Deduction Claimed Under sec. 35AD


Deduction Claimed Under sec. 35AD

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Adjusted total income for purpose of AMT to include deduction claimed under section 35AD after adjustment of depreciation [Section 115JC(2)]

Adjusted total income for purpose of AMT to include deduction claimed under section 35AD after adjustment of depreciation [Section 115JC(2)] [W.e.f. A.Y. 2015-16]

 

The existing provisions of section 115JC provide that where the regular income tax payable by a person, other than a company, for a previous year is less than the alternate minimum tax for such previous year, the person would be required to pay income tax at the rat of eighteen and one half per cent on its adjusted total income. The section further proves that the total income shall be increased by the following to arrive at adjusted total income: (a) deductions claimed under any section (other than section 80P included in Part C of Chapter VI-A) i.e. sections 80- IA to 80RRB other than section 80P, and (b) deductions claimed under section 10AA. Under the Income-tax Act, the investment linked deductions have been provided in place of profit linked deductions. These profit linked deductions are subject to alternate minimum tax (AMT). Accordingly, with a view to include the investment linked deduction claimed under section 35AD in computing adjusted total income for the purpose of calculating alternate minimum tax, the Act has amended section 115JC(2) so as to provide that besides the above two deductions mentioned under clause (a) and (b) above, the total income shall also be increased by the deduction claimed under section 35 AD for purpose of computation of adjusted total income. The amount of depreciation allowable under section 32 shall, however, be reduced in computing the adjusted total income.BACK

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