News Update

Gurugram-based real estate developer raided; Income tax finds tax evasion on Rs 25 Cr long-term capital gainsPresident’s Rule imposed in Puducherry after 30 yearsGovt decides to regulate social media, streaming services through Rules under IT ActDelhi Customs sets ablaze 15.8 lakh smuggled foreign brand cigarettes worth Rs 2.4 CroreOECD urges tax jurisdictions to take action against tax fraud enabling professionalsPM launches development projects to 'improve' lives in Puducherry57 WTO members support India's IP waiver for COVID-19 vaccine: GoyalGST Tribunal - Sorely missed - But why did Budget say: See you later - ciao!UK Court green-signals extradition of Nirav Modi in PNB fraud caseGST - Suspension of GSTIN stayed - respondent directed to allow petitioner to conduct transactions: HCGST - Challenge to the Anti-Profiteering provisions and order of NAA - Stay ordered from recovery subject to petitioner paying the entire amount demanded in six EMIs: HCIndia, Pakistan agree on 'strict' observance of ceasefire along LoC from todayIndia records spike in COVID-19 cases with over 16,700 daily infectionsST - SVLDRS - Visibility of returns on GST portal - Technical infraction at the end of Respondent cannot be a ground to deprive Petitioner the benefit of the scheme: HCST - SVLDRS, 2019 - s.129(2)(b) of FA, 2019 - Whether the words 'same matter', 'different matter' are to be interpreted liberally or restrictively - Matter listed: HCGST - Any appeal can be made only against the original order which will be read together with the correction made in the rectification order - doctrine of merger does not apply: AAARGST - Order passed by AAR in the matter of a ROM application is not an appealable order u/s 100 of the CGST Act, 2017: AAARGST - Renting of e-bikes (Miracle)/bicycles (Move) without operator is classifiable under SAC 9973; attracts GST @5%, 12% respectively: AAARGST - Terms 'Betel nut' and 'Areca nut' are the same and used interchangeably - 'Nizam Pakku' attracts GST @5% and not @12%: AAARPM reviews projects worth Rs 44,545Cr in Pragati meetingIndia chairs first meeting of BRICS finance and central bank deputies 2021BRICS prepare for release of Joint Statistical Publication 2021
Untitled Document

GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
CENTRAL BOARD OF DIRECT TAXES
NEW DELHI

CIRCULAR NO

01/2021, Dated: January 15, 2020

Amount of remuneration prescribed under section 9A(3)(m) of the Income-tax Act, 1961

Finance (No 2) Act, 2019, inter alia, amended clause (m) of sub-section (3) of section 9A of the Income-tax Act, 1961 (the Act) w.e.f. 01.04.2019 to provide for payment of remuneration by an eligible investment fund to an eligible fund manager in respect of fund management activity undertaken by him on its behalf to be not less than the amount calculated in such manner as may be prescribed.

2. Accordingly, rule 10V of the Income-tax Rules, 1962 (the Rules) has been amended, w.e.f. 01.04.2019, vide Notification No 29/2020 dated 27.05.2020 by way of, inter alia, insertion of sub-rules (12) and (13) therein. Sub-rule (12) provides for the amount of remuneration to be paid by the fund to a fund manager, 2nd proviso of the said sub-rule provides that the fund may seek Board's approval in case where the amount of remuneration is lower than the amount so prescribed.

3. In this regard, representations have been received expressing inability to comply with the provisions of sub-rule 12 of rule 10V of the Rules regarding the amount of remuneration to be paid by the fund to a fund manager for the financial year 2019-20 as the said Notification No 29/2020 was notified after the financial year got over and the financial year 2020-21 had already commenced.

4. In order to avoid genuine hardship in such cases, the Board, in exercise of powers conferred under section 119 of the Act, has decided to provide that for the financial years 2019-20 and 2020-21 in cases where the remuneration paid to the fund manager is lower than the amount of remuneration prescribed under sub-rule (12) of rule 10V of the Rules, but is at arm's length, it shall be sufficient compliance to clause (m) of sub-section (3) of section 9A of the Act.

5. It is stated that the remuneration to be paid to the fund manager, for the financial year 2021-22, shall be in accordance with sub-rule (12) of rule 10V of the Rules and the application for lower remuneration in terms of 2nd proviso for this year, if any, may be filed not later than 1st February, 2021.

F.No. /370142/2/2021-TPL

(Vipul Agarwal)
Director (Tax Policy and Division)-I