Section 115VF of Income Tax Act "Tonnage income"
115VF. Subject to the other provisions of this Chapter, the tonnage income shall be computed in accordance with section 115VG and the income so computed shall be deemed to be the profits chargeable under the head "Profits and gains of business or profession" and the relevant shipping income referred to in sub-section (1) of section 115V-I shall not be chargeable to tax.
115VG. (1) The tonnage income of a tonnage tax company
for a previous year shall be the aggregate of the tonnage
income of each qualifying ship computed in accordance with
the provisions of sub-sections (2) and (3).
(2) For the purposes of sub-section (1), the tonnage income
of each qualifying ship shall be the daily tonnage income of
each such ship multiplied by-
(a) the number of days in the previous year; or
(b) the number of days in part of the previous year in case
the ship is operated by the company as a qualifying ship for
only part of the previous year, as the case may be.
(3) For the purposes of sub-section (2), the daily tonnage
income of a qualifying ship having tonnage referred to in
column (1) of the Table below shall be the amount specified
in the corresponding entry in column (2) of the Table:
Qualifying ship having net tonnage |
Amount of daily tonnage income |
up to 1,000 |
Rs. 70 for each 100 tons |
exceeding 1,000 but not more than 10,000 |
Rs. 700 plus Rs. 53 for each 100 tons exceeding 1,000 tons |
exceeding 10,000 but not more than 25,000 |
Rs. 5,470 plus Rs. 42 for each 100 tons exceeding 10,000 tons |
exceeding 25,000 |
Rs. 11,770 plus Rs. 29 for each 100 tons exceeding 25,000 tons. |
(4) For the purposes of this Chapter, the tonnage shall
mean the tonnage of a ship indicated in the certificate
referred to in section 115VX and includes the deemed tonnage
computed in the prescribed manner.
Explanation.-For the purposes of this sub-section, "deemed
tonnage" shall be the tonnage in respect of an arrangement
of purchase of slots, slot charter and an arrangement of
sharing of break-bulk vessel.
(5) The tonnage shall be rounded off to the nearest multiple
of hundred tons and for this purpose any tonnage consisting
of kilograms shall be ignored and thereafter if such tonnage
is not a multiple of hundred, then, if the last figure in
that amount is fifty tons or more, the tonnage shall be
increased to the next higher tonnage which is a multiple of
hundred and if the last figure is less than fifty tons, the
tonnage shall be reduced to the next lower tonnage which is
a multiple of hundred; and the tonnage so rounded off shall
be the tonnage of the ship for the purposes of this section.
(6) Notwithstanding anything contained in any other
provision of this Act, no deduction or set off shall be
allowed in computing the tonnage income under this Chapter.