What are the eligibility criteria for a start-up to apply for Angel Tax exemption after obtaining recognition?

Once a startup is recognized by the Department for Promotion of Industry and Internal Trade (DPIIT), it may apply for tax exemption under Section 56(2)(viib) of the Income Tax Act, commonly known as the Angel Tax exemption. The eligibility criteria are as follows: Eligibility Criteria for Angel Tax Exemption: The startup must be recognized by DPIIT as a Startup under the Startup India initiative. The startup should be registered as a Private Limited Company or a Limited Liability Partnership (LLP) under the Companies Act, 2013 or LLP Act, 2008. Paid-up share capital: aggregate amount of paid-up share capital and share premium of the startup after issue or proposed issue of shares, if any, does not exceed, twenty-five crore rupees: Age of the Startup: The entity should not be older than 10 years from the date of incorporation. Turnover Limit: The startup's annual turnover should not exceed ₹100 crore in any financial year since its incorporation. Nature of Investment: The exemption applies only to investments made by resident investors, including angel investors, HNIs, and venture capital funds. Utilization of Funds: The funds received must be used for genuine business purposes and not for speculative or investment activities like purchasing shares, real estate, or lending, jewellery other than that held by the Startup as stock-in-trade in the ordinary course of business.