Definition of profit and gain u/s 80IC

Save Share

This query is : Resolved

TARUN BANSAL (Querist)

30 August 2009 Deduction u/s 80IC shall be out of profit and gains. Whether the profit and gains shall be calculated after deduction of depreciation u/s 32 or deduction u/s 80-IC shall be independent to the deduction u/s 32. The assessee has not charged depreciation in the books of accounts and has claimed the same in the computation of taxable income.

Since 80-IC is allowed on profit and gains. Profit and gains are specified u/s 28. 80-IC does not say that It is allowed on profit and gains calculated under the head profit and gains. It means 80-IC should be allowable on profit and gains mentioned under 28 and depreciation claim u/s 32 is independently be allowable.

CP Ram

CP Ram (Expert)

30 August 2009 Profit and gains claimed and allowed as deduction u/s 80IC shall be calculated after deduction of depreciation u/s 32.

Further, according to explanation 5 to the section 32, depreciation allowable u/s 32(1) is mandatory and therefore shall be allowed even if the assessee has not claimed the deduction in respect of depreciation in computing his total income.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now