Notification u/s 35(1)(ii) of the Income Tax Act, 1961 in the case of KIMS Foundation and Research Centre, Hyderabad

## Policy Analysis Report: Notification S.O. 1770(E) - Approval of KIMS Foundation and Research Centre **1. Executive Summary:** This report analyzes Notification S.O. 1770(E), issued by the Ministry of Finance, Department of Revenue, Central Board of Direct Taxes (CBDT), which approves KIMS Foundation and Research Centre, Hyderabad, as an "Other Institution" under the category of University, College or Other Institution for Scientific Research for the purposes of claiming deductions under Section 35(1)(ii) of the Income-tax Act, 1961. This notification is effective retrospectively from the Previous Year 2025-26 and applicable for Assessment Years 2026-27 to 2030-31. The key finding is that this notification enables donors to KIMS Foundation and Research Centre to claim tax deductions, incentivizing scientific research funding. **2. Introduction:** This report aims to provide a comprehensive overview of Notification S.O. 1770(E) based solely on the information provided in the given text. The report will detail the policy’s objective, key provisions, affected stakeholders, and potential impact. **3. Policy Overview:** This is a *new* policy notification, not an amendment. * **Core Objective(s):** The primary objective, as inferred from the text, is to grant tax benefits to individuals or entities making donations to KIMS Foundation and Research Centre, thereby encouraging financial support for scientific research. This is achieved by officially recognizing the institution under Section 35(1)(ii) of the Income-tax Act, 1961. **4. Background and Rationale:** This is a *new* policy. The likely problem the policy addresses is the need to incentivize funding for scientific research. By granting KIMS Foundation and Research Centre the status of an approved institution, the government aims to attract more donations through tax benefits, which in turn, should bolster the institution's research capabilities. Without this specific approval, donations might not be eligible for tax deductions, potentially limiting funding. **5. Key Provisions / Changes:** This is a *new* policy, therefore: * The notification explicitly approves KIMS Foundation and Research Centre, Hyderabad (PAN: AABTK7589F) as an "Other Institution" under the category of University, College or Other Institution for Scientific Research. * This approval is granted under clause (ii) of subsection (1) of section 35 of the Income-tax Act, 1961, read with Rules 5C and 5E of the Income-tax Rules, 1962. * The notification is effective from the date of publication in the Official Gazette, specifically from the Previous Year 2025-26, and applicable for Assessment Years 2026-27 to 2030-31. **6. Target Audience and Stakeholders:** The primary target audience and stakeholders are: * **KIMS Foundation and Research Centre, Hyderabad:** The direct beneficiary of this notification, as it allows the institution to attract more funding through tax-deductible donations. * **Donors to KIMS Foundation and Research Centre:** Individuals and entities making donations to the institution, who can now claim tax deductions under Section 35(1)(ii) of the Income-tax Act, 1961. * **The Income Tax Department:** Which is responsible for processing the tax deductions. **7. Implementation Aspects (Inferred):** * **Responsible Agency/Bodies:** The Central Board of Direct Taxes (CBDT) is the responsible agency, as it issued the notification. The Income Tax Department would also be involved in the implementation through processing tax deductions claimed by donors. * **Timelines and Procedures:** The notification specifies the effective period, from the Previous Year 2025-26 and applicable for Assessment Years 2026-27 to 2030-31. Procedures for claiming tax deductions would likely be governed by existing rules and regulations under the Income-tax Act, 1961, and Income-tax Rules, 1962. **8. Expected Outcomes / Impact of Changes:** * The intended outcome is to increase financial support for scientific research at KIMS Foundation and Research Centre. By offering tax incentives to donors, the notification aims to attract more funding, which can then be used to enhance the institution’s research activities and infrastructure. * The approval may improve the research output and visibility of KIMS Foundation and Research Centre. **9. Conclusion:** Notification S.O. 1770(E) is a significant policy that approves KIMS Foundation and Research Centre as an eligible institution for tax-deductible donations related to scientific research. This will likely lead to increased funding for the institution and contribute to the advancement of scientific research in the specified field. The retrospective application from the Previous Year 2025-26 makes this policy immediately relevant for donors and the institution.

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