Income Tax & Central Sales Tax - Sections

Income - Tax Act Introduction [Sections 1 to 4] 1 Name of the Act and Date of its commencement 2 Definitions 2(7) Assessee 2(9) Assessment Year 2(22) Dividend 2(23B) Fringe Benefits 2(24) Income 2(31) Person 2(34) "Previous Year" defined 2(43) Tax 4 Charge of Income tax Scope of Total Income & Residential Status [Sections 5 to 9] 2(30) Non - Resident defined 2(45) Total Income defined 5 Scope of Total Income/Incidence of Tax 5(1) Scope of Total Income in case of resident in India Proviso to Section 5(1) Scope of Total Income in case of not ordinarily resident in India 5(2) Scope of Total Income in case of non resident 5A Apportionment of income between spouses governed by Portuguese Civil Code 6 Resident in India 6(1) Rules for determining the residential status of an individual 6(2) Rules for determining the residential status of an HUF, Firm, AOP, BOI 6(3) Rules for determining the residential status of a company 6(4) Rules for determining the residential status of firm/AOP/BOI 6(5) Deemed Resident 6(6) Not ordinarily resident in India 7 Incomes received or deemed to be received 8 Dividend Income 9 Income deemed to accrue or arise in India Income which do not form part of Total Income [Sections 10, 10A, and 10B] 10(1) Agricultural income 10(2) Sum received by a member from HUF 10(2A) Share of profit of a partner from a firm 10(4) Interest on securities or bonds held by a non resident/interest on Non - resident (External) Account 10(4B) Interest on Savings Certificates of Non - resident Indian Citizen, etc. 10(5) Travel concession or assistance received by an individual from his employer 10(6) Remuneration to certain persons who are not citizens of India 10(6A) Tax payable on royalty or fees for technical service on behalf of foreign company 10(6B) Tax payable on certain income of and on behalf of a non-resident or a foreign company 10(6BB) Tax payable on income from leasing of aircraft, etc. 10(6C) Income of foreign companies providing technical services in projects connected with security of India 10(7) Allowances or perquisites outside India 10(8) Remuneration under Co-operative Technical Assistance Programmes 10(8A),10(8B), & 10(9) Remuneration or fee received by non-resident 'consultants', their employees, and their family members

10(10) 10(10A) 10(10AA) 10(10B) 10(10BB) 10(10C) 10(10CC) 10(10D) 10(11) 10(12) 10(13) 10(13A) 10(14) 10(15) 10(15A) 10(16) 10(17) 10(17A) 10(18) 10(19) 10(19A) 10(20) 10(21) 10(22B) 10(23A) 10(23AA) 10(23AAA) 10(23AAB) 10(23B) 10(23BB) 10(23BBA) 10(23BBB) 10(23BBC) 10(23BBD) 10(23BBE) 10(23C) 10(23D) 10(23EA) 10(23EB) 10(23FB) 10(23G) 10(24) 10(25) 10(25A) 10(26) 10(26B) 10(26BB) 10(26BBB) 10(27) 10(29A)

Death-cum-retirement gratuity received by an employee Payment in commutation of pension received by the employees Leave encashment Compensation on retrenchment Payments under Bhopal Gas Leak Disaster (Processing of Claims) Act, 1985 Amount received on voluntary retirement Tax on non-monetary perquisites paid by employer Amount received under Life Insurance Policy Provident Fund Payments from Recognised Provident Fund Any payment from an approved Superannuation Fund House Rent Allowance Notified Special Allowance Interest, premium or bonus on specified investments Lease rent for leasing of an aircraft Scholarships granted to meet the cost of education Daily and constituency allowance, etc. received by MPs and MLAs Award or Reward Pension received by certain awardees/any member of their families Family pension received by the family members of armed forces personnel killed in action Annual value of one palace of the ex-ruler Income of a local authority Income of an approved scientific research association Income of specified news agency Income of professional association/institution Income of armed forces fund Income of fund established for welfare of employee and their dependents Income of a fund set-up by Life Insurance Corporation of India Income of society or trust existing for development of khadi or village industries Income of an authority known as Khadi and Village Industries Board, etc. Income of any body or authority established under an Act for administration of charity, endowment, etc. Income of European Economic Community (EEC) Income of SAARC Fund Income fo Secretariat of Asian Organisation of Supreme Audit Income of Insurance Regulatory and Development Authority Income of certain funds of national importance Income of notified mutual funds Income of Investor Protectin Fund set-up by recognised stock exchange Exemption of any income of the Credit Guarantee Fund Trust Any income of venture capital company or venture capital fund from investment in a venture capital undertaking Income of an Infrastructure Capital Fund or an Infrastructure Capital Company Income fo Trade Union Income of trustees of provident fund, gratuity fund, superannuation fund, etc. Income of Employee's State Insurance Fund Income of a member of Scheduled Tribe residing in certain speicfied areas Income of corporation of govt. or any body wholly financed by govt. for promoting interest of SC/ST/Backward classes Income of a corporation for promoting the Interest of Minority Community Income of a corporation established for the welfare and economic upliftment of ex-servicemen Income of Co-operative Societies for Scheduled Castes/ Scheduled Tribes Income of certain Boards/Authorities

