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Charge of Securities Transaction Tax [Section 98] –
Securities transaction tax levied on the taxable securities transactions came into force from the 1st October, 2004. It is applicable on the following transactions -
S.No. |
Taxable Securities transaction |
Rate |
Payable by |
1. |
Purchase of an equity share in a company or a unit of an equity oriented fund, where(a)the transaction of such purchase is entered into a recognised stock exchange; and (b)the contract for the purchase of such or unit is settled by the actual delivery or transfer of such share or unit. |
0.1% |
Purchaser |
2. |
Sale of equity share in a company where -
(a)the transaction of such sale is entered into a recognised stock exchange; and
(b)the contract for the sale of such or unit is settled by the actual delivery or transfer of such share or unit. |
0.1% |
Seller |
2A. |
Sale of a unit of an equity oriented fund, where—
(a) the transaction of such sale is entered into in a recognised stock exchange; and
(b) the contract for the sale of such unit is settled by the actual delivery or transfer of such Unit. [w.e.f. O1.06.2013]. |
0.001% |
Seller
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3. |
Sale of equity share in a company or a unit of an equity oriented fund, where -
(a) the transaction of such sale is entered into a recognised stock exchange; and |
0.025% |
Seller |
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(b)the contract for the sale of such or unit is settled otherwise than by the actual delivery or transfer of such share or unit. |
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4. |
(a) Sale of an option in securities
(b) Sale of an option in securities, where option is exercised
(c) Sale of a futures in securities |
0.017%
0.125%
[0.01%] |
Seller Purchaser
Seller |
5. |
Sale of a unit of an equity oriented fund to the mutual fund. |
[0.001%] |
Seller |
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W.e.f. 01-10-2009, Securities Transaction Tax shall not apply to taxable securities transactions entered into by any person for, or on behalf of the New Pension Trust.
Value of taxable securities transaction [Section 99]—
(a) In the case of a taxable securities transaction relating to an option in securities, shall be-
(1) the option premium, in respect of transaction at sale of an option in securities.
(2) the settlement price, in respect of transaction at sale of an exercised option in securities.
(b) In the case of a taxable securities transaction relating to a derivative, being “futures”: shall be the price at which such “futures”.is traded; and
(c) In the case of any other taxable securities transaction, shall be the price at which such securities are purchased and sold.
Collection and Recovery of Securities Transaction Tax [Section 100]—
(1) Every recognised stock exchange shall collect the securities transaction tax from every person, being a purchaser or a seller, who enters into a taxable securities transaction in that stock exchange, at the prescribed rates.
(2) The prescribed person in the case of every Mutual Fund shall collect the securities transaction tax from every person who sells a unit to that Mutual Fund, at the rate specified.
(3) The securities transaction tax collected during any calendar month, shall be paid by every recognised stock exchange or prescribed person of Mutual Fund to the credit of the Central Government by the 7th of the month immediately following the said calendar month.
(4) Any recognised stock exchange or prescribed person of Mutual Fund , who fails to collect the tax be liable to pay the tax to the credit of the Central Government.
TABLE
Section |
Nature of Compliance |
Time Limit |
101(1) |
Furnish prescribed return in prescribed forms— (a) In the case of recognised stock ex- change in Form No. 1, (b) In the case of mutual fund in_Form_No. 2 |
Within 30 days after the end of each financial year. |
101(2)&(3) |
(a) Issue of notice to the assessee by Assessing Officer
(b) a revised return |
(a) where assessee fails to furnish the return within 30 days.
(b) where any assessee who discovers any omission or wrong statement therein. |
102 |
(a) No assessment shall be made
(b) Any amount is refunded to assessee on assessment |
(a) after the expiry of two years from the end of relevant financial year.
(b) within such time as may be in Form No. 4. |
103 |
Rectification of Mistake |
Within 1 year from the end of the financial year. |
104 |
Interest on delayed payment of tax |
Simple interest @1% of such tax for every month or part of a month. |
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Penalties [Section 105 to 108]-
Nature of default |
Amount of penalty |
1.
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Any assessee who fails to collect the whole or any part of securities transaction tax u/s 100. |
A sum equal to the amount of tax that he failed to collect, in addition to paying the tax and interest. |
2. |
Any assessee collected the tax but fails to pay such tax to the credit of the Central Government. |
A sum of Rs.1 000 for every day but do not exceed the amount of tax, along with the amount of tax and interest. |
3. |
An assessee fails to furnish return within due time. |
A sum of Rs. 100 for every day. |
4. |
Any person has failed to comply with a notice. |
In addition to any tax and interest, a sum of Rs. 10,000 for each failure. |
Note :—
No penalty shall be imposable for any failure, if the assessee proves that there was reasonable cause for the said failure. However, no order imposing a penalty, shall be made unless the assessee has been given a reasonable opportunity.
Application of certain provisions of Act 43 of 1961 [Section 109]—
The provisions of the following sections of the Income-tax Act,1961, as in force from time to time, shall apply, in relation to securities transaction tax as they apply in relation to income-tax, 120,131,1 33A, 156,178,220 to 227,229,232,260A, 261, 262,265 to 269,278B,282 and 288 to 293.
TABLE
Section |
Description of Appeals |
Time prescribed |
100 |
Where Assessing Officer passed order u/s 102 or 103 may appeal to Commissioner of Income-tax |
(a) within 30 days from the date of receipt of the order.
(b) Prescribed Form No. 5 with fee of Rs. 1,000 for every appeal. |
111 |
Appeal to Appellate Tribunal against an order passed by Commissioner of Income-tax U/s 110. |
Appeal shall be filed within 60 days in pre scribe Form No. 5 with fee of Rs. 1,000. |
112/113 |
If a person makes a false statement or accounts at the time of verification. |
Punishable with imprisonment which may extend to 3 years with fine. |
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