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The Finance Act, 1980

( ACT NO. XXIII Of 1980 )

Amendment of Act XI of 1922
4. The following amendments shall be made in the Income tax Act, 1922 (XI of 1922), namely:
 
 
 
 
(1) in section 2, in clause (6C), for the semi colon at the end a comma shall be substituted and thereafter the following shall be added, namely:-
 
 
 
 
“receipts in the nature of compensation or damages for cancellation or termination of contracts and licences by the Government or any person, cancellation of indebtedness which makes any debtor taxable, goodwill money, salami or premia receivable on account of all leases or transfer of any business;”;
 
 
 
 
(2) in section 4, in sub section (3),-
 
 
 
 
(a) in clause (via), the words and comma “not being winning from lotteries,” shall be omitted;
 
 
 
 
(b) In clause (xii),-
 
 
 
 
(i) after sub-clause (f), a new sub-clause (ff) shall be inserted, namely:-
 
 
 
 
“(ff) in respect of a building the erection of which is begun and completed at any time between the first day of July, 1980 and the thirtieth day of June, 1985 (both days inclusive) and the building is intended to be, and is actually, used for residential purposes only, for a period of five years from the date of such completion, subject to the following limits, namely:-
 
 
(i) in a case where annual value off such building does not exceed twelve thousand Taka The whole of such value;
 
 
 
 
(ii) in a case where annual value of such building exceeds twelve thousand Taka Twelve thousand Taka:
 
 
 
 
Provided that where an assessee claims exemption in respect of more than one such building the exemption under this sub clause shall be restricted to such portion of the aggregate annual value of such building as does not exceed twelve thousand Taka;
 
 
 
 
(ii) in sub clause (g), for the full stop at the end a semi-colon shall be substituted and thereafter the following new sub clause (h) shall be added, namely:
 
 
 
 
“(h) in respect of a building the erection of which is begun and completed at any time between the first day of July, 1980 and the thirtieth day of June, 1985 (both day inclusive) and which is intended to be, and is actually, used for residential purposes only, for a period of five years from the date of such completion, subject to the condition that the plinth area of the building is not more than one thousand square feet. The exemption under this sub clause shall also apply in the case of housing companies, societies and estates where the construction comprises bungalows, flats, apartments or units (hereinafter referred to as units) each containing plinth area of not more than one thousand square feet provided the construction comprises not less than twenty five units.”;
 
 
 
 
(c) in clause (xiib), in the proviso, for the words “five thousand taka” the words “ten thousand taka” shall be substituted;
 
 
 
 
(3) in section 5A, in sub section (3), in the Explanation, in clause (b), after the words “service as”, the words “Appellate or Inspecting” shall be inserted;
 
 
 
 
(4) In section 7, in sub-section (1), in the third proviso, for the words “two thousand and four hundred taka”, “one thousand and two hundred taka” and “nine hundred taka” the words “three thousand and six hundred Taka”, “one thousand and eight hundred Taka” and “one thousand and five hundred Taka” shall respectively, be substituted;
 
 
 
 
(5) in section 9, in sub-section (1), in clause (iv) after the words “mortgage or other capital charge”, the words “for purposes of extension or reconstruction or improvement” shall be inserted;
 
 
 
 
(6) in section 9A, in sub-section (2) in clause (v), after the words “mortgage or other capital charge”, the words “for purposes of reclamation or improvement” shall be inserted;
 
 
 
 
(7) in section 10, in sub-section (4), for clause (e) the following shall be substituted, namely:-
 
 
 
 
“(e) any allowance in respect of expenditure on entertainment in excess of the amounts specified below:-

(i)     on the first Taka 5 lakhs of income, profits and gains of the business, profession or vacation

4% or Taka 20,000, which ever is higher.

 

 

(ii)    on the next Taka 15 lakhs

2%

 

 

(iii)   on the next Taka 30 lakhs

1%

 

 

(iv)   on the balance

½ % or

 

(ee)   any allowance in respect of such expenditure on foreign travels for holidaying and recreation of employees and their dependents as may be prescribed; or”;

 

(8) after section 12AA, the following section 12AAA shall be inserted, namely:-

 

12AAA, Salami or premia receipt.- Where any lump-sum amount is received or received by an assessee during any pervious year represents income on account of salami or premia receipts, such income shall, if he so, claims, be allocated for the purpose of assessment proportionately to the years covered by the entire lease period, but such allocation shall in no case exceed five years.”;

 

                (9) in section 12B,-

 

(a)    in sub-section (2), after the second proviso, the following new proviso shall be inserted, namely:-

 

