GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
(CENTRAL BOARD OF DIRECT TAXES)
NOTIFICATION
New Delhi, the 15th July, 2013.
(INCOME‐TAX)
S.O. 2166(E).– In exercise of the powers conferred by section 295 read
with sub‐section (1) of section 35CCD 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 (10th
Amendment) Rules, 2013.
2.1
They
shall come into force on the date of their publication in the Official Gazette.
- In
the Income‐tax Rules, 1962 (hereafter referred to as the said rules),
after rule 6AAE, the following shall be inserted, namely:‐
“6AAF.Guidelinesfor approval of skill development project
under section 35 CCD.—
1.
A skill development project shall be considered
for notification if it is undertaken by an eligible company and the projects
undertaken in separate facilities in a training institute.
2.
The eligible company, before undertaking any skill
development project, shall make an application for notification of such project
under sub‐section (1) of section 35CCD, in duplicate, in Form No. 3CQ, to the National
Skill Development Agency (here in after referred to as the NSDA).
3.
The eligible company shall also send a copy of
the application in Form No. 3CQ to the Commissioner of Income‐tax or the
Director of Income‐tax, as the case may be, having jurisdiction over the case,
accompanied by the acknowledgement receipt as evidence of having furnished the
application Form in duplicate to the NSDA.
4.
The application shall be accompanied by the following,
namely:–
a)
Detailed note on the skill development project
to be undertaken by the eligible company;
b)
Details of the expenditure expected to be
incurred on the project and expected date of completion of the project; and
c)
A letter of concurrence from the training
institute in which the skill development project is to be undertaken.
5.
If any defect is noticed in the application
referred to in sub‐rule (2) or if any relevant document is not attached
thereto, the NSDA shall, before the expiry of one month from the date of
receipt of the application in its office, intimate the defect to the applicant for
its rectification.
6.
The applicant shall remove the defect within a
period of fifteen days from the date of such intimation or within such further
period as, on an application made in this behalf, may be extended by the NSDA, so
however, that the total period for removal of the defect does not exceed thirty
days, and if the applicant fails to remove the defect within such period so
allowed, the NSDA shall send its recommendation for treating the application as
invalid to the CBDT.
7.
On receipt of recommendation of the NSDA under sub‐rule
(6), the CBDT, if satisfied, may pass an order treating the application as invalid.
8.
If the application form is complete in all respects,
the NSDA may make such inquiry or call for such documents from the eligible
company or the training institute as it may consider necessary for satisfying itself
regarding the genuineness of the current and proposed activity of the applicant
and send its recommendation to the CBDT for grant of approval or rejection of
the application before the expiry of the period of two months to be reckoned
from the end of the month in which the application form complete in all respects
was received in its office.
9.
The Commissioner of Income‐tax or the Director
of Income‐tax, as the case may be, having jurisdiction over the case shall send
his recommendation to the NSDA for grant of approval or rejection of the
application, after considering the compliance of the applicant with the various
provisions of Income‐tax Act, 1961 and Wealth‐tax Act, 1957, before the expiry
of the period of one month to be reckoned from the end of the month in which
the copy of the application was received in his office.
10.
If the NSDA recommends the grant of approval
under sub‐rule (8), the CBDT shall, within a period of fifteen days from the
end of the month in which it receives the report from the NSDA, under
sub‐section (1) of section 35CCD, issue a notification in Form No. 3CR to be
published in the Official Gazette specifying the skill development project
subject to conditions mentioned in rule 6AAG or such other conditions, as it
may deem fit, to be effective for such period not exceeding three assessment
years and if the NSDA recommends the rejection of the application under
sub‐rule (8), the CBDT shall pass an order rejecting the application.
11.
If the CBDT is satisfied with the activities of
the skill development project during the period of notification, it may notify
the said project for a further period in consultation with the NSDA.
12.
A copy of the notification issued under sub‐rule
(10) or sub‐rule (11) shall be sent to the applicant, the NSDA, the training
institute and the Commissioner of Income‐tax or the Director of Income‐tax, as the
case may be, having jurisdiction over the case.
13.
The CBDT may rescind the notification issued
under sub‐rule (10) or sub‐rule (11) at any time, if it is satisfied that the
eligible company or the training institute, as the case may be, has ceased its activities
or its activities are not genuine or the activities of the skill development
project are not being carried out in accordance with all or any of the relevant
provisions of the Act or this rule or rule 6AAG or the conditions subject to
which the notification was issued.
14.
An order rescinding the notification shall not
be passed unless the applicant has been given an opportunity of being heard in
the matter.
15.
A copy of any order invalidating or rejecting
the application or rescinding the notification shall be sent to the applicant,
the training institute, the NSDA and the Commissioner of Income‐tax or the Director
of Income‐tax, as the case may be, having jurisdiction over the case.
