Amendment To Income Tax Act By Finance Bill 2073 English Version

Section 5. Taxable income and classification of income headings:

Amended Provision

The taxable income of any person in any income year shall be equal to the amount computed by subtracting the amount, if any, claimed pursuant to

Section 12, 12ka, 12kha or 63 or all 4 section from the grand total amount of assessable income of each of the following income headings in that income year:

(a) Business,

(b) Employment, and 

(c)  Investment.

Effect of Amendment

Taxable amount is computed after subtracting the amount as per section 12kha. While previously only section 12, 12ka and 63 is allowed for deduction.

Section 11 (3chha)

Amended Provision

Company listed in Security Exchange board engaged in Manufacturing, Tourism Service, Hydro Production distribution and transmission  and industry as mentioned in section 11GA is allowed for 15% Tax rebate.

Effect of Amendment

Tax rebate is increased to 15% which is previously 10%.

Section 11 Explation GA

Amended Provision

"Special industry" means a production-oriented, agricultural, forestry and minerals  industry as classified in Section 3 of the industrial Enterprises Act, 2049 (1992) except an industry producing cigarette, Bidi, Sigar, tobacco, Khaini, Gutka, Panmasala, other productions of the same nature involving tobacco as the principal raw materials, liquors, beer and products of similar kind.


Effect of Amendment

Industry related with gutka and panmasala are not treated as special industry and agricultural, forestry and minerals industry are treated as special industry.

Section 11Kha

Amended Provision

No income source will be asked for investment made within 2075 Chaitra end in projects of national importance like hydro-electricity project, projects of infrastructure such as international airport, tunnel and road, railway and manufacturing industry (except cigarette, Bidi, Cigar, Tobacco, Khaini, Gutka, Panmasala, wine and beer industry) employing more than 300 local workers and using more than 50% local raw materials.

Effect of Amendment

Income source for investment in manufacturing industry for Bidi, Cigar, Tobacco, Khaini, Gutka, Panmasala might be asked.

Section 47Ka(6)

Amended Provision

Entity wiling to get merged pursuant to Sub-Section(1) should submit expression of interest to IRD within Ashadh 2072.

Effect of Amendment

Time for submission of expression for merger extended to 2075 Ashadh from 2073 Ashadh

Section 47Ka(7)

Amended Provision

The entities submitting expression of interest to get merged under Sub-Section(1) should complete the merger process 2076 Ashadh end.

Effect of Amendment

Time for merger extended to 2076 Ashadh from 2074 Ashadh

Section 88(1) (6)

Amended Provision

Tax Deduction at the rate of 10 % to be made while making the payment for the use of Satellite, bandwidth, Optical Fiber, Telecom related equipment or electric transmission line.

Effect of Amendment

Clause(6) inserted after (5) in provided clause of Section 88(1)

Section 92(1)(Ka)

Amended Provison

Dividend paid by resident company and partnership firm is final withholding

Effect of Amendment

TDS on dividend paid by the partnership firm is final withholding.

Section 95Ka(2)(Kha)


Section 95Ka (3)

Amended Provision

Company Registration Office shall register the share only after submission of the proof of the deposit of advance tax for the gain on disposal of interest under Clause(Kha).

Section 95Ka (4)

Amended Provision

Not-withstanding anything contained in this section no tds shall deducted in the gain in disposal of interest through Mutual Fund.

Effect of Amendment

No TDS on Gain on disposal of interest through Mutual Fund

Section 95Ka (6)

Amended Provision

Land Revenue Office shall recover advance income tac at the rate of 10% on gain on disposal of land or building through the person other than as mentioned in Sub-Section (5).

Section 115(6)

Amended Provsion

Person submitting the application pursuant to Sub-Section (1) for administrative review shall deposit whole amount of the undisputed tax and the 1/3 rd of the disputed tax amount.

Effect of the amendment

Whole amount of undisputed tax and 1/3rd amount of the disputed amount shall be deposited while submitting the application for administrative review.

Section 119Ka

Amended Provision

Charge equivalent to the penalty amount of Rs 5,000 to 25,000 will be levied to a person not following the provisions of this act and the rules there under except for those provisions specifically mentioned in the Act.

Effect of Amendment

Fine of Rs 5,000 to 25,000 will be levied in violation of acts and rules there under

Section 127

Amended provision

Any person who knowingly aids or abets to commit and offence under this Act or counsels or induces another person to commit such offence or certifies false financial or income statements or provide false consultancy shall be liable to a half of the penalty that is imposed on the main offender.

Effect of Amendment

Auditors and Consultant are also treated as offender.

Schedule 1 (1)

Amended Provision

Natural persons income is taxable at the rate of 1 % upto income of Rs 3,50,000 and 4,00,000 in case of income of Couple.

Effect of Amendment

Tax Exemption limit is increased to Rs : 3,50,000 in case of single and 4,00,000 incase of couples.

Schedule 1 (1) 17

Amended Provision

KA) Person Dealing in cigarette, gas for which the person make sales by adding commission of upto 3% shall be taxable at the rate of 0.25% (previously 0.5%) on transaction amount.

KHA) Person dealing in goods besides the goods specified in clause KA shall be taxable at the rate of 0.75% (previously 1.5%)  of transaction amount.

Effect of amendment

Tax rate decreased for the person paying tax on the basis of turnover.


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