| FINANCE ACT, 1975 |
| FINANCE ACT, 1975 25 of 1975 12th May, 1975 An Act to give effect to the financial proposals of the Central Government for the financial year 1975-76 Be it enacted by Parliament in the Twenty-sixth Year of the Republic of India as follows:- SECTION 01: SHORT TITLE AND COMMENCEMENT (1)This Act may be called The Finance Act. 1975. (2) Save as otherwise provided in this Act, Sections 2-to30-shall be deemed to have come into force on the 1st day of April, 1975. SECTION 02: INCOME-TAX (1) Subject to the provisions of sub-sections (2), (3) and (4) for the assessment year commencing on the 1st day of April, 1975, income-tax shall be charged at the rates specified inpart I of the First Schedule and shall be increased,- (a) in the cases to which Paragraphs A, B, C and D of that Part apply, by a surcharge for purposes of the Union; and (b) in the cases to which Paragraphs E and F of that Part apply, by a surcharge, calculated in each case in the manner provided therein. (2) In the cases to which Sub-Paragraph I of Sub-Paragraph II of Paragraph A of Part I of the First Schedule applies, where the assessee has. in the previous year, any net agricultural income, in addition to total income, and the total income exceeds six thousand rupees, then,- (a) the net agricultural income shall be taken into account, in the manner provided in clause (b) (that is to say, as if the net agricultural income were comprised in the total income after the First six thousand rupees of the total income but without being liable to tax), only for the purpose of charging income-tax in respect of the total income, and (b) the income-tax chargeable shall be calculated as follows:-- (i) the total income and the net agricultural income shall be aggregated and the amount of income-tax shall be determined in respect of the aggregate income at the rate specified in Sub-Paragraph I or, as the case may be, Sub-Paragraph II of the said Paragraph A, as if such aggregate income were the total income; (ii) the net agricultural income shall be increased by a sum of six thousand rupees and the amount of income-tax shall be determined in respect of the net agricultural income as so increased at the rates specified in Sub-Paragraph I or, as the case may be, Sub-Paragraph II of the said Paragraph A, as it the net agricultural income as so increased were the total income; (iii) the amount by which income-tax determined in accordance with sub-clause (i) exceeds the amount of income-tax determined in accordance with sub-clause (ii) shall be the income-tax chargeable in respect of the total income. (3) Where in the case of a company, other than the Life Insurance Corporation of India established under the Life Insurance Corporation Act 1956. the total income includes any profits and gains from life insurance business, the income-tax payable by it shall be the aggregate of the income-tax calculated- (i) on the amount of profits and gains from life insurance business so included, at the rate applicable in the case of the Life Insurance Corporation of India, in accordance with Paragraph E of Part I of the First Schedule, to that part of its total income which consists of profits and gains from life insurance business; and (ii) on the remaining part of its total income, at the rate applicable to the company on its total income. (4) In cases to which Chapter XII or section 164 of the Income-tax Act 1961-(hereinafter referred to as the Income-tax Act) applies, the tax chargeable shall be determined as provided in that Chapter or that section, and with reference to the rates imposed by sub-section (1) or the rates as specified in that Chapter or section, as the case may be. (5) In cases in which tax has to be deducted under sections 193-,194-,194A-.194B(6) Subject to the provisions of sub-section (7), in cases in which income-tax has to be calculated under the first proviso to sub-section (5) of section 132 of the Income-tax Act-or charged under sub-section (4) of section 172-or sub-section (2) of section 174-orsection 175-or sub-section (2) of section 176-of the said Act or deducted under section 192-of the said Act from income chargeable under the head "Salaries" or deducted under sub-s. (9) of S. 80E of the said Act from any payment referred to in the said sub-section (9) or in which the "advance tax" payable under Chapter XVII-C of the said Act has to be computed, at the rate or rates in force, such income tax or, as the case may be, "advance tax" shall be so calculated, charged, deducted or computed at the rate or rates specified in Part III of the First Schedule: Provided that in respect of any income chargeable to tax under section 164 of the Income-tax Act-at the rate of sixty-five per cent., "advance tax" shall be computed at that rate. (7) In the cases to which Sub-Paragraph I or Sub-Paragraph II of Paragraph A of Part III of the First Schedule applies, where the assessee has, in the previous year or, if by virtue of any provision of the Income-tax Act, income-tax is to be charged in respect of the income of a period other than the previous year, in such other period, any net agricultural income, in addition to total income, and the total income exceeds six thousand rupees, then, in calculating income-tax under the First proviso to sub-section (5) of section 132 of the Income-tax Act-or in charging income-tax under sub-section (2) of section 174-orsection 176-or sub-section (2) of section 176-of the said Act or in computing the "advance tax" payable under Chapter XVII-C of the said Act, at the rate or rates in force,- (a) the net agricultural income shall be taken into account, in the manner provided in clause (b) (that is to say, as if the net agricultural income were comprised in the total income after the First six thousand rupees of the total income but without being liable to tax), only for the purpose of calculating, charging or computing such income-tax or, as the case may be, "advance tax" in respect of the total income; and (b) such