10A. Special provision in respect of newly established 
undertakings in free trade zone, etc. 

(1) Subject to the provisions of this section, a deduction 
of such profits and gains as are derived by an undertaking 
from the export of articles or things or computer software 
for a period of ten consecutive assessment years beginning 
with the assessment year relevant to the previous year in 
which the undertaking begins to manufacture or produce such 
articles or things or computer software, as the case may 
be, shall be allowed from the total income of the 
assessee : 

Provided that where in computing the total income of the 
undertaking for any assessment year, its profits and gains 
had not been included by application of the provisions of 
this section as it stood immediately before its 
substitution by the Finance Act, 2000, the undertaking 
shall be entitled to deduction referred to in this sub-
section only for the unexpired period of the aforesaid ten 
consecutive assessment years : 

Provided further that where an undertaking initially 
located in any free trade zone or export processing zone is 
subsequently located in a special economic zone by reason 
of conversion of such free trade zone or export processing 
zone into a special economic zone, the period of ten 
consecutive assessment years referred to in this sub-
section shall be reckoned from the assessment year relevant 
to the previous year in which the undertaking began to 
manufacture or produce such articles or things or computer 
software in such free trade zone or export processing 
zone : 

Provided also that for the assessment year beginning on the 
1st day of April, 2003, the deduction under this sub-
section shall be ninety per cent of the profits and gains 
derived by an undertaking from the export of such articles 
or things or computer software:

Provided also that no deduction under this section shall be 
allowed to any undertaking for the assessment year 
beginning on the 1st day of April, 2010, and subsequent 
years. 

(1A) Notwithstanding anything contained in sub-section (1), 
the deduction, in computing the total income of an 
undertaking, which begins to manufacture or produce 
articles or things or computer software during the previous 
year relevant to any assessment year commencing on or after 
the 1st day of April, 2003, in any special economic zone, 
shall be hundred per cent of profits and gains derived from 
the export of such articles or things or computer software 
for a period of five consecutive assessment years beginning 
with the assessment year relevant to the previous year in 
which the undertaking begins to manufacture or produce such 
articles or things or computer software, as the case may 
be, and thereafter, fifty per cent of such profits and 
gains for further two assessment years.