Budget 2016: Section 115BBE of the Act, inter-alia provides that the income relating to section 68 or section 69 or section 69A or section 69B or section 69C or section 69D is taxable at the rate of thirty per cent and further provides that no deduction in respect of any expenditure or allowances in relation to income referred to in the said sections shall be allowable.
Currently, there is uncertainty on the issue of set-off of losses against income referred in section 115BBE of the Act. The matter has been carried to judicial forums and courts in some cases has taken a view that losses shall not be allowed to be set-off against income referred to in section 11 5BBE. However, the current language of section 11 5BBE of the Act does not convey the desired intention and as a result the matter is litigated. In order to avoid unnecessary litigation, it is proposed to amend the provisions of the sub-section (2) of section 11 5BBE to expressly provide that no set off of any loss shall be allowable in respect of income under the sections 68 or section 69 or section 69A or section 69B or section 69C or section 69D.
This amendment will take effect from 1stApril, 2017 and will, accordingly, apply in relation to the assessment year 2017-18 and subsequent years.
Clause 51 of Finance Bill 2016
Clause 51 of the Bill seeks to amend section 1 15BBE of the Income-tax Act relating to tax on income referred to in section 68 or section 69 or section 69A or section 69B or section 69C or section 69D.
Sub-section (1) of the section 1 15BBE, inter alia, provides that the income relating to the above referred sections are taxable at the rate of thirty per cent. Sub-section (2) of the said section 11 5BBE provides that no deduction in respect of any expenditure or allowances in relation to income referred to in the aforesaid sections shall be allowable.
It is proposed to amend the said sub-section (2) of section 11 5BBE so as to provide that the set off of any loss shall also be not allowable in respect of income under the aforesaid sections.
This amendment will take effect from 1st April, 2017 and will, accordingly, apply in relation to the assessment year 2017-2018 and subsequent years.
