Essential conditions to be
fulfilled
What
Location
of undertaking
any zones notified by central government of India
as FTZs.
Export
out of India
Undertaking must export out of India, the articles
or things or computer software manufactured or
produce.
Cont
Undertaking
not to be formed
by the splitting up or the
reconstruction [Sec 10A (2) (ii)]
undertaking shall not be formed by
the splitting up or the reconstruction
of a business already in existence.
Undertaking not to be formed
by transfer of old machinery
[Sec 10A (2) (iii)]
Cont.
Receipt
in India/ Repatriation to
India of convertible foreign
exchange [Sec 10A (3)]
the sale proceeds of the articles or
things or computer software etc
exported out of India must be received
in India and if not received in India,
then must be bought into India, in
convertible foreign exchange within 6
months from the end of relevant
previous year. This period can be
extended by competent authority.
Cont.
Report
Cont.
Undertakings
Cont.
Furnishing
Calculation
u/s 10 A
Total Turn Over
under taking
Example
Cont.
Transfer
of Goods and
Services
where any goods or services held
for purposes of the eligible
business are transferred to any
other business of assessee or
vice-versa. the consideration
shall be recorded in the books of
eligible business at market value
of such goods or services.
Thus
Essential condition to be
fulfilled for EOUs
1.
2.
3.
4.
5.
Cont.
6. Receipt in India/ Repatriation to India of
convertible foreign exchange [Sec 10A (3)]
the sale proceeds of the articles or things or
computer software etc exported out of India must be
received in India and if not received in India, then
must be bought into India, in convertible foreign
exchange within 6 months from the end of relevant
previous year. This period can be extended by
competent authority.
7. Amount of Deduction:
100% of profit and gains from export is allowed as
deduction for 10 consecutive years.
8. Calculation of the profit from exports [Sec 10A
(4)]
Deduction =100% of [Profit of the * Exp Turn Over ]
u/s 10 A
under taking
Total Turn Over
Cont.
Duplication
of deduction not
allowed [Sec 10B (6) (iii)]
undertaking claiming deduction u/s
10B shall not be allowed to claim
any other deduction in relation to
such profits.
Transfer of undertaking in
amalgamation or demerger [Sec
10B (7A)]
No deduction shall be admissible
under this section.
Cont.
Transfer
of Goods and
Services
where any goods or services held
for purposes of the eligible
business are transferred to any
other business of assessee or
vice-versa. the consideration
shall be recorded in the books of
eligible business at market value
of such goods or services.
Example
ABC Ltd Located in is eligible to claim
deduction u/s 10B. The company started
claiming this deduction from A.Y. 2005-06.
the company provides following information:
Export sales = Rs 20,00,000
Domestic sales= Rs 05,00,000
Profit of the business of the undertaking
= Rs 2,00,000
Additional information:
Out of total export sales of Rs 20,00,000, the
co. has bought convertible foreign exchange
of Rs 80,000 within stipulated time.
Eligibility:
1.Industrial undertakings:
It should be established in the
notified backward area
It is not formed by splitting up or
the reconstruction
It is not formed by the transfer of
the old machinery or plant
Industrial undertakings are setup in
north eastern region during 01-041991 to 31-03-2002.
Industrial undertakings setup in J&K
during 1-4-1995 to 31-3-2007
Amount
of deduction: 100% of
the profits and gains of such
business.
Period of deduction: the
deduction is available for a period
of 10 consecutive years.
[80IB (7)]
Cont.
Multiplex
Cont.
Company
Undertakings
engaged in
production or refining of mineral oil
or natural gas from blocks [Sec
80IB (9)]
100% of profit is allowed for the
period of 7 consecutive years.
Cont.
Profits
Cont.
Duplication
of deduction not
allowed [Sec 80IB (6) (iii)]
undertaking claiming deduction u/s
80IB shall not be allowed to claim
any other deduction in relation to
such profits.
Transfer of undertaking in
amalgamation or demerger [Sec
80IB (7A)]
No deduction shall be admissible
under this section.
Cont.
Transfer
of Goods and
Services
where any goods or services held
for purposes of the eligible
business are transferred to any
other business of assessee or
vice-versa. the consideration
shall be recorded in the books of
eligible business at market value
of such goods or services.
Cont.
Eligible
business:
-Carrying on the business of
(a) developing;
(b) operating & maintaining, or
(c) developing, operating & maintaining,
any infrastructure facility.
