Draft Rule 139 of the Income-tax Rules, 2026 prescribes a formula-based method to compute exempt income of specified funds attributable to non-resident unit holders. Exemption is conditional upon proportionate AUM ratios and mandatory filing of Form 68.
Draft Rule 140 prescribes a formula-based mechanism to determine income of specified funds attributable to non-resident unit holders, making concessional tax rates conditional on proportionate AUM ratios and filing of Form 69.
Rule 118 introduces a structured computation mechanism to reduce tax payable when past income from APA or secondary adjustments is included in book profits, ensuring no excess tax burden while adjusting tax credit accordingly.
Rules 119 and 120 clarify renewal of agreements via fresh Form 54 application and confirm Chapter X applies until execution, with treaty-based negotiation for bilateral deals.
Rule 117 requires filing of modified returns, payment of additional tax, and withdrawal of pending appeals to give effect to rollback provisions, failing which the agreement may be cancelled.
Rules 115 and 116 empower the Board to revise or cancel agreements where conditions fail, laws change, or compliance lapses occur, while mandating hearings, written reasons, and procedural safeguards to ensure transparency.
Rule 100 mandates minimum profit margins of 4% and 2% for specified businesses to qualify for safe harbour, while restricting deductions and loss set-offs to ensure certainty and simplified taxation.
Rule 99 defines eligible assessees, businesses, goods, and gross receipts for safe harbour in income attribution cases, covering foreign diamond miners and electronics manufacturing through custom bonded warehouses.
Rule 98 introduces a structured filing, verification, and appeal mechanism with strict timelines, ensuring deemed acceptance of safe harbour for specified domestic transactions if authorities fail to act within prescribed periods.
Rule 97 allows automatic acceptance of transfer prices for specified domestic transactions where electricity tariffs are regulator-approved and milk pricing is quality-based and transparent, eliminating comparability adjustments.
