A company deducts ₹800 lakh of income-tax in computing accounting profit, including ₹40 lakh of surcharge and ₹8 lakh of health and education cess. How much must it add back for ordinary…
Question and options
A company deducts ₹800 lakh of income-tax in computing accounting profit, including ₹40 lakh of surcharge and ₹8 lakh of health and education cess. How much must it add back for ordinary business-income computation under section 35?
₹40 lakh
₹8 lakh
₹48 lakh
₹800 lakh
Answer and explanation
Correct answer: D - ₹800 lakh
Section 35(a) of the Income-tax Act, 2025 disallows any tax paid on income and expressly includes any surcharge or cess on that tax, so the whole ₹800 lakh debited must be added back. Adding back only the surcharge and cess of ₹48 lakh treats the tax itself as deductible, which it is not.
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