From Finance Bill to Finance Act, 2023

(Emerging Trends in Passing the Finance Bills)

The Finance Bill 2023 proposed 120 amendments to the Income-tax Act, 1961. However, the Finance Act, 2023 was eventually passed with 64 amendments to the Finance Bill. The Finance Bill was passed amidst uproar in Parliament without any discussion at all.

These days there is hardly any debate (for various reasons) in Parliament while passing the Finance Bill, with the result that not only amendments proposed by the Finance Bill get passed, but also additional amendments moved by the Government, which are not part of the original Finance Bill, also get passed easily.

It is suggested that provisions of a Finance Bill having significant impacts should be discussed and debated in Parliament or a select committee thereof and/or with various stakeholders, as it is always a good practice to have a consultative process before making significant amendments that have far-reaching impacts. This would prevent piecemeal amendments to the Income-tax Act, which are often carried out to reverse the judgments favouring assesses, or amendments to curb exceptional misuse of provisions by a few.

Recent amendments to the taxation of Charitable Trusts are a classic example of how amendments w