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CS Professional · Goods and Services Tax (GST) and Corporate Tax Planning · Corporate Tax Planning

Vardhan Infra Finance Ltd is a public company that is a financial corporation but is not a public financial institution, bank or housing finance company. Under section 32(e) of the official text, which business of such an entity qualifies as 'eligible business' for the special reserve deduction?

For any other financial corporation including a public company, eligible business is providing long-term finance for development of infrastructure facility in India. Industrial or agricultural finance is for public financial institutions, banks and similar entities, and housing finance is for housing finance companies.

  1. ALong-term finance for industrial or agricultural development
  2. BLong-term finance for construction or purchase of houses for residential purposes
  3. CLong-term finance for development of infrastructure facility in IndiaCorrect
  4. DShort-term working capital loans to any business

Explanation

For a specified entity under clause (A)(VI), being any other financial corporation including a public company, eligible business is long-term finance for development of infrastructure facility in India. Industrial or agricultural finance applies to entities in (I) to (IV), and housing finance to housing finance companies.

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