(1) For the purpose of the restrictive clause of sub-section (3) of section 56 of the Act, an entity shall not be included in computing income if it distributes dividends other than profits to any beneficiary for any of the following acts:-
(a) services provided by that body to the beneficiary, or
(b) the property owned by that body provided for the use of the beneficiary.
(2) In the case of sub-rule (1), no expenses including depreciation can be deducted in relation to such service or property.