“Provided further that if in the opinion of the Deputy Commissioner of Taxes the fair market value of a capital asset transferred by an assessee as on the date of the transfer exceeds the declared value therefore by more than 25% of such declared value, the Government may offer to buy the said asset in such manner as the National Board of Revenue may prescribe:”;

 

(b)    in sub‑section (5),

 

(i)     the words “by the assessee or a parent of his mainly”, the words “his own or the parents’ own” and the words “his own” shall be omitted;

 

(ii)    in clause (b), in sub‑clause (ii), in the proviso, the words “assessee’s own” shall be omitted;

 

(c)     after sub‑section (5) amended as aforesaid, the following new sub-section (6) shall be added,namely:-

 

“(6) Notwithstanding anything contained in sub‑section (1) where a capital gain arises from the sale, exchange or transfer of a capital asset being government securities and stocks and shares of public companies which fulfill the conditions laid down  in  sub‑section  (3)  of  section  15C,  then no tax shall be charged under this section if the sale proceeds are reinvested within a period of two years in the acquisition of similar securities, stocks and shares.”;

 

(10)    section 13 shall be numbered as sub‑section (1) of that section, and after sub‑section (1) as so renumbered the following new sub‑section (2) shall be added namely:-

 

“(2) Notwithstanding anything contained in the second proviso to sub-section (1) every person engaged in the manufacturing and wholesale business shall maintain such books of accounts and other documents (including inventories where necessary) and shall maintain such record of payments of commercial nature and other commercial transactions as the National Board of Revenue may prescribe in this behalf.”;

 

(11)    in section 14, in sub‑section (3), in clause (b), in sub-clause (ii), the word “or” at the end shall be omittedand thereafter the following explanation shall be added, namely:-

 

Explanation.‑In thissub‑clause, “cottage industry” means an enterprise, not being owned by a joint stock company, which fulfils the following conditions, namely:-

 

(a)   it is basically an enterprise in which the owner is the investor, a full‑time worker and the actual entrepreneur;

 

(b)   the capital invested in it does not exceed Taka ten thousand at any time during the previous year;

 

(c)   the number of workers, including the owner and the members of his family, that is, his parents, wife or wives, sons and daughters, dependent on him and employed in the factory, whether working full‑time or part‑time, whether for or without any wages, remunerations or compensation in cash or otherwise, shall not on any one twenty‑four hour day during the previous year exceed six; and

 

(d)   the owner of the factory or any member of his family as specified in (c) above does not own any other industrial or commercial enterprise either in his own name or in the name of any other person; or”,,

 

(a)   in sub‑section (2A), for the figure “1980” the figure “1985” shall be substituted;

 

(b)   in sub‑section (2B), in clause (a), the proviso shall be omitted;

 

(c)   in sub‑section (2C), for the figure “1980” the figure “1985” shall be substituted;

 

(13)   in section 15, in sub‑section (1), after the word “husband” occurring for the first time, the words “or a minor child” shall be inserted;

 

(14)   in section 15A, for the words “four thousand taka” the words “five thousand Taka” shall be substituted and the first proviso shall be omitted;

 

(15)   in section 15E,­-

 

(a)   for the words “eight hundred Taka” wherever occurring the words “one thousand Taka” shall be substituted;

 

(b)   for the words “two thousand four hundred taka” wherever occurring the words “two thousand Taka” shall be substituted;

 

(c)   the words and commas “or, in the case of two children, exceeds one thousand six hundred taka” shall be omitted;

 

(16)    in section 15H, for the words “two thousand Taka” the words “three thousand Taka” shall be substituted; and the proviso shall be omitted;

 

(17)    in section 16, in sub‑section (3), in clause (a), in sub‑clause (i), for the semi‑colon at the end a colon shall be substituted and thereafter the following proviso shall be added,namely:-

 

“Provided that nothing in this sub‑clause shall apply to the membership of the spouse in a firm in which he or she contributes personal, technical or personal professional knowledge and experience;”;

 

(a)   in sub-section (1)-

 

(i)    in clause (a), for the words “greater plus” a colon shall be substituted;

 

(ii)   clause (b) shall be omitted;

 

(b)   in sub-section (5)-

 

(i)    in clause (ii) for the words “twelve months” the words “two years” shall be substituted;

 

(ii)   in clause (b),

 

(A) for the words “twelve months” the words “two years” shall be substituted;

 

                (B) for sub-clause (i) the following shall be substituted, namely:-

 

                        “(ii)    in the case of other assesses-

 

(1)  Where the capital gansarise as a result of disposal by the assessee of his capital assets after two years but before five years from the date of their acquisition.

