Income Tax Act, 2025
Section 9: Ins. by s. 8, ibid. (w.e.f. 11981)
9. Ins. by s. 8, ibid. (w.e.f. 11981)
231
(c) to the depletion of mineral oil in the mining area in respect of the assessment year relevant to
the previous year in which commercial production is begun and for such succeeding year or years as
may be specified in the agreement;
and such allowances shall be computed and made in the manner specified in the agreement, the other
provisions of this Act being deemed for this purpose to have been modified to the extent necessary to give
effect to the terms of the agreement.
1[(2) Where the business of the assessee consisting of the prospecting for or extraction or production
of petroleum and natural gas is transferred wholly or partly or any interest in such business is transferred
in accordance with the agreement referred to in sub-section (1), subject to the provisions of the said
agreement and where the proceeds of the transfer (so far as they consist of capital sums)—
(a) are less than the expenditure incurred remaining unallowed, a deduction equal to such
expenditure remaining unallowed, as reduced by the proceeds of transfer, shall be allowed in respect
of the previous year in which such business or interest, as the case may be, is transferred;
(b) exceed the amount of the expenditure incurred remaining unallowed, so much of the excess as
does not exceed the difference between the expenditure incurred in connection with the business or to
obtain interest therein and the amount of such expenditure remaining unallowed, shall be chargeable
to income-tax as profits and gains of the business in the previous year in which the business or
interest therein, whether wholly or partly, had been transferred:
Provided that in a case where the provisions of this clause do not apply, the deduction to be allowed
for expenditure incurred remaining unallowed shall be arrived at by subtracting the proceeds of transfer
(so far as they consist of capital sums) from the expenditure remaining unallowed.
Explanation.—Where the business or interest in such business is transferred in a previous year in
which such business carried on by the assessee is no longer in existence, the provisions of this clause shall
apply as if the business is in existence in that previous year;
(c) are not less than the amount of the expenditure incurred remaining unallowed, no deduction
for such expenditure shall be allowed in respect of the previous year in which the business or interest
in such business is transferred or in respect of any subsequent year or years:
2[Provided that where in a scheme of amalgamation or demerger, the amalgamating or the
demerged company sells or otherwise transfers the business to the amalgamated or the resulting
company (being an Indian company), the provisions of this sub-section—
(i) shall not apply in the case of the amalgamating or the demerged company; and
(ii) shall, as far as may be, apply to the amalgamated or the resulting company as they would
have applied to the amalgamating or the demerged company if the latter had not transferred the
business or interest in the business.]]
3[Explanation.—For the purposes of this section, “mineral oil” includes petroleum and natural
gas.]
to the depletion of mineral oil in the mining area in respect of the assessment year relevant to
the previous year in which commercial production is begun and for such succeeding year or years as
may be specified in the agreement;
and such allowances shall be computed and made in the manner specified in the agreement, the other
provisions of this Act being deemed for this purpose to have been modified to the extent necessary to give
effect to the terms of the agreement.
1[
Where the business of the assessee consisting of the prospecting for or extraction or production
of petroleum and natural gas is transferred wholly or partly or any interest in such business is transferred
in accordance with the agreement referred to in sub-section
are less than the expenditure incurred remaining unallowed, a deduction equal to such
expenditure remaining unallowed, as reduced by the proceeds of transfer, shall be allowed in respect
of the previous year in which such business or interest, as the case may be, is transferred;
exceed the amount of the expenditure incurred remaining unallowed, so much of the excess as
does not exceed the difference between the expenditure incurred in connection with the business or to
obtain interest therein and the amount of such expenditure remaining unallowed, shall be chargeable
to income-tax as profits and gains of the business in the previous year in which the business or
interest therein, whether wholly or partly, had been transferred:
Provided that in a case where the provisions of this clause do not apply, the deduction to be allowed
for expenditure incurred remaining unallowed shall be arrived at by subtracting the proceeds of transfer
(so far as they consist of capital sums) from the expenditure remaining unallowed.
Explanation.—Where the business or interest in such business is transferred in a previous year in
which such business carried on by the assessee is no longer in existence, the provisions of this clause shall
apply as if the business is in existence in that previous year;
are not less than the amount of the expenditure incurred remaining unallowed, no deduction
for such expenditure shall be allowed in respect of the previous year in which the business or interest
in such business is transferred or in respect of any subsequent year or years:
2[Provided that where in a scheme of amalgamation or demerger, the amalgamating or the
demerged company sells or otherwise transfers the business to the amalgamated or the resulting
company (being an Indian company), the provisions of this sub-section—
shall not apply in the case of the amalgamating or the demerged company; and
shall, as far as may be, apply to the amalgamated or the resulting company as they would
have applied to the amalgamating or the demerged company if the latter had not transferred the
business or interest in the business.]]
3[Explanation.—For the purposes of this section, “mineral oil” includes petroleum and natural
gas.]