Direct Tax Summary For Ay 2023-24

FOR
ASSESSMENT YEAR
2023-24
Chapter. Particular- Page
No. No.
1. Tax Rates for AY 2023-24 & Some Important Notes 1-6
2. Capital gain 7-14
3. Prevention and Circulation of Unaccounted Money. 15-16
4. Profit or gain of Business or Profession 17-24
5. Deduction 25-26
6. Exemption 27
7. Tax Deduction at Source 28-35
8. Tax Collection at Source 36-37
This book is under process ALL other chapter of ca final will be

included soon.
My other complete book of CA FINAL
FINANCIAL REPORTING
STRATEGIC FINANICAL MANAGEMENT
ADVANCED AUDITING AND PROFESSIONAL ETHICS
CORPORATE AND ALLIED LAW
1
Chapter – 1: TAX RATES
TAX RATES, SURCHARGE AND MARGINAL RELEIF

SECTION DESCRIPTION AND CONCLUSION
TAX INDIVIDUAL AND OTHER SENIOR CITIZEN SUPER SENIOR Co-operative Society
RATES (≥60year <80year) CITIZEN
(≥80year)
INCOME (Lacs) RATES INCOME RATES INCOM RATES Income Rates
0-2.5 L NIL 0-3 L NIL E 0-10k 10%
2.5-5 L 5% 3-5 L 5% 10-20k 20%
5-10 L 20% 5-10 L 20% 0-5 L NIL >20k 30%
>10 L 30% >10 L 30% 5-10 L 20%
>10 L 30%
DOMESTIC COMPONY FOREIGN PARTNERSHIP FIRM
COMPONY
INCOME RATES INCOM RATES INCOME RATES
Domestic Companies with Turnover of up to Rs. 25% E ALL 30%
400 Crores during the Preceding Previous Financial
Year 2018-19. ALL 40% INCOME
or INCOME
Manufacturing Companies incorporated on or after
01.03.2016
Start-ups Registered from 01-03-2016 to 31-03- 0% -For 3 out of 7 years
2019 [MAT applicable under 115JB]
[Section 80 IAC]
All other Domestic Company 30%
U/S 87A Resident Individual and HUF having income up to 5,00,000 entitled to rebate of Rs. 12,500 From
there calculated Tax. Calculated income tax increased with Education Cess @ 4% on income tax and
APPLICABLE SURCHARGE .
All Deduction and exemption will be available Only under above old regime.
Optional Alternative Provision Without claiming deduction for

Individual ,Domestic Company & Co-operative Society.
For an individual or a Provided

Hindu undivided family. (2) For the purposes of sub-section (1), the total income of the individual or
Section – 115BAC Hindu undivided family shall be computed,—
INCOME RATES (i) without any exemption or deduction under the provisions of
clause (5) or clause (13A) or prescribed under clause (14) (other than those
(Lacs)
as may be prescribed for this purpose) or clause (17) or clause (32), of
0 – 2.5 Lakh NIL section 10 or section 10AA or section 16 or clause (b) of section 24 (in
2.5-5 LAKH 5% respect of the property referred to in sub-section (2) of section 23) or clause
(iia) of sub-section (1) ofsection 32 or section 32AD or section 33AB or
₹5-7.5 lakh 10% section 33ABA or sub-clause (ii) or sub-clause (iia) or sub-clause (iii) of
₹7.5 – 10 L 15% sub-section (1) or
₹10 L – 12.5 L 20% sub-section (2AA) of section 35 or section 35AD or section 35CCC or
clause (iia) of section 57 or under any of the provisions of Chapter
₹12.5 L – 15 L 25%
VI-A other than the provisions of sub-section (2) of section 80CCD (NPS)
>₹15 L 30% or section 80JJAA or 80M;
www.camdimran.com, capassed@gmail.com, Contact Number: 9534019752

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(ii) without set off of any loss,—

(a) carried forward or depreciation from any earlier assessment year, if such
A taxpayer having no loss or depreciation is attributable to any of the deductions referred to in
business income can opt clause (i);
for the old regime or the (b) under the head “Income from house property” with any other head of
income;
New regime every year
upon analysing whatever (iii) by claiming the depreciation, if any, under any provision of section 32,
is more beneficial. except clause (iia) of sub-section (1) of the said section, determined in such
However, a taxpayer manner as may be prescribed; and
having a business
income / or professional (iv) without any exemption or deduction for allowances or perquisite, by
whatever name called, provided under any other law for the time being in
can’t withdraw from the force.
option so exercised. only
once he can opt and
thereafter he/she cannot
change the same. The
said condition has also
been extended to income
from profession as well.
Conditional & Optional – Once opted can’t be subsequently Withdrawn.

For Domestic Companies Subject to following condition
22% (Section - 115BAA) 1. Such companies should not avail any exemptions/incentives under
different provisions of income tax. Therefore, the total income of
such company shall be computed without:
1. Claiming any deduction especially available for units
established in special economic zones under section
10AA
2. Claiming additional depreciation under section 32 and
investment allowance under section 32AD towards new
plant and machinery made in notified backward areas in
the states of Andhra Pradesh, Bihar, Telangana, and
West Bengal
3. Claiming deduction under section 33AB for tea, coffee and
rubber manufacturing companies
4. Claiming deduction towards deposits made towards site
restoration fund under section 33ABA by companies
engaged in extraction or production of petroleum or

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15% (Section – 115BAB) natural gas or both in India

For New Company 5. Claiming a deduction for expenditure made for scientific
incorporated on or after 1 research under section 35
October 2019 and has 6. Claiming a deduction for the capital expenditure incurred
commenced by any specified business under section 35AD
manufacturing on or 7. Claiming a deduction for the expenditure incurred on an
before 31 March 2023. agriculture extension project under section 35CCC or on
Such a company should skill development project under section 35CCD
8. Claiming deduction under chapter VI-A in respect to
certain incomes, which are allowed under section 80IA,
80IAB, 80IAC, 80IB and so on, except deduction under
section 80JJAA or 80M.
9. Claiming a set-off of any loss carried forward from earlier
years, if such losses were incurred in respect of the
aforementioned deductions
2. Such companies will have to exercise this option to be taxed under
the section 115BAA on or before the due date of filing income tax
returns i.e usually 30th September of the assessment year. Once
the company opts for section 115BAA in a particular financial year,
it cannot be withdrawn subsequently.
3. The domestic companies opting for section 115BAA will not be
able to claim MAT credits for taxes paid under MAT during the tax
holiday period.
4. Shall not be allowed to claim set-off of any brought forward
depreciation (additional depreciation) for the assessment year in
which the option has been exercised and future assessment years.
For Co-operative Society Subject to following condition
22 % 1. Such society should not avail any exemptions/incentives under

different provisions of income tax. Therefore, the total income of such
company shall be computed without:
(Under Section –
115BAD) 1. Claiming any deduction especially available for units
established in special economic zones under section
10AA
failure to satisfy 2. Claiming additional depreciation under section 32 and
specified conditions investment allowance under section 32AD towards new
plant and machinery made in notified backward areas in
would disqualify it the states of Andhra Pradesh, Bihar, Telangana, and
for the concessional West Bengal
rate and normal 3. Claiming deduction under section 33AB for tea, coffee and
provisions of the Act rubber manufacturing companies
shall apply. 4. Claiming deduction towards deposits made towards site
restoration fund under section 33ABA by companies
engaged in extraction or production of petroleum or
natural gas or both in India
5. Claiming a deduction for expenditure made for scientific
research under section 35
6. Claiming a deduction for the capital expenditure incurred
by any specified business under section 35AD
7. Claiming a deduction for the expenditure incurred on an
agriculture extension project under section 35CCC or on
skill development project under section 35CCD
8. Claiming deduction under chapter VI-A in respect to
certain incomes, which are allowed under section 80IA,
80IAB, 80IAC, 80IB and so on, except deduction under
section 80JJAA or 80M.
9. Claiming a set-off of any loss carried forward from earlier
years, if such losses were incurred in respect of the
aforementioned deductions
6. Such Society will have to exercise this option to be taxed under the

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section 115BAA on or before the due date of filing income tax

returns i.e usually 30th September of the assessment year. Once
the company opts for section 115BAA in a particular financial year,
it cannot be withdrawn subsequently.
7. 115JC of the Act will not be applicable accordingly will not be able
to claim MAT credits for taxes paid under MAT during the tax
holiday period.
8. Shall not be allowed to claim set-off of any brought forward
depreciation (additional depreciation) for the assessment year in
which the option has been exercised and future assessment years.
SURCHARGE INDIVIDUAL, HUF, , FIRM & LLP LOCAL DOMESTIC COMPONY FOREIGN COMPONY
AUTHORITY,AOP,BOI, Co-
operative society
INCOME SURCHARGE INCOM SURCHARGE INCOME SURCHARGE INCOME SURCHARGE
>50 Lakh 10% E >1 7% >1 CRORE ≤10 2%
to 1 Crore >1 12% CRORE CRORE
1-2 Crore 15% Crore ≤10 ≥10 CRORE 5%
2-5 Crore 25% CRORE
>5 Crore 37%
≥10 12%
CRORE
MARGINAL
RELEIF
ASSESSEE CALCULATION
Individual, (TAX ON 1 CRORE )+(TOTAL INCOME – 1 CRORE)
HUF,
LOCAL AUTHOITY
DOMESTIC (TAX ON 1 CRORE )+(TOTAL INCOME – 1 CRORE)

COMPONY
IF THE TOTAL INCOME EXCEED 10 CRORE
(TAX ON 10 CRORE WITH SURCHARGE OF 7%)+(TOTAL INCOME – 1 CRORE)
FOREIGN COMPONY (TAX ON 1 CRORE )+(TOTAL INCOME – 1 CRORE)
IF THE TOTAL INCOME EXCEED 10 CRORE

