Highlights of Notifications dated 12.1.2004 in pursuance of announcements made by the Finance Minister on 8.1.2004

1. Notification No. S.O. 46(E) dated 12.1.2004 (w.e.f. 1.4.2004)
For change in rule 3(7)(i) providing that in respect of concessional loan for any purpose the rate of interest charged by SBI on loan for the same purpose on 1st day of the FY will be taken for valuation of perk.

2. Notification No. S.O. 47(E) dated 12.1.2004 (with immediate effect)
In TDS Certificate in Form No. 16, items 13 to 17 have been substituted.

3. Notification No. S.O. 48(E) dated 12.1.2004 (w.e.f. 1.4.2004)
New Rule 28AB inserted to provide for the procedure for issue of certificate of no deduction of tax at source in case of

a) persons in receipt of income derived from property held under trust claiming exemption u/s 11 or 12, or
b) in case of a scientific research association, news agency, association or institution, fund or trust or University or other educational institution or any hospital or other medical institution or trade union referred to in section 139(4C).
The AO may issue the certificate u/s 197(1) authorizing the above persons to receive income without TDS on fulfilling prescribed conditions as mentioned in Rule 28AB(2).

4. Notification No. S.O. 49(E) dated 12.1.2004 (with immediate effect)
To substitute items in Form No. 49B for item 8 (Nature of Collections u/s 206C)

a) 3rd proviso inserted in rule 12, to provide that an assessee having salary income of upto Rs. 1.5 Lakhs and not having income from business, capital gain or agriculture or any other income (other than on which tax has been deducted by the employer) may also have the option of filing return in Form No. 16AA.
b) Rule 31(1)(a) amended to provide that Certificate of TDS may be issued in Form 16AA in cases mentioned in (a) above.
c) New Form 16AA has been prescribed.

6. Notification No. S.O. 51(E) dated 12.1.2004 (w.e.f. 1.4.2004)
New scheme for filing of returns by salaried employees through employer, 2004 notified. An assessee having salary income of upto Rs. 1.5 Lakhs and not having income from business, capital gain or agriculture or any other income from which tax has been deducted by any person (other than the employer) may also have the option of filing return through his employer in Form No. 16AA.

7. Notification No. S.O. 52(E) dated 12.1.2004 (w.e.f. 1.4.2004)
Rule 2E containing guidelines for approval u/s 10(23G) substituted. Application shall be made in Form No. 56E.

8. Notification No. S.O. 53(E) dated 12.1.2004 ( with immediate effect)
The Board has specified that the provisions of filing return under one by six scheme shall not apply to individuals who have income from pension but are not engaged in any business or profession during the previous year.

Highlights of changes in Indirect Taxation announced by Finance Minister on 8th January 2004:

• Peak customs duty on non-farm goods cut by 5 % to 20 %.
• 4 % special additional duty (SAD) of Customs abolished.
• Excise duty on aviation turbine fuel halved to 8 %.
• Inland Air Travel Tax of 15 % abolished.
• Customs duty on cellphones halved to 5 %
• Excise duty on computers halved to 8 %.
• Customs duty on coal cut by 10 %to 15 %.
• Customs duty on power equipment cut by 15 %to 10 %.
• Duty on life saving drugs and equipment cut to 5 %.
• Peak rate of customs duty on non-agricultural goods reduced from 25 % to 20 %
• Customs duty on project imports with investment of at least Rs 5 crores, in plant and machinery, reduced from 25 %to 10 %
• Customs duty on coal reduced from 25 %to 15 %
• Customs duty on nickel and articles thereof reduced from 10 %to 5 %
• Customs duty on power transmission and distribution projects reduced from 25 % to 10%
• Customs duty on electricity meters reduced from 25 % to 15 %
• Duty on 6 items (namely VCD/VCR, washing machines, personal computers, laptop computers, refrigerators of capacity up to 300 L and cooking range) under Transfer of Residence made duty free.
• Duty on 17 items under Transfer of Residence reduced from 30 % to 15 %.
  Import of cinematographic films, exposed but not developed, imported as part of baggage, made duty free.
• Quantity of alcoholic liquor/wines allowed duty free under baggage increased from 1 litre to 2 litres.
• Laptops brought as part of baggage exempted from customs duty.
• Manufacturers will now be allowed to remove semi-finished goods and finished goods for further processing or testing, without payment of excise duty.
• Electronic filing of service tax returns, presently allowed only in respect of 10 services, is being extended to all the 58 taxable services.
• Service providers providing more than one taxable service will be allowed to take single registration and file a single return.
• Only a simple verification will now be made for grant of registration for service tax. Round-the-clock electronic filing of customs documents for clearance of goods, presently available in 9 customs formations, extended to 23 customs formations.
• Customs clearances will be based on self-assessment and selective examination. Customs duty on specified life-saving bulk drugs, formulations, medical equipments reduced to 5 %. These items are also exempted from countervailing duty by way of excise duty exemption.
• Customs duty on parts of artificial limbs and specified rehabilitation aids reduced to 5%. These items are also exempted from CVD by way of excise duty exemption.
• Excise duty on medical, surgical, dental and veterinary furniture is being reduced from 16 % to 8%.
• Mosquito nets treated with pesticide are being exempted from excise duty.
• Customs duty on Information Technology Agreement-bound items reduced
• Customs duty on specified raw materials/inputs used for manufacture of electronic components or optical fibres/cables reduced from 15 % / 5 % to 5 % / nil.
• Customs duty on specified capital goods used for manufacture of electronic goods reduced from 15 % /10 % to nil.
• Specified infrastructure equipment for basic/cellular/Internet, V-SAT, radio paging and public mobile radio trunked services and parts of such equipments exempted from basic customs duty.
• Customs duty on cellphones is being reduced from 10 % to 5 %
• Excise duty on computers reduced from 16 % to 8 %.
• Recorded video compact discs and digital videodiscs exempted from excise duty.