Finance Acts

Amendment of section 57 In section 57 of the Income-tax Act,— (a)   in clause (i), after the words “in the case of dividends,”, the words, brackets, letter and figures “other than that referred in sub-clause (f) of clause (22) of section 2″ shall be inserted with effect from the 1st day of October, 2024; (b)   in clause (iia), before the Explanation, the following proviso shall be inserted with effect from the 1st day of April, 2025, namely:—     ‘Provided that in a case where income-tax is computed under clause (ii) of sub-section (1A) of section 115BAC, the provisions of this clause shall have effect as if for the words “fifteen thousand rupees”, the words “twenty-five thousand rupees” had been substituted;’. (c)   after the proviso, the following proviso shall be inserted with effect from the 1st day of October, 2024, namely:—     “Provided further that no deduction shall be allowed in case of dividend income of the nature referred to in sub-clause (f) of clause (22) of section 2.”.

Amendment of section 56 In section 56 of the Income-tax Act, in sub-section (2), in clause (viib), after the second proviso, the following proviso shall be inserted with effect from the 1st day of April, 2025, namely:— “Provided also that the provisions of this clause shall not apply on or after the 1st day of April, 2025.”.

Amendment of section 55 In section 55 of the Income-tax Act, in sub-section (2), in clause (ac), in the Explanation, in clause (a), in sub-clause (iii), after item (A), the following item shall be inserted and shall be deemed to have been inserted with effect from the 1st day of April, 2018, namely:— “(AA) not listed on a recognised stock exchange as on the 31st day of January, 2018, or which became the property of the assessee in consideration of share which is not listed on such exchange as on the 31st day of January, 2018 by way of transaction not regarded as transfer under section 47, as the case may be, but listed on such exchange subsequent to the date of transfer (where such transfer is in respect of sale of unlisted equity shares under an offer for sale to the public included in an initial public offer);”.

Amendment of section 50AA In section 50AA of the Income-tax Act,— (a)   for the portion beginning with the words “Notwithstanding anything contained in” and ending with the words “short-term capital asset:”, the following shall be substituted and shall be deemed to have been substituted with effect from the 23rd day of July, 2024, namely:—     “Notwithstanding anything contained in clause (42A) of section 2 or section 48, where the capital asset— (a)   is a unit of a Specified Mutual Fund acquired on or after the 1st day of April, 2023 or a Market Linked Debenture; or (b)   is an unlisted bond or an unlisted debenture which is transferred or redeemed or matures on or after the 23rd day of July, 2024,     the full value of consideration received or accruing as a result of the transfer or redemption or maturity of such debenture or unit or bond as reduced by— (i)   the cost of acquisition of the debenture or unit or bond; and (ii)   the expenditure incurred wholly and exclusively in connection with such transfer or redemption or maturity,     shall be deemed to be the capital gains arising from the transfer of a short-term capital asset:”; (b)   in the Explanation, for clause (ii), the following clause shall be substituted with effect from the 1st day of April, 2026, namely:—     ‘(ii) “Specified Mutual Fund” means,— (a)   a Mutual Fund by whatever name called, which invests more than sixty-five per cent of its total proceeds in debt and money market instruments; or (b)   a fund which invests sixty-five per cent or more of its total proceeds in units of a fund referred to in sub-clause (a): Provided that the percentage of investment in debt and money market instruments or in units of a fund, as the case may be, in respect of the Specified Mutual Fund, shall be computed with reference to the annual average of the daily closing figures: Provided further that for the purposes of this clause, “debt and money market instruments” shall include any securities, by whatever name called, classified or regulated as debt and money market instruments by the Securities and Exchange Board of India.’.

Amendment of section 48 In section 48 of the Income-tax Act, in the second proviso, after the words “where long-term capital gain arises from the transfer”, the brackets, words, figures and letters “(which takes place before the 23rd day of July, 2024)” shall be inserted and shall be deemed to have been inserted with effect from the 23rd day of July, 2024.

Amendment of section 47 In section 47 of the Income-tax Act, for clause (iii), the following clause shall be substituted with effect from the 1st day of April, 2025, namely:— “(iii) any transfer of a capital asset by an individual or a Hindu undivided family, under a gift or will or an irrevocable trust;”.

Amendment of section 46A  In section 46A of the Income-tax Act, the following proviso shall be inserted before the Explanation, with effect from the 1st day of October, 2024, namely:— “Provided that where the shareholder receives any consideration of the nature referred to in sub-clause (f) of clause (22) of section 2 from any company, in respect of any buy-back of shares, that takes place on or after the 1st day of October, 2024, then for the purposes of this section, the value of consideration received by the shareholder shall be deemed to be nil.”.

Insertion of new section 44BBC After section 44BBB of the Income-tax Act, the following section shall be inserted with effect from the 1st day of April, 2025, namely:— ’44BBC. Special provision for computing profits and gains of business of operation of cruise ships in case of non-residents – (1) Notwithstanding anything to the contrary contained in sections 28 to 43A, in the case of an assessee, being a non-resident, engaged in the business of operation of cruise ships subject to such conditions as may be prescribed, a sum equal to twenty per cent of the aggregate of the amounts specified in sub-section (2) shall be deemed to be the profits and gains of such business chargeable to tax under the head “Profits and gains of business or profession”. (2) The amounts referred to in sub-section (1) shall be the following, namely:— (a)   the amount paid or payable to the assessee or to any person on his behalf on account of the carriage of passengers; and (b)   the amount received or deemed to be received by or on behalf of the assessee on account of the carriage of passengers.’.

Amendment of section 44B In section 44B of the Income-tax Act, with effect from the 1st day of April, 2025,— (a)   for the marginal heading, the following marginal heading shall be substituted, namely:—     “Special provision for computing profits and gains of shipping business other than cruise shipping in case of non-residents.”; (b)   in sub-section (1), after the words “business of operation of ships,”, the words, figures and letters “other than cruise ships referred to in section 44BBC,” shall be inserted.

Amendment of section 43D In section 43D of the Income-tax Act, with effect from the 1st day of April, 2025,— (i)   in the marginal heading, the words “public companies,” shall be omitted; (ii)   clause (b) shall be omitted; (iii)   in the long line, the words “or the public company” shall be omitted; (iv)   in the Explanation, clauses (a) and (b) shall be omitted.