(TAX ON 10 CRORE WITH SURCHARGE OF 2%)+(TOTAL INCOME – 1 CRORE)
Marginal relief is granted so as to additional income tax doesn’t exceed addition income..
MAT Minimum Alternate Tax (M.A.T.) - The rate of MAT payable by a company is 15% u/s 115 JB.
a) The period allowed to carry forward the tax credit under MAT is further extended to 15 (Fifteen) years.
MAXIMUM CASH EXPENSES ALLOABLE
NATURE OF I. T. EXISTING NEW IN CASE OF VIOLATION
EXPENDITURE SECTION LIMIT LIMIT
CAPITAL – Purchase 43 No Limit 10000/- The expenditure shall not be included in the cost of asset.
of Fixed Assets per day No Depreciation benefit.
REVENUE – 35AD No Limit 10000/- No deduction shall be allowed in respect of such
Expenditure on per day per expenditure.
Specified Business asset

5
REVENUE – General 40 A (3) 20000/- 10000/- No deduction shall be allowed in respect of such
Expenditure per day to per day to expenditure.
a person a person
Any Payment 269ST No Limit 2,00,000/- Penalty u/s 271DA equal to the amount of such payment
received:- received by a person.
(a) in aggregate
from a person in a
day;
(b) in respect of a
single transaction;
or
(c) in respect of
transactions
relating to one
event or occasion
from a person,
Recent important Amendment
Cash withdrawal limit from bank
Nature of Payment Payer (Deductor) Payee Rate Exemption Limit (No TDS
TDS (Deductee) of TDS to be Deducted upto
UNDER threshold limit
SECTION mentioned)
Cash withdrawal in Any bank Any Person 2% 1,00,00,000.00
excess of Rs. 1 crore (private or public (Provided who had not
during the previous year sector) filed return for all AY 3
from one or more A co-operative year limit would be
account maintained by a bank 20,00,000 and on
person with a banking A post office exceeding 20,00,000.00 up
194N company, co-operative to 1,00,00,000.00 Rate
society engaged in would be 2%)
business of banking or a 5% For assess who had not
post office. filed any return for last 3
ASSESSMENT YEAR, on
excess of 1,00,00,000.00
Tax Collection at Source
Section Types of Goods Rate

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Every tour operator on tour package for foreign tour (Outside India) AND
An authorised dealer receiving money for remittance outside india under
libralised Remittance Scheme.
will collect TCS of 5% on sum received in excess of 7,00,000 (In a financial year).
If sum exceed 7,00,000 in a financial year.
5%
Provided
206C (1G) If payment is out of loan taken for education purpose(u/s 80E) 1.50%
Seller who receive for sale of any goods of the value or aggregate of such value
exceeding Rs. - 50,00,000.00 in any previous year, other than export, at the
time of receipt of such amount, collect from the buyer, a sum equal to 0.1 per cent.
of the sale consideration exceeding fifty lakh rupees as income-tax:
206C (1H) In case of NO PAN u/s 206CC @1% 0.1%
Other
1. Provision for determination of resident status for NRI has changed;
2. Safe Harbour limit of 5% increased to 10% under section 43CA, 50C, and 56 of the Act;
3. Contribution to EPF, NPS and superannuation fund restricted to ₹ 7,50,000/- per annum;
4. Deduction for payment to insurance companies shall be allowed on payment basis under section 43B;
5. Threshold limit for tax audit under section 44AB has been extended from 1 Crore to 5 Crore in certain cases;
6. Cash donation limit under section 80GGA restricted to ₹ 2000/- only;
7. TDS shall be deducted @ 10 on the payment of divided instead of DDT;
8. TDS shall be deducted @ 2% on payment made for FTS and Royalty;
9. Definition of work contract has amended under section 194C;
10. Benefit of concessional tax scheme under section 115BAB to the domestic company shall be available the
company engaged in the business of generation of electricity;
11. No deduction shall be allowed under chapter VI-A other than 80JJAA or 80M to the domestic company opting
concessional tax scheme under section 115BAA and 115BAB;
12. Additional deduction under section 80EEA of ₹ 150000/- shall be allowed on House loan under affordable
Housing scheme if loan sanctioned up to 31-03-21;
13. Deduction under section 80IBA shall be available for affordable housing project for FY 2020-21;

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Chapter -4: CAPITAL GAIN
SECTION DESCRIPTION AND GIST

45(1) CHARGING SECTION
Capital gain& loss, Chargeable under the head of capital gain in the previous year in which TRANSFER
of CAPITAL ASSETES took place. Except section 45(1A),45(2) and 45(5)
Secton 2(47) TRANSFER means sales, exchange, relinquishment, extinguishment(right cease),
compulsory acquisition, conversion of capital assets in to stock in trade, possession transfer even due
to part performance without transfer of right.
Explanation(F.Act-2012)Disposing, parting with an asset or any interest therein /creating interest
therein, from transfer of share or shares of a company registered or incorporated outside india.
Section 2(14) CAPITAL ASSETS means all property in kind except (i)SIT, consumable stores & Raw
material (ii) Personnel affect (excluding JADPSA), (III)Agricultural land (iv)Gold deposit bond issued
under gold deposit scheme 1999. ,
Explanation (F.Act-2012) Any right in relation to Indian company.
PTBR : JADPSA are capital assets. Jewellery, Archaeological collection, Drawing, Painting, Sculptures,
Any other work of art.
45(1A) INSURANE CLAIM
Transfer took place in the year of damage or destruction but Taxable in the year of Receipt of
insurance claim.
Capital gain / loss
Sale consideration (FMV or insurance claim) √
Less:
Cost of Acquisition/ indexed cost of acquisition
Cost of improvement / indexed cost of improvement √
Capital gain/ loss √
45(2) CONVERSION OF CAPITAL ASSETS IN TO STOK IN TRADE

Transfer took place in the year of Conversion but Taxable in the year of Sale. Indexation will be made
from the date of acquisition till the date of conversion in to stock in trade.
Capital gain / loss
Sale consideration (FMV) √
Less:
Business income / loss
Sales value √
Less: FMV √
Business income/loss √
45(5) COMPULSORY ACQUISITION
Transfer took place in the year of compulsory Acquisition and indexed accordingly but taxable in the
year of first receipt even part there of original compensation, taking in to consideration full original
compensation. Enhanced compensation is taxable in the year of receipt of claim no any expenses
allowed except legal expenses. Interest received on compensation of enhanced compensation taxable
u/h of IFOS and no any deduction allowed under any clause except section 57 deductions of flat 50%.
Capital gain / loss
Sale consideration (original compensation) √
Less:
PTBR : Deduction u/s 57 is allowed only for INTEREST, not for original or enhanced compensation
8
48 METHOD OF COMPUTATION OF CAPITAL GAIN

FULL VALUE OF CONSIDERATION RECEIVED/ RECEIVABLE (Actual,FMV,SDV,etc) √
Less: expenses of transfer √
NET CONSIDERATION √
Less:
Cost of Acquisition/indexed cost of acquisition √
Cost of Improvement/indexed cost of improvement √
First poviso CAPITAL GAIN IN CASE OF NON-RESIDENT
Applicable when initial investment is made in foreign currency. It is applicable only for share and
debentures.
RULE 115 A : METHOD OF CONVERSION-Telegraphic Transfer Buying / selling Rate
Cost of Acquisition Average of TTBR and TTSR On the date of acquisition

Sale consideration & Exp. Average of TTBR and TTSR On the date of transfer
Capital Gain TTBR On the date of transfer
Note : Not applicable for unit of UTI,MF,BT
Second INDEXATION
Proviso Only of long term capital assets. No indexation for Short term capital assets and Depreciable Assets.
Assets Listed Share , unit of UTI or DOMF, unit of business trust or
EOF, ZCB other
STCA ≤12 months ≤24 months
LTCA >12 months > 24 months
For long term capital assets instead of Cost of Acquisition and Cost of Improvement , indexed cost of
Acquisition and indexed cost of improvement shall be taken.
Shifting base year from 1981 to 2001 for computation of capital gains
ICOA/ICOI= COA/COI*CII of the year in which transfer took place
CII of the year of Acquisition/improvement
Amendment - In case of a capital asset, being land or building or both, the 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.
Third proviso SECOND PROVISIO OF SECTION 48 NOT TO APPLY

Benefit of indexation not available on bond and debenture.
Fifth proviso STT NOT ALLOWED ON TRANSFER OF CAPITAL ASSETS

STT not allowed as expenses on transfer and accordingly neither be reduced from sale consideration
Nor add in Cost of Acquisition.
PTBR: STT allowed when share held as Stock in trade.
55 COST OF ACQUISTION
Includes all cost incurred to acquire the capital assets reduced by that have been made by other
authority.
PTBR: The capital gain is derived after reduction of COA and COI from FVCR. So the capital assets
which are not acquired , automatically generated (eg. Goodwill,Right,etc) then cost of acquisition is
indeterminate then capital gain can’t be calculated and accordingly capital gain will not arise.
So to overcome from this tax planning.
For the following self generated assets cost of acquisition specified.
CAPITAL ASSETS COST OF ACQUISTION
ACQUIRED SELF
GENERATED
9
Goodwill of a business Purchase price NIL

Trade mark or brand name associated with a business Purchase price NIL
Tenancy rights Purchase price NIL
Stage carriage permits(Route Permits) Purchase price NIL
Loom hours Purchase price NIL
Right to manufacture, produce any article or thing Purchase price NIL
Right to carry on any business Purchase price NIL
B.C.SrinivasaSetty(SC) : COA of self generated assets other than those mentioned in section 55, is
indeterminate, Therefore no capital gains shall arise. E.g on sale of spontaneously grown trees,
goodwill of profession.
COST OF IMPROVEMENT
Cost incurred after acquisition.
NIL for Goodwill of business, Right to manufacture, produce or process any article or thing, Right to
carry on any business.
PTBR: Cost of improvement incurred before 01.04.2001 is to be ignored in all cases.
50 D FAIR MARKET VALUE

