FM extends I-T sops for 3 PSU refineries

Finance minister P Chidambaram today extended the I-T exemptions that were to phased out from April 2009 to three public sector refineries and has allowed these companies to make deductions as provided under section 80-1B 9 of the IT Act. The Finance Bill of 2008 had earlier inserted a new sunset clause in the same section and disallowed companies to claim the seven-year tax break if they begin refining on or after April 1, 2009.

Chidambaram said that the three refineries under construction in Paradeep of IOC, Bina BPCL and Bhatinda HPCL-Mittal will not be able meet the April 1, 2009, deadline and 8220;it is proposed to amend the proposal to provide that such refineries would be eligible to avail of the benefit if they begin refining not later than the 31st March, 20128221;.

The finance minister also extended the tax holiday for software companies under the Software Technology Parks of India STPI scheme by a year to March 31, 2010. This will have an impact of up to 12 per cent on the net profits of an export oriented software company and BPOs.

India8217;s software exports touched Rs 1,44,000 crore in 2006-07. STPI members contributed about 95 per cent of this. The STPI scheme provides for tax exemption to export-oriented IT companies under Section 10 A. It was supposed to end in March 2009.