India - Income Tax Act 2010 - Saarc

S. 10(23FA) I.T. ACT, 1961 1.9019[(23FA) any income by way of dividends 20 [, other than dividends referred toin section 115-O ], or long-term capital gains of a venture capital fundor a venture capital company from investments made by way ofequity shares in a venture capital undertaking :Provided that such venture capital fund or venture capital companyis approved, for the purposes of this clause, by the Central Governmenton an application made to it in accordance with the rules 21 madein this behalf and which satisfies the prescribed conditions :Provided further that any approval by the Central Government shall,at any one time, have effect for such assessment year or years, notexceeding three assessment years, as may be specified in the order ofapproval :22[Provided also that nothing contained in this clause shall apply inrespect of any investment made after the 31st day of March, 2000.]Explanation.—For the purposes of this clause,—(a) “venture capital fund” means such fund, operating under a trustdeed registered under the provisions of the Registration Act, 1908(16 of 1908), established to raise monies by the trustees forinvestments mainly by way of acquiring equity shares of a venturecapital undertaking in accordance with the prescribed guidelines;(b) “venture capital company” means such company as has madeinvestments by way of acquiring equity shares of venture capitalundertakings in accordance with the prescribed guidelines; and(c) “venture capital undertaking” means such domestic companywhose shares are not listed in a recognised stock exchange inIndia and which is engaged in the—(i) business of—(A) software;(B) information technology;(C) production of basic drugs in the pharmaceutical sector;(D) bio-technology;(E) agriculture and allied sectors; or(F) such other sectors as may be notified 23 by the CentralGovernment in this behalf; or(ii) production or manufacture of any article or substance forwhich patent has been granted to the National Research19. Inserted by the Finance Act, 1999, w.e.f. 1-4-2000.20. Inserted by the Finance Act, 2003, w.e.f. 1-4-2004. Earlier, it was omitted by the FinanceAct, 2002, w.e.f. 1-4-2003.21. See rule 2DA and Form Nos. 56AA, 56BA and 56CA.22. Inserted by the Finance Act, 2000, w.e.f. 1-4-2001.23. See also notification issued under section 10(23F). For details, see Taxmann’s MasterGuide to Income-tax Act.