Centre Grants Income Tax Exemption to Delhi Pollution Control Committee u/s Section 10(46):

The Central Government has granted exemption to Delhi Pollution Control Committee (DPCC) from income tax under section 10(46) of the Income-tax Act, 1961. The old law, i.e. Income-tax Act, 1961 has been repealed and replaced with Income-tax Act, 2025 but the government has clarified that pending proceedings and assessment years prior to the new law would continue to be governed by the old law and such notifications would continue to be legally valid.

Under the notification, the tax exemption applies to specified income earned by the Delhi Pollution Control Committee. These include:

• Grants, subsidies and assistance received from the Central Government and the Government of the National Capital Territory of Delhi;

• Consent fees, licence fees and application fees collected under statutory mandates;

• Penalties and fines levied under environmental laws; and

  

• Interest earned on bank deposits and investments of surplus funds.

The exemption is subject to the following conditions:

• The Committee will not engage in any commercial activity;

• The activities of the Committee and the nature of its specified exempt income shall remain unchanged throughout the relevant financial years; and

• The Committee shall file its income tax returns in accordance with the provisions of Section 139(4C)(g) of the Income-tax Act, 1961.

The government has further stated that if the committee fails to comply with any of these conditions, the tax exemption may be withdrawn and penal action may be initiated under the provisions of the Income-tax Act, 1961.

The notification has been given retrospective effect and will apply to the Assessment Years 2024-25, 2025-26 and 2026-27 corresponding to the Financial Years 2023-24, 2024-25 and 2025-26.