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1.If assessee pays any amount to

(a)National fund  for Rural Development

   (Set up by Central Govt)

(b) National Urban Poverty Eradication Fund

then deduction allowed under this section .

 

Note:

Direct expenditure on rural development not covered .

If deduction claimed under this section then it cannot be claimed in any other section .

 

If approval for instituition is  withdrawn,still deduction shall be available to assessee

 

 

QUESTIONS

Q1

Proft and Loss of Ajay & Co,a proprietorship  
SALES 900000
Less  
EXPENSES 800000
PROFIT 100000
Suppose Expenses Include following expenses on Rural Development  
Direct Expenditure by Assessee 50000
Donation to National Fund for Rural Development 40000
Donation to National Urban Poverty Eradication Fund 20000
Total 110000

Compute PGBP Income

-a-

Computation of PGBP Income  
Profit as per P& L A/c 100000
Add  
Expense Disallowed  
Direct Expenditure by Assessee 50000
   
Less  
Expense Allowed  
   
PGBP INCOME 150000

Direct Expenditure is disllowed for all.

-ea-

Q2

Solve last question assuming it is a company?

-a-

Answer same as last.

Direct Expenditure is disllowed even for companies

-ea-

  1. Income Tax
  2. PGBP Income
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CA Maninder Singh's photo - Expert in Practical Accounts, Taxation and Efiling
CA Maninder Singh
CA Maninder Singh is a Chartered Accountant for the past 6 years. He provides courses for Practical Accounts, Taxation and Efiling at teachoo.com .
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