PlghllghLs of unlon 8udgeL 2014-13

D|rect 1ax roposa|s

ersona| 1axat|on
8aslc exempLlon llmlL Lo be lncreased from 8s. 2 lakhs Lo 8s. 2.3 lakhs for
Laxpayer below Lhe age of 60 years and from 8s. 2.3 lakhs Lo 8s. 3 lakhs, ln
case of senlor clLlzens.
1he exlsLlng llmlL of deducLlon under secLlon 80C Lo be lncreased from 8s.
1 lakh Lo 8s. 1.3 lakhs. 1he annual celllng llmlL for lnvesLmenL ln ubllc
rovldenL lund Lo be lncreased from 8s. 1 lakh Lo 8s. 1.3 lakh.
1he deducLlon ln respecL of lnLeresL on houslng loan borrowed for self
occupled properLy Lo be enhanced from 8s. 1.3 lakhs Lo 8s. 2 lakhs.
no change proposed ln Lhe raLe of surcharge raLe and educaLlon cess.
8us|ness 1axat|on
1ax on dlsLrlbuLed proflLs of domesLlc companles under secLlon 113-C and
Lax on dlsLrlbuLed lncome Lo unlL holders under secLlon 113-8 Lo be levled
on Lhe gross amounL of dlvldend and noL on neL amounL of dlvldend
dlsLrlbuLed.
ueducLlon under secLlon 32AC[13 of lnvesLmenL ln new planL and
machlnery Lo be allowed lf such lnvesLmenL exceeds 8s. 23 crores durlng
Lhe prevlous year. Such deducLlon ls allowable for lnvesLmenL made ln planL
and machlnery upLo 31.03.2017.
1he Lermlnal daLe for power secLor underLaklngs Lo seL-up, sLarL
Lransmlsslon or dlsLrlbuLlon or subsLanLlal renovaLlon and modernlzaLlon of
exlsLlng neLwork Lo be exLended for a furLher perlod upLo 31
sL
March, 2017.
ueducLlon ln respecL of caplLal expendlLure exLended Lo Lwo new secLors,
namely, laylng and operaLlng of slurry plpellnes for Lhe LransporLaLlon of
lron ore, and seLLlng up and operaLlng seml conducLor wafer fabrlcaLlon
manufacLurlng unlLs. erlod of 8 years belng speclfled for whlch caplLal
asseL Lo be used for speclfled buslness
1he CorporaLe Soclal 8esponslblllLy (CS8) expendlLure under secLlon 133
of Lhe Companles AcL, 2013 noL deducLlble under secLlon 37..
ulsallowance of paymenLs made Lo non-resldenLs noL Lo be aLLracLed lf
Lhe Lax ls deducLed durlng Lhe prevlous year and deposlLed on or before
Lhe due daLe of flllng of reLurn of lncome.
ulsallowance of paymenLs made Lo resldenLs wlLhouL deducLlon of Lax
Lo be llmlLed Lo 30 of such paymenL. lurLher, dlsallowance Lo be
aLLracLed for all paymenLs on whlch Lax ls requlred Lo be deducLed
under ChapLer xvll-8..
resumpLlve lncome of an assessee engaged ln Lhe buslness of plylng,
hlrlng or leaslng goods carrlage Lo be compuLed aL 8s. 7,300 per monLh
per vehlcle for all Lypes of goods carrlage vehlcles, wheLher heavy
vehlcles or noL.
rovlslons of AM1 Lo be aLLracLed Lo assessees clalmlng lnvesLmenL
llnked Lax deducLlon under secLlon 33Au
Slnce Lhe Lax accounLlng sLandards LhaL were placed ln publlc domaln
are noL lnLended for malnLenance of accounLs buL for Lhe purpose of
compuLaLlon of lncome, Lhe Lerm accounLlng sLandards" ls Lo be
replaced wlLh lncome compuLaLlon and dlsclosure sLandards".
Cap|ta| Ga|ns
unlLs of debL orlenLed muLual funds and unllsLed securlLles Lo quallfy as a
shorL-Lerm caplLal asseL, lf held for noL more Lhan 36 monLhs. 1he perlod
for quallfylng as a shorL-Lerm caplLal asseL Lo be lncreased from 12 monLhs
Lo 36 monLhs.
Long-Lerm caplLal galns on unlLs of debL-orlenLed muLual funds noL ellglble
for concesslonal raLe of Lax[10 (wlLhouL lndexaLlon beneflL),
Advance recelved and reLalned ln Lhe course of negoLlaLlons for Lransfer of
a caplLal asseL whlch dld noL maLerlallze Lo be LreaLed as lncome chargeable
Lo Lax under Lhe head lncome from oLher sources" CurrenLly, such sum ls
belng deducLed from Lhe cosL of acqulslLlon for compuLlng caplLal galns
when Lhe asseL ls subsequenLly Lransferred.
Lnhanced compensaLlon on compulsory acqulslLlon of a caplLal asseL
recelved ln pursuance of an lnLerlm order of a courL, Lrlbunal or oLher
auLhorlLy Lo be deemed as lncome chargeable under Lhe head caplLal
galns" ln Lhe prevlous year ln whlch Lhe flnal order of such CourL, 1rlbunal
or oLher auLhorlLy ls made.
