Sections 141 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Sections 141 and 142 continue Part C of Chapter VIII, which gives deductions in respect of certain incomes. They follow the pattern of sections 138 and 139: each allows a deduction from the profits of a particular kind of business, and each ties the amount, and the number of tax years, to a section of the Income-tax Act, 1961 that the Act names, as if that Act had not been repealed. Section 141 is for businesses referred to in section 80-IB, and section 142 for developing and building housing projects or rental housing projects referred to in section 80-IBA. This article reads both as per the Income-tax Act, 2025 as amended by the Finance Act, 2026; later amendments, rules and notifications should be checked. For help with deduction claims, see our tax planning advisory.
If gross total income includes profits from a business referred to in section 80-IB (section 141) or from developing and building housing projects or rental housing projects referred to in section 80-IBA (section 142), and the assessee is eligible under the named section "as if the said Act had not been repealed", a deduction is allowed from those profits. The amount is calculated as per the named section, and the deduction is allowed only for the tax years the named section would have allowed. The 2025 Act prints no rate, no year count and no project conditions in these two sections.
The common structure
Both sections begin "In respect of any tax year, where" and then ask:
| Step | Section 141 | Section 142 |
|---|---|---|
| (a) What the gross total income includes | Profits and gains derived from any business referred to in section 80-IB of the Income-tax Act, 1961 | Profits and gains derived from the business of developing and building housing projects or rental housing projects referred to in section 80-IBA of the Income-tax Act, 1961 |
| (b) Eligibility | The assessee is eligible to claim a deduction from those profits for the tax year under the provisions of that section, as if the said Act had not been repealed | Same, by reference to section 80-IBA |
| Result | A deduction from the profits and gains derived from the business, in computing total income | Same |
| Condition (i) | The amount is calculated as per section 80-IB of the Income-tax Act, 1961 | The amount is calculated as per section 80-IBA of the Income-tax Act, 1961 |
| Condition (ii) | The deduction under the 2025 Act is allowed only for such tax years as would have been allowed under section 80-IB, as if the said Act had not been repealed | Same, by reference to section 80-IBA |
The references to the Income-tax Act, 1961 are quoted as printed. The 2025 Act does not repeat what the named sections say about which businesses and projects qualify, the percentage of the deduction, the years, or any approval needed. Those are matters in the sections the 2025 Act names, which are not in the text consulted; the reader needs to check them, and any later amendment, before a claim.
Section 141: certain industrial undertakings
Section 141 asks for a business "referred to in section 80-IB of the Income-tax Act, 1961". The heading printed in the Act is "Deduction in respect of profits and gains from certain industrial under-takings" (with a hyphen at the line break). The section itself does not describe the undertakings; it relies on the named section for that.
For each tax year:
- Check whether the gross total income includes profits and gains derived from a business of the kind referred to in section 80-IB.
- Check whether the assessee is eligible for that tax year under that section, as if the 1961 Act had not been repealed.
- Compute the amount of the deduction as that section would.
- Confirm that the tax year is one for which that section would have allowed the deduction.
Example (invented). Lakeside Components Ltd. has an undertaking whose business is of the kind referred to in the named section. In a tax year it is eligible, and the deduction computed under that section on the undertaking's profits is Rs. 15,00,000 (an assumed figure for illustration). Section 141 allows Rs. 15,00,000 in computing total income for that tax year. If the named section would not have allowed a deduction for a later tax year, section 141 allows none for that year.
Section 142: housing projects and rental housing projects
Section 142 applies where gross total income includes profits and gains derived from "the business of developing and building housing projects or rental housing projects referred to in section 80-IBA of the Income-tax Act, 1961". The text names two kinds of project: housing projects and rental housing projects. It does not define either, and it does not state any size, cost, approval or completion condition; those are for the named section.
The same two conditions apply. The deduction is calculated as per the named section and is allowed only for the tax years the named section would have allowed.
Example (invented). Hillcrest Builders Pvt. Ltd. develops and builds a housing project of the kind referred to in the named section. For a tax year it is eligible and the deduction computed under that section on the project's profits is Rs. 30,00,000 (assumed). Section 142 allows Rs. 30,00,000 for that year, only because that year is one the named section would have allowed.
How these deductions interact with others
| Point | Where it is stated |
|---|---|
| Total of all Chapter VIII deductions cannot exceed gross total income | Section 122(2); see the live note on section 122 |
| Where a deduction under section 141 or 142 (among the sections listed) is admissible in computing the total income of an association of persons or body of individuals, no deduction under the same section is made for a member's share of its income | Section 122(3), which lists sections 133, 135, 137, 138, 141, 142 and 143 |
| Deduction under section 140 bars other deductions under Part C to the extent of those profits | Section 140(12); see section 140 |
| Deduction under section 143 bars other deductions under the Chapter for the undertaking's profits | Section 143(5); see sections 143 to 145 |
Sections 141 and 142 themselves print no bar on claiming under other sections of Part C. A person with profits eligible under more than one section should read each section, including section 140(12), before claiming.
A printing point to note
The consolidated copy prints a footnote "12" in the middle of section 141, after the opening words of the conditions. The footnote records a substitution by the Finance Act, 2026 in section 140(16)(b)(ii) (the turnover limit for an eligible start-up) and not in section 141, which shows no marked amendment in the lines read.
What the text does not tell you
| Question | Where the 2025 Act's text stands |
|---|---|
| Rate or percentage of the deduction | Not printed in section 141 or 142 |
| Number of years | Not printed; the years the named section would have allowed |
| What counts as a qualifying undertaking or project | Not printed; for the named section |
| Whether an audit report is needed | Not printed in section 141 or 142 |
| Which date a project or undertaking must have started | Not printed in section 141 or 142 |
Need help with a housing or undertaking deduction?
Because the amount and years come from the sections these provisions name, the real work is checking your facts against those sections. Our tax planning advisory team can help you assemble the eligibility record and compute the claim.
Key takeaways
- Section 141 relies on section 80-IB of the Income-tax Act, 1961; section 142 on section 80-IBA, both as printed in the Act.
- The deduction amount is calculated as per the named section, and allowed only for the tax years it would have allowed.
- The 2025 Act prints no rate, number of years or project conditions in sections 141 and 142.
- Section 142 covers housing projects and rental housing projects; neither is defined in the section.
- Check the interaction with sections 122(3), 140(12) and 143(5) before claiming more than one deduction on the same profits.
Read next
- Section 140: deduction for eligible start-ups
- Sections 143–145: North-Eastern States, SEZ units and bio-degradable waste
- Sections 138–139: infrastructure undertakings and SEZ developers
- Income-tax Act 2025 Chapter VIII
Disclaimer: Based on the Income-tax Act, 2025 (30 of 2025) as amended by the Finance Act, 2026, as consulted on 2 October 2026. It explains the words of the Act only; the Income-tax Rules, 2026, notifications, circulars, later amendments and the way the tax authorities and courts apply these provisions should be checked. This article is general information, not legal advice; check the official text before acting.