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FINANCE (NO. 2) ACT, 1967

FINANCE (NO. 2) ACT, 1967

20 of 1967

5th August, 1967

An Act to give effect to the financial proposals of the Central Government for the financial year 1967-68. Be it enacted by Parliament in the Eighteenth Year of the Republic of India as follows:--

SECTION 01: SHORT TITLE AND COMMENCEMENT

(1) This Act may be called The Finance (No. 2) Act, 1967.

(2) Save as otherwise provided in this Act, sections 2-to36-and44-to46-shall be deemed to have come into force on the 1st day of April, 1967.

SECTION 02: INCOME TAX

(1) Subject to the provisions of sub-sections (2), (3) and (4), the assessment year commencing on the 1st day of April, 1967, income-tax shall be charged at the rates specified in Part I of the First Schedule and, in the cases to which paragraphs A, B, C and D of that Part apply, shall be increased by a surcharge for purposes of the Union and a special surcharge for purposes of the Union calculated in either case in the manner provided therein.

(2) In making any assessment for the assessment year commencing on the 1st day of April, 1967, where the total income of a company, other than the Life Insurance Corporation of India established under the Life Insurance Corporation Act, 1956-, includes an) profits and gains from life insurance business, the income-tax payable by it shall be the aggregate or the income-tax calculated-

(i) on the amount of profits and gains from life insurance business so included, at the rate applicable in the case of the Life Insurance Corporation of India, in accordance with paragraph E of Part I of the First Schedule, to that part of its total income which consists of profits and gains from life insurance business; and

(ii) on the remaining part of its total income, at the rate applicable to the company on its total income.

(3) In cases to which Chapter XII of the Income-tax Act 1961-(hereinafter referred to as the Income-tax Act) applies, the tax chargeable shall be determined as provided in that Chapter and with reference to the rates imposed by sub-section (1) or the rates as specified in that Chapter, as the case may be.

(4) (a) In respect of any assessment for the assessment year commencing on the 1st day of April, 1967, in the case of an assessee being a domestic company or an assessee other than a company,-

(i) where his total income includes any profits and gains derived from the export (made before the sixth day of June, 1966) of any goods or merchandise out of India, he shall be entitled to a deduction, from the amount of income-tax with which he is chargeable, of an amount equal to the income-tax calculated at one-tenth of the average rate of income-tax on the amount of such profits and gains included in his total income;

(ii) where he is engaged in the manufacture of any articles in an industry specified in the First Schedule to the Industries (Development and Regulation) Act, 1951, and has. during the previous year, exported before the sixth day of June, 1966 such articles out of India, he shall be entitled, in addition to the deduction of income-tax referred to in sub-clause (i), to a further deduction, from the amount of income-tax with which he is chargeable for the assessment year, of an amount equal to the income-tax calculated a the average rate of

income-tax on an amount equal to two per cent of the sale proceed' receivable by him in respect of such export made before the date aforesaid.

(iii) where he is engaged in the manufacture of any articles in an industry specified in the said First Schedule and has, during the previous year, sold before the sixth day of June, 1966, such articles to any other person in India who himself has exported them out of

India, and evidence is produced before the Income-tax Officer of such articles having been so exported, the assessee shall be entitled to a deduction, from the amount of income-tax with which he is chargeable for the assessment year of an amount equal to the income-tax calculated at the average rate of income -tax on a sum equal to two per cent of the sale proceeds receivable by him from the exporter in respect of such articles sold to the exporter before the date aforesaid.

(b) The aggregate amount of the deductions under this sub-section shall in no case exceed the amount of income-tax otherwise payable by the assessee.

(1) fuels,

(2) fertilisers,

(3) photographic raw film and paper,

(4) textiles (including those dyed, printed or otherwise processed) made wholly or in part of jute, including jute twine and rope,

(5) newsprint,

(6) pulp-wood pulp, mechanical, chemical, including dissolving pulp,

(7) sugar,

(8) vegetable oils and vanaspathi,

(9) cement and gypsum products,

(10) arms and ammunition, and

(11) cigarettes,

respectively, specified in items 2, 18, 20, 23(2), 24(2), 24(5), 25, 28, 35, 37 and 38 of the First Schedule to the Industries (Development and Regulation) Act, 1951.