10(30) 10(31) 10(32) 10(33) 10(34) 10(35) 10(36) 10(37) 10(38) 10(39) 10(40) 10(41) 10A 10AA 10B 10BA

Icome of Subsidy from Tea Board Income of subsidy from Rubber Board or Coffee Board or Spices Board or any other Notified Board Income of minor clubbed in the hands of a parent Capital gain on transfer of units of US 64 exempt if transfer takes place on or after 1-4-2002 Dividend to be exempt in the hands of the shareholders Income from units to be exempt in the hands of the unit-holders Long-term capital gian on eligible equity shares exempt if the shares are acquired within a certain period Capital gains on compensation received on compusory acquisition of agricultural land situated within specified urban limits Capital gain arising from sale of shares and units Exemption of specified income from international sporting event held in India Exemption in respect of grant, etc. received by a subsidiary company from its holding company engaged in the business of generation, etc. of distribution of power Exemption in capital gain on transfer of an asset of an undertaking engaged in the business of generation, etc. of power Income of newly established industrial undertakings in Free Trade Zones Special provisions in respect of newly established Units in Special Economic Zones Special provisions in respect of newly established 100% Export Oriented Undertakings Special provisions in respect of export of eligible articles of things

Charitable or Religious Trusts and Institutions [Sections 11 to 13] 11 Income from property helf for charitable or religious purposes 12 Income of trusts or institutions from contributions 12A Registration of trust 12AA Procedure for registration 13 Section 11 not to apply in certain cases 13A Income of political parties Rule 17 Prescribed form or modes of investment or deposit Heads of Income [Section 14] 14 Heads of Income 14A No deduction for expenditure in respect of exempt income Income under the head "Salaries" [Sections 15 to 17] 15 Basis of Charge or Chargeability of Salaries 16 Deductions from Salaries 16(ii) Deductions on account of entertainment allowance 16(iii) Deductions on account of tax on employment i.e., professional tax 17 Salary', 'Perquisite', and 'Profit in lieu of Salary' defined 17(1) Inclusive definition of 'Salary' 17(2) Inclusive definition of 'Perquisite' Proviso to Section 17(2) Treatment of Medical Facilities 17(2)(iiia) Treatment of ESOP 17(3) Inclusive definition of 'Profits in lieu of Salary' Income under the head "Income from House Property" [Sections 22 to 27] 22 Income from House Property - Chargeability and Basis of Charge 23(1)a,b,& c Annual Value, how determined Explanation to 23(1) Treatment of unrealised rent 23(2),(3) &(4) Computation of Income of a property which is occupied by the owner for his own residence or which could not actually be self occupied owing to employment 24 Deductions from income from house property 25 Interest when not deductible from "Income from House Property" 25A& 25AA Special provisions for cases where unrealised rent allowed as deduction is realised subsequently

25B 26 27 27(i) 27(ii) 27(iii) 27(iiia) 27(iiib)

Special provisions for arrears of rent received Property owned by co-owners Deemed ownership Transfer of a house property to spouse or minor child without adequate consideration Impartible Estate Members of cooperative society, company or other association of persons Transfers in a part – performance contract Power of attorney type of transactions

