QUESTION: It has been stated by the Finance Minister and others that the Direct Taxes Code Bill, 2010, will become effective from April 1, 2012. I presume that the income of the financial year 2012-13 would be subject to the Code. When will be the advance tax payable, if the Code were to become law from financial year 2012-13? Unless the Code Bill is passed well prior to due dates for payment of advance tax, there would be a mismatch between the tax payable in regular assessment and tax paid as advance tax. How does the law propose to deal with it?
ANSWER: Advance tax payable on the income liable for the financial year 2012-13 from which year the liability will arise under the Code will be only in the same financial year 2012-13 so that there is no scope for apprehended mismatch, if the Bill becomes law before March 31, 2012.
The distinction between financial year and assessment year will no longer persist in the Code.
Advance tax will be payable as under the present law on the income of the same year for which the tax is leviable.
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