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section 40(a)

Posted @ August 14, 2013, 12:56 am under (TAX AUDIT)

Section 40(a) in The Income- Tax Act, 1995
 
(a) in the case of any assessee-
 
(i) 5[ any interest (not being interest on a loan issued for public subscription before the 1st day of April, 1938 ), royalty, fees for technical services or other sum chargeable under this Act, which is payable outside India, on which tax has not been paid or deducted under Chapter XVII- B: Provided that where in respect of any such sum, tax has been paid or deducted under Chapter XVII- B in any subsequent year, such sum shall be allowed as a deduction in computing the income of the previous year in which such tax has been paid or deducted. Explanation.- For the purposes of this sub- clause,-
 
(A) " royalty" shall have the same meaning as in Explanation 2 to clause (vi) of sub- section (1) of section 9;
 
(B) " fees for technical services" shall have the same meaning as in Explanation 2 to clause (vii) of sub- section (1) of section 9;]
 
(ii) any sum paid on account of any rate or tax levied on the profits or gains of any business or profession or assessed at a proportion of, or otherwise on the basis of, any such profits or gains;
 
(iia) 1[ any sum paid on account of wealth- tax. Explanation.- For the purposes of this sub- clause," wealth- tax" means wealth- tax chargeable under the Wealth- tax Act, 1957 (27 of 1957 ), or any tax of a similar character chargeable under any law in force in any country outside India or any tax chargeable under such law with reference to the value of the assets of, or the capital employed in, a business or profession carried on by the assessee, whether or not the debts of the business or profession are allowed as a deduction in computing the amount with reference to which such tax is charged, but does not include any tax chargeable with reference to the value of any particular asset of the business or profession;]
 
(iii) any payment which is chargeable under the head" Salaries", if it is payable outside India and if the tax has not been paid thereon nor deducted therefrom under Chapter XVII- B;
 
(iv) any payment to a provident or other fund established for the benefit of employees of the assessee, unless the assessee has made effective arrangements to secure that tax shall be deducted at source from any payments made from the fund which are chargeable to tax under the head" Salaries";

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