The Central Board of Direct Taxes (CBDT) has notified exemption to the Indian Institute of Science Education and Research, Bhopal under clause (ii) of sub-section (I) of Section 35 of the Income Tax Act, 1961 (said Act).
The exemption shall be available to the Institute from the Assessment year 2018-2019 onwards in the category of ‘University, College or other Institution’, engaged in research activities, subject to the following conditions, namely:- (i) The sums paid to the approved organization shall be used to undertake scientific research; (ii) The approved organization shall carry out scientific research research through its faculty members or enrolled students; (iii) The approved organization shall maintain separate books of accounts in respect of the sums received by it for scientific research, reflect therein the amounts used for carrying out research, get such books audited by an accountant as defined in the explanation to sub-section (2) of section 288 of the said Act and furnish the report of such audit duly signed and verified by such accountant to the Commissioner of Income-tax or the Director of lncome-tax having jurisdiction over the case, by the due date of furnishing the return of income under sub-section ( 1) of section 139 of the said Act; (iv) The approved organization shall maintain a separate statement of donations received and amounts applied for scientific research, such donations shall be used exclusively for core scientific research and a copy of such statement duly certified by the auditor shall accompany the report of audit referred to above.
Section 35 was introduced with a view to encourage investment in scientific research in the country. The provision grants tax benefits on expenditure towards scientific research.
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