Chapter IVwas s.35CCC, s.35CCD

Section 47 of the Income-tax Act, 2025

Section 47 — Expenditure on agricultural extension project and skill development project. Successor to s.35CCC, s.35CCD of the 1961 Act.

Where this section sits

Section 47 is in Chapter IV — Computation of Total Income, which runs from section 13 to section 95.

← Section 46 · Section 48 →

What this section does

Sub-section (1) allows a deduction, in the tax year in which it is incurred, for any expenditure incurred on an agricultural extension project by any assessee, or on any skill development project by a company. The cost of any land or building is excluded from the expenditure that qualifies. The deduction is available only if the project is notified by the Board as per the guidelines issued by it.

Sub-section (2) is a bar on double deduction: where a deduction under this section is claimed and allowed for any tax year in respect of expenditure referred to in sub-section (1), no deduction for that expenditure shall be allowed under any other provision of the Act, for the same or any other tax year.

Why it is there

Agricultural extension and skill development are activities a business will not fund at the level the economy needs, and the section buys that spending by making it deductible in the year it is incurred. Excluding land and building keeps the incentive attached to the programme rather than to real estate, and the notification requirement puts the Board in control of what counts as a project.

Who it applies to

Any assessee incurring expenditure on an agricultural extension project
A company incurring expenditure on a skill development project
The Board, notifying the project as per the guidelines issued by it

What this means in practice

The two limbs are not symmetrical: an agricultural extension project is open to any assessee, but the skill development deduction is confined to a company, so a firm or limited liability partnership running a training programme falls outside clause (b). Notification is a condition of the deduction, not a formality. And because sub-section (2) bites once the deduction is claimed and allowed, the same expenditure cannot be routed through any other provision in that or any later year.

An example

Illustrative only, and invented for this page. The figures are chosen to show the rule biting, not taken from any real matter.

A company spends Rs. 3 crore in a tax year on a skill development programme notified by the Board, of which Rs. 80 lakh is a building put up to house the training centre. The deduction is Rs. 2.2 crore; the building cost is excluded by the opening words of sub-section (1). Having claimed it, the company cannot claim the same spend again elsewhere.

Where you meet this section

It is a claim in the business computation filed with the return, supported by the Board's notification of the project — and that notification is the first thing an Assessing Officer asks for when the claim is examined.

The words themselves

shall be allowed as a deduction, in the tax year in which such expenditure is incurred provided such project is notified by the Board as per the guidelines issued by it

Section 47(1), Income-tax Act, 2025.

What people get wrong

Claiming a skill development deduction for a non-corporate assessee. Sub-section (1)(b) confines that limb to a company.
Including land or building cost. The opening words of sub-section (1) exclude it.
Claiming before the project is notified. Notification by the Board is a condition in sub-section (1).
Claiming the same expenditure under another provision. Sub-section (2) bars it in the same or any other tax year.

What this replaced

The correspondence is the Income Tax Department’s own, from its comparison utility for the 1961 and 2025 Acts. A renumbering is the easy half; whether the words changed is the half that decides cases.

35CCC - Expenditure on agricultural extension project
35CCD - Expenditure on skill development project

See the full 1961 to 2025 concordance.

Rules that serve this section

Rules of the Income-tax Rules, 2026 that work section 47. Where the rule’s own heading names the section we say so; the rest are marked on reading the rule, which is our derivation and not the department’s. A rule that serves the section silently and that we have missed will not appear here.

Rule 37 — Procedure for approval of agricultural extension project under section 47(1)(a)
Rule 38 — Conditions for notification of agricultural extension projects under section 47(1)(a)
Rule 39 — Procedure for approval of skill development projects under section 47(1)(b)
Rule 40 — Conditions subject to which a skill development project is to be notified under section 47(1)(b)

All of them are in the Rules 2026 index.

Notifications that reach this section

A notification is made under a power the Act gives and, within that power, is law. These too were made under the 1961 Act and are placed here by the department’s concordance.

Notification No. 47/2021 [F.No. 203/31/2014-ITA.II] / SO 1765(E) — Ministry of Finance 2021-05-06
Notification No. 48/2021 [F.No. 203/30/2014-ITA.II]/ SO 1766(E) — Ministry of Finance 2021-05-06
Notification No. 49/2021 [F. No. 203/29/2014-ITA.II]/ SO 1767(E) — Ministry of Finance 2021-05-06
Notification No. 54/2015 [F.No. 203/23/2015-ITA.II] — Government of India 2015-06-26
Notification No. 14/2015 [F.No.203/31/2014/ITA.II] — Section 35CCC of the Income-tax Act, 1961 - Expenditure on Agricultural Extension Project - Notified Eligible Agricultural Extensi 2015-02-16
Notification No. 15/2015 [F.No.203/30/2014/ITA.II] — Section 35CCC of the Income-tax Act, 1961 - Expenditure on Agricultural Extension Project - Notified Eligible Agricultural Extensi 2015-02-16
Notification No. 16/2015 [F.No.203/29/2014/ITA.II] — Section 35CCC of the Income-tax Act, 1961 - Expenditure on Agricultural Extension Project - Notified Eligible Agricultural Extensi 2015-02-16

See the notifications index.

What this page does not tell you. It does not reproduce the section. Everything above was written from the section’s own text as the Income Tax Department publishes it — the text is here, and nothing here is advice on your facts. Where a figure matters, read the sub-section it comes from.