The Statement of Profit & Loss of Kamal Private Ltd., a domestic company engaged in manufacturing, shows net profit of ₹ 1,07,00,000 for the financial year ended on 31st March, 2026, after considering following items

Computation of Income from House Property and Income from Business & Profession of Kamal Private Limited as per section 115BAA for the Assessment Year 2026-27 Particulars Amount in ₹ Amount in ₹ Amount in ₹ I Income from house property [Rental income from commercial property] Gross Annual Value / Net Annual Value Rent received has been taken as the Gross Annual Value (GAV) in the absence of information relating to Municipal Value, Fair Rent and Standard rent. 5,00,000 Less: Deduction under section 24(a) 30% of Net Annual Value (1,50,000) 3,50,000 II Profits and Gains from Business and Profession Net Profit 1,07,00,000 Add: Items debited but to be considered separately or to be disallowed B(i) Donation paid to Swachh Bharat Kosh [Not an expenditure incurred wholly and exclusively for the manufacturing business. Hence, not allowable under section 37] 85,000 B(ii) Contribution towards pension scheme of employees [Contribution towards pension scheme, referred to in section 80CCD, of employees is allowed only to the extent of 14% of salary of the employee in the P.Y. i.e., ₹ 1,40,000 being 14% of ₹ 10,00,000. Therefore, the excess contribution of ₹ 40,000 [i.e., ₹ 1,80,000 - ₹ 1,40,000] is disallowed u/s 36(1)(iva) 40,000 B(iii) Bonus to employees [Since the payment is made after the due date of filing return of income, disallowance under section 43B is attracted] 4,50,000 B(iv) Provision for income-tax (including interest of ₹ 70,000 thereon) [Not allowable as deduction. Disallowance under section 40(a)(ii) is attracted] 4,20,000 B(v) Contribution to a University approved and notified u/s 35(1)(ii) No deduction is allowed u/s 115BAA in respect of contribution to a university approved and notified u/s 35(1)(ii) 1,00,000 B(vi) Interest on loan borrowed for investing in shares of Pink Inc. [Allowability or otherwise of interest expenditure on earning dividend has to be considered separately under the head "Income from Other Sources"] 1,50,000 12,45,000 1,19,45,000 Add: Cash Payment for purchase of raw material deemed as income Add. Info. (2) [Since the provision for outstanding bill for purchase of raw material has been allowed as deduction during the P.Y.2024-25, cash payment in excess of ₹ 10,000 against such bill in the P.Y. 2025-26 would be deemed as income of P.Y.2025-26 as per section 40A(3A)] 40,000 1,19,85,000 Less: Expenditure to be allowed (1) Audit Fees relating to P.Y.2024-25 [₹ 15,000, being 30% of audit fees of ₹ 50,000 provided for in the books of account of F.Y.2024-25 would have been disallowed due to non-deduction of tax at source. Since tax has been deducted in October, 2025 and paid on 15.12.2025, the amount of ₹ 15,000 is deductible while computing business income of P.Y.2025-26]. (15,000) 1,19,70,000 Less: Items credited to statement of profit and loss, but not includible in business income A(i) Rent received from vacant land [Chargeable to tax under the head "Income from other sources"] 2,50,000 A(ii) Rent received from commercial property owned by the company [Chargeable to tax under the head "Income from house property"] 5,00,000 A(iii) Profit on sale of plot [Chargeable to tax under the head "Capital Gains"] 5,00,000 A(iv) Dividend from Pink Inc. USA [Dividend received from foreign company is taxable under the head "Income from Other Sources"] 5,00,000 (17,50,000) 1,02,20,000 Profits and gains from Business and Profession 1,02,20,000