Income-tax Act, 1961
(1) Where the gross total income of an assessee,— (i) being a scheduled bank, or, any bank incorporated by or under the laws of a country outside India; and having an Offshore Banking Unit in a Special Economic Zone; or (ii) being a Unit of an International Financial Services Centre, includes any income referred to in sub-section (2), there shall be allowed, in accordance with and subject to the provisions of this section, a deduction from such income, of an amount equal to— (a) one hundred per cent of such income for five consecutive assessment years beginning with the assessment year relevant to the previous year in which the permission, under clause (a) of sub-section (1) of section 23 of the Banking Regulation Act, 1949 (10 of 1949) or permission or registration under the Securities and Exchange Board of India Act, 1992 (15 of 1992) or any other relevant law was obtained, and thereafter; (b) fifty per cent. of such income for five consecutive assessment years. (2) The income referred to in sub-section (1) shall be the income— (a) from an Offshore Banking Unit in a Special Economic Zone; or (b) from the business referred to in sub-section (1) of section 6 of the Banking Regulation Act, 1949 (10 of 1949) with an undertaking located in a Special Economic Zone or any other undertaking which develops, develops and operates or develops, operates and maintains a Special Economic Zone; or (c) from any Unit of the International Financial Services Centre from its business for which it has been approved for setting up in such a Centre in a Special Economic Zone. (3) No deduction under this section shall be allowed unless the assessee furnishes along with the return of income,— (i) the report, in the form specified by the Central Board of Direct Taxes under clause (i) of sub-section (2) of section 80LA, as it stood immediately before its substitution by this section, of an accountant as defined in the Explanation below sub-section (2) of section 288, certifying that the deduction has been correctly claimed in accordance with the provisions of this section; and (ii) a copy of the permission obtained under clause (a) of sub-section (1) of section 23 of the Banking Regulation Act, 1949 (10 of 1949). Explanation.—For the purposes of this section,— (a) “International Financial Services Centre” shall have the same meaning as assigned to it in clause (q) of section 2 of the Special Economic Zones Act, 2005; (b) “scheduled bank” shall have the same meaning as assigned to it in clause (e) of section 2 of the Reserve Bank of India Act, 1934 (2 of 1934); (c) “Special Economic Zone” shall have the same meaning as assigned to it in clause (za) of section 2 of the Special Economic Zones Act, 2005; (d) “Unit” shall have the same meaning as assigned to it in clause (zc) of section 2 of the Special Economic Zones Act, 2005.] 80M. [Deduction in respect of certain inter-corporate dividends].—Omitted by the Finance Act, 2003 (32 of 2003), s. 43 (w.e.f. 1-4-2004). 80MM. [Deduction in the case of an Indian company in respect of royalties, etc., received from any concern in India].—Omitted by the Finance Act, 1983 (11 of 1983), s. 29 (w.e.f. 1-4-1984). Original section was inserted by the Finance Act, 1969 (14 of 1969), s. 9 (w.e.f. 1-4-1970). 80N. [Deduction in respect of dividends received from certain foreign companies].—Omitted by the Finance Act, 1985 (32 of 1985), s. 22 (w.e.f. 1-4-1986). Section 85B which was inserted by the Finance Act, 1966 (13 of 1966), s. 17 (w.e.f. 1-4-1966). Omitted section 80N was inserted in place of section 85B which was deleted by the Finance (No. 2) Act, 1967 (20 of 1967), s. 33 and the Third Schedule (w.e.f. 1-4-1968). [80-O.Deduction in respect of royalties, etc., from certain foreign enterprises.— [Where the gross total income of an assessee, being an Indian company] [or a person (other than a company) who is resident in India],] includes [any income received by the assessee from the Government of a foreign State or foreign enterprise in consideration for the use outside India of any patent, invention, design or registered trade mark] [and such income is received in convertible foreign exchange in India, or having been received in convertible foreign exchange outside India, or having been converted into convertible foreign exchange outside India, is brought into India, by or on behalf of the assessee in accordance with any law for the time being in force for regulating payments and dealings in foreign exchange, there shall be allowed, in accordance with and subject to the provisions of this section, [a deduction of an amount equal to— (i) forty per cent. for an assessment year beginning on the 1st day of April, 2001; (ii) thirty per cent. for an assessment year beginning on the 1st day of April, 2002; (iii) twenty per cent. for an assessment year beginning on the 1st day of April, 2003; (iv) ten per cent. for an assessment year beginning on the 1st day of April, 2004, of the income so received in, or brought into, India, in computing the total income of the assessee and no deduction shall be allowed in respect of the assessment year beginning on the 1st day of April, 2005 and any subsequent assessment year]]: [ [Provided] that such income is received in India within a period of six months from the end of the previous year, or [within such further period as the competent authority may allow in this behalf]:] [ Provided further that no deduction under this section shall be allowed unless the assessee furnishes a certificate, in the prescribed form, along with the return of income, certifying that the deduction has been correctly claimed in accordance with the provisions of this section.] [Explanation.—For the purposes of this section,— (i) “convertible foreign exchange” means foreign exchange which is for the time being treated by the Reserve Bank of India as convertible foreign exchange for the purposes of the law for the time being in force for regulating payments and dealings in foreign exchange; [(ii) “foreign enterprise” means a person who is a non-resident;]] [(iii) services rendered or agreed to be rendered outside India shall include services rendered from India but shall not include services rendered in India;] [(iv) “competent authority” means the Reserve Bank of India or such other authority as is authorised under any law for the time being in force for regulating payments and dealings in foreign exchange.]