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Date: 03-Mar-2023 Category: Extra Ordinary State: Union Government Country: India

Notification under clause (46) of section 10 of the Income tax Act, 1961 (43 of 1961).

Issued by Ministry of Finance · Department of Revenue

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Executive Summary & Key Takeaways

What it means

  • The notification issued by the Ministry of Finance, Department of Revenue, Central Board of Direct Taxes, exempts the Karnataka State Building and Other Construction Workers Welfare Board from income tax on specific income sources.
  • The exemption is granted under Section 10(46) of the Income-tax Act, 1961.
  • The exemption applies to income from cess collected under the Building and Other Construction Workers’ Cess Act, 1996, registration fees and annual subscriptions from establishments, and interest earned on these funds.

Key Changes

  • The Karnataka State Building and Other Construction Workers Welfare Board (PAN AAALK0820C) is granted income tax exemption on specific income.
  • The exemption is applicable retrospectively for the financial year 2020-21 (from 01-06-2020 to 31-03-2021) and 2021-2022.
  • The exemption is also applicable for the financial years 2022-2023, 2023-2024, and 2024-2025.
  • The Board must not engage in any commercial activity to maintain the exemption.
  • The activities and nature of specified income must remain unchanged throughout the financial years.
  • The Board is required to file income tax returns as per Section 139(4C)(g) of the Income-tax Act, 1961.

Impact Analysis

Karnataka State Building and Other Construction Workers Welfare Board

  • Action Item: The Board should review its financial activities to ensure alignment with the notification's conditions.

Construction Workers

  • Action Item: The Board should prioritize welfare schemes that directly benefit construction workers.

Government of Karnataka

  • Action Item: The State Government should monitor the Board's activities to ensure compliance and effective utilization of funds.

Central Board of Direct Taxes (CBDT)

  • Action Item: CBDT should establish a mechanism for monitoring the Board's compliance and reporting.

