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FAQ.1: Amendment of Section 9A of the Income-tax Act, 1961 Q.1. At present what are conditions for participation or investment in the corpus of eligible investment fund by persons resident in India, as per section 9A of the Incometax Act, 1961? Ans. At present, section 9A(3)(c) of the Income-tax Act, 1961 inter alia provides that the aggregate participation or investment by a person resident in India, in the eligible investment fund, directly or indirectly, shall not exceed five percent of the
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FAQ :
The supplementary FAQs have been released by the CBDT to provide further clarification on the amendments proposed in the Finance Bill 2025 to various sections of the Income-tax Act, 1961.
The proposed amendments to Section 9A aim to reduce compliance burden by stating that indirect participation or investment by a person resident in India will not be considered for the five percent condition in eligible investment funds. Additionally, the power of the Central Government to relax conditions for eligible investment funds located in an IFSC has been restored.
The proposed Section 44BBD introduces presumptive taxation for non-residents engaged in providing technology and services for electronics manufacturing facilities to resident companies. It deems twenty-five percent of the aggregate amount received or receivable as profits and gains.
The amendment to Section 10(10D) ensures that proceeds from life insurance policies issued by IFSC insurance offices are exempted without the condition related to the maximum premium payable.
The definition of 'resultant fund' in Section 47(viiad) has been expanded to include Retail Schemes and Exchange Traded Funds (ETFs) regulated under IFSCA. This allows the relocation of an original fund to these schemes to be treated as a tax-neutral transaction for unit holders, subject to conditions.
Chapter XIV-B has been amended to shift the focus from the assessment of 'total income' to the assessment of 'undisclosed income'. This means that the primary objective of a search or requisition is to identify income that has not been disclosed, while regular income will continue to be determined based on existing records.
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