Income Tax Act

INCOME TAX ACT

Table of contents
Preamble
Section 1
Section 2
Section 3
Section 4
Section 5
Section 5A
Section 6
Section 7
Section 8
Section 9
Section 10
Section 10A
Section 10B
Section 10C
Section 11
Section 12
Section 12A
Section 12AA
Section 13
Section 13A
Section 14
Section 15
Section 16
Section 17
Section 18
Section 19
Section 20
Section 21
Section 22
Section 23
Section 24
Section 25
Section 25A
Section 26 / Section 27
Section 28
Section 29
Section 30
Section 31
Section 32
Section 32A
Section 32AB
Section 33
Section 33A
Section 33AB
Section 33ABA
Section 33AC
Section 33B
Section 34
Section 34A
Section 35
Section 35A
Section 35AB
Section 35ABB
Section 35AC
Section 35B
Section 35C
Section 35CC
Section 35CCA
Section 35CCB
Section 35D
Section 35DD
Section 35E
Section 36
Section 37
Section 38
Section 39
Section 40
Section 40A / Section 41
Section 42
Section 43
Section 43A
Section 43B
Section 43C
Section 43D
Section 44
Section 44A
Section 44AA
Section 44AB
Section 44AC
Section 44AD
Section 44AE
Section 44AF
Section 44B
Section 44BB
Section 44BBA
Section 44BBB
Section 44C
Section 44D
Section 45
Section 46
Section 46A
Section 47
Section 47A
Section 48
Section 49
Section 50
Section 50A
Section 50B
Section 51
Section 52
Section 53
Section 54 / Section 54A
Section 54B
Section 54C
Section 54D
Section 54E
Section 54EA
Section 54EB
Section 54F
Section 54G
Section 54H
Section 55
Section 55A
Section 56
Section 57
Section 58
Section 59
Section 60
Section 61
Section 62
Section 63
Section 64
Section 65
Section 66
Section 67
Section 67A
Section 68
Section 69
Section 69A
Section 69B
Section 69C
Section 69D
Section 70
Section 71
Section 71A
Section 71B
Section 72
Section 72A
Section 73
Section 74
Section 74A
Section 75
Section 78
Section 79
Section 80
Section 80A
Section 80AA
Section 80AB
Section 80B
Section 80C
Section 80CC
Section 80CCA
Section 80CCB
Section 80CCC
Section 80D
Section 80DD
Section 80DDB
Section 80E
Section 80F
Section 80G
Section 80GG
Section 80GGA
Section 80H
Section 80HH
Section 80HHA
Section 80HHB
Section 80HHBA
Section 80HHC
Section 80HHD
Section 80HHE
Section 80HHF
Section 80I
Section 80IA
Section 80IB / Section 80J
Section 80JJ
Section 80JJA
Section 80JJAA
Section 80K
Section 80L
Section 80M
Section 80MM
Section 80N
Section 80O
Section 80P
Section 80Q
Section 80QQ
Section 80QQA
Section 80R
Section 80RR
Section 80RRA
Section 80S
Section 80T
Section 80TT
Section 80U
Section 80V
Section 80W
Section 80VVA
Section 81
Section 82
Section 83
Section 84
Section 85
Section 85A
Section 85B
Section 85C
Section 86
Section 86A
Section 87
Section 88
Section 88A
Section 88B / Section 89
Section 89A
Section 90
Section 91
Section 92
Section 93
Section 94
Section 95
Section 96
Section 97
Section 98
Section 99
Section 100
Section 101
Section 102
Section 103
Section 104
Section 105
Section 106
Section 107
Section 107A
Section 108
Section 109
Section 110
Section 111
Section 112
Section 112A
Section 113
Section 114
Section 115
Section 115A
Section 115AB
Section 115AC
Section 115ACA
Section 115AD
Section 115B
Section 115BB
Section 115BBA / Section 115C
Section 115D
Section 115E
Section 115F
Section 115G
Section 115H
Section 115I
Section 115J
Section 115JA
Section 115JAA
Section 115K
Section 115L
Section 115M
Section 115N
Section 115O
Section 115P
Section 115Q
Section 115R
Section 115S
Section 115T
Section 116
Section 117
Section 118
Section 119
Section 120
Section 121
Section 121A
Section 122
Section 123
Section 124
Section 125
Section 125A
Section 126
Section 127
Section 128
Section 129
Section 130
Section 130A
Section 131
Section 132
Section 132A
Section 132B
Section 133
Section 133A
Section 133B
Section 134
Section 135
Section 136
Section 137
Section 138
Section 139
Section 139A
Section 140
Section 140A
Section 141
Section 141A
Section 142
Section 143
Section 144
Section 144A
Section 144B
Section 145
Section 145A
Section 146
Section 147
Section 148
Section 149
Section 150
Section 151
Section 152
Section 153
Section 154
Section 155
Section 156
Section 157
Section 158 / Section 158A
Section 158B
Section 158BA
Section 158BB
Section 158BC
Section 158BD
Section 158BE
Section 158BF
Section 158BFA