(d) The amount of any profits and gains derived from the export of any goods or merchandise out of India in respect of which deduction of income-tax is admissible under sub -clause (i) of clause (a) shall be computed in accordance with the rules made by the Board in this behalf.

(5) In cases in which tax has to be deducted under sections 193-,194-,194A-and195 of the Income-tax Act-at the rates in force, the deduction shall be made at the rates specified in Part II of the First Schedule.

(6) In cases in which income-tax has to be calculated under the first proviso to sub- section (5) of section 132 of the Income-tax Act-or charged under sub-section (4) of section 172-or sub-section (2) of section 174-or section 175-or sub- section (2) of section 176-or deducted under section 192 of the said Act-from income chargeable under the head "Salaries" or in which the "advance tax" payable under Chapter XVII-C of the said Act has to be computed, at the rate or rates in force, such income-tax or, as the case may be, "advance tax" shall be so calculated, charged, deducted or computed at the rate or rates specified in Part III of the First Schedule.

(7) For the purposes of this section and the First Schedule,-

(a) "company in which the public are substantially interested" means a company which is such a company as is referred to in section 108 of the Income-tax Act-;

(b) "domestic company" means an Indian company, or any other company which, in respect of its income liable to income-tax under the Income-tax Act for the assessment year commencing on the 1st day of April, 1967, has made the prescribed arrangements for the declaration and payment within India of the dividends (including dividends on preference shares) payable out of such income in accordance with the provisions

of section 194-of that Act;

(c) "earned income" means any income of an assessee who is an individual, or a Hindu undivided family, or an unregistered firm [not being an unregistered firm assessed under clause (b) of section 183 of the Income-tax Act-] or an association of persons or body of individuals, whether incorporated or not, not being-

(A) a company, or

(B) a local authority, or

(D) an unregistered firm assessed under clause (b) of the said section 183--

(i) which is chargeable under the head "Salaries"; or

(ii) which is chargeable under the head "Profits and gains of business or profession" where the business or profession is carried on by the assessee or, in the case of a firm, where the assessee is a partner actively engaged in the conduct of the business or

profession; or

(iii) which is chargeable under the head "Income from other sources" if it is immediately derived from personal exertion or represents a pension or superannuation or other allowance given to the assessee in respect of the past services of any deceased

person, or which is chargeable under that head under clause (ia) of sub-section (2) of section 56 of the Income-tax Act-, and includes any such income which, though it is the income of another person, is included in the assessee's total income under the

provisions of the Income-tax Act, but does not include any such income on which income-tax is not payable under clause (iii) or clause (v) of section 86 of that Act or which is exempted from tax under a Notification issued under section 60-orsection

60A of the Indian Income-tax Act, 1922-, as continued in force by clause ( 1) of sub -section (2) of section 297 of the Incometax Act-;

(d) "Industrial company" means a company which is mainly engaged in the business of generation or distribution of electricity or any other form of power or in the construction of ships or in the manufacture or processing of goods or in mining.

(e) "tax-free security" means any security of the Central Government issued or declared to be income-tax-free or any security of a State Government issued income-tax-free, the income-tax whereon is payable by the State Government:

(f) "unearned income" means income which is not "earned income";

(g) all other words and expressions used in this section and the First Schedule but not defined in this sub - section and defined in the Income-tax Act, shall have the meanings respectively assigned to them in that Act.

SECTION 03: ANNUITY DEPOSIT

(1) Save as otherwise provided inChapter XXIIA of the Income- tax Act-, annuity deposit for the assessment year commencing on the 1st day of April, 1967 and annuity deposit to be made during the financial year commencing on the 1st day of April, 1967, shall be made by every person to whom the provisions of that Chapter apply, at the rate or rates specified in the Second Schedule.

(2) For the purposes of this section and the Second Schedule, the expressions "adjusted total income," "annuity deposit" and "depositor" have the meanings respectively assigned to them under clauses (1), (5) and (6) of section 280B of the Income-tax Act-.

SECTION 04: 04-32 AMENDMENTS OF ACT 43 OF 1961

[Note.- These sections amended the Income-tax Act, 1961, which amendments were incorporated in that Act.]

SECTION 33: CERTAIN AMENDMENTS TO INCOME-TAX ACT TO TAKE EFFECT FROM 1ST APRIL, 1968 –

The amendments directed in the Third Schedule shall be made in the Income-tax Act with effect from the 1st day of April, 1968.