 

Income-tax payable on the capital gains at the rate applicable to his total income including the said capital gains, or, income-tax at the rate of 35% on the amount of the capital gains, whichever is the lower.

 

(2) Where the capital gains arise as a result of disposal by the assessee of his capital assets after five years from the date of their acquisition

 

Income-tax payable on the capital gains at the rate applicable to his total income including the said capital gains, or, income-tax  at the rate of 30% on the amount of the capital gains, whichever is the lower.”;

 

 

(19) in section 20A, for the words “five hundred taka” the words “three thousand Taka” shall be substituted;

 

(20) after section 21A, the following new section 21AA shall be inserted, namely:-

 

21AA. Licence.- (1) Every person carrying on any business, profession or vocation in such areas as the National Board of Revenue may, by notification in the official Gazette, specify and who pays rent for or owns the premises where he carries on the business profession, or vocation, shall take out an annual licence on payment of a fee of Taka one hundred initially and Taka fifty for renewal, in such form and manner as the National Board of Revenue may prescribe.

 

(2)   If any person fails to obtain a licence, as required by sub‑section (1), the Deputy Commissioner of Taxes may, after giving such person a reasonable opportunity of being heard, direct that such person shall pay by way of penalty a sum not exceeding Taka five hundred.”;

 

                (21) in section 22,­

 

(a)   in sub‑section (1), in the proviso, for the full stop at the end a colon shall be substituted andthereafter the following new proviso shall be added, namely:-

 

“Provided that every individual whose total income during the previous year exceeded Taka twenty thousand shall furnish along with the return or certificate, as the case may be a statement in the prescribed form and verified in the prescribed manner giving particulars of the total assets and liabilities of himself, his wife or wives and his minor children.”

 

(b)   in sub‑section (4A), after the word “assessee”, the words, brackets and the figure “other than an assessee referred to in the second proviso to sub‑section (1)” shall be inserted;

 

(22) in section 23, after sub‑section (3), the following new sub‑section (3A) shall be inserted,namely:-

 

“(3A) In the case of an assessee carrying on any business, profession or vocation who has filed a return voluntarily under sub‑section (1) of section 22 or in response to a notice under sub‑section (2) of section 22 or section 34 or in a case where no such return has been filed, the Deputy Commissioner of Taxes shall presume his total income during the previous year to be Taka fifteen thousand and shall send a notice accordingly to the assessee to establish with accounts, documents and evidence that the presumptive income is not correct. If the assessee fails to do so, the Deputy Commissioner of Taxes shall make an assessment on the aforesaid presumptive income and the income, so determined once shall remain unchanged for the next two years”;

 

(a)   for sub‑section (1) the following shall be substituted, namely:-

 

        “(1) If any person has without reasonable cause failed to-

 

(a)   furnish the return or certificate or statement which he is required to furnish under sub‑section (9) of section 18, section 19A, section 20, section 20A, section 21, section 22, section 34, orsection 38 or has, without reasonable cause, failed to do so within the time or extended time, if any, allowed under the relevant section, the Deputy Commissioner of Taxes shall, after giving the person a reasonable opportunity of being heard, direct him to pay by way of penalty a sum not exceeding one thousand Taka and in the case of a continuing default, a further sum not exceeding fifty Taka for every day during which the default continues;

 

(b)   comply with a notice under sub‑section (4) or section 22 or subsection (2) or sub‑section (3) of section 23, the Deputy Commissioner of Taxes may direct that such person shall pay by way of penalty, in addition to any tax payable by him, a sum not exceeding an amount equal to the amount of income‑tax which would have been avoided if the income as returned by such person had been accepted as the correct income.”;

 

(c)   in sub‑section (6), after the word “section”, the commas, words, brackets, letter and figure “, except in the cases referred to in clause (a) of sub‑section (1),” shall be inserted;

 

(24)    in section 30, in sub‑section (1), in the first proviso, for the words and figure “tax payable under section 22A has been paid” the words “undisputed portion of the tax has been paid” shall be substituted;

 

(25)    In section 31,-

 

(a)   in sub‑section (4),­-

 

(i)    In clause (a), sub‑clause (ii) shall be omitted;

 

(ii)   in clause (b), the words and comma “or set aside such order and direct the Deputy Commissioner of Taxes to make such further inquiry as he thinks fit or as the Appellate Joint Commissioner may direct and the Deputy Commissioner of Taxes shall thereupon proceed to make such inquiry and shall thereafter make a fresh order registering the firm or refusing to register it or canceling its registration, as he may think fit” shall be omitted;

