Senior citizen interest deduction covers bank, co-operative and post office deposits, subject to a statutory cap and exclusions.

Deduction is available to an individual senior citizen for interest income included in gross total income from deposits with a bank, co-operative banking society, or post office, including time deposits, subject to the specified cap and conditions. No deduction is allowed where the relevant income arises from deposits held by or on behalf of a firm, AOP, or BOI in relation to the partner or member concerned. Time deposits are deposits repayable on expiry of fixed periods.

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