Application for allotment of New PAN (Form 49A) for India Citizens wef 08.04.2012

With effect from April 8, 2012, PAN applications are required to be furnished in the new forms prescribed by ITD. Indian citizens will have to submit their 'Application for allotment of new PAN' in revised Form 49A only. Foreign citizens will have to submit their 'Application for allotment of new PAN' in newly notified Form 49AA only.

With effect from April 1, 2012, fees for PAN application has changed to Rs. 96. (For dispatch outside India Rs. 962).

For New PAN applications, in case of Individual and HUF applicants if Address for Communication is selected as Office, then Proof of Office Address along with Proof of residential address is to be submitted to NSDL w.e.f. applications made on and after 1st November 2009.

As per RBI guidelines, the entities making e-commerce transactions are required to provide PIN (Personal Identification Number) while executing an online transaction. Accordingly, before making payment for online PAN/TAN applications using credit/debit card, please ensure that the PIN is obtained from your respective Banks.

This form should be used when the applicant has never applied for a PAN or does not have PAN allotted to him. An applicant can visit Income Tax Department (ITD) website to find whether a PAN has been allotted to him or not.

We have added the following Information in this Article

•  Guidelines to make Application in Form 49A for allotment of New PAN
• Instructions to make Application in Form 49A for allotment of New PAN
• Documents to be Submitted
• Do's and Don'ts
• Link to Apply Online

Guidelines

1. STEPS FOR ONLINE APPLICATION

a.	Only Indian citizens should use this form for submitting application for allotment of PAN. Indian citizens located outside India should also use this form.
b.	Applicant will fill Form 49A online and submit the form.
c.	If the data submitted fails in any format level validation, a response indicating the error(s) will be displayed on the screen.
d.	The applicant shall rectify the error(s) and re-submit the form.
e.	If there are no format level error(s), a confirmation screen with data filled by the applicant will be displayed.
f.	The applicant may either edit or confirm the same.

2. PAYMENT

g.	If communication address is within India, then the fee for processing PAN application is  Rs. 96.00 ( Rs. 85.00 + 12.36% service tax). Payment can be made either by

Demand Draft
Cheque
Credit Card / Debit Card
Net Banking

If any of addresses i.e. office address or residential address is a foreign address, the payment can be made only by way of demand draft payable at Mumbai.h.If communication Address is outside India, then the fee for processing PAN application is  rs. 962.00 [(Application fee  rs. 85.00 + Dispatch Charges  rs. 771.00) + 12.36% service tax]. Payment can be made only by Demand Draft payable at Mumbai.

At present this facility is available for a select list of countries. Applicants from other countries may contact NSDL at the contact details given in point (5) below.i.Demand draft / cheque shall be in favour of 'NSDL – PAN'. Demand draft should be payable at Mumbai.j.Name of the applicant and the acknowledgment number should be mentioned on the reverse of the demand draft / cheque.k.Applicants making payment by cheque shall deposit a local cheque (drawn on any bank) with any HDFC Bank branch across the country (except Dahej). The applicant shall mention NSDL-PAN on the deposit slip.l.Credit card / Debit card / Net banking payment – Persons authorised to make Credit card / Debit card / Net banking payment are as below:

Category of Applicant	Payment by Credit Card / Debit Card / Net Banking can be made by / for
Individual	Self, immediate family members (parents, spouse, children)
HUF	Karta of the HUF
Company	Any Director of the Company
Firm/ Limited Liability Partnership	Any Partner of the Firm
Association of Person(s) / Body of Individuals / Association of Person(s) Trust / Artificial Juridical Person / Local Authority	Authorised Signatory covered under section 140 of Income Tax Act, 1961

Applicants making credit card / debit card payment will be charged an additional surcharge of Rs. 5.00 + service tax by the bank providing payment gateway facility.
Applicants making payment through Net Banking facility will be charged an additional surcharge of  rs. 4.00 + service tax for payment gateway facility.

	On successful credit card / debit card / net banking payment, acknowledgment will be displayed. Applicant shall save and print the acknowledgment and send it to NSDL as mentioned in point 'u – Mode of Submission of Documents' below.
m.	Applicant shall select appropriate mode of payment and fill relevant details in the application.

3. ACKNOWLEDGMENT

n.	On confirmation, and in case of credit card / debit card / net banking payment (on successful payment), an acknowledgment screen will be displayed. The acknowledgment consists of:

A 15-digit unique acknowledgment number
Category of applicant
Name of applicant
Father's Name (in case of 'Individual')
Date of Birth/Incorporation/Agreement/Partnership or Trust Deed/Formation of Body of Individuals/Association of Persons
Address for Communication
Representative Assessee's name and address
Space for Photograph (in case of 'Individual')
Payment Details
Space for Signature
Aadhaar No.
Details of Proof of Identity and Addresso.Applicant shall save and print this acknowledgment.p.'Individual' applicants making "Application for allotment of new PAN" should affix two recent colour photographs (3.5 cm x 2.5 cm) in the space provided in the acknowledgment. The photograph should not be stapled or clipped to the acknowledgment. (The clarity of the image on PAN card will depend on the quality and clarity of the photograph affixed on the form).q.Signature / Left hand thumb impression should be provided across the photo affixed on the left side of the acknowledgement in such a manner that portion of signature/impression is on photo as well as on acknowledgement receipt.r.The signature should not be on the photograph affixed on right side of the acknowledgement. If there is any mark on this photograph such that it hinders the clear visibility of the face of the applicant, the application will not be accepted.s.Signature / left thumb impression should only be within the box provided in the acknowledgment. The signature should not be on the photograph. If there is any mark on the photograph such that it hinders the clear visibility of the face of the applicant, the application will not be accepted.t.Thumb impression, if used, should be attested by a Magistrate or a Notary Public or Gazetted Officer, under official seal and stamp.

4. MODE OF SUBMISSION OF DOCUMENTS

u.	The acknowledgment duly signed, affixed with photographs (in case of 'Individuals') along with Demand Draft/cheque, if any, and proof of identity (name in the application should be same as in the proof of identity) & proof of address (Individuals, HUFs, Body of Individuals, Association of Persons & Artificial Juridical Person should provide proof of address of residence stated in the application) as specified in the application form is to be sent to NSDL at 'Income Tax PAN Services Unit, National Securities Depository Limited, 3rd floor, Sapphire Chambers, Near Baner Telephone Exchange, Baner, Pune – 411045′.
v.	In case, AADHAAR is mentioned in the application (applicable for Individuals only), then the copy of AADHAAR allotment letter should also be enclosed along with the acknowledgement
w.	Superscribe the envelope with 'APPLICATION FOR PAN-Acknowledgment Number' (e.g. 'APPLICATION FOR PAN-881010200000097′).
x.	Your acknowledgment, demand draft/cheque, if any, and proofs, should reach NSDL within 15 days from the date of online application.
y.	Applications received with demand draft or cheque as mode of payment shall be processed only on receipt of relevant proofs and realisation of payment.
z.	Applications received with credit card / debit card / net banking as mode of payment shall be processed on receipt of relevant documents (acknowledgment and proofs).

5. CONTACT US

For more information

Call TIN Call Centre at 020 – 27218080

Fax: 020-27218081

E-mail us at: tininfo@nsdl.co.in

SMS NSDLPAN < space > Acknowledgement No. & send to 57575 to obtain application status

Write to: INCOME TAX PAN SERVICES UNIT (Managed by National Securities Depository Limited),
3rd floor, Sapphire Chambers, Near Baner Telephone Exchange, Baner, Pune – 411045

Instructions for Filling Form 49A

• This form is applicable for Indian citizens only. Indian citizens who are located outside India should also submit application for allotment of PAN in Form 49A only.
• Form to be filled in English only.
• Fields marked by asterisk (*) are mandatory.
• The applicant shall leave a blank space after each word/number/punctuation mark in a field.
• Those already allotted a ten-digit alphanumeric PAN shall not apply again as having or using more than one PAN is illegal. However, request for a new PAN card with the same PAN or/and changes or correction in PAN data can be made by filling up the form for 'Request for New PAN Card or/and Changes or Correction in PAN Data'.
• AO code (Area Code, AO Type, Range Code and AO Number) of the Jurisdictional Assessing Officer must be filled up by the applicant. These details can be obtained either from the Income Tax Office or an applicant can search for the same by selecting the appropriate option using the details provided in the form.

1. Full Name

Please select appropriate title.

Individuals must state full expanded name. Do not use abbreviations and initials.

Allowed two characters initials in surname, first name, middle name & father's name of applicant are mentioned below.

AH

AI

AL

AN

AO

AR

AS

BE

BI

BO

BP

CH

CY

DA

DE

DO

EE

EK

EM

ES

FA

FE

FK

FU

GI

GO

GU

HA

HE

HU

HO

ID

IK

IL

IN

JE

JI

JO

JR

JU

KA

KC

KE

KH

KI

KJ

KO

KS

KU

LE

LI

LO

LU

MA

MU

NA

NG

OH

OM

ON

PI

PT

QI

RU

SA

SE

SI

SM

SU

TA

TI

TO

TU

UR

UL

WO

WU

YE

YH

YI

YJ

YO

YU

ZI

For example RAVIKANT should be written as:

Last Name/ Surname

R

A

V

I

K

A

N

T

First Name

Middle Name

For example SURESH SARDA should be written as:

Last Name/ Surname

S

A

R

D

A

First Name

S

U

R

E

S

H

Middle Name

For example POONAM RAVI NARAYAN should be written as:

Last Name/ Surname

N

A

R

A

Y

A

N

First Name

P

O

O

N

A

M

Middle Name

R

A

V

I

For example SATYAM VENKAT M. K. RAO should be written as:

Last Name/ Surname

R

A

O

First Name

S

A

T

Y

A

M

Middle Name

V

E

N

K

A

T

M

K

For example M. S. KANDASWAMY (MADURAI SOMASUNDRAM KANDASWAMY) should be written as:

Last Name/ Surname

K

A

N

D

A

S

W

A

M

Y

First Name

M

A

D

U

R

A

I

Middle Name

S

O

M

A

S

U

N

D

R

A

M

Applicants other than 'Individuals' may ignore above instructions.