Income under the head "Profits and Gains from Business or Profession" [Sections 28 to 44D] 28 Profits and Gains of Business or Profession Chargeability/Scope of income under this head 29 Income from Profits and Gains of Business or Profession, how computed? 30 Rent, Rates, Taxes, Repairs and Insurance for Buildings 31 Reparis and Insurance of Machinery, Plant and Furniture 32 Depreciation 32(2) Treatment of unabsorbed depreciation 33AB Tea Development Account/Coffee Development Account and Rubber Development Account 33ABA Site Restoration Fund 33AC Reserves for Shipping Business 35 Expenditure on Scientific Research 35(2AA) Weighted deduction for contribution to National Laborator, University, etc 35(2AB) Weighted deduction on in-house research and development to company assessee 35ABB Expenditure for obtaining license to operate telecommunication services 35AC Expenditure on eligible projects or schemes 35CCA Expenditure by way of payment to association and institutions for rural development programmes 35D/Rule 6AB Amortisation of certain preliminary expenses 35DD Amortisation in case of amalgamation or demerger 35DDA Amortisation of expenditure income under voluntary retirement scheme 35E/Rule 6AB Deduction for expenditure on prospecting etc., for certain minerals 36 Other deductions 36(1)(i) Insurance premium of stocks 36(1)(ia) Insurance premium of cattle 36(1)(ib) Insurance on health of employees 36(1)(ii) Bonus or commission to employees 36(1)(iii) Interest on borrowed capital 36(1)(iiia) Discount on issue of zero coupon bonds to be allowed as deduction on pro rata basis 36(1)(iv) Employer's contribution to a recognised provident fund or approved superannuation fund 36(1)(v) Employer's contribution to an approved gratuity fund 36(1)(va) Sums received from employees towards certain welfare schemes if credited to their accounts before the due date 36(1)(vi) Allowance in respect of dead or permanently useless animals 36(1)(vii) Bad Debts 36(1)(viia) Provisions for bad and doubtful debts in respect of rural branches of scheduled banks or non-scheduled banks 36(1)(viii) Special reserve created by financial corporation, etc. 36(1)(ix) Expenditure on promoting family planning amongst the employees 36(1)(x) Contribution by public financial institution to Exchange Risk Administration Fund 36(1)(xii) Revenue expenditure incurred by a corporation, etc. established by Central, State or Provincial Act 36(1)(xiii) Deduction of banking cash transaction tax 37(1) General Deductions 37(2B) Advertisement to political parties 38 Building, etc., partly used for business, etc., or not exclusively so used

40 40(a) 40(b) 40(ba) 40A 40A(2) 40A(3) & Rule 6DD 40A(7) 40A(9) 41 42 43(1) Expln. to sec 43(1) 43(2) 43(3) 43(4) 43(6) 43B 43D 44 44A 44AA & Rule 6F 44AB & Rule 6G 44AD 44AE 44AF 44B 44BB 44BBA 44BBB 44C 44D

Amounts not deductible In case of all assessees Disallowable in case of partnership firm Disallowable in case of AOP/BOI Expenses or payments not deductible in certain circumstances Payments to relatives Disallowance out of cash expenditure exceeding Rs. 20000 Disallowance in respect of provision for gratuity Disallowance in respect of contribution to Non-statutory Funds Deemed profits chargeable to tax Special provisions for deductions in the case of business for prospecting, etc., for mineral oil Actual Cost Notional Actual Cost Paid Plant Scientific Research Written Down Value Certain deductions to be only on actual payment Special provisions in case of income of public financial institutions etc. Insurance Business Special provision for deduction in the case of trade, professional or similar association Maintenance of accounts by certain persons carrying on business or profession Compulsory audit of accounts Special provisions for computing profits and gains of business of civil construction Special provisions for computing profits and gains of business of plying, hiring or leasing goods carriages Special provisions for computing profits and gains of retail business Special provisions for computing profits and gains of shipping business in the case of non-residents Special provisions for computing profits and gains in connection with the business of exploration, etc., of mineral oils Special provisions for computing profits and gains of business of operation of aircraft in the case of non-residents Special provisions for computing profits and gains of foreign companies engaged in the business of civil construction, etc., in certain turnkey power projects Deduction of head office expenditure in the case of non-residents Special provisions for computing income by way of royalties, etc, in the case of foreign companies

