With effect from 01.04.2017 new section 115BBF has been inserted which relates to taxation of income from Patents-
Under the section if income of an assesse includes any income from royalty in respect of a patent developed and registered in India, the income tax payable shall be sum of-
1.10% of Income by way of royalty from patent.
2.Tax on Income excluding the income from royalty from patent.
The section however states that no deduction shall be allowed to the eligible assesse in computing Income from royalty by way of Patent.
The section also states that where an eligible assessee opts for taxation of income by way of royalty in respect of a patent developed and registered in India for any previous year in accordance with the provisions of this section and the assessee offers the income for taxation for any of the five assessment years relevant to the previous year succeeding the previous year not in accordance with the provisions of this section, then, the assessee shall not be eligible to claim the benefit of the provisions of this section for five assessment years subsequent to the assessment year relevant to the previous year in which such income has not been offered to tax in accordance with the provisions of the section.