIPTS
(àøēļģ(In àBQNQDR)
ęĭˑĮęø ďÿĂæċĲđĭċ ĝŃĚļĮĊćæċĲđĭċ ďÿĂæċĲđĭċ
Actuals Budget Revised Estimates Budget
2018-2019 Estimates 2019-2020 Estimates
2019-2020 2020-2021
øēĭʼŌıĒĕûĲďýćĮċĮĊ A. NATIONAL SMALL SAVINGS FUND 880570.28 894910.58 1067090.78 1171125.45
ùēĭǛĐĮęˈĮċĮĊõēæɊĕĸùĸ B. STATE PROVIDENT FUND AND 123751.41 137365.72 124072.59 128445.50
OTHER ACCOUNTS
(i) ēĭǛĐĮęˈĮċĮĊ (i) State Provident Fund 68350.00 77000.00 77000.00 77000.00
(ii) ĄĭøďıđĭõēÿıęċęĭĮĜŊøıĮċĮĊ (ii) Postal Insurance and Life Annuity 51414.44 56461.78 43005.21 47305.73
Fund
(iii) æɊđĉŐ (iii) Other Items 3986.97 3903.94 4067.38 4139.77
úçēĮƗćĮċĮĊĒĭŃ C. RESERVE FUNDS 321859.06 433614.09 466415.63 493947.87
øĝɯĭÿŮĭēĮƗćĮċĮĊĒĭŃ (a) Reserve Funds bearing 53039.55 55845.64 51209.10 56404.29
Interest
(i) ēĸĕęĸĮċĮĊĒĭŃ (i) Railway Funds 46430.86 55540.64 50943.10 56350.29
(ii) æɊŮĭēĮƗćĮċĮĊĒĭŃ (ii) Other Reserve Funds 6608.69 305.00 266.00 54.00
ùĮċɯĭŊÿŮĭēĮƗćĮċĮĊĒĭŃ (b) Reserve Funds not bearing 268819.51 377768.45 415206.53 437543.58
interest
(i) øŐūıĒĝģøðęŃæęĝŃēýċĭĮċĮĊ (i) Central Road and 62879.64 119098.83 122369.83 126076.17
Infrastructure Fund
(ii) ēĭʼŌıĒēĭÿđĭúŊ̾ĈĭĒıčĲĕĚĲʋ (ii) National Highway Permanent 19265.59 10610.46 10600.00 12500.00
ĮċĮĊ Bridges Fee Fund
(iii) ùĭċøʞĭĆĮċĮĊ (iii) Mines Welfare Fund ... ... ... ...
(iv) úĭēŃĂıđļýċĮċĮĊ (iv) Guarantee Redemption Fund 600.00 600.00 600.00 600.00
(v) ŮĭēŃĮĐøĮĚƗĭøļĜ (v) Prarambhic Shiksha Kosh 25227.90 28920.11 28920.11 31812.12
(vi) ĚøŊēĭĮęøĭĝĮċĮĊ (vi) Sugar Development Fund ... ... ... ...
(vii) ĮęĚĸĜēĸĕęĸĝĲēƗĭĮċĮĊõē (vii) Spl. Rly. Safety Fd and Rly. 31023.86 35000.00 34750.00 38500.00
ēĸĕęĸĝĲēƗĭĮċđĭŊĆøĭĒŊĮċĮĊ Safety Works Fund
(viii) ēĭʼŌıĒŤĭđıĆēļÿúĭēúĭēŃĂı (viii) National Rural Employment 61829.56 60000.00 71001.81 61500.00
ĮċĮĊ Guarantee Fund
(ix) ēĭʼŌıĒçčĉĭŮĮćĮŢĒĭĮċĮĊ (ix) National Disaster Response 2500.00 2480.00 2790.00 2930.00
Fund
(x) æɊŮĭēĮƗćĮċĮĊĒĭŃ (x) Other Reserve Funds 65492.96 121059.05 144174.78 163625.29
ûÿđĭõēæĮŤđ D. DEPOSITS AND AVANCES 365461.21 177163.69 187183.31 253169.93
øĝɯĭÿÿđĭēĭĮĚĒĭŃ (a) Deposits bearing interest 67606.00 14876.31 14159.88 14980.71
(i) ēĭʼŌıĒēƗĭĮċĮĊ (i) National Defence Fund 103.85 110.00 110.00 110.00
(ii) čįēęĭēčŐĚċ§ĝĞ§ÿıęċďıđĭ (ii) Family Pension-cum-Life 12784.52 9030.00 8600.00 9030.00
ĮċĮĊĒĭŃçĮĉ͡ Assurance funds etc.
(iii) æɊÿđĭēĭĮĚĒĭŃ (iii) Other Deposits 54717.63 5736.31 5449.88 5840.71
ùĮċɯĭŊÿÿđĭēĭĮĚĒĭŃ (b) Deposits not bearing interest 244566.12 162287.38 173023.43 238189.22
(i) ĮĝĮęĕÿđĭēĭĮĚĒĭŃ (i) Civil Deposits 21301.93 17000.00 19000.00 20000.00
(ii) ̾ĈĭċıĒĮċĮĊĒļŃøıÿđĭēĭĮĚĒĭŃ (ii) Deposits of Local Funds -0.01 ... ... ...
(iii) ēĭʼŌıĒĮċęĸĚĮċĮĊ (iii) National Investment Fund 78496.20 90000.00 59700.00 120000.00
(iv) æɊÿđĭēĭĮĚĒĭŃ (iv) Other Deposits 144768.00 55287.38 94323.43 98189.22
úæĮŤđ (c) Advances 53289.09 ... ... ...
ģêýŃćõēĮęĮęĊ E. SUSPENSE AND MISCELLANEOUS 46441.10 ... ... ...
êýŃćĕĸùĭĮċęĕ Suspense Account (Net) ... ... ... ...
ýĹøõēŠŃĮĄĒĭŃĮċęĕ Cheque and Bills (Net) 6585.64 ... ... ...
ĮęĐĭúıĒĚĸĜĮċęĕ Departmental Balances (Net) ... ... ... ...
ċøĉĚĸĜĮċęĸĚ Cash Balance Investment 39855.46 ... ... ...
æɊ Others ... ... ... ...
ýŮĸĜĆ F. REMITTANCES 998.61 ... ... ...
(i) đċıòĄŊē (i) Money Orders 52.14 ... ... ...
(ii) æɊĮęŮĸĜĆ (ii) Other Remittances 946.47 ... ... ...
ÿļģ§ĕļøùĭćĭŮĭİɑĒĭŃ TOTAL-PUBLIC ACCOUNT RECEIPTS 1739081.67 1643054.08 1844762.31 2046688.75
øĲĕÿļģ§(I +II +III ) GRAND TOTAL - (I+II+III) 10429262.97 10732911.34 11309363.75 12362010.24
ēļøģĚĸĜ CASH BALANCE 1407.88 -39793.06 2729.00 2732.30
ÿļģ TOTAL 10430670.85 10693118.28 11312092.75 12364742.54
13
ĮęęēĆIII - Đĭēćøĭĕļøùĭćĭ§ĝŃĮęćēĆ
STATEMENT III - PUBLIC ACCOUNT OF INDIA - DISBURSEMENTS
(àøēļģ(In àBQNQDR)
ęĭˑĮęø ďÿĂæċĲđĭċ ĝŃĚļĮĊćæċĲđĭċ ďÿĂæċĲđĭċ
Actuals Budget Revised Estimates Budget
2018-2019 Estimates 2019-2020 Estimates
2019-2020 2020-2021
øēĭʼŌıĒĕûĲďýćĮċĮĊ A. NATIONAL SMALL SAVINGS FUND 873177.39 894910.59 1103285.50 1171125.45
ùēĭǛĐĮęˈĮċĮĊõēæɊĕĸùĸ B. STATE PROVIDENT FUND AND 105705.72 101532.50 103921.86 108061.56
OTHER ACCOUNTS
(i) ēĭǛĐĮęˈĮċĮĊ (i) State Provident Fund 52290.95 59000.00 59000.00 59000.00
(ii) ĄĭøďıđĭõēÿıęċęĭĮĜŊøıĮċĮĊ (ii) Postal Insurance and Life Annuity 51757.89 40592.67 42682.04 46950.24
Fund
(iii) æɊđĉŐ (iii) Other Items 1656.88 1939.83 2239.82 2111.32
úçēĮƗćĮċĮĊĒĭŃ C. RESERVE FUNDS 340157.26 434484.99 466657.11 490969.52
øĝɯĭÿŮĭēĮƗćĮċĮĊĒĭŃ (a) Reserve Funds bearing 48582.34 56808.95 51786.95 55527.45
Interest
(i) ēĸĕęĸĮċĮĊĒĭŃ (i) Railway Funds 48495.59 56500.00 51500.00 55500.00
(ii) æɊŮĭēĮƗćĮċĮĊĒĭŃ (ii) Other Reserve Funds 86.75 308.95 286.95 27.45
ùĮċɯĭŊÿŮĭēĮƗćĮċĮĊĒĭŃ (b) Reserve Funds not bearing 291574.92 377676.04 414870.16 435442.07
interest
(i) øŐūıĒĝģøðęŃæęĝŃēýċĭĮċĮĊ (i) Central Road and 72018.73 119098.83 122369.83 126076.17
Infrastructure Fund
(ii) ēĭʼŌıĒēĭÿđĭúŊ̾ĈĭĒıčĲĕĚĲʋ (ii) National Highway Permanent 19255.72 10650.00 10600.00 12500.00
ĮċĮĊ Bridges Fee Fund
(iii) ùĭċøʞĭĆĮċĮĊ (iii) Mines Welfare Fund ... ... ... ...
(iv) úĭēŃĂıđļýċĮċĮĊ (iv) Guarantee Redemption Fund ... ... ... ...
(v) ŮĭēŃĮĐøĮĚƗĭøļĜ (v) Prarambhic Shiksha Kosh 24842.49 28920.11 28920.11 31812.12
(vi) ĚøŊēĭĮęøĭĝĮċĮĊ (vi) Sugar Development Fund ... ... ... ...
(vii) ĮęĚĸĜēĸĕęĸĝĲēƗĭĮċĮĊõē (vii) Spl. Rly. Safety Fd and Rly. 31021.15 35000.00 34750.00 38500.00
ēĸĕęĸĝĲēƗĭĮċđĭŊĆøĭĒŊĮċĮĊ Safety Works Fund
(viii) ēĭʼŌıĒŤĭđıĆēļÿúĭēúĭēŃĂı (viii) National Rural Employment 61829.56 60000.00 71001.81 61500.00
ĮċĮĊ Guarantee Fund
(ix) ēĭʼŌıĒçčĉĭŮĮćĮŢĒĭĮċĮĊ (ix) National Disaster Response 2500.00 2480.00 2790.00 2930.00
Fund
(x) æɊŮĭēĮƗćĮċĮĊĒĭŃ (x) Other Reserve Funds 80107.27 121527.10 144438.41 162123.78
ûÿđĭõēæĮŤđ D. DEPOSITS AND AVANCES 299172.22 163458.02 154234.72 217182.96
øĝɯĭÿÿđĭēĭĮĚĒĭŃ (a) Deposits bearing interest 4756.64 8131.41 7568.45 8186.22
(i) ēĭʼŌıĒēƗĭĮċĮĊ (i) National Defence Fund 17.49 70.00 70.00 70.00
(ii) čįēęĭēčŐĚċ§ĝĞ§ÿıęċďıđĭ (ii) Family Pension-cum-Life ... ... ... ...
ĮċĮĊĒĭŃçĮĉ͡ Assurance funds etc.
(iii) æɊÿđĭēĭĮĚĒĭŃ (iii) Other Deposits 4739.15 8061.41 7498.45 8116.22
ùĮċɯĭŊÿÿđĭēĭĮĚĒĭŃ (b) Deposits not bearing interest 239702.18 155326.61 146666.27 208996.74
(i) ĮĝĮęĕÿđĭēĭĮĚĒĭŃ (i) Civil Deposits 20008.64 15000.00 17000.00 17000.00
(ii) ̾ĈĭċıĒĮċĮĊĒļŃøıÿđĭēĭĮĚĒĭŃ (ii) Deposits of Local Funds ... ... ... ...
(iii) ēĭʼŌıĒĮċęĸĚĮċĮĊ (iii) National Investment Fund 78313.57 90000.00 59700.00 120000.00
(iv) æɊÿđĭēĭĮĚĒĭŃ (iv) Other Deposits 141379.97 50326.61 69966.27 71996.74
úæĮŤđ (c) Advances 54713.40 ... ... ...
ģêýŃćõēĮęĮęĊ E. SUSPENSE AND MISCELLANEOUS 23117.56 ... ... ...
êýŃćĕĸùĭĮċęĕ Suspense Account (Net) 11452.03 ... ... ...
ýĹøõēŠŃĮĄĒĭŃĮċęĕ Cheque and Bills (Net) ... ... ... ...
ĮęĐĭúıĒĚĸĜĮċęĕ Departmental Balances (Net) 4050.37 ... ... ...
ċøĉĚĸĜĮċęĸĚ Cash Balance Investment ... ... ... ...
æɊ Others 7615.16 ... ... ...
ýŮĸĜĆ F. REMITTANCES 5905.30 ... ... ...
(i) đċıòĄŊē (i) Money Orders 324.88 ... ... ...
(ii) æɊĮęŮĸĜĆ (ii) Other Remittances 5580.42 ... ... ...
ÿļģ§ĕļøùĭćĭĝŃĮęćēĆ TOTAL-PUBLIC ACCOUNT 1647235.45 1594386.10 1828099.19 1987339.49
DISBURSEMENTS
øĲĕÿļģ§(I +II +III ) GRAND TOTAL - (I+II+III) 10427941.84 10783970.47 11309363.75 12309007.43
ēļøģĚĸĜ CASH BALANCE 2729.00 -90852.19 2729.00 55735.11
ÿļģ TOTAL 10430670.84 10693118.28 11312092.75 12364742.54
14
ĮęĊĭċđŃĄĕēĮĞćĝŃûēĭǛƗĸũļŃøıŮĭİɑĒĭŃõēʩĒ
RECEIPTS AND EXPENDITURE OF UNION TERRITORIES WITHOUT LEGISTATURE
ŮĭİɑĒĭŃRECEIPTS ʩĒEXPENDITURE
(àøēļģ(In à crores) (àøēļģ(In à crores)
ďÿĂæċĲđĭċ ĝŃĚļĮĊćæċĲđĭċ ďÿĂæċĲđĭċ ďÿĂæċĲđĭċ ĝŃĚļĮĊćæċĲđĭċ ďÿĂæċĲđĭċ
Budget Revised Budget Budget Revised Budget
Estimates Estimates Estimates Estimates Estimates Estimates
2019-2020 2019-2020 2020-2021 2019-2020 2019-2020 2020-2021
æŃĄđĭċõēĮċøļďĭēȪıčĝđĳĞANDAMAN AND NICOBAR ISLANDS
øēēĭÿˢ ēĭÿˢʩĒ
Tax Revenue Revenue
408.00 1050.23 1268.00 Expenditure 4215.90 4442.60 4541.90
øē§ĮĐɄēĭÿˢ čĳŃÿıʩĒ
Non-Tax Revenue 390.00 404.00 444.40 Capital Expenditure 621.80 536.98 646.68
ìĆõēæĮŤđ
Loans and advances 0.00 0.00 0.00
ÿļģTotal 798.00 1454.23 1712.40 ÿļģTotal 4837.70 4979.58 5188.58
ýŃĄıúĤCHANDIGARH
Tax Revenue Revenue
3782.00 3927.08 4149.30 Expenditure 4050.07 4061.36 4300.96
ìĆõēæĮŤđ
Loans and advances
ĉĭĉēĭõēċúēĞęĸĕıćĈĭĉđċðęŃĉıęDADRA AND NAGAR HAVELI

AND DAMAN AND DIU
Tax Revenue Revenue
2208.11 1890.67 2053.58 Expenditure 1339.93 1278.07 1428.10
ìĆõēæĮŤđ
ĕȞĭùLADAKH
Tax Revenue Revenue
0.00 0.00 0.00 Expenditure 0.00 0.00 2331.72
ìĆõēæĮŤđ
Loans and advances
ĕƗȪıčLAKSHADWEEP
Tax Revenue Revenue
12.00 16.02 29.12 Expenditure 1090.61 1129.88 1148.34
ìĆõēæĮŤđ
ĝĭēĭŃĚSUMMARY
Tax Revenue Revenue
6410.11 6884.00 7500.00 Expenditure 10696.51 10911.91 13751.02
ìĆõēæĮŤđ
ĮĂɔĆıêēļƅʩĒæċĲđĭċļŃđŐøĸȾıĒĝģøõēæęĝŃēýċĭĮċĮĊĝĸĮęȅčļĮĜćˋıđļŃøĸĮĕðæċĲĉĭċļŃøļĚĭĮđĕĮøĒĭúĒĭĞĹ~ÿĹĝĭøıđĭŃúĝŃ³¯ĝģøčįēęĞċõēēĭÿđĭúŊđŃũĭĕĒđŐ
ĮĉĒĭúĒĭĞĹ
Note: The expenditure estimates are net of recoveries and include grants for schemes financed from Central Road and Infrastructure Fund as provided in
Demand No. 84: Ministry of Road Transport and Highways.
BILL No. 26 OF 2020
THE FINANCE BILL, 2020
(AS INTRODUCED IN LOK SABHA)

_________
ARRANGEMENT OF CLAUSES
__________
CHAPTER I
PRELIMINARY
CLAUSES
1. Short title and commencement.
CHAPTER II
RATES OF INCOME-TAX
2. Income-tax.
CHAPTER III
DIRECT TAXES
Income-tax
3. Amendment of section 2.
6. Amendment of section 9A.
11. Amendment of section 12AA.
12. Insertion of new section 12AB.
14. Amendment of section 32AB.
16. Amendment of section 33ABA.
18. Amendment of section 35AD.
19. Amendment of section 35D.
20. Amendment of section 35E.
22. Amendment of section 43CA.
24. Amendment of section 44DA.
26. Amendment of section 50B.
27. Amendment of section 50C.
31. Substitution of new section for section 72AA.
32. Amendment of section 80EEA.
33. Amendment of section 80G.
(ii)
CLAUSES
34. Amendment of section 80GGA.

35. Amendment of section 80-IA.
36. Amendment of section 80-IAC.
37. Amendment of section 80-IB.
38. Amendment of section 80-IBA.
39. Amendment of section 80JJAA.
40. Insertion of new section 80M.
43. Amendment of section 92CB.
44. Amendment of section 92CC.
45. Amendment of section 92F.
46. Amendment of section 94B.
48. Amendment of section 115AC.
49. Amendment of section 115ACA.
50. Amendment of section 115AD.
51. Amendment of section 115BAA.
52. Amendment of section 115BAB.
53. Insertion of new sections 115BAC and 115BAD.
54. Amendment of section 115BBDA.
56. Amendment of section 115JB.
57. Amendment of section 115JC.
58. Amendment of section 115JD.
59. Amendment of section 115-O.
60. Amendment of section 115R.
61. Amendment of section 115TD.
62. Amendment of section 115UA.
63. Amendment of section 115VW.
64. Insertion of new section 119A.
77. Amendment of section 194H.
78. Amendment of section 194-I.
79. Amendment of section 194J.
80. Insertion of new section 194K.
81. Amendment of section 194LBA.
82. Amendment of section 194LC.
83. Amendment of section 194LD.
84. Insertion of new section 194-O.
88. Amendment of section 196D.
(iii)
CLAUSES
90. Omission of section 203AA.

92. Amendment of section 206AA.
94. Insertion of new section 234G.
98. Insertion of new section 271AAD.
99. Insertion of new section 271K.
101. Insertion of new section 285BB.
104. Amendment of First Schedule.
CHAPTER IV
INDIRECT TAXES
Customs

107. Amendment of section 28AAA.
108. Insertion of new Chapter VAA.
109. Amendment of heading of Chapter VIIA.
110. Insertion of new section 51B.
Customs Tariff
114. Substitution of new section for section 8B.

115. Amendment of First Schedule.
Central Goods and Services Tax

129. Amendment to Schedule II.
130. Retrospective exemption from, or levy or collection of, central tax in certain cases.
131. Retrospective effect to notification issued under clause (ii) of proviso to sub-section (3) of section 54 of
Central Goods and Services Tax Act.
(iv)
CLAUSES
133. Retrospective exemption from, or levy or collection of, integrated tax in certain cases.
Union Territory Goods and Services Tax

137. Retrospective exemption from, or levy or collection of, Union territory tax in certain cases.
Goods and Services Tax

(Compensation to States)
CHAPTER V
HEALTH CESS
139. Health Cess on imported medical devices.
CHAPTER VI
MISCELLANEOUS
PART I
AMENDMENTS TO THE INDIAN STAMP ACT, 1899
140. Commencement of this Part.

142. Insertion of new section 73B.
PART II
AMENDMENT TO THE PROHIBITION OF BENAMI PROPERTY TRANSACTIONS ACT, 1988
143. Amendment of Act 45 of 1988.
PART III
AMENDMENT TO THE ELECTION COMMISSION (CONDITIONS OF SERVICE OF
ELECTION COMMISSIONERS AND TRANSACTION OF BUSINESS) ACT, 1991
144. Amendment of Act 11 of 1991.
PART IV
AMENDMENT TO THE FINANCE ACT, 2001
145. Substitution of new Schedule for Seventh Schedule to Act 14 of 2001.

(v)
PART V
AMENDMENTS TO THE FINANCE ACT, 2013
CLAUSES
149. Amendment of sections 119, 120 and 132A.
THE FIRST SCHEDULE.

THE SECOND SCHEDULE.
THE THIRD SCHEDULE.
THE FOURTH SCHEDULE.
THE FIFTH SCHEDULE.
AS INTRODUCED IN LOK SABHA
ON 1ST FEBRUARY, 2020
Bill No. 26 of 2020

A
BILL
to give effect to the financial proposals of the Central Government for the financial year
2020-2021.
BE it enacted by Parliament in the Seventy-first Year of the Republic of India as follows:––
CHAPTER I
PRELIMINARY
1. (1) This Act may be called the Finance Act, 2020. Short title and
commencement.
5 (2) Save as otherwise provided in this Act,—
(a) sections 2 to 104 shall come into force on the 1st day of April, 2020;
(b) sections 116 to 129 and section 132 shall come into force on such date as the
Central Government may, by notification in the Official Gazette, appoint.
CHAPTER II
10 RATES OF INCOME-TAX
2. (1) Subject to the provisions of sub-sections (2) and (3), for the assessment year Income-tax.
commencing on the 1st day of April, 2020, 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.
15 (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
20 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:—
25 (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
30 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;
(iii) the amount of income-tax determined in accordance with sub-clause (i) shall
35 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
40 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
2

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 5
section 164 or section 164A or section 167B of the Income-tax Act, 1961 (hereinafter 43 of 1961
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 10
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: 15
Provided further that in respect of any income chargeable to tax under section 115A,
115AB, 115AC, 115ACA, 115AD, 115B, 115BA, 115BB, 115BBA, 115BBC, 115BBD,
115BBDA, 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,— 20
(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 25
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 exceeding two crore rupees but not exceeding five
crore rupees, at the rate of twenty-five per cent. of such income-tax; and 30
(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 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 35
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; 40
(iii) having a total income [excluding the 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.
of such income-tax;
(iv) having a total income [excluding the income of the nature referred to in 45
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 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. 50
of such income-tax:
Provided that in case where the total income includes any 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 or firm or local authority, at the rate of 55
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 60
exceeds one crore rupees but does not exceed ten crore rupees;
3

(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
5 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,—
10
(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 does not exceed two crore rupees, the total amount
15 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 does not exceed five crore rupees, the total amount
payable as income tax and surcharge thereon shall not exceed the total amount
20 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
25 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
30 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 income-tax on such
income and surcharge thereon, shall not exceed the total amount payable as income-tax
35 on a total income of one crore rupees by more than the amount of income that exceeds
one crore rupees:
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
40 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
45 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. of such income-tax.
50 (4) In cases in which tax has to be charged and paid under sub-section (2A) of section
92CE or section 115-O or section 115QA or sub-section (2) of section 115R 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.
55 (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.
60 (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, 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,—
4

being a non-resident, calculated,—
(i) at the rate of ten per cent. of such tax, where the income or the aggregate of 5
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; 10
(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 15
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 income or the aggregate of such
incomes paid or likely to be paid and subject to the deduction exceeds one crore
rupees; 20
(c) in the case of every company, other than a domestic company, calculated,—
(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;
(ii) at the rate of five per cent. of such tax, where the income or the aggregate of 25
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, 30
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,—
(a) in the case of every individual or Hindu undivided family or association of 35

being a non-resident, calculated,—
(i) at the rate of ten per cent. of such tax, where the amount or the aggregate of
such amounts collected and subject to the collection exceeds fifty lakh rupees but 40
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 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 45
aggregate of such incomes collected or 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 incomes collected or likely to be collected and subject to the
collection exceeds five crore rupees; 50
(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 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 55
such amounts 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 and subject to the collection exceeds ten crore rupees.
5

(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 in which the “advance tax” payable under Chapter XVII-C of the said Act has
5 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 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
10 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
15 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 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
20 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,
115BBDA, 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
25 of the Union, calculated,—

not having any income under section 115AD of the Income-tax Act,—
30
(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
35 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
40 (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
45 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 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;
50
(iv) at the rate of thirty-seven per cent. of such “advance tax”, where the total
income [excluding the 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 of the nature referred to in clause (b) of such-section (1) of
55 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 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.;
60
(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. of such “advance tax”, where the
total income exceeds one crore rupees;
6

(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; 5
(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; 10
(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,— 15
(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 20
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 25
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 30
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 35
income of one crore rupees by more than the amount of income that exceeds one crore
rupees:
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 40
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:
under section 115JB of the Income-tax Act, and such income exceeds ten crore rupees, 45
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 50
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 55
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. 60
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”:
7

(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
5 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 Chapter XVII-C of the said Act, at the rate or rates in force,—
(a) the net agricultural income shall be taken into account, in the manner provided in
10 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 or computing such income-tax or,
as the case may be, “advance tax” in respect of the total income; and
(b) such income-tax or, as the case may be, “advance tax” shall be so charged or
15 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;
20 (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;
25 (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:
30 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:
35 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:
40 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
45 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.
50 (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. of such income-tax and surcharge so as to fulfil the
55 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
60 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
65 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;
8

(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);
(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 5
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 10
DIRECT TAXES
Income-tax
Amendment 3. In section 2 of the Income-tax Act,––

of section 2.
(i) in clause (13A), with effect from the 1st day of April, 2021,––
(a) in sub-clause (ii), the word “and” occurring at the end shall be omitted; 15
(b) the long line shall be omitted;
(ii) in clause (42A), in Explanation 1, in clause (i), after sub-clause (hg), the
following sub-clause shall be inserted, namely:––
“(hh) in the case of a capital asset, being a unit or units in a segregated portfolio
referred to in sub-section (2AG) of section 49, there shall be included the period for 20
which the original unit or units in the main portfolio were held by the assessee;”.
Amendment 4. In section 6 of the Income-tax Act, with effect from the 1st day of April, 2021,––
of section 6.
(a) in clause (1), in Explanation 1, in clause (b), for the words “one hundred and
eighty-two days", the words “one hundred and twenty days” shall be substituted;
(b) after clause (1), the following clause shall be inserted, namely:–– 25
“(1A) Notwithstanding anything contained in clause (1), an individual, being a

citizen of India, shall be deemed to be resident in India in any previous year, if he is
not liable to tax in any other country or territory by reason of his domicile or
residence or any other criteria of similar nature.”;
(c) for clause (6), the following clause shall be substituted, namely:–– 30
'(6) A person is said to be “not ordinarily resident” in India in any previous year, if
such person is—
(a) an individual who has been a non-resident in India in seven out of the ten
previous years preceding that year; or
(b) a Hindu undivided family whose manager has been a non-resident in India 35
in seven out of the ten previous years preceding that year.'.
Amendment 5. In section 9 of the Income-tax Act, in sub-section (1),––

of section 9.
(a) in clause (i),––
(i) in Explanation 1, in clause (a), for the words “in the case of a business”, the
words “in the case of a business, other than the business having business 40
connection in India on account of significant economic presence,” shall be
substituted with effect from the 1st day of April, 2022;
(ii) Explanation 2A shall be omitted with effect from the 1st day of April, 2021 and
the following Explanation shall be inserted with effect from the 1st day of April,
2022, namely:–– 45
‘Explanation 2A.—For the removal of doubts, it is hereby declared that the

significant economic presence of a non-resident in India shall constitute
"business connection" in India and "significant economic presence" for this
purpose, shall mean—
(a) transaction in respect of any goods, services or property carried out by 50

a non-resident with any person in India including provision of download of data
9

or software in India, if the aggregate of payments arising from such transaction
or transactions during the previous year exceeds such amount as may be
prescribed; or
(b) systematic and continuous soliciting of business activities or engaging in

5 interaction with such number of users in India, as may be prescribed:
Provided that the transactions or activities shall constitute significant economic

presence in India, whether or not—
(i) the agreement for such transactions or activities is entered in India; or
(ii) the non-resident has a residence or place of business in India; or
10 (iii) the non-resident renders services in India:
Provided further that only so much of income as is attributable to the

transactions or activities referred to in clause (a) or clause (b) shall be deemed
to accrue or arise in India.’;
(iii) after Explanation 3, the following Explanation shall be inserted with effect
15 from the 1st day of April, 2021, namely:––
“Explanation 3A.––For the removal of doubts, it is hereby declared that the

income attributable to the operations carried out in India, as referred to in
Explanation 1, shall include income from––
(i) such advertisement which targets a customer who resides in India or a

20 customer who accesses the advertisement through internet protocol address
located in India;
(ii) sale of data collected from a person who resides in India or from a
person who uses internet protocol address located in India; and
(iii) sale of goods or services using data collected from a person who
25 resides in India or from a person who uses internet protocol address located in
India.”;
(iv) after Explanation 3A as so inserted, the following proviso shall be inserted

with effect from the 1st day of April, 2022, namely:––
“Provided that the provisions contained in this Explanation shall also apply to
30 the income attributable to the transactions or activities referred to in
Explanation 2A.”;
(v) in Explanation 5,––
(I) in the second proviso, after the words, brackets and figures “Securities and
Exchange Board of India (Foreign Portfolio Investors) Regulations, 2014”, the
35 words “prior to their repeal” shall be inserted;
(II) after the second proviso, the following proviso shall be inserted, namely:––
“Provided also that nothing contained in this Explanation shall apply to an

asset or a capital asset, which is held by a non-resident by way of investment,
directly or indirectly, in Category-I foreign portfolio investor under the
40 Securities and Exchange Board of India (Foreign Portfolio Investors)
Regulations, 2019, made under the Securities and Exchange Board of
15 of 1992. India Act, 1992.”;
(b) in clause (vi), in Explanation 2, in clause (v), the words “, but not including
consideration for the sale, distribution or exhibition of cinematographic films” shall be
45 omitted with effect from the 1st day of April, 2021.
6. In section 9A of the Income-tax Act, in sub-section (3),–– Amendment

of section 9A.
(a) in clause (c), the following proviso shall be inserted, namely:––
“Provided that for the purposes of calculation of the said aggregate participation
or investment in the fund, any contribution made by the eligible fund manager
50 during the first three years of operation of the fund, not exceeding twenty-five crore
rupees, shall not be taken into account;”;
(b) in clause (j), in the first proviso, for the words “six months from the last day of the
month of its establishment or incorporation, or at the end of such previous year,
whichever is later”, the words “twelve months from the last day of the month of its
55 establishment or incorporation” shall be substituted.
10

Amendment 7. In section 10 of the Income-tax Act,––
of section 10.
(I) in clause (23C),––
(A) with effect from the 1st day of June, 2020,––
(a) for the first and second provisos, the following provisos shall be
substituted, namely:–– 5
“Provided that the exemption to the fund or trust or institution or university

or other educational institution or hospital or other medical institution referred
to in sub-clause (iv) or sub-clause (v) or sub-clause (vi) or sub-clause (via)
under the respective sub-clauses shall not be available to it unless such fund
or trust or institution or university or other educational institution or hospital or 10
other medical institution makes an application in the prescribed form and
manner to the Principal Commissioner or Commissioner, for grant of
approval,––
(i) where such fund or trust or institution or university or other educational

institution or hospital or other medical institution is approved under the 15
second proviso [as it stood immediately before its amendment by the
Finance Act, 2020], within three months from the date on which this clause
has come into force;
(ii) where such fund or trust or institution or university or other

educational institution or hospital or other medical institution is approved 20
and the period of such approval is due to expire, at least six months prior to
expiry of the said period;
(iii) where such fund or trust or institution or university or other

educational institution or hospital or other medical institution has been
provisionally approved, at least six months prior to expiry of the period of 25
the provisional approval or within six months of commencement of its
activities, whichever is earlier;
(iv) in any other case, at least one month prior to the commencement of
the previous year relevant to the assessment year from which the said
approval is sought, 30
and the said fund or trust or institution or university or other educational institution
or hospital or other medical institution is approved under the second proviso:
Provided further that the Principal Commissioner or Commissioner, on receipt

of an application made under the first proviso, shall,—
(i) where the application is made under clause (i) of the said proviso, 35
pass an order in writing granting approval to it for a period of five years;
(ii) where the application is made under clause (ii) or clause (iii) of the
said proviso,––
(a) call for such documents or information from it or make such

inquiries as he thinks necessary in order to satisfy himself about— 40
(A) the genuineness of activities of such fund or trust or institution

or university or other educational institution or hospital or other
medical institution; and
(B) the compliance of such requirements of any other law for the
time being in force by it as are material for the purpose of achieving its 45
objects; and
(b) after satisfying himself about the objects and the genuineness of
its activities under item (A), and compliance of the requirements under
item (B), of sub-clause (a),––
(A) pass an order in writing granting approval to it for a period of 50
five years;
(B) if he is not so satisfied, pass an order in writing rejecting such
application and also cancelling its approval after affording it a
reasonable opportunity of being heard;
(iii) where the application is made under clause (iv) of the said proviso, 55
pass an order in writing granting approval to it provisionally for a period of
three years from the assessment year from which the registration is sought,
11

and send a copy of such order to the fund or trust or institution or university or
other educational institution or hospital or other medical institution:”;
(b) for the eighth and ninth provisos, the following provisos shall be
substituted, namely:––
5 “Provided also that any approval granted under the second proviso shall
apply in relation to the income of the fund or trust or institution or university or
other educational institution or hospital or other medical institution,––
(i) where the application is made under clause (i) of the first proviso, from
the assessment year from which approval was earlier granted to it;
10 (ii) where the application is made under clause (iii) of the first proviso,
from the first of the assessment years for which it was provisionally
approved;
(iii) in any other case, from the assessment year immediately following
the financial year in which such application is made:
15 Provided also that the order under clause (i), sub-clause (b) of clause (ii)
and clause (iii) of the second proviso shall be passed, in such form and
manner as may be prescribed, before expiry of the period of three months,
six months and one month, respectively, calculated from the end of the
month in which the application was received:”;
20 (B) in the tenth proviso, for the words and figures “section 288 and furnish along
with the return of income for the relevant assessment year”, the words, figures and
letters “section 288 before the specified date referred to in section 44AB and furnish
by that date” shall be substituted;
(C) with effect from the 1st day of June, 2020,––
25 (a) the sixteenth proviso shall be omitted;
(b) for the eighteenth proviso, the following proviso shall be substituted,
namely:––
“Provided also that all applications made under the first proviso [as it stood
before its amendment by the Finance Act, 2020] pending before the Principal
30 Commissioner or Commissioner, on which no order has been passed before
the date on which the first proviso has come into force, shall be deemed to be
an application made under clause (iv) of the first proviso on that date:”;
(II) with effect from the 1st day of April, 2021,––
(a) in clause (23D), in the opening portion, the words, figures and letter “subject
35 to the provisions of Chapter XII-E,” shall be omitted;
(b) in clause (23FC), in sub-clause (b), for the words, brackets, figures and letter
“referred to in sub-section (7) of section 115-O”, the words “received or receivable
from a special purpose vehicle” shall be substituted;
(c) in clause (23FD), the words, brackets and letter “sub-clause (a) of” shall be
40 omitted;
(d) after clause (23FD), the following clause shall be inserted, namely:––
‘(23FE) any income of a specified person in the nature of dividend, interest or

long-term capital gains arising from an investment made by it in India, whether in
the form of debt or equity, if the investment––
45 (i) is made on or before the 31st day of March, 2024;
(ii) is held for at least three years; and
(iii) is in a company or enterprise carrying on the business of developing, or

operating and maintaining, or developing, operating and maintaining any
infrastructure facility as defined in the Explanation to clause (i) of
50 sub-section (4) of section 80-IA or such other business as the Central
Government may, by notification in the Official Gazette, specify in this behalf.
Explanation.—For the purposes of this clause, “specified person” means––
(a) a wholly owned subsidiary of the Abu Dhabi Investment Authority

which––
12

(i) is a resident of the United Arab Emirates; and
(ii) makes investment, directly or indirectly, out of the fund owned by

the Government of the United Arab Emirates;
(b) a sovereign wealth fund which satisfies the following conditions,

namely:–– 5
(i) it is wholly owned and controlled, directly or indirectly, by the

Government of a foreign country;
(ii) it is set up and regulated under the law of such foreign country;
(iii) the earnings of the said fund are credited either to the account of
the Government of that foreign country or to any other account 10
designated by that Government so that no portion of the earnings inures
any benefit to any private person;
(iv) the asset of the said fund vests in the Government of such foreign
country upon dissolution;
(v) it does not undertake any commercial activity whether within or 15

outside India; and
(vi) it is specified by the Central Government, by notification in the

Official Gazette, for this purpose;’;
(e) in clause (34), after the proviso, the following proviso shall be inserted,
namely:–– 20
“Provided further that nothing contained in this clause shall apply to any
income by way of dividend received on or after the 1st day of April, 2020;”;
(f) in clause (35), after the proviso, the following proviso shall be inserted,
namely:––
“Provided further that nothing contained in this clause shall apply to any 25
income in respect of units received on or after the 1st day of April, 2020;”;
(g) clause (45) shall be omitted;
(III) after clause (48B), the following clause shall be inserted, namely:––
“(48C) any income accruing or arising to the Indian Strategic Petroleum

Reserves Limited, being a wholly owned subsidiary of the Oil Industry Development 30
Board under the Ministry of Petroleum and Natural Gas, as a result of arrangement
for replenishment of crude oil stored in its storage facility in pursuance of directions
of the Central Government in this behalf:
Provided that nothing contained in this clause shall apply to an arrangement, if

the crude oil is not replenished in the storage facility within three years from the end 35
of the financial year in which the crude oil was removed from the storage facility for
the first time;”.
Amendment of 8. In section 10A of the Income-tax Act, in sub-section (5),––
section 10A.
(i) the words “along with the return of income,” shall be omitted;
(ii) after the word and figures “section 288” , the words, figures and letters “before 40
the specified date referred to in section 44AB” shall be inserted.
Amendment 9. In section 11 of the Income-tax Act, in sub-section (7), with effect from the 1st
of section 11. day of June, 2020,––
(a) for the words, brackets, letters and figures “under clause (b) of sub-section (1)
of section 12AA”, the words, figures and letters “under section 12AA or 45
section 12AB” shall be substituted;
(b) for the words, brackets, figures and letter “clause (1) and clause (23C)”, the
words, brackets, figures and letter “clause (1), clause (23C) and clause (46)” shall
be substituted;
(c) the following provisos shall be inserted, namely:–– 50
“Provided that such registration shall become inoperative from the date on
which the trust or institution is approved under clause (23C) of section 10 or is
notified under clause (46) of the said section, as the case may be, or the date on
which this proviso has come into force, whichever is later:
13

Provided further that the trust or institution, whose registration has become
inoperative under the first proviso, may apply to get its registration operative
under section 12AB subject to the condition that on doing so, the approval under
clause (23C) of section 10 or notification under clause (46) of the said section, as
5 the case may be, to such trust or institution shall cease to have any effect from
the date on which the said registration becomes operative and thereafter, it shall
not be entitled to exemption under the respective clauses.”.
10. In section 12A of the Income-tax Act,–– Amendment of

section 12A.
(I) in sub-section (1),––
10 (A) after clause (ab), the following clause shall be inserted with effect from the
1st day of June, 2020, namely:––
“(ac) notwithstanding anything contained in clauses (a) to (ab), the person in

receipt of the income has made an application in the prescribed form and manner
to the Principal Commissioner or Commissioner, for registration of the trust or
15 institution,––
(i) where the trust or institution is registered under section 12A [as it stood
33 of 1996. immediately before its amendment by the Finance (No. 2) Act, 1996] or under
section 12AA, [as it stood immediately before its amendment by the Finance Act,
2020] within three months from the date on which this clause has come into force;
20 (ii) where the trust or institution is registered under section 12AB and the
period of the said registration is due to expire, at least six months prior to
expiry of the said period;
(iii) where the trust or institution has been provisionally registered under
section 12AB, at least six months prior to expiry of period of the provisional
25 registration or within six months of commencement of its activities, whichever
is earlier;
(iv) where registration of the trust or institution has become inoperative due
to the first proviso to sub-section (7) of section 11, at least six months prior to
the commencement of the assessment year from which the said registration is
30 sought to be made operative;
(v) where the trust or institution has adopted or undertaken modifications of

the objects which do not conform to the conditions of registration, within a
period of thirty days from the date of the said adoption or modification;
(vi) in any other case, at least one month prior to the commencement of the
35 previous year relevant to the assessment year from which the said
registration is sought,
and such trust or institution is registered under section 12AB;”;
(B) in clause (b), for the words “and the person in receipt of the income furnishes
along with the return of income for the relevant assessment year”, the words,
40 figures and letters “before the specified date referred to in section 44AB and the
person in receipt of the income furnishes by that date” shall be substituted;
(II) in sub-section (2), with effect from the 1st day of June, 2020,––
(A) in the first proviso, for the words “Provided that", the following shall be
substituted, namely:––
45 “Provided that the provisions of sections 11 and 12 shall apply to a trust or

institution, where the application is made under––
(a) sub-clause (i) of clause (ac) of sub-section (1), from the assessment
year from which such trust or institution was earlier granted registration;
(b) sub-clause (iii) of clause (ac) of sub-section (1), from the first of the
50 assessment years for which it was provisionally registered:
Provided further that”;
(B) in the second proviso, for the words “Provided further”, the words
“Provided also” shall be substituted;
(C) in the first and third provisos, after the word, figures and letters “section
55 12AA”, the words, figures and letters “or section 12AB” shall be inserted.
14

Amendment 11. In section 12AA of the Income-tax Act, after sub-section (4), the following
of section sub-section shall be inserted with effect from the 1st day of June, 2020, namely:––
12AA.
“(5) Nothing contained in this section shall apply on or after the 1st day of
June, 2020.”.
Insertion of 12. After section 12AA of the Income-tax Act, the following section shall be inserted 5
new section with effect from the 1st day of June, 2020, namely:––
12AB.
Procedure for “12AB. (1) The Principal Commissioner or Commissioner, on receipt of an
fresh application made under clause (ac) of sub-section (1) of section 12A, shall,—
registration.
(a) where the application is made under sub-clause (i) of the said clause, pass an
order in writing registering the trust or institution for a period of five years; 10
(b) where the application is made under sub-clause (ii) or sub-clause (iii) or
sub-clause (iv) or sub-clause (v) of the said clause,––
(i) call for such documents or information from the trust or institution or make
such inquiries as he thinks necessary in order to satisfy himself about—
(A) the genuineness of activities of the trust or institution; and 15
(B) the compliance of such requirements of any other law for the time being
in force by the trust or institution as are material for the purpose of achieving
its objects; and
(ii) after satisfying himself about the objects of the trust or institution and the
genuineness of its activities under item (A), and compliance of the requirements 20
under item (B), of sub-clause (i),––
(A) pass an order in writing registering the trust or institution for a period of
five years;

application and also cancelling its registration after affording a reasonable 25
opportunity of being heard;
(c) where the application is made under sub-clause (vi) of the said clause, pass
an order in writing provisionally registering the trust or institution for a period of
three years from the assessment year from which the registration is sought,
and send a copy of such order to the trust or institution. 30
(2) All applications, pending before the Principal Commissioner or Commissioner on

which no order has been passed under clause (b) of sub-section (1) of section 12AA
before the date on which this section has come into force, shall be deemed to be an
application made under sub-clause (vi) of clause (ac) of sub-section (1) of section 12A
on that date. 35
(3) The order under clause (a), sub-clause (ii) of clause (b) and clause (c), of
sub-section (1) shall be passed, in such form and manner as may be prescribed, before
expiry of the period of three months, six months and one month, respectively, calculated
from the end of the month in which the application was received.
(4) Where registration of a trust or an institution has been granted under clause (a) 40
or clause (b) of sub-section (1) and subsequently, the Principal Commissioner or
Commissioner is satisfied that the activities of such trust or institution are not genuine
or are not being carried out in accordance with the objects of the trust or institution, as
the case may be, he shall pass an order in writing cancelling the registration of such
trust or institution after affording a reasonable opportunity of being heard. 45
(5) Without prejudice to the provisions of sub-section (4), where registration of a

trust or an institution has been granted under clause (a) or clause (b) of sub-section (1)
and subsequently, it is noticed that––
(a) the activities of the trust or the institution are being carried out in a manner
that the provisions of sections 11 and 12 do not apply to exclude either whole or any 50
part of the income of such trust or institution due to operation of sub-section (1) of
section 13; or
(b) the trust or institution has not complied with the requirement of any other law,
as referred to in item (B) of sub-clause (i) of clause (b) of sub-section (1), and the
order, direction or decree, by whatever name called, holding that such 55
non-compliance has occurred, has either not been disputed or has attained finality,
15

then, the Principal Commissioner or the Commissioner may, by an order in writing, after
affording a reasonable opportunity of being heard, cancel the registration of such trust or
institution.”.
13. In section 17 of the Income-tax Act, in clause (2), for sub-clause (vii), the following Amendment
5 sub-clauses shall be substituted with effect from the 1st day of April, 2021, namely:–– of section 17.
“(vii) the amount or the aggregate of amounts of any contribution made to the
account of the assessee by the employer––
(a) in a recognised provident fund;
(b) in the scheme referred to in sub-section (1) of section 80CCD; and
10 (c) in an approved superannuation fund,
to the extent it exceeds seven lakh and fifty thousand rupees in a previous year;
(viia) the annual accretion by way of interest, dividend or any other amount of
similar nature during the previous year to the balance at the credit of the fund or
scheme referred to in sub-clause (vii) to the extent it relates to the contribution referred
15 to in the said sub-clause which is included in total income under the said sub-clause in
any previous year computed in such manner as may be prescribed; and”.
14. In section 32AB of the Income-tax Act, in sub-section (5), for the words “and the Amendment
assessee furnishes, along with his return of income,”, the words, figures and letters of section
“before the specified date referred to in section 44AB and the assessee furnishes by that 32AB.
20 date” shall be substituted.
15. In section 33AB of the Income-tax Act, in sub-section (2), for the words “and the Amendment
“before the specified date referred to in section 44AB and the assessee furnishes by that 33AB.
date” shall be substituted.
25 16. In section 33ABA of the Income-tax Act, in sub-section (2), for the words “and the Amendment
“before the specified date referred to in section 44AB and the assessee furnishes by that 33ABA.
17. In section 35 of the Income-tax Act, with effect from the 1st day of June, 2020,–– Amendment
of section 35.
30 (i) in sub-section (1),––
(a) after sub-clause (iii), in the Explanation, for the words, brackets and figures,––
(A) “to which clause (ii) or clause (iii)”, the words, brackets, figures and letter
“to which clause (ii) or clause (iii) or to a company to which clause (iia)” shall be
substituted;
35 (B) “clause (ii) or clause (iii)”, the words, brackets, figures and letter “clause (ii)
or clause (iii) or to a company referred to in clause (iia)” shall be substituted;
(b) after the fourth proviso occurring after clause (iv), the following provisos shall
be inserted, namely:––
“Provided also that every notification under clause (ii) or clause (iii) in respect
40 of the research association, university, college or other institution or under
clause (iia) in respect of the company issued on or before the date on which this
sub-section has come into force, shall be deemed to have been withdrawn
unless such research association, university, college or other institution referred
to in clause (ii) or clause (iii) or the company referred to in clause (iia) makes an
45 intimation in such form and manner, as may be prescribed, to the prescribed
income-tax authority within three months from the date on which this proviso has
come into force, and subject to such intimation the notification shall be valid for a
period of five consecutive assessment years beginning with the assessment year
commencing on or after the 1st day of April, 2021:
50 Provided also that any notification issued by the Central Government under
clause (ii) or clause (iia) or clause (iii), after the date on which the Finance Bill,
2020 receives the assent of the President, shall, at any one time, have effect for
such assessment year or years, not exceeding five assessment years as may be
specified in the notification.”;
55 (ii) after sub-section (1), the following sub-section shall be inserted, namely:––
16

“(1A) Notwithstanding anything contained in sub-section (1), the research
association, university, college or other institution referred to in clause (ii) or
clause (iii) or the company referred to in clause (iia) of sub-section (1) shall not be
entitled to deduction under the respective clauses of the said sub-section, unless
such research association, university, college or other institution or company–– 5
(i) prepares such statement for such period as may be prescribed and deliver
or cause to be delivered to the said prescribed income-tax authority or the person
authorised by such authority such statement in such form, verified in such
manner, setting forth such particulars and within such time, as may be
prescribed: 10
Provided that such research association, university, college or other institution

or the company may also deliver to the prescribed authority a correction
statement for rectification of any mistake or to add, delete or update the
information furnished in the statement delivered under this sub-section in such
form and verified in such manner as may be prescribed; and 15
(ii) furnishes to the donor, a certificate specifying the amount of donation in

such manner, containing such particulars and within such time from the date of
receipt of sum, as may be prescribed.”.
Amendment of 18. In section 35AD of the Income-tax Act,––

section 35AD.
(i) in sub-section (1), for the words “An assessee shall”, the words “An assessee 20
shall, if he opts,” shall be substituted;
(ii) in sub-section (4), after the words “in any other previous year”, the words “, if the
deduction has been claimed or opted by the assessee and allowed to him under this
section” shall be inserted.
Amendment 19. In section 35D of the Income-tax Act, in sub-section (4), for the words “and the 25
of section assessee furnishes, along with his return of income for the first year in which the
35D. deduction under this section is claimed, the report of such audit”, the words, figures and
letters “before the specified date referred to in section 44AB and the assessee furnishes
for the first year in which the deduction under this section is claimed, the report of such
audit by that date” shall be substituted. 30
Amendment 20. In section 35E of the Income-tax Act, in sub-section (6), for the words “and the
of section assessee furnishes, along with his return of income for the first year in which the
35E. deduction under this section is claimed, the report of such audit”, the words, figures and
letters “before the specified date refered to in section 44AB and the assessee furnishes
for the first year in which the deduction under this section is claimed, the report of such 35
audit by that date” shall be substituted.
Amendment 21. In section 43 of the Income-tax Act, in clause (5),—

of section 43.
(a) for the words “recognised association” wherever they occur, the words
“recognised stock exchange” shall be substituted;
(b) in Explanation 2, for clause (iii), the following clause shall be substituted, 40
namely:––
‘(iii) “recognised stock exchange” means a recognised stock exchange as

referred to in clause (f) of section 2 of the Securities Contracts (Regulation)
Act, 1956 and which fulfils such conditions as may be prescribed and notified by the 42 of 1956.
Central Government for this purpose;’. 45
Amendment 22. In section 43CA of the Income-tax Act, in sub-section (1), in the proviso, for the
of section words “five per cent.”, the words “ten per cent.” shall be substituted with effect from the
43CA. 1st day of April, 2021.
Amendment of 23. In section 44AB of the Income-tax Act,––
section 44AB.
(A) in clause (a),–– 50
(i) the word “or” occurring at the end shall be omitted;

(ii) the following proviso shall be inserted, namely:––
'Provided that in the case of a person whose––
(a) aggregate of all amounts received including amount received for sales,
turnover or gross receipts during the previous year, in cash, does not exceed 55
five per cent. of the said amount; and
17

(b) aggregate of all payments made including amount incurred for
expenditure, in cash, during the previous year does not exceed five per cent.
of the said payment,
this clause shall have effect as if for the words “one crore rupees”, the words “five
5 crore rupees” had been substituted; or';
(B) in the Explanation, in clause (ii), after the word “means”, the words “date one
month prior to” shall be inserted.
24. In section 44DA of the Income-tax Act, in sub-section (2), for the words “and furnish Amendment
along with the return of income,”, the words, figures and letters “before the specified date of section
10 referred to in section 44AB and furnish by that date” shall be substituted. 44DA.
25. In section 49 of the Income-tax Act, after sub-section (2AF), the following shall be Amendment
inserted, namely:–– of section 49.
‘(2AG) The cost of acquisition of a unit or units in the segregated portfolio shall be
the amount which bears, to the cost of acquisition of a unit or units held by the
15 assessee in the total portfolio, the same proportion as the net asset value of the asset
transferred to the segregated portfolio bears to the net asset value of the total portfolio
immediately before the segregation of portfolios.
(2AH) The cost of the acquisition of the original units held by the unit holder in the
main portfolio shall be deemed to have been reduced by the amount as so arrived at
20 under sub-section (2AG).
Explanation.––For the purposes of sub-section (2AG) and sub-section (2AH), the

expressions “main portfolio”, “segregated portfolio” and “total portfolio” shall have the
meanings respectively assigned to them in the circular No.
SEBI/HO/IMD/DF2/CIR/P/2018/160, dated the 28th December, 2018, issued by the
25 Securities and Exchange Board of India under section 11 of the Securities and
15 of 1992. Exchange Board of India Act, 1992.’.
26. In section 50B of the Income-tax Act, in sub-section (3), for the words, brackets and Amendment
figures “along with the return of income, a report of an accountant as defined in the of section
Explanation below sub-section (2) of section 288,”, the words, brackets, figures and 50B.
30 letters “a report of an accountant as defined in the Explanation below sub-section (2) of
section 288 before the specified date referred to in section 44AB” shall be substituted.
27. In section 50C of the Income-tax Act, in sub-section (1), in the third proviso, for the Amendment
words “five per cent.”, the words “ten per cent.” shall be substituted with effect from the of section
1st day of April, 2021. 50C.
35 28. In section 55 of the Income-tax Act, in sub-section (2), in clause (b), after Amendment
sub-clause (ii), the following shall be inserted with effect from the 1st day of April, 2021, of section 55.
namely:—
‘Provided that in case of a capital asset referred to in sub-clauses (i) and (ii), being
land or building or both, the fair market value of such asset on the 1st day of
40 April, 2001 for the purposes of the said sub-clauses shall not exceed the stamp duty
value, wherever available, of such asset as on the 1st day of April, 2001.
Explanation.—For the purposes of this proviso, “stamp duty value” means the value
adopted or assessed or assessable by any authority of the Central Government or a
State Government for the purpose of payment of stamp duty in respect of an
45 immovable property.’.
29. In section 56 of the Income-tax Act, in sub-section (2),–– Amendment

of section 56.
(A) with effect from the 1st day of June, 2020,––
(i) in clause (v), in the proviso, in clause (g), for the word, figures and letters
“section 12AA”, the words, figures and letters “section 12AA or section 12AB” shall
50 be substituted;
(ii) in clause (vi), in the proviso, in clause (g), for the word, figures and letters
“section 12AA”, the words, figures and letters “section 12AA or section 12AB” shall
be substituted;
(iii) in clause (vii), in the second proviso, in clause (g), for the word, figures and
55 letters “section 12AA”, the words, figures and letters “section 12AA or section 12AB”
shall be substituted;
(B) in clause (x),––

18

(i) in sub-clause (b), in item (B), in sub-item (ii), for the words “five per cent.”, the
words “ten per cent.” shall be substituted with effect from the 1st day of April, 2021;
(ii) in the proviso, in clause (VII), for the words, letters and figures “section 12A or
section 12AA”, the words, figures and letters “section 12A or section 12AA or
section 12AB” shall be substituted with effect from the 1st day of June, 2020. 5
Amendment 30. In section 57 of the Income-tax Act, with effect from the 1st day of April, 2021,––
of section 57.
(a) in clause (i), for the words, figures and letter “dividends, other than dividends
referred to in section 115-O”, the word “dividends” shall be substituted;
(b) the following proviso shall be inserted, namely:––
“Provided that no deduction shall be allowed from the dividend income, or 10

income in respect of units of a Mutual Fund specified under clause (23D) of section
10 or income in respect of units from a specified company defined in the
Explanation to clause (35) of section 10, other than deduction on account of interest
expense, and in any previous year such deduction shall not exceed twenty per cent.
of the dividend income, or income in respect of such units, included in the total 15
income for that year, without deduction under this section.”.
Substitution of 31. For section 72AA of the Income-tax Act, the following section shall be substituted,
new section for namely:––
section 72AA.
Carry forward ‘72AA. Notwithstanding anything contained in sub-clauses (i) to (iii) of

and set off of clause (1B) of section 2 or section 72A, where there has been an amalgamation of–– 20
accumulated
loss and (i) one or more banking company with any other banking institution under a
unabsorbed scheme sanctioned and brought into force by the Central Government under
depreciation sub-section (7) of section 45 of the Banking Regulation Act, 1949; or 10 of 1949.
allowance in
scheme of (ii) one or more corresponding new bank or banks with any other corresponding
amalgamation new bank under a scheme brought into force by the Central Government under 25
in certain section 9 of the Banking Companies (Acquisition and Transfer of Undertakings) 5 of 1970.
cases. Act, 1970 or under section 9 of the Banking Companies (Acquisition and Transfer of 40 of 1980.
Undertakings) Act, 1980 or both, as the case may be; or
(iii) one or more Government company or companies with any other Government
company under a scheme sanctioned and brought into force by the Central 30
Government under section 16 of the General Insurance Business (Nationalisation)
Act, 1972, 57 of 1972.
the accumulated loss and the unabsorbed depreciation of such banking company or
companies or amalgamating corresponding new bank or banks or amalgamating
Government company or companies shall be deemed to be the loss or, as the case 35
may be, allowance for depreciation of such banking institution or amalgamated
corresponding new bank or amalgamated Government company for the previous year
in which the scheme of amalgamation was brought into force and other provisions of
this Act relating to set off and carry forward of loss and allowance for depreciation shall
apply accordingly. 40
Explanation.—For the purposes of this section,—
(i) “accumulated loss” means so much of the loss of the amalgamating banking
company or companies or amalgamating corresponding new bank or banks or
amalgamating Government company or companies under the head "Profits and
gains of business or profession" (not being a loss sustained in a speculation 45
business) which such amalgamating banking company or companies or
amalgamating corresponding new bank or banks or amalgamating Government
company or companies, would have been entitled to carry forward and set off under
the provisions of section 72, if the amalgamation had not taken place;
(ii) “banking company” shall have the meaning assigned to it in clause (c) of 50
section 5 of the Banking Regulation Act, 1949; 10 of 1949.
19

