Deduction under Section 80 ID - Hotels and Convention Centres
As per the new Section 80 ID inserted by Finance Act 2007 effective from 1.4.2008, 100% of the profits from Hotels and Convention Centres will be allowed as deduction for five years, subject, of course, to certain conditions like
1.The hotel or convention centre should be located in the National Capital Territory of Delhi, Faridabad, Gurgaon, Gautam Budh Nagar or Ghaziabad.
2.The hotel is constructed and starts functioning between 1.4.2007 and 31.3.2010
3.The convention centre is constructed between 1.4.2007 and 31.3.2010
4.The deduction will not be allowed for an existing unit split or transferred to a new unit.
5.The assessee should submit along with the return an audit report in such form as prescribed.
6.The convention centres should have the minimum area and facilities as prescribed.
Now the CBDT has prescribed the audit report form and the specifications of the convention centres. A new Rule 18DE has been inserted in the Income Tax Rules. The prescribed specifications for the convention centre are that it should have a minimum covered plinth area of 25000 sq.mtrs, should have a minimum seating capacity of 3000 and should have at least 10 convention halls. In addition the facilities mandatorily required are
1. modern public address system, slide and power point projection system and LCD projector or Video screening facility. (What is a power point projection system? Power point is a Microsoft programme - the LCD projector can easily be used for this.)
2.Documentation centre with computers and printers, telephone with STD/ISD facilities, E-mail, photocopy and scanning facility along with trained operators to provide these facilities.
3. completely centrally air-conditioned.
4. adequate parking facility and other public conveniences as per the local building regulations and should also fulfill all local building regulations in respect of fire and safety.
A new form No. 1OCCBBA has been prescribed for filing the audit report.