India - Income Tax Act 2010 - Saarc

1.265 CH. IV - COMPUTATION OF BUSINESS INCOME S. 42thereof (including the amount of scrap value, if any) the sameproportion as the amount of twenty-five thousand rupees bears to theactual cost of the motor car to the assessee as it would have beencomputed before applying the said proviso;(2) “sold” includes a transfer by way of exchange or a compulsoryacquisition under any law for the time being in force but does notinclude a transfer, in a scheme of amalgamation, of any asset by theamalgamating company to the amalgamated company where theamalgamated company is an Indian company.]49[(4A) Where a deduction has been allowed in respect of any special reservecreated and maintained under clause (viii) of sub-section (1) of section 36, anyamount subsequently withdrawn from such special reserve shall be deemed tobe the profits and gains of business or profession and accordingly be chargeableto income-tax as the income of the previous year in which such amount iswithdrawn.Explanation.—Where any amount is withdrawn from the special reserve in aprevious year in which the business is no longer in existence, the provisions of thissub-section shall apply as if the business is in existence in that previous year.](5) Where the business or profession referred to in this section is no longer inexistence and there is income chargeable to tax under sub-section (1), 50 [***] subsection(3) 51 [, sub-section (4) or sub-section (4A)] in respect of that business orprofession, any loss, not being a loss sustained in speculation business 52 [***],which arose in that business or profession during the previous year in which itceased to exist and which could not be set off against any other income of thatprevious year shall, so far as may be, be set off against the income chargeable totax under the sub-sections aforesaid.53[(6) References in sub-section (3) to any other provision of this Act which hasbeen amended or omitted by the Direct Tax Laws (Amendment) Act, 1987 shall,notwithstanding such amendment or omission, be construed, for the purposes ofthat sub-section, as if such amendment or omission had not been made.]Special provision for deductions in the case of business for prospecting, etc., formineral oil.42. 54 [(1)] For the purpose of computing the profits or gains of any businessconsisting of the prospecting for or extraction or production of mineral oilsin relation to which the Central Government has entered into an agreement with49. Inserted by the Finance Act, 1997, w.e.f. 1-4-1998.50. Words “sub-section (2), sub-section (2A),” omitted by the Taxation Laws (Amendment &Miscellaneous Provisions) Act, 1986, w.e.f. 1-4-1988. Earlier the italicised words wereinserted by the Taxation Laws (Amendment) Act, 1970, w.e.f. 1-4-1971.51. Substituted for “or sub-section (4)” by the Finance Act, 1997, w.e.f. 1-4-1998.52. Words ‘or under the head “Capital gains” ’ omitted by the Finance Act, 1987, w.e.f. 1-4-1988.53. Inserted by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1989.54. Section 42 renumbered as sub-section (1) thereof by the Finance (No. 2) Act, 1998, w.e.f.1-4-1999.