Income Exempt from Tax

Section	Eligible Assessee	Type of Income	Limits	Conditions
10(1)	Any assessee	Agricultural Income	Entire amount	1) Only income from agriculture as defined under section 2(1A) is exempt. Income from agricultural processing is chargeable to tax. 2) Agricultural income is includible in the total income only for limited purpose of determining the tax rates at which the assessee would be taxed. 3) Agricultural income shall include income derived from sapling or seedling grown in nursery.( Explanation 3 to sec: 2(IA) of Finance Act 2008)
10(2)	Any individual, being a member of HUF	Amount received as share of income from the HUF	Entire amount	1) The exemption is subject to the provisions of Section 64(2). 2) Such sum has been received out of the income of the family 3) In case of any impartible estate, such sum has been paid out of the income of the estate belonging to the family.
10(2A)	Any assessee, being a partner of a partnership firm	Amount received as share	Entire amount	1) Exemption is allowable only if the partnership firm of which the of profits from the firm assessee is a partner is assessed as such. 2) Emoluments other than share of profit received from the firm such as remuneration, interest, etc. remain taxable subject to the provisions of section 40(b).
10(4)(i)	Any assessee, being a non-resident within the meaning of Section 6 of the Income-tax Act, 1961.	Amount received as interest or premium on redemption on specified bonds or securities	Entire amount	1) Bonds or securities must be specified by the Central Government by notification in the Official Gazette on or before 1st June, 2002. For Specified Securities Refer Notification No. S0-3331 dt. 19.10.65
10(4)(ii)	An individual, being a non- resident within the meaning of Section 2(q) of the Foreign Exchange Regulation Act, 1973	Amount received as interest on Non Resident (External)account	Entire amount	1) Vide Finance (No. 2) Act, 2004, w.e.f. 1-4-2005, the clause that of any income by way of interest paid or credited on or after 1st April, 2005 to NRE Account has been deleted and made taxable, However vide Finance Act, 2005, w.e.f. 1-4-2006 this change so made was again deleted and exemption was restored. 2) Money has been deposited in the NRE A/c in accordance with the Foreign Exchange Regulation Act, 1973
10(4B)	Non-resident individual, being a citizen of India or a person of Indian origin	Amount received as interest from prescribed savings certificates	Entire amount	1) The savings certificates must be issued before 1st June, 2002 and must be specified by Central Government by notification in the Official Gazette. 2) The savings certificates must be subscribed for in convertible foreign exchange remitted from a country outside India in accordance with provisions of Foreign Exchange Regulation Act, 1973 and any rules made thereunder.
10(5)	An individual	Amount received as leave travel concession from employer or former employer	Entire amount received or the amount actually spend for the purpose of travel whichever is less	1) The exemption is available only subject to the conditions prescribed by the Central Government in this regard. (For details refer Rule 2B of the Income-tax Rules,1962.)
10(6)(ii)	An individual, being a person who is not a citizen of India	Amount received as remuneration as an official of an embassy, high commission, legation, commission, consulate or trade representation of a foreign state	Entire amount	1) Remuneration of the corresponding Indian officials in the respective foreign state to which the assessee belongs should also be exempt from tax.
10(6)(vi)	An individual, being a person who is not a citizen of India	Amount received as remuneration as an employee of a foreign enterprise for services rendered by him during his stay in India	Entire amount	1) The foreign enterprise must not carry on any business in India 2) The stay of the assessee in India should not exceed a period of 90 days 3) The remuneration so paid is not liable to be deducted from income of employer chargeable under the Income- tax Act, 1961.
10(6)(viii)	An individual, being a person who is not a citizen of India	Amount received as salary as remuneration for services on a foreign ship	Entire amount	1) Stay in India should not exceed ninety days.
10(6)(xi)	An individual, being a person who is not a citizen of India	Amount received as remuneration by an employee of Government of a foreign state	Entire amount	1) The amount should be received in connection with training for any establishment or office owned by certain specified persons.
10(6A)	A foreign Company	Tax paid on income earned by way of Royalty or fees for technical services	Entire amount	1) Income is received from Government or Indian concern under an agreement 2) The agreement must be approved by the Central Government or must relate to matter included in industrial policy. 3) The agreement must be made before the 1st day of June, 2002.