Non-Individuals should write their full name starting from the first block of Last Name/Surname. If the name is longer than the space provided for the last name, it can be continued in the space provided for First and Middle Name.

For example XYZ DATA CORPORATION (INDIA) PRIVATE LIMITED should be written as:

Last Name/ Surname

X

Y

Z

D

A

T

A

C

O

R

P

O

R

A

T

I

O

N

(

I

N

D

First Name

I

A

)

P

R

I

V

A

T

E

L

I

M

I

T

E

D

Middle Name

For example MANOJ MAFATLAL DAVE (HUF) should be written as:

Last Name/ Surname

M

A

N

O

J

M

A

F

A

T

L

A

L

D

A

V

E

(

H

U

F

)

First Name

Middle Name

In case of Company, the name should be provided without any abbreviations. For example, different variations of 'Private Limited' viz. Pvt Ltd, Private Ltd, Pvt Limited, P Ltd, P. Ltd., P. Ltd are not allowed. It should be 'Private Limited' only.

In case of sole proprietorship concern, the proprietor should apply for PAN in his/her own name.

Name should not be prefixed with any title such as Shri, Smt, Kumari, Dr., Major, M/s etc.

2. Abbreviations of the above name, as you would like it, to be printed on the Card

Individual applicants should provide full/abbreviated name to be printed on the PAN card. Name, if abbreviated, should necessarily contain the last name.

For example SATYAM VENKAT M. K. RAO which is written in the Name field as:

Last Name/ Surname

R

A

O

First Name

S

A

T

Y

A

M

Middle Name

V

E

N

K

A

T

M

K

Can be written as in 'Name to be printed on the PAN Card' column as

SATYAM VENKAT M. K. RAO   or

S. V. M. K. RAO    or

SATYAM V. M. K. RAO

For non individual applicants, this should be same as last name field in item no. 1 above.

Name you would like printed on the card should not be prefixed with titles such as Shri, Smt, Kumari, Dr., Major, M/s etc.

3. Have you ever been Known by Any Other Name?

If applicant selects 'Yes', then it is mandatory to provide details of the other name. Instructions in Item No. 1 with respect to name apply here. Title should be similar to the title mentioned in Item No. 1.

4. Gender

This field is mandatory for Individuals. Field should be left blank in case of other applicants.

5. Date of Birth / Incorporation / Agreement / Partnership or Trust Deed / Formation of Body of Individuals / Association of Persons

Date cannot be a future date.

Date 2^nd August 1975 should be written as

DD	MM	YYYY
0  2	0  8	1  9  7  5

Relevant date for different category of applicants is:

• Individual: Actual Date of Birth;
• Company: Date of Incorporation;
• Association of Persons: Date of formation/creation;
• Trusts: Date of creation of TrustDeed;
• Partnership Firms: Date of Partnership Deed;
• LLPs: Date of Incorporation/Registration;
• HUFs: Date of creation of HUF and for ancestral HUF date can be 01-01-0001 where the date of creation is not available.

6. Father's Name

• Applicable to Individuals only. Instructions in Item No.1 with respect to name apply here.
• Married women applicants should give only father's name and not husband's name.
• Father's Name should not be prefixed with titles such as Shri, Smt, Kumari, Dr., Major, M/s etc.

7. Address – Residential and Office

R – Residential Address:

• It is mandatory for Individuals / HUF / Body of Individuals / Association of Persons and Artificial Juridical Person to mention residential address and provide proof of the same. The name of applicant mentioned in the application should match with the name displayed in the proof of address.
• Out of first four fields, applicant must fill up at least two fields.
• Town/City/District, State/Union Territory and PIN are mandatory.
• If the applicant wants to enter foreign address here, option for "outside India" should be selected from the drop down list in the field of "State/Union Territory". Applicant should select the name of the country and enter the ZIP code as applicable. Country name and Zip code are mandatory.
• Applicants other than Individuals / HUF / Body of Individuals / Association of Persons and Artificial Juridical Person will leave this field (Residential address) blank.

O – Office Address:

• In case of Individuals / HUF / Body of Individuals / Association of Persons and Artificial Juridical Person, if Item No.6 (Address for Communication) is selected as "O" then Office Address is mandatory.
• Office name and address is mandatory in case of Individuals having source of income as salary & business/profession.
• In case of Firm, Company, Local Authority and Association of Persons (Trust), name of office and address is mandatory.
• For all categories of applicants, out of first four fields, at least two fields are mandatory.
• Town/City/District, State/Union Territory and PIN are mandatory.
• If the applicant wants to enter foreign address here, option for "outside India" should be selected from the drop down list in the field of "State/Union Territory". Applicant should select the name of the country and enter the ZIP code as applicable. Country name and Zip code are mandatory.
• If applicant is engaged in a business / profession [falling under codes 9, 10, 12, 13, 15, 17 to 20 - refer Item No. 13(b)] and the area code mentioned is MUM, then it is mandatory to provide office address.
• In case of Individual and HUF if Item No.6 (Address for Communication) is selected as "O" then Proof of Office Address along with Proof of residential address is mandatory w.e.f. applications made on and after 1st November 2009.

8. Address for Communication

'R' means Residence and 'O' means Office.

All future communication will be sent at the address indicated in this field.

9. Telephone Number and e-mail ID

Telephone number should include country code(ISD code) and STD code or Mobile No. should include Country code(ISD Code).

For example

Telephone number 23555705 of Delhi should be written as

Country code					STD Code				Telephone Number / Mobile number
	9	1				1	1		2	3	5	5	5	7	0	5

Where '91' is the country code of India and 11 is the STD Code of Delhi.

Mobile number 9102511111 of India should be written as

Country code					STD Code				Telephone Number / Mobile number
	9	1							9	1	0	2	5	1	1	1	1	1

Where '91′ is the country code of India.

NRI /Foreign National should mention the ISD code of their respective country and City code as applicable in the space provided for ISD & STD code. e. g. Person staying in Chicago should write A1 in the ISD code and 312 in STD code text box. (A1 is ISD code of USA and 312 is City code of Chicago).

It is mandatory for the applicants to mention either their "Telephone number" or valid "e-mail id" so that they can be contacted in case of any discrepancy in the application and/or for receiving PAN through e-mail.

Application status updates are sent using the SMS facility on the mobile numbers mentioned in the application form (applicable only for Indian mobile numbers).

• It is suggested that applicants mention their telephone number so that they can be contacted in case of any discrepancy in the application form.
• Applicants must provide their valid e-mail ID for receiving PAN through e-mail.

10. Status of Applicant

This field is mandatory for all categories of applicants.In case of 'Limited Liability Partnership', the PAN will be allotted in 'Firm' status.

11. Registration Number

Not applicable to Individuals and HUFs. Mandatory for 'Company'. Company should mention registration number issued by the Registrar of Companies. Other applicants may mention registration number issued by any State or Central Government Authority.

12. In case of a Citizen of India, then (AADHAAR)

AADHAAR number, if allotted, has to be quoted.A copy of AADHAAR allotment letter/card has to be provided as Proof of AADHAAR, if the AADHAAR is mentioned in the application.

13. Source of Income

It is mandatory to indicate at least one of the sources of incomes, as mentioned in the form. In case, the income from Business/profession is selected by the applicant then an appropriate business/ profession code should be mentioned.

Please refer the table given below to select the business/profession code:

Code	Business/ Profession	Code	Business/ Profession
01	Medical Profession and Business	11	Films, TV and such other entertainment
02	Engineering	12	Information Technology
03	Architecture	13	Builders and Developers
04	Chartered Accountant/Accountancy	14	Members of Stock Exchange, Share Brokers and Sub-Brokers
05	Interior Decoration	15	Performing Arts and Yatra
06	Technical Consultancy	16	Operation of Ships, Hovercraft, Aircrafts or Helicopters
07	Company Secretary	17	Plying Taxis, Lorries, Trucks, Buses or other Commercial Vehicles
08	Legal Practitioner and Solicitors	18	Ownership of Horses or Jockeys
09	Government Contractors	19	Cinema Halls and Other Theatres
10	Insurance Agency	20	Others

14. Name and address of Representative Assessee

• Section 160 of Income Tax Act, 1961 provides that any assessee can be represented through Representative Assessee.
• Therefore, this column should be filled in by representative assessee only as specified in Section 160 of the Income-tax Act, 1961, such as, an agent of the non-resident, guardian or manager of a minor, lunatic or idiot, Court of Wards, Administrator General, Official Trustee, receiver, manager, trustee of a Trust including Wakf.
• This field will contain particulars of the Representative Assessee. This field is mandatory if applicant is minor, deceased, idiot, lunatic or mentally retarded. Column 1 to 13 will contain details of person on whose behalf this application is submitted.
• Proof of Identity and Proof of Address has to be submitted for the Representative Assessee details mentioned.
• Foreign Non-Individual entities having no office of their own in India may additionally mention their own name and care of address of their tax consultant in India in this column for the purpose of communication address. This should be supported by Power of Attorney in favour of the tax consultant duly notarised or attested by Indian Embassy/High Commission or Consulate located in the country.
• Name of Representative Assessee should not be prefixed with titles such as Shri, Smt, Kumari, Dr., Major, M/s etc.

