Representative image of a store in Ahmedabad, India selling Patanjali Ayurved products. (Image: Reuters/Amit Dave)
In a big boost for Ramdev's Patanjali Group, the Central Board of Direct Taxes (CBDT) has granted a 5-year tax exemption on donations made to Patanjali Research Foundation Trust for five years.
Businesses making donations to Patanjali Research Foundation Trust during 2021-22 to 2026-27 can claim a tax deduction on such contributions, a CBDT notification said.
Patanjali Group, which sells products ranging from toothpaste to instant noodles and toilet cleaner, is among the fastest-growing consumer goods companies in the country.
Read | Patanjali Group clocks Rs 30,000 crore turnover in FY21; aims to be debt free in 3-4 years
"... the Central Government hereby approves M/s Patanjali Research Foundation Trust, Haridwar under the category Research Association for Scientific Research for the purposes of clauses (ii) of sub-section (1) of section 35 of the Income-tax Act, 1961...," the Central Board of Direct Taxes (CBDT) said in a notification.
This shall be applicable for Assessment Year(s) 2022-23 to 2027-28, it added.
Under Income Tax rules, in computing the income under head business and profession, a taxpayer is permitted to deduct therefrom, any amount paid to an 'approved scientific research association' for undertaking scientific research.
Patanjali Research Foundation Trust, Haridwar, has been notified as the 'approved research association'. Hence, a business entity that pays any amount to the Foundation for scientific research shall be eligible to claim the said expense as a deduction from business income under section 35 of the Income Tax Act, thereby reducing their tax outgo.
Patanjali Group clocks Rs 30,000 crore turnover in FY21
Meanwhile, Patanjali Group on July 13 said it has achieved a turnover of around Rs 30,000 crore in fiscal 2020-21, helped by a revenue boost of Rs 16,318 crore from Ruchi Soya -- a company it had acquired last fiscal through insolvency resolution.
The Patanjali Group is aiming to make its companies debt-free in the coming 3-4 years, and a substantial portion of the follow-on public offer (FPO) of Ruchi Soya, which has a debt of around Rs 3,330 crore, will be diverted to pare its debt, Ramdev said at a virtual press conference.(With agency inputs)