Deduction U/s 80C

This query is : Resolved

Vinay Gupta (Querist)
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16 December 2010 Dear Sir/Madam,

I would like to know that whether the deduction u/s 80C of the Income Tax Act in respect of Life Insurance Premium is allowable inclusive of Service Tax OR exclusive of Service Tax ?
For example, say, Mr. X pays the premium of Rs. 10,000 and L.I.C. charges 10.3% Service Tax on Rs. 10,000 i.e., Rs. 1030. Thus, Mr. X pays Rs. (10,000 + 1,030) = Rs. 11,030 in total. Now, the question is whether Mr. X will get the deduction of Rs. 10,000 only OR full deduction of Rs. 11,030 which includes Service Tax, u/s 80C of the Income Tax Act ?

Please help.

Thank you!

Regards,

Vinay Kumar Gupta.

CA Ayush Agarwal

CA Ayush Agarwal (Expert)
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16 December 2010 The Amount You paid will be Allow u/s 80C.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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16 December 2010 yes. deduction available

Vinay Gupta

Vinay Gupta (Querist)
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17 December 2010 Sir, Please be specific. Which amount Rs. 10,000 OR Rs. 11,030 ?
Also provide some reasons/explanations for the answer.
Please don't give one-liners.

Vinay Gupta

Vinay Gupta (Querist)
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17 December 2010 Sir, Please be specific. Which amount Rs. 10,000 OR Rs. 11,030 ?
Also provide some reasons/explanations for the answer.
Please don't give one-liners.

CA Ayush Agarwal

CA Ayush Agarwal (Expert)
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18 December 2010 11030 Will Be Allowed

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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20 December 2010 In section no where told inclusive of service tax or exclusive, so we need to take inclusive, so Rs.11030 will be allowed as deduction

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