15. Proof of Identity and Address

• Select appropriate proof of identity and address from the relevant drop-down list provided in the form.
• Documents submitted should be in the name of the applicant as mentioned in item no. 1 of the application form.
• In case of minor, proofs of any of the parents or guardian shall be deemed to be the proof of identity and address.
• For HUF, an affidavit made by the Karta of Hindu Undivided Family stating name, father's name and address of all the coparceners on the date of application and copy of Proof of Identity and Proof of Address documents in the name of Karta of HUF is required.

16. Other Details: Depository Account

If applicant selects 'copy of depository account' as proof of identity or proof of address, it is mandatory to fill in Depository Account Details.

17. Payment Details

An applicant has an option of making payment either by demand draft, cheque, Credit Card / Debit Card or Net Banking (Payment details are mentioned in guidelines).

18. Signature/ Left Thumb Impression

Application must be signed by (i) the applicant; or (ii) Karta in case of HUF; or (iii) Director of a Company; or (iv) Authorised Signatory in case of AOP, Body of Individuals, Local Authority and Artificial Juridical Person; or (v) Partner in case of Firm/LLP; or (vi) Trustee; or (vii) Representative Assessee in case of Minor/deceased/idiot/lunatic/mentally retarded.

It is mandatory to provide Verifier's name, capacity and place in the application.

Documents to be Submitted

For Individuals

• Individual applicants should provide proof of residential address.
• If the applicant is a minor (i.e. below 18 years of age at the time of application), any of the documents as per the lists specified below of any of the parents/ guardian of such minor shall be deemed to be the proof of identity and address of the applicant.

1. Citizen of India Located in India at the Time of Application for PAN

Proof of Identity

Copy of any of the following:

• School leaving certificate
• Matriculation certificate
• Degree of a recognised educational institution
• Depository account statement
• Credit card statement
• Bank account statement/ bank pass book
• Water bill
• Ration card
• Property tax assessment order
• Passport
• Voters Identity Card
• Driving License
• Certificate of identity signed by Member of Parliament or Member of Legislative Assembly or Municipal Councilor or Gazetted Officer.

Proof of AddressCopy of any of the following:

• Electricity bill*
• Telephone bill*
• Depository account statement*
• Credit card statement*
• Bank account statement/bank pass book*
• Rent receipt*
• Employer certificate*
• Passport
• Voters Identity card
• Property tax assessment order
• Driving License
• Ration card
• Certificate of address signed by Member of Parliament or Member of Legislative Assembly or Municipal Councilor or Gazetted Officer.

* documents submitted as proof of address for serial numbers 1 to 7 should not be more than six months old from the date of application.

2. Citizen of India Located Outside India at the Time of Application for PAN

Proof of Identity

Copy of Passport

Proof of Address

Copy of any of the following

• Copy of passport
• Copy of bank account statement in country of residence
• Copy of NRE bank account statement **

3. Foreign Citizen Located in India at the Time of Application for PAN

Proof of Identity

Copy of any of the following

• Copy of passport
• Copy of Person of Indian Origin (PIO) card issued by Government of India

Proof of Address

Copy of any of the following

• Copy of passport
• Copy of bank account statement in India
• Residential permit issued by the State Police Authorities
• Registration certificate issued by the Foreigner's Registration Officer
• Copy of Person of Indian Origin(PIO) card issued by Government of India
• Copy of NRE bank account statement**

4. Foreign Citizen Located Outside India at the Time of Application for PANProof of Identity

• Copy of passport
• Copy of other National ID attested by Indian Embassy/Consulate/High Commission/Apostille
• Copy of Person of Indian Origin(PIO)card issued by Government of India

Proof of AddressCopy of any of the following

• Copy of passport
• Copy of other National ID attested by Indian Embassy/Consulate/High Commission/Apostille
• Copy of bank account statement in country of residence, duly attested by Indian Embassy/High Commission/Consulate/Apostille in the country where applicant is located
• Copy of Person of Indian Origin (PIO) card issued by Government of India
• Copy of NRE bank account statement**
• ** showing at least two customer induced transactions in last six months
• period and duly attested by Indian Embassy / Consular office / Highcommission or
• Apostille or by the manager of the bank in which the account is held. The applicant may be a joint holder.

For Categories other than Individuals
i.e. Firm, BOI, HUF, AOP, AOP(Trust), Local Authority, Company, Artificial Juridical Person

1. Having Office of their Own in India

Proof of Identity and Address

• HUF : Any document prescribed in the case of individuals in respect of Karta of the HUF.
• Company : Copy of Certificate of Registration issued by Registrar of Companies.
• Firms : Copy of Certificate of Registration issued by Registrar of Firms or Copy of Partnership Deed.
• AOP (Trusts) : Copy of Trust Deed or Copy of Certificate of Registration issued by Charity Commissioner.
• AOP/BOI/Local Authority/Artificial Juridical Person : Copy of Agreement or Copy of Certificate of Registration issued by Charity Commissioner or Registrar of Co-operative Society or any other Competent Authority or any other document originating from any Central or State Government Department establishing identity and address of such person.

2. Having No Office of their Own in India

Proof of Identity and Address

Copy of any of the following

• Copy of registration certificate of the respective country duly attested by Indian Embassy/ Consulate/ High Commission/ Apostille in the country where applicant is located.
• Copy of certificate of registration with the competent authority in India.
• Copy of approval issued by the competent authority in India.
• Copy of the accompanying documents alongwith the approval issued by competent authority in India.
• Copy of the application (duly acknowledged) made by the applicant before the competent authority in India.

Do's and Don'ts

DOs

• Do use ' Form 49A' for making application for allotment of PAN.
• Do fill the application in block letters in English and preferably with black ink.
• Do paste a recent colour photograph (size 3.5 cm X 2.5 cm).
• Do provide the signature within the box.
• If thumb impression is put on the application form, do get the thumb impression attested by Magistrate or a Notary Public or a Gazetted Officer, under official seal and stamp.
• Do provide correct AO code in the application.
• Do specify AO code as below if applicant is a defence employee
  Army – PNE W 55 3
  Navy – MUM W 11 8
  Air Force – DEL W 72 2
• Do attach Proof of Identity (POI) and Proof of Address (POA) as per Rule 114 (4) of Income Tax Rules, 1962.
• Do provide the POI and POA which have name exactly as written in the application.
• Do provide details of Representative Assessee in column 14 of application form, if applicant is Minor, Idiot, Lunatic or Deceased.
• Do provide POI and POA for Representative Assesse also, if Representative Assessee is appointed.
• Do write the complete postal address in the application with landmark.
• Do mention correct pin code in the address field.
• Do mention telephone number / e- mail id in the application.

Don'ts

• Do not overwrite or make corrections in the application.
• Do not pin or staple the photograph.
• Do not sign across the box (i.e. signature should be within the box)
• Do not provide POI and POA which are not in the name of the applicant.
• Do not write any additional details (date, designation, rank, etc.) along with the signature in the box.
• Do not mention Husband's name in the Father's Name column.
• Do not abbreviate your name or do not use initials.
• Do not apply for a new PAN if you already have one.

For further assistance :

• Call TIN Call Centre at 020 – 27218080
• e-mail us at:  tininfo@nsdl.co.in
• For tracking the Status of application log on to https://tin.tin.nsdl.com/pan/index.html
• Write to: National Securities Depository Limited, 3rd floor, Sapphire Chambers, Near Baner Telephone Exchange, Baner Pune – 411045
• SMS NSDLPAN <space> Acknowledgment No. & send to 57575 to obtain application status.

Online Application for New PAN

CHANGE IN THE PROVISIONS FOR FILING OF RETURN OF INCOME

CHANGE IN THE PROVISIONS FOR FILING OF RETURN OF INCOME

(1)  An individual or HUF must file the return of income electronically for the previous year 2011-12 and subsequent previous year if his/its total income exceeds Rs. 10 lakhs.

(2)  A resident Individual or a resident HUF must file the return of income electronically for the previous year 2011-12 and subsequent previous year, if he/it has:

(a)  assets (including financial interest in any entity) located outside India; or

(b)  signing authority in any account located outside India.

(3)  The prescribed ITR Form SAHAJ – ITR 1 cannot be used by a resident Individual to file his return of income, if he has:

(a)  assets (including financial interest in any entity) located outside India; or

(b)  signing authority in any account located outside India.

(4)  The Form SUGAM – ITR 4S, prescribed in the case of an individual or a HUF deriving business income and such income is computed in accordance with special provisions referred to in section 44AD and section 44AE of the Act, cannot be used by a resident Individual or a resident HUF to file the return of income, if he/it has:

(a)  assets (including financial interest in any entity) located outside India; or

(b)  signing authority in any account located outside India.

Source:taxmann

CURRENT ACCOUNT DEFICIT DOUBLES TO $19.6 b in Q3

CURRENT ACCOUNT DEFICIT DOUBLES TO $19.6 b in Q3

Widening trade deficit and slowdown in capital inflows are weighing down India's key macroeconomic indicators.

The country's current account deficit (CAD) jumped to 4.3 per cent of GDP in the October-December 2011 period (Q3) against 2.3 per cent in the corresponding year-ago period.

