Deduction for Tea, Coffee, Rubber Business - (New) Section 48 / (Old) Section 33AB

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....funds are: • Withdrawn • Utilised • Released • at the time of closure or otherwise. Then the amount becomes taxable in that year, as per Schedule IX. Sub-section (3): Sale of Assets • If assets acquired using these funds are: • Sold, or • Transferred • Tax treatment will follow Schedule IX rules. Specified condition under Schedule IX 1. Quantum of Deduction  An assessee shall be allowed deduction of Lower of  • Amount deposited in specified account, OR • 40% of business profits (before this deduction) Deduction is allowed before setting off losses brought forward from earlier ta....

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....ss profit (3.3) Use for prohibited assets: If withdrawn and used to buy restricted items, it becomes taxable. Restricted items include: • any machinery or plant to be installed in any office premises or residential accommodation (including guest house) • Office appliances (except computers) • any machinery or plant, which is allowed as a deduction under any other provision • Certain industrial machinery (3.4) Not utilized properly: • If withdrawal amount not used for intended purpose within the tax year, wholly or partly • Such amount not utilised shall becomes taxable income for that tax year (3.5) Exceptions: - No taxation....

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.... • Amount deposited in NABARD or Deposit Account. • 40% of PGBP of such business before deduction u/s 33AB Notes: • Deduction to be allowed before setting off the brought forward losses. • Deduction u/s 33AB is given from the composite income from business of growing and manufacturing tea/coffee/rubber i.e. composite of exempt & non-exempt income. It is not given from the non-exempt income. Conditions: • Assessee must deposit any amount in: i. An account with NABARD (under an scheme approved by Tea Board or Coffee board or the Rubber Board) ii. A deposit account under the scheme framed by Tea Board or the Coffee Board or the Rubber Board. Amount must be deposit....

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.... Compulsory audit required by CA, to claim deduction under this deduction, CA should give report in prescribed form (Form 3AC) • If accounts already audited under any law then separate audit under this section not required. However audit report in Form 3C required. Withdrawal of Deductions: • Where amount in the NABARD/ Deposit account is utilized as per the scheme for the purpose of any revenue expenditure, such expenditure shall not be allowed as a deduction in computing PGBP. • Where amount withdrawn from NABARD/ Deposit account is used as per the scheme for purchase of any Plant & Machinery, then depreciation shall not be allowed on such plant & machinery. • If the amount is withdra....