10(6B)	A non-resident (not being a foreign company) and a foreign company.	Tax paid on income (not being salary, royalty or fees for technical services)	Entire amount	1) Income is received from Government or an Indian Concern 2) Income must be derived in pursuance of an agreement entered into by the Central Government with the government of a foreign state or an international organization. 3) The agreement must be entered into before the 1st day of June, 2002.
10(6BB)	Government of a foreign state or a foreign enterprise	Tax paid on income derived from leasing an aircraft or an aircraft engine to an Indian Company.	Entire amount	1) Income should be for leasing of aircraft or aircraft engine & not for providing spares, facilities or services w.r.t. Operation of aircraft. 2) Income must be derived in pursuance of an agreement approved by the Central Government. 3) The agreement must be entered after 31st March, 1997 but before 1st April, 1999 or entered into after 31st day of March, 2007 4) Foreign enterprise means a person who is non-resident.
10(6C)	Foreign companies notified by the Central Government.	Royalty or fees for technical services.	Entire amount	1) Income must be derived in pursuance of an agreement entered into with the Central Government 2) The agreement must be for providing services in projects connected with the security of India. 3) Services may be provided in India or outside.
10(7)	A citizen of India.	Allowances and perquisites paid or allowed outside India.	Entire amount	1) The allowances and perquisites must be paid or allowed by the Government. 2) Services must be rendered outside India.
10(8)	An individual.	Remuneration, and any other income accruing or arising outside India.	Entire amount	1) The individual must be engaged in duties in connection with any co-operative technical assistance programmes and projects. 2) The Central Government must have entered into an agreement with the Government of a foreign state for such programme or project. 3) The remuneration must be received from the Government of that foreign state. 4) The individual must be required to pay Income tax or social security tax to the Government of the foreign state, in respect of any other income.
10(8A)	1) Individuals who are either not ordinarily resident or are not citizens of India. 2) Any other person who is non resident	Any remuneration, fee, and any other income accruing or arising outside India.	Entire amount	1) Remuneration or fee must be received from an international organization. 2) There must be a technical assistance grant agreement between the organization and the Government of a foreign state. 3) The individual must be required to pay Income tax or social security tax to the Government of the foreign state, in respect of any other income. 4) The individual must be engaged by the organization for rendering technical services in India in connection with any technical assistance programme or project. 5) The technical assistance must be in accordance with an agreement entered into by the Central Government and the organization. 6) The Additional Secretary, Department of Economic Affairs in Ministry of Finance, should approve the agreement relating to the engagement of the individual in concurrence with Member (Income-tax) CBDT.
10(8B)	An individual who is either not a citizen of India or is not ordinarily resident in India.	Remuneration for services rendered in India and any other income accruing or arising outside India.	Entire amount	1) Remuneration must be received from the individual referred to in 10(8A) above. 2) The individual must be required to pay Income tax or social security tax to the Government of the foreign state, in respect of any other income. 3) The Additional Secretary, Department of Economic Affairs in Ministry of Finance, should approve the contract of service of the individual in concurrence with Member (Income-tax) CBDT
10(9)	Member of the family of the individual mentioned in sections 10(8), 10(8A),10(8B)	Any income accruing or arising outside India.	Entire amount	1) The individual must be a member of the family of the individual mentioned in 10(8), 10(8A), 10(8B). 2) The individual must be required to pay Income tax or social security tax to the Government of the foreign state, in respect of any other income.
10(10)	An individual	Gratuity.	As per conditions specified in section	As per conditions specified in the Section [For details Refer to the Salary Section]
10(10A)	An individual	Commuted pension	As per conditions specified in the section	As per conditions specified in the Section [For details Refer to Salary Section]
10(10AA)	An individual	Leave encashment specified in the section.	As per conditions	As per conditions specified in the Section [For details Refer to Salary Section]
10(10B)	An individual	Compensation	Lesser of (i) an amount calculated as per section 25F(b) of the Industrial Disputes Act, 1947 or (ii) Rs. 5,00,000 or (iii) actual amount received.	1) The limits do not apply to any compensation received in accordance with any scheme of the Central Government. (For details refer to Salary Section)
10(10BB)	Any assessee	Amounts received under the Bhopal Gas Leak Disaster (Processing of Claims) Act, 1985.	Entire amount	1) If the assessee has been allowed a deduction on account of any loss or damage caused by the disaster, amounts up to such loss or damage will not be exempt.
