Section Text
1) Subject to the provisions of sub-sections (2) and (3), for the assessment year commencing on the 1st day of April, 2003, income tax shall be charged at the rates specified in Part I of the First Schedule and such tax as reduced by the rebate of income tax calculated underChapter VII-Aof theIncome-lax Act, 1961-(43 of 1961) (hereinafter referred to as the Income tax Act) shall be increased by a surcharge for purposes of the Union calculated in each case in the manner provided therein.
(2) In the cases to which Paragraph A of Part I of the First Schedule applies, where the assessee has, in the previous year, any net agricultural income exceeding five thousand rupees, in addition to total income, and the total income exceeds fifty 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 fifty 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 rates specified in 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 fifty 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 the said Paragraph A, as if the net agricultural income as so increased were the total income;
(iii) the amount of income tax determined in accordance with sub-clause (i) shall be reduced by the amount of income tax determined in accordance with sub-clause (ii) and the sum so arrived at shall be the income tax in respect of the total income :
Provided that the amount of income tax so arrived at, as reduced by the amount of rebate of income tax calculated underChapter VIII-A, shall be increased by a surcharge for purposes of the Union calculated in each case in the manner provided in that Paragraph and the sum so arrived at shall be the income tax in respect of the total income.
(3) In cases to which the provisions ofChapter XII-orChapter XII-Aor section 115 JB-or sub-section (1A) ofsection 161-or section 164-or section 164A-or section 167B of the Income tax Act-apply, 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:
Provided that the amount of income tax computed in accordance with the provisions ofsection 112-shall be increased by a surcharge for purposes of the Union as provided in Paragraph A, B, C, D or E, as the case may be, of Part I of the First Schedule :
Provided further that the amount of .income tax computed in accordance with the provisions ofsection 113 - shall be increased by a surcharge for purposes of the Union as provided in Paragraph A, B, C, D or E, as the case may be, of Part III of the First Schedule of the Finance Act of the year in which the search is initiated undersection 132-or requisition is made undersection 132A of the Income tax Act-:
Provided also that in respect of any income chargeable to tax undersections 115A-,115AB-,115AC - ,115ACA- ,115AD -,115B-,115BB -,115BBA-,115BBB-,115E-and115JB of the Income tax Act-, the amount of income tax computed under this sub-section shall be increased by a surcharge for purposes of the Union, calculated at the rate of five per cent of such income tax.
(4) In cases in which tax has to be charged and paid undersection 115-O-or sub- section (2) ofsection 115R of the Income tax Act-, the tax shall be charged and paid at the rate as specified in those sections and shall be increased by a surcharge for purposes of the Union, calculated at the rate of two and one -half per cent of such tax.
(5) In cases in which tax has to be deducted undersections 193-,194-,194A-,194B-,194BB -,194D-and195 of the Income tax Act-, at the rates in force, the deductions shall be made at the rates specified in Part II of the First Schedule and shall be increased, by a surcharge for purposes of the Union, calculated in each case, in the manner provided therein.
(6) In cases in which tax has to be deducted undersections 194C -,194E-,194EE-,194F-,194G-,194H-,194-I-,194J- ,196B-196C-and196D of the Income tax Act-, the deductions shall be made at the rates specified in those sections and shall be increased by a surcharge for purposes of the Union, calculated,-
(a) in the case of every individual, Hindu undivided family, association of persons and body of individuals, whether incorporated or not, at the rate of ten per cent of such tax where the income or the aggregate of such incomes paid or likely to be paid and subject to the deduction exceeds rupees eight hundred and fifty thousand rupees;
(b) in the case of every co-operative society, firm, local authority and company, at the rate of two and one-half per cent of such tax;
(c) in the case of every artificial juridical person referred to in sub-clause (vii) of clause (31) ofsection 2 of the Income tax Act-, at the rate of ten per cent of such tax.
(7) In cases in which tax has to be collected under the proviso tosection 194B of the Income tax Act-, the collection shall be made at the rates specified in Part II of the First Schedule -, and shall be increased, by a surcharge for purposes of the Union, calculated in the manner provided therein.
