Section 115VV of ITA, 1961 : Section 115Vv: Limit For Charter In Of Tonnage
ITA, 1961
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Explanation using Example
Imagine a shipping company, Oceanic Liners Pvt. Ltd., has opted for the tonnage tax scheme under the Income-tax Act, 1961, which allows it to be taxed based on the net tonnage of its fleet rather than its actual income. To comply with Section 115VV, the company needs to ensure that no more than 49% of its qualifying ships' net tonnage is made up of chartered-in vessels.
During the financial year, Oceanic Liners operates a total net tonnage of 100,000. The company charters in additional ships amounting to a net tonnage of 45,000. To determi...
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