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CS Executive · Setting Up of Business, Industrial and Labour Laws · Startups and its Registration

Kavya Foods Pvt Ltd is a DPIIT-recognised startup that has obtained the inter-ministerial board certificate. Which statement best describes the deduction it can claim for its eligible business?

The eligible startup gets a deduction of 100 percent of profits and gains from its eligible business for three consecutive years of its choice. The base is profit, not turnover, and the benefit is not a fixed amount or a 50 percent relief.

  1. A100% of profits and gains derived from the eligible business for 3 consecutive years of its choiceCorrect
  2. B50% of profits for 5 consecutive years
  3. C100% of turnover for 3 years
  4. DA flat exemption of Rs 10 lakh each year

Explanation

The deduction is 100% of profits and gains from the eligible business, not turnover, for 3 consecutive years chosen by the startup. Option B and D are not the structure of the benefit, and option C mistakes the base: turnover instead of profits.

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