10(10BC)	Individual or his legal heir	Compensation from Central Government, State Government or Local authorities on Account of any disaster.	No limit	Exemption not allowed on the amount allowed as deduction under any other section under the Income-tax Act on account of loss or damage caused by such disaster.
10(10C)	An individual	Compensation for voluntary retirement	Maximum of Rs. 5,00,000.	1) The scheme of voluntary retirement should be framed as per Rule 2BA of the Income Tax Rules.( for Details refer to Salary Section)
10(10CC)	An individual	Tax on non-monetary perquisites paid by the employer	Entire amount.	1) Tax can be paid by the employer notwithstanding section 200 of the Companies Act.
10(10D)	An individual	Sum received under a life insurance policy including the sum allocated by way of bonus on such policy.	Entire amount	The following sums are not exempt: 1) Any sum received under S. 80DD(3) or S. 80DDA(3) 2) Any sum received under a Keyman insurance policy. 3) Any sum received under an insurance policy issued on or 1-4-2003 where premium payable for any of the years after after exceeds 20% of the actual capital sum assured unless such sum is received on death of a person. Moreover for the purpose of this section “Actual Capital Sum Assured” shall be calculated in a manner provided in Explanation to section 88(2A) or 80C(3).
10(11)	An individual	Payments received from a provident fund.	Entire amounts	The provident fund should fall within the purview of the Provident Funds Act, 1925 or should be set up and notified by the Central Government. Refer Notification No. S0 – 2430 dt. 2.7.68
10(12)	An individual	Accumulated balance in a recognized provident fund	To the extent provided in rule 8 of Part of the Fourth Schedule of the Income-tax Act.	Employee has rendered 5 or more years of service or termination of service is due to ill-health or closure of business by employer or the balance is transferred from one recognized P.F. to another recognized P.C.
10(13)	An individual	Any payments received from an approved superannuation fund.	Entire amount made-—	The payments from the approved superannuation fund should be 1. On the death of a beneficiary or, 2. By way of refund of contribution on the death of beneficiary or, 3. To an employee in lieu or in commutation of an annuity on his retirement at or after a specified age or on his becoming incapacitated prior to such retirement or, 4. By way of refund of contributions to an employee on his leaving the service in connection with which the fund is established otherwise than by retirement at or after a specified age or on his becoming incapacitated prior to such retirement, to the extent to which such payment does not exceed the contributions made prior to the commencement of this Act and any interest thereon.
10(13A)	An individual	House rent allowance	As per rule 2A	As per rule 2A
10(14)	An individual	Prescribed allowances	As per rule 2BB.	For Details refer to Salary Section
10(15)		Interest, premium on redemption and other payments on securities, bonds, annuity certificates, saving certificates and notified deposits.	Entire amount
10(15A)	Government of a foreign state or a foreign enterprise	Income derived from leasing an aircraft or an aircraft engine to an Indian Company.	Entire amount	1) Income should be earned in pursuance of an agreement approved by the Central government. 2) Exemption is not available in case of agreement entered into between 1st April, 1997 and 31st March, 1999. 3) Exemption is not available in case of agreement entered into on or after 1st April 2007
10(16)	An individual	Scholarships	Entire amount	Scholarships should be received to meet the cost of education.
10(17)	A Member of Parliament or of any State Legislature or of any Committee thereof.	Prescribed Allowances	Entire amount	Amendment: Under the amendment provided in Finance Bill 2006 the Pattern of exemptions will be as follows: 1) Daily Allowance – Fully exempt for Member of Parliament as well as for Members of State Legislature 2) Constituency Allowance – Fully exempt for Member of Parliament as well as for Members of State Legislature 3) Any Allowance – Fully exempt for Member of Parliament as well as for Members of State Legislature
10(17A)	Any assessee	Awards received in cash or kind.	Entire amount	The award should have been instituted by the Central or State Government, or by any other body and approved by the Central Government.