Section 158BG
Section 158BH
Section 159
Section 160
Section 161
Section 162
Section 163
Section 164
Section 164A
Section 165
Section 166
Section 167
Section 167A
Section 167B
Section 168
Section 169
Section 170
Section 171
Section 172
Section 173
Section 174
Section 175
Section 176
Section 177
Section 178
Section 179
Section 180
Section 180A
Section 181 / Section 182
Section 183
Section 184
Section 185
Section 187
Section 188
Section 188A
Section 189
Section 189A
Section 190
Section 191
Section 192
Section 193
Section 194
Section 194A
Section 194B
Section 194BB
Section 194C
Section 194D
Section 194E
Section 194EE
Section 194F
Section 194G
Section 194H
Section 194I
Section 194J
Section 194K
Section 194L
Section 195
Section 195A
Section 196
Section 196A
Section 196B
Section 196C
Section 196D
Section 197
Section 197A
Section 198 / Section 199
Section 200
Section 201
Section 202
Section 203
Section 203A
Section 204
Section 205
Section 206
Section 206A
Section 206B
Section 206C
Section 207
Section 208
Section 209
Section 209A
Section 210
Section 211
Section 212
Section 213
Section 214
Section 215
Section 216
Section 217
Section 218
Section 219
Section 220
Section 221
Section 222
Section 223
Section 224
Section 225
Section 226
Section 227
Section 228
Section 228A
Section 229
Section 230
Section 230A
Section 231
Section 232
Section 233
Section 234
Section 234A
Section 234B
Section 234C
Section 235
Section 236
Section 236A
Section 237
Section 238
Section 239
Section 240
Section 241
Section 242
Section 243
Section 244
Section 244A
Section 245
Section 245A
Section 245B
Section 245BA
Section 245BB
Section 245BC
Section 245BD
Section 245C
Section 245D
Section 245DD
Section 245E
Section 245F
Section 245G
Section 245H
Section 245HA
Section 245I
Section 245J
Section 245K / Section 245L
Section 245M
Section 245N
Section 245O
Section 245P
Section 245Q
Section 245R
Section 245RR
Section 245S
Section 245T
Section 245U
Section 245V
Section 246
Section 246A
Section 247
Section 248
Section 249
Section 250
Section 251
Section 252
Section 253
Section 254
Section 255
Section 256
Section 257
Section 258
Section 259
Section 260
Section 260A
Section 260B
Section 261
Section 262
Section 263
Section 264
Section 265
Section 266
Section 267
Section 268 / Section 269
Section 269A
Section 269AB
Section 269B
Section 269C
Section 269D
Section 269E
Section 269F
Section 269G
Section 269H
Section 269I
Section 269J
Section 269K
Section 269L
Section 269M
Section 269N
Section 269O
Section 269P
Section 269Q
Section 269R
Section 269RR
Section 269S
Section 269SS
Section 269T
Section 269TT
Section 269U
Section 269UA
Section 269UB
Section 269UC
Section 269UD
Section 269UE
Section 269UF
Section 269UG
Section 269UH
Section 269UI
Section 269UJ
Section 269UK
Section 269UL / Section 269UM
Section 269UN
Section 269UO
Section 270
Section 271
Section 271A
Section 271B
Section 271BB
Section 271C
Section 271D
Section 271E
Section 271F
Section 272
Section 272A
Section 272AA
Section 272B
Section 272BB
Section 273
Section 273A
Section 273B
Section 274
Section 275
Section 275A
Section 276
Section 276A
Section 276AA
Section 276AB
Section 276B
Section 276BB
Section 276C
Section 276CC
Section 276CCC
Section 276D
Section 276DD
Section 276E
Section 277
Section 278
Section 278A
Section 278AA
Section 278B
Section 278C
Section 278D
Section 278E
Section 279
Section 279A
Section 279B
Section 280
Section 280A
Section 280B
Section 280C
Section 280D
Section 280E
Section 280F
Section 280G
Section 280H
Section 280I / Section 280J
Section 280K
Section 280L
Section 280M
Section 280N
Section 280O
Section 280P
Section 280Q
Section 280R
Section 280S
Section 280T
Section 280U
Section 280V
Section 280W
Section 280X
Section 280Y
Section 280Z
Section 280ZA / Section 280ZB
Section 280ZC
Section 280ZD
Section 280ZE
Section 281
Section 281A
Section 281B Section 282
Section 283
Section 284
Section 285
Section 285A
Section 285B
Section 286
Section 287
Section 287A
Section 288
Section 288A / Section 288B
Section 289
Section 290
Section 291
Section 292
Section 292A
Section 292B
Section 293
Section 293A
Section 293B
Section 294
Section 294A
Section 295
Section 296
Section 297
Section 298

