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of <h1>Amortisation Deduction Rules for Mineral Prospecting Under Section 35AB with Carryforward and Audit Requirements</h1> An Indian company or resident individual engaged in prospecting, extraction, or production of specified minerals is allowed an amortisation deduction equal to one-tenth annually of qualifying expenditure incurred during the year of commercial production and up to four preceding years, excluding costs related to site acquisition, mineral deposits, or depreciable capital assets. The deductible amount is reduced by any reimbursements or compensations received. Unused deductions may be carried forward up to ten years from the start of commercial production. Non-corporate assessees must have audited accounts and submit an audit report to claim the deduction. In case of amalgamation or demerger, deductions are suspended for the transfer year but continue for the resulting company. Expenditure claimed under this section cannot be claimed elsewhere. Definitions clarify prospecting operations, commercial production year, and relevant tax years for the deduction period.
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