Income-tax Act,1961
Act No : 43
Section :
Deductions1
57. Deductions 1 The income chargeable under the head "Income from other sources" shall be computed after making the following deductions, namely:- (i) in the case of dividends, 2[or interest on securities], any reasonable sum paid by way of commission or remuneration to a banker or any other person for the purpose of realising such dividend 3[or interest] on behalf of the assessee; 4[(ia) in the case of income of the nature referred to in sub-clause (x) of clause (24) of section 2 which is chargeable to income-tax under the head "Income from other sources", deductions, so far as may be, in accordance with the provisions of clause (va) of sub- section (1) of section 36;] (ii) in the case of income of the nature referred to in clauses (ii) and (iii)of sub-section (2) of section 56, deductions, so far as may be, in accordance with the provisions of sub-clause (ii) of clause (a) and clause (c) of section 30, section 31, 5[sub-sections (1) 6[* * *] and (2)] of section 32 and subject to the provisions of 7[Section 38]; 8[(iia)in the case of income in the nature of family pension, a deduction of a sum equal to thirty-three and one-third per cent of such income or twelve thousand rupees, whichever is less. Explanation.-For the purposes of this clause, "family pension" means a regular monthly amount payable by the employer to a person belonging to the family of an employee in the event of his death;] --------------------------------------------------------------------- 2 Inserted by the Finance Act, 1988, w.e.f. 1-4-1989. 3 Ibid 4 Inserted by the Finance Act, 1987, w.e.f. 1-4-1988. 5 substituted for "sub-sections (1) and (2)"by the Taxation Laws (Amendment) Act, 1970, w.e.f. 1-4-1971. 6 The figure "(1A)" omitted by the Taxation Laws (Amendment & Miscellaneous Provisions) Act, 1986, w.e.f. 1-4-1988. 7 Substituted for "sections 34 and 38", ibid. 8 Inserted by the Finance Act, 1989, w.e.f. 1-4-1990. --------------------------------------------------------------------- 1.312 (iii) any other expenditure (not being in the nature of capital expenditure) laid out or expended wholly and exclusively for the purpose of making or earning such income. 1[Omitted by the Finance Act, 1994, w.e.f. 1-4-1995.] 2[Omitted by the Finance Act, 1988, w.e.f. 1-4-1989.] 1 Prior to the omission, the proviso read as under: "Provided that nothing contained in clause (i) or clause (iii) shall apply in computing the income referred to in clause (a) or clause (aa) or clause (ab) of subsection (1) of section 115A in the case of an assessee, being a foreign company." Earlier, it was substituted by the Finance (No. 2) Act, 1991, w.r.e.f. 1-4-1989. Prior to the substitution the proviso, as inserted by the Finance Act, 1976, w.e.f. 1-6-1976, read as under: "Provided that nothing contained in clause (i) or clause (iii) shall apply in computing the income by way of dividends in the case of an assessee being a foreign company." 2 Prior to the omission, the Explanation read as under: "Explanation.-For the purposes of this section and section 58, "foreign company" shall have the same meaning as in section 80B." ---------------------------------------------------------------------- 1.313 5. The Foreign Exchange Entitlement Certificate fee charged under the Ceylon Exchange Control Law is not a deductible expense under section 57(iii) since interest on the blocked accounts has already been earned before the fee was deducted. [Circular No. 156, dated 23rd December, 1974] 6. Forty per cent of the gross receipts from the commission earned by the authorised agents on the deposits secured by them for the Post Office Time Deposits should be allowed as a deduction while assessing such commission. [Letter No. 16813172, dated 4th October, 1972]
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