Income Tax Form 37: Certificate for Patentees Receiving Royalty (Section 152(5))

Form 37, prescribed under Rule 71 of the Income-tax Rules, 2026, is a mandatory certificate for resident individual patentees claiming deduction under section 152(5) of the Income-tax Act, 2025 on royalty income from patents registered under the Patents Act, 1970. The form must be filed electronically on the income tax portal on or before the due date of return filing and requires self-declaration by the patentee along with certification by the Controller of Patents. It captures detailed information on patent registration, royalty agreements, income received, foreign remittances, and deduction claimed. Filing within the prescribed timeline is essential, as non-compliance may lead to denial of deduction. The form cannot be revised once submitted and mandates accurate reporting, including PAN details. Enhanced digital structure, new reporting fields, and standardized formats improve transparency, compliance, and verification, making Form 37 a critical requirement for taxpayers earning patent royalty income.

Income Tax Department
Ministry of Finance, Government of India

FAQs on Income Tax Form 37: Certificate under section 152(5) of Income Tax Act, 2025 for Patentees in receipt of royalty income

Certificate for claiming deduction under section 152(5) of the Income-tax Act, 2025 by resident individual patentees in receipt of royalty on patents

Q1. What is Form 37 ?

Ans: Form 37 is the prescribed form for filing of certificate for claim of deduction under section 152(5) of the Income-tax Act’ 2025 (“ITA 2025”) by a patentee, being a resident individual, who is in receipt of royalty income during the relevant tax year, in respect of a patent registered on or after 01.04.2003 under the Patents Act’ 1970.

Q2. Who should file Form 37?

Ans: Any individual resident patentee, who is in receipt of income by way of royalty on patents during the relevant tax year, and who intends to claim deduction in respect of such royalty income under section 152(5) of the ITA 2025, should file the certificate in Form 37.

Q3. Who is required to verify the Form 37?

Ans. The patentee, who is in receipt of royalty income on patents, during the relevant tax year, is required to make a self-declaration in Part B of the Form 37, to the effect that the royalty income declared therein on the patents is eligible for deduction under section 152 of the ITA 2025.

Further, the Controller of Patents in whose jurisdiction the patent was registered, is also required to certify the details of the patent registered, the details of the patentee in whose name the patent was registered, and the detail of compulsory license issued by his office, if any, in respect of such registered patents; independently in Part C of the Form 37.

Q4. Where and how the Form 37 is required to be filed?

Ans: The Form 37 shall be filed electronically on the e-filing portal of Income-tax Department. The form shall be furnished electronically either under digital signature or through electronic verification code, duly verified by the patentee. The details of the patent registered, patentee, and compulsory license issued for such patent, if any, (as mentioned by the author in Rows 3 to 5 of Part B), are further required to be certified by the Controller of Patents.

Q5. What is the time limit for filing Form 37?

Ans: The certificate in Form 37 for claim of deduction under section 152(5) of the ITA’ 2025 is required to be filed electronically on or before such “due date” for filing return of income prescribed under section 263(1)(c) of the ITA’ 2025, as may apply for the individual patentee claiming the deduction. This time limit is specified in the statute itself.

Q6. What documents are required to file Form 37?

Ans: The following documents may be required while filing Form 37, –

> Royalty Agreement

> Statement of Royalty paid during the year

> Bank advisories,

> Foreign Inward Remittance Certificate/ bank entry, if applicable

> Approval of competent authority for extension of period, if any, in case of foreign inward remittances

> Compulsory license issued by the Controller of Patents in respect of the registered patent, if any

Q7. Is Form 37 mandatory?

Ans: Filing of a valid Form 37 within the specified time limit, is a mandatory condition for making an admissible claim of deduction under section 152(5), by the patentee, being a resident individual, who is in receipt of royalty income on patents, during the relevant tax year.

Q8. Can I edit Form 37 after submission?

Ans: No. Once Form 37 is validly submitted, after self-declaration by the patentee and certification by the Controller of Patents, and acknowledgment is generated, it cannot be edited. Please ensure that all details are correct before final submission.

Q9. Do I need to attach any document with the Form 37?

Ans: It is not mandatory to attach any document with the Form 37.

Q10. While filling Part A and Part B, can I leave any field blank?
Ans:

> PAN of the Patentee is mandatory. Name and complete address thereof shall be pre-filled, which can be updated by the user.

> PAN of the person paying the royalty on patent can be left blank only if it is a foreign entity having no PAN.

> Details and amounts in Columns 5, 8 and 9 of Part B may be provided, as applicable.

Amount of deduction claimed in Column 10 is a mandatory field.

Q11: What if the patentee does not have a PAN?

Ans: Form 37 cannot be submitted without a valid PAN of the patentee.

Q12. Can Form 37 be filed offline?

Ans: No. Form 37 can only be submitted online through the Income Tax e-Filing portal.

Q13. Why is Form 37 important?

