Income Tax Act, 2025
Section 37: General.—(1) Any expenditure (not being expenditure of the nature described in
37. General.—(1) Any expenditure (not being expenditure of the nature described in
sections 30 to 36 1*** and not being in the nature of capital expenditure or personal expenses of the
assessee), laid out or expended wholly and exclusively for the purposes of the business or profession shall
be allowed in computing the income chargeable under the head “Profits and gains of business or
profession”.
2[ 3[Explanation 1.]—For the removal of doubts, it is hereby declared that any expenditure incurred
by an assessee for any purpose which is an offence or which is prohibited by law shall not be deemed to
have been incurred for the purpose of business or profession and no deduction or allowance shall be made
in respect of such expenditure.]
4[Explanation 2.—For the removal of doubts, it is hereby declared that for the purposes of subsection (1), any expenditure incurred by an assessee on the activities relating to corporate social
responsibility referred to in section 135 of the Companies Act, 2013 (18 of 2013) shall not be deemed to
be an expenditure incurred by the assessee for the purposes of the business or profession.]
5* * * * *
6[(2B) Notwithstanding anything contained in sub-section (1), no allowance shall be made in respect
of expenditure incurred by an assessee on advertisement in any souvenir, brochure, tract, pamphlet or the
like published by a political party.]
7* * * * *
8* * * * *
9* * * * *
38. Building, etc., partly used for business, etc., or not exclusively so used.— (1) Where a part of
any premises is used as dwelling house by the assessee,—
(a) the deduction under sub-clause (i) of clause (a) of section 30, in the case of rent, shall be such
amount as the 10[Assessing Officer] may determine having regard to the proportionate annual value of
the part used for the purpose of the business or profession, and in the case of any sum paid for repairs,
such sum as is proportionate to the part of the premises used for the purpose of the business or
profession;
(b) the deduction under clause (b) of section 30 shall be such sum as the 8[Assessing Officer] may
determine having regard to the part so used.
(2) Where any building, machinery, plant or furniture is not exclusively used for the purposes of the
business or profession, the deductions under sub-clause (ii) of clause (a) and clause (c) of section 30,
Any expenditure (not being expenditure of the nature described in
sections 30 to 36 1*** and not being in the nature of capital expenditure or personal expenses of the
assessee), laid out or expended wholly and exclusively for the purposes of the business or profession shall
be allowed in computing the income chargeable under the head “Profits and gains of business or
profession”.
2[ 3[Explanation 1.]—For the removal of doubts, it is hereby declared that any expenditure incurred
by an assessee for any purpose which is an offence or which is prohibited by law shall not be deemed to
have been incurred for the purpose of business or profession and no deduction or allowance shall be made
in respect of such expenditure.]
4[Explanation 2.—For the removal of doubts, it is hereby declared that for the purposes of subsection
Notwithstanding anything contained in sub-section
Where a part of
any premises is used as dwelling house by the assessee,—
the deduction under sub-clause
of clause
of section 30, in the case of rent, shall be such
amount as the 10[Assessing Officer] may determine having regard to the proportionate annual value of
the part used for the purpose of the business or profession, and in the case of any sum paid for repairs,
such sum as is proportionate to the part of the premises used for the purpose of the business or
profession;
the deduction under clause
of section 30 shall be such sum as the 8[Assessing Officer] may
determine having regard to the part so used.
Where any building, machinery, plant or furniture is not exclusively used for the purposes of the
business or profession, the deductions under sub-clause
of clause
and clause
of section 30,