Current account deficit occurs when a country's total imports of goods, services and transfers exceed exports, making it a net debtor to the rest of the world.

In absolute terms, the current account deficit has widened to $19.6 billion in the reporting Q3 against $10.1 billion in Q3 of 2010-11.

According to economists, a widening deficit will weaken the rupee which, in turn, will have an inflationary impact (India imports almost 80 per cent of its crude oil requirement).

The rupee has depreciated by about 13 per cent (or Rs 5.75) against the dollar between April 1, 2011 and March 30, 2012.

On Friday, the domestic currency closed at Rs 50.85 to the dollar.

BOP: Experiencing Stress

During Q3, India's balance of payments (the difference between the amount of exports and imports, including all financial exports and imports, by a country) was significantly stressed.

The Reserve Bank of India attributed the stress to widening trade deficit and capital inflows falling short of financing requirement, resulting in significant drawdown of foreign exchange reserves.

In the April-December 2011 period too current account deficit rose to 4 per cent of GDP (3.3 per cent in the April-December 2010 period) to $53.7 billion ($39.6 billion), RBI data on Balance of Payments showed.

The RBI said the rise in current account deficit in the first nine months of the current financial year reflects higher trade deficit on account of imports of petroleum, oil and lubricants, and gold and silver.

The Finance Minister, Mr Pranab Mukherjee, in his Budget speech had said that one of the primary drivers of current account deficit has been the growth of almost 50 per cent in imports of gold and other precious metals.

Dr Brinda Jagirdar, General Manager (Economic Research), State Bank of India, said: "Nothing much can be done to reverse the slowing exports as globally demand is falling. So, current account deficit can be tackled by making gold imports unattractive and by attracting foreign capital via external commercial borrowings and non-resident deposits."

Source: Business Line

Clarification on POT

Circular No.154/5/ 2012 – ST

FNo 334/1/2012- TRU

Government of India

Ministry of Finance

Department of Revenue

Central Board of Excise and Customs

Tax Research Unit

Room No 146, North Block, New Delhi

Dated: 28^th March 2012

To

Chief Commissioner of Customs and Central Excise (All)

Chief Commissioner of Central Excise & Service Tax (All)

Director General of Service Tax

Director General of Central Excise Intelligence

Director General of Audit

Commissioner of Customs and Central Excise (All)

Commissioner of Central Excise and Service Tax (All)

Commissioner of Service Tax (All)

Madam/Sir,

Subject: - Clarification on Point of Taxation Rules - regarding.

      

1.             Notification No.4/2012 - Service Tax dated the 17^th March 2012 has amended the Point of Taxation Rules 2011 w.e.f. 1^st April 2012, inter- alia, amending Rule 7 which applied to individuals or proprietary firms or partnership firms providing taxable services referred to in sub-clauses (g), (p), (q), (s), (t), (u), (za) and  (zzzzm) of clause (105) of section 65 of the Finance Act, 1994. Rule 7 determined the point of taxation in such cases as the date of receipt of payment. The provisions have been amended both in the Point of Taxation Rules 2011 and the Service Tax Rules 1994 such that from 1^st April 2012 the payment of tax shall be allowed to be deferred till the receipt of payment upto a value of Rs 50 lakhs of taxable services. The facility has been granted to all individuals and partnership firms, irrespective of the description of service, whose turnover of taxable services is fifty lakh rupees or less in the previous financial year.

2.            Representations have been received, in respect of the specified eight services, requesting clarification on determination of point of taxation in respect of invoices issued on or before 31^st March 2012 where the payment has not been received before 1^st April 2012.

3.            The issue has been examined. For invoices issued on or before 31^st March 2012, the point of taxation shall continue to be governed by the Rule 7 as it stands till the said date. Thus in respect of invoices issued on or before 31^st March 2012 the point of taxation shall be the date of payment.

4.            Trade Notice/Public Notice may be issued to the field formations accordingly.

5.            Please acknowledge the receipt of this circular. Hindi version to follow.

(Shobhit Jain)

OSD, TRU

Fax: 011-23092037

IT RETURN FORMS-2012-13

Income-tax (third amendment) Rules, 2012 - amendment in rule 12 and substitution of forms sahaj (itr-1), ITR-2, ITR-3, SUGAM (itr-4s), ITR-4 and itr-v

Notification No.14/2012 [F.No.142/31/2011-TPL]/S.O. 626(E), DATED 28-3-2012

In exercise of the powers conferred by section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-

1. (1) These rules may be called the Income-tax (3rd Amendment) Rules, 2012.

(2) They shall come into force on the 1st day of April, 2012.

2. In the Income-tax Rules, 1962,-

(A) in rule 12,-

(i)  in sub-rule (1),-

(a)  for the figures "2011", the figures "2012" shall be substituted;

(b)  after clause (a), the following proviso shall be inserted, namely:-

"Provided that the provisions of this clause shall not apply to a person being an individual, who is a resident and has

(i)  assets (including financial interest in any entity) located outside India; or

(ii)  signing authority in any account located outside India.";

 (c)  after clause (ca), the following proviso shall be inserted, namely:-

"Provided that the provisions of this clause shall not apply to a person being an individual or Hindu undivided family, who is a resident and has

 (i)  assets (including financial interest in any entity) located outside India; or

 (ii)  signing authority in any account located outside India."

(ii)  in sub-rule (3), in the proviso, clause (a) shall be renumbered clause (aaa) and before clause (a), as so renumbered the following clauses shall be inserted, namely:-

" (a)  an individual or a Hindu undivided family, if his or its total income, or the total income in respect of which he is or it is assessable under the Act during the previous year, exceeds ten lakh rupees, shall furnish the return for the assessment year 2012-13 and subsequent assessment years in the manner specified in clause (ii) or clause (iii);

(aa)  an individual or a Hindu undivided family, being a resident, having assets (including financial interest in any entity) located outside India or signing authority in any account located outside India and required to furnish the return in Form ITR-2 or ITR-3 or ITR-4, as the case may be, shall furnish the return for assessment year 2012-13 and subsequent assessment years in the manner specified in clause (ii) or clause (iii);"

(iii)  in sub-rule (5), for the figures "2010", the figures "2011" shall be substituted;

(B) in Appendix-II, for "Forms SAHAJ (ITR-1), ITR-2, ITR-3, SUGAM (ITR-4S), ITR-4 and ITR-V", the "Forms SAHAJ (ITR-1), ITR-2, ITR-3, SUGAM (ITR-4S), ITR-4 and ITR-V" shall be substituted.

Liberalization of ODI Norms

Liberalization of ODI Norms

The RBI vide A.P. (DIR Series) Circular No. 96 & 97 dated 28th March, 2012 has liberalized the provisions related to Overseas Direct Investment.The objective is to provide operational flexibility to Indian Corporate having investment abroad or Indian resident individuals to acquire securities aboard. ;

Key terms of circular are outlined below:

Liberalized provision relating to Corporate having investment abroad :

Creation of charge on immovable / movable property and other financial assets.

As measure of liberalization, now RBI can also consider proposals for creation of hypothecation/pledge /mortgage on movable and immovable properties and financial assets of Indian Party and group companies under approval route within the overall limit of 400% for financial commitment subject to the condition that the Indian party and their group companies are submitting the No Objection Certificate in this respect.

Reckoning bank guarantee issued on behalf of JV / WOS for computation of Financial Commitment

Bank guarantee issued by a resident bank on behalf of an overseas JV / WOS of the Indian party, which is backed by a counter guarantee / collateral by the Indian party, shall be considered for computation of the financial commitment of the Indian Party and reported accordingly which was not used to be reckoned as per the extant guidelines.

Issuance of personal guarantee by the direct / indirect individual promoters of the Indian Party

Indirect resident individuals promoters of the Indian Party can also issue personal guarantee provided they are governed by the same stipulations as in the case of personal guarantee by the direct promoters.

Financial Commitment without equity contribution to JV / WOS

As per the existing norms, only Indian party which has equity contribution in JV/WOS abroad can give loan or guarantee to or on behalf of the joint Venture/ wholly Owned Subsidiary abroad.

As per the amended norms Indian party without equity contribution in JV/WOS abroad can also give loan or guarantee to or on behalf of the joint Venture/ wholly Owned Subsidiary abroad under the approval route subject to the condition that: The laws of the host country permit incorporation of a company without equity participation by the Indian party.

This is done for relaxing the business requirements of Indian Party and Legal requirements of host country.

Submission of Annual Performance Report

Indian Party is required to submit the Annual Performance Report in form ODI Part III in respect to each Joint Venture or Wholly Owned Subsidiary outside India, set up or acquired by the Indian party, based on audited accounts of the JV/WOS abroad within 3 months of the closing of annual accounts of the JV / WOS.

Where the law of host country does not mandatorily require auditing the accounts of JV/ WOS, the Annual Performance Report may be submitted by the Indian Party based on unaudited annual accounts of JV/WOS provided:

Un-audited annual accounts of the JV / WOS has been adopted and ratified by the Board of the Indian party and

Statutory Auditors of the Indian party certifies that 'The un-audited annual accounts of the JV / WOS reflect the true and fair picture of the affairs of the JV / WOS.

Compulsorily Convertible Preference Shares (CCPS)

As per the extant guidelines only contribution to equity share capital of JV/WOS abroad is considered as ODI and not by contribution to the preference share capital. Now preference share (whether convertible or not) will be considered as capital contribution under ODI and not as loan as used to be considered earlier. This is in contrast to the RBI's stand on foreign direct investment in India where only mandatory convertible preference shares are considered as part of capital.

