Mental disability qualifies for section 80U deduction when it substantially impairs gainful employment capacity.

Mental retardation was construed as a disability covered by section 80U where it substantially reduced the capacity to engage in gainful employment or occupation. The expression "physical" was read as bodily, and the brain and nervous system were treated as part of the human body, so mental disability was not regarded as separable from physical disability for this relief. On that construction, the statutory deduction under section 80U was held available to the assessee and the claim was allowed.

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Issues: Whether a person suffering from mental retardation is entitled to deduction under section 80U of the Income-tax Act, 1961 as a case of physical disability reducing substantially the capacity to engage in gainful employment or occupation.

Analysis: The expression "physical" was treated as meaning bodily, and the brain and nervous system were regarded as part of the human body. On that basis, mental disability was held not to be separable from physical disability where it substantially impairs the capacity to engage in gainful employment or occupation. The statutory relief under section 80U was therefore construed to cover such mental disability.

Conclusion: The assessee was entitled to deduction under section 80U, and the claim was allowed.

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