SECTION 34: AMENDMENT OF ACT 27 OF 1957

[Note.- This section amended the Wealth-tax Act, 1957. These amendments were incorporated in that Act, then.]

SECTION 35: AMENDMENT OF ACT 18 OF 1958

[Note.- This section amended the Gift-tax Act, 1958. These amendments were incorporated in that Act.]

SECTION 36: AMENDMENT OF ACT 7 OF 1964

[Note.- This section amended the Companies (Profits) Surtax Act, 1964. These amendments were incorporated in that Act.]

SECTION 37: AMENDMENT OF ACT 32 OF 1934

[This Act is now repealed by the Customs Tariff Act, 1975.]

SECTION 38: SPECIAL DUTIES OF CUSTOMS

[This section related to levy of duty underthe Indian Tariff Act, 1944, which now stands repealed and replaced bythe Customs Tariff Act, 1975(51 of 1975-).]

SECTION 39: REGULATORY DUTIES OF CUSTOMS

(1) With a view to regulating or bringing greater economy in imports, there shall be levied and collected, with effect from such date, and at such rate, as may be specified in this behalf by the Central Government by Notification in the Official Gazette, on all or any of the goods mentioned in the First Schedule to the Tariff Act or in that Schedule as amended by a subsequent Central Act, if any, a regulatory duty of customs not exceeding-

(a) 25 per cent of the rate, if any, specified in the said First Schedule read with any notification issued under section 3A or sub-section (1) of section 4 of the Tariff Act; or

(b) 10 per cent of the value of the goods as determined in accordance with the provisions of section 14 of the Customs Act, 1962-, whichever is higher: Provided that different dates and different rates may be specified by the Central Government for different kinds of goods.

(2) Sub-section (1) shall cease to have effect after the 15th day of May, 1968, except as respects things done or omitted to be done before such cesser; andsection 6 of the General Clauses Act, 1897-, shall apply upon such cesser as if the said sub-section had then been repealed by a Central Act.

(3) The regulatory duty of customs leviable under this section in respect of any goods referred to in sub-section (1) shall be in addition to any other duty of customs chargeable on such goods underthe Customs Act. (4) The provisions ofthe Customs Act, 1962-and the rules and regulations made thereunder, including those relating to refunds and exemptions from duties, shall, as far as may be, apply in relation to the levy and collection of the regulatory duty of customs leviable under this section in respect of any goods as they apply in relation to the levy and collection of the duties of customs on such goods under that Act or those rules and regulations.

(5) Every Notification issued under sub-section (1) shall, as soon as may be after it is issued, be placed before each House of Parliament.

SECTION 40: AMENDMENT OF ACT 1 OF 1944

[Note.- This section amends the Central Excises and Salt Act, 1944, which amendments were incorporated in that Act.]

SECTION 41: SPECIAL DUTIES OF EXCISE ON CERTAIN GOODS

(1) When goods of the description mentioned in this section chargeable with a duty of excise under the Central Excises Act (as amended by this Act or any subsequent Central Act) read with any Notification, for the time being in force, issued by the Central Government in relation to the duly so chargeable, are assessed to duty, there shall be levied and collected-

(a) as respects goods comprised in Items Nos. 6, 8, 9, 14D, 22A, 23A except sub-item (1) thereof, 23B, 28, 29. sub -items (2) and (3) of Item No. 31 and Item No. 32 of the First Schedule to the Central Excises Act, a special duty of excise equal to 10 per cent of the total amount so chargeable on such goods:

(b) as respects goods comprised in Items Nos. 2, 3(1), sub-items 1, 11(2) and 11(3) of Item No. 4, Items Nos. 13, 14, 14F, 15, 15A, 15B, 16, 16A, 17, 18A(2), 21,22,23,23A(1), 27, 30, 31(1), 33, sub-items (1), (3a) and (4) of Item No. 34 and Item No. 37 of that Schedule, a special duty of excise equal to 20 per cent of the total amount so chargeable on such goods; and

(c) as respects goods comprised in Items Nos. 4, 11(1), 18. 18A(1), 18B, 20, 29A, 33A. sub-items (2) and (3) of Item No. 34 and radiograms comprised in Item No. 37 A of that Schedule, a special duty of excise equal to 33 1/3 per cent of the total amount so chargeable on such goods.