Liberalized provision relating to Indian Resident Individual acquiring Securities outside India:

Acquiring shares of a foreign company as qualification shares for appointment as Director.

As per the existing provisions, resident individual for being appointed as director in the company abroad can acquire qualification shares which shall not exceed 1% of the paid-up capital of the company.

As per the liberalized norms, the existing cap of one percent has been done away and qualification shares to the extent as required by laws of the country where the company is incorporated and at the same time it has been prescribed that remittance for acquiring such qualification shares shall be within the overall ceiling prescribed for the resident individuals under the Liberalized Remittance Scheme (LRS) in force at the time of acquisition.

Acquiring shares of a foreign company in lieu of professional services rendered or Director's remuneration

General permission has also been granted to Resident Individual to acquire foreign securities of company incorporated outside India in consideration for professional services rendered to the foreign entity or in lieu of Director's Remuneration; earlier to the notification RBI approval was required for the same.

The limit for acquiring such shares shall be within the overall ceiling prescribed for the resident individuals under the Liberalized Remittance Scheme (LRS) in force at the time of acquisition.

Acquiring shares under ESOP Scheme

General permission has also been granted to Resident Employee or Directors to acquire foreign securities of company incorporated outside India pursuant to ESOP Scheme irrespective of the percentage of the direct or indirect equity stake in the Indian company subject to the following:

i. The shares under the ESOP Scheme are offered by the issuing company globally on a uniform basis, and

ii. An Annual Return is submitted by the Indian company to the Reserve Bank through the AD Category - I bank giving details of remittances / beneficiaries, etc.

Revised fees of Bank Audit 2011-2012 & increase in time line to complete the audit to 21 April at branch level

Revised fees of Bank Audit 2011-2012 & increase in time line to complete the audit to 21 April at branch level




Category of bank branch Rates of audit fees Revised Rates of audit 
(on the basis of quantum of advances) (Rs.) New Fees

Upto Rs.75 lakh 12,500/- 15,625

Above Rs.75 lakh and upto Rs.150 lakh 15,000/- 18,750

Above Rs.150 lakh and upto Rs.300 lakh 22,500/- 28,125

Above Rs.3 crore and upto Rs.5 crore 30,000/- 37,500

Above Rs.5 crore and upto Rs.10 crore 35,000/- 43,750

Above Rs.10 crore and upto Rs.20 crore 50,000/- 62,500

Above Rs.20 crore and upto Rs.30 crore 69,000/- 86,250

Above Rs.30 crore and upto Rs.50 crore 1,05,000/- 131,250

Above Rs.50 crore and upto Rs.75 crore 1,20,000/- 150,000

Above Rs.75 crore and upto Rs.125 cror 1,59,000/-198,750

Above Rs.125 crore and upto Rs.175 crore1,99,000/-248,750

Above Rs.175 crore and upto Rs.300 crore2,50,000/- 312,500

Above Rs.300 crore and upto Rs.500 crore2,82,000/- 352,500

Above Rs.500 crore 3,13,000 391,250

CBDT sets up panel for tax anti-avoidance

CBDT sets up panel for tax anti-avoidance

The Central Board of Direct Taxes (CBDT), Indias apex body for administration of taxes, has formed a six-member committee to draft guidelines for enforcing the general anti-avoidance rules (GAAR) introduced in the Union budget to crack down on tax cheats.

The panel, headed by CBDT chairman Laxman Das, is expected to submit the draft norms to the finance ministry within two months. The proposed guidelines will be put up for public feedback before they are finalized by the committee, which held a meeting early this week in New Delhi.

GAAR will help the tax authority deal with commercial transactions that are structured essentially to circumvent tax laws and avoid paying taxes. If the revenue authority concludes that a transaction by any entity is aimed primarily at avoiding taxes, it will be able to deny tax benefits claimed by the entity.
The key challenge for the committee is to formulate the rules to determine whether the arrangement lacks commercial purpose or was made to obtain a tax benefit, said a revenue officer familiar with the development.

The new rules follow the Supreme Court ruling in January that the Vodafone Group Plcs $11.08 billion (around Rs. 56,400 crore today) transaction with Hutchison Whampoa Ltd that gained it entry into the Indian telecom market was outside the purview of the Indian tax law. The transaction was between Vodafones Netherlands subsidiary and Hutchisons Cayman Islands subsidiary.

In his ruling, Chief Justice S.H. Kapadia said: It is for the government of the day to have them (clear tax laws) incorporated in the treaties and laws so as to avoid conflicting views. Investors should know where they stand. It also helps the tax administration in enforcing the provisions of the taxing laws.

CBEC on Service Tax on Tyre Retreading

Service Tax on Tyre Retreading – Board Clarification

In a letter to the Chairman, CBEC, the AP Tyre Retreaders Association, requested the Department not to charge Service Tax on retreading of tyres under 'Management Maintenance & Repair Service', on the ground that 'retreading of tyre' is specifically figuring in Central Excise Tariff under TI 4012 and therefore, they are excisable goods. Hence, Service Tax cannot be imposed, as Excise Duty is payable.

Board has examined the issue and observes,

"The matter has been examined. For the purpose of levy of Central Excise, Section 3 of the Central Excise Act 1994, being the charging Section provides that a duty of excise shall be levied on all Excisable Goods, which are produced or manufactured in India at the rates set forth in the first schedule of the Central Excise Tariff Act. Further, 'Excisable Goods' have been defined under Section 2(d) of the Central Excise Act (CEA) as the goods specified in the first and second schedule of the CETA as being subject to a duty of excise and include salt.

Thus, it is apparent that if any goods are barely mentioned in the Central Excise Tariff Act, then, though they would qualify as 'excisable goods', however, for the Central Excise Duty to come into operation, as per Section 3 of the CEA, the additional requirement of these goods to have been produced or manufactured in India would also have to be satisfied".

Board also referred to the Supreme Court judgement in the case of Ahmedabad Electricity Co. Ltd - 2003-TIOL-17-SC-CX, in which the Supreme Court observed,

"... Therefore, simply because goods find a mention in one of the entries of the First Schedule does not mean that they have become liable for payment of excise duty. Goods have to satisfy the test of being produced or manufactured in India. It is settled law that excise duty is a duty levied on manufacture of goods. Unless goods are manufactured in India, they cannot be subjected to payment of excise duty. There is no merit in the argument that simply because a particular item is mentioned in the First Schedule, it becomes eligible to excise duty."

So, the Board concludes and tells the Association, "retreading of tyres is covered under the ambit of the service 'Management Maintenance & Repair Service' and is liable to payment of service tax. You are accordingly requested to advise the Members of your Association to pay Service Tax"

CBEC F.No. 137/125/2011-Service Tax, Dated: February 27, 2012

Finance bill, 2012 & Judicial Decisions

Finance bill, 2012 & Judicial Decisions

A Reckoner of Judicial decisions proposed to be overcome/incorporated in the Act-

SOURCE: TAXMANN

--

[2012] 19 taxmann.com 251 (Article)

Finance bill, 2012 & Judicial Decisions

A Reckoner of Judicial decisions proposed to be overcome/incorporated in the Act

The Finance Bill,2011 contains a large number of proposed amendments which are based on judicial decisions. Some of these proposed amendments are for overcoming judicial decisions unfavourable to the Revenue. Some of the proposed amendments are meant to resolve controversy due to conflicting rulings. Some proposed amendments are for incorporating in the statute principles set out in judicial decisions. These are all discussed below :

