The Central Board of Direct Taxes (CBDT), Department of Revenue, Ministry of Finance, has notified tax exemption in respect of specified income of the District Legal Service Authority, Panchkula (PAN: AAAGC0054R) through Notification No. 112/2026 and Notification No. 113/2026, both dated 11 August 2026.
The two notifications ensure continuity of the tax treatment of the Authority across the transition from the Income-tax Act, 1961 to the Income-tax Act, 2025, while prescribing the categories of income eligible for exemption and the conditions required to be fulfilled by the Authority.
Notification No. 112/2026: Exemption for Financial Years 2022-23 to 2025-26
Through Notification No. 112/2026 [S.O. 4458(E)] dated 11 August 2026, the Central Government has notified the District Legal Service Authority, Panchkula, an authority constituted under the Legal Services Authorities Act, 1987, for the purposes of Section 10(46) of the Income-tax Act, 1961.
The notification has been issued in pursuance of the transitional provisions contained in Section 536(2)(a) to (c) and (e) of the Income-tax Act, 2025. These provisions preserve, among other things, rights, privileges, obligations, liabilities and proceedings relating to periods governed by the repealed Income-tax Act, 1961.
Under Notification No. 112/2026, exemption has been provided in respect of specified income of the Authority comprising grants received from the Punjab and Haryana High Court, National Legal Services Authority (NALSA) and Haryana State Legal Services Authority for the purposes of the Legal Services Authorities Act, 1987; grants or donations received from the Central Government or Government of Haryana for such purposes; amounts received pursuant to orders of courts; fees received as recruitment application fees; and interest earned on bank deposits.
The exemption is subject to the conditions that the District Legal Service Authority, Panchkula shall not engage in any commercial activity, its activities and the nature of the specified income shall remain unchanged during the relevant financial years, and it shall file its return of income in accordance with Section 139(4C)(g) of the Income-tax Act, 1961.
Failure to comply with the prescribed conditions would result in initiation of penal action under the Income-tax Act, 1961 and withdrawal of the exemption granted under Section 10(46) of that Act.
The notification shall be deemed to have applied for Assessment Years 2023-24, 2024-25, 2025-26 and 2026-27, corresponding to Financial Years 2022-23, 2023-24, 2024-25 and 2025-26, respectively. The notification also contains an Explanatory Memorandum stating that giving retrospective effect from the year of application filed before CBDT or the Income-tax Department does not adversely affect the interests of any person.
Notification No. 113/2026: Exemption Continued for Tax Year 2026-27 under Income-tax Act, 2025
In continuation of the above tax treatment under the new statutory framework, the Central Government has issued Notification No. 113/2026 [S.O. 4459(E)] dated 11 August 2026 under Schedule III [Table: Sl. No. 36] read with Section 11 of the Income-tax Act, 2025.
Through the notification, the District Legal Service Authority, Panchkula has been notified for exemption in respect of specified income comprising grants received from the Punjab and Haryana High Court, NALSA and Haryana State Legal Services Authority; grants or donations from the Central Government or Government of Haryana; amounts received under orders of courts; recruitment application fees; and interest earned on bank deposits.
The exemption under Notification No. 113/2026 is subject to the Authority not engaging in any commercial activity, filing its return of income in accordance with Section 263(9)(c)(xiii) of the Income-tax Act, 2025, and ensuring that its activities and the nature of the specified income remain unchanged throughout the tax year.
Non-compliance with these conditions would result in withdrawal of the exemption under Schedule III [Table: Sl. No. 36] read with Section 11 of the Income-tax Act, 2025, along with initiation of proceedings under the Act.
Notification No. 113/2026 shall apply for Tax Year 2026-27, thereby providing continuity of the exemption under the framework of the Income-tax Act, 2025 following the periods covered under Notification No. 112/2026.
Continuity of Tax Exemption Across New Income-tax Framework
Taken together, Notifications No. 112/2026 and 113/2026 provide a continuous framework for exemption of the specified income of the District Legal Service Authority, Panchkula. Notification No. 112/2026 addresses the relevant financial and assessment years governed by the Income-tax Act, 1961, while Notification No. 113/2026 extends the specified-income exemption to Tax Year 2026-27 under the Income-tax Act, 2025.
The notifications recognise the statutory functions performed by the District Legal Service Authority under the Legal Services Authorities Act, 1987, while linking the exemption to continued adherence to the prescribed conditions, including the non-commercial nature of its activities and compliance with applicable income-tax return filing requirements.
The Notification can be accessed at: Notification No. 112/2026 & Notification No. 113/2026
