is the rebate of rupees 2000,where income of resident individual does not exceed rupees 500000, as per sec 87A, applicable for A.Y 2013-14?i.e.is it applicable for CA final may13?
is the rebate of rupees 2000,where income of resident individual does not exceed rupees 500000, as per sec 87A, applicable for A.Y 2013-14?i.e.is it applicable for CA final may13?
Every amentment made in Budget 2013 is applicable from May-2014 exams. For May-13 amendments made in Budget 2012 are applicable and notifications and circulars issued upto 31's october i.e 6 months before the exams.
It is similar to Transfer Pricing wherin transactions between a party and a specified domestic party would be decided on the basis of Arms; Length Price. Transactions should be above Rs 5 Cr.
This provision also covers transactions with entities covered under tax holiday. The reasoning behind this amendment is like this For Ex there is a company which is registered under tax holiday...it sells certain goods from xyz company (which is taxable) for Rs 80,000 ( market price of which is Rs 50,000 fro example) by doing this what happens is the profit of th company under tax holiday is inflated by Rs 30,000 but it does not affect that company as it is not supposed to pay tax....but the profits of xyz company would be deflated by rs 30,000 and hence a saving of tax of Rs 9000 for xyz. To stop this practise this provision is introduced by which the transaction would be recorded at rs 50,000 and xyz would be granted a deduction of only Rs 50,000.
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