Amortisation of prospecting expenditure permits staged deductions to offset income from commercial mineral exploitation under specified conditions. The section permits eligible Indian resident assessees engaged in prospecting, extraction or development of specified minerals to amortise qualifying expenditure incurred in the year of commercial production and up to four prior years by claiming an annual instalment reduced for third party payments and receipts, excluding site or deposit acquisitions and depreciable capital assets; the deduction each year is the lesser of that instalment or the amount needed to reduce income from commercial exploitation to nil, with unallowed instalments carried forward but not beyond ten years, subject to audit requirements for non corporate claimants and transfer rules on amalgamation or demerger.