Income Tax Act

Official PDF pages 191–195

SOURCE PDF PAGE 191
( g )   “person with severe disability” means—
( i )   a person with 80% or more of one or more disabilities, as referred
to in section 56(4) of the Persons with Disabilities (Equal Oppor -
tunities, Protection of Rights and Full Participation) Act, 1995
(1 of 1996); or
( ii )   a person with severe disability referred to in section 2( o ) of the
National Trust for Welfare of Persons with Autism, Cerebral
Palsy, Mental Retardation and Multiple Disabilities Act, 1999
(44 of 1999);
( h )   “specified company” means a company as referred to section 2( h ) of the
Unit Trust of India (Transfer of Undertaking and Repeal) Act, 2002 (58
of 2002).
Deduction in respect of medical treatment, etc.
128.   (1) An assessee who is resident in India, shall be allowed a deduction of the
amount actually paid during the tax year or a sum of   `   40000, whichever is
less, from income chargeable to tax of that tax year, for the medical treatment of
such disease or ailment as may be prescribed—
( a )   for himself or a dependant, in case the assessee is an individual; or
( b )   for any member of a Hindu undivided family, in case the assessee is a
Hindu undivided family.
(2) A deduction shall be allowed under this section only if the assessee obtains the
prescription for the medical treatment from a neurologist, oncologist, urologist,
haematologist, immunologist, or any other specialist, as may be prescribed.
(3) The deduction under this section shall be reduced by any amount received un -
der an insurance from an insurer, or reimbursed by an employer, for the medical
treatment of the person as referred to in sub-section (1)( a ) or ( b ).
(4) If the amount actually paid is in respect of the assessee or his dependant or
any member of a Hindu undivided family of the assessee and who is senior citizen,
the amount of deduction as referred to in sub-section (1) shall be substituted with
“ `   100000” for “ `   40000”.
(5) For the purposes of this section,—
( a )   “dependant” shall have the meaning as assigned to it in section 127(9);
( b )   “insurer” shall have the meaning assigned to it in section 2( 9 ) of the
Insurance Act, 1938 (4 of 1938).
Deduction in respect of interest on loan taken for higher education.
129.   (1) An assessee, being an individual, shall be allowed a deduction of amount
paid as interest during a tax year, subject to the provisions of this section,
on a loan taken by him from any financial institution or any approved charitable
institution, if the—
( a )   loan taken is for the purpose of pursuing higher education of himself or
his relative; and
( b )   payment is made out of his income chargeable to tax.

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(2) The deduction referred to in sub-section (1) shall be allowed in computing the
total income in respect of the initial tax year and seven tax years immediately suc -
ceeding the initial tax year, or until the interest referred to in sub-section (1) is fully
paid by the assessee, whichever is earlier.
(3) For the purposes of this section,—
( a )   “approved charitable institution” means a registered non-profit organi-
sation where it was approved earlier under the provisions of section
10( 23C ) of the Income-tax Act, 1961 (43 of 1961), or an institution
referred to in section 80G(2)( a ) of the said Act;
( b )   “financial institution” means a banking company to which the Banking
Regulation Act, 1949 (10 of 1949) applies (including any bank or banking
institution referred to in section 51 of that Act) or any other financial
institution which the Central Government may, by notification, specify;
( c )   “higher education” means any course of study pursued after passing the
Senior Secondary Examination or its equivalent from a school, board, or
University recognised by the Central Government or State Government,
local authority, or by any authority authorised by the Central Government
or State Government or local authority to do so;
( d )   “initial tax year” means the tax year in which the assessee starts paying
the interest on the loan;
( e )   “relative”, in relation to an individual, means the spouse and children
of that individual, or the student for whom the individual is the legal
guardian.
Deduction in respect of interest on loan taken for residential house property.
130.   (1) An assessee, being an individual, shall be allowed a deduction of
interest payable on loan taken by him from any financial institution for the
purpose of acquisition of a residential house property as per the provisions of this
section.
(2) The deduction under sub-section (1) shall not exceed   `   50000 and shall be allowed
in computing the total income of the individual for the tax year beginning on the
1st April, 2016 and subsequent tax years.
(3) The deduction under sub-section (1) shall be subject to the following conditions:—
( a )   the loan has been sanctioned by the financial institution during the period
beginning on the 1st April, 2016 and ending on the 31st March, 2017;
( b )   the amount of loan sanctioned for acquisition of the residential house
property does not exceed thirty-five lakh rupees;
( c )   the value of residential house property does not exceed fifty lakh rupees;
and
( d )   the assessee does not own any residential house property on the date of
sanction of loan.
(4) Where a deduction under this section is allowed for any interest referred to in
sub-section (1), deduction shall not be allowed in respect of such interest under any
other provision of this Act for the same or any other tax year.

