Expenditure for obtaining right to use spectrum for telecommunication services

Expenditure for obtaining right to use spectrum for telecommunication services.

41. (1) For the purposes of section 52(7)(a) read with section 52(1) [Table: Sl. No. 3], the term "actually paid" shall mean,—

(a) where an assessee has opted and been allowed by the Department of Telecommunications, Government of India to make full upfront payment of spectrum fee, the actual payment of expenditure, irrespective of the tax year in which the liability for the expenditure was incurred, according to the method of accounting regularly employed by the assessee; or

(b) where an assessee has opted and been allowed by the Department of Telecommunications, Government of India to make deferred payment, the amount which would have been payable by the assessee had he opted for full upfront payment of spectrum fee, irrespective of the tax year in which the liability for the expenditure was incurred, according to the method of accounting regularly employed by the assessee.

(2) In case of deferred payment referred to in sub-rule (1)(b), where there is failure by the assessee to comply with any of the conditions specified by the scheme of the Department of Telecommunications, Government of India and the Department of Telecommunications terminates the allotment or assignment of spectrum, the Assessing Officer, in exercise of power vested in him under section 52(5), shall recompute the total income of the assessee for the tax year in which the deduction has been claimed and granted to him by deeming that—

(a) the total spectrum fee paid up to the date of termination is the amount "actually paid"; and

(b) the spectrum was in force up to the date of its termination for the purpose of determining the number of tax years as required by section 52(1) [Table: Sl. No. 3, C. D].