India - Income Tax Act 2010 - Saarc

1.267 CH. IV - COMPUTATION OF BUSINESS INCOME S. 43expenditure incurred in connection with the business or to obtaininterest therein and the amount of such expenditure remainingunallowed, shall be chargeable to income-tax as profits and gains ofthe business in the previous year in which the business or interesttherein, whether wholly or partly, had been transferred :Provided that in a case where the provisions of this clause do notapply, the deduction to be allowed for expenditure incurred remainingunallowed shall be arrived at by substracting the proceeds oftransfer (so far as they consist of capital sums) from the expenditureremaining unallowed.Explanation.—Where the business or interest in such business istransferred in a previous year in which such business carried on bythe assessee is no longer in existence, the provisions of this clause shallapply as if the business is in existence in that previous year;(c) are not less than the amount of the expenditure incurred remainingunallowed, no deduction for such expenditure shall be allowed inrespect of the previous year in which the business or interest in suchbusiness is transferred or in respect of any subsequent year or years:59[Provided that where in a scheme of amalgamation or demerger, the amalgamatingor the demerged company sells or otherwise transfers the business to theamalgamated or the resulting company (being an Indian company), the provisionsof this sub-section—(i) shall not apply in the case of the amalgamating or the demergedcompany; and(ii) shall, as far as may be, apply to the amalgamated or the resultingcompany as they would have applied to the amalgamating or thedemerged company if the latter had not transferred the business orinterest in the business.]]60[Explanation.—For the purposes of this section, “mineral oil” includes petroleumand natural gas.]Definitions of certain terms relevant to income from profits and gains of businessor profession.43. In sections 28 to 41 and in this section, unless the context otherwiserequires 61 —62(1) “actual cost” means the actual cost 61 of the assets to the assessee,reduced by that portion of the cost thereof, if any, as has been met 61directly or indirectly by any other person or authority:59. Substituted by the Finance Act, 1999, w.e.f. 1-4-2000. Prior to its substitution, proviso wasinserted by the Finance (No. 2) Act, 1998, w.e.f. 1-4-1999.60. Inserted by the Finance Act, 1981, w.e.f. 1-4-1981.61. For the meaning of the expressions “unless the context otherwise requires”, “actual cost”and “has been met”, see Taxmann’s Direct Taxes Manual, Vol. 3.62. See also Circular No. 190, dated 1-3-1976. For details, see Taxmann’s Master Guide toIncome-tax Act.For relevant case laws, see Taxmann’s Master Guide to Income-tax Act.