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(5) For the purposes of this section,—
( a )   “financial institution” means a banking company to which the Banking
Regulation Act, 1949 (10 of 1949) applies, or any bank or banking insti -
tution referred to in section 51 of that Act or a housing finance company;
( b )   “housing finance company” means a public company formed or registered
in India with the main object of carrying on the business of providing
long-term finance for construction or purchase of houses in India for
residential purposes.
Deduction in respect of interest on loan taken for certain house property.
131.   (1) An assessee, being an individual not eligible to claim deduction under
section 130, shall be allowed a deduction of interest payable on loan taken by
him from any financial institution for the purpose of acquisition of a residential
house property, subject to a maximum limit of   `   150000 in a tax year and on fulfil -
ment of conditions specified in sub-section (2), for the tax year beginning on the
1st April, 2019 and subsequent tax years.
(2) The conditions referred in sub-section (1) shall be the following:—
( a )   the loan has been sanctioned by the financial institution during the period
beginning on the 1st April, 2019 and ending on the 31st March, 2022;
( b )   the stamp duty value of residential house property does not exceed
forty-five lakh rupees; and
( c )   the assessee does not own any residential house property on the date of
sanction of loan.
(3) Where a deduction under this section is allowed for any interest referred to in
sub-section (1), deduction shall not be allowed in respect of such interest under any
other provision of this Act for the same or any other tax year.
(4) For the purposes of this section, the expression “financial institution” shall have
the meaning assigned to it in section 130(5)( a ).
Deduction in respect of purchase of electric vehicle.
132.   (1) An assessee, being an individual, shall be allowed a deduction of interest
payable on loan taken by him from any financial institution for the purpose
of purchase of an electric vehicle, as per the provisions of this section.
(2) The deduction under sub-section (1) shall be subject to the condition that the
loan has been sanctioned by the financial institution during the period beginning
on the 1st April, 2019 and ending on the 31st March, 2023.
(3) The deduction under sub-section (1) shall not exceed   `   150000 and shall be
allowed in computing the total income of the individual for the tax year beginning
on the 1st April, 2019 and subsequent tax years.
(4) Where a deduction under this section is allowed for any interest referred to in
sub-section (1), deduction shall not be allowed in respect of such interest under any
other provision of this Act for the same or any other tax year.
(5) For the purposes of this section,—

