Deduction in respect of Contribution to Pension Fund of LIC or any other Pension fund [Sec. 80CCC]

Eligible AssesseeIndividual
1ConditionInvestment or application of funds during the previous year
2Maximum DeductionRs. 1,00,000 in a previous year
3Special ProvisionsWithdrawal of deductions for certain premature exit from certain investments or application of funds

Deduction of a maximum amount of Rs.100,000 is allowed to an individual assessee for the amount paid or deposited by the assessee during previous year (out of his taxable income upto assessment year 2002-03) to effect or keep in force a contract for annuity plan of LIC or any other insurer for receiving pension from the fund referred to in sec. 10(23AAB). The whole of the amount received by an assessee or his nominee shall be taxable in the year in which the amount is so received. It may be mentioned that where deduction is claimed in respect of any amount paid or deposited, under this section, no rebate u/s.88 shall be allowed with reference to the same amount. However, any payment in commutation of pension received from the fund referred to in section 10(23AAB) is exempt [u/s.10(10A)(iii)].

Deduction u/s 80CCC for investment in pension funds.
Where any amount paid or deposited by the assessee has been taken into account for the purposes of this section :
(a) a rebate with reference to such amount shall not be allowed under sec 88 for any assessment year ending before the 1st day of April , 2006;
(b) a deduction with reference to such amount shall not be allowed under section 80C for any assessment year beginning on or after the 1st day of April, 2006.

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