Union Budget 2010-2011

To further encourage R&D across all sectors of the economy, weighted deduction on expenditure incurred on approved in-house R&D units under section 35(2AB) of Income tax Act, enhanced from 150 per cent to 200 per cent.
Weighted deduction on payments made to National Laboratories, Universities or IITs or a specified person, with a specific direction that the said sum shall be used for scientific research undertaken under an approved programme u/s 35(2AA) of Income tax Act, enhanced from 125 per cent to 175 per cent.
Payments made to associations engaged in research approved u/s 35(1)(ii) & (iii) of Income tax Act to be allowed as weighted deduction of 175 per cent. The income of such approved research associations shall also be exempt from tax.