(8) In cases in which tax has to be collected undersection 206C of the Income- tax Act-, the collection shall be made at the rates specified in that section and shall be increased by a surcharge for purposes of the Union, calculated,-
(a) in the case of every individual, Hindu undivided family, association of persons and body of individuals, whether incorporated or not, at the rate of ten per cent of such tax where the amount or the aggregate of such amounts collected and subject to the collection exceeds rupees eight hundred and fifty thousand rupees;
(b) in the case of every co-operative society, firm, local authority and company, at the rate of two and one-half per cent of such tax;
(c) in the case of every artificial juridical person referred to in sub-clause (vii) of clause (31) ofsection 2 of the Income tax Act-, at the rate of ten per cent of such tax. (9),Subject to the provisions of sub-section (10), in cases in which income tax has to be charged under sub-section (4) ofsection 172-or sub-section (2) of section 174-or section 174A-or section 175-or sub-section (2) of section 176 of the Income- tax Act-or deducted from, or paid on, income chargeable under the head "Salaries" undersection 192-of the said Act or in which the "advance tax" payable underChapter XVII-Cof 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 charged, deducted or computed at the rate or rates specified in Part III of the First Schedule and such tax as reduced by the rebate of income tax calculated under Chapter VIII-A of the said Act shall be increased by a surcharge for purposes of the Union, calculated in each case in the manner provided therein :
Provided that in cases to which the provisions of Chapter XII or Chapter XII-A or section 115JB-or sub-section (1 A) of section 161 or section 164 or section 164A or section 167B-of the Income tax Act apply, "advance tax" shall be computed with reference to the rates imposed by this sub-section or the rates as specified in that Chapter or section, as the case may be:
Provided further that the amount of "advance tax" computed in accordance with the provisions ofsection 112 of the Income tax Act-shall be increased by a surcharge for purposes of the Union as provided in Paragraph A, B, C, D or E, as the case may be, of Part III of the First Schedule:
Provided also that in respect of any income chargeable to tax undersections 115A-,115AB-,115AC - ,115ACA- ,115AD -,115B-,115BB -,115BBA-,115E-and115JB of the Income tax Act-, "advance tax" computed under the first proviso shall be increased by a surcharge for purposes of the Union, calculated,-
(a) in the case of every individual, Hindu undivided family, association of persons and body of individuals, whether incorporated or not, at the rate of ten per cent of "advance tax" where the total income exceeds eight hundred and fifty thousand rupees;
(b) in the case of every co-operative society, firm, local authority and company, at the rate of two and one -half per cent of such "advance tax";
(c) in the case of every artificial juridical person referred to in sub -clause (vii) of clause (31) ofsection 2 of the Income tax Act -, at the rate of ten per cent of such "advance tax".
(10) In cases to which. 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 exceeding five thousand rupees, in addition to total income and the total income exceeds fifty thousand rupees, then, in charging income tax under sub -section (2)ofsection 174 -or section 174A-or section 175 -or sub -section (2) ofsection 176 -of the said Act or in computing the "advance tax" payable underChapter XVII-Cof 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 fifty thousand rupees of the total income but without being liable to tax], only for the purpose of 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 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 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 fifty thousand rupees, and the amount of income tax or "advance tax" shall be determined in respect of the net agricultural income as so increased at the rates specified in the said Paragraph A, as if the net agricultural income were the total income;
(iii) the amount of income tax or "advance tax" determined in accordance with sub-clause (i) shall be reduced by the amount of income tax or, as the case may be, "advance tax" determined in accordance with sub-clause (ii) and the sum so arrived at shall be the income tax or, as the case may be, "advance tax" in respect of the total income :
Provided that the amount of income tax or "advance tax" so arrived at, as reduced by the rebate of income tax calculated under Chapter VIII-A of the said Act, shall be increased by a surcharge for purposes of the Union calculated in each case, in the manner provided therein.
(11) For the purposes of this section and the First Schedule,-
(a) "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, 2003, 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;
(b) "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);
(c) "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;
(d) all other words and expressions used in this section and 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.