(iii) “banking institution” shall have the meaning assigned to it in
10 of 1949. sub-section (15) of section 45 of the Banking Regulation Act, 1949;
(iv) “corresponding new bank” shall have the meaning assigned to it in clause (d)
of section 2 of the Banking Companies (Acquisition and Transfer of Undertakings)
5 of 1970. 5 Act, 1970 or, as the case may be, clause (b) of section (2) of the Banking
40 of 1980. Companies (Acquisition and Transfer of Undertakings) Act, 1980;
(v) “general insurance business” shall have the meaning assigned to it in clause (g) of
57 of 1972. section 3 of the General Insurance Business (Nationalisation) Act, 1972;
(vi) “Government company” means a Government company as defined in clause

18 of 2013. 10 (45) of section 2 of the Companies Act, 2013, which is engaged in the general
insurance business and which has come into existence by operation of section 4 or
section 5 or section 16 of the General Insurance Business (Nationalisation)
57 of 1972. Act, 1972;
(vii) “unabsorbed depreciation” means so much of the allowance for depreciation

15 of the amalgamating banking company or companies or amalgamating
corresponding new bank or banks or amalgamating Government company or
companies which remains to be allowed and which would have been allowed to
such banking company or companies or amalgamating corresponding new bank or
banks or amalgamating Government company or companies, if the amalgamation
20 had not taken place.’.
32. In section 80EEA of the Income-tax Act, in sub-section (3), in clause (i), for the Amendment
figures “2020”, the figures “2021” shall be substituted with effect from the 1st day of of section
April, 2021. 80EEA.
33. In section 80G of the Income-tax Act, with effect from the 1st day of June, 2020,–– Amendment of
section 80G.
25 (i) in sub-section (5),––
(a) in clause (vi), for the words “approved by the Commissioner in accordance
with the rules made in this behalf; and”, the words “approved by the Principal
Commissioner or Commissioner;” shall be substituted;
(b) after sub-clause (vii), the following shall be inserted, namely:––
30 “(viii) the institution or fund prepares such statement for such period as may be
prescribed and deliver or cause to be delivered to the prescribed income-tax
authority or the person authorised by such authority such statement in such form
and verified in such manner and setting forth such particulars and within such
time as may be prescribed:
35 Provided that the institution or fund may also deliver to the said prescribed
authority a correction statement for rectification of any mistake or to add, delete
or update the information furnished in the statement delivered under this
sub-section in such form and verified in such manner as may be prescribed; and
(ix) the institution or fund furnishes to the donor, a certificate specifying the
40 amount of donation in such manner, containing such particulars and within such
time from the date of receipt of donation, as may be prescribed:
Provided that the institution or fund referred to in clause (vi) shall make an
application in the prescribed form and manner to the Principal Commissioner or
Commissioner, for grant of approval,––
45 (i) where the institution or fund is approved under clause (vi) [as it stood
immediately before its amendment by the Finance Act, 2020], within three
months from the date on which this proviso has come into force;
(ii) where the institution or fund is approved and the period of such approval
is due to expire, at least six months prior to expiry of the said period;
50 (iii) where the institution or fund has been provisionally approved, at least
six months prior to expiry of the period of the provisional approval or within six
months of commencement of its activities, whichever is earlier;
(iv) in any other case, at least one month prior to commencement of the
previous year relevant to the assessment year from which the said approval is
55 sought:
Provided further that the Principal Commissioner or Commissioner, on receipt

of an application made under the first proviso, shall,—
20

(i) where the application is made under clause (i) of the said proviso, pass
an order in writing granting it approval for a period of five years;
(ii) where the application is made under clause (ii) or clause (iii) of the said
proviso,––
(a) call for such documents or information from it or make such inquiries 5
as he thinks necessary in order to satisfy himself about—
(A) the genuineness of activities of such institution or fund; and
(B) the fulfilment of all the conditions laid down in clauses (i) to (v); and
(b) after satisfying himself about the genuineness of activities under

item (A), and the fulfilment of all the conditions under item (B), of 10
sub-clause (a),––
(A) pass an order in writing granting it approval for a period of five

years;

application and also cancelling its approval after affording it a reasonable 15
opportunity of being heard;
(iii) where the application is made under clause (iv) of the said proviso, pass
an order in writing granting it approval provisionally for a period of three years
from the assessment year from which the registration is sought,
and send a copy of such order to the institution or fund: 20
Provided also that the order under clause (i), sub-clause (b) of clause (ii)
and clause (iii) of the first proviso shall be passed in such form and manner as
may be prescribed, before expiry of the period of three months, six months
and one month, respectively, calculated from the end of the month in which
the application was received: 25
Provided also that the approval granted under the second proviso shall
apply to an institution or fund, where the application is made under––
(a) clause (i) of the first proviso, from the assessment year from which
approval was earlier granted to such institution or fund;
(b) clause (iii) of the first proviso, from the first of the assessment years 30
for which such institution or fund was provisionally approved;
(c) in any other case, from the assessment year immediately following
the financial year in which such application is made.”;
(ii) in sub-section (5D), after Explanation 2, the following Explanation shall be

inserted, namely:–– 35
“Explanation 2A.— For the removal of doubts, it is hereby declared that claim of
the assessee for a deduction in respect of any donation made to an institution or
fund to which the provisions of sub-section (5) applies, in the return of income for
any assessment year filed by him, shall be allowed on the basis of information
relating to said donation furnished by the institution or fund to the prescribed 40
income-tax authority or the person authorised by such authority, subject to
verification in accordance with the risk management strategy formulated by the
Board from time to time.”;
(iii) after sub-section (5D), the following sub-section shall be inserted, namely:––
“(5E) All applications, pending before the Commissioner on which no order has 45
been passed under clause (vi) of sub-section (5) before the date on which this
sub-section has come into force, shall be deemed to be applications made under
clause (iv) of the first proviso to sub-section (5) on that date.”.
Amendment 34. In section 80GGA of the Income-tax Act, with effect from the 1st day of
of section June, 2020,–– 50
80GGA.
(i) in sub-section (2A), for the words “ten thousand rupees”, the words “two
thousand rupees” shall be substituted;
(ii) after sub-section (4), the following Explanation shall be inserted, namely:––
“Explanation.––For the removal of doubts, it is hereby declared that the claim of

the assessee for a deduction in respect of any sum referred to in sub-section (2) in 55
the return of income for any assessment year filed by him, shall be allowed on the
21

basis of information relating to such sum furnished by the payee to the prescribed
income-tax authority or the person authorised by such authority, subject to
verification in accordance with the risk management strategy formulated by the
Board from time to time.”.
5 35. In section 80-IA of the Income-tax Act, in sub-section (7), for the words “and the Amendment
assessee furnishes, along with his return of income”, the words, figures and letters of section
“before the specified date referred to in section 44AB and the assessee furnishes by that 80-IA.
36. In section 80-IAC of the Income-tax Act, with effect from the 1st day of April, 2021,–– Amendment
of section
80-IAC.
10 (i) in sub-section (2), for the word “seven”, the word “ten” shall be substituted;
(ii) in the Explanation, in clause (ii), in sub-clause (b), for the word “twenty-five”, the
words “one hundred” shall be substituted.
37. In section 80-IB of the Income-tax Act,–– Amendment of

section 80-IB.
(a) in sub-section (7A), in clause (b), for sub-clause (iii), the following sub-clause
15 shall be substituted, namely:––
“(iii) the assessee furnishes the report of audit in such form and containing such
particulars, as may be prescribed, duly signed and verified by an accountant, as
defined in the Explanation below sub-section (2) of section 288, before the specified
date referred to in section 44AB, certifying that the deduction has been correctly
20 claimed.”;
(b) in sub-section (7B), in clause (b), for sub-clause (iii), the following sub-clause
shall be substituted, namely:––
“(iii) the assessee furnishes the report of audit in such form and containing such
25 defined in the Explanation below sub-section (2) of section 288, before the specified
claimed.”;
(c) in sub-section (11B), for clause (iv), the following clause shall be substituted,
namely:––
30 “(iv) the assessee furnishes the report of audit in such form and containing such
claimed.”;
35 (d) in sub-section (11C), for clause (iv), the following clause shall be substituted,
namely:––
“(iv) the assessee furnishes the report of audit in such form and containing such
40 date referred to in section 44AB, certifying that the deduction has been correctly
claimed.”.
38. In section 80-IBA of the Income-tax Act, in sub-section (2), in clause (a), for the Amendment
figures “2020”, the figures “2021” shall be substituted with effect from the 1st day of of section
April, 2021. 80-IBA.
45 39. In section 80JJAA of the Income-tax Act, in sub-section (2), in clause (c), for the Amendment
words, brackets and figures “alongwith the return of income the report of the accountant of section
as defined in the Explanation below sub-section (2) of section 288”, the words, 80JJAA.
brackets, figures and letters “the report of the accountant, as defined in the Explanation
below sub-section (2) of section 288, before the specified date referred to in section
50 44AB” shall be substituted.
40. After section 80LA of the Income-tax Act, the following section shall be inserted Insertion of
with effect from the 1st day of April, 2021, namely:–– new section
80M.
‘80M. (1) Where the gross total income of a domestic company in any previous year Deduction in
includes any income by way of dividends from any other domestic company, there respect of
55 shall, in accordance with and subject to the provisions of this section, be allowed in certain inter-
computing the total income of such domestic company, a deduction of an amount corporate
equal to so much of the amount of income by way of dividends received from such dividends.
other domestic company as does not exceed the amount of dividend distributed by the
first mentioned domestic company on or before the due date.
22

(2) Where any deduction, in respect of the amount of dividend distributed by the
domestic company, has been allowed under sub-section (1) in any previous year, no
deduction shall be allowed in respect of such amount in any other previous year.
Explanation.––For the purposes of this section, the expression “due date” means
the date one month prior to the date for furnishing the return of income under 5
sub-section (1) of section 139.’.
Amendment 41. In section 90 of the Income-tax Act, in sub-section (1), in clause (b), after the words
of section 90. “as the case may be,”, the words and brackets “without creating opportunities for
non-taxation or reduced taxation through tax evasion or avoidance (including through
treaty-shopping arrangements aimed at obtaining reliefs provided in the said agreement 10
for the indirect benefit to residents of any other country or territory),” shall be inserted with
effect from the 1st day of April, 2021.
Amendment 42. In section 90A of the Income-tax Act, in sub-section (1), in clause (b), after the
of section words “specified territory outside India,”, the words and brackets “without creating
90A. opportunities for non-taxation or reduced taxation through tax evasion or avoidance 15
(including through treaty-shopping arrangements aimed at obtaining reliefs provided in the
said agreement for the indirect benefit to residents of any other country or territory),” shall
be inserted with effect from the 1st day of April, 2021.
Amendment 43. In section 92CB of the Income-tax Act, for sub-section (1), the following sub-section
of section shall be substituted, namely:–– 20
92CB.
“(1) The determination of––
(a) income referred to in clause (i) of sub-section (1) of section 9; or
(b) arm’s length price under section 92C or section 92CA,
shall be subject to safe harbour rules.”.
Amendment 44. In section 92CC of the Income-tax Act,–– 25

of section
92CC.
(a) for sub-section (1), sub-section (2) and sub-section (3), the following
sub-sections shall be substituted, namely:––
“(1) The Board, with the approval of the Central Government, may enter into an
advance pricing agreement with any person, determining the––
(a) arm’s length price or specifying the manner in which the arm’s length price 30
is to be determined, in relation to an international transaction to be entered into
by that person;
(b) income referred to in clause (i) of sub-section (1) of section 9, or specifying

the manner in which said income is to be determined, as is reasonably
attributable to the operations carried out in India by or on behalf of that person, 35
being a non-resident.
(2) The manner of determination of the arm's length price referred to in clause (a)
or the income referred to in clause (b) of sub-section (1), may include the methods
referred to in sub-section (1) of section 92C or the methods provided by rules made
under this Act, respectively, with such adjustments or variations, as may be 40
necessary or expedient so to do.
(3) Notwithstanding anything contained in section 92C or section 92CA or the

methods provided by rules made under this Act, the arm's length price of any
international transaction or the income referred to in clause (b) of sub-section (1), in
respect of which the advance pricing agreement has been entered into, shall be 45
determined in accordance with the advance pricing agreement so entered.”;
(b) for sub-section (9A), the following sub-section shall be substituted, namely:––
“(9A) The agreement referred to in sub-section (1), may, subject to such conditions,
procedure and manner as may be prescribed, provide for determining the––
(a) arm's length price or specify the manner in which the arm's length price 50
shall be determined in relation to the international transaction entered into by the
person;
(b) income referred to in clause (i) of sub-section (1) of section 9, or specifying

the manner in which the said income is to be determined, as is reasonably
attributable to the operations carried out in India by or on behalf of that person,
being a non-resident, 55
23

during any period not exceeding four previous years preceding the first of the previous
years referred to in sub-section (4), and the arm's length price of such international
transaction or the income of such person shall be determined in accordance with the
said agreement.”.
5 45. In section 92F of the Income-tax Act, for clause (iv), the following clause shall be Amendment of
substituted, namely:–– section 92F.
‘(iv) “specified date” means the date one month prior to the due date for furnishing
the return of income under sub-section (1) of section 139 for the relevant
assessment year;’.
10 46. In section 94B of the Income-tax Act, after sub-section (1), the following Amendment of
sub-section shall be inserted with effect from the 1st day of April, 2021, namely:–– section 94B.
“(1A) Nothing contained in sub-section (1) shall apply to interest paid in respect of a
debt issued by a lender which is a permanent establishment in India of a non-resident,
being a person engaged in the business of banking.”.
15 47. In section 115A of the Income-tax Act,–– Amendment of

section 115A.
(I) in sub-section (1), in clause (a), the words, figures and letter “other than
dividends referred to in section 115-O” at both the places where they occur, shall be
omitted with effect from the 1st day of April, 2021;
(II) in sub-section (5),––
20 (i) in clause (a), for the word, brackets and letter “clause (a)”, the words, brackets
and letters “clause (a) or clause (b)” shall be substituted;
(ii) for clause (b), the following clause shall be substituted, namely:––
“(b) the tax deductible at source under the provisions of Part B of Chapter XVII
has been deducted from such income and the rate of such deduction is not less
25 than the rate specified under clause (a) or, as the case may be, clause (b) of
sub-section (1).”.
48. In section 115AC of the Income-tax Act, for the words, figures and letter “dividends, Amendment
other than dividends referred to in section 115-O” wherever they occur, the word of section
“dividends” shall be substituted with effect from the 1st day of April, 2021. 115AC.
30 49. In section 115ACA of the Income-tax Act, for the words, figures and letter Amendment
“dividends, other than dividends referred to in section 115-O” wherever they occur, the of section
word “dividends” shall be substituted with effect from the 1st day of April, 2021. 115ACA.
50. In section 115AD of the Income-tax Act, in sub-section (1), in clause (a), the words, Amendment
figures and letter “other than income by way of dividends referred to in section 115-O” of section
35 shall be omitted with effect from the 1st day of April, 2021. 115AD.
51. In section 115BAA of the Income-tax Act, in sub-section (2), in clause (i), for the words, Amendment
figures and letters ‘Chapter VI-A under the heading "C.—Deductions in respect of certain of section
incomes" other than the provisions of section 80JJAA’, the words, figures and letters “Chapter 115BAA.
VI-A other than the provisions of section 80JJAA or section 80M” shall be substituted.
40 52. In section 115BAB of the Income-tax Act, in sub-section (2),–– Amendment

of section
(i) in clause (c), in sub-clause (i), for the words, figures and letters ‘Chapter VI-A 115BAB.
under the heading "C.—Deductions in respect of certain incomes" other than the
provisions of section 80JJAA’, the words, figures and letters “Chapter VI-A other than
the provisions of section 80JJAA or section 80M” shall be substituted;
45 (ii) after clause (c), the following Explanation shall be inserted, namely:––
'Explanation.––For the purposes of clause (b), the “business of manufacture or

production of any article or thing” shall include the business of generation of
electricity.'.
53. After section 115BAB of the Income-tax Act, the following sections shall be inserted Insertion of
50 with effect from the 1st day of April, 2021, namely:–– new sections
115BAC and
115BAD.
'115BAC. (1) Notwithstanding anything contained in this Act but subject to the Tax on
provisions of this Chapter, the income-tax payable in respect of the total income of a income of
person, being an individual or a Hindu undivided family, for any previous year relevant individuals
to the assessment year beginning on or after the 1st day of April, 2021, shall, at the and Hindu
55 option of such person, be computed at the rate of tax given in the following Table, if undivided
the conditions contained in sub-section (2) are satisfied, namely:— family.
24

TABLE
Sl. No. Total income Rate of tax
(1) (2) (3)
1. Upto Rs 2,50,000 Nil
5 2. From Rs 2,50,001 to Rs 5,00,000 5 per cent.
3. From Rs 5,00,001 to Rs 7,50,000 10 per cent.
10 7. Above Rs 15,00,000 30 per cent.:
Provided that where the person fails to satisfy the conditions contained in
sub-section (2) in any previous year, the option shall become invalid in respect of the
assessment year relevant to that previous year and other provisions of this Act shall
apply, as if the option had not been exercised for the assessment year relevant to that
15 previous year:
Provided further that where the option is exercised under clause (i) of sub-section
(5), in the event of failure to satisfy the conditions contained in sub-section (2), it shall
become invalid for subsequent assessment years also and other provisions of this Act
shall apply for those years accordingly.
20 (2) For the purposes of sub-section (1), the total income of the individual or Hindu
undivided family shall be computed,—
(i) without any exemption or deduction under the provisions of clause (5) or
clause (13A) or prescribed under clause (14) (other than those as may be
prescribed for this purpose) or clause (17) or clause (32), of section 10 or section
25 10AA or section 16 or clause (b) of section 24 (in respect of the property referred to
in sub-section (2) of section 23) or clause (iia) of sub-section (1) of section 32 or
section 32AD or section 33AB or section 33ABA or sub-clause (ii) or sub-clause (iia)
or sub-clause (iii), of sub-section (1) or sub-section (2AA), of section 35 or section
35AD or section 35CCC or clause (iia) of section 57 or under any of the provisions
30 of Chapter VI-A other than the provisions of sub-section (2) of section 80CCD or
section 80JJAA;
(ii) without set off of any loss,—
(a) carried forward or depreciation from any earlier assessment year, if such loss
or depreciation is attributable to any of the deductions referred to in clause (i);
35 (b) under the head “Income from house property” with any other head of
income;
(iii) by claiming the depreciation, if any, under any provision of section 32, except
clause (iia) of sub-section (1) of the said section, determined in such manner as
may be prescribed; and
40 (iv) without any exemption or deduction for allowances or perquisite, by whatever

name called, provided under any other law for the time being in force.
(3) The loss and depreciation referred to in clause (ii) of sub-section (2) shall be
deemed to have been given full effect to and no further deduction for such loss or
depreciation shall be allowed for any subsequent year:
45 Provided that where there is a depreciation allowance in respect of a block of assets

which has not been given full effect to prior to the assessment year beginning on the
1st day of April, 2021, corresponding adjustment shall be made to the written down
value of such block of assets as on the 1st day of April, 2020 in the prescribed
manner, if the option under sub-section (5) is exercised for a previous year relevant to
50 the assessment year beginning on the 1st day of April, 2021.
(4) In case of a person, having a Unit in the International Financial Services Centre,
as referred to in sub-section (1A) of section 80LA, which has exercised option under
sub-section (5), the conditions contained in sub-section (2) shall be modified to the
extent that the deduction under section 80LA shall be available to such Unit subject to
55 fulfillment of the conditions contained in the said section.
Explanation.—For the purposes of this sub-section, the term "Unit" shall have the
meaning assigned to it in clause (zc) of section 2 of the Special Economic
Zones Act, 2005. 28 of 2005.
(5) Nothing contained in this section shall apply unless option is exercised in the
60 prescribed manner by the person,—
25

(i) having business income, on or before the due date specified under
sub-section (1) of section 139 for furnishing the returns of income for any previous
year relevant to the assessment year commencing on or after the 1st day of April,
2021, and such option once exercised shall apply to subsequent assessment years;
(ii) having no business income, alongwith the return of income to be furnished under 5
sub-section (1) of section 139 for a previous year relevant to the assessment year:
Provided that the option under clause (i), once exercised for any previous year can be
withdrawn only once for a previous year other than the year in which it was exercised and
thereafter, the person shall never be eligible to exercise option under this section, except
where such person ceases to have any business income in which case, option under 10
clause (ii) shall be available.
115BAD. (1) Notwithstanding anything contained in this Act but subject to the Tax on
provisions of this Chapter, the income-tax payable in respect of the total income of a income of
person, being a co-operative society resident in India, for any previous year relevant to certain
the assessment year beginning on or after the 1st day of April, 2021, shall, at the 15 resident
option of such person, be computed at the rate of twenty-two per cent., if the co-operative
conditions contained in sub-section (2) are satisfied: societies.
Provided that where the person fails to satisfy the conditions contained in
sub-section (2) in computing its income in any previous year, the option shall become
invalid in respect of the assessment year relevant to that previous year and 20
subsequent assessment years and other provisions of the Act shall apply, as if the
option had not been exercised for the assessment year relevant to that previous year
and subsequent assessment years.
(2) For the purposes of sub-section (1), the total income of the co-operative society
shall be computed,— 25
(i) without any deduction under the provisions of section 10AA or clause (iia) of
sub-section (1) of section 32 or section 32AD or section 33AB or section 33ABA or
sub-clause (ii) or sub-clause (iia) or sub-clause (iii) of sub-section (1) or
sub-section (2AA) of section 35 or section 35AD or section 35CCC or under any of
the provisions of Chapter VI-A other than the provisions of section 80JJAA; 30
(ii) without set off of any loss carried forward or depreciation from any earlier
assessment year, if such loss or depreciation is attributable to any of the deductions
referred to in clause (i); and
(iii) by claiming the depreciation, if any, under section 32, other than clause (iia)
of sub-section (1) of the said section, determined in such manner as may be 35
prescribed.
(3) The loss and depreciation referred to in clause (ii) of sub-section (2) shall be
deemed to have been given full effect to and no further deduction for such loss or
depreciation shall be allowed for any subsequent year:
Provided that where there is a depreciation allowance in respect of a block of asset 40

which has not been given full effect to prior to the assessment year beginning on the
1st day of April, 2021, corresponding adjustment shall be made to the written down
value of such block of assets as on the 1st day of April, 2020 in such manner as may
be prescribed, if the option under sub-section (5) is exercised for a previous year
relevant to the assessment year beginning on the 1st day of April, 2021. 45
(4) In case of a person, having a Unit in the International Financial Services Centre,
as referred to in sub-section (1A) of section 80LA, which has exercised option under
sub-section (5), the conditions contained in sub-section (2) shall be modified to the
extent that the deduction under the said section shall be available to such Unit subject
to fulfilment of the conditions contained in that section. 50
Explanation.—For the purposes of this sub-section, the term “Unit” shall have the
28 of 2005. meaning assigned to it in clause (zc) of section 2 of the Special Economic Zones Act, 2005.
(5) Nothing contained in this section shall apply unless option is exercised by the
person in such manner as may be prescribed on or before the due date specified under
sub-section (1) of section 139 for furnishing the return of income for any previous year 55
relevant to the assessment year commencing on or after the 1st day of April, 2021 and
such option once exercised shall apply to subsequent assessment years:
Provided that once the option has been exercised for any previous year, it cannot
be subsequently withdrawn for the same or any other previous year.'.
54. In section 115BBDA of the Income-tax Act,–– 60 Amendment

of section
115BBDA.
26

(a) in sub-section (1), for the words “or companies”, the words, figures and letters
“or companies on or before the 31st day of March, 2020” shall be substituted with
effect from the 1st day of April, 2021;
(b) in the Explanation, in clause (b), in sub-clause (iii), for the words, figures and
letters “under section 12A or section 12AA”, the words, figures and letters “under 5
section 12A or section 12AA or section 12AB” shall be substituted with effect from the
1st day of June, 2020.
Amendment 55. In section 115C of the Income-tax Act, in clause (c), the words, figures and letter
of section “other than dividends referred to in section 115-O” shall be omitted with effect from the
115C. 1st day of April, 2021. 10
Amendment 56. In section 115JB of the Income-tax Act, in sub-section (4), for the words, brackets
of section and figures “along with the return of income filed under sub-section (1) of section 139”,
115JB. the words, figures and letters “before the specified date referred to in section 44AB” shall
be substituted.
Amendment of 57. In section 115JC of the Income-tax Act,–– 15
section 115JC.
(i) in sub-section (3), for the portion beginning with the words “in such form” and
ending with the word and figures “section 139”, the words, figures and letters “before
the specified date referred to in section 44AB, in such form as may be prescribed, from
an accountant referred to in the Explanation below sub-section (2) of section 288,
certifying that the adjusted total income and the alternate minimum tax have been 20
computed in accordance with the provisions of this Chapter and furnish such report by
that date” shall be substituted;
(ii) after sub-section (4), the following sub-section shall be inserted, with effect from
the 1st day of April, 2021, namely:––
“(5) The provisions of this section shall not apply to a person who has exercised 25
the option referred to in section 115BAC or section 115BAD.”.
Amendment 58. In section 115JD of the Income-tax Act, after sub-section (6), the following
of section sub-section shall be inserted, with effect from the 1st day of April, 2021, namely:––
115JD.
“(7) The provisions of this section shall not apply to a person who has exercised the
option referred to in section 115BAC or section 115BAD.”. 30
Amendment 59. In section 115-O of the Income-tax Act, in sub-section (1), after the words, figures
of section and letters “on or after the 1st day of April, 2003”, the words, figures and letters “but on or
115-O. before the 31st day of March, 2020” shall be inserted with effect from the 1st day of
April, 2021.
Amendment 60. In section 115R of the Income-tax Act, in sub-section (2), after the words “or a 35
of section Mutual Fund to its unit holders”, the words, figures and letters “on or before the 31st day
115R. of March, 2020” shall be inserted with effect from the 1st day of April, 2021.
Amendment 61. In section 115TD of the Income-tax Act, for the words, figures and letters “under
of section section 12AA” wherever they occur, the words, figures and letters “under section 12AA or
115TD. section 12AB” shall be substituted with effect from the 1st day of June, 2020. 40
Amendment 62. In section 115UA of the Income-tax Act, in sub-section (3), the words, brackets and
of section letter “sub-clause (a) of” shall be omitted with effect from the 1st day of April, 2021.
115UA.
Amendment 63. In section 115VW of the Income-tax Act, in clause (ii), for the words “along with the
of section return of income for that previous year”, the words, figures and letters “before the
115VW. specified date referred to in section 44AB” shall be substituted. 45
Insertion of 64. After section 119 of the Income-tax Act, the following section shall be inserted,
new section namely:––
119A.
Taxpayer’s “119A. The Board shall adopt and declare a Taxpayer’s Charter and issue such
Charter. orders, instructions, directions or guidelines to other income-tax authorities as it may
deem fit for the administration of such Charter.”. 50
Amendment 65. In section 133A of the Income-tax Act, after sub-section (6), for the proviso, the
of section following proviso shall be substituted, namely:—
133A.
“Provided that––
(a) in a case where the information has been received from such authority, as
may be prescribed, no action under sub-section (1) shall be taken by an Assistant 55
Director or a Deputy Director or an Assessing Officer or a Tax Recovery Officer or
an Inspector of Income-tax without obtaining the approval of the Joint Director or the
Joint Commissioner, as the case may be;
(b) in any other case, no action under sub-section (1) shall be taken by a Joint
Director or a Joint Commissioner or an Assistant Director or a Deputy Director or an 60
27

Assessing Officer or a Tax Recovery Officer or an Inspector of Income-tax without
obtaining the approval of the Director or the Commissioner, as the case may be.”.
66. In section 139 of the Income-tax Act, in sub-section (1), in Explanation 2, in Amendment of
clause (a),–– section 139.
5 (a) in sub-clause (iii), the word “working” shall be omitted;

(b) in the long line, for the figures, letters and words “30th day of September”, the
figures, letters and words “31st day of October” shall be substituted.
67. In section 140 of the Income-tax Act,–– Amendment
of section 140.
(i) in clause (c), after the words “by any director thereof”, the words “or any other
10 person, as may be prescribed for this purpose” shall be inserted;
(ii) in clause (cd), after the words “by any partner thereof”, the words “or any other
person, as may be prescribed for this purpose” shall be inserted.
68. In section 140A of the Income-tax Act, in sub-section (1),–– Amendment of
section 140A.
(a) in clause (iv), the word “and” occurring at the end shall be omitted;
15 (b) in clause (v), for the word, figures and letters “section 115JD,”, the words, figures
and letters “section 115JD; and” shall be substituted;
(c) after clause (v), the following clause shall be inserted, namely:––
“(vi) any tax or interest payable according to the provisions of sub-section (2) of
section 191,”.
20 69. In section 143 of the Income-tax Act,–– Amendment of

section 143.
(a) in sub-section (3A), after the word, brackets and figure “sub-section (3)”, the
words and figures “or section 144” shall be inserted;
(b) in sub-section (3B), in the proviso, for the figures, letters and words “31st day of
March, 2020”, the figures, letters and words “31st day of March, 2022” shall be
25 substituted.
70. In section 144C of the Income-tax Act,–– Amendment of
section 144C.
(a) in sub-section (1), the words “in the income or loss returned” shall be omitted;
(b) in sub-section (15), in clause (b), for sub-clause (ii), the following sub-clause
shall be substituted, namely:––
30 “(ii) any non-resident not being a company, or any foreign company.”.

71. Section 156 of the Income-tax Act shall be renumbered as sub-section (1) thereof Amendment
and after sub-section (1) as so renumbered, the following sub-section shall be inserted, of section
namely:–– 156.
“(2) Where the income of the assessee of any assessment year, beginning on or
35 after the 1st day of April, 2021, includes income of the nature specified in clause (vi) of
sub-section (2) of section 17 and such specified security or sweat equity shares
referred to in the said clause are allotted or transferred directly or indirectly by the
current employer, being an eligible start-up referred to in section 80-IAC, the tax or
interest on such income included in the notice of demand referred to in sub-section (1)
40 shall be payable by the assessee within fourteen days––
(i) after the expiry of forty-eight months from the end of the relevant assessment
year; or
(ii) from the date of the sale of such specified security or sweat equity share by
the assessee; or
45 (iii) from the date of the assessee ceasing to be the employee of the employer
who allotted or transferred him such specified security or sweat equity share,
whichever is the earliest.”.

72. Section 191 of the Income-tax Act shall be renumbered as sub-section (1) thereof Amendment
and after sub-section (1) as so renumbered, the following sub-section shall be inserted, of section
50 namely:–– 191.
“(2) For the purposes of paying income-tax directly by the assessee under
sub-section (1), if the income of the assessee in any assessment year, beginning on
or after the 1st day of April, 2021, includes income of the nature specified in clause (vi)
of sub-section (2) of section 17 and such specified security or sweat equity shares
28

referred to in the said clause are allotted or transferred directly or indirectly by the
current employer, being an eligible start-up referred to in section 80-IAC, the
income-tax on such income shall be payable by the assessee within fourteen days–
year; or 5
the assessee; or
(iii) from the date of the assessee ceasing to be the employee of the employer
who allotted or transferred him such specified security or sweat equity share,
whichever is the earliest.”. 10
Amendment of 73. In section 192 of the Income-tax Act, after sub-section (1B), the following
section 192. sub-section shall be inserted, namely:––
“(1C) For the purposes of deducting or paying tax under sub-section (1) or
sub-section (1A), as the case may be, a person, being an eligible start-up referred to in
section 80-IAC, responsible for paying any income to the assessee being perquisite of 15
the nature specified in clause (vi) of sub-section (2) of section 17 in any previous year
relevant to the assessment year, beginning on or after the 1st day of April, 2021, shall
deduct or pay, as the case may be, tax on such income within fourteen days––
year; or 20
the assessee; or
(iii) from the date of the assessee ceasing to be the employee of the person,
whichever is the earliest, on the basis of rates in force for the financial year in which
the said specified security or sweat equity share is allotted or transferred.”. 25
Amendment of 74. In section 194 of the Income-tax Act,––
section 194.
(A) for the words “in cash or before issuing any cheque or warrant”, the words “by
any mode” shall be substituted;
(B) for the words “at the rates in force”, the words “at the rate of ten per cent.” shall
be substituted; 30
(C) in the first proviso,––
(i) in clause (a), for the words “an account payee cheque”, the words “any mode
other than cash” shall be substituted;
(ii) in clause (b), for the words “two thousand five hundred rupees”, the words
“five thousand rupees” shall be substituted; 35
(D) the third proviso shall be omitted.
Amendment of 75. In section 194A of the Income-tax Act,––

section 194A.
(I) in sub-section (1), in the proviso, for the words, brackets, letters and figures “the
monetary limits specified under clause (a) or clause (b) of section 44AB”, the words
“one crore rupees in case of business or fifty lakh rupees in case of profession” shall 40
be substituted;
(II) in sub-section (3),––
(A) in clause (i), the Explanation shall be omitted;
(B) after clause (xi) and before Explanation 1, the following proviso shall be
inserted, namely:–– 45
“Provided that a co-operative society referred to in clause (v) or clause (viia)

shall be liable to deduct income-tax in accordance with the provisions of
sub-section (1), if––
(a) the total sales, gross receipts or turnover of the co-operative society
exceeds fifty crore rupees during the financial year immediately preceding the 40
financial year in which the interest referred to in sub-section (1) is credited or
paid; and
(b) the amount of interest, or the aggregate of the amounts of such interest,
credited or paid, or is likely to be credited or paid, during the financial year is
29

more than fifty thousand rupees in case of payee being a senior citizen and
forty thousand rupees in any other case.”;
(C) after Explanation 1, the following Explanation shall be inserted, namely:––
‘Explanation 2.–– For the purposes of this sub-section, “senior citizen” means
5 an individual resident in India who is of the age of sixty years or more at any time
during the relevant previous year.’.
76. In section 194C of the Income-tax Act, in the Explanation,–– Amendment of
section 194C.
(I) in clause (i), in sub-clause (l), in item (B), for the words, brackets, letters and
figures “is liable to audit of accounts under clause (a) or clause (b) of section 44AB”,
10 the words “has total sales, gross receipts or turnover from business or profession
carried on by him exceeding one crore rupees in case of business or fifty lakh rupees
in case of profession” shall be substituted;
(II) in clause (iv),––
(i) for sub-clause (e), the following sub-clause shall be substituted, namely:––
15 “(e) manufacturing or supplying a product according to the requirement or

specification of a customer by using material purchased from such customer or
its associate, being a person placed similarly in relation to such customer as is
the person placed in relation to the assessee under the provisions contained in
clause (b) of sub-section (2) of section 40A,”;
20 (ii) in the long line, after the words “other than such customer”, the words “or
associate of such customer” shall be inserted.
77. In section 194H of the Income-tax Act, in the second proviso, for the words, Amendment
brackets, letters and figures “the monetary limits specified under clause (a) or clause (b) of section
of section 44AB”, the words “one crore rupees in case of business or fifty lakh rupees in 194H.
25 case of profession” shall be substituted.
78. In section 194-I of the Income-tax Act, in the second proviso, for the words, Amendment
brackets, letters and figures “the monetary limits specified under clause (a) or clause (b) of section
of section 44AB”, the words “one crore rupees in case of business or fifty lakh rupees in 194-I.
case of profession” shall be substituted.
30 79. In section 194J of the Income-tax Act, in sub-section (1),–– Amendment of

section 194J.
(a) in the long line, for the words “ten per cent. of such sum”, the words and brackets
“two per cent. of such sum in case of fees for technical services (not being a professional
service) and ten per cent. of such sum in other cases,” shall be substituted;
(b) in the second proviso, for the words, brackets, letters and figures “the monetary
35 limits specified under clause (a) or clause (b) of section 44AB”, the words “one crore
rupees in case of business or fifty lakh rupees in case of profession” shall be
substituted.
80. After section 194J of the Income-tax Act, the following section shall be inserted, Insertion of new
namely:– section 194K.
40 ‘194K. Any person responsible for paying to a resident any income in respect of–– Income in
respect of units.
(a) units of a Mutual Fund specified under clause (23D) of section 10; or
(b) units from the Administrator of the specified undertaking; or
(c) units from the specified company,
shall, at the time of credit of such income to the account of the payee or at the time of
45 payment thereof by any mode, whichever is earlier, deduct income-tax thereon at the
rate of ten per cent.:
Provided that the provisions of this section shall not apply where the amount of
such income or, as the case may be, the aggregate of the amounts of such income
credited or paid or likely to be credited or paid during the financial year by the person
50 responsible for making the payment to the account of, or to, the payee does not
exceed five thousand rupees.
Explanation 1.—For the purposes of this section,—
(a ) “Administrator” means the Administrator as referred to in clause (a) of
58 of 2002. section 2 of the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002;
55 (b) “specified company” means a company as referred to in clause (h) of
58 of 2002. section 2 of the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002;
30

(c) “specified undertaking” shall have the meaning assigned to it in clause (i) of
section 2 of the Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002. 58 of 2002.
Explanation 2.––For the removal of doubts, it is hereby clarified that where any
income referred to in this section is credited to any account, whether called
"suspense account" or by any other name, in the books of account of the person 5
liable to pay such income, such crediting shall be deemed to be the credit of such
income to the account of the payee and the provisions of this section shall apply
accordingly.’.
Amendment 81. In section 194LBA of the Income-tax Act,––
of section
194LBA.
(a) the words, brackets and letter “sub-clause (a) of” at both the places where they 10
occur shall be omitted;
(b) in sub-section (2), for the words “five per cent.”, the words, brackets and letters
“five per cent. in case of income of the nature referred to in sub-clause (a) and ten per
cent. in case of income of the nature referred to in sub-clause (b), of the said clause”
shall be substituted. 15
Amendment 82. In section 194LC of the Income-tax Act,––
of section
194LC.
(i) in sub-section (1), the following proviso shall be inserted, namely:––
“Provided that in case of income by way of interest referred to clause (ib) of
sub-section (2), the income-tax shall be deducted at the rate of four per cent.”;
(ii) in sub-section (2),–– 20
(a) in clause (i), in sub-clause (a) and sub-clause (c), for the figures “2020”, the
figures “2023” shall be substituted;
(b) in clause (ia), for the figures and word “2020, and”, the figures and word
“2023, or” shall be substituted;
(c) after clause (ia), the following clause shall be inserted, namely:–– 25
“(ib) in respect of monies borrowed by it from a source outside India by way of

issue of any long-term bond or rupee denominated bond on or after the 1st day
of April, 2020 but before the 1st day of July, 2023, which is listed only on a
recognised stock exchange located in any International Financial Services
Centre, and”; 30
(iii) in the Explanation, after clause (b), the following clauses shall be inserted,
namely:––
‘(c) “International Financial Services Centre" shall have the meaning assigned to
it in clause (q) of section 2 of the Special Economic Zones Act, 2005; 28 of 2005.
(d) “recognised stock exchange” shall have the meaning assigned to it in 35

clause (ii) of Explanation 1 to clause (5) of section 43.’.
Amendment of 83. In section 194LD of the Income-tax Act,––

section 194LD.
(i) for sub-section (2), the following sub-section shall be substituted, namely:––
“(2) The income by way of interest referred to in sub-section (1) shall be the
interest payable,–– 40
(a) on or after the 1st day of June, 2013 but before the 1st day of July, 2023 in
respect of the investment made by the payee in ––
(i) a rupee denominated bond of an Indian company; or
(ii) a Government security;
(b) on or after the 1st day of April, 2020 but before the 1st day of July, 2023 in 45
respect of the investment made by the payee in municipal debt securities:
Provided that the rate of interest in respect of bond referred to in sub-clause (i)
of clause (a) shall not exceed the rate as the Central Government may, by
notification in the Official Gazette, specify.";
(ii) in the Explanation, after clause (b), the following clause shall be inserted, 50
namely:––
‘(ba) “municipal debt securities” shall have the meaning assigned to it in

clause (m) of sub-regulation (1) of regulation 2 of the Securities and Exchange
31

Board of India (Issue and Listing of Municipal Debt Securities) Regulations, 2015
15 of 1992. made under the Securities and Exchange Board of India Act, 1992;’.
84. After section 194N of the Income-tax Act, the following section shall be inserted, Insertion of
namely:–– new section
194-O.
5 ‘194-O. (1) Notwithstanding anything to the contrary contained in any of the Payment of
provisions of Part B of this Chapter, where sale of goods or provision of services of an certain sums
e-commerce participant is facilitated by an e-commerce operator through its digital or by
electronic facility or platform (by whatever name called), such e-commerce operator e-commerce
shall, at the time of credit of amount of sale or services or both to the account of an operator to
10 e-commerce participant or at the time of payment thereof to such e-commerce e-commerce
participant by any mode, whichever is earlier, deduct income-tax at the rate of one per participant.
cent. of the gross amount of such sales or services or both.
Explanation.––For the purposes of this sub-section, any payment made by a
purchaser of goods or recipient of services directly to an e-commerce participant for
15 the sale of goods or provision of services or both, facilitated by an e-commerce
operator, shall be deemed to be the amount credited or paid by the e-commerce
operator to the e-commerce participant and shall be included in the gross amount of
such sale or services for the purpose of deduction of income-tax under this sub-
section.
20 (2) No deduction under sub-section (1) shall be made from any sum credited or paid
or likely to be credited or paid during the previous year to the account of an
e-commerce participant, being an individual or Hindu undivided family, where the
gross amount of such sale or services or both during the previous year does not
exceed five lakh rupees and such e-commerce participant has furnished his
25 Permanent Account Number or Aadhaar number to the e-commerce operator.
(3) Notwithstanding anything contained in Part B of this Chapter, a transaction in
respect of which tax has been deducted by the e-commerce operator under
sub-section (1), or which is not liable to deduction under sub-section (2), shall not be
liable to tax deduction at source under any other provision of this Chapter:
30 Provided that the provisions of this sub-section shall not apply to any amount or
aggregate of amounts received or receivable by an e-commerce operator for hosting
advertisements or providing any other services which are not in connection with the
sale or services referred to in sub-section (1).
Explanation.––For the purposes of this section,––
35 (a) “electronic commerce” means the supply of goods or services or both,

including digital products, over digital or electronic network;
(b) “e-commerce operator” means a person who owns, operates or manages
digital or electronic facility or platform for electronic commerce and is responsible for
paying to e-commerce participant;
40 (c) “e-commerce participant” means a person resident in India selling goods or

providing services or both, including digital products, through digital or electronic
facility or platform for electronic commerce;
(d) “services” includes ‘fees for technical services’ and fees for ‘professional
services’, as defined in the Explanation to section 194J.’.
45 85. In section 195 of the Income-tax Act, in sub-section (1), the second proviso shall be Amendment of
omitted. section 195.
86. In section 196A of the Income-tax Act, in sub-section (1),–– Amendment of

section 196A.
(a) for the words “of the Unit Trust of India”, the words, brackets and figures “from
the specified company referred to in the Explanation to clause (35) of section 10” shall
50 be substituted;
(b) for the words “in cash or by the issue of a cheque or draft or by any other mode”,
the words “ by any mode” shall be substituted;
(c) the proviso shall be omitted.
87. In section 196C of the Income-tax Act,–– Amendment of

section 196C.
55 (a) for the words “in cash or by the issue of a cheque or draft or by any other mode”,
the words “by any mode” shall be substituted;
(b) the proviso shall be omitted.
88. In section 196D of the Income-tax Act, in sub-section (1),–– Amendment of

section 196D.
32

(a) for the words “in cash or by the issue of a cheque or draft or by any other mode”,
the words “by any mode” shall be substituted;
(b) the proviso shall be omitted.
Amendment of 89. In section 197 of the Income-tax Act, in sub-section (1), for the figures and letter
section 197. “194M”, the figures and letters “194M, 194-O” shall be substituted. 5
Omission of 90. Section 203AA of the Income-tax Act shall be omitted with effect from the 1st day of
section 203AA. June, 2020.
Amendment of 91. In section 204 of the Income-tax Act, after clause (iv) and before the Explanation,
section 204. the following clause shall be inserted, namely:––
“(v) in the case of a person not resident in India, the person himself or any person 10
authorised by such person or the agent of such person in India including any person
treated as an agent under section 163.”.
Amendment 92. In section 206AA of the Income-tax Act, in sub-section (1), the following proviso
of section shall be inserted, namely:––
206AA.
‘Provided that where the tax is required to be deducted under section 194-O, the 15
provisions of clause (iii) shall apply as if for the words “twenty per cent.”, the words
“five per cent.” had been substituted.’.
Amendment of 93. In section 206C of the Income-tax Act,––
section 206C.
(I) after sub-section (1F), the following sub-sections shall be inserted, namely:––
'(1G) Every person,–– 20
(a) being an authorised dealer, who receives an amount, or an aggregate of

amounts, of seven lakh rupees or more in a financial year for remittance out of
India from a buyer, being a person remitting such amount out of India under the
Liberalised Remittance Scheme of the Reserve Bank of India;
(b) being a seller of an overseas tour program package, who receives any 25
amount from a buyer, being the person who purchases such package,
shall, at the time of debiting the amount payable by the buyer or at the time of receipt
of such amount from the said buyer, by any mode, whichever is earlier, collect from the
buyer, a sum equal to five per cent. of such amount as income-tax:
Provided that the provisions of this sub-section shall not apply, if the buyer is,–– 30
(i) liable to deduct tax at source under any other provision of this Act and has
deducted such amount;
(ii) the Central Government, a State Government, an embassy, a High

Commission, a legation, a commission, a consulate, the trade representation of a
foreign State, a local authority as defined in the Explanation to clause (20) 35
of section 10 or any other person as the Central Government may, by notification
in the Official Gazette, specify for this purpose, subject to such conditions as may
be specified therein.
Explanation.––For the purposes of this sub-section,––
(i) “authorised dealer” means a person authorised by the Reserve Bank of 40

India under sub-section (1) of section 10 of the Foreign Exchange
Management Act, 1999 to deal in foreign exchange or foreign security; 42 of 1999.
(ii) “overseas tour program package” means any tour package which offers
visit to a country or countries or territory or territories outside India and
includes expenses for travel or hotel stay or boarding or lodging or any other 45
expenditure of similar nature or in relation thereto.
(1H) Every person, being a seller, who receives any amount as consideration for
sale of any goods of the value or aggregate of such value exceeding fifty lakh
rupees in any previous year, other than the goods covered in sub-section (1) or
sub-section (1F) or sub-section (1G) shall, at the time of receipt of such amount, 50
collect from the buyer, a sum equal to 0.1 per cent. of the sale consideration
exceeding fifty lakh rupees as income-tax:
Provided that if the buyer has not provided the Permanent Account Number or
the Aadhaar number to the seller, then the provisions of clause (ii) of sub-section (1)
of section 206CC shall be read as if for the words “five per cent.”, the words “one 55
per cent.” had been substituted:
33

Provided further that the provisions of this sub-section shall not apply, if the
buyer is liable to deduct tax at source under any other provision of this Act and has
deducted such amount.
Explanation.––For the purposes of this sub-section,––
5 (a) “buyer” means a person who purchases any goods, but does not include,––
(A) the Central Government, a State Government, an embassy, a High

Commission, legation, commission, consulate and the trade representation of
a foreign State; or
(B) a local authority as defined in the Explanation to clause (20) of

15 section 10; or
(C) any other person as the Central Government may, by notification in the
Official Gazette, specify for this purpose, subject to such conditions as may be
specified therein;
(b) “seller” means a person whose total sales, gross receipts or turnover from the
20 business carried on by him exceed ten crore rupees during the financial year
immediately preceding the financial year in which the sale of goods is carried out, not
being a person as the Central Government may, by notification in the Official Gazette,
specify for this purpose, subject to such conditions as may be specified therein.';
(II) in sub-section (2), for the words, brackets, figures and letter “sub-section (1) or
25 sub-section (1C)”, the words “this section” shall be substituted;
(III) in sub-section (3), for the words, brackets, figures and letter “sub-section (1) or
sub-section (1C)”, the words “this section” shall be substituted;
(IV) in sub-section (6A), in the first proviso, for the words “in accordance with the
provisions of this section”, the words, brackets, figures and letter “in accordance with
30 the provisions of sub-section (1) and sub-section (1C)” shall be substituted;
(V) in the Explanation, in clause (c),––
(i) for the word “means”, the words, brackets, figures and letter “with respect to
sub-section (1) and sub-section (1F) means” shall be substituted;
(ii) for the words, brackets, letters and figures “the monetary limits specified
35 under clause (a) or clause (b) of section 44AB”, the words “one crore rupees in case
of business or fifty lakh rupees in case of profession” shall be substituted.
94. After section 234F of the Income-tax Act, the following section shall be inserted Insertion of
with effect from the 1st day of June, 2020, namely:–– new section
234G.
“234G. (1) Without prejudice to the provisions of this Act, where,–– Fee for default
relating to
40 (a) the research association, university, college or other institution referred to in statement or
clause (ii) or clause (iii) or the company referred to in clause (iia) of sub-section (1) certificate.
of section 35 fails to deliver or cause to be delivered a statement within the time
prescribed under clause (i), or furnish a certificate prescribed under clause (ii) of
sub-section (1A) of that section; or
45 (b) the institution or fund fails to deliver or cause to be delivered a statement

within the time prescribed under clause (viii) of sub-section (5) of section 80G, or
furnish a certificate prescribed under clause (ix) of the said sub-section,
it shall be liable to pay, by way of fee, a sum of two hundred rupees for every day during
which the failure continues.
50 (2) The amount of fee referred to in sub-section (1) shall,––
(a) not exceed the amount in respect of which the failure referred to therein has
occurred;
(b) be paid before delivering or causing to be delivered the statement or before

furnishing the certificate referred to in sub-section (1).”.
55 95. In section 250 of the Income-tax Act, after sub-section (6A), the following Amendment
sub-sections shall be inserted, namely:— of section 250.
“(6B) The Central Government may make a scheme, by notification in the Official
Gazette, for the purposes of disposal of appeal by Commissioner (Appeals), so as to
impart greater efficiency, transparency and accountability by—
34

(a) eliminating the interface between the Commissioner (Appeals) and the appellant
in the course of appellate proceedings to the extent technologically feasible;
(b) optimising utilisation of the resources through economies of scale and
functional specialisation;
(c) introducing an appellate system with dynamic jurisdiction in which appeal 5

shall be disposed of by one or more Commissioner (Appeals).
(6C) The Central Government may, for the purposes of giving effect to the scheme
made under sub-section (6B), by notification in the Official Gazette, direct that any of
the provisions of this Act relating to jurisdiction and procedure for disposal of appeals
by Commissioner (Appeals) shall not apply or shall apply with such exceptions, 15
modifications and adaptations as may be specified in the notification:
Provided that no direction shall be issued after the 31st day of March, 2022.
(6D) Every notification issued under sub-section (6B) and sub-section (6C) shall, as
soon as may be after the notification is issued, be laid before each House of Parliament.”.
Amendment 96. In section 253 of the Income-tax Act, in sub-section (1), in clause (c), for the words, 20
of section figures and letters “under section 12AA”, the words, figures and letters “under section
253. 12AA or section 12AB” shall be substituted with effect from the 1st day of June, 2020.
Amendment of 97. In section 254 of the Income-tax Act, in sub-section (2A),—
section 254.
(a) in the first proviso, after the words “from the date of such order”, the words
“subject to the condition that the assessee deposits not less than twenty per cent. of 25
the amount of tax, interest, fee, penalty, or any other sum payable under the provisions
of this Act, or furnishes security of equal amount in respect thereof” shall be inserted;
(b) for the second proviso, the following proviso shall be substituted, namely:––
“Provided further that no extension of stay shall be granted by the Appellate
Tribunal, where such appeal is not so disposed of within the said period of stay as 30
specified in the order of stay, unless the assessee makes an application and has
complied with the condition referred to in the first proviso and the Appellate Tribunal
is satisfied that the delay in disposing of the appeal is not attributable to the
assessee, so however, that the aggregate of the period of stay originally allowed
and the period of stay so extended shall not exceed three hundred and sixty-five 35
days and the Appellate Tribunal shall dispose of the appeal within the period or
periods of stay so extended or allowed:”.
Insertion of 98. After section 271AAC of the Income-tax Act, the following section shall be inserted,
new section namely:—
271AAD.
Penalty for ‘271AAD. (1) Without prejudice to any other provisions of this Act, if during any 40
false entry, 40 proceeding under this Act, it is found that in the books of account maintained by any
etc. in books person there is—
of account.
(i) a false entry; or
(ii) an omission of any entry which is relevant for computation of total income of
such person, to evade tax liability, 45

the Assessing Officer may direct that such person shall pay by way of penalty a sum
equal to the aggregate amount of such false or omitted entry.
(2) Without prejudice to the provisions of sub-section (1), the Assessing Officer may
direct that any other person, who causes the person referred to in sub-section (1) in
45 any manner to make a false entry or omits or causes to omit any entry referred to in 50
that sub-section, shall pay by way of penalty a sum equal to the aggregate amount of
such false or omitted entry.
Explanation.––For the purposes of this section, “false entry” includes use or

intention to use––
50 (a) forged or falsified documents such as a false invoice or, in general, a false 55
piece of documentary evidence; or
(b) invoice in respect of supply or receipt of goods or services or both issued by
the person or any other person without actual supply or receipt of such goods or
services or both; or
55 (c) invoice in respect of supply or receipt of goods or services or both to or from a

person who does not exist.’. 60
Insertion of new 99. After section 271J of the Income-tax Act, the following section shall be inserted with
section 271K. effect from the 1st day of June, 2020, namely:––
35

“271K. Without prejudice to the provisions of this Act, the Assessing Officer may Penalty for
direct that a sum not less than ten thousand rupees but which may extend to one lakh failure to furnish
rupees shall be paid by way of penalty by–– statements, etc.
(i) the research association, university, college or other institution referred to in

5 clause (ii) or clause (iii) or the company referred to in clause (iia), of sub-section (1)
of section 35, if it fails to deliver or cause to be delivered a statement within the time
prescribed under clause (i), or furnish a certificate prescribed under clause (ii) of
sub-section (1A) of that section; or
(ii) the institution or fund, if it fails to deliver or cause to be delivered a statement
10 within the time prescribed under clause (viii) of sub-section (5) of section 80G, or
furnish a certificate prescribed under clause (ix) of the said sub-section.”.
100. In section 274 of the Income-tax Act, after sub-section (2), the following Amendment
sub-sections shall be inserted, namely:— of section
274.
“(2A) The Central Government may make a scheme, by notification in the Official
15 Gazette, for the purposes of imposing penalty under this Chapter so as to impart
greater efficiency, transparency and accountability by—
(a) eliminating the interface between the Assessing Officer and the assessee in
the course of proceedings to the extent technologically feasible;
(b) optimising utilisation of the resources through economies of scale and
20 functional specialisation;
(c) introducing a mechanism for imposing of penalty with dynamic jurisdiction in
which penalty shall be imposed by one or more income-tax authorities.
(2B) The Central Government may, for the purposes of giving effect to the scheme
made under sub-section (2A), by notification in the Official Gazette, direct that any of the
25 provisions of this Act relating to jurisdiction and procedure for imposing penalty shall not
apply or shall apply with such exceptions, modifications and adaptations as may be
specified in the notification:
Provided that no direction shall be issued after the 31st day of March, 2022.
(2C) Every notification issued under sub-section (2A) and sub-section (2B) shall, as
30 soon as may be after the notification is issued, be laid before each House of Parliament.”.
101. After section 285BA of the Income-tax Act, the following section shall be inserted Insertion of
with effect from the 1st day of June, 2020, namely:–– new section
285BB.
‘285BB. The prescribed income-tax authority or the person authorised by such Annual
authority shall upload in the registered account of the assessee an annual information information
35 statement in such form and manner, within such time and alongwith such information, statement.
which is in the possession of an income-tax authority, as may be prescribed.
Explanation.––For the purposes of this section, “registered account” means the
electronic filing account registered by the assessee in designated portal, that is, the
web portal designated as such by the prescribed income-tax authority or the person
40 authorised by such authority.’.
102. In section 288 of the Income-tax Act, in sub-section (2), after clause (vii), the Amendment
following clause shall be inserted, namely:–– of section 288.
“(viii) any other person as may be prescribed.”.
103. In section 295 of the Income-tax Act, in sub-section (2), in clause (b),–– Amendment of
section 295.
45 (a) after sub-clause (ii), the following sub-clause shall be inserted with effect from
the 1st day of April, 2021, namely:-
“(iia) operations carried out in India by a non-resident;”;
(b) after sub-clause (iia) as so inserted, the following sub-clause shall be inserted
with effect from the 1st day of April, 2022, namely:––
50 “(iib) transactions or activities of a non-resident;”.
104. In the First Schedule to the Income-tax Act, in rule 5, after clause (c), the following Amendment
proviso shall be inserted, namely:–– of First
Schedule.
“Provided that any sum payable by the assessee under section 43B, which is added
back in accordance with clause (a) of this rule, shall be allowed as deduction in computing
55 the income under the said rule in the previous year in which such sum is actually paid.”.



