India - Income Tax Act 2010 - Saarc

S. 36 I.T. ACT, 1961 1.242term finance for industrial projects and 40 [eligible for deductionunder clause (viii) of this sub-section];]41[(vi) “co-operative bank”, “primary agricultural credit society” and“primary co-operative agricultural and rural development bank”shall have the meanings respectively assigned to them in theExplanation to sub-section (4) of section 80P;]42[(viii) in respect of any special reserve created and maintained by aspecified entity, an amount not exceeding twenty per cent of theprofits derived from eligible business computed under the head“Profits and gains of business or profession” (before making anydeduction under this clause) carried to such reserve account:Provided that where the aggregate of the amounts carried to suchreserve account from time to time exceeds twice the amount of thepaid up share capital and of the general reserves of the specifiedentity, no allowance under this clause shall be made in respect of suchexcess.Explanation.—In this clause,—(a) “specified entity” means,—(i) a financial corporation specified in section 4A of the CompaniesAct, 1956 (1 of 1956) 43 ;(ii) a financial corporation which is a public sector company;40. Substituted for “approved by the Central Government under clause (viii) of this subsection”by the Finance Act, 2000, w.e.f. 1-4-2000.41. Inserted by the Finance Act, 2007, w.e.f. 1-4-2007.42. Substituted, ibid., w.e.f. 1-4-2008. Prior to its substitution, clause (viii), as amended by theFinance Act, 1966, w.e.f. 1-4-1966, Finance (No. 2) Act, 1967, w.e.f. 1-4-1968, Finance Act,1970, w.r.e.f. 1-4-1966, Finance (No. 2) Act, 1971, w.e.f. 1-4-1972, Finance Act, 1974, w.e.f.1-4-1975, Finance Act, 1979, w.e.f. 1-4-1980, Finance Act, 1981, w.e.f. 1-4-1982, Finance Act,1985, w.e.f. 1-4-1985, Finance (No. 2) Act, 1991, w.r.e.f. 1-4-1987, Finance Act, 1992, w.r.e.f.1-4-1987, Finance Act, 1995, w.e.f. 1-4-1996, Finance (No. 2) Act, 1996, w.r.e.f. 1-4-1996/w.e.f. 1-4-1997, Finance Act, 1997, w.e.f. 1-4-1998, Finance Act, 1999, w.e.f. 1-4-2000 andFinance Act, 2006, w.e.f. 1-4-2007, read as under :‘(viii) in respect of any special reserve created and maintained by a financial corporationwhich is engaged in providing long-term finance for industrial or agriculturaldevelopment or development of infrastructure facility in India or by a publiccompany formed and registered in India with the main object of carrying on thebusiness of providing long-term finance for construction or purchase of houses inIndia for residential purposes, an amount not exceeding forty per cent of the profitsderived from such business of providing long-term finance (computed under thehead “Profits and gains of business or profession” before making any deductionunder this clause) carried to such reserve account:Provided that where the aggregate of the amounts carried to such reserve accountfrom time to time exceeds twice the amount of the paid-up share capital and of thegeneral reserves of the corporation or, as the case may be, the company, noallowance under this clause shall be made in respect of such excess.Explanation.—In this clause,—(a) “financial corporation” shall include a public company and a Governmentcompany;(Contd. on p. 1.243)