1

INCOME TAX ACT

SECTION
80JJA
80JJAA
80LA
80O

Pankaj Mahajan. MFM - 14

Sec. 80JJA
2

Deduction in respect of profits & gains from business of

collecting & processing of bio-degradable waste.
Eligible assessee: All assessees
Eligible business:
Collecting & processing of treating bio-degradable waste for
generating power or producing bio-fertilizers, bio-pesticides or
other agents or for producing biogas or making pellets or
briquettes for fuel or organic manure.
Quantum & period of deduction:
100% of profits & gains derived from the business mentioned
above for a period of 5 consecutive assessment years relevant to
the previous year in which such business commences.

Sec. 80JJAA
3

Deduction in respect of employment of new workmen.

Eligible assessee: Indian company
Conditions:
i.

ii.

iii.

The gross total income should include profits & gains derived from
the manufacture of goods in a factory;
The factory is not hived off or transferred from another existing entity
or acquired by the assessee company as a result of amalgamation
with another company;
Audit report of a Chartered Accountant should be furnished along
with the return of income.

Quantum & period of deduction:

An amount equal to 30% of additional wages paid to the new regular
workmen employed by the assessee in the previous year for 3
assessment years including the assessment year relevant to the
previous year in which such employment is provided.

Sec. 80JJAA contd

4

Definitions:
i.

ii.

Additional wages means the wages paid to the new regular

workmen in excess of 100 workmen employed during the
previous year. In the case of an existing factory additional
wages shall be computed only if the increase in the number of
regular workman employed during the year is 10% or more of
the existing number of workmen employed in such factory as
on the last day of the preceding year.
Regular workman does not include a casual workman or a
workman employed through contract labour or any other
workman employed for a period of less than 300 days during
the previous year.

Sec. 80JJAA contd

5

As per the Finance Bill, 2015 with effect from the 1st day of April, 2016, (a) in sub-section (1), the words being an Indian company, shall be omitted;
(b) in sub-section (2), for clause (a), the following clause shall be substituted,
namely:(a) if the factory is acquired by the assessee by way of transfer from any
other person or as a result of any business re-organisation;;
(c) in the Explanation, in clause (i), for the words one hundred workmen, the
words fifty workmen shall be substituted.

Sec. 80LA
6

Deduction for offshore banking units & International Financial

Services Centre.
Eligible assessee:
The deduction under this section is available to an assessee being
a)

b)

Scheduled bank, or any bank incorporated outside India & which owns an
offshore banking unit in a Special Economic Zone; or
A unit of an International Financial Services Centre.

Conditions:
The deduction shall be allowed to such assessee in respect of their income
received by way of convertible foreign exchange subject to the furnishing of
the following along with the return of income:
c)

d)

report from a Chartered Accountant about the correctness of the claim of

deduction in the prescribed form; and
a copy of the permission obtained from the Reserve Bank of India.

Sec. 80LA contd

7

Quantum & period of deduction:

a)

b)

100% of such income for 5 consecutive assessment years

beginning with the assessment year relevant to previous year in
which permission to operate such unit has been obtained under
Banking Regulation Act or SEBI Act or any other Statute, &
thereafter;
50% of such income for next 5 consecutive assessment years.

Sec. 80O
8

Deduction in respect of royalties, etc., from certain foreign enterprises.

Eligible assessee: Indian company or a resident individual
Conditions:
a)

b)

c)

Where the gross total income of an assessee, 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.
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;
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.

Sec. 80O contd

9

Quantum & period of deduction:

i) 40% for an assessment year beginning on the 1st day of April, 2001;
(ii) 30% for an assessment year beginning on the 1st day of April, 2002;
(iii) 20% for an assessment year beginning on the 1st day of April, 2003;
(iv) 10% 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.

10

THANK YOU