The Central Board of Direct Taxes (CBDT) has notified income tax exemption under Section 10(46) of the Income-tax Act, 1961 for the Baddi Barotiwala Nalagarh Development Authority’s specified income.
The exemption is applicable retrospectively for assessment years from 2014-2015 to 2018-2019.
As per the notification, the following income sources of the Authority will be tax-exempt:
- Grants received from the Central and Himachal Pradesh State Governments,
- Revenue generated under the Himachal Pradesh Town and Country Planning Act, 1977,
- Interest earned on bank deposits.
However, the exemption is subject to strict compliance with conditions laid down in the notification. The Authority must:
- Not engage in any commercial activity,
- Maintain consistency in its activities and the nature of income, and
- File its income tax return as mandated under Section 139(4C)(g) of the Income-tax Act.
The retrospective benefit will apply to financial years 2013-14 through 2017-18. Importantly, the government has clarified that granting this retrospective exemption will not adversely affect any person, as stated in the Explanatory Memorandum attached to the notification.
Notification Details
Notification No. 114/2025
Date: 14th July, 2025
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