CBDT notifies Income Tax Exemption to Real Estate Regulatory Authorities of 4 States u/s 10(46)

The Central Board of Direct Taxes (CBDT) vide notification no. S.O. 3865(E) issued on 1st September has notified the income tax exemption to the Real Estate Regulatory Authorities (RERA) of 4 different states as mentioned in the schedule (mentioned below) under Section 10(46) of the Income Tax Act, 1961.

Under the authority granted by section 10, clause (46) of the Income-tax Act, 1961, the Central Government has issued a notification designating ‘Real Estate Regulatory Authorities’ as defined in the attached schedule.

These authorities have been established by the government under section 20(1) of The Real Estate (Regulation and Development) Act, 2016, and are categorized as a specific ‘class of Authority.’ This exemption is solely for the purpose of specified income earned by these Authorities as follows:

1. Amount received as Grant-in-aid or loan/advance from Government;
2. Fee/penalty received from builders/developers, agents or any other stakeholders as per the provisions of the Real Estate (Regulation and Development) Act, 2016;
3. Interest earned on (a) & (b) above.

This notification shall be effective subject to the conditions that each of the Real Estate Regulatory Authority-

1. shall not engage in any commercial activity;
2. activities and the nature of the specified income shall remain unchanged throughout the financial years; and
3. shall file return of income in accordance with the provision of clause (g) of sub-section (4C) of section 139 of the Income-tax Act, 1961.

This notification will be considered applicable for the financial year 2022-2023, which is relevant for the assessment year 2023-2024.

SCHEDULE

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