Key Entities Referenced

Karnataka State Building and Other Construction Workers Welfare Board: A board constituted by the State Government of Karnataka for the welfare of building and other construction workers. Income-tax Act, 1961: The principal legislation governing income tax in India. Section 10(46) provides for exemption of income of certain bodies or authorities. Building and Other Construction Workers’ Cess Act, 1996: An act providing for the levy and collection of a cess on construction costs for the welfare of building and other construction workers.
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रजजस्ट्री स.ं डी.एल.- 33004/99 REGD. No. D. L.-33004/99 xxxGIDHxxx सी.जी.-डी.एलxx.x-GअID.-E0x3xx0 32023-244108 CG-DL-E-03032023-244108 ऄसाधारण EXTRAORDINARY भाग II—खण् ड 3—ईप-खण्ड (ii) PART II—Section 3—Sub-section (ii) प्राजधकार स ेप्रकाजित PUBLISHED BY AUTHORITY स.ं 1003] नइ ददल्ली, िुक्रिार, माचड 3, 2023/फाल्ग नु 12, 1944 No. 1003] NEW DELHI, FRIDAY, MARCH 3, 2023/PHALGUNA 12, 1944 जित्त मत्रं ालय (राजस्ट्ि जिभाग) (केंद्रीय प्रत्यक्ष कर बोडड) ऄजधसचू ना नइ ददल्ली, 3 माचड, 2023 का.अ. 1044(ऄ),—केन्द्द्रीय सरकार, अयकर ऄजधजनयम, 1961 (1961 का 43) की धारा 10 के खंड(46)द्वारा प्रदत्त िजियों का प्रयोग करते हुए,ईि खंड के प्रयोजनाथ,ड कनाडटक राज्य भिन और ऄन्द्य जनमाडण कामगार कल्याण बोड ड (पैनः-AAALK0820C), कनाटड क राज्य सरकार द्वारा गठित एक बोडड,को ईस बोडड को ईद्भूत होने िाली जनम्नजलजखत जिजनर्ददष्ट अय के संबंध म ेंऄजधसूजचत करती ह,ै ऄथाडत:् - (क) भिन एिं ऄन्द्य जनमाडण कामगार ऄजधजनयम, 1996 की धारा 3(1) के तहत िसूली गइ जनमाणड लागत पर एकजत्रत ईपकर; (ख) संस्ट्थापनाओं से प्राप्त पंजीकरण िुल्क एि ंिार्षिक ऄंिदान; और (ग) ईि (क) तथा (ख) से ऄर्षजत ब्याज। 2. यह ऄजधसूचना आन ितों के ऄध्यधीन प्रभािी होगी दक कनाडटक राज्य भिन एिं ऄन्द्य जनमाडण कामगार कल्याण बोडड:- (क) दकसी व्यािसाजयक कायडकलाप में जलप्त नहीं होगा; (ख) समस्ट्त जित्तीय ििों के दौरान कायडकलाप तथा जिजनर्ददष्ट अय की प्रकृजत ऄपठरिर्षतत रहगे ी; और 1467 GI/2023 (1)2 THE GAZETTE OF INDIA : EXTRAORDINARY [PART II—SEC. 3(ii)] (ग) अयकर ऄजधजनयम 1961, की धारा 139 की ईप-धारा(4ग) के खंड(छ) के प्रािधानों के ऄनुसार अयकर जििरणी फाआल करेगा। 3. यह ऄजधसूचना जित्तीय ििड 2020-21 (ददनांक 01-06-2020 से ददनांक 31-03-2021 की ऄिजध के जलए)और जित्तीय ििड 2021-2022 के जलए लाग ू की गइ मानी जाएगी तथा यह जित्त ििों 2022-2023, 2023-2024, तथा 2024-2025के संबंध में लागू होगी। [ऄजधसूचना सं. 12/2023/फा. सं. 300196/61/2018-अइटीए-I] सौरभ जैन, ऄिर सजचि स्ट्पिटीकरण ज्ञापन यह प्रमाजणत दकया जाता ह ै दक आस ऄजधसूचना को भूतलक्षी प्रभाि देन े से दकसी व्यजि पर प्रजतकूल प्रभाि नहीं पड़ रहा ह।ै MINISTRY OF FINANCE (Department of Revenue) (CENTRAL BOARD OF DIRECT TAXES) NOTIFICATION New Delhi, the 3rd March, 2023 S.O. 1044(E).—In exercise of the powers conferred by clause (46) of section 10 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies for the purposes of the said clause, Karnataka State Building and Other Construction Workers Welfare Board (PAN AAALK0820C), a Board constituted by the State Government of Karnataka, in respect of the following specified income arising to that Board, namely:- (a) Cess collected on construction cost levied u/s 3(1) of the Building and Other Construction Workers’ Cess Act, 1996; (b) Registration fee & annual subscriptions received from the establishments; and (c) Interest earned on (a) & (b) above. 2. This notification shall be effective subject to the conditions that Karnataka State Building and Other Construction Workers Welfare Board,- (a) shall not engage in any commercial activity; (b) activities and the nature of the specified income shall remain unchanged throughout the financial years; and (c) shall file return of income in accordance with the provision of clause (g) of sub-section (4C) of section 139 of the Income-tax Act, 1961. 3. This notification shall be deemed to have been applied for the financial year 2020-2021 (for period from 01- 06-2020 to 31-03-2021) and for the financial year 2021-2022 and shall be applicable with respect to the financial years 2022-2023, 2023-2024 and 2024-2025. [Notification No. 12/2023/F.No.300196/61/2018-ITA-I] SOURABH JAIN, Under Secy. Explanatory Memorandum It is certified that no person is being adversely affected by giving retrospective effect to this notification. Uploaded by Dte. of Printing at Government of India Press, Ring Road, Mayapuri, New Delhi-110064 and Published by the Controller of Publications, Delhi-110054.

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