income-tax or, as the case may be, "advance tax" shall be so calculated, charged or computed as follows :-- (i) the total income and the net agricultural income shall be aggregated and the amount of income-tax or "advance tax" shall be determined in respect of the aggregate income at the rates specified in Sub-Paragraph I or, as the case may be, Sub-Paragraph II of the said Paragraph A, as if such aggregate income were the total income; (ii) the net agricultural income shall be increased by a sum of six thousand rupees and the amount of income-tax or "advance tax" shall be determined in respect of the net agricutural income as so increased at the rates specified in Sub-Paragraph I or, as the case may be Sub-Paragraph II of the said Paragraph A, as if the net agricultural income as so increased were the total income; (iii) the amount by which income-tax or, as the case may be, "advance tax" determined in accordance with sub-clause (i) exceeds the amount of income-tax or "advance tax" determined in accordance with sub-clause (ii) shall be the income-tax or "advance tax" in respect of the total income. (8) For the purposes of this section and the First Schedule,- (a) "company in which the public are substantially interested" means a company which is such a company as if referred to in section 108 of the Income-tax Act-; (b) "domestic company" means an Indian company, or any other company which, in respect of its income liable to income-tax under the Income-tax Act for the assessment year commencing on the 1st day of April, 1975, has made the prescribed arrangements for the declaration and payment within India of the dividends (including dividends on preference shares) payable out of such income in accordance with the provisions of section 194-of that Act; (c) "industrial company" means a company which is mainly engaged in the business of generation or distribution of electricity or any other form of power or in the construction of ships or in the manufacture or processing of goods or in mining. (d) "insurance commission" means any remuneration or reward, whether by way of commission or otherwise, for soliciting or procuring insurance business (including business relating to the continuance, renewal or revival of policies of insurance), (e) "net agricultural income", in relation to a person, means the total amount of agricultural income, from whatever source derived, of that person computed in accordance with the rules contained in Part IV of the First Schedule': (f) "tax-free security" means any security of the Central Government issued or declared to be income-tax free, .or any security of State Government issued income-tax free, the income-tax whereon is payable by the State Government; (g) all other words and expressions used in this section or in the First Schedule but not defined in this sub-section and defined in the Income-tax Act shall have the meanings, respectively, assigned to them in that Act. SECTION 03: 3-24 -- made amendments to Ss. 10-,32-,33A-,40A-,43-52-,80C-,80FF-,80J-,80K-,80M-80QQ-,172-,194A-,195- Ninth Schedule: and inserted new sections44B-,80JJ-,80RRA-& Tenth Schedule and substituted S. 106: section 24 made consequential amendments in certain sections of the I.-T. Act. All these incorporated in the Income-tax Act subject to subsequent amendments made and hence not printed here--Ed. SECTION 25: 25-28 - Amendments incorporated in the Wealth-tax Act, 1957. SECTION 29: AMENDMENT OF ACT 18 OF 1958. S.4 - [Incorporated in the Principal Act] SECTION 30: AMENDMENT OF ACT 20 OF 1974 - [Incorporated in the principal Act] SECTION 31: AUXILIARY DUTIES OF CUSTOMS (1) In the case of goods mentioned in the First Schedule to Indian Tariff Act,1934 (hereinafter referred to as the Tariff -Act) or in that Schedule as amended from time to time, there shall be levied and collected as an auxiliary duty of customs an amount equal to twenty percent, of the value of the goods a. determined in accordance with the provisions of section 14 of Customs Act, 1962-(hereinafter referred to as the Customs Act.) (2) Sub-section (i) shall cease to have effect after the 30th day of June, 1976 except as respects things done or omitted to be done before such cesser: ands ection 6 of the General Clauses Act. 1897(3) The auxiliary duties of customs referred to in sub-section (1) shall be in addition to any duties of-customs chargeable on such goods under the Customs Act, or any other law for the time being in force. (4) The provisions of the Customs Act, and the rules and regulations made thereunder including those relating to refunds and exemptions: from duties, shall, as far as may be, apply in relation to the levy and collection of the auxiliary duties of customs leviable under this section in respect of any goods as they apply in relation to the levy and collection of the duties of customs on such goods under that Act or those rules and regulations, as the case may be. SECTION 32: AMENDMENT OF ACT 1 OF 1949 - (Since repealed.) SECTION 33: AMENDMENT OF ACT 1 OF 1944 - Already incorporated in the principal Act printed in Vol. 2. SECTION 34: AUXILIARY DUTIES OF EXCISE (1) In the case of goods mentioned in the First Schedule to the Central Excises Act-, or in that Schedule as amended from time to time, there shall be levied and collected as an auxiliary duty of excise an amount equal to twenty per cent. of the value of the goods as determined in accordance with the provisions of section 4 of the Central Excises Act-. (2) Sub-section (1) shall cease to have effect after the 30th day of June, 1976, except as respects things done or omitted to be done before such cesser. And section 6 of the General Clauses Act, 1897-, shall apply upon such cesser as if the said sub-section had then been repealed by a Central Act. (3) The auxiliary duties of excise referred to in sub-section (1) shall be in addition to any duties of excise chargeable on such goods under the Central Excises Act, or any other law for the time being in force. (4) The auxiliary