Sr. No.	Subject-matter	Court Rulings	Proposed Amendments to overcome/ incorporate Court rulings or to resolve conflicting judicial opinion
(1)	(2)	(3)	(4)
1	Definition of capital asset in section 2(14)	Applying the test of enforceability, influence/ persuasion of parent company over its subsidiary cannot be construed as a right in the legal sense since capital asset covers 'property' of any description and a right has to be legally enforceable to be 'property' and 'capital asset'- Vodafone International Holdings B.V. v Union of India [2012] 17 taxmann.com 202/204 Taxman 408 (SC)	Explanation is proposed to be inserted below section 2(14)(definition of 'capital asset') with retrospective  effect from the 1-4-1962 which clarifies that "property" includes and shall be deemed to have always included any rights in or in relation to an Indian company, including rights of management or control or any other rights whatsoever
2	Definition of transfer in section 2(47)	On transfer of shares of a foreign company to a non-resident offshore, there is no transfer of shares of the Indian Company, though held by the foreign company, in such a case it cannot be contended that the transfer of shares of the foreign holding company, results in an extinguishment of the foreign company control of the Indian company and it also does not constitute an extinguishment and transfer of an asset situate in India. Transfer of the foreign holding company's share offshore, cannot result in an extinguishment of the holding company right of control of the Indian company nor can it be stated that the same constitutes extinguishment and transfer of an asset/ management and control of property situated in India- Vodafone International Holdings B.V. (supra)	Further, Explanation below section 2(47) (definition of "transfer") proposed to be renumbered as Explanation 1 and new Explanation 2 proposed to be inserted with retrospective effect from the 1-4-1962 to clarify that ""transfer" includes and shall be deemed to have always included disposing of or parting with an asset or any interest therein, or creating any interest in any asset in any manner whatsoever, directly or indirectly, absolutely or conditionally, voluntarily or involuntarily, by way of an agreement (whether entered into in India or outside India) or otherwise, notwithstanding that such transfer of rights has been characterised as being effected or dependent upon or flowing from the transfer of a share or shares of a company registered or incorporated outside India"
3	Section 9(1)(i)-Income deemed to accrue or arise in India from transfer of capital asset situated in India	The legislature has not used the words "indirect transfer" in section 9(1)(i). If indirect transfer of a capital asset is read into section 9(1)(i) then the words capital asset situated in India would be rendered nugatory. Similarly, the words underlying asset do not find place in section 9(1)(i). Thus, the words directly or indirectly in Section 9(1)(i) go with the income and not with the transfer of a capital asset (property). The Direct Tax Code (DTC) Bill, 2010 proposes to tax income from transfer of shares of a foreign company by a non-resident, where the fair market value of the assets in India, owned directly or indirectly, by the company, represents at least 50% of the fair market value of all assets owned by the company. This proposal indicates in a way that indirect transfers are not covered by the existing section 9(1)(i) of the Act. [Per CJI S.H. Kapadia]. On a comparison of Section 64 and Section 9(1)(i) what is discernible is that the Legislature has not chosen to extend Section 9(1)(i) to "indirect transfers". - Vodafone International Holdings B.V. (supra)	New Explanation 4 seeks to clarify that the expression "through" shall mean and include and shall be deemed to have always meant and included "by means of", "in consequence of" or "by reason of". New Explanation 5 proposed to be inserted below section 9(1)(i) w.r.e.f.1-4-1962 to provide that capital asset situated in India will also cover Share or interest in a foreign company/entity(company or entity registered or incorporated outside India if such share/interest derives, directly or indirectly, its value substantially from the assets located in India. Therefore, transfer of such share/interest will attract capital gains even if effected outside India
4	-------	In W.T. Ramsay Ltd. v. IRC [1981] 1 All E.R. 865 the "look at" test was enunciated.. According to that test, the task of the Revenue is to ascertain the legal nature of the transaction and, while doing so, it has to look at the entire transaction holistically and not to adopt a dissecting approach.. The Revenue cannot start with the question as to whether the impugned transaction is a tax Deferment/saving device but that it should apply the "look at" test to ascertain its true legal nature [See Craven v. White [1988] 3 All ER 495 which further observed that genuine strategic tax planning has not been abandoned by any decision of the English Courts till date]. Applying the above tests, we are of the view that every strategic foreign direct investment coming to India, as an investment destination, should be seen in a holistic manner. While doing so, the Revenue/Courts should keep in mind the following factors: (i) the concept of participation in investment, (ii) the duration of time during which the Holding Structure exists; (iii) the period of business operations in India; (iv) the generation of taxable revenues in India; (v) the timing of the exit; (vi) the continuity of business on such exit. - Vodafone International Holdings B.V. (supra)	General Anti-Avoidance Rule [Provisions in New Chapter X-A (sections 95 to 102)] Consequences of treating an arrangement as an impermissible tax avoidance arrangement: • Treating the place of residence of any party to the arrangement or the situs of an asset or of a transaction, at a place other than the place of residence, location of the asset or location of the transaction as provided under the arrangement. • Considering or looking through any arrangement by disregarding any corporate structure. Factors not to be taken into account while determining whether an agreement lacks commercial substance: •   The period or time for which the arrangement (including operations therein) exists; •   The fact of payment of taxes, directly or indirectly, under the arrangement •   The fact that an exit route (including transfer of any activity or business or operations) is provided by the arrangement.
5	Section 195(1) - Withholding Tax	Section 195 would apply only if payments made from a resident to another non-resident and not between two non-residents situated outside India- Vodafone International Holdings B.V. (supra)	Section 195 proposed to be amended w.r.e.f. 1-4-1962 to provide that Obligation to deduct tax u/s 195(1) applicable to all persons, whether resident or non-resident, whether or not the non-resident has a residence, place of business or business connection in India; or any other presence in any manner whatsoever
6	Section 9(1)(vi)-Definition of "royalty"-	Whether consideration for use of computer software is royalty or not-Section 9(1)(vi) provides that any income payable by way of royalty in respect of any right, property or information is deemed to be accruing or arising in India. The term "royalty" has been defined in Explanation 2 which means consideration received or receivable for transfer of all or any right in respect of certain rights, property or information. In DIT v. Ericsson AB[2011]16 taxmann.com 371/[2012] 204 Taxman 192 (Delhi), it was held that supply of software which was an inseparable part of GSM system and incapable of independent use is not taxable as royalty. In order to constitute 'royalty' as defined in Explanation 2 to section 9(1)(vi), what is contemplated is a payment that is dependent upon user of copyright and not a lump sum payment made for acquisition of a copyrighted article. Contrary view was given by Karnataka High Court in CIT v Samsung Electronics Co. Ltd. [2011] 16 taxmann.com 141/203 Taxman 477	Proposed Amendments to resolve controversy consideration for use of computer software is royalty or not -Explanation to section 9(1)(vi) amended with retrospective effect from 1-6-1976 to provide that consideration for use or right to use of computer software is royalty by clarifying that transfer of all or any rights in respect of any right, property or information as mentioned in Explanation 2, includes and has always included transfer of all or any right for use or right to use a computer software (including granting of a licence) irrespective of the medium through which such right is transferred. Thus, this amendment seeks to resolve controversy regarding whether consideration for use of computer software is royalty or not which has arisen due to contrary decisions of Delhi High Court and Karnataka High Court.
		Whether satellite payments are royalty or not-An issue arises whether the right, property or information has to be used directly by the payer or is to be located in India or control or possession of it has to be with the payer. Also whether satellite payments are royalty or not was an issue. •  Income received by foreign satellite companies not taxable in India since customers merely given access to broadband available in transponder and Control and constructive possession of transponders could not be handed over by satellite operator to its customers- Asia Satellite Telecommunications Co. Ltd. v. DIT [2011] 197 Taxman 263/9 taxmann.com 168 (Delhi) •  Payments for lease of transponder capacity is not royalty nor fees for technical services –ISRO Satellite Centre, In re [2008] 175 Taxman 97 (AAR - New Delhi) •  Payments made to service providers for use of bandwidth provided for downlinking signals in the US not taxable in India as 'royalty' or 'fees for technical services: –Infosys Technologies Ltd v Dy.CIT [2011] 45 SOT 157/10 taxmann.com 1 (Bang.)	Explanation to section 9(1)(vi) proposed to be amended with effect from 1-6-1976 to provide that •  Royalty u/s 9(1)(vi) includes consideration in respect of any right, property or information, whether or not its possession or control is with the taxpayer, it is used directly by the taxpayer, or its location is in India •  royalty includes and has always included consideration in respect of any right, property or information, whether or not (a) the possession or control of such right, property or information is with the payer; (b) such right, property or information is used directly by the payer; (c) the location of such right, property or information is in India. •  the term "process" includes and shall be deemed to have always included transmission by satellite (including uplinking, amplification, conversion for downlinking of any signal), cable, optic fibre or by any other similar technology, whether or not such process is secret
