Section 115BBH of Income Tax Act for AY 2023-24

Section-115BBH of Income Tax Act 1961 as amended by Finance Act 2022. Provisions related to tax on income from virtual digital asset.

Amended and updated notes on section 115BBH of Income Tax Act 1961 as amended by the Finance Act 2022 and Income-tax Rules, 1962. Detail discussion on provisions and rules related to No set off of losses consequent to search, requisition and survey.

Chapter XII (Sections 111 to 115BBI) of the Income Tax Act 1961 deals with the provisions related to determination of tax in certain special cases. Section 115BBH of IT Act 1961-2022 provides for tax on income from virtual digital asset.

Recently, we have discussed in detail section 102 (Definitions) of IT Act 1961.

Today, we learn the provisions of section 115BBH of Income-tax Act 1961 as newly inserted by the Finance Act 2022. The amended provision of section 115BBH is effective for financial year 2022-23 relevant to the assessment year 2023-24.

In this article, you will learn detail of the provisions of section 115BBH of the Income Tax Act, 1961 Bare Act read with the Income-tax Rules, 1962, regulations, notifications, circulars, orders and Press Release by CBDT, Income Tax Department and the Ministry of Law and Justice, Government of India.

Section-115BBH: Tax on income from virtual digital asset

[Section 115BBH newly inserted w.e.f. 1-April-2022 by the Finance Act 2022]

Section 115BBH (1):

Where the total income of an assessee includes any income from the transfer of any virtual digital asset, notwithstanding anything contained in any other provision of this Act, the income-tax payable shall be the aggregate of,—

  • (a) the amount of income-tax calculated on the income from transfer of such virtual digital asset at the rate of thirty per cent.; and
  • (b) the amount of income-tax with which the assessee would have been chargeable, had the total income of the assessee been reduced by the income referred to in clause (a).

Section 115BBH (2):

Notwithstanding anything contained in any other provision of this Act,—

  • (a) no deduction in respect of any expenditure (other than cost of acquisition, if any) or allowance or set off of any loss shall be allowed to the assessee under any provision of this Act in computing the income referred to in clause (a) of sub-section (1); and
  • (b) no set off of loss from transfer of the virtual digital asset computed under clause (a) of sub-section (1) shall be allowed against income computed under any provision of this Act to the assessee and such loss shall not be allowed to be carried forward to succeeding assessment years.

Section 115BBH (3):

For the purposes of this section, the word “transfer” as defined in clause (47) of section 2, shall apply to any virtual digital asset, whether capital asset or not.


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