Sections 151-152 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Sections 151 and 152 allow a resident individual a deduction from royalty income: section 151 for an author's income from the copyright of a book of a literary, artistic or scientific nature, and section 152 for a patentee's royalty on a patent registered on or after 1 April 2003. Each is capped at Rs. 300000. This article reads both as per the Income-tax Act, 2025 (30 of 2025) as amended by the Finance Act, 2026.
Under section 151 an individual author resident in India gets a deduction equal to the whole of the qualifying income or Rs. 300000, whichever is less. Under section 152 a resident individual patentee gets the same ceiling on royalty from a patent registered on or after 1 April 2003. For income from outside India, only the amount brought into India in convertible foreign exchange within six months of the end of the tax year counts, and a certificate must go with the return.
Where these sections sit
Both sections are in Chapter VIII, in the part for deductions in respect of certain incomes. The Act came into force on the 1st April, 2026 (section 1(3)). Check later amendments, rules and notifications.
For the Chapter, see Chapter VIII of the Income-tax Act, 2025. For the next provision, read our post on section 153 (deduction for interest on deposits). If you earn royalty and want the claim set up properly, our tax planning advisory team can help.
Section 151: royalty income of authors of certain books other than text-books
Section 151(1): who and what
Where, in the case of an individual who is an author resident in India, the gross total income includes any income derived by him in the exercise of his profession on account of:
- any lump sum consideration for the assignment or grant of any of his interests in the copyright of any book being a work of literary, artistic or scientific nature; or
- royalty or copyright fees (whether receivable in lump sum or otherwise) in respect of such book,
a deduction is allowed from that income, computed as set out in sub-section (2).
Section 151(2): the amount
The deduction is equal to the whole of such income, or an amount of Rs. 300000, whichever is less.
Section 151(3): royalty that is not a lump sum in lieu of all rights
Where the royalty or copyright fee is not a lump sum consideration in lieu of all rights of the assessee in the book, so much of the income, before allowing expenses attributable to it, as is in excess of 15% of the value of the books sold during the tax year is ignored for the purposes of the deduction.
Section 151(4) to (7): conditions
| Sub-section | Rule |
|---|---|
| (4) | For income earned from a source outside India, only so much of the income is taken into account as is brought into India by, or on behalf of, the assessee in convertible foreign exchange within six months from the end of the tax year in which it is earned, or within such further period as the competent authority may allow |
| (5) | No deduction unless the assessee furnishes a certificate in such form and manner as may be prescribed, duly verified by the person responsible for making the payment, along with the return of income, setting forth the prescribed particulars |
| (6) | No deduction on income earned from any source outside India unless the assessee furnishes a certificate in the prescribed form from the prescribed authority, along with the return of income in the prescribed manner |
| (7) | Where a deduction for any tax year has been claimed and allowed on any income referred to in the section, no deduction on that income is allowed under any other provision of this Act in any tax year |
The form and particulars of the certificates are left to the Income-tax Rules, 2026; see our rule-wise guides.
Section 151(8): definitions
- "author" includes a joint author;
- "books" do not include brochures, commentaries, diaries, guides, journals, magazines, newspapers, pamphlets, text-books for schools, tracts and other publications of similar nature, by whatever name called;
- "competent authority" means the Reserve Bank of India or such other authority as is authorised under any law in force for regulating payments and dealings in foreign exchange;
- "lump sum", for royalties or copyright fees, includes an advance payment on account of them which is not returnable.
A printing note: footnote 18 and a page break fall in the middle of section 151, between sub-sections (3) and (4). The footnote belongs to section 150, which is dealt with in our article on sections 148 to 150; section 151 itself continues from sub-section (4).
Section 152: royalty on patents
Section 152(1): who qualifies
An assessee who is an individual and who is:
- resident in India;
- a patentee;
- in receipt of income by way of royalty in respect of a patent registered on or after the 1st April, 2003 under the Patents Act, 1970 (39 of 1970); and
- having gross total income for the tax year that includes royalty,
is allowed a deduction from that income, computed as set out in sub-sections (2) to (7).
