Income Tax, Update

The Taxation and Other Laws (Relaxation of Certain Provisions) Ordinance No 2, 2020

Here’s a summary of the ordinance no 2 of year 2020:

Specified Acts

  1. The Wealth Tax Act, 1957
  2. The Income Tax Act, 1961
  3. The prohibition of Benami Property Transactions Act, 1988
  4. Chapter VII of the Finance (No. 2) Act, 2004
  5. Chapter VII of the Finance Act, 2013
  6. The Black Money (Undisclosed Foreign Income and Assets) and the imposition of Tax Act, 2015
  7. Chapter VIII of the Finance Act, 2016
  8. Direct Tax Vivaad se Vishwas Act, 2020;

The government has notified that under the above-mentioned specified acts if any time limit for certain actions like –

  1. Completion of any proceeding, or passing of any order, or issue of any notice;
  2. Filing of appeal or replies, or furnishing of documents;
  3. Actions for the purpose of claiming exemption under section 54 to 54GB of the Income Tax Act;
  4. Beginning of manufacture of articles in reference to Section 10AA of the Income Tax Act where approval has been issued before 31st March 2020;

falls within the period of 20th March 2020 to 29th June 2020, will be extended to 30th June 2020, or any such day as the government may notify.
For the same acts, if any amount of tax was due for payment in the period between 20th March 2020 and 29th June 2020 and has not been paid in the time period, but has been paid on or before 30th June 2020 or any such subsequent date as the government notifies, then the rate of interest for delayed payment will not exceed ¾% for every month of delay. Further, no penalty or prosecution can be initiated for the said delay.

Amendment to Income Tax Act

  • Income received on behalf of PM Cares Fund has been exempted under section 10 clause 23C
  • The contribution made to PM Cares Fund is deductible u/s 80G 

Amendment to Vivaad se Vishwas Act

  • The time limit for scheme increased to 30th June 2020 

Amendment to Indirect Tax Laws

  • Under the Central Excise Act, the Customs Act, the Customs Tariff Act:

for actions like completion of proceedings, issue of notice, filing of an appeal, furnishing of any document and the like, if the time limit prescribed for completion falls between 20th March 2020 and 29th June 2020, then the same will be extended to 30th June 2020 or any subsequent date notified by the government.

Amendment to Finance Act (No. 2), 2019

  • Various extensions of time limits from a prescribed number of days to fixed calendar dates

Amendment to Central Goods and Services Tax Act

  • Insertion of Section 168A in the nature of a force majeure clause authorizing an extension of time limits.

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