Section - 12A - Clarity of procedure in
respect of change or modifications of object and filing of return of income in
case of entities exempt under sections 11 and 12
The existing provisions provide
for conditions for applicability of sections 11 and 12 in relation to the
benefit of exemption in respect of income of any trust or institution.
Section 12AA of the Act provides
for registration of the trust or institution which entitles them to the benefit
of sections 11 and 12 and the circumstances under which registration can be
cancelled, one such being satisfaction of the Principal Commissioner or
Commissioner that its activities are not genuine or are not being carried out
in accordance with its objects subsequent to grant of registration. However, at
present there is no explicit provision in the Act which mandates said trust or
institution to approach for fresh registration in the event of adoption or
undertaking modifications of the objects after the registration has been
Therefore, it is proposed to
amend section 12A so as to provide that where a trust or an institution has
been granted registration under section 12AA or has obtained registration at
any time under section 12A and, subsequently, it has adopted modifications of
the objects which do not conform to the conditions of registration, it shall be
required to obtain fresh registration by making an application within a period
of thirty days from the date of such adoption or modifications of the objects
in the prescribed form and manner.
Further, as per the existing
provisions of said section, the entities registered under section 12AA are
required to file return of income under sub-section (4A) of section 139, if the
total income without giving effect to the provisions of sections 11 and 12
exceeds the maximum amount which is not chargeable to income-tax. However,
there is no clarity as to whether the said return of income is to be filed
within time allowed u/s 139 of the Act or otherwise.
In order to provide clarity in
this regard, it is proposed to further amend section 12A so as to provide for
further condition that the person in receipt of the income chargeable to
income-tax shall furnish the return of income within the time allowed under
section 139 of the Act.
amendment will be effective from 1st April 2018.