Circular No. 531

What it does

Allows the section 80CCA deduction for amounts paid under the Life Insurance Corporation's 'Jeevan Dhara' and 'Jeevan Akshay' annuity plans in the previous year relevant to assessment year 1988-89 even where the payment was made before 6-9-1988, the date of Notification No. GSR 903(E) which specified those two plans for the purposes of the section. It records that under section 80CCA as substituted by the Finance Act, 1988 with effect from 1st April 1988, the qualifying amount is Rs. 20,000 for assessment year 1988-89 and Rs. 30,000 for later years.

Why it was issued

The notification specifying the annuity plans came after taxpayers had already paid premia during the relevant previous year, which would otherwise have put those payments outside the section.

Who it reaches

Individuals who paid under Jeevan Dhara or Jeevan Akshay for assessment year 1988-89
Assessing Officers disallowing pre-notification payments
Employers giving credit for the deduction in salary TDS

The provisions it speaks to

Left, the provision of the Income-tax Act, 1961 as the instrument itself names it. Right, the section of the Income-tax Act, 2025 that the department’s own concordance maps it to — which is where the same ground is now covered.

Under the 1961 Act	Now
s.8OCC	no counterpart recorded
s.80CCA	no counterpart recorded

The instrument, as the Board published it

The words below are the department’s own, reproduced from its published text. Where the department’s copy carried a publisher’s notes after the instrument, those are not reproduced.

510. Date of application of annuity plan of LIC
1. Section 80CCA of the Income-tax Act, 1961, as substituted by the Finance Act, 1988, with effect from 1st April, 1988, provides for a deduction, inter alia, of amounts paid to effect or keep in force a contract for such annuity plan of the Life Insurance Corporation as the Central Government may, by notification in the Official Gazette, specify. For the assessment year 1988-89, the amount qualifying for deduction is Rs. 20,000 and the subsequent assessment years, the qualifying amount is Rs. 30,000.
2. The Central Government has, by Notification No. GSR 903(E), dated 6-9-1988 specified "Jeevan Dhara" and "Jeevan Akshay" plans of the Life Insurance Corporation as annuity plans of that Corporation for the purposes of section 80CCA.
3. The Board have decided that amounts paid under the two annuity plans during the previous year relevant to the assessment year 1988-89 would be eligible for deduction under section 8OCCA even though such payments may have been made before the date of the aforesaid notification.
Circular : No. 531, dated 17-3-1989.

What to watch

The concession is confined to the two plans named in the notification; other annuity plans are not covered.
The qualifying amounts differ between assessment year 1988-89 and later years, Rs. 20,000 and Rs. 30,000 respectively.
The relief is about the timing of payment against the notification date - it does not waive any other condition of section 80CCA.
The assessment year it speaks to is long closed, and section 80CCA has since been rewritten.

Where you meet it

Only in old assessments or rectification for assessment year 1988-89 where a Jeevan Dhara or Jeevan Akshay premium was disallowed as pre-notification.

On the same provision

Other instruments in this library that name the same provision of the 1961 Act. They are not necessarily still operative, and a later one may have replaced an earlier one without saying so.

Circular No. 532 — 511. Taxability of repayment of amount from the account under National Savings Scheme to the legal heirs of assessee 17 March 1989
Notification No. 27/2025 [F. No. 370142/13/2025-TPL] / SO 1615(E) — 2 the Gazette of INDIA : Extraordinary [Part Ii—sec. 3(ii)] 4 April 2025
Notification No. 143 — Amendment of the Income-tax Rules under section 80CCA of the Income-tax Act, 1961 9 June 2003
Circular No. 629 — Financial Year 1992-93 31 July 1992
Circular No. 618 — Section 194EE l Payments in Respect of Deposits under NSS, ETC 22 November 1991
Circular No. 534 — 512. Repayment of amount on the closure of account under NSS - Taxability of 7 April 1989

← Circular No. 533 · Circular No. 532 →

A circular binds the department, not you and not a court. The Board issues a circular to its own officers. An assessee may hold the department to a circular that helps him; the department cannot hold an assessee to one that hurts him, and the Tribunal and the courts decide the law for themselves.

Source: the Income Tax Department’s own published text — its page for this instrument.

What this is