Section 80AC – Introduced in the Budget 2018

As per the existing provisions of Section 80AC of the Income Tax Act, no deduction would be admissible under sections 80IA, section 80IAB, section 80IB, section 80IC, section 80ID or section 80IE, unless the return of income by the assessee is furnished on or before the due date specified under Section 139(1). Other taxpayers who are claiming similar deductions do not come within the purview of Section 80AC.

With an objective of bringing uniformity in all income-based deductions, the government vide Budget 2018 has proposed that the scope of section 80AC be extended to all similar deductions which are covered under the heading “C—Deductions in respect of certain incomes” under Chapter VIA i.e from Sections 80IA to 80RRB. The impact of such an amendment shall be that no deduction would be allowed to a taxpayer under these provisions if the income-tax return is not filed on or before the due date prescribed under Section 139(1) of the Income Tax Act.

There also appears to be a misinterpretation that the proposed amendment would apply even to Section 80C i.e. to mean that the deduction under Section 80C would not be available if the return of income is not filed within the due date prescribed under Section 139(1). This is not true. As already mentioned above, the benefit of the claim of a deduction is not available only for below mentioned sections.

• Section 80IA : Deductions in respect of profits and gains from industrial undertakings or enterprises engaged in infrastructure development, etc.
• Section 80IAB : Deductions in respect of profits and gains by an undertaking or enterprise engaged in development of Special Economic Zone
• Section 80IAC : Special provision in respect of specified business.
• Section 80IB : Deduction in respect of profits and gains from certain industrial undertakings other than infrastructure development undertakings
• Section 80IBA : Deductions in respect of profits and gains from housing projects.
• Section 80IC : Special provisions in respect of certain undertakings or enterprises in certain special category States
• Section 80ID : Deduction in respect of profits and gains from business of hotels and convention centres in specified area
• Section 80IE : Special provisions in respect of certain undertakings in North-Eastern States
• Section 80JJA : Deduction in respect of profits and gains from business of collecting and processing of bio-degradable waste
• Section 80JJAA : Deduction in respect of employment of new employees
• Section 80LA : Deductions in respect of certain incomes of Offshore Banking Units and International Financial Services Centre
• Section 80M : Deduction in respect of certain inter-corporate dividends
• Section 80O : Deduction in respect of royalties, etc., from certain foreign enterprises
• Section 80P : Deduction in respect of income of co-operative societies
• Section 80PA : Deduction in respect of certain income of Producer Companies.
• Section 80Q : Deduction in respect of profits and gains from the business of publication of books
• Section 80QQA : Deduction in respect of professional income of authors of text books in Indian languages
• Section 80QQB : Deduction in respect of royalty income, etc., of authors of certain books other than text-books
• Section 80R : Deduction in respect of remuneration from certain foreign sources in the case of professors, teachers, etc.
• Section 80RR : Deduction in respect of professional income from foreign sources in certain cases
• Section 80RRA : Deduction in respect of remuneration received for services rendered outside India
• Section 80RRB : Deduction in respect of royalty on patents