Proposed Amendments in the Finance Bill, 2018

Feb 02, 2018 | by Avantis RegTech Legal Research Team

The Insolvency and Bankruptcy Board of India (IBBI) published the following amendments in the Income Tax Act, 1961 which have been proposed in the Finance Bill, 2018:

1.    Section 79 of the Income-tax Act: Carry forward and set off of losses in the case of certain companies

 After the second proviso, the following proviso shall be inserted, namely:––

“Provided also that nothing contained in this section shall apply to a company where a change in the shareholding takes place in a previous year pursuant to a resolution plan approved under the Insolvency and Bankruptcy Code, 2016, after affording a reasonable opportunity of being heard to the jurisdictional Principal Commissioner or Commissioner.”

These amendments will take effect from 1st April, 2018 and will, accordingly, apply in relation to the assessment year 2018-2019 and subsequent years.

2.    Section 115JB of the Income-tax Act:Special provision for payment of tax by certain companies

 (a) in Explanation 1,—

(A) after clause (iig), the following clause shall be inserted, namely:––

‘(iih) the aggregate amount of unabsorbed depreciation and loss brought forward in case of a company against whom an application for corporate insolvency resolution process has been admitted by the Adjudicating Authority under section 7 or section 9 or section 10 of the Insolvency and Bankruptcy Code, 2016.

Explanation

For the purposes of this clause, the expression “Adjudicating Authority” shall have the meaning assigned to it in clause (1) of section 5 of the Insolvency and Bankruptcy Code, 2016 and the loss shall not include depreciation; or’;

(B) in clause (iii), after the words “books of account”, the words, brackets, figures and letter “in case of a company other than the company referred to in clause (iih)” shall be inserted.

These amendments will take effect from 1st April, 2018 and will, accordingly, apply in relation to the assessment year 2018-2019 and subsequent years.

Section 140 of the Income-tax Act:Return by whom to be verified

 In clause (c), in the second proviso,–

(A) in clause (b), after the words “principal officer thereof;” occurring at the end, the word “or” shall be inserted;

(B) after clause (b), the following shall be inserted, namely:––

‘(c) where in respect of a company, an application for corporate insolvency resolution process has been admitted by the Adjudicating Authority under section 7 or section 9 or section 10 of the Insolvency and Bankruptcy Code, 2016, the return shall be verified by the insolvency professional appointed by such Adjudicating Authority.

Explanation.––For the purposes of this clause the expressions “insolvency professional” and “Adjudicating Authority” shall have the respective meanings assigned to them in clause (18) of section 3 and clause (1) of section 5 of the Insolvency and Bankruptcy Code, 2016;

These amendments will take effect from 1st April, 2018.

 

URL: http://ibbi.gov.in/webadmin/pdf/whatsnew/2018/Feb/Amendment_Finance%20Bill%202018-1_2018-02-01%2023:05:51.pdf


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