31.  Deductions.-

(1)   In computing the income under the head "Income from other sources", the following allowances and deductions shall be made, namely:-

(a)    in the case of dividends, any sum paid by way of commission to a banking company realising such dividends on behalf of the assessee;

(b)    any expenditure (not being in the nature of capital expenditure or personal expenses of the assessee) laid out or expended wholly and exclusively for the purpose of earning such income; and

(c)    in the case of income to which clause (d) of sub-section (2) of section 30 applies, any allowance or deduction computed in accordance with the provisions of clauses (iii), (iv) and (v) of sub-section (1) of section 23.

(2)   Nothing contained in sub-section (1) shall apply-

(a)    to any such sum paid or expenditure laid out or expended which is allocable to any income exempt from tax under this Ordinance;

(b)    in computing the income by way of dividends in the case of an assessee, being a foreign company.

(3)   The provisions of section 24 shall, so far as may be, apply to the allowances and deductions under this section as they apply to the allowances and deductions in respect of income chargeable under the head "Income from business or profession".

(4)   Notwithstanding anything contained in sub-section (1) or sections 22 and 23, in the case of an assessee, being a foreign company or a foreign association, the income by way of royalty received from a Pakistani concern in pursuance of any agreement made by the foreign company or the foreign association, as the case may be, with the Pakistani concern shall be computed in such manner as may be prescribed.