Fair market value deemed to be Full value of Consideration Received (FVCR) Where consideration
received / receivable from TRANSFER of CAPITAL ASSETS is not Ascertainable.
PTBR :FMV concept Relevant only for 45(1A),45(2),45(4),46(2) and 50(D)
50C SPECIAL PROVISION FOR FULL VALUE OF CONSIDERATION IN CERTAIN CASES
For Capital Assets being land, building or both if FVCR is less than the SDV then SDV to be taken as
FVCR. If SDV exceed FAIR VALUE then Assessing Officer may refer to Valuation Officer. Where values
determined by Valuation officer exceed SDV then SDV should be taken as FVCR.
It is provided that where the stamp duty value does not exceed 110% 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 be deemed to be the full value of the consideration
43CA SPECIAL PROVISION FOR FULL VALUE OF CONSIDERATION IN CERTAIN CASES FOR OTHER THAN
CAPITAL ASSETS
For IMMOVABLE PROPERTY BEING land, building or both held as stock in trade if FVCR is less than the
SDV then SDV to be taken as FVCR. If SDV exceed FAIR VALUE then Assessing Officer may refer to
Valuation Officer. Where values determined by Valuation officer exceed SDV then SDV should be taken
as FVCR.
It is provided that where the stamp duty value does not exceed 110% 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 be deemed to be the full value of the consideration
PTBR : Where Date of Agreement and Date of Registration is not same then option to take SDV as of
Date of agreement, if prior transaction is on Date of Agreement in other than cash.
This option is available to seller who involved in Real estate.
45(2A) TRANSFER OF SECURITIES BY DEPOSITORIES

Follow FIFO method to determine COA and indexed accordingly.
45(3) CAPITAL GAIN ON TRANSFER OF A CAPITAL ASSET BY A PARTNER/ MEMBER TO FIRM/AOP/BOI
Amount recorded in the book is FVCR.
45(4) CAPITAL GAINS ON TRANSFER OF A CAPITAL ASSET BY WAY OF DISTRIBUTION ON DISSOLUTION OF

FIRM/AOP/BOI or otherwise.
The FMV on the date of distribution is FVCR.

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10(37) EXEMPTION IS RESPECT OF CAPITAL GAIN IN CASE OF AGRICULTURAL LAND

If compulsory acquired agricultural land of urban area by government and such land used by individual
HUF, or his family ≥2 year.
10(38) EXEMPTION IN RESPECT OF LONG TERM CAPITAL GAIN IN CASE OF SPECIFIED SECURITIES
When LTCG arise on sale of Equity Share or Unit of Equity oriented Mutual Fund and such Sale should
subject to Security transaction tax(STT). Both listed and unlisted equity share is subject to STT.
Loss will have no tax implication. So no tax treatment for loss.
111A TAX ON SHORT TERM CAPITAL GAIN
When STCG arise on sale of Equity Share or Unit of Equity oriented Mutual Fund and such Sale should
subject to Security transaction tax (STT). Both listed and unlisted equity share is subject to STT, then
such STCG is taxable @ 15%.
PTBR :Otherwise Normal tax rate / 30%/40%/slab rate as the case may be as applicable to assessees.
112 TAX ON LONG TERM CAPITAL GAIN
For all assessees including non-residents, TAX Rate on LTCG is 20%.
However. For non-resident, tax on LTCG on unlisted securities shall be 10% without applying the
first proviso and second proviso to section 48.
Proviso to 112 LTCG ON LISTED SECURITIES(SHARE & DEBENTURE) OR UNIT OR ZCB
TAX Rates is lower of the following:
20% after indexation
10% without indexation
Subject to exemption u/s 10(38) for equity share and unit.
47 CERTAIN TRANSACTION NOT REGARDED AS TRANSFER
.i. Distribution of capital assets on partition of HUF.
.ii. Transfer of capital assets under a GIFT, WILL, IRREVOCABLE TRUST.
.iii. Any transfer in a scheme of AMALGAMATION.

.iv. Transfer of Capital assets by a holding to subsidiary company.
.v. Transfer of Capital assets by a subsidiary to holding company.
.vi. Transfer of share held in an Indian company, by the amalgamating foreign company to the
amalgamated foreign company.
Provided at least 25% of the shareholder of the amalgamating FC continue to remain
shareholder of the amalgamated FC & Such transfer doesn’t attract tax on capital gain in
the country, in which the amalgamating company is incorporated.
.vib. Any transfer in a demerger by demerged company to resulting company, if the resulting
company is an Indian company.
.vic. Any transfer of capital assets being share of Indian company, in a demerger, to the resulting
company if the resulting company is an Indian company.
Provided at least 3/4th in value of the share of the Demerged FC continue to remain
shareholder of the resulting FC & Such transfer doesn’t attract tax on capital gain in the
country, in which the amalgamating company is incorporated.
.vica. Any transfer in a business reorganization, of a capital assets by the predecessor co-
operative bank to the successor co-operative bank.
.vicb. Any transfer by a shareholder, in business reorganization, of a capital asset being a share or
shares held by him in the predecessor co0operative bank if the transfer is made in
consideration of the allotment to him of any share or shares in the successor co-operative
bank.
.vicc. Any transfer in a demerger, of a capital assets, being a share of a foreign company, referred
to in Explanation 5 to clause (i) of sub-section (1) of section 9, which derives, directly or
indirectly, its value substantially from the share or shares of any Indian company, held by

11
the demerged foreign company to the resulting foreign company.

Provided at least 3/4th in value of the share of the Demerged FC continue to remain
shareholder of the resulting FC & Such transfer doesn’t attract tax on capital gain in the
country, in which the amalgamating company is incorporated.
.vid. Any transfer or issue of shares by the resulting company, in a scheme of demerger to the
shareholder of the demerged company if the transfer or issue is made in consideration of
demereger of the undertaking:
.vii. Transfer in a scheme of amalgamation of banking company with a banking institution.
.viib. Any transfer of a capital asset, being a Government Security carrying a periodic payment of interest, made
outside India through an intermediary dealing in settlement of securities, by a non-resident to another non-
resident.
.viii. Any transfer of bond (FCCB/FCEB) or GDR between NR to NR, made outside INDIA.
.xi. Any transfer of a capital assets, being any work of art, archaeological, scientific, or art
collection, book, manuscript, drawing, painting, photograph or print to government or
public museum.
.x. Any transfer by way of conversion of bonds, or debentures or debenture stock or deposit
certificates of a company into the shares or debentures of that company.
.xa. Any transfer by wary conversion of bonds referred to in section 115AC (FCEB) in to share
or debenture of any company.
.xi. Transfer of share by a shareholder in a scheme of amalgamation.
.xii. Any transfer of capital assets being land of sick industrial company.
.xiii. A firm succeeded by a company. Subject to certain condition.
.xiiib Conversion of company in the LLP.Subject to certain condition.
.
.xiv. A sole proprietorship concern succeeded by a company.
.xv. Any transfer in a scheme of lending of any securities
.xvi. Any transfer of capital Assets in the course of Demutualisation or corporatisation of RSE.
.xvii. Any transfer of capital Assets being a membership right held by a member of RSE.
.xvii. Any transfer of a capital asset, being share of a special purpose vehicle to a business trust in exchange of units
allotted by that trust to the transferor.
.xviii. Any transfer of unit of MF under consolidating scheme.
Consolidating scheme- consolidation to two or more scheme of MF in to new scheme.
Any transfer of capital Assets in a transaction of reverse mortgage.
COMMON 49(1): COA & COI –COA and COI of improvement in the hand previous owner who acquire or incurred,
POINT will be COA and COI in the hand of recipient in case of exempted transfer.
49(2AD): Cost of Acquisition of unit obtained under consolidated scheme will be COA of original unit
in consolidating scheme.
2(42A): PERIOD OF HOLDING-Period during which assets held by predecessor will also be considered
for determination of Period of holding for STCG AND LTCG and indexed accordingly.
While determining period of holding of unit obtained under consolidated scheme, Period held before
consolidating scheme will also be included.
72A : Accumulated loss and unabsorbed depreciation: accumulated loss and unabsorbed depreciation
of predecessor will be termed as accumulated loss and unabsorbed depreciation of the previous year
in which transfer took place, Accordingly it will allowed to carry forward for the initial eligible
assessment year.(eg. In case of business loss it will be allowed to c/f for 8AY.)
47A : Withdrawal of exemption : If any of the applicable condition fail to comply.
32 : Depreciation : Depreciation will be allowed to the extent, allowable as if such succession would
have not been place. And such depreciation will be apportioned between predecessor and successor
in the ration of number of days for which assets used by them.
other expenses : Allowable for remaining number of year as if such succession has not taken place.
(Eg. 35,35ABB, 35D, 35ADD, etc)
BAD DEBT :If debtor of predecessor become bad will be allowed to successor. However if bad of
predecessor recovered will not be taxable in the hand of successor.(P.K.KAIMAL)
12
Following is not treated as succession and accordingly on transfer capital gain will be taxable
Proprietorship converted in to firm
Company converted in to firm
47(iii) ANY TRANSFER IN A SCHEME OF AMALGAMATION.

