NOTIFICATION NO 45/2008, Dated: March 24, 2008

In exercise of the powers conferred by Section 295 of the Income-tax read with sub-section (2) of Section 14A 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 (Fifth Amendment) Rules, 2008.

(2) They shall come into force from the date of their publication in the Official Gazette.

2. In the Income Tax Rules, 1962, after rule 8C, the following rule shall be inserted, namely:-

“Method for determining amount of expenditure in relation to income not includible in total income.
8D(1) Where the Assessing Officer, having regard to the accounts of the assessee of a previous year, is not satisfied with-

(a) the correctness of the claim of expenditure made by the assessee; or

(b) the claim made by the assessee that no expenditure has been incurred, in relation to income which does not form part of the total income under the Act for such previous year, he shall determine the amount of expenditure in relation to such income in accordance with the provisions of sub-rule (2).

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