duties of excise leviable under sub-section (1) in the financial year 1975- 76 shall be for the purposes of the Union and the proceeds thereof shall not be distributed among the States and the auxiliary duties of excise leviable under sub-section (1) in the financial year 1976-77 shall, for the purposes of section 2 of the Union Duties of Excise (Distribution)Act. 1962.be deemed to be auxiliary duties of excise levied and collected under the Finance Act of the financial year 1976-77 and the provisions of the 1962 Act, aforesaid shall apply accordingly. (5) The provisions of the Central Excises Act and the rules made the reunder, including those relating to refunds and exemptions from duties shall, as far as may be, apply in relation to the levy and collection of the auxiliary duties of excise leviable under this section in respect of any goods as they apply in relation to the levy and collection of the duties of excise on such goods under that Act or those rules, as the case may be. SECTION 35: AMENDMENT OF ACT 58 OF 1957 - (Incorporated in the Act.) SECTION 36: DISCONTINUANCE OF SALT DUTY - For the year beginning on the 1st day of April, 1975, no duty under the Central Excises Act or the Tariff Act shall be levied in respect of salt manufactured in, or imported into. India. SECTION 37: SPECIAL PROVISIONS AS TO DUTIES OF EXCISE ON SKELP (1) Notwithstanding any judgment, decree or order of any court, in all Central laws, providing for or relating to the levy on iron or steel products of duties of excise, as in force during or at any time during the period commencing with the appointed day and ending with the 28th day of February 1975- (I) and reference to strips shall be construed as including and as having always included skelp as defined in Explanation 2 unless such Central law excluded, expressly or by necessary implication, skelp from strips; and (II) any reference to skelp shall be construed as having and having always had the meaning assigned to it in Explanation 2, and accordingly- (a) ail duties of excise levied, assessed or collected or purporting to have been levied, assessed or collected on skelp, as defined in Explanation 2, under any such Central law shall be deemed to be as validly levied, assessed or collected as if the provisions of this section had been in force at all material times when such duties of excise were levied, assessed or collected; (b) no suit or other proceeding shall be maintained or continued in any court for the refund of, and no enforcement shall be made by any court of any decree or order directing the refund of, any such duties of excise which have been collected and which would have been validly collected if the provisions of this section had been in force at all material times when such duties were collected', (c) refund shall be made of all such duties of excise which have been collected but which would not have been collected if the provisions of this section had been in fore at all material times when such duties were collected; and (d) recoveries shall be made of all such duties of excise which have not been collected but which would have been collected if the provisions of this section had been in force as from the appointed day. (2) For the removal of doubts, it is hereby declared that no act or omission on the part of any person shall be punishable as an offence which would not have been so punishable if this section had not come into force. SECTION 38: AMENDMENT OF ACT 74 OF 1956 - (Incorporated in the Act.) SCHEDULE 01: (Seesection 2-)PART I INCOME-TAX AND SURCHARGE ON INCOME-TAX Paragraph A Sub-Paragraph I In the case of every individual or Hindu undivided family or unregistered firm or other association of persons or body of individuals, whether incorporated or not. or every artificial juridical person referred to in sub-clause (vii) of cl. (31) ofsection 2 of the Income-tax Act-. not being a case to which Sub-Paragraph II of this Paragraph or any other Paragraph of this Part applies, - Rates of income-tax (1) where the total income does not exceed Nil, Rs. 6,000 (2) where the total income exceeds Rs. 6,000 12 per cent of the amount by which the total income hut does not exceed Rs. 10,000 exceeds Rs. 6,000 (3) where the total income exceeds Rs. 10,000 Rs. 480 plus 15 per cent. of the amount by which but does not exceed Rs. 15,000 the total income exceeds Rupees 10000. (4) where the total income exceeds Rs. 15,000 Rs. 1,230 plus 20 per cent. of the amount by which but docs not exceed Rs. 20.000 the total income exceeds Rupees 15,000: (5) where the total income exceeds Rs. 20.000 Rs. 2,230 plus 30 per cent. of the amount by which but does not exceed Rs. 25.000 the total income exceeds Rupees 20.000: (6) where the total income exceeds Rs. 25.000 Rs. 3.730 plus 40 per cent. of the amount by which but docs not exceed Rs. 30,000 the total income exceeds Rupees 25.000: (7) where the total income exceeds Rs. 30.000 Rs. 5,730 plus 50 per cent. of the amount by which But does not exceed Rs. 50.000 the total income exceeds rupees 30.000: (8) where the total income exceeds Rs. 50.000 Rs. 15,730 plus 60 per cent. of the amount by which but does not exceed Rs. 70,000 the total income exceeds Rupees 50.000. (9) where the total income exceeds Rs. 70.000 Rs. 27.730 plus 70 per cent. of the amount by which the total income exceeds Rupees 70.000: Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall be increased by a surcharge for purposes of the Union calculated at the rate of ten per cent. of such income-tax. Sub-Paragraph II In the case of every Hindu undivided family which at any time during the previous year has at least one member whose total income of the previous year relevant to the assessment year commencing on the 1st day of April. 