9911796707
TMI BlogSpecial provision in respect of newly established undertakings in free trade zone, etc.X X X X Extracts X X X X X X X X Extracts X X X X ..... years : Provided further that where an undertaking initially located in any free trade zone or export processing zone is subsequently located in a special economic zone by reason of conversion of such free trade zone or export processing zone into a special economic zone, the period of ten consecutive assessment years referred to in this sub-section shall be reckoned from the assessment year relevant to the previous year in which the 2 [ undertaking began to manufacture or produce such articles or things or computer software ] in such free trade zone or export processing zone : 3 [Provided also that for the assessment year beginning on the 1st day of April, 2003, the deduction under this sub-section shall be ninety per cent of the profits and gains derived by an undertaking from the export of such articles or things or computer software :] Provided also that no deduction under this section shall be allowed to any undertaking for the assessment year beginning on the 1st day of April, 19 [ 2012 ] and subsequent years. 4 [ (1A) Notwithstanding anything contained in sub-section (1), the deduction, in computing the total income of an undertaking, which begi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here any amount credited to the Special Economic Zone Re-investment Allowance Reserve Account under clause ( ii ) of sub-section (1A),- ( a ) has been utilised for any purpose other than those referred to in sub-section (1B), the amount so utilised; or ( b ) has not been utilised before the expiry of the period specified in sub-clause ( i ) of clause ( a ) of sub-section (1B), the amount not so utilised, shall be deemed to be the profits,- ( i ) in a case referred to in clause ( a ), in the year in which the amount was so utilised; or ( ii ) in a case referred to in clause ( b ), in the year immediately following the period of three years specified in sub-clause ( i ) of clause ( a ) of sub-section (1B), and shall be charged to tax accordingly. ] (2) This section applies to any undertaking which fulfils all the following conditions, namely :- ( i ) it has begun or begins to manufacture or produce articles or things or computer software during the previous year relevant to the assessment year- ( a ) commencing on or after the 1st day of April, 1981, in any free trade zone; or ( b ) commencing on or after the 1st day of April, 1994, in any electronic hardw ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inning on or after the 1st day of April, 2001, unless the assessee furnishes in the prescribed form, 21 [****] the report of an accountant, as defined in the Explanation below sub-section (2) of section 288 22 [ before the specified date referred to in section 44AB ] , certifying that the deduction has been correctly claimed in accordance with the provisions of this section. (6) Notwithstanding anything contained in any other provision of this Act, in computing the total income of the assessee of the previous year relevant to the assessment year immediately succeeding the last of the relevant assessment years, or of any previous year, relevant to any subsequent assessment year,- ( i ) section 32, section 32A, section 33, section 35 and clause ( ix ) of sub-section (1) of section 36 shall apply as if every allowance or deduction referred to therein and relating to or allowable for any of the relevant assessment years 9 [ ending before the 1st day of April, 2001 ], in relation to any building, machinery, plant or furniture used for the purposes of the business of the undertaking in the previous year relevant to such assessment year or any expenditure incurred for th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has begun or begins to manufacture or produce articles or things or computer software during the previous year relevant to the assessment year commencing on or after the 1st day of April, 2006 in any Special Economic Zone. ] (8) Notwithstanding anything contained in the foregoing provisions of this section, where the assessee, before the due date for furnishing the return of income under sub-section (1) of section 139, furnishes to the Assessing Officer a declaration in writing that the provisions of this section may not be made applicable to him, the provisions of this section shall not apply to him for any of the relevant assessment years. ( 9 ) 13 [ *** ] ( 9A ) 14 [***] Explanation 1.- 15 [***] Explanation 2.- For the purposes of this section,- ( i ) computer software means- ( a ) any computer programme recorded on any disc, tape, perforated media or other information storage device; or ( b ) any customized electronic data or any product or service of similar nature, as may be notified by the Board, which is transmitted or exported from India to any place outside India by any means; ( ii ) convertible foreign exchange means forei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Substituted by the Finance Act, 2000, w.e.f. 1-4-2001. Prior to its substitution, section 10A was inserted by the Finance Act, 1981, w.e.f. 1-4-1981, and later on amended by the Taxation Laws (Amendment and Miscellaneous Provisions) Act, 1986, w.e.f. 1-4-1987, Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988/1-4-1989, Finance Act, 1987, w.r.e.f. 1-4-1981/w.e.f. 1-4-1988, Finance Act, 1988, w.e.f. 1-4-1989, Finance Act, 1993, w.e.f. 1-4-1994/w.r.e.f. 1-4-1991, Finance Act, 1995, w.e.f. 1-4-1996, Income-tax (Second Amendment) Act, 1998, w.e.f. 1-4-1999 and Finance Act, 1999, w.e.f. 1-4-2000. 2. Substituted for undertaking was first set up by the Finance Act, 2001, w.e.f. 1-4-2001. 3. Inserted by the Finance Act, 2002, w.e.f. 1-4-2003. Earlier the third proviso was omitted by the Finance Act, 2001, w.e.f. 1-4-2002. Prior to omission, third proviso read as under : Provided also that the profits and gains derived from such domestic sales of articles or things or computer software as do not exceed twenty-five per cent of total sales shall be deemed to be the profits and gains derived from the export of articles or things or computer software: 4. Sub-sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Finance Act, 2003, w.e.f. 1-4-2004. Prior to its omission, sub-section (9A), as inserted by the Finance Act, 2002, w.e.f. 1-4-2003, read as under : (9A) Notwithstanding anything contained in sub-section (9), where as a result of reorganisation of business, a firm or a sole proprietary concern is succeeded by a company and the ownership or beneficial interest in the undertaking of the firm or the sole proprietary concern is transferred to the company, the deduction under sub-section (1) in respect of such undertaking shall be allowed to the company, as the same would have been allowed to such firm or sole proprietary concern, as the case may be, if the reorganisation had not taken place: Provided that,- (a) in the case of a firm, the aggregate of the shareholding in the company of the partners of the firm is not less than fifty-one per cent of the total voting power in the company and their shareholding continues to be as such for the period for which the company is eligible for deduction under this section; (b) in the case of a sole proprietary concern, the shareholding of the sole proprietor in the company is not less than fifty-one per cent of the total voti ..... 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