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Case lawIncome-tax Act 2025Chapter IV › Section 27
Chapter IVwas s.29

Section 27 of the Income-tax Act, 2025

Section 27 — Manner of computing profits and gains of business or profession. Successor to s.29 of the 1961 Act.

Where this section sits

Section 27 is in Chapter IV — Computation of Total Income, which runs from section 13 to section 95.

← Section 26  ·  Section 28 →

What this section does

A one-line routing rule. Income referred to in section 26 — income under the head "Profits and gains of business or profession" — is to be computed as per the provisions of sections 28 to 60, with section 58 expressly excepted from that range.

Why it is there

It fixes, in one place, the closed set of provisions that do the work of computing business and professional income, so that the head has a defined computation route. Carving section 58 out of the range keeps the presumptive scheme in that section from operating as an ordinary step in that route.

Who it applies to

What this means in practice

The practical content is the exception. Sections 28 to 60 are the set from which business income is computed, and section 58 is not part of that set — so a presumptive computation under section 58 is not a step inside this method, while sections 59 and 60, on either side of it, are. The section does not say which of sections 28 to 60 apply to a given assessee, only that this is the range the computation is made from.

Where you meet this section

You never meet this section in a notice on its own. It sits behind the business income computation in a return or an assessment order, deciding which provisions may be applied to arrive at the figure.

The words themselves

shall be computed as per the provisions of sections 28 to 60, except section 58
Section 27, Income-tax Act, 2025.

What people get wrong

What this replaced

The correspondence is the Income Tax Department’s own, from its comparison utility for the 1961 and 2025 Acts. A renumbering is the easy half; whether the words changed is the half that decides cases.

See the full 1961 to 2025 concordance.

Circulars of the Board on this section

A circular binds the department, not you and not a court. Every one below was written under the 1961 Act; it reaches this section because the department’s own concordance carries the provision it names to this one.

See the circulars index.

Case law carried across

Read this before you rely on it. Every decision below was decided under the Income-tax Act, 1961. It appears here because it is tagged to a 1961 provision that the department’s own mapping carries to section 27. That is an inference we have drawn, not a holding on the new section: where the words changed in the move, the reasoning may not survive. Treat this as the place to start looking, not as authority on the 2025 Act.

Explainers

Read with

What this page does not tell you. It does not reproduce the section. Everything above was written from the section’s own text as the Income Tax Department publishes it — the text is here, and nothing here is advice on your facts. Where a figure matters, read the sub-section it comes from.