Income under the head "Capital Gains" [Sections 45 to 55A] 45 Capital Gains 45(1) Basis of Charge 45(1A) Capital gain arises from insurance claims received for damage or destruction of a capital asset 45(2) Capital gain on conversion of capital asset into stock-in-trade 45(2A) Transfer of securities by depository 45(3) Capital gain on transfer of a capital asset by a person to a firm/AOP as capital contribution 45(4) Capital gain on transfer of a capital asset by way of distribution on dissolution of a firm/AOP 45(5) Capital gain on transfer by way of compulsory acquisition of an asset 45(6) Capital gain on repurchase of units of mutual funds under Equity Linked Savings Schemes 46 Capital gain on distribution of assets by companies in liquidation 46(1) Whether capital gain arises to company or not 46(2) Whether capital gain arises to shareholders or not 46A Capital gains on purchase of own shares or securities 47 Transactions not regarded as transfer 47A Withdrawal of exemption in certain cases 48 Mode of computation of capital gain

Sec 48 Prv1/Rule 115A Expln(iii) to sec 48 Expln(iv) to sec 48 49 50 50A 50B 50C 51 54 54B 54D 54EC 54ED 54F 54G 54GA 54H 55 55(1)(b) 55(2) 55A

Capital gain in the cse fo tranfer fo certain shares/debentures by non-resident Indexed cost of acquisition Indexed cost of improvement Deemed cost of acquisition Special provision for computation of capital gains in case of depreciable assets Capital gain of depreciable assets of electricity companies Special provision for computation of capital gains in case of slump sale Computation of capital gains in real estate transactions Advance money received Profit on sale of property used for residence Capital gain on transfer of land used for agriculture pruposes not to be charged in certain cases Capital gain on compulsory acquisition of lands and buildings not to be charged on investment in certain bonds Capital gain on transfer of long-term capital assets not to be charged on investment in certain bonds Captial gain on transfer of certain listed securities or units Capital gain on transfer of certain capital assets not to be charged in case of investment in residential house Exemption of capital gains on transfer of assets in cases of shifting of Industrial Undertaking from Urban area Exemption of capital gains on transfer of assets due to shifting of industrial undertaking from urban area to special economic zone Extension of time for acquiring new asset or depositing or investing amount of capital gain Meaning of 'cost of improvement' and 'cost of acquisition' Cost of improvement Cost of acquisition Reference to Valuation Officer

Income under the head "Income from Other Sources" [Sections 56 to 59] 56 Income from other sources 56(1) Chargeability 56(2) Specific incomes included under income from other sources 56(2)(i) Taxability of dividend 56(2)(ib) Winnings from lotteries, crossword puzzles, etc. 56(2)(ic) Contribution of employees towards welfare fund 56(2)(id) Interest on securities 56(2)(ii) Income from letting out of machinery, plant and furniture 56(2)(iii) Income from composite letting out of machinery, plant, furniture and building 56(2)(v) Income to include gift of money from unrelated person 57 Deductions 57(i) Deduction in case of dividends and interest on securities 57(ia) Deduction in case of employees' contribution to welfare fund 57(ii) Deduction permissible for letting out of machinery, plant, furniture and buildings 57(iia) Deduction from family pension received by legal heirs of deceased employee 57(iii) Deduction for any other expenditure 58 Amounts not deductible 59 Deemed income chargeable to tax Income of other persons included in Assessee's Total Income (Clubbing of Income)[Sections 60 to 65] 60 Transfer of income without tranfer of assets 61 Revocable transfer of assets 62 Transfer irrevocable for a specified period 63 Transfer and revocable transfer defined 64 Income of an individual to include income of spouse, minor child, etc. 64(1)(i) Omitted

64(1)(ii) 64(1)(iii) 64(1)(iv) 64(1)(v) 64(1)(vi) 64(1)(vii) 64(1)(viii) 64(1A) 64(2) 65

Remuneration of a spouse from a concern in which the other spouse has substantial interest Omitted Income from assets transferred to the spouse Omitted Income from assets transferred to son's wife Income from assets transferred to any person for the benefit of the spouse of the transferor Income from assets transferred to any person for the benefit of Son's Wife of the transferor Clubbing of income of a minor child Income from self acquired property converted to joint family property Liability of person in respect of income included in the income of another person