-Providing telecommunication services
- developing, operating or maintaining
an Industrial park
-Generation or/and distribution of power
-Natural gas distribution.
Tax
Deducted at Source
TDS or best known Tax Deducted at Source is one of the modes of collecting
Salaries [Sec. 192]: u/s 192 (1) any person responsible for paying any
income chargeable under the head salaries (Sec. 15) shall at the time of
payment, deduct income-tax on the amount payable at the average rate of
income tax computed on the basis of rates in force for the financial year.
Employment under more than one employer during relevant previous year.
Relief u/s 89 (1): In case any arrears are paid to an employee working in
any government organization or company, co-operative society, local
authority, university, institutions, association, and he is entitled to relief u/s
89 (1).
Income from other head: a salaried employee can furnish details of his
other income to his employer and employer can deduct tax at source for
such income also.
The employer can allow deduction under different sections according to the
provisions in Income Tax Act.
Every person deducting tax at source must submit returns as prescribed
under the rules by a prescribed date, which is 31st of May of the assessment
year.
In case the employer fails to deduct tax at source or tax is not deducted
according to provisions or after deducting tax it is not deposited it with the
government, such person shall be personally liable for such amount of tax.
[206 C (6)]
Cont.
Surcharge
for TDS.
Sec.193 deals with the deduction of tax at source from
income chargeable be way of Interest on Security .
The person responsible for paying interest on
securities is liable to deduct income tax at the time of
paying the interest.
Interest payable of some securities like government
bonds, gold bonds, insurance schemes, NSC and other
schemes on which interest income is exempted from
income tax, TDS shall not be deducted for these
securities.
Sec.194 deals with the deduction of Tax at source
from dividends paid by an Indian company or a
company which has made prescribed arrangement to
declare and payment of dividends.
Cont.
If
Cont.
For
Companies
By 15th June
- 15% of Advance Tax
By 15th September- 45%of Advance Tax
By 15th December- 75% of Advance Tax
By 15th March- 100%of Advance Tax
By 31st March - Tax on Capital Gains or Casual Incomes
arising after 15Th March, if any.
For Non-Companies
By 15th June - NIL
By 15th September- 30%of Advance Tax
By 15th December- 60% of Advance Tax
By 15th March- 100%of Advance Tax
By 31st March - Tax on Capital Gains or Casual Incomes
arising after 15Th March, if any.
Income-Tax Authorities
(a) the Central Board of Direct Taxes constituted under the Central
Boards of Revenue Act, 1963 (54 of 1963),
(b) Directors-General of Income-tax or Chief Commissioners of Incometax,
(c) Directors of Income-tax or Commissioners of Income-tax or
Commissioners of Income-tax (Appeals),
(cc) Additional Directors of Income-tax or Additional Commissioners of
Income-tax or Additional Commissioners of Income-tax (Appeals),
(cca) Joint Directors of Income-tax or Joint Commissioners of Income-tax.
(d) Deputy Directors of Income-tax or Deputy Commissioners of Incometax or Deputy Commissioners of Income-tax (Appeals),
(e) Assistant Directors of Income-tax or Assistant Commissioners of
Income-tax,
(f) Income-tax Officers,
(g) Tax Recovery Officers,
(h) Inspectors of Income-tax.
Cont.
Cont.
4) Power of Survey:
An Income Tax authority can have a survey for the purpose of
this Act.
The objectives of conducting Income Tax surveys are:
To discover new assessee (s);
To collect useful information for the purpose of assessment;
To verify that the assessee who claims not to maintain any
books of accounts is in-fact maintaining the books;
To check whether the books are maintained, reflect the
correct state of affairs.
Cont.
Cont.
WHO
PENALTIES
Section No.
Default
penalty
140A (3)
Failure to pay any self assessment
assessing officer may
tax or interest or both
exceed amount
of tax.
on each such
Amount of
failure.
As
but not
Rs.10000
271(1) (b)
271(1) (c)
Concealment of income or furnishing Amount between
100% to 300%
incorrect particulars of income
of the
amount of tax evaded.
Or Rs.25000.
271A
Cont.
271C
deducted
Failure to do TDS
271F
Rs.5000
272A(1)
failure
whichever is less.
Rs.10000 on each
Cont.
271B
Rs.10000,
whichever is less.
271C
Failure to do TDS
271F
Rs.5000
272A(1)