Fixed deposit of the period of five years or more
The provision of Section 80C of IT Act, 1961 whereby a deduction of upto Rs. 150,000 is allowed while computing total income of an individual or HUF in respect of the life insurance premium, contribution to Provident Fund etc. has been amended to include fixed deposit with a scheduled bank of a period of not less than five years. Accordingly, an individual or HUF shall now be entitled to deduction of upto Rs. 150,000 in case he makes a fixed deposit of the period of five years or more. This exemption shall be part of the Rs. 150,000 exemption presently available in respect of life insurance premium, contribution to PF etc.