Examination of 'Qualifying Ship' : Clause 235(i) of the Income Tax Bill, 2025 Vs. Section 115VD of the Income-tax Act, 1961

Qualifying ship definition governs tonnage tax eligibility by tying registration, certification, and operational use to tax benefit access.

The definition of qualifying ship in Clause 235(i) requires three operative conditions for tonnage tax eligibility: a minimum net tonnage, registration under the relevant shipping statute or an authorised foreign licence, and a valid certificate evidencing net tonnage. It lists explicit exclusions-vessels providing services normally provided on land, fishing vessels, factory ships, pleasure crafts, harbour and river ferries, offshore installations-and disqualifies vessels used for fishing beyond a specified threshold in a tax year, anchoring eligibility in maritime regulatory certification and operational use.