The Income-tax (Second Amendment) Ordinance, 1996

REGISTERED No. DL-33004/96 ,1 i=ldp m, <131'81 $lp~ "aufU nf ~nhla ~ EXTRAORDINARY 'lTT1T II-~ 1 PART II-Section 1 ~ ~ Sli:filf1lld PUBLISHED BY AUTHORITY ~~ NR'll, :tjll{!'Jc.(({, ~ 31, 1996 / ,:fi1f lo, 1918 No. 72] NEW DELHI, TUESDAY, DECEMBER 31, 1996 / PAUSA 10, 1918 0 ~·qrr,lf~1a"Bm§lll~~~~fcf;-~~~~~if~"TT~l Separate paging is given to this Part in order that it may be filed as a separate compilation. MINISTRY OF LAW AND JUSTICE (Legislative Department) New Delhi, the 31st December, 1996/Pausa 10, 1918 (Saka) THE INCOME-TAX (SECO:ND AMENDMENT) ORDINANCE, 1996 No. 32 OF 1996 Promulgated by the President in the Forty-seventh Year of the Republic of India. An Ordinance further to amend the Income-tax Act, 1961. . WHEREAS Parliament is not in session and the President is satisfied that circumstances st which render it necessary for him to take immediate action; Now, THEREFORE, in exercise of the powers conferred by clause(/) of article 123 of e Constitution, the President is pleased to promulgate the following Ordinance:- rdi 1. (]) This Ordinance may be called the Income-tax (Second Amendment) . nance, 1996. rce 0~2~Sat as otherwise provided in this Ordinance, sections 4 to 10 shall cime into ; 2 1 e st ~y ofJanuary, 1997. • ··••· Ille~t; l:~tion. 54EA of the Income-tax Act, 1961 (hereinafter referred to as the >. ), With effect from the 1st day of October, 1996- ;;,ideben~ in sub-_section (}), for the words, brackets, figures and letter "bonds, ,\Votds bes r umts of mutual fund referred to in clause (23D) of section 10,", the ,llllits ~f ;c ets, figures and letter "bonds, debentures, shares of a public company or \~d sha!r :tutual fund referred to in clause (23D) of section 10," shall be substituted ; . deemed to have been substituted; Short title and commence­ ment. Amendment of section 54EA Amendment of section 80G. Amendment of section 158BC. Amendment of section l 58BE. Insertion of new section 158BFA. Levy of Interest and penalty in certain cases. 2 THE GAZETTE OF INDIA EXTRAORDINARY (b) for the words "specified bonds or debentures", wherever th words "specified securities" shall be substituted and shall be deemect ~~ ha .. substituted. v~ 3. In section 8OG of the Income-tax Act, with effect from the 1st day of April •• (a) in sub-section (J), in cluase (i), after the word, brackets, figures ' 19 "sub-clause (iiihd)", the words, brackets, figures and letters "or sub-cla~:d. shall be inserted; ( (b) in sub-section (2), in caluse (a), after sub-clause (iiihd), the fol sub-clause shall be inserted, namely:- 1 "(iiihe) the National Illness Assistance Fund; or". 4. In section 158BC of the Income-tax Act, in clause (a),­ (a) for the words "not being less than fifteen days", the words "not beinj than fifteen days but not more than forty-five days" shall be substituted; • g. (b) after the proviso, the following proviso shall be inserted. namely:- .. "Provided further that a person who has furnished a return und i clause shall not be entitled to file a revised return;". er 5. In section 158BE of the Income-tax Act, for sub-sections (J) and (2), the foll sub-sections shall be substituted, namely:- "(]) The order under section 158BC shall be passed,- (a) within one year from"'the end of the month in which the last ' authorisations for search under section 132 or for requisition under 13 2A, as the case may be, was executed in cases where a search is initia" books of account or other documents or any assets are requisitioned aff 30th day of June, 1995 but before the 1st day of January, 1997; (b) within two years from the end of the month in which the last authorisations for search under section 132 or for requisition under 13 2A, as the case may be, was executed in cases where a search is initia books of account or other documents or any assets are requisitioned on or the 1st day ofJanuary, 1997. ·• (2) The period oflimitation for completion of block assessment in the the other person referred to in section 1588D shall be- (a) one year from the end of the month in which the notice under Chapter was served on such other person in respect of search initiat~ or. of account or other documents or any assets requisitioned after the 30th . June, 1995 but before the 1st day of January, 1997; and (b) within two years from the end of the month in which notice und. Chapter was sen1ed on such other person in respect of search initiated or bo account or other documents or any assets are requisitioned on or after the 1st January, 1997.". 6. After section 158BF of the Income-tax Act, the following section shall be i namely:- " 158BFA. (J) Where the return of total income including undisclosed inco the block period, required by a notice under clause (a) of section 158BC, is fu after the expiry of the period specified in such notice, o:y is not furnished, the ~s 1 shall be liable to pay simple interest at the rate of two per cent. of the tax on undi: income, determined under clause (c) oCsection l58BC, for every month or P_ g month comprised in the period commencing on the day immediately followin; expiry of the time specified in the notice, and- • (a) where the return is furnished after tl1e e,-.1)iry of the time aforesaid, e on the date of furnishing the return; or • • f sses (b) where no return has been furnished on the date of completion° a under cluase (c) of section 158BC. THE GAZETTE OF INDIA EXTRAORDINARY 3 . Assessing Officer or the Commissioner (Appeals) in the course of any (2) The d r this Chapter, may direct that a person shall pay by way of penalty a procee~ngs unll :ot be less than the amount of tax leviable but which shall not exceed suJ11 wmch sha amount of tax so leviable in respect of the undisclosed income determined threetirnes the officer under clause (c) of section l 58BC: Assessing bY thc .d d that no order imposing penalty shall be made in respect of a person provr e if- h person has furnished a return under clause (a) of section 158BC; (i) sue ii) the taX payable on the basis of such return has ?een paid or: if the as~ets . _M/consist of money, the assessee offers the money so seized to be ad Justed agamst SCl:tNU the taX payable; . . . . (iii) evidence of tax paid 1s furrnshed along with the return; and (iv) an appeal is not filed against the assessment of that part of income which is shown in the return: Provided further that the provi~ions of the prece~ding provi~o ~hall not apply • the undisclosed income deterrnmed by the Assessmg Officer rs m excess of the ~here e shown in the return and in such cases the penalty shall be imposed on that m::n ofundisclosed income determined which is i_n excess of the amount ofundisclosed ~ "th tur • income shown Ill e re n. (3) No order imposing a penalty under sub-section (2) shall be made,- . (a) unless an assessee has been given a reasonable opportunity of being heard; (b) by the Assistant Commissioner or Assistant Director, as the case may be, where the amount of penalty exceeds twenty thousand rupees except with the previous approval of the Deputy Commissioner or Deputy Director, as the case may be; (c) in a case where the assessment is the subject-matter of an appeal to the Commissioner (Appeals) under section 246 or an appeal to the Appellate Tribunal under section 253, after the expiry of the financial year in which the proceedings, in the course of which action for the imposition of penalty has been initiated, are completed, or six months from the end of the month in which the order of the vUrurn~~~,,urnc;, (Appeals) or, as the case may be, the Appellate Tribunal is received by the Chief Commissioner or Commissioner, whichever period expires later; (d) in a case where the assessment is the subject matter of revision under 263, after the expiry of six months from the end of the month in which such of revision is passed; (e) in any case other than those mentioned in items (c) and (d), after the expiry financial year in which the proceedings, in the course of which action for the !!.%~,_,'51'ti,111 f ••• 0 penalty has been initiated, are completed, or six months from the end month in which action for imposition of penalty is initiated, whichever period ...... ,rn,~,M later. In computing the period of limitation for the purpo·se of this (i)_the time taken in giving an opportunity to the assessee to be reheard under proviso to section 129· (ii) the period durin~ which the immunity granted under section 245H reifiained and (iii) the period d • · · an ord . . unng which the proceedings under sub..:section (2) are stayed { .. _· er or llljunction of any court, • shalt be excluded. (i ~ncome~tax authority on making an order under sub-section (2) imposing rd~r~ esths he rs himself an Assessing Officer, shall forthwith send a copy of •. o e Assessing Officer.". Substitution of ne\V section for section l 58BG. Authority competent to make the block assessment. Amendment of section 246 .. Amendment of section 253. Insertion of new section 276CCC. Failure to furnish return of income in search cases. 4 THE GAZETTE OF INDIA EXTRAORDINARY 7. For section 158BG of the Income-tax Act, the following section shall b ·._ namely:- , esubsti . "_158BG. The order of assessment for th~ block period shall be Pas Assessmg Officer not below the rank of an Assistant Commissioner or sect Director, as the case may be: an Ass Provided. that no such order shall be passed without the previous a .· .. the Deputy Commissioner or the Deputy Director, as the case may be.,,. PProv 8. In section 246 of the Income-tax Act, in sub'.:-section (2), after clause ( -•· following clauses shall be inserted, namely: d), "(da) an order of assessment made by an Assessing Officer under cla section 158BC, in respect of search initiated under section 132 or books 0tse ~c: h d ••• ed d • 1 aceo ot er ocuments or any assets reqms1tlon un er section 32 A, on or after thl day ofjanuary, 1997; (db) an order imposing a' penalty under sub-section ('2) of section 158BF 9. In section 253 of the Income-tax Act, in sub-section(]), for clause (b), thefoUo' clause shall be substituted, namely:- " (b) an order passed by an Assessing Officerunder clause (c) of section 15 in respect of search initiated under section 132 or books of account, other doc or any assets requisitioned under section 132A, after the 30th day of June, 1995 before the 1st day of January, 1997; or". . • '] 10. After section 276CC of the Income-tax Act, the following section shall be· namely: "276CCC. If a person wilfully fails to furnish in due time the return of income which he is required to furnish by notice given under clause (a)' of s ' l 58BC, he shall be punishable with imprisomnent for a term which shall not be_ than three months but which may extend to three years and with fine.". SHANK.AR DAYAL S I K L MOHANP.-. . • L Secy, to the Govt. of PRINTED BY THE MANAGER GOVERNMNT OF _INDIA PRESS (PLU) MINTO ROAD AND plJBLlS THE CONTROLLER OF PUBLICATIONS, NEW DELHI-1996.