Section 43D - Special Provision in case of income of public financial institutions - Income Tax - Ready Reckoner - Income Tax

Section 43D :- Interest Income on Bad Doubtful Debts of public financial institutions, Public Companies [ w.e.f. 01.04.2025 Omitted Vide Finance (No. 2) Act, 2024 ] In case of Public Financial Institutions or State financial Corporation or State Industrial Investment Corporation or Scheduled bank or a co-operative bank other than primary agricultural credit society or a primary co-operative agricultural rural development bank, or a deposit taking non-banking financial company or a systemically important non-deposit taking non-banking financial company [such class of non-banking financial companies as may be notified by the Central Government in the Official Gazette in this behalf, Amended by FA, 2023 ] the Interest income on bad and doubtful debts prescribed by RBI. In case of Public company carrying on business of providing long term finance for residential houses interest income on bad and doubtful debts prescribed by National Housing Bank. [ w.e.f. 01.04.2025 Omitted Vide Finance (No. 2) Act, 2024 ] shall be chargeable to tax in the previous year in which it is credited by the assessee to its profit and loss account for that year or in the previous year in which it is actually received by the assessee whichever is earlier. Explanation .- For the purposes of this section,- ( a ) National Housing Bank means the National Housing Bank established under section 3 of the National Housing Bank Act, 1987; ( b ) public company means a company,- ( i ) which is a public company within the meaning of section 3 of the Companies Act, 1956 ; ( ii ) whose main object is carrying on the business of providing long-term finance for construction or purchase of houses in India for residential purposes; and ( iii ) which is registered in accordance with the Housing Finance Companies (NHB) Directions, 1989 given under section 30 and section 31 of the National Housing Bank Act, 1987; [ Explanation (a) and (b) w.e.f. 01.04.2025 Omitted vide Finance (No. 2) Act, 2024 ] ( c ) public financial institution shall have the meaning assigned to it in section 4A of the Companies Act, 1956 ; ( d ) scheduled bank shall have the meaning assigned to it in clause ( ii ) of the Explanation to clause ( viia ) of section 36(1); ( e ) 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; ( f ) State industrial investment corporation means a Government company within the meaning of section 617 of the Companies Act, 1956 , engaged in the business of providing long-term finance for industrial projects . (g) 'co-operative bank', 'primary agricultural credit society' and 'primary co-operative agricultural rural development bank' shall have the meaning u/s 80P(4) . (h) the expressions deposit taking non-banking financial company , non-banking financial company and systemically important non-deposit taking non-banking financial company shall have the meanings respectively assigned to them in clauses (e), (f) and (g) of Explanation 4 to section 43B .