Tax exemption for approved research institutions requires dedicated research use, audited accounts, and certified donation statements. Approval under section 35(1)(ii) is granted to NIMHANS as a 'University, College or Other Institution' subject to conditions: sums paid must be used for scientific research conducted by faculty or enrolled students; separate books of account for research receipts and expenditure must be maintained and audited by a qualified accountant with the audit report furnished to the tax authority by the income tax return due date; and a departmental, auditor certified statement of donations received and amounts applied to research must accompany the audit report. Approval may be withdrawn for failures in recordkeeping, reporting, genuine research activity, or compliance with the section and rules.