Rent payments to eligible REITs escape tax deduction when specified industrial machinery assets are directly owned by them.

Rent credited or paid to a Business Trust that is a Real Estate Investment Trust (REIT) is not subject to tax deduction at source where it falls within the specified rent entry. The non-deduction applies only if the rent concerns a real estate asset identified in Schedule V as industrial machinery and that asset is directly owned by the REIT. Each condition concerning the nature of the payment, status of the recipient, specified asset category, and direct ownership must be satisfied.

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