1. I.T. Forms notified for A.Y. 2008-09

S.O. 752(E) dated 28-3-2008

Central Board of Direct Taxes has issued a notification for prescribing the I.T. Returns for A.Y. 2008-09 by amending the I.T. Rules called Income Tax (Sixth Amendment) Rules-2008. They shall come into force on the 1st April, 2008.

1. in rule 12,

1. in sub-rule (1), for the words, figures and letters “on the 1st day of April, 2007 or any subsequent assessment year”, the words, figures and letters “on the 1st day of April, 2008” shall be substituted;
    

2. in sub-rule (5), for the words, figures and letters “on the 1st day of April, 2006”, the words, figures and letters “on the 1st day of April, 2007” shall be substituted.

2. in Appendix-II, for Form ITR-1, Form ITR-2, Form ITR-3, Form ITR-4, Form ITR-5, Form ITR-6, Form ITR-7 and Form ITR-8, the forms shall be substituted.

2. Issue of Foreign Currency Exchangeable Bond Scheme, 2008 – Notification u/s. 115AC

Notification No. S.O. 386(E), dated 21st February, 2008

In exercise of the powers conferred by sub-section (1) of section 115AC of the Income- tax Act, 1961 (43 of 1961), the Central Government specifies the “Issue of Foreign Currency Exchangeable Bonds Scheme, 2008” notified vide notification number G.S.R. No. 89(E), dated the 15th February, 2008, of the Government of India, Ministry of Finance, Department of Economic. Affairs, as a scheme for the purposes of the said section in respect of the assessment year 2008-09 and subsequent assessment year.

[Notification No. 28/2008/F.No.149/193/2007-TPL]

3. Method for determining amount of expenditure in relation to income not includible in total income

Notification No. 45/2008, dated 24th March, 2008.

In exercise of the powers conferred by section 295 of the Income Tax read with sub-section (2) of section 14A of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income Tax Rules, 1962, namely :–

1. (1) These rules may be called the Income Tax (Fifth Amendment) Rules, 2008.
   (2) They shall come into force from the date of their publication in the Official Gazette.

2. In the Income Tax Rules, 1962, after rule 8C, the following rule 8D shall be inserted, namely :–

“Method for determining amount of expenditure in relation to income not includible in total income.

1. Where the Assessing Officer, having regard to the accounts of the assessee of a previous year, is not satisfied with –

1. the correctness of the claim of expenditure made by the assessee or

2. the claim made by the assessee that no expenditure has been incurred, in relation to income which does not form part of the total income under the Act for such previous yuear, he shall determine the amount of expenditure in relation to such income in accordance with the provisions of sub-rule (2).

2. The expenditure in relation to income which does not form part of the total income shall be the aggregate of following amounts, namely:–

1. the amount of expenditure directly relating to income which does not form part of total income;

2. in a case where the assessee has incurred expenditure by way of interest during the previous year which is not directly attributable to any particular income or receipt, an amount computed in accordance with the following formula, namely:

A x B

     C

Where A = amount of expenditure by way of interest other than the amount of interest included in clause (i) incurred during the previous year;

B = the average of value of investment, income from which does not or shall not form part of the total income, as appearing in the balance sheet of the assessee, on the first day and the last day of the previous year;

C = the average of total assets as appearing in the balance sheet of the assessee, on the first day and the last day of the previous year;

3. an amount equal to one-half per cent of the average of the value of investment, income from which does not or shall not form part of the total income, as appearing in the balance sheet of the assessee, on the first day and the last day of the previous year."

3. For the purposes of this rule, the ‘total assets’ shall mean, total assets as appearing in the balance sheet excluding the increase on account of revaluation of assets but including the decrease on account of revaluation of assets.

F. No. 134/09/2007-TPL.

(Sambit Tripathy)
Under Secy.

Note : The principal rules were published vide notification number S.O. 969(E), published in the Gazette of India, Part-II, Section 3, Sub-section (ii) dated the 26th March, 1962 and last amended by Income-tax (Fourth Amendment) Rules, 2008 vide Notification No. S.O.493(E) dated 13th March, 2008.

Press Release & News :

1. Direct Tax mop-up to scale 3.051 cr

The Government has something to cheer about on the tax collection front. With the growth momentum in corporate and personal tax collections continuing, direct tax collections look all set to exceed the revised target of Rs. 3,05,000/- crore as compared to earlier estimate of Rs. 2,67,490 crores for 2007-08 in the Budget. Direct tax collections have already crossed the Rs. 3,00,000/- crore mark for the first time.

The internal target is now to collect anywhere between Rs. 3,10,000 crore and Rs. 3,20,000 crore” a source said.

The final figures will be available by April end.

2. Co deposits, PO savings may require flashing PAN

Permanent Account Number (PAN) in more financial instruments such as fixed deposits of companies or National Savings Certificates. The Finance Ministry is examining various financial instruments where quoting PAN can be made mandatory. Finance Minister declared that the fear of the PAN has virtually disappeared. PAN is now the sole identification number for all participants in the securities market.

3. Clarification regarding amendment for Penalty in case of concealment of income

Retrospective amendment to section 271 by Finance Bill, 2008: Assessing Officer to record his satisfaction before levying penalty.

In view of the apprehension raised on the retrospective amendment to section 271 of the Income-tax Act, proposed in the Finance Bill, 2008, empowering the Assessing Officer to inter alia, levy penalty in case of concealment of income, the Ministry of Finance has issued the clarification to justify the amendment in the the Finance Bill, 2008 for insertion of new sub-section (1B) in section 271 of Income- tax Act and to further justify the retrospective effect as to protect the Revenues contention on this issue in pending cases.

Source – P I B Press Release, New Delhi dt. 14th March 2008.

[Refer for details – ITR 299 Page 3 (St)]