1975, exceeds Rs. 6,000- Rates of income-tax (1) where the total income does not exceed Nil; Rs. 6.000 (2) where the total income exceeds Rs. 6,000 15 per cent of the amount by which the total income but does not exceed Rs. 10.000 exceeds Rs. 6.000 (3) where the total income exceeds Rs. 10,000 Rs. 600 plus 20 per cent. of the amount by which but does not exceed Rs. 15,000 the total income exceeds Rupees 10.000: (4) where the total income exceeds Rs. 15,000 Rs. 1,600 plus 30 per cent. of the amount by which but does not exceed Rs. 20,000 the total income exceeds Rupees 15.000. (5) where the total income exceeds Rs. 20.000 Rs. 3.100 plus 40 per cent. of the amount by which but does not exceed Rs. 25.000 the total income exceeds Rupees 20.000: (6) where the total income exceeds Rs. 25,000 Rs. 5,100 plus 50 per cent. of the amount by which but does not exceed Rs. 30,000 the total income exceeds Rupees 25.000: (7) where the total income exceeds Rs. 30.000 Rs. 7.600 plus 60 per cent. of the amount by which but does not exceed Rs. 50,000 the total income exceeds rupees 30.000: (8) where the total income exceeds Rs. 50.000 Rs. 19.600 plus 70 per cent. of the amount by which the total income exceeds Rupees 50,000: Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall he increased by a surcharge for purposes of the Union calculated at the rate of ten per cent of such income-tax. paragraph B In the case of every co-operative society,- Rates of income-tax (1) where the total income does not exceed 15 per cent, of the total income; Rs. 10.000 (2) where the total income exceeds Rs. 10,000 Rs. 1,500 plus 25 per cent. of the amount by which but does not exceed Rs. 20.000 the total income exceeds Rupees 10,000. (3) where the total income exceeds Rs 20,000 Rs. 4,000 plus 40 per cent of the amount by which the total income exceeds Rupees 20,000 Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Paragraph shall he increased by a surcharge tor purposes of the Union calculated at the rate of ten per cent. of such income-tax. Paragraph C Sub-Paragraph I !n the case of every registered firm, not being a case to which Sub-Paragraph II of this Paragraph applies,- Rates of income-tax (1) where the total income does not exceed Nil, Rs. 10000 (2) where the total income exceeds Rs. 10.000 5 per cent of the amount by which the total income but does not exceeds Rs. 25,000 exceeds Rs. 10,000; (3) where the total income exceeds Rs. 25.000 Rs. 750 plus 7 per cent. of the amount by which but does not exceed Rs. 50,000 the total income exceeds Rs. 25,000; (4) where the total income exceeds Rs. 50,000 Rs. 2.500 plus 15 per cent of the amount by which but does not exceed Rs. 1,00,000 the total income exceeds Rs. 50.000; (5) where the total income exceeds Rs. 1,00,000 Rs. 10,000 plus 25 per cent of the amount by which the total income exceeds Rs. 1,00,000. Surcharge on Income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall be increased by a surcharge for purposes of the Union calculated at the rate of ten per cent. of such income-tax. Sub-Paragraph II In the case of every registered firm whose total income includes income derived from a profession carried on by it and the income so included is not less than fifty-one per cent. of such total income.--- Rates of income-tax (1) where the total income does not exceed Nil; Rs 10,000 (2) where the total income exceeds Rs. 10.000 4 per cent of the amount by which the total income but does not exceeds Rs. 25,000 exceeds Rs. 10,000: (3) where the total income exceeds Rs. 25,000 Rs. 600 plus 7 per cent. of the amount by which but does not exceed Rs. 50.000 the total income exceeds Rs. 25,000; (4) where the total income exceeds Rs. 50.000 Rs. 2.350 plus 13 per cent of the amount by which but docs not exceed Rs 1.00,000 the total income exceeds Rs. 50.000: (5) where the total income exceeds Rs. 1,00.000 Rs. 8.850 plus 22 per cent of the amount by which the total income exceeds Rs. 1.00.000. Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall be increased by a surcharge for purposes of the Union calculated at the rate of ten per cent. of such income-tax. Explanation.-- For the purposes of this Paragraph, "registered firm" includes an unregistered firm assessed as a registered firm under Cl. (b) ofSec. 183 of the Income-tax Act.-Paragraph D In the case of every local authority. - Rate of income-tax On the whole of the total income 50 per cent. Surcharge on incornc-tax The amount of income-lax computed at the rate hereinbefore specified shall be increased by a surcharge for purposes of the Union calculated at the rate of ten per cent. of such income-tax. Paragraph E In the case of the life Insurance Corporation of India established under the Life Insurance Corporation Act. 1956.- Rates of Income-tax (i) on that part of its total income which 52.5 per cent.: consists of profits and gains from life insurance business (ii) on the balance, if any. of the total the rate of income-tax applicable in accordance with income Paragraph f of this Part to the total income of a domestic company which is a company in which the public are substantially interestd Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Pragraph shall he increased by a surcharge calculated at the rate of five per cent. of such income-lax. Paragraph F In the case of a company, other than the Life Insurance Corporation of India established under the Lite Insurance Corporation Act. 1956.- Rates of Income-tax 1. In the case of a domestic company,--- (1)where the company is a company in which the public are substantially interested.