Section 46: Capital expenditure of specified business

Section 46: Capital expenditure of specified business · Complied AI

(6)

The provisions of this section shall apply to the specified business referred to in column B of the Table below if it commences its operations as specified in column C thereof. Table Sl. No. Nature of specified business Date of commencement of operations being on or after A B C 1. Laying and operating a cross- 1st April, 2007. country natural gas pipeline network for distribution, including storage facilities being an integral part of such network. 2. Building and operating a new hotel 1st April, 2010. of two-star or above category as classified by the Central Government. 3. Building and operating a new 1st April, 2010. hospital with at least 100 beds for patients. A B C 4. Developing and building a housing 1st April, 2010. project under a scheme for slum redevelopment or rehabilitation framed by the Central Government or a State Government, as notified by the Board, as per the guidelines as notified by the Board. Developing and building a housing 5. 1st April, 2011. project under a scheme for affordable housing framed by the Central Government or a State Government, as notified by the Board, as per the guidelines notified by the Board. 6. A new plant or a newly installed 1st April, 2011. capacity in an existing plant for production of fertilizer. 7. Setting up and operating an inland 1st April, 2012. container depot or a container freight station notified or approved under the Customs Act, 1962 (52 of 1962). 8. Bee-keeping and production of 1st April, 2012. honey and beeswax. 9. Setting up and operating a 1st April, 2012. warehousing facility for storage of sugar. 10. Laying and operating a slurry 1st April, 2014. pipeline for the transportation of iron ore. 11. Setting up and operating a semi- 1st April, 2014. conductor wafer fabrication manufacturing unit, as notified by the Board, and as per such guidelines as notified by the Board. 12. Developing, or operating and 1st April, 2017. maintaining, or developing, operating and maintaining, any infrastructure facility. 13. In all other cases. Th 1st April, 2009.

(11)

In this section,—

(a)

“associated person”, in relation to the assessee, means a person,— (i) who participates, directly or indirectly, or through one or more intermediaries in the management or control or capital of the assessee;

(ii)

who holds, directly or indirectly, shares carrying at least 26% of the voting power in the capital of the assessee;

(iii)

who appoints more than half of the board of directors or members of the governing board, or one or more executive directors or executive members of the governing board of the assessee; or (iv) who guarantees at least 10% of the total borrowings of the assessee;

(b)

“cold chain facility” means a chain of facilities for storage or transportation of agricultural and forest produce, meat and meat products, poultry, marine and dairy products, products of horticulture, floriculture and apiculture and processed food items under scientifically controlled conditions including refrigeration and other facilities necessary for the preservation of such produce;

(c)

“infrastructure facility” shall have the meaning assigned to it in the

Explanation

to section 80-IA(4) of the Income-tax Act, 1961;

(d)

“specified business” means any one or more of the following businesses:— (i) setting up and operating a cold chain facility;

(ii)

setting up and operating a warehousing facility for storage of agricultural produce;

(iii)

laying and operating a cross-country natural gas or crude or petroleum oil pipeline network for distribution, including storage facilities being an integral part of such network;

(iv)

building and operating, anywhere in India, a hotel of two star or above category as classified by the Central Government;

(v)

building and operating, anywhere in India, a hospital with at least 100 beds for patients;

(vi)

developing and building a housing project under a scheme for slum redevelopment or rehabilitation framed by the Central Government or a State Government as per the guidelines notified by the Board;

(vii)

developing and building a housing project under a scheme for affordable housing framed by the Central Government or a State Government as per the guidelines notified by the Board;

(viii)

production of fertilizer in India;

(ix)

setting up and operating an inland container depot or a container freight station notified or approved under the Customs Act, 1962;

(x)

bee-keeping and production of honey and beeswax;

(xi)

setting up and operating a warehousing facility for storage of sugar;

(xii)

laying and operating a slurry pipeline for the transportation of iron ore;

(xiii)

setting up and operating a semiconductor wafer fabrication manufacturing unit as per the guidelines notified by the Board;

(xiv)

developing, or maintaining and operating, or developing, maintaining and operating, a new infrastructure facility;

(e)

any machinery or plant which was used outside India by any person other than the assessee shall not be regarded as machinery or plant previously used for any purpose, if— (i) such machinery or plant was not, at any time before the date of the installation by the assessee, used in India;

(ii)

such machinery or plant is imported into India; and (iii) no deduction of depreciation for such machinery or plant has been allowed or is allowable under the provisions of this Act in computing the total income of any person for any period before the date of installation of the machinery or plant by the assessee;

(f)

if any machinery or plant or its part previously used for any purpose is transferred to the specified business and its total value does not exceed 20% of the total value of the machinery or plant used in such business, then the conditions specified in sub-section (3)(b) shall be deemed to be complied with;

(g)

any expenditure of capital nature shall not include any expenditure–– (i) for which the payment or aggregate of payments made to a person in a day, is not through specified banking or online mode, exceeds ten thousand rupees; or (ii) incurred on the acquisition of any land or goodwill or financial instrument.