CBDT Preserves Maharashtra Electricity Regulatory Commission Tax Exemption Across 1961 and 2025 Income-Tax Laws

The Central Board of Direct Taxes has issued a pair of notifications to preserve the tax-exemption framework for the Maharashtra Electricity Regulatory Commission as India transitions from the Income-tax Act, 1961 to the Income-tax Act, 2025.

Notification No. 116/2026, S.O. 4706(E), and Notification No. 117/2026, S.O. 4707(E), were both dated 25 August 2026. Together, they deal with the same statutory commission across two tax-law periods: the first notification applies the exemption framework under section 10(46A) of the 1961 Act for Assessment Year 2026-27, while the second carries the recognition forward under the Income-tax Act, 2025 from Tax Year 2026-27.

What Notification No. 116/2026 does

Notification No. 116/2026 has been issued in the context of the repeal and transition provisions contained in section 536 of the Income-tax Act, 2025. The notification records that section 10(46A) of the Income-tax Act, 1961 provided for exemption of specified income of certain notified bodies, authorities, boards, trusts or commissions that are not companies.

CBDT has notified the Maharashtra Electricity Regulatory Commission, PAN AAAGM0004R, for the purposes of section 10(46A) of the 1961 Act. The Commission is identified as a statutory commission constituted under the Electricity Regulatory Commissions Act, 1998.

The notification is effective for Assessment Year 2026-27, corresponding to Financial Year 2025-26. Its operation is subject to the condition that the Commission continues to be constituted under the Electricity Regulatory Commissions Act, 1998 and continues to have one or more of the purposes specified in section 10(46A).

Why the 1961 Act still matters for this period

The notification specifically refers to the transitional provisions in section 536 of the Income-tax Act, 2025. Those provisions preserve the effect of earlier operations, rights, obligations and liabilities under the repealed 1961 Act and continue the old law for proceedings connected with tax years beginning before 1 April 2026.

This is important from a compliance perspective because the legal transition does not mean that every matter relating to earlier periods instantly moves to the new Act. For relevant pre-transition periods, the 1961 Act continues to govern specified proceedings and consequences. Notification No. 116/2026 therefore places the Maharashtra Electricity Regulatory Commission within the notified-body exemption framework for the relevant assessment year under the outgoing law.

Notification No. 117/2026 carries the treatment into the new Act

Notification No. 117/2026 operates under the Income-tax Act, 2025. It has been issued using the powers conferred by Schedule VII, Table Serial No. 42, read with section 11 of the new Act.

Under this notification, the Central Government has notified the Maharashtra Electricity Regulatory Commission for the purposes of that Schedule VII entry. The notification states that it will be effective from Tax Year 2026-27.

The continuing condition is materially similar: the Commission must remain a commission constituted under the Electricity Regulatory Commissions Act, 1998 and must continue to perform one or more of the purposes specified in Schedule VII, Table Serial No. 42 of the Income-tax Act, 2025.

Practical significance for tax and finance teams

The two notifications should be read together as a transition measure rather than as unrelated exemptions. For professionals handling the Commission's tax reporting, assessments, litigation or related certifications, the applicable legal reference will depend on the period and proceeding involved.

- For Assessment Year 2026-27 relevant to Financial Year 2025-26, Notification No. 116/2026 links the exemption recognition to section 10(46A) of the Income-tax Act, 1961.

- From Tax Year 2026-27, Notification No. 117/2026 provides the corresponding recognition under section 11 read with Schedule VII of the Income-tax Act, 2025.

- The exemption recognition is conditional and depends on the Commission continuing to satisfy its statutory-status and purpose requirements.

- For proceedings concerning periods before 1 April 2026, section 536 of the 2025 Act remains relevant because it preserves the application of the repealed law in specified situations.

What CAs and tax professionals should verify

Professionals dealing with similar statutory bodies should not assume that a prior notification under the 1961 Act automatically settles the position under the new Act. The operative notification, relevant tax year, statutory status of the entity and conditions attached to the notification should all be checked before relying on an exemption position.

For the Maharashtra Electricity Regulatory Commission specifically, both notification numbers and their effective periods should be retained in the tax file so that return positions, assessments and any future correspondence can be mapped to the correct statutory framework.

Takeaway

CBDT's paired notifications create continuity for the Maharashtra Electricity Regulatory Commission across India's income-tax law transition. Notification No. 116/2026 covers the relevant assessment year under the Income-tax Act, 1961, while Notification No. 117/2026 carries the recognition into Tax Year 2026-27 under the Income-tax Act, 2025. The practical compliance point is to apply the correct notification and law to the correct period rather than treating the transition as a single undifferentiated change.

Key takeaway

Fresh paired CBDT notifications dated August 25, 2026 directly illustrate how notified-body tax treatment is being carried across the Income-tax Act transition, with practical value for CAs and tax teams handling statutory bodies.