TMI BlogOther deductionsX X X X Extracts X X X X X X X X Extracts X X X X ..... ) and approved by the Central Government; or (B) any other insurer and approved by the Insurance Regulatory and Development Authority established under sub-section (1) of section 3 of the Insurance Regulatory and Development Authority Act, 1999 (41 of 1999); ] (ii) any sum paid to an employee as bonus or commission for services rendered, where such sum would not have been payable to him as profits or dividend if it had not been paid as bonus or commission; 4 [ * * * ] 5 [ * * * ] (iia) 6 [***] (iii) the amount of the interest paid in respect of capital borrowed for the purposes of the business or profession : 7 [Provided that any amount of the interest paid, in respect of capital borrowed for acquisition of an asset 72 [***] (whether capitalised in the books of account or not); for any period beginning from the date on which the capital was borrowed for acquisition of the asset till the date on which such asset was first put to use, shall not be allowed as deduction. ] Explanation .- Recurring subscriptions paid periodically by shareholders, or subscribers in Mutual Benefit Societies which fulfil such conditions as may be prescribed, shall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the due date. 79 [Explanation 1] .-For the purposes of this clause, due date means the date by which the assessee is required as an employer to credit an employee's contribution to the employee's account in the relevant fund under any Act, rule, order or notification issued thereunder or under any standing order, award, contract of service or otherwise ;] 80 [Explanation 2. For the removal of doubts, it is hereby clarified that the provisions of section 43B shall not apply and shall be deemed never to have been applied for the purposes of determining the due date under this clause; ] (vi) in respect of animals which have been used for the purposes of the business or profession otherwise than as stock-in-trade and have died or become permanently useless for such purposes, the difference between the actual cost to the assessee of the animals and the amount, if any, realised in respect of the carcasses or animals; (vii) subject to the provisions of sub-section (2), the amount of 11 [ any bad debt or part thereof which is written off as irrecoverable in the accounts of the assessee for the previous year ]: 12 [Provided that in the case of 13 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ank or a non-scheduled bank referred to in this sub-clause shall, at its option, be allowed in any of the relevant assessment years, deduction in respect of any provision made by it for any assets classified by the Reserve Bank of India as doubtful assets or loss assets in accordance with the guidelines issued by it in this behalf, for an amount not exceeding five per cent of the amount of such assets shown in the books of account of the bank on the last day of the previous year: ] 22 [Provided further that for the relevant assessment years commencing on or after the 1st day of April, 2003 and ending before the 1st day of April, 2005, the provisions of the first proviso shall have effect as if for the words five per cent , the words ten per cent had been substituted : ] 23 [Provided also that a scheduled bank or a non-scheduled bank referred to in this sub-clause shall, at its option, be allowed a further deduction in excess of the limits specified in the foregoing provisions, for an amount not exceeding the income derived from redemption of securities in accordance with a scheme framed by the Central Government: Provided also that no deduction shall be allowe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onstituted under the State Bank of India Act, 1955 (23 of 1955), a subsidiary bank as defined in the State Bank of India (Subsidiary Banks) Act, 1959 (38 of 1959), a corresponding new bank constituted under section 3 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 (5 of 1970), or under section 3 of the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (40 of 1980), or any other bank being a bank included in the Second Schedule to the Reserve Bank of India Act, 1934 (2 of 1934) 31 [ *** ] ; ] 32 [ (iii) public financial institution shall have the meaning assigned to it in section 4A of the Companies Act, 1956 (1 of 1956); (iv) State financial corporation means a financial corporation established under section 3 or section 3A or an institution notified under section 46 of the State Financial Corporations Act, 1951 (63 of 1951); (v) State industrial investment corporation means a Government company within the meaning of section 617 of the Companies Act, 1956 (1 of 1956), engaged in the business of providing long-term finance for industrial projects and 33 [ eligible for deduction under clause (viii) of this