Section 36 1 viia income tax act 1961 download

The sc further held that the proviso to section 36 1 vii of the act is only triggered in cases where the provisions of section 36 1 viia of the act are applicable. Income tax act 58 of 1962 south african government. Act 53 income tax act 1967 arrangement of sections part i preliminary section 1. Some landmark judgements of supreme court on direct taxes. Section 9 of income tax act income deemed to accrue or arise.

Supreme court of india sc held that the provisions of section 361vii and section 361viia of the incometax act, 1961. Section 361ii of the income tax act, 1961 act for short provides that any sum paid to the employee as bonus or commission for services rendered, where such sum would not have been payable to him as profits or dividend if it had not been paid as bonus or commission is deductible. Section 36 1 viia of the incometax act, 1961 bad debts assessment of banks allowance of deduction to rural branches instruction no. Computation of aggregate average advances for the purposes of clause viia of subsection 1 of section 36. Dec 12, 2008 in particular, deductions under the provisions referred to below should be allowed only after a thorough examination of the claim on facts and on law as per the provisions of the i. Cbdt circular on section 361viia of the incometax act. Income tax deductions allowed under chapter via of income tax act. Section 361 in the income tax act, 1995 1 the deductions provided for in the following clauses shall be allowed in respect of the matters dealt with therein, in computing the income referred to in section 28.

Income tax act 1961 complete act citation 3688 bare. In the case of an assessee to which section 36 1 viia applies, the amount of deduction in respect of the bad debts actually written off under section 36 1 vii shall be limited to the amount by which such bad debts exceeds the credit balance in the provision for bad and doubtful debts account made under section 36 1 viia without any distinction between rural advances and other advances. Jan 17, 20 some landmark judgements of supreme court on direct taxes 1. Section 361viia of the incometax act, 1961 bad debts assessment of banks allowance of deduction to rural branches instruction no.

Direct tax laws amendment act, 1987 amended the provisions of sections 36 1 vii and 36 2 of the income tax act 1961, hereafter referred to as the act to rationalize the provisions regarding allowability of bad debt with effect from the 1st april, 1989. Section 200 of income tax act duty of person deducting tax section 200. The sc further held that the proviso to section 361vii of the act is only triggered in cases where the provisions of section 361viia of the act are applicable. In section 9 of the income tax act, in sub section 1, in clause i, the existing explanation shall be numbered as explanation 1 thereof and after explanation 1 as so numbered, the following explanations shall be inserted by finance act, 2003 with effect from the 1st day of april, 2004 explanation 1. Income tax act, 1961 as amended by finance act 2019 2018 2017 2016 2015 2014 20 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985 1984 1983 1982 1981 1980 1979 1978 1977 1976 1975 1974 1973 1972 1971 1970 1969 1968 1967 1966 1965 1964 1963 1962 1961. Section amount debited to profit and loss account amounts admissible as per the provisions of the income tax act, 1961 and also fulfils the conditions, if any specified under the relevant provisions of income tax act, 1961 or income tax rules, 1962 or any other. Interpretation part ii imposition and general characteristics of the tax 3. Jul 14, 2015 income in this act connotes a periodical monetary return coming in with some sort of regularity, or expected regularity, from definite sources. No section 263 revision permissible if ao had conducted. However, by virtue of the proviso to section 361vii of the act, what is allowed as a provision for bad and doubtful debts under the provisions of section 36 1 viia cannot be allowed under the provisions of section 361 vii. The following propositions are wellsettled with regard to the binding nature of a judgment of the supreme court. Provided that the amount of income tax computed in accordance with the provisions of section 111a or section 112 or section 112a of the income tax act shall be increased by a. The income tax act, 19611 does not contain specific provisions.

Income tax act 1961 complete act citation 530 bare. The assessee is a cooperative bank eligible for deduction us. Section 200 of income tax act duty of person deducting tax. Provided that the amount of incometax computed in accordance with the provisions of section 111a or section 112 or section 112a of the incometax act shall be increased by a. As per section 36 1 viii of income tax act 1961 in respect of any special reserve created and maintained by a specified entity, an amount not exceeding twenty per cent of the profits derived from eligible business computed under the head profits and gains of business or profession before making any deduction under this clause carried to such reserve account.

