Income Tax Act, 1961
Section 7: Ins. by Act 33 of 2009, s. 30 (w.e.f. 12009).
7. Ins. by Act 33 of 2009, s. 30 (w.e.f. 12009).
8. Subs. by s. 30, ibid., for “as does not exceed ten per cent. of his salary in the previous year” (w.e.f. 12009).
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(b) in any other case, 1[twenty per cent.] of his gross total income in the previous year.]
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3[(1B) An assessee referred to in sub-section (1), shall be allowed a deduction in computation of his
total income, whether or not any deductions is allowed under sub-section (1), of the whole of the amount
paid or deposited in the previous year in his account under a pension scheme notified or as may be
notified by the Central Government, which shall not exceed fifty thousand rupees:
Provided that no deduction under this sub-section shall be allowed in respect of the amount on which
a deduction has been claimed and allowed under sub-section (1).]
(2) Where, in the case of an assessee referred to in sub-section (1), the 4[Central Government or any
other employer] makes any contribution to his account referred to in that sub-section, the assessee shall be
allowed a deduction in the computation of his total income, of the whole of the amount contributed by the
4[Central Government or any other employer] as does not exceed ten per cent of his salary in the previous
year.
(3) Where any amount standing to the credit of the assessee in his account referred to in
5[sub-section (1) or sub-section (1B)], in respect of which a deduction has been allowed 6[under those
sub-sections] or sub-section (2), together with the amount accrued thereon, if any, is received by the
assessee or his nominee, in whole or in part, in any previous year,—
(a) on account of closure or his opting out of the pension scheme referred to in
5[sub-section (1) or sub-section (1B)]; or
(b) as pension received from the annuity plan purchased or taken on such closure or opting out,
the whole of the amount referred to in clause (a) or clause (b) shall be deemed to be the income of the
assessee or his nominee, as the case may be, in the previous year in which such amount is received, and
shall accordingly be charged to tax as income of that previous year.
7[Provided that the amount received by the nominee, on the death of the assessee, under the
circumstances referred to in clause (a), shall not be deemed to be the income of the nominee.]
8[(4) Where any amount paid or deposited by the assessee has been allowed as a deduction under
5[sub-section (1) or sub-section (1B)],—
(a) no rebate with reference to such amount shall be allowed under section 88 for any assessment
year ending before the 1st day of April, 2006;
(b) no deduction with reference to such amount shall be allowed under section 80C for any
assessment year beginning on or after the 1st day of April, 2006.]
9[(5) For the purposes of this section, the assessee shall be deemed not to have received any amount in
the previous year if such amount is used for purchasing an annuity plan in the same previous year.]
Explanation.—For the purposes of this section, “salary” includes dearness allowance, if the terms of
employment so provide, but excludes all other allowances and perquisites.]
in any other case, 1[twenty per cent.] of his gross total income in the previous year.]
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3[
An assessee referred to in sub-section
Where, in the case of an assessee referred to in sub-section
Where any amount standing to the credit of the assessee in his account referred to in
5[sub-section
or sub-section
on account of closure or his opting out of the pension scheme referred to in
5[sub-section
or sub-section
as pension received from the annuity plan purchased or taken on such closure or opting out,
the whole of the amount referred to in clause
or clause
shall be deemed to be the income of the
assessee or his nominee, as the case may be, in the previous year in which such amount is received, and
shall accordingly be charged to tax as income of that previous year.
7[Provided that the amount received by the nominee, on the death of the assessee, under the
circumstances referred to in clause
Where any amount paid or deposited by the assessee has been allowed as a deduction under
5[sub-section
or sub-section
no rebate with reference to such amount shall be allowed under section 88 for any assessment
year ending before the 1st day of April, 2006;
no deduction with reference to such amount shall be allowed under section 80C for any
assessment year beginning on or after the 1st day of April, 2006.]
9[
For the purposes of this section, the assessee shall be deemed not to have received any amount in
the previous year if such amount is used for purchasing an annuity plan in the same previous year.]
Explanation.—For the purposes of this section, “salary” includes dearness allowance, if the terms of
employment so provide, but excludes all other allowances and perquisites.]