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Description
The issue of taxation of charity has been viewed liberally, both in England and in India, acknowledging the need for preservation, support and encouragement of charitable and religious institutions. Government allowed and has continued to allow exemption from tax for fostering philanthropy. To that extent, law was simple in the beginning. But, in course of time, public trusts becoming a convenient device for tax avoidance, misuse of trust fund and property in the garb of charity, the simple laws became complicated, at times difficult to comprehend, in the process of plugging the loopholes over the years. It thus emerged as a specialized field of activity in income-tax - different from other taxable entities.
Focus and coverage
The focus of this treatise is to present the complex laws of charity in a simple, lucid and systematic manner for the benefit of persons dealing with public trusts or societies, tax officials and tax practitioners. The subject is no doubt hazy and complex so much so that it is prone to confusion. Moreover, there is general lack of awareness among the persons managing the affairs of trust. The obvious result is inadequate or incorrect compliance of statutory obligations prescribed by law to help monitor the application of income for genuine purposes. The altruism must be in thought as well as in action. The author has made an ambitious venture to highlight all the provisions of law relating to taxation of charity added with commentaries with new height of reliability. His expertise as a taxman and deep insights from longtime association with NGOs were very helpful in unfolding the application of the laws in appropriate way as intended by the legislature. Important decisions of the Supreme Court and High Courts which helped in crystallizing the law have been referred to in all relevant provisions.
Distinguishing features
The presentation of the treatment of business income of a trust with progressive development of changes in law and perspective emerged over the years is the most distinguishing feature. Amplitude of business incidental to attainment of objects of the trust. A business with profit motive or profit feeding the charity - the distinction has been explained with legal clarity. The book has been designed to be a helpful companion for all concerned.
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Contents
Part I - Exemption of Income of Trust
Chapter 1. Trust - A Brief Overview
Chapter 2. Preliminary - Important Definitions, Terms & Concepts
Chapter 3. Charity and its Implications
Chapter 4. Religious Purposes
Chapter 5. Income
Chapter 6. Voluntary Contributions
Chapter 7. Exemption of Trust in the Conspectus of Tax Laws
Chapter 8. Application of Income - Judicial Interpretations
Chapter 9. Capital Gain - section 11 (1A)
Chapter 10. Accumulation or Set-off
Chapter 11. Specified Modes of Investments
Chapter 12. Sections 60 to 63 Preclude Section 11
Chapter 13. Treatment of Business Activities by a Trust
Chapter 14. Forfeiture of Tax Exemption
Chapter 15. Registration under Section 12AA
Chapter 16. Compulsory Audit and Requirement of Filing Audit Report
Chapter 17. Organizations Exempted under Section 10
Chapter 18. Rebate to Donors on Donation made for Charity
Chapter 19. Deduction on Expenditure on Scientific Research
Chapter 20. Deduction on Eligible Projects or Schemes
Chapter 21. Mutual Benefit Society
Chapter 22. Taxability of Private Trusts
Chapter 23. Assessment Procedure
Chapter 24. Miscellaneous
Part II - Glimpses of Foreign Contribution (Regulation) Act, 1976
Part III - Frequently Asked Questions
Part IV - Appendices
Appendix 1. Relevant Sections of the Income Tax Act, 1961
Appendix 2. Relevant Forms of the Income Tax Rules, 1962
Appendix 3. Excerpts from Relevant Important Circulars on Exemptions (Sectionwise)
Appendix 4. Important Forms of Foreign Contribution (Regulation) Rules, 1976
Appendix 5. Miscellaneous
Appendix 6. Model Deeds
Index
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Author Details
Swapan Kumar Mukhuty, MSc, MA, PhD, Former Additional Director of Income-tax (Exemption), Kolkata
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