Cap on deduction for professional fees restricts allowable deductions for non-employee services and advice in tax proceedings. The amendment introduces a limiting sub section (effective 1 April 1986) that prohibits deductions in excess of ten thousand rupees per assessment year for fees or remuneration paid to non employees for: services (other than return preparation) in proceedings under the Act before tax authorities, the designated commission, competent authority, the Appellate Tribunal or any court; services in other court proceedings relating to tax, penalty or interest; and advice connected with tax, penalty, interest or other matters under the Act.