Following condition should be satisfied:
(i) All assets and liability immediately before amalgamation should become of amalgamated
company.
(ii) Share holder holding at least 75% share of amalgamating company should become
shareholder of amalgamated company.
47(iv),47(v) TRANSFER OF CAPITAL ASSETS BY A HOLDING TO SUBSIDIARY COMPANY. OR
TRANSFER OF CAPITAL ASSETS BY A SUBSIDIARY TO HOLDING COMPANY.
Following condition should be satisfied.
(a) The holding company or its nominees hold the entire share capital of the subsidiary company.
(b) The holding company is an Indian company.
Section 47A:WITHDROWL OF EXMPTION.Where at any time before the expiry of 8 year.
(a) Such capital asset is converted into stock in trade by the transferee company. Or
(b) The holding company or its nominees cease to hold the whole of the share capital of the
subsidiary company.
47(vi) TRANSFER OF SHARE HELD IN AN INDIAN COMPANY, BY THE AMALGAMATING FOREIGN COMPANY
TO THE AMALGAMATED FOREIGN COMPANY.
Following condition should be satisfied.
(a) At least 25% of the shareholder of the amalgamating foreign company continue to remain
shareholders of the amalgamated foreign company and
(b) Such transfer does not attract tax on capital gains in the country in which the amalgamating
company is incorporated.
47(x) ANY TRANSFER BY WAY OF CONVERSION OF BONDS, OR DEBENTURES OR DEBENTURE STOCK OR
DEPOSIT CERTIFICATES OF A COMPANY INTO THE SHARES OR DEBENTURES OF THAT COMPANY.
Section 49(2A): The cost of acquisition of share or debenture received on conversion shall be
proportionate cost of original debenture of deposit certificate which is so converted.
PTBR : The holding period of original debenture shall not be considered for new share or debenture
received on debenture.
47(xi) TRANSFER OF SHARE IN A SCHEME OF AMALGAMATION.
(a) The transfer is made in consideration of allotment to him of the shares in the amalgamated
company except where the shareholders itself is the amalgamated company and
(b) The amalgamated company is an Indian company.
Section 49(2) : COA of share in amalgamated company shall be COA of share in amalgamating
company.
47(xii) ANY TRANSFER OF CAPITAL ASSETS BEING LAND OF SICK INDUSTRIAL COMPANY.
(a) The company transfer LAND.(exemption only for land)
(b) The land is transferred during the period beginning from the PY in which company become
sick industrial company and ending with the PY in which entire net worth exceeds or equal to
accumulated loss.
(c) The sick industrial company managed by its workers’ co-operative.
(d) The land is transferred under a scheme prepared and sanctioned by BIFR.
47(xiii) A FIRM SUCCEEDED BY A COMPANY.

(a) All the Assets and liabilities of the firm relating to the business immediately before the
succession become the assets and liabilities of the company;
(b) All the Partner of the firm immediately before the succession become the shareholders of
the company in the same proportion in which their capital account stood in the books of the
13
firm on the date of succession;

(c) The partner of the firm do not receive any consideration or benefit, directly or indirectly,in
any form or manner, other than by way of allotment of shares in the company; and
(d) The aggregate of the shareholding in the company of the partners of the firm is not less than
50% of the total voting power in the company and their shareholding continues to be as such
for a period of 5 year from the date of the succession.
47(xiiib) CONVERSION OF COMPANY IN TO LLP
(a) All the assets and liabilities of the company immediately before the conversion become the
assets and liabilities of the LLP.
(b) All the shareholders of the company immediately before the conversion become the partner
of the LLP and their capital contribution and profit sharing ration in the LLP are in the same
proportion as their shareholding in the company on the date of conversion.
(c) Shareholders do not receive any consideration other than share in profit and capital
contribution in LLP.
(d) The aggregate of the PSR of shareholder of the company in the LLP shall not less than 50% at
any time during the period of 5 year from the date of conversion;
(e) The total sales, turnover or gross receipt should not exceed 60 lakh rupees in any 3 PPY.
(f) No amount is paid, to any partner out of accumulated profit standing as on date of
conversion.
47(xiv) A SOLE PROPRIETORSHIP CONCERN SUCCEEDED BY A COMPANY.
(a) All the assets and liabilities of the sole proprietor concern relating to the business
immediately before the succession becomes the assets and liabilities of the company.
(b) The shareholding of the sole proprietor in the company is not less than 50% of the total
voting power in the company and his shareholding continues to so remain as such for a period
of 5 year from the date of the succession ; and
(c) The sole proprietor does not receive any consideration or benefit directly or indirectly, in any
form or manner , other than by way of allotment of share in the company;
47(xvi) ANY TRANSFER OF CAPITAL ASSETS IN THE COURSE OF DEMUTUALISATION OR CORPORATISATION
OF RSE.
Following condition should be satisfied
(a) All the assets and liabilities of the AOPs or BOIs relating to the business immediately before
the succession become the assets and liabilities of the company;
(b) The corporatization of recognized stock exchange in India is carried out in accordance with a
scheme of demutualization or corporatization which is approved by SEBI.

14
EXEMPTION UNDER THE HEAD OF CAPITAL GAIN

SECTION 54 54B 54D 54G 54GA 54GB 54EC 54F
ASSETS RHP Agric… Land and L/B,P/M L/B,P/M RHP Any Any capital
TRANSFERRED Land of building Or Right Or Right capital assets
urban area thereon thereon Assets other than
RHP
PERIOD OF >36 month > 2 year by 2 Year for NA NA >36 month >36 >36 month
USE assessee industrial month
or their purpose
parent
NEW ASSETS Residential Agric… Residential L/B or P/M L/B or P/M Equity Bond RHP
House Land House share of on of RECL
Property Property eligible or
company NHAL
for
purchase
of new
assets
PERIOD OF Purchase Purchase Within 3 year Within 1 Within 1 If within 1 Sold or Within 1
ACQUISITION with in 1 with in 2 from date of year before year before year equity pledge year
OR year before year for receipt of or after the or after the share or with in before or 2
CONSTRUTION or date of compensation DOT DOT Net assets 3 year year after
construct transfer sold or from the DOT
with in 2 transfer DOA
year from
DOT.
EXEMPTION Cost of Cost of Cost of new Cost of new Cost of new If CONA ≥ Cost of If CONA ≥
new assets new assets assets or CG assets or assets or NC then new NC then
or CG or CG w.i.less CG w.i.less CG w.i.less full other assets full other
w.i.less w.i.less wise or CG wise
proportion w.i.less proportio
DEPOSIT Available Available Available Available Available Available NA Available
SCHEME
(CGAS)
WITHDRAWAL If new RHP If new land If transfer If transfer If transfer If within 1 Sold or (i).If within
OF transferred transferred with in 3 year with in 3 with in 3 year equity pledge 3 year new
EXEMPTION with in 3 with in 3 from DOA year from year from share or with in assets
year from year from DOA DOA new assets 3 year transferred
its DOA sold or from (ii)if within
purchase transferred DOA 2 year
or additional
construct purchased
or within 3
year new
construct
COMPUTING Applicable App App App App NA NA NA
MACHINERY
ASSESSEE Individual Individual All industrial All All Individual All Individual
or HUF or HUF undertaking industrial industrial or HUF or HUF
undertaking undertaking
1. Computing machinery Applicable means cost of acquisition of New assets will be reduced by
exemption withdrawn, rather exemption withdrawn directly taxable in normal case.

15
Chapter-5: PREVENTION AND CIRULATION OF UNACCOUNTED MONEY
SECTION DESCRIPTION AND CONCLUSION

56(2)(vii) Purchase/gift received by individual or HUF.
(coal/exemption/relative define
56(2)(viia) Share received as gift by closely held company(other than widely held company)
56(2)(viib) Received consideration for issue of share at above face value
SECTION ASSESSEE ASSETS GIFTED MODE TAXABLITY ASSESSABLE

VALUE (IFOS)
56(2)(vii) Individual and MONEY Without If >50000 Whole
Property : HUF consideration
immovable (*Here IMMOVABLE With If SDV exceeds SDV-Purchase
Share assessee has PROPERTY consideration Purchase price Price
Jewellery
option to take by more than
Archeological
SDV of as on 50000
collection
Drawing date of Without* If SDV*> 50000 Whole
Painting agreement if consideration
Sculpture initially full or MOVABLE With If Fair value Fair value-
Bullion part PREPERTY (only consideration exceeds Purchase Price
Any other Work consideration ISJADPSAB) Purchase price
of art received in by more than
Not include other than cash 50000
Car,watch etc. as on DOA or Without If Fair value > Whole
prior to DOA. consideration 50000
56(2)(viia) Closely held Share With If Fair market Fair market
company (other consideration value exceeds value-Purchase
than widely Purchase price Price
held, eg.public) by more than
50000
Without If Fair market Whole
consideration value > 50000
56(2)(viib) Closely held Consideration NA Applicable Consideration –

company (other for issue of when issue fair market
than widely share price exceed value
held, eg.public) face value
Note:
It is provided that where the stamp duty value does not exceed 110% 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
be deemed to be the full value of the consideration
(1) Aggregate value of All sum received during previous year from All person should consider while
determining the limit of 50000.