- (i) in a case where the total income 45 per cent. of the total income: does not exceed Rs. 1,00.000 (ii)in a case where the total income 55 per cent. of the total income: exceeds Rs. 1.00.000 (2)where the company is not a company in which the public are substantially interested,- (i)in the case of an industrial company (a) on so much of the total 55 per cent income as does not exceed Rs. 2.00,000 ' (b) on the balance, if any. of the 60 per cent: total income (ii) in any other case 65 per cent. of' the total income: Provided that the income -tax payble by a domestic company, being a company in which the public are substantially interested. the total income of which exceeds Rs 1,00.000. shall not exceed the aggregate of --- (a) the income -tax which would have been payable by the company if its total income had been Rs. 1.00.000 (the income of' Rs. 1.00,000 for this purpose being computed as if such income included income from various sources in the same proportion as the total income of the company); and (b) cighty per cent of the amount by which its total income exceeds Rs. 1,00.000. II. In the case of a company other than a domestic company --- (i) on so much of the total income as consists of --- (a) royalties received from an Indian concern in pursuance of .in agreement made hy it with the Indian concern after the 31st day of March. 1961. or (b) tecs for rendering technical services received from an Indian concern in pursuance of an agreement made by it with the Indian concern after the 29th day of February 1964. and where such agreement has. in either case. been 50 per cent. approved by the Central Government (ii) on the balance, if any. of the total income 70 per cent.: Surcharge on income-tax The amount of income tax computed in accordance with the preceding provisions of this Paragraph shall he increased by a surcharge calculated at the rate of five per cent. of such income-tax.PART IIRates for dedection of tax at source in certain cases In every case in which under the provisions ofsections 193-.194194A-.194B194D-and195 of the Income-tax Act-. tax is to he deducted at the rates in force, deduction shall he made from the income subject to deduction at the following rates --- Income-lax Rate of income-tax Rate of surcharge 1 In the case of a person other than a company --- (a) where the person is resident - (i) on income by way of interest 10 per cent Nil. other than "Interest on securities" (ii) on income by way of winnings 30 per cent 30 Per cent . from lotteries and cross-word puzzles (iii) on income hy way of insurance 10 per cent Nil . commission (iv) on any other income (excluding 21 per cent. 2 per cent.; interest payable on a tax-free security) (b) where the person is not resident in India- (i) on the whole income (excluding income-tax at 30 per cent. and surcharge at 3 per interest payable on a tax-free cent. of the amount of the income security) or income-tax and surcharge on income-tax in respect of the income at the rates prescribed in Sub- Paragraph I of Paragraph A of Part III of this Schedule, if such income had been the total income, whichever is higher; (ii) on income by way of interest 15 per cent. 1.5 per cent. payable on a tax-free security 2. In the case of a company -- (a) where the company is a domestic company-- (i) on income by way of interest 20 per cent. 1 per cent.; other than "Interest on securities" (ii) on any other income (excluding 22 per cent. 1 per cent.; interest payable on a tax free security) (b) where the company is not a domestic company - (i) on income by way of dividends 24.5 per cent 1.225 per cent.; payable by any domestic company (ii) on income by way of royalties 50 per cent. 2.5 per cent. payable by an Indian concern in pursuance of an agreement made by it with the Indian concern after the 31st day of March, 1961 and which has been approved by the Central Government (iii) on income by way of fees payable by an Indian concern for rendering technical services in pursuance of an agreement made by it with the Indian concern after the 29th day of February. 1964. and which has been approved by the Central Government. (iv) on income by way of interest 70 per cent . 3.5 per cent. payable on a tax-free security (v) on any other income 44 per cent. 2.2 per cent.;PART IIIRates for calculating or charging income-tax in certain cases, deducting income-tax from income chargeable under the head "Salaries" or any payment referred to in -sub-section (9) ofsection 80E-and computing "advance-tax" In cases in which income-tax has to be calculated under the first proviso to sub-section (5) ofsection 132 of the Income-tax Act-or charged under sub-sec. (4) ofsection 172-or sub-section (2) ofsection 174-orsection 175-or sub-section (2) ofsection 176-of the said Act or.deducted undersection 192-of the said Act from income chargeable under the head "Salaries" or deducted under sub-section (9) ofsection 80E-of the said Act from any payment referred to in the said sub-section (9) or in which the "advance- tax" payable under Chapter VII-C of the said Act has to be computed, at the rate or rates in force, such income-tax or. as the case may be, "advance tax" (not being "advance tax" in respect of any income chargeable to tax undersection 164 of the Income-tax Act-at the rate of sixty five per cent.) shall be so calculated, charged, deducted or computed at the following rate or rates : Paragraph A Sub-Paragraph I In the case of every individual family or Hindu undivided family or unregistered firm or other association of persons or body of individuals, whether incorporated or not. or every artificial juridical person referred to in sub-clause (vii) of cl. (31) ofsection 2 of the Income-tax Act-, not being a case to which Sub-Paragraph II of this Paragraph or any other Paragraph of this Part applies,- Rates of income-tax (1) where the total income does not exceed Nil; Rs. 6.000 (2) where the total income exceeds Rs. 6,000 12 per cent of the amount by which the total income but does not exceed Rs. 10.000 exceeds Rs. 6.000 (3) where the total income exceeds Rs. 10,000 Rs. 480 plus 15 per cent. of the amount by which but does not exceed Rs. 15,000 the total income exceeds Rs. 10.000, (4) where the total income exceeds Rs. 15.000 Rs. 1,230 plus 20 per cent. of the amount by which but does not exceed Rs. 20.000 the total income exceeds Rs. 15,000: (5) where the total income exceeds Rs. 20,000 Rs. 2,230 p!us 30 per cent. of the amount by which but does not exceed Rs. 25,000 the total income exceeds Rs. 20,000: (6) where the total income exceeds Rs. 25.000 Rs. 3.730 plus 40 per cent. of the amount by which but does not exceed Rs. 30,000 the total income