Concessions for encouraging participation in the business of prospecting for, extraction etc., of mineral oils [Section 293A] :

With a view to encouraging the foreign companies to participate in the business of oil exploration and production, the Central Government is empowered under Section 293A to make, by a notification in the Official Gazette, an exemption, reduction in rate or other modification in respect of income-tax in favour of any class of persons specified below, if it considers it necessary or expedient so to do in the public interest namely:

(i) persons with whom the Central Government have entered into agreement for the association or participation of that Government or any person authorised by that Government in any business consisting of prospecting for, or extraction or production of minerals oils;

(ii) persons providing any services or facilities or supplying any ship, aircraft, machinery or plant (whether by way of sale or hire) in connection with any business consisting of the prospecting for or extraction or production of mineral oils carried on by that Government or any person specified by it in this behalf by notification in the Official Gazette.

The Central Government also has the power to make a modification in regard to the status in which the aforesaid class of persons or members thereof are to be assessed on their income from the said business. The term ‘status‘ has been explained to mean the category under which the assessee is assessed as ‘individual‘, ‘Hindu undivided family‘ and so on.