Site restoration fund

When an assessee operates a business in India that entails the prospecting, extraction, or production of petroleum, natural gas, or both, and for which the Central Government has signed a contract with the assessee for the operation of the business, the assessee has, prior to the end of the prior year:-

(a) deposited any amount or amounts with the State Bank of India in a special account (hereinafter referred to as the special account in this section) maintained by the assessee with that Bank in accordance with and for the purposes specified in a plan (hereinafter referred to as the plan in this section) approved in this regard by the Government of India in the Ministry of Petroleum and Natural Gas; or

(b) placed any sum in an account (referred to as the "Site Restoration Account" from this point forward in this section) that was formed by the taxpayer in accordance with and for the purposes indicated in a plan created by the Ministry,

the assessee shall be permitted a deduction (such deduction being permitted prior to the loss, if any, carried forward from previous years being set off under section 72) of:-

(i) a sum equal to the total of the sums placed, or the amount itself;

(ii) a payment equivalent to 20% of the business's income (computed under the head "Profits and gains of business or profession" before making any deduction under this section), whatever amount is smaller.

One should know about 80g.

The deduction under this section will not be permitted for determining the income of any partners or, as applicable, members of such a business, the association of persons, or a body of individuals when the assessee is one of these.

If a deduction was made in relation to a sum placed in the special account or the Site Restoration Account pursuant to this subsection in a prior year, no deduction shall be made in relation to that sum in a subsequent prior year. With the exception that any money credited as an interest to the special account or the Site Restoration Account will be treated as a deposit.

Here is news about section 12a.

The deduction under the above subsection will not be allowed unless the accountant described in the explanation below subsection (2) of section 288 has audited the assessee's business accounts for the prior year that is relevant to the evaluation year for which the deduction is being requested, and the assessee has provided, along with his return of revenue, the report of such audit in the stipulated form 32b, duly signed and verified by a such accountant.

If the taxpayer is mandated by or pursuant to another law to have his accounts audited, it shall be adequate compliance with the provisions of this subsection if such taxpayer has the accounts of such business audited pursuant to such law and furnishes the report of the audit as mandated by such other law and a further report in the prescribed form under this subsection.

Much awaited article on 80g.