28 30 31 32(1) (iia) 32(2)

Taxable income under head of
PGBP
1. P&G of any buss/Prof
2. Profit on sale of import
entitlement licence
3. Cash compensatory
support/ DBK
4. DEPB/DFRC
5. Key-man Insurance policy
6. Gift,benefit,perq from Bor P
7. Interest, salary, bonus,
comm by partner of firm
8. Non compete fees
Rent, Rates, tax, Repair and Repair and insurance of plant 32(1)(ii) Additional Depreciation Unabsorbed Depreciation
insurance of building and machinery and furniture. Depreciation (set off & Carry forward)
Allowed Disallowed Allowed Disallowed 1. Asset should be used for B -New P&M (ship & Aircraft- X) - set off against income under MPAT= manufacture of
Rent, rates Capital repair Rent (u/s 37 Capital repair or P (Active/passive) -Acquired & Installed any head production of article or thing
& Taxes, not allowed to to tenant), not allowed to 2. Owner (Wholly/partially) - MPAT, Transmission or - C/F even if buss is closed ULF=Unamortised licence fee
Insurance, both. Insurance, both. 3. Assets used in PY distribution of power @ 20% -C/F for Indefinite period, T/f= transfer/Transferred
Revenue Capitalized Revenue Capitalized 4. Depreciation on WDV of -notified area @ 35% after even if ROI not filed Acq=Acquisition
repairs. Rent not repairs. Rent not block of the asset 01.05.15, for MPAT only -Assessee should be same C/f=Carry forward
allowed to allowed to 5. Mandatory to claim dep - if Put to use for < 180 days [exceptions)-72A,72AA,72AB GIO=Government of India
owner owner 6. 50% dep if put to use <180 (yr of acq)- Dep 50%,balance -priority of set off Ded= Deduction
32(1)(i)- Dep for power day(yr of acq) 50% in next PY 1. CY Dep.(depreciation) Buss=business
7. Asset should be PUT to USE - add dep only 4 WDV method 2. Brought forward Buss loss SP/SC/SV=Sale consideration
generating undertaking.
but not ready to use. 3. Brought forward Dep LIP= Lock in period
Optional to follow SLM

33 AB Tea/Coffee/Rubber Rule for computing income 33 ABA Site restoration fund- 35

32AD Investment in New Plant

LD
Development account Petroleum, Natural gas in India Expenditure on Scientific research
& machinery by assesses in
backward areas of AP, Bihar, All Assessee Income from Buz Agri -Any Assessee Section Purpose Ded
Telangana or WB Amount Deposited or Rubber 35 65 -Deposit- before the end of py 35(1)(i) Revenue Expenditure 100% Incurred Exp For after or before( 3 years) start of buss
40% of PGBP WEL -Deduction- 20% of profit
All Assessee [buss of MPAT] Coffee Sum paid to Research 150% Object of receiver is Scientific research (or) to
-Deposit before DD of ROI Or WEL
from PY 01-04-2015 to 2020 25 75 35(1)(ii) association university, college or others to be used for research
-Withdrawal of amount other -Deposit
Ded= 15% of actual cost of *Grown Paid to University, 100% For research in Social Science or Statistical research
than specified purpose- - Agreement with Govt

R
such new P&M; LIP= 5 Years 40 60 35(1)(iii) college or other institute {35(1)(i)/(ii)- must be approved by CG; not buss related}
taxable as PGBP in the year - withdrawal- on closure & for
No 50% restriction as 32(1)(1) *+Roasted Capital Expenditure 100% Incurred On scientific research related to business
of withdrawal; LIP= 8 Years specific purpose only
Ded in the year asset 35(1)(iv) (Except land) carried on by Assesse, post exp of 3 years
- utilise in the year of - T/f of asset before 8 years-
installed, PUT to use Tea 40 60 exemption withdrawn approved specified 150% Paid to national laboratory, university, IIT, or specified

O
withdrawal
condition NA(Not applicable) 35(2AA) person for scientific person to be used specifically for Scientific research
Deduction from composite
Ded not available to Assessee To Companies for 150% on an approved in house research & development
income (Agri +Buss income)
following SLM Method 35(2AB) scientific research facility (except L&B), Building = 100% under 35(1)(iv)

