Tax Free Income or Exempted Incomes are also need to disclose in the Income Tax Return also. All Answers are only related to the book entry in the books of account, but the main query is different that whether to show in ITR or Not. I am fully satisfied with the answer of Mr. Sarvesh Kumar Singh that it should be disclose in the Schedule E.I. (i.e. exempted Income). It need to be disclose all type of Income whether taxable or exempt in the Income Tax Return.