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Representation
Representation
Mr. P. Chidambaram Date 24th March 2008
The Hon’ble Finance Minister
Government of India
North Block, Secretariat, New Delhi-110001.
Dear Sir,
Subject : Suggestions on the proposal in the
Finance Bill, 2008, relating to Direct Taxes
We have seen with interest the fifth consecutive budget
presented by your Honour on behalf of the United Progressive Alliance (UPA)
Government in the Parliament on 29th February 2008 and appreciate your concern
for challenges faced by the country and your efforts to accelerate economic
growth of agriculture sector, industry, infrastructure and exports.
There are certain provisions in the Finance Bill relating
to Income Tax and Wealth Tax, which may need your kind attention, since they
need to be modified or deleted. Some of the present proposals may be prone to
be inequitable and/or may only increase litigation, without real addition to
the net revenue to the Government.
Our suggestions on various topics for rationalisation of
law, rectification of certain anomalies and correction of drafting errors, are
given in the enclosed representation relating to Direct taxes.
We hope that our representation will receive due
consideration. Should a need to explain the recommendation be felt, please let
us know and we shall be more than happy to explain them to you personally.
Thanking you,
We remain,
Yours truly,
For Bombay Chartered Accountants’ Society
Rajesh Kothari Pinakin Desai Rajesh Shah
President Chairman Co-Chairman
Taxation Committee
Mr. P. Chidambaram Date 24th March 2008
The Hon’ble Finance Minister
Government of India
North Block, Secretariat, New Delhi-110001.
Dear Sir,
Subject : Suggestions on the proposal in the
Finance Bill, 2008, relating to Indirect Taxes
We have seen with interest the fifth consecutive budget
presented by your Honour on behalf of the United Progressive Alliance (UPA)
Government in the Parliament on 29th February, 2008 and appreciate your
concern for challenges faced by the country and your efforts to accelerate
economic growth of agriculture sector, industry, infrastructure and exports.
There are certain provisions in the Finance Bill relating
to Indirect Taxes, which may need your kind attention since they need to be
modified or deleted. Some of the present proposals may be prone to be
inequitable and/or may only increase litigation, without real addition to the
net revenue to the Government.
Our suggestions on various topics for rationalisation of
law, rectification of certain anomalies and correction of drafting errors, are
given in the enclosed representation relating to Indirect Taxes.
We hope that our representation will receive due
consideration.
Thanking you,
We remain,
Yours truly,
For Bombay Chartered Accountants’ Society
Rajesh Kothari Pranay Marfatia Govind Goyal
President Chairman Co-Chairman
Indirect Taxes and Allied Laws Committee
Representation
Direct Tax Executive summary
1. Rates of tax :
l
It is suggested that there should be back-up provision for marginal relief to
individuals having income up to Rs.3 lakh including short-term capital gain, who
may end up paying tax @15% on short-term capital gain.
l
It is also suggested that STT which has been paid at the time of purchase of
security should be considered to be the cost of security in computing the
chargeable capital gain.
2. Charitable Trust — S. 2(15) :
l
It is suggested that the amendment should make it clear that the proposed
amendment covers an activity in the nature of trade, commerce or business, which
is ‘for profit’, such that the mere circumstance of receipt of membership fee or
cost recoupment without any profit-making design is not interpreted as an
objectionable activity. The reflection of the words ‘for profit’ as part of the
definition will not only bring out the legislative intent more clearly, but will
also make the definition sound akin to the definition as we had till the year
1992, so that the ratio of judgment of the Supreme Court in the case of Surat
Art Silk is available to the tax-paying community as guideline.
l
It should be clarified that the income of public religious trust is not covered
by the amendment.
