1. Guidelines for approval u/ss. 10(23C)(vi) and (via) – Rule 2CA

Amended sub-rule (3) to Rule 2CA now provides that the approval of CBDT or Chief Commissioner or Director General granted before 1st December, 2006 shall at any one time have effect for a period not exceeding three assessment years.

[Notification No. 357/2006 dated 24th November, 2006 (157 Taxman (St.) 44) (206 CTR (St.) 80) (287 ITR (St) 110)]

2. Return by representative assessees of non-residents – Form No. 1

The Board has decided that it will not be mandatory for agents of non-residents, within the meaning of section 160(1)(a) of the Income-tax Act, to electronically furnish the returns of non-residents in Form No. 1 for the assessment year 2006-07.

[Circular No. 12 of 2006 dated 27th November, 2006 (157 Taxman (St.) 45) (287 ITR (St.) 120) (206 CTR (St.) 72)]

3. Deduction of Tax at Source – Section 192

The rates of deduction of income tax from the payment of salaries during the financial year 2006–07 and related provisions of the Income-tax Act are explained.

[Circular No. 11 of 2006 dated 16th November, 2006 (157 Taxman (St.) 59) (287 ITR (St.) 121) (206 CTR (St.) 33)]

4. Release of cash deposited in the PD Account

Section 132B lays down the procedure for application and release of assets seized u/s. 132 or requisitioned u/s. 132A. The Board has now instructed to deal with cash deposited in the PD Account in the manner given hereunder:

1. If an application is made under first proviso to S. 132B(1)(i), the seized cash should be released with in prescribed time limit after adjusting existing liability.
    

2. If the amount is not released under the above clause, it should be released with in one month of passing of search and seizure assessment order after adjusting liability determined on search and seizure assessment and if penalty proceeding is initiated then the expected liability on account of penalty.
    

3. If an assessee is in appeal against the assessment order and the penalty has not been imposed up to the date of order of the CIT(A), the amount lying in the PD Account should be reviewed and after retaining expected amount of penalty imposable based on the assessment as revised in appeal effect, balance should be released within one month from the order u/s. 250.
    

4. The amount retained after the assessment order or the order of the CIT(A) for the amount of penalty imposable, should be released within one month from passing of the penalty order after recovering demand.
    

5. If the assessment was made before issue of this instruction and cash in PD Account has not been dealt with, all the assessing officers should release within one month from the date of instruction after adjusting any existing demand and expected amount of penalty, if any imposable.

[Instruction No. 11/2006 dated 1st December, 2006 (157 Taxman (St.) 110) (206 CTR (St) 81)]

5. Tax Return Preparer Scheme, 2006

Tax Return Preparer Scheme, 2006 has been notified.

[Notification No. 358/2006 dated 28th November, 2006 (157 Taxman (St.) 102) (206 CTR (St.) 86) (287 ITR (St) 113)]

6. Revenue Audit objection

The Board has issued consolidated instruction on various aspects of the work relating to Revenue Audit with regard to procedure to be followed at different stages of Audit Objections, appropriate remedial action thereon, Schedule of replies, monitoring and accountability measures and so on.

[Instruction No. 9/2006 dated 7th November, 2006 (157 Taxman (St.) 23) (206 CTR (St) 72)]

7. Guidelines for PAN for Non-Resident

Guidelines for allotment of PAN to persons residing outside India and foreign citizen.

Circular No. 4 (157 Taxman 114) (St.)

8. Double Taxation Avoidance Agreement

Sec. 90 of I.T. Act – 1961 – Double Taxation Agreement – Agreement for Avoidance of Double Taxation and Prevention of Fiscal Evasion with Foreign Countries – Amendments in DTAA with Kingdom of Norway.

Notification No. 368/2006 dt. 15-12-2006 (157 Taxman 168 (St.)

9. Deduction of tax at source – Payments to contractors and

sub-contractors – (contract manufacturing)

Sec. 194C – Deduction of tax at source – payments to contractors and sub-contractors – Applicability of TDS provisions of sec. 194C on contract for fabrication of article or thing as per specification given by the Assessee (contract manufacturing) – Contradiction between two Circulars of CBDT – Resolution thereof. – It has been clarified that provisions of sec. 194C will apply in respect of “contracts for work” and not for contract for sale, accordingly, if there is a contract for supply of any article even though with prescribed specifications, provision for sec. 194 will apply only if it is “contract for work” and not where it is contract for sale as per the principles laid down in para 7(vi) of Circular No. 681 dt. 8-3-1994.

Circular No. 13 dt. 13-12-2006 (157 Taxman 167 (St.) and 287 ITR 174 (St.)