The Committee constituted by the
Finance Minister to suggest the areas in respect of which further Income
Computation and Disclosure Standards (ICDS) may be notified under the Income
Tax Act, 1961 (‘the Act’) has suggested the notification of ICDS in respect of
Real Estate Transactions and submitted the draft of the same.
The draft ICDS submitted by the
committee is based on the Guidance Note issued on Real Estate Transactions
issued by Institute of Chartered Accountants of India (ICAI). For the purposes
of providing uniformity and certainty and harmonising the same with provisions
of the Act, the committee suggested certain changes in draft ICDS.
The
draft ICDS on Real Estate Transactions along with the significant changes
suggested in ICDS vis-à-vis the Guidance Note issued by ICAI are uploaded on
the Income-tax website at http://www.incometaxindia.gov.in. The Central Board of Direct Taxes (CBDT)
invites comments from stakeholders on the draft ICDS on Real Estate
Transactions, which may be submitted to Director TPL-III by e-mail at dirtpl3@nic.in by 26th May, 2017.
Section 145(2) of the Income-tax
Act, 1961 (‘the Act’) provides that the Central Government may notify Income
Computation and Disclosure Standards (ICDS) for any class of assessees or for
any class of income. Accordingly, Central Government notified 10 ICDS vide Notification No. S.O. 3079 (E) dated 29th September,
2016. These ICDS inter-alia contain provisions relating to valuation of
inventory; construction contracts; effects in changes of Foreign Exchange rates,
borrowing costs etc. These ICDS are applicable from assessment year 2017-18 (previous
year 2016-17) in respect of specified assessees for computation of income under
the head “Profits and gains of business or profession” or “Income from other
sources”.
The finance Minister had
constituted a Committee comprising of experts from Accounting field,
departmental officers and representatives from the Institute of Chartered
Accountants of India (ICAI) to suggest the areas in respect of which further
ICDS may be notified under the Act.
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DSM/VKS/KA
