Finance Act, 1967

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Amendment of Chapter II of Part XXV of Income Tax Act, 1967.

9.—(1) In section 383 of the Income Tax Act, 1967 , “thirty years” is hereby substituted for “twenty years” and in section 386 (2) of that Act “nineteen years” and “twentieth year” are hereby substituted for “three years” and “fourth year” respectively.

(2) Accordingly—

(a) in section 386 of that Act, the following subsections are hereby substituted for subsections (3) to (7):

“(3) (a) So much of the net income tax, for the year of assessment (hereafter in this Chapter referred to as the twenty-first year) next following the twentieth year, as is equal to the appropriate sum shall not be payable.

(b) In paragraph (a) of this subsection ‘the appropriate sum’ means the sum which bears the same proportion to the net income tax for the twenty-first year as the number of days in the period beginning on the 6th day of April in the first year and ending on the day immediately preceding the commencement day bears to the total number of days in the first year.

(4) (a) Subsection (3) shall be subject to the proviso that, where the company ceases permanently within the twenty-first year to carry on the trade of working the mine, then—

(i) if the cessation occurs before or on the last day of the period of two hundred and forty months beginning on the commencement day, the net income tax for the twenty-first year shall not be payable, and

(ii) if the cessation occurs after the expiration of that period, so much of the net income tax for the twenty-first year as is equal to the appropriate sum shall not be payable.

(b) In paragraph (a) (ii) of this subsection ‘the appropriate sum’ means the sum which bears the same proportion to the net income tax for the twenty-first year as the number of days, in the period beginning on the 6th day of April in the twenty-first year and ending on the last day of the period of two hundred and forty months beginning on the commencement day, bears to the number of days in the period beginning on the 6th day of April in the twenty-first year and ending on the date of the cessation.”;

(b) in section 387 of that Act—

(i) subsections (1) (b) (iii) and (iv) and (3) (c) are hereby deleted,

(ii) in subsection 2 (a), “exemption period” and “two hundred and forty months” are hereby substituted for “first term” and “forty-eight months” respectively,

(iii) in subsection (2) (b) for all words from “provided” to the end of the paragraph there is hereby substituted “but where the dividend period is not wholly within the exemption period, the company shall not be entitled to deduct income tax from any part of the relevant payment which is referable to any part of the dividend period within the exemption period”,

(iv) in subsection (3) (a) and in subsection (3) (b) “exemption period” is hereby substituted for “first term”;

(c) in section 389 of that Act, “twenty-first year” is hereby substituted for “ninth year” in both places where the latter words occur and “exemption period” is hereby substituted for “first term or the second term”.