Section 10C excluded from total income the profits and gains of an industrial undertaking which began to manufacture or produce any article or thing on or after 1-4-1998 in an Integrated Infrastructure Development Centre or Industrial Growth Centre located in the North-Eastern Region. The exclusion ran for ten consecutive assessment years beginning with the year in which production began. The North-Eastern Region means the States of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura.
The undertaking could not be formed by splitting up or reconstruction of an existing business, or by transfer of previously used machinery or plant.
Operative consequences
After the relevant years, depreciation and the deductions under s. 35 and s. 36(1)(ix) are treated as having been given full effect for those years (sub-section (4)(i)).
Losses relating to the relevant years could not be carried forward or set off (sub-section (4)(ii)).
No deduction under ss. 80HH, 80HHA, 80-I, 80-IA, 80-IB or 80JJA was allowed on the profits (sub-section (4)(iii)).
An assessee could opt out by a written declaration filed before the due date under s. 139(1) (sub-section (6)).
Status
The section is not operative for AY 2026-27. The proviso to sub-section (6) states that no deduction “shall be allowed to any undertaking for the assessment year beginning on the 1st day of April, 2004 and subsequent years”. The Finance Act, 2026 does not amend this section.
The 1961 Act governs AY 2026-27 and earlier assessment years; the Income-tax Act, 2025 governs tax year 2026-27 onwards. For this subject there is no provision in the Income-tax Act, 2025.
Function in the statutory architecture
Section 10C excluded from total income the profits and gains of an industrial undertaking which began to manufacture or produce any article or thing on or after 1-4-1998 in an Integrated Infrastructure Development Centre or Industrial Growth Centre located in the North-Eastern Region. The exclusion ran for ten consecutive assessment years beginning with the year in which production began. The North-Eastern Region means the States of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura.
The undertaking could not be formed by splitting up or reconstruction of an existing business, or by transfer of previously used machinery or plant.
Operative consequences
Status
The section is not operative for AY 2026-27. The proviso to sub-section (6) states that no deduction “shall be allowed to any undertaking for the assessment year beginning on the 1st day of April, 2004 and subsequent years”. The Finance Act, 2026 does not amend this section.
The 1961 Act governs AY 2026-27 and earlier assessment years; the Income-tax Act, 2025 governs tax year 2026-27 onwards. For this subject there is no provision in the Income-tax Act, 2025.