CBDT Expands Tax Recognition to Infrastructure Sub-Sectors Under Income-tax Act, 2025

In a significant move aimed at supporting India's infrastructure development agenda, the Central Board of Direct Taxes (CBDT) has issued Notification No. 70/2026 dated June 1, 2026, bringing a wider range of infrastructure-related businesses within the ambit of eligible businesses under the Income-tax Act, 2025.

The notification has been released by the Ministry of Finance, Department of Revenue, under the authority granted by Section 11(5) read with Note 5(d)(ii) of Schedule V [Table: Sl. No. 7] of the Income-tax Act, 2025.

Infrastructure Businesses Granted Specified Status

Through this notification, the Central Government has officially recognized businesses operating in infrastructure sub-sectors included in the Updated Harmonised Master List of Infrastructure Sub-Sectors, published by the Department of Economic Affairs (DEA) vide notification F. No. 13/1/2025-IPP dated September 19, 2025.

As a result, eligible businesses engaged in these notified infrastructure segments, excluding those already covered under Note 5(d)(i) of Schedule V, will now qualify as "specified businesses" for the purpose of Schedule V [Table: Sl. No. 7] of the Income-tax Act, 2025.

This development broadens the scope of infrastructure activities recognized under the country's revised tax framework and reflects the government's commitment to strengthening infrastructure-led economic growth.

Alignment with National Infrastructure Policies

The latest notification creates a direct linkage between tax eligibility and the government's official infrastructure classification framework. The Updated Harmonised Master List of Infrastructure Sub-Sectors serves as a comprehensive reference covering various critical sectors, including:

• Transportation and logistics
• Energy and power infrastructure
• Water supply and sanitation projects
• Communication and digital infrastructure
• Social infrastructure
• Other strategic infrastructure sectors identified by the Government of India

By adopting a unified infrastructure classification system, the government seeks to ensure consistency across taxation policies, financing mechanisms, investment frameworks, and infrastructure development programs.

Benefits for Infrastructure Sector Businesses

The notification is expected to provide greater certainty and regulatory clarity to companies operating within eligible infrastructure sub-sectors. By formally recognizing these businesses under Schedule V of the Income-tax Act, 2025, the government has strengthened the tax framework applicable to infrastructure investments.

Industry stakeholders believe that the move could encourage increased private and institutional participation in infrastructure projects by offering a clearer tax treatment and reducing ambiguity regarding eligibility under the Act.

The decision is also likely to complement India's long-term objective of accelerating infrastructure creation and attracting capital into key development sectors.

Effective Date

According to the CBDT notification, the provisions will come into force from June 1, 2026, the date on which the notification was published in the Official Gazette.

Short Summary

The CBDT has issued Notification No. 70/2026 recognizing eligible infrastructure sub-sector businesses as "specified businesses" under the Income-tax Act, 2025. The move aligns tax provisions with the government's harmonized infrastructure framework and is expected to enhance investment and policy clarity for infrastructure projects.