A new tax called
Commodities Transaction Tax (CTT) is proposed to be levied on taxable
commodities transactions entered into in a recognised association.
It is proposed to define ‘taxable commodities
transaction’ to mean a transaction of sale of commodity derivatives in respect
of commodities, other than agricultural commodities, traded in recognised
associations.
The tax is proposed to be levied at the rate,
given in the Table below, on taxable commodities transactions undertaken by the
seller.
The provisions with regard to collection and
recovery of CTT, furnishing of returns, assessment procedure, power of
assessing officer, chargeability of interest, levy of penalty, institution of
prosecution, filing of appeal, power to the Central Government, etc. have also
been provided.
This tax is proposed to be levied from the date
on which Chapter VII of the Finance Bill, 2013 comes into force by way of
notification in the Official Gazette by the Central Government.
Further, it is proposed to amend section 36 of
the Income-tax Act to provide that an amount equal to the commodities
transaction tax paid by the assessee in respect of the taxable commodities
transactions entered into in the course of his business during the previous
year shall be allowable as deduction, if the income arising from such taxable
commodities transactions is included in the income computed under the head
“Profits and gains of business or profession”.
It is also proposed to insert an Explanation to
provide that for the purposes of this clause, the expressions “commodities
transaction tax” and “taxable commodities transaction” shall have the meanings
respectively assigned to them under Chapter VII of the Finance Act, 2013.
This amendment in section 36 of the Income-tax
Act will take effect from 1st April, 2014 and will, accordingly, apply in
relation to the assessment year 2014-15 and subsequent assessment years.
