Amended and updated notes on section 115JC of Income Tax Act 1961 as amended by the Finance Act 2022 and Income-tax Rules, 1962. Detail discussion on provisions and rules related to special provisions for payment of tax by certain persons other than a company.
Chapter XIIBA (Sections 115JC to 115JF) of the Income Tax Act 1961 deals with the provisions related to special provisions relating to certain limited liability partnerships. Section 115JC of IT Act 1961-2020 provides for special provisions for payment of tax by certain persons other than a company.
Recently, we have discussed in detail section 115JB (Special provision for payment of tax by certain companies) of IT Act 1961.
Today, we learn the provisions of section 115JC of Income-tax Act 1961 as amended by the Finance Act 2022. The amended provision of section 115JC is effective for financial year 2022-23 relevant to the assessment year 2023-24.
In this article, you will learn detail of the provisions of section 115JC of the Income Tax Act, 1961 Bare Act read with the Income-tax Rules, 1962, regulations, notifications, circulars, orders and Press Release by CBDT, Income Tax Department and the Ministry of Law and Justice, Government of India.
Section-115JC: Special provisions for payment of tax by certain persons other than a company
Section 115JC (1):
Notwithstanding anything contained in this Act, where the regular income-tax payable for a previous year by a person, other than a company, is less than the alternate minimum tax payable for such previous year, the adjusted total income shall be deemed to be the total income of that person for such previous year and he shall be liable to pay income-tax on such total income at the rate of eighteen and one-half per cent.
Section 115JC (2):
Adjusted total income referred to in sub-section (1) shall be the total income before giving effect to this Chapter as increased by—
- (i) deductions claimed, if any, under any section (other than section 80P) included in Chapter VI-A under the heading “C.—Deductions in respect of certain incomes”;
- (ii) deduction claimed, if any, under section 10AA; and
- (iii) deduction claimed, if any, under section 35AD as reduced by the amount of depreciation allowable in accordance with the provisions of section 32 as if no deduction under section 35AD was allowed in respect of the assets on which the deduction under that section is claimed.
Section 115JC (3):
Every person to whom this section applies shall obtain a report, before the specified date referred to in section 44AB, in such form as may be prescribed, from an accountant referred to in the Explanation below sub-section (2) of section 288, certifying that the adjusted total income and the alternate minimum tax have been computed in accordance with the provisions of this Chapter and furnish such report by that date.
[Sub-section (3) of section 115JC has been amended w.e.f. 01.04.2020 by the Finance Act 2020.]
Section 115JC (4):
Notwithstanding anything contained in sub-section (1), where the person referred to therein, is a—
- (i) unit located in an International Financial Services Centre and derives its income solely in convertible foreign exchange, the provisions of sub-section (1) shall have effect as if for the words “eighteen and one-half per cent.”, the words “nine per cent.” had been substituted;
- (ii) co-operative society, the provisions of sub-section (1) shall have effect as if for the words “eighteen and one-half per cent.”, the words “fifteen per cent.” had been substituted.
[Sub-section (4) of section 115JC has been amended (substituted) w.e.f. 1-April-2023 by the Finance Act 2022.]
Section 115JC (5):
The provisions of this section shall not apply to a person who has exercised the option referred to in section 115BAC or section 115BAD.
[Sub-section (5) of section 115JC shall be inserted w.e.f. 01.04.2021 by the Finance Act, 2020]