1. 123 TAXMAN (ST.) 31

PAYMENT OF INCOME TO RAMKRISHAN MATH and RAMMKRISHNA MISSION WITHOUT DEDUCTION OF TAX AS REQUIRED UNDER SECTION 193, 194A AND 194K OF INCOME TAX ACT.

CBDT circular No. 3 dated 28/6/2002 states that in case of Ramkrishna math and Ramkrishna Mission whose income is exempt under section 10(23C)(iv) of Income Tax Act, the income being interest in securities of Central & State Government, Interest other than interest on securities and income of mutual fund specified under section 10(23D) or UTI may be paid without deduction of Income Tax at source.

The provision of this circle is applicable from the current financial year.

2. 123 TAXMAN (St.) 32

SCHEME FOR BULK FILING OF RETURNS BY SALARIED EMPOYEES, 2002.

The CBDT vide Notification No. SO 661(2) dated 24/6/2002 gives the scheme for bulk filing of returns by salaried employees. The scheme is framed in exercise of the powers conferred by section 139(1A) of Income Tax Act.

The scheme is called the scheme for bulk filing of returns by salaried employees, 2002. It shall came into force from 1st day of July 2002. It is applicable to all eligible employers and their eligible employees assessed to tax.

Presently, the scheme is applicable in 16 cities as stated in the scheme.

The scheme defines "Eligible Employer" and "Eligible Employee".

It gives guidance for "Returns how to be furnished".
It gives guidance for "Type of returns to be received."
It gives "steps for the eligible employees" opting for the scheme.
It gives "steps for the eligible employer".
It gives guidance for "how to receive the returns under the scheme".
It provides information on how the "Processing of the return" will be carried.

3. 122 TAXMAN (St.) 176

AMENDMENT IN RULES 114B & 114C OF INCOME TAX RULES

Notification No. 149/2002 dated 19/6/2002 gives income tax (Eighth Amemdment) Rules, 2002. It amends rules 114B and 114C of the Income Tax Rules.

Rule 114B enumerates the various nature of transaction where every person is required to quote his permanent account number or general index register number in all documents pertaining to the specified transaction.

• It amends monetary limit under clause (e) of rule 114B, where every person is required to quote PAN/GIR NO. in documents pertaining to a contract for sale or purchase of securities, from value exceeding Rs. 10 lacs to Rs. 1 lacs.

It inserts further 3 clauses i.e. (i), (j) and (k). The clause (i) requires the transactions in the nature of payment in cash for purchase of bank draft or pay orders or bankers cheque from a bank for an amount aggregating 50,000/- or more during any one day.

The clause (j) requires the transaction in nature of deposit in cash aggregating 50,000/- or more with bank during any one day.

The clause (k) requires the transaction in a nature of payment in cash in connection with travel to any foreign country of an amount exceeding Rs. 25,000/- at any one time.

The "payment in cash inconnection with travel" meant to include payment in cash towards fare or to a travel agent or a tour operator or for the purpose of foreign currency. The expression "The travel to any foreign country" does not include places as may be specified by the board under explanation 3 of sub section 1 of section 139.

The corresponding amendment has also been made in rule 11C in Income Tax Rule 1962.

4. 122 TAXMAN (St.) 178

SUBSTITUTION OF RULE 114D OF INCOME TAX RULES 1962

Notification No. 150/2002 dated 19/6/2002 gives Income Tax (Ninth Amendment) Rules, 2002.

It amends and substitutes rule 114D of Income Tax Rules. It provides for the time and manner in which person referred to in sub-rule (2) of rule 114C shall intimate the details of transaction to the Director of Income Tax (Investigation) or Commissioner of Income Tax (Central Information Branch).

Every person referred to in rule 114C (2) is required to forward the following further documents in addition to the earlier requirements;

(a) A statement indicating therein details of all documents pertaining to any transaction referred to in clause (a) to (k) of rule 114B where payment is made in cash.

(b) The statement referred to in clause (a) shall contain:
(i) name and address of the person entering into the transactions.
(ii) nature and date of the transaction.
(iii) Amount of each transaction.
(iv) Permanent account number or General Index register No. quoted in the documents pertaining to any transaction.

5. 122 TAXMAN (St.) 179

INSERTION OF CLAUSE (viia) IN RULE 2BA OF INCOME TAX RULES 1962, AS REGARDS GUIDELINES FOR THE PURPOSE OF SECTION 10(10C)

Notification No. 151/2002 dated 19/6/2002 gives Income Tax (Tenth Amendment) Rules 2002. It amends and inserts clause (viia) to rule 2BA of Income Tax Rules. Rule 2BA provides for exemption in respect of amount received at the time of voluntary retirement by the employees of various classes of entities which are enumerated under clause (i) to (viii) of Rule 2BA.

It now inserts clause (viia) as under "(viia) an institution, having importance throughout India or in any State or states, as the Central Government may, by notification in the Official Gazette, specify in this behalf."

