| Existing Provisions | Proposed Provisions |
| 1.Depositing back of corpus and repayment of loans or borrowings |
| As per section 10(23C) and section 11 when loan or borrowing is repaid from income of the previous year ,such repayment shall be allowed as application in the previous year in which it is repaid to the extent of such repayment. | As per section 10(23C) and section 11 application out of corpus or loan or borrowing before 01.04.2021 should not be allowed as application for charitable or religious purpose. |
| As per section 10(23C) and section 11 if the expenditure is made from a corpus fund it shall not be treated as application for charitable purpose in the year of expenditure. However, it shall be allowed as an application in the year such amount is replenished back to the corpus of such trust/institution. | As per section 10(23C) and section 11 if the expenditure is made from a corpus fund, it shall be treated as application for charitable purpose in the year of replenishment only if such investment or deposit is made back within a period of five years to the corpus from the end of previous year in which such application was made from the corpus. |
| if the expenditure is made by taking a loan or borrowing by the trust/institution it shall not be treated as application for charitable purpose in the year of expenditure. However, it shall be allowed as an application in the year such amount is loan or borrowing is returned to such trust/institution. | As per section 10(23C) and section 11 if the expenditure is made by taking a loan or borrowing by the trust/institution, it shall be treated as application for charitable purpose in the year of repayment only if such loan or borrowing is repaid back within a period of five years from the end of previous year in which such loan or borrowing was taken. |
| 2.Treatment of Donation to Other Trusts |
| Currently any voluntary contribution by registered fund or institution under 10(23)(c) or under section 11 to any other such similar fund or trust or institution is allowed as an application of income fully | Any voluntary contribution by registered fund or institution under 10(23)(c) or under section 11 to any other such similar fund or trust or institution is allowed as an application only to the extent of 85% of the voluntary contribution made by it. |
| Section 10(46) of the act provides exemption to any specified income arising to a body or authority or board or trust or commission or a class thereof which -: a) Has been established or constituted by or under a Central, State or provincial Act or constituted by Central Government or State Government, with the object of regulating or administering any activity for the benefit of General Public; b) Is not engaged in any commercial activity c) Is notified by Central Government in the Official Gazette for the purpose of this clause | This section shall apply to all cases except those which are specifically excluded by a new proposed section 10 (46)A, which is reproduced herein: -: a) Has been established or constituted by or under a Central, State or provincial Act or constituted by Central Government or State Government, with the object of regulating or administering any of the following activity for the benefit of General Public. 1. dealing with and satisfying the need for housing accommodation 2. planning, development or improvement of cities, towns and villages 3. regulating, or regulating and developing, any activity for the benefit of the general public; or 4. regulating any matter, for the benefit of the general public, arising out of the object for which it has been created |
| 3.Combining provisional and regular registration in some cases |
| New trusts under both regimes and under 80G need to apply for provisional registration/approval at least one month prior to the commencement of the previous year which will be valid for 3 years | The trust are now allowed to make provisional application only before the commencement of activities under 10(23C), 12A and 80G. |
| Provisionally registered/approved trust under both regimes and 80G will again need to apply for regular registration at least 6 months prior to the expiry of the provisional registration which will be valid for 5 years. | The trust shall be allowed to make an application for a regular approval under 10(23C), 12A and 80G if they have commenced their activities before making the application. |
| 4.Specified violations under section 12AB and fifteenth proviso to clause (23C) of section 10 |
| Currently the approval of the application for registration under section 12AB of the act vide form no 10A is an automated process. | The provision is being amended to ensure that if any documents or information submitted during the application is found to be inaccurate or false, then the Principal Officer may cancel the registration. |
| 5.Trusts or institutions not filing the application in certain cases |
| All existing trusts are required to apply for re-registration/approval on or before 31-01-2021 (which was extended to 25-11-2022). Such registration shall be applicable for a period of 5 years. new trusts under first/second regime are required to apply for registration one month prior to commencement of PY of the relevant FY, such registration will be valid for 3 years, the time limit in the case of provisionally registered/approved trusts is six months before the six months before the expiry of registration gets expired or within 6 months from the commencement of activities whichever is lower | If any trust fails to make an application for renewal in accordance with Sec. 10(23C) or under section 12 AB within the specified period i.e six months prior to the completion of 5 years in case of regular registration or 3 years in case of provisionally registered trust, then, it shall be deemed to have been converted into any form not eligible for registration or approval in the previous year in which such period expires, and the penal provisions as mentioned in section 115TD,TE,TF shall be applicable. Moreover, it is further provided that principal officer or the trustee of the trust shall also be liable to pay tax on accreted income within 14 days from the end of relevant previous year. Further, it is provided that the date of conversion shall be deemed to be last date of making an application for registration under Sec. 12AB and Sec. 10(23C). |
| 6.Alignment of the time limit for furnishing the form for accumulation of income and tax audit report |
| Accumulation of income for a period of 5 years (form 10) and application of income in any other cases (form 9A) are required to be filed at least one month prior to the due date as specified by section 139(1) i.e by 30th September. | IT is now proposed that accumulation of income for a period of 5 years (form 10) and application of income in any other cases (form 9A) are required to be filed at least one month prior to the due date as specified by section 139(1) i.e by 31st August. |
| 7.Denial of exemption where return of income is not furnished within time |
| As per the existing provision if return of Income is not furnished by trust under first regime within time specified under section 139 of the Act exemption under section 10(23C) (iv)/(v)/(vi)/(via), Section 11 and 12 shall not be available to such trust. | It is proposed that above exemption shall be available if return of Income has been furnished up to due date as mentioned under section 139(1) and 139(4) only. |