exceeds Rs. 25,000: (7) where the total income exceeds Rs. 30,000 Rs. 5,730 plus 50 per cent. of the amount by which but does not exceed Rs. 50,000 the total income exceeds Rs. 30,000: (8) where the total income exceeds Rs. 50,000 Rs. 15,730 plus 60 per cent. of the amount by which but does not exceed Rs. 70.000 the total income exceeds Rs. 50,000; (9) where the total income exceeds Rs. 70,000 Rs. 27,730 plus 70 per cent. of the amount by which the total income exceeds Rs. 70,000: Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall be increased by a surcharge for purposes of the Union calculated at the rate of ten per cent of such income-tax. Sub-Paragraph II In the case of every Hindu undivided family which at any time during the previous year has at least one member whose total income of the previous year relevant to the assessment year commencing on the 1st day of April, 1976. exceeds Rs. 6,000- Rates of income-tax (1) where the total income does not exceed Nil: Rs. 6,000 (2) There the total income exceeds Rs. 6,000 15 per cent of the amount by which the total income but does not exceed Rs. 10,000 exceeds Rs. 6,000 (3) where the total income exceeds Rs. 10.000 Rs. 600 plus 20 per cent. of the amount by which but does not exceed Rs. 15.000 the total income exceeds Rs. 10.000: (4) where the total income exceeds Rs. 15,000 Rs. 1,600 plus 30 per cent of the amount by which but does not exceed Rs. 20.000 the total income exceeds Rs. 15,000; (5) where the total income exceeds Rs. 20.000 Rs. 3,100 plus 40 per cent. by the amount by which but does not exceed Rs. 25000 the total income exceeds Rs. 20.000. (6) where the total income exceeds Rs. 25.000 Rs. 5,100 plus 50 per cent. of the amount by which but does not exceed Rs. 30,000 the total income exceeds Rs. 25.000; (7) where the total income exceeds Rs. 30.000 Rs. 7.600 plus 50 per cent of the amount by which but does not exceed Rs. 50.000 the total income exceeds Rs. 30,000. (8) where the total income exceeds Rs. 50.000 Rs. 19,600 plus 70 per cent of the amount by which the total income exceeds Rs. 50.000: Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall he increased by a surcharge lor purposes of the Union calculated at the rate of ten per cent of such income-tax. Paragraph B In the case of every co-operative society.-- Rates of income-tax (1) where the total income does not exceed 15 per cent. of the total income. Rs. 10.000 (2) where the total income exceeds Rs. 10.000 Rs. 1.500 plus 25 per cent. of the amount by which but does not exceed Rs. 20.000 the total income exceeds Rs. 10,000. (3) where the total income exceeds Rs. 20.000 Rs. 4.000 plus 40 per cent. of the amount by which the total income exceeds Rs. 20,000 Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Paragraph shall beincreased by a surcharge for purposes of the Union calculated at the rate of ten per cent of such income-tax. Paragraph C' Sub-Paragraph I In the case of every registered firm. not being a case to which Sub-Paragraph II of this Paragraph applies .-- Rates of income-tax (1) where the total income does not exceed Nil: Rs. 10.000 (2) where the total income exceeds Rs. 10.000 5 per cent of the amount hy which the total income But does not exceed Rs. 25.000 exceeds Rs. 10.000: (3) where the total income exceeds Rs. 25.000 Rs 750 plus 7 per cent of the amount by which but does not exceed Rs. 50.000 the total income exceeds Rs 25,000: (4) where the total income exceeds Rs. 50.000 Rs 2.500 plus 15 per cent of the amount by which but does not exceed Rs. 1.00.000 the total income exceeds Rs 50.000: (5) where the total income exceeds Rs. 1,00,000 Rs 10.000 plus 24 per cent of the amount by which the total income exceeds Rs. 1,00,000. Surcharge on Income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall be increased by a surcharge for purposes of the Union calculated at the rate of ten per cent. of such income-tax. Sub-Paragraph II In the case of every registered firm whose total income includes '. income derived from a profession carried on by it and the income so included is not less than fifty-one per cent of such total income.-- Rates of income-tax (1) where the total income does not exceed Nil: Rs. 10.000 (2) where the total income exceeds Rs. 10.000 4 per cent of the amount by which the total income but does not exceed Rs. 25.000 exceeds Rs. 10,000. (3) where the total income exceeds Rs. 25.000 Rs. 600 plus 7 per cent. of the amount by which but does not exceed Rs. 50.000 the total income exceeds Rs. 25,000, (4) where the total income exceeds Rs. 50.000 Rs. 2.350 plus 13 per cent. of the amount by which but does not exceed Rs. 1.00.000 the total income exceeds Rs. 50.000: (5) where the total income exceeds Rs. 1,00,000 Rs. 8,850 plus 22 per cent. of the amount by which the total income exceeds Rs. 1.00.000. Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Sub-Paragraph shall be increased by a surcharge for purposes of the Union calculated at the rate of ten per cent. of such income-tax. Explanation.-'- For the purposes of this Paragraph, "registered firm" includes an unregistered firm assessed as a registered firm under clause, (b)ofsection. 183. of the Income-tax ActParagraph D In the case of every local authority- Rate of income -tax On the:whole of the total income- 50 per cent. Surcharge on income -tax The amount of income-tax computed tax the rate hereinbefore specified shall beincreased by a surcharge for purposes of the Union calculated at the rate of ten per cent. of such income-tax. Paragraph E . In the case of the Life Insurance Corporation of India established under the Life Insurance Corporation Act. 1956.