Section 10(20) → Section 12
Income of Local Authority
Quick Answer
Section 10(20) of the Income Tax Act, 1961 (Income of Local Authority) corresponds to Section 12 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective 1st April 2026. Status: Retained.
Sec 10(20)
Provision Summary
Exempts specific income (like water/electricity supply outside jurisdiction, or house property) of a local authority (Panchayat, Municipality).
Sec 12
Provision Summary
Retained verbatim. Ensures that grass-root level government bodies do not pay income tax on their public utility operations.
Key Changes & Highlights
- Definition of 'Local Authority' strictly mapped to constitutional amendments.
Frequently Asked Questions
What does Section 10(20) of the Income Tax Act 1961 deal with?
Section 10(20) (Income of Local Authority) Exempts specific income (like water/electricity supply outside jurisdiction, or house property) of a local authority (Panchayat, Municipality).
What is the new section number for Section 10(20) under the Direct Tax Code 2025?
Section 10(20) of the ITA 1961 maps to Section 12 of the Direct Tax Code 2025 (Income-tax Act, 2025), effective from 1st April 2026.
What is the status of Section 10(20) under the new tax code?
Section 10(20) is marked as "Retained" with status "Active". Impact: High - Protects municipal corporations from tax liabilities.
What are the key changes to Section 10(20) under DTC 2025?
Definition of 'Local Authority' strictly mapped to constitutional amendments.
Disclaimer: This page is for educational and reference purposes only. Section mappings are based on publicly available drafts and circulars. Always consult a qualified Chartered Accountant before filing or making compliance decisions under the Direct Tax Code 2025.
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