Centre for Policy Research loses tax exemption status 

The Income Tax Department has cancelled the tax exemption status of the Centre for Policy Research

The Income Tax Department has cancelled the tax exemption status of the Centre for Policy Research (CPR), a leading public policy research institution. The status was revoked on June 30.

The office of the Delhi-based think tank was surveyed by the Income Tax Department on September 7, 2022.

On February 27, the Ministry of Home Affairs (MHA) suspended the Foreign Contribution Regulation Act (FCRA) registration of CPR for 180 days. The registration made CPR eligible to receive foreign funds.

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The I-T Department issued a show cause notice to CPR in December 2022 asking why its tax exemption registration under Section 12A of the Income Tax Act should not be cancelled in view of several irregularities. The I-T Department alleged that the association had made payments to persons who had not filed their personal Income Tax Returns and raised questions over books published by the CPR being commercial in nature. 

The association denied the allegations and filed exhaustive replies with the department, a functionary said, adding that they would seek all forms of recourse available.

The functionary added that since the FCRA registration had been suspended, CPR had to significantly cut down its staff strength by more than half. Before the raids, there were around 200 employees on CPR’s payroll. Foreign donations comprised 75% of the total grants the charitable association received.