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Section 10-AA - Rationalisation of provisions of Section 10AA

 

Under the existing provisions deduction is allowed to an assessee from his the total income in respect of profits and gains from his Unit operating in SEZ, subject to certain conditions.

 

However, certain courts have taken a view (in matters pertaining to section 10A which also contains similar provision) that the deduction is to be allowed from the total income of the undertaking and not from the total income of the assessee.

 

In view of the above, it is proposed to clarify that the amount of deduction referred to in section 10AA shall be allowed from the total income of the assessee computed in accordance with the provisions of the Act before giving effect to the provisions of the section 10AA and the deduction under section 10AA in no case shall exceed the said total income.

 

The amendment will be effective from 1st April 2018.


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