ADMIN1: ADMIN2:
36

CHAPTER IV
INDIRECT TAXES
Customs
Amendment 105. In section 11 of the Customs Act, 1962 (hereinafter referred to as the Customs 52 of 1962.
of section 11. Act), in sub-section (2), in clause (f), for the words “gold or silver”, the words “gold, silver 5
or any other goods” shall be substituted.
Amendment 106. In section 28 of the Customs Act, for Explanation4, the following Explanation
of section 28. shallbe substituted and shall be deemed to have been substituted with effect from the
29th day of March, 2018, namely:––
“Explanation 4.—For the removal of doubts, it is hereby declared that notwithstanding 10

anything to the contrary contained in any judgment, decree or order of the Appellate
Tribunal or any Court or in any other provision of this Act or the rules or regulations made
thereunder, or in any other law for the time being in force, in cases where notice has been
issued for non-levy, short-levy, non-payment, short-payment or erroneous refund, prior to
the 29th day of March, 2018, being the date of commencement of the Finance Act, 2018, 15 13 of 2018.
such notice shall continue to be governed by the provisions of section 28 as it stood
immediately before such date.”.
Amendment 107. In section 28AAA of the Customs Act, in sub-section (1),––

of section
28AAA. (a) for the words “by such person”, the words “or any other law, or any scheme of
the Central Government, for the time being in force, by such person” shall be 20
substituted;
(b) after the words “the rules”, the words “or regulations” shall be inserted;
(c) in Explanation 1, for the words “with respect to”, the words, figures and letter “or
duty credit issued under section 51B, with respect to” shall be substituted.
Insertion of 108. After Chapter VA of the Customs Act, the following Chapter shall be inserted, 25
new Chapter namely:––
VAA.
‘CHAPTER VAA
ADMINISTRATIONOF RULES OF ORIGIN UNDER TRADE AGREEMENT
Procedure 28DA. (1) An importer making claim for preferential rate of duty, in terms of any
regarding trade agreement, shall,–– 30
claim of
preferential (i) make a declaration that goods qualify as originating goods for preferential rate
rate of duty. of duty under such agreement;
(ii) possess sufficient information as regards the manner in which country of

origin criteria, including the regional value content and product specific criteria,
specified in the rules of origin in the trade agreement, are satisfied; 35
(iii) furnish such information in such manner as may be provided by rules;
(iv) exercise reasonable care as to the accuracy and truthfulness of the

information furnished.
(2) The fact that the importer has submitted a certificate of origin issued by an
Issuing Authority shall not absolve the importer of the responsibility to exercise 40
reasonable care.
(3) Where the proper officer has reasons to believe that country of origin criteria has
not been met, he may require the importer to furnish further information, consistent
with the trade agreement, in such manner as may be provided by rules.
(4) Where importer fails to provide the requisite information for any reason, the 45
proper officer may,––
(i) cause further verification consistentwith the trade agreement in such manner
as may be provided by rules;
(ii) pending verification, temporarily suspend the preferential tariff treatment to

such goods: 50
37

Provided that on the basis of the information furnished by the importer or the
information available with him or on the relinquishment of the claim for preferential rate
of duty by the importer, the Principal Commissioner of Customs or the Commissioner
of Customs may, for reasons to be recorded in writing, disallow the claim for
5 preferential rate of duty, without further verification.
(5) Where the preferential rate of duty is suspended under sub-section (4), the
proper officer may, on the request of the importer, release the goods subject to
furnishing by the importer a security amount equal to the difference between the duty
provisionally assessed under section 18 and the preferential duty claimed:
10 Provided that the Principal Commissioner of Customs or the Commissioner of

Customs may, instead of security, require the importer to deposit the differential duty
amount in the ledger maintained under section 51A.
(6) Upon temporary suspension of preferential tariff treatment, the proper officer
shall inform the Issuing Authority of reasons for suspension of preferential tariff
15 treatment, and seek specific information as may be necessary to determine the origin
of goods within such time and in such manner as may be provided by rules.
(7) Where, subsequently, the Issuing Authority or exporter or producer, as the case
may be, furnishes the specific information within the specified time, the proper officer
may, on being satisfied with the information furnished, restore the preferential tariff
20 treatment.
(8) Where the Issuing Authority or exporter or producer, as the case may be, does
not furnish information within the specified time or the information furnished by him is
not found satisfactory, the proper officer shall disallow the preferential tariff treatment
for reasons to be recorded in writing:
25 Provided that in case of receipt of incomplete or non-specific information, the proper

officer may send another request to the Issuing Authority stating specifically the
shortcoming in the information furnished by such authority, in such circumstances and
in such manner as may be provided by rules.
(9) Unless otherwise specified in the trade agreement, any request for verification
30 shall be sent within a period of five years from the date of claim of preferential rate of
duty by an importer.
(10)Notwithstanding anything contained in this section, the preferential tariff treatment

may be refused without verification in the following circumstances, namely:––
(i) the tariff item is not eligible for preferential tariff treatment;
35 (ii) complete description of goods is not contained in the certificate of origin;
(iii) any alteration in the certificate of origin is not authenticated by the Issuing
Authority;
(iv) the certificate of origin is produced after the period of its expiry,
and in all such cases,the certificate of origin shall be marked as ‘‘INAPPLICABLE’’.

40 (11) Where the verification under this section establishes non-compliance of the
imported goods with the country of origin criteria, the proper officer may reject the
preferential tariff treatment to the imports of identical goods from the same producer or
exporter, unless sufficient information is furnished to show that identical goods meet
the country of origin criteria.
45 Explanation.––For the purposes of this Chapter,––
(a) “certificate of origin” means a certificate issued in accordance with a trade

agreement certifying that the goods fulfill the country of origin criteria and other
requirements specified in the said agreement;
(b) “identical goods” means goods that are same in all respects with reference to
50 the country of origin criteria under the trade agreement;
(c) “Issuing Authority” means any authority designated for the purposes of issuing
certificate of origin under a trade agreement;
(d) “trade agreement” means an agreement for trade in goods between the
Government of India and the Government of a foreign country or territory or
55 economic union.’.
109. In Chapter VIIA of the Customs Act, in the heading, after the word “LEDGER”, the Amendment
words “AND ELECTRONIC DUTY CREDIT LEDGER” shall be inserted. of heading of
Chapter VIIA.
110. After section 51A of the Customs Act, the following section shall be inserted, Insertion of
namely:–– new section
51B.
60 “51B. (1)The Central Government may, by notification in the Official Gazette, specify Ledger for
the manner in which it shall issue duty credit,–– duty credit.
38

(a) in lieu of remission of any duty or tax or levy, chargeable on any material
used in the manufacture or processing of goods or for carrying out any operation on
such goods in India that are exported; or
(b) in lieu of such other financial benefit subject to such conditions and
5
restrictions as may be specified therein.
(2) The duty credit issued under sub-section (1) shall be maintained in the customs
automated system in the form of an electronic duty credit ledger of the person who is
the recipient of such duty credit, in such manner as may be prescribed.
(3) The duty credit available in the electronic duty credit ledger may be used by the 10
person to whom it is issued or the person to whom it is transferred, towards making
payment of duties payable under this Act or under the Customs Tariff Act, 1975 in 51 of 1975.
such manner and subject to such conditions and restrictions and within such time as
may be prescribed.”.
Amendment 111. In section 111 of the Customs Act, after clause (p), the following clause shall be 15
of section inserted, namely:––
111.
“(q) any goods imported on a claim of preferential rate of duty which contravenes
any provision of Chapter VAA or any rule made thereunder.".
Amendment 112. In section 156 of the Customs Act, in sub-section (2), after clause (h), the
of section following clause shall be inserted, namely:–– 20
156.
“(i) the form, time limit, manner, circumstances, conditions, restrictions and such
other matters for carrying out the provisions of Chapter VAA.”.
Amendment 113. In section 157 of the Customs Act, in sub-section (2), after clause (j), the following
of section clause shall be inserted, namely:––
157.
“(ja) the manner of maintaining electronic duty credit ledger, making payment from 25
such ledger, transfer of duty credit from ledger of one person to the ledger of another
and the conditions, restrictions and time limit relating thereto;”.
Customs Tariff
Substitution of 114. For section 8B of the Customs Tariff Act, 1975 (hereinafter referred to as the 51 of 1975.
new section Customs Tariff Act), the following section shall be substituted, namely:–– 30
for section 8B.
Power of ‘8B. (1) If the Central Government, after conducting such enquiry as it deems fit, is
Central satisfied that any article is imported into India in such increased quantity and under
Government such conditions so as to cause or threaten to cause serious injury to domestic industry,
to apply it may, by notification in the Official Gazette, apply such safeguard measures on that
safeguard article, as it deems appropriate. 35
measures.
(2) The safeguard measures referred to in sub-section (1) shall include imposition of
safeguard duty, application of tariff-rate quota or such other measure,as the Central
Government may consider appropriate, to curb the increased quantity of imports of an
article to prevent serious injury to domestic industry:
Provided that no such measure shall be applied on an article originating from a 40

developing country so long as the share of imports of that article from that country
does not exceed three per cent. or where the article is originating from more than one
developing country, then, so long as the aggregate of the imports from each of such
developing countries with less than three per cent. import share taken together, does
not exceed nine per cent. of the total imports of that article into India: 45
Provided further that the Central Government may, by notification in the Official
Gazette, exempt such quantity of any article as it may specify in the notification, when
imported from any country or territory into India, from payment of the whole or part of
the safeguard duty leviable thereon.
(3) Where tariff-rate quota is used as a safeguard measure, the Central 50

Government shall not fix such quota lower than the average level of imports in the last
three representative years for which statistics are available, unless a different level is
deemed necessary to prevent or remedy serious injury.
(4) The Central Government may allocate such tariff-rate quota to supplying
countries having a substantial interest in supplying the article concerned, in such 55
manner as may be provided by rules.
(5) The Central Government may, pending the determination under

sub-section (1), apply provisional safeguard measures under this sub-section on the
39

basis of a preliminary determination that increased imports have caused or threatened
to cause serious injury to a domestic industry:
Provided that where, on final determination, the Central Government is of the

opinion that increased imports have not caused or threatened to cause serious injury
5 to a domestic industry, it shall refund the safeguard duty so collected:
Provided further that any provisional safeguard measure shall not remain in force
for more than two hundred days from the date on which it was applied.
(6) Notwithstanding anything contained in the foregoing sub-sections, a

notification issued under sub-section (1) or any safeguard measures applied under
10 sub-sections (2), (3), (4) and (5), 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;
(ii)such article is either cleared as such into the domestic tariff area or used in the
15 manufacture of any goods that are cleared into the domestic tariff area, in which
case, safeguard measures shall be applied on the portion of the article so cleared or
used, as was applicable when it was imported into India.
Explanation.––For the purposes of this section, the expressions “hundred

per cent. export-oriented undertaking”, and “special economic zone” shall have the
20 same meaning as assigned to them in Explanation 2 to sub-section (1) of section 3
1 of 1944. of the Central Excise Act, 1944.
(7)The safeguard duty imposed under this section shall be in addition to any other
duty imposed under this Act or under any other law for the time being in force.
(8)The safeguard measures applied under this section shall, unless revoked earlier,
25 cease to have effect on the expiry of four years from the date of such application:
Provided that if the Central Government is of the opinion that the domestic industry
has taken measures to adjust to such injury or threat thereof and it is necessary that
the safeguard measures should continue to be applied, it may extend the period of
such application:
30 Provided further that in no case the safeguard measures shall continue to be

applied beyond a period of ten years from the date on which such measures were first
applied.
52 of 1962. (9)The provisions of the Customs Act, 1962 and the rules and regulations made
thereunder, including those relating to the date for determination of rate of duty,
35 assessment, non-levy, short-levy, refunds, interest, appeals, offences and penalties
shall, as far as may be, apply to the duty chargeable under this section as they apply
in relation to duties leviable under that Act.
(10)The Central Government may, by notification in the Official Gazette, make rules
for the purposes of this section, and without prejudice to the generality of the foregoing
40 power, such rules may provide for––
(i) the manner in which articles liable for safeguard measures may be identified;
(ii) the manner in which the causes of serious injury or causes of threat of serious
injury in relation to identified article may be determined;
(iii) the manner of assessment and collection of safeguard duty;
45 (iv) the manner in which tariff-rate quota on identified article may be allocated
among supplying countries;
(v) the manner of implementing tariff-rate quota as a safeguard measure;
(vi) any other safeguard measure and the manner of its application.
(11)For the purposes of this section,––
50 (a)“developing country” means a country notified by the Central Government in

the Official Gazette;
(b)“domestic industry” means the producers––
(i)as a whole of the like article or a directly competitive article in India; or
(ii)whose collective output of the like article or a directly competitive article in

55 India constitutes a major share of the total production of the said article in India;
40

(c) “serious injury” means an injury causing significant overall impairment in the
position of a domestic industry;
(d) “threat of serious injury” means a clear and imminent danger of serious injury.
(12) Every notification issued under this section shall be laid, as soon as may be
after it is issued, before each House of Parliament, while it is in session, for a total 5
period of thirty days which may be comprised in one session or in two or more
successive sessions, and if, before the expiry of the session immediately following the
session or the successive sessions aforesaid, both Houses agree in making any
modification in the notification or both Houses agree that the notification should not be
issued, the notification shall thereafter have effect only in such modified form or be of 10
no effect, as the case may be; so, however, that any such modification or annulment
shall be without prejudice to the validity of anything previously done under that
notification.’.
Amendment 115. In the Customs Tariff Act, the First Schedule shall––
of First
Schedule. (a) be amended in the manner specified in the Second Schedule; and 15
(b) be also amended in the manner specified in the Third Schedule.
Central Goods and Services Tax
Amendment 116. In section 2 of the Central Goods and Services Tax Act, 2017 (hereinafter referred 12 of 2017.
of section 2. to as the Central Goods and Services Tax Act), in clause (114), for clauses (c) and (d),
the following clauses shall be substituted, namely:–– 20
“(c) Dadra and Nagar Haveli and Daman and Diu;
(d) Ladakh;”.
Amendment 117. In section 10 of the Central Goods and Services Tax Act, in sub-section (2), in
of section 10. clauses (b), (c) and (d), after the words “of goods”, the words “or services” shall be
inserted. 25
Amendment 118. In section 16 of the Central Goods and Services Tax Act, in sub-section (4), the
of section 16. words “invoice relating to such” shall be omitted.
Amendment 119. In section 29 of the Central Goods and Services Tax Act, in sub-section (1), for
of section 29. clause (c), the following clause shall be substituted, namely:––
“(c) the taxable person is no longer liable to be registered under section 22 or 30

section 24 or intends to opt out of the registration voluntarily made under
sub-section (3) of section 25:”.
of section 30. the proviso, the following proviso shall be substituted, namely:––
“Provided that such period may, on sufficient cause being shown, and for reasons to 35
be recorded in writing, be extended,––
(a) by the Additional Commissioner or the Joint Commissioner, as the case may
be, for a period not exceeding thirty days;
(b) by the Commissioner, for a further period not exceeding thirty days, beyond
the period specified in clause (a).”. 40
of section 31. the proviso, the following proviso shall be substituted, namely:––
“Provided that the Government may, on the recommendations of the Council, by

notification,––
(a) specify the categories of services or supplies in respect of which a tax invoice 45
shall be issued, within such time and in such manner as may be prescribed;
(b) subject to the condition mentioned therein, specify the categories of services
in respect of which––
(i) any other document issued in relation to the supply shall be deemed to be a
50
tax invoice; or
(ii) tax invoice may not be issued.”.
Amendment 122. In section 51 of the Central Goods and Services Tax Act,––
of section 51. (a) for sub-section (3), the following sub-section shall be substituted, namely:––
41

“(3) A certificate of tax deduction at source shall be issued in such form and in such
manner as may be prescribed.”.
(b) sub-section (4) shall be omitted.”.
123. In section 109 of the Central Goods and Services Tax Act, in sub-section (6),–– Amendment
of section
109.
5 (a) the words “except for the State of Jammu and Kashmir” shall be omitted;
(b) the first proviso shall be omitted.
124. In section 122 of the Central Goods and Services Tax Act, after sub-section (1), Amendment
the following sub-section shall be inserted, namely:–– of section
122.
“(1A) Any person who retains the benefit of a transaction covered under clauses (i),
10 (ii), (vii) or clause (ix) of sub-section (1)and at whose instance such transaction is
conducted, shall be liable to a penalty of an amount equivalent to the tax evaded or
input tax credit availed of or passed on.”.
125. In section 132 of the Central Goods and Services Tax Act, in sub-section (1),–– Amendment
of section
(i)for the words “Whoever commits any of the following offences”, the words 132.
15 “Whoever commits, or causes to commit and retain the benefits arising out of, any of
the following offences’’ shall be substituted;
(ii) for clause (c), the following clause shall be substituted, namely:––
“(c) avails input tax credit using the invoice or bill referred to in clause (b) or
fraudulently avails input tax credit without any invoice or bill;”;
20 (iii) in sub-clause (e), the words “, fraudulently avails input tax credit” shall be
omitted.
126. In section 140 of the Central Goods and Services Tax Act, with effect from the 1st Amendment
day of July, 2017,–– of section
140.
(a) in sub-section (1), after the words “existing law”, the words “within such time
25 and” shall be inserted and shall be deemed to have been inserted;
(b) in sub-section (2), after the words “appointed day”, the words “within such time
and” shall be inserted and shall be deemed to have been inserted;
(c) in sub-section (3), for the words “goods held in stock on the appointed day
subject to”, the words “goods held in stock on the appointed day, within such time and
30 in such manner as may be prescribed, subject to” shall be substituted and shall be
deemed to have been substituted;
(d) in sub-section (5), for the words “existing law”, the words “existing law, within
such time and in such manner as may be prescribed” shall be substituted and shall be
35 (e) in sub-section (6), for the words “goods held in stock on the appointed day
subject to”, the words “goods held in stock on the appointed day, within such time and
in such manner as may be prescribed, subject to” shall be substituted and shall be
(f) in sub-section (7), for the words “credit under this Act even if”, the words “credit
40 under this Act, within such time and in such manner as may be prescribed, even if”
shall be substituted and shall be deemed to have been substituted;
(g) in sub-section (8), for the words “in such manner”, the words “within such time
and in such manner” shall be substituted and shall be deemed to have been
substituted;
45 (h) in sub-section (9), for the words “credit can be reclaimed subject to”, the words
“credit can be reclaimed within such time and in such manner as may be prescribed,
subject to” shall be substituted and shall be deemed to have been substituted.
127. In section 168 of the Central Goods and Services Tax Act, in sub-section (2), for Amendment
the words, brackets and figures “sub-section (5) of section 66, sub-section (1) of section of section
50 143”, the words, brackets and figures “sub-section (1) of section 143, except the second 168.
proviso thereof” shall be substituted.
128. In section 172 of the Central Goods and Services Tax Act, in sub-section (1), in Amendment of
the proviso, for the words “three years”, the words “five years” shall be substituted. section 172.
129. In Schedule II to the Central Goods and Services Tax Act, in paragraph 4, the words Amendment
“whether or not for a consideration,” at both the places where they occur, shall be omitted to Schedule II.
and shall be deemed to have been omitted with effect from the 1st day of July, 2017.
42

Retrospective 130. (1) Notwithstanding anything contained in the notification of the Government of
exemption India in the Ministry of Finance (Department of Revenue) number G.S.R. 673(E), dated
from, or levy the 28th June, 2017, issued by the Central Government, on the recommendations of the
or collection Council, in exercise of the powers under sub-section (1) of section 9 of the Central Goods
of, central tax and Services Tax Act, 2017,–– 5 12 of 2017.
in certain
cases.
(i) no central tax shall be levied or collected in respect of supply of fishmeal (falling
under heading 2301), during the period commencing from the 1st day of July, 2017
and ending with the 30th day of September, 2019 (both days inclusive);
(ii) central tax at the rate of six per cent. shall be levied or collected in respect of
supply of pulley, wheels and other parts (falling under heading 8483) and used as 10
parts of agricultural machinery (falling under headings 8432, 8433 and 8436), during
the period commencing from the 1st day of July, 2017 and ending with the 31stday of
December, 2018 (both days inclusive).
(2) No refund shall be made of all such tax which has been collected, but which would not
have been so collected, had sub-section (1) been in force at all material times. 15
Retrospective 131. The notification of the Government of India in the Ministry of Finance (Department
effect to of Revenue) number G.S.R. 708(E), dated the 30th September, 2019, issued by the
notification Central Government, on the recommendations of the Council, in exercise of the powers
issued under under clause (ii) of the proviso to sub-section (3) of section 54 of the Central Goods and
clause (ii) of
proviso to sub-
Services Tax Act, 2017, read with sub-section (2) of section 9 of the Goods and Services 20 12 of 2017.
Tax (Compensation to States) Act, 2017, shall be deemed to have, and always to have, 15 of 2017.
section (3) of
section 54 of for all purposes, come into force on and from the 1st day of July, 2017.
Central Goods
and Services
Tax Act.
Amendment 132. In section 25 of the Integrated Goods and Services Tax Act, 2017, in 13 of 2017.
of section 25. sub-section (1), in the proviso, for the words “three years”, the words “five years” shall be 25
substituted.
Retrospective 133. (1) Notwithstanding anything contained in the notification of the Government of
exemption India in the Ministry of Finance (Department of Revenue) number G.S.R. 666(E), dated
from, or levy the 28th June, 2017, issued by the Central Government, on the recommendations of the
or collection Council, in exercise of the power under sub-section (1) of section 5 of the Integrated 30
of, integrated Goods and Services Tax Act, 2017,–– 13 of 2017.
tax in certain
cases.
(i) no integrated tax shall be levied or collected in respect of supply of fishmeal
(falling under heading 2301), during the period commencing from the 1st day of July,
2017 and ending with the 30th day of September, 2019 (both days inclusive);
(ii) integrated tax at the rate of twelve per cent. shall be levied or collected in 35
respect of supply of pulley, wheels and other parts (falling under heading 8483) and
used as parts of agricultural machinery (falling under headings 8432, 8433 and 8436),
during the period commencing from the 1st day of July, 2017 and ending with the 31st
day of December, 2018 (both days inclusive).
(2) No refund shall be made of all such tax which has been collected, but which would not 40
have been so collected, had sub-section (1) been in force at all material times.
Union Territory Goods and Services Tax
Amendment 134. In section 1 of the Union Territory Goods and Services Tax Act, 2017 (hereinafter 14 of 2017.
of section 1. referred as the Union Territory Goods and Services Tax Act), in sub-section (2), for the
words “Dadra and Nagar Haveli, Daman and Diu”, the words “Dadra and Nagar Haveli 45
and Daman and Diu, Ladakh” shall be substituted.
Amendment 135. In section 2 of the Union Territory Goods and Services Tax Act, in clause (8), for
of section 2. sub-clauses (iii) and (iv), the following sub-clauses shall be substituted, namely:––
“(iii) Dadra and Nagar Haveli and Daman and Diu;

(iv) Ladakh;”.
Amendment 136. In section 26 of the Union Territory Goods and Services Tax Act, in 50
of section 26. sub-section (1), in the proviso, for the words “three years”, the words “five years” shall be
substituted.
43

137. (1) Notwithstanding anything contained in the notification of the Government of Retrospective
India in the Ministry of Finance (Department of Revenue) number G.S.R. 710(E), dated exemption
the 28th June, 2017, issued by the Central Government, on the recommendations of the from, or levy
Council, in exercise of the powers under sub-section (1) of section 7 of the Union Territory or collection
14 of 2017. 5 Goods and Services Tax Act, 2017, –– of, Union
territory tax in
certain cases.
(i) no Union territory tax shall be levied or collected in respect of supply of fishmeal
(falling under heading 2301), during the period commencing from the 1st day of July,
2017 and ending with the 30th day of September, 2019 (both days inclusive);
(ii) Union territory tax at the rate of six per cent. shall be levied or collected in
10 respect of supply of pulley, wheels and other parts (falling under heading 8483) and
used as parts of agricultural machinery (falling under headings 8432, 8433 and 8436),
during the period commencing from the 1st day of July, 2017 and ending with the 31st
day of December, 2018 (both days inclusive).
(2) No refund shall be made of all such tax which has been collected, but which
15 would not have been so collected, had sub-section (1) been in force at all material
times.
Goods and Services Tax

(Compensation to States)
15 of 2017. 138. In section 14 of the Goods and Services Tax (Compensation to States) Act, 2017, Amendment
20 in sub-section (1), in the proviso, for the words “three years”, the words “five years” shall of section 14.
be substituted.
CHAPTER V
HEALTH CESS
139. (1) In the case of goods specified in the Fourth Schedule being goods imported Health Cess
25 into India, there shall be levied and collected for the purposes of the Union, a duty of on imported
customs, to be called the Health Cess, at the rates specified in the said Schedule, for the medical
purposes of financing the health infrastructure and services. devices.
(2) The Central Government may, after due appropriation made by Parliament by law in
this behalf, utilise such sums of money of the Health Cess levied under this Chapter for
30 the purposes specified in sub-section (1), as it may consider necessary.
(3) For the purposes of calculating the Health Cess under this Chapter on the goods
specified in theFourth Schedule, where such duty is leviable at any percentage of its
value, 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 the provisions of section 14 of
52 of 1962. 35 the Customs Act, 1962 (hereafter in this Chapter referred to as the Customs Act).
(4) The Health Cess leviable under sub-section (1), chargeable on the goods specified
in the Fourth Schedule, shall be in addition to any other duties of customs chargeable on
such goods under the Customs Act or any other law for the time being in force.
(5) The provisions of the Customs Act and the rules and regulations made thereunder,
40 including those relating to refunds and exemptions from duties, offences and imposition of
penalty, shall, as far as may be, apply in relation to the levy and collection of the Health
Cess leviable under this Chapter in respect of the goods specified in the Fourth Schedule
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 the regulations made thereunder, as the case may be.
45 CHAPTER VI
MISCELLANEOUS
PART I
AMENDMENTS TO THE INDIAN STAMP ACT, 1899

140. The provisions of this Part shall come into force on the 1st day of April, 2020. Commencement
of this Part.
2 of 1899. 50 141. In section 9A of the Indian Stamp Act, 1899 (hereafter in this Part referred to as Amendment
the Stamp Act), in sub-section (2), the following proviso shall be inserted, namely:–– of section 9A.
“Provided that no such duty shall be chargeable in respect of the instruments of

transaction in stock exchanges and depositories established in any International Financial
28 of 2005. Services Centre set up under section 18 of the Special Economic Zones Act, 2005.”.
44

Insertion of 142. In the Stamp Act, after section 73A, the following section shall be inserted,
new section namely:––
73B.
Power to “73B. The Central Government may,––

issue
directions and (a) issue directions relating to such matters and subject to such conditions, as it
to authorise deems necessary; 5
certain
authorities to (b) in writing, authorise the Securities and Exchange Board of India established
issue under section 3 of the Securities and Exchange Board of India Act, 1992 or the
instructions, Reserve Bank of India constituted under section 3 of the Reserve Bank of India Act, 15 of 1992.
etc. 1934 to issue instructions, circulars or guidelines, 2 of 1934.
for carrying out the provisions of Part AA of Chapter II and the rules made thereunder”. 10
PART II
AMENDMENT TO THE PROHIBITION OF BENAMIPROPERTY TRANSACTIONS

ACT, 1988
Amendment 143. In the Prohibition of Benami Property Transactions Act, 1988, in section 9, in
of Act 45 of sub-section (1), for clause (b), the following clause shall be substituted with effect from 15
1988. the 1st day of April, 2020, namely:––
“(b)(i) has been a member of the Indian Legal Service and has held the post of Joint
Secretary or equivalent post in that Service; or
(ii) is qualified for appointment as District Judge.”.
PART III 20
AMENDMENT TO THEELECTION COMMISSION (CONDITIONS OF SERVICE OF

ELECTION COMMISSIONERS AND TRANSACTION OF BUSINESS) ACT, 1991
Amendment 144. In the Election Commission (Conditions of Service of Election Commissioners and
of Act 11 of Transaction of Business) Act, 1991, in section 8, for the words "allowance, provision of
1991. rent-free residence and exemption from payment of income-tax on the values of such 25
rent-free residence, conveyance facilities, sumptuary allowance, medical facilities and
such other conditions of service", the words "allowance and provision of rent-free
residence" shall be substituted with effect from the 1st day of April, 2021.
PART IV
AMENDMENT TO THE FINANCE ACT, 2001 30

Substitution of 145. For the Seventh Schedule to the Finance Act, 2001, the Schedule specified in
new Schedule theFifth Schedule shall be substituted.
for Seventh
Schedule to
Act 14 of 2001.
PART V
AMENDMENTS TO THEFINANCE ACT, 2013

Amendment 146. In the Finance Act, 2013 (hereafter in this Part referred to as the principal Act), in 35 17 of 2013.
of section section 116, with effect from the 1st day of April, 2020,—
116.
(a) in clause (7), for the words “sale of commodity derivatives or option on
commodity derivatives in respect of commodities, other than agricultural commodities,
traded in recognised associations”, the words “sale of commodity derivatives or sale of
commodity derivatives based on prices or indices of prices of commodity derivatives or 40
option on commodity derivatives or option in goods in respect of commodities, other
than agricultural commodities, traded in recognised stock exchange” shall be
substituted;
(b) in clause (8),––
(A) for the words, brackets and figures “Forward Contracts (Regulation) Act, 45 74 of 1952.
1952”, the words, brackets and figures “Securities Contracts(Regulation) Act, 1956” 42 of 1956.
(B) after the words “or the rules made”, the words “or the notifications issued”
shall be inserted.
45

147. In section 117 of the principal Act, for the Table, the following Table shall be Amendment
substituted with effect from the 1st day of April, 2020, namely:–– of section
117.
“TABLE
Sl. No. Taxable commodities Rate Payable by
5 transaction
(1) (2) (3) (4)
1. Sale of commodity 0.01 per cent. seller
derivative
2. Sale of commodity 0.01 per cent. seller
10 derivatives based on
prices or indices of prices
of commodity derivatives
3. Sale of option on 0.05 per cent. seller
commodity derivative
15 4. Sale of option in goods 0.05 per cent. seller
5. Sale of option on 0.0001 per cent. purchaser

commodity derivative,
where option is exercised
6. Sale of option in goods, 0.0001 per cent. purchaser

15 where option is exercised
resulting in actual delivery
of goods
7. Sale of option in goods, 0.125 per cent. purchaser.”.

where option is exercised
20 resulting in a settlement
otherwise than by the
actual delivery of goods
148. In section 118 of the principal Act, with effect from the 1st day of April, 2020,–– Amendment
of section
118.
(i) in clause (a), for the words “commodity derivative” at both the places where they
25 occur, the words “commodity derivative or commodity derivative based on prices or
indices of prices of commodity derivatives” shall be substituted;
(ii) in clause (b),––
(A) after the words “an option on commodity derivative”, the words “or option in
goods” shall be inserted;
30 (B) in sub-clause (i), for the words and figure “serial number 2”, the words and
figures “serial numbers 3 and 4” shall be substituted;
(C) in sub-clause (ii), for the words and figure “serial number 3”, the words and
figures “serial numbers 5 and 6” shall be substituted;
(D) after sub-clause (ii), the following sub-clause shall be inserted, namely:––
35 “(iii)the difference between the settlement price and the strike price, in respect of
transaction at serial number 7 of the Table in section 117.”.
149. In sections 119, 120 and 132A of the principal Act, for the words “recognised Amendment
association” wherever they occur, the words “recognised stock exchange” shall be of sections
substituted with effect from the 1st day of April, 2020. 119, 120
and 132A.
______________
40 Declaration under the Provisional Collection of Taxes Act, 1931
It is hereby declared that it is expedient in the public interest that the provisions of
clauses 115 (a), 115 (b), 139 and 145 of this Bill shall have immediate effect under the
16 of 1931. Provisional Collection of Taxes Act, 1931.
______________
THE FIRST SCHEDULE
(See section 2)
PART I
INCOME-TAX
Paragraph A 5
(I) In the case of every individual other than the individual referred to in items (II) and (III) of this Paragraph 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 being a case to which any other Paragraph of
this Part applies,—
Rates of income-tax 10
(1) where the total income does not exceed Rs. 2,50,000 Nil;
(2) where the total income exceeds Rs. 2,50,000 but does 5 per cent. of the amount by which the total income exceeds
not exceed Rs. 5,00,000 Rs. 2,50,000;
(3) where the total income exceeds Rs. 5,00,000 but does Rs.12,500 plus 20 per cent. of the amount by which the total
not exceed Rs. 10,00,000 income exceeds Rs. 5,00,000; 15
(4) where the total income exceeds Rs. 10,00,000 Rs. 1,12,500 plus 30 per cent. of the amount by which the
total income exceeds Rs.10,00,000.
(II) 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,—
not exceed Rs. 5,00,000 Rs. 3,00,000;
(3) where the total income exceeds Rs. 5,00,000 but does Rs.10,000 plus 20 per cent. of the amount by which the total
not exceed Rs. 10,00,000 income exceeds Rs. 5,00,000; 25
(III) 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,—
not exceed Rs. 10,00,000 Rs. 5,00,000;
total income exceeds Rs. 10,00,000. 35
Surcharge on income-tax
The amount of income-tax computed in accordance with the preceding provisions of this Paragraph, or 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, calculated, 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 40
Income-tax Act,—
(a) having a total income (including the income under the provisions of section 111A and section 112A of the
Income-tax Act) exceeding fifty lakh rupees but not exceeding one crore rupees, at the rate of ten per cent. of such
income-tax;
(b) having a total income (including the income under the provisions of section 111A and section 112A of the 45
Income-tax Act) exceeding one crore rupees, but not exceeding two crore rupees at the rate of fifteen per cent. of such
income-tax;
(c) having a total income (excluding the income under the provisions of section 111A and section 112A 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; 50
(d) having a total income (excluding the income under the provisions of section 111A and section 112A of the Income-
tax Act) exceeding five crore rupees, at the rate of thirty-seven per cent. of such income-tax; and
46
47
(e) having a total income (including income under the provisions of section 111A and section 112A) exceeding two
crore rupees, but is not covered under clauses (c) and (d), shall be applicable at the rate of fifteen per cent. of such income-
tax:
Provided that in case where the total income includes any income chargeable under section 111A and section 112A
5 of the Income-tax Act, the rate of surcharge on the amount of income-tax computed in respect of that part of income shall not
exceed fifteen per cent:
Provided further that in the case of persons mentioned above having total income exceeding,—
(a) fifty lakh rupees but not exceeding one crore rupees, the total amount payable as income-tax and surcharge
on such income shall not exceed the total amount payable as income-tax on a total income of fifty lakh rupees by
10 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 income-tax and
surcharge on such income 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;
(c) two crore rupees but does not exceed five crore rupees, the total amount payable as income-tax and
15 surcharge on such income 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;
(d) five crore rupees, the total amount payable as income-tax and surcharge on such income 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.
20 Paragraph B
In the case of every co-operative society,—
Rates of income-tax
(1) where the total income does not exceed Rs.10,000 10 per cent. of the total income;
(2) where the total income exceeds Rs.10,000 but does not Rs.1,000 plus 20 per cent. of the amount by which the total
25 exceed Rs. 20,000 income exceeds Rs. 10,000;
(3) where the total income exceeds Rs. 20,000 Rs. 3,000 plus 30 per cent. of the amount by which the total
income exceeds Rs. 20,000.
30 section 111A or section 112 or section 112A of the Income-tax Act, shall, in the case of every co-operative society, having a total
income exceeding one crore rupees, be increased by a surcharge for the purposes of the Union calculated at the rate of twelve
per cent. of such income-tax:
Provided that in the case of every co-operative society mentioned above having total income exceeding one crore rupees,
the total amount payable as income-tax and surcharge on such income shall not exceed the total amount payable as income-tax
35 on a total income of one crore rupees by more than the amount of income that exceeds one crore rupees.
Paragraph C
In the case of every firm,—
Rate of income-tax
On the whole of the total income 30 per cent.
40 Surcharge on income-tax
section 111A or section 112 or section 112A of the Income-tax Act, shall, in the case of every firm, having a total income
exceeding one crore rupees, be increased by a surcharge for the purposes of the Union calculated at the rate of twelve per cent.
of such income-tax:
45 Provided that in the case of every firm mentioned above having total income exceeding one crore rupees, the total amount
payable as income-tax and surcharge on such income 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.
Paragraph D
In the case of every local authority,—
50 Rate of income-tax
section 111A or section 112 or section 112A of the Income-tax Act, shall, in the case of every local authority, having a total
48
Provided that in the case of every local authority mentioned above having total income exceeding one crore rupees, the
total amount payable as income-tax and surcharge on such income 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. 5
Paragraph E
In the case of a company,—
Rates of income-tax
I. In the case of a domestic company,—
(i) where its total turnover or the gross receipt in the 25 per cent. of the total income; 10
previous year 2017-2018 does not exceed four hundred
crore rupees;
(ii) other than that referred to in item (i) 30 per cent. of the total income.
II. In the case of a company other than a domestic
company,— 15
(i) on so much of the total income as consists of,— 50 per cent.;
(a) royalties received from Government or an
Indian concern in pursuance of an agreement made by
it with the Government or the Indian concern after the
31st day of March, 1961 but before the 1st day of April, 20
1976; or
(b) fees for rendering technical services received
from Government or an Indian concern in pursuance of
an agreement made by it with the Government or the
Indian concern after the 29th day of February, 1964 but 25
before the 1st day of April, 1976, and where such
agreement has, in either case, been approved by the
Central Government
(ii) on the balance, if any, of the total income 40 per cent..
Surcharge on income-tax 30
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 calculated,—
(i) in the case of every domestic company,––
(a) having a total income exceeding one crore rupees but not exceeding ten crore rupees, at the rate of seven 35
per cent. of such income-tax; and
(b) having a total income exceeding ten crore rupees, at the rate of twelve per cent. of such income-tax;
(ii) in the case of every company other than a domestic company,––
(a) having a total income exceeding one crore rupees but not exceeding ten crore rupees, at the rate of two
per cent. of such income-tax; and 40
(b) having a total income exceeding ten crore rupees, at the rate of five per cent. of such income-tax:
Provided that in the case of every company having a total income exceeding one crore rupees but not exceeding ten crore
rupees, the total amount payable as income-tax and surcharge on such income 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 further that in the case of every company having a total income exceeding ten crore rupees, the total amount 45
payable as income-tax and surcharge on such income 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.
PART II
RATES FOR DEDUCTION OF TAX AT SOURCE IN CERTAIN CASES
In every case in which under the provisions of sections 193, 194A, 194B, 194BB, 194D, 194LBA, 194LBB, 194LBC and 50
195 of the Income-tax Act, tax is to be deducted at the rates in force, deduction shall be made from the income subject to the
deduction at the following rates:—
Rate of income-tax
1. In the case of a person other than a company—
(a) where the person is resident in India— 55
(i) on income by way of interest other than “Interest on securities” 10 per cent.;
49
(ii) on income by way of winnings from lotteries, crossword 30 per cent.;

puzzles, card games and other games of any sort
(iii) on income by way of winnings from horse races 30 per cent.;
(iv) on income by way of insurance commission 5 per cent.;
5 (v) on income by way of interest payable on— 10 per cent.;
(A) any debentures or securities for money issued by or on
behalf of any local authority or a corporation established by a
Central, State or Provincial Act;
(B) any debentures issued by a company where such
10 debentures are listed on a recognised stock exchange in India in
accordance with the Securities Contracts (Regulation)
Act, 1956 (42 of 1956) and any rules made thereunder;
(C) any security of the Central or State Government;
(vi) on any other income 10 per cent.;
15 (b) where the person is not resident in India—
(i) in the case of a non-resident Indian—
(A) on any investment income 20 per cent.;
(B) on income by way of long-term capital gains referred to 10 per cent.;
in section 115E or sub-clause (iii) of clause (c) of sub-section (1)
20 of section 112
(C) on income by way of long-term capital gains referred to 10 per cent.;
in section 112A
(D) on other income by way of long-term capital gains [not 20 per cent.;
being capital gains referred to in clauses (33) and (36) of section
25 10] referred to in section 112A exceeding one lakh rupees
(E) on income by way of short-term capital gains referred 15 per cent.;
to in section 111A
(F) on income by way of interest payable by Government or 20 per cent.;
an Indian concern on moneys borrowed or debt incurred by
30 Government or the Indian concern in foreign currency (not being
income by way of interest referred to in section 194LB or section
194LC)
(G) on income by way of royalty payable by Government or 10 per cent.;
an Indian concern in pursuance of an agreement made by it with
35 the Government or the Indian concern where such royalty is in
consideration for the transfer of all or any rights (including the
granting of a licence) in respect of copyright in any book on a
subject referred to in the first proviso to sub-section (1A) of
section115A of the Income-tax Act, to the Indian concern, or in
40 respect of any computer software referred to in the second proviso
to sub-section (1A) of section115A of the Income-tax Act, to a
person resident in India
(H) on income by way of royalty [not being royalty of the 10 per cent.;
nature referred to in sub-item (b)(i)(G)] payable by Government
45 or an Indian concern in pursuance of an agreement made by it
with the Government or the Indian concern and where such
agreement is with an Indian concern, the agreement is approved
by the Central Government or where it relates to a matter included
in the industrial policy, for the time being in force, of the
50 Government of India, the agreement is in accordance with that
policy
(I) on income by way of fees for technical services payable 10 per cent.;
by Government or an Indian concern in pursuance of an
agreement made by it with the Government or the Indian concern
55 and where such agreement is with an Indian concern, the
agreement is approved by the Central Government or where it
relates to a matter included in the industrial policy, for the time
being in force, of the Government of India, the agreement is in
accordance with that policy
50
(J) on income by way of winnings from lotteries, crossword 30 per cent.;

(K) on income by way of winnings from horse races 30 per cent.;
(L) on the whole of the other income 30 per cent.;
(ii) in the case of any other person— 5
(A) on income by way of interest payable by Government or 20 per cent.;
an Indian concern on moneys borrowed or debt incurred by
Government or the Indian concern in foreign currency (not being
income by way of interest referred to in section194LB or section
194LC) 10
(B) on income by way of royalty payable by Government or 10 per cent.;
an Indian concern in pursuance of an agreement made by it with
the Government or the Indian concern where such royalty is in
consideration for the transfer of all or any rights (including the
granting of a licence) in respect of copyright in any book on a 15
subject referred to in the first proviso to sub-section (1A) of section
115A of the Income-tax Act, to the Indian concern, or in respect
of any computer software referred to in the second proviso to
sub-section (1A) of section 115A of the Income-tax Act, to a person
resident in India 20
(C) on income by way of royalty [not being royalty of the 10 per cent.;
nature referred to in sub-item (b)(ii)(B)] payable by Government
or an Indian concern in pursuance of an agreement made by it
with the Government or the Indian concern and where such
agreement is with an Indian concern, the agreement is approved 25
by the Central Government or where it relates to a matter included
in the industrial policy, for the time being in force, of the
Government of India, the agreement is in accordance with that
policy
(D) on income by way of fees for technical services payable 10 per cent.; 30
by Government or an Indian concern in pursuance of an
agreement made by it with the Government or the Indian concern
and where such agreement is with an Indian concern, the
agreement is approved by the Central Government or where it
relates to a matter included in the industrial policy, for the time 35
accordance with that policy
(E) on income by way of winnings from lotteries, crossword 30 per cent.;
(F) on income by way of winnings from horse races 30 per cent.; 40
(G) on income by way of short-term capital gains referred 15 per cent.;
to in section 111A
(H) on income by way of long-term capital gains referred to 10 per cent.;
in sub-clause (iii) of clause (c) of sub-section (1) of section 112
(I) on income by way of long-term capital gains referred to 10 per cent.; 45
in section 112A exceeding one lakh rupees
(J) on income by way of other long-term capital gains [not 20 per cent.;
being long-term capital gains referred to in clauses (33) and (36)
of section 10]
(K) on the whole of the other income 30 per cent. 50
2. In the case of a company—
(a) where the company is a domestic company—
(i) on income by way of interest other than “Interest on securities” 10 per cent.;
(ii) on income by way of winnings from lotteries, crossword 30 per cent.;
puzzles, card games and other games of any sort 55
51
(iii) on income by way of winnings from horse races 30 per cent.;

(iv) on any other income 10 per cent.;
(b) where the company is not a domestic company—
(i) on income by way of winnings from lotteries, crossword 30 per cent.;
5 puzzles, card games and other games of any sort
(ii) on income by way of winnings from horse races 30 per cent.;
(iii) on income by way of interest payable by Government 20 per cent.;
or an Indian concern on moneys borrowed or debt incurred by
Government or the Indian concern in foreign currency (not being income
10 by way of interest referred to in section 194LB or section 194LC)
(iv) on income by way of royalty payable by Government or an 10 per cent.;
Indian concern in pursuance of an agreement made by it with the
Government or the Indian concern after the 31st day of March, 1976
where such royalty is in consideration for the transfer of all or any rights
15 (including the granting of a licence) in respect of copyright in any book
on a subject referred to in the first proviso to sub-section (1A) of section
115A of the Income-tax Act, to the Indian concern, or in respect of any
computer software referred to in the second proviso to
sub-section (1A) of section 115A of the Income-tax Act, to a person
20 resident in India
(v) on income by way of royalty [not being royalty of the nature
referred to in sub-item (b)(iv)] payable by Government or an Indian
concern in pursuance of an agreement made by it with the Government
or the Indian concern and where such agreement is with an Indian
25 concern, the agreement is approved by the Central Government or
where it relates to a matter included in the industrial policy, for the time
accordance with that policy—
(A) where the agreement is made after the 31st day of 50 per cent.;
30 March, 1961 but before the 1st day of April, 1976
(B) where the agreement is made after the 31st day of 10 per cent.;
March, 1976
(vi) on income by way of fees for technical services payable by
the Government or an Indian concern in pursuance of an agreement
35 made by it with the Government or the Indian concern and where such
agreement is with an Indian concern, the agreement is approved by
the Central Government or where it relates to a matter included in the
industrial policy, for the time being in force, of the Government of India,
the agreement is in accordance with that policy—
40 (A) where the agreement is made after the 29th day of 50 per cent.;
February, 1964 but before the 1st day of April, 1976
(B) where the agreement is made after the 31st day of 10 per cent.;
March, 1976
(vii) on income by way of short-term capital gains referred to in 15 per cent.;
45 section 111A
(viii) on income by way of long-term capital gains referred to in 10 per cent.;
sub-clause (iii) of clause (c) of sub-section (1) of section 112
(ix) on income by way of long-term capital gains referred to in 10 per cent.;
section 112A exceeding one lakh rupees
50 (x) on income by way of other long-term capital gains [not being 20 per cent.;
long-term capital gains referred to in clauses (33) and (36) of section 10]
(xi) on any other income 40 per cent..
Explanation.—For the purposes of item 1(b)(i) of this Part, “investment income” and “non-resident Indian” shall have the
respective meanings assigned to them in Chapter XII-A of the Income-tax Act.
55 Surcharge on income-tax
The amount of income-tax deducted in accordance with the provisions of––
(i) item 1 of this Part, 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,
52
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, calculated,––
I. at the rate of ten per cent. of such tax, where the income or the aggregate of such incomes (including
the income under the provisions of sections 111A and 112A of the Income-tax Act) paid or likely to be paid and
subject to the deduction exceeds fifty lakh rupees but does not exceed one crore rupees; 5
II. at the rate of fifteen per cent. of such tax, where the income or the aggregate of such incomes
(including the income under the provisions of sections 111A and 112A of the Income-tax Act) 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
(excluding the income under the provisions of sections 111A and 112A of the Income-tax Act) paid or likely to 10
be paid and subject to the deduction exceeds two crore rupees but does not exceed five crore rupees; and
IV. at the rate of thirty-seven per cent. of such tax, where the income or the aggregate of such incomes
(excluding the income under the provisions of sections 111A and 112A of the Income-tax Act) paid or likely to
be paid and subject to the deduction exceeds five crore rupees;
V. at the rate of fifteen per cent. of such tax, where the income or aggregate of such incomes (including 15
income under the provisions of section 111A and section 112A of the Income-tax Act) paid or likely to be paid
and subject to the deduction exceeds two crore rupees, but is not covered under sub-clauses III and IV:
Provided that in case where the total income includes any income chargeable under section 111A and
section 112A of the Income-tax Act, the rate of surcharge on the amount of Income-tax deducted in respect of
that part of income shall not exceed fifteen per cent.; 20
(b) in the case of every co-operative society or firm, being a non-resident, calculated at the rate of twelve per
cent., where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction
exceeds one crore rupees;
(ii) Item 2 of this Part shall be increased by a surcharge, for the purposes of the Union, in the case of every company
other than a domestic company, calculated,–– 25
(a) at the rate of two per cent. of such income-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; and
(b) at the rate of five per cent. of such income-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.
PART III 30
RATES FOR CHARGING INCOME-TAX IN CERTAIN CASES, DEDUCTING INCOME-TAX FROM INCOME CHARGEABLE
UNDER THE HEAD “SALARIES” AND COMPUTING “ADVANCE TAX”
In cases in which income-tax has to be charged under sub-section (4) of section 172 of the Income-tax Act or
sub-section (2) of section 174 or section 174A or section 175 or sub-section (2) of section 176 of the said Act or deducted from,
or paid on, from income chargeable under the head “Salaries” under section 192 of the said Act or in which the “advance tax” 35
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” [not being “advance tax” in respect of any income chargeable to tax under Chapter XII or Chapter XII-A
or income chargeable to tax under 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 at the rates as specified in that Chapter or
section or surcharge, wherever applicable, on such “advance tax” in respect of any income chargeable to tax under section 40
115A or section 115AB or section 115AC or section 115ACA or section 115AD or section 115B or section 115BA or section
115BAA or section 115BAB or section 115BAD or section 115BB or section 115BBA or section 115BBC or section 115BBD or
section 115BBDA or section 115BBE or section 115BBF or section 115BBG or section 115E or section 115JB or section 115JC]
shall be charged, deducted or computed at the following rate or rates:—
Paragraph A 45
(I) In the case of every individual other than the individual referred to in items (II) and (III) of this Paragraph 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 being a case to which any other Paragraph of
this Part applies,—
not exceed Rs. 5,00,000 Rs. 2,50,000;
(3) where the total income exceeds Rs. 5,00,000 but does Rs. 12,500 plus 20 per cent. of the amount by which the
not exceed Rs. 10,00,000 total income exceeds Rs. 5,00,000; 55
53
(II) 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,—
Rates of income-tax
5 (2) where the total income exceeds Rs. 3,00,000 but does 5 per cent. of the amount by which the total income exceeds
not exceed Rs. 5,00,000 Rs.3,00,000;
(3) where the total income exceeds Rs. 5,00,000 but does Rs. 10,000 plus 20 per cent. of the amount by which the
not exceed Rs. 10,00,000 total income exceeds Rs. 5,00,000;
(4) where the total income exceeds Rs. 10 ,00,000 Rs. 1,10,000 plus 30 per cent. of the amount by which the
10 total income exceeds Rs. 10,00,000.
(III) 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,—
Rates of income-tax
15 (2) where the total income exceeds Rs. 5,00,000 but does 20 per cent. of the amount by which the total income exceeds
not exceed Rs. 10,00,000 Rs. 5,00,000;
(3) where the total income exceeds Rs.10,00,000 Rs. 1,00,000 plus 30 per cent. of the amount by which the
total income exceeds Rs. 10,00,000.
20 The amount of income-tax computed in accordance with the preceding provisions of this Paragraph, or the provisions of
section 111A or section 112 or section 112A or the provisions of section 115BAC, of the Income-tax Act, shall be increased by
a surcharge for the purposes of the Union, calculated, 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,—
25 (a) having a total income (including the income under the provisions of section 111A and section 112A of the
Income-tax Act) exceeding fifty lakh rupees but not exceeding one crore rupees, at the rate of ten per cent. of such
income-tax;
(b) having a total income (including the income under the provisions of section 111A and section 112A of the
Income-tax Act) exceeding one crore rupees but not exceeding two crore rupees, at the rate of fifteen per cent. of such
30 income-tax;
(c) having a total income (excluding the income under the provisions of section 111A and section 112A 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; and
(d) having a total income (excluding the income under the provisions of section 111A and section 112A of the
35 Income-tax Act) exceeding five crore rupees, at the rate of thirty-seven per cent. of such income-tax;
(e) having a total income (including income under the provisions of section 111A and section 112A) exceeding two
crore rupees, but is not covered under clauses (c) and (d), shall be applicable at the rate of fifteen per cent. of such
income-tax:
Provided that in case where the total income includes any income chargeable under section 111A and section 112A of
40 the Income-tax Act, the rate of surcharge on the amount of Income-tax computed in respect of that part of income shall not
exceed fifteen per cent.:
Provided further that in the case of persons mentioned above having total income exceeding,—
(a) fifty lakh rupees but not exceeding one crore rupees, the total amount payable as income-tax and surcharge on
such income shall not exceed the total amount payable as income-tax on a total income of fifty lakh rupees by more than
45 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 income-tax and surcharge
on such income 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;
(c) two crore rupees but does not exceed five crore rupees, the total amount payable as income-tax and surcharge
50 on such income 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;
54
(d) five crore rupees, the total amount payable as income-tax and surcharge on such income 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.
Paragraph B
In the case of every co-operative society,— 5
Rates of income-tax
(1) where the total income does not exceed Rs.10,000 10 per cent. of the total income;
(2) where the total income exceeds Rs.10,000 but does not Rs. 1,000 plus 20 per cent. of the amount by which the total
exceed Rs. 20,000 income exceeds Rs. 10,000;
(3) where the total income exceeds Rs. 20,000 Rs. 3,000 plus 30 per cent. of the amount by which the total 10
income exceeds Rs. 20,000.
section 111A or section 112 or section 112A of the Income-tax Act, shall, in the case of every co-operative society, having a total
income exceeding one crore rupees, be increased by a surcharge for the purposes of the Union calculated at the rate of twelve 15
Provided that in the case of every co-operative society mentioned above having total income exceeding one crore rupees,
the total amount payable as income-tax and surcharge on such income 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.
Paragraph C 20
In the case of every firm,—
Rate of income-tax
The amount of income-tax computed in accordance with the preceding provisions of this Paragraph, or the provisions of 25
section 111A or section 112 or section 112A of the Income-tax Act, shall, in the case of every firm, having a total income
exceeding one crore rupees, be increased by a surcharge for the purposes of the Union calculated at the rate of twelve per cent.
of such income-tax:
Provided that in the case of every firm mentioned above having total income exceeding one crore rupees, the total amount
payable as income-tax and surcharge on such income shall not exceed the total amount payable as income-tax on a total 30
income of one crore rupees by more than the amount of income that exceeds one crore rupees.
Paragraph D
In the case of every local authority,—
Rate of income-tax
On the whole of the total income 30 per cent. 35
section 111A or section 112 or section 112A of the Income-tax Act, shall, in the case of every local authority, having a total
per cent. of such income-tax: 40
Provided that in the case of every local authority mentioned above having total income exceeding one crore rupees, the
total amount payable as income-tax and surcharge on such income 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.
Paragraph E
In the case of a company,— 45
Rates of income-tax
I. In the case of a domestic company,—
(i) where its total turnover or the gross receipt in the 25 per cent. of the total income;
previous year 2018-2019 does not exceed four hundred
crore rupees; 50
(ii) other than that referred to in item (i) 30 per cent. of the total income.
55
II. In the case of a company other than a domestic company,—

(i) on so much of the total income as consists of,— 50 per cent.;
(a) royalties received from the Government or an Indian concern
in pursuance of an agreement made by it with the Government or the
5 Indian concern after the 31st day of March, 1961 but before the 1st day
of April, 1976; or
(b) fees for rendering technical services received from
Government or an Indian concern in pursuance of an agreement made
by it with the Government or the Indian concern after the 29th day of
10 February, 1964 but before the 1st day of April, 1976,
and where such agreement has, in either case, been approved by the 50 per cent.;
Central Government;
(ii) on the balance, if any, of the total income 40 per cent..
15 The amount of income-tax computed in accordance with the preceding provisions of this Paragraph, or 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, calculated,––
(i) in the case of every domestic company,––
(a) having a total income exceeding one crore rupees but not exceeding ten crore rupees, at the rate of seven
20 per cent. of such income-tax; and
(b) having a total income exceeding ten crore rupees, at the rate of twelve per cent. of such income-tax;
(ii) in the case of every company other than a domestic company,––
(a) having a total income exceeding one crore rupees but not exceeding ten crore rupees, at the rate of two
per cent. of such income-tax; and
25 (b) having a total income exceeding ten crore rupees, at the rate of five per cent. of such income-tax:
Provided that in the case of every company having a total income exceeding one crore rupees but not exceeding ten crore
rupees, the total amount payable as income-tax and surcharge on such income 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 further that in the case of every company having a total income exceeding ten crore rupees, the total amount
30 payable as income-tax and surcharge on such income 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.
PART IV
[See section 2 (13)(c)]
RULES FOR COMPUTATION OF NET AGRICULTURAL INCOME
35 Rule 1.—Agricultural income of the nature referred to in sub-clause (a) of clause (1A) of section 2 of the Income-tax Act
shall be computed as if it were income chargeable to income-tax under that Act under the head “Income from other sources” and
the provisions of sections 57 to 59 of that Act shall, so far as may be, apply accordingly:
Provided that sub-section (2) of section 58 shall apply subject to the modification that the reference to section 40A therein
shall be construed as not including a reference to sub-sections (3), (3A) and (4) of section 40A.
40 Rule 2.—Agricultural income of the nature referred to in sub-clause (b) or sub-clause (c) of clause (1A) of section 2 of the
Income-tax Act [other than income derived from any building required as a dwelling-house by the receiver of the rent or revenue
of the cultivator or the receiver of rent-in-kind referred to in the said sub-clause (c)] shall be computed as if it were income
chargeable to income-tax under that Act under the head “Profits and gains of business or profession” and the provisions of
sections 30, 31, 32, 36, 37, 38, 40, 40A [other than sub-sections (3), (3A) and (4) thereof], 41, 43, 43A, 43B and 43C of the
45 Income-tax Act shall, so far as may be, apply accordingly.
Rule 3.—Agricultural income of the nature referred to in sub-clause (c) of clause (1A) of section 2 of the Income-tax Act,
being income derived from any building required as a dwelling-house by the receiver of the rent or revenue or the cultivator or
the receiver of rent-in-kind referred to in the said sub-clause (c) shall be computed as if it were income chargeable to
income-tax under that Act under the head “Income from house property” and the provisions of sections 23 to 27 of that Act shall,
50 so far as may be, apply accordingly.
Rule 4.—Notwithstanding anything contained in any other provisions of these rules, in a case—
(a) where the assessee derives income from sale of tea grown and manufactured by him in India, such income shall
be computed in accordance with rule 8 of the Income-tax Rules, 1962, and sixty per cent. of such income shall be
regarded as the agricultural income of the assessee;
55 (b) where the assessee derives income from sale of centrifuged latex or cenex or latex based crepes (such as pale
latex crepe) or brown crepes (such as estate brown crepe, re-milled crepe, smoked blanket crepe or flat bark crepe) or
56
technically specified block rubbers manufactured or processed by him from rubber plants grown by him in India, such
income shall be computed in accordance with rule 7A of the Income-tax Rules, 1962, and sixty-five per cent. of such
income shall be regarded as the agricultural income of the assessee;
(c) where the assessee derives income from sale of coffee grown and manufactured by him in India, such income
shall be computed in accordance with rule 7B of the Income-tax Rules, 1962, and sixty per cent. or seventy-five per cent., 5
as the case may be, of such income shall be regarded as the agricultural income of the assessee.
Rule 5.—Where the assessee is a member of an association of persons or a body of individuals (other than a Hindu
undivided family, a company or a firm) which in the previous year has either no income chargeable to tax under the Income-tax
Act or has total income not exceeding the maximum amount not chargeable to tax in the case of an association of persons or a
body of individuals (other than a Hindu undivided family, a company or a firm) but has any agricultural income then, the agricultural 10
income or loss of the association or body shall be computed in accordance with these rules and the share of the assessee in the
agricultural income or loss so computed shall be regarded as the agricultural income or loss of the assessee.
Rule 6.—Where the result of the computation for the previous year in respect of any source of agricultural income is a loss,
such loss shall be set off against the income of the assessee, if any, for that previous year from any other source of agricultural
income: 15
Provided that where the assessee is a member of an association of persons or a body of individuals and the share of the
assessee in the agricultural income of the association or body, as the case may be, is a loss, such loss shall not be set off
against any income of the assessee from any other source of agricultural income.
Rule 7.—Any sum payable by the assessee on account of any tax levied by the State Government on the agricultural
income shall be deducted in computing the agricultural income. 20
Rule 8.—(1) Where the assessee has, in the previous year relevant to the assessment year commencing on the 1st day
of April, 2020, any agricultural income and the net result of the computation of the agricultural income of the assessee for any
one or more of the previous years relevant to the assessment years commencing on the 1st day of April, 2012 or the 1st day
of April, 2013 or the 1st day of April, 2014 or the 1st day of April, 2015 or the 1st day of April, 2016 or the 1st day of April, 2017
or the 1st day of April, 2018 or the 1st day of April, 2019, is a loss, then, for the purposes of sub-section (2) of section 2 of this 25
Act,––
(i) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April,
2012, to the extent, if any, such loss has not been set off against the agricultural income for the previous year relevant to
the assessment year commencing on the 1st day of April, 2013 or the 1st day of April, 2014 or the 1st day of April, 2015
or the 1st day of April, 2016 or the 1st day of April, 2017 or the 1st day of April, 2018 or the 1st day of April, 2019, 30
(ii) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April,
or the 1st day of April, 2017 or the 1st day of April, 2018 or the 1st day of April, 2019,
(iii) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April, 35
or the 1st day of April, 2018 or the 1st day of April, 2019,
(iv) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April,
2015, to the extent, if any, such loss has not been set off against the agricultural income for the previous year relevant to 40
or the 1st day of April, 2019,
(v) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April,
the assessment year commencing on the 1st day of April, 2017 or the 1st day of April, 2018 or the 1st day of April, 2019, 45
(vi) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April,
the assessment year commencing on the 1st day of April, 2018 or the 1st day of April, 2019,
(vii) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April,
2018, to the extent, if any, such loss has not been set off against the agricultural income for the previous year relevant to 50
the assessment year commencing on the 1st day of April, 2019,
(viii) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April,
2019,
shall be set off against the agricultural income of the assessee for the previous year relevant to the assessment year
commencing on the 1st day of April, 2020. 55
(2) Where the assessee has, in the previous year relevant to the assessment year commencing on the 1st day of
April, 2021, 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 agricultural income and the net result of the computation of the agricultural
income of the assessee for any one or more of the previous years relevant to the assessment years commencing on the 1st day
of April, 2013 or the 1st day of April, 2014 or the 1st day of April, 2015 or the 1st day of April, 2016 or the 1st day of April, 2017 60
or the 1st day of April, 2018 or the 1st day of April, 2019 or the 1st day of April, 2020, is a loss, then, for the purposes of
sub-section (10) of section 2 of this Act,––
57
(i) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of
April, 2013, to the extent, if any, such loss has not been set off against the agricultural income for the previous year
relevant to the assessment year commencing on the 1st day of April, 2014 or the 1st day of April, 2015 or the 1st day of
April, 2016 or the 1st day of April, 2017 or the 1st day of April, 2018 or the 1st day of April, 2019 or the 1st day of
5 April, 2020,
(ii) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of
April, 2017 or the 1st day of April, 2018 or the 1st day of April, 2019 or the 1st day of April, 2020,
10 (iii) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of
April, 2018 or the 1st day of April, 2019 or the 1st day of April, 2020,
(iv) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of
15 April, 2016, to the extent, if any, such loss has not been set off against the agricultural income for the previous year
April, 2019 or the 1st day of April, 2020,
(v) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of
20 relevant to the assessment year commencing on the 1st day of April, 2018 or the 1st day of April, 2019 or the 1st day of
April, 2020,
(vi) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of
relevant to the assessment year commencing on the 1st day of April, 2019 or the 1st day of April, 2020,
25 (vii) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of
relevant to the assessment year commencing on the 1st day of April, 2020,
(viii) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of
April, 2020,
30 shall be set off against the agricultural income of the assessee for the previous year relevant to the assessment year
commencing on the 1st day of April, 2021.
(3) Where any person deriving any agricultural income from any source has been succeeded in such capacity by
another person, otherwise than by inheritance, nothing in sub-rule (1) or sub-rule (2) shall entitle any person, other than
the person incurring the loss, to have it set off under sub-rule (1) or, as the case may be, sub-rule (2).
35 (4) Notwithstanding anything contained in this rule, no loss which has not been determined by the Assessing Officer
under the provisions of these rules or the rules contained in the First Schedule to the Finance Act, 2012 (23 of 2012) or the
First Schedule to the Finance Act, 2013 (17 of 2013) or the First Schedule to the Finance (No. 2) Act, 2014 (25 of 2014) or the
First Schedule to the Finance Act, 2015 (20 of 2015) or the First Schedule to the Finance Act, 2016 (28 of 2016) or the First
Schedule to the Finance Act, 2017 (7 of 2017) or the First Schedule to the Finance Act, 2018 (13 of 2018) or the First
40 Schedule of the Finance (No. 2) Act, 2019 (23 of 2019) shall be set off under sub-rule (1) or, as the case may be, sub-rule (2).
Rule 9.—Where the net result of the computation made in accordance with these rules is a loss, the loss so computed
shall be ignored and the net agricultural income shall be deemed to be nil.
Rule 10.—The provisions of the Income-tax Act relating to procedure for assessment (including the provisions of
section 288A relating to rounding off of income) shall, with the necessary modifications, apply in relation to the computation
45 of the net agricultural income of the assessee as they apply in relation to the assessment of the total income.
Rule 11.—For the purposes of computing the net agricultural income of the assessee, the Assessing Officer shall
have the same powers as he has under the Income-tax Act for the purposes of assessment of the total income.
THE SECOND SCHEDULE
[See section 115 (a)]
In the Customs Tariff Act, in the First Schedule,––
(1) in Chapter 8, for the entry in column (4) occurring against tariff item 0802 32 00, the entry “100%” shall be substituted;
(2) in Chapter 38, for the entry in column (4) occurring against tariff item 3824 99 00, the entry “17.5%” shall be substituted; 5
(3) in Chapter 64,––
(i) for the entry in column (4) occurring against all the tariff items of headings 6401, 6402, 6403, 6404 and 6405, the entry
“35%” shall be substituted;
(ii) for the entry in column (4) occurring against all the tariff items of heading 6406, the entry “20%” shall be substituted;
(4) in Chapter 67, for the entry in column (4) occurring against all the tariff items of heading 6702, the entry “20%” shall be 10
substituted;
(5) in Chapter 69, for the entry in column (4) occurring against tariff items 6911 10 11, 6911 10 19, 6911 10 21, 6911 10 29,
6911 90 20, 6911 90 90, 6912 00 10, 6912 00 20, 6912 00 40 and 6912 00 90, the entry “20%” shall be substituted;
(i) for the entry in column (4) occurring against all the tariff items of heading 7013, the entry “20%” shall be substituted; 15
(ii) for the entry in column (4) occurring against tariff item 7018 10 20, the entry “20%” shall be substituted;
(7) in Chapter 71, for the entry in column (4) occurring against all the tariff items of heading 7118, the entry “12.5%” shall be
substituted;
(8) in Chapter 73, for the entry in column (4) occurring against all the tariff items of heading 7323, the entry “20%” shall be
substituted; 20
(9) in Chapter 74, for the entry in column (4) occurring against all the tariff items of sub-heading 7418 10, the entry “20%”
(10) in Chapter 76, for the entry in column (4) occurring against all the tariff items of sub-heading 7615 10, the entry “20%”
(11) in Chapter 83,–– 25
(i) for the entry in column (4) occurring against tariff items 8301 10 00, 8301 30 00, 8301 40 10, 8301 40 90, 8301 50 00,
8301 60 00 and 8301 70 00, the entry “20%” shall be substituted;
(iii) for the entry in column (4) occurring against all the tariff items of headings 8305, 8306 and 8310, the entry “20%” shall
be substituted; 30
(i) for the entry in column (4) occurring against tariff item 8414 30 00, the entry “12.5%” shall be substituted;
(ii) for the entry in column (4) occurring against tariff items 8414 51 10, 8414 51 20 and 8414 51 30, the entry “20%” shall
be substituted;
(iii) for the entry in column (4) occurring against tariff item 8414 51 40, the entry “10%” shall be substituted; 35
(iv) for the entry in column (4) occurring against tariff item 8414 51 90, the entry “20%” shall be substituted;
(v) for the entry in column (4) occurring against tariff items 8414 59 10, 8414 59 30 and 8414 59 90, the entry “10%” shall
be substituted;
(vi) for the entry in column (4) occurring against tariff item 8414 59 20, the entry “20%” shall be substituted;
(vii) for the entry in column (4) occurring against tariff item 8414 80 11, the entry “12.5%” shall be substituted; 40
(viii) for the entry in column (4) occurring against tariff items 8418 10 10, 8418 30 10, 8418 30 90, 8418 40 10, 8418 40 90,
8418 50 00, 8418 61 00, 8418 69 10, 8418 69 20, 8418 69 30, 8418 69 40, 8418 69 50 and 8418 69 90, the entry “15%” shall
be substituted;
(ix) for the entry in column (4) occurring against tariff item 8419 89 10, the entry “10%” shall be substituted;
(x) for the entry in column (4) occurring against tariff items 8421 39 20 and 8421 39 90, the entry “15%” shall be substituted; 45
58
59
(i) for the entry in column (4) occurring against tariff items 8504 40 10, 8504 40 21, 8504 40 29, 8504 40 30, 8504 40 40
and 8504 40 90, the entry “20%” shall be substituted;
(ii) for the entry in column (4) occurring against tariff items 8509 40 10, 8509 40 90 and 8509 80 00, the entry “20%” shall
5 be substituted;
(iii) for the entry in column (4) occurring against tariff items 8510 10 00, 8510 20 00 and 8510 30 00, the entry “20%” shall
be substituted;
(iv) for the entry in column (4) occurring against tariff items 8515 11 00, 8515 19 00, 8515 21 10, 8515 21 20, 8515 21 90,
8515 29 00, 8515 31 00, 8515 39 10, 8515 39 20, 8515 39 90, 8515 80 10 and 8515 80 90, the entry “10%” shall be
10 substituted;
(v) for the entry in column (4) occurring against tariff items 8516 10 00, 8516 21 00, 8516 29 00, 8516 31 00, 8516 32 00,
8516 33 00, 8516 40 00, 8516 60 00, 8516 71 00, 8516 72 00, 8516 79 10, 8516 79 20, 8516 79 90 and 8516 80 00, the entry
“20%” shall be substituted;
(vi) for the entry in column (4) occurring against tariff item 8517 70 10, the entry “20%” shall be substituted;
15 (14) in Chapter 94, for the entry in column (4) occurring against all the tariff items of headings 9401, 9403, 9404 and 9405,
the entry “25%” shall be substituted;
(15) in Chapter 95, for the entry in column (4) occurring against all the tariff items of heading 9503, the entry “60%” shall be
substituted;
20 (i) for the entry in column (4) occurring against all the tariff items of heading 9603, the entry “20%” shall be substituted;
(iii) for the entry in column (4) occurring against all the tariff items of headings 9615 and 9617, the entry “20%” shall be
substituted.
THE THIRD SCHEDULE
[See section 115 (b)]
In the Customs Tariff Act, in the First Schedule,––
Tariff Item Description of goods Unit Rate of duty

Standard Preferential 5
(1) (2) (3) (4) (5)
(1) in Chapter 84, for tariff item 8414 51 90 and the entries relating thereto, the following shall be substituted, namely:—
“8414 51 50 - - - Wall fans u 20% -

8414 51 90 - - - Other u 20% -”;
(2) in Chapter 85,–– 10
(i) in heading 8529, after tariff item 8529 90 20 and the entries relating thereto, the following shall be inserted, namely: —
“8529 90 30 - - - Open cell for television set u 15% -”;

(ii) in heading 8541, for tariff item 8541 40 11 and the entries relating thereto, the following shall be subsitituted, namely: —
“8541 40 11 - - - - Solar cells, not assembled u 20% -
8541 40 12 - - - - Solar cells, assembled in modules or made u 20% -”. 15

up into panels
60
THE FOURTH SCHEDULE
(See section 139)
The rules for interpretation of the First Schedule to the Customs Tariff Act, 1975 (51 of 1975), the Section
Notes, Chapter Notes and the General Explanatory Notes of the said First Schedule shall apply to the interpretation
5 of this Schedule.
Item No. Description of goods Rate of duty
(1) (2) (3)
1. All goods falling under headings 9018, 9019, 9020, 9021 and 9022 of
the First Schedule to the Customs Tariff Act, 1975 (51 of 1975) 5%
61
THE FIFTH SCHEDULE
(See section 145)
'THE SEVENTH SCHEDULE
(See section 136)
NOTES 5
1. In this Schedule, “tariff item”, “heading”, “sub-heading” and “Chapter” mean respectively a tariff item, heading,
sub-heading and Chapter in the Fourth Schedule to the Central Excise Act, 1944 (1 of 1944).
2. The rules for the interpretation of the Fourth Schedule to the Central Excise Act, 1944 (1 of 1944), the Section and
Chapter Notes and the General Explanatory Notes of the Fourth Schedule shall apply to the interpretation of this Schedule.
Tariff Item Description of goods Unit Rate of duty 10

(1) (2) (3) (4)
2402 20 10 --- Other than filter cigarettes, of length not exceeding 65

millimetres Tu Rs. 200 per thousand
2402 20 20 --- Other than filter cigarettes, of length exceeding 65
millimetres but not exceeding 70 millimetres Tu Rs. 250 per thousand 15
2402 20 30 --- Filter cigarettes of length (including the length of the
filter, the length of filter being 11 millimetres or its
actual length, whichever is more) not exceeding 65
millimetres Tu Rs. 440 per thousand
2402 20 40 --- Filter cigarettes of length (including the length of the 20
filter, the length of filter being 11 millimetres or its actual
length, whichever is more) exceeding 65 millimetres but
not exceeding 70 millimetres Tu Rs. 440 per thousand
2402 20 50 --- Filter cigarettes of length (including the length of the
filter, the length of filter being 11 millimetres or its actual 25
length, whichever is more) exceeding 70 millimetres but
not exceeding 75 millimetres Tu Rs. 545 per thousand
2402 20 90 --- Other Tu Rs. 735 per thousand
2402 90 10 --- Cigarettes of tobacco substitutes Tu Rs. 600 per thousand
2403 11 10 --- Hookah or gudaku tobacco kg. 25% 30
2403 19 10 --- Smoking mixtures for pipes and cigarettes kg. 60%
2403 19 21 ---- Other than paper rolled biris, manufactured without the
aid of machine Tu Rs. 1.00 per thousand
2403 19 29 ---- Other Tu Rs. 2.00 per thousand
2403 19 90 --- Other kg. 25% 35
2403 91 00 -- “Homogenised” or “reconstituted” tobacco kg. 25%
2403 99 10 --- Chewing tobacco kg. 25%
2403 99 20 --- Preparations containing chewing tobacco kg. 25%
2403 99 30 --- Jarda scented tobacco kg. 25%
2403 99 40 --- Snuff kg. 25% 40
2403 99 50 --- Preparations containing snuff kg. 25%
2403 99 60 --- Tobacco extracts and essence kg. 25%
2403 99 90 --- Other kg. 25%
2709 20 00 Petroleum crude kg. Rs. 50 per tonne.’.
62
STATEMENT OF OBJECTS AND REASONS
The object of the Bill is to give effect to the financial proposals of the Central
Government for the financial year 2020-2021. The notes on clauses explain the
various provisions contained in the Bill.
NIRMALA SITHARAMAN.
NEW DELHI;
The 30th January, 2020.
___________
PRESIDENT’S RECOMMENDATION UNDER ARTICLES 117 AND 274 OF THE

CONSTITUTION OF INDIA
[Copy of letter No. F.2(4)-B(D)/2020, dated the 30th January, 2020 from
Smt. Nirmala Sitharaman, Minister of Finance, to the Secretary-General, Lok Sabha.]
The President, having been informed of the subject matter of the proposed
Bill, recommends, under clauses (1) and (3) of article 117, read with clause (1) of
article 274, of the Constitution of India, the introduction of the Finance Bill, 2020
to the Lok Sabha and also recommends to the Lok Sabha the consideration of
the Bill.
2. The Bill will be introduced in the Lok Sabha immediately after the
presentation of the Budget on the 1st February, 2020.
63
Notes on clauses
Income-tax It is proposed to amend said sub-clause (b) of said

Explanation 1 so as to substitute the words “one hundred
Clause 2 read with First Schedule to the Bill, seeks to and eighty-two days” with “one hundred and twenty days”.
specify the rates at which income-tax is to be levied on
income chargeable to tax for the assessment year 2020- It is proposed to insert clause (1A) in said section after
2021. Further, it lays down the rates at which tax is to be clause (1) thereof so as to provide that notwithstanding
deducted at source during the financial deductions under the anything contained in that sub-section, an individual, being a
Income-tax Act; and the rates at which “advance tax” is to be citizen of India, shall be deemed to be resident in India in
paid, tax is to be deducted at source from, or paid on, any previous year, if he is not liable to tax in any other
income chargeable under the head “salaries” and tax is to be country or territory by reason of his domicile or residence or
calculated and charged in special cases for the financial year any other criteria of similar nature.
2020-2021.
Clause (6) of said section provides for situations in
Clause 3 of this Bill seeks to amend section 2 of the which a person shall be “not ordinarily resident” in India in a
Income-tax Act relating to definitions. previous year. Sub-clause (a) thereof provides that if such
person is an individual, he shall be “not ordinarily resident” in
Clause(13A) of the said section defines “business trust” India if he has been a non-resident in India in nine out of the
to mean a trust registered as an Infrastructure Investment ten previous years preceding that year, or has during the
Trust under the Securities Exchange Board of India seven previous years preceding that year been in India for a
(Infrastructure Investment Trusts) Regulation, 2014 or a Real period of, or periods amounting in all to, seven hundred and
Estate Investment Trust under the Securities Exchange twenty-nine days or less. Sub-clause (b) thereof contains
Board of India (Real Estate Investment Trusts) Regulation, similar provision in case of manager of the Hindu undivided
2014 made under the Securities and Exchange Board of family.
India Act, 1992, whose units are required to be listed on a
recognised stock exchange in accordance with the aforesaid It is proposed to substitute said clause (6) so as to
regulations. provide that an individual or an Hindu Undivided Family shall
be said to be “not ordinarily resident” in India in a previous
It is proposed to amend the said clause so as to omit the year if the individual or the manager of the Hindu Undivided
long line relating to the requirement of listing of the business Family, as the case may be, has been a non-resident in India
trust from recognised stock exchange in accordance with the in seven out of ten previous years preceding that year.
regulations made by the Securities Exchange Board of India.
These amendments will take effect from 1st April, 2021
This amendment will take effect from 1st April, 2021 and and will, accordingly, apply in relation to the assessment
will, accordingly, apply in relation to the assessment year year 2021-2022 and subsequent assessment years.
2021-2022 and subsequent assessment years.
Clause 5 of the Bill seeks to amend section 9 of the
Clause(42A) of the said section defines the expression Income-tax Act relating to income deemed to accrue or arise
“short term capital asset” to be capital asset held by an in India.
assessee for not more than thirty-six months immediately
preceding the date of its transfer. Further Explanation to the Clause (i) of sub-section (1) of said section provides a
said clause provides for determining the period for which the set of circumstances in which income accruing or arising,
capital asset is held by the assessee. directly or indirectly, is taxable in India.
It is proposed to amend clause (i) of the said Clause (a) of Explanation 1 to said clause provides that
Explanation so as to insert sub-clause (hh) to provide that in for the purposes of said clause, in the case of a business of
the case of a capital asset, being a unit or units in a which all the operations are not carried out in India, the
segregated portfolio, referred to in sub-section (2AG) of income of the business deemed under this clause to accrue
section 49, there shall be included the period for which the or arise in India shall be only such part of the income as is
original unit or units in the main portfolio were held by the reasonably attributable to the operations carried out in India.
assessee. It is proposed to amend said clause (a) so as to provide
Thisamendment will take effect from 1st April, 2020 and that the provisions contained therein shall not apply to the
will, accordingly, apply in relation to the assessment year business having business connection in India on account of
significant economic presence.
This amendment will take effect from the 1st April, 2022
and will, accordingly, apply in relation to the assessment
Income-tax Act relating to residence in India. year 2022-2023 and subsequent assessment years.
Clause (1) of said section provides for situations in Explanation 2A to said clause, inter alia, clarifies that the
which an individual shall be resident in India in a previous “significant economic presence” of a non-resident in India
year. Sub-clause (c) thereof provides that the individual shall shall constitute "business connection" in India.
be Indian resident in a year, if he having within the four years
preceding that year been in India for a period or periods It is proposed to omit the said Explanation with effect
from the 1st April, 2021 and will, accordingly, be omitted
amounting in all to three hundred and sixty-five days or
from the assessment year 2021-2022 and subsequent
more, is in India for a period or periods amounting in all to assessment years.
sixty days or more in that year. Clause (b) of Explanation 1
of said clause provides that in case of an individual being a It is proposed to insert a new Explanation 2A so as to
citizen of India, or a person of Indian origin within the declare that for the purposes of clause (i) of sub-section (1)
meaning of Explanation to clause (e) of section 115C of the of said section, the “significant economic presence” of a non-
Income-tax Act, who, being outside India, comes on a visit to resident in India shall constitute "business connection" in
India in any previous year, the provisions of sub-clause (c) India and "significant economic presence" for this purpose,
shall mean––
shall apply in relation to that year as if for the words "sixty
days" occurring therein, the words "one hundred and eighty- (a)transaction in respect of any goods, services or
two days" had been substituted. property carried out by a non-resident with any person in
64

65

India including provision of download of data or software and Exchange Board of India (Foreign Portfolio Investors)
in India, if the aggregate of payments arising from such Regulations, 2014.
transaction or transactions during the previous year
exceeds such amount as may be provided by rules; or It is further proposed to insert a third proviso to the said
Explanation so as to provide that provisions contained
(b)systematic and continuous soliciting of business therein shall not apply to an asset or a capital asset, held by
activities or engaging in interaction with such number of a non-resident by way of investment, directly or indirectly, in
users in India, as may be provided by rules. Category-I foreign portfolio investor under the Securities and
Exchange Board of India (Foreign Portfolio Investors)
It is further proposed to provide that the transactions or Regulations, 2019, made under the Securities and Exchange
activities shall constitute “significant economic presence” in Board of India Act, 1992.
India, whether or not—
These amendments will take effect from the 1st April,
(i)theagreement for such transactions or activities is 2020 and will, accordingly, apply in relation to the
entered in India; or assessment year 2020-2021 and subsequent assessment
(ii)the non-resident has a residence or place of years.
business in India; or Clause (vi) of sub-section (1) of said section deems
(iii) the non-resident renders services in India. certain income by way of royalty to accrue or arise in India.
Clause (v) of Explanation 2 to said clause defines the term
It is also proposed to provide that only so much of “royalty” to mean the transfer of all or any rights (including
income as is attributable to the transactions or activities the granting of a licence) in respect of any copyright, literary,
referred to in clause (a) or clause (b) of the said Explanation artistic or scientific work including films or video tapes for use
shall be deemed to accrue or arise in India. in connection with television or tapes for use in connection
These amendments will take effect from the 1st April, with radio broadcasting; broadcasting, but not including
2022 and will, accordingly, apply in relation to the consideration for the sale, distribution or exhibition of
assessment year 2022-2023 and subsequent assessment cinematographic films.
years. It is proposed to amend clause (v) of Explanation 2 to
It is also proposed to insert a new Explanation 3A so as said clause so as to provide that the consideration for the
to declare that the income attributable to operations carried sale, distribution or exhibition of cinematographic films shall
out in India, as referred to in Explanation 1 of clause (i) of not be excluded from definition of royalty.
sub-section (1) of said section, shall include income from––
(i)such advertisement which targets a customer and will, accordingly, apply in relation to the assessment
who resides in India or a customer who accesses the year 2021-2022 and subsequent assessment years.
advertisement through internet protocol address located
in India; Clause 6 of the Bill seeks to amend section 9A of the
Income-tax Act relating to certain activities not to constitute
(ii) sale of data collected from a person who resides
in India or from a person who uses internet protocol business connection in India.
address located in India; and Sub-section (3) of the said section provides for the
(iii)sale of goods and services using data collected conditions to be fulfilled for being an eligible investment fund.
from a person who resides in India or from a person who
Clause (c) of said sub-section provides that the
uses internet protocol address located in India.
aggregate participation or investment in the fund, directly or
This amendment will take effect from 1st April, 2021 and indirectly, by persons resident in India should not exceed five
will, accordingly, apply in relation to the assessment year per cent. of the corpus of the fund.
It is proposed to amend the said clause (c) by insertion
It is also proposed to insert a proviso to Explanation 3A of a proviso so as to provide that for the purposes of
to provide that the provisions of the said Explanation shall
calculation of the aggregate participation or investment in the
also apply to the income attributable to the transactions or
activities referred to in Explanation 2A. fund, any contribution made by the eligible fund manager
during the first three years of operation of the fund, not
This amendment will take effect from the 1st April, 2022 exceeding twenty-five crore rupees, shall not be taken into
and will, accordingly, apply in relation to the assessment account.
year 2022-2023 and subsequent assessment years.
Clause (j) of said sub-section provides that the monthly
The Explanation 5 to the said clause provides that an average of the corpus of the fund shall not be less than one
asset or capital asset being any share or interest in a hundred crore rupees. First proviso to said clause further
company or entity registered or incorporated outside India
provides that where the fund has been established or
shall be deemed to be and shall always be deemed to have
incorporated in the previous year, the corpus of fund shall
been situated in India if the share or interest derives, directly
or indirectly, its value substantially from the assets located in not be less than one hundred crore rupees at the end of a
India. Second proviso to the said Explanation provides that period of six months from the last day of the month of its
the provisions thereof shall not apply to an asset or capital establishment or incorporation, or at the end of such
asset, held by a non-resident by way of investment, directly previous year, whichever is later.
or indirectly, in Category-I or Category-II foreign portfolio It is proposed to amend the first proviso to said clause
investor under the Securities and Exchange Board of India (j) of said sub-section so as to provide that where the fund
(Foreign Portfolio Investors) Regulations, 2014, made under
has been established or incorporated in the previous year,
the Securities and Exchange Board of India Act, 1992.
the fund shall be required to fulfil the condition of maintaining
It is proposed to amend the said proviso so as to the corpus of one hundred crore rupees within a period of
provide that the exemption provided therein shall continue to twelve months from the end of the month of its establishment
apply to such investments prior to repeal of the Securities or incorporation.
66

These amendments will take effect from 1st April, 2020 where the application is under clause (iv) of said proviso,
and will, accordingly apply in relation to the assessment year pass an order in writing granting it approval provisionally for
2020-2021and subsequent assessment years. a period of three yearsfrom the assessment year from which
the registration is sought, and send a copy of such order to
Clause 7 of the Bill seeks to amend section 10 of the the fund or trust or institution or any university or other
Income-tax Act relating to incomes not included in total educational institution or any hospital or other medical
income. institution.
First proviso to clause (23C) of said section provides for Eighth proviso to clause (23C) thereof, inter alia,
application to be made in prescribed form and manner to the provides for period for which a notification issued by Central
prescribed authority for exemption in respect of income of Government under sub-clause (iv) or sub-clause (v) of said
the fund or trust or institution or any university or other clause shall have effect.
educational institution or any hospital or other medical
institution referred to in sub-clause (iv) or sub-clause (v) or It is proposed to substitute the eighth proviso so as to
sub-clause (vi) or sub-clause (via) of said clause in a case provide that the approval granted under the proposed
where such income is applied or accumulated during the second proviso shall apply in relation to the income of the
previous year for certain purposes in accordance with the fund or trust or institution or any university or other
relevant provisions. educational institution or any hospital or other medical
institution, where the application is made under clause (i) of
It is proposed to substitute said proviso so as to provide the first proviso, from the assessment year from which
that the exemption to such fund or trust or institution or any approval was earlier granted to it; where the application is
university or other educational institution or any hospital or made under clause (iii) of the first proviso, from the first of
other medical institution shall not be available unless it is the assessment years for which it was provisionally
approved under the proposed second proviso on an approved; in any other case, from the assessment year
application made in the prescribed form and manner to the immediately following the financial year in which such
Principal Commissioner or Commissioner, for grant of application is made.
approval where the fund or trust or institution or any
university or other educational institution or any hospital or Ninth proviso to clause (23C) of said section thereof,
other medical institution is approved under the second inter alia, provides for the period within which a notification
proviso (as it stood before its amendment by the Finance under sub-clause (iv) or sub-clause (v) shall be issued or
Act, 2020), within three months from the date on which this approval under sub-clause (iv) or sub-clause (v) or
clause has come into force; where the fund or trust or sub-clause (vi) or sub-clause (via) shall be granted or an
institution or any university or other educational institution or order rejecting the application made in this behalf shall be
any hospital or other medical institution is approved and the passed.
period of such approval is set to expire, at least six months It is proposed to substitute the ninth proviso so as to
prior to expiry of said period; where the fund or trust or provide that the order under clause (i), sub-clause (b) of
institution or any university or other educational institution or clause (ii) and clause (iii) of the proposed second proviso
any hospital or other medical institution has been shall be passed, in such form and manner as may be
provisionally approved, at least six months prior to expiry of prescribed, before expiry of period of three months, six
period of the provisional approval or within six months of months and one month respectively, calculated from the end
commencement of its activities, whichever is earlier; in any of the month in which the application was received.
other case, at least one month prior to commencement of the
previous year relevant to the assessment year from which These amendments will take effect from 1st June, 2020.
said registration is sought. The tenth proviso to the said clause provides that where
Second proviso to clause (23C) of said section thereof the total income, of the fund or trust or institution or any
provides for the inquiry to be made by the prescribed university or other educational institution or any hospital or
authority before approving the fund or trust or institution or other medical institution referred to in sub-clause (iv) or
any university or other educational institution or any hospital sub-clause (v) or sub-clause (vi) or sub-clause (via), without
or other medical institution referred to in sub-clause (iv) or giving effect to the provisions of the said sub-clauses,
sub-clause (v) or sub-clause (vi) or sub-clause (via) of said exceeds the maximum amount which is not chargeable to
clause. tax in any previous year, such trust or institution or university
or other educational institution or hospital or other medical
It is proposed to substitute the second proviso so as to institution shall get its accounts audited in respect of that
provide that the Principal Commissioner or Commissioner, year by an accountant as defined in the Explanation below
on receipt of an application made under the proposed first sub-section (2) of section 288 and furnish the report of such
proviso, shall, where the application is under clause (i) of audit along with the return of income for the relevant
said proviso, pass an order in writing granting it approval for assessment year.
a period of five years; where the application is under clause
(ii) or clause (iii) of said proviso, call for such documents or It is proposed to amend the said proviso so as to
information from it or make such inquiries as he thinks provide that such trust or institution or university or other
necessary in order to satisfy himself about, the genuineness educational institution or hospital or other medical institution
of activities of such fund or trust or institution or any should get the accounts audited before the specified date
university or other educational institution or any hospital or referred to in section 44AB (i.e. one month prior to the due
other medical institution and the compliance of such date for filing of return under sub-section (1) of section 139)
requirements of any other law for the time being in force by it and furnish the report of audit by that date.
as are material for the purpose of achieving its object; and This amendment will take effect from 1st April, 2020 and
after satisfying himself about the objects and the will, accordingly, apply in relation to the assessment year
genuineness of its activities, under item (A), and compliance 2020-2021 and subsequent assessment years.
of the requirements under item (B), of sub-clause (a), pass
an order in writing granting its approval for a period of five Sixteenth proviso to clause (23C) of said section
years; if he is not so satisfied, pass an order in writing thereof, inter alia, provides for the period within which
rejecting such application and also cancelling its approval application for exemption has to be made by the fund or trust
after affording it a reasonable opportunity of being heard; or institution or any university or other educational institution
67

or any hospital or other medical institution under the first clause shall not apply to any income, by way of dividend,
proviso. received on or after the 1st April, 2020.
It is proposed to omit the said proviso. Clause(35) of the said section exempts income received
in respect of the units of a Mutual Fund, units from the
It is further proposed to substitute the existing Administrator of the specified undertaking and units from the
eighteenth proviso so as to provide that all applications specified company. It is proposed to amend this clause to
made under the existing first proviso, pending before the provide that the provisions of the said clause shall not apply
Principal Commissioner or Commissioner, on which no order to any income, in respect of units, received on or after the
has been passed, shall be deemed to be an application 1st April, 2020.
made under clause (iv) of the proposed first proviso on that
date. It is also proposed to omit clause (45) of the said
section, which provides that any allowance and perquisite as
These amendments will take effect from 1st June, 2020. may be notified by the Central Government, paid to the
Clause (23D) of the said section exempts the income of serving or retired Chairman or Members of Union Public
Mutual Fund registered under the Securities and Exchange Services Commission shall be exempt from income-tax.
Board of India Act, 1992 or such other Mutual Funds. This These amendments will take effect from 1st April, 2021
exemption is subject to the provisions of Chapter XII-E and will, accordingly, apply in relation to the assessment
relating to special provision relating to tax on distributed year 2021-2022 and subsequent assessment years.
income. It is proposed to omit the reference of the said
Chapter in the said clause so that Mutual Funds are not It is proposed to insert a new clause (48C) in said
required to pay additional tax under that Chapter. section so as to provide exemption in respect of any income
accruing or arising to Indian Strategic Petroleum Reserves
Clause (23FC) of the said section exempts certain Limited, being a wholly owned subsidiary of Oil Industry
income of business trust including income by way of dividend Development Board under the Ministry of Petroleum and
referred to in sub-section (7) of section 115-O. It is proposed Natural Gas, as a result of arrangement for replenishment of
to amend the said clause so as to exempt all dividend crude oil stored in its storage facility in pursuance of
received or receivable by business trust from a special directions of the Central Government in this behalf.
purpose vehicle under the said clause.
It is further proposed to insert a proviso to newly
Clause (23FD) of the said section exempts income
distributed by business trust to a unit holder except the inserted clause so as to provide that nothing contained in
interest and rental income. It is proposed to amend the said this clause shall apply to an arrangement if the crude oil is
clause so as to exclude dividend income received by a unit not replenished in the storage facility within three years from
holder from business trust from such exemption. the end of the financial year in which the crude oil was
removed from the storage facility for the first time.
It is proposed to insert a new clause (23FE) in the said
section so as to provide exemption in respect of any income This amendment will take effect from 1st April, 2020 and
of a specified person in the nature of dividend, interest or will, accordingly, apply in relation to the assessment year
long-term capital gains arising from an investment made by it
in India, whether in the form of debt or equity, if the
investment–– Clause 8 of the Bill seeks to amend section 10A of the
(i)is made on or before the 31st day of March, 2024; Income-tax Act relating to special provision in respect of
newly established undertakings in free trade zone, etc.
(ii)is held for at least three years; and
Sub-section (1) of the said section provides that subject
(iii)is in a company or enterprise carrying on the
to the provisions of this section, a deduction of such profits
business of developing, or operating and maintaining, or
developing, operating or maintaining any infrastructure and gains as are derived by an undertaking from the export
facility as defined in the Explanation to clause (i) of sub- of articles or things or computer software for a period of ten
section (4) of section 80-IA or such other business as consecutive assessment years beginning with the
may be notified by the Central Government in this assessment year relevant to the previous year in which the
behalf. undertaking begins to manufacture or produce such articles
It is further proposed to insert an Explanation to the said or things or computer software, as the case may be, shall be
clause so as to define “specified person” for the purposes of allowed from the total income of the assessee.
this clause to mean–– Sub-section (5) of the said section provides that the
(a)a wholly owned subsidiary of the Abu Dhabi deduction under the said section shall not be admissible for
Investment Authority which–– any assessment year beginning on or after the 1st day of
April, 2001, unless the assessee furnishes in the prescribed
(i)is a resident of the United Arab Emirates; form, along with the return of income, the report of an
and accountant, as defined in the Explanation below sub-section
(2) of section 288 certifying that the deduction has been
(ii)makes investment, directly or indirectly, out
correctly claimed in accordance with the provisions of this
of the fund owned by the Government of the United
section.
Arab Emirates;
It is proposed to amend the said sub-section so as to
(b)sovereign wealth fund which shall qualify the
provide that the deduction under the said section shall not be
conditions specified therein.
admissible for any assessment year beginning on or after the
Clause(34) of the said section exempts income by way 1st day of April, 2001, unless the assessee furnishes in the
of dividends referred to in section 115-O except the income prescribed form the report of an accountant, as defined in
by way of dividend chargeable to tax in accordance with the the Explanation below sub-section (2) of section 288 before
provisions of section 115BBDA. It is proposed to amend the the specified date referred to in section 44AB, certifying that
said clause so as to provide that the provisions of the said the deduction has been correctly claimed in accordance with
the provisions of this section.
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This amendment will take effect from 1st April, 2020 and registration is sought to be made operative; where the trust
will, accordingly, apply in relation to the assessment year or institution has adopted or undertaken modifications of the
2020-2021 and subsequent assessment years. objects which do not conform to the conditions of
registration, within a period of thirty days from the date of
Clause 9 of the Bill seeks to amend section 11 of the said adoption or modification, in any other case, at least one
Income-tax Act relating to income from property held for month prior to commencement of the previous year relevant
charitable or religious purposes. to the assessment year from which said registration is
Sub-section (7) of said section provides that where a sought.
trust or an institution has been granted registration under This amendment will take effect from 1st June, 2020.
clause (b) of sub-section (1) of section 12AA or has obtained
registration at any time under section 12A [as it stood before It is further proposed to consequentially amend clause
its amendment by the Finance (No. 2) Act, 1996] and the (b) of sub-section (1) of the said sectionso as to provide that
said registration is in force for any previous year, then, such trust or institution should get the accounts audited by
nothing contained in section 10 [other than clause (1) and the accountant as defined in Explanation below sub-section
clause (23C) thereof] shall operate to exclude any income (2) of section 288 before the specified date referred to in
derived from the property held under trust from the total section 44AB (i.e. one month prior to the due date for filing of
income of the person in receipt thereof for that previous year. return under sub-section (1) of section 139) and furnish the
report of such audit by that date.
It is proposed to amend said sub-section so as to
substitute the reference to “clause (b) of sub-section (1) of This amendment will take effect from 1st April, 2020
section 12AA” to “section 12AA, and section 12AB”. and will, accordingly, apply in relation to the assessment
It is further proposed to insert a proviso to said sub-
section so as to provide that the registration referred therein Sub-section (2) of said section provides that an
shall become inoperative from the date on which the trust or application has been made on or after the 1st day of June,
institution is approved under clause (23C), or is notified 2007, the provisions of sections 11 and 12 shall apply in
under clause (46) of section 10, as the case may be, or the relation to the income of such trust or institution from the
date on which this proviso comes into force, whichever is assessment year immediately following the financial year in
later. which such application is made.
It is further proposed to insert another proviso to said It is proposed to insert first proviso to said sub-section
sub-section so as to provide that the trust or institution, so as to provide that the provisions of sections 11 and 12
whose registration has become inoperative under the shall apply to a trust or institution, where the application is
proposed first proviso, may apply to get its registration made under sub-clause (i) of proposed clause (ac) of
operative under proposed section 12AB subject to the sub-section (1), from the assessment year from which such
condition that on doing so, the approval under clause (23C) trust or institution was earlier granted registration; sub-clause
or notification under clause (46) of section 10, as the case (iii) of proposed clause (ac) of sub-section (1), from the first
may be, to such trust or institution shall cease to have any of the assessment years for which it was provisionally
effect from the date on which the said registration becomes registered.
operative and thereafter, it would not be entitled to
exemption under the respective clause. It is proposed to amend the existing first and third
proviso to sub-section (2) thereof so as to make reference of
These amendments will take effect from 1st June, 2020. proposed new section 12AB.
Clause 10 of the Bill seeks to amend section 12A of the This amendment will take effect from 1st June, 2020.
Income-tax Act relating to conditions for applicability of
sections 11 and 12. Clause 11 of the Bill seeks to amend section 12AA of
the Income-tax Act relating to procedure for registration.
Sub-section (1) of said section provides for the
conditions to be fulfilled by any trust or institution subject to It is proposed to insert a new sub-section (5) to said
which exemption under sections 11 and 12 shall be available section so as to provide that nothing contained in said
to it. section shall apply on or after the 1st day of April, 2021.
It is proposed to insert a new clause (ac) to the said This amendment will take effect from 1st June, 2020.
sub-section so as to provide, notwithstanding anything
contained in clauses (a), (aa) and (ab) of the said sub- Clause 12 of the Bill seeks to insert a new section 12AB
section, with condition that the trust or institution is registered in the Income-tax Act relating to procedure for fresh
under the proposed section 12AB on an application made by registration.
the person in receipt of the income in the prescribed form
Sub-section (1) of the proposed section provides that
and manner to the Principal Commissioner or Commissioner,
the Principal Commissioner or Commissioner, on receipt of
for registration of the trust or institution; where the trust or
institution is registered under section 12A [as it stood before an application made under the proposed clause (ac) of
its amendment by the Finance (No. 2) Act, 1996 (33 of sub-section (1) of section 12A, shall send a copy of order
1996)] or under section 12AA, within three months from the passed in writing, to the trust or institution, where the
date on which this clause has come into force; where the application is under sub-clause (i) of the said clause,
trust or institution is registered under section 12AB and the registering the trust or institution for a period of five years;
period of said registration is set to expire, at least six months where the application is under sub-clause (ii), the
prior to expiry of said period; where the trust or institution sub-clause (iii), sub-clause (iv) or sub-clause (v) of said
has been provisionally registered under section 12AB, at clause,—
least six months prior to expiry of period of the provisional
registration or within six months of commencement of its (i) call for such documents or information from the trust
activities, whichever is earlier; where registration of the trust or institution or making such inquiries as he thinks necessary
in order to satisfy himself about,—
or institution has become inoperative due to proviso to
sub-section (7) of section 11, at least six months prior to (A) the genuineness of activities of the trust or
commencement of the assessment year from which said institution; and
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(B) the compliance of such requirements of any Clause 13 of the Bill seeks to amend section 17 of the
other law for the time being in force by the trust or Income-tax Act relating to “salary”, “perquisite” and “profits in
institution as are material for the purpose of achieving its lieu of salary” defined.
object; and
Sub-clause (vii) of clause (2) of the said section
(ii) after satisfying himself about the objects of provides that the amount of any contribution to an approved
the trust or institution and the genuineness of its superannuation fund by the employer in respect of the
activities, under item (A), and compliance of the assessee, shall be treated as perquisite to the extent it
requirements under item (B), of exceeds one lakh and fifty thousand rupees.
sub-clause (i),––
It is proposed to amend the provisions of clause (2) of
(A)registering the trust or institution for a the said section so as to substitute sub-clause (vii) of the
period of five years; said clause to provide that the amount or the aggregate
amounts of any contribution made by the employer in
(B) if he is not so satisfied, pass an order respect of the assessee, to the account of an assessee in a
in writing rejecting such application and also recognised provident fund; in the scheme referred to in sub-
cancelling the registration of such trust or section (1) of section 80CCD; and in an approved
institution after affording a reasonable superannuation fund shall be treated as perquisite, to the
opportunity of being heard; extent it exceeds seven lakh and fifty thousand rupees in a
(C) where the application is under sub- previous year.
clause (vi) of the said clause, provisionally It is further proposed to insert a new sub-clause (viia) in
registering the trust or institution for a period of the said clause (2) so as to provide that annual accretion by
three years from the assessment year from way of interest, dividend or any other amount of similar
which the registration is sought. nature during the previous year to the balance at the credit of
Sub-section (2) of the proposed section provides that all the fund or scheme referred to in sub-clause (vii) may also
applications, pending before the Principal Commissioner or be treated as perquisite to the extent it relates to the
Commissioner on which no order has been passed under contribution referred to in the said new sub-clause (vii),
clause (b) of sub-section (1) of section 12AA before the date which is included in total income and shall be computed in
on which this section will come into force, shall be deemed to the prescribed manner.
be an application made under proposed sub-clause (vi) of These amendments will take effect from 1st April, 2021
clause (ac) of sub-section (1) of section 12A on that date. and will, accordingly, apply in relation to the assessment
Sub-section (3) of the proposed section provides that year 2021-2022 and subsequent assessment years.
the order under clause (a), sub-clause (ii) of clause (b) and Clause 14 of the Bill seeks to amend section 32AB of
clause (c) of sub-section (1) shall be passed, in such form the Income-tax Act relating to investment deposit account.
and manner as may be prescribed, before the expiry of the
period of three months, six months and one month Sub-section (5) of the said section provides that
respectively, calculated from the end of the month in which deduction under sub-section (1) shall not be admissible to
the application was received. assessee unless the accounts of the business or profession
Sub-section (4) of the proposed section provides that of the assessee for the previous year relevant to the
where registration of a trust or an institution has been assessment year for which the deduction is claimed have
granted under clause (a) or clause (b) of sub-section (1) and been audited by an accountant as defined in the Explanation
subsequently, the Principal Commissioner or Commissioner below sub-section (2) of section 288 and the assessee
is satisfied that the activities of such trust or institution are furnishes, along with his return of income, the report of such
not genuine or are not being carried out in accordance with audit in the prescribed form duly signed and verified by such
the objects of the trust or institution, as the case may be, he accountant.
shall pass an order in writing cancelling the registration of It is proposed to amend the said sub-section (5) so as to
such trust or institution after affording a reasonable provide that deduction under sub-section (1) of section 32AB
opportunity of being heard. shall not be admissible to assessee unless the accounts of
Sub-section (5) of the proposed section provides that the business or profession of the assessee for the previous
without prejudice to the provisions of sub-section (4), where year relevant to the assessment year for which deduction is
registration of a trust or an institution has been granted claimed have been audited by an accountant as defined in
under clause (a) or clause (b) of sub-section (1) and the Explanation below sub-section (2) of section 288 before
subsequently, it is noticed that,–– the specified date referred to section 44AB (i.e., one month
prior to the due date for filing of return under sub-section (1)
(a) the activities of the trust or the institution are of section 139) and the report of such audit is furnished by
being carried out in a manner that the provisions of that date.
sections 11 and 12 do not apply to exclude either whole
or any part of the income of such trust or institution due This amendment will take effect from 1st April, 2020 and
to operation of sub-section (1) of section 13; or will, accordingly, apply in relation to the assessment year
(b) the trust or institution has not complied with the
requirement of any other law, as referred to in item (B) Clause 15 of the Bill seeks to amend section 33AB of
of sub-clause (i) of clause (b) of sub-section (1), and the the Income-tax Act relating to tea development account,
order, direction or decree, by whatever name called, coffee development account and rubber development
holding that such non-compliance has occurred, has account.
either not been disputed or has attained finality, then, Sub-section (1) of the said section provides for
the Principal Commissioner or the Commissioner may, deduction to an assessee carrying on the business of
by an order in writing, after affording a reasonable growing and manufacturing tea or coffee or rubber in India,
opportunity of being heard, cancel the registration of who has, before the expiry of six months from the end of the
such trust or institution. previous year or before the due date of furnishing return of
This amendment will take effect from 1st June, 2020. his income has deposited any amount in an account
70

maintained by assessee under a scheme approved or Sub-section (1) of said section provides that the
framed by the Tea Board or the Coffee Board or the Rubber expenditures on scientific research in respect of which, the
Board with the previous approval of Central Government. deductions shall be allowed. Clause (ii) of said sub-section
provides that the deduction for any sum paid to a research
Sub-section (2) of the said section provides that association which has as its object the undertaking of
deduction under sub-section (1) shall not be admissible to scientific research or to a university, college or other
assessee unless the accounts of the business or profession institution to be used for scientific research, clause (iia) of
of the assessee for the previous year relevant to the said sub-section provides that any sum paid to a company to
assessment year for which the deduction is claimed have be used by it for scientific research, and clause (iii) of said
been audited by an accountant as defined in the Explanation sub-section provides that any sum paid to a research
below sub-section (2) of section 288 and the assessee association which has as its object the undertaking of
furnishes, along with his return of income, the report of such research in social science or statistical research or to a
audit in the prescribed form duly signed and verified by such university, college or other institution to be used for research
accountant. in social science or statistical research. Explanation of said
It is proposed to amend the said sub-section (2) to clause provides that assessee shall not be denied the
provide that deduction under sub-section (1) of section 33AB deduction in respect of any sum paid to a research
shall not be admissible to assessee unless the accounts of association, university, college or other institution to which
the business or profession of the assessee for the previous clause (ii) or clause (iii) applies, shall not be denied merely
year relevant to the assessment year for which deduction are on the ground that, subsequent to the payment of such sum
claimed have been audited by an accountant as defined in by the assessee, the approval granted to the association,
the Explanation below sub-section (2) of section 288 before university, college or other institution referred to in clause (ii)
the specified date referred to section 44AB (i.e., one month or clause (iii) has been withdrawn.
prior to the due date for filing of return under sub-section (1) It is proposed to amend the said Explanation so as to
of section 139) and the report of such audit is furnished by provide that the assessee shall not be denied the deduction
that date. in respect of any sum paid to a company referred to in
This amendment will take effect from 1st April, 2020 and clause (ii) which it is entitled to, merely on the ground that,
will, accordingly, apply in relation to the assessment year subsequent to the payment of such sum, the approval
2020-2021 and subsequent assessment years. granted to the company has been withdrawn.
Clause 16 of the Bill seeks to amend section 33ABA of It is further proposed to insert a new fifth proviso to said
the Income-tax Act relating to Site Restoration Fund. sub-section (1) so as to provide that every notification under
clause (ii) or clause (iii) in respect of the research
Sub-section (1) of the said section provides that if an association, university, college or other institution or under
assessee has deposited with a special account maintained clause (iia) in respect of the company issued on or before
by assessee for the purposes specified in a scheme
the date on which this proviso comes into effect, shall be
approved by Government of India or deposits any amount in
deemed to have been withdrawn unless such research
Site Restoration account opened by assessee in accordance
with, and for the purposes specified in, a scheme framed by association, university, college or other institution referred to
Ministry of Petroleum and Natural Gas, then assessee shall in clause (ii) or clause (iii) or the company referred to in
be allowed a deduction of lesser of the aggregate amount so clause (iia) makes an intimation in such form and manner to
deposited by the assessee or twenty per cent. of the profits the prescribed authority within three months from the date on
of such business computed under the head “Profits and which this proviso has come into effect, and subject to such
gains from Business or Profession” before making any intimation the notification shall be valid for a period of five
deduction under the said section. consecutive assessment years beginning with the
assessment year commencing on or after the 1st day of
Sub-section (2) of the said section provides that April, 2021.
deduction under sub-section (1) of section 33ABA will not be
admissible to assessee unless the accounts of the business It is also proposed to insert a new sixth proviso to said
or profession of the assessee for the previous year relevant sub-section (1) so as to provide thatany notification issued,
to the assessment year for which the deduction is claimed by the Central Government under clause (ii), clause (iia) or
have been audited by an accountant as defined in the clause (iii), after the date on which the Finance Bill, 2020
Explanation below sub-section (2) of section 288 and the receives the assent of the President, shall, at any one time,
assessee furnishes, along with his return of income, the have effect for such assessment year or years, not
report of such audit in the prescribed form duly signed and exceeding five assessment years as may be specified in the
verified by such accountant. notification.
It is proposed to amend sub-section (2) of the said It is also proposed to insert a new sub-section (1A) in
section to provide that deduction under sub-section (1) shall the said section after sub-section (1) thereof so as to provide
not be admissible to assessee unless the accounts of the that notwithstanding anything contained in sub-section (1),
business or profession of the assessee for the previous year the research association, university, college or other
relevant to the assessment year for which deduction are institution referred to in clause (ii) or clause (iii) or the
claimed have been audited by an accountant as defined in company referred to in clause (iia) of sub-section (1) shall
the Explanation below sub-section (2) of section 288 before not be entitled to deduction under respective clause of said
the specified date referred to section 44AB (i.e., one month sub-section, unless such research association, university,
prior to the due date for filing of return under sub-section (1) college or other institution or company,––
of section 139) and the report of such audit is furnished by
that date.
(a) prepares such statements for such period as
This amendment will take effect from 1st April, 2020 and may be prescribed and deliver or cause to be delivered
will, accordingly, apply in relation to the assessment year to the prescribed income-tax authority or the person
2020-2021 and subsequent assessment years. authorised by such authority such statement in such
form and verified in such manner and setting forth such
Clause 17 of the Bill seeks to amend section 35 of the particulars and within such time as may be prescribed,
Income-tax Act relating to expenditure on scientific research. and it may also file a correction statement for
71

rectification of any mistake or to add, delete or update business or profession of the assessee for the previous year
the information furnished in the statement delivered relevant to the assessment year for which deduction are
under this sub-section in such form and verified in such claimed have been audited by an accountant as defined in
manner as may be provided by rules; and the Explanation below sub-section (2) of section 288 before
the specified date referred to section 44AB (i.e., one month
(b)furnishes to the donor, a certificate specifying the prior to the due date for filing of return under sub-section (1)
amount of donation in such manner, containing such of section 139) and the assessee furnishes the report of
particulars and within such time from the date of receipt such audit by that date for the first year of deduction.
of sum, as may be prescribed.
This amendment will take effect from 1st April, 2020 and
These amendments will take effect from 1st June, 2020. will, accordingly, apply in relation to the assessment year
Clause 18 of the Bill seeks to amend section 35AD of 2020-2021 and subsequent assessment years.
the Income-tax Act relating to deduction in respect of Clause 20 of the Bill seeks to amend section 35E of the
expenditure on specified business. Income-tax Act relating to deduction for expenditure on
Sub-section (1) of the said section,inter alia, provides for prospecting, etc., for certain minerals.
one hundred per cent. deduction on capital expenditure Sub-section (1) of the said section provides that where
incurred on any specified business during the previous year an assessee, being an Indian company or a person other
in which such expenditure is incurred. than a company who is a resident in India and is engaged in
It is proposed to amend said sub-section (1) so as to any operations relating to prospecting for, or extraction or
express the assessee to exercise option of availing such production of, any mineral and incurs, after the 31st day of
deduction in respect of the capital expenditure incurred in March, 1970, any expenditure specified in sub-section (2),
respect of specified business during the previous year in the assessee shall, in accordance with and subject to the
which such capital expenditure is incurred. provisions of this section, be allowed for each one of the
relevant previous years a deduction of an amount equal to
Sub-section (4) of the said section,inter alia, provides one-tenth of the amount of such expenditure.
that the expenditure on which deduction has been allowed
under sub-section (1) shall not be allowed as deduction Sub-section (6) of the said section provides that where
under any other section in any previous year or under this the assessee is a person other than a company or a
section in any other previous year. co-operative society, no deduction shall be admissible under
sub-section (1) unless the accounts of the assessee for the
It is proposed to amend the said sub-section (4) so as to year or years in which the expenditure specified in
provide that no deduction in respect of the expenditure sub-section (2) is incurred have been audited by an
referred to in sub-section (1) shall be allowed to the accountant as defined in the Explanation below sub-section
assessee under any other section in any previous year or (2) of section 288 and the assessee furnishes, along with his
under this section in any other previous year, if the deduction return of income for the first year in which the deduction
has been claimed by the assessee and allowed to him under under this section is claimed, the report of such audit in the
this section. prescribed form duly signed and verified by such accountant
These amendments will take effect from 1st April, 2020 and setting forth such particulars as may be prescribed.
and will, accordingly, apply in relation to the assessment It is proposed to amend the said sub-section (6) so as to
year 2020-2021 and subsequent assessment years. provide that deduction under sub-section (1) of section 35E
Clause 19 of the Bill seeks to amend section 35D of the shall not be admissible to assessee unless the accounts of
Income-tax Act relating to amortisation of certain preliminary the assessee for the year or years in which the expenditure
expenses. specified in sub-section (2) is incurred have been audited by
an accountant as defined in the Explanation below
Sub-section (1) of the said section provides that an sub-section (2) of section 288 before the specified date
assessee, being an Indian company or a person other than a referred to section 44AB (i.e., one month prior to the due
company who is a resident in India shall be allowed date for filing of return under sub-section (1) of section 139)
deduction in relation to certain specified expenditure incurred and the report of such audit has been furnished by that date.
before the commencement of his business or in connection
with the extension of undertaking or setting up of new unit of This amendment will take effect from 1st April, 2020 and
an existing business over a period of ten successive will, accordingly, apply in relation to the assessment year
previous years beginning with the previous year in which the 2020-2021 and subsequent assessment years.
business commences or as the case may be, such extension Clause 21 of the Bill seeks to amend section 43 of the
of undertaking or setup of new unit has been carried out. Income-tax Act relating to definitions of certain terms
Sub-section (2) of the said section specifies certain relevant to income from profits and gains of business or
expenditures which are allowed as deduction under profession.
sub-section (1). It is proposed to amend clause (5) of the said section so
Sub-section (4) of the said section provides that as to substitute the words “recognised stock exchange” for
deduction under sub-section (1) shall not be admissible to the words “recognised association” wherever they occur. It is
the assessee unless the accounts of the business or also proposed to substitute clause (iii) in Explanation 2 of the
profession of the assessee for the previous year relevant to said clause relating to definition of the expression
the assessment year for which the deduction is claimed have “recognised stock exchange”.
been audited by an accountant as defined in the Explanation This amendment will take effect from 1st April, 2020.
below sub-section (2) of section 288 and the assessee
furnishes, along with his return of income, the report of such Clause 22 of the Bill seeks to amend section 43CA of
audit in the prescribed form duly signed and verified by such the Income-tax Act relating to special provision for full value
accountant for the first year of deduction. of consideration for transfer of assets other than capital
assets in certain cases.
It is proposed to amend sub-section (4) of the said
section to provide that deduction under sub-section (1) shall The proviso to sub-section (1) of the said section
not be admissible to the assessee unless the accounts of the provides that where the value adopted or assessed or
72

assessable by the authority for the purpose of payment of It is proposed to amend the said sub-section so as to
stamp duty does not exceed one hundred and five per cent. provide that the non-resident (not being a company) or a
of the consideration received or accruing as a result of the foreign company should get the accounts audited before the
transfer, the consideration so received or accruing as a specified date referred to in section 44AB (i.e. one month
result of the transfer shall, for the purposes of computing prior to the due date for filing of return under sub-section (1)
profits and gains from transfer of such asset, be deemed to of section 139) and furnish the report of audit by that date.
be the full value of the consideration received or accruing as
a result of such transfer. This amendment will take effect from 1st April, 2020 and
will, accordingly, apply in relation to the assessment year
It is proposed to amend the said proviso so as to 2020-2021 and subsequent assessment years.
provide that where the value adopted or assessed or
assessable by the authority for the purpose of payment of Clause 25 of the Bill seeks to amend section 49 of the
stamp duty does not exceed one hundred and ten per cent. Income-tax Act relating to cost with reference to certain
of the consideration received or accruing as a result of the modes of acquisition.
transfer the consideration so received or accruing as a result The said section, inter alia, provides for cost of
of transfer shall, for the purposes of computing profits and acquisition for the capital asset which became the property
gains from transfer of such asset, be deemed to be the full of the assessee under certain situations.
value of the consideration received or accruing as a result of
such transfer. It is proposed to amend the said section so as to insert
sub-sections (2AG) and (2AH) to provide that the cost of
This amendment will take effect from 1st April, 2021 and acquisition of a unit or units in the segregated portfolio shall
will, accordingly, apply in relation to assessment year be the amount which bears to the cost of acquisition of a unit
2021-2022 and subsequent years. or units held by the assessee in the total portfolio in the
Clause 23 of the Bill seeks to amend section 44AB of same proportion as the net asset value of the asset
the Income-tax Act relating to audit of accounts of certain transferred to the segregated portfolio bears to the net asset
persons carrying on business or profession. value of the total portfolio immediately before the
segregation of portfolios; and further to provide that the cost
Clause (a) of the said section provides that every of the acquisition of the original units held by the unit holder
person carrying on business shall get his accounts of any in the main portfolio shall be reduced by the amount as so
previous year audited by an accountant before the specified arrived for the units of segregated portfolio.
date and furnish by that date the report of such audit in the
prescribed form duly signed and verified by such accountant It is also proposed to give reference of the definitions of
and setting forth such particulars as may be prescribed if his the expressions “main portfolio”, “segregated portfolio” and
total sales, turnover or gross receipts, as the case may be, in “total portfolio” as provided in the circular in this behalf
business exceed or exceeds one crore rupees in any issued by the Securities and Exchange Board of India under
previous year. section 11 of the Securities and Exchange Board of India
Act, 1992 for the purposes of the said sub-sections.
It is proposed to insert a proviso in the said clause so as
to provide that in the case of a person whose aggregate of This amendment will take effect from 1st April, 2020 and
all amount received including amount received for sales, will, accordingly, apply in relation to the assessment year
turnover or gross receipts during the previous years, in cash, 2020-2021 and subsequent assessment years.
does not exceed five per cent. of the said amount; and the Clause 26 of the Bill seeks to amend section 50B of the
aggregate of all payments made including amount incurred Income-tax Act relating to special provision for computation
for expenditure, in cash, during the previous year does not of capital gains in case of slump sale.
exceed five per cent. of the said payment, this clause shall
have effect as if for the words “one crore rupees”, the words Sub-section (1) of the said section provides that any
“five crore rupees” had been substituted. profits or gains arising from the slump sale effected in the
previous year shall be chargeable to income-tax as capital
Clause (ii) of the Explanation to the said section defines gains arising from the transfer of long-term capital assets
the expression “specified date” in relation to the accounts of and shall be deemed to be the income of the previous year
the assessee of the previous year relevant to an assessment in which the transfer took place.
year as due date for furnishing the return of income under
sub-section (1) of section 139. Sub-section (3) of the said section provides that every
assessee, in the case of slump sale, shall furnish in the
It is proposed to amend the said clause so as to provide prescribed form along with the return of income, a report of
that the specified date will mean one month prior to the due an accountant as defined in the Explanation below
date for furnishing the return of income under sub-section (1) sub-section (2) of section 288 indicating the computation of
of section 139.
the net worth of the undertaking or division, as the case may
These amendments will take effect from 1st April, 2020 be, and certifying that the net worth of the undertaking or
and will, accordingly, apply in relation to the assessment division, as the case may be, has been correctly arrived at in
year 2020-2021 and subsequent assessment years. accordance with the provisions of this section.
Clause 24 of the Bill seeks to amend section 44DA of It is proposed to amend the said sub-section (3) so as to
the Income-tax Act relating to special provision for computing provide that every assessee, in the case of slump sale, shall
income by way of royalties, etc., in case of non-residents. furnish in the prescribed form a report of an accountant as
defined in the Explanation below sub-section (2) of section
Sub-section (2) of the said section provides that every 288 before the specified date as referred to in section 44AB
non-resident (not being a company) or a foreign company
(i.e. one month prior to the due date for filing return of
shall keep and maintain books of account and other
income under sub-section (1) of section 139) indicating the
documents in accordance with the provisions contained in
computation of the net worth of the undertaking or division,
section 44AA and get their accounts audited by an
as the case may be, and certifying that the net worth of the
accountant as defined in the Explanation below undertaking or division, as the case may be, has been
sub-section (2) of section 288 and furnish the report of such correctly arrived at in accordance with the provisions of this
audit in the prescribed form along with the return of income. section.
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This amendment will take effect from 1st April, 2020 and It is proposed to make a reference to section 12AB in
will, accordingly, apply in relation to the assessment year the clauses (v), (vi), (vii) and clause (x) of sub-section (2) so
2020-2021 and subsequent assessment years. as to provide that the said clauses shall not apply to any sum
of money received from any trust or institution registered
Clause 27 of the Bill seeks to amend section 50C of the under section 12AB of the Income-tax Act.
Income-tax Act relating to special provision for full value of
consideration in certain cases. These amendments will take effect from 1st June, 2020.
The third proviso to sub-section (1) of the said section Sub-clause (b) of clause (x) of sub-section (2) of the
provides that where the value adopted or assessed or said section, inter alia, provides that where any person
assessable by the stamp valuation authority does not exceed receives, any immovable property, in any previous year, from
one hundred and five per cent. of the consideration received any person or persons on or after the 1st day of April, 2017
or accruing as a result of the transfer, the consideration so for a consideration, where the stamp duty value of such
received or accruing as a result of the transfer shall, for the property exceeds five per cent. of the consideration the
purposes of section 48, be deemed to be the full value of the excess amount if it is more than fifty thousand rupees shall
consideration. be charged to tax under the head income from other
sources.
It is proposed to amend the said proviso so as to
provide that where the value adopted or assessed or It is proposed to amend the said sub-clause (b) so as to
assessable by the stamp valuation authority does not exceed provide that where any person receives, any immovable
one hundred and ten per cent. of the consideration received property, in any previous year, from any person or persons
or accruing as a result of the transfer, the consideration so on or after the 1st day of April, 2017 for a consideration,
received or accruing as a result of the transfer shall, for the where the stamp duty value of such property exceeds ten
purposes of section 48, be deemed to be the full value of the per cent. of the consideration, the excess amount if it is more
consideration. than fifty thousand rupees shall be charged to tax under the
head income from other sources.
will, accordingly, apply in relation to the assessment year This amendment will take effect from 1st April, 2021 and
2021-2022 and subsequent assessment years. will, accordingly, apply in relation to assessment year 2021-
2022 and subsequent assessment years.
Income-tax Act relating to meaning of “adjusted”, “cost of Clause 30 of the Bill seeks to amend section 57 of the
improvement” and “cost of acquisition”. Income-tax Act relating to deductions.
The said section, inter alia, provides that the cost of Clause (i) of the said section allows deduction of any
long-term capital asset acquired before the 1st day of April, reasonable sum for the purpose of realising such dividend
2001 is taken to be the cost of acquisition to the assesse or except the dividend referred to in section 115-O. It is
the fair market value of the asset on that date, at the option proposed to omit the reference of dividend referred to in
of the assessee. section 115-O.
It is proposed to insert a proviso to clause (b) of It is further proposed to insert a proviso to the said
sub-section (2) of the said section so as to provide that in section so as to provide that no deduction shall be allowed
case of a capital asset referred to in sub-clauses (i) and (ii), from the dividend income, or income in respect of units of a
being land or building or both, the fair market value of such Mutual Fund specified under clause (23D) of section 10 or
asset on the 1st day of April, 2001 for the purposes of the income in respect of units from a specified company defined
in the Explanation to clause (35) of section 10, other than
said sub-clauses shall not exceed the stamp duty value,
deduction on account of interest expense and in any
wherever available, of such asset as on the 1st day of April, previous year such deduction shall not exceed twenty per
2001. It is further proposed to define the expression “stamp cent. of the dividend income, or income in respect of such
duty value” for the purposes of the said proviso to mean the units, included in the total income for that year without
value adopted or assessed or assessable by any authority of deduction under that section.
the Central Government or a State Government for the
These amendments will take effect from 1st April, 2021
purpose of payment of stamp duty in respect of an
immovable property. year 2021-2022 and subsequent assessment years.
This amendment will take effect from 1st April, 2021 and Clause 31 of the Bill seeks to substitute section 72AA of
will, accordingly, apply in relation to the assessment year the Income-tax Act, relating to carry forward and set-off of
2021-2022 and subsequent assessment years. accumulated loss and unabsorbed depreciation allowance in
Clause 29 of the Bill seeks to amend section 56 of the scheme of amalgamation in certain cases.
Income-tax Act relating to income from other sources. It is proposed to substitute the said section so as to
Sub-section (2) of the said section provides the details provide that notwithstanding anything contained in
of the incomes which shall be chargeable to income-tax sub-clauses (i) to (iii) of clause (1B) of section 2 or section
under the head "Income from other sources". 72A, where there is an amalgamation of––
Clause (v) of said sub-section provides that where any (i) one or more banking company or companies with
sum of money exceeding twenty-five thousand rupees a banking institution under a scheme sanctioned and
received without consideration by an individual or a Hindu brought into force by the Central Government under
undivided family from any person on or after the 1st day of sub-section (7) of section 45 of the Banking Regulation
September, 2004 but before the 1st day of April, 2006, the Act, 1949; or
whole of such sum shall be chargeable to income-tax. (ii) one or more corresponding new bank or banks
Clause (g) of the first proviso to clause (vii) provides that the with any other corresponding new bank under a scheme
clause of said sub-section shall not apply to any sum of brought into force by the Central Government under
money received from any trust or institution registered under section 9 of the Banking Companies (Acquisition and
section 12AA. Transfer of Undertaking Act, 1970 or under section 9 of
74

the Banking Companies (Acquisition and Transfer of It is proposed to amend said sub-section so as to
Undertakings) Act, 1980; or provide additional conditions as under:-
(iii)one or more Government company or (a) the institution or fund prepares such statement
companies with any other Government company under for such period as may be prescribed and deliver or
a scheme sanctioned and brought into force by the cause to be delivered to the prescribed income-tax
Central Government under section 16 of the General authority or the person authorised by such authority
Insurance Business (Nationalisation) Act, 1972, such statement in such form and verified in such
manner and setting forth such particulars and within
the accumulated loss and unabsorbed depreciation of such such time as may be prescribed and it may also deliver
banking company or companies or amalgamating to the said prescribed authority a correction statement
corresponding new bank or banks or amalgamating for rectification of any mistake or to add, delete or
Government company or companies shall be deemed to be update the information furnished in the statement
the loss, or, as the case may be, allowance for depreciation delivered under this sub-section in such form and
of such banking institution or amalgamated corresponding verified in such manner as may be provided by rules;
new bank or amalgamated Government company for the and
previous year in which the scheme of amalgamation was
brought into force and other provisions of the Income-tax Act (b)the institution or fund furnishes to the donor, a
relating to set-off and carry forward of loss and allowance for certificate specifying the amount of donation in such
depreciation shall be apply accordingly. manner, containing such particulars and within such
time from the date of receipt of donation, as may be
It is further proposed to provide an Explanation to the provided by rules.
said section to define the expressions “accumulated loss”,
“banking company”, “banking institution”, “corresponding It is also proposed to insert a proviso to said
new bank”, “general insurance business”, “Government sub-section (5) so as to provide that the institution or fund
company” and “unabsorbed depreciation”. referred to in clause (vi) thereof shall make an application in
the prescribed form and manner to the Principal
This amendment will take effect from 1st April, 2020 and Commissioner or Commissioner, for grant of approval,––
2020-2021 and subsequent assessment years. (a)where the institution or fund is approved under
clause (vi)(as it stood before its amendment by the
Clause 32 of the Bill seeks to amend section 80EEA of Finance Act, 2020), within three months from the date
the Income-tax Act relating to deduction in respect of interest on which this proviso has come into force;
on loan taken for certain house property.
(b)where the institution or fund is approved and the
The aforesaid section 80EEA, inter alia, provides for period of such approval is about to expire, at least six
deduction in respect of interest on loan taken for a residential months prior to expiry of said period;
house property from any financial institution up to one lakh
fiftythousand rupees subject to the condition that the loan (c)where the institution or fund has been
has been sanctioned by the financial institution during the provisionally approved, at least six months prior to
period beginning on the 1st day of April, 2019 and ending on expiry of period of the provisional approval or within six
the 31st day of March, 2020. This is subject to further months of commencement of its activities, whichever is
condition that the stamp duty value of residential house earlier;
property does not exceed forty-five lakh rupees and the
assessee does not own any residential house property on (d)in any other case, at least one month prior to
the date of sanction of loan. commencement of the previous year relevant to the
assessment year from which said registration is sought.
It is proposed to amend the said section so as to provide
that the deduction under the said section in respect of It is also proposed to insert another proviso to
interest paid on loan sanctioned by a financial institution for sub-section (5) so as to provide that the Principal
acquisition of a residential house property, shall be available Commissioner or Commissioner, on receipt of an application
if the loan has been sanctioned during the period beginning made under the proposed first proviso, shall send a copy of
on the 1st day of April, 2019 and ending on the 31st day of order passed in writing,—
March, 2021, subject to other conditions specified in the said
section. (a)where the application is under clause (i) of the
said proviso, granting it approval for a period of five
This amendment will take effect from the 1st day of years;
April, 2021 and will, accordingly, apply in relation to the
assessment year 2021-2022 and subsequent assessment (b)where the application is under clause (ii) or
years. clause (iii) of the said proviso,––
Clause 33 of the Bill seeks to amend section 80G of the I. call for such documents or information from it or make
Income-tax Act relating to deduction in respect of donations such inquiries as he thinks necessary in order to satisfy
to certain funds, charitable institutions, etc. himself about,—
Sub-section (5) thereof provides that this section applies (A)thegenuineness of activities of such
to donations to any institution or fund referred to in institution or fund; and
sub-clause (iv) of clause (a) of sub-section (2), only if it is
(B)the fulfilment of all the conditions laid
established in India for a charitable purpose and if it fulfils
certain conditions. down in clauses (i) to (v) of sub-section (5);
and
Clause (vi) of said sub-section provides one of the
conditions to be that in relation to donations made after the II. after satisfying himself about the
31st day of March, 1992, the institution or fund is for the time genuineness of activities under item (A), and the
being approved by the Commissioner in accordance with the fulfilment of all the conditions under item (B), of
rules made in this behalf. sub-clause (a),––
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(A)granting it approval for a period of five This amendment will take effect from 1st June, 2020.
years;
Clause 35 of the Bill seeks to amend section 80-IA of
(B)if he is not so satisfied, pass an order in the Income-tax Act relating to deductions in respect of profits
writing rejecting such application and also and gains from industrial undertakings or enterprises
cancelling its approval after affording it a engaged in infrastructure development, etc.
reasonable opportunity of being heard;
Sub-section (1) of the said section provides that where
III. where the application is under clause (iv) of the gross total income of an assessee includes any profits
said proviso, granting it approval provisionally for a and gains derived by an undertaking or an enterprise from
period of three years from the assessment year any business referred to in sub-section (4)(such business
from which the registration is sought. being referred to as the eligible business), there shall, in
accordance with and subject to the provisions of the said
It is also proposed to insert another proviso to section, be allowed, in computing the total income of the
sub-section (5) so as to provide that the order under clause assessee, a deduction of an amount equal to hundred
(i), sub-clause (b) of clause (ii) and clause (iii) of proposed per cent. of the profits and gains derived from such business
first proviso shall be passed, in such form and manner as for ten consecutive assessment years.
may be prescribed, before expiry of period of three months,
six months and one month respectively, calculated from the Sub-section (7) of the said section provides that the
end of the month in which the application was received. deduction under sub-section (1) from profits and gains
derived from an undertaking shall not be admissible unless
It is also proposed to insert another proviso to the accounts of the undertaking for the previous year
sub-section (5) so as to provide that the approval granted relevant to the assessment year for which the deduction is
under the proposed second proviso shall apply to an claimed have been audited by an accountant, as defined in
institution or fund, where the application is made under,- the Explanation below sub-section (2) of section 288 and the
(a)clause(i) of the proposed first proviso, from the assessee furnishes, along with his return of income, the
assessment year from which approval was earlier report of such audit in the prescribed form duly signed and
granted to such institution or fund; verified by such accountant.
(b)clause(iii) of the proposed first proviso, from the It is proposed to amend the said sub-section (7) so as to
first of the assessment years for which such institution provide that deduction under sub-section (1) from profits and
or fund was provisionally approved; gains derived from an undertaking shall not be admissible to
the assessee unless the accounts of the undertaking for the
(c)in any other case, from the assessment year previous year relevant to the assessment year for which the
immediately following the financial year in which such deduction is claimed have been audited by an accountant as
application is made. defined in the Explanation below sub-section (2) of
section 288 before the specified date referred to in section
It is also proposed to insert a new sub-section (5E) so
44AB (i.e., one month prior to the due date for filing of return
as to provide that all applications, pending before the
under sub-section (1) of section 139) and the report of such
Commissioner on which no order has been passed under
audit is furnished by that date.
clause (vi) of sub-section (5) before the date on which this
sub-section has come into effect, shall be deemed to be an This amendment will take effect from 1st April, 2020 and
application made under clause (iv) of the first proviso of will, accordingly, apply in relation to the assessment year
sub-section (5) on that date. 2020-2021 and subsequent assessment years.
It is also proposed to insert new Explanation 2A to Clause 36 of the Bill seeks to amend section 80-IAC of
declare that assessee’s claim for a deduction in respect of the Income-tax Act relating to special provision in respect of
any donation made to an institution or fund to which sub- specified business.
section (5) applies, in the return of income for any
The provisions of section 80-IAC, inter alia, provide for a
assessment year filed by him, shall be allowed on the basis
deduction of an amount equal to hundred per cent. of the
of information relating to said donation furnished by the
profits and gains derived from an eligible business by an
institution or fund to the income-tax authority or the person eligible start-up for three consecutive assessment years out
authorised by such authority, subject to verification in of seven years at the option of the assessee and the total
accordance with the risk management strategy formulated by turnover of its business does not exceed twenty-five crore
the Board from time to time. rupees in the previous year relevant to the assessment year
These amendments will take effect from 1st June, 2020. for which deduction under this section is claimed.
Clause 34 of the Bill seeks to amend section 80GGA of It is proposed to amend the said section so as to provide
the Income-tax Act relating to deduction in respect of certain that the deduction under the said section shall be available
donations for scientific research or rural development. to an eligible start-up for a period of three consecutive
assessment years out of ten years beginning from the year
Sub-section (2A) of said section provides that no in which the eligible start-up is incorporated and the total
deduction shall be allowed under this section in respect of turnover of its business does not exceed one hundred crore
any sum exceeding ten thousand rupees unless such sum is rupees in the previous year relevant to the assessment year
paid by any mode other than cash. for which deduction under this section is claimed.
It is proposed to insert an Explanation to said section so This amendment will take effect from 1st April, 2021 and
as to declare that assessee’s claim for a deduction in respect will, accordingly, apply in relation to the assessment year
of any sum referred to in sub-section (2), in the return of 2021-2022 and subsequent assessment years.
income for any assessment year filed by him, shall be Clause 37 of the Bill seeks to amend section 80-IB of
allowed on the basis of information relating to such sum the Income-tax Act relating to deduction in respect of profits
furnished by the payee to the prescribed income-tax and gains from certain industrial undertakings other than
authority or the person authorised by such authority, subject infrastructure development undertakings.
to verification in accordance with the risk management
strategy formulated by the Board from time to time. It is proposed to consequentially amend sub-sections
(7A), (7B), (11B) and (11C) to substitute the existing phrase
76

provided therein, respectively, with the phrase “the report of previous year includes any income by way of dividends from
an audit in such form and containing such particulars, as any other domestic company, there shall, in accordance with
may be prescribed, and duly signed and verified by an and subject to the provisions of this section, be allowed in
accountant, as defined in the Explanation below sub-section computing the total income of such domestic company, a
(2) of section 288 before the specified date referred to in deduction of an amount equal to so much of the amount of
section 44AB. income by way of dividends received from such other
domestic company as does not exceed the amount of
This amendment will take effect from 1st April, 2020 and dividend distributed by the first mentioned domestic
will, accordingly, apply in relation to the assessment year company on or before the due date.
Sub-section (2) of the said section provides that where
Clause 38 of the Bill seeks to amend section 80-IBA of any deduction, in respect of the amount of dividend
the Income-tax Act relating to deductions in respect of profits distributed by the domestic company, has been allowed
and gains from housing projects. under sub-section (1) in any previous year, no deduction
The provisions of sub-section (1) of the said section shall be allowed in respect of such amount in any other
provide for hundred per cent. deduction of the profits and previous year.
gains derived from the business of developing and building It is further proposed to clarify the expression “due date”
affordable housing projects subject to certain conditions. to mean the date one month prior to the date for furnishing
Further, the provisions of clause (a) of sub-section (2) of the the return of income under sub-section (1) of section 139.
said section provide that the housing project shall be
approved by the competent authority after the 1st day of This amendment will take effect from 1st April, 2021 and
June, 2016 but on or before the 31st day of March, 2020. will, accordingly, apply in relation to the assessment year
It is proposed to amend clause (a) of said sub-section
(2) so as to allow the deduction in respect of profits and Clause 41 of the Bill seeks to amend section 90 of the
gains derived from the business of developing and building Income-tax Act relating to agreement with foreign countries
affordable housing projects for hundred per cent. of the or specified territories.
profits and gains derived from the business of developing
and building such projects approved by the competent Clause (b) of sub-section (1) of the said section provides
authority after the 1st day of June, 2016 but on or before the that the Central Government may enter into an agreement
31st day of March, 2021. with the Government of any country outside India or
specified territory outside India for the avoidance of double
This amendment will take effect from 1st April, 2021 and taxation of income under this Act and under the
will, accordingly, apply in relation to the assessment year corresponding law in force in that country or specified
2021-2022 and subsequent assessment years. territory, as the case may be.
Clause 39 of the Bill seeks to amend section 80JJAA of It is proposed to amend said clause so as to provide that
the Income-tax Act relating to deduction in respect of the Central Government shall enter into said agreement for
employment of new employees. the avoidance of double taxation without creating
opportunities for non-taxation or reduced taxation through
Sub-section (1) of the said section provides that where tax evasion or avoidance (including through treaty-shopping
the gross total income of an assessee to whom section 44AB arrangements aimed at obtaining reliefs provided in the said
applies, includes any profits and gains derived from agreement for the indirect benefit to residents of any other
business, there shall, subject to the conditions specified in country or territory).
sub-section (2), be allowed a deduction of an amount equal
to thirty per cent. of additional employee cost incurred in the This amendment will take effect from 1st April, 2021 and
course of such business in the previous year, for three will, accordingly, apply in relation to the assessment year
assessment years including the assessment year relevant to 2021-2022 and subsequent assessment years.
the previous year in which such employment is provided.
Clause 42 of the Bill seeks to amend section 90A of the
Clause (c) of sub-section (2) of the said section Income-tax Act relating to adoption by Central Government
provides that the deduction under sub-section (1) shall not of agreement between specified associations for double
be allowed unless the assessee furnishes alongwith the taxation relief.
return of income the report of the accountant, as defined in
Clause (b) of sub-section (1) of the said section provides
the Explanation to section 288 giving such particulars in the
that any specified association in India may enter into an
report as may be prescribed.
agreement with any specified association in the specified
It is proposed to amend the said clause (c) so as to territory outside India and the Central Government may, by
provide that the deduction under sub-section (1) shall not be notification in the Official Gazette, make such provisions as
allowed unless the assessee furnishes the report of the may be necessary for adopting and implementing such
accountant, as defined in the Explanation to section 288 agreementfor the avoidance of double taxation of income
before the specified date referred to in section 44AB (i.e. one under this Act and under the corresponding law in force in
month prior to the due date for filing of return under sub- that specified territory outside India.
section (1) of section 139) giving such particulars in the
It is proposed to amend said clause so as to provide that
report as may be prescribed.
the avoidance of double taxation under said agreement shall
This amendment will take effect from 1st April, 2020 be without creating opportunities for non-taxation or reduced
and will, accordingly, apply in relation to the assessment taxation through tax evasion or avoidance (including through
year 2020-2021 and subsequent assessment years. treaty-shopping arrangements aimed at obtaining reliefs
provided in the said agreement for the indirect benefit to
Clause 40 of the Bill seeks to insert new section 80M residents of any other country or territory).
relating to deduction in respect of certain inter-corporate
dividends. This amendment will take effect from 1st day of April,
2021 and will, accordingly, apply in relation to the
Sub-section (1) of the said new section provides that assessment year 2021-2022 and subsequent assessment
where the gross total income of a domestic company in any years.
77

Clause 43 of the Bill seeks to amend section 92CB of These amendments will take effect from 1st April, 2020.
the Income-tax Act relating to power of Board to make safe
harbour rules. Clause 45 of the Bill seeks to amend section 92F of the
Income-tax Act relating to definitions of certain terms
Sub-section (1) of the said section provides that the relevant to computation of arm's length price, etc.
determination of arm's length price under section 92C or
section 92CA shall be subject to safe harbour rules. Clause (iv) of the said section provides the definition of
specified date. It provides that specified date shall have the
It is proposed to substitute the said sub-section (1) so as same meaning as assigned to “due date” in Explanation 2
to provide that the determination of the income referred to in below sub-section (1) of section 139.
clause (i) of sub-section (1) of section 9 shall also be subject
to safe harbour rules. It is proposed to substitute the said clause (iv) so as to
provide that “specified date” shall mean one month prior to
This amendment will take effect from 1st April, 2020 and the due date for furnishing the return of income under sub-
will, accordingly, apply in relation to the assessment year section (1) of section 139 for the relevant assessment year.
This amendment will take effect from 1st April, 2020
Clause 44 of the Bill seeks to amend section 92CC of and will, accordingly, apply in relation to the assessment
the Income-tax Act relating to advance pricing agreement. year 2020-2021 and subsequent assessment years.
It is proposed to substitute sub-section (1) of the said Clause 46 of the Bill seeks to amend section 94B of the
section so as to provide that the Board, with the approval of Income-tax Act relating to limitation on interest deduction in
the Central Government, may enter into an advance pricing certain cases.
agreement with any person, determining the––
Sub-section (1) of said section, inter alia,provides that
(a)arm's length price or specifying the manner in notwithstanding anything contained in this Act, where an
which arm's length price is to be determined, in relation Indian company, or a permanent establishment of a foreign
to an international transaction to be entered into by that company in India, being the borrower, incurs any
person; expenditure by way of interest or of similar nature exceeding
one crore rupees which is deductible in computing income
(b) income referred to in clause (i) of sub-section (1) chargeable under the head "Profits and gains of business or
of section 9, or specifying the manner in which said profession" in respect of any debt issued by a non-resident,
income is to be determined, as is reasonably attributable being an associated enterprise of such borrower, the interest
to the operations carried out in India by or on behalf of shall not be deductible in computation of income under the
that person, being a non-resident. said head to the extent that it arises from excess interest, as
It is further proposed to substitute sub-section (2) of the specified in sub-section (2).
said section so as to provide that the manner of It is proposed to insert a new sub-section (1A) after
determination of, the arm's length price referred to in clause the said sub-section so as to provide that nothing contained
(a) of sub-section (1), or the income referred to in clause (b) in that sub-section shall apply to interest paid in respect of a
of sub-section (1), may include the methods referred to in debt issued by a lender which is a permanent establishment
sub-section (1) of section 92C or such methods provided by of a non-resident, being a person engaged in the business of
rules made under this Act with such adjustments or banking, in India.
variations, as may be necessary or expedient so to do.
This amendment will take effect from 1st April, 2021and
It is also proposed to substitute sub-section (3) of the will, accordingly, apply in relation to the assessment year
said section so as to provide that notwithstanding anything 2021-2022 and subsequent assessment years.
contained in section 92C or section 92CA or such methods
provided by rules made under this Act, the arm's length price Clause 47 of the Bill seeks to amend section 115A of
of any international transaction or the income referred to in the Income-tax Act relating to tax on dividends, royalty and
clause (b) of sub-section (1), in respect of which the advance technical service fees in the case of foreign companies.
pricing agreement has been entered into, shall be The said section, inter alia, provides for taxation of
determined in accordance with the advance pricing dividend excluding dividends referred to in section 115-O. It
agreement so entered. is proposed to omit the reference of dividends referred to in
It is also proposed to substitute sub-section (9A) of the section 115-O so that all dividend income is taxed in the
said section so as to provide that the agreement referred to hands of non-resident (not being a company) or a foreign
in sub-section (1), may, subject to such conditions, company.
procedure and manner as may be prescribed, provide for This amendment will take effect from 1st April, 2021 and
determining the– will, accordingly, apply in relation to the assessment year
(a) arm's length price or specify the manner in 2021-2022 and subsequent assessment years.
which arm's length price shall be determined in relation Sub-section (1) of the said section provides for the
to the international transaction entered into by the determination of tax in case of a non-resident whose total
person; income consists of dividends or interest payments as
(b) income referred to in clause (i) of sub-section (1) specified in clause (a) of the said sub-section and royalty or
of section 9, or specifying the manner in which the said fees for technical services as specified in clause (b) of the
income is to be determined, as is reasonably attributable said sub-section.
to the operations carried out in India by or on behalf of Sub-section (5) of the said section provides that a non-
that person, being a non-resident, resident will not be required to furnish its return of income
during any period not exceeding four previous years under sub-section (1) of section 139 of the Income-tax Act, if
preceding the first of the previous years referred to in sub- the conditions in clause (a) and clause (b) of said sub-
section (4), and the arm's length price of such international section are satisfied.
transaction or the income of such person shall be The condition under clause (a) of said sub-section
determined in accordance with the said agreement. requires that the total income of a non-resident should
78

consist only of income in the nature of dividends or interest It is proposed to amend sub-clause (i) of sub-section (2)
as referred to in clause (a) of sub-section (1) of the said of the section so as to modify this condition to provide that
section. the total income by the company shall be computed without
deduction under any provisions of Chapter VI-A other than
It is proposed to amend clause (a) of the said sub- the provisions of section 80JJAA or section 80M instead of
section so as to provide that the total income of the non- computation without deduction under any provisions of
resident should consist only of the income in the nature of Chapter VI-A under the heading "C.-Deductions in respect of
dividend or interest as referred to in clause (a) of sub-section certain incomes" other than the provisions of section
(1) of the said section or income in the nature of royalty or 80JJAA.
fee for technical services as referred to in clause (b) of sub-
section (1) of the said section. This amendment will take effect from 1st April, 2020 and
The condition under clause (b) of said sub-section 2020-2021 and subsequent assessment years.
requires that the tax deductible at source on such income as
referred to in clause (a) of sub-section (1) of the said section Clause52of the Bill seeks to amend section 115BAB of
has been deducted as per the provisions of Part B of the Income-tax Act relating to tax on income of new
Chapter XVII of the Income-tax Act. manufacturing domestic companies.
It is further proposed to amend clause (b) of the said It is proposed to amend said sub-clause (i) of
sub-section so as to provide that the tax deductible at source sub-section (2) of the aforesaid section so as to modify this
on income referred to in clause (a) or clause (b) of sub- condition to provide that the total income by the company
section (1) of the said section, has been done under the shall be computed without deduction under any provisions of
provisions of Chapter XVII at the rates which are not less Chapter VI-A other than the provisions of section 80JJAA or
than the rate specified under clause (a) or clause (b) of sub- section 80M instead of computation without deduction under
section (1) of the said section. any provisions of Chapter VI-A under the heading "C.-
Deduction in respect of certain incomes" other than the
This amendment will take effect from 1st April, 2020 and provisions of section 80JJAA.
2020-2021 and subsequent assessment years. Sub-section (1) of said section provides that the income-
tax payable by a domestic company shall be at the rate of
Clause 48 of the Bill seeks to amend section 115AC of fifteen per cent. if the conditions in sub-section (2) of the said
the Income-tax Act relating to tax on income from bonds or section are satisfied.
Global Depository Receipts purchased in foreign currency or
capital gains arising from their transfer. Sub-section (2) of said section specifies the conditions
which a domestic company needs to satisfy to be eligible to
The said section, inter-alia, provides for taxation of be taxed at the rate of fifteen per cent.
dividend excluding dividends referred to in section 115-O. It
is proposed to omit the reference of dividends referred to in It is proposed to insert an Explanation to the said
section 115-O so that all dividend income is taxed in the sub-section (2) so as to provide that “manufacturing or
hands of non-resident. production of an article or thing” for the purposes of clause
(b) of the said sub-section shall include the business of
This amendment will take effect from 1st April, 2021 and generation of electricity.
2021-2022 and subsequent assessment years. These amendments will take effect from 1st April, 2020
Clause 49 of the Bill seeks to amend section 115ACA of year 2020-2021 and subsequent assessment years.
the Income-tax Act relating to tax on income from Global
Depository Receipts purchased in foreign currency or capital Clause 53 of the Bill seeks to insert new sections
gains arising from their transfer. 115BAC in the Income-tax Act relating to tax on income of
individuals and Hindu undivided family and 115BAD relating
The said section, inter alia, provides for taxation of to tax on income of certain resident cooperative societies.
dividend excluding dividends referred to in section 115-O. It
is proposed to omit the reference of dividends referred to in Sub-section (1) of proposed new section 115BAC
section 115-O so that all dividend income is taxed in the provides that notwithstanding anything contained in this Act
hands of non-resident. but subject to the provisions of this Chapter, the income-tax
payable in respect of the total income of a person, being an
This amendment will take effect from 1st April, 2021 and individual or a Hindu undivided family, for any previous year
will, accordingly, apply in relation to the assessment year relevant to the assessment year beginning on or after the 1st
2021-2022 and subsequent assessment years. day of April, 2021, shall, at the option of such person, be
Clause 50 of the Bill seeks to amend section 115AD of computed at the rate given in the table below, if the
the Income-tax Act relating to tax on income of Foreign conditions contained in sub-section (2) are satisfied:
Institutional Investors from securities or capital gains arising
Total Income Rate
from their transfer.
UptoRs 2,50,000 Nil
The said section, interalia, provides for taxation of From Rs 2,50,001 to Rs 5,00,000 5 per cent.
dividend excluding dividends referred to in section 115-O. It From Rs 5,00,001 to Rs 7,50,000 10 per cent.
is proposed to omit the reference of income by way of From Rs 7,50,001 to Rs 10,00,000 15 per cent.
dividends referred to in section 115-O so that all dividend From Rs 10,00,001 to Rs 12,50,000 20 per cent.
income is taxed in the hands of Foreign Institutional From Rs 12,50,001 to Rs 15,00,000 25 per cent.
Investors.
Above Rs 15,00,000 30 per cent.
First proviso to said sub-section provides that where the
person fails to satisfy the conditions contained in sub-section
Clause 51 of the Bill seeks to amend section 115BAA (2) in any previous year, the option shall become invalid in
relating to tax on income of certain domestic companies. respect of the assessment year relevant to that previous
79

year and other provisions of the Act shall apply, as if the it in clause (zc) of section 2 of the Special Economic Zones
option had not been exercised for the assessment year Act, 2005.
relevant to that previous year:
Sub-section (5) of proposed section provides that
Second proviso to said sub-section provides that where nothing contained in this section shall apply unless option is
the option is exercised under clause (i) of sub-section (5), in exercised in the prescribed manner by the person,-
the event of failure to satisfy the conditions contained in sub-
section (2), it shall become invalid for subsequent (i) having business income, on or before the due
assessment years also and other provisions of the Act shall date specified under sub-section (1) of section 139 for
apply for those years accordingly. furnishing the returns of income for any previous year
relevant to the assessment year commencing on or after
Sub-section (2) of proposed section provides that for the the 1st day of April, 2021 and such option once
purposes of sub-section (1), the total income of the individual exercised shall apply to subsequent assessment years;
or Hindu undivided family shall be computed,—
(ii)having no business income, along with the return
(i) without any exemption or deduction under the of income to be furnished under sub-section (1) of
provisions of clause (5) or clause (13A) or prescribed section 139 for an assessment year:
under clause (14)(other than those as may be
prescribed for this purpose) or clause (17) or clause (32) Proviso to said sub-section (5) of the proposed section
of section 10 or section 10AA or section 16 or clause provides that the option under clause (i), once exercised for
(b) of section 24 [in respect of property referred to in any previous year can be withdrawn only once for a previous
sub-section (2) of section 23] or clause (iia) of sub- year other than the year in which it was exercised and
section (1) of section 32 or section 32AD or section thereafter, the person shall never be eligible to exercise
33AB or section 33ABA or sub-clause (ii) or sub-clause option under this section, except where such person ceases
(iia) or sub-clause (iii) of sub-section (1) or sub-section to have any business income in which case, option under
(2AA) of section 35 or section 35AD or section 35CCC clause (ii) shall be available.
or clause (iia) of section 57 or under any provisions of Sub-section (1) of the new section 115BAD provides
Chapter VI-A other than the provisions of sub-section (2) that notwithstanding anything contained in that Act but
of section 80CCD or section 80JJAA; subject to the provisions of Chapter XII, the income-tax
(ii)without set off of any loss,- payable in respect of the total income of a person, being a
co-operative society resident in India, for any previous year
(a)carried forward or depreciation from any relevant to the assessment year beginning on or after the 1st
earlier assessment year, if such loss or depreciation day of April, 2021, shall, at the option of such person, be
is attributable to any of the deductions referred to in computed at the rate of twenty-two per cent., if the conditions
clause (i); contained in sub-section (2) are satisfied.
(b)under the head “Income from House Proviso to said sub-section provides that where the
Property” with any other head of income; person fails to satisfy the conditions contained in sub-section
(2) in computing its income in any previous year, the option
(iii) by claiming the depreciation, if any, under any
provision of section 32, except clause (iia) of sub- shall become invalid in respect of the assessment year
section (1) of the said section, determined in such relevant to that previous year and subsequent assessment
manner as may be prescribed; and years and other provisions of the Act shall apply, as if the
option had not been exercised for the assessment year
(iv)without any exemption or deduction for relevant to that previous year and subsequent assessment
allowances or perquisite, by whatever name called, years.
provided under any other law for the time being in force.
Sub-section (2) of the said section provides that for the
Sub-section (3) of proposed section provides that the purposes of sub-section (1), the total income of the co-
loss and depreciation referred to in clause (ii) of sub-section operative society shall be computed,—
(2) shall be deemed to have been given full effect to and no
further deduction for such loss or depreciation shall be (i) without any deduction under the provisions of
allowed for any subsequent year: section 10AA or clause (iia) of sub-section (1) of section
32 or section 32AD or section 33AB or section 33ABA or
Proviso to said sub-section (3) provides that where there
is a depreciation allowance in respect of a block of asset sub-clause (ii) or sub-clause (iia) or sub-clause (iii) of
which has not been given full effect to prior to the sub-section (1) or sub-section (2AA) of section 35 or
assessment year beginning on the 1st day of April, 2021, section 35AD or section 35CCC or under any of the
corresponding adjustment shall be made to the written down provisions of Chapter VI-A other than the provisions of
value of such block of assets as on the 1st day of April, 2020 section 80JJAA;
in the prescribed manner, if the option under sub-section (5) (ii) without set off of any loss carried forward or
is exercised for a previous year relevant to the assessment
depreciation from any earlier assessment year, if such
year beginning on the 1st day of April, 2021.
loss or depreciation is attributable to any of the
Sub-section (4) of proposed section provides that in deductions referred to in clause (i); and
case of a person, having a Unit in the International Financial
Services Centre, as referred to in sub-section(1A) of section (iii)by claiming the depreciation, if any, under
80LA, which has exercised option under sub-section (5), the section 32, other than clause (iia) of sub-section (1) of
conditions contained in sub-section (2) shall be modified to the said section, determined in such manner as may be
the extent that the deduction under section 80LA shall be prescribed.
available to such Unit subject to fulfillment of the conditions Sub-section (3) of the said section provides that the loss
contained in the said section. and depreciation referred to in clause (ii) of sub-section (2)
Explanation to the said sub-section (4) of the proposed shall be deemed to have been given full effect to and no
section provides that for the purposes of that sub-section, further deduction for such loss or depreciation shall be
the term "Unit" shall have the same meaning as assigned to allowed for any subsequent year.
80

Proviso to the said sub-section provides that where mean any income derived other than dividends referred to in
there is a depreciation allowance in respect of a block of section 115-O from a foreign exchange asset.
asset which has not been given full effect prior to the
assessment year beginning on the 1st day of April, 2021, It is proposed to amend the said clause to omit the
corresponding adjustment shall be made to the written down reference of dividend referred to in section 115-O so as to
value of such block of assets as on the 1st day of April, 2020 define “investment income” to mean any income derived
in the manner as may be provided by rules, if the option from a foreign exchange asset.
under sub-section (5) is exercised for a previous year This amendment will take effect from 1st April, 2021 and
relevant to the assessment year beginning on the 1st day of will, accordingly, apply in relation to the assessment year
April, 2021. 2021-2022 and subsequent assessment years.
Sub-section (4) of the said section provides that in case Clause56 of the Bill seeks to amend section 115JB of
of a person, having a Unit in the International Financial the Income-tax Act relating to special provision for payment
Services Centre, as referred to in sub-section (1A) of section of tax by certain companies.
80LA, which has exercised option under sub-section (5), the
conditions contained in sub-section (2) shall be modified to Sub-section (1) of the said section provides that where
the extent that the deduction under the said section shall be in the case of an assessee, being a company, the income-
available to such Unit subject to fulfilment of the conditions tax, payable on the total income as computed under the
contained in the said section. Income-tax Act in respect of any previous year relevant to
the assessment year commencing on or after the 1st day of
Explanation to the said sub-section defines the term April, 2012, is less than eighteen and one-half per cent. of its
“Unit” to have the meaning assigned to it in clause (zc) of book profit, such book profit shall be deemed to be the total
section 2 of the Special Economic Zones Act, 2005. income of the assessee and the tax payable by the assessee
Sub-section (5) of the said section provides that nothing on such total income shall be the amount of income-tax at
contained in this section shall apply unless option is the rate of eighteen and one-half per cent.
exercised by the person in the manner as may be provided Sub-section (4) of the said section provides that every
by rules on or before the due date specified under sub- company to which the said section applies, shall furnish a
section (1) of section 139 for furnishing the returns of income report in the prescribed form from an accountant as defined
for any previous year relevant to the assessment year in the Explanation below sub-section (2) of section 288,
commencing on or after the 1st day of April, 2021 and such certifying that the book profit has been computed in
option once exercised shall apply to subsequent assessment accordance with the provisions of this section along with the
years. return of income filed under sub-section (1) of section 139 or
The proviso to the said sub-section provides that once along with the return of income furnished in response to a
the option has been exercised for any previous year, it notice under clause (i) of sub-section (1) of section 142.
cannot be subsequently withdrawn for the same or any other It is proposed to amend the said sub-section (4) so as
previous year. to provide that every company to which the said section
These amendments will take effect from 1st April, 2021 applies, shall furnish a report in the prescribed form from an
and will, accordingly, apply in relation to the assessment accountant as defined in the Explanation below sub-section
year 2021-2022 and subsequent assessment years. (2) of section 288 certifying that the book profit has been
computed in accordance with the provisions of the said
Clause54 of the Bill seeks to amend section 115BBDA section before the specified date referred to in section 44AB
of the Income-tax Act relating to tax on certain dividends (i.e. one month prior to the due date for filing of return under
received from domestic companies. sub-section (1) of section 139) or along with the return of
income furnished in response to a notice under clause (i) of
The said section provides for taxation of dividend sub-section (1) of section 142.
exceeding ten lakh rupees in the hands of specified
assessee resident in India at the rate of ten per cent. This amendment will take effect from 1st April, 2020
It is proposed to amend the said section so as to restrict year 2020-2021 and subsequent assessment years.
the applicability of the provisions of that section to dividend
declared, distributed or paid by a domestic company or Clause57 of the Bill seeks to amend section 115JC of
companies on or before the 31st day of March, 2020. the Income-tax Act relating to special provisions for payment
of tax by certain persons other than a company.
will, accordingly, apply in relation to the assessment year Sub-section (1) of the said section provides that where
2021-2022 and subsequent assessment years. the regular income-tax payable for a previous year by a
person, other than a company, is less than the alternate
Sub-clause (iii) of clause (b) of Explanation to aforesaid minimum tax payable for such previous year, the adjusted
section provides “specified assessee” for the purposes of total income shall be deemed to be the total income of that
said section, to mean a person other than a trust or person for such previous year and he shall be liable to pay
institution registered under section 12A or section 12AA. income-tax on such total income at the rate of eighteen and
It is proposed to make a reference to section 12AB in one-half per cent.
the said sub-clause so as to provide that “specified Sub-section (3) of the said section provides that every
assessee” for the purposes of said section, shall mean a person to whom the said section applies shall obtain a report
person other than a trust or institution registered under in such form as may be prescribed, from an accountant,
section 12AB, as well. certifying that the adjusted total income and the alternate
This amendment will take effect from 1st June, 2020. minimum tax have been computed in accordance with the
provisions of this Chapter and furnish such report on or
Clause55 of the Bill seeks to amend section 115C of the before the due date for furnishing of return of income under
Income-tax Act relating to definitions. sub-section (1) of section 139.
Clause (c) of the said section defines the expression It is proposed to amend the said sub-section (3) so as to
“investment income” for the purposes of Chapter XII-A to provide that every person to whom the said section applies
81