16
(2) Property should be in the nature of capital assets, if it is received in other form then 56(2) (vii) not
applicable. Egg- as sit.
(3) 56(2) (vii) not applicable when property receipt from relative or on the occasion of marriage or on
death.
11
(4) Relative means-
a. spouse of individual,
b. brother and sister of individual
c. brother and sister of spouse of individual or
d. brother and sister of parent of individual,
e. lineal ascendant or descendent of individual
f. lineal ascendant or descendent of spouse of individual
g. spouse of person referred in (b) and (d)
h. HUF and there member
Following are not relative, so if receipt from them it would be taxable.
1. Daughter of elder sister
2. Brother’s mother in law.
Abbreviation used in summary is described as follows:-

PTBR: Point to be remembered
RHP: Residential house property
SDV: Stamp Duty Value
DOA: Date of Acquisition
L :Lacs
K: Thousand
DOA : Date of Acquisition
COA : Cost of Acquisition
HUF : Hindu Undivided Family

17
Chapter-4: PROFIT OR GAIN OF BUSINESS OR PROFESSION
Computation of PGBP Income

Profit and loss as per profit and loss account
Add Expenses debited to profit and loss account but disallowed as per income tax act.
Income not credited to profit and loss a/c but taxable as per Income tax Act or u/h
PGBP
Less Income credited to profit and loss a/c but not taxable as per income tax Act or u/h
PGBP
Expenses not debited to profit and loss a/c but Allowable as per income tax Act.
Profit and loss as per income tax
Section wise categorization

Section Description
28 Chargeability of income
30-37 (1) Admissible expenses
37(2) - 40 Inadmissible expenses (Disallowed)
41-42 tax to recovery, earlier allowed as deduction
43 Deduction allowed only on payment basis
44AA-
44AB Maintenance of account and audit
44AD-
44AE presumptive income in case of carriage vehicle
SECTION CONTENT
28 Taxable income under head of PGBP
29 Computation of profit and loss u/h of PGBP considering section 29 to 43B
Admissible Expenditure
30 Rent, Rates, tax, Repair and insurance of building
31 Repair and insurance of plant and machinery and furniture.
32(1)(ii) Depreciation
32(1)(iia) Additional Depreciation
32AC Investment in New Plant and Machinery
32AD Investment in New Plant and Machinery in Notified Backward Area in Certain cases.
35 Expenditure on Scientific research
35ABB Amortisation of telecom license fee
35AC Expenditure on eligible project Scheme
35AD Deduction of expenditure on specified business
35CCA Contribution to association or institution for carrying out RDP.
35CCC Expenditure on Agricultural extension project
35CCD Expenditure of Skill development project
35DDA Amortisaiton of expenditure on VRS.
35D Preliminary expenses
36 Other deduction as specified
37(1) deduction of other genuine business expenses
Inadmissible expenditure
37(2B) Contribution to political party or amount paid on violation of law

18
40(a)(i) Amount paid to Non-resident without deducting tax

40(a)(ia) Amount paid to resident without deducting tax
40(a)(ii) Payment of income tax
40(a)(iia) Payment of wealth tax
40(a)(iii) Payment made to non-resident as salary without deducing TDS
40(a)(iv) Payment to provident fund without secure that TDS will be deducted there from.
40(a)(v) Payment of taxes in respect of non monetary perquisites.
40(b) Deduction in respect of payment to partner
40(ba) Disallowance applicable to AOP/BOI
40A(3) Expenses not deductible under certain circumstances
Certain taxable income
41 Profit chargeable to tax
41(1) Taxability of Recovery of Expenditure and Remission and cessation of trading liabilities
43A Foreign exchange fluctuation
43B Disallowance of unpaid liability
Actual cost of assets acquire and WDV
43(1) Actual cost of assets
43(6) WDV
Audit and accounts
44AA Compulsory maintenances of accounts
44AB compulsory Audit
Presumptive taxation
44AD Presumptive income of person engage in business other than transport
44AE presumptive income of person engage in business of transport
Certain deduction and exemption
Deduction
under
section 80 It is deducted from gross total income
Exemption
under
section 10 It doesn’t form part of gross total income

19
28 Taxable income under head of PGBP

Memory technique: BPSC DPS PINK
B- Benefit and perquisites arising from business or profession.

P- Profit and gain of any business or profession.
S- Sale of import entitlement license.
C- Cash compensatory support.
D- Duty Drawback.
P- Profit on the transfer of duty entitlement passbook.
S- Self contributories and Self Beneficiary (Trade Association,RWA,Club,etc) , income from Specific Services.
P- Profit on duty free replenishment certificate.
I- Interest, Salary, Bonus, Commission or remuneration received by partner to the extent allowed u/s 40(b).
N- Not Carrying out any activity.
K- Key man insurance policy. -
30 Rent, Rates, tax, Repair and insurance of building

Revenue nature expense is allowed. If it is in the nature of capital then not allowed. Capital expenditure incurred by
tenant deemed as owner for such and depreciation allowed on such capital expenditure.
Expenditure on Advertisement is revenue expenses.
31 Repair and insurance of plant and machinery and furniture.
Revenue nature expense is allowed. If it is in the nature of capital then not allowed.
32(1)(ii) Depreciation
Depreciation allowed to owner, on building, p/m, Furniture, Intangible assets, etc. Irrespective of wholly or partly
used by assesses / wholly or partly owned possession. It is mandatory to claim depreciation, irrespective of assesses
desire to claim or not. Depreciation is Allows on block wise. Separate block for each category of assets, all the assets
falling in a block is chargeable at same rate. Depreciation is allowed on WDV standing on last day previous year.
However, depreciation would be restricted to half if put to use for less than 180 days. Block of assets prepared as
follows:
Particular Block -1 Block -2 Block -3 Block -4 Block -5 Block -6 Block -7
Building F/f, , P/m, Motor Ship Intangible Motor Computer including software,
Book other than annual
for car other than car used publication and Library, Air
residenc used in in Pollution, Water pollution,
solid waste equipment, life
e business business saving medical equipment,
Book
Rate 5% 10% 15% 20% 25% 30% 40%
Opening WDV
Add: Assets Acquired
during year.
Less: Amount Payable
in respect of Assets
sold, discarded,
demolished or
destroyed.
Balance
Depreciation on
Above balance
Closing WDV
APCE: Air Pollution Control Equipment. , WPCE: Water Pollution Control Equipment.
32(1)(iia) Additional Depreciation
20
In case of new plant and machinery acquired and installed for manufacture or production of article or thing or for
generation or generation and distribution of power, additional depreciation @20% of actual cost shall be allowed as
deduction. However, depreciation would be restricted to 10% if put to use for less than 180 days.
Provided that where an assessee, sets up an undertaking or enterprises for manufacture or production of any article
or thing on or after the 1st day of April, 2015 and ending before the 1 st day of April, 2020 in the state of Andhra
Pradesh or Bihar, Telangana or West Bengal, then additional depreciation would be allowed @30%.
No deduction for following:
1. For any Second hand machinery or plant.
2. For any residential accommodation.
3. For office appliance or road transport.
4. For machinery or plant whole of the actual cost of which allowed as deduction.
5. Assessee engages in generation or generation and distribution or electricity, who is claiming depreciation as
per WDV.
32AC Investment in New Plant and Machinery
A company engage in manufacture or production or article or thing, Acquire or install new assets and the amount of
actual cost of such new assets acquired and installed during any previous year exceeds 25 Crore Rupees, then 15%
deduction is allowed, it is addition to Depreciation, and it shall not be reduced from WDV.
32AD Investment in New Plant and Machinery in Notified Backward Area in Certain cases.
Where an assessee, sets up an undertaking or enterprises for manufacture or production of any article or thing on
or after the 1st day of April, 2015 and ending before the 1 st day of April, 2020 in the state of Andhra Pradesh or Bihar,
Telangana or West Bengal, then allowed deduction of 15%. It is addition to Depreciation, and it shall not be reduced
from WDV.
35 Expenditure on Scientific research
Research related to business Research not related to business

35(1)(i) Revenue expenditure 100% 35(1)(ii) Contribution for Scientific 175%
(including salary and material used research
in SR with in 3 year before
commencement of SR)
35(1)(iia) Payment to company for 125% 35(1)(iii) Contribution for social science or 125%
SR with specific direction Statistical research
to use for the business of
assessee.
35(1)(iv) Capital expenditure 100%
incurred in SR with in 3
year before
commencement of
SR(not for land)
35(2AA) IIT, National laboratories, 200%
university
35(2AB) In house scientific 200%
research
35ABB Amortisation of telecom license fee

Amortise over relevant period.
21
Relevant period means Period From commencement of business or date of payment, whichever is earlier till expiry
of license of telecommunication fees.
Treatment on sale of Telecommunication license.
Sale Sale price >Unamortised balance Sale Price <Unamortised balance
In part Profit till depreciation allowed Balance considered as cost allowed
PGBP income, beyond that CG. in remaining period.
In full Balance amount allowed as
deduction in the year of transfer
35AD Deduction of expenditure on specified business

150% or 100% deduction of capital expenditure on specified business or 100% deduction of revenue expenditure of
specified business, incurred before commencement of business.
150% for following:
Memory technique : H2PWC
H- Housing project under affordable housing scheme.
H- Hospital with at least 100 beds facilities.
P- Production of fertilizer.
W- Warehousing facilities.
C- Cold chain facilities for agricultural produce.
35CCA Contribution to association or institution for carrying out RDP.
Allowed even if it in the nature of corporate social responsibilities.
35CCC Expenditure on Agricultural extension project
35CCD Expenditure of Skill development project
Allowed even if it in the nature of corporate social responsibilities.
35DDA Amortisaiton of expenditure on VRS.
Allowed equally over period of 5 year.
35D Preliminary expenses
Allowed equally over period of 5 year.
36 Other deduction as specified

There is certain expenditure which is specifically allowed.
Memories technique : IMBIZEEL BSF
I- Insurance of stock in trade
M- Mediclaim insurance on the health of employee.
B-Bonus or commission paid to employee.
I-Interest on borrowed capital after the assets put to use.
Z-Zero coupon bond (Discount portion over period of ZCB)
E- Employer contribution to pension Scheme/provident fund/Superannuation fund/Gratuity fund.
E- Employees contribution towards Welfare fund.
L- Live Stock – no depreciation allowed, on death or becoming unusable difference between cost and value realised
allowed as terminal depreciation.
B- Bad debt- Actual Bad debt written off as irrecoverable. (Provision for Bad debt not allowed.)
S-Security transaction tax and Commodity transaction tax.
F-Family Planning expenditure (allowed to company assessee in 5 year)
37(1) deduction of other genuine business expenses
Those Expenses are allowed as deduction which is not personal in nature, which is not in the nature of capital & if it
is used exclusively for the purpose of business or profession.