(2) Sub-section (1) shall cease to have effect after the 31st day of March, 1968, except as respects things done or omitted to be done before such cesser; andsection 6 of the General Clauses Act, 1897-. shall apply upon such cesser as if the said sub-section had then been repealed by a Central Act.

(3) The duties of excise referred to in sub-section (1) in respect of the goods specified therein shall be in addition to the duties of excise chargeable on such goods under the Central Excises Act or any other law for the time being in force and such special duties shall be levied for purposes of the Union and the proceeds thereof shall not be distributed among the States.

(4) The provisions of the Central Excises Act and the rules made thereunder, including those relating to refunds and exemptions from duties, shall, as far as may be, apply in relation to the levy and collection of the duties of excise leviable under this section in respect of any goods as they apply in relation to the levy and collection of duties of excise on such goods under that Act or those rules.

SECTION 42: REGULATORY DUTIES OF EXCISE

(1) With a view to regulating or bringing greater economy in consumption, there shall be levied and collected, with effect from such date, and at such rate as may be specified in this behalf by the Central Government by Notification in the Official Gazette, on all or any of the goods, mentioned in the First Schedule to the Central Excises Act as amended by this Act or any subsequent Central Act, a regulatory duty of excise which shall not exceed 15 per cent of the value of the goods as determined in accordance with the provisions of section 4 of the Central Excises Act-: Provided that different dates and different rates may be specified by the Central Government for different kinds of goods.

(2) Sub-section (1) shall cease to have effect after the 15th day of May, 1968, except as respects things done or omitted to be done before such cesser: andsection 6 of the General Clauses Act, 1897-, shall apply upon such cesser as if the said sub-section had been repealed by a Central Act.

(3) The duties of excise referred to in sub-section (1) in respect of the goods specified therein shall be in addition to the duties of excise chargeable on such goods under the Central Excises Act or any other law for the time being in force and such regulatory duties shall be levied for purposes of the Union and the proceeds thereof shall not be distributed among the States.

(4) The provisions of the Central Excises Act and the rules made thereunder, including those relating to refunds and exemptions from duties shall, as far as may be, apply in relation to the levy and collection of the regulatory duties of excise leviable under this section in respect of any goods as they apply inrelation to the levy and collection of the duties of excise on such goods under that Act or those rules.

(5) Every Notification issued under sub-section (1) shall, as soon as may be after it is issued, be placed before each House of Parliament.

SECTION 43: AMENDMENT OF ACT 6 OF 1898

[Note.- This section amended First Schedule to the Indian Post Office Act, 1898. These amendments were incorporated in that Act.]

SECTION 44: AMENDMENT OF ACT 47 OF 1961

[Note.- This section amended the Deposit Insurance Corporation Act, 1961. These amendments were then incorporated in that Act. This Act is now known asthe Deposit Insurance and Export Guarantee Corporation Act, 1961-]

SECTION 45: CERTAIN AMENDMENTS MADE IN ACT 52 OF 1963 BY ACT 17 OF 1966 TO BE GIVEN RETROSPECTIVE EFFECT

Notwithstanding anything contained in any law for the time being in force or any notification issued thereunder, the amendments made insection 32 of the Unit Trust of India Act, 1963-,by section 10 of the Unit Trust of lndia(Amendment)Act, 1966,shall be deemed to have been made with effect from the 1st day of April, 1964.

SECTION 46: RECOVERY OF TAX ON INCOME VOLUNTARILY DISCLOSED

Notwithstanding anything contained insection 68 of the Finance Act, 1965--

(a) any income-tax which is payable by a person on the amount of income declared by him under the provisions of sub-section ( 1 ) of that section but has not been paid within the period referred to therein (such tax being hereafter in this section referred to as the outstanding tax) shall be deemed to be tax due from the declarant on the date next following the expiry of the said period under a notice of demand issued under section 156 of the Income-tax Act-, and the provisions of Chapter XV and Chapter XVIID of, and the Second Schedule and the Third Schedule to, that Act shall, so far as may be, apply accordingly, subject to the modification that insection 231 of the said Act-, references to one year shall be construed as references to two years; and (b) the outstanding tax which is paid at any time after the expiry of the period referred to in subsection (1) of the said section 68 or is recovered under the provisions of clause (a) shall, for the purposes of sub-section (6) of the said section 68, be deemed to be tax paid by the declarant under

that section.

