INCOME TAX NOTIFICATION NO.38

INCOME TAX NOTIFICATION NO.38

MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
NOTIFICATION
New Delhi, the 26th June, 2020
INCOME-TAX

G.S.R. 415(E).—In exercise of the powers conferred by sub-section (2) of section 115BAC read with
section 295 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. Short title and commencement: – (1) These rules may be called the Income-tax (13th Amendment) Rules, 2020.
    (2) They shall come into force from the 1st day of April, 2021 and shall accordingly apply in relation to the
    assessment year 2021-22 and subsequent assessment years.
  2. In the Income-tax Rules, 1962,-
    (a) in rule 2BB, after sub-rule (2), the following sub-rule shall be inserted, namely:—
    “(3) Notwithstanding anything contained in sub-rule (1) and (2), an employee, being an assessee, who
    has exercised option under sub-section (5) of section 115BAC shall be entitled to exemption only in
    respect of the allowances mentioned in sub-clauses (a) to (c) of sub-rule (1) and at serial no.11 of the
    Table below sub-rule (2) to the extent and subject to the conditions, if any, specified therein.”;
    (b) in rule 3, in sub-rule (7), in clause (iii), after the proviso, the following proviso shall be inserted,
    namely:—

“Provided further that the exemption provided in the first proviso in respect of free food and nonalcoholic
beverage provided by such employer through paid voucher shall not apply to an employee,
being an assessee, who has exercised option under sub-section (5) of section 115BAC.”.

GUDRUN NEHAR, Director (Tax Policy and Legislation)

Note: The principal rules were published in the Gazette of India, Extraordinary, Part-II, Section-3, Sub-section (ii)
vide number S.O. 969 (E), dated the 26th March, 1962 and last amended by the Income-tax (12th Amendment)
Rules, 2020, vide notification number G.S.R. 338 (E) dated 29.5.2020


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