Section 28 - Amendment of section 109 - Taxation Laws (Amendment) Act, 1975

28. Amendment of section 109. In section 109 of the Income-tax Act, - (a) after clause (i), the following clauses shall be inserted, namely: (ia) industrial company means an Indian company whose business consists wholly in the construction of ships or in the manufacture or processing of goods or in mining or in the generation or distribution of electricity or any other form of power; (ib) consultancy service company means an Indian company whose business consists wholly in the provision of technical know-how, or in the rendering of services in connection with the provision of technical know-how, to other persons. Explanation. In this clause and in sub-clause (3) of clause (iii), the expression provision of technical know-how has the meaning assigned to it in sub-section (2) of section 80MM; ; (b) in clause (iii), (i) for sub-clause (1), the following sub-clauses shall be substituted, namely: (1) in the case of an industrial company or a consultancy service company .. 45%; (2) in the case of an investment company other than an investment company which falls Under sub-clause (3) of this clause .. 90%; ; (ii) in sub-clause (3), for the portion beginning with the words in the case of an Indian company and ending with the words attributable to such business .. Nil; , the following shall be substituted, namely: in the case of an Indian company, not being an industrial company or a consultancy service company, a part of whose gross total income consists of profits and gains attributable to the business of provision of technical know-how, or of rendering services in connection with the provision of technical know-how, to other persons, or of construction of ships or of manufacture or processing of goods or of mining or of generation or distribution of electricity or any other form of power (a) in relation to the said part of its gross total income .. 45%; : (iii) for the Explanation below sub-clause (3), the following Explanation shall be substituted, namely: Explanation. The provisions of this Chapter shall apply at if the aforesaid two parts of the gross total income of the company were respectively the gross total income of the company in relation to each such part and as if the amount of dividends actually distributed and the distributable income were also similarly apportioned for the purposes of section 104 and this section; .