law: The Income-Tax Act, 1961
  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.]
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  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.]
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  1. The words "and section 80VV" omitted by Act 32 of 1985, s. 11 (w.e.f. 1-4-1986).
  2. Ins. by Act 21 of 1998, s. 15 (w.e.f. 1-4-1962).
  3. Explanation numbered as Explanation 1 thereof by Act 25 of 2014, s. 13 (w.e.f. 1-4-2015).
  4. Ins. by s. 13, ibid. (w.e.f. 1-4-2015).
  5. Sub-section (2) omitted by Act 26 of 1997, s. 8 (w.e.f. 1-4-1998).
  6. Ins. by Act 29 of 1978, s. 2 (w.e.f. 1-4-1979).
  7. Sub-section (3) omitted by Act 26 of 1997, s. 8 (w.e.f. 1-4-1998).
  8. Sub-sections (3A), (3B), (3C) and (3D) omitted by Act 32 of 1985, s. 11 (w.e.f. 1-4-1986).
  9. Sub-sections (4) and (5) omitted by Act 26 of 1997, s. 8 (w.e.f. 1-4-1998).