Finance Act, 1974

Amendment of section 219 of Income Tax Act, 1967.

47.Section 219 of the Income Tax Act, 1967 , is hereby amended by the substitution for subsection (1) of the following subsection:

“(1) It is hereby declared that in computing, for the purposes of Case I of Schedule D, the profits or gains of a society there are to be deducted as expenses any sums which—

(a) represent a discount, rebate, dividend, or bonus granted by the society to members thereof or other persons in respect of amounts paid or payable by or to them on account of their transactions with the society being transactions which are taken into acount in the said computation, and are calculated by reference to the said amounts or to the magnitude of the said transactions and not by reference to the amount of any share or interest in the capital of the society;

(b) are share or loan interest paid by the society being interest wholly and exclusively laid out or expended for the purposes of the trade.”.

Paragraph (b) shall apply for the year 1974-75 and subsequent years of assessment to any payment of annual interest whenever made and for the year 1973-74 to any payment of annual interest in respect of any period beginning on or after the 10th day of January, 1974.