CosL lnflaLlon lndex" ln relaLlon Lo a prevlous year Lo mean such lndex as
may be noLlfled by Lhe CenLral CovernmenL havlng regard Lo 73 of
average rlse ln Lhe Consumer rlce lndex (urban) for Lhe lmmedlaLely
precedlng prevlous year Lo such prevlous year. 8eference Lo Consumer
rlce lndex (Cl) for urban non-manual employees Lo be removed slnce
release of Cl for such employees has been dlsconLlnued.
SecLlons 34 and 34l Lo be amended Lo provlde LhaL Lhe beneflL of
exempLlon Lhereunder would be avallable only ln respecL of lnvesLmenL ln
one resldenLlal house s|tuated |n Ind|a.
LxempLlon under secLlon 34LC for lnvesLmenL ln long-Lerm speclfled asseL,
ouL of caplLal galns arlslng from Lransfer of one or more orlglnal asseLs, Lo
be resLrlcLed Lo 8s.30 lacs, wheLher such lnvesLmenL ls made ln Lhe same
flnanclal year or ln Lhe nexL flnanclal year or parLly ln Lhe same flnanclal
year and parLly ln Lhe nexL flnanclal year .
Char|tab|e 1rusts
Where a LrusL or lnsLlLuLlon has been granLed reglsLraLlon for avalllng
beneflL under secLlon 11 and Lhe reglsLraLlon ls ln force for a prevlous year,
Lhen, such LrusL or lnsLlLuLlon cannoL clalm any exempLlon under any
provlslon of secLlon 10 [oLher Lhan secLlon 10(1) and secLlon 10(23C)].
Llkewlse, where an enLlLy has been approved or noLlfled for clalmlng
beneflL of exempLlon under secLlon 10(23C), lL would noL be enLlLled Lo
clalm any beneflL of exempLlon under Lhe oLher provlslons of secLlon 10
[excepL Lhe exempLlon under secLlon 10(1)].
lncome for Lhe purposes of appllcaLlon under secLlon 11 and secLlon
10(23C), shall be deLermlned wlLhouL provldlng deducLlon or allowance for
depreclaLlon ln respecL of an asseL, acqulslLlon of whlch has been clalmed
as an appllcaLlon of lncome under Lhese secLlons ln Lhe same or any oLher
prevlous year. ln effecL, lf Lhe cosL of asseL has been clalmed as appllcaLlon
of lncome, Lhen depreclaLlon on such asseL cannoL be clalmed ln Lhe same
or any oLher prevlous year.
1he power of Lhe Commlssloner or rlnclpal Commlssloner Lo cancel Lhe
reglsLraLlon of Lhe LrusL or lnsLlLuLlon has been expanded. SecLlon 12AA
has been amended Lo provlde LhaL where a LrusL or lnsLlLuLlon has been
granLed reglsLraLlon and subsequenLly, lL ls noLlced LhaL lLs acLlvlLles are
belng carrled ouL ln such a manner LhaL -
(a) lLs lncome does noL enure for Lhe beneflL of general publlc,
(b) lL ls for Lhe beneflL of any parLlcular communlLy or casLe,
(c) Any lncome or properLy of Lhe LrusL ls applled for Lhe beneflL of
speclfled persons llke auLhor of LrusL, LrusLees, eLc., or
(d) lLs funds are lnvesLed ln prohlblLed modes.
Lhe reglsLraLlon may be cancelled, lf such LrusL or lnsLlLuLlon does noL
prove LhaL Lhere was a reasonable cause for Lhe acLlvlLles Lo be carrled
ouL ln Lhe above manner.
Anonymous donaLlons ln excess of one lakh or 3 of LoLal donaLlons
recelved by Lhe assessee, ls Laxable aL 30. 1he lncome-Lax payable by Lhe
assessee shall be Lhe aggregaLe of 30 of such donaLlons and Lhe lncome-
Lax, whlch would be levlable, had Lhe LoLal lncome been reduced by Lhe
aggregaLe of anonymous donaLlons whlch ls ln excess of 3 of LoLal
donaLlons recelved by Lhe assessee or one lakh, whlchever ls hlgher.
Non-res|dent 1axat|on
1he beneflL of concesslonal raLe of wlLhholdlng Lax[3 exLended Lo
borrowlngs by way of lssue of any long-Lerm bond, and noL resLrlcLed only
Lo long-Lerm lnfrasLrucLure bonds. lurLher, Lhe perlod for whlch Lhe
beneflL ls avallable Lo be exLended by Lwo years l.e. borrowlngs made
before 1
sL
!uly, 2017.
8eneflL of concesslonal raLe of 13 on dlvldend recelved by lndlan
companles from speclfled forelgn companles Lo be exLended wlLhouL
llmlLaLlon Lo a parLlcular assessmenL year,
8oll 8ack mechanlsm" Lo be provlded ln Lhe AA scheme upLo a perlod noL
exceedlng 4 prevlous years precedlng Lhe flrsL prevlous year for whlch Lhe
AA applles .
lncome arlslng from Lransfer of securlLy by a lorelgn orLfollo lnvesLors Lo
be ln Lhe naLure of caplLal galns.
1ax Deduct|on at Source
1ax Lo be deducLed [2 from Lhe sum pald under llfe lnsurance pollcles
whlch are noL exempLed under secLlon 10(10u). no Lax Lo be deducLed
where Lhe amounL ln aggregaLe exceeds 8s. 1 lakh.
x-x-x