SECTION 47: REPEAL

Section 2-andsection 3 of the Finance Act, 1967-, are hereby repealed and shall be deemed never to have been enacted.

SCHEDULE 01: THE SCHEDULE

PART 01: INCOME TAX AND SURCHARGES ON INCOME TAX

Paragraph A In the case of every individual or Hindu undivided family or unregistered firm or other association of persons or body of individuals, whether incorporated or not, or every artificial juridical person referred to in sub-clause(vii) of clause (31 ) of section 2 of the Income-tax Act-, not being a case to which any other paragraph of this part applies,-

Rates of Income-tax

(1) where the total income does not exceed Rs. 5,000. 5 per cent of the total income; (2) where the total income exceeds Rs. 5,000 but does not Rs. 250 plus 10 per cent of the amount by which the total exceed Rs. 10,000. income exceeds Rs. 5,000; (3) where the total income exceeds Rs. 10,000 but does Rs. 750 plus 15 per cent of the amount by which the total not exceed Rs. 15,000. income exceeds Rs. 10,000; (4) where the total income exceeds Rs. 15,000 but does Rs. 1,500 plus 20 per cent of the amount by which

the not exceed Rs. 20,000. total income exceeds Rs. 15,000; (5) where the total income exceeds Rs. 20,000 but does Rs. 25,000 plus 30 per cent of the amount by which the not exceed Rs. 25,000. total income exceeds Rs. 20,000; (6) where the total income exceeds Rs. 25,000 but does Rs. 4,000 plus 40 per cent of the amount by which the not exceed Rs. 30,000. total income exceeds Rs. 25,000; (7) where the total income exceeds Rs. 30,000 but does Rs. 6,000 plus 50 per cent of the amount by which the not exceed Rs. 50,000. total income exceeds Rs. 30,000; (8) where the total income exceeds Rs. 50,000 but does Rs. 16,000 plus 60 per cent of the amount by which the not exceed Rs. 70,000. total income exceeds Rs. 50,000; (9) where the total income exceeds Rs. 70,000. Rs. 28,000 plus 65 per cent of the amount by which the total income exceeds Rs. 70,000; Provided that, for the purposes of this paragraph, in the case of a person, not being a non-resident- (i) no income-tax shall be payable on a total income not exceeding the following limit, namely : - (a) Rs. 7,000 in the case of every Hindu undivided family which as at the end of the previous year satisfies either of the following two conditions, namely: (1) that it has at least two members entitled to claim partition who are not less than eighteen years of age; or (2) that it has at least two members entitled to claim partition who are not lineally descended one from the other and who are not lineally descended from any other

living member of the family; (b) Rs. 4,000 in every other case; (ii) where such person is an individual or a Hindu undivided family, the income-tax computed at the rate hereinbefore specified shall be reduced by so much of the amount specified hereunder, as does not exceed the amount of income-tax so computed :- (a) Rs. 125 in the case of an unmarried individual (b) Rs. 200 in the case of a married individual who has no child mainly dependent on him or a Hindu undivided family which has no minor coparcener; (c) Rs. 220 in the case of a married individual who has one child mainly dependent on him or a Hindu undivided family which has one minor coparcener mainly supported from the income of such family; (d) Rs. 240 in the case of a married individual who has more than one child mainly dependent on him or a Hindu undivided family which has more than one minor coparcener mainly supported from the income of such family; (iii) where the total income is twenty thousand rupees or less, the income-tax payable shall not exceed forty per cent of the amount by which the total income exceeds the limit specified in sub-clause (a), or, as the case may be, sub-clause (b) of clause (i) of this proviso. Surcharge on incometax The amount of income-tax computed in accordance with the preceding provisions of this paragraph shall be increased by the aggregate of surcharges for purposes of the Union calculated as specified hereunder :- (a) where- (i) in the case of an individual or a Hindu undivided family, the amount of unearned income, not being income by way of interest on any security of the Central or Slate Government or income received in respect of units from the Unit Trust of India, established underthe Unit Trust of India Act, 1963-, included in the total income, or (ii) in any other case, the amount of

