Section 33AB of Income Tax Act "Tea development account, coffee development account and rubber development account"
33AB. (1) Where an assessee carrying on business of
growing and manufacturing tea or coffee or rubber in India
has, before the expiry of six months from the end of the
previous year or before the due date of furnishing the
return of his income, whichever is earlier,-
(a) deposited with the National Bank any amount or amounts
in an account (hereafter in this section referred to as the
special account) maintained by the assessee with that Bank
in accordance with, and for the purposes specified in, a
scheme (hereafter in this section referred to as the scheme)
approved in this behalf by the Tea Board or the Coffee Board
or the Rubber Board ; or
(b) deposited any amount in an account (hereafter in this
section referred to as the Deposit Account) opened by the
assessee in accordance with, and for the purposes specified
in, a scheme framed by the Tea Board or the Coffee Board or
the Rubber Board, as the case may be (hereafter in this
section referred to as the deposit scheme), with the
previous approval of the Central Government,
the assessee shall, subject to the provisions of this
section, be allowed a deduction (such deduction being
allowed before the loss, if any, brought forward from
earlier years is set off under section 72) of-
(a) a sum equal to the amount or the aggregate of the
amounts so deposited; or
(b) a sum equal to forty per cent of the profits of such
business (computed under the head "Profits and gains of
business or profession" before making any deduction under
this section), whichever is less :
Provided that where such assessee is a firm, or any
association of persons or any body of individuals, the
deduction under this section shall not be allowed in the
computation of the income of any partner, or as the case may
be, any member of such firm, association of persons or body
of individuals :
Provided further that where any deduction, in respect of
any amount deposited in the special account, or in the
Deposit Account, has been allowed under this sub-section in
any previous year, no deduction shall be allowed in respect
of such amount in any other previous year.
(2) The deduction under sub-section (1) shall not be
admissible unless the accounts of such business of the
assessee for the previous year relevant to the assessment
year for which the deduction is claimed have been audited by
an accountant as defined in the Explanation below
sub-section (2) of section 288 61[before the specified date
referred to in section 44AB and the assessee furnishes by
that date] the report of such audit in the prescribed form
duly signed and verified by such accountant :
Provided that in a case where the assessee is required by or
under any other law to get his accounts audited, it shall be
sufficient compliance with the provisions of this
sub-section if such assessee gets the accounts of such
business audited under such law and furnishes the report of
the audit as required under such other law and a further
report in the form prescribed under this sub-section.
(3) Any amount standing to the credit of the assessee in the
special account or the Deposit Account shall not be allowed
to be withdrawn except for the purposes specified in the
scheme or, as the case may be, in the deposit scheme or in
the circumstances specified below :-
(a) closure of business ;
(b) death of an assessee ;
(c) partition of a Hindu undivided family ;
(d) dissolution of a firm ;
(e) liquidation of a company.
(4) Notwithstanding anything contained in sub-section (3),
where any amount standing to the credit of the assessee in
the special account or in the Deposit Account is released
during any previous year by the National Bank or withdrawn
by the assessee from the Deposit Account, and such amount is
utilised for the purchase of-
(a) any machinery or plant to be installed in any office
premises or residential accommodation, including any
accommodation in the nature of a guest-house;
(b) any office appliances (not being computers);
(c) any machinery or plant, the whole of the actual cost of
which is allowed as a deduction (whether by way of
depreciation or otherwise) in computing the income
chargeable under the head "Profits and gains of business or
profession" of any one previous year;
(d) any new machinery or plant to be installed in an
industrial undertaking for the purposes of business of
construction, manufacture or production of any article or
thing specified in the list in the Eleventh Schedule,
the whole of such amount so utilised shall be deemed to be
the profits and gains of business of that previous year and
shall accordingly be chargeable to income-tax as the income
of that previous year.
(5) Where any amount, standing to the credit of the assessee
in the special account or in the Deposit Account, is
withdrawn during any previous year by the assessee in the
circumstance specified in clause (a) or clause (d) of
sub-section (3), the whole of such amount shall be deemed to
be the profits and gains of business or profession of that
previous year and shall accordingly be chargeable to
income-tax as the income of that previous year, as if the
business had not closed or, as the case may be, the firm had
not been dissolved.
