AMIT BAJAJ ADVOCATE

As per the new amendment in rule 114B of Income Tax Rules, now PAN will also have to be furnished in respect of payment of LIC premium of aggregating Rs. 50000 or more in a year. PAN will also be required to be furnished while making payment to a dealer of Rs. 5 Lakh or more or against a bill of Rs 5 Lakh or more for purchase of bullion or jewellery. The word Dealer has been mentioned in newly added clause (r) to Rule 114B, but who will be considered as dealer is a question to be asked, since no corresponding explanation defining the word dealer has been added in the rule.



In exercise of the powers conferred by section 295 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend the Income-tax Rules, 1962, namely :—

1. (1) These rules may be called the Income-tax (Fifth Amendment) Rules, 2011.

(2) They shall come into force on the 1st day of July, 2011.

2. In the Income-tax Rules, 1962, in rule 114B,—

(i)  in the Explanation (a), in clause (k), for the words "tour operator" the words "tour operator, or to an
authorized person as defined in clause (c) of section 2 of the Foreign Exchange Management Act, 1999 (42 of 1999)" shall be substituted.

(ii)  in clause (l) for the words "for issue of a credit card" the words "for issue of a credit or debit card" shall be substituted.

(iii)  after clause (p) and before the first proviso, the following clauses shall be inserted, namely :—

"(q)  payment of an amount aggregating fifty thousand rupees or more in a year as life insurance premium to an insurer as defined in clause (9) of section 2 of the Insurance Act, 1938 (4 of 1938);

(r)  payment to a dealer,—

(i)  of an amount of five lakh rupees or more at any one time; or

(ii) against a bill for an amount of five lakh rupees or more, for purchase of bullion or jewellery;".


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