Amendment of section 80-IA.
35. In section 80-IA of the Income-tax Act, in sub-section (7), for the words “and the assessee furnishes, along with his return of income”, the words, figures and letters “before the specified date referred to in section 44AB and the assessee furnishes by that date” shall be substituted.
Notes on Clauses:
Clause 35 of the Bill seeks to amend section 80-IA of the Income-tax Act relating to deductions in respect of profits and gains from industrial undertakings or enterprises engaged in infrastructure development, etc.
Sub-section (1) of the said section provides that where the gross total income of an assessee includes any profits and gains derived by an undertaking or an enterprise from any business referred to in sub-section (4)(such business being referred to as the eligible business), there shall, in accordance with and subject to the provisions of the said section, be allowed, in computing the total income of the assessee, a deduction of an amount equal to hundred per cent. of the profits and gains derived from such business for ten consecutive assessment years.
Sub-section (7) of the said section provides that the deduction under sub-section (1) from profits and gains derived from an undertaking shall not be admissible unless the accounts of the undertaking for the previous year relevant to the assessment year for which the deduction is claimed have been audited by an accountant, as defined in the Explanation below sub-section (2) of section 288 and the assessee furnishes, along with his return of income, the report of such audit in the prescribed form duly signed and verified by such accountant.
It is proposed to amend the said sub-section (7) so as to provide that deduction under sub-section (1) from profits and gains derived from an undertaking shall not be admissible to the assessee unless the accounts of the undertaking for the previous year relevant to the assessment year for which the deduction is claimed have been audited by an accountant as defined in the Explanation below sub-section (2) of section 288 before the specified date referred to in section 44AB (i.e., one month prior to the due date for filing of return under sub-section (1) of section 139) and the report of such audit is furnished by that date.
This amendment will take effect from 1st April, 2020 and will, accordingly, apply in relation to the assessment year 2020-2021 and subsequent assessment years.