6AAG. Conditions subject to which a skill development
project is to be notified under section 35CCD.
1.
The company undertaking skill development
project shall maintain separate books of account of the skill development
project notified under sub‐section (1) of section 35CCD, and get such books of account
audited by an accountant as defined in the Explanation below sub‐section (2) of
section 288.
2.
The audit
report referred to in sub‐rule (1) shall include the comments of the auditor on
the true and fair view of the books of account maintained for skill development
project, the genuineness of the activities of the skill development project and
fulfillment of the conditions specified in the relevant provisions of the Act
or the rules or the conditions mentioned in the notification issued under sub‐rule
(10) or sub‐rule (11) of rule 6AAF.
3.
A skill development project in respect of
existing employees of the company shall not be eligible for notification under sub‐section
(1) of section 35CCD, where the training of such employees commences after six months
of their recruitment.
4.
All expenses (not being expenditure in the
nature of cost of any land or building), incurred wholly and exclusively for
undertaking a notified skill development project shall be eligible for
deduction under section 35CCD:
Provided that any expenditure incurred on the skill
development project which is reimbursed or reimbursable to the company by any
person, whether directly or indirectly, shall not be eligible for deduction
under section 35CCD.
5.
The company shall, on or before the due date of
furnishing the return of income under sub‐section (1) of section 139, furnish
the audited statement of accounts of the skill development project for the previous
year along with the audit report and amount of deduction claimed under
sub‐section (1) of section 35CCDto the Commissioner of Income‐tax or the Director
of Income‐tax, as the case may be.
6.
If the Commissioner of Income‐tax or the
Director of Income‐tax, as the case may be, is satisfied that the,‐
a)
company has not maintained separate books of
account for the skill development project or has not got such books of account
audited by an accountant in accordance with sub‐rule (1);
b)
company has not furnished the documents referred
to in sub‐rule (5);
c)
company has ceased to carry out activities of skill
development project;
d)
activities of skill development project of the
company are not genuine; or
e)
activities of the skill development project of
the company are not being carried out in accordance with the relevant
provisions of the Act or the rules or the conditions subject to which the notification
was issued, he shall, after making appropriate inquiries, furnish a report on
the circumstances referred to in clause (a) to (e) to the CBDT for appropriate
action under sub‐rule (13) of rule 6AAF.
7.
If the NSDA is not satisfied about the
genuineness of the activities of the notified skill development project, the NSDA
shall send its recommendation to the CBDT for appropriate action under sub‐rule
(13) of rule 6AAF.
6AAH. Meaning of expressions used in rule 6AAF and rule
6AAG–
For the purposes of rule 6AAF and rule 6AAG–
- “Eligible company” means a company, which
is‐
a)
engaged in the business of manufacture or
production of any article or thing, not being an article or thing mentioned at serial number 1 and serial number
2 of the list of articles or things specified in the Eleventh Schedule;
or
b)
engaged in providing services mentioned in
column (2) of the Table below:
TABLES. No. (1) Particulars
(2)
- Accounting services
- Architect services
- Automobile repair or maintenance
- Banking, insurance and financial services
including ATM installation, maintenance and operations or banking
correspondents or insurance agents
- Beauty and cosmetology, including hair
styling or manicurists or pedicurists
- Cable operators or Direct to Home (DTH) services
- Cargo Handling and stevedoring services
- Construction including painting or
woodwork or plumbing or flooring or electrical wiring or installation or maintenance
of lifts
- Courier services
- Design services including fashion or gems
and jewellery or apparel or industrial designing
- Event management
- Facilities management, housekeeping,
cleaning services
- Fire and safety services
- Food processing or preservation services,
including post harvesting and Post farm ‐gate skills
- Health and Wellness services including spa
or nutritionists or weight management or health instructors or yoga or gym
trainers
- Home décor services, landscaping
- Hospital and Healthcare services, such as
Lab technicians, nursing and other paramedical staff
- Hospitality, including culinary skills or
catering services
- Logistics and Transportation by any mode,
including by air, sea, road, rail or pipelines, and related services such
as driving or operation of heavy machinery equipment, forwarding agents,
packers and movers
- Market research services
- Media or film or advertising
- Mining and extraction of mineral resources,
including hydrocarbons23. Packaging and Warehousing, including both
ambient temperature storage and cold storage, operation of Internal
Container Depots and Container Freight Stations
- Port and maritime services such as
dredging, piloting, tug boat operations, shipbuilding, ship scrapping,
bunkering
- Power Sector Services, including those
required for erection or installation or maintenance of equipment or
towers, etc. in generation, transmission or distribution sector projects
- Private Security, including guards,
supervisors, installation and maintenance of security equipment etc.