W
35ABB Amortisation of 35ABA Exp. for obtaining right 35AD 35CCC Expenditure on 35CCD Expenditure of Skill
telecom license fee to use telecom services Deduction of expenditure on specified business Agricultural extension project development project
 CE of licence fee(paid) is allowed as deduction from the year of - Capital expenditure (other -Cold chain facility - warehousing of sugar -Any Assesse -Eligible Assessee- Company
payment to end of licence. for before commencement exp, ded than Land/ Goodwill/ -Warehousing (agri) -pipeline- iron ore -Any Expenditure -Any exp except L & B)
= year of start to end of PY( licence last date) in no of years financial Instrument) -affordable housing project -Semiconductor- m/f unit -Ded= 150% of expenditure -Eligible co means any co
T/f of licence SP< ULF=Loss SP> ULF=Gain - - 35AD loss set off with 35AD -production of fertilisers - Developing/& -Condition engaged in MPAT except
A
Whole licence is Deduction in the Taxable as PGBP in - post/ after commencement, -hospital (100 beds) maintaining/& operating a *for training, education of alcohol, tobacco.
transferred year of Transfer the year of sale capital or revenue exp = -X country pipeline oil gas new infrastructure facility farmers -Training Institute- for new
(ULF –SP) Least of the following 100% deduction ;LIP= 8 years -Hotel 2** (wef 1/04/2017 *Prior approval of GOI, employee < 6 months exp
C
Part of licence is Deduction allowed a) SP – ULF - If sold or destroyed, entire SP -slum redevelopment housing No other ded for same exp. ministry of agriculture only
transferred in balance life b) Deduction allowed or Insurance Compensation -Inland container depot CE > 10,000 in a day to one *Exp should be >25L (Except -Ded= 150% of exp
(ULF- SP)/ bal life till date taxable as PGBP; NO CG -Bee –honey & Bee wax person is disallowed Land & Building)

35D Preliminary expenses 35DD Amortization of Exp in 35DDA Amortisaiton of 35E Expenditure on 36
case of amalga. or demerger expenditure on VRS. prospecting, etc for minerals Other deduction as specified
* Resident person Indian Co  Any Assesse Indian Co Insurance premium of stocks Contribution towards pension Bad debts
*Indian Co. QE= 5% of COP Ded= 1/5th of such Ded= 1/5th of the amount so Any Exp of 5 YR (Yr of start + Ins premium on life of cattle scheme u/s 80CCD Provisions for Bad & Doubtful
5% of COP or expenditure for each of 5 paid deductable in 5 4 years prior to start) Insurance on Health of emp Employer contribution to an debts
5% of CE WEH successive PY`s succeeding PY`s Ded= equally in 10 years Bonus or commission to emp approved Gratuity fund Special reserve created by
Above amount (or) From the PY in which From the PY in which amount 1/10th of QE WEL Interest on borrowed capital Allowance in respect of dead specific entity carrying on
Actual amount WEL= QE amalgamation or demerger paid Income of PY Discount on ZC Bond or permanently useless eligible business
 Ded= 1/5th of QE in each of takes place Employer contribution to animals Revenue Exp on promoting
5 successive PY`s RPF/ Approved family planning amongst the
CE= capital Exp superannuation fund employee of company only
COP=Cost of project (CE=Equal amount in 5 years)

