Grant Received

A partnership firm has received a Rs. 7 lakh grant from IIM, which has increased their profit. They are seeking advice on how to deduct this grant from their profit for Income Tax purposes. While the grant is treated as indirect income, tax cannot be saved on it as per AS. The current suggestion is to invest the grant money under Section 35 as per PGBP to claim a deduction, but they are exploring other solutions to avoid tax liability.