- Refrigeration and air‐conditioning
- Repair and maintenance services, including
Installation and servicing of household goods or white goods
- Retail marketing, including shop floor
assistants or merchandisers
- Telecom services, including erection and maintenance
of towers
- Travel and tourism, including guides or ticketing
or sales or cab drives
- “Training institute” means a training
institute set up by the Central or State Government or a local authority
or a training institute affiliated to National Council for Vocational Training
or State Council for Vocational Training.
- “National Council for Vocational Training”
means the National Council for Training in Vocational Trades established
by the resolution of the Government of India in the Ministry of Labour (Directorate
General of Resettlement and Employment) No.TR/E.P. – 24/56, dated the 21st
August 1956 and re‐named as the National Council for Vocational Training
by the resolution of the Government of India in the Ministry of Labour
(Directorate General of Employment and Training) No. DGET/12/21/80‐TC,
dated the 30th September, 1981.
- “State Council for Vocational Training”
means a State Council for Training in Vocational Trades established by the
State Government.”
- In Appendix‐II of the said rules, after
Form No. 3CP, the following forms shall be inserted, namely: ‐
FORM NO. 3CQ
[See
rule 6AAF]
Application form for approval under sub‐section (1) of section
35CCDofthe Income‐tax Act, 1961
i.
Name of the applicant company.
ii.
Address of the registered office of the applicant
company.
iii.
Address
of the principal place of business if it is different from registered office.
iv.
PAN of the Company.
v.
Date of incorporation of the company.
vi.
Enclose a copy of the Memorandum and Articles of
Association.
vii.
If the skill development project of the company was
notified earlier under sub‐section (1) of section 35CCD, mention the
notification number and date of the latest notification and furnish a copy of the
same.
viii.
Nature of business
ix.
If notification issued under sub‐section (1) of section
35CCD was rescinded in the past, mention reasons on account of which the
notification was rescinded.[Enclose a copy of the Order(s)rescinding notification(s)}
x.
Date from which notification of skill development
project is requested for.
xi.
Expected date of completion of project.
- Purpose of the skill development
project(Give a brief write up on the requirement of skill development
project indicating the objectives of the project, stages of implementation,
expected results and usefulness of the project.)
- Details of expenses (other than land or
building) expected to be incurred for skill development project.
- Skill development projects undertaken by
the applicant:
i.
Skill development projects, if any, undertaken
by the company during last five years along with their current status.
ii.
Details of skill development projects, if any,
which have been taken up in the past and which are underway on the date of
filing of application.
- Name and address of the training
institute in which the skill development project is to be undertaken.(Enclose
a copy of letter of concurrence from the training institute in which the
skill development project is to be undertaken)
- Details of Return of Income filed for the
last three Assessment years:
Assessment Year Turnover/ Gross receipts Total income Tax payable as per
return Tax Paid Assessed
Income details
- Enclose copy of audited annual accounts of
the company for the last three years.
- Whether any penalty under clause (c) of sub‐section
(1) of section 271 was levied on the company during the last five years
and details thereof.
- Whether any tax demand is outstanding on
the date of filing application.
Certified that the
above information is true to the best of my knowledge and belief.
Place ………………………………
Signature ………………………………
Date ……………………………
Designation………………………………
Full Address
FORM
NO.3CR
[See
rule 6AAF]
Form for notification of skill development project under sub‐section
(1) of section 35CCD of the Income‐tax Act, 1961
- Name, address and PAN of the company
- Name and address of the training Institute
in which the skill development project is to be undertaken
- Title of the skill development project
- Purpose of the skill development project
- Reference No. and date of the application
- Date of commencement of the skill
development project
- Duration of the skill development project
in months
- Assessment year(s)for which the skill
development project was notified (not exceeding three years)
- Total expenses likely to be incurred for the
skill development project(other than land or building)
- Conditions, if any, subject to which
skill development project is notified.
Place:
(Signature)
Date:
(Name and Designation)
Copy to:
(1)
The applicant
(2)
Training institute.
(3)
National Skill Development Agency.
(4)
The
Commissioner of Income‐tax/Director of Income‐tax.”
Notification No. 54/2013, F.No.142/29/2012‐SO(TPL)]
(J.Saravanan),
Under Secretary to the Government of India.
Note: The principal rules were published in the Gazette of India,
Extraordinary, Part II, Section 3, and Sub‐Section (ii) vide notification
number S.O. 969(E), dated the 26th March, 1962 and last amended by the Income‐tax
(9th Amendment) Rules, 2013, vide notification number S.O.2017(E), dated the
4th July, 2013 .
Read Also:
Sec. 35CCD-Expenditure on Skill Development Project (Vocational Education)
Link:
Notification No. 54/2013
