Section 49
Section 49: Site Restoration Fund deduction
Section 49 gives businesses engaged in prospecting, extracting or producing petroleum or natural gas in India - under an agreement with the Central Government - a deduction based on deposits made to a special account or site restoration account, with the detailed computation and taxation rules set out in Schedule X.
The deduction
Section 49(1) allows an assessee carrying on the business of prospecting, extracting or producing petroleum or natural gas (or both) in India, who has an agreement with the Central Government for this business, a deduction based on deposits to a special account or site restoration account, computed as per the provisions of Schedule X.
Taxation on withdrawal and asset transfer
Section 49(2) provides that any amount withdrawn or transferred from these accounts - at closure or otherwise - is charged to tax in the year of withdrawal or transfer, as per Schedule X.
Section 49(3) provides that where an asset acquired under the special scheme or deposit scheme referred to in Schedule X is sold or otherwise transferred in any tax year, that transfer is charged to tax in accordance with Schedule X.
Frequently asked questions
Who can claim the Site Restoration Fund deduction under Section 49?
Assessees carrying on the business of prospecting, extracting or producing petroleum or natural gas in India, who have an agreement with the Central Government for that business.
Where are the detailed computation rules for this deduction?
In Schedule X of the Act - Section 49 sets out the basic entitlement and the withdrawal/transfer taxation rules, while the detailed mechanics are in that Schedule.
Related sections
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