unearned income included in the total income; exceeds Rs. 15,000, a surcharge calculated on the difference between the amount of income-tax computed in respect of the income referred to in sub- claused), or, as the case may be, sub-clause (ii), if such income had been the total income and the amount of income-tax computed in respect of an income of Rs. 15,000 if it had been the total income, at the following rate, namely:- (1) where the amount of the difference does not exceed 20 per cent of the amount of such difference. Rs. 14,500. (2) where the amount of the difference exceeds Rs. 2,900 plus 25 per cent of the amount by which the Rs. 14,500. difference aforesaid exceeds Rs. 14,500; (b) where- (i) in the case of an individual or a Hindu undivided family, the earned income and income by way of interest on any security of the Central or State Government and income received in respect of units from the Unit Trust of India, established underthe Unit Trust of India Act, 1963-, included in the total income, or (ii) in any other case, the earned income included in the total income, exceeds Rs. 1 lakh, a surcharge calculated on the amount of difference between the income-tax computed in respect of the income referred to in sub-clause (i), or, as the case may be, sub-clause (ii), if such income had been the total income and the income-tax computed in respect of a total income of Rs. 1 lakh, at the following rate, namely:- (1) where the amount of the difference does not exceed 5 per cent of the amount of such difference. Rs. 65,000. (2) where the amount of the difference exceeds Rs. 3,250 plus 10 per cent of the amount by which the Rs. 65,000 but does not exceed Rs. 1,30,000. difference aforesaid exceeds Rs. 65,000; (3) where the amount of the difference exceeds Rs. 9,750 plus 15 per cent of the amount by which the Rs. 1,30,000. difference aforesaid exceeds Rs. 1,30,000; and (c) a special surcharge calculated at the rate of ten per cent on the aggregate of the following amounts, namely:- (i) the amount of incometax computed in accordance with the preceding provisions of this paragraph; and (ii) the aggregate of the amounts of the surcharges calculated in accordance with clause (a) and clause (b) of this sub-paragraph. Paragraph B In the case of every co-operative society,-

Rates of income-tax

(1) where the total income does not exceed Rs. 5,000. 5 per cent of the total income; (2) where the total income exceeds Rs.5,000 but does not Rs.250 plus 10 per cent of the amount by which the total exceed Rs. 10,000. income exceeds Rs. 5,000; (3) where the total income exceeds Rs. 10,000 but does Rs. 750 plus 15 per cent of the amount by which the total not exceed Rs. 15,000. income exceeds Rs. 10,000; (4) where the total income exceeds Rs. 15,000 but does Rs. 1,500 plus 20 per cent of the amount by which

the not exceed Rs. 20,000. total income exceeds Rs. 15,000; (5) where the total income exceeds Rs. 20,000 but does Rs. 2,500 plus 25 per cent of the amount by which the not exceed Rs. 25,000. total income exceeds Rs. 20,000; (6) where the total income exceeds Rs. 25,000. Rs. 3,750 plus 41 per cent of the amount by which the total income exceeds Rs. 25,000; Provided that- (i) no income-tax shall be payable on a total income not exceeding Rs. 4,000; and (ii) where the total income is twenty thousand rupees or less, the income-tax payable shall not exceed forty per cent of the amount by which the total income exceeds Rs. 4,000. Surcharges on income-tax The amount of income-tax computed at the rate hereinbefore specified shall be increased by the aggregate of surcharges for purposes of the Union calculated as specified hereunder:- (a) where the total income exceeds Rs. 25,000, a surcharge calculated at the rate of61/4 per cent of the amount of the difference between the income-tax computed at the rates hereinbefore specified and the income-tax computed in respect of a total income of Rs. 25,000; and (b) a special surcharge calculated at the rate of ten per cent on the aggregate of the following amounts, namely:- (i) the amount of income-tax computed at the rate hereinbefore specified; and (ii) the amount of the surcharge calculated in accordance with clause (a) of

this sub-paragraph. Paragraph C In the case of every registered, firm,-

Rates of income-tax

(1) where the total income does not exceed Rs. 25,000. Nil; (2) where the total income exceeds Rs. 25,000 but does 6 per cent of the amount by which the total income not exceed Rs. 50,000. income exceeds Rs. 25.000; (3) where the total income exceeds Rs. 50,000 but does Rs. 1,500 plus 8 per cent of the amount by which the total not exceed Rs. 1,00,000. income exceeds Rs. 50,000; (4) where the total income exceeds Rs. 1,00,000. Rs. 5,500 plus 12 per cent of the amount by which the total income exceeds Rs. 1,00,000;

