Notification u/s 10(46) of the Income Tax Act, 1961 in the case of Tamil Nadu Electricity Regulatory Commission

Last updated: 09 May 2024

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The Central Government has issued a notification granting tax exemption under Section 10(46) of the Income Tax Act to the Tamil Nadu Electricity Regulatory Commission. This exemption applies to specific income sources including government grants, certain fees and penalties under the Electricity Act 2003, and interest from bank deposits. The exemption is subject to conditions, such as the commission not engaging in commercial activities and maintaining the nature of its specified income. This notification is effective retrospectively for several assessment years.

MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
NOTIFICATION
New Delhi, the 8th May, 2024

S.O. 1965(E).—In exercise of the powers conferred by clause (46) of section 10 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies for the purposes of the said clause, ‘Tamil Nadu Electricity Regulatory Commission’ (PAN AAAGT0048J), a body constituted by the Government of Tamil Nadu, in respect of the following specified income arising to that Commission, namely:

(a) Government Grants;
(b) fees levied under clause (g) of sub-section (1) of Section 86 read with Section 181 of the Electricity Act, 2003;
(c) penalties levied u/s 146 of the Electricity Act, 2003; and
(d) Interest earned on bank deposits.

2. This notification shall be effective subject to the conditions that Tamil Nadu Electricity Regulatory Commission-

(a) shall not engage in any commercial activity;
(b) activities and the nature of the specified income shall remain unchanged throughout the financial years; and
(c) 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.

3. This notification shall be deemed to have been applied for assessment years 2018-2019, 2019-2020, 2020-2021, 2021-2022 and 2022-2023 relevant for the financial years 2017-2018, 2018-2019, 2019-2020, 2020-2021 and
2021-2022 respectively.

[Notification No. 42/2024 F. No. 300196/40/2019-ITA-I]
CASTRO JAYAPRAKASH T., Under Secy.

FAQ :

The notification grants tax exemption to the Tamil Nadu Electricity Regulatory Commission on certain specified incomes under Section 10(46) of the Income Tax Act, 1961.

The exemption covers Government Grants, fees levied under clause (g) of sub-section (1) of Section 86 read with Section 181 of the Electricity Act, 2003, penalties levied u/s 146 of the Electricity Act, 2003, and interest earned on bank deposits.

Yes, the Tamil Nadu Electricity Regulatory Commission must not engage in any commercial activity, its activities and specified income nature must remain unchanged, and it must file its return of income as per the Income-tax Act.

This notification is deemed to have been applied for assessment years 2018-2019, 2019-2020, 2020-2021, 2021-2022, and 2022-2023.