The Central Board of Direct Taxes (CBDT), through Notification No. 38/2026, granted income tax exemption under Section 10(46) of the Income-tax Act, 1961 to the Odisha PVTG Empowerment and Livelihoods Improvement Programme (OPELIP), a state government authority. The exemption applies to specified income such as state government grants, interest on deposits refundable to the Government of Odisha, and non-refundable tender fees. The notification imposes conditions that the entity must not engage in commercial activities, must maintain consistency in the nature of its activities and income, and must comply with return filing requirements under Section 139(4C). Non-compliance may lead to withdrawal of exemption and penal consequences. The exemption is granted with retrospective effect from Assessment Year 2025–26 and will continue up to Assessment Year 2029–30. The notification ensures tax relief for a welfare-focused program while maintaining strict compliance safeguards under the law.
MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
Notification No. 38/2026-Income Tax |Dated: 27th March, 2026
S.O. 1627(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, ‘Odisha PVTG Empowerment and Livelihoods Improvement Programme (OPELIP)’ (PAN AAALO0342F), an Authority constituted by the State Government of Odisha, in respect of the following specified income arising to that Board, namely:-
a. Grants received form state government;
b. Interest on fixed Deposit and Saving account, which are refundable to Govt. of Odisha; and
c. Non-refundable Tender fee.
2. This notification shall be effective subject to the conditions that Odisha PVTG Empowerment and Livelihoods Improvement Programme (OPELIP)-
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. Failure to comply with these conditions may result in the initiation of penal actions under the provisions of the Income-tax Act, 1961 and withdrawal of the exemption granted u/s 10(46) of the Act.
4. This notification shall be deemed to have been applied for the period of assessment year 2025-2026 (Financial year 2024-2025) and shall apply with respect to the assessment year 2026-2027, 2027-2028, 2028-2029 and 2029-2030 (Financial year 2025-2026 to 2028-2029).
[Notification No. 38/2026/F.No.300196/4/2025-ITA-I]
HARDEV SINGH, Under Secy.
Explanatory Memorandum
It is certified that no person is being adversely affected by giving retrospective effect [with effect from the year of application filed with the CBDT/ Income-tax Department] to this notification.