STT, CTT paid
Expenditure incurred for
purchase of sugarcane
 Recoveries from Employees
towards welfare fund are
Deemed buss income.
Deduction allowed only if the
same is paid before filing ROI
u/s 139(1)- AIMIL Delhi HC
40(b) Deduction in respect of
payment to partner
Remuneration paid to Partner  Interest paid to partners
 Non working partner - X
 Not authorised by deed - X
 Not as per deed - X
 For prior period - X
Maximum remuneration
(As per Book profit U/s 28)
a) First 3L or Loss- Rs. 1.5 L
or 90 % of BP WEH
b) On bal BP = 60 %
43A
Foreign exchange fluctuation
 Asset acquired O/s India
 Loan taken in foreign currency
 Payment made actually in PY
 Amount paid – amount
recorded in books= difference  Int. payable to PFI or Banks
to add/ sub to WDV of block  Leave salary(Leave encash.)
Foreign exchange gain or loss  Payment
Except above w.r.t Debtor or
creditor to be taken as if
 Gain = PGBP income or
 Loss= deduction u/s 37(1)
44A Special provision for
deduction in case of Trade
Professional or similar
association
Deficiency allowed U/s 44A
 Deficiency = Rs. 25,000/- or
 50% of other income= 37,500
(75,000 * 50%)
WEL is allowed u/s 44A
37(1)
General deduction
 exp not allowed u/s 30 to 36
Not a Capital expenditure
Not a prior period, personal
Only for business purpose
Not contrary to prov of law
CSR exp is not allowed
 Not authorised by deed - X
 Prior period interest - X
 Max interest- 12%
40(ba) Disallowance
applicable to AOP/BOI
Fully disallowed
-Interest- Net disallowed
-Int in any capacity allowed
-Salary disallowed
43B Disallowance of unpaid
liability
 Employers Contribution to RPF  Amalgamation
or other Emp.(e) welfare fund  Partition of HUF
 Tax. Duty, cess etc.
 Bonus or commission to Emp.  Irrevocable trust
to Indian Railways
for use of railway Assets
Allowed if paid on or before
filing of ROI. Otherwise
allowed in the year paid
44AA Compulsory
maintenances of accounts
professional or similar
association
37(2B)
Contribution to political party resident without deducting tax resident without deducting tax
For expense not allowed as
deduction u/s 37
For donation, Deduction
allowed u/s 80GB, 80GGC
40(a)(1b)- Non compliance
with Equalisation levy-
Disallowed if not deducted or Allowed in PY TDS deducted
paid @ 6% before DD of RO
Ceiling limit = 1L (aggregate)
40 A(2) payment made to
relatives
 Disallowed to the extent
such expense is considered by
the Assessing officer to be
excessive or unreasonable.
No disallowance if such T/s is
at ALP
NA to domestic Transfer
pricing
Applies to Expenditure only
NA to Trade discounts
NA= Not Applicable
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43C Special provision for
computation of COA of certain
W
Assets (on T/F in case of)
 Sale consideration =
 Assets by Gift or will
COA= COA to previous owner
A
+ cost of improvement +
expenditure on transfer
C
44AB
Audit of books of accounts
Compulsory audit for
 Business- TO > 1 Cr
 Profession- TO > 50L
 44AE , BB, BBB ,ADA, AD
showing lower income than
prescribed under relevant
section
40(a)(i) Amount paid to Non-
Interest, royalty, fee for
technical services paid to
NR/FC o/s India or NR/FC in
India without deducting/
payment of TDS
100% of Exp disallowed
or Paid
40A(3) Exp not deductible
under certain if exp > 10,000
Payment of aggregate of
payment made to a person in
a day, other than the account
LD
payee cheque exceeding Rs.
10,000/- per day per person
Is Disallowed (whole amount)
 In case of Transporter the
limit is Rs. 35,000/-
Exception to this section are
R
given in Rule 6D
For Section 40A(3A) Same
limit as above
43CA Full Value of
Consideration for Transfer of
L & B Held as Stock in trade
Sale consideration
Or WEH
Stamp duty value
SDV= on the date of
agreement (if any amount
paid on or before date of
agreement) or else date of
transfer.
(refer CG Chapter)
44AD Presumptive income
other than transport business
 Indvidual(R),HUF,Firm(no LLP)
 TO shall not exceed 2 Crore
 Estimated income= 8% of
gross receipts or higher claim
 Declared income as per 44AD
in PY then bound to declare
income u/s 44AD for next 5
years. No other exp deduction
 For non cash receipt = 6%
 Can set off business loss
40(a)(ia) Amount paid to Below expenses are not 40(a)(iib) Amount paid by of
deductable royalty, licence fee
Amount paid to Resident on 40(a)(ii) Payment of IT appropriated from State Govt
which TDS Not deducted/paid 40(a)(iia) Payment of wealth Any exclusive payments in
30% of exp disallowed tax form of royalty, licence fee,
Allowed in PY TDS deducted 40(a)(iii) Payment made to service fee, privilege fee,
or Paid non-resident as salary without other charges paid to state
Palam Gas Services 2017(SC) deducing TDS- 100% govt by SG undertaking the
U/s 40(a)(1a)(/1), word 40(a)(v) Payment of taxes in same shall be disallowed.
“payable” means amount yet respect of non-monetary If levied by CG then No
to be paid or actually paid perquisites disallowance.
40A (7) 41 Taxable in PY
Provision for Gratuity Profit chargeable to tax
Is disallowed 41(1) Taxability of Recovery of Amount recovered
Except Exp & Remission & cessation
Provision for contribution to of trading liabilities
recognised fund (or) 41(2) Balance Charge Asset is sold/ Tf, SC> WDV
Actual payment (SLM method asset)
Ex. Annual premium paid to 41(3) Surplus=(SC+ Deduction- Sale took place
LIC for Gratuity- Allowed cost ) or Deduction WEL
40 A (9) 41(4A) Special Reserve When It is recovered
Contribution by employer to
41 (4) Recovery of Bad Debts When it is recovered
unrecognised/ NON Statutory
41(5) Adjustment for Loss of PY Can be adjusted against the
Fund is Disallowed
in which business is above income [41(1) to 41 (iv)]
RPF, SF, AGF or approved
discontinued in any subsequent year
pension fund – u/s 36(iv)
43D 43(1) 43(6)
Special Provision in case of Actual cost of assets WDV= Cost – Depreciation
income of PFI,public co etc
Income by way of interest  Scientific research asset Sec 50 Sec 50A
in relation to bad &  By gift, will, inheritance
for Block of SLM
doubtful debts  Second hand asset
assets method
taxable in PY in which  Reacquisition of asset
Interest received or When Block T/f of asset
 Sale & Lease back, 35 AD asset
Credited WEE ceases
 Building used for non business
Exp for acquisition of asset purpose , T/f by HC to sub co COA Op WDV WDV+ BC
full or part, paid in cash  Amalgamation, demerger + CY pur WDV- TD
exceeding 10K in a day to  Int. on borrowing, subsidy
CG Always STCG/LTCG
a person to be ignored for  Adjustment of CENVAT credit
STCG
COA u/s 43(1)  Asset by NR brought in India
44ADA Presumptive income of 44AE Presumptive income of
profession transport business
 All Resident Assessee  Any Assessee BC= Balance charge
 Gross receipts < 50Lacs  Own vehicles <= 10 goods TD= terminal Depreciation
 50% of gross receipts are carriage during PY (anytime) COA= Cost of acquisition
deemed as income U/H PGBP  Income = 7,500 PM TO= Turnover; INT= Interest
 No deduction of exp allowed Or WEH O/s = Outside
 Not required to maintain Actual Income NR= Non Residence
books of accounts FC= Foreign Company
 Not required to get audited Co= Company
Agri= Agriculture
ROI= return of Income