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Rashmin Sanghvi & Associates

Chartered Accountants

109, 1st Floor, Arun Chambers,
Tardeo Road,
Mumbai - 400 034,
Maharashtra, India.

Tel. Nos.: (+91 22) 2351 1878, 2352 5694.

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Indian Budget - Economy & Philosophy 2002

Indian Budget. Economy & Philosophy 2002

Date : 25th May, 2002

1. We have presented in this paper, our brief analysis of the Finance Act, 2002 (Budget, 2002). All the modifications passed in April, 2002 are already incorporated in this analytical note.

2. We have tried to explain some of the provisions by giving illustrations and computations. Notes in the margin are summaries for the whole paragraphs.

This note is mainly for the businessmen who are exposed to the Indian Income Tax Act.

Some paragraphs are meant for professionals and discussed in little more details. Such paragraphs are marked (P). Corporate executives may be interested in these.

Budget contains several provisions. A reader may not be interested in all the provisions. Hence we have grouped the paragraphs in the following parts :

PART A : Tax rates, personal income & deductions - Like salaries, house property income, LIC deduction etc.

PART B  : Corporate/Business matters - Like Transfer Pricing, export reliefs etc.


PART D  : Economy and Philosophy, Indian Budget & Myths.


Finance Minister has faced very tough times.

1. Indo-Pak war danger remains. In any case, a huge expenditure of ‘military on border’ is continuing.

2. Even otherwise, continuing increase in expenses is a matter of fact.

3. Government is already insolvent.

4. Direct tax rates are at their historically lowest. There is no scope for further reductions.

In such a situation, making low deficit budget which is good for economy; and yet pleases the people is most difficult. Hence Finance Minister has not attempted such a budget.

Indian Budget. Economy & Philosophy 2002

[ Full book in PDF Format ]


Sr. No.   Particulars  
Part A  — Tax rates, personal income & deductions [ PDF Format ]
  1. Tax rates  
  2. Rebate for PPF, LIC, etc.  
  3. House Property Income  
  4. Tax to be deducted at source by individuals & HUFs  
Part B  — Corporate/Business matters [ PDF Format ]
  5. Tax on dividend  
  6. Non-residents and foreign companies  
  7. Sale of immovable property  
  8. Transfer Pricing  
  9. Restrictive covenants  
  10. Export oriented units etc.  
  11. Tax on perquisites provided to employees  
  12. Additional depreciation  
  13. Capital Losses  
Part C  — NRIs & Bank Accounts [ PDF Format ]
Part D  — Economy and Philosophy [ PDF Format ]
    Indian Budget & Myths