7,	New proposed section 50D - Capital gains	Capital gains are calculated on transfer of a capital asset, as sale consideration minus cost of acquisition. In some recent rulings, it has been held that where the consideration in respect of transfer of an asset is not determinable or ascertainable, then, as the machinery provision fails, the gains arising from the transfer of such assets is not taxable and also that fair market value cannot be taken as deemed full value of consideration unless there is a specific provision in this respect. This particularly happens when shares in Indian companies are transferred 'without consideration' by companies as part of restructuring exercise. [See Dana Corporation, In Re [2010]186 Taxman 187(AAR-New Delhi), Goodyear Tire & Rubber Co., In Re [2011] 199 Taxman 121/11 taxmann.com 43 (AAR - New Delhi), Amiantit International Holding Ltd., In re [2010]189 Taxman 149(AAR - New Delhi)] Obviously, these transfers are not "gifts" but consideration for them is general improvement in business/synergies etc which is not "ascertainable" or "quantifiable" In Amiantit International Holding Ltd., In re (supra), the AAR observed "As stated in the Law and Practice of Income-tax (by Kanga, Palkhivala and Vyas) income, profits and gains maybe realized in the form of money's worth as well as money, in kind as well as in cash. Even then, the alleged consideration for which the shares are to be transferred should be capable of being evaluated on commercial and accounting principles. The possibility of applicant-transferor improving its overall business by virtue of re-organization and the mere possibility or chance of the applicant making better returns in the near or distant future as a consequence of reorganization can hardly be regarded as a consideration accruing or arising to the transferor when he has no right to receive a definite or an ascertainable amount or benefit from the transferee. A capital gain cannot arise on the basis of uncertain and indefinite future contingencies or hypothetical and imaginary estimations. There is really no effective answer from the Revenue's side to the question as to what is the valuable consideration that has accrued or arisen to the transferor and how it can be converted into money's worth for the purpose of computing the alleged capital gain. The only endeavour of revenue's counsel was to take a plea that the "benefits and advantages" mentioned by the applicant in para H of page 7 of the application represent the valuable consideration for transfer. ……. Thus, the full value of consideration for the transfer of shares is sought to be deduced from the overall objectives of reorganization and the resultant changes in investment. It is not explained how they can be evaluated in terms of money…"	In order to overcome the judicial decisions, new section 50D is proposed to be inserted with effect from A.Y.2013-14 to provide that fair market value of asset shall be deemed to be the full value of consideration if actual consideration is not attributable or determinable. This proposed amendment takes a cue from the following observations of ITAT in Dy. CIT v. Summit Securities Ltd [2012] 19 taxmann.com 102 (Mum.)(SB) "…….......the full value of consideration for the purposes of section 48 has to be considered as only the amount actually received or accruing as a result of the transfer of capital asset except where it has been substituted with fair market value or by any other mode. It is only in such specific cases that the actual amount received or accruing shall be replaced with the fair market value or such other mode as specified. In the absence of any specific provision, the general meaning of the amount actually received or accruing is to be considered as the full value of consideration received or accruing as a result of transfer of capital asset. …….."
8.	Section 40A(2)-Disallowance of domestic related party transactions	Section 40A of the Act empowers the Assessing Officer to disallow unreasonable expenditure incurred between related parties. Further, under Chapter VI-A and section 10AA, the Assessing Officer is empowered to recompute the income (based on fair market value) of the undertaking to which profit linked deduction is provided if there are transactions with the related parties or other undertakings of the same entity. However, no specific method to determine reasonableness of expenditure or fair market value to recompute the income in such related transactions is provided under these sections.	The Supreme Court in the case of CIT v. Glaxo SmithKline Asia (P.) Ltd. [2010] 195 Taxman 35 in its order has, after examining the complications which arise in cases where fair market value is to be assigned to transactions between domestic related parties, suggested that Ministry of Finance should consider appropriate provisions in law to make transfer pricing regulations applicable to such related party domestic transactions. Taking a cue from the above decision,, the transfer pricing regulations are proposed to be extended to the transactions entered into by domestic related parties or by an undertaking with other undertakings of the same entity for the purposes of section 40A, Chapter VI-A and section 10AA. The concerns of administrative and compliance burden are addressed by restricting its applicability to the transactions, which exceed a monetary threshold of Rs. 5 crores in aggregate during the year. In view of the circumstances which were present in the case before the Supreme Court, there is a need to expand the definition of related parties for purpose of section 40A to cover cases of companies which have the same parent company. It is, therefore, proposed to amend the Act to provide applicability of transfer pricing regulations (including procedural and penalty provisions) to transactions between related resident parties for the purposes of computation of income, disallowance of expenses etc. as required under provisions of sections 40A, 80-IA, 10AA, 80A, sections where reference is made to section 80-IA, or to transactions as may be prescribed by the Board, if aggregate amount of all such domestic transactions exceeds Rupees 5 crore in a year. It is further proposed to amend the meaning of related persons as provided in section 40A to include companies having the same holding company. This amendment will take effect from 1st April, 2013 and will, accordingly, apply w.e.f. Assessment Year 2013-14 [Clauses 12, 23, 29, 33, 35, 37, 38, 92, 94, 97]
9.	Section 56(2)(vii) - Gifts	Under the existing provisions of clause (vii) of sub-section (2) of section 56 any sum or property received by an individual or HUF for inadequate consideration or without consideration is deemed as income and is taxed under the head "Income from other sources". However, in the case of an individual, receipts from relatives are excluded from the purview of this section and are therefore treated as not taxable. The definition of relative as given in this sub-clause is only in relation to an individual and not in relation to a HUF. Therefore, gifts received by HUF from its members are not exempt from donee-based taxation in the hands of HUF. in Vineetkumar Raghavjibhai Bhalodia v. ITO [2011] 11 taxmann.com 384/46 SOT 197 (Rajkot) wherein ITAT held that in the context of section 56(2)(vi) that an HUF is nothing but 'a group of relatives'. So if an individual receives gifts whether from an individual relative or a group of relatives, he should be exempt from taxation. The ITAT observed "…..Actually a 'Hindu Undivided Family" constitutes all persons lineally descended from a common ancestor and includes their mothers, wives or widows and unmarried daughters. All these persons fall in the definition of "relative" as provided in Explanation to clause ( vi) of section   56(2) of the Act. The observation of the CIT(A) that HUF is as good as 'a body of individuals' and cannot be termed as "relative" is not acceptable. Rather, an HUF is 'a group of relatives'..… It is not expressly defined in the Explanation that the word "relative" represents a single person. And it is not always necessary that singular remains singular. Sometimes a singular can mean more than one, as in the case before us……. The word "Hindu Undivided Family", though sounds singular unit in its form and assessed as such for income-tax purposes, finally at the end a "Hindu Undivided Family" is made up of "a group of relatives". Thus, in our opinion, a singular word/words could be read as plural also, according to the circumstance/ situation. ……."	It is proposed to amend the provisions of section 56 so as to provide that any sum or property received without consideration or inadequate consideration by an HUF from its members would also be excluded from taxation. For this purpose, clause (e) of the Explanation below section 56(2)(vii) is proposed to be substituted to provide that in case of HUF, relative means members of the HUF. This amendment will take effect retrospectively from the 1st day of October, 2009 The proposed amendment as above is inspired by the decision of ITAT in Vineetkumar Raghavjibhai Bhalodia (supra)
10.	Section 68-Cash credits	Section 68 of the Act provides that if any sum is found credited in the books of an assessee and such assessee either (i) does not offer any explanation about nature and source of money; or (ii) the explanation offered by the assessee is found to be not satisfactory by the Assessing Officer, then, such amount can be taxed as income of the assessee. The onus of satisfactorily explaining such credits remains on the person in whose books such sum is credited. If such person fails to offer an explanation or the explanation is not found to be satisfactory then the sum is added to the total income of the person. Certain judicial pronouncements have created doubts about the onus of proof and the requirements of this section, particularly, in cases where the sum which is credited as share capital, share premium etc which are sought to be overcome by proposed amendment to section 68 as under: • The onus cast upon the assessee company was discharged upon disclosure of the names and particulars of the alleged bogus shareholders. It was for the Department to conduct its own enquiry thereafter and additions if any may be made in the hands of the shareholders –Lovely Exports(P.) Ltd. [Application No. 11993 of 2007, dated 11-1-2008] • Even if subscribers to the capital are not genuine, the amount received by the company as share capital could not be assessed in the hands of the company itself. Such amounts should be considered for assessment in the hands of persons who are alleged to have really advanced the money. –Stellar Investment Ltd [2001] 115 Taxman 99 (SC) • Delhi HC held that the amount of share application money received by a Company from alleged bogus shareholders could not be regarded as undisclosed income u/s 68 when the assessee furnished details regarding shareholders. If the names of the alleged bogus shareholders are given to the AO, then the Department is free to proceed to reopen their individual assessments in accordance with law. The Supreme Court upheld this view. –CIT v Divine Leasing & Finance Ltd [2007] 158 Taxman 440(SC) • "It would be asking for a moon if such companies are asked to find out from each and every share applicant/subscribers to first satisfy the assessee companies about the source of their funds before investing." –CIT v Kamdhenu Steel & Alloys Ltd. [2012] 19 taxmann.com 26 (Delhi) • Where assessee had duly discharged its onus by furnishing names, age, address, date of filing application of share, number of shares of each subscriber, the AO was not justified in making addition u/s 68. – CIT v SIT Extrusion (P.) Ltd. [2011] 333 ITR 269 (MP) • It was not for the assessee to place material before the Assessing Officer about creditworthiness of the shareholders. Once the company had given the addresses of the shareholders and their identity was not in dispute, it was for the Assessing Officer to make further inquiry with the investors about their capacity to invest the amount in shares. CIT v Arunananda Textiles(P.)Ltd [2011] 203 Taxman 32 (Kar.) (Mag.)/15 taxmann.com 226 (Kar.) • Once the assessee proves the identity of creditors/share applicants, by either furnishing their PAN numbers or income-tax assessment numbers, and shows genuineness of transaction by showing money in his books either by account payee cheque or by draft or by any other mode, onus of proof would shift to revenue.- CIT v. Dwarkadhish Investment (P.) Ltd. [2010] 330 ITR 298/194 Taxman 43 (Delhi) Once documents like PAN Card, bank account details or details from the bankers were given by the assessee, onus shifts upon the Assessing Officer and it is on him to reach the shareholders. The Assessing Officer could not burden the assessee merely on the ground that summons issued to the investors were returned back with the endorsement not traceable – Creative World Telefilms Ltd. (supra)	It is, therefore, proposed to amend section 68 of the Act to provide that the nature and source of any sum credited, as share capital, share premium etc., in the books of a closely held company shall be treated as explained only if the source of funds is also explained by the assessee company in the hands of the resident shareholder. However, even in the case of closely held companies, it is proposed that this additional onus of satisfactorily explaining the source in the hands of the shareholder, would not apply if the shareholder is a well regulated entity, i.e. a Venture Capital Fund, Venture Capital Company registered with the Securities Exchange Board of India (SEBI).   The above proposed amendment while seeking to overcome judicial precedents in Col (3) takes into account judicial pronouncements such as CIT v. Value Capital Services (P.) Ltd. [2008] 307 ITR 334 (Delhi) and CIT v. Oasis Hospitalities (P.) Ltd. [2011] 333 ITR 119/198 Taxman 247/9 taxmann.com 179 (Delhi) and Creative World Telefilms Ltd. [2011] 203 Taxman 36 (Bom.) (Mag.)