/ EV × 115BAB × PLI Specialist · Updated 2026-10-22

CA for EV Startup Section 115BAB + PLI Combined India, 15% corporate tax + up to 18% PLI stacked.

EV / battery startup can combine Section 115BAB (15% corporate tax) + Auto Components PLI (18% incentive on advanced products) + ACC Battery PLI (up to USD 2.5B subsidy pool) + FAME-III EV subsidy + state EV policy benefits. Combined incentive stack can equate to 15-30% capex + 5-10% operating subsidy. Here's how BQP structures the full stack.

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Written by CA Durgesh Chavda

Chartered Accountant (ICAI) · Founder, Bharat Quantum Prospera · US incorporation, India-US DTAA, FEMA ODI, NRI taxation, cross-border structuring · LinkedIn

/ The combined incentive stack

Five concurrent benefits.

Section 115BAB (15% corporate tax): for new manufacturing company incorporated post Oct 2019 commencing production by extended date. Effective 17.16% including surcharge + cess vs standard 25% / 22%.
Auto Components PLI: 18% incentive on advanced products (motor controller, battery management, drivetrain, infotainment). Nodal MHI.
ACC Battery PLI: up to USD 2.5B subsidy pool for Advanced Chemistry Cell battery manufacturing. Nodal DHI.
FAME-III: EV + charging infrastructure + e-bus subsidies. Nodal MoHI.
State EV policies: Maharashtra, Tamil Nadu, Karnataka, Delhi, Gujarat - land + capex + SGST reimbursement + electricity rebate + stamp duty. 10-25% additional state subsidy depending on state + sector.

Combined effect: For INR 5,000 crore EV / battery investment, central PLI + state incentive stack can reach INR 2,000+ crore (40%+ subsidy). Section 115BAB adds 7-8% recurring tax saving on profit stream.

/ Section 115BAB specific EV considerations

Where EV eligibility works + doesn't.

Yes - 115BAB applies: new EV / battery manufacturing company that makes articles or things.
No - 115BAB doesn't apply: service companies (EV fleet operation, charging-service operation, logistics-platform even if EV-based).
Charging infrastructure: pure charging-station operation is service - 115BAA (22%). Charging station as part of manufacturing + service bundle: 115BAB on manufacturing component only.
Battery recycling: specifically eligible under 115BAB if producing new article (recycled battery material / chemicals).
Specific disallowances under 115BAB: no Section 10AA SEZ, no Section 35 scientific research, no Section 32(1)(iia) additional depreciation. Model carefully if these were planned.

/ PLI application pathway

6-12 months to Letter of Approval.

Sector eligibility analysis across Auto Components / ACC Battery / adjacent PLI schemes.
Indian subsidiary setup + Section 115BAB opt-in via Form 10-ID.
Project proposal: capex + sales forecast + local value add + employment plan.
Application to nodal ministry (MHI for Auto Components; DHI for ACC Battery; MoHI for FAME-III).
Approval + Letter of Approval (LoA).
State industrial policy incentive negotiation (land + capex + SGST + electricity).
Project execution + production commencement.
Annual claim submission with project monitoring agency verification.
Disbursement over 5-year scheme period.

/ Our scope for EV / battery startups

Full stack.

Indian subsidiary structuring + Section 115BAB opt-in.
Auto Components PLI + ACC Battery PLI application + 5-year disbursement coordination.
FAME-III EV subsidy application.
State EV incentive negotiation (location-specific).
GST 5% on EV + input tax structure optimisation.
Customs duty + FTA preferential rate (UAE CEPA, Australia ECTA) for imported components.
CPCB battery EPR compliance.
ESOP + fundraising + Form 3CEB TP for foreign-parent EV subsidiaries.

Last updated: 2026-10-22.

/ Ready when you are

EV / battery startup combining 115BAB + PLI?

Full stack: 115BAB + Auto Components / ACC Battery PLI + FAME-III + state EV + GST 5% + customs. BQP integrated engagement.

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FAQ

Common questions, answered.

Can an EV manufacturer get both 115BAB + PLI?

Yes - these are stackable. Section 115BAB (15% corporate tax) is Income Tax provision; PLI is Government scheme cash incentive on incremental sales. Both apply simultaneously. Must opt into 115BAB via Form 10-ID at first ITR filing. PLI application separately to nodal ministry.

What's the combined incentive stack value for INR 5,000 crore EV investment?

Approximate stack: ACC Battery / Auto Components PLI up to 50% capex subsidy = INR 2,500 crore. State incentives 20-25% capex + SGST reimbursement + electricity = INR 1,000 crore. Section 115BAB: 7-8% recurring tax saving on annual profit. FAME-III: project-dependent additional. Total realised stack: INR 3,500+ crore over 5-7 years + ongoing 7-8% recurring tax saving.

Does Section 115BAB forfeit Section 10AA SEZ benefit?

Yes - 115BAB forfeits Section 10AA SEZ deduction. If SEZ based with 10AA eligibility, must model: 10AA 100% deduction for 5 years + 50% for next 5 years vs 115BAB 15% rate (effective 17.16%). Typically 115BAB better for profit-heavy mature business; 10AA better for high-margin early-stage SEZ operations.

Which Indian state is best for EV / battery manufacturing?

Depends on scope + supply chain. Gujarat (Dholera Semiconductor City adjacency + strong state policy). Tamil Nadu (established auto cluster, Chennai port, state EV policy). Maharashtra (Pune auto cluster, Mumbai port). Karnataka (Bengaluru design talent + Hosur manufacturing). Each state has specific EV / battery policy. BQP comparative analysis part of standard scope.

How long is PLI application + first disbursement timeline?

6-12 months from application to Letter of Approval. 12-24 months project execution to commence production. First PLI disbursement in year 1 of production. 5-year scheme period. Total: 6-7 years from PLI application to final disbursement.

Does BQP handle complete EV / battery incentive stack?

Yes - specialist EV / battery / cleantech practice. Section 115BAB + PLI (Auto Components, ACC Battery) + FAME-III + state EV incentive + GST 5% optimisation + customs + CPCB EPR + fundraising + ESOP. Co-ordinated with Indian industrial regulatory counsel + state industrial development authority. WhatsApp +91 78018 87130.