10(18)	Central or State Government employee.	Pension/ Family Pension	Entire amount	1) The individual should have been awarded the “Param Vir Chakra” or the “Maha Vir Chakra” or the “Vir Chakra” or such other gallantry award as notified.
10(19)	Widow or children or nominated heirs of the armed forces of the union	Family pension	Entire amount	Subject to such conditions as may be prescribed. w.e.f. 1-4-2005.
10(19A)	An individual	Annual value of a palace in the occupation of a ruler.	Entire amount.	1) The annual value should have been exempted before by virtue of the provisions of the merged States (Taxation Concessions) Order, 1949 or the Part B States (Taxation Concessions) Order, 1950 or the Jammu & Kashmir (Taxation Concessions) Order, 1958.
10(20)	A local authority	Income from House Property, Capital gains or Income from other sources or income of specified trade or business.	Entire amount.	Income from a trade or business should arise from: 1. Supply of a commodity or service, other than water or electricity, within its own jurisdiction. 2. Supply of water or electricity within or outside its jurisdiction.
10(21)	A scientific research association	Any income.	Entire amount.	1) The scientific research association should have been approved for the purpose of 35(1)(ii). 2) Other conditions prescribed in S.10(21) should be fulfilled.
10(22B)	A news agency	Any income.	Entire amount.	1) The news agency should be notified by the Central Government. 2) The news agency should have been set up solely for collection and distribution of news and should apply its income or accumulate it for application solely for such purpose
10(23A)	An approved association or institution established in India.	Any income other than: 1. Income from House Property 2. Income for rendering specific services 3. Interests or dividends on investments	Entire amount	1) The institution should have as its object the control, supervision, regulation or encouragement of the profession of law, medicine, accountancy, engineering or architecture or other specified profession. (namely company secretary, materials management, chemistry & town planning) 2) The institution applies its income or accumulates it for application for its objects only. 3) The institution is approved by Central Government. [Refer Circular No. 584 dt. 13.11.90]
10(23AA)	Any person	Any Income	Entire amount.	1) Income should be received on behalf of any Regimental fund or Non-Public Fund established by the armed forces.
10(23AAA)	Employees Welfare Fund	Any income	Entire amount	1) Income should be received on behalf of a fund established for purposes notified by the Board for welfare of employees or their dependants. 2) Fund is approved by Commissioner. 3) Contributions/other sums received by the fund are invested as per section 11(5).
10(23AAB)	Pension Fund	Any income	Entire amount	1) Income should be received on behalf of a fund established by LIC or any other insurer under a pension scheme duly approved by appropriate authority.
10(23B)	Society or public Charitable trust	Any income	Entire amount	1) The society or the trust must exist solely for the purpose of development of khadi or village industries and not for the purposes of making profits. 2) The Society/Trust is approved by Khadi & Village Industries Commission
10(23BB)	Khadi and industries Board	Any income	Entire amount	Any statutory Authority
10(23BBA)	Body or authority under Central State or Provision Act	Any income	Entire amount	1) The body or authority should provide for the administration of religious or public charitable trusts.
10(23BBB)	European Economic Community	Interest, dividends or capital gains from investments	Entire amount	1) Instruments made out of its funds under notified scheme
10(23BBC)	SAARC Fund	Any income	Entire amount	1) Regional Projects set up under Colombo declaration
10(23BBD)	Secretariat of Asian Organisation of the Supreme Audit Institutions registered as ASOSAI – SECRETARIAT under Societies Registration Act, 1960	Any income	Entire amount	Exemption is available from Assessment Year 2001-02 to 2010-11.
10(23BBE)	IRDA	Any Income	Entire amount
10(23BBF)	North Eastern Development Finance Corporation Ltd. registered under Companies Act, 1956	Any Income	As provided in the proviso	-
10(23BBG)	Central Electricity Regulatory Commission constituted under Section 76(1) of Electricity Act, 2003.	Any Income	Entire Income	-
10(23C)	Any income of the following: i) P.M.’s National Relief Fund, ii) P.M.’s Fund iii) National foundation for communal harmony iv) University or other educational institution v) hospital financed by the government for treatment of specified diseases vi) PM’s Aid to Students fund. ii) For details please refer the relevant section Amendment: On or after 1st, June 2006 application for grant of exemption or continuance thereof shall have to be filed during the Financial year immediately Preceding the assessment year from which exemption is sought. Further w.e.f. 1-4-2007 any anonymous donation on which tax is payable shall be included in the total income u/s. 10(23C) of the Act. w.e.f. 1-6-2007, the Charitable Institutions or trusts have to be approved by the prescribed authority instead of Central Government.
