CBDT issued a notification no. 50/2015 dated 24 June 2015 and amend in income tax rules which is amendment no. 9 this year. This notification is about nature of business relationship. Full notification is as under.
In exercise of the powers conferred by section 295 read with subclause (viii) of Explanation to sub-section (2) of section 288 of the Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby makes the following rules further to amend
the Income-tax Rules, 1962, namely:-
1. (1) These rules may be called the Income-tax (Ninth Amendment) Rules, 2015.
(2) They shall come into force on the date of its publication in the Official Gazette.
2. In the Income-tax Rules, 1962, after rule 51, the following rule shall be inserted, namely:-
“51A. Nature of business relationship.— For the purposes of sub-clause (viii) of Explanation
below sub-section (2) of section 288, the term “business relationship” shall be construed as any
transaction entered into for a commercial purpose, other than, –
(i) commercial transactions which are in the nature of professional services permitted to be rendered by an auditor or audit firm under the Act and the Chartered Accountants Act, 1949 (38 of 1949) and the rules or the regulations made under those Acts;
(ii) commercial transactions which are in the ordinary course of business of the company at arm’s length price – like sale of products or services to the auditor, as customer, in the ordinary course of business, by companies engaged in the business of telecommunications, airlines, hospitals,
hotels and such other similar businesses.”
