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80 dd

Gopal Sengar (CA STUDENT) (531 Points)

05 August 2011

hi everyone

thanks for taking interest in my query

My Question is that

for deduction u/s 80DD Severe Disability 1 lac

there should be expenses of rs. 1 lac or more

Actual expenditure 40000 p.a (appx.)

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30 Replies

Shah Tarun (Student) (800 Points)
Replied 05 August 2011

Amt. of 50,000 and 1.00.000 is fixed irrespective of actual expense,So in spite of spending about 40,000 you can claim deduction of 1,00,000 in case of Sever Disability.

2 Like

CA CWA CS (ACA. Grad.CWA. LCS. B.Com) (207 Points)
Replied 05 August 2011

Dear Friend amount of 100000 is fixed irrespective of actual expenditure in case of severe disability as per sec 80 DD

1 Like

CA. Roopali Kadam (Jobs on assignment basis.) (1453 Points)
Replied 05 August 2011

Agreed with above answers

1 Like

@*CS Siddharth Bumb. * (B.Com, CA Final, CS ) (5270 Points)
Replied 05 August 2011

Originally posted by : Shah Tarun
	Amt. of 50,000 and 1.00.000 is fixed irrespective of actual expense,So in spite of spending about 40,000 you can claim deduction of 1,00,000 in case of Sever Disability.

agreed

1 Like

manoj (student) (5205 Points)
Replied 05 August 2011

Amt. of 50,000 and 1.00.000 is fixed irrespective of actual expense,So in spite of spending about 40,000 you can claim deduction of 1,00,000 in case of Sever Disability. it is notional deduction

1 Like

ROHIT CHATURVEDI (CA Final Student ) (2298 Points)
Replied 06 August 2011

agree with shah tarun

1 Like

Amol (Accounting) (432 Points)
Replied 06 August 2011

Disagree.

My Boss said, " Irrespective of expenditure" words used by T.N. Manoharan & Singhania in their books are of no relevance.(& so all above opinions) What matters before ITO is the Bare Act which clearly uses the words "incurred". Sec 80 DD deduction is not an allowance but it is a kind of reimbursement. There is difference between 80 DD & 80 U apart from the eligible claimant. If you incurred expenditure of Rs. 40,000/- How can you claim deduction of Rs.1 lakh ? specially when you don't have any bills? ITO will disallow Rs. 60,000/- in scrutiny assessment.

1 Like

Sunshine (Helping All) (10575 Points)
Replied 06 August 2011

Does the ITO have the power to supercede the IT Act?

1 Like

Sunshine (Helping All) (10575 Points)
Replied 06 August 2011

are these words "irrespective of actual expenditure" from the IT Act or created by private authors??

1 Like

Amol (Accounting) (432 Points)
Replied 06 August 2011

These words "irrespective of actual expenditure" are created by private authors , they are not from Bare Act.

1 Like

CA. Roopali Kadam (Jobs on assignment basis.) (1453 Points)
Replied 07 August 2011

incurring any expense is the criteria for the claim and not the limit. we can claim under 80DD if ANY expenditure is incurred

Bare Act wordings

Deduction in respect of maintenance including medical treatment of a dependant who is a person with disability.

80DD. (1) Where an assessee, being an individual or a Hindu undivided family, who is a resident in India, has, during the previous year,—

(a) incurred any expenditure for the medical treatment (including nursing), training and rehabilitation of a dependant, being a person with disability; or

(b) paid or deposited any amount under a scheme framed in this behalf by the Life Insurance Corporation or any other insurer or the Administrator or the specified company subject to the conditions specified in sub-section (2) and approved by the Board in this behalf for the maintenance of a dependant, being a person with disability,

the assessee shall, in accordance with and subject to the provisions of this section, be allowed a deduction of a sum of fifty thousand rupees from his gross total income in respect of the previous year: nowhere it is written : to the extent of actual expenditure incurred

Provided that where such dependant is a person with severe disability, the provisions of this sub-section shall have effect as if for the words “fifty thousand rupees”, the words “seventy-five thousand rupees” had been substituted.( plz note 50000 and 75000 has recently increased)

3 Like

CA. Roopali Kadam (Jobs on assignment basis.) (1453 Points)
Replied 07 August 2011

Therefore "irrespective of the actual expenditure" is the correct interpretation

1 Like

Amol (Accounting) (432 Points)
Replied 07 August 2011

So do you mean that Rs. 1Lakh deduction can be claimed for severe disability even if no expenditure is actually incurred at all OR just to satisfy requirement of exp. incurred even if only Re.1 exp is incurred supported by bill of Re.1?

1 Like

Amol (Accounting) (432 Points)
Replied 07 August 2011

Is there any Case Law for Sec 80 DD ?

Interpretations such as ," if 'this' is not given , that means it must be 'that' ", are very vague & not convincing. The word "incurred" in bare Act cannot be rebutted.

Sec 80 DD has some practical difficulties. Take a case where an old dependant has severe 100% disability. Say blindness. Now here further medical treatment is not possible. Nursing/Training is also not needed. He has learnt to manage his own daily chores without anybodys help.Maintenance exp are only basic needs of food ,clothing & shelter which his son provides . Now specific bills related to dependant cannot be produced because exp are met from general household exp. But Rs. 1 lakh deduction cannot be claimed because Bare Act uses the words "incurred" which is not possible to prove in absence of specific bills. Thus, the irony is that for severe 100% disability, there is no scope of incurring any medical exp & maint. exp cannot be proved & hence Rs. 1 lakh deduction is disallowed !

One of our clients, representing above case , my Boss didn't agree to the argument of '" irrespective of expenditure", & even after possessing certificate from medical officer, couldn't claim deduction & had to pay Rs. 10,000/- tax on Rs. 1 lakh disallowed.

1 Like