Section 115S — the law in short
What the courts have decided on section 115S, in one screen. Read this first; open an entry when you need the facts, the reasoning and the source.
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Statutory position — s.115R, s.115S and s.115T: tax on income distributed by a mutual fund or UTI, the exemptions in the provisos to s.115R(2), and the deemed assessee in default
CBDT Circulars & InstructionsCuts both waysSuperseded by amendment
My client is a mutual fund trustee and has a demand for tax on income distributed to unit holders for a year before 2020. What rate applied to which kind of fund, what was exempt, and who is in default?
Section 115R(2) charged a specified company or a Mutual Fund to additional income-tax on income distributed to its unit holders on or before 31 March 2020, at twenty-five per cent where distributed to an individual or HUF by a money market mutual fund or a liquid fund, thirty per cent to any other person by such a fund, ten per cent to any person by an equity oriented fund, twenty-five per cent to an individual or HUF by any other fund, and thirty per cent to any other person by any other fund; sub-section (2A) grosses the distributed income up. Section 115S charges simple interest at one per cent a month for late payment of the s.115R tax, and s.115T deems the person responsible, and the specified company or Mutual Fund, to be an assessee in default with the whole recovery machinery applying.
Listed strongest first: Supreme Court, then High Court, then Tribunal, then CBDT. Nothing here has yet been read in full by a chartered accountant — open an entry to see where it came from.