Direct tax laws amendment act, 1987 amended the provisions of sections 361vii and 362 of the income tax act 1961, hereafter referred to as the act to rationalize the provisions regarding allowability of bad debt with effect from the april, 1989. Income of local authorities section 1020 income tax. Direct tax laws amendment act, 1987 amended the provisions of sections 36 1 vii and 36 2 of the income tax act 1961, hereafter referred to as the act to rationalize the provisions regarding allowability of bad debt with effect from the april, 1989. Section276 removal, concealment, transfer or delivery of property to. Tax provisions for hfcs, by somesh lund vinod kothari consultants. Global business tax alert sharp insights explanation to section 9 does not override the. Sep 02, 2011 section 361ii of the income tax act, 1961 act for short provides that any sum paid to the employee as bonus or commission for services rendered, where such sum would not have been payable to him as profits or dividend if it had not been paid as bonus or commission is deductible. Therefore, making of a provision for bad and doubtful debt equal to the amount mentioned in this section is a must for claiming such. Under the existing provisions of section 361viia of the incometax act.

Download of conso files without correcting unmatched challans in tds statements. Direct tax laws amendment act, 1987 amended the provisions of sections 361vii and 362 of the income tax act 1961, hereafter referred to as the act to rationalize the provisions regarding allowability of bad debt with effect from the 1st april, 1989. Compliance related relaxations under income tax act, 1961. In particular, deductions under the provisions referred to below should be allowed only after a thorough examination of the claim on facts and on law as per the provisions of the i. Rebate of incometax in case of individuals of sixtyfive years or above omitted. Nov, 2015 the provisions of sections 361vii and 361viia of the act are distinct and independent from each other. Whether provisions for npa can be equated with provision for. Income tax act 1961 complete act citation 3688 bare act. Substituted for clause vii by the finance act, 2003, w. The limit specified under section 361 viiaa of the act restrict the claim. Form of report for claiming deduction under clause xi of subsection 1 of section 36. What is the meaning of certain activities not to constitute business connection in india. Cbdt circular on section 361vii1viia2 of the incometax act, 1961 bad debts bad and doubtful debtsirrecoverable loans interest thereon suspense account maintained for the purpose of instructions regarding. Section275b failure to comply with the provisions of clause iib of sub section 1 of section 2 section276 removal, concealment, transfer or delivery of property to thwart tax recovery section276a failure to comply with the provisions of subsections 1 and 3 of section 178.

Income tax act 1961, indian bare acts at, a website for indian laws and bareacts, legal advice and law documents in india. The deduction allowable under section 36 1 viia of the income tax act, 1961, is in respect of the provision made. Cbdt circular on claim of deduction for bad debts us 36 1 vii. Where revision was invoked against assessee to question deduction allowed towards bad debts written off in respect of nonrural advances under section 361vii, payment made towards contribution to gratuity fund, penalty payment to rbi for violation of kyc norms and provision for wage arrears, since assessing officer had conducted detailed enquiry in respect of all these issues during. Failure to comply with the provisions of clause iib of subsection 1 of section 2. Cbdt circular on claim of deduction for bad debts us 36. Whether, the tribunal is right in law and on facts in confirming the order made by the cita allowing the assessees claim for depreciation and investment allowance at the higher rate on proportionate basis when the provisions of rule 5 had been. Direct tax laws amendment act, 1987 amended the provisions of sections 36lvii and 362 of the income tax act 1961, hereafter referred to as the act to rationalize the provisions regarding allowability of bad debt with effect from the 1 st april, 1989. Section 36 1 vii of the income tax act, 1961, read with the nbfcs prudential norms reserve bank directions, 1998 bad debts whether 1998 directions deal only with presentation of npa provisions in balance sheet of a nbfc and they have nothing to do with computation or taxability of provisions for npas under income tax act held, yes.

Going by the plain language of the section as it stood at the relevant point of time, it can be seen that creation of a special reserve was sufficient to entitle the assessee to claim the benefit under section 361viii of the incometax act and that the word and maintained was inserted only with effect from 1. Deemed profits chargeable to tax as business income under profits and gains of. Nonchargeability to tax in respect of offshore business activity 3 c. Incometax act, 1961 as amended by finance act 2019 2018 2017 2016 2015 2014 20 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985 1984 1983 1982 1981 1980 1979 1978 1977 1976 1975 1974 1973 1972 1971 1970 1969 1968 1967 1966 1965 1964 1963 1962 1961. Section 224xv of the act, defining income, includes therein any sum of money or value of property referred to in section 562vii viia of the act. Section 9 of income tax act income deemed to accrue or arise in india 9.

Clarification for amount to be eligible for deduction as bad debts in. May 24, 2016 the issue is whether the provisions for nonperforming assets can be equated with provision for bad and doubtful debts, for purpose of claiming deduction us 361viiab. The delhi high court held that the substitution of explanation1 to section 9 does not affect the source rule in section 91viib of the incometax act, 1961 and the retrospective amendment makes no difference to the nontaxability of such income. A bank incorporated by or under any foreign laws or a public financial. As per section 361viia of the income tax act, 1961 only banks and financial institutions are allowed deduction in respect of the provisions.

