Deduction for Tea, Coffee, Rubber Business - Section 33AB - Income Tax - Ready Reckoner - Income Tax

Deduction for Tea, Coffee, Rubber Business - Section 33AB Eligible Assessees: All assessees engaged in the business of growing and manufacturing tea, coffee or rubber in India. Quantum of Deduction: The deduction shall be lower of the following: Amount deposited in NABARD or Deposit Account. 40% of PGBP of such business before deduction u/s 33AB Notes: Deduction to be allowed before setting off the brought forward losses. Deduction u/s 33AB is given from the composite income from business of growing and manufacturing tea/coffee/rubber i.e. composite of exempt non-exempt income. It is not given from the non-exempt income. Conditions: Assessee must deposit any amount in: i. An account with NABARD (under an scheme approved by Tea Board or Coffee board or the Rubber Board) ii. A deposit account under the scheme framed by Tea Board or the Coffee Board or the Rubber Board. Amount must be deposited before the due date of furnishing the return of income. Time Period of Deposit: (a) 6 months from end of the financial year in which deduction claimed i.e., 30th September or (b) Return filing date (31 July/ 30th September/30 November) whichever is earlier. Withdrawal of amount from NABARD/ Deposit Account: Any amount can be withdrawn from NABARD/ Deposit Account for the purposes specified in the scheme of Tea Board or the coffee board or the rubber board, as the case may be or in the following circumstances: Non Taxable Taxable* Death of an assessee Closure of Business Partition of HUF Dissolution of firm Liquidation of company *Taxable under the head PGBP in the year of withdrawal. Misutilisation of money from NABARD/ Deposit Account: If any amount deposited with NABARD/ Deposit account is utilized for purchase of following assets, then the amount so utilized shall be deemed to be the income of the previous year in which assets are purchased: Any machinery or plant to be installed in any office premises or residential accommodation, including any accommodation in the nature of a guest house. Any office appliances (not being computers) Any machinery or plant, the whole of the actual cost of which is allowed as a deduction in computing the income chargeable under the head PGBP of any one previous year. Audit requirements: Compulsory audit required by CA, to claim deduction under this deduction, CA should give report in prescribed form ( Form 3AC ) If accounts already audited under any law then separate audit under this section not required. However audit report in Form 3C required. Withdrawal of Deductions: Where amount in the NABARD/ Deposit account is utilized as per the scheme for the purpose of any revenue expenditure, such expenditure shall not be allowed as a deduction in computing PGBP. Where amount withdrawn from NABARD/ Deposit account is used as per the scheme for purchase of any Plant Machinery, then depreciation shall not be allowed on such plant machinery. If the amount is withdrawn from the purpose of scheme and is fully/ partly not utilize in the previous year in which it is withdrawn, then the amount not utilized shall be deemed to be the income u/h PGBP of that previous year Utilisation should be in the same previous year in which withdrawn. Where any asset acquired in accordance with the scheme is sold or otherwise transferred in any previous year by the assessee to any person at any time before the expiry of 8 years from the end of the previous year in which it was acquired, such part of the cost of the asset as is relatable to the deduction under section 33AB shall be deemed to be the PGBP of the previous year in which asset is sold/ transferred.