shall obtain a report before the specified date referred to in Sub-section (1) of the said section provides for payment
section 44AB (i.e. one month prior to the due date for filing of of additional income-tax on the specified date by the name
return under sub-section (1) of section 139), in such form as tax on accreted income, notwithstanding anything contained
may be prescribed, from an accountant, certifying that the in that Act, to be paid at the maximum marginal rate where in
adjusted total income and the alternate minimum tax have any previous year, a trust or institution register under section
been computed in accordance with the provisions of this 12AA has converted into any form which is not eligible for
Chapter and furnish such report by that date. grant of registration under section 12AA; merged with any
entity other than an entity which is a trust or institution having
This amendment will take effect from 1st April, 2020 objects similar to it and registered under section 12AA or
and will, accordingly, apply in relation to the assessment section 12AB; or failed to transfer upon dissolution all its
year 2020-2021 and subsequent assessment years. assets to any other trust or institution registered under
It is proposed to consequentially insert a new sub- section 12AA or to any fund or institution or trust or any
section (5) in the said section so as to provide that the university or other educational institution or any hospital or
provisions contained therein shall not apply to a person who other medical institution referred to in sub-clause (iv) or sub-
has exercised the option referred to in section 115BAC or clause (v) or sub-clause (vi) or sub-clause (via) of clause
section 115BAD. (23C) of section 10, within a period of twelve months from
the end of the month in which the dissolution takes place.
will, accordingly, apply in relation to the assessment year Other provisions of aforesaid section provides for
2021-2022 and subsequent assessment years. procedures in relation to payment of said additional income-
tax.
Clause58 of the Bill seeks to amend section 115JD of
the Income-tax Act relating to tax credit for alternate It is proposed to make a reference to section 12AB in
minimum tax. the said section, wherever the reference to section 12AA has
been made so as to provide that provisions of said section
It is proposed consequentially to insert a new sub- 115TD shall, mutatis mutandis, apply to the trust or
section (7) in said section so as to provide that the provisions institution registered under section 12AB.
contained therein shall not apply to a person who has
exercised the option referred to in section 115BAC or section This amendment will take effect from 1st June, 2020.
115BAD. Clause62 of the Bill seeks to amend section 115UA of
This amendment will take effect from 1st April, 2021 and the Income-tax Act relating to tax on income of unit holder
will, accordingly, apply in relation to the assessment year and business trust.
The said section enables pass through of the income of
Clause59 of the Bill seeks to amend section 115-O of certain nature from business trust to its unit holders. Sub-
the Income-tax Act relating tax on distributed profits of section (3) of the said section provides that if in any previous
domestic companies. year, the distributed income or any part thereof, received by
a unit holder from the business trust is of the nature as
The said section provides for levy of additional income
referred to in sub-clause (a) of clause (23FC) or clause
tax on any amount declared, distributed or paid by a (23FCA), of section 10, then, such distributed income or part
domestic company by way of dividend (whether interim or thereof shall be deemed to be the income of such unit holder
otherwise), whether out of current or accumulated profits. and shall be charged to tax as income of the previous year.
The dividend declared, distributed or paid on or after the 1st
day of April, 2003 is covered under the provisions of the said It is proposed to omit the reference of sub-clause (a) of
section. clause (23FC) of section 10 from the said sub-section so as
to provide that the distributed income of the nature as
It is proposed to amend sub-section (1) of the said referred to in clause (23FC) or clause (23FCA) of section 10
section so as to provide that dividend declared, distributed or shall be deemed to be income of unit holder and shall be
paid on or after the 1st day of April, 2003 but on or before charged to tax as income of the previous year.
the 31st day of March, 2020 shall be covered under the
provisions of the said section. This amendment will take effect from 1st April, 2021 and
This amendment will take effect from 1st April, 2021 and 2021-2022 and subsequent assessment years.
Clause63 of the Bill seeks to amend section 115VW of
the Income-tax Act relating to maintenance and audit of
Clause60 of the Bill seeks to amend section 115R of the accounts.
Income-tax Act relating to tax on distributed income to unit
holders. The said section provides for conditions to be satisfied
by a tonnage tax company to be eligible for tonnage tax
The said section, inter alia, provides for levy of scheme.
additional income-tax on any income distributed by the
specified company or a Mutual Fund to its unit holders. Clause (ii) of the said section provides one of the
condition that the company shall furnish along with the return
It is proposed to amend sub-section (2) of the said of income for that previous year, the report of an accountant,
section so as to provide that the income distributed on or in the prescribed form duly signed and verified by such
before the 31st day of March, 2020 shall only be covered accountant.
under the provisions of that section.
It is proposed to amend the said clause so as to provide
This amendment will take effect from 1st April, 2021 and that the company shall furnish the report of an accountant
will, accordingly, apply in relation to the assessment year before the specified date referred to in section 44AB (i.e. one
2021-2022 and subsequent assessment years. month prior to the due date for filing return of income under
Clause61 of the Bill seeks to amend section 115TD of sub-section (1) of section 139), in the prescribed form duly
the Income-tax Act relating to tax on accreted income. signed and verified by such accountant.
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This amendment will take effect from 1st April, 2020 and tax claimed under section 90 or section 91 on account of tax
will, accordingly, apply in relation to the assessment year paid in a country outside India, any relief of tax claimed
2020-2021 and subsequent assessment years. under section 90A on account of tax paid in any specified
territory outside India referred to in that section, and any tax
Clause 64 of the Bill seeks to insert a new section 119A credit claimed to be set off in accordance with the provisions
so as to empower the Board to adopt and declare a of section 115JAA or section 115JD, the assessee shall be
Taxpayer’s Charter and issue such orders, instructions, liable to pay such tax together with interest and fee payable
directions or guidelines to other income-tax authorities as it under any provision of this Act for any delay in furnishing the
may deem fit for the administration of such Charter. return or any default or delay in payment of advance tax,
This amendment will take effect from 1st April, 2020. before furnishing the return and the return shall be
accompanied by proof of payment of such tax, interest and
Clause 65 of the Bill seeks to amend section 133A of fee.
the Income-tax Act relating to power of survey.
It is proposed to insert a new clause (vi) in the said sub-
The proviso to the said section provides that no income- section so as to provide that where any tax is payable on the
tax authority below the rank of a Joint Director, or a Joint basis of any return required to be furnished under section
Commissioner, shall conduct any survey under 115WD or section 115WH or section 139 or section 142 or
sub-section (1) of the said section without prior approval of section 148 or section 153A or, as the case may be, section
the Joint Director or the Joint Commissioner, as the case 158BC, an assessee shall also take into account any tax or
may be. interest payable under the provisions of sub-section (2) of
It is proposed to substitute the said proviso to provide section 191.
that in a case where the information has been received from This amendment will take effect from 1st April, 2020.
such authority, as may be prescribed, no income-tax
authority below the rank of a Joint Director, or a Joint Clause69 of the Bill seeks to amend section 143 of the
Commissioner, shall conduct any survey under the said Income-tax Act relating to assessment.
section without prior approval of a Joint Director or a Joint Sub-section (3A) of the said section provides that the
Commissioner, as the case may be and in any other case, Central Government may make a scheme, by notification in
no income-tax authority below the rank of a Director or a the Official Gazette, for the purposes of making assessment
Commissioner, shall conduct any survey under the said of total income or loss of the assessee under sub-section (3)
section without prior approval of the Director or the of section 143 so as to impart greater efficiency,
Commissioner, as the case may be. transparency and accountability by certain means specified
This amendment will take effect from 1st April, 2020. therein.
Clause 66 of the Bill seeks to amend section 139 of the In order to enable assessment under section 144 under
Income-tax Act relating to return of income. the aforementioned notified scheme, it is proposed to amend
the said sub-section so as to include the reference of section
Clause (a) of Explanation(2) of sub-section (1) of the 144 of the Act in it.
said section provides for due date of furnishing of return of
income for certain persons including a working partner of the Sub-section (3B) of the said section provides that the
specified firm as the 30th day of September of the Central Government may for the purpose of giving effect to
assessment year. the scheme, by notification in the Official Gazette, direct that
any of the provisions of the Act relating to assessment of
It is proposed to amend the said clause so as to omit the
total income or loss shall not apply or shall apply with such
word “working” in sub-clause (iii) and to provide that the due
exceptions, modification and adaptations as may be
date for filling such return of income shall be the 31st day of
October of the assessment year. specified in the notification. Proviso to the said sub-section
provides that no such direction shall be issued after 31st day
These amendments will take effect from lst April, 2020 of March, 2020.
and will, accordingly, apply in relation to assessment year
2020-2021 and subsequent assessment years. It is further proposed to amend the said proviso to
provide that Central Government may issue any direction
Clause 67 of the Bill seeks to amend section 140 of the under sub-section (3B) of the said section upto 31st day of
Income-tax Act relating to return by whom to be verified. March, 2022.
The said section, inter alia, provides for who shall verify These amendments will take effect from 1st April, 2020.
the return file under section 115WD or section 139 of the
said Act. Clause70 of the Bill seeks to amend section 144C of the
Income-tax Act relating to reference to dispute resolution
It is proposed to amend the clauses (c) and (cd) of the
said section so as to empower the Board to specify by rules panel.
any other person for the said purpose in case of company Sub-section (1) of the said section provides that the
and limited liability partnership. Assessing Officer is required to forward a draft of the
These amendments will take effect from 1st April, 2020. proposed order of assessment to the eligible assessee, if he
proposes to make on or after the 1st day of October, 2009,
Clause68 of the Bill seeks to amend section 140A of the any variation in the income or loss returned which is
Income-tax Act relating to self-assessment. prejudicial to the interest of such assessee.
Sub-section (1) of the said section provides that where It is proposed to amend the said sub-section so as to
any tax is payable on the basis of any return required to be enable the eligible assessee to file his objection to dispute
furnished under section 115WD or section 115WH or section resolution panel where the Assessing Officer proposes to
139 or section 142 or section 148 or section 153A or, as the make any variation which is prejudicial to the interest of such
case may be, section 158BC, after taking into account the assessee.
amount of tax, if any, already paid under any provision of this
Act, any tax deducted or collected at source, or any relief of Clause (b) of sub-section (15) of the said section defines
tax claimed under section 89, any relief of tax or deduction of ‘eligible assessee’ for the purposes of the said section.
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It is also proposed to substitute sub-clause (ii) of the This amendment will take effect from 1st April, 2020.
said clause so as to include a non-resident, not being a
company, or a foreign company under the definition of Clause73 of the Bill seeks to amend section 192 of the
‘eligible assessee’. Income-tax Act, relating to salary.
These amendments will take effect from lst April, 2020. Sub-section (1) of the said section provides that any
person responsible for paying any income chargeable under
Clause71 of the Bill seeks to amend section 156 of the the head "Salaries" shall, at the time of payment, deduct
Income-tax Act, relating to notice of demand. income-tax on the amount payable at the average rate of
income-tax computed on the basis of the rates in force for
The said section, inter alia, provides that when any tax, the financial year in which the payment is made, on the
interest, penalty, fine or any other sum is payable in estimated income of the assessee under this head for that
consequence of any order passed under this Act, the financial year.
Assessing Officer shall serve upon the assessee a notice of
demand in such form, as may be provided by rules, Sub-section (1A) of the said section provides that
specifying the sum so payable. without prejudice to the provisions contained in sub-section
(1), the person responsible for paying any income in the
The proviso to the said section provides that where any nature of a perquisite which is not provided for by way of
sum is determined to be payable by the assessee or the monetary payment, referred to in clause (vi) of sub-section
deductor or the collector under sub-section (1) of section 143 (2) of section 17, may pay, at his option, tax on the whole or
or sub-section (1) of section 200A or sub-section (1) of part of such income without making any deduction therefrom
section 206CB, the intimation under those sub-sections shall at the time when such tax was otherwise deductible under
be deemed to be a notice of demand for the purposes of this the provisions of sub-section (1).
section.
It is proposed to insert new sub-section (1C) so as to
It is proposed to insert a sub-section (2) in the said
provide that for the purpose of deducting or paying tax under
section so as to provide that where income of the assessee
sub-section (1) or sub-section (1A), as the case may be, a
of any assessment year, beginning on or after the 1st day of
April, 2021, includes an income of the nature specified in person, being an eligible start-up referred to in section 80-
clause (vi) of sub-section (2) of section 17 and such IAC, responsible for paying any income to the assessee
specified security or sweat equity shares as referred to the being perquisite of the nature specified in clause (vi) of sub-
said clause are allotted or transferred directly or indirectly by section (2) of section 17 in any previous year relevant to the
the current employer, being an eligible start-up referred to in assessment year, beginning on or after the 1st day of April,
section 80-IAC, then tax or interest on such income included 2021, shall deduct or pay, as the case may be, tax on such
in the notice of demand shall be payable by the assessee income within fourteen days after the expiry of forty-eight
within fourteen days after the expiry of forty-eight months months from the end of the relevant assessment year; or
from the end of the relevant assessment year; or from the from the date of the sale of such specified security or sweat
date of the sale of such specified security or sweat equity equity share by the assessee; or from the date of the
share by the assessee; or from the date of the assessee assessee ceasing to be the employee of the person,
ceasing to be employee of the employer who allotted or whichever is earlier, on the basis of rates in force of the
transferred him such specified security or sweat equity financial year in which the said specified security or sweat
share, whichever is earlier. equity share is allotted or transferred.
This amendment will take effect from 1st April, 2020. This amendment will take effect from 1st April, 2020.
Clause72 of the Bill seeks to amend section 191 of the Clause74 of the Bill seeks to amend section 194 of the
Income-tax Act relating to direct payment. Income-tax Act relating to dividends.
The said section provides that in the case of income in The said section, inter alia, provides that the principal
respect of which provision is not made for deducting income- officer of an Indian company or a company which has made
tax at the time of payment, and in any case where income- the prescribed arrangements for the declaration and
tax has not been deducted in accordance with the provisions payment of dividends (including dividends on preference
of Chapter XVII, income-tax shall be payable by the shares) within India, shall, before making any payment in
assessee directly. Explanation to the said section provides cash or before issuing any cheque or warranty in respect of
that in case the assessee fails to directly pay the tax on such
any dividend or before making any distribution or payment to
income or part of it under the said section, then the person
a shareholder, who is resident in India, of any dividend within
who is required to deduct any sum in accordance with the
provisions of this Act shall be deemed to be considered as the meaning of sub-clause (a) or sub-clause (b) or sub-
an assessee in default. clause (c) or sub-clause (d) or sub-clause (e) of clause (22)
of section 2, deduct from the amount of such dividend,
It is proposed to insert sub-section (2) in the said section income-tax at the rates in force.
so as to provide that the income of the assessee in any
assessment year, beginning on or after the 1st day of April, It is proposed to amend the said section so as to bring
2021, include an income of the nature specified in clause (vi) the payment by any mode within the ambit of that section
of sub-section (2) of section 17 and such specified security and also to provide for deduction at the rate of ten per cent.
or sweat equity shares as specified in the said clause, are instead of the rates in force.
allotted or transferred directly or indirectly by the current
It is further proposed to amend the first proviso to the
employer, being an eligible start-up referred to in section 80-
said section so as to provide for payment of dividend by the
IAC, the income-tax on such income shall be payable by the
assessee within fourteen days after the expiry of forty- eight company by any mode and to increase the threshold limit
months from the end of the relevant assessment year; or thereof from two thousand five hundred rupees to five
from the date of the sale of such specified security or sweat thousand rupees.
equity share by the assessee; or from the date of the It is also proposed to consequentially omit the third
assessee ceasing to be the employee of the employer who proviso to the said section.
allotted or transferred him such specified security or sweat
equity share, whichever is earlier. These amendments will take effect from 1st April, 2020.
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Clause75 of the Bill seeks to amend section 194A of the (b)the amount of interest, or the aggregate of the
Income-tax Act relating to interest other than “Interest on amount of such interest, credited or paid, or is likely to
securities”. be credited or paid, during the financial year is more
than fifty thousand rupees in case of payee being a
Sub-section (1) of the said section provides that any senior citizen and forty thousand rupee in any other
person, not being an individual or a Hindu undivided family, case.
who is responsible for paying to a resident any income by
way of interest other than income by way of interest on It is further proposed to provide that the Explanation
securities, shall, at the time of credit of such income to the which provides for the meaning of the expression “senior
account of the payee or at the time of payment thereof in citizen” will be for the purposes of the said sub-section,
cash or by issue of a cheque or draft or by any other mode, instead of clause (i) of the said sub-section.
whichever is earlier, deduct income-tax thereon at the rates
in force. These amendments will take effect from 1st April, 2020.
The proviso to the said sub-section provides that an Clause76 of the Bill seeks to amend section 194C of the
individual or a Hindu undivided family, whose total sales, Income-tax Act relating to payments to contractors.
gross receipts or turnover from the business or profession Sub-section (1) of the said section provides that any
carried on by him exceed the monetary limits specified under person responsible for paying any sum to any resident
clause (a) or clause (b) of section 44AB during the financial (referred to as the contractor) for carrying out any work
year immediately preceding the financial year in which such (including supply of labour for carrying out any work) in
interest is credited or paid, shall be liable to deduct income- pursuance of a contract between the contractor and a
tax under this section. specified person shall, at the time of credit of such sum to
It is proposed to amend the said proviso so as to the account of the contractor or at the time of payment
provide that an individual or a Hindu undivided family, whose thereof in cash or by issue of a cheque or draft or by any
total sales, gross receipts or turnover from the business or other mode, whichever is earlier, deduct an amount equal to
profession carried on by him exceed one crore rupees in one per cent. where the payment is being made or credit is
case of business or fifty lakh rupees in case of profession being given to an individual or a Hindu undivided family; two
during the financial year immediately preceding the financial per cent. where the payment is being made or credit is being
year in which such interest is credited or paid, shall be liable given to a person other than an individual or a Hindu
to deduct income-tax under the said section. undivided family, of such sum as income-tax on income
comprised therein.
Sub-section (3) of the said section provides for
circumstances in which the provisions of sub-section (1) Item (B) of sub-clause (l) of clause (i) of the Explanation
shall not apply. to the said section provides the definition of “specified
person” to mean any person, being an individual or a Hindu
Clause (i) of sub-section (3) provides that sub-section undivided family or an association of persons or a body of
(1) shall not apply where the amount of such income or, as individuals, if such person, is liable to audit of accounts
the case may be, the aggregate of the amounts of such under clause (a) or clause (b) of section 44AB during the
income credited or paid or likely to be credited or paid during financial year immediately preceding the financial year in
the financial year by the person referred to in sub-section (1) which such sum is credited or paid to the account of the
to the account of, or to, the payee, does not exceed certain contractor.
threshold.
It is proposed to amend the said sub-clause so as to
Sub-clause (b) of the said clause provides that threshold define the expression “specified person” to mean any
to be forty thousand rupees, where the payer is a co- person, being an individual or a Hindu undivided family or an
operative society engaged in carrying on the business of association of persons or a body of individuals, if such
banking. This threshold is fifty thousand rupees, in case the person, has total sales, gross receipts or turnover from
payee is a senior citizen. business or profession carried on by him exceeding one
crore rupees in case of business or fifty lakh rupees in case
Clause (v) of sub-section (3) provides that sub-section of profession during the financial year immediately preceding
(1) shall not apply to such income credited or paid by a co- the financial year in which such sum is credited or paid to the
operative society (other than a co-operative bank) to a account of the contractor.
member thereof or to such income credited or paid by a co-
operative society to any other co-operative society. Sub-clause (e) of clause (iv) of the Explanation to the
said section defines “work” to include manufacturing or
Clause (viia) of sub-section (3) provides that sub-section supplying a product according to the requirement or
(1) shall not apply to such income credited or paid in respect specification of a customer by using raw material purchased
of, deposits with a primary agricultural credit society or a from such customer but does not include manufacturing or
primary credit society or a co-operative land mortgage bank supplying a product according to the requirement or
or a co-operative land development bank; and deposits specification of a customer by using raw material purchased
(other than time deposits made on or after the 1st day of from a person, other than such customer.
July, 1995) with a co-operative society, other than a co-
operative society or bank referred to in sub-clause (a), It is proposed to substitute the said sub-clause so as to
engaged in carrying on the business of banking. modify the definition of “work” to include manufacturing or
supplying a product according to the requirement or
It is proposed to amend sub-section (3) so as to insert a specification of a customer by using material purchased from
proviso to provide that a co-operative society referred to in such customer or its associate, being a person placed
clause (v) or clause (viia) shall be liable to deduct income-tax similarly in relation to such customer as is the person placed
in accordance with the provisions of sub-section (1), if–– in relation to the assessee under the provisions contained in
(a) the total sales, gross receipts or turnover of the clause (b) of sub-section (2) of section 40A. It is also
co-operative society exceeds fifty crore rupees during proposed to insert “or associate of such customer” in the
the financial year immediately preceding the financial long line.
year in which the interest referred to in sub-section (1) is These amendments will take effect from 1st April, 2020.
credited or paid; and
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Clause77 of the Bill seeks to amend section 194H of the services, or any remuneration or fees or commission by
Income-tax Act relating to commission or brokerage. whatever name called, other than those on which tax is
deductible under section 192, to a director of a company, or
The said section provides that any person, not being an royalty or any sum referred to in clause (va) of section 28,
individual or a Hindu undivided family, who is responsible for shall, at the time of credit or payment of such sum to the
paying, on or after the 1st day of June, 2001, to a resident, account of the payee to deduct an amount equal to ten per
any income by way of commission (not being insurance cent. as income-tax.
commission referred to in section 194D) or brokerage, shall,
at the time of credit of such income to the account of the It is proposed to amend the said sub-section so as to
payee or at the time of payment of such income in cash or by provide that any person, not being an individual or a Hindu
the issue of a cheque or draft or by any other mode, undivided family, who is responsible for paying to a resident
whichever is earlier, deduct income-tax thereon at the rate of any sum by way of fees for professional services, or fees for
five per cent . technical services, or any remuneration or fees or
commission by whatever name called, other than those on
The second proviso to the said section provides that an which tax is deductible under section 192, to a director of a
individual or a Hindu undivided family, whose total sales, company, or royalty or any sum referred to in clause (va) of
gross receipts or turnover from the business or profession section 28, shall at the time of payment or credit of such
carried on by him exceed the monetary limits specified under sum to the account of the payee, deduct an amount equal to
clause (a) or clause (b) of section 44AB during the financial two per cent. of such sum as income-tax in case of fees for
year immediately preceding the financial year in which such technical services (not being professional services) and ten
interest is credited or paid, shall be liable to deduct income- per cent. of such sum in any other case.
tax under this section.
The second proviso to the said sub-section provides that
It is proposed to amend the said proviso so as to an individual or a Hindu undivided family, whose total sales,
provide that an individual or a Hindu undivided family, whose gross receipts or turnover from the business or profession
total sales, gross receipts or turnover from business or carried on by him exceed the monetary limits specified under
profession carried on by him exceed one crore rupees in clause (a) or clause (b) of section 44AB during the financial
case of business or fifty lakh rupees in case of profession year immediately preceding the financial year in which such
during the financial year immediately preceding the financial interest is credited or paid, shall be liable to deduct income-
year in which such interest is credited or paid, shall be liable tax under this section.
to deduct income-tax under the said section.
It is proposed to amend the said proviso so as to
This amendment will take effect from 1st April, 2020. provide that an individual or a Hindu undivided family, whose
Clause78 of the Bill seeks to amend 194-I of the total sales, gross receipts or turnover from the business or
Income-tax Act relating to rent. profession carried on by him exceed one crore rupees in
case of business or fifty lakh rupees in case of profession
The said section provides that any person, not being an during the financial year immediately preceding the financial
individual or a Hindu undivided family, who is responsible for year in which such interest is credited or paid, shall be liable
paying to a resident any income by way of rent, shall, at the to deduct income-tax under the said section.
time of credit of such income to the account of the payee or
at the time of payment thereof in cash or by the issue of a These amendments will take effect from 1st April, 2020.
cheque or draft or by any other mode, whichever is earlier, Clause80 of the Bill seeks to insert a new section 194K
deduct income-tax thereon at the rate of two per cent. for the relating to income in respect of units.
use of any machinery or plant or equipment; and ten per
cent. for the use of any land or building (including factory The said section, inter alia, provides that any person
building) or land appurtenant to a building (including factory responsible for paying to a resident any income in respect
building) or furniture or fittings. of––
The second proviso to the said section provides that an (i)units of a Mutual Fund specified under clause
individual or a Hindu undivided family, whose total sales, (23D) of section 10; or
gross receipts or turnover from the business or profession
carried on by him exceed the monetary limits specified under (ii)units from the Administrator of the specified
clause (a) or clause (b) of section 44AB during the financial undertaking; or
year immediately preceding the financial year in which such (iii)units from the specified company,
interest is credited or paid, shall be liable to deduct income-
tax under the said section. shall, at the time of credit of such income to the account of
the payee or at the time of payment thereof by any mode,
It is proposed to amend the said proviso so as to whichever is earlier, deduct income-tax thereon at the rate of
provide that an individual or a Hindu undivided family, whose ten per cent.
total sales, gross receipts or turnover from business or
profession carried on by him exceed one crore rupees in It is further proposed to provide that the provisions of the
case of business or fifty lakh rupees in case of profession said section shall not apply where the amount of such
during the financial year immediately preceding the financial income or, as the case may be, the aggregate of the
year in which such income by way of rent is credited or paid, amounts of such income credited or paid or likely to be
shall be liable to deduct income-tax under the said section. credited or paid during the financial year by the person
responsible for making the payment to the account of, or to,
This amendment will take effect from 1st April, 2020.
the payee does not exceed five thousand rupees.
Clause79 of the Bill seeks to amend section 194J of the
It is also proposed to define the expressions
Income-tax Act relating to fees for professional or technical
“Administrator”, “specified company” and “specified
services.
undertaking” and to clarify that where any income referred to
Sub-section (1) of the said section provides that any in the said section is credited to any account, whether called
person, not being an individual or a Hindu undivided family, "Suspense account" or by any other name, in the books of
who is responsible for paying to a resident any sum by way account of the person liable to pay such income, such
of fees for professional services, or fees for technical crediting shall be deemed to be credit of such income to the
86

account of the payee and the provisions of this section shall listed only on a recognised stock exchange located in any
apply accordingly. International Financial Services Centre.
This amendment will take effect from 1st April, 2020. These amendments will take effect from the 1st April,
2020.
Clause 81 of the Bill seeks to amend section 194LBA of
the Income-tax Act relating to certain income from units of a Clause83 of the Bill seeks to amend section 194LD of
business trust. the Income-tax Act relating to income by way of interest on
certain bonds and Government securities.
The said section, inter alia, requires business trust to
deduct tax on distribution of income, referred to in section Sub-section (2) of the said section specifies that the
115UA, being of the nature referred to in sub-clause (a) of interest payable on or after the 1st day of July, 2013 but
clause (23FC) or clause (23FCA) of section 10, at the rate of before the 1st day of July, 2020, in respect of investments
ten per cent. to a resident and at the rate of five per cent. to made in a rupee denominated bond of an Indian company or
a non-resident (not being a company) or a foreign company, a Government security shall be eligible for lower withholding
respectively. tax of five per cent.
It is proposed to amend the said section so as to omit It is proposed to substitute the said sub-section so as to
the reference of sub-clause (a) of clause (23FC) of section provide that the concessional rate of five per cent.
10 from the said section. Thus, liability to deduct tax shall be withholding tax shall be available on the interest payable––
applicable on distribution of income referred to in section
115UA, being of the nature referred to in clause (23FC) or (i)on or after the 1st day of July, 2013 but before the
clause (23FCA) of section 10, to a resident and to a non- 1st day of July, 2023, in respect of investments made in
resident (not being a company) or a foreign company. rupee denominated bond of an Indian company or a
Government security;
It is further proposed to amend sub-section (2) of the
said section to provide that the tax is to be deducted at the (ii) on or after the 1st day of April, 2020 but before
rate of five per cent. in case of income the nature referred to the 1st day of July, 2023 in respect of investments made
in sub-clause (a) of clause (23FC) of section 10 and at the in a municipal debt securities.
rate of ten per cent. in case of income of the nature referred It is further proposed to provide that the rate of interest
to in sub-clause (b) of the said clause. in respect of rupee denominated bond of an Indian company
These amendments will take effect from 1st April, 2020. shall not exceed the rate as may be notified by the Central
Government in this behalf.
Clause82 seeks to amend section 194LC of the Income-
tax Act relating to income by way of interest from Indian It is also proposed to insert new clause (ba) in the
company. Explanation to the said section so as to define the
expression “municipal debt securities”.
Sub-section (1) of the said section provides that income-
tax at the rate of five per cent. shall be deducted on any These amendments will take effect from 1st April, 2020.
interest referred to in sub-section (2), payable by a specified Clause84 of the Bill seeks to insert a new section 194-O
company or business trust to a non-resident, in respect of in the Income-tax Act relating to payment of certain sums by
monies borrowed in foreign currency from a source outside e-commerce operator to e-commerce participants.
India.
Sub-section (1) of the said section provides that
It is proposed to insert a proviso in sub-section (1) of the notwithstanding anything to the contrary contained in any of
said section so as to provide that the withholding tax of four the provisions of Part B ofthis Chapter, where sale of goods
per cent. shall be deducted on interest referred to in or provision of services of an e-commerce participant is
clause (ib) of sub-section (2) of said section. facilitated by an e-commerce operator through its digital or
Sub-section (2) of said section specifies the interest electronic facility or platform (by whatever name called),
which is eligible for withholding tax of five per cent. on such e-commerce operator shall, at the time of credit of
borrowings made under a loan agreement at any time on or amount of sale or services or both to the account of an e-
commerce participant or at the time of payment thereof to
after the 1st day of July, 2012 but before the 1st day of July,
such e-commerce participant by any mode, whichever is
2020, through issue of long-term infrastructure bond at any
earlier, deduct income-tax at the rate of one per cent. of the
time on or after the 1st day of July, 2012 but before the 1st
gross amount of such sales or services or both. It is further
day of October, 2014, through any long-term bond including
clarified that any payment made by a purchaser of goods or
long-term infrastructure bond at any time on or after 1st day recipient of service directly to an e-commerce participant for
of October, 2014 but before the 1st day of July, 2020 or by sale of goods or provision of services or both, facilitated by
way of issue of rupee denominated bonds before the 1st day an e-commerce operator, shall be deemed to be amount
of July, 2020 subject to the approval of the Central credited or paid by the e-commerce operator to the e-
Government. commerce participant and shall be included in the gross
It is proposed to amend said sub-section (2) so as to amount of such sales or services for the purpose of
extend the period of rate of withholding tax of five per cent. deduction of income-tax under the said sub-section.
on the interest payments against borrowing made under a Sub-section (2) of the said section provides that no
loan agreement, issue of long-term bonds including deduction under sub-section (1) shall be made from any sum
infrastructure bonds and issue of rupee denominated bonds credited or paid or likely to be credited or paid during the
from the 1st day of July, 2020 to the 1st day of July, 2023. previous year to the account of an e-commerce participant,
It is also proposed to insert a new clause (ib) in sub- being an individual or Hindu undivided family, where the
section (2) of the said section so as to extend the withholding gross amount of such sales or services or both during the
tax of four per cent. on the interest payable to a non- previous year does not exceed ten lakh rupees and the e-
resident, in respect of monies borrowed in foreign currency commerce participant has furnished his Permanent Account
from a source outside India, by way of issue of any long term Number or Aadhaar number to the e-commerce operator.
bond or rupee denominated bond on or after the 1st day of Sub-section (3) of the said section provides that
April,2020 but before the 1st day of July, 2023, which is notwithstanding anything contained in Part B of this Chapter
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a transaction in respect of which tax has been deducted by These amendments will take effect from 1st April, 2020.
the e-commerce operator under sub-section (1), or is not
liable to deduction under sub-section (2), shall not be liable Clause88 of the Bill seeks to amend section 196D of the
to tax deduction at source under any other provision of Part Income-tax Act relating to income of Foreign Institutional
B of this Chapter. It is further proposed to exclude the Investors from securities.
application of the said sub-section to any amount or The said section, inter alia, provides that where any
aggregate of amounts received or receivable by an e- income in respect of securities referred to in clause (a) of
commerce operator for hosting advertisements or providing sub-section (1) of section 115AD, not being income by way
any other services which are not in connection with the sale of interest referred to in section 194LD, is payable to a
of goods or services referred to in sub-section (1). Foreign Institutional Investor, the person responsible for
The said section also provides for the definitions of the making the payment shall, at the time of credit of such
expressions “electronic commerce”, “e-commerce operator”, income to the account of the payee or at the time of payment
“e-commerce participant” and “service”. thereof in cash or by the issue of a cheque or draft or by any
other mode, whichever is earlier, deduct income-tax thereon
This amendment will take effect from 1st April, 2020. at the rate of twenty per cent.
Clause85 of the Bill seeks to amend section 195 of the It is proposed to amend sub-section (1) of the said
Income-tax Act relating to other sums. section so as to enable credit of income or payment thereof
by any mode.
The second proviso of sub-section (2) of the said
section provides that no deduction under that section shall It is further proposed to omit the proviso to the said
be made in respect of any dividends referred to in section sub-section.
115-O.
These amendments will take effect from 1st April, 2020.
It is proposed to consequentially omit the said proviso.
Clause89 of the Bill seeks to amend section 197 of the
This amendment will take effect from 1st April, 2020. Income-tax Act relating to certificate for deduction at lower
rate.
Clause86 of the Bill seeks to amend section 196A of the
Income-tax Act relating to income in respect of units of non- It is proposed to consequentially amend sub-section (1)
residents. of the said section to provide that the sums on which tax is
required to be deducted under section 194-O shall also be
Sub-section (1) of the said section provides that any eligible for certificate for deduction at lower rate.
person responsible for paying to a non-resident, not being a
company, or to a foreign company, any income in respect of This amendment will take effect from 1st April, 2020.
a Mutual Fund specified under clause (23D) of section 10 or
of the Unit Trust of India shall, at the time of credit of such Clause90 of the Bill seeks to amend section 203AA of
income to the account of the payee or at the time of payment the Income-tax Act relating to furnishing of statement of tax
thereof in cash or by the issue of a cheque or draft or by any deducted.
other mode, whichever is earlier, deduct income-tax thereon It is proposed to omit the said section.
at the rate of twenty per cent.
This amendment will take effect from 1st June, 2020.
It is proposed to amend the said sub-section to
substitute the expression “Unit Trust of India” referred to in Clause91 of the Bill seeks to amend section 204 of the
the said sub-section with “specified company referred to in Income-tax Act relating to meaning of “person responsible
the Explanation to clause (35) of section 10; and to enable for paying”.
credit of income or payment thereof by any mode. It is proposed to insert a new clause in the said section
Proviso to this sub-section provides that no deduction so as to provide that in the case of a person not resident in
shall be made under this section from any such income India, the person himself or any person authorised by such
credited or paid on or after the 1st day of April, 2003. person or the agent of such person in India including any
person treated as an agent under section 163 shall also be
It is further proposed to omit the proviso to the said sub- included within the meaning of the definition of the
section. expression “person responsible for paying” under the said
These amendments will take effect from 1st April, 2020. section.
Clause87 of the Bill seeks to amend section 196C of the This amendment will take effect from 1st April, 2020.
Income-tax Act relating to income from foreign currency Clause92 of the Bill seeks to amend section 206AA of
bonds or shares of Indian company. the Income-tax Act relating to requirement to furnish
The said section provides that where any income by Permanent Account Number.
way of interest or dividends in respect of bonds or Global It is proposed to insert a proviso in sub-section (1) of the
Depository Receipts referred to in section 115AC or by way said section so as to provide that where the tax is required to
of long-term capital gains arising from the transfer of such be deducted under section 194-O, the provisions of clause
bonds or Global Depository Receipts is payable to a non- (iii) shall apply as if for the words “twenty per cent.”, the
resident, the person responsible for making the payment words “five per cent.” had been substituted.
shall, at the time of credit of such income to the account of
the payee or at the time of payment thereof in cash or by the This amendment will take effect from 1st April, 2020.
issue of a cheque or draft or by any other mode, whichever Clause93 of the Bill seeks to amend section 206C of the
is earlier, deduct income-tax thereon at the rate of ten per Income-tax Act, relating to profits and gains from the
cent. business of trading in alcoholic liquor, forest produce, scrap,
It is proposed to amend said section so as to enable etc.
credit of income or payment thereof by any mode. Sub-section (1) of the said section provides that every
It is further proposed to omit the proviso to the said person, being a seller shall, at the time of debiting of the
section. amount payable by the buyer to the account of the buyer or
88

at the time of receipt of such amount from the said buyer in It is also proposed to define the terms "buyer" and
cash or by the issue of a cheque or draft or by any other "seller".
mode, whichever is earlier, collect from the buyer of any
goods of the specified nature a sum equal to the specified It is also proposed to amend sub-section (2) of the said
percentage, of such amount as income-tax. section so as to provide that the power to recover tax by
collection under the said section shall be without prejudice to
Clause (c) of the Explanation to the said section any other mode of recovery.
provides that the “seller” means the Central Government, a
State Government or any local authority or corporation or It is also proposed to amend sub-section (3) of the said
authority established by or under a Central, State or section so as to provide that any person collecting any
Provincial Act, or any company or firm or co-operative amount under this section shall pay within the prescribed
society and also includes an individual or a Hindu undivided time the amount so collected to the credit of the Central
family whose total sales, gross receipts or turnover from the Government or as the Board directs.
business or profession carried on by him exceed the It is also proposed to amend the first proviso to sub-
monetary limits specified under clause (a) or clause (b) of section (6A) of the said section so as to provide that any
section 44AB during the financial year immediately person who is responsible for collecting tax in accordance
preceding the financial year in which the goods of the nature with the provisions of sub-section (1) and sub-section (1C),
specified in the Table in sub-section (1) are sold. fails to collect the whole or any part of the tax on the amount
It is proposed to amend the said clause so as to received from a buyer or licensee or lessee or on the amount
provide that an individual or a Hindu undivided family, whose debited to the account of the buyer or licensee or lessee,
total sales, gross receipts or turnover from the business or shall not be deemed to be an assessee in default in respect
profession carried on by him exceed one crore rupees in of such tax, if such buyer or licensee or lessee has furnished
case of business or fifty lakh rupees in case of profession his return of income under section 139 and has taken into
during the financial year immediately preceding the financial account such amount for computing income in such return of
year in which such interest is credited or paid, shall be liable income and the person has paid the tax due on the income
to deduct income-tax under the said section. declared by him in such return of income and the person has
furnished a certificate to this effect from an accountant in
It is further proposed to insert a new sub-section (1G) in such form as provided by rules.
the said section so as to provide that every person being an
It is also proposed to define the term “seller” and restrict
authorised dealer, who receives any amount, or an
its applicability to sub-section (1) and sub-section (1F) of the
aggregate of amounts, of seven lakh rupees or more in a
said section.
financial year for remittance out of India under the
Liberalised Remittance Scheme of the Reserve Bank of India These amendments will take effect from 1st April, 2020.
from a buyer, being a person remitting such amount out of
India; or being a seller of an overseas tour program package, Clause94 of the Bill seeks to insert a new section 234G
who receives any amount from a buyer, being the person of the Income-tax Act relating to fee for default relating to
who purchases such package, shall, at the time of debiting of statement or certificate.
the amount payable by the buyer to the account of the buyer Sub-section (1) of the proposed section provides that
or at the time of receipt of such amount from the said buyer without prejudice to the provisions of that Act, where the
by any mode, whichever is earlier, collects from the buyer, a research association, university, college or other institution
sum equal to five per cent. of such amount as income-tax. or the company fails to deliver or cause to be delivered a
The provisions of the said sub-section shall not apply if the statement within the time prescribed under clause (i), or
buyer is liable to deduct tax at source under any other furnish a certificate prescribed under clause (ii) of sub-
provision of the Act and he has deducted such amount. It is section (1A) of section 35; or the institution or fund fails to
further provided that the provisions of the said sub-section deliver or cause to be delivered a statement within the time
shall not apply if the buyer is the Central Government, or a prescribed under clause (viii) of sub-section (5), or furnish a
State Government, or an embassy, or a High Commission, certificate prescribed under clause (ix) of sub-section (5) of
or a legation, a commission, a consulate, the trade section 80G; it shall be liable to pay, by way of fee, a sum of
representation of a foreign State, or a local authority as two hundred rupees for every day during which the failure
defined in the Explanation to clause (20) of section 10 or any continues.
other person notified by the Central Government for this
Sub-section (2) of the proposed section provides that
purpose subject to conditions as may be specified in that
the amount of said fee shall not exceed the amount in
notification.
respect of which the failure referred therein has occurred and
For the purposes of the said sub-section, it is also shall be paid before delivering or causing to be delivered the
proposed to define the expressions “authorised dealer” and statement mentioned in sub-section (1).
"overseas tour package". This amendment will take effect from 1st June, 2020.
It is also proposed to insert sub-section (1H), to provide Clause 95 of the Bill seeks to amend section 250 of the
that every person being a seller, who receives any amount Income-tax Act, 1961 relating to procedure in appeal.
as consideration for sale of any goods of the value or
aggregate of such value exceeding fifty lakh rupees in any It is proposed to insert new sub-sections (6B), (6C) and
previous year, other than the goods covered in (6D) in the said section so as to, inter alia, provide for a
sub-section (1) or sub-section (1F) or (1G) shall, at the time scheme, by notification in the Official Gazette, for the
of receipt of such amount, collect from the buyer, a sum disposal of appeal under section 250 so as to impart greater
equal to 0.1 per cent.of the sale consideration exceeding fifty efficiency, transparency and accountability.
lakh rupees as income-tax. It is further provided that in case
the buyer does not furnishes his PAN or Aadhaar number to This amendment will take effect from lst April, 2020.
the seller, then the tax shall be collected by the seller at the Clause96 of the Bill seeks to amend section 253 of the
rate of one per cent. Further, the provision of this sub-section Income-tax Act relating to appeals to the Appellate Tribunal.
shall not apply if the buyer is liable to deduct tax at source
under any other provision of the Act and he has deducted Sub-section (1) of the said section provides for appeal
such amount. by an assessee to the Appellate Tribunal against certain
89

orders by which he is aggrieved. Clause (c) of said section research association, university, college or other institution
provides one such order to be an order passed by a Principal referred to in clause (ii) or clause (iii) or the company
Commissioner or Commissioner under section 12AA. referred to in clause (iia) of sub-section (1), if it fails to deliver
or cause to be delivered a statement within the time
It is proposed to make a reference to section 12AB in prescribed under clause (i), or furnish a certificate prescribed
the said clause so as to provide that assessee, if he is under clause (ii) of sub-section (1A) of section 35 of the
aggrieved, may appeal to the Appellate Tribunal against Income-tax Act; or the institution or fund, if it fails to deliver
order passed by a Principal Commissioner or Commissioner or cause to be delivered a statement within the time
under section 12AB, as well. prescribed under clause (viii) of sub-section (5), or furnish a
The proposed amendment is consequential to the certificate prescribed under clause (ix) of sub-section (5) of
insertion of a new section 12AB in the Income-tax Act which section 80G.
provides the procedure for registration of a trust or institution. This amendment will take effect from 1st June, 2020.
These amendments will take effect from 1st June, 2020. Clause100 of the Bill seeks to amend section 274 of the
Clause97 of the Bill seeks to amend section 254 of the Income-tax Act relating to procedure.
Income-tax Act relating to orders of Appellate Tribunal. It is proposed to insert sub-sections (2A), (2B) and (2C)
It is proposed to amend the first proviso to sub-section in the said section so as to, inter alia, provide for a scheme,
(2A) of the said section so as to provide that no order of stay by notification in the Official Gazette, for imposing penalty
under the said proviso shall be passed by the Appellate under Chapter XXI of the Act to impart greater efficiency,
Tribunal unless the assessee has deposited not less than transparency and accountability.
twenty per cent. of the amount of tax, interest, fee, penalty, This amendment will take effect from lst April, 2020.
or any other sum payable under the provisions of this Act, or
has furnished security of equal amount in respect thereof. Clause101 of the Bill seeks to insert a new
section 285BB in the Income-tax Act relating to annual
It is further proposed to substitute the second proviso to information statement so as to provide that the prescribed
said sub-section so as to provide that no extension of stay income-tax authority or the person authorised by such
shall be granted by the Appellate Tribunal, where such authority shall upload in the registered account of the
appeal is not so disposed of within the said period of stay as assessee an annual information statement in such form and
specified in the order of stay, on an application made in this manner, within such time and along with such information,
behalf by the assessee, unless the assessee has complied which is in the possession of an income-tax authority as may
with the condition referred to in the first proviso and the be prescribed.
Appellate Tribunal is satisfied that the delay in disposing of
This amendment will take effect from 1st June, 2020.
the appeal is not attributable to the assessee, so however,
that the aggregate of the period of stay originally allowed and Clause102 of the Bill seeks to amend section 288 of the
the period of stay so extended shall not exceed three Income-tax Act relating to appearance by authorised
hundred and sixty-five days and the Appellate Tribunal shall representative.
dispose of the appeal within the period or periods of stay so
Sub-section (2) of the said section, inter alia, provides
extended or allowed.
for the definition of “authorised representative” who shall be
These amendments will take effect from lst April, 2020. entitled or required to attend before any income-tax authority
or the Appellate Tribunal in connection with any proceeding
Clause98 of the Bill seeks to insert a new section under the said Act.
271AAD in the Income-tax Act relating to penalty for false or
omission of entry in books of account. It is proposed to amend the said sub-section so as to
enable any other person, as may be provided by rules by the
It is proposed to insert a new section 271AAD, under Board to appear as an authorised representative.
which penalty shall be levied on a person who is required to
maintain books of account, if it is found that the books
contain a false entry or that any entry has been omitted Clause103 of the Bill seeks to amend section 295 of the
which is relevant for the computation of his total income. Income-tax Act relating to power to make rules.
Such person shall be liable to pay by way of penalty a sum Sub-section (1) of said section provides that the Central
equal to the aggregate amount of such false and omitted Board of Direct Taxes may, subject to the control of the
entries. Penalty shall also be levied on any other person who Central Government, by notification in the Gazette of India,
causes the person required to maintain books of account to make rules for the whole or any part of India for carrying out
make or causes to make any false entry or omit or cause the purposes that Act.
to omit any entry in books of account. The false entries shall
include use or intention to use forged or falsified documents Sub-section (2) of said section enumerates the matters
such as a false invoice or, in general, a false piece of for which the rules made under sub-section (1) may provide
for.
documentary evidence; or invoice in respect of supply or
receipt of goods or services or both issued by the person or Clause (b) of said sub-section (2) provides the matter,
any other person without actual supply or receipt of such which the rules made by the Board may provide, to be the
goods; or invoice in respect of supply or receipt of goods or manner in which and the procedure by which the income
services or both to or from a person who does not exist. shall be arrived at in certain cases.
This amendment will take effect from lst April, 2020. It is proposed to amend said clause (b) by way of
insertion of sub-clause (iia) so as to provide that the rules
Clause99 of the Bill seeks to insert a new section 271K made by the Board may provide, for the manner in which
in the Income-tax Act relating to penalty for failure to furnish and the procedure by which the income shall be arrived in
statements, etc. case of operations carried out in India by a non-resident.
The proposed section provides that without prejudice to This amendment will take effect from the 1st day of
the provisions of that Act, the Assessing Officer may direct April, 2021 and will, accordingly, apply in relation to the
that a sum not less than ten thousand rupees but extending assessment year 2021-22 and subsequent assessment
to one lakh rupees shall be paid by way of penalty by, the years.
90

It is further proposed to amend said clause (b) by way of expand the scope of the term “instrument” to include duty
insertion of sub-clause (iib) so as to provide that the rules credit issued under section 51B.
made by the Board may provide, to be the manner in which
and the procedure by which the income shall be arrived in Clause108 of the Bill seeks to insert a new Chapter VAA
case of transaction or activities of a non-resident. and a new section 28DA in the Customs Act so as to provide
for administration of rules of origin under a trade agreement
This amendment will take effect from the 1st day of and to lay down procedure regarding claim of preferential
April, 2022 and will, accordingly, apply in relation to the rate of duty on goods imported under a trade agreement
assessment year 2022-2023 and subsequent assessment entered into between the Government of India and the
years. Government of a foreign country or territory or economic
union.
Clause104 of the Bill seeks to amend rule 5 of the First
Schedule of the Income-tax Act relating to computation of Clause109 of the Bill seeks to amend the heading of
profits and gains to other insurance business. Chapter VIIA of Customs Act to insert the words “AND
ELECTRONIC DUTY CREDIT LEDGER” therein.
The said rule provides that profits and gains of any
business of insurance other than life insurance shall be Clause110 of the Bill seeks to insert a new section 51B
taken to be the profit before tax and appropriations as in Customs Act so as to provide for creation of an electronic
disclosed in the profit and loss account prepared in duty credit ledger in the customs automated system and
accordance with the provisions of the Insurance Act, 1938 or manner of its utilisation.
the rules made thereunder or the provisions of the Insurance
Regulatory and Development Authority Act, 1999 or the Clause111 of the Bill seeks to insert a new clause (q) in
regulations made thereunder, subject to the conditions that section 111 of the Customs Act so as to provide for
any expenditure debited to the profit and loss account which confiscation of improperly imported goods for contravention
is not admissible under the provisions of sections 30 to 43B of the provisions of Chapter VAA.
shall be added back; any gain or loss on realisation of Clause112 of the Bill seeks to insert a new clause (i) in
investment shall be added or deducted, as the case may be, sub-section (2) of section 156 so as to empower the Central
if the same is not credited or debited to the profit and loss Government to make rules providing for the form, time limit,
account; any provision for diminution in the value of manner, circumstances, conditions, restrictions and other
investment debited to the profit and loss account, shall be matters for carrying out the provisions of Chapter VAA.
added back.
Clause113 of the Bill seeks to amend section 157 of the
It is proposed to insert a new proviso to the said rule so Customs Act so as to empower the Board to make
as to provide that any sum payable by the assessee under regulations for the manner of maintaining electronic duty
section 43B which is added back in accordance with clause ledger, making of payment from that ledger, transfer of duty
(a) of the said rule shall be allowed as deduction in credit from ledger of one person to the ledger of another and
computing the income in the previous year in which such the conditions, restrictions and the time limit relating thereto.
sum is actually paid.
Customs Tariff
will, accordingly, apply in relation to the assessment year Clause114 of the Bill seeks to substitute section 8B of
2020-2021 and subsequent assessment years. the Customs Tariff Act so as to empower the Central
Government to apply safeguard measures including tariff-
Customs rate quota to curb increased quantity of imports of an article
Clause105 seeks to amend clause (f) of sub-section (2) to prevent serious injury to domestic industry.
of section 11 of the Customs Act so as to include any other Clause115 of the Bill seeks to amend the First Schedule
goods along with gold or silver to enable the Central to the Customs Tariff Act so as to––
Government to prohibit either absolutely or conditionally the
import or export of such goods to prevent injury to the (a)revise tariff rates in respect of certain tariff items
economy on account of uncontrolled import or export of such in the manner specified in the Second Schedule;
goods. (b)create new tariff lines in the manner specified in
the Third Schedule.
Clause106 of the Bill seeks to substitute Explanation 4
of section 28 of the Customs Act to provide that Central Goods and Services Tax
notwithstanding anything to the contrary contained in any
judgment, decree or order of the Appellate Tribunal or any Clause116 of the Bill seeks to amend clause (114) of
section 2 of the Central Goods and Services Tax Act so as to
Court or in any other provisions of this Act or the rules or
align the definition of “Union territory” in line with the Jammu
regulations made thereunder or in any other law for the time
and Kashmir Reorganisation Act, 2019 and the Dadra and
being in force, in cases where notice has been issued for Nagar Haveli and Daman and Diu (Merger of Union
non-levy, short-levy, non-payment, short-payment or Territories), Act, 2019.
erroneous refund prior to the 29th day of March, 2018, being
the date of commencement of the Finance Act, 2018, such Clause117 of the Bill seeks to amend clauses (b), (c)
notice shall continue to be governed by the provisions of and (d) of sub-section (2) of section 10 of the Central Goods
section 28 as it stood immediately before such date. This and Services Tax Act to harmonise the conditions for
amendment shall come into effect retrospectively from the eligibility for opting to pay tax under sub-section (1) and sub-
29th day of March, 2018, the date of commencement of the section (2A) of the said Act.
Finance Act, 2018. Clause 118 of the Bill seeks to amend sub-section (4) of
Clause107 of the Bill seeks to amend section 28AAA of section 16 of the Central Goods and Services Tax Act so as
the Customs Act so as to provide for recovery of duty from a to delink the date of issuance of debit note from the date of
person against utilisation of instruments issued under any issuance of the underlying invoice for purposes of availing
other law, or under any scheme of the Central Government, input tax credit.
for the time being in force, in addition to the Foreign Trade Clause 119 of the Bill seeks to amend clause (c) of sub-
(Development and Regulation) Act, 1992. It also seeks to section (1) of section 29 of the Central Goods and Services
91

Tax Act so as to provide for cancellation of registration during the period from the 1st day of July, 2017 up to 31st
obtained voluntarily under sub-section (3) of section 25. day of December, 2018 (both days inclusive).
Clause 120 of the Bill seeks to substitute the proviso to It also seeks to provide that no refund shall be made of
sub-section (1) of section 30 of the Central Goods and the tax which has already been collected.
Services Tax Act so as to empower the jurisdictional tax
authorities to extend the period provided to file an application Clause131 of the Bill seeks to give retrospective effect
for revocation of cancellation of registration. to the notification of the Government of India in the Ministry
of Finance (Department of Revenue) number G.S.R. 708(E),
Clause121 of the Bill seeks to amend section 31 of the dated the 30th September, 2019 with effect from 1st day of
Central Goods and Services Tax Act so as to empower the July, 2017.
Government to notify the categories of services or supplies
in respect of which tax invoice shall be issued and to make Integrated Goods and Services Tax
rules regarding the time and manner of its issuance. Clause132 of the Bill seeks to amend section 25 of the
Clause 122 of the Bill seeks to amend section 51 of the Integrated Goods and Services Tax Act so as to extend the
Central Goods and Services Tax Act so as to empower the time limit provided for removal of difficulties thereunder from
Government to make rules to provide for the form and three years to five years with effect from the date of
manner in which a certificate of tax deduction at source shall commencement of the said Act.
be issued. Clause 133 of the Bill seeks to provide retrospective
Clause 123 of the Bill seeks to amend sub-section (6) of exemption from integrated tax on supply of fishmeal, during
section 109 of the Central Goods and Services Tax Act so as the period from the 1st day of July, 2017 up to 30th day of
to make the provisions for Appellate Tribunal and its September, 2019 (both days inclusive).
benches thereof applicable in the Union territories of Jammu It further seeks to retrospectively levy integrated tax at
and Kashmir and Ladakh. the reduced rate of twelve per cent. on supply of pulley,
Clause124 of the Bill seeks to insert a new sub-section wheels and other parts (falling under heading 8483) and
(1A) in section 122 of the Central Goods and Services Tax used as parts of agricultural machinery of headings 8432,
Act so as to make the beneficiary of certain transactions at 8433 and 8436, during the period from the 1st day of July,
whose instance such transactions are conducted liable for 2017 up to 31st day of December, 2018 (both days
penalty. inclusive).
Clause 125 of the Bill seeks to amend section 132 of the It also seeks to provide that no refund shall be made of
Central Goods and Services Tax Act so as to make the the tax which has already been collected.
offence of fraudulent availment of input tax credit without Union Territory Goods and Services Tax
invoice or bill cognizable and non-bailable under sub-section
(1) of section 69 and to make any person who retains the Clause134 of the Bill seeks to amend section 1 of the
benefit of certain transactions and at whose instance such Union Territory Goods and Services Tax Act so as to give
transactions are conducted liable for punishment. effect to the change in the status of Union territory of Dadra
and Nagar Haveli and Union territory of Daman and Diu and
Clause126 of the Bill seeks to amend section 140 of the to make the said Act applicable to the Union territory of
Central Goods and Services Tax Act relating to transitional Ladakh.
arrangements for input tax credit, so as to prescribe the time
limit and the manner for availing input tax credit against Clause 135 of the Bill seeks to amend section 2 of the
certain unavailed credit under the existing law. This Union Territory Goods and Services Tax Act so as to align
the definition of “Union territory” in line with the Jammu and
amendment shall take effect retrospectively from the 1st day
Kashmir Reorganisation Act, 2019 and the Dadra and Nagar
of July, 2017.
Haveli and Daman and Diu (Merger of Union Territories),
Clause 127 of the Bill seeks to amend section 168 of the Act, 2019.
Central Goods and Services Tax Act so as to make
provisions for enabling the jurisdictional Commissioners to
Union Territory Goods and Services Tax Act so as to extend
exercise powers under sub-section (5) of section 66 and also the time limit provided for removal of difficulties thereunder
under second proviso to sub-section (1) of section 143. from three years to five years, with effect from the date of
Clause128 of the Bill seeks to amend section 172 of the commencement of the said Act.
Central Goods and Services Tax Act so as to extend the Clause 137 of the Bill seeks to provide retrospective
time limit provided for removal of difficulties thereunder from exemption from Union territory tax on supply of fishmeal,
three years to five years, with effect from the date of during the period from the 1st day of July, 2017 up to 30th
commencement of the said Act. day of September, 2019 (both days inclusive).
Clause 129 of the Bill seeks to amend paragraph 4 of It further seeks to retrospectively levy Union territory tax
Schedule II to the Central Goods and Services Tax Act so as at the reduced rate of six per cent. on supply of pulley,
to omit the words “whether or not for consideration” so as to wheels and other parts (falling under heading 8483) and
give clarity to the meaning of the entries (a) and (b) of said used as parts of agricultural machinery of headings 8432,
paragraph. This amendment shall take effect retrospectively 8433 and 8436, during the period from the 1st day of July,
from the 1st day of July, 2017. 2017 up to 31st day of December, 2018 (both days
Clause 130 of the Bill seeks to provide retrospective inclusive).
exemption from central tax on supply of fishmeal, during the It also seeks to provide that no refund shall be made of
period from the 1st day of July, 2017 up to 30th day of the tax which has already been collected.
September, 2019 (both days inclusive).
Goods and Services Tax (Compensation to States)
It further seeks to retrospectively levy central tax at the
reduced rate of six per cent. on supply of pulley, wheels and Clause138 of the Bill seeks to amend section 14 of the
other parts (falling under heading 8483) and used as parts of Goods and Services Tax (Compensation to States) Act so as
agricultural machinery of headings 8432, 8433 and 8436, to extend the time limit provided for removal of difficulties
92

thereunder from three years to five years with effect from the It is proposed to amend the said section so as to do
date of commencement of the said Act.
away with the income-tax exemption applicable to the Chief
Health Cess Election Commissioner and other Election Commissioners
Clause139 of the Bill seeks to provide for levy of Health on the value of rent-free residence, conveyance facilities,
Cess at the rate of 5% as duty of customs on all the goods sumptuary allowance, medical facilities and other such
specified in the Fourth Schedule.
conditions of service as are applicable to a Judge of the
Miscellaneous Supreme Court.
Clauses 140 to 142 of the Bill seeks to amend the Indian
Stamp Act, 1899, so as to––
(a) insert a proviso in sub-section (2) of section 9A
of the said Act to provide exemption from stamp-duty in
respect of instruments of transaction in stock exchanges Clause145 seeks to substitute the Seventh Schedule to
and depositories established in any International
Financial Services Centre set up under section 18 of the the Finance Act, 2001 in the manner specified in Fifth
Special Economic Zones Act, 2005; Schedule.
(b)inserta new section 73B in the said Act so as to Clause146 of the Bill seeks to amend section 116 of the
empower the Central Government to issue directions
and also to authorise the Securities and Exchange Finance Act, 2013 relating to definitions.
Board of India or the Reserve Bank of India to issue
Clause(7) of the said section defines “taxable
instructions, circulars and guidelines,retrospectively, for
carrying out the provisions of Part AA of Chapter II of commodities transaction”. It is proposed to amend the said
that Act. clause so as to insert the expressions ‘sale of option in
Clause143 of the Bill seeks to amend section 9 of the goods, and sale of commodity derivatives based on prices or
Prohibition of Benami Property Transactions Act, 1988 indices of prices of commodity derivatives’ within the ambit of
relating to qualifications for appointment of Chairperson and said definition.
Members.
Sub-section (1) of the said section provides that a It is further proposed to amend clause (8) of the said
person shall not be qualified for appointment as the section so as to substitute the expressions “Forward
Chairperson or a Member of the Adjudicating Authority Contracts (Regulation) Act, 1952 with the expressions
unless he has been a member of the Indian Revenue
Service and has held the post of Commissioner of Income- “Securities Contracts (Regulation) Act, 1956 and to insert the
tax or equivalent post in that Service; or has been a member words “notifications issued” therein.
of the Indian Legal Service and has held the post of Joint
Secretary or equivalent post in that Service. These amendments will take effect from 1st April, 2020.
It is proposed to substitute clause (b) in the said Clause147 of the Bill seeks to amend section 117 of the
sub-section so as to provide that a person who is qualified said Act relating to charge of commodities transaction tax.
for appointment as District Judge shall also be eligible for the
appointment as Chairperson or Member of the Adjudicating It is proposed to substitute the Table of the said section
Authority under the said Act.
with a new Table.
This amendment shall take effect from 1st April, 2020.
Clause148 of the Bill seeks to consequentially amend
Clause 144 seeks to amend section 8 of the Election
Commission (Conditions of Service of Election section 118 of the said Act relating to value of taxable
Commissioners and Transaction of Business) Act 1991 commodities transaction.
relating to other conditions of service.
Clause 149 of the Bill seeks to amend sections 119, 120
Section 8 provides for income-tax exemption to the
and 132A of the said Act so as to substitute the words
Chief Election Commissioner and other Election
Commissioners on the value of rent-free residence, “recognised stock exchange” for the words “recognised
conveyance facilities, sumptuary allowance, medical facilities association”.
and other such conditions of service as are applicable to
Judge of the Supreme Court under Chapter IV of the These amendments will take effect from 1st April, 2020.
Supreme Court Judges (Conditions of Service) Act, 1958
and the rules made there under.
MEMORANDUM REGARDING DELEGATED LEGISLATION
The provisions of the Bill, interalia, empower the Central Clause 33 of the Bill seeks to amend section 80G of the
Government to issue notifications and the Board to make Income-tax Act relating to deduction in respect of donations
rules for various purposes as specified therein. to certain funds, charitable institutions, etc.
Clause 5 of the Bill seeks to amend section 9 of the It is proposed to amend sub-section (5) of the said
Income-tax Act relating to income deemed to accrue or arise section so as to empower the Board to provide by rules the
in India. The proposed new Explanation 2A to the said statement, time period, form and manner of verification,
section empowers the Board to provide by rules the amount particulars and time for delivery of correction statement for
of “aggregate payments” from the transaction in respect of rectification of any mistake in the information furnished in the
any goods, services or property which shall be deemed to said statement. It is further proposed to empower the Board
accrue or arise in India. to make rules with regard to the manner, particulars and time
Clause 7 the Bill seeks to amend section 10 of the for certificate of donation.
Income-tax Act relating to incomes not included in total It is further proposed to empower the Board to make rules
income. to prescribe the form and the manner in which the order
The proposed amendment of clause (23C) of the said under clause (i), sub-clause (b) of clause (ii) and clause (iii)
section empowers the Board to provide by rules the form and of the proposed first proviso shall be passed.
the manner in which the order under clause (i), sub-clause Clause 37 of the Bill seeks to amend section 80-IB of the
(b) of clause (ii) and clause (iii) of the second proviso to be Income-tax Act relating to deduction in respect of profits and
passed. gains from certain industrial undertakings other than
The proposed new clause (23FE) in the said section infrastructure development undertakings.
empowers the Central Government to notify “such other The proposed amendments in sub-sections (7A), (7B),
business” for exemption in respect of any income of a (11B) and (11C) of the said section empowers the Board to
specified person in the nature of dividend, interest or long- provide by rules the form and particulars of the report of an
term capital gains arising from an investment made by it in audit.
India, whether in the form of debt or equity, with certain
conditions. Clause 44 of the Bill seeks to amend section 92CC of the
Income-tax Act relating to advance pricing agreement.
Clause 12 of the Bill seeks to insert new section 12AB the
Income-tax Act relating to procedure for fresh registration. The proposed new sub-section (9A) of the said section
Sub-section (3) of the proposed new section 12AB empowers the Board to make rules prescribing conditions,
empowers the Board to provide by rules the form and the procedure and manner for entering agreement referred to in
manner in which the order under the said sub-section shall sub-section (1) of the said section.
be passed.
Clause 53 of the Bill seeks to,- (i) insert a new section
Clause 13 of the Bill seeks to amend section 17 of the 115BAC relating to tax on income of individuals and Hindu
Income-tax Act relating to "Salary" "perquisite" and "profit in Undivided Family. Clause (iii) of sub-section (2) of the said
lieu of salary". The proposed amendment of the said section section provided for manner of computation of income of
empowers the Board to provide by rules the manner of individuals and Hindu Undivided Family, by claiming the
computation of income by way of interest, dividend or any depreciation if any, under any provision of section 32 except
other amount of similar nature. clause (iia) of sub-section (1) of the said section, determined
in such manner to be provided by rules. (ii) inserta new
Clause 17 of the Bill seeks to amend section 35 of the section 115BADof the Income-tax Act relating to the income
Income-tax Act relating to expenditure on scientific research. of certain registered cooperative societies.
The proposed new fifth proviso to sub-section (1) of the Proviso to sub-section (3) of the said section empowers
said section empowers the Board to provide by rules the the Board to provide by rules the manner of making
form and manner of giving intimation by the research corresponding adjustment to the written down value of block
association, university, college or company, to the prescribed of assets.
authority.
Sub-section 5 of the proposed new section empowers the
The proposed new sub-section (1A) empowers the Board Board to provide rules the manner of exercising option by the
to make rules to provide for the preparation of statements, person under the said section.
time period for such statement, form and manner of
verification, particulars and time for submission of such Clause 57 of the Bill seeks to amend section 115JC of
statements. It is further proposed to empower the Board to the Income-tax Act relating to special provisions for payment
provide by rules for the form and manner of verification of the of tax by certain persons other than a company.
correction statement thereof. It is also proposed to empower
The proposed amendment to sub-section (3)of the said
the Board to make rules with regard to the manner,
section empowers the Board to provide by rules the form in
particulars and time for certificate to be given to a donor
which the report from an accountant shall be obtained.
under the said sub-section.
Clause 65 of the Bill seeks to amend section 133A of the
Income-tax Act relating to power of survey.
Income-tax Act relating to definitions of certain terms
relevant to income from profits and gains of business or The proposed substitution of the proviso to the said
profession. section empowers the Board to provide by rules "such
authority" for receiving information under the said section.
The proposed amendment to Explanation 2 of the said
section empowers the Board to provide by rules the The proposed new sub-section (1G)of the said section
conditions to be fulfilled for a "recognised stock exchange". It empowers the Central Government to notify “any other
further empowers the Central Government to notify the person” for exemption from the application of the said sub-
same. section.
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94

Clause 67 of the Bill seeks to amend section 140 of the The proposed amendment of the said sub-section
Income-tax Act relating to return by whom to be verified. empowers the Board to provide by rules “any other person”
The proposed amendment empowers the Board to who may also appear as an authorised representative.
provide by rules "any other persons" for the purpose in the Clause 112 of the Bill seeks to amend section 156 of the
case of company and limited liability partnership. Customs Act so as to insert a new clause (i) therein, to
Clause 74 of the Bill seeks to amend section 194 of the empower the Central Government to make rules to provide
income-tax Act relating to income by way of interest on for the form, time limit, manner, circumstances, conditions,
certain bonds and Government Securities. The proposed restrictions and such other matters for carrying out the
amendment of sub-section (2) of the said section empowers provisions of Chapter VAA.
the Central Government to notify the "rate of interest" in
respect of rupee denominated bond of an Indian company. Clause 113 of the Bill seeks to amend section 157 of the
Customs Act so as to insert a new clause (ja) therein, to
Clause 93 of the Bill seeks to amend section 206C of the empower the Board to make regulations to provide for the
income-tax Act relating to profits and gains fromthe Business manner of maintaining electronic duty credit ledger, making
of trading in alcoholic liquor, forest produce, scrap, etc. payment from such ledger, transfer of duty credit from ledger
The proposed amendment seeks to empower the Central of one person to the ledger of another and the conditions,
Government to notify "any other person" to exempt from the restrictions and time limit relating thereto.
application of the provisions of newly inserted sub-section Clause 114 of the Bill seeks to substitute section 8B of
(1G) of the said section.
the Customs Tariff Act. Sub-section (10) of the said section
Clause 95 of the Bill seeks to amend section 250 of the empowers the Central Government to make rules to provide
Income-tax Act relating to procedure in appeal. for the manner in which articles liable for safeguard
measures may be identified, the manner in which the causes
The proposed new sub-section (6B)of the said section
of serious injury or causes of threat of serious injury in
empowers the Board to make scheme, by notification in the
Official Gazette, for the disposal of appeal under section 250 relation to identified article may be determined, the manner
and to empower the Central Government under sub-section of assessment and collection of safeguard duty, the manner
(6C) to issue notification to give effect to the scheme and to in which tariff-rate quota on identified article may be
give direction relating to jurisdiction and procedure for allocated among supplying countries, the manner of
disposal of appeal by Commissioner (Appeals). implementing tariff-rate quota as a safeguard measure and
any other safeguard measure and the manner of its
Clause 100 of the Bill seeks to amend section 274 of the application.
Income-tax Act relating to procedure.
The proposednew sub-section (2A)of the said section Central Goods and Services Tax Act. Sub-section (2) of the
empowers the Board to make scheme, by notification in the
said section empowers the Government to make rules to
Official Gazette, for imposing penalty under Chapter XXI of
the Act and to empower the Central Government to issue provide for the time and manner of issuing tax invoice.
notification under sub-section (2B) to give effect to the Clause 122 of the Bill seeks to amend section 51 of the
scheme and to give direction relating to jurisdiction and Central Goods and Services Tax Act.Sub-section (3) of the
procedure for imposing penalty by Income-tax authorities. said section empowers the Government to make rules to
Clause 101 of the Bill seeks to insert a new section provide for the form and manner in which a certificate of tax
285BB in the Income-tax Act relating to annual information deduction at source shall be issued.
statement to empower the Board to provide by rules the
form, manner, and the time period within which, and such
information for annual information statement shall be Central Goods and Services Tax Act with retrospective effect
uploaded by the income-tax authority. to empower the Central Government to make rules to
provide for the time limit and the manner for availing input
Clause 102 of the Bill seeks to amend section 288 of the tax credit against certain unavailed credit under the existing
Income-tax Act relating to appearance by authorised law.
representative.
2. The matters in respect of which rules may be made
Sub-section (2) of the said section, inter alia, provides for or notifications or order may be issued in accordance with
the definition of “authorised representative” who shall be the provisions of the Bill are matters of procedure and details
entitled or required to attend before any income-tax authority
and it is not practicable to provide for them in the Bill itself.
or the Appellate Tribunal in connection with any proceeding
under the said Act. 3. The delegation of legislative power is, therefore, of
a normal character.
LOK SABHA
________
BILL
to give effect to the financial proposals of the central Government

for the financial year 2020-2021
________
(Smt. Nirmala Sitharaman,

Minister of Finance.)
FINANCE BILL, 2020
PROVISIONS RELATING TO DIRECT TAXES
Introduction
The provisions of Finance Bill, 2020 (hereafter referred to as "the Bill"), relating to direct taxes seek to amend the
Income-tax Act, 1961 (hereafter referred to as 'the Act'), Prohibition of Benami Property Transactions Act, 1988 (hereafter
referred to as “PBPT Act”), and Finance Act, 2013, to continue to provide momentum to the buoyancy in direct taxes through
tax-incentives, reducing tax rates for co-operative society, individual and Hindu undivided family (HUF), deepening and
widening of the tax base, removing difficulties faced by taxpayers, curbing tax abuse and enhancing the effectiveness,
transparency and accountability of the tax administration.
With a view to achieving the above, the various proposals for amendments are organised under the following heads:—
(A) Rates of income-tax;
(B) Tax incentives;
(C) Removing difficulties faced by taxpayers;
(D) Measures to provide tax certainty;
(E) Widening and deepening of tax base;
(F) Revenue mobilisation measures;
(G) Improving effectiveness of tax administration;
(H) Preventing tax abuse; and
(I) Rationalisation of provisions of the Act.
DIRECT TAXES
A. RATES OF INCOME-TAX
I. Rates of income-tax in respect of income liable to tax for the assessment year 2020-21.
In respect of income of all categories of assessees liable to tax for the assessment year 2020-21, the rates of income-tax
have either been specified in specific sections (like section 115BAA or section 115BAB for domestic companies) or have been
specified in Part I of the First Schedule to the Bill. These are the same as those laid down in Part III of the First Schedule to the
Finance (No 2) Act, 2019, as amended by Taxation Law Amendment Act, 2019 (TLAA) for the purposes of computation of
“advance tax”, deduction of tax at source from “Salaries” and charging of tax payable in certain cases.
(1) Surcharge on income-tax
The amount of income-tax shall be increased by a surcharge for the purposes of the Union,—
(a) in the case of every individual or HUF 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 Act, not having any
income under section 115AD of the Act,—
(i) having a total income (including the income under the provisions of section 111A and 112A of the Act)
exceeding fifty lakh rupees but not exceeding one crore rupees, at the rate of ten per cent. of such income-
tax; and
(ii) having a total income (including the income under the provisions of section 111A and 112A of the Act)
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 under the provisions of section 111A and 112A of the 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 under the provisions of section 111A and 112A of the Act)
exceeding five crore rupees, at the rate of thirty-seven per cent. of such income-tax;
2
(v) having a total income (including the income under the provisions of section 111A and 112A of the Act)
exceeding two crore rupees, but is not covered under clause (iii) or (iv) above, at the rate of fifteen per cent
of such income tax:
Provided that in case where the total income includes any income chargeable under section 111A and 112A of the Act,
the rate of surcharge on the amount of income-tax computed in respect of that part of income shall not exceed fifteen per cent;
(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 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; and
(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 of the nature referred to in clause (b) of sub-section (1) of
section 115AD of the 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 of the nature referred to in clause (b) of sub-section (1) of
section 115AD of the Act] exceeding five crore rupees, at the rate of thirty-seven per cent. of such
income-tax;
(v) having a total income [including the income of the nature referred to in clause (b) of sub-section (1) of
section 115AD of the 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 chargeable under clause (b) of sub-section (1) of
section 115AD of the 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 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 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 domestic company whose income is chargeable to tax under section 115BAA or 115BAB of the Act,
at the rate of ten per cent;
(e) 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. of such income-tax, where the total income exceeds ten crore rupees;
(f) In other cases (including sections 92CE, 115-O, 115QA, 115R, 115TA or 115TD), the surcharge shall be levied at
the rate of twelve per cent.
(2) Marginal Relief—
Marginal relief has also been provided in all cases where surcharge is proposed to be imposed.
(3) Education Cess—
For assessment year 2020-21, “Health and Education Cess” is to be levied at the rate of four per cent. on the amount of
income tax so computed, inclusive of surcharge wherever applicable, in all cases. No marginal relief shall be available in
respect of such cess.
3
II. Rates for deduction of income-tax at source during the financial year (FY) 2020-21 from certain incomes other
than “Salaries”.
The rates for deduction of income-tax at source during the FY 2020-21 from certain incomes other than “Salaries” have
been specified in Part II of the First Schedule to the Bill. The rates for all the categories of persons will remain the same as
those specified in Part II of the First Schedule to the Finance (No 2) Act, 2019, for the purposes of deduction of income-tax at
source during the FY 2019-20. For sections specifying the rate of deduction of tax at source, the tax shall continue to be
deducted as per the provisions of these sections. Two new sections 194K and 194-O have been inserted specifying the rates
within the sections. Rate of section 194 has been modified from rate in force to ten per cent.
(1) Surcharge—
The amount of tax so deducted, in the case of a non-resident person (other than a company), shall be increased by a
surcharge,—
(a) in the case of every individual or HUF 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 Act, being a
non-resident, 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;
(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;
(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.
No surcharge will be levied on deductions in other cases.
(2) Education Cess—
“Health and Education Cess” shall continue to be levied at the rate of four per cent. of income tax including surcharge
wherever applicable, in the cases of persons not resident in India including company other than a domestic company.
III. Rates for deduction of income-tax at source from “Salaries”, computation of “advance tax” and charging of
income-tax in special cases during the FY 2020-21.
The rates for deduction of income-tax at source from “Salaries” during the FY 2020-21 and also for computation of
“advance tax” payable during the said year in the case of all categories of assessees have been specified in Part III of the First
Schedule to the Bill. These rates are also applicable for charging income-tax during the FY 2020-21 on current incomes in
cases where accelerated assessments have to be made, for instance, provisional assessment of shipping profits arising in
India to non-residents, assessment of persons leaving India for good during the financial year, assessment of persons who are
likely to transfer property to avoid tax, assessment of bodies formed for a short duration, etc. New provisions are inserted for
tax rates in respect of individual or HUF (section 115BAC of the Act) and resident co-operative societies (section 115 BAD of
the Act) with an option to these taxpayers. The salient features of the rates specified in the said Part III are indicated in the
following paragraphs-
4
A. Individual, HUF, association of persons, body of individuals, artificial juridical person.
Paragraph A of Part-III of First Schedule to the Bill provides following rates of income-tax:—
(i) The rates of income-tax in the case of every individual (other than those mentioned in (ii) and (iii) below) or HUF 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 Act (not being a case to which any other Paragraph
of Part III applies) are as under:—
Upto Rs. 2,50,000 Nil.
Rs. 2,50,001 to Rs. 5,00,000 5 per cent.
Rs. 5,00,001 to Rs. 10,00,000 20 per cent.
(ii) 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,—
Upto Rs.3,00,000 Nil.
Rs. 3,00,001 to Rs. 5,00,000 5 per cent.
Rs. 5,00,001 to Rs. 10,00,000 20 per cent.
(iii) 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,—
Upto Rs. 5,00,000 Nil.
Rs. 5,00,001 to Rs. 10,00,000 20 per cent.
The amount of income-tax computed in accordance with the preceding provisions of this Paragraph (including capital
gains under section 111A, 112 and 112A) as well as income tax computed under section 115BAC, shall be increased by a
surcharge at the rate of,—
(a) having a total income (including the income under the provisions of section 111A and 112A of the Act) exceeding
fifty lakh rupees but not exceeding one crore rupees, at the rate of ten per cent. of such income-tax;
(b) having a total income (including the income under the provisions of section 111A and 112A of the Act) exceeding
one crore rupees, at the rate of fifteen per cent. of such income-tax;
(c) having a total income (excluding the income under the provisions of section 111A and 112A of the Act) exceeding
two crore rupees but not exceeding five crore rupees, at the rate of twenty-five per cent. of such income-tax;
(d) having a total income (excluding the income under the provisions of section 111A and 112A of the Act) exceeding
five crore rupees, at the rate of thirty-seven per cent. of such income-tax;
(e) having a total income (including income under the provisions of section 111A and section 112A of the Act)
exceeding two crore rupees, but is not covered under clauses (c) and (d), shall be applicable at the rate of fifteen
Provided that in case where the total income includes any income chargeable under section 111A and section 112A of the
Act, the rate of surcharge on the amount of Income-tax computed in respect of that part of income shall not exceed fifteen
per cent..
5
Marginal relief is provided in cases of surcharge.