 

(ii)   In clause (c), the words and comma “or set aside such order and direct the Deputy Commissioner of Taxes to make fresh order after making such inquiry as the Deputy Commissioner of Taxes thinks fit or as the Appellate Joint Commissioner of Taxes may direct, and the Deputy Commissioner of Taxes shall there upon proceed to make such fresh order and determine the amount of penalty on the basis of such order” shall be omitted;

 

(b)   after sub‑section (6), the following new sub‑section (7) shall be added, namely:-

 

“(7) Notwithstanding anything contained in this Act, the Appellate Joint Commissioner shall not make an order-

 

(a)   in respect of an appeal pending before him on the 30th June, 1980‑after the expiry of a period of two years from thatdate, and

 

(b)   in respect of an appeal filed before him on or after the 1st day of July, 1980‑after the expiry of one year from the end of the year in which the appeal was filed:

 

Provided that if the Appellate Joint Commissioner has failed to make an order within the period specified in this section, the appeal shall be deemed to have been allowed by the Appellate Joint Commissioner.”;

 

 

(a)   in sub‑section (1), in the first proviso, for the words “half the amount representing the difference between the tax as determined on the basis of the order of the Appellate Joint Commissioner and the tax payable under

 

        section 22A” the words “the undisputed portion of the tax as determined on the basis of the order of the Appellate Joint Commissioner” shall be substituted;

 

(b)   in sub‑section (4), clause (e) shall be omitted;

 

 

(i)    in clause (a), for the words and figure “tax payable under section 22A has been paid” the words “undisputed portion of the tax has been paid” shall be substituted;

 

(ii)   in clause (b), for the words, figure and comma “half the amount representing the difference between the tax as determined on the basis of the order of the Appellate Joint Commissioner and the tax payable under section 22A,” the words “the undisputed portion of the tax as determined on the basis of the order of the Appellate Joint Commissioner” shall be substituted;

 

(b)   after sub‑section (4), the following new sub‑section (5) shall be added namely:-

                       

“(5) Notwithstanding anything contained in this Act, the Commissioner shall not make an order-

 

(a)    in respect of an application for revision pending before him on the 30th June, 1980‑after the expiry of a period of two years from that date; and

 

(b)    in respect of an application for revision field before him on or after the 1st day of July, 1980‑after the expiry of one year from the end of the year in which the application for revision was filed:

 

Provided that if the Commissioner has failed to make an order within the period specified in this section, the application for revision shall be deemed to have been allowed by the Commissioner.”;

 

 

(a)   in sub‑section (1A), in clause (c), in the proviso, for the full stop at the end a colon shall be substitutedand thereafter the following new proviso shall be added,namely:-

 

“Provided further that as respects any assessment year beginning on the first day of July, 1981, the provision of this clause shall have effect as if for the word “four” the word “two” were substituted.”;

 

(b)   in sub‑section (2), in the proviso,‑

 

(i)    in clause (i), after sub‑clause (f)the following new sub‑clause (g) shall be added,namely:-

 

“(g) in relation to the income, profits or gains which are first assessable in any year beginning with the year 1981‑82, the words “two years” were substituted.”;

 

(ii)   in clause (iv), in sub‑clause (b), for the word “four” the word “two” shall be substituted;

 

(29)   in section 38, in clause (3), for the words “four hundred taka” the words “three thousand Taka” shall be substituted;

 

(30) after section 45, the following new section 45A shall be inserted,namely:-

 

“45A. Simple interest on delayed payment.- If the amount specified as payable in a notice of demand under section 29 or an order under section 31 or section 33 is not paid within the time specified under section 45, the assessee shall be liable to pay simple interest at fifteen per cent. per annum. from the date following the date or extended date specified for payment to the date of actual payment.”;

 

(31) in section 48, after sub‑section (4), the following new sub-section (5) shall be added, namely:-

 

“(5) Where a refund due to an assessee is not paid within two months of the date of the relevant assessment order or claim of refund, interest at the rate of twelve per cent. per annum shall be payable to the assessee on the amount of refund from the month following the aforesaid two months to the date of issue of the refund.”;

 

(32) in section 54, in sub‑section (3), in clause (cc), after thewords “by the”, the words “National Board of Revenue or any officer authorised by it in this behalf and the” shall be inserted;

 

(33) CHAPTER IX shall be omitted;

 

(34)   in section 61, after sub‑section (1), the following explanation shall be inserted, namely:

 

Explanation.‑Inthis sub‑section, the word “relative” shall mean the parent, spouse, son, daughter, brother and sister of the assessee.”.


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