Section 80-IA(4) of the Income Tax Act
Income-tax Act, 2025: s.138
Section 80-IA(4) falls under section 80IA of the Income-tax Act, 1961, which corresponds to section 138 (Deductions in respect of profits and gains from industrial undertakings or enterprises engaged in infrastructure development, etc) of the Income-tax Act, 2025.
Read section 138 of the 2025 Act
Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.
The decision most relied on for Section 80-IA(4) is CIT v. Shree Synthetics Ltd. (162 ITR 819), cited in 39 of the 86 judgments on BharatTax that turn on this section.
Leading authorities on Section 80-IA(4)
Expenses incurred in connection with a public issue of shares or debentures are allowable as revenue expenditure eligible for deduction under section 35D of the Income-tax Act. This includes expenses related to Qualified Institutional Buyers (QIBs).
Section 80IA(9A) applies only at the stage of allowing deduction, not at the computation stage. Combined deductions under Section 80IA and 80HHC cannot exceed the gross total income.
Unabsorbed depreciation of an amalgamating company cannot be added to the written down value of assets in the hands of the amalgamated company. The Supreme Court has dismissed a special leave petition against a High Court decision on this point, implicitly upholding this proposition.
The Supreme Court decision in CIT v. Modipon Ltd. (400 ITR 1) is authority for the treatment of PLA balance on excise duty and R&D cess, holding that such issues, when decided in favour of the assessee by the High Court and not appealed by the department to the Supreme Court, attain finality.
Expenditure incurred in connection with the extension of an undertaking or setting up a new unit by an Indian company is eligible for deduction under section 35D of the Income-tax Act.
