All expenses need to be considered in computing profits and gains of an eligible business under section 80-IA/80-1B of IT Act, 1961

RELEVANT PARAGRAPH

12. The provisions of sections 80IB/80IA are the code by themselves as they contains both substantive as well as procedural provisions. Therefore, we need to examine what these provisions prescribe to the issue of the manner of `computation of the profits and gains of the eligible business’. In this regard, the relevant sub-sections ie 80-IB(l), 80-IB(13) & 80-IA(5) of the said sections are important and they are reproduced here under for ready reference.

“Deduction in respect of profits and gains from certain industrial undertakings other than infrastructure development undertakings.

80-IB(l) Where the gross total income of an assessee includes any profits and gains derived from any business referred in sub section (3) to (11) (11 A) and (11B) (such business being hereinafter referred to as the eligible business), there shall, in accordance with and subject to the provisions of this section, be allowed, in computing the total income of the assessee, a deduction from such profits and gains of an amount equal to such percentage and for such number of assessment years as specified in this section.

80-IB(13) The provisions contained in subsection (5) and subsection (7) to (12) of section 80IA shall, so far as may be , apply to the eligible business under this section.

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