32. Procedure, form and manner in respect of approval under section 45(4) read with section 45(3)(a) for deduction for expenditure on scientific research by a research association.–

(1) An application for approval under section 45(4)(b) in Form No. 17 shall be made to the Commissioner of Income-tax having jurisdiction over the applicant, at any time during the financial year immediately preceding the tax year from which the approval is sought.

(2) Where approval is sought—

(a) from the tax year 2026-2027; or

(b) from the tax year in which the applicant is incorporated, the application for approval may be made at any time during the said tax year.

(3) The person who is authorised to verify the return of income under section 265, as applicable to the applicant shall verify Form No. 17.

(4) If the research association claims an exemption as per Schedule III [Table: Sl. No. 23], then the Annexure to Form No. 17 shall also be filled out.

(5) The applicant shall send a copy of the application to Member (IT), Central Board of Direct Taxes accompanied by its acknowledgement receipt as evidence of having furnished the application as per sub-rule (1).

(6) Where an application is made under sub-rule (1), every notification under section 45(4)(b) shall be issued or an order rejecting the application shall be passed by the Central Government recording reasons therefor in writing, within twelve months from the end of the quarter in which such application was received in the office of Member (IT), CBDT.

(7) Any notification issued by the Central Government under section 45(4)(b) shall, at any time, have effect for such tax year or years, not exceeding five tax years as may be specified in such notification.

(8) If any defect is noticed in the application, or if any relevant document is not attached thereto, the Commissioner of Income-tax shall serve a deficiency letter on the applicant before the expiry of one month from the end of the month in which application is received in his office.

(9) The applicant shall remove the deficiency referred to in sub-rule (8) within a maximum period of one month from the end of the month in which the deficiency letter is served and if the applicant fails to remove such deficiency within the period so allowed, the Commissioner of Income-tax shall send his recommendation for treating the application as invalid to the Member (IT), Central Board of Direct Taxes.

(10) The Central Government, if satisfied, may pass an order, for reasons to be recorded in writing, treating the application as invalid.

(11) If the application is complete in all respects, the Commissioner of Income-tax, may make such inquiry as he may consider necessary regarding the genuineness of the activity of the research association or University or college or other institution and send his recommendation to the Member (IT), CBDT for grant of approval or rejection of the application before the expiry of the period of three months from the end of the quarter in which the application was received in his office.

(12) The Central Government may, before granting approval under section 45(4)(b), call for such documents or information from the applicant as it may consider necessary and may get any inquiry made for verification of the genuineness of the activity of the applicant.

(13) The Central Government may withdraw the approval granted under section 45(4)(b), if it is satisfied that the research association or University or college or other institution has ceased its activities, or its activities are not genuine, or are not being carried out in accordance with all or any of the conditions specified under rule 33 or rule 34.

(14) No order treating the application as invalid, or rejecting the application or withdrawing the approval, shall be passed without giving a reasonable opportunity of being heard.

(15) A copy of the order invalidating or rejecting the application or withdrawing the approval shall be communicated to the applicant, the Assessing Officer and the Commissioner of Income-tax having jurisdiction over the applicant.

(16) The applicant, may, at least three months before the expiry of the effective period of the notification issued under sub-rule (6), make an application to the Commissioner of Income-tax having jurisdiction over the applicant for issue of a fresh notification.