Set off or Carry Forward and set off of Losses [Sections 70 to 80] 70 Set off of loss from one source against income from another source under the same head of income 71 Set off of loss from one head against income from another 71B Carry forward and set off of loss from house property 72 Carry forward and set off of business losses 72A Provisions relating to carry forward and set off of accumulated loss and unabsorbed depreciation allowance in certain cases of amalgamation 72A(6) Carry Forward and set off of losses on succession of the firm 73 Losses in speculation business 74 Losses under the head "Capital Gains" 74A Carry forward and set off of loss from activity of owning and maintaining race horses 75 Losses of firms prior to assessment year 1992-93 76 Omitted 77 Omitted 78 Carry forward and set off of losses in case of change in constitution of firm or on succession 79 Carry forward and set off of losses in the case of certain companies 80 Compulsory filing of loss returns Deductions to be made in computing Total Income [Sections 80A to 80U (Chapter VI A)] 80A/AB Basic rules of deductions 80C Deduction in respect of Life Insurance Premia,Contribution to Provident Fund, etc. 80CC/CCA/CCB Either omitted or not relevant 80CCC Deduction in respect of contribution to certain pension funds 80CCD Deduction in respect of contribution to notified pension scheme of central government 80CCE Limit on deductions u/s 80C,80CCC & 80CCD 80D Deduction in respect of medical insurance premia 80DD Deduction in respect of maintenance including medical treatment of a dependant who is a person with diability 80DDB Deduction in respect of medical treatment, etc. 80E Deduction in respect of repayment of loan taken for higher education 80G Deduction in respect of donations to certain funds, charitable institutions, etc. 80GG Deductions in respect of rent paid 80GGA Deduction in respect of certain donations for scientific research or rural development, etc. 80GGB Deduction in respect of contributions given by companies to political parties 80GGC Deduction in respect of contributions given by any person to political parties 80-IA Deduction in respect of profits and gains from industrial undertakings or enterprises engaged in infrastructure development, etc. 80-IAB Deduction in respect of profits and gains by an undertaking a enterprise engaged in development of special economic zone 80-IB Deduction in respect of profits and gains from certain industrial undertakings other than infrastructure development, etc. 80-IC Deduction in respect of certain undertakings or enterprises in certain special category states 80JJA Deduction in respect of profits and gains from business of collecting and processing or bio degradable waste 80JJAA Deduction in respect of employment of new workmen

80LA 80P 80QQB 80RRB 80U

Deduction in respect of certain incomes of Offshore Banking Units Deduction in respect of income of co-operative societies Deduction in respect of royalty income, etc., of authors of certain books other than text books Deduction in respect of royalty on patents Deduction in the case of a person with disability

Rebates and Reliefs of Income-Tax [Sections 87 to 89] 87 Rebate of Income-Tax 88E Rebate in respect of securities transaction tax 89(1) Relief of Income Tax Income Tax Authorities [116 to 138] 116 Income Tax Authorities 117 Appointment of income tax authorities 118 Control of income tax authorities 119 Instructions to subordinate authorities 120 Jurisdiction of income tax authorities 124 Jurisdiction of Assessing Officers 127 Power to transfer cases 129 Change of incumbent of an office 131 Power regarding discovery, production of evidence, etc. 132 Search and Seizure 132A Power to requisition books of accounts etc. 133 & 134 Power to call for information and inspect registers of companies 133A Power of survey 133B Power to collect certain information 135 & 136 Other provisions 138 Disclosure of information regarding assesses Return of Income and Procedure of Assessment [Sections 139 to 157] Return of Income 139 Return of income 139(1) Submission of return of income 139(1) 1st Provisio Obligatory filing of return 139(1A) Bulk filing of returns of the employees by the employer on computer readable media 139(1B) Return may be filed on a specified computer readable media Rule 12 Form of return of income 139(2) Omitted 139(3) Return of loss 139(4) Belated return 139(4A) Return of income of charitable institutions 139(4B) Return of income of political party 139(4C) Return of income of certain associations and institutions 139(5) Revised return 139(6)/(6A) Particulars to be furnished with the return 139(9) Defective return 139A Permanent Account Number 140 Return by whom to be signed 140A Self Assessment Procedure for Assessment