22
Inadmissible expenditure
37(2B) Contribution to political party or amount paid on violation of law

It is not allowed as expenditure but it can be claimed as deduction u/s 80GGB &80GGC.
40(a)(i) Amount paid to Non-resident without deducting tax

It is allowed as deduction if deduct in previous year and paid to government before due date of filing of return u/s
139(1). Such would be allowed in the year of payment or deduction & payment as the case may be.
40(a)(ia) Amount paid to resident without deducting tax

It is allowed as deduction if deduct in previous year and paid to government before due date of filing of return u/s
139(1), failure to which disallowance will be restricted to 30% and such would be allowed in the year of payment or
deduction & payment as the case may be.
40(a)(ii) Payment of income tax

40(a)(iia) Payment of wealth tax
It is not allowed as deduction if debited to profit and loss a/c then add back.
40(a)(iii) Payment made to non-resident as salary without deducing TDS
40(a)(iv) Payment to provident fund without secure that TDS will be deducted there from.
Employer’s contribution towards provident fund or any other fund not allowed as deduction if it is not ensured that
TDS will be deducted there from at maturity.
40(a)(v) Payment of taxes in respect of non monetary perquisites.

Payment of tax on behalf of employee on non-monetary perquisites is not allowed as deduction. It is not taxable in
the hand of employee since such is exempted u/s 10(10CC)
40(b) Deduction in respect of payment to partner

Salary, commission, bonus and remuneration allowed if it is paid to working partner. Payment of Interest to working
as well as non-working partner allowed as deduction.
However maximum remuneration to working partner will be restricted to following.
PGBP income before remuneration Amount of remuneration

On first 300000 150000 or 90% of remuneration whichever is higher
beyond 300000 60% of remuneration
40(ba) Disallowance applicable to AOP/BOI

Salary, commission, bonus and remuneration paid to member not allowed as deduction. However, interest paid to
its member and receipt from its member, then net to be disallowed. Interest paid to member in representative
capacity (HUF, karta) allowed if member in individual capacity. Interest paid to member in individual capacity
allowed if member in representative (HUF, karta) capacity.
40A(3) Expenses not deductible under certain circumstances

23
When payment is made in cash in excess of 10000/35000 to a person in a day by otherwise account payee cheque or
account payee demand draft. However, no disallowance will be made in case of certain specified unavoidable
circumstance (bank holiday, Bank strike, etc).
Certain taxable income
41(1) Recovery of expenditure & remission and cessation of trading liabilities

Recovery of expenditure, which was earlier allowed as deduction, is taxable as business income. Eg. Recovery of bad
debt is taxable to the extent of earlier allowed as deduction.
Remission or cessation of trading liabilities in respect of which earlier allowed deduction, taxable as business income.
Even by unilateral act trading liability cease to exist, deemed to business income.
Time barred liability written off is taxable as business income. However time barred liabilities not written of is not
taxable.
Trading liabilities includes trade deposit, working capital loan, cash credit, etc.
Waiver of unpaid Interest on term loan is not taxable since it was not earlier allowed as deduction.
43A Foreign exchange fluctuation
Capital assets: where any capital assets acquired on suppliers credit or loan in foreign currency, then, affect of
changes in foreign currency should be recognised in cost of assets only in the year of payment.
Depreciable assets: where any capital assets acquired on suppliers credit or loan in foreign currency, then, affect of
changes in foreign currency should be recognised in cost of assets only in the year of payment.
Stock in trade: WOODWARD GOVERRNOR INDIA(P) LTD.
If an assessee coverts the outstanding liability related to the import of raw materials using the closing rate of
exchange of exchange as on last day of previous year (31 stmarch ) and such conversion result in loss, then such is
allowable under section 37(1).
That is allowed to recognise on accrual basis rather than payment basis.
43B Disallowance of unpaid liability
Following are certain expenditure in respect of which deduction allowed only on payment basis.
Memory technique: BITEL
B- Bonus or commission payable to employee.
I- Interest payable on any loan or borrowing./ Insurance payment
T-tax, due or cess.
E- Employer contribution to retirement fund.
L- Leave encashment.
Actual cost of assets acquire and WDV
43(1) Actual cost of assets
Actual cost of assets means cost of acquisition including other cost incurred to bring the assets at current location
and make them worthy to put to use, reduced by that have been met directly or indirectly by any other authority.
44AB Audit
•Business - exceeds Rs. 1 Crore

•Profession- exceeds Rs. 50 L
• Presumptive Taxation 44AD – Sales > 2 Crore.
•Business u/s 44AE /44BB /44BBB; income < deemed profits;
•Profession u/s 44ADA; deemed profit < 50% & If the Income > Maximum Amount not chargeable to tax.
Amendment The threshold limit of Rs 1 crore for a tax audit is increased to Rs 5 crore subject to both condition
simultaneously satisfying : -

24
if the taxpayer’s cash receipts are limited to 5% of the gross receipts or turnover, and
if the taxpayer’s cash payments are limited to 5% of the aggregate payments.
Presumptive taxation
44AD Presumptive income of person engage in business other than transport
Applicable to sole proprietor, individual, HUF and firm carrying any business having a gross turnover not exceeding
rupees 200 LACS. Deduction for expenses will not be allowed, deduction under section 30 to 38 deemed to have
been allowed.
However, deduction under section 40(b) would be available to firm. (From AY 17-18 it is presumed that the Partners
Remuneration and Interest have already been deducted before calculating the Deemed Profit.)
(i) FOR SMALL BUSINESSES (Section 44 AD)
Turnover upto Rs. 200 Lakhs
Deemed Profit –
a) 6% of Gross Receipts received by an account payee cheque or account payee bank draft or use of electronic clearing
system through a bank account during the previous year orfore the due date specified in sub-section (1) of section 139
in respect of that previous year;
b) 8% of Gross Receipts other than those covered in para (a) above.
(ii) FOR SMALL PROFESSIONAL (Section 44 ADA)

Gross Receipt upto Rs. 50 Lakhs
Deemed Profit – 50% of Gross Receipts
44AE presumptive income of person engage in business of transport

For assesses engage in the business of plying, hiring, leasing goods carriage vehicle not owing exceeding 10 goods
carriage vehicle.
Presumptive rate of income is rupees 7500 per month per vehicles.
Amendment as per the Finance Bill 2018

For the financial year, 2018 – 2019, the following provision for the calculation of taxable income under section 44AE
shall be applicable.
 For light goods vehicle (less than the gross weight of 12MT) Rs. 7,500 per vehicle per month (part shall be
considered full month).
 For heavy goods vehicle (more than 12 MT gross weight) – Rs. One thousand per tonne per vehicle per
month (part will be considered full month).
Calculation of Presumptive Income for Partnership Firm

The income calculated under section 44AE is estimated and considered to be the net income of the assessee and no
deduction shall be granted.
However, where the assessee is a partnership firm, the remuneration or interest paid to partners can be claimed as a
deduction under section 40(b). In other words, separate deduction from the above calculated presumptive income
can be claimed as a deduction.

25
Chapter-5: DEDUCTION
Deduction
under
section 80 It is deducted from gross total income
Section Content
80C Life insurance premium, deferred annuity contribution to provident fund, subscription to certain
shares or debentures, investment in bond of NABARD, investment in five year post office deposit,
tuition fees of school or college, repayment of loan taken for construction of residential house
property, etc. Maximum restricted to 150000
80CCC Maximum deduction restricted to 150000 on account of contribution to a pension fund of LIC or
IRDA approved insurer.
80CCD(1 Contribution to new pension scheme up to 10% of salary or gross total income for salaried person
) or self employed respectively. Maximum restricted to 150000
80CCE 80C+80CCC+80CCD(1)=150000
80CCG Rajiv Gandhi equity saving scheme: for new retail investor having GTI not exceeding 12 lacks,
entitle to rebate of 50% of amount of investment in equity share or unit of equity oriented mutual
fund or 25000 whichever is less.
80D Specified decease. Deduction for senior citizen 30000 and for other than senior citizen 25000
rupees.
Scenario Premium paid Deduction under
80D
Self, family, Parent
children s
Individual and parents below 60 years 25,000 25,000 50,000
Individual and family below 60 years but 25,000 50,000 75,000

parents above 60 years
Both individual, family and parents above 50,000 50,000 1,00,000

60 years
80DD Disability if ≥80% then deduction is 125000 & if <80% then deduction is 75000.
80DDB Expenditure for medical treatment of decease: deduction for senior citizen is 1,00,000 and for
other 40000.
80E Interest of loan taken for education
80EE Rs. 50000/-
Interest on loan taken for construction of RHP provident loan amount not exceeding 25 lacs, value
of house doesn’t exceed 40 lacs and assess should not have any other RHP.
80G Donation to fund, trust for charitable purpose that is approved u/s 80G. Eg- PMNRF,
If amount exceed 10000 then only account payee cheque or account payee bank draft.
80 GG For Rent Paid
Lower of Following:
1. Rs. 5000 p.m. (60,000.00 per annum)
2. 25% of Total Income;
3. Rent Paid – 10% of Total Income
80GGA Donation to scientific research association or social and statistical research association.
If amount exceed 2000 then only account payee cheque or account payee bank draft.
80GGB Contribution to political party or electrol trust by company.
80GGC Contribution to political party or electrol trust by individual.
80JJAA 30% of additional wages paid to new regular workmen by company. New regular workmen doesn’t
include casual employee. The threshold of minimum workmen has been reduced from 100 to 50.
80P Deduction available to Co-operative society: 100% of profit included in GTI.
Memory technique(1) ABCDF (2),(3) &(4) + GENRAL DEDUCITION OF 100000 OR 50000.
(1) ABCDF

26
(i) (a) Agriculture-Purchase of agricultural implements, seed, livestock for agriculture

(b) Agriculture-processing of agricultural produced without the aid of power.
(c) Agriculture- Marketing of agricultural produce.
(ii) B- Business of providing credit facilities.
(iii) C-Cottage industry.
(iv) D-Disposal of labour.
(v) F-Fishing or allied activity.
(2)100% of profit to primary society engage in supplying milk, oilseeds, fruits or vegetable raised or
grown by its member.
(3) 100% of profit consists of interest or dividends income from investment in other co-operative
society.
(4) 100% of profit from letting of godowns or warehouse.
+
Consumer’s co-operative society-100000
Other than consumer’s co-operative society-50000
80TTA Interest received in saving account maximum deduction restricted 10000 rupees.
80U It is proposed to increase the limit of deduction u/s 80U of the Income-tax Act in case of a person
with disability, from ` 50,000 to ` 75,000. It is also proposed to increase the limit of deduction
from ` 1 lakh to `1.25.