- Rates of Income-Tax (i) on that part of its total income which 52.5 per cent., consists of profits and gains from life insurance business (ii)on the balance, if any of the total the-rate of income-tax applicable in accordance income with Paragraph F of this Part. to the total income of a domestic company which is a company in which the public are substantially interested. Surcharge on income -tax The amount of income-tax computed in accordance with the preceding provisions of this Paragraph shall be increased by a surcharge calculated at the rate of five per cent. of such income-tax. Paragraph F In the case of a company, other .than the Life Insurance Corporation of India established under the Life Insurance Corporation Act. 1956 , Rates of income-tax 1. In the case of a domestic company- (1) where the company is a company in which the public are substantially interested,- (i) in a case where the total income 45 per cent of the total income. does not exceed Rs. 1,00,000 (ii) in a case where the total income 55 per cent of the total income exceeds Rs. 1,00,000 (2) where the company is not a company in which the public are substantially interested,-- (i) in the case of an industrial company --- (a) where he total income- does 55 per cent of the total income; not exceed Rs. 2,00,000 (b) where the total income 60 per cent of the total income exceeds Rs. 2.00,000 (ii) in any other case 65 per cent of the total income, Provided that-"-- (i) the income-tax payable by a domestic company, being a company in which the public are substantially interested, the total income of which exceeds Rs. 1,00.000. shall not exceed the aggregate of - (a) the income-tax which would have been payable by the company if its total income had been Rs. 1,00,000 (the income of Rs. 1.00,000 for this purpose being computed as if such income included income from various sources in the same proportion as the total income of the company); and (b) eighty per cent. of the amount by which its total income exceeds Rs. 1,00,000; (ii) the income-tax payable by a domestic company, not being a company in which the public are substantially interested, which is an industrial company and the total income of which exceeds Rs. 2, 00,000 shall not exceed the aggregate of- (a) the income-tax which would have been payable by the company if its total income had been Rs. 2.00,000 (the income of Rs. 2,00.000 for this purpose being computed as if such income included income from various sources in the same proportion as the total, income of the company); and (b) eighty per cent. of the amount by which its total income exceeds Rs. 2,00,000. II. In the case of a company other than a domestic company- (i) on so much of the total income as consists of - (a) royalties received from an Indian concern in pursuance of an agreement made by it with the Indian concern after the 31st day of March, 1961. or (b) fees for rendering technical services received from an Indian concern in pursuance of an agreement made by it with the Indian concern after the 29th day. of February, .1964, and where such agreement has, in either case, been 50 per cent.: approved by the Central Government (ii) on the balance, if any. of the total income 70 per cent.; Surcharge on income-tax The amount of income-tax computed in accordance with the preceding provisions of this Paragraph shall be increased by a surcharge calculated at the rate of five per cent. of such income-tax.PART IV [SeeSection 2 (8) (e)-] RULES FOR COMPUTATION OF NET AGRICULTURAL INCOME RULE 01: - Agricultural income of the nature referred to in sub-clause (a) of clause (1) ofsection 2 of the Income-tax Act-shall be computed as if it were income chargeable to income-tax under that Act under the head "Income from other sources" and the provisions ofsections 57-to59-of that Act shall, so far as may be, apply accordingly: Provided that sub-section (2) ofsection 58-shall apply subject to the modification that the reference tosection 40A-therein shall be construed as not including a reference to sub-sections (3) and (4) ofsection 40A- RULE 02: - Agricultural income of the nature referred to in sub-clause (b) or sub-clause (c) of clause (1) ofsection 2 of the Income-tax Act-[other than income derived from any building required as a dwelling house by the receiver of the rent or revenue or the cultivator or the receiver of rent-in-kind referred to in the said sub-clause (c)] shall be computed as if it were income chargeable to income-tax under that Act under the head "Profits and gains of business or profession" and the provisions ofsections 30-31-,32-34-,36-,37-,38-,40-40A-[other than sub-sections (3) and (4) thereof]. 41, 43 and 43A of the Income- tax Act shall, so far as may be. apply accordingly. RULE 03: - Agricultural income of the nature referred to in sub-clause (c) of clause (1) ofsection 2 of the Income-tax Act- being income derived from arry building require as a dwelling house by the receiver of the rent or revenue or the cultivator or the receiver of rent-in-kind referred to in 'the said sub-cl, (c) shall be computed.as if it were income chargeable to income-tax under that Act under the head "Income from house properly' and the provisions ofsections 23-to27-of that Act shall, so far as may be. apply accordingly : Provided that sub-section (2) of the saidsection 23-shall apply subject to the modifications that the references to "total income" therein shall be construed as references to net agricultural income and that the words, figures and letter "and before making any deduction under Chapter VIA" shall be omitted. RULE 04: - Notwithstanding anything contained in any other provisions of these rules, in a case where the assessee derives income from sale of tea grown and manufactured by him in India, such income shall be computed in accordance with rule 8 of the Income-tax Rules. 