Section 15 of Finance Act 2018 : New section 43CB Income Tax Act Inserted

By | April 1, 2018
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(Last Updated On: April 14, 2018)

Section 15 of Finance Act 2018

[Section 15 of Finance Act 2018 deals with Insertion of new section 43CB. and is covered in CHAPTER III DIRECT TAXES]

Insertion of new section 43CB.

15. After section 43CA of the Income-tax Act, the following section shall be inserted and shall be deemed to have been inserted with effect from the 1st day of April, 2017, namely:—

“43CB. Computation of income from construction and service contracts.—

(1) The profits and gains arising from a construction contract or a contract for providing services shall be determined on the basis of percentage of completion method in accordance with the income computation and disclosure standards notified under sub-section (2) of section 145:

Provided that profits and gains arising from a contract for providing services,—

(i)with duration of not more than ninety days shall be determined on the basis of project completion method;
(ii)involving indeterminate number of acts over a specific period of time shall be determined on the basis of straight line method.

(2) For the purposes of percentage of completion method, project completion method or straight line method referred to in sub-section (1)—

(i)the contract revenue shall include retention money;
(ii)the contract costs shall not be reduced by any incidental income in the nature of interest, dividends or capital gains.”.

Finance Act 2018 : Assented by President : Download Print Notification

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