10(23D)	Mutual Funds	Any income	Entire amount	1) The Mutual Fund must be a registered under SEBI Act or it should be a notified mutual fund set up by Public Sector bank or public financial institution or authorised by RBI
10(23EA)	Investor Protection Fund set up by recognised exchange in India	Any income	Entire amount	From assessment year 2007-08 exemption under this section shall be available only with respect to income received by way of contribution received from Recognised Stock Exchange and members thereof.
10(23EB)	Credit Guarantee Fund Trust for Small Industries	Any income	Entire amount	Trust is created by Government of India and SIDBI.
10 (23EC)	Investors Protection Fund set up by Commodity Exchanges in India	Contribution received from commodity exchanges and its members	Entire amount	1) Applicable w.e.f assessment year 2008-2009.
10 (23FA)	Venture Capital Fund or company	Income by way of dividend & long term capital gains	Entire amount	1) The venture capital fund or company is approved by Central Government. 2) Investment should must be made before 1-4-2000. 3) Refer section for other conditions.
10(23FB)	Venture Capital Fund or company	Any income from investment	Entire amount	1) For relevant definitions and other conditions please refer the Explanation to section 10(23FB)
10(23G)	Infrastructure Capital Company or fund or a Co-operative bank	Dividends, interest or long-term capital gains	Entire amount	1) Exemption was available till A.Y. 2006-07. For relevant definitions and other conditions please refer the Explanation to section 10(23G)
10(24)	Registered Trade Union	Income from House Property and Income from other sources	Entire amount
10(25)	Approved Provident Fund	Capital Gains and any income of certain specified fund	Entire amount
10(25A)	Employees State Insurance Fund	Any Income	Entire amount
10(26)	Member of Scheduled Tribe residing in specified areas	Income arisen or accrued from any source in the specified areas	Entire	1. Membership of Scheduled Tribe as defined in Article 366(25) of the Constitution. 2. He must reside in any area specified in Part I or Part II of the table appended to Paragraph 20 of Sixth Schedule to the Constitution or in the States of Arunachal Pradesh, Manipur, Mizoram, Nagaland & Tripura or in the areas referred to in the Notification by Governor of Assam dt. 23-2-1951 or in the Ladakh region of the State of J & K.
10(26AAA) Inserted by(Finance Act, 2008)	Individual	Income from any source in the State of Sikkim, or by way of dividend or interest on securities	Entire	Individual should be a Sikkimise as defined under this section
10(26AAB)	Income of an agricultural produce market committee or board	Any Income	Entire Amount	1) The committee or board should be constituted under any law for the time being in force. 2) It should be constituted for regulating the marketing of agricultural products.
10(26B)	Corporation of Government or any body wholly financed by government	Any Income	Entire	1. The corporation should be established by a Central, State or Provincial Act. 2. Such a corporation or any body should be established for promoting interest of members of Scheduled Caste or Scheduled Tribe or backward classes or all of them
10(26BB)	Corporation established by Central Government or any State Government (National Minorities Development & Financial Corporation)	Any Income	Entire	1. Such a corporation should be established for promoting interest of members of notified communities 2. Muslims, Christians, Sikhs, Buddhists, Zoroastrians/Parsis are notified minority communities for the purpose of this section
10(26BBB)	Corporation established by Central, State or Provincial Act	Any Income	Entire	1. Such a corporation is established for the welfare & economic upliftment of ex-Servicemen being citizens of India
10(27)	Co-operative Society	Any Income	Entire	1. Society is formed for promoting interest of members of Scheduled Caste or Scheduled Ttribe or both referred to in clause (26B) 2. Membership of the society is limited to only the co-operative societies formed for similar purposes 3. Finance of such society is provided by government or such other societies.
