Amendments by Lok Sabha in Finance Bill 2013 of Common Interest

Some important amendments of Common Interest

1.With the change in the definition of asset under section 2(ea) now Land classified as agricultural land in the records of the Government and used for agricultural purposes, will not be treated as an 'asset' under Section 2(ea) with retrospective effect from the AY 1993-94. Consequently, such land will not be chargeable to wealth-tax, even if such land is situated in an urban area.

As per the amended provision, following lands will not be chargeable to wealth-tax:

(1) Land classified as agricultural land in the records of the Government and used for agricultural purposes; or

(2) Land on which construction of a building is not permissible under any law for the time being in force in the area in which such land is situated; or

(3) Land occupied by any building which has been constructed with the approval of the appropriate authority; or

(4) An unused land held by the assessee for industrial purposes for a period of two years from the date of its acquisition by him; or

(5) Land held by the assessee as stock-in-trade for a period of 10 years from the date of its acquisition by him.

2.With effect from June 1, 2013, consideration of any coin or any other article weighing 10 grams or less shall not be excluded while calculating the monetary limit of Rs. 2,00,000.

3. Under the amended provisions of Section 206AA, in respect of payment of interest on long-term infrastructure bonds to a non-resident (as referred to in Section 194LC), tax will be deducted at the normal rate of 5%, even if the non-resident-recipient does not have PAN earlier it was 20%

4. new clause (e) is inserted in proviso to Section 43(5) wef assessment year 2014-15 to provide that trading in commodity derivatives carried out in a recognised association shall not be treated as 'speculative' transaction. For this purpose, an eligible transaction means:

(a)  Any transaction carried out electronically on screen-based system through a member registered for trading in commodity derivatives under the FCRA;

(b)  Transaction is supported by a time stamped note issued by such member;
(c)  The contract note should indicate unique client identity number, unique trade number and PAN.

5. The Finance Bill, 2013 approved of the provisions of Section 194-IA. However, it provided an exemption to the transferee from obtaining a TAN, which is otherwise a mandatory requirement for deduction of tax at source. Earlier it has been proposed that transferee is liable to deduct tax at source at 1% from payment being made to a resident-transferor in respect of purchase of an immovable property.