Patanjali Research Foundation Trust, which had applied for income tax benefits a year ago, has withdrawn its application after the finance ministry expressed its reservations over the same, sources told CNBC-TV18.
Under Section 35 (I) (iia) of the Income Tax Act, one is allowed 125 percent deduction on scientific research expenditure.
"CBDT, Revenue secretary and Minister of State for Finance had unanimously said that the trust cannot be given such an exemption," said the sources, who did not want to be named.
Patanjali confirmed the development to CNBC-TV18. "The exemption was sought by Patanjali Research Foundation Trust for 125 percent exemption under section 35 (I)(iia) of the Income Tax Act, 1961 for research on Yoga and Ayurveda," it said.
It had applied for exemption in April 2018 and withdrew the application on 30 April 2019.
"The company may apply afresh for the same exemption in future," Patanjali spokesperson said.
According to the revenue dept sources, the application was withdrawn by the trust after it failed to meet the eligibility criteria.
"Upon examination of the case, the income tax department felt that Patanjali Research Foundation Trust was not an academic research institution and thus it did not qualify for the exemption," the sources said.
However, the company sources said that it was just a reservation that led to the withdrawal of the application.