sub-s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Banking Regulation Act, 1949 (10 of 1949) applies and includes any bank or banking institution referred to in section 51 of that Act; (d) co-operative bank , primary agricultural credit society and primary co-operative agricultural and rural development bank shall have the meanings respectively assigned to them in the Explanation to sub-section (4) of section 80P; (e) housing finance company means a public company formed or registered in India with the main object of carrying on the business of providing long-term finance for construction or purchase of houses in India for residential purposes; (f) public company shall have the meaning assigned to it in section 3 of the Companies Act, 1956(1 of 1956) ; (g) infrastructure facility means- (i) an infrastructure facility as defined in the Explanation to clause (i) of sub-section (4) of section 80-IA, or any other public facility of a similar nature as may be notified by the Board in this behalf in the Official Gazette and which fulfils the conditions as may be prescribed; (ii) an undertaking referred to in clause (ii) or clause (iii) or clause (iv) or clause (vi) of sub-section (4) of section 80-IA; and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... use,- (a) computer system means a device or collection of devices including input and output support devices and excluding calculators which are not programmable and capable of being used in conjunction with external files, or more of which contain computer programmes, electronic instructions, input data and output data, that performs functions including, but not limited to, logic, arithmetic, data storage and retrieval, communication and control; (b) Y2K compliant computer system means a computer system capable of correctly processing, providing or receiving data relating to date within and between the twentieth and twenty-first century ;] 54 [ (xii) any expenditure (not being in the nature of capital expenditure) incurred by a corporation or a body corporate, by whatever name called, if,- (a) it is constituted or established by a Central, State or Provincial Act; (b) such corporation or body corporate, having regard to the objects and purposes of the Act referred to in sub-clause (a), is notified by the Central Government in the Official Gazette for the purposes of this clause; and (c) the expenditure is incurred for the objects and purposes authorised by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cted loss as computed in accordance with the income computation and disclosure standards notified under sub-section (2) of section 145.] (2) In making any deduction for a bad debt or part thereof, the following provisions shall apply- 56 [ (i) no such deduction shall be allowed unless such debt or part thereof has been taken into account in computing the income of the assessee of the previous year in which the amount of such debt or part thereof is written off or of an earlier previous year, or represents money lent in the ordinary course of the business of banking or money-lending which is carried on by the assessee ;] (ii) if the amount ultimately recovered on any such debt or part of debt is less than the difference between the debt or part and the amount so deducted, the deficiency shall be deductible in the previous year in which the ultimate recovery is made; (iii) any such debt or part of debt may be deducted if it has already been written off as irrecoverable in the accounts of an earlier previous year 57 [ (being a previous year relevant to the assessment year commencing on the 1st day of April, 1988, or any earlier assessment year) ], but the 58 [ A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4-2000. Prior to its omission, clause (iia), as inserted by the Finance (No. 2) Act, 1980, w.e.f. 1-4-1981 and later on amended by the Finance Act, 1984, w.e.f. 1-4-1984 and the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988, read as under : '(iia) a sum equal to one and one-third times the amount of the expenditure incurred on payment of any salary for any period of employment before the 1st day of March, 1984 to an employee who, as at the end of the previous year,- (a) is totally blind, or (b) is subject to or suffers from a permanent physical disability (other than blindness) which has the effect of reducing substantially his capacity to engage in a gainful employment or occupation : Provided that the assessee produces before the Assessing Officer, in respect of the first assessment year for which deduction is claimed in relation to each such employee under this clause,- (i) in a case referred to in sub-clause (a), a certificate as to his total blindness from a registered medical practitioner being an oculist; and (ii) in a case referred to in sub-clause (b), a certificate as to the permanent physical disability referred to in the said sub-clause ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1999, w.e.f. 1-4-2000. 