New Delhi, April 30
Wealth tax won’t be levied on agricultural land even if it is located in the vicinity of urban centres within municipal limits. The government made this clear in the Lok Sabha today by introducing an amendment to the Finance Bill 2013 and stating that wealth tax was to be imposed only on urban lands. Urban lands did not include agricultural lands registered as such in state records and used for agricultural purposes.

Finance Minister P Chidambaram led the clarification in the Lower House which passed the General Budget, Demand for Grants of all Ministries and the Railway Budget without discussion. The completion of the budgetary exercise will allow the government to withdraw Rs 12 lakh crore (pegged expenditure for 2013-2014) from the Consolidated Fund of India.

The exercise was held in the absence of the Opposition BJP, JDU, BJD, TDP, Left Parties and the TMC and even UPA ally DMK that walked out to protest continuation of PC Chacko as chairman of the Joint Parliamentary Committee on the 2G scam. The Shiromani Akali Dal (SAD) stayed back to debate the wealth tax issue.

Though the BJP walked out to press for the Prime Minister and Law Minister’s resignation in the coal scam issue, other parties did so to slam the absence of debate on the Rs 12 lakh crore General Budget. “We disapprove of Budget passage without discussion,” said CPM Polit Bureau member Sitaram Yechury.

Earlier, Leader of Opposition in LS Sushma Swaraj accused the Government of institutionalising corruption. “Every new scam is bigger than the old. Not only does this government indulge in loot, it also shields the perpetrators…,” she said justifying the BJP walkout. “We won’t obstruct the financial business, but won’t participate in it either,” she added. Her jibes were returned by Parliamentary Affairs Minister Kamal Nath, who, goaded by UPA chief Sonia Gandhi, termed the BJP as obstructionist.

That apart, the wealth tax issue dominated discussions, with Chidambaram saying the UPA never had an intention of imposing the tax on farm land. In veiled references to the Akali rhetoric on the tax, the FM said canards had been spread on the issue.

“Misapprehensions arose due to some judgments of the Punjab and Haryana High Court. Canards were spread that the law was being amended whereas it has been the same since 1993.

To clarify matters, I got the PM’s nod and the President’s assent to move today’s amendment and clarify that urban land doesn’t include agricultural land. That should rest the matter,” Chidambaram said as Akali and Congress MPs sparred to take credit of the decision.

The FM later surprised everyone by refuting Akali MP Harsimrat Kaur Badal’s claim in the Lok Sabha that Punjab CM Parkash Singh Badal had first spoken to him on the issue. “The Punjab CM may have told her (Harsimrat) that, but I didn’t hear from him. I wish he had telephoned me or sent someone to see me. I am disappointed that I wasn’t the beneficiary of his advice,” Chidambaram said, crediting Punjab Congress Chief Partap Singh Bajwa, I&B Minister Manish Tiwari and MoS External Affairs Preneet Kaur instead with first highlighting the consequences of misapprehension over wealth tax levy. He then thanked Haryana CM Bhupinder Singh Hooda and other Congress MPs for seeking redress in the matter, obliterating Akalis from the picture.

• Railways exempted from service tax for July 1-October 1, 2012
• Government seeking authorisation to raise customs duty on cashew to 70% to protect domestic industry
• For enhanced investments in infrastructure bonds, FM proposed amendments to ensure that foreign currency routed through designated NRI accounts in such bonds was deemed to be considered borrowing in such currency
• FM said PAN requirement and consequently higher withholding 20% tax will not apply to interest paid to non-residents in respect of investment in long-term infra bonds
• No TAN needed for TDS deduction of 1% on transfer of registration of immovable property