Amendment of section 43B

Section 18 of the Finance Act, 1996 deals with amendment of section 43B. Amendment of section 43B. 18. In section 43B of the Income-tax Act, with effect from the 1st day of April, 1997,— (a) in clause (d), for the words "governing such loan or borrowing", the words "governing such loan or borrowing;

Amendment of section 43B.

18. In section 43B of the Income-tax Act, with effect from the 1st day of April, 1997,—

(a) in clause (d), for the words "governing such loan or borrowing", the words "governing such loan or borrowing; or" shall be substituted;

(b) after clause (d), the following clause shall be inserted, namely:—

"(e) any sum payable by the assessee as interest on any term loan from a scheduled bank in accordance with the terms and conditions of the agreement governing such loan.";

(c) after Explanation 3, the following Explanation shall be inserted, namely:—

"Explanation 3A.—For the removal of doubts, it is hereby declared that where a deduction in respect of any sum referred to in clause (e) of this section is allowed in computing the income referred to in section 28 of the previous year (being a previous year relevant to the assessment year commencing on the 1st day of April, 1996, or any earlier assessment year) in which the liability to pay such sum was incurred by the assessee, the assessee shall not be entitled to any deduction under this section in respect of such sum in computing the income of the previous year in which the sum is actually paid by him.";

(d) in Explanation 4, after clause (a), the following clause shall be inserted, namely:—

'(aa) "scheduled bank" shall have the meaning assigned to it in clause (ii) of the Explanation to clause (viia) of sub-section (1) of section 36;

[Finance (No.

2) Act, 1996]

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Section 18, The Finance Act, 1996 (Act 33 of 1996).