Reserves for shipping business: deduction allowed for shipping public companies subject to utilisation rules and deemed income on misuse. Allows Indian public companies carrying on ship operations to deduct amounts credited to a reserve account, capped by an aggregate limit tied to paid-up share capital, provided the reserve is utilised within eight years for acquiring a new ship or otherwise for business (excluding dividend distribution, remittance as profits, or creation of assets outside India); misuse, non-utilisation after the period, or sale of an acquired ship within eight years results in the reserve amount being deemed profits and taxed in the specified year.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Reserves for shipping business: deduction allowed for shipping public companies subject to utilisation rules and deemed income on misuse.
Allows Indian public companies carrying on ship operations to deduct amounts credited to a reserve account, capped by an aggregate limit tied to paid-up share capital, provided the reserve is utilised within eight years for acquiring a new ship or otherwise for business (excluding dividend distribution, remittance as profits, or creation of assets outside India); misuse, non-utilisation after the period, or sale of an acquired ship within eight years results in the reserve amount being deemed profits and taxed in the specified year.
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