Amended and updated notes on section 99 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 treatment of connected person and accommodating party.
Chapter XA (Sections 95 to 102) of the Income Tax Act 1961 deals with the provisions related to General Anti-Avoidance Rule. Section 99 of IT Act 1961-2020 provides for treatment of connected person and accommodating party.
Recently, we have discussed in detail section 98 (Consequences of impermissible avoidance arrangement) of IT Act 1961. Today, we learn the provisions of section 99 of Income-tax Act 1961. The amended provision of section 99 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 99 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-99: Consequences of impermissible avoidance arrangement
For the purposes of this Chapter, in determining whether a tax benefit exists,—
- (i) the parties who are connected persons in relation to each other may be treated as one and the same person;
- (ii) any accommodating party may be disregarded;
- (iii) the accommodating party and any other party may be treated as one and the same person;
- (iv) the arrangement may be considered or looked through by disregarding any corporate structure.