Section 5(3) in Karnataka Agricultural Income-Tax Act, 1957
(3)the aggregate of all such allowances made under this Act shall, in no case, exceed the original cost to the assessee of the buildings, machinery, plant, or furniture, as the case may be;[Explanation. - For the purpose of this clause the property acquired by the assessee on hire purchase basis shall be deemed to be the property of the assessee;] [Inserted by Act 23 of 1985 w.e.f.1.4.1985](f)in respect of any such building, machinery or plant which has been sold or discarded or demolished or destroyed, the amount by which the written down value thereof exceeds the amount for which the building, machinery or plant, as the case may be, is actually sold for its scrap value:Provided that such amount is actually written off in the books of the assessee:Provided further that where the amount for which any such building, machinery or plant is sold, whether during the continuance of the agricultural operations or after the cessation thereof, exceeds the written down value, so much of the excess as does not 20 exceed the difference between the original cost and the written down value shall be deemed to be profits of the previous year in which the sale took place:Provided further that for the purposes of this clause, the original cost of a building, the written down value of which is determined in accordance with the Explanation to this section, shall be deemed to be the written down value so determined as at the date of its being brought into use for the purposes of deriving the agricultural income;(g)any interest paid in the previous year on any amount borrowed and actually spent on any capital expenditure incurred for the benefit of the land from which the agricultural income is derived;[Provided that any interest paid in the previous year on any amount borrowed and actually spent on any capital expenditure of purchase of motor car,-(a)in case of an assessee where the total extent of land under plantation crop is less than fifty acres, such interest shall be restricted to purchase of one motor car; and(b)in case of other assessees, to purchase of two motor cars.](h)where the land from which the agricultural income is derived is subject to a mortgage or other capital charge, any interest paid in the previous year in respect of such mortgage or charge;(i)any interest paid in the previous year on any debt, whether secured or not, incurred for the purpose of acquiring the land from which the agricultural income is derived:[Provided that the interest allowable under clauses (g), (h) and (i) shall be the actual interest paid on such loans or the amount calculated at the rate of interest charged by the scheduled banks on such loans whichever is less;] [Substituted by Act 23 of 1985 w.e.f.1.4.1985](j)any interest paid in the previous year on any amount borrowed and actually spent on the land on which the agricultural income is derived:Provided that the need for borrowing was bona fide having regard to assets of the assessee at the time:[Provided further that the interest allowable under this clause shall be the actual interest paid on such loan or the amount calculated at the rate of interest charged by the scheduled banks on such loan whichever is less.] [Substituted by Act 23 of 1985 w.e.f.1.4.1985](k)any expenditure (not being in the nature of capital expenditure) laid out or expended in the previous year wholly and exclusively for the purpose of deriving the agricultural income:[Provided that the following amounts shall not be deemed to be expenditure laid out or expended for the purpose of deriving the agricultural income, -(i)in the case of any firm, any payment of interest, salary, bonus, commission or remuneration made by the firm to any partner of the firm;(ii)in the case of any company, any expenditure which results directly or indirectly in the provision of any remuneration or benefit or amenity to a director or to a person who has a substantial interest in the company or to a relative of the director or of such person, as the case may be, if in the opinion of the [Assistant Commissioner of Agricultural Income-tax] any such expenditure is excessive or unreasonable having regard to the legitimate business needs of the company and the benefit derived by or accruing to it therefrom;](iii)[ any sum paid on account of wealth tax under the Wealth Tax Act, 1957 (Central Act XXVII of 1957);] [Inserted by Act 14 of 1983 w.e.f.1.4.1964][Explanation. - For the removal of doubts it is hereby declared that deductions under this clause shall not include deductions specifically provided for or allowed under other clauses of this section or rules made under this section.] [Inserted by Act 23 of 1985 w.e.f.1.10.1957](l)such other deductions as may be prescribed generally or in particular cases;(m)in the case of agricultural income under the head rent or revenue derived from land referred to in sub-clause (1) of clause (a) of section 2, -(i)any expenses actually incurred in the previous year in the collection of agricultural income;(ii)any expenses incurred in the previous year on repairs in respect of any capital asset used in connection with the collection of rents due in respect of the land from which the agricultural income is derived;(n)in the case of agricultural income referred to in sub-clause (2) of clause (a) of section 2, -(i)the expenses other than capital expenditure incurred in the previous year of raising the crop from which the agricultural income is derived and of transporting such crop to market, including the maintenance of agricultural implements and cattle required for such cultivation and transport or both;(ii)the cost incurred in the previous year in the purchase or replacement of cattle or implements, which are necessary for cultivation, to such extent as may be prescribed, less the amount realised by sale of the cattle or implements replaced or their estimated value;(iii)any sum paid in the previous year in order to effect an insurance against loss or damage of crops or property from which the agricultural income is derived:Provided that any amount received in respect of such insurance in any year shall be deemed to be agricultural income for the purposes of this Act, and shall be liable to agricultural income-tax after deducting the portion thereof, if any, which has been assessed to income-tax under the [Income-tax Act, 1961 (Central Act 43 of 1961)] [Substituted by Act 29 of 1976 w.e.f.1.4.1975];(iv)any expenses incurred in the previous year on the maintenance of any capital asset if such maintenance is required for the purpose of deriving the agricultural income:Provided that no deduction shall be made under this section if it has already been made in the assessment under the [Income-tax Act, 1961 (Central Act 43 of 1961)] [Substituted by Act 29 of 1976 w.e.f.1.4.1975].[Explanation. - For the purposes of this sub-section 'building' includes all structures constructed with a view to provide amenities to workers as defined in the Plantations Labour Act, 1951 (Central Act 69 of 1951) employed in plantations and for the purpose of deriving the agricultural income; 'relative' in relation to an individual means the husband, wife, brother or sister or any lineal ascendant or descendant, of that individual and "written down value" means, -(i)in the case of assets acquired in the previous year the actual cost to the assessee; and(ii)in the case of assets acquired before the previous year, the actual cost to the assessee less such sum as may be prescribed.]
