Amendment of section 80-IBA.
26. In section 80-IBA of the Income-tax Act, with effect from the 1st day of April, 2022,––
(a) after sub-section (1) , the following sub-section shall be inserted, namely:––
“(1A) Where the gross total income of an assessee includes any profits and gains derived from the business of developing and building rental housing project, there shall be allowed a deduction of an amount equal to hundred per cent. of the profits and gains derived from such business.”;
(b) in sub-section (2), in clause (a), for the figures “2021”, the figures “2022”shall be substituted;
(c) in sub-section (6), after clause (d), the following clause shall be inserted, namely:––
‘(da) “rental housing project” means a project which is notified by the Central Government in the Official Gazette under this clause on or before the 31st day of March, 2022 and fulfils such conditions as may be specified in the said notification;’.
Notes on Clauses:
Clause 26 of the Bill seeks to amend section 80-IBA of the Income-tax Act relating to deductions in respect of profits and gains from housing project.
The provisions of sub-section (1) of the said section provides for hundred per cent. deductions of the profits and gains derived from the business of developing and building affordable housing project subject to certain conditions. Further the provisions of clause (a) of sub-section (2) of said section provide that the housing project shall be approved by the competent authority after 1st June, 2016 but on or before 31st March, 2021.
It is proposed to insert sub-section (1A) in the said section so as to provide for hundred per cent. deductions of the profits and gains derived from the business of developing and building affordable rental housing project.
It is further proposed to amend clause (a) of sub-section (2) so as to allow the deduction in respect of profits and gains derived from the business of developing and building housing project for hundred per cent. of the profits and gains derived from the business of developing and building such project approved by the competent authority after 1st day of June, 2016 but on or before 31st March, 2022.
It is also proposed to insert a new clause (da) in sub-clause (6) to define the expression “rental housing project”.
These amendments will take effect from 1st April, 2022 and will, accordingly, apply in relation to the assessment year 2022-2023 and subsequent assessment years
