Transfer to Special Reserve - (New) Section 32(e) / Section 36(1)(viii)

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....anking companies • Co-operative banks (excluding primary agricultural credit societies and rural development banks) • Housing finance companies • Other notified financial corporations/public companies The deduction is allowed only if the entity is engaged in long-term finance for: • 1. in respect of the specified entity referred to above 1 to 4  • Industrial development • Agricultural development • Infrastructure development • Housing development • 2. in respect of the specified entity referred to above 5 (Housing finance companies) • the business of providing long-term finance for the construct....

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....l purposes; [ Section 66(6) ] • "Long-term finance", Means for the purposes of section 32(e), means any loan or advance where the terms under which moneys are loaned or advanced provide for repayment along with interest thereof during a period of not less than five years; [ Section 66(10) ] Infrastructure facility for the purposes of section 32(e) [ Rule 24 ] The following conditions shall be fulfilled by a public facility to be eligible to be notified as an infrastructure facility under section 32(e):- • (a) it is owned by a company registered in India or by a consortium of such companies or by an authority or a board or a corporation or any other body established or constituted under any Central A....

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....m finance for: • Industrial or agricultural development  • Development of infrastructure facility in India  • Development of housing in India QUANTUM OF DEDUCTION: Amount of deduction under section 36(1)(viii) is as follows- • The amount transferred during the previous year to the special reserve account created for the purpose of section 36(1)(viii) OR • 20% of the profits derived from the business activities mentioned above, which is computed under section 28 to 44D but before claiming deduction under section 36(1)(viii) OR • 200% of paid up share capital and general reserve as on the last day of the previous year minus the balance of the special....