A company has ₹250 lakh of undisclosed income to which section 120 applies after a search. How much of its ₹180 lakh unabsorbed depreciation can it set off against that income?

Section 120(1) of the Income-tax Act, 2025 bars the set-off of any loss, brought forward or current, and of unabsorbed depreciation against undisclosed income included in total income as a result of a search, requisition or survey. So none of the ₹180 lakh can be set off; partial figures such as ₹70 lakh have no basis in the section.