From the assessment year 2021-22 (FY 2020-21), individual and HUF tax payers have an option to opt for taxation under
the newly inserted section 115BAC of the Act and the resident co-operative society has an option to opt for taxation under the
newly inserted section 115BAD of the Act. This is discussed later.
B. Co-operative Societies
In the case of co-operative societies, the rates of income-tax have been specified in Paragraph B of Part III of the First
Schedule to the Bill. These rates will continue to be the same as those specified for FY 2019-20. The amount of income-tax
shall be increased by a surcharge at the rate of twelve per cent. of such income-tax in case of a co-operative society having a
total income exceeding one crore rupees. However, the total amount payable as income-tax and surcharge on total income
exceeding one crore rupees 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.
From the assessment year 2021-22, resident co-operative societies have an option to opt for taxation under newly
inserted section 115BAD of the Act. This is discussed later.
C. Firms
In the case of firms, the rate of income-tax has been specified in Paragraph C of Part III of the First Schedule to the Bill.
This rate will continue to be the same as that specified for FY 2019-20. The amount of income-tax shall be increased by a
surcharge at the rate of twelve per cent. of such income-tax in case of a firm having a total income exceeding one crore
rupees. However, the total amount payable as income-tax and surcharge on total income exceeding one crore rupees 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.
D. Local authorities
The rate of income-tax in the case of every local authority has been specified in Paragraph D of Part III of the First
Schedule to the Bill. This rate will continue to be the same as that specified for the FY 2019-20. The amount of income-tax
shall be increased by a surcharge at the rate of twelve per cent. of such income-tax in case of a local authority having a total
income exceeding one crore rupees. However, the total amount payable as income-tax and surcharge on total income
exceeding one crore rupees 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.
E. Companies
The rates of income-tax in the case of companies have been specified in Paragraph E of Part III of the First Schedule to
the Bill. In case of domestic company, the rate of income-tax shall be twenty five per cent. of the total income, if the total
turnover or gross receipts of the previous year 2018-19 does not exceed four hundred crore rupees and in all other cases the
rate of Income-tax shall be thirty per cent. of the total income. However, domestic companies also have an option to opt for
taxation under section 115BAA or section 115BAB of the Act on fulfilment of conditions contained therein. The tax rate is 15
per cent. in section 115BAB and 22 per cent. in section 115BAA. Surcharge is 10 per cent. in both cases.
In the case of company other than domestic company, the rates of tax are the same as those specified for the FY 2019-20.
Surcharge at the rate of seven per cent. shall continue to be levied in case of a domestic company (except those opting
for taxation under section 115BAA and section 115BAB of the Act), if the total income of the domestic company exceeds one
crore rupees but does not exceed ten crore rupees. Surcharge at the rate of twelve per cent shall continue to be levied, if the
total income of the domestic company (except those opting for taxation under section 115BAA and section 115BAB of the Act)
exceeds ten crore rupees.
In case of companies other than domestic companies, the existing surcharge of two per cent shall continue to be levied, if
the total income exceeds one crore rupees but does not exceed ten crore rupees. Surcharge at the rate of five per cent shall
continue to be levied, if the total income of the company other than domestic company exceeds ten crore rupees.
Marginal relief is provided in surcharge in all cases.
In other cases [including sub-section (2A) of section 92CE, sections 115-O, 115QA, 115R, 115TA or 115TD], the
surcharge shall be levied at the rate of twelve per cent..
For FY 2020-21, additional surcharge called the “Health and Education Cess on income-tax” shall be levied at the rate of
four per cent on the amount of tax computed, inclusive of surcharge (wherever applicable), in all cases. No marginal relief shall
be available in respect of such cess.
[Clause 2 & the First Schedule]
6
IV Other amendments having impact on rates for various categories of person

A. Incentives to resident co-operative societies.
The TLAA, which replaced The Taxation Laws (Amendment) Ordinance, 2019, sought to provide additional fiscal stimulus
to attract investment, generate employment and boost the economy in the wake of economic developments post enactment of
the Finance (No. 2) Act, 2019 and keeping in view the reduction of rate of corporate income tax by many countries world over.
TLAA, inter alia, introduced section 115BAA in the Act so as to provide that an existing domestic company may opt to pay tax
at 22 per cent., if it does not claim any incentive and deduction as provided in said section.
In case of the domestic company opting to pay tax at the rate of 22 per cent. under said section, it was provided that,-
(a) failure to satisfy specified conditions would disqualify it for the concessional rate and normal provisions of the Act
shall apply.
(b) deemed loss or depreciation arising out of amalgamation attributable to any incentive, deduction or exemption,
shall not be allowed in computation of income.
(c) for FY 2020-21, where there is unabsorbed depreciation allowance in respect of a block of asset which has not
been given full effect to in earlier FYs, corresponding adjustment shall be made to the written down value of such
block of assets as on 1st April, 2020.
(d) it shall be entitled to deduction under section 80LA of the Act, subject to fulfilment of conditions contained therein,
in respect of a Unit in the International Financial Services Centre, if any.
It was also provided that such company shall not be subjected to Minimum Alternate Tax (MAT) under section 115JB
of the Act and that, the carry forward and set off of MAT credit, if any, under section 115JAA of the Act would not be allowed.
Representations have been received from the stakeholders requesting to provide for concessional rate of tax in case of
resident co-operative society on similar lines. In view of the above, it is proposed to insert a new section (115BAD) in the Act to
provide that,-
(i) notwithstanding anything contained in the Act but subject to the provisions of Chapter XII and satisfaction
of certain conditions, a co-operative society resident in India shall have the option to pay tax at 22 per
cent. for assessment year 2021-22 onwards in respect of its total income so however that if it fails to
satisfy the conditions in any previous year, the option shall become invalid and other provisions of the Act
shall apply;
(ii) the condition for concessional rate shall be that the total income of the co-operative society is computed,—
(a) without any deduction under the provisions of section 10AA or clause (iia) of sub-section (1) of section 32 or
section 32AD or section 33AB or section 33ABA or sub-clause (ii) or sub-clause (iia) or sub-clause (iii) of
sub-section (1) or sub-section (2AA) of section 35 or section 35AD or section 35CCC or under any provisions of
Chapter VI-A;
(b) without set off of any loss carried forward or depreciation from any earlier assessment year, if such loss or
depreciation is attributable to any of the deductions referred to in (a) above; and
(c) by claiming the depreciation, if any, under section 32, except clause (iia) of sub-section (1) thereof, determined in
such manner as may be prescribed;
(iii) the loss and depreciation referred to in (ii)(b) above shall be deemed to have been given full effect to and no
further deduction for such loss or depreciation shall be allowed for any subsequent year. However, where
there is a depreciation allowance in respect of a block of asset which has not been given full effect to prior to
the assessment year beginning on 1st April, 2021, corresponding adjustment shall be made to the written
down value of such block of assets as on 1st April, 2020 in the prescribed manner, if the option is exercised
for a previous year relevant to the assessment year beginning on 1st April, 2021;
(iv) the concessional rate shall not apply unless option is exercised by the co-operative society in the prescribed
manner on or before the due date specified under sub-section (1) of section 139 of the Act for furnishing the
returns of income for any previous year relevant to the assessment year commencing on or after 1st April,
2021 and such option once exercised shall apply to subsequent assessment years;
(v) if the person has a Unit in the International Financial Services Centre (IFSC), as referred to in sub-section
(1A) of section 80LA, the deduction under section 80LA shall be available to such Unit subject to fulfilment of
the conditions contained in that section; and
(vi) the option so exercised cannot be withdrawn;
(vii) The surcharge applicable to such co-operative society shall be levied at 10 per cent..
It is further proposed to amend section 115JC of the Act so as to provide that the provisions relating to Alternate Minimum
Tax (AMT) shall not apply to such co-operative society.
7
It is also proposed to amend section 115JD of the Act so as to provide that the provisions relating to carry forward and set
off of AMT credit, if any, shall not apply to such co-operative society.
This amendment will take effect from 1st April, 2021 and will, accordingly, apply in relation to the assessment year
[Clauses 53, 57 & 58]
B. Incentives to Individual and HUF.
In line with options provided to domestic companies under the TLAA and proposed to be provided to resident co-operative
societies under this Bill, it is also proposed to provide similar option to individual and HUF by insertion of section 115BAC in
the Act, which provides the following:-
(i) On satisfaction of certain conditions, an individual or HUF shall, from assessment year 2021-22 onwards, have the
option to pay tax in respect of the total income at following rates:
Total Income (Rs) Rate
Upto 2,50,000 Nil
From 2,50,001 to 5,00,000 5 per cent.
From 5,00,001 to 7,50,000 10 per cent.
From 7,50,001 to 10,00,000 15 per cent.
From 10,00,001 to 12,50,000 20 per cent.
From 12,50,001 to 15,00,000 25 per cent.
Above 15,00,000 30 per cent.
(ii) The option shall be exercised for every previous year where the individual or the HUF has no business income, and
in other cases the option once exercised for a previous year shall be valid for that previous year and all subsequent
years.
(iii) The option shall become invalid for a previous year or previous years, as the case may be, if the Individual or HUF
fails to satisfy the conditions and other provisions of the Act shall apply;
(iv) the condition for concessional rate shall be that the total income of the individual or HUF is computed,—
(a) without any exemption or deduction under the provisions of clause (5) or clause (13A) or prescribed under
clause (14) (other than those as may be prescribed for this purpose) or clause (17) or clause (32) of section
10 or section 10AA or section 16 or clause (b) of section 24 [in respect of property referred to in sub-section
(2) of section 23] or clause (iia) of sub-section (1) of section 32 or section 32AD or section 33AB or section
33ABA or sub-clause (ii) or sub-clause (iia) or sub-clause (iii) of sub-section (1) or sub-section (2AA) of
section 35 or section 35AD or section 35CCC or clause (iia) of section 57 or under any provisions of
Chapter VI-A other than the provisions of sub-section (2) of section 80CCD or section 80JJAA;
(b) without set off of any loss,-
(i) carried forward or depreciation from any earlier assessment year, if such loss or depreciation is
attributable to any of the deductions referred to in (a) above; or
(ii) under the head house property with any other head of income;
(c) by claiming the depreciation, if any, under section 32, except clause (iia) of sub-section (1) thereof,
determined in such manner as may be prescribed; and
(d) without any exemption or deduction for allowances or perquisite, by whatever name called, provided under
any other law for the time being in force.
(v) the loss and depreciation referred to in (ii)(b) above shall be deemed to have been given full effect to and no further
deduction for such loss or depreciation shall be allowed for any subsequent year so however, that where there is a
depreciation allowance in respect of a block of asset which has not been given full effect to prior to the assessment
year beginning on 1st April, 2021, corresponding adjustment shall be made to the written down value of such block
of assets as on 1st April, 2020 in the prescribed manner, if the option is exercised for a previous year relevant to
the assessment year beginning on 1st April, 2021;
(vi) the concessional rate shall not apply unless option is exercised by the individual or HUF in the form and manner as
may be prescribed,-
a. where such individual or HUF has no business income, along with the return of income to be furnished
under sub-section (1) of section 139 of the Act; and
8
b. in any other case, on or before the due date specified under sub-section (1) of section 139 of the Act for
furnishing the return of income for any previous year relevant to the assessment year commencing on or
after 1st April, 2021 and such option once exercised shall apply to subsequent assessment years;
(vii) if the individual or HUF has a Unit in the International Financial Services Centre [clause (zc) of section 2 of the
Special Economic Zones Act, 2005], as referred to in sub-section (1A) of section 80LA, the deduction under section
80LA shall be available to such Unit subject to fulfilment of the conditions contained in that section; and
(viii) the option can be withdrawn only once where it was exercised by the individual or HUF having business income for
a previous year other than the year in which it was exercised and thereafter, the individual or HUF shall never be
eligible to exercise option under this section, except where such individual or HUF ceases to have any business
income in which case, option under para (vi)(a) above shall be available.
It is further proposed to amend section 115JC of the Act so as to provide that the provisions relating to AMT shall not
apply to such individual or HUF having business income.
It is also proposed to amend section 115JD of the Act so as to provide that the provisions relating to carry forward and set
off of AMT credit, if any, shall not apply to such individual or HUF having business income.
The condition listed at (iva) above, means that the individual or HUF opting for taxation under the newly inserted section
115BAC of the Act shall not be entitled to the following exemptions/ deductions:
(i) Leave travel concession as contained in clause (5) of section 10;
(ii) House rent allowance as contained in clause (13A) of section 10;
(iii) Some of the allowance as contained in clause (14) of section 10;
(iv) Allowances to MPs/MLAs as contained in clause (17) of section 10;
(v) Allowance for income of minor as contained in clause (32) of section 10;
(vi) Exemption for SEZ unit contained in section 10AA;
(vii) Standard deduction, deduction for entertainment allowance and employment/professional tax as contained in
section 16;
(viii) Interest under section 24 in respect of self-occupied or vacant property referred to in sub-section (2) of section 23.
(Loss under the head income from house property for rented house shall not be allowed to be set off under any
other head and would be allowed to be carried forward as per extant law);
(ix) Additional deprecation under clause (iia) of sub-section (1) of section 32;
(x) Deductions under section 32AD, 33AB, 33ABA;
(xi) Various deduction for donation for or expenditure on scientific research contained in sub-clause (ii) or sub-clause
(iia) or sub-clause (iii) of sub-section (1) or sub-section (2AA) of section 35;
(xii) Deduction under section 35AD or section 35CCC;
(xiii) Deduction from family pension under clause (iia) of section 57;
(xiv) Any deduction under chapter VIA (like section 80C, 80CCC, 80CCD, 80D, 80DD, 80DDB, 80E, 80EE, 80EEA,
80EEB, 80G, 80GG, 80GGA, 80GGC, 80IA, 80-IAB, 80-IAC, 80-IB, 80-IBA, etc). However, deduction under
sub-section (2) of section 80CCD (employer contribution on account of employee in notified pension scheme) and
section 80JJAA (for new employment) can be claimed.
As many allowances have been provided through notification of rules, it is proposed to carry out amendment of
the Income-tax Rules, 1962 (the Rules) subsequently, so as to allow only following allowances notified under section 10(14) of
the Act to the Individual or HUF exercising option under the proposed section:
(a) Transport Allowance granted to a divyang employee to meet expenditure for the purpose of commuting between
place of residence and place of duty
(b) Conveyance Allowance granted to meet the expenditure on conveyance in performance of duties of an office;
(c) Any Allowance granted to meet the cost of travel on tour or on transfer;
(d) Daily Allowance to meet the ordinary daily charges incurred by an employee on account of absence from his
normal place of duty.
It is also proposed to amend rule 3 of the Rules subsequently, so as to remove exemption in respect of free food and
beverage through vouchers provided to the employee, being the person exercising option under the proposed section, by the
employer.
9
[Clauses 53, 57 & 58]
C. Modification of concessional tax schemes for domestic companies under section 115BAA and 115BAB
TLAA inserted section 115BAA and section 115BAB in the Act to provide domestic companies an option to be taxed at
concessional tax rates provided they do not avail specified deductions and incentives. Some of the deductions prohibited are
deductions under any provisions of Chapter VI-A under the heading “C. Deduction in respect of certain incomes” other than the
provisions of section 80JJAA.
It is now proposed to amend the provisions of section 115BAA and section 115BAB to not allow deduction under any
provisions of Chapter VI-A other than section 80JJAA or section 80M, in case of domestic companies opting for taxation under
these sections.
These amendments will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year
[Clauses 51 & 52]
D. Withdrawal of exemption on certain perquisites or allowances provided to Union Pubic Services Commission
(UPSC) Chairman and members and Chief Election Commissioner and Election Commissioners
Section 10 of the Act provides for exemption in respect of certain incomes and activities under specific circumstances.
Clause (45) thereof, inserted by the Finance Act, 2011, provides that any allowance or perquisite as may be notified by the
Central Government, paid to the serving/ retired Chairman or Members of UPSC shall not be included in computing their total
income and hence shall be exempt from income-tax.
Further, vide Notification No. 49/2011 dated 6th September, 2011 bearing SO 2045(E), it was notified that in the case
of serving Chairman and members of UPSC the following allowances and perquisites shall be exempt from income-tax for the
purposes of clause (45) of section 10 of the Act, with effect from 1st April, 2008:
(i) the value of rent-free official residence;
(ii) the value of conveyance facilities including transport allowance;
(iii) the sumptuary allowance;
(iv) the value of leave travel concession provided to a serving Chairman or member of the UPSC and members of his
family.
In the case of retired Chairman and members of UPSC, the said Notification states that the following allowances and
perquisites shall be exempt from income-tax for the purposes of clause (45) of section 10 of the Act, with effect from
1st April, 2008:
(i) a sum of maximum of Rs 14,000 per month for defraying the service of an orderly and for meeting expenses
incurred towards secretarial assistance on contract basis;
(ii) the value of a residential telephone free of cost and the number of free calls to the extent of 1500 per month
(overall and above the number of free calls per month allowed by telephone authorities).
Section 8 of the Election Commission (Conditions of Service of Election Commissioners and Transaction of Business)
Act, 1991 which determines the conditions of service of the Chief Election Commissioner and other Election Commissioners,
provides for income-tax exemption to the Chief Election Commissioner and other Election Commissioners on the value of
rent-free residence, conveyance facilities, sumptuary allowance, medical facilities and other such conditions of service as are
applicable to a Judge of the Supreme Court under Chapter IV of the Supreme Court Judges (Conditions of Service) Act, 1958
and the rules made thereunder.
It is proposed to remove these exemptions. Accordingly, it proposed to:
(i) delete cause (45) of section 10 of the Act;
(ii) amend section 8 of the Election Commission (Conditions of Service of Election Commissioners and Transaction of
Business) Act, 1991, so as to delete the exemption from income-tax on value of rent-free residence, conveyance
facilities, sumptuary allowance, medical facilities and other such conditions of service as are applicable to a Judge
of the Supreme Court, paid to Chief Election Commissioner and other Election Commissioners.
[Clause 7]
10
B. TAX INCENTIVES
Exemption in respect of certain income of wholly owned subsidiary of Abu Dhabi Investment Authority and Sovereign
Wealth Fund.
In order to promote investment of sovereign wealth fund, including the wholly owned subsidiary of Abu Dhabi Investment
Authority (ADIA), it is proposed to insert a new clause in the said section so as to provide exemption to any income of a
specified person in the nature of dividend, interest or long-term capital gains arising from an investment made by it in India,
whether in the form of debt or equity, in a company or enterprise carrying on the business of developing, or operating and
maintaining, or developing, operating or maintaining any infrastructure facility as defined in Explanation to clause (i) of
sub-section (4) of section 80-IA of the Act or such other business as may be notified by the Central Government in this behalf.
In order to be eligible for exemption, the investment is required to be made on or before 31st March, 2024 and is required to be
held for at least three years.
For the purpose of this exemption, “specified person” is proposed to be defined to mean,-
(a) a wholly owned subsidiary of the ADIA, which is a resident of the United Arab Emirates (UAE) and which makes
investment, directly or indirectly, out of the fund owned by the Government of the United Arab Emirates; and
(b) a sovereign wealth fund which satisfies the following conditions:
A. It is wholly owned and controlled, directly or indirectly, by Government of a foreign country;
B. It is set up and regulated under the law of the foreign country;
C. Its earnings are credited either to the account of the Government of the foreign country or to any other
account designated by that Government such that no portion of the earnings inures any benefit to any
private person;
D. Its asset vest in the Government of the foreign country upon dissolution;
E. It does not undertake any commercial activity whether within or outside India; and
F. It is notified by the Central Government in the Official Gazette for this purpose.
[Clause 7]
Exemption in respect of certain income of Indian Strategic Petroleum Reserves Limited.
Clause (48A) thereof, inserted by the Finance Act, 2016, provides that any income accruing or arising to a foreign
company on account of storage of crude oil in a facility in India and sale of crude oil therefrom to any person resident in India
shall not be included in the total income, if such storage and sale by the foreign company is pursuant to an agreement or an
arrangement entered into by the Central Government or approved by the Central Government; and having regard to the
national interest, the foreign company and the agreement or arrangement are notified.
Clause (48B) of said section, inserted by the Finance Act, 2017 and amended by the Finance Act, 2018, provides for
exemption in respect of any income accruing or arising to a foreign company on account of sale of leftover stock of crude oil, if
any, from the facility in India after the expiry of the agreement or the arrangement referred to in clause (48A) or on termination
of the said agreement or the arrangement, in accordance with the terms mentioned therein, as the case may be, subject to
such conditions as may be notified by the Central Government in this behalf.
It is now proposed to provide exemption, by inserting a new clause in section 10, to any income accruing or arising to
Indian Strategic Petroleum Reserves Limited (ISPRL), being a wholly owned subsidiary of Oil Industry Development Board
under the Ministry of Petroleum and Natural Gas, as a result of an arrangement for replenishment of crude oil stored in its
storage facility in pursuance to directions of the Central Government in this behalf. This exemption shall be subject to the
condition that the crude oil is replenished in the storage facility within three years from the end of the financial year in which the
crude oil was removed from the storage facility for the first time.
[Clause 7]
Rationalization of provisions of start-ups.
The existing provisions of section 80-IAC of the Act provide for a deduction of an amount equal to one hundred per cent
of the profits and gains derived from an eligible business by an eligible start-up for three consecutive assessment years out of
11
seven years, at the option of the assessee, subject to the condition that the eligible start-up is incorporated on or after
1st April, 2016 but before 1st April, 2021 and the total turnover of its business does not exceed twenty-five crore rupees.
In order to further rationalise the provisions relating to start-ups, it is proposed to amend section 80-IAC of the Act so as to
provide that-
(i) the deduction under the said section 80-IAC shall be available to an eligible start-up for a period of three
consecutive assessment years out of ten years beginning from the year in which it is incorporated;
(ii) the deduction under the said section shall be available to an eligible start-up, if the total turnover of its business
does not exceed one hundred crore rupees in any of the previous years beginning from the year in which it is
incorporated.
[Clause 36]
Extending time limit for approval of affordable housing project for availing deduction under section 80-IBA of the Act.
The existing provisions of section 80-IBA of the Act, inter alia, provide that where the gross total income of an assessee
includes any profits and gains derived from the business of developing and building affordable housing projects, there shall,
subject to certain conditions specified therein, be allowed a deduction of an amount equal to one hundred per cent of the
profits and gains derived from such business. The conditions contained in the section, inter alia, prescribe that the project is
approved by the competent authority during the period from 1st June, 2016 to 31st March, 2020.
In order to incentivise building affordable housing to boost the supply of such houses, the period of approval of the project
by the competent authority is proposed to be extended to 31st March, 2021.
[Clause 38]
Extending time limit for sanctioning of loan for affordable housing for availing deduction under section 80EEA of the Act
The existing provisions of section 80EEA of the Act provide for a deduction in respect of interest on loan taken from any
financial institution for acquisition of an affordable residential house property. The deduction allowed is up to one lakh fifty
thousand rupees and is subject to certain conditions. One of the conditions is that loan has been sanctioned by the financial
institution during the period from 1st April, 2019 to 31st March, 2020.
The said deduction is aimed to incentivise first time buyers to invest in residential house property whose stamp duty does
not exceed forty-five lakh rupees. In order to continue promoting purchase of affordable housing, the period of sanctioning of
loan by the financial institution is proposed to be extended to 31st March, 2021.
[Clause 32]
Modification in conditions for offshore funds’ exemption from “business connection”.
Section 9A of the Act provides for a special regime in respect of offshore funds by providing them exemption from creating
a “business connection” in India on fulfilment of certain conditions. It provides that in the case of an eligible investment fund,
the fund management activity carried out through an eligible fund manager acting on behalf of such fund shall not constitute
business connection in India of the said fund. Further, an eligible investment fund shall not be said to be resident in India
merely because the eligible fund manager undertaking fund management activities on its behalf is located in India. The benefit
under section 9A is available subject to the conditions as provided in sub-sections (3), (4) and (5) thereof. Sub-section (3) of
section 9A provides the conditions for eligibility of the fund.
One of the conditions for eligibility of the fund provided under clause (c) of said sub-section (3) requires that the aggregate
participation or investment in the fund, directly or indirectly, by persons resident in India does not exceed five per cent of the
corpus of the fund. Representations have been received in this regard stating that this condition is difficult to comply with in the
initial years for the reason that eligible fund manager, who is resident in India, is required to invest his money as “skin in the
game” to create reputation to attract investment.
One other condition for eligibility of the fund provided under clause (j) of said sub-section (3) requires that the monthly
average of the corpus of the fund shall not be less than one hundred crore rupees except where the fund has been established
or incorporated in the previous year in which case, the corpus of fund shall not be less than one hundred crore rupees at the
end of a period of six months from the last day of the month of its establishment or incorporation, or at the end of such
previous year, whichever is later. This condition does not apply in a case where the fund has been wound up.
12
Representations have been received in this regard stating that as per this condition, the period for fulfilling the requirement
of monthly average of the corpus of one hundred crore rupees ranges from six months to eighteen months, in so far as the
fund established or incorporated on last day of the financial year would get six months and the fund established or
incorporated on first day of the financial year would get eighteen months. It has been stated that this results in anomaly as
certain funds due to its date of establishment and incorporation get favoured or discriminated against.
Accordingly, it is proposed to amend section 9A of the Act to relax these two conditions so as to provide that,-
(i) for the purpose of calculation of the aggregate participation or investment in the fund, directly or indirectly, by
Indian resident, contribution of the eligible fund manager during first three years up to twenty-five crore rupees shall
not be accounted for; and
(ii) if the fund has been established or incorporated in the previous year, the condition of monthly average of the
corpus of the fund to be at one hundred crore rupees shall be fulfilled within twelve months from the last day of the
month of its establishment or incorporation.
[Clause 6]
Amendment of section 115BAB of the Act to include generation of electricity as manufacturing.
The TLAA, inter-alia, inserted section 115BAB in the Act. The newly inserted section provides that new manufacturing
domestic companies set up on or after 1st October, 2019, which commence manufacturing or production by 31st March, 2023
and do not avail of any specified incentives or deductions, may opt to pay tax at a concessional rate of 15 per cent. Further,
Explanation to clause (b) of sub-section (2) thereof provides that for the purposes of the said section, businesses engaged in
development of computer software, mining, conversion of marble blocks or similar items into slabs, bottling of gas into cylinder,
printing of books or production of cinematograph film or any other business as may be notified by the Central Government will
not be considered as manufacturing or production.
Representations have been received from various stakeholders requesting to provide that the benefit of the concessional
rate under section 115BAB of the Act may also be extended to business of generation of electricity, which otherwise may not
amount to manufacturing or production of an article or thing. Accordingly, it is proposed to explain that, for the purposes of this
section, manufacturing or production of an article or thing shall include generation of electricity.
[Clause 52]
Amendment of section 194LC of the Act to extend the period of concessional rate of withholding tax and also to
provide for the concessional rate to bonds listed in stock exchanges in IFSC.
Section 194LC of the Act, provided for a concessional rate of Tax Deductible at Source (TDS) at five per cent by a
specified company or a business trust, on interest paid to non-residents on the following forms of borrowings (approved by the
Central Government) made in foreign currency from sources outside India:
i. Monies borrowed under a loan agreement at any time on or after 1st July, 2012 and before 1st July, 2020;
ii. Borrowings by way of issue of any long-term infrastructure bond at any time on or after 1st July, 2012 and before
1st July, 2014;
iii. Borrowings by way of issue of long-term bond including long-term infrastructure bonds at any time on or after 1st of
October 2014 and before 1st July, 2020;
The concessional rate of TDS of five per cent is also applicable in respect of monies borrowed by a specified company or
a business trust from a source outside India by way of issue of rupee denominated bond (RDB) before 1st July, 2020, to the
extent such interest does not exceed the amount of interest calculated at the rate approved by the Central Government in this
behalf. Representations have been received for extension of the time limit and also for a further concessional rate of TDS
on interest payment against borrowings through issues of long-term bonds and RDB which are listed only on a recognised
stock exchange in any IFSC.
In order to attract fresh investment, create jobs and stimulate the economy, it is proposed to; -
i. extend the period of said concessional rate of TDS of five per cent to 1st July, 2023 from 1st July, 2020;
ii. provide that the rate of TDS shall be four per cent on the interest payable to a non-resident, in respect of monies
borrowed in foreign currency from a source outside India, by way of issue of any long term bond or RDB on or after
1st April, 2020 but before 1st July, 2023 and which is listed only on a recognised stock exchange located in
any IFSC.
[Clause 82]
13
Amendment of section 194LD of the Act to extend the period of concessional rate of withholding tax and also to
extend this concessional rate to municipal debt securities.
Section 194LD of the Act provides for lower TDS of five per cent in case of interest payments to Foreign Institutional
Investors (FII) and Qualified Foreign Investors (QFIs) on their investment in Government securities and RDB of an Indian
company subject to the condition that the rate of interest does not exceed the rate notified by the Central Government in this
regard. The section further provides that the interest should be payable at any time on or after 1st June, 2013 but before
1st July, 2020.
Representations have been received for extension of the time limit and also for a further concessional rate of TDS on
interest payment on investment in municipal bonds, as Foreign Portfolio Investors (FPIs) have now been permitted to invest in
municipal bonds by the Securities and Exchange Board of India (SEBI) and the Reserve Bank of India (RBI) under the limits
available for FPI investments in State Development Loans (SDL).
In order to attract fresh investment, create jobs and stimulate the economy, it has been proposed to amend section 194LD to,-
(i) extend the period of rate of TDS of five per cent under the said section to 1st July, 2023 from the existing
1st July, 2020;
(ii) provide that the concessional rate of TDS of five per cent under the said section shall also apply on the interest
payable, on or after 1st April, 2020 but before 1st July, 2023, to a FII or QFI in respect of the investment made in
municipal debt security.
[Clause 83]
C. REMOVING DIFFICULTIES FACED BY TAXPAYERS
Excluding interest paid or payable to Permanent Establishment of a non-resident Bank for the purpose of
disallowance of interest under section 94B.
Section 94B of the Act, inter alia, provides that deductible interest or similar expenses exceeding one crore rupees of an
Indian company, or a permanent establishment (PE) of a foreign company, paid to the associated enterprises (AE) shall be
restricted to 30 per cent. of its earnings before interest, taxes, depreciation and amortisation (EBITDA) or interest paid or
payable to AE, whichever is less. Further, a loan is deemed to be from an AE, if an AE provides implicit or explicit guarantee in
respect of that loan. AE for the purposes of this section has the meaning assigned to it in section 92A of the Act. This section
was inserted in the Act through the Finance Act, 2017 in order to implement the measures recommended in final report on
Action Plan 4 of the Base Erosion and Profit Shifting (BEPS) project under the aegis of G-20-Organisation of Economic
Co-operation and Development (OECD) countries to address the issue of base erosion and profit shifting by way of excess
interest deductions.
Representations have been received to carve out interest paid or payable in respect of debt issued by a PE of a
non-resident in India, being a person engaged in the business of banking for the reason that as per the existing provisions a
branch of the foreign company in India is a non-resident in India. Further, the definition of the AE in section 92A, inter alia,
deems two enterprises to be AE, if during the previous year a loan advanced by one enterprise to the other enterprise is at 50
per cent. or more of the book value of the total assets of the other enterprise. Thus, the interest paid or payable in respect of
loan from the branch of a foreign bank may attract provisions of interest limitation provided for under this section.
It is, therefore, proposed to amend section 94B of the Act so as to provide that provisions of interest limitation would not
apply to interest paid in respect of a debt issued by a lender which is a PE of a non-resident, being a person engaged in the
business of banking, in India.
[Clause 46]
Increase in safe harbour limit of 5 per cent. under section 43CA, 50C and 56 of the Act to 10 per cent..
Section 43CA of the Act, inter alia, provides that where the consideration declared to be received or accruing as a result of
the transfer of land or building or both, is less than the value adopted or assessed or assessable by any authority of a State
Government (i.e. “stamp valuation authority”) for the purpose of payment of stamp duty in respect of such transfer, the value so
adopted or assessed or assessable shall for the purpose of computing profits and gains from transfer of such assets, be deemed
to be the full value of consideration. The said section also provide that where the value adopted or assessed or assessable by the
authority for the purpose of payment of stamp duty does not exceed one hundred and five per cent of the consideration received
or accruing as a result of the transfer, the consideration so received or accruing as a result of the transfer shall, for the purposes
of computing profits and gains from transfer of such asset, be deemed to be the full value of the consideration.
Section 50C of the Act provides that where the consideration declared to be received or accruing as a result of the
transfer of land or building or both, is less than the value adopted or assessed or assessable by stamp valuation authority for
14
the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed or assessable shall be
deemed to be the full value of the consideration and capital gains shall be computed on the basis of such consideration under
section 48 of the Act. The said section also provides that where the value adopted or assessed or assessable by the stamp
valuation authority does not exceed one hundred and five per cent of the consideration received or accruing as a result of the
transfer, the consideration so received or accruing as a result of the transfer shall, for the purposes of section 48, be deemed
to be the full value of the consideration.
Clause (x) of sub-section (2) of section 56 of the Act, inter alia, provides that where any person receives, in any previous
year, from any person or persons on or after 1st April, 2017, any immovable property, for a consideration which is less than the
stamp duty value of the property by an amount exceeding fifty thousand rupees, the stamp duty value of such property as
exceeds such consideration shall be charged to tax under the head “income from other sources”. It also provide that where the
assessee receives any immovable property for a consideration and the stamp duty value of such property exceeds five per
cent of the consideration or fifty thousand rupees, whichever is higher, the stamp duty value of such property as exceeds such
consideration shall be charged to tax under the head “Income from other sources”.
Thus, the present provisions of section 43CA, 50C and 56 of the Act provide for safe harbour of five per cent.
Representations have been received in this regard requesting that the said safe harbour of five per cent may be
increased.
It is, therefore, proposed to increase the limit to ten per cent..
[Clauses 22, 27 & 29]
Providing an option to the assessee for not availing deduction under section 35AD.
Section 35AD of the Act, relating to deduction in respect of expenditure on specified business, provides for 100 per cent.
deduction on capital expenditure (other than expenditure on land, goodwill and financial assets) incurred by the assessee on
certain specified businesses. Under sub-section (1) of section 35AD, the said deduction of 100 per cent. of the capital
expenditure is allowable during the previous year in which such expenditure has been incurred. Further, sub-section (4)
provides that no deduction is allowable under any other section in respect to the expenditure referred to in sub-section (1). At
present, an assessee does not have any option of not availing the incentive under said section.
Due to this, a legal interpretation can be made that a domestic company opting for concessional tax rate under section
115BAA or section 115BAB of the Act, which does not claim deduction under section 35AD, would also be denied normal
depreciation under section 32 due to operation of sub-section (4) of section 35AD. This has not been the intention of the
statute.
Therefore, it is proposed to amend sub-section (1) of section 35AD to make the deduction thereunder optional. It is further
proposed to amend sub-section (4) of section 35AD to provide that no deduction will be allowed in respect of expenditure
incurred under sub-section (1) in any other section in any previous year or under this section in any other previous year, if the
deduction has been claimed by the assessee and allowed to him under this section.
[Clause 18]
Exempting non-resident from filing of Income-tax return in certain conditions.
Section 115A of the Act provides for the determination of tax for a non-resident whose total income consists of:
(a) certain dividend or interest income;
(b) royalty or fees for technical services (FTS) received from the Government or Indian concern in pursuance of an
agreement made after 31st March 1976, and which is not effectively connected with a PE, if any, of the
non-resident in India.
Sub-section (5) of said section provides that a non-resident is not required to furnish its return of income under
sub-section (1) of section 139 of the Act, if its total income, consists only of certain dividend or interest income and the TDS on
such income has been deducted according to the provisions of Chapter XVII-B of the Act.
While, the current provisions of section 115A of the Act provide relief to non-residents from filing of return of income where
the non-resident is not liable to pay tax other than the TDS which has been deducted on the dividend or interest income, the
same relief has not been extended to non-residents whose total income consists only of the income by way of royalty or FTS
of the nature as mentioned in point (b) above. Representations have been received to extend this benefit to royalty and FTS
income as well.
15
Therefore, it is proposed to amend section 115A of the Act in order to provide that a non-resident, shall not be required to
file return of income under sub-section (1) of section 139 of the Act if, -
(i) his or its total income consists of only dividend or interest income as referred to in clause (a) of sub-section (1) of
said section, or royalty or FTS income of the nature specified in clause (b) of sub-section (1) of section 115A; and
(ii) the TDS on such income has been deducted under the provisions of Chapter XVII-B of the Act at the rates which
are not lower than the prescribed rates under sub-section (1) of section 115A.
[Clause 47]
Deferring TDS or tax payment in respect of income pertaining to Employee Stock Option Plan (ESOP) of start- ups.
ESOPs have been a significant component of the compensation for the employees of
start-ups, as it allows the founders and start-ups to employ highly talented employees at a relatively low salary amount with
balance being made up via ESOPs.
Currently ESOPs are taxed as perquisites under section 17(2) of the Act read with Rule 3(8)(iii) of the Rules. The taxation
of ESOPs is split into two components:
i. Tax on perquisite as income from salary at the time of exercise.
ii. Tax on income from capital gain at the time of sale.
The tax on perquisite is required to be paid at the time of exercising of option which may lead to cash flow problem as this
benefit of ESOP is in kind.
In order to ease the burden of payment of taxes by the employees of the eligible start-ups or TDS by the start-up
employer, it is proposed to amend section 192 of the Act, and insert sub-section (1C) therein to clarify that for the purpose of
deducting or paying tax under sub-sections (1) or (1A) thereof, as the case may be, a person, being an eligible start-up
referred to in section 80-IAC, responsible for paying any income to the assessee being perquisite of the nature specified in
clause (vi) of sub-section (2) of section 17 of the Act, in any previous year relevant to the assessment year 2021-22 or
subsequent assessment year, deduct or pay, as the case may be, tax on such income within fourteen days —
(i) after the expiry of forty eight months from the end of the relevant assessment year; or
(ii) from the date of the sale of such specified security or sweat equity share by the assessee; or
(iii) from the date of which the assessee ceases to be the employee of the person;
whichever is the earliest on the basis of rates in force of the financial year in which the said specified security or sweat
equity share is allotted or transferred .
Similar amendments have been carried out in section 191 (for assessee to pay the tax direct in case of no TDS) and in
section 156 (for notice of demand) and in section 140A (for calculating self-assessment).
[Clauses 68, 71, 72 & 73]
Allowing carry forward of losses or depreciation in certain amalgamations.
Section 72AA of the Act provides for carry forward of accumulated losses and unabsorbed depreciation allowance in the case
of amalgamation of banking company with any other banking institution under a scheme sanctioned and brought into force by the
Central Government under sub-section (7) of section 45 of the Banking Regulation Act, 1949. This section operates
notwithstanding anything contained in sub-clause (i) to (iii) of clause (1B) of section 2 or section 72A of the Act.
In order to address the issue faced by the amalgamated public sector banks and public sector General Insurance
Companies, it is proposed to extend the benefit of this section to amalgamation of,-
(i) one or more corresponding new bank or banks with any other corresponding new bank under a scheme brought
into force by the Central Government under section 9 of the Banking Companies (Acquisition and Transfer of
Undertakings) Act, 1970 or under section 9 of the Banking Companies (Acquisition and Transfer of Undertakings)
Act, 1980, or both, as the case may be, or
(ii) One or more Government company or companies with any other Government company under a scheme
sanctioned and brought into force by the Central Government under section 16 of the General Insurance Business
(Nationalisation) Act, 1972.
“Corresponding new bank” is proposed to be given the meaning as assigned to it in clause (d) of section 2 of the Banking
Companies (Acquisition and Transfer of Undertakings) Act, 1970 or clause (b) of section 2 of the Banking Companies
(Acquisition and Transfer of Undertakings) Act, 1980.
16
“Government company” is proposed to be given the meaning assigned to it in section 2(45) of the Companies
Act, 2013. In addition, it is to be engaged in the general insurance business and has come into existence by operation of
section 4 or section 5 or section 16 of the General Insurance Business (Nationalisation) Act, 1972.
“General insurance business” is proposed to be given the meaning assigned to it in clause (g) of section 3 of the General
Insurance Business (Nationalisation) Act, 1972.
[Clause 31]
Modification of the definition of “business trust”
Section 115UA of the Act provides for a taxation regime applicable to business trusts. Under the said regime, the total
income of the trust, excluding capital gains income is charged at the maximum marginal rate. Further, the income by way of
interest and rent, received by the business trust from a Special Purpose Vehicle (SPV) is accorded pass through treatment i.e.
there is no taxation of such interest or rental income in the hands of the trust and no withholding tax at the level of SPV. The
business trusts are also required to furnish return of income and adhere to other reporting requirements.
The definition of “business trust” has been provided in clause (13A) of section 2 of the Act, to mean a trust registered as
an Infrastructure Investment Trust (InvIT) or a Real Estate Investment Trust (REIT) under the relevant regulations made under
the Securities and Exchange Board of India (SEBI) Act, 1992 and the units of which are required to be listed on a recognised
stock exchange in accordance with the relevant regulations.
Representations have been received stating that private unlisted InvITs should be given the same status as public listed
InvITs with regards to tax treatments provided under the Act. Securities and Exchange Board of India (Infrastructure
Investment Trusts) (Amendment) (Regulations), 2019 vide notification No.SEBI/LAD-NRO/GN/2019/10 has, inter-alia, done
away with the mandatory listing requirement for InvITs. In light of this, the definition of business trusts under the Act is
required to be aligned with the amended SEBI Regulations.
Therefore, it is proposed to amend clause (13A) of section 2 of the Act to modify the definition of “business trust” so as to
do away with the requirement of the units of business trust to be listed on a recognised stock exchange.
[Clause 62]
D. MEASURES TO PROVIDE TAX CERTAINTY
Amendment for providing attribution of profit to Permanent Establishment in Safe Harbour Rules under section 92CB
and in Advance Pricing Agreement under section 92CC
Section 92CB of the Act empowers the Central Board of Direct Taxes (Board) for making safe harbour rules (SHR) to
which the determination of the arm's length price (ALP) under section 92C or section 92CA of the Act shall be subject to. As
per Explanation to said section the term “safe harbour” means circumstances in which the Income-tax Authority shall accept
the transfer price declared by the assessee. This section was inserted in the Act to reduce the number of transfer pricing
audits and prolonged disputes especially in case of relatively smaller assessees. Besides reduction of disputes, the SHR
provides certainty as well.
Further, section 92CC of the Act empowers the Board to enter into an advance pricing agreement (APA) with any person,
determining the ALP or specifying the manner in which the ALP is to be determined, in relation to an international transaction
to be entered into by that person. APA provides tax certainty in determination of ALP for five future years as well as for four
earlier years (Rollback).
SHR provides tax certainty for relatively smaller cases for future years on general terms, while APA provides tax certainty
on case to case basis not only for future years but also Rollback years. Both SHR and the APA have been successful in
reducing litigation in determination of the ALP.
It has been represented that the attribution of profits to the PE of a non-resident under clause (i) of sub-section (1) of
section 9 of the Act in accordance with rule 10 of the Rules also results in avoidable disputes in a number of cases. In order to
provide certainty, the attribution of income in case of a non-resident person to the PE is also required to be clearly covered
under the provisions of the SHR and the APA.
In view of the above, it is proposed to amend section 92CB and section 92CC of the Act to cover determination of
attribution to PE within the scope of SHR and APA.
With respect to section 92CB, the amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to
the assessment year 2020-21 and subsequent assessment years.
17
With respect to section 92CC, the amendment will take effect from 1st April, 2020 and therefore will apply to an APA
entered into on or after 1st April, 2020.
[Clauses 43 & 44]
Allowing deduction for amount disallowed under section 43B, to insurance companies on payment basis.
Section 44 of the Act provides that computation of profits and gains of any business of insurance, including any such
business carried on by a mutual insurance company or a co-operative society shall be computed in accordance with the rules
contained in the First Schedule to the Act.
Section 43B of the Act provides for allowance of certain deductions, irrespective of the previous year in which the liability
to pay such sum was incurred by the assessee according to the method of accounting regularly employed by the assessee,
only in the previous year in which such sum is actually paid.
Rule 5 of the said Schedule provides for computation of profits and gains of other insurance business. It states that profits
and gains of any business of insurance other than life insurance shall be taken to be the profit before tax and appropriations as
disclosed in the profit and loss account prepared in accordance with the provisions of the Insurance Act, 1938 or the rule made
thereunder or the provisions of the Insurance Regulatory and Development Authority Act, 1999 or the regulations made
thereunder, subject to the condition that any expenditure debited to the profit and loss account which is not admissible under
the provisions of sections 30 to 43B shall be added back; any gain or loss on realisation of investment shall be added or
deducted, as the case may be, if the same is not credited or debited to the profit and loss account; any provision for diminution
in the value of investment debited to the profit and loss account shall be added back. Thus, there is no specific provision, in
this rule, in the case of other insurance companies, to allow deduction for any payment of certain expenses specified in
section 43B if they are paid in subsequent previous year. There is a possibility that such sum may not be allowed as deduction
in the previous year in which the payment is made. This has not been the intention of the legislature.
Therefore, it is proposed to insert a proviso after clause (c) of the said rule 5 to provide that any sum payable by the
assessee which is added back under section 43B in accordance with clause (a) of the said rule shall be allowed as deduction
in computing the income under the rule in the previous year in which such sum is actually paid.
[Clause 104]
Reducing the rate of TDS on fees for technical services (other than professional services).
Section 194J of the Act provides that any person, not being an individual or a HUF, who is responsible for paying to a
resident any sum by way of fees for professional services, or fees for technical services, or any remuneration or fees or
commission by whatever name called (other than those on which tax is deductible under section 192 of the Act, to a director),
or royalty or any sum referred to in clause (va) of section 28, shall, at the time of payment or credit of such sum to the account
of the payee, deduct an amount equal to ten per cent as income-tax.
Section 194C of the Act provides that any person responsible for paying any sum to a resident for carrying out any work
(including supply of labour for carrying out any work) in pursuance of a contract shall at the time of payment or credit of such sum
deduct an amount equal to one per cent in case payment is made to an individual or a HUF and two per cent in other cases.
It is noticed that there are large number of litigations on the issue of short deduction of tax treating assessee in default
where the assessee deducts tax under section 194C, while the tax officers claim that tax should have been deducted under
section 194J of the Act.
Therefore to reduce litigation, it is proposed to reduce rate for TDS in section 194J in case of fees for technical services
(other than professional services) to two per cent from existing ten per cent. The TDS rate in other cases under section 194J
would remain same at ten per cent.
[Clause 79]
E. WIDENING AND DEEPENENING OF TAX BASE
Enlarging the scope for tax deduction on interest income under section 194A of the Act.
Section 194A of the Act governs interest other than interest on securities. Sub-section (1) thereof provides that any person
not being individual or HUF who is responsible for paying to a resident any income by way of interest other than income by
way of interest on securities, shall deduct income-tax at the rates in force.
Sub-section (3) of said section provides for circumstances in which the provisions of sub-section (1) shall not apply.
Clause (i) thereof provides the circumstance where the amount of such income or, as the case may be, the aggregate of the
amounts of such income credited or paid or likely to be credited or paid during the financial year by the person to the account
of, or to, the payee, does not exceed a certain threshold. Clause (v) provides circumstance to be the income credited or paid
18
by a co-operative society (other than a co-operative bank) to a member or to income credited or paid by a co-operative society
to any other co-operative society. Clause (viia) provides circumstance to be the income credited or paid in respect of deposits
with a primary agricultural credit society or a primary credit society or a co-operative land mortgage bank or a
co-operative land development bank and deposits (other than time deposits) with a co-operative bank other than a
co-operative society or bank engaged in carrying on the business of banking.
In order to extend the scope of this section to interest paid by large co-operative society, it is proposed to amend
sub-section (3) and insert proviso to provide that a co-operative society referred to in clause (v) or clause (viia) of said
sub-section (3) shall be liable to deduct income-tax in accordance with the provisions of sub-section (1), if-
(a) the total sales, gross receipts or turnover of the co-operative society exceeds fifty crore rupees during the financial
year immediately preceding the financial year in which the interest referred to in sub-section (1) is credited or paid;
and
(b) the amount of interest, or the aggregate of the amount of such interest, credited or paid, or is likely to be credited or
paid, during the financial year is more than fifty thousand rupees in case of payee being a senior citizen and forty
thousand rupees, in any other case.
[Clause 75]
Widening the scope of TDS on E-commerce transactions through insertion of a new section.
In order to widen and deepen the tax net by bringing participants of e-commerce within tax net, it is proposed to insert a
new section 194-O in the Act so as to provide for a new levy of TDS at the rate of one per cent. with the following key points:
• The TDS is to be paid by e-commerce operator for sale of goods or provision of service facilitated by it through its
digital or electronic facility or platform;
• E-commerce operator is required to deduct tax at the time of credit of amount of sale or service or both to the
account of e-commerce participant or at the time of payment thereof to such participant by any mode, whichever is
earlier.
• The tax at one per cent is required to be deducted on the gross amount of such sales or service or both.
• Any payment made by a purchaser of goods or recipient of services directly to an e-commerce participant shall be
deemed to be amount credited or paid by the e-commerce operator to the e-commerce participant and shall be
included in the gross amount of such sales or services for the purpose of deduction of income-tax.
• The sum credited or paid to an e-commerce participant (being an individual or HUF) by the e-commerce operator
shall not be subjected to provision of this section, if the gross amount of sales or services or both of such individual
or HUF, through e-commerce operator, during the previous year does not exceed five lakh rupees and such
e-commerce participant has furnished his Permanent Account Number (PAN) or Aadhaar number to the
e-commerce operator.
• A transaction in respect of which tax has been deducted by the e-commerce operator under this section or which is
not liable to deduction under the exemption discussed in the previous bullet, there shall not be further liability on
that transaction for TDS under any other provision of Chapter XVII-B of the Act. This is to provide clarity so that
same transaction is not subjected to TDS more than once. However, it has been clarified that this exemption will
not apply to any amount received or receivable by an e-commerce operator for hosting advertisements or providing
any other services which are not in connection with the sale of goods or services referred to in sub-section (1) of
the proposed section.
• “e-commerce operator” is defined to mean any person who owns, operates or manages digital or electronic facility
or platform for electronic commerce and is a person responsible for paying to e-commerce participant.
• “e-commerce participant” is defined to mean a person resident in India selling goods or providing services or both,
including digital products, through digital or electronic facility or platform for electronic commerce.
• “electronic commerce” is defined to mean the supply of goods or services or both, including digital products, over
digital or electronic network.
• “services” is defined to include fees for technical services and fees for professional services, as defined in section
194J.
• Consequential amendments are being proposed in section 197 (for lower TDS), in section 204 (to define person
responsible for paying any sum) and in section 206AA (to provide for tax deduction at 5 per cent. in
non-PAN/ Aadhaar cases).
[Clause 84]
19
Widening the scope of section 206C to include TCS on foreign remittance through Liberalised Remittance Scheme
(LRS) and on selling of overseas tour package as well as TCS on sale of goods over a limit.
Section 206C of the Act provides for the collection of tax at source (TCS) on business of trading in alcohol, liquor, forest
produce, scrap etc. Sub-section (1) of the said section, inter-alia, provides that every person, being a seller shall, at the time of
debiting of the amount payable by the buyer to the account of the buyer or at the time of receipt of such amount from the said
buyer in cash or by the issue of a cheque or draft or by any other mode, whichever is earlier, collect from the buyer of certain
goods a sum equal to specified percentage, of such amount as income-tax.
In order to widen and deepen the tax net, it is proposed to amend section 206C to levy TCS on overseas remittance and
for sale of overseas tour package, as under:
• An authorised dealer receiving an amount or an aggregate of amounts of seven lakh rupees or more in a financial
year for remittance out of India under the LRS of RBI, shall be liable to collect TCS, if he receives sum in excess of
said amount from a buyer being a person remitting such amount out of India, at the rate of five per cent. In non-
PAN/Aadhaar cases the rate shall be ten per cent.
• A seller of an overseas tour program package who receives any amount from any buyer, being a person who
purchases such package, shall be liable to collect TCS at the rate of five per cent. In non-PAN/ Aadhaar cases the
rate shall be ten per cent.
• The above TCS provision shall not apply if the buyer is,-
a. liable to deduct tax at source under any other provision of the Act and he has deducted such amount.
b. the Central Government, a State Government , an embassy, a High Commission, legation, commission,
consulate, the trade representation of a foreign State, a local authority as defined in Explanation to clause
(20) of section 10 or any other person notified by the Central Government in the Official Gazette for this
purpose subject to such conditions as specified in that notification.
• “authorised dealer” is proposed to be defined to mean a person authorised by the Reserve Bank of India under
sub-section (1) of section 10 of Foreign Exchange Management Act, 1999 to deal in foreign exchange or foreign
security.
• “Overseas tour program package” is proposed to be defined to mean any tour package which offers visit to a
country or countries or territory or territories outside India and includes expenses for travel or hotel stay or boarding
or lodging or any other expense of similar nature or in relation thereto.
Further, in order to widen and deepen the tax net, it is proposed to amend section 206C to levy TCS on sale of goods
above specified limit, as under:
• A seller of goods is liable to collect TCS at the rate of 0.1 per cent. on consideration received from a buyer in a
previous year in excess of fifty lakh rupees. In non-PAN/ Aadhaar cases the rate shall be one per cent.
• Only those seller whose total sales, gross receipts or turnover from the business carried on by it exceed ten crore
rupees during the financial year immediately preceding the financial year, shall be liable to collect such TCS.
• Central Government may notify person, subject to conditions contained in such notification, who shall not be liable
to collect such TCS.
• No TCS is to be collected from the Central Government, a State Government and an embassy, a High
Commission, legation, commission, consulate, the trade representation of a foreign State, a local authority as
defined in Explanation to clause (20) of section 10 or any other person as the Central Government may, by
notification in the Official Gazette, specify for this purpose, subject to conditions as prescribed in such notification.
• No such TCS is to be collected, if the seller is liable to collect TCS under other provision of section 206C or the
buyer is liable to deduct TDS under any provision of the Act and has deducted such amount.
[Clause 93]
F. REVENUE MOBILISATION MEASURES
Rationalization of tax treatment of employer’s contribution to recognized provident funds, superannuation funds and
national pension scheme.
Under the existing provisions of the Act, the contribution by the employer to the account of an employee in a recognized
provident fund exceeding twelve per cent. of salary is taxable. Further, the amount of any contribution to an approved
superannuation fund by the employer exceeding one lakh fifty thousand rupees is treated as perquisite in the hands of the
employee. Similarly, the assessee is allowed a deduction under National Pension Scheme (NPS) for the fourteen per cent. of
the salary contributed by the Central Government and ten per cent. of the salary contributed by any other employer. However,
there is no combined upper limit for the purpose of deduction on the amount of contribution made by the employer. This is
20
giving undue benefit to employees earning high salary income. While an employee with low salary income is not able to let
employer contribute a large part of his salary to all these three funds, employees with high salary income are able to design
their salary package in a manner where a large part of their salary is paid by the employer in these three funds. Thus, this
portion of salary does not suffer taxation at any point of time, since Exempt-Exempt-Exempt (EEE) regime is followed for these
three funds. Thus, not having a combined upper cap is iniquitous and hence, not desirable.
Therefore, it is proposed to provide a combined upper limit of seven lakh and fifty thousand rupee in respect of employer's
contribution in a year to NPS, superannuation fund and recognised provident fund and any excess contribution is proposed to
be taxable. Consequently, it is also proposed that any annual accretion by way of interest, dividend or any other amount of
similar nature during the previous year to the balance at the credit of the fund or scheme may be treated as perquisite to the
extent it relates to the employer’s contribution which is included in total income.
[Clause 13]
Widening the scope of Commodity Transaction Tax (CTT).
The Finance Act, 2013 had introduced Commodities Transaction Tax (CTT) on the sale of commodity derivatives based
on non-agricultural commodities traded in recognised associations. The intention behind introducing CTT was to bring parity
between the derivative trading in the securities market and the commodity market. The CTT was levied at the rate of 0.01 per
cent, which was also the rate of Securities Transaction Tax (STT) levied on sale of ‘futures’ (a contract, which derives its value
from an underlying asset and is settled by physical delivery) in securities. Subsequently, the scope of CTT was expanded vide
the Finance Act, 2018 by also including the sale of options on commodity derivatives as taxable commodity transactions.
Trading in derivatives including commodity derivatives is regulated by the Securities Contract (Regulation) Act, 1956
(SCRA). Prior to 2015, derivative trading in commodities was regulated by the Forward Markets Commission (FMC) under the
Forward Contracts (Regulation) Act, 1952 (FCRA). In 2015, the FCRA was repealed and the FMC was merged with the SEBI.
As a result, the recognised associations defined in the FCRA were replaced by the recognised stock exchange defined in the
SCRA. Subsequently, the scope of “commodity derivatives” was expanded vide notification dated 27th September, 2016,
which notified a number of goods for the purpose of its definition in clause (bc) of section 2 of the SCRA. These goods
included cereals and pulses, oil seeds/ oil cakes and oils, spices, metals, precious metals, gem and stones, fibres, energy,
sweeteners, plantation, dry fruits and others.
Presently, as per SCRA regulations, derivative trading in commodities is limited only to commodity ‘futures’ and ‘option on
commodity futures’. The underlying asset in the ‘option on commodity futures’ is a ‘commodity future’. This means that upon
expiry, if the ‘option’ is exercised, the option-holder gets a right to buy or sell a ‘commodity future’ and not the right to buy or
sell the goods directly. However, vide notification dated 18th October, 2019, ‘option in goods’ has also been included in the
definition of ‘derivatives’ in clause (ac) of section 2 of the SCRA. This has paved the way for new derivative product ‘options in
goods’ with goods notified on 27.09.2016 directly as the underlying asset. Moreover, ‘commodity futures’ based on prices or
indices of prices of ‘commodity futures’ is also likely to be introduced as a new product in the commodity derivative market.
Necessary changes are, therefore, proposed in Chapter VII of the Finance Act, 2013, to align the provisions of CTT with
the changes in commodity derivative market. Moreover, in order to encourage the commodity transactions , settled by physical
or actual delivery of goods, it is proposed to charge CTT on the new commodity derivative products at following rates: –
• Sale of a commodity derivative based on prices or indices of prices of commodity derivatives at the rate of 0.01 per
cent payable by the seller, which is the same rate at which CTT is currently charged on a transaction of sale of a
commodity derivative;
• Sale of an option in goods, where option is exercised resulting in actual delivery of goods at the rate of 0.0001 per
cent payable by purchaser;
• Sale of an option in goods, where option is exercised resulting in a settlement otherwise than by the actual delivery
of goods at the rate of 0.125 per cent payable by purchaser, which is also the rate at which securities transaction
tax is levied on a transaction of sale of an option in securities, where the option is exercised.
Further, the following changes are also proposed in the Finance Act, 2013–
(a) The definition of taxable commodities transaction in clause (7) of section 116 is proposed to be amended to –
(i) include the transactions of “sale of option in goods” and “sale of commodity derivatives based on prices or
indices of prices of commodity derivatives” and
(ii) substitute “recognised stock exchange” in place of “recognised association”.
(b) The reference to FCRA in clause (8) of section 116 is proposed to be changed to SCRA.
(c) The table in section 117 to be amended to incorporate the taxable commodities transactions referred to in (a)
above, specify the rate of CTT and specify the person by whom CTT is payable.
21
(d) The value of taxable commodities transactions defined in section 118 is proposed to be amended to incorporate
the taxable commodities transaction referred to in para (a) (i) above.
[Clause 147]
G. IMPROVING EFFECTIVENESS OF TAX ADMINISTRATION
Modification of e-assessment scheme.
Section 143 of the Act provides the manner for processing and assessment of return of income (ITR) where a return has
been made under section 139, or in response to a notice under sub-section (1) of section 142 of the Act.
2. Sub-section (3A) of section 143 provides that the Central Government may make a scheme, by notification in the
Official Gazette, for the purposes of making assessment of total income or loss of the assessee under sub-section (3) of
section 143 so as to impart greater efficiency, transparency and accountability by certain means specified therein. Accordingly,
E-assessment Scheme, 2019 was notified under sub-section (3A) of Section 143 of the Act.
3. It is proposed to amend sub-section (3A) of section 143 of the Act to,-
(i) expand the scope so as to include the reference of section 144 of the Act relating to best judgement assessment in
the said sub-section;
(ii) provide that Central Government may issue any direction under sub-section (3B) of the said section upto
31st March, 2022.
[Clause 69]
Amendment in Dispute Resolution Panel (DRP).
Section 144C of the Act provides that in case of certain eligible assessees, viz., foreign companies and any person in
whose case transfer pricing adjustments have been made under sub-section (3) of section 92CA of the Act, the Assessing
Officer (AO) is required to forward a draft assessment order to the eligible assessee, if he proposes to make any variation in
the income or loss returned which is prejudicial to the interest of such assessee. Such eligible assessee with respect to such
variation may file his objection to the DRP, a collegium of three Principal Commissioners or Commissioners of Income-tax.
DRP has nine months to pass directions which are binding on the AO.
It is proposed that the provisions of section 144C of the Act may be suitably amended to:-
(A) include cases, where the AO proposes to make any variation which is prejudicial to the interest of the assessee,
within the ambit of section 144C;
(B) expand the scope of the said section by defining eligible assessee as a non-resident not being a company, or a
foreign company.
This amendment will take effect from 1st April, 2020. Thus, if the AO proposes to make any variation after this date, in
case of eligible assessee, which is prejudicial to the interest of the assessee, the above provision shall be applicable.
[Clause 70]
Provision for e-appeal.
In order to impart greater efficiency, transparency and accountability to the assessment process under the Act a new
e-assessment scheme has already been introduced. With the advent of the e-assessment scheme, most of the functions/
processes under the Act, including of filing of return, processing of returns, issuance of refunds or demand notices and
assessment, which used to require person-to-person contact between the taxpayer and the Income-tax Department, are now
in the electronic mode. This is a result of efforts by the Department to harness the power of technology in reforming the
system. All these processes are now not only faceless but also very taxpayer-friendly. Now a taxpayer can manage to comply
with most of his obligations under the Act without any requirement for physical attendance in the offices of the Department.
The filing of appeals before Commissioner (Appeals) has already been enabled in an electronic mode. However, the first
appeal process under the Commissioner (Appeals), which is one of the major functions/ processes that is not yet in full
electronic mode. A taxpayer can file appeal through his registered account on the e-filing portal. However, the process that
follows after filing of appeal is neither electronic nor faceless. In order to ensure that the reforms initiated by the Department to
eliminate human interface from the system reach the next level, it is imperative that an e-appeal scheme be launched on the
lines of e-assessment scheme.
Accordingly, it is proposed to insert sub-section (6A) in section 250 of the Act to provide for the following: —
• Empowering Central Government to notify an e-appeal scheme for disposal of appeal so as to impart greater
efficiency, transparency and accountability.
22
• Eliminating the interface between the Commissioner (Appeals) and the appellant in the course of appellate
proceedings to the extent technologically feasible.
• Optimizing utilization of the resources through economies of scale and functional specialisation.
• Introducing an appellate system with dynamic jurisdiction in which appeal shall be disposed of by one or more
Commissioner (Appeals).
It is also proposed to empower the Central Government, for the purpose of giving effect to the scheme made under the
proposed sub-section, by notification in the Official Gazette, to direct that any of the provisions of this Act relating to jurisdiction
and procedure of disposal of appeal shall not apply or shall apply with such exceptions, modifications and adaptations as may
be specified in the notification. Such directions are to be issued on or before 31st March 2022. It is proposed that every
notification issued shall be required to be laid before each House of Parliament.
[Clause 95]
Providing check on survey operations under section 133A of the Act.
Under the existing provisions of section 133A of the Act, an income-tax authority as defined therein is empowered to
conduct survey at the business premises of the assessee under his jurisdiction. To prevent the possible misuse of such
powers, vide Finance Act 2003, a proviso to sub-section (6) in the said section was inserted to provide that no income-tax
authority below the rank of Joint Director or Joint Commissioner, shall conduct any survey under the said section without prior
approval of the Joint Director or the Joint Commissioner, as the case may be.
It is proposed to substitute the proviso to sub-section (6) of section 133A to provide that,-
(A) in a case where the information has been received from the prescribed authority, no income-tax authority below the
rank of Joint Director or Joint Commissioner, shall conduct any survey under the said section without prior approval
of the Joint Director or the Joint Commissioner, as the case may be; and
(B) in any other case, no income-tax authority below the rank of Commissioner or Director, shall conduct any survey
under the said section without prior approval of the Commissioner or the Director, as the case may be.
[Clause 65]
Clarity on stay by the Income Tax Appellate Tribunal (ITAT).
The existing provisions of the first proviso to sub-section (2A) of section 254 of the Act, inter-alia, provides that the
ITAT may, after considering the merits of the application made by the assessee pass an order of stay for a maximum period
of 180 days in any proceedings against the order of the Commissioner of Income-tax (Appeal). Second proviso to the said
sub-section prescribes that where the appeal is not so disposed of, the ITAT on being satisfied that the delay is not
attributable to the assessee, extend the stay for a further period subject to the restriction that the aggregate of the periods
originally allowed and the period so extended shall not, in any case, exceed 365 days and the Appellate Tribunal shall
dispose of the appeal within the period or periods of stay so extended or allowed. The third proviso of the said sub-section
also provides that if such appeal is not so disposed of within the period allowed under the first proviso or the period or
periods extended or allowed under the second proviso, which shall not, in any case, exceed 365 days, the order of stay
shall stand vacated after the expiry of such period or periods, even if the delay in disposing of the appeal is not attributable
to the assessee.
It is proposed to provide that ITAT may grant stay under the first proviso subject to the condition that the assessee
deposits not less than twenty per cent of the amount of tax, interest, fee, penalty, or any other sum payable under the
provisions of this Act, or furnish security of equal amount in respect thereof.
It is also proposed to substitute second proviso to provide that no extension of stay shall be granted by ITAT, where such
appeal is not so disposed of which the said period of stay as specified in the order of stay. However, on an application made
by the assessee, a further stay can be granted, if the delay in not disposing of the appeal is not attributable to the assessee
and the assessee has deposited not less than twenty per cent of the amount of tax, interest, fee, penalty, or any other sum
payable under the provisions of this Act, or furnish security of equal amount in respect thereof. The total stay granted by ITAT
cannot exceed 365 days.
[Clause 97]
Provision for e-penalty.
In order to impart greater efficiency, transparency and accountability to the assessment process under the Act a new
e-assessment scheme has already been introduced.
23
Section 274 of the Act provides for the procedure for imposing penalty under Chapter XXI of the Act. In response to a
show cause notice issued by the Assessing Officer (AO), assessee or his authorised representative is still required to visit the
office of the Assessing Officer. With the advent of the E-Assessment Scheme-2019 and in order to ensure that the reforms
initiated by the Department to eliminate human interface from the system reaches the next level, it is imperative that an
e-penalty scheme be launched on the lines of E-assessment Scheme-2019.
Therefore, it is proposed to insert a new sub-section (2A) in the said section so as to provide that the Central Government
may notify an e-scheme for the purposes of imposing penalty so as to impart greater efficiency, transparency and
accountability by,—
(a) eliminating the interface between the Assessing Officer and the assessee in the course of proceedings to the
extent technologically feasible;
(b) optimising utilisation of the resources through economies of scale and functional specialisation;
(c) introducing a mechanism for imposing of penalty with dynamic jurisdiction in which penalty shall be imposed by one
or more income-tax authorities.
It is also proposed to empower the Central Government, for the purpose of giving effect to the scheme made under the
proposed sub-section, for issuing notification in the Official Gazette, to direct that any of the provisions of this Act relating to
jurisdiction and procedure of imposing penalty shall not apply or shall apply with such exceptions, modifications and
adaptations as may be specified in the notification. Such directions are to be issued on or before 31st March, 2022. It is
proposed that every notification issued shall be required to be laid before each House of Parliament.
[Clause 100]
Insertion of Taxpayer’s Charter in the Act.
It is proposed to insert a new section 119A in the Act to empower the Board to adopt and declare a Taxpayer’s Charter
and issue such orders, instructions, directions or guidelines to other income-tax authorities as it may deem fit for the
administration of Charter.
[Clause 64]
H. PREVENTING TAX ABUSE
Modification of residency provisions.
Sub-section (1) of section 6 of the Act provide for situations in which an individual shall be resident in India in a previous
year. Clause (c) thereof provides that the individual shall be Indian resident in a year, if he,-
(i) has been in India for an overall period of 365 days or more within four years preceding that year, and
(ii) is in India for an overall period of 60 days or more in that year.
Clause (b) of Explanation 1 of said sub-section provides that an Indian citizen or a person of Indian origin shall be Indian
resident if he is in India for 182 days instead of 60 days in that year. This provision provides relaxation to an Indian citizen or a
person of Indian origin allowing them to visit India for longer duration without becoming resident of India.
Instances have come to notice where period of 182 days specified in respect of an Indian citizen or person of Indian origin
visiting India during the year, is being misused. Individuals, who are actually carrying out substantial economic activities from
India, manage their period of stay in India, so as to remain a non-resident in perpetuity and not be required to declare their
global income in India.
Sub-section (6) of the said section provides for situations in which a person shall be “not ordinarily resident” in a previous
year. Clause (a) thereof provides that if the person is an individual who has been non-resident in nine out of the ten previous
years preceding that year, or has during the seven previous years preceding that year been in India for an overall period of
729 days or less. Clause (b) thereof contains similar provision for the HUF.
This category of persons has been carved out essentially to ensure that a non-resident is not suddenly faced with the
compliance requirement of a resident, merely because he spends more than specified number of days in India during a
particular year. The conditions specified in the present law in respect of this carve out have been the subject matter of
disputes, amendments and further disputes. Further, due to reduction in number of days, as proposed, for visiting Indian
citizen or person of Indian origin, there would be need for relaxation in the conditions.
The issue of stateless persons has been bothering the tax world for quite some time. It is entirely possible for an individual
to arrange his affairs in such a fashion that he is not liable to tax in any country or jurisdiction during a year. This arrangement
is typically employed by high net worth individuals (HNWI) to avoid paying taxes to any country/ jurisdiction on income they
earn. Tax laws should not encourage a situation where a person is not liable to tax in any country. The current rules governing
24
tax residence make it possible for HNWIs and other individuals, who may be Indian citizen to not to be liable for tax anywhere
in the world. Such a circumstance is certainly not desirable; particularly in the light of current development in the global tax
environment where avenues for double non-taxation are being systematically closed.
In the light of above, it is proposed that-
(i) the exception provided in clause (b) of Explanation 1 of sub-section (1) to section 6 for visiting India in that year be
decreased to 120 days from existing 182 days.
(ii) an individual or an HUF shall be said to be “not ordinarily resident” in India in a previous year, if the individual or the
manager of the HUF has been a non-resident in India in seven out of ten previous years preceding that year. This
new condition to replace the existing conditions in clauses (a) and (b) of sub-section (6) of section 6.
(iii) an Indian citizen who is not liable to tax in any other country or territory shall be deemed to be resident in India.
[Clause 4]
Amending definition of “work” in section 194C of the Act.
Section 194C of the Act provides for the deduction of tax on payments made to contractors. The section provides that any
person responsible for paying any sum to a resident for carrying out any work (including supply of labour for carrying out any
work) in pursuance of a contract shall at the time of such credit or at the time of payment whichever is earlier deduct an
amount equal to one per cent in case payment is made to an individual or an HUF and two per cent in other cases. Clause (iv)
of the Explanation of the said section defines “work”. Sub-clause (e) of this definition includes manufacturing or supplying a
product according to the requirement or specification of a customer by using material purchased from such customer within the
definition. However, it excludes manufacturing or supplying a product according to the requirement or specification of a
customer by using material purchased from a person, other than such customer.
It has been noted that some assessees are using the escape clause of the section by getting the contract manufacturer to
procure the raw material supplied through its related parties. As a result, a substantial amount of income escapes the tax net.
Therefore, to bring clarity in the section and plug the leakage, it is proposed to amend the definition of “work” under
section 194C to provide that in a contract manufacturing, the raw material provided by the assessee or its associate shall fall
within the purview of the ‘work’ under section 194C. Associate is proposed to be defined to mean a person who is placed
similarly in relation to the customer as is the person placed in relation to the assessee under the provisions contained in clause
(b) of sub-section (2) of section 40A of the Act.
[Clause 76]
Penalty for fake invoice.
In the recent past after the launch of Goods & Services Tax (GST), several cases of fraudulent input tax credit (ITC) claim
have been caught by the GST authorities. In these cases, fake invoices are obtained by suppliers registered under GST to
fraudulently claim ITC and reduce their GST liability. These invoices are found to be issued by racketeers who do not actually
carry on any business or profession. They only issue invoices without actually supplying any goods or services. The GST
shown to have been charged on such invoices is neither paid nor is intended to be paid. Such fraudulent arrangements
deserve to be dealt with harsher provisions under the Act.
Therefore, it is proposed to introduce a new provision in the Act to provide for a levy of penalty on a person, if it is found
during any proceeding under the Act that in the books of accounts maintained by him there is a (i) false entry or (ii) any entry
relevant for computation of total income of such person has been omitted to evade tax liability. The penalty payable by such
person shall be equal to the aggregate amount of false entries or omitted entry. It is also propose to provide that any other
person, who causes in any manner a person to make or cause to make a false entry or omits or causes to omit any entry, shall
also pay by way of penalty a sum which is equal to the aggregate amounts of such false entries or omitted entry. The false
entries is proposed to include use or intention to use –
(a) forged or falsified documents such as a false invoice or, in general, a false piece of documentary evidence; or
(b) invoice in respect of supply or receipt of goods or services or both issued by the person or any other person without
actual supply or receipt of such goods or services or both; or
(c) invoice in respect of supply or receipt of goods or services or both to or from a person who do not exist.
[Clause 98]
25
I. RATIONALISATION OF PROVISIONS OF THE ACT