6. 122 TAXMAN (St.) 179

AMENDMENTS IN SUB RULE (1) AND (2) OF RULE 7B OF INCOME TAX RULES, 1962 AS REGARDS INCOME FROM THE MANU-FACTURERS OF COFFEE

Notification No. 152/2002 dated 19/6/2002 gives Income Tax (Eleventh Amendment) Rules 2002. It amends rule 7B of Income Tax Rules.

It deems 25% of the income liable to income tax in respect of income derived from sale of coffee grown and cured by the seller in India and shall be computed as if it were income derived from business.

It deems the 40% as the income liable to income tax in respect of income derived from the sale of coffee grown, cured, roasted and grounded by the seller in India with or without mixing chicory or other flavoring ingredients, and shall be computed as if it were income derived from business.

7. 122 TAXMAN (St.) 180

NOTIFIED INSTITUTE FOR EXEMPTION UNDER SECTION 10(10C)(viic) OF INCOME TAX ACT 1961 FOR REMUNERATION RECEIVED IN ACCORDANCE WITH SCHEME OF VOLUNTARY RETIREMENT.

The Central Government vide Notification No. 153/2002 dated 19/6/2002 notifies the international Crops Research Institute for the Semi Arid Tropics for the purposes of the clause 10(10C)(viic) of the Income Tax Act 1961 in respect of assessment year 2002-2003 and subsequent assessment years.

8. 122 TAXMAN (St.) 180

NOTIFIED COST OF INFLATION INDEX FOR FINANCIAL YEAR 2002-2003

Notification No. 154/2002 dated 19/6/2002 gives notified cost of inflation index as "447" for financial year 2002-2003. It accordingly amends notification SO709(E) dated 20/8/1998.

9. 122 TAXMAN (St.) 181

AMENDMENT IN FORM NOS. 15-G, 15-H AND 15-I OF APPENDIX II OF INCOME TAX RULES, 1962

Notification No. 158/2002 dated 20/6/2002 gives Income Tax (Twelth amendment) Rules, 2002. It amends Form No. 15-G, 15-H and 15-I. In accordance with amendment in Finance Act 2002, the wording of the form is amended in a manner that it requires the declarant to state that the aggregate of his various income for the year will not exceed maximum amount which is not chargeable to Income Tax.

10. 122 TAXMAN (St.) 182

AMENDMENT IN SUB RULES (1) OF RULE 12, INSERTION OF FORM NO. 2D AND AMENDMENTS IN FORM NO. 2 AND 3 OF APPENDIX II TO THE INCOME TAX RULES, 1962

Notification No. SO 659(E) dated 24/6/2002 gives Income Tax (Thirteenth Amendment) Rules, 2002

It amends rule 12(1) and Form 1, 2 and 3 of Income Tax Rules. It inserts the proviso to rule 12(1)(b) whereby it gives an option to non-corporate taxpayer to file the return of income in form 2D or Form 2/3 as the case may be.

It amends Form No. 2 and 3 to delete schedule "I" and schedule "h" respectively, as regards additional information requirement. It inserts new form 2D which is similar to the earlier form 2D.

11. 122 TAXMAN (St.) 161

EXEMPTIONS - LEAVE ENCASHMENT - INCREASE IN SPECIFIED AMOUNT

The Central Government vide Notification No. 123/2002 dated 31/5/2002 enhances exemption of specified amount of leave encashment referred to in section 10(10AA)(ii) of Income Tax Act 1961 from Rs. 2,40,000/- to Rs. 3,00,000/- in relation to the employees mentioned in clause (ii) who retires on superannuation or otherwise after 1st April, 1998.

12. 122 TAXMAN (St.) 162

NOTIFIED UNDERTAKING WHICH DEVELOPES, OPERATES AND MAINTAINS AN INDUSTRIAL PARK UNDER SECTION 80-IA(4)(III) OF THE INCOME TAX ACT

The Central Government vide Notification No. 124/2002 dated 31/5/2002, notifies an undertaking developed and being maintained and operated by M/s Tata Housing Development Corporation Ltd. as industrial park for the purpose of clause III of sub-section 4 of section 80IA of Income Tax Act.

13. 122 TAXMAN (St.) 165

SUBSTITUTION OF CLAUSES (a) AND (aa) IN RULE 6E OF INCOME TAX RULES, 1962

The Central Government vide Notification No. 145/2002 dated 10/6/2002 gives Income Tax (Seventh Amendment) Rules, 2002.

It substitutes rule 6E as under and which came into force from 1st April 2003.

(a) where the insurance business relates to fire insurance or engineering insurance and which provides insurance for terrorism risks, 100 percent of the net premium income of such business of the previous year.

(aa) where the insurance business relates to fire insurance or miscellaneous insurance other then the insurance business covered under clause (a), 50 percent of the net premium income of such business of the previous year.