# The Finance Act, 1966, Section 17: Insertion of new sections 85B and 85C

- Act: The Finance Act, 1966 (Act 13 of 1966)
- Ministry: Ministry of Finance
- Source URL: https://indiacode.ecourtsindia.com/finance-act-1966/section/17/

## Text

Insertion of new sections 85B and 85C 17. After section 85A of the Income-tax Act, the following sections shall be inserted, namely:— Deduction of tax on dividends received from certain foreign companies '85B. Where shares in a company which is neither an Indian company nor a company which has made the prescribed arrangements for the declaration and payment of dividends within India (hereafter, in this section, referred to as the foreign company) have been allotted to an assessee, being an Indian company, in consideration of any patent, invention, model, design, secret formula or process, or similar property right, or information concerning industrial, commercial or scientific knowledge, experience or skill made available or provided or agreed to be made available or provided to the foreign company by the assessee, or in consideration of technical services rendered or agreed to be rendered to the foreign company by the assessee, under an agreement approved by the Central Government in this behalf before the 1st day of October of the relevant assessment year, and any income by way of dividend on such shares is included in the total income of the assessee, the assessee shall be entitled to a deduction from the income-tax with which it is chargeable on its total income for. the assessment year of so much of the amount of income-tax calculated at the average rate of income-tax on the income by way of dividend so included as exceeds the amount of twenty-five per cent thereof. Deduction. of tax on royalties, etc, received from certain foreign companies 85C. Where the total income of an assessee, being an Indian company, includes any income by way of royalty, commission, fees or any similar payment received by it from a company which is neither an Indian company nor a company which has made the prescribed arrangements for the declaration and payment of dividends within India (hereafter, in this section, referred to as the foreign company) in consideration for the use of any patent, invention, model, design, secret formula or process, or similar property right, or information concerning industrial, commercial or scientific knowledge, experience or skill made available or provided or agreed to be made available or provided to the foreign company by the assessee, of in consideration of technical services rendered or agreed to tee rendered to the foreign company by the assessee, under an agreement approved by the Central Government in this behalf before the 1st day of October of the relevant assessment year, the assessee shall be entitled to. a deduction from the income-tax with which it is chargeable on its total income for the assessment year of so much of the amount of income-tax calculated at the average rate of income-tax on the income so included as exceeds the amount of twenty-five per cent thereof.". [Finance Act, 1966] © Copyright. Taxmann Publications Pvt. Ltd.

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