142 143 143(1) 143(2) 143(3) 144 144A 145 146 147 148 149 151 153 153A 153B 153C 154 155 156 157

Enquiry before assessment Assessment Summary assessment on basis of returns Compulsory issue of notice Regular/Scrutiny assessment on basis of return of income Best judgment assessment Power of Joint Commissioner to issue directions in certain cases Method of Accounting Omitted Income escaping assessment Issue of notice where income has escaped assessment Time limit for issue of notice Sanctions for issue of notice Time limit for completion of all assessments and reassessments Notice for filing return in search cases Time limit for completion of assessment of search cases Assessment of income of any other person in search cases Rectification of mistakes Other amendments Notice of demand Intimation of loss

Appeals, References and Revision [Section 246 to 264] 246A Appeal to Commissioner (Appeals) 247 Omitted 248 Appeal by person denying liability to deduct tax 249 Procedure for filing appeal 250 Procedure in hearing appeal 251 Powers of Commissioner (Appeals) 252 Appellate Tribunal 253(1)&(2) Appeals to Appellate Tribunal 254 Orders of Appellate Tribunal 260A Direct appeal to High Court 261 Appeal to the Supreme Court 263 Revision of orders prejudicial to revenue 264 Revision of orders in favour of assessee 268 Exclusion of time for calculating time limit for filing appeal

Central Sales Tax Act [Sections 1 to 26] Introduction [Sections 1 to 2] 1 Name of the Act and date of commencement 2 Definitions 2(a) Appropriate State 2(aa) Business 2(b) Dealer 2c Declared Goods 2(d) Goods 2(dd) Place of business 2(f) Registered Dealer

2(g) 2(h) 2(i) 2(j) 2(ja) 2(k) 3 8

Sale Sale Price Sales tax law Turnover Works contract Year In the course of Inter-state trade or commerce Rate of sales tax

Formulation of principles for determining (A) When a sale or purchase of goods takes place in the course of inter-state trade or Commerce; or (B) Outside a state; or [C] In the course of import or export [Sections 3 to 5] 3 When is a sale or purchase of goods said to take place in the course of Inter-state Trade or Commerce 3(a) Sale/Purchase which occasion the movement of goods from one state to another 3(b) Sale by transfer of documents 4 When is a sale or purchase of goods said to take place outside a State 5 When is a sale or purchase of goods said to take place in the course of import or export 5(1) Export of goods out of India 5(2) Import of goods into India Inter-State Sales-Tax [Section 6] 6(1)&6(1A) Liability to tax on Inter-state sales 6(2) Exemption from Central Sales Tax on subsequent sale 6A Transfer of goods otherwise than by way of sale Registration of Dealers [Section 7] 7(1) Compulsory Registration 7(2) Voluntary registration 7(3)&Rule 3 Procedure for obtaining registration 7(4)(a) Amendment of certificate of registration 7(4)(b)&(5) Cancellation of certificate of registration Rates, Levy and Collection of Tax [Sections 8 and 9] 81)&8(2) Rate of tax 8(1)(a) Sale to the Government 8(5) Exemption through notification 8(6),(7)&(8) Units located in any special economic zone 8A Determination of turnover 9(1) Levy of Central Sales Tax 9(2) Powers of the authorities of appropriate states 9(2B) Liability to pay interest 9(3) Distribution of tax proceeds 9A Collection of Tax 9B Rounding off a tax, etc. Penalties and Prosecutions [Section 10/Section 10A] 10 Penalties in the form of prosecution/fine or both 10A Penalties in lieu of prosecution

Goods of special importance in Inter-state trade or commerce [Sections 14 and 15] 14 Goods of special importance in Inter-state trate or commerce 15 Restrictions and conditions in regard to tax on sale or purchase of declared goods within a state Liabilities in Special Cases [Sections 16 to 18] 16 Definitions 17 Liquidation of a company 18 Liabilities of Directors of Private Companies in Liquidation Authority to settle dispute in course of inter-state trade or commerce [Sections 19 to 26] 19 Central Sales Tax Appellate Authority 20 Appeals 21 Procedure on receipt of application 22 Powers of the Authority 23 Procedure of Authority 24 Authority of advance ruling to function as authority under this Act 25 Transfer of pending proceedings 26 Applicability of order passed