Economy

Trading in power exchanges exempt from new levies under Income Tax Act: PXIL

Our Bureau New Delhi | Updated on October 01, 2020 Published on October 01, 2020

The Central Board of Direct Taxes (CBDT) has exempted power trading transactions through online exchanges from the newly imposed sections of the Income Tax Act, according to Power Exchange India Ltd (PXIL).

A PXIL statement said power trading on its platform has been exempted from Section 194 (O) - Tax Deducted at Source (TDS) on E-Commerce Transactions and section 206C (1H) - Tax collected at source (TCS) on Sale of Goods on E-Commerce platform, of Income tax Act, 1961.

The Finance Act 2020, had imposed a levy of 1 per cent and 0.1 per cent on all e-commerce transactions above ₹50 lakh under TDS and TCS with effect from October 1.

“It was observed that there were practical difficulties in implementing these taxes in case of power exchanges, like securities and commodities transactions traded through recognised stock and commodities exchanges or cleared and settled through recognised clearing corporations,” PXIL said.

PXIL said it had made a representation to the CBDT for exemption.

Commenting on the development, Prabhajit Kumar Sarkar, Managing Director and Chief Executive Officer, PXIL, said, “We welcome the guidelines from the CBDT for considering our appeal and exempting the transactions traded through power exchanges from the applicability of the new TDS and TCS provision. This exemplifies the confidence reposed on exchange traded power and PXIL by the government as an important market infrastructure for the development of the power market.”

PXIL is promoted by NSE (National Stock Exchange of India Ltd) and NCDEX (National Commodity and Derivatives Exchange).

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Published on October 01, 2020
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