TABLE OF CONTENTS

CHAPTER I - PRELIMINARY

1. SHORT TITLE, EXTENT AND COMMENCEMENT

2. DEFINITIONS

3. PREVIOUS YEAR” DEFINED

CHAPTER II - BASIS OF CHARGE

4. CHARGE OF INCOME-TAX

5. SCOPE OF TOTAL INCOME

5A. APPORTIONMENT OF INCOME BETWEEN SPOUSES GOVERNED BY PORTUGUESE CIVIL CODE

6. RESIDENCE IN INDIA

7. INCOME DEEMED TO BE RECEIVED

8. DIVIDEND INCOME

9. INCOME DEEMED TO ACCRUE OR ARISE IN INDIA

CHAPTER III - INCOMES WHICH DO NOT FORM PART OF TOTAL INCOME

10. INCOMES NOT INCLUDED IN TOTAL INCOME

10A. SPECIAL PROVISION IN RESPECT OF NEWLY ESTABLISHED INDUSTRIAL UNDERTAKINGS IN FREE TRADE ZONES

10B. SPECIAL PROVISION IN RESPECT OF NEWLY ESTABLISHED 100 PERCENT EXPORT-ORIENTED UNDERTAKINGS

10C SPECIAL PROVISION IN RESPECT OF CERTAIN INDUSTRIAL UNDERTAKINGS IN NORTH-EASTERN REGION

11. INCOME FROM PROPERTY HELD FOR CHARITABLE OR RELIGIOUS PURPOSES

12. INCOME OF TRUSTS OR INSTITUTIONS FROM CONTRIBUTIONS

12A. CONDITIONS AS TO REGISTRATION OF TRUSTS, ETC.

