Amendment of section 35AD.
18. In section 35AD of the Income-tax Act,––
(i) in sub-section (1), for the words “An assessee shall”, the words “An assessee shall, if he opts,” shall be substituted;
(ii) in sub-section (4), after the words “in any other previous year”, the words “, if the deduction has been claimed or opted by the assessee and allowed to him under this section” shall be inserted.
Notes on Clauses:
Clause 18 of the Bill seeks to amend section 35AD of the Income-tax Act relating to deduction in respect of expenditure on specified business.
Sub-section (1) of the said section, inter alia, provides for one hundred per cent. deduction on capital expenditure incurred on any specified business during the previous year in which such expenditure is incurred.
It is proposed to amend said sub-section (1) so as to express the assessee to exercise option of availing such deduction in respect of the capital expenditure incurred in respect of specified business during the previous year in which such capital expenditure is incurred.
Sub-section (4) of the said section, inter alia, provides that the expenditure on which deduction has been allowed under sub-section (1) shall not be allowed as deduction under any other section in any previous year or under this section in any other previous year.
It is proposed to amend the said sub-section (4) so as to provide that no deduction in respect of the expenditure referred to in sub-section (1) shall be allowed to the assessee under any other section in any previous year or under this section in any other previous year, if the deduction has been claimed by the assessee and allowed to him under this section.
These amendments will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-2021 and subsequent assessment years.
