Computation of capital base for deduction standard deduction - calculation of sur tax

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....x Act, 1964, surtax is levied on the excess of the chargeable profits over the standard deduction. The chargeable profits are computed in accordance with the provisions of the First Schedule, while the standard deduction is 10% of the capital of the company as computed in accordance with the provisions of the 2nd Schedule or Rs.2 lakhs, whichever is greater. In computing the capital base for calcu....

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....tself means the total amount of income referred to in section 5 computed in the manner laid down in the I.T.Act. When a sum is deducted from the total income, it does not find a place in the total income when it is computed. In view thereof such income would have to be held to be not includible therein. While computing the capital base, a proportionate amount will therefore, have to be excluded. ....