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CS Professional · Advanced Direct Tax Laws and Practice · Computation of Total Income, Tax Liability and Filing of Returns of various Entities excluding Companies

Which statement about section 206(2) of the Income-tax Act, 2025 is correct?

An individual whose adjusted total income does not exceed Rs 20 lakh is outside the AMT provision. AMT can apply to individuals above that level who claim Chapter VIII-C deductions. Credit is carried forward for at most fifteen years and carries no interest.

  1. AAMT credit can be carried forward without any time limit
  2. BAMT never applies to an individual
  3. CAn individual with adjusted total income not exceeding Rs 20 lakh is outside the AMT provisionCorrect
  4. DAMT credit earns interest when set off

Explanation

Section 206(2)(d)(iii) excludes individuals, HUFs, AOPs and BODs with adjusted total income up to Rs 20 lakh. Credit carry forward is limited to the fifteenth succeeding tax year and no interest is payable on the credit.

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