Tax Exemption for Karnataka State Pollution Control Board under Section 10(46) of the Income-tax Act, 1961

MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
NOTIFICATION
New Delhi, the 2nd July, 2025

S.O. 2961(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, “Karnataka State Pollution Control Board”, Bengaluru (PAN- AAALK0537G), a Board constituted by the State Government of Karnataka under Water (Prevention and Control of Pollution) Act, 1974 (6 of 1974), in respect of the following specified income arising to the said Board, namely:

(i) Collection of Consent fees as notified by the Government of Karnataka in accordance with the Water (Prevention & Control of Pollution) Act, 1974, the Air (Prevention & Control of Pollution) Act, 1981 from Industries established in the State of Karnataka.
(ii) Collection of water and air analysis charges as notified by the Government of Karnataka in accordance with the Water (Prevention & Control of Pollution) Act, 1974, the Air (Prevention & Control of Pollution) Act, 1981 from Industries established in the State of Karnataka.
(iii) Environmental Compensation fees.
(iv) Any fees or income relevant to environment protection, water and air prevention and control of pollution shall be notified by the Government of Karnataka and the Central Pollution Control Board time to time.
(v) Grants/Subsidy/financial assistance/reimbursements by whatever name called received from the Central Government, State Government, Central Pollution Control Board or from any other Govt. agencies/departments on account of relevant activities notified the concerned Govt.department.
(vi) Interest income arising out of above.
(vii) Miscellaneous income incidental to the core-activities i.e. sale of scrap, miscellaneous income,tender application fees, liquidated damages, RTI Fees.

2. This notification shall be effective subject to the conditions that “Karnataka State Pollution Control Board”,Bengaluru (PAN AAALK0537G) –
(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 2024-2025 to 2025-2026 relevant for the financial years 2023-2024 to 2024-2025 and shall be applicable for assessment years 2026-2027 to 2028-2029 relevant for the financial years 2025-2026 to 2027-2028.

[Notification No. 71 /2025/F. No. 300196/29/2024-ITA-I]
MEENAKSHI SINGH, Dy. Secy.

Explanatory Memorandum

It is certified that no person is being adversely affected by giving retrospective effect to this notification.