Section 200 and 200a of income tax act 1961 duty of person deducting tax and processing of statements of tax deducted at source are defined under section 200 and 200a of income tax act 1961. Section 36, incometax act, 1961 2015 other deductions. Income in this act connotes a periodical monetary return coming in with some sort of regularity, or expected regularity, from definite sources. Whether provisions for npa can be equated with provision. The provisions of sections 361vii and 361viia of the act are distinct and independent from each other. Where the total income of any member of such association or body is chargeable to tax at a rate which is higher than the maximum marginal rate, tax. Section 9 of income tax act income deemed to accrue or. The income tax department never asks for your pin numbers, passwords or similar access information for credit cards, banks or other financial accounts through email the income tax department appeals to taxpayers not to respond to such emails and not to share information relating to their credit card, bank and other financial accounts. As per 562vii, the following received by an individul or huf was considered as income. Section 361vii in the income tax act, 1995 vii 3 subject to the provisions of sub section 2, the amount of 4 any bad debt or part thereof which is written off as irrecoverable in the accounts of the assessee for the previous year. This view has also been upheld in the case of state bank of patiala where it was held. Amendment in section 192a of the it act, 1961 instructions for deduction of tds on withdrawal from pf. Aug 22, 2018 27 clause 19 amounts admissible 17 amounts admissible under sections.

In this act, unless the context otherwise requires. Bank of ceylon, chennai with headquarters at colombo, sri lanka is assessed in india as foreign company. Assessment of banks checklist for deductions regarding. Section 43a of the incometax act, 1961 foreign currency, rate of. It deductions allowed under chapter via sec 80c, 80ccc. Cbdt circular on claim of deduction for bad debts us 36 1. Sc section 361iii of the 1961 act has to be read on its own terms. However, by virtue of the proviso to section 361vii of the act, what is allowed as a provision for bad and doubtful debts under the provisions of section 361viia cannot be allowed under the provisions of section 361 vii. Provision for bad and doubtful debts relating to rural branches of commercial banks. This provision is an enabling provision allowing deduction o account of bonus or commission paid to. Direct tax laws amendment act, 1987 amended the provisions of sections 36 lvii and 36 2 of the income tax act 1961, hereafter referred to as the act to rationalize the provisions regarding allowability of bad debt with effect from the 1 st april, 1989. Deduction us 361 viii of incometax act, 1961 metax act, 1961, financial corporations engaged in providing long term finance for industrial or agricultural development in india are entitled to a deduction, in the computation of their taxable profits, of the amount transferred by them out of such profits to a special reserve account, upto a specified percentage of their total income. The issue is whether the provisions for nonperforming assets can be equated with provision for bad and doubtful debts, for purpose of claiming deduction us 361viiab. Infrastructure facility under clause d of the explanation to clause viii of subsection 1 of section 36.

Vi a or an amount not exceeding two per cent of the aggregate average advances made by the rural branches of such bank, computed in the prescribed manner, whichever is higher by the income tax amendment act, 1986, w. Income tax act 1961 complete act citation 530 bare act. Association of persons aop and body of individuals boi a where the individual share of the members of an aqps bois are unknown tax shall be charged on the total income of the body at the maximum marginal rate of tax. Section 9 of income tax act 1961 income deemed to accrue or arise in india is defined under section 9 of income tax act 1961. Section 11 and 12 of income tax act 1961 both section are covered under income which do not form part of total income section 11 section 11 tax exemption after consider provisions of section 60 to 63, the income of a religiouscharitable trustinstitutions, to the extent specified in the act, is exempt from tax after fulfill certain conditions.

Section 361vii and 361viia are separate, distinct and. Meaning of previous year under income tax act, 1961. In respect of any provision for bad and doubtful debts made by. The provisions of sections 36 1 vii and 36 1 viia of the act are distinct and independent from each other. In section 9 of the income tax act, in subsection 1, in clause i, the existing explanation shall be numbered as explanation 1 thereof and after explanation 1 as so numbered, the following explanations shall be inserted by finance act, 2003 with effect from the 1st day of april, 2004 explanation 1. The deduction allowable under section 361viia of the incometax act, 1961, is in respect of the provision made. Vii 3 subject to the provisions of sub section 2, the amount of 4 any bad debt or part thereof which is written off as irrecoverable in the accounts of the assessee for the previous year. Section 361iii is attracted when the assessee borrows the capital for the purpose of his business. A flowchart is appended for understanding the implications of the amended provisions in the income tax act, 1961. Let us discuss briefly about all the sections with reference to the income tax act 201415.