Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: list of goods taxed at 4% :: Central Excise rule to resale the machines to a new company :: TDS :: TAX RATES - GOODS TAXABLE @ 4% :: empanelment :: ACCOUNTING STANDARDS :: VAT RATES :: due date for vat payment :: ACCOUNTING STANDARD :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ARTICLES ON INPUT TAX CREDIT IN VAT :: form 3cd :: cpt :: articles on VAT and GST in India :: VAT Audit
 
 
Various Acts & Rules »
 Customs Tariff 2009-10 - PART-II - Chapter 98 - Project imports, Laboratory chemicals, passenger's baggage
 Customs Tariff 2009-10 - PART-II - Chapter 97 - Works of art, collectors' pieces and antiques
 Customs Tariff 2009-10 - PART-II - Chapter 96 - Miscellaneous manufactured articles
 Customs Tariff 2009-10 - PART-II - Chapter 95 - Toys, games and sports requisites; parts and accessories thereof
 Customs Tariff 2009-10 - PART-II - Chapter 94 - Furniture; bedding, mattresses, mattress supports
 Customs Tariff 2009-10 - PART-II - Chapter 93 - Arms and ammunition; parts and accessories thereof
 Customs Tariff 2009-10 - PART-II - Chapter 92 - Musical instruments; parts and accessories of such articles
 Customs Tariff 2009-10 - PART-II - Chapter 91 - Clocks and watches and parts thereof
 Customs Tariff 2009-10 - PART-II - Chapter 90 - Optical, photographic, cinematographic, measuring
 Customs Tariff 2009-10 - PART-II - Chapter 89 - Ships, boats and floating structures
 Customs Tariff 2009-10 - PART-II - Chapter 88 - Aircraft, spacecraft, and parts thereof

Income-Tax Act - Section No. 35D
August, 09th 2010

69[Amortisation of certain preliminary expenses.

7035D. (1) Where an assessee, being an Indian company or a person (other than a company) who is resident in India, incurs, after the 31st day of March, 1970, any expenditure specified in sub-section (2),

           (i)  before the commencement of his business, or

          (ii)  after the commencement of his business, in connection with the extension of his 71[***] undertaking or in connection with his setting up a new 71[***] unit,

the assessee shall, in accordance with and subject to the provisions of this section, be allowed a deduction of an amount equal to one-tenth of such expenditure for each of the ten successive previous years beginning with the previous year in which the business commences or, as the case may be, the previous year in which the extension of the 71[***] undertaking is completed or the new 71[***] unit commences production or operation :

72[Provided that where an assessee incurs after the 31st day of March, 1998, any expenditure specified in sub-section (2), the provisions of this sub-section shall have effect as if for the words an amount equal to one-tenth of such expenditure for each of the ten successive previous years, the words an amount equal to one-fifth of such expenditure for each of the five successive previous years had been substituted.]

(2) The expenditure referred to in sub-section (1) shall be the expenditure specified in any one or more of the following clauses, namely :

          (a)  expenditure in connection with

       (i)  preparation of feasibility report;

      (ii)  preparation of project report;

     (iii)  conducting market survey or any other survey necessary for the business of the assessee;

     (iv)  engineering services relating to the business of the assessee :

                Provided that the work in connection with the preparation of the feasibility report or the project report or the conducting of market survey or of any other survey or the engineering services referred to in this clause is carried out by the assessee himself or by a concern which is for the time being approved73 in this behalf by the Board;

          (b)  legal charges for drafting any agreement between the assessee and any other person for any purpose relating to the setting up or conduct of the business of the assessee;

          (c)  where the assessee is a company, also expenditure

       (i)  by way of legal charges for drafting the Memorandum and Articles of Association of the company;

      (ii)  on printing of the Memorandum and Articles of Association;

     (iii)  by way of fees for registering the company under the provisions of the Companies Act, 1956 (1 of 1956);

     (iv)  in connection with the issue, for public subscription, of shares in or debentures of the company, being underwriting commission, brokerage and charges for drafting, typing, printing and advertisement of the prospectus;

          (d)  such other items of expenditure (not being expenditure eligible for any allowance or deduction under any other provision of this Act) as may be prescribed.