27
Chapter-6: EXEMPTION
Exemption
under
section 10 It doesn’t form part of gross total income
Section Content
10(1) Agricultural income
10(2A) Share of the partner in total income of partnership firm
10(7) Allowance or perquisites paid by government to its employee outside india.
10(10CC) Tax paid on perquisites but its employer exempt in the hand of employee.
10(10D) Any sum received under life insurance policy including bonus.
10(23D) Income of mutual fund
10(23DA) Income of securitisation trust from activity of securitisation
10(23FB) Income of VCC/VCF from investment in VCC.
10(23FC) Interest income received by business trust form SPV.
10(23FD) Income received by unit holder of business trust from BT except portion of income consisting of
interest income exempted u/s 10(23FC)
10(34) Dividend received by share holder.
10(34A) Consideration received by holder of securities on buy back of unlisted equity share.
10(35) Dividend interest received by united holder of MF form MF.
10(35A)
10(37) Capital gain on compulsory acquisition of agricultural land of urban area by government.
10(38) Long term capital gain on sale of share & unit of equity oriented mutual fund
10(43) Amount received under reverse mortgage.
10(44) Income received by NPS Trust
10(48) Income received in Indian currency by foreign company for supplies of crued oil and other as
specified by central government.

28
Chapter - 7. Tax Deduction at Sources (TDS)
Summary all the TDS Provisions for F.Y 2020-21

(AY 2021-22)
TDS Nature of Payer Payee Rate of TDS Exemption Limit (No
UNDER Payment (Deductor) (Deductee) TDS to be Deducted
SECTIO upto threshold limit
N mentioned)
TDS on Salary Any Person Employee(R Applicable In old regime - Basic GTI
or NR) Average exemption limit of
Income Tax Rs.250000 (Ind) or
Slab Rates Rs.300000 (SC) or
192
Rs.500000 (SSC) as the
case may be.
In new Regime -
5,00,000.00
TDS on Any Person Employee 10% (If no PAN Amount is less than
Premature then MMR i.e. Rs.50000
Withdrawal 35.535%)
192A
from
Provident
Fund
TDS on Any Person Any 10% Upto Rs.5000 in a
Interest on Resident financial year (FY) for
193
Securities Person Individual/HUF in the
case of Debentures.
TDS on Domestic Resident 10% Upto Rs.2500 in a FY
Dividends Company Person (for Individual)
other than
194
devidend as
refered in
section 115-O
TDS on Any Resident 10% Up to Rs.10,000 (for
Interest Person(Other Person payments made by
(Other than than banks, cooperative
Interest on Individual/HU banks or on post office
Securities) F not liable to deposits) and up to
194A
tax audit in Rs.5000 (for other
last PY) cases). [In case of a
senior citizen, the limit
is Rs. 50,000 w.e.f.
1.4.2018]
Amendment- a co- operative society shall be liable to deduct TDS u/s 194A, if-
a) total sales, gross receipts exceed Rs.50 crores during the financial year immediately
29
preceding ; and
b) aggregate amount of such interest is more than Rs. 50,000 in case of payee being a
senior citizen and Rs. 40,000 in any other case.
TDS on Any Person Any Person 30% Up to Rs.10000
Winnings from
194B Lottery or
Crossword
Puzzles
TDS on Any Person Any Person 30% Up to Rs.10000
194BB Winnings from
Race Horses
TDS on Any Any 1% (for Up to Rs.30000 for
Payment to Person(Other Resident Individual/HUF) individual payment.
Contractors than Person
Individual/HU 2% (other Up to Rs.100000 for
F not liable to person) total amount during a
tax audit in FY.
194C last PY) Payment to a contractor
in course of business
where he declares
through a PAN that he
owns 10 or less good
carriages during the
year.
TDS on Insurance Resident 5% (for Up to Rs.15000 during
Insurance Company Agent Individual/HUF) FY
194D Commission
10% (other
person)
TDS on Any Person Any 1% Less than Rs.100000
Payment in Resident
194DA Respect of Life Person
Insurance
Policy
TDS on Any Person NR- 20% No exemption limit.
Payments to -Sportsmen
Non-Resident -Sports
194E
Sportsmen or Association
Sports -Entertainer
Association
TDS on Any Person Any Person 10% Upto Rs.2500
Payment for
194EE
Deposit Under
NSS
Section 194F: Any Person Any Person 20% No exemption limit.
Payment on
194F account of
repurchase of
unit by Mutual
30
Fund or Unit
Trust of India
TDS on Any Person Any Person 5% Upto Rs.15000
Commission
194G
on Sale of
Lottery Tickets
TDS on Any Any 5% Up to Rs.15000
Commission or Person(Other Resident
Brokerage than Person
194H Individual/HU
F not liable to
tax audit in
last PY)
TDS on Rent Any Any 2% (on rent Up to Rs.240000 during
Person(Other Resident paid for use of the FY
than Person machinery,
Individual/HU plant or
194I F not liable to equipment)
tax audit in 10% (land and
last PY) building,
furniture and
fixture)
TDS on Any Person Any 1% Less than Rs.50,00,000
Payment on (Other than Resident
Transfer of person Person
Immovable referred to in
194IA
Property (Not section-194LA)
Being an
Agricultural
Land)
TDS on Individual & Any 5% Upto Rs.50000 per
Payment of HUF(Other Resident month
Rent by than covered Person
194IB
Certain u/s 194 I)
Individuals or
HUF
TDS on Any Person Any 10% No exemption limit
Payment Resident
194 IC Made Under Person
Specified
Agreement
TDS on Fees Any Any 10% Up to Rs.30000 during
for Person(Other Resident 2% (in case of FY (the separate limit
Professional or than Person Professional for each kind of
194J Technical Individual/HU fees for payment)
Services F not liable to technical
tax audit in services).
last PY)
194LA TDS on Any Person Any 10% Upto Rs. 2,50,000
31
Payment of Resident
Compensation Person
on Acquisition
of Certain
Immovable
Property
TDS on Infrastructure NR or 5% No exemption limit
Income by Debt Fund Foreign Co.
way of
194LB
Interest from
Infrastructure
Debt Fund
TDS on Certain Business Trust Unit Holder 10% (for No exemption limit
Income from being resident)
194LBA Units of a Resident or 5% ( for non-
Business Trust Non resident).
resident
TDS on Investment Unit Holder 10% (for No exemption limit
Income in Fund being resident)
Respect of Resident or For non-
Units of Non resident person
194LBB Investment resident the tax rate will
Fund be as per the
rates in force
during FY.
TDS on Securitisation Investor 25%(for No exemption limit

Income in Trust being individual or
Respect of Resident or HUF) or 30%
194LBC
Investment in Non (for any other
Securitisation resident person)
Trust
TDS on Specified Non- 5% No exemption limit
Income by Indian resident
way of company or
194LC
Interest from Business Trust
Indian
Company
TDS on Any Person Foreign 5% No exemption limit
Income by Institutional
way of Investor or
Interest on Qualified
194LD
Certain Bonds Foreign
and Investor
Government
Securities
Payment of Individual & Any Person 5% up to Rs. - 50,00,000.00
194M Commission, HUF
brokerage,
32
contractual
fee,
professional
fee to a
resident
person by an
Individual or a
HUF who are
not liable to
deduct TDS
under section
194C,194H, or
194J.
Cash Any bank Any Person 2% 1,00,00,000.00
withdrawal in (private or (Provided who had not
excess of Rs. 1 public sector) filed return for all AY 3
crore during A co-operative year limit would be
the previous bank 20,00,000 and on
year from one A post office exceeding 20,00,000.00
or more up to 1,00,00,000.00
account Rate would be 2%)
maintained by 5% For assess who had not
194N
a person with filed any return for last
a banking 3 ASSESSMENT YEAR,
company, co- on excess of
operative 1,00,00,000.00
society
engaged in
business of
banking or a
post office.
Applicable for E-Commerce E- 1% 5,00,000
Ecommerce Operator Commerce (5% in case of (No any exemption who
operator for Participant NO PAN under doen't provide PAN)
sale of goods section 206AA)
or provision of
service
194O
facilitated by
it through its
digital or
electronic
facility or
platform.
195 TDS on Other Any Person NR or Rate as No exemption limit
Payments Foreign specified in Act
Made to NR Company or DTAA
(Not
Company) or
Foreign
33
Company
Income from
196B units 10%
Income from
foreign
currency
bonds or
shares of
Indian
196C company 10%
Income of
Foreign
Institutional
Investors from
196D securities 20%
Tax Deducted at Sources require to deducted at the time of payment and deposit tds in government
account by 7th of the subsequent month through ITNS-281 Challan . TDS Deductor is require to file TDS return.
TDS deductor is require to issue TDS certificate to DEDUCTEE.
Deductor
Any person making specified payments mentioned under the Income Tax Act are required to deduct TDS at the time
of making such specified payment. But no TDS has to deducted if the person making the payment is an individual or
HUF whose books are not required to be audited.
However, in case of rent payments made by individuals and HUF exceeding Rs 50,000 per month, are required to
deduct TDS @ 5% even if the individual or HUF is not liable for a tax audit. Also, such Individuals and HUF liable to
deduct TDS @ 5% need not apply for TAN.
TDS RETURN
Form No Transactions reported in the return Due date

Form 26Q TDS on all payments except salaries Q1 – 31st July
Q2 – 31st October
Q3 – 31st January
Q4 – 31st May
Form 24Q TDS on Salary Q1 – 31st July
Q2 – 31st October
Q3 – 31st January
Q4 – 31st May
Form 27Q TDS on all payments made to non-residents except Q1 – 31st July
salaries Q2 – 31st October
Q3 – 31st January
Q4 – 31st May
Form 26QB TDS on sale of property With in 30 days of subsequent
month.
Form 26QC TDS on rent With in 30 days of subsequent
month.
TDS Certificate

34
TDS Certificates required to issue in following for different types of deductee.
Form Certificate of Frequency Due date

Form 16 TDS on salary payment Yearly 31st May
Form 16 A TDS on non-salary Quarterly 15 days from due date of filing
payments return
Form 16 B TDS on sale of property Every 15 days from due date of filing
transaction return
Form 16 C TDS on rent Every 15 days from due date of filing
transaction return
Interest on non-deduction/ non-payment of TDS:

As per Sec. 201(1A) of the Income-tax Act, 1961, if the Assessee does not deduct the whole or any part of the TDS or
after deduction fails to pay the TDS as required by or under the Act, then the Assessee is liable to pay simple interest
on the amount of such TDS, for every month or part of a month, at the rate of:
- 1% from the date on which such TDS was deductible up to the date on which such TDS is deducted; and
- 1.5% from the date on which such TDS was deducted up to the date on which such TDS is paid
Late filing Levy:
As per Sec 234E of Income tax Act 1961, where a person fails to deliver or cause to be delivered a statement within
the time prescribed in sub-section (3) of section 200 or the proviso to sub-section (3) of section 206C, he shall be
liable to pay, by way of fee, a sum of Rs 200 for every day during which the failure continues, maximum to the
amount of tax deducted.
In respect of TDS u/s 194IA

i) A challan-cum-statement in Form No.26QB is to be filed within 30 days from the end of the month in which the
deduction is made
ii) TDS certificate in Form no.16B is to be issued to the payee within 15 days from due date of furnishing statement in
Form no. 26QB
In respect of TDS u/s 194IB

a) In respect of any other TDS (other than TDS u/s. 194-IA):
i) A challan-cum-statement in Form No.26QC is to be filed within 30 days from the end of the month in which the
deduction is made
ii) TDS certificate in Form no.16C is to be issued to the payee within 15 days from due date of furnishing statement in
Form no. 26QC
IN CASE OF NO PAN PROVIDED BY DEDUCTEE

Section 206AA:- Below are the applicable TDS rates when the deductee has provided its PAN number to the
deductor. In case PAN of deductee is not updated, the deductor must deduct TDS at higher of the following rates:
a) the rate as prescribed in the Act;
b) at the rate mentioned din the Finance Act; or
c) at the rate of 20%.
* SHEC shall be added on the TDS on all Income for Non Resident.
* SHEC shall be added on the TDS on salary only for Resident NR.
Section 206A:- Electronic Filing of statement of transaction on which tax has been deducted
Any banking co. or Cooperative society paying resident income > 40000 by way of income shall prepare such
Statement Penalty Rs. 100 for each day.
Section 197:- Certificate for No/Lower deduction of TDS.

35
Section 271H:- Penalty for incorrect information or failure to furnish statement Rs. 10,000 to Rs. 1,00,000.
Penalty is mandatory and cannot be waived.
No penalty if filed Quarterly Return before expiry of 1 year from the time prescribed for filing the quarterly return.

36
8. Tax Collection at Sources (TCS)

Section Types of Goods Rate
206C Liquor of alcoliolicnature,madeforconsumptionby humans 1%
Timber wood under a forest leased or by any other mode 2.50%
Tendu leaves 5%
A forest produce other than Tendu leaves and timber 2.50%
Scrap 1%
Minerals like lignite, coal and iron ore 1%
Purchase of Motor vehicle exceeding Rs. 10 Lakh, 1%
Parking lot, Toll Plaza and Mining and Quarrying 2%
Every person, being a seller, who receives any amount as consideration for sale
of a motor vehicle of the value exceeding Rs.10,00,000 (Each sales not sale in
FY), shall, at the time of receipt of such amount, collect from the buyer, a sum
equal to 1% of the sale consideration as income-tax
206C (1F) 1%
Every tour operator on tour package for foreign tour (Outside
India) AND
An authorised dealer receiving money for remittance outside india
under libralised Remittance Scheme.
will collect TCS of 5% on sum received in excess of 7,00,000 (In a

financial year).
If sum exceed 7,00,000 in a financial year.
5%
Provided
206C (1G) If payment is out of loan taken for education purpose(u/s 80E) 1.50%
Seller who receive for sale of any goods of the value or aggregate of
such value exceeding Rs. - 50,00,000.00 in any previous year,
other than export, at the time of receipt of such amount, collect
from the buyer, a sum equal to 0.1 per cent. of the sale
consideration exceeding fifty lakh rupees as income-tax:
206C (1H) In case of NO PAN u/s 206CC @1% 0.1%
206CC TCS Rates without PAN:- Double of TCS rate as above or 5%, whichever is higher
Not apply to NR who do not have Permanent Establishment in India.
206CC TCS Rates without PAN:- Double of TCS rate as above or 5%, whichever is higher
Not apply to NR who do not have Permanent Establishment in India.
A. The seller deposits the TCS amount in Challan 281 within 7 days from the last day of the month in which the tax
was collected.
B. Note: If the tax collector responsible for collecting the tax and depositing the same to the government does not
collect the tax or after collecting doesn’t pay it to the government as per above due dates, then he will be liable to pay
interest of 1% per month or a part of the month
C. Every tax collector has to submit quarterly TCS return i.e in Form 27EQ in respect of the tax collected by him in a
particular quarter. The interest on delay in payment of TCS to the government should be paid before filing of the return

37
TCS Payment and return

Collection Quarter Ending Due date of Payment Due Date of filing return
Month
April 30th June 7th May 15th July
May 7th June
June 7th July
July 30th September 7th August 15th October
August 7th September
September 7th October
October 31st December 7th November 15th January
November 7th December
December 7th January
January 31st March 7th February 15th May
February 7th March
March 7th April
TCS CERTIFICATE
This certificate has to be issued within 15 days from the date of filing TCS quarterly
returns. The due dates are:
Quarter Ending Date for generating Form 27D
For the quarter ending on 30th June 30th July
For the quarter ending on 30th September 30th October
For the quarter ending on 31st December 30th January
For the quarter ending on 31st March 30th May

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FOR

This book is under process ALL other chapter of ca final will be

Chapter – 1: TAX RATES

TAX RATES, SURCHARGE AND MARGINAL RELEIF

All other Domestic Company 30%

Optional Alternative Provision Without claiming deduction for

For an individual or a Provided

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(ii) without set off of any loss,—

Conditional & Optional – Once opted can’t be subsequently Withdrawn.

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15% (Section – 115BAB) natural gas or both in India

For Co-operative Society Subject to following condition

22 % 1. Such society should not avail any exemptions/incentives under

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section 115BAA on or before the due date of filing income tax

DOMESTIC (TAX ON 1 CRORE )+(TOTAL INCOME – 1 CRORE)

FOREIGN COMPONY (TAX ON 1 CRORE )+(TOTAL INCOME – 1 CRORE)

IF THE TOTAL INCOME EXCEED 10 CRORE

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Recent important Amendment

Cash withdrawal limit from bank

Tax Collection at Source

Section Types of Goods Rate

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If sum exceed 7,00,000 in a financial year.

1. Provision for determination of resident status for NRI has changed;

6. Cash donation limit under section 80GGA restricted to ₹ 2000/- only;

7. TDS shall be deducted @ 10 on the payment of divided instead of DDT;

8. TDS shall be deducted @ 2% on payment made for FTS and Royalty;

9. Definition of work contract has amended under section 194C;

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Chapter -4: CAPITAL GAIN

SECTION DESCRIPTION AND GIST

45(2) CONVERSION OF CAPITAL ASSETS IN TO STOK IN TRADE

48 METHOD OF COMPUTATION OF CAPITAL GAIN

Cost of Acquisition Average of TTBR and TTSR On the date of acquisition

Third proviso SECOND PROVISIO OF SECTION 48 NOT TO APPLY

Fifth proviso STT NOT ALLOWED ON TRANSFER OF CAPITAL ASSETS

Goodwill of a business Purchase price NIL

50 D FAIR MARKET VALUE

45(2A) TRANSFER OF SECURITIES BY DEPOSITORIES

45(4) CAPITAL GAINS ON TRANSFER OF A CAPITAL ASSET BY WAY OF DISTRIBUTION ON DISSOLUTION OF

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10(37) EXEMPTION IS RESPECT OF CAPITAL GAIN IN CASE OF AGRICULTURAL LAND

.iii. Any transfer in a scheme of AMALGAMATION.

.v. Transfer of Capital assets by a subsidiary to holding company.

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the demerged foreign company to the resulting foreign company.

47(iii) ANY TRANSFER IN A SCHEME OF AMALGAMATION.

47(xiii) A FIRM SUCCEEDED BY A COMPANY.

firm on the date of succession;

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EXEMPTION UNDER THE HEAD OF CAPITAL GAIN

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Chapter-5: PREVENTION AND CIRULATION OF UNACCOUNTED MONEY

SECTION DESCRIPTION AND CONCLUSION

SECTION ASSESSEE ASSETS GIFTED MODE TAXABLITY ASSESSABLE

56(2)(viib) Closely held Consideration NA Applicable Consideration –

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Abbreviation used in summary is described as follows:-

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Chapter-4: PROFIT OR GAIN OF BUSINESS OR PROFESSION