The Central Board of Direct Taxes (CBDT) has notified tax exemption to the Kerala State Electricity Regulatory Commission under the Income Tax Act, 1961.
Under section 10(46), any specified income arising to any notified body/authority/Board/ Trust/Commission (or a class thereof) which has been established or constituted by or under a Central, State or Provincial Act, or has been constituted by the Government or a State Government with the object of regulating or administering any activity for the benefit of the general public and is not engaged in any commercial activity and is notified by the Central Government in the Official Gazette for the purposes of this clause is exempt from tax.
As per the notification issued on Wednesday, the following specified income arising to that Commission is exempted; (a) Amount received in the form of grants and loans received from State Government of Kerala; (b) License fees under Electricity Act, 2003; (c) Petition fees under Electricity Act, 2003; and (d) Interest earned on investments made out of (a), (b) & (c) above.
“The provisions of this notification shall be effective subject to the conditions that Kerala State Electricity Regulatory Commission, – (a) shall not engage in any commercial activity; (b) activities and the nature of the specified income remain unchanged throughout the financial years; and (c) shall file returns of income in accordance with the provision of clause (g) of sub-section (4C) section 139 of the Income-tax Act, 1961,” the notification said.
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