12AA. PROCEDURE FOR REGISTRATION

13. SECTION 11 NOT TO APPLY IN CERTAIN CASES

13A. SPECIAL PROVISION RELATING TO INCOMES OF POLITICAL PARTIES

CHAPTER IV - COMPUTATION OF TOTAL INCOME HEADS OF INCOME

14. HEADS OF INCOME

A — SALARIES

15. SALARIES

16. DEDUCTIONS FROM SALARIES

17. “SALARY”, “PERQUISITE” AND “PROFITS IN LIEU OF SALARY” DEFINED

B — [OMITTED]

18. [OMITTED BY THE FINANCE ACT, 1988 W.E.F. 1-4-1989]

19. [OMITTED BY THE FINANCE ACT, 1988 W.E.F. 1-4-1989]

20. [OMITTED BY THE FINANCE ACT, 1988 W.E.F. 1-4-1989]

21. [OMITTED BY THE FINANCE ACT, 1988 W.E.F. 1-4-1989]

C - INCOME FROM HOUSE PROPERTY

22. INCOME FROM HOUSE PROPERTY

23. ANNUAL VALUE HOW DETERMINED

24. DEDUCTIONS FROM INCOME FROM HOUSE PROPERTY

25. AMOUNTS NOT DEDUCTIBLE FROM INCOME FROM HOUSE PROPERTY

25A. SPECIAL PROVISION FOR CASES WHERE UNREALISED RENT ALLOWED AS DEDUCTION IS REALISED SUBSEQUENTLY

26. PROPERTY OWNED BY CO-OWNERS

27. "OWNER OF HOUSE PROPERTY", "ANNUAL CHARGE", ETC., DEFINED

D - PROFITS AND GAINS OF BUSINESS OR PROFESSION

28. PROFITS AND GAINS OF BUSINESS OR PROFESSION

29. INCOME FROM PROFITS AND GAINS OF BUSINESS OR PROFESSION, HOW COMPUTED

30. RENT, RATES, TAXES, REPAIRS AND INSURANCE FOR BUILDINGS

31. REPAIRS AND INSURANCE OF MACHINERY, PLANT AND FURNITURE

32. DEPRECIATION

32A. INVESTMENT ALLOWANCE

32AB. INVESTMENT DEPOSIT ACCOUNT

33. DEVELOPMENT REBATE

33A. DEVELOPMENT ALLOWANCE

33AB. TEA DEVELOPMENT ACCOUNT

33ABA. SITE RESTORATION FUND

33AC. RESERVES FOR SHIPPING BUSINESS

33B. REHABILITATION ALLOWANCE

34. CONDITIONS FOR DEPRECIATION ALLOWANCE AND DEVELOPMENT REBATE

34A. RESTRICTION ON UNABSORBED DEPRECIATION AND UNABSORBED INVESTMENT ALLOWANCE FOR LIMITED PERIOD IN CASE OF CERTAIN DOMESTIC COMPANIES

35. EXPENDITURE ON SCIENTIFIC RESEARCH

35A. EXPENDITURE ON ACQUISITION OF PATENT RIGHTS OR COPYRIGHTS

35AB. EXPENDITURE ON KNOW-HOW

35ABB. EXPENDITURE FOR OBTAINING LICENCE TO OPERATE TELECOMMUNICATION SERVICES

35AC. EXPENDITURE ON ELIGIBLE PROJECTS OR SCHEMES

35B. [OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1989]

35C. [OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1989]

35CC. [OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1989]

35CCA. EXPENDITURE BY WAY OF PAYMENT TO ASSOCIATIONS AND INSTITUTIONS FOR CARRYING OUT RURAL DEVELOPMENT PROGRAMMES

35CCB. EXPENDITURE BY WAY OF PAYMENT TO ASSOCIATIONS AND INSTITUTIONS FOR CARRYING OUT PROGRAMMES OF CONSERVATION OF NATURAL RESOURCES

35D. AMORTISATION OF CERTAIN PRELIMINARY EXPENSES

35DD AMORTISATION OF EXPENDITURE IN CASE OF AMALGAMATION OR DOMERGER

35E. DEDUCTION FOR EXPENDITURE ON PROSPECTING, ETC., FOR CERTAIN MINERALS

36. OTHER DEDUCTIONS

37. GENERAL

38. BUILDING, ETC., PARTLY USED FOR BUSINESS, ETC., OR NOT EXCLUSIVELY SO USED

39. [OMITTED BY THE DIRECT TAX LAWS (AMENDMENT) ACT, 1987, W.E.F. 1-4-1989]