Section 152(2) and (3): amount and compulsory licences
The deduction is equal to the whole of the royalty income or Rs. 300000, whichever is less. Where a compulsory licence is granted for a patent under the Patents Act, 1970, the royalty for this purpose cannot exceed the royalty under the terms and conditions of a licence settled by the Controller under that Act.
Section 152(4) to (7): conditions
| Sub-section | Rule |
|---|---|
| (4) | Foreign income counts only to the extent brought into India in convertible foreign exchange within six months of the end of the tax year, or within such further period as the competent authority referred to in section 151(8)(c) may allow |
| (5) | No deduction unless a certificate in the prescribed form, duly signed by the prescribed authority, is furnished with the return, setting forth prescribed particulars |
| (6) | No deduction on foreign-source income unless a certificate in the prescribed form from the prescribed authority or authorities is furnished with the return |
| (7) | If a deduction has been claimed and allowed for a tax year on income referred to in the section, no deduction on that income is allowed under any other provision in any tax year |
Section 152(8): definitions
The sub-section defines, by reference to the Patents Act, 1970: "Controller" (section 2(1)(b)); "patent" (any patent granted, including a patent of addition); "patentee" (the true and first inventor recorded as patentee, including joint patentees recorded as such); "patent of addition" (section 2(1)(q)); "patented article" and "patented process" (section 2(1)(o)); and "true and first inventor" (section 2(1)(y)). "Lump sum" includes a non-returnable advance payment for royalties.
"Royalty" in respect of a patent means consideration for: (i) the transfer of all or any rights (including the granting of a licence) in respect of a patent; (ii) imparting information concerning the working or use of a patent; (iii) the use of any patent; or (iv) rendering services connected with (i) to (iii). It does not include consideration which (A) would be income of the recipient chargeable under the head "Capital gains", or (B) is for sale of a product manufactured with the use of a patented process or of the patented article for commercial use. The Patents Act, 1970 should be checked for each of the terms it supplies.
Worked examples
Names and amounts are invented; the Rs. 300000 ceiling and 15% limit are as printed.
Author. Ishaan Rao, a resident individual author, receives royalty of Rs. 4,50,000 for a scientific work, which is not a lump sum in lieu of all rights. Books worth Rs. 20,00,000 were sold in the tax year. Under section 151(3), income over 15% of Rs. 20,00,000 = Rs. 3,00,000 is ignored, so Rs. 3,00,000 is taken into account (Rs. 4,50,000 less the excess of Rs. 1,50,000). Under section 151(2), the deduction is the lesser of Rs. 3,00,000 and Rs. 300000, which is Rs. 3,00,000.
Patentee. Nandini Joshi, a resident individual and patentee of a patent registered after the 1st April, 2003, receives patent royalty of Rs. 2,10,000. The deduction under section 152(2) is the lesser of Rs. 2,10,000 and Rs. 300000: Rs. 2,10,000, provided the certificate under sub-section (5) is furnished with the return.
Need help with royalty deductions?
Whether a payment is a royalty or capital gains, whether a foreign receipt came in within six months and whether the certificate is ready all affect the claim. Our tax planning advisory service can check these points before you file.
Key takeaways
- Both deductions are the whole of the qualifying income or Rs. 300000, whichever is less.
- Section 151 is for an author resident in India; text-books for schools and the other listed publications are not "books".
- Section 152 needs a patent registered on or after 1 April 2003 and a patentee.
- Foreign income counts only to the extent brought into India in convertible foreign exchange within six months, or the further period allowed.
- A certificate must accompany the return, and no deduction is allowed twice on the same income.
Read next
- Sections 148 to 150: dividends, co-operative societies and federal co-operatives
- Section 153: deduction for interest on deposits
- Section 154: deduction for a person with disability
- Chapter VIII of the Income-tax Act, 2025
Disclaimer: Based on the Income-tax Act, 2025 (30 of 2025) as amended by the Finance Act, 2026, as consulted on 2 October 2026. It explains the words of the Act only; the Income-tax Rules, 2026, notifications, circulars, later amendments and the way the tax authorities and courts apply these provisions should be checked. This article is general information, not legal advice; check the official text before acting.