2. Registration of Existing Charitable Trust or
Institution Registered u/s 12A / 12AA / 10(23C) /
80G
As per amendment in section 10(23C), 12A, 12AA, 80G and insertion of new section 12AB, all
the existing Charitable Trust or Institution needs to register themselves again w.e.f 01/06/2020.
1. Application for registration is to be made to the Principal Commissioner or Commissioner of
Income Tax within 3 months from the date of amendment came into force i.e. 3 months
from 01/06/2020 i.e. application is to be made till 31/08/2020 unless and until it is extended
further.
2. Maximum period for which registration will be granted is 5 years. The Trust or Institution has
to again renew its registration before expiry of 5 years.
3. Order of Approval or Order of Rejection has to be passed within 3 months from the end of
the month in which the application was received.
4. Exemption is available to the Trust or Institution from the Assessment Year from which
approval was earlier granted to it.
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3. Registration of New Charitable Trust or
Institution
As per amendment in section 10(23C), 12A, 12AA, 80G and insertion of new section 12AB, new
Charitable Trust or Institution needs to register themselves as per new prescribed procedure.
1. Application for registration is to be made to the Principal Commissioner or Commissioner of
Income Tax atleast 1 month prior to the commencement of the previous year relevant to the
assessment year from which the registration is sought.
2. Provisional Registration will be granted for 3 years. The Trust or Institution has to apply for
Final Registration, after getting provisionally registered, as soon as it has fulfilled prescribed
condition.
3. Order of Approval or Order of Rejection has to be passed within 1 month from the end of
the month in which the application was received.
4. Exemption is available to the Trust or Institution from the Assessment Year immediately
following the financial year in which such application was made.
5. Application for New Registration already made before the said amendment came into force
and pending for approval shall be deemed to be pending under the new provisions.
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4. Final Registration of Provisionally
Registered Charitable Trust or Institution
As per amendment in section 10(23C), 12A, 12AA, 80G and insertion of new section 12AB, new Charitable Trust or
Institution needs to provisionally register and then apply for final registration as per new prescribed procedure.
1. Application for registration is to be made to the Principal Commissioner or Commissioner of Income Tax
atleast 6 months prior to expiry of the period of provisional registration or within 6 months of
commencement of its activities, whichever is earlier.
2. Maximum period for which registration will be granted is 5 years. The Trust or Institution has to again renew
its registration before expiry of 5 years.
3. The Principal Commissioner or Commissioner of Income Tax shall pass an order after satisfying himself about
the objects of the Trust or Institution and genuineness of its activities and compliance of such requirements
of any other law for the time being in force applicable to the said Trust or Institution.
4. The Principal Commissioner or Commissioner of Income Tax shall provide a reasonable opportunity of being
heard to the Trust or Institution before rejecting the application of registration or cancelling its registration.
5. Order of Approval or Order of Rejection has to be passed within 6 months from the end of the month in
which the application was received.
6. Exemption is available to the Trust or Institution from the Assessment Year from which it was provisionally
registered.
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5. Renewal of Registration of Registered
Charitable Trust or Institution
As per amendment in section 10(23C), 12A, 12AA, 80G and insertion of new section 12AB, Charitable Trust or
Institution registered after amendment and whose registration is due to expire needs to renew its registration.
1. Application for renewal of registration is to be made to the Principal Commissioner or Commissioner of
Income Tax atleast 6 months prior to expiry of the said period of registration.
2. Maximum period for which registration will be renewed is 5 years. The Trust or Institution has to again renew
its registration before expiry of 5 years.
3. The Principal Commissioner or Commissioner of Income Tax shall pass an order after satisfying himself about
the objects of the Trust or Institution and genuineness of its activities and compliance of such requirements
of any other law for the time being in force applicable to the said Trust or Institution.
4. The Principal Commissioner or Commissioner of Income Tax shall provide a reasonable opportunity of being
heard to the Trust or Institution before rejecting the application of registration or cancelling its registration.
5. Order of Approval or Order of Rejection has to be passed within 6 months from the end of the month in
which the application was received.
6. Exemption is available to the Trust or Institution from the Assessment Year immediately following the
financial year in which such application was made.
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6. Amendment to Section 11(7)
As per amendment in section 11(7), a Charitable Trust or Institution can take exemption either
u/s 11 & 12 or u/s 10(23C) / 10(46).
Registration of Charitable Trust or Institution taking exemption u/s 11 & 12 will become
inoperative from date on which such Trust or Institution is approved u/s 10(23C) or is notified
u/s 10(46), as the case may be, or date on which such amendment came into force i.e.
01/06/2020 whichever is later.
The Charitable Trust or Institution whose registration has become inoperative may apply to get
its registration operative u/s 12AB. However, after doing so the exemption u/s 10(23C) or
notification u/s 10(46) shall not be available to such Trust or Institution from the date on which
it becomes operative and thereafter.