Surcharges on income-tax The amount of income-tax computed at the rate hereinbefore specified shall be increased by the aggregate of surcharges for purposes of the Union calculated as specified hereunder:- (a) in the case of a registered firm whose total income includes income derived from a profession carried on by it and the income so included is not less than fifty-one per cent of such total income, a surcharge calculated at the rate of ten per cent of the amount of income-tax computed at the rate hereinbefore specified. (b) in the case of any other registered firm, a surcharge calculated at the rate of twenty per cent of the amount of income-tax computed at the rate hereinbefore specified; and (c) a

special surcharge calculated at the rate of ten per cent on the aggregate of the following amounts, namely :- (i) the amount of income-tax computed at the rate hereinbefore specified; (ii) the amount of the surcharge calculated in accordance with clause (a), or, as the case may be, clause (b) of this subparagraph, Paragraph D In the case of every local authority,- Rate of Income-tax Per cent On the whole of the total income ... ... ... ... ... ... 45 Surcharges on income-tax The amount of income-tax computed at the rate hereinbefore specified shall be increased by the aggregate of surcharges for purposes of the Union calculated as specified hereunder:- (a) a surcharge calculated at the rate of ten per cent of the amount of income-tax computed at the rate hereinbefore specified; and (b) a special surcharge calculated at the rate of ten per cent on the aggregate of the following amounts, namely:- (i) the amount of incometax computed at the rate hereinbefore specified, and (i) the amount of the surcharge calculated in accordance with clause (a) of this sub-paragraph. Paragraph E In the case of the Life insurance Corporation of India established underthe Life Insurance Corporation Act, 1956

Rates of income-tax

(i) on that part of its total income which consists of pro- 52.5 per cent; fits and gains from life insurance business. (ii) on the balance, if any of the total income, the rate of income-tax applicable in accordance with Paragraph F of this Part to the total income of a dome- stic company which is a company in which the public are substantially interested. Paragraph F In the case of a company, other than the Life Insurance Corporation of India established underLife Insurance Corporation Act, 1956-,-

Rates of income-tax

1. In the case of a domestic company- (A) (1) where the company is a company in which the public lire sub- stantially interested- (i) in a case where the total income does not exceed Rs. 25,000 45 per cent of the total income; (ii) in a case where the total income exceeds Rs. 25,000 55 per cent of the total income; (2) where the company is not a company in which the public are substantially interested,- . (i) in the case of an industrial company- . (1) on so much of the total income as does not exceed Rupees 55 per cent 10,00,000 (2) on the balance, if any, of the total income 60 per cent; (ii) in any other case. 65 per cent of the total income; am (B) in addition, where the company is- (i) a company in which the public are substantially interested, or (ii) a company as is referred to in clause.(iii) of sub-section (2) or clause (a) or clause (b) of sub-section (4) of section 104 of the Income-tax Act/or (iii) such a company as is exempt from the operation of section 104 of the said Act by a Notification issued under the provisions of sub-section (3) of that section, on so much of the total income as does not exceed the relevant amount of dis- 7.5 per cent tributions of dividends by the Company, Provided that the income-tax payable by a domestic company, being a company in which the public are substantially interested, the total of income of which exceeds Rs. 25,000, shall not exceed the aggregate of- (a) the income-tax which would have been payable by the company if its total income had been Rs. 25,000 (the income of Rs. 25,000 for this purpose being computed as if such income included income from various sources in the same proportion as the total income of the company); and (b) 80 per cent of the amount by which its total income exceeds Rs. 25,000. II. In the case of a company other than a domestic company,- . , (i) On so much of the total income as consists of- (a) royalties received from an Indian concern in pursuance of an agreement made by it with the Indian concern afier the 31st day of

March, 1961, or (b) fees for rendering technical services receiv- ed from an Indian concern in pursuance of an agreement made by it with the Indian concern after the 29th day of February, 1964. And where such agreement has, in either case, 50 per cent been approved by the Central Government (ii) On the balance, if any, of the total income 70 per cent,

PART 02: RATES FOR DEDUCTION OF TAX AT SOURCE IN CERTAIN CASES

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