/15 taxmann.com 183 (Bom.) which while recognizing that the pernicious practice of conversion of unaccounted money through masquerade of investment in the share capital of a company needs to be prevented, have advised a balance to be maintained regarding onus of proof to be placed on the company. The Courts have drawn a distinction and emphasized that in case of private placement of shares the legal regime should be different from that which is followed in case of a company seeking share capital from the public at large. In the case of closely held companies, investments are made by known persons. Therefore, a higher onus is required to be placed on such companies besides the general onus to establish identity and creditworthiness of creditor and genuineness of transaction. This additional onus, needs to be placed on such companies to also prove the source of money in the hands of such shareholder or persons making payment towards issue of shares before such sum is accepted as genuine credit. If the company fails to discharge the additional onus, the sum shall be treated as income of the company and added to its income." Bombay HC recently in Major Metals Ltd noted that "Significantly, the judgment of the Delhi High Court makes a distinction between a case where shares are allotted in the course of a large scale subscription to the shares of a public company on the one hand and a case of private placement on the other." Relying on subsequent rulings in Value Capital Services (P.) Ltd. (supra) and Oasis Hospitality (P.) Ltd. (supra) and Creative World Telefilms Ltd. (supra), HC held that "However, the initial burden on the assessee would be some-what heavy in case the assessee is a private limited company where the shareholders are closely related because in such a case the assessee cannot feign ignorance about the status of the parties". Thus, the proposed amendment incorporates the law laid down in above cases.
11.	Section 115JB-MAT	Judicial decisions which exempt non-Schedule VI companies (insurance, banking or electricity company) from MAT-Proviso to section 211(2) of the Companies Act,1956 permits certain companies, e.g. insurance, banking or electricity company to prepare their profit and loss account in accordance with the provisions specified in their regulatory Acts. Also, Courts and ITAT have held in a catena of decisions that since profit and loss account for MAT purposes is required by section 115JB(2) to be prepared as per Schedule VI, banks, electricity companies etc. which are exempt from Schedule VI are not liable to MAT as under: •    In Krung Thai Bank PCL v. Jt. DIT(International Taxation) [2011] 16 taxmann.com 239/[2012] 49 SOT 70 (Mum.)(URO), the Tribunal held that the provisions of section 115JB can only come into play when the assessee is required to prepare its profit and loss account in accordance with the provisions of Parts II and III of Schedule VI to the Companies Act. The starting point of computation of MAT under section 115JB is the result shown by such a profit and loss account. In the case of banking companies, however, the provisions of Schedule VI are not applicable in view of exemption set out under proviso to section 211(2) of the Companies Act. The final accounts of the banking companies are required to be prepared in accordance with the provisions of the Banking Regulation Act. The provisions of section 115JB cannot thus be applied to the case of a banking company. •    In Kerala State Electricity Board v. Dy. CIT [2011] 196 Taxman 1/[2010] 8 taxmann.com 118, the Kerala High Court held that section 115JB stipulates that the accounting policies, accounting standards, etc., shall be uniform, both for the purpose of income-tax as well as for the information statutorily required to be placed before the annual general meeting conducted, in accordance with section 210 of the Companies Act, 1956. However, the assessee though was by definition a company under the Income-tax Act and deemed to be a company for the purpose of the Income-tax Act, by virtue of the declaration under section 80 of the Electricity Supply Act, it was not a company for the purpose of the Companies Act. Therefore, it was not obliged either to convene an annual general meeting or place its profit and loss account in such general meeting. As a matter of fact, a general meeting contemplated under section 166 of the Companies Act, 1956 was not possible in the case of the assessee, as there were no shareholders for the assessee-board. On the other hand, under section 69 of the Electricity Supply Act, the assessee was obliged to keep proper accounts, including the profit and loss account, and to prepare an annual statement of accounts, balance sheet, etc., in such form as had been prescribed by the Central Government and notified in the Official Gazette. Thus, it could be seen that coming to the maintenance of the accounts, the assessee, though was deemed to be a 'company' - both by virtue of operation of section 80 of the Electricity Supply Act for the purpose of Income-tax Act and by virtue of the definition of the expression 'company' under the Income-tax Act, yet it was required to keep and maintain its accounts in a manner specified by the Central Government, but not in the manner specified in the Companies Act. Therefore, MAT would not apply to electricity companies. In Union Bank of India v. Asstt. CIT [2011] 16 taxmann.com 304/[2012] 49 SOT 32 (Mum.), the ITAT upheld the contention of the assessee-bank that it was not a company under Companies Act but is only deemed to be a company as per the provisions of section 11 of the Banking Companies (Acquisition and Transfer of Undertaking) Act, 1970. Therefore as held by the Jurisdictional ITAT in the case of Maharashtra State Electricity Board v. Jt. CIT [2002] 82 ITD 422 (Mum.) the provisions of section 115JB cannot be made applicable to it.	Proposed amendments to section 115JB to overcome judicial decisions which exempt non-Schedule VI companies (insurance, banking or electricity company) from MAT- The Finance Bill, 2012 proposes to substitute section 115JB(2) with effect from A.Y.2013-14 to provide that companies which are not required under the proviso to section 211(2) of the Companies Act to prepare their profit and loss account in accordance with the Schedule VI of the Companies Act, 1956, profit and loss account prepared in accordance with the provisions of their regulatory Acts shall be taken as a basis for computing the book profit under section 115JB.
12.	Explanation 1 to section 115JB(2)-Book Profit definition	Judicial decision on revaluation reserve balance pertaining to revalued asset disposed off- The above amendment has been made to overcome the decision in ITO v. Galaxy Saws (P.) Ltd. [2011] 13 taxmann.com 179/132 ITD 236 (Mum.) wherein it was held that no addition could be made to the net profit on account of revaluation reserve directly taken to the balance sheet while computing the book profit. In that case, the assessee, company had sold its premises for Rs. 96 lakhs. Book value of property was Rs. 3,29,143 and, therefore, there was a gain of Rs. 92,72,858. Assessee got property revalued and as per report of registered valuer, value of property was Rs. 97.44 lakhs. Gain in book value of property was taken by assessee to balance sheet as revaluation reserve. However, loss arising on sale, i.e., Rs. 1.44 lakhs (Rs. 97.44 lakhs minus Rs. 96 lakhs) was debited by assessee to profit and loss account. Assessing Officer rejected computation of book profit made by assessee based on revalued cost and added gain of Rs. 92.70 lakhs computed on basis of book value of asset originally shown. The ITAT held that since revaluation reserve had been directly taken to balance sheet and not debited to profit and loss account, it could not be added under clause (b) of Explanation 1 to section 115JB(2). The provisions of Explanation 1 to section 115JB(2) that amount carried to any reserve by whatever name called has to be added to the net profit if the amount had been debited to the profit and loss account. In this case the revaluation reserve had been directly taken to the balance sheet and not debited to the profit and loss account and, therefore, the amount could not be added under clause (b) of Explanation 1 to section 115JB(2).	Explanation 1 to section 115JB has been amended with effect from A.Y.2013-14 to substitute the words ""if any amount referred to in clauses (a) to (i) is debited to the profit and loss account, and as reduced by,—"with the words ""(j) the amount standing in revaluation reserve relating to revalued asset on the retirement or disposal of such asset, if any amount referred to in clauses (a) to (i) is debited to the profit and loss account or if any amount referred to in clause (j) is not credited to the profit and loss account, and as reduced by,—". The above proposed amendment intends to overcome the judicial decision in Col(3). Further, Since (AS)10 permits companies to transfer "revaluation reserve relating to revalued asset on the retirement or disposal of such asset", to general reserve, companies follow this treatment. The Explanatory Memorandum to the Finance Bill, 2012 explains that as a result of this treatment permitted by (AS)10 "the gains attributable to revaluation of the asset is not subject to MAT liability. It is, therefore, proposed to amend section 115JB to provide that the book profit for the purpose of section 115JB shall be increased by the amount standing in the revaluation reserve relating to the revalued asset which has been retired or disposed, if the same is not credited to the profit and loss account."
13.	Section 234D- Application to AO to determine appropriate proportion of sum chargeable even when payment not chargeable under the Act	In GE India Technology Cen. (P.) Ltd. v CIT [2010] 193 Taxman 234 (SC), it was held that the application of section 195(2) pre-supposes that the person responsible for making the payment to the non-resident is in no doubt that tax is payable in respect of some part of the amount to be remitted to a non-resident but is not sure as to what should be the portion so taxable or is not sure as to the amount of tax to be deducted. In such a situation, he is required to make an application to the ITO(TDS) for determining the amount	The Supreme Court ruling in Col. (3) sought to be overcome by amending section 195 to provide that class of persons or cases (to be notified by CBDT) responsible for making payment to a non-resident, whether or not such payment is chargeable under the Act, shall make an application to the AO to determine the appropriate proportion of sum chargeable.
14.	Section 209-Computation of Advance Tax	In Dy.CIT v. Pride Foramer SAS [2008] 24 SOT 59 (Delhi), it was held by ITAT that tax deductible at source has to be excluded while computing the advance tax liability as provided in section 209(1)(d), even if the tax had not actually been deducted. If entire income of assessee is income on which tax deductible at source, no advance tax could be payable by assessee and, therefore, no interest under section 234B could be charged -	To overcome the ITAT ruling in Col (3), section 209 is proposed to be amended w.r.e.f.1-4-2012 to provide that that where a person has received any income without deduction or collection of tax, he shall be liable to pay advance tax in respect of such income. The rationale is to make an assessee liable for payment of advance tax in respect of income which has been received or paid without deduction or collection of tax.
15.	Section 234D-Interest on excess refund	In ITO v. Ekta Promoters (P) Ltd. [2008] 113 ITD 719 (Delhi) (SB) a Special Bench of Delhi ITAT held that the provision for levy of interest on excess refund u/s 234D was prospective and applicable from AY 2004-05 since the provisions of section 234D were substantive and hence could not be held as retrospective in nature, unless specifically provided in the statute	To overcome the ITAT ruling in Col.(3), section 234D is proposed to be amended to provide that the provisions of section 234D would be applicable to any proceeding, which is completed on or after 1st June, 2003, irrespective of the assessment year to which it pertains. Section 234D provides for levy of interest on excess refund granted to the assessee.

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