Aligning purpose of entering into Double Taxation Avoidance Agreements (DTAA) with Multilateral Instrument (MLI).
Section 90 of the Act empowers the Central Government to enter into agreement with foreign countries or specified
territories (commonly known as DTAAs) for,-
(a) granting relief in respect of —
(i) income on which tax has been paid both, in India and that foreign country or territory, or
(ii) income-tax chargeable under the laws of both, India and that foreign country or territory, to promote mutual
economic relations, trade and investment.
(b) avoidance of double taxation of income under the laws of both, India and that foreign country of territory,
(c) exchange of information for prevention of evasion or avoidance of income-tax chargeable under the laws of both
India and that foreign country or territory, or investigation of cases of such evasion or avoidance, or
(d) recovery of income-tax under the laws of both India and that foreign country or territory.
Section 90A of the Act contains provision similar to section 90 of the Act so as to empower the Central Government to
adopt and implement an agreement between a specified association in India and any specified association in specified territory
outside India for granting relief, avoidance of double taxation, exchange of information and recovery of income-tax.
India has signed the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and
Profit Shifting (commonly referred to as MLI) along with representatives of many countries, which has since been ratified. India
has since deposited the Instrument of Ratification to OECD, Paris along with its Final Position in terms of Covered Tax
Agreements (CTAs), Reservations, Options and Notifications under the MLI, as a result of which MLI has entered into force for
India on 1st October, 2019 and its provisions will be applicable on India’s DTAAs from FY 2020-21 onwards.
The MLI is an outcome of the G20-OECD project to tackle Base Erosion and Profit Shifting (the BEPS Project), i.e. tax
planning strategies that exploit gaps and mismatches in tax rules to artificially shift profits to low or no-tax locations where
there is little or no economic activity, resulting in little or no overall corporate tax being paid. The MLI will modify India’s DTAAs
to curb revenue loss through treaty abuse and base erosion and profit shifting strategies by ensuring that profits are taxed
where substantive economic activities generating the profits are carried out. The MLI will be applied alongside existing DTAAs,
modifying their application in order to implement the BEPS measures.
Article 6 of MLI provides for modification of the Covered Tax Agreement to include the following preamble text:
“Intending to eliminate double taxation with respect to the taxes covered by this agreement without creating opportunities
for non-taxation or reduced taxation through tax evasion or avoidance (including through treaty-shopping arrangements
aimed at obtaining reliefs provided in this agreement for the indirect benefit of residents of third jurisdictions),”
In order to achieve this, clause (b) of sub-section (1) of section 90 of the Act which provides for providing relief in respect
of avoidance of double taxation of income under the laws of both country or territory (India and the other foreign country of
territory) is required to contain the text provided for in MLI as mentioned at para 4 above. In case of section 90A of the Act
also, similar amendment would be required to be carried out.
Therefore, it is proposed to amend clause (b) of sub-section (1) of section 90 of the Act so as to provide that the Central
Government may enter into an agreement with the Government of any country outside India or specified territory outside India
for, inter alia, the avoidance of double taxation of income under the Act and under the corresponding law in force in that
country or specified territory, as the case may be, without creating opportunities for non-taxation or reduced taxation through
tax evasion or avoidance (including through treaty-shopping arrangements aimed at obtaining reliefs provided in this
agreement for the indirect benefit of residents of any other country or territory).
It is also proposed to make similar amendment in clause (b) of sub-section (1) of section 90A of the Act.
[Clauses 41 & 42]
Deferring Significant Economic Presence (SEP) proposal, Extending source rule, Aligning exemption from taxability
of Foreign Portfolio Investors (FPIs), on account of indirect transfer of assets, with amended scheme of SEBI, and
rationalising the definition of royalty.
Section 9 of the Act contains provisions in respect of income which are deemed to accrue or arise in India. Sub-section (1)
thereof creates a legal fiction that certain incomes shall be deemed to accrue or arise in India.
26
Clause (i) of sub-section (1) deems the following income to accrue or arise in India:
“all income accruing or arising, whether directly or indirectly, through or from any business connection in India, or through
or from any property in India, or through or from any asset or source of income in India, or through the transfer of a capital
asset situate in India.”
Finance Act, 2018, inter alia, inserted Explanation 2A to said clause so as to clarify that the “significant economic
presence” (SEP) of a non-resident in India shall constitute "business connection" in India and SEP for this purpose,
shall mean:
(a) transaction in respect of any goods, services or property carried out by a non-resident in India including provision of
download of data or software in India, if the aggregate of payments arising from such transaction or transactions
during the previous year exceeds such amount as may be prescribed; or
(b) systematic and continuous soliciting of business activities or engaging in interaction with such number of users as
may be prescribed, in India through digital means.
Said Explanation further provided that the transactions or activities shall constitute significant economic presence in India,
whether or not, the agreement for such transactions or activities is entered in India; or the non-resident has a residence or
place of business in India; or the non-resident renders services in India. It was also provided that only so much of income as is
attributable to the transactions or activities mentioned at para 2(a) and (b) shall be deemed to accrue or arise in India.
Therefore, for the purposes of determining SEP of a non-resident in India, threshold for the aggregate amount of
payments arising from the specified transactions and for the number of users were required to be prescribed in the Rules.
However, since discussion on this issue is still going on in G20-OECD BEPS project, these numbers have not been notified
yet. G20-OECD report is expected by the end of December 2020. In the circumstances, it is proposed to defer the applicability
of SEP to starting from assessment year 2022-23. Certain drafting changes have also been made while deferring the proposal.
The current SEP provisions shall be omitted from assessment year 2021-22 and the new provisions will take effect from
1st April, 2022 and will, accordingly, apply in relation to the assessment year 2022-23 and subsequent assessment years.
[Clause 5]
Further, as per the discussion going on in international forum, countries generally agree that income from advertisement
that targets Indian customers or income from sale of data collected from India or income from sale of goods and services using
such data collected from India, needs to be accounted for in Indian revenue . Hence, it is proposed to amend the source rule to
clarify this position.
2021-22 and subsequent assessment years. However, for attribution of income related to SEP transaction or activities the
amendment will take effect from 1st April, 2022 and will, accordingly, apply in relation to the assessment year 2022-23 and
subsequent assessment years.
[Clause 5]
Further, the Finance Act, 2012, inter alia, had inserted Explanation 5 to said clause to clarify that an asset or capital asset
being any share or interest in a company or entity registered or incorporated outside India shall be deemed to be and shall
always be deemed to have been situated in India if the share or interest derives, directly or indirectly, its value substantially
from the assets located in India. Second proviso to said Explanation, inserted through the Finance Act, 2017, provides that the
Explanation shall not apply to an asset or capital asset, which is held by a non-resident by way of investment, directly or
indirectly, in Category-I or Category-II foreign portfolio investor under the Securities and Exchange Board of India (Foreign
Portfolio Investors) Regulations, 2014 [SEBI (FPI) Regulations, 2014].
Vide Gazette Notification No. SEBI/LAD-NRO/GN/2019/36, SEBI has notified Securities and Exchange Board of India
(Foreign Portfolio Investors) Regulations, 2019 [SEBI (FPI) Regulations, 2019] and repealed the SEBI (FPI) Regulations,
2014. The difference between these two regulations pertinent in the present context is that the SEBI has done away with the
broad basing criteria for the purposes of categorization of portfolios and has reduced the categories from three to two. In view
of the same, necessary modification needs to be made in the proviso so inserted. Hence, it is proposed that the exception from
said Explanation 5 provided to an asset or a capital asset, held by a non-resident by way of investment in erstwhile Category I
and II FPIs under the SEBI (FPI) Regulations, 2014 may be grandfathered. Further, similar exception may be provided in
respect of investment in Category-I FPI under the SEBI (FPI) Regulations, 2019.
[Clause 5]
Clause (vi) of sub-section (1) of section 9 deems certain income by way of royalty to accrue or arise in India. Explanation
2 of said clause defines the term “royalty” to, inter alia, mean the transfer of all or any rights (including the granting of a
licence) in respect of any copyright, literary, artistic or scientific work including films or video tapes for use in connection with



ADMIN1: ADMIN2:
27
television or tapes for use in connection with radio broadcasting, but not including consideration for the sale, distribution or
exhibition of cinematographic films.
Due to exclusion of consideration for the sale, distribution or exhibition of cinematographic films from the definition of
royalty, such royalty is not taxable in India even if the DTAA gives India the right to tax such royalty. Such a situation is
discriminatory against Indian residents, since India is foregoing its right to tax royalty in case of a non-resident from another
country without that other country offering similar concession to Indian resident. Hence, it is proposed to amend the definition
of royalty so as not to exclude consideration for the sale, distribution or exhibition of cinematographic films from its meaning.
[Clause 5]
It is further proposed to amend section 295 of the Act so as to empower the Board for making rules to provide for the
manner in which and the procedure by which the income shall be arrived at in the case of,-
(i) operations carried out in India by a non-resident; and
(ii) transaction or activities of a non-resident.
The amendment at clause (i) will take effect from 1st April, 2021 and will, accordingly, apply in relation to the assessment
year 2021-22 and subsequent assessment years. The amendment at clause (ii) will take effect from 1st April, 2022 and will,
accordingly, apply in relation to the assessment year 2022-23 and subsequent assessment years.
[Clause 103]
Removing dividend distribution tax (DDT) and moving to classical system of taxing dividend in the hands of
shareholders/unit holders.
Section 115-O provides that, in addition to the income-tax chargeable in respect of the total income of a domestic
company, any amount declared, distributed or paid by way of dividends shall be charged to additional income-tax at the rate of
15 per cent. The tax so paid by the company (called DDT) is treated as the final payment of tax in respect of the amount
declared, distributed or paid by way of dividend. Such dividend referred to in section 115-O is exempt in the hands of
shareholders under clause (34) of section 10. In case of business trust, specific exemption is provided under sub-section (7) of
section 115-O, subject to certain conditions. Similarly, exemption is provided for distributed profits of a unit of an International
Financial Service Centre, on fulfilment of certain conditions, under sub-section (8) of section 115-O.
Similarly under section 115R, specified companies and Mutual Funds are liable to pay additional income-tax at the
specified rate on any amount of income distributed by them to its unit holders. Such income is then exempt in the hands of unit
holders under clause (35) of section 10.
The incidence of tax is, thus, on the payer company/Mutual Fund and not on the recipient, where it should normally be.
The dividend is income in the hands of the shareholders and not in the hands of the company. The incidence of the tax should
therefore, be on the recipient. Moreover, the present provisions levy tax at a flat rate on the distributed profits, across the
board irrespective of the marginal rate at which the recipient is otherwise taxed. The provisions are hence, considered,
iniquitous and regressive. The present system of taxation of dividend in the hands of company/ mutual funds was re-
introduced by the Finance Act, 2003 (with effect from the assessment year 2004-05) since it was easier to collect tax at a
single point and the new system was leading to increase in compliance burden. However, with the advent of technology and
easy tracking system available, the justification for current system of taxation of dividend has outlived itself.
In view of above, it is proposed to carry out amendments so that dividend or income from units are taxable in the hands of
shareholders or unit holders at the applicable rate and the domestic company or specified company or mutual funds are not
required to pay any DDT. It is also proposed to provide that the deduction for expense under section 57 of the Act shall be
maximum 20 per cent of the dividend or income from units. Therefore, it is proposed to-
(i) amend section 115-O to provide that dividend declared, distributed or paid after 1st April, 2003, but on or before
31st March, 2020 shall be covered under the provision of this section.
(ii) amend clause (34) of section 10 to provide that the provision of this clause shall not apply to any income, by way of
dividend, received on or after 1st April, 2020.
(iii) amend section 115R to provide that the income distributed on or before 31st March, 2020 shall only be covered
under the provision of this section.
(iv) amend clause (35) of section 10 to provide that the provision of this clause shall not apply to any income, in respect
of units, received on or after 1st April, 2020.
(v) amend clause (23FC) of section 10 so that all dividends received or receivable by business trust from a special
purpose vehicle is exempt income under this clause.
28
(vi) amend clause (23FD) of section 10 to exclude dividend income received by a unit holder from business trust from
the exemption so that the dividend income is taxable in the hand of unit holder of the business trust.
(vii) amend sub-section (3) of section 115UA to delete reference to sub-clause (a) so that distributed income of the
nature as referred to in clause (23FC) or clause (23FCA) of section 10 shall be deemed to be income of the unit
holder and shall be charged to tax as income of the previous year. Thus dividend income distributed by a special
purpose vehicle to business trust would be taxed in the hands of unit holder.
(viii) remove reference of section 115-O dividend income in various sections like section 57, section 115A, section
115AC, section 115ACA, section 115AD and section 115C.
(ix) remove the opening line of clause (23D) of section 10, as mutual fund no longer required to pay additional tax.
(x) insert new section 80M as it existed before it removal by the Finance Act, 2003 to remove the cascading affect,
with a change that set off will be allowed only for dividend distributed by the company one month prior to the due
date of filing of return, in place of due date of filing return earlier.
(xi) amend section 115BBDA which taxes dividend income in excess of ten lakh rupee in the hands of shareholder at
ten per cent., to only dividend declared, distributed or paid by a domestic company on or before the 31st day of
March, 2020.
(xii) amend section 57 to provide that no deduction shall be allowed from dividend income, or income in respect of
units of mutual fund or specified company, other than deduction on account of interest expense and in any previous
year such deduction shall not exceed twenty per cent. of the dividend income or income from units included in the
total income for that year without deduction under section 57.
(xiii) amend section 194 to include dividend for tax deduction. At the same time the rates of ten per cent. is proposed to
be prescribed and threshold is proposed to be increased from Rs 2,500/- to Rs 5,000/- for dividend paid other than
cash. Further, at present the mode of payment is given as “an account payee cheque or warrant”. It is proposed to
change this to any mode.
(xiv) amend section 194LBA to provide for tax deduction by business trust on dividend income paid to unit holder, at the
rate of ten per cent. for resident. For non-resident, it would be 5 per cent for interest and ten per cent. for dividend.
(xv) insert a new section 194K to provide that any person responsible for paying to a resident any income in respect of
units of a Mutual Fund specified under clause (23D) of section 10 or units from the administrator of the specified
undertaking or units from the specified company shall at the time of credit of such income to the account of the
payee or at the time of payment thereof by any mode, whichever is earlier, deduct income-tax there on at the rate
of ten per cent. It may also be provided for threshold limit of Rs 5,000/- so that income below this amount does not
suffer tax deduction. It is also proposed to defined “Administrator”, “specified company”, as already defined in
clause (35) of section 10. It is also proposed to define “specified undertaking” as in clause (i) of section 2 of the
Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002. It is also proposed to provide that where any
income is credited to any account like suspense account, in the books of account of the person liable to pay such
income, the liability for tax deduction under this section would arise at that time.
(xvi) amend section 195 to delete exemption provided to dividend referred to in section 115-O.
(xvii) amend section 196A to revive its applicability on TDS on income in respect of units of a Mutual Fund. It is also
proposed to substitute “of the Unit Trust of India” with “from the specified company defined in Explanation to clause
(35) of section 10”and “in cash or by the issue of a cheque or draft or by any other mode” with “by any mode”.
(xviii) amend section 196C to remove exclusion provided to dividend under section 115-O. It is also proposed to
substitute “in cash or by the issue of a cheque or draft or by any other mode” with “by any mode”.
(xix) amend section 196D to remove exclusion provided to dividend under section 115-O. It is also proposed to
substitute “in cash or by the issue of a cheque or draft or by any other mode” with “by any mode”.
Amendments at clause (i) to (xii) above will take effect from 1st April, 2021 and will, accordingly, apply in relation to the
assessment year 2021-22 and subsequent assessment years. Amendments at clause (xiii) to (xix) will take effect from
1st April, 2020.
[Clauses 7,30,40,47,48,49,50,54,55,59,60,62,74,80,81,85,86,87 & 88]
Rationalization of provisions of section 55 of the Act to compute cost of acquisition.
The existing provisions of section 55 of the Act provide that for computation of capital gains, an assessee shall be allowed
deduction for cost of acquisition of the asset and also cost of improvement, if any. However, for computing capital gains in
respect of an asset acquired before 1st April, 2001, the assessee has been allowed an option of either to take the fair market
value of the asset as on 1st April, 2001 or the actual cost of the asset as cost of acquisition.
It is proposed to rationalise the provision and to insert a proviso below sub-clause (ii) of clause (b) of Explanation under
clause (ac) of sub-section (2) of the said section to provide that in case of a capital asset, being land or building or both, the
29
fair market value of such an asset on 1st April, 2001 shall not exceed the stamp duty value of such asset as on 1st April, 2001
where such stamp duty value is available. It is also proposed to insert an Explanation so as to provide that for the purposes of
sub-clause (i) and (ii), "stamp duty value" shall mean the value adopted or assessed or assessable by any authority of the
Central Government or a State Government for the purpose of payment of stamp duty in respect of an immovable property.
[Clause 28]
Rationalisation of provisions relating to trust, institution and funds.
Amendment of sub-section (7) of section 11 to allow entities holding registration under section 12A/12AA to apply for
notification under clause (46) of section 10
Section 11 of the Act provides for grant of exemption in respect of income derived from property held under trust for
charitable or religious purposes to the extent to which such income is applied or accumulated during the previous year for such
purposes in accordance with the provisions contained in sections 11, 12, 12A, 12AA and 13 of the Act.
Sub-section (7) of section 11 of the Act, inserted by the Finance (No. 2) Act, 2014 with effect from 1st April, 2015,
provides that where a trust or an institution has obtained registration under section 12AA [as it stood immediately before its
proposed amendment] or under section 12A [as it stood immediately before its amendment by the Finance (No 2) Act, 1996]
and said registration is in force for any previous year, then, exemption under section 10 [except under clauses (1) and (23C)]
shall not be allowed.
This sub-section was inserted on the basis that the provisions contained in sections 11, 12, 12A, 12AA and 13 of the Act
constitute a complete code and that once any trust or institution has voluntarily opted for it by obtaining registration required for
exemption of income, it should comply with the conditions of such exemption and in case of violation of such condition, if its
income or part thereof becomes ineligible for exemption, no other provision of the Act should operate so as to exclude such
income or part thereof from total income and that whether income which needs to be applied or accumulated under section 11
of the Act should include income which is exempt under section 10 of the Act.
It has been noticed that there is some anomaly by providing exclusion to institutions or fund registered under clause (23C)
of section 10, but the same exclusion is not available to entities claiming exemption under clause (46) of section 10 which are
established or constituted under a Central or State Act or by a Central or State Government. Such entities are, thus, not able
to get notified under clause (46) of section 10 if they are holding registration under section 12A/12AA.
The anomaly pointed out above, needs to be addressed. However, as the provisions relating to charitable entities
constitute a complete code and that once any trust or institution has voluntarily opted for it by obtaining the requisite
registration, it flows that the conditions in relation thereto should be complied with and the option of switching at convenience
should not be available. Accordingly, while request for exclusion of clause (46) may be acceded to for exemption thereunder
even in those cases where registration under section 12AA or 12A remains in force, there should be only one mode of
exemption available and also, that the switching may be allowed only once so that such switching is not done routinely and
also it remains efficient to be administered.
Rationalising the process of registration of trusts, institutions, funds, university, hospital etc and approval in the case
of association, university, college, institution or company etc
The present process of registration of trusts, institutions, funds, university, hospital etc under section 12AA or under
sub-clauses (iv), (v), (vi) or (via) of clause (23C) of section 10, and approval of association, university, college, institution or
company etc need improvement with the advent of technology and keeping in mind the practical issue of difficulty in obtaining
registration/ approval/ notification before actually starting the activities.
It is also felt that the approval or registration or notification for exemption should also be for a limited period, say for a
period not exceeding five years at one time, which would act as check to ensure that the conditions of approval or registration
or notification are adhered to for want of continuance of exemption. This would in fact also be a reason for having a
non-adversarial regime and not conducting roving inquiry in the affairs of the exempt entities on day to day basis, in general,
as in any case they would be revisiting the concerned authorities for new registration before expiry of the period of exemption.
This new process needs to be provided for both existing and new exempt entities.
Filing of statement of donation by donee to cross-check claim of donation by donor
It may further be mentioned that certain provisions of the Act provide that an exempt entity may accept donations or
certain sum for utilisation towards their objects or activities in respect of which the payer, being the donor, gets deduction in
computation of his income. At present, there is no reporting obligation by the exempt entity receiving donation/ any sum in
respect of such donation/ sum. With the advancement in technology, it is now feasible to standardise the process through
which one-to-one matching between what is received by the exempt entity and what is claimed as deduction by the assessee.
This standardisation may be similar to the provisions relating to the tax collection/ deduction at source, which already exist in
the Act. Therefore, the entities receiving donation/ sum may be made to furnish a statement in respect thereof, and to issue a
certificate to the donor/ payer and the claim for deduction to the donor/ payer may be allowed on that basis only. In order to
30
ensure proper filing of the statement, levy of a fee and penalty may also be provided in cases where there is failure to furnish
the statement.
Hence, it is proposed to amend relevant provisions of the Act to provide that,-
(i) similar to exemptions under clauses (1) and (23C), exemption under clause (46) of section 10 shall be allowed to
an entity even if it is registered under section 12AA subject to the condition that the registration shall become
inoperative. If the entity wishes to make it operative in the future, it will have to file an application and then it would
not be entitled for deduction under clause (46) from the date on which the registration becomes operative.
(ii) the registration under section 12AA would also become inoperative in case of an entity exempt under clause (23C)
of section 10 as well, to have uniformity. The condition about making it operative again would also be similar to
what is proposed for clause (46) of section 10.
(iii) an entity approved, registered or notified under clause (23C) of section 10, section 12AA or section 35 of the Act,
as the case may be, shall be required to apply for approval or registration or intimate regarding it being approved,
as the case may be, and on doing so, the approval, registration or notification in respect of the entity shall be valid
for a period not exceeding five previous years at one time calculated from 1st April, 2020.
(iv) an entity already approved under section 80G shall also be required to apply for approval and on doing so, the
approval, registration or notification in respect of the entity shall be valid for a period not exceeding five years at
one time.
(v) application for approval under section 80G shall be made to Principal Commissioner or Commissioner.
(vi) an entity making fresh application for approval under clause (23C) of section 10, for registration under section
12AA, for approval under section 80G shall be provisionally approved or registered for three years on the basis of
application without detailed enquiry even in the cases where activities of the entity are yet to begin and then it has
to apply again for approval or registration which, if granted, shall be valid from the date of such provisional
registration. The application of registration subsequent to provisional registration should be at least six months prior
to expiry of provisional registration or within six months of start of activities, whichever is earlier.
(vii) the application pending for approval, registration, as the case may be, shall be treated as application in accordance
with the new provisions, wherever they are being provided for.
(viii) deduction under section 80G/ 80GGA to a donor shall be allowed only if a statement is furnished by the donee who
shall be required to furnish a statement in respect of donations received and in the event of failure to do so, fee and
penalty shall be levied.
(ix) similar to section 80G of the Act, deduction of cash donation under section 80GGA shall be restricted to
Rs 2,000/- only.
These amendments will take effect from 1st June, 2020.
[Clauses 7,9,11,12,17,33,34,61,94,96 & 99]
Expanding the eligibility criteria for appointment of member of Adjudicating Authority under the Prohibition of
Benami Property Transaction Act, 1988.
The existing provisions of section 9 of the PBPT Act, inter-alia, provides that, a member of the Indian Revenue Service
who has held the post of Commissioner of Income-tax or equivalent post in that Service; or a member of the Indian Legal
Service who has held the post of Joint Secretary or equivalent post in that Service is qualified for appointment as a Member of
the Adjudicating Authority.
It is proposed to amend the said section so as to provide that a person who is qualified for appointment as District Judge
shall also be eligible for the appointment as a Member of the Adjudicating Authority.
[Clause 143]
Rationalisation of provisions relating to tax audit in certain cases.
Under section 44AB of the Act, every person carrying on business is required to get his accounts audited, if his total sales,
turnover or gross receipts, in business exceed or exceeds one crore rupees in any previous year. In case of a person carrying on
profession he is required to get his accounts audited, if his gross receipt in profession exceeds, fifty lakh rupees in any previous
year.
In order to reduce compliance burden on small and medium enterprises, it is proposed to increase the threshold limit for a
person carrying on business from one crore rupees to five crore rupees in cases where,-
(i) aggregate of all receipts in cash during the previous year does not exceed five per cent of such receipt; and
(ii) aggregate of all payments in cash during the previous year does not exceed five per cent of such payment.
31
Further, to enable pre-filling of returns in case of persons having income from business or profession, it is required that
the tax audit report may be furnished by the said assessees at least one month prior to the due date of filing of return of
income. This requires amendments in all the sections of the Act which mandates filing of audit report along with the return of
income or by the due date of filing of return of income. Thus, provisions of section 10, section 10A, section 12A, section 32AB,
section 33AB, section 33ABA, section 35D, section 35E, section 44AB, section 44DA, section 50B, section 80-IA, section
80-IB, section 80JJAA, section 92F, section 115JB, section 115JC and section 115VW of the Act are proposed to be amended
accordingly.
Further, the due date for filing return of income under sub-section (1) of section 139 is proposed to be amended by:-
(A) providing 31st October of the assessment year (as against 30th September) as the due date for an assessee
referred to in clause (a) of Explanation 2 of sub-section (1) of Section 139 of the Act;
(B) removing the distinction between a working and a non-working partner of a firm with respect to the due date as
mentioned in sub-clause (iii) of clause (a) of Explanation 2 of sub-section (1) of Section 139 of the Act.
[Clauses 7,8,10,14,15,16,19,20,23,24,26,35,37,39,45,56,57,63 & 66]
The amendment relating to extending threshold for getting books of accounts audited will have consequential effect on
TDS/TCS provisions contained in sections 194A, 194C, 194H, 194I, 194J and 206C as these provisions fasten liability of
TDS/TCS on certain categories of person, if the gross receipt or turnover from the business or profession carried on by them
exceed the monetary limit specified in clause (a) or clause (b) of section 44AB.
Therefore, it is proposed to amend these sections so that reference to the monetary limit specified in clause (a) or clause
(b) of section 44AB of the Act is substituted with rupees one crore in case of the business or rupees fifty lakh in case of the
profession, as the case may be.
[Clauses 75,76,77,78,79 & 93]
Rationalisation of provision relating to Form 26AS
Section 203AA of the Act, inter-alia, requires the prescribed income-tax authority or the person authorised by such
authority referred to in sub-section (3) of section 200, to prepare and deliver a statement in Form 26AS to every person from
whose income, the tax has been deducted or in respect of whose income the tax has been paid specifying the amount of tax
deducted or paid.
The Form 26AS as prescribed in the Rules, inter-alia, contains the information about tax collected or deducted at source.
However, with the advancement in technology and enhancement in the capacity of system, multiple information in respect of a
person such as sale/purchase of immovable property, share transactions etc. are being captured or proposed to be captured.
In future, it is envisaged that in order to facilitate compliance, this information will be provided to the assessee by uploading the
same in the registered account of the assessee on the designated portal of the Income-tax Department, so that the same can
be used by the assessee for filing of the return of income and calculating his correct tax liability.
As the mandate of Form 26AS would be required to be extended beyond the information about tax deducted, it is
proposed to introduce a new section 285BB in the Act regarding annual financial statement. This section proposes to mandate
the prescribed income-tax authority or the person authorised by such authority to upload in the registered account of the
assessee a statement in such form and manner and setting forth such information, which is in the possession of an income-tax
authority, and within such time, as may be prescribed.
Consequently, section 203AA is proposed to be deleted.
These amendments will take effect from 1st June, 2020.
[Clauses 90]
Rationalisation of the provisions of section 49 and clause (42A) of section 2 of the Act in respect of segregated
portfolios.
Section 49 of the Act provides for cost of acquisition for the capital asset which became the property of the assessee
under certain situations. Further, clause (42A) of section 2 of the Act provides the definition of the term “short-term capital
asset”. It also provides for determination of period of holding of the capital asset held by the assessee.
SEBI has, vide circular SEBI/HO/IMD/DF2/CIR/P/2018/160 dated December 28, 2018, permitted creation of segregated
portfolio of debt and money market instruments by Mutual Fund schemes. As per the SEBI circular, all the existing unit holders
in the affected scheme as on the day of the credit event shall be allotted equal number of units in the segregated portfolio as
held in the main portfolio. On segregation, the unit holders come to hold same number of units in two schemes –the main
scheme and segregated scheme.
32
In view of the above, it is proposed to amend sub-section (42A) of section 2 of the Act to provide that in the case of a
capital asset, being a unit or units in a segregated portfolio, referred to in sub-section (2AG) of section 49, there shall be
included the period for which the original unit or units in the main portfolio were held by the assessee.
Further, a new sub-section (2AG) is proposed to be inserted in section 49 of the Act to provide that the cost of acquisition
of a unit or units in the segregated portfolio shall be the amount which bears to the cost of acquisition of a unit or units held by
the assessee in the total portfolio, the same proportion as the net asset value of the asset transferred to the segregated
portfolio bears to the net asset value of the total portfolio immediately before the segregation of portfolios.
It is also proposed to insert another sub-section (2AH) in the said section to provide that the cost of the acquisition of the
original units held by the unit holder in the main portfolio shall be deemed to have been reduced by the amount as so arrived at
under the proposed sub-section (2AG).
The Explanation below these two new sub-sections, as proposed to be inserted, provide that for the purposes of
sub-sections (2AG) and (2AH), the expressions “main portfolio”, “segregated portfolio” and “total portfolio” shall have the
meaning respectively assigned to them in the said circular dated 28th December, 2018 issued by SEBI.
[Clauses 3 & 25]
Amendment in the provisions of Act relating to verification of the return of income and appearance of authorized
representative.
Section 140 of the Act provides that in case of company the return is required to be verified by the managing director (MD)
thereof. Where the MD is not able to verify for any unavoidable reason or where there is no MD, any director of the company
can verify the return. It is also provided that in case of a company in whose case application for insolvency resolution process
has been admitted by the Adjudicating Authority (AA) under the Insolvency and Bankruptcy Code, 2016 (IBC), the return has
to be verified by the insolvency professional appointed by such AA. Similarly, in case of a limited liability partnership (LLP), the
return has to be verified by the designated partner of the LLP or by any partner, in case there is no such designated partner.
Therefore, it is proposed to amend clause (c) and (cd) of section 140 of the Act so as to enable any other person, as may
be prescribed by the Board to verify the return of income in the cases of a company and a limited liability partnership.
Further, section 288 of the Act provides for the persons entitled to appear before any Income-tax Authority or the
Appellate Tribunal, on behalf of an assessee, as its “authorised representative”, in connection with any proceedings under that
Act. While the IBC empowers the Insolvency Professional or the Administrator to exercise the powers of the Board of Directors
or corporate debtor, it has been reported that lack of explicit reference in section 288 of the Act for an Insolvency Professional
to act as an authorised representative of the corporate debtor has been raising certain practical difficulties.
Therefore, it is proposed to amend sub-section (2) of section 288 to enable any other person, as may be prescribed by the
Board, to appear as an authorised representative.
[Clauses 67 & 102]

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KEY TO BUDGET DOCUMENTS

EBOOKS & UPSC PRELIMS USPC MAINS VIDEO FOR DAILY

SECUREIAS UPSC PRELIMS UPSC MAINS DELHI CIVILSERVICES

OPTIONAL SUBJECTS BOOKS, STATE PCS, SSC, BANKING

D. Statements mandated under FRBM Act.

I. Memorandum Explaining the Provisions in the Finance Bill

Agriculture, Irrig Industry, Comm Women &

Wellness, Water Culture and

Education and Environment and

• Deposit Insurance Coverage to increase from `1 lakh to `5

• Specified categories of government securities would be opened

4.1 4.2 51 2.5

Central Government Debt as per cent of GDP

External Debt as per cent of GDP at current

National Infrastructure Pipeline

2011-12 2017-18 Irrigation

Revenue Receipts (in ` crore) Capital Receipts (in Rs.

Non Tax Revenue

Dividend Distribution Tax removed and classical system

Simplified and New Income Tax Regime as an option to

Simplified GST return shall be implemented from 1st April

PM KUSUM to cover 20 lakh farmers for stand alone solar

• Viability gap funding for creation of

“Kisan Rail” and “Krishi Udaan” to be • Fish Production

Coverage • “TB Harega Desh Jeetega” campaign

• ODF Plus to sustain ODF behaviour.

IMR U5MR 2019-20 (RE) 2020-21 (BE)

Allocation 2020-21 (BE) Study in

• Degree level online

• NIRVIK Scheme for higher export credit disbursement

• Extension of invoice financing to MSMEs through TReDs.

• Power: Efforts to replace conventional energy

• Gas Grid: Expand National Gas Grid to 27,000 km

• Infrastructure Financing: `103 lakh crore National

Bharat Net (` crore) Accelerated road development

Nutrition related programmes

PM KISAN Pradhan Mantri Swasthya

Rs. 50040 Ministry of Housing and Urban Affairs

Rs. 67112 Ministry of Health and Family Welfare

Rs. 72216 Ministry of Railways

Ministry of Road Transport

Rs. 99312 Ministry of Human Resource

Rs. 122398 Ministry off Rural Development

Rs. 142762 Ministry of Agriculture and Farmers’

Rs. 167250 Ministry of Home Affairs

Rs. 471378 Ministry of Defence

budgetary variables through charts and graphs.

cè* Grants for Creation of Capital Assets. Primary Deficit

is measured as Fiscal Deficit less interest payments.

+ÉÉÊvÉBÉE cè* (2018-19) by `3,83,439 crore.

` 2,02,705 BÉE®Éä½ +ÉÉÊvÉBÉE cè* `2,02,705 crore over RE (2019-20).

4. {ÉÚÆVÉÉÒ |ÉÉÉÎ{iÉªÉÉÆ¹ 4. Capital Receipts 762197 823588 848451 1021304

âó{ÉªÉÉ BÉEcÉÆ ºÉä +ÉÉiÉÉ cè Rupee Comes From

(¤ÉVÉ] Budget 2019-20)

=vÉÉ® +ÉÉè® +ÉxªÉ näªÉiÉÉAÆ

àÉÉãÉ +ÉÉè® ºÉä´ÉÉ BÉE®

âó{ÉªÉÉ BÉEcÉÆ VÉÉiÉÉ cè Rupee Goes To

BÉäExpÉÒªÉ |ÉÉªÉÉäÉÊVÉiÉ ªÉÉäVÉxÉÉAÆ

PÉÉ]ä BÉEÉ ºÉÉ® Deficit Statistics

2. ®ÉVÉº´É PÉÉ]É 2. Revenue Deficit 454483 485019 499544 609219

4. |ÉÉlÉÉÊàÉBÉE PÉÉ]É 4. Primary Deficit 66770 43289 141741 88134

®ÉVÉBÉEÉäKÉÉÒªÉ PÉÉ]É ÉÊ´ÉkÉ{ÉÉäKÉhÉ BÉäE »ÉÉäiÉ Sources of Financing Fiscal Deficit

2018-2019 2019-2020 2019-2020 2020-2021