(3) Where the aggregate amount of the expenditure referred to in sub-section (2) exceeds an amount calculated at two and one-half per cent

          (a)  of the cost of the project, or

          (b)  where the assessee is an Indian company, at the option of the company, of the capital employed in the business of the company,

the excess shall be ignored for the purpose of computing the deduction allowable under sub-section (1) :

74[Provided that where the aggregate amount of expenditure referred to in sub-section (2) is incurred after the 31st day of March, 1998, the provisions of this sub-section shall have effect as if for the words two and one-half per cent, the words five per cent had been substituted.]

Explanation.In this sub-section

          (a)  cost of the project means

       (i)  in a case referred to in clause (i) of sub-section (1), the actual cost of the fixed assets, being land, buildings, leaseholds, plant, machinery, furniture, fittings and railway sidings (including expenditure on development of land and buildings), which are shown in the books of the assessee as on the last day of the previous year in which the business of the assessee commences;

      (ii)  in a case referred to in clause (ii) of sub-section (1), the actual cost of the fixed assets, being land, buildings, leaseholds, plant, machinery, furniture, fittings and railway sidings (including expenditure on development of land and buildings), which are shown in the books of the assessee as on the last day of the previous year in which the extension of the 75[***] undertaking is completed or, as the case may be, the new 75[***] unit commences production or operation, in so far as such fixed assets have been acquired or developed in connection with the extension of the 75[***] undertaking or the setting up of the new 75[***] unit of the assessee;

          (b)  capital employed in the business of the company means

       (i)  in a case referred to in clause (i) of sub-section (1), the aggregate of the issued share capital, debentures and long-term borrowings as on the last day of the previous year in which the business of the company commences;

      (ii)  in a case referred to in clause (ii) of sub-section (1), the aggregate of the issued share capital, debentures and long-term borrowings as on the last day of the previous year in which the extension of the 76[***] undertaking is completed or, as the case may be, the new 76[***] unit commences production or operation, in so far as such capital, debentures and long-term borrowings have been issued or obtained in connection with the extension of the 76[***] undertaking or the setting up of the new 76[***] unit of the company;

          (c)  long-term borrowings means

       (i)  any moneys borrowed by the company from Government or the Industrial Finance Corporation of India or the Industrial Credit and Investment Corporation of India or any other financial institution 77[which is eligible for deduction under clause (viii) of sub-section (1) of section 36] or any banking institution (not being a financial institution referred to above), or

      (ii)  any moneys borrowed or debt incurred by it in a foreign country in respect of the purchase outside India of capital plant and machinery, where the terms under which such moneys are borrowed or the debt is incurred provide for the repayment thereof during a period of not less than seven years.

(4) Where the assessee is a person other than a company or a co-operative society, no deduction shall be admissible under sub-section (1) unless the accounts of the assessee for the year or years in which the expenditure specified in sub-section (2) is incurred 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 for the first year in which the deduction under this section is claimed, the report of such audit in the prescribed form78 duly signed and verified by such accountant and setting forth such particulars as may be prescribed.

(5) Where the undertaking of an Indian company which is entitled to the deduction under sub-section (1) is transferred, before the expiry of the period of ten years specified in sub-section (1), to another Indian company in a scheme of amalgamation,

           (i)  no deduction shall be admissible under sub-section (1) in the case of the amalgamating company for the previous year in which the amalgamation takes place; and

          (ii)  the provisions of this section shall, as far as may be, apply to the amalgamated company as they would have applied to the amalga-mating company if the amalgamation had not taken place.

79[(5A) Where the undertaking of an Indian company which is entitled to the deduction under sub-section (1) is transferred, before the expiry of the period specified in sub-section (1), to another company in a scheme of demerger,

           (i)  no deduction shall be admissible under sub-section (1) in the case of the demerged company for the previous year in which the demerger takes place; and

          (ii)  the provisions of this section shall, as far as may be, apply to the resulting company, as they would have applied to the demerged company, if the demerger had not taken place.]

(6) Where a deduction under this section is claimed and allowed for any assessment year in respect of any expenditure specified in sub-section (2), the expenditure in respect of which deduction is so allowed shall not qualify for deduction under any other provision of this Act for the same or any other assessment year.]

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Website Ranking Website Ranking Company Website Positioning Alexa Ranking Website Promotion Website top 10 ranking website top 10 promotion search engine result promotion Strategic Internet Marketing Website Optimization Website Ranking Factors

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions