Definition of 'State' under section 80 IB includes specified Union Territories, extending deduction eligibility for industrial undertakings in those areas. The term State in sub section (4) of section 80 IB of the Income tax Act includes the Union Territories specified in the Eighth Schedule; Circular No. 788 dated 11 4 2000 clarifies this to ensure industrial undertakings in those Union Territories are eligible for the deduction under sub section (4) and to correct restrictive field interpretations that excluded such Union Territories.