The Finance Bill, 2021 has been passed in the Lok Sabha on 23rd March, 2021 with certain amendments under Direct and Indirect Taxes.
Key Points of the Amendment are:
1. Section 44AB of the Income tax Act, 1961 was proposed to be amended by Finance Bill, 2021 to increase the threshold limit for tax audit from INR 5 crore to INR 10 crore in case of assesses where cash transactions do not exceed 5%, w.e.f 1st day of April, 2021. In this context it has been further clarified that if the payment or receipt is executed through a cheque drawn on a bank or by bank draft which is not account payee, shall be deemed to be payment or receipt, as the case may be, in cash.
2. Sub Section (1) of Section 234F has been substituted to provide that where a person was required to furnish a return of Income under Section 139 fails to do so within the prescribed time limit then he shall pay the fees of sum of INR 5,000. It has further been provided that if the total income of the person does not exceed INR 5 lakhs, then the fees payable shall not exceed INR 1,000. Currently, the prescribed time limit to pay INR 5,000 if the return is furnished on or before the 31st day of December of the assessment year or INR 10,000 in any other case has been done away with.
3. After Section 234G, a new Section 234H has been inserted relating to “Fee for default relating to Intimation of Aadhaar Number” to provide that where a person who has been allotted permanent account number as on the 1st day of July, 2017, and who is eligible to obtain Aadhaar number is required to intimate his Aadhaar number to such authority in such form and manner as may be prescribed, on or before a date to be notified by the Central Government in the Official Gazette and has failed to do on or before such date as may be prescribed then he shall be liable to pay such fees as may be prescribed not exceeding INR 10,000 at the time of making such intimation after such date.
4. Sub Section (2) of Section 50B relating to Special provision for computation of capital gains in case of slump sale has been amended to provide that in relation to capital assets being an undertaking or division transferred by way of such sale, the fair market value of the capital asset as on the date of transfer calculated in the prescribed manner shall be the full value of consideration received or accruing as a result of transfer of such capital asset. Also an explanation has been added after clause a to provide for the computing the net worth where the aggregate value of total assets shall be in the case of capital asset being goodwill of a business or profession which has not been acquired by the assessee by purchase from a previous owner shall be NIL.
Source: Ministry of Finance
