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Home Acts & Rules Bill Bills FINANCE BILL, 2020 Chapters List Chapter III DIRECT TAXES - Income-tax This
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Clause 30 - Amendment of section 57. - FINANCE BILL, 2020

FINANCE BILL, 2020
Chapter III
DIRECT TAXES - Income-tax
  • Contents
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Amendment of section 57.

30. In section 57 of the Income-tax Act, with effect from the 1st day of April, 2021,––

(a) in clause (i), for the words, figures and letter “dividends, other than dividends referred to in section 115-O”, the word “dividends” shall be substituted;

(b) the following proviso shall be inserted, namely:––

“Provided that no deduction shall be allowed from the dividend income, or income in respect of units of a Mutual Fund specified under clause (23D) of section 10 or income in respect of units from a specified company defined in the Explanation to clause (35) of section 10, other than deduction on account of interest expense, and in any previous year such deduction shall not exceed twenty per cent. of the dividend income, or income in respect of such units, included in the total income for that year, without deduction under this section.”.

 



 

Notes on Clauses:

Clause 30 of the Bill seeks to amend section 57 of the Income-tax Act relating to deductions.

Clause (i) of the said section allows deduction of any reasonable sum for the purpose of realising such dividend except the dividend referred to in section 115-O. It is proposed to omit the reference of dividend referred to in section 115-O.

It is further proposed to insert a proviso to the said section so as to provide that no deduction shall be allowed from the dividend income, or income in respect of units of a Mutual Fund specified under clause (23D) of section 10 or income in respect of units from a specified company defined in the Explanation to clause (35) of section 10, other than deduction on account of interest expense and in any previous year such deduction shall not exceed twenty per cent. of the dividend income, or income in respect of such units, included in the total income for that year without deduction under that section.

These amendments will take effect from 1st April, 2021 and will, accordingly, apply in relation to the assessment year 2021-2022 and subsequent assessment years.

 
 
 
 
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