1962, and sixty per cent. of such income shall be regarded as the agricultural income of the assessee. RULE 05: - Where the assessee is a partner of a registered firm or an unregistered firm assessed as a registered firm under clause (b) ofsection 183 of the Income-tax Act-, which in the previous year has any agricultural income, or is a partner of an unregistered firm which has not been assessed as a registered firm under clause (b) of the said section 183 and which in the previous year has either no income chargeable to tax under the Income-tax Act or has total income not exceeding the maximum amount not chargeable to tax in the case of an unregistered firm but has any agricultural income then. the agricultural income or loss of the firm shall be computed .in accordance with these rules and his share in the agricultural income or loss of the firm shall be computed in the manner laid down in sub-section (1), sub-s. (2) and sub- section (3) ofsection 67 of the Income-tax Act-and the share so computed shall be regarded as the agricultural income or loss or the assessee. RULE 06: - Where the assessee is a member of an association of persons or a body of individuals (other than a Hindu undivided family, a company or a firm) which in the previous year has either no income chargeable to tax under the Income-tax Act or has total income not exceeding the maximum amount not chargeable to tax in the case of an association of persons or a body of individuals (other than a Hindu undivided family, a company or a firm) but has any agricultural income, then. the agricultural income or loss of the association or body shall be computed in accordance with these rules and the share of the assessee in the agricultural income or loss so computed shall be regarded as the agricultural: income or loss of the assessee. RULE 07: - Where the result of the computation for the previous year in respect of any source of agricultural income is a loss, such loss shall be set off against the income of the assessee, if any, for that previous year from any other source of agricultural income : Provided that where the assessee is a partner of an unregistered firm which has not been assessed as a registered firm under clause (b) ofsection 183 of the Income-tax Act-or is a member of an association of persons or body of individuals and the share of the assessee in 'the agricultural income of the firm, association or body. as the case may be. is a loss. such loss shall not be set off against any income of the assessee from any other source of agricultural income. RULE 08: - Any sum payable by the assessee on account of any tax levied by the State Government on the agricultural income shall be deducted in computing the agricultural income. RULE 09: (1) Where the assessee has, in the previous year relevant to the assessment year commencing on the 1st day of April, 1975 any agricultural income and the net result of the computation of the agricultural income of the assessee for the previous year relevant to the assessment year commencing on the 1st day of April, 1974 is a loss. then. lor the purposes of sub-section (2) ofsection 2-of this Act, the loss so computed shall be set off against the agricultural income of the assessee for the previous year relevant to the assessment year commencing on the 1st day of April. 1975. (2) Where the assessee has. in the previous year relevant to the assessment year commencing on the 1st day of April. 1976 or. if by virtue of any provision of the Income-tax Act. income-tax is to be charged in respect of the income of a period other than that previous year. in such other period any agricultural income and the net result of the computation of the agricultural income of the assessee for the previous year relevant to the assessment year commencing on the 1st day of April. 1974 or the 1st day of April. 1974, or both. is a loss then. for the purposes of sub-section (7) ofsection 2-of this Act - (i) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April, 1974. to the extent, if any such loss has not been set off against the agricultural income for the previous year relevant to the assessment year commencing on the 1st day of April, 1975. and (ii) the loss so computed for the previous year relevant to the assessment year commencing on the 1st day of April. 1975 shall be set off against the agricultural income of the assessee for the previous year relevant to the assessment year commencing on the 1st day of April. 1976 or the period aforesaid. (3) Where a change has occurred in the constitution of a firm, nothing in sub-rule (1) or sub-rule (2) shall entitle the firm to set oft so much of the loss proportionate to the share of a retired or decease' partner computed in the manner laid down in sub-section (1). sub-section (2) and sub-section (3) of section 67 of the Income-tax Act as exceeds his share of profits, if any. of the previous year in the firm or entitle any partner to the benefit of any portion of the said loss (computed in the manner aforesaid) which is not apportionable to him. (4) Where any person deriving any agricultural income from any source has been succeeded in such capacity by another person, otherwise than by inheritance, nothing in sub-rule (1) or sub-rule (2) shall entitle any person, other than the person incurring the loss. to have it set off under sub-rule (1) or, as the case may be. sub-rule (2). (5) Notwithstanding anything contained in this rule, no loss which has not been determined by the Income-tax Officer under the provisions of these rules, or the rules contained in Part IV of the first Schedule to the Finance Act. 1974. shall he set off under sub-rule (1) or. as the case may be. sub-rule (2) RULE 10: -- Where the net result of the computation made in accordance with these rules is a loss: the loss so computed shall be ignored and the net agricultural income shall be deemed to be nil. RULE 11: - The provisions of the Income-tax Act relating to procedure for assessment (including the provisions ofsection 288A-relating to rounding off of income) shall, with the necessary modifications apply in relation to the computation of the net agricultural income of the assessee as they apply in relation to the assessment of the total income. RULE 12: - For the purposes of computing the net agricultural income of the assessee. the Income tax Officer shall have the same powers as he has under the Income-tax Act tor the purposes of assessment of the total income. |
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