The Ministry of Finance, through the Central Board of Direct Taxes (CBDT), has introduced significant amendments to the Income-tax Rules, 1962, specifically targeting Form No. 3CD. This revision, detailed in Notification No. 27/2024-Income Tax, dated 5th March 2024, brings forth crucial alterations that taxpayers and practitioners must be aware of.
Key Changes in Form 3CD
Amendments to Part A
- Clause 8a now includes “115BAD/115BAE” instead of “115BAD” only.
Modifications in Part B
- Clause 12 expands to include “44AD, 44ADA.”
- Clause 18 incorporates adjustments under various sections for specific assessment years.
- Clause 19 sees additions to accommodate new sections.
- Clause 21 undergoes alterations regarding expenditures related to penalties and fines.
Enhancements in Part C of Form 3CEB
- Serial numbers and details regarding specified domestic transactions have been revised to align with the latest regulations.
Updates in Form No. 65
- Amendments include additional clauses related to verification and qualifying company status.
Effective Implementation and Compliance
The Income-tax (Fourth Amendment) Rules, 2024, come into force upon publication in the Official Gazette. Taxpayers and auditors must ensure timely adaptation to the revised Form 3CD to maintain compliance with the Income-tax Act, 1961.
Also read: Corrigendum to Income Tax notification no. 27 of 2024
Ministry Of Finance
(Department of Revenue)
(Central Board of Direct Taxes)
New Delhi
Notification No. 27/2024-Income Tax Dated: 5th March, 2024
G.S.R. 155(E).— In exercise of the powers conferred by section 295 read with sections 44AB and 92E of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely:-
1. (1) These rules may be called the Income-tax (Fourth Amendment) Rules, 2024.
(2) They shall come into force on the date of their publication in the Official Gazette.
2. In the Income-tax Rules, 1962, in Appendix II,––
a) in Form No. 3CD,––
(i) in PART A, in clause 8a, for the figures and letters “115BAD”, the figures and letters “115BAD/115BAE” shall be substituted;
(ii) in PART B,––
A. in clause 12, for the figures and letters “44AD”, the figures and letters “44AD, 44ADA” shall be substituted;
B. in clause 18, for sub-clause (ca), the following sub-clauses shall be substituted, namely:–– “(ca) Adjustment made to the written down value––
(i) under the proviso to sub-section (3) of section 115BAA (for assessment year 2020-21 only);
(ii) under the first proviso to sub-section (3) of section 115BAC or the proviso to sub-section (3) of 115BAD (for assessment year 2021-22 only);
(iii) under the second proviso to sub-section (3) of section 115BAC (for assessment year 2024-25 only).”;
C. in clause 19, in the table,––
(i) after the row with entry “35(2AB)”, the row with entry “35ABA” shall be inserted;
(ii) after the row with entry “35E”, the row with entry “any other relevant section” shall be inserted;
D. in clause 21, ––
(I) in sub-clause (a), in the table, under the column relating to ‘Nature’,––
(i) for the words “Expenditure by way of penalty or fine for violation of any law for the time being force”, the words and brackets “Expenditure for any purpose which is an offence or is prohibited by law or expenditure by way of penalty or fine for violation of any law (enacted in India or outside India)” shall be substituted;
(ii) after the row with the words “Expenditure by way of any other penalty or fine not covered above”, the row with the words “Expenditure incurred to compound an offence under any law for the time being in force, in India or outside India” shall be inserted;
(iii) for the words “Expenditure incurred for any purpose which is an offence or which is prohibited by law”, the words “Expenditure incurred to provide any benefit or perquisite, in whatever form, to a person, whether or not carrying on a business or exercising a profession, and acceptance of such benefit or perquisite by such person is in violation of any law or rule or regulation or guideline, as the case may be, for the time being in force, governing the conduct of such person” shall be substituted;
(II) in sub-clause (b), in paragraph (ii), in sub-paragraph (B), in item (IV), for the word “payer”, the word “payee” shall be substituted;
E. in clause 26, for the brackets, letters and word “(f) or (g)”, the brackets, letters and word “(f), (g) or (h)” shall be substituted;
‘E. in clause 22, after the figures “2006”, the words and figures “ or any other amount not allowable under clause (h) of section 43B of the Income-tax Act, 1961” shall be inserted;’.
F. in clause 32, in sub-clause (a),––
(I) in the table, in column (5), for the figures and letters “115BAD”, the figures and letters “115BAD/115BAE” shall be substituted;
(II) in the table, in column (6), for the figures and letters, “115BAD^”, the figures and letters “115BAD/115BAE^” shall be substituted;
(III) below the table, for the words and figures “To be filled in for assessment year 2021-22 only.”, the words and figures “To be filled in only for assessment year 2021-22 and 202425, as applicable.”, shall be substituted;
b) In Form No. 3CEB, in the Annexure thereto, in Part C (Specified domestic transaction), serial number 25 shall be re-numbered as serial number 26 thereof and before serial number 26 as so renumbered, the following shall be inserted, namely:—
|
“25. |
Particulars in respect of specified domestic transaction in the nature of any business transacted between the persons referred to in sub-section (4) of section 115BAE:
Has the assessee entered into any specified domestic transaction with any person referred to in sub-section (4) of section 115BAE which has resulted in more than ordinary profits expected to arise in such business? If ‘yes’, provide the following details : (a) Name of the person with whom the specified domestic transaction has been entered into. (b) Description of the transaction including quantitative details, if any. (c) Total amount received or receivable or paid or payable in the transaction– (i) as per books of account; (ii) as computed by the assessee having regard to the arm’s length price. (d) Method used for determining the arm’s length price [See sub-section (1) of section 92C]. |
Yes/No.”; |
c) In Form No. 65,––
(i) under the heading “Verification”, after clause (4), the following clause shall be inserted, namely:––
“ (5) *I certify that the applicant company is a unit of an International Financial Services Centre and has filed the application within three months from the date on which the deduction under section 80LA of the Income- tax Act, 1961 is no longer applicable.”;
(ii) in the Annexure, in PART A, for clause 6, the following clauses shall be substituted, namely:––
“ 6. Date on which the company became a qualifying company [to be given only in case of a company which becomes a qualifying company after the initial period] (enclose evidence in support of the claim)
6A. (a) Has the applicant company availed of deduction under section 80LA of the Income- tax Act, 1961?
(b) If so, please specify the date on which such deduction is no longer applicable?”.
[Notification No. 27/2024 /F. No. 370142/3/2024-TPL]
KHUSHBOO LATHER, Under Secy.
Note : The principal rules were published in the Gazette of India, Extraordinary, Part II, section 3, sub-section (ii), vide notification number S.O. 969 (E), dated the 26th March, 1962 and were last amended vide notification number G.S.R 153 (E), dated the 1st March, 2024.
