The following section 8ODD shall be substituted for the existing section 80DD by the Finance Act, 2003. w.e.f. 1-4-2004:
Deduction for dependents with disabilities who receive medical treatment and maintenance.
80dd income tax. (1) An assessee who is a resident of India and is an individual or Hindu undivided family has, during the previous year,
Whether the expense was covered by insurance:
(a) incurred medical expenses to treat (including nursing), train and rehabilitate a dependant with disabilities:
(b) made any payment or deposit under a scheme framed in this regard by the Life Insurance Corporation or another insurer or the Administrator or the specified company subject to the conditions specified in sub-section.
If the Board approves the expenditure for the maintenance of a dependant, a person with a disability, the assessee is entitled to deduct fifty thousand rupees from the gross total income he earned in the previous year in accordance with and subject to the provisions of this section.:
In the case of a severely disabled dependant. If the words “fifty thousand rupees” were substituted with the words “seventy-five thousand rupees,” the provisions of this sub-section will be effective.
(2)Only if the following conditions are met will the deduction be allowed under clause b) of subsection (1). Specifically:
(a ) According to clause (b) of section (1 ), in the event of death of an individual or a member of an undivided Hindu family in whose name the scheme has been subscribed, annuities or lump sum amounts can be paid to a dependent, who is a person with a disability.:
(b)Dependents may be nominated by assessees. Disabilities. The dependant may receive payments from another person or a trust on his behalf when he is a person with disabilities.
(2) Upon the decedent’s death, an amount equal to the amount paid or deposited under clause (2) will be paid to the decedent’s estate.
(b) In accordance with sub-section (1), the assessee’s income for the previous year shall be considered
As a result, the assessee is liable for tax on the amount received.
(4) Assessees claiming a deduction under this section must submit a copy of the medical authority’s certificate. A return of income under section 139 is also required in connection with the deduction claim.
With the caveat that no deduction under this section will be permitted for any assessment year relating to any prior year beginning after the expiration of the prior year during which the aforementioned certificate of disability had expired, unless a new certificate is obtained from the medical authority in the form and manner, as may he prescribed, and a co-signer is identified.