Leased As

As part of the Pre-Budget recommendations made to the Ministry of Finance, CII has suggested alignment of the domestic tax system with the financial industry's business requirements and removal of tax barriers for the country's development process.

CII has recommended that budget 2009-10 should be an 'Investment Budget' to enable India to deal with the global economic crisis and aim for a revival of the economy. In tandem with the proposal, CII has recommended that tax pass through status for all venture capital funds registered with SEBI be reinstated. Section 10(23FB) restricts the scope of pass through to investing in certain specified sectors.

To boost availability of long term finance for industrial, agriculture or infrastructural facility, CII also advocated reinstatement of special reserve benefit under section 36(1) (viii) of the Income tax Act in respect of profits arising out of business of providing long term finance to all specified entitles including banks.

In addition, CII has strongly recommended that derivative trading activities undertaken by banks and financial institutions should be treated at par with other business activities for the purpose of Income Tax Act. In another proposal concerning investments in Portfolio Management Schemes, CII has suggested that income of an investor who engages a professional discretionary portfolio manager registered with SEBI should be booked as capital gains and not business income.

To reduce the voluminous processing of forms by the IT department and ensuring that the tax benefit is received by banks inspite of non receipt of TDS certificates from its borrowers/customers, banks be granted exemption from TDS under Section 196. Alternatively TDS credit should be allowed even on non-receipt of TDS certificates on the basis of indemnity from banks that no additional claim will be will raised again for TDS credit.

In a bid to place private banks at par with nationalized banks, CII has urged that benefit of section 72A should be