22. Inserted by the Finance Act, 2002, w.e.f. 1-4-2003. 23. Inserted by the Finance Act, 2003, w.e.f. 1-4-2004. 24. Inserted by the Finance Act, 1999, w.e.f. 1-4-2000. 25. Inserted by the Finance (No. 2) Act, 1991, w.e.f. 1-4-1992. 26. Inserted by the Finance Act, 2002, w.e.f. 1-4-2003. 27. Inserted by the Finance Act, 1982, w.e.f. 1-4-1983. 28. Relettered by the Finance Act, 1982, w.e.f. 1-4-1983. 29. Inserted by the Finance Act, 1982, w.e.f. 1-4-1983. 30. Substituted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989. Earlier it was amended by the Finance Act, 1985, w.e.f. 1-4-1985. 31. Words , but does not include a co-operative bank omitted by the Finance Act, 2007, w.e.f. 1-4-2007. 32. Inserted by the Finance (No. 2) Act, 1991, w.e.f. 1-4-1992. 33. Substituted for approved by the Central Government under clause (viii) of this sub-section by the Finance Act, 2000, w.e.f. 1-4-2000. 34. Inserted by the Finance Act, 2007, w.e.f. 1-4-2007. 35. Operative part of this clause was amended by the Finance Act, 1966, w.e.f. 1-4-1966, Finance (No. 2) Act, 1967, w.e.f. 1-4-1968, F ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f section 10;' 46. Inserted by the Finance (No. 2) Act, 1996, w.r.e.f. 1-4-1996. 47. Omitted by the Finance Act, 1994, w.e.f. 1-4-1995. Prior to its omission, clause (viiia), as inserted by the Finance Act, 1982, w.e.f. 1-4-1983 and later on amended by the Finance Act, 1985, w.e.f. 1-4-1985, read as under: '(viiia) in respect of any special reserve created by a scheduled bank (other than a bank incorporated by or under the laws of a country outside India) which is engaged in banking operations outside India, an amount not exceeding forty per cent of the total income (computed before making any deduction under this clause and Chapter VI-A) carried to such reserve account : Provided that, having regard to its capital structure, the extent of its banking operations outside India, its need for resources for such operations outside India and other relevant factors, the bank is, for the time being, approved by the Central Government for the purposes of this clause. Explanation .-For the purposes of this clause, scheduled bank has the same meaning as in clause (ii) of the Explanation to clause (viia);' 48. Inserted by the Finance Act, 1965, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .f. 1-4-2009 63. Omitted vide Finance (No. 2) Act, 2009 with effect from 1-4-2009, earlier it wasInserted by the Finance Act, 2008, w.e.f. 1-4-2009 as, [(xvi) an amount equal to the commodities transaction tax paid by the assessee in respect of the taxable commodities transactions entered into in the course of his business during the previous year, if the income arising from such taxable commodities transactions is included in the income computed under the head Profits and gains of business or profession . Explanation .-For the purposes of this clause, the expressions commodities transaction tax and taxable commodities transaction shall have the meanings respectively assigned to them under Chapter VII of the Finance Act, 2008.] 64. Inserted by the Finance Act, 2007, w.e.f. 1-4-2008. 65. Clause ( viii ) substituted by the Finance Act, 2007, w.e.f. 1-4-2008. Prior to substitution it was read as under: ( viii ) 35 [ in respect of any special reserve created 36 [ and maintained ] by a financial corporation which is engaged in providing long-term finance for 37 [industrial or agricultural development or development of infrastructure facilit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for industrial or agricultural development or development of infrastructure facility in India or construction or purchase of houses in India for residential purposes; 68 . Inserted vide Finance Act, 2011 w.e.f. 1.4.2012 69. Renumbered as Explanation 1 , before it was read as, Explanation vide Finance Act 2013, w.e.f. 1.4.2014 70. Inserted vide Finance Act 2013, w.e.f. 1.4.2014 71. Inserted vide Finance Act 2013, w.e.f. 1.4.2014 72. Omitted vide THE FINANCE ACT, 2015 w.e.f. 1st day of April, 2016, before it was read as, for extension of existing business or profession 73. Inserted vide THE FINANCE ACT, 2015 w.e.f. 1st day of April, 2016 74. Inserted vide THE FINANCE ACT, 2015 w.e.f. 1st day of April, 2016 75. Inserted vide THE FINANCE ACT, 2016 w.e.f. 1st day of April, 2017 76. Inserted vide THE FINANCE ACT, 2016 w.e.f. 1st day of April, 2017 77.Substituted vide THE FINANCE ACT, 2017 w.e.f. 1st day of April, 2018 before it was read as seven and one-half per cent. 78. Inserted vide THE FINANCE ACT, 2018 w.e.f. 1st day of April, 2017 79. Numbered vide THE FINANCE ACT, 2021 dated 28-03-2021 w.e.f. 0 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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