Section 80A(2) of the Income Tax Act
Income-tax Act, 2025: s.122
Section 80A(2) falls under section 80A of the Income-tax Act, 1961, which corresponds to section 122 (Deductions to be made in computing total income) of the Income-tax Act, 2025.
Read section 122 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 80A(2) is CIT v. Kotagiri Industrial Co-operative Tea Factory Ltd. (224 ITR 605), cited in 25 of the 26 judgments on BharatTax that turn on this section.
Leading authorities on Section 80A(2)
Gross total income must be computed by setting off losses, including brought-forward losses and unabsorbed depreciation, before any deductions under Chapter VI-A can be considered. Deductions under Chapter VI-A are only available if the resulting gross total income is positive.
Each industrial undertaking must be considered independently when calculating deductions under Section 80-I of the Income-tax Act, 1961, even if the assessee has multiple units and incurs losses in one unit while making profits in another.
When computing deductions under Section 80HHC, profits from the export of self-manufactured goods and trading goods cannot be considered separately if there is a loss in one, and the deduction is admissible if the overall business income is positive after set-off.
