The Finance Act, 2020 has made changes leading to complete
overhaul in the registration process of charitable and religious organisations.
The procedure for registration of every organisation under the new scheme shall
be completely electronic under a centralised database.
The Income-tax Department shall issue a National Unique
Registration Number to all the charitable and religious institutions and
thereby creating a National Database of exempt entities.
A new section 12AB has been inserted with effect from 1st April,
2021 dealing with the procedure of registration. Earlier, trusts or institutions
were registered under section 12AA or under section 12A.
Further
provision of Section 10(23C) and 35 has also been amended. These amendments were
originally introduced by the Finance Act, 2020 effective from 1St June
2020, However, due unprecedent economic crisis, the government passed “The Taxation and Other Laws (Relaxation And Amendment Of Certain Provisions) Act, 2020” as on 29th
September 2020 to defer the implementation of new procedure and make it effective
from 1st April 2021.
Further
the rules relating to the provisions has also been amended by Notification 26th
March 2021
From 10A and 10AB has been prescribed in these new rules for
the registration of the Trust U/s 12A & 80G and approval U/s 10(23C) sub-clause
(iv) or (v) or (vi) or (via) & 35(1) sub-clause.
As per New law Form 10A or 10AB is required to be filed for re-registration/ fresh registration or approval as the case may be. Let’s find out who require to fill Form 10A and 10AB?
From-10A:
Cases where Form-10A required to fill
- Trust/Institute
already registered under the previous law effective immediately before
this amendment (i.e., before 1st April 2021)
-
Fund or trust or institution or any
university or other educational institution or any hospital or other medical
institution referred to in sub-clause (iv) or (v) or (vi) or (via) of section
10(23C) approved under the first proviso
-
Trust/ Institute registered under section 12A
or 12AA
-
Institution/fund approved under the clause
(vi) of section 80G(5)
-
research association, university, college or
other institution referred to in clause (ii) or clause (iii) or the company
referred to in clause (iia) of section 35(1)
Time limit:
The time limit of 3months from the date on which the provision
came into force. i.e., 30th June 2021 is the time limit for
application as the effective date is 1st April 2021.
- Trust/institute not
registered under the previous law and want to make an application for fresh
Registration or Approval under the new law or any other case then it
required to file Form 10A.
-
Fund or trust or institution or any
university or other educational institution or any hospital or other medical
institution referred to in sub-clause (iv) or (v) or (vi) or (via) of section
10(23C) approved under the first proviso clause (iv)
-
Trust/ Institute – [ sub
clause(vi) Clause (ac) of section 12A(1)]
- Institution/fund approved under the clause (vi) of section 80G(5) [ proviso clause (vi)]
Time
Limit: At least one month prior to the commencement of the
previous year relevant to the assessment year from which the said approval is
sought
Note: List of Documents to be attached is given below the FORM-10A
From-10AB:
Cases where Form-10AB required to fill
- Trust/ Institute registered
or approved as per the new law effective from the 1st April 2021
and the period of approval is due to expire.
-
Fund or trust or institution or any
university or other educational institution or any hospital or other medical
institution referred to in sub-clause (iv) or (v) or (vi) or (via) of section
10(23C) approved under the first proviso effective from 1st April
2021
-
Trust/ Institute registered under section 12AB
- Institution/fund approved under the proviso of clause (vi) of section 80G(5) effective from 1st April 2021
Time
Limit: Trust/ Institute should apply at least 6 months prior to
the expiry of the period.
- Trust/ Institute provisionally
registered* or Provisionally approved* as per the new law effective from the
1st April 2021 and the period of Provisional approval is due to
expire or activities has been commenced
-
Fund or
trust or institution or any university or other educational institution or any
hospital or other medical institution referred to in sub-clause (iv) or (v) or (vi)
or (via) of section 10(23C) approved under the first proviso effective from 1st
April 2021
-
Trust/ Institute registered under section 12AB
- Institution/fund approved under the proviso of clause (vi) of section 80G(5) effective from 1st April 2021
Time Limit : Trust/
Institute should apply
-
At least 6 months prior to the expiry of
the period
Or
- Within 6 Months from the date of commencement of its activities
- Trust / institution has become inoperative due to the first proviso to sub-section (7) of section 11 [ sub clause(iv) Clause (ac) of section 12A(1)].
Time
Limit : At least six months prior to the commencement of the
assessment year from which the said registration is sought to be made operative.
- where the trust or institution has adopted or undertaken modifications of the objects which do not conform to the conditions of registration [sub clause (v) Clause (ac) of section 12A(1)]
Time Limit: Within a
period of 30 days from the date of such adoption or modification.
Note: List of Documents to be attached is given below the FORM-10AB
*Provisional approval or registration will be given for a period of 3 years from the assessment year from which registration is sought
**Approval or Registration will be given for a period 5 years
Relevant Rules: Rule2C, Rule5C, Rule11AA and Rule17A
Disclaimer: The contents of this article have been prepared in accordance with the relevant provisions, and information available at the time of preparation. The views and opinions expressed in this article are those of the author and the author does not take any responsibility and cannot guarantee that no inaccuracy occurs.