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( a )   “electric vehicle” means a vehicle powered exclusively by an electric motor,
whose traction energy is supplied exclusively by traction battery installed
in the vehicle and has such electric regenerative braking system, which
during braking provides for the conversion of vehicle kinetic energy into
electrical energy;
( b )   “financial institution” means a banking company to which the Banking
Regulation Act, 1949 (10 of 1949) applies, or any bank or banking insti -
tution referred to in section 51 of that Act and includes a non-banking
financial company.
Deduction in respect of donations to certain funds, charitable institutions, etc.
133.   (1) In computing the total income of an assessee, there shall be deducted,
as per and subject to the provisions of this section,—
( a )   the whole of the aggregate of the sum or the sums paid by the assessee,
in the tax year as donations to—
( i )   the National Defence Fund set up by the Central Government; or
( ii )   the Prime Minister’s National Relief Fund or the Prime Minister’s
Citizen Assistance and Relief in Emergency Situations Fund (PM
CARES FUND); or
( iii )   the Prime Minister’s Armenia Earthquake Relief Fund; or
( iv )   the Africa (Public Contributions-India) Fund; or
( v )   the National Children’s Fund; or
( vi )   the National Foundation for Communal Harmony; or
( vii )   a University or any educational institution of national eminence as
may be approved by the prescribed authority in this behalf; or
( viii )   any fund set up by the State Government of Gujarat exclusively for
providing relief to the victims of earthquake in Gujarat; or
( ix )   any   Zila Saksharta Samiti   constituted in any district under the
chairmanship of the Collector of that district for improving primary
education in villages and towns having a population up to one lakh
according to the last census of which figures are published before
the first day of the relevant tax year, in such district and for literacy
and post-literacy activities; or
( x )   the National Blood Transfusion Council or any State Blood Trans -
fusion Council which has its sole object the control, supervision,
regulation or encouragement in India of the services related to
operation and requirements of blood banks; or
( xi )   any fund set up by a State Government to provide medical relief to
the poor; or
( xii )   the Army Central Welfare Fund or the Indian Naval Benevolent
Fund or the Air Force Central Welfare Fund established by the
armed forces of the Union for the welfare of the past and present
members of such forces or their dependants; or

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( xiii )   the Andhra Pradesh Chief Minister’s Cyclone Relief Fund, 1996; or
( xiv )   the National Illness Assistance Fund; or
( xv )   the Chief Minister’s Relief Fund or the Lieutenant Governor’s Relief
Fund, if the fund meets all the following conditions:—
( A )   it is the only fund of its kind established in the State or the
Union territory;
( B )   it is under the overall control of the Chief Secretary or the
Department of Finance of the respective State or the Union
territory;
( C )   it is administered in a manner specified by the State Govern -
ment or the Lieutenant Governor; or
( xvi )   the National Sports Development Fund set up by the Central Gov -
ernment; or
( xvii )   the National Cultural Fund set up by the Central Government; or
( xviii )   the Fund for Technology Development and Application set up by
the Central Government; or
( xix )   the National Trust for Welfare of Persons with Autism, Cerebral
Palsy, Mental Retardation and Multiple Disabilities constituted
under section 3(1) of the National Trust for Welfare of Persons with
Autism, Cerebral Palsy, Mental Retardation and Multiple Disabilities
Act, 1999 (44 of 1999); or
( xx )   the Swachh Bharat Kosh, set up by the Central Government, other
than the sum spent by the assessee in pursuance of Corporate Social
Responsibility under section 135(5) of the Companies Act, 2013
(18 of 2013); or
( xxi )   the Clean Ganga Fund, set up by the Central Government, where
such assessee is a resident and such sum is other than the sum spent
by the assessee in pursuance of Corporate Social Responsibility
under section 135(5) of the Companies Act, 2013 (18 of 2013); or
( xxii )   the National Fund for Control of Drug Abuse constituted under
section 7A of the Narcotic Drugs and Psychotropic Substances Act,
1985 (61 of 1985); or
( xxiii )   the Government or to any such local authority, institution or associ -
ation as may be approved in this behalf by the Central Government,
to be utilised for the purpose of promoting family planning; or
( xxiv )   the Indian Olympic Association or any other association or insti -
tution established in India, as the Central Government may, hav -
ing regard to the guidelines issued in this behalf, by notification,
specify for the development of infrastructure for sports and games
in India or the sponsorship of sports and games in India, by an
assessee being a company;
( b )   an amount equal to 50% of the aggregate of the sums paid as donation
by an assessee during the tax year to—