Section - 80EEB Deduction in respect of purchase of electric vehicle

This article is about deductions allowed under section 80EEB in computing the total income of an assessee.

Section - 80EEB, Income-tax Act, 1961-2020

Deduction in respect of purchase of electric vehicle.

Eligible assessee: Individual

👉Deduction allowed against interest payable on loan taken by him from any financial institution for the purpose of purchase of an electric vehicle🚗.

Maximum amount of deduction: Rs 1,50,000

Conditions to be fulfilled:

• This dedction is allowed from the assessment year beginning on the 1st day of April, 2020 and subsequent assessment years.
• Loan has been sanctioned by the financial institution during the period beginning on the 1st day of April, 2019 and ending on the 31st day of March, 2023.

Where a deduction under this section is allowed for any interest referred to in sub-section (1), deduction shall not be allowed in respect of such interest under any other provision of this Act for the same or any other assessment year.

For the purposes of this section,—

(a)  "electric vehicle" means a vehicle which is powered exclusively by an electric motor whose traction energy is supplied exclusively by traction battery installed in the vehicle and has such electric regenerative braking system, which during braking provides for the conversion of vehicle kinetic energy into electrical energy;

(b)  "financial institution" means a banking company to which the Banking Regulation Act, 1949 (10 of 1949) applies, or any bank or banking institution referred to in section 51 of that Act and includes any deposit taking non-banking financial company or a systemically important non-deposit taking non-banking financial company as defined in clauses (e) and (g) of Explanation 4 to section 43B. ]

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