CBDT Grants Income Tax Exemption for Karnataka State Horticulture Development Agency u/s 10(46) [Read Notification]
Through this notification, the CBDT granted specific income tax exemptions to the Karnataka State Horticulture Development Agency (KSHDA)
![CBDT Grants Income Tax Exemption for Karnataka State Horticulture Development Agency u/s 10(46) [Read Notification]](https://www.taxscan.in/wp-content/uploads/2025/01/CBDT-Central-Board-of-Direct-Taxes-Income-Tax-Exemption-Income-Tax-Exemption-for-Horticulture-Development-TAXSCAN.jpg "CBDT Grants Income Tax Exemption for Karnataka State Horticulture Development Agency u/s 10(46) [Read Notification]")
The Central Board of Direct Taxes ( CBDT ), under the Ministry of Finance, has issued Notification No. 5/2025, dated January 3, 2025, granting tax exemptions for the Karnataka State Horticulture Development Agency ( KSHDA ). The tax exemption applies to specific income categories of the KSHDA, including: Grants-in-aid from the Central and Karnataka State Governments. Revenue...
The Central Board of Direct Taxes ( CBDT ), under the Ministry of Finance, has issued Notification No. 5/2025, dated January 3, 2025, granting tax exemptions for the Karnataka State Horticulture Development Agency ( KSHDA ). The tax exemption applies to specific income categories of the KSHDA, including:
- Grants-in-aid from the Central and Karnataka State Governments.
- Revenue generated from horticultural activities carried out as per KSHDA’s Memorandum of Association, issued under Government Order No. AHD 88 HPP 2008 dated November 14, 2008.
- Interest earned on bank deposits.
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KSHDA is required to adhere to certain conditions to maintain this exemption:
- It must not engage in any commercial activities.
- Its income sources and activities must remain unchanged throughout the financial years.
- It must file its income tax returns in accordance with Clause (g) of Sub-section (4C) of Section 139 of the Income Tax Act.
The notification has a retrospective effect, applying to financial years 2020-2021 through 2023-2024, corresponding to assessment years 2021-2022 to 2024-2025.
An explanatory memorandum included in the notification confirms that the retrospective application does not adversely impact any individual or organization.
Background
Horticulture is a growing and important sector in Karnataka, giving farmers a better alternative to traditional farming. The state’s climate allows crops to grow throughout the year, including in drought-prone areas, providing farmers with steady income even during dry seasons.
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Farmers also gain from adding value to their produce, meeting different consumer needs, and exporting high-quality products with advanced technology. The increasing demand for fruits, vegetables, and flowers has further boosted production and floriculture in the state.
The income tax exemption for the Karnataka State Horticulture Development Agency (KSHDA) strengthens the sector for better financial support for farmers.
To Read the full text of the Order CLICK HERE
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