Fiscal Incentives
| Type of Institutions | Incentives | Notifications/Acts/Orders | Approval & Application Forms |
|---|---|---|---|
| Industries having in-house R & D Centers |
i. Write off of revenue expenditure Write off of capital expenditure Duty free import of Pharmaceutical reference standards. Duty free import of analytical & specialty equipment List 28 for R & D. Duty free import of analytical & specialty equipment List 28 for production. |
Section 35(1) (i) of Income Tax Act Section 35(1) (iv) of Income Tax Act Notification No. 26/2003-Customs dated 1st March 2003 (item at serial no. 138) Notification No. 26/2003-Customs dated 1st March 2003 {item at serial no. 248 (1)} Notification No. 26/2003-Customs dated 1st March 2003 {item at serial no. 248 (2)} |
No approval required. Cases referred to the prescribe authority (DGIT (E) Calcutta in concurrence with Secretary DSIR) through CBDT, in case of dispute with assessing officer. In-house R & D centres should be approved by DSIR. Click for Form ( Recognition , Renewal of recognition) In-house R & D centres should be approved by DSIR. Click for Form ( Recognition , Renewal of recognition yearly return) In-house R & D centres should be approved by DSIR. Click for Form ( Recognition , Renewal of recognition yearly return) |
| Industry / Private Sponsored research programmes | Weighted tax deduction of 125% | Section 35(2AA) of the Income Tax Act. | The Head of the concerned National Laboratory or the University or the Indian Institute of Technology. |
|
Companies engaged in business/manufacture/production in following areas - Bio-technology Drugs & Pharmaceuticals Electronic equipment Computers Telecommunication equipment Chemicals Aircraft's and helicopters Automobiles including Automobile Components |
Weighted tax deduction of 150 % | Section 35(2AB) of the Income Tax Act) | Click for Guidelines & Form |
| Commercial R & D Companies | Ten years tax holiday for companies approved by DSIR before 1st April 2004. Extended from April 1, 2004 to March 31, 2005 | Section 80-IB(8A) of Income Tax act | Click for guidelines & application forms |
| Investments on plant & machinery based on indigenous technology | Accelerated depreciation allowance @ 40 % | Rule 5(2) of Income Tax Rules. | Click for guidelines & forms |
| Public funded R & D institutions |
Duty free import of equipment and consumables. Excise duty exemption on equipment and consumables. |
Notification No.51/96 Customs dated 23rd July 1996. Notification No. 10/97- Central Excise dated 1st March 1997. |
Click for Form (registration, Renewal of registration) |
|
Scientific Research Associations with object of undertaking scientific research or university, college or other institutions. University, college or other institutions carrying out research in social sciences or statistical research. |
Income tax exemption of 125% to donations. Income tax exemption of 125% to donations |
Prescribed authority is Central Government. Prescribed authority is Central Government. |
|
| SIROs recognized by DSIR |
Duty free import of equipment and consumables. Excise duty exemption on equipment and consumables. |
Click for Form. Click for Form. |
|
| Any wholly owned Indian company | Excise duty exemption for 3 years on goods designed and developed and patented in any two countries out of: India , USA , Japan and any one country of European Union | Notification No. 15/96 CE dated July 23, 1996 , amended vide Notification No. 13/99- CE dated February 28, 1999. | - |
| Any Indian company |
Exemption from price control of DPCO Revenue expenditure on R & D laid out within three years immediately preceding the commencement of business |
Click for Form. Prescribed authority is DGIT (E) Calcutta in concurrence with Secretary DSIR |
|
| R & D projects funded by Government of India. | Exemption from Custom duty on imports. | Notification No. 50/96-Customs dated 23 July 1996 | - |
Last Updated: 25/11/2004
