6. Insertion of new sections 21C, 21D. 21E, 21F and 21G of the principal enactment

“specified undertaking” in relation to a company means an undertaking carried on by such company on or after April 1, 2002, and which is engaged in infrastructure development for the generation of power, tourism, recreation, ware housing and cold storage, garbage collection or disposal, construction of houses or construction of hospitals, and the total amount invested within one year from the commencement of the undertaking is not less than rupees ten million but not exceeding rupees fifty million.

21D. The profits and income within the meaning of paragraph (a) of section 3 (other than any profits and income from the sale of capital assets) of any company which commences a new undertaking which is engaged in research and development with an investment of not less than rupees two million made within one year from the commencement of such undertaking, shall be exempt from income tax for a period of five years, reckoned from the year of assessment in which the undertaking commences to make profits or any year of assessment not later than two years, reckoned from the date on which the undertaking commences to carry on of commercial operations which ever is earlier.

For the purposes of this section “research and development” means any systematic or intensive study carried out in the field of science and technology with the object of using the results

Exemption from income tax of any company engaged in research and development.

thereof for the production or improvement of materials, devices, products, produce or process

(other than quality control of products or routine testing materials, devices, products or produce research in social sciences or humanities, routine data collection, efficiency surveys or management studies and market research or sales promotion).

21E.

under

of a company which acquires a non-performing or under performing business enterprise engaged in a specific area of activity, to rehabilitate such enterprise subject to terms approved by the

Minister and subject to adequate provision being made to meet the statutory liabilities outstanding at the time of acquisition of such enterprise, shall be exempt from income tax, for a period of three years, where the acquisition has been completed and commercial operations have commenced on or before March 31, 2004.

For the purposes of this section—

“acquires” means acquiring ownership of enterprise by becoming the owner, partner or a joint venturer ;

Exemption from income tax of any company acquiring non-performing or performing business enterprises.

“rehabilitation” means the recommencement of commercial operations of the enterprise on a sustainable basis ;

“specific area” means the manufacture of textiles, poultry, farming, fish rearing or any other area as may be determined by the Minister by Order published in the Gazette ;

“non-performing” means the failure to carry out commercial operations ;

“under performing” means the incurring of operational losses for a period not less than two consecutive years of assessment.

21F. (1) The profits and income within the meaning of paragraph (a) of section 3, (other than any profits from the sale of capital assets)

of any company which has an undertaking which is engaged in the manufacture and export of non-traditional products and undertakes expansion of its manufacturing undertaking of such products with an investment of not less than rupees ten million but not exceeding rupees one hundred million, shall be exempt from income tax for a period of two years where the full investment has been made on or before March 31, 2004, in respect of such expansion.

Exemption from income tax of any company engaged in non-traditional products for exports which undertakes expansion.

For the purposes of this section “export of non-traditional products” means the export of any goods, including deemed export of any goods within the meaning of section 49, other than goods referred to in sub-paragraph (ii) of paragraph (b) of section 52, not less than eighty percentum of the total turnover of such undertaking for any year of assessment.

21G.

from

non-goods.

For the purposes of this section “profits and income attributable to the expansion of any undertaking” means the excess of profits and income within the meaning of paragraph (a) of section 3, (other than any profits and income from the sale of capital assets) from the

Exemption from income tax of profits and income expansion of undertakings engaged in the manufacture or production of traditional exports or exportable production and manufacture of traditional exports or non-exportable goods during any year of assessment which is qualified for tax exemption over the annual average of the profits of such undertaking, such average, being computed taking into consideration the total profits for the period of three years immediately preceding the year of assessment in which such tax exemption period commenced .”.