CBDT Notified Safe Harbour Rules for Income From Selling Raw Diamonds in Any Notified Special Zone
- Blog|News|Income Tax|
- 2 Min Read
- By Taxmann
- |
- Last Updated on 2 December, 2024
Latest from Taxmann
Notification no. 124/2024, dated 29-11-2024
The Central Board of Direct Taxes (CBDT) has introduced Safe Harbour Rules for foreign companies engaged in the business of diamond mining. These companies must be engaged in the business of selling raw diamonds in any notified special zone. The Safe Harbour Rules are for the profits and gains of the business chargeable to tax under the head “Profits and gains of business or profession”.
The CBDT has inserted new rules 10TI, 10TIA, 10TIB, and 10TIC into the Income-tax Rules, 1962 to implement the Safe Harbour Rules. The rules contain the following key points:
- The Safe Harbour Rules apply to foreign companies engaged in the business of selling raw diamonds in any notified special zone as referred to in clause (e) of Explanation 1 to 9(1)(i).
- If the assessee can exercise the option for Safe Harbour, the profits and gains of the business chargeable to tax shall be 4% or more of the gross receipts from such business.
- The assessee can exercise the option for Safe Harbour by furnishing Form No. 3CEFC to the Assessing Officer before furnishing the return of income under section 139 for the relevant previous year.
- If the option for Safe Harbour is exercised, the following consequences shall apply:
-
- Deductions under sections 30 to 38 are deemed fully allowed, and no further claims are permitted.
- Depreciation is treated as claimed, and the written-down value (WDV) of assets is adjusted accordingly.
- Set-off of unabsorbed depreciation [Section 32(2)] or carried-forward business losses [Section 72(1)] is disallowed.
- Set-off of losses from other businesses [Section 70(1)] or other heads of income [Section 71(1)/(2)] against business profits is not allowed.
- The assessee exercising the option for Safe Harbour shall not be entitled to invoke a mutual agreement procedure under an agreement to avoid double taxation as referred to in section 90 or section 90A.
Click Here To Read The Full Notification
Disclaimer: The content/information published on the website is only for general information of the user and shall not be construed as legal advice. While the Taxmann has exercised reasonable efforts to ensure the veracity of information/content published, Taxmann shall be under no liability in any manner whatsoever for incorrect information, if any.
Taxmann Publications has a dedicated in-house Research & Editorial Team. This team consists of a team of Chartered Accountants, Company Secretaries, and Lawyers. This team works under the guidance and supervision of editor-in-chief Mr Rakesh Bhargava.
The Research and Editorial Team is responsible for developing reliable and accurate content for the readers. The team follows the six-sigma approach to achieve the benchmark of zero error in its publications and research platforms. The team ensures that the following publication guidelines are thoroughly followed while developing the content:
- The statutory material is obtained only from the authorized and reliable sources
- All the latest developments in the judicial and legislative fields are covered
- Prepare the analytical write-ups on current, controversial, and important issues to help the readers to understand the concept and its implications
- Every content published by Taxmann is complete, accurate and lucid
- All evidence-based statements are supported with proper reference to Section, Circular No., Notification No. or citations
- The golden rules of grammar, style and consistency are thoroughly followed
- Font and size that’s easy to read and remain consistent across all imprint and digital publications are applied
Sign Up
To subscribe to our weekly newsletter please log in/register on Taxmann.com
Latest Books
Everything on Tax and Corporate Laws of India
To subscribe to our weekly newsletter please log in/register on Taxmann.com
CA | CS | CMA
