UNION OF INDIA & OTHERS vs COROMANDEL FERTILIZERS LIMITED & ANR.

The Supreme Court held that under Section 80A(2) of the Income Tax Act, 1961, deductions under Chapter VIA cannot exceed the gross total income of the assessee. It clarified that Section 80J(1) allows deductions for profits from industrial undertakings, but if there are no profits, as in the case of the respondent company, no deduction can be made. The Court ruled that the Income Tax Officer's rejection of the company's request to not deduct tax at source from dividends was incorrect, as the dividends qualified for deduction under Section 80K, leading to the writ petition being allowed.