(6) Where any amount standing to the credit of the assessee
in the special account or in the Deposit Account is utilised
by the assessee for the purposes of any expenditure in
connection with such business in accordance with the scheme
or the deposit scheme, such expenditure shall not be allowed
in computing the income chargeable under the head "Profits
and gains of business or profession".
(7) Where any amount, standing to the credit of the assessee
in the special account or in the Deposit Account, which is
released during any previous year by the National Bank or
which is withdrawn by the assessee from the Deposit Account
for being utilised by the assessee for the purposes of such
business in accordance with the scheme or the deposit scheme
is not so utilised, either wholly or in part, within that
previous year, the whole of such amount or, as the case may
be, part thereof which is not so utilised shall be deemed to
be profits and gains of business and accordingly chargeable
to income-tax as the income of that previous year :
Provided that this sub-section shall not apply in a case
where such amount is released during any previous year at
the closure of the account in circumstances specified in
clauses (b), (c) and (e) of sub-section (3).
(8) Where any asset acquired in accordance with the scheme
or the deposit scheme is sold or otherwise transferred in
any previous year by the assessee to any person at any time
before the expiry of eight years from the end of the
previous year in which it was acquired, such part of the
cost of such asset as is relatable to the deduction allowed
under sub-section (1) shall be deemed to be the profits and
gains of business or profession of the previous year in
which the asset is sold or otherwise transferred and shall
accordingly be chargeable to income-tax as the income of
that previous year :
Provided that nothing in this sub-section shall apply-
(i) where the asset is sold or otherwise transferred by the
assessee to Government, a local authority, a corporation
established by or under a Central, State or Provincial Act
or a Government company as defined in section 617 of the
Companies Act, 1956 (1 of 1956) ; or
(ii) where the sale or transfer of the asset is made in
connection with the succession of a firm by a company in the
business or profession carried on by the firm as a result of
which the firm sells or otherwise transfers to the company
any asset and the scheme or the deposit scheme continues to
apply to the company in the manner applicable to the firm.
Explanation.-The provisions of clause (ii) of the proviso
shall apply only where-
(i) all the properties of the firm relating to the business
or profession immediately before the succession become the
properties of the company ;
(ii) all the liabilities of the firm relating to the
business or profession immediately before the succession
become the liabilities of the company ; and
(iii) all the shareholders of the company were partners of
the firm immediately before the succession.
(9) The Central Government, if it considers necessary or
expedient so to do, may, by notification in the Official
Gazette, direct that the deduction allowable under this
section shall not be allowed after such date as may be
specified therein.
Explanation.-In this section,-
(a) "Coffee Board" means the Coffee Board constituted under
section 4 of the Coffee Act, 1942 (7 of 1942);
(aa) "National Bank" means the National Bank for Agriculture
and Rural Development established under section 3 of the
National Bank for Agriculture and Rural Development Act,
1981 (61 of 1981);
(ab) "Rubber Board" means the Rubber Board constituted under
sub-section (1) of section 4 of the Rubber Act, 1947 (24 of
1947);
(b) "Tea Board" means the Tea Board established under
section 4 of the Tea Act, 1953 (29 of 1953).
What is Development rebate? Section 33 of Income Tax Act 1961
What is Development allowance? Section 33A of Income Tax Act 1961
What is Site Restoration Fund? Section 33ABA of Income Tax Act 1961
What is Reserves for shipping business? Section 33AC of Income Tax Act 1961
What is Rehabilitation allowance? Section 33B of Income Tax Act 1961
What is Expenditure on scientific research? Section 35 of Income Tax Act 1961
What is Expenditure on know-how? Section 35AB of Income Tax Act 1961
What is Expenditure on eligible projects or schemes? Section 35AC of Income Tax Act 1961
What is Amortisation of certain preliminary expenses? Section 35D of Income Tax Act 1961