India - Income Tax Act 2010 - Saarc

1.425 CH. VIA - DEDUCTIONS IN RESPECT OF CERTAIN INCOMES S. 80HHC47[Deduction in respect of profits retained for export business.4880HHC. 49 [(1) Where an assessee, being an Indian company or a person(other than a company) resident in India, is engaged in the business ofexport out of India of any goods or merchandise to which this section applies,there shall, in accordance with and subject to the provisions of this section, beallowed, in computing the total income of the assessee, 50 [a deduction to theextent of profits 51 , referred to in sub-section (1B),] derived by the assessee fromthe export of such goods or merchandise :Provided that if the assessee, being a holder of an Export House Certificate or aTrading House Certificate (hereafter in this section referred to as an ExportHouse or a Trading House, as the case may be,) issues a certificate referred toin clause (b) of sub-section (4A), that in respect of the amount of the exportturnover specified therein, the deduction under this sub-section is to be allowedto a supporting manufacturer, then the amount of deduction in the case of theassessee shall be reduced by such amount which bears to the 52 [total profitsderived by the assessee from the export of trading goods, the same proportionas the amount of export turnover specified in the said certificate bears to the totalexport turnover of the assessee in respect of such trading goods].(1A) Where the assessee, being a supporting manufacturer, has during theprevious year, sold goods or merchandise to any Export House or Trading Housein respect of which the Export House or Trading House has issued a certificateunder the proviso to sub-section (1), there shall, in accordance with and subjectto the provisions of this section, be allowed in computing the total income of theassessee, 53 [a deduction to the extent of profits, referred to in sub-section (1B),]derived by the assessee from the sale of goods or merchandise to the ExportHouse or Trading House in respect of which the certificate has been issued bythe Export House or Trading House.]47. Substituted by the Finance Act, 1985, w.e.f. 1-4-1986. Original section was inserted by theFinance Act, 1983, w.e.f. 1-4-1983.48. See also Letter [F.No. 178/206/83-IT(A-I)], dated 22-5-1984, Circular No. 466, dated14-8-1986, Circular No. 562, dated 23-5-1990, Circular No. 571, dated 1-8-1990, Circular No.575, dated 31-8-1990, Circular No. 600, dated 23-4-1991, Circular No. 624, dated 23-1-1992,Circular No. 693, dated 17-11-1994, Circular No. 729, dated 1-11-1995, Circular No. 1/2001,dated 17-1-2001, Circular No. Nil, dated 17-2-2004, Clarifications dated 12-4-2005, 29-6-2005 & 31-10-2005, Circular No. 2/2006, dated 17-1-2006 and Circular No. 5/2006, dated15-5-2006. For details, see Taxmann’s Master Guide to Income-tax Act.49. Substituted by the Finance Act, 1988, w.e.f. 1-4-1989. Prior to its substitution, sub-section(1) was amended by the Taxation Laws (Amendment & Miscellaneous Provisions) Act,1986, w.e.f. 1-4-1987.50. Substituted for “a deduction of the profits” by the Finance Act, 2000, w.e.f. 1-4-2001. Earlierthe quoted portion was amended by the Direct Tax Laws (Amendment) Act, 1989, w.e.f.1-4-1989.51. For the meaning of the terms “profits” and “derived from”, see Taxmann’s Direct TaxesManual, Vol. 3.52. Substituted for the words “total profits of the export business of the assessee the sameproportion as the amount of export turnover specified in the said certificate bears to thetotal export turnover of the assessee” by the Finance Act, 1992, w.e.f. 1-4-1992.53. Substituted for “a deduction of the profits” by the Finance Act, 2000, w.e.f. 1-4-2001. Earlierthe quoted portion was amended by the Direct Tax Laws (Amendment) Act, 1989, w.e.f.1-4-1989.