NOTIFICATION NO. 338/2006, DATED 16-11-2006

In exercise of the powers conferred by clause (42) of section 10 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies, –

1. (a) the Secretariat of Indian Ocean Memorandum of Understanding on Port State Control, 38-A, Galliant, Bogmalo Road, Dabolim, Goa as the body;

(b) any income arising to the Secretariat of Indian Ocean Memorandum of Understanding on Port State Control, by way of interest on deposits with a banking company to which the Banking Regulation Act, 1949 (10 of 1949) applies, as the specified income, for the purposes of the said clause.

2. This notification shall be applicable for assessment year 2006-07 and subsequent assessment years.

Explanatory Memorandum:

It is proposed to notify the Secretariat of Indian Ocean Memorandum of Understanding on Port State Control as the body and any income arising to the said Secretariat by way of interest on deposits with a banking company to which the Banking Regulation Act, 1949 (10 of 1949) applies as the specified income for the purposes of clause (42) of section 10 of the Income-tax Act, 1961. The proposed notification shall be applicable for assessment year 2006-07 and subsequent assessment years.

Clause (42) of section 10, which was inserted, vide the Finance Act, 2006 with retrospective effect from the 1st day of April, 2006, provides that any specified income arising to a notified body or authority established or constituted or appointed under a treaty or an agreement entered into by the Central Government with two or more countries or a convention signed by the Central Government and is established or constituted or appointed not for the purpose of profit shall not be included in the total income of such body or authority.

Any income arising by way of bank interest to the Secretariat of Indian Ocean Memorandum of Understanding on Port State Control which would otherwise be taxable for the financial year 2005-06 is proposed to be exempted from income-tax. The Present notification is therefore proposed to be made applicable retrospectively for assessment year 2006-07 and subsequent assessment years.

It is certified that no asseessee is likely to be prejudicially affected by this notification being given retrospective effect.

[F. No. 149/186/2005-TPL]

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