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7. Revival of Registration of Charitable Trust or
Institution whose Registration has became
Inoperative due to Sec 11(7)
1. Application for revival of registration is to be made to the Principal Commissioner or
Commissioner of Income Tax atleast 6 months prior to the commencement of the assessment
year from which the said registration is sought to be made operative.
2. Maximum period for which registration will be granted is 5 years. The Trust or Institution has to
again renew its registration before expiry of 5 years.
3. The Principal Commissioner or Commissioner of Income Tax shall pass an order after satisfying
himself about the objects of the Trust or Institution and genuineness of its activities and
compliance of such requirements of any other law for the time being in force applicable to the
said Trust or Institution.
4. The Principal Commissioner or Commissioner of Income Tax shall provide a reasonable
opportunity of being heard to the Trust or Institution before rejecting the application of
registration or cancelling its registration.
5. Order of Approval or Order of Rejection has to be passed within 6 months from the end of the
month in which the application was received.
6. Exemption is available to the Trust or Institution from the Assessment Year immediately
following the financial year in which such application was made.
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8. Revival of Registration of Charitable Trust or
Institution which has adopted or undertaken
modifications of the objects
The Charitable Trust or Institution which has adopted or undertaken modifications of the objects which do not
conform/comply to the conditions of registration has to revive its registration.
1. Application for revival of registration is to be made to the Principal Commissioner or Commissioner of Income
Tax within 30 days from the date of such adoption or modification.
2. Maximum period for which registration will be granted is 5 years. The Trust or Institution has to again renew
its registration before expiry of 5 years.
3. The Principal Commissioner or Commissioner of Income Tax shall pass an order after satisfying himself about
the objects of the Trust or Institution and genuineness of its activities and compliance of such requirements
of any other law for the time being in force applicable to the said Trust or Institution.
4. The Principal Commissioner or Commissioner of Income Tax shall provide a reasonable opportunity of being
heard to the Trust or Institution before rejecting the application of registration or cancelling its registration.
5. Order of Approval or Order of Rejection has to be passed within 6 months from the end of the month in
which the application was received.
6. Exemption is available to the Trust or Institution from the Assessment Year immediately following the
financial year in which such application was made.
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9. Consequences in case of failure to take
registration or Cancellation of Registration –
Sec 115TD
Section 115TD will be applicable in case the Charitable Trust or Institution fails to take
registration or the registration of the Trust or Institution is cancelled.
As per section 115TD, the Trust or Institution has to pay additional Income Tax at the Maximum
Marginal Rate on the Accreted Income .
Such tax on Accreted Income will be in addition to normal income tax payable on Total Income
of the Trust or Institution.
Accreted Income = Aggregate Fair Market Value of the Total Assets of the Trust – Total Liability
of the Trust computed as per prescribed method.
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10. Cancellation of Registration of Trust or
Institution
As per sub section (4) & (5) of Section 12AB, Principal Commissioner or Commissioner of Income
Tax has powers to cancel the registration of the Trust or Institution in following circumstances:
1. Where the Principal Commissioner or Commissioner of Income Tax is satisfied that the
activities of the Trust or Institution are not genuine or are not being carried out in
accordance with the objects of the Trust or Institution, or
2. Where the Trust or Institution is no longer eligible to claim exemption u/s 11 & 12 due to
provisions of section 13(1), or
3. Where the Trust or Institution has failed to comply with the requirement of any other law
for the time being in force applicable to the said Trust or Institution.
The Principal Commissioner or Commissioner of Income Tax shall give a reasonable opportunity
of being heard before passing the order of cancellation of registration.
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11. Annual Statement of Donation, Audit
Report And Income Tax Return
1. Charitable Trust or Institution which receives Donation has to file Annual Statement of
Donation, w.e.f 01/06/2020, in which complete details of Donor as well as Donation
Received is to be filed.
2. This statement has been introduced keeping in mind Concept of Cross Checking of Donation.
Deduction u/s 80G to the Donor shall be allowed only if the details of such donation is
available in the statement filed by the Donee.
3. Late fees of Rs. 200/- per day shall be levied u/s 234G in case of delay in filing of such
statement.
4. Minimum Penalty of Rs. 10,000/- (maximum Rs. 1,00,000/-) u/s 271K may be levied by the
Assessing Officer in case of failure to furnish such statement.
5. As amended by Finance Act, 2020, the due date to file Audit Report in Form 10B/10BB is 30th
September of the assessment year and the due date to file Income Tax Return is 31st
October of the assessment year.
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12. SHAH JAIN & ASSOCIATES 12
THANK YOU
Shah Jain & Associates
Chartered Accountants
601, 6th Floor, Rajesh Rayon Bhawan,
Opp. Kakad Market, Kalbadevi Road,
Mumbai – 400002.
Contact
CA Priyank Shah : +919773568946
CA Amit Jain : +919773398194
CA Bharat Jain : +919920496581
Email
office@shahjain.in