Ans: Filing of a valid certificate in Form 37 within the specified time limit is a mandatory compliance for claiming deduction in respect of royalty on patents, under section 152 of the ITA’ 2025. However, the claim of deduction is further subject to fulfillment of various other eligibility conditions, as prescribed in the statute.

Q14. Can I mention the amounts of foreign inward remittances in the foreign currency?

Ans. No. The amounts of royalty received in foreign currency is required to be stated in Indian rupees, in the rows (8) and (9).

Guidance Note on Income Tax Form 37: Certificate under section 152(5) of Income Tax Act, 2025 for Patentees in receipt of royalty income

Form 37 – Certificate for deduction under section 152(5) of the Act for patentee in receipt of royalty income, etc.

Purpose:

Form 37 is prescribed under Rule 71 of the Income-tax Rules and is required to be furnished for claiming deduction under section 152(5) of the Income Tax Act, 2025 in respect of income received by a patentee in the nature of royalty for patents.

This deduction is available to a resident individual, being a patentee, in respect of income from royalty on patents registered under the Patents Act, 1970 and subject to the fulfilment of conditions specified under the Act, including repatriation of foreign source income within the prescribed time limit, where applicable.

The form captures details relating to the patentee, particulars of the patent, royalty income received, foreign remittance (if any), and other eligibility conditions for the deduction.

Who Should File:

Any patentee who is in receipt of income by way of royalty from patents and wishes to claim deduction under section 152(5) of the Income Tax Act, 2025.

Part A of the Form is required to be filled and verified by the patentee (taxpayer).

Part B of the Form is required to be certified by the prescribed authority — Controller of Patents, verifying the patent details maintained in the patent register.

When and How to File:

• Form 37 shall be furnished electronically on the income-tax e-filing portal.
• The form shall be filed electronically under digital signature or through electronic verification code (EVC).
• Part A and B is to be completed and verified by the patentee.
• Certificate by the Controller of Patents, certifying the patent information and compulsory licence status, if any.

Structure of Form 37:

The form consists of the following parts:
Part A – Basic information

• Name, Address and PAN of patentee
• Tax Year in which deduction is being claimed

Part B – Computation of Deduction under Section 152(5) of Income tax Act, 2025 The relevant Columns are as under:

• Column 3 : Details of the Patent – Registration no. and Date, Title, etc.
• Column 4 : Details of the patentee
• Column 5 : Information related to compulsory license issued for the patent, if any
• Column 6 : Details of person paying royalty – Name, Address, PAN
• Column 7 : Details of Royalty Agreement – Nature, period, amount
• Column 8 : Details of royalty received in INR and foreign currency with date and mode
• Column 9 : Details of amount brought into India in convertible foreign exchange
• Column 10 : Amount of deduction claimed

Declaration – Declaration by the taxpayer affirming correctness and completeness of information

Certification – Certification by the Controller of Patents as to correctness of relevant information given by the patentee.

Documents Required to File Form 37:

> Compulsory license issued by the Controller of Patents in respect of the patent

> Royalty agreement

> Bank Statement

> Foreign Inward Remittance Certificate, where applicable

> RBI approval, where applicable

Outcome of Processing Form 37:

> Once the Form 37 is validly filed and processed, the individual patentee can claim deduction under section 152(5) in respect of royalty income, subject to fulfilment of eligibility conditions.

> If royalty income arises from outside India and is not repatriated within six months, deduction may be restricted unless extended time is permitted by the competent authority.

Key Updates in Form:

• Primary data fields have been re-sequenced and rationalized to improve the logical flow of the information furnished.
• PAN of the patentee is now captured for accurate identification.
• New structured field introduced to report all details of royalty income, including PAN of the payer, which was not available in the original form.
• A new field of location of the patent office introduced to seamlessly transfer the form to concerned patent office for verification
• Separate fields introduced to capture foreign source income, timelines of inward remittance, and details of the competent authority allowing extension, if applicable.
• The main body of the Form has been redrafted in simplified language and aligned with objective parameters required for eligibility under section 152(5).
• Data fields have been standardized and reorganized to suit digitized filing and automated checks.

Improved Applicant Experience:

• The Form has been made more concise, readable, and user-friendly for patentees.
• The taxpayer fills in all the necessary details in Part A and Part B for claiming deduction. Out of these, only the details related to the patent need to be certified by the Controller of Patent, resulting in ease for both.
• System-oriented fields and standardized formats minimize misreporting and enable faster verification.
• Mandatory e-filing eliminates dependency on physical submission and improves processing time.

Challenges in Earlier Form:

• PAN of the patentee and PAN of the payer of royalty were not captured.
• There was no column to report repatriation and competent authority approvals in respect of foreign royalty income — a key eligibility parameter.

Solutions Built into the Proposed Form

• Insertion of mandatory fields for PAN of the patentee and PAN of the payer.
• Introduction of dedicated fields for foreign income repatriation timelines and competent authority details.
• Simplification and restructuring of form for clarity and uniformity.