10(29A)	Specified commodity boards/export development authorities	Any Income	Entire	Date of exemption is either 1-4-1962 or the dates when these specified boards/authorities were constituted whichever is later
10(30)	Assessee engaged in business of growing & manufacturing tea in India	Subsidy income from Tea Board	Entire Subsidy	1. Subsidy is received as per scheme specified by government. 2. For exemption a certificate from Tea Board showing the amount of subsidy paid to the assessee during the previous year has to be attached with the return of income.
10(31)	Assessee engaged in business of growing & manufacturing rubber, coffee, cardamom or such other commodity in India as notified by Central Government	Subsidy income from concerned commodity board	Entire Subsidy	1. For exemption a certificate from concerned board showing the amount of subsidy paid to the assessee during the previous year has to be attached with the return of income
10(32)	Individual	Any income per child	Up to Rs. 1500	1) Wherever income of minor child is clubbed in the income of the parent by virtue of Section 64(1A), an amount up to Rs. 1,500 shall be allowed as an exemption
10(33)	Any person	Income arising from transfer of unit of US-64	Entire amount Scheme	1) Transfer of such units takes place on or after 1-4-2002
10(34)	Any person	Dividend income referred to u/s 115-O	Entire amount
10(35)	Any person	Income from units of a Mutual Fund other than income arising from transfer.	Entire amount
10(36)	Any person	Long term Capital Gain.	Entire amount	1) The capital gain must arise on transfer of equity shares of a listed company purchased from the stock exchange or in a public issue purchased between 1st March, 2003 and 1st March, 2004 and held for more than 12 months.
10(37)	Individual or HUF	Capital gains on transfer of agricultural land situated in area specified in item (a) or (b) of section 2(14)(iii).	Entire amount	1) The capital gains must arise from compulsory acquisition of agricultural land held in an urban area and compensation is received on or after 1st April, 2004 2) Such land was used by the HUF or in case of individual by himself or his parents, for a period of 2 years immediately preceding the date of transfer. 3) Such transfer is by way of compulsory acquisition under any law, or a transfer whose consideration is determined or approved by the Central Government or the Reserve Bank of India. 4) The consideration or compensation for such transfer is received by the assessee on or after 1st April, 2004
10(38)	Any person	Long Term Capital Gains on transfer of Long term capital asset being equity share in a company or a unit of an equity oriented fund.	Entire amount	1) Such transaction of transfer/sale of equity share in a company or a unit to an equity oriented fund is chargeable to securities transaction tax. Amendment 1: With effect from A.Y. 2007-08, Long-Term Capital Gain generated by a company which is exempt under this section will be taken into consideration for calculation of Book Profits u/s 115JB for purpose of calculating MAT Amendment 2: Definition of Equity Oriented Fund has been amended from June 1, 2006. Equity Oriented Fund means a Fund where investable funds are invested by way of equity shares in Domestic Companies to the extent of more than 65%
10(39)	Person or persons notified by Central Government in the Official Gazette	Specified income arising from any international sporting event in India	Entire specified income	1. International sporting event has to be approved by the international body regulating the international sport relating to such event. 2. Such an event must have participation by more than 2 countries. 3. Such an event has to be notified by the Central Government in the Official Gazette.
10(40)	Subsidiary co. of a co. engaged in the business of generation etc. or distribution of power	Grant income or other income received from Indian holding co.	Entire grant or that other income	1. Exemption is available only if such income is received for settlement of dues in connection with reconstruction or revival of an existing business of power generation.
10(41)	Any undertaking engaged in the business of generation, transmission or distribution of power	Capital gain on transfer of asset	Entire capital gain	1. Transfer should be effected on or before 31-3-2006 to the Indian company notified u/s 80IA(4)(v)(a).
10(42)	Non Profit Body or Authority Notified by Central Government	Specified Income	Entire amount	Such Body or Authority should be established, constituted or appointed under a Multilateral Treaty, Agreement or Convention to which Central Government is a Signatory.
10(43)	Individual	Income from Transaction of Reverse Mortgage	Entire amount	Such Reverse Mortgage scheme is made and notified by the Central Government.