40. AMOUNTS NOT DEDUCTIBLE

40A. EXPENSES OR PAYMENTS NOT DEDUCTIBLE IN CERTAIN CIRCUMSTANCES

41. PROFITS CHARGEABLE TO TAX

42. SPECIAL PROVISION FOR DEDUCTIONS IN THE CASE OF BUSINESS FOR PROSPECTING, ETC., FOR MINERAL OIL

43. DEFINITIONS OF CERTAIN TERMS RELEVANT TO INCOME FROM PROFITS AND GAINS OF BUSINESS OR PROFESSION

43A. SPECIAL PROVISIONS CONSEQUENTIAL TO CHANGES IN RATE OF EXCHANGE OF CURRENCY

43B. CERTAIN DEDUCTIONS TO BE ONLY ON ACTUAL PAYMENT

43C. SPECIAL PROVISION FOR COMPUTATION OF COST OF ACQUISITION OF CERTAIN ASSETS

43D. SPECIAL PROVISION IN CASE OF INCOME OF PUBLIC FINANCIAL INSTITUTIONS, ETC.

44. INSURANCE BUSINESS

44A. SPECIAL PROVISION FOR DEDUCTION IN THE CASE OF TRADE, PROFESSIONAL OR SIMILAR ASSOCIATION

44AA. MAINTENANCE OF ACCOUNTS BY CERTAIN PERSONS CARRYING ON PROFESSION OR BUSINESS

44AB. AUDIT OF ACCOUNTS OF CERTAIN PERSONS CARRYING ON BUSINESS OR PROFESSION

44AC. [OMITTED BY THE FINANCE ACT, 1992, W.E.F. 1-4-1993]

44AD. SPECIAL PROVISION FOR COMPUTING PROFITS AND GAINS OF BUSINESS OF CIVIL CONSTRUCTION, ETC.

44AE. SPECIAL PROVISION FOR COMPUTING PROFITS AND GAINS OF BUSINESS OF PLYING, HIRING OR LEASING GOODS CARRIAGES

44AF. SPECIAL PROVISIONS FOR COMPUTING PROFITS AND GAINS OF RETAIL BUSINESS

44B. SPECIAL PROVISION FOR COMPUTING PROFITS AND GAINS OF SHIPPING BUSINESS IN THE CASE OF NON- RESIDENTS

44BB. SPECIAL PROVISION FOR COMPUTING PROFITS AND GAINS IN CONNECTION WITH THE BUSINESS OF EXPLORATION, ETC., OF MINERAL OILS

44BBA. SPECIAL PROVISION FOR COMPUTING PROFITS AND GAINS OF THE BUSINESS OF OPERATION OF AIRCRAFT IN THE CASE OF NON-RESIDENTS

44BBB. SPECIAL PROVISION FOR COMPUTING PROFITS AND GAINS OF FOREIGN COMPANIES, ENGAGED IN THE BUSINESS OF CIVIL CONSTRUCTION, ETC., IN CERTAIN TURNKEY POWER PROJECTS

44C. DEDUCTION OF HEAD OFFICE EXPENDITURE IN THE CASE OF NON-RESIDENTS

44D. SPECIAL PROVISIONS FOR COMPUTING INCOME BY WAY OF ROYALTIES, ETC., IN THE CASE OF FOREIGN COMPANIES

E - CAPITAL GAINS

45. CAPITAL GAINS

46. CAPITAL GAINS ON DISTRIBUTION OF ASSETS BY COMPANIES IN LIQUIDATION

46A CAPITAL GAINS ON PURCHASE BY COMPANY OF ITS OWN SHARE OR OTHER SPECIFIED SECURITIES

47. TRANSACTIONS NOT REGARDED AS TRANSFER

47A. WITHDRAWAL OF EXEMPTION IN CERTAIN CASES

48. MODE OF COMPUTATION

49. COST WITH REFERENCE TO CERTAIN MODES OF ACQUISITION