1.

Trust already registered u/s 12AA as on 01/04/2021

Description

Relevant Provision of the Act

Relevant Rule

Relevant Form and Manner of Filing

Who can sign and how to sign

Document Required

Whether Commissioner can call further information to satisfy himself about the genuineness of activities of the trust

Time limit for making an application

Time limit for passing an order

Validity of Registration

Consequences
2. Application for registration u/s 12AA is pending as on 01/04/2021

Description Remarks

Relevant Provision of the Act Section 12AB(2) and 12A(1)(ac)(vi) (refer the section 12AB(2) which provides

Relevant Rule Rule 17A(1)(I) as amended by Income-tax (6th Amendment) Rules, 2021

Relevant Form and Manner of Filing Not applicable as form has been already submitted

Who can sign and how to sign Not applicable as form has been already submitted

Document Required No additional documents required to be submitted unless called.

Time limit for making an application Not Applicable as the application has been already submitted.

Time limit for passing an order Within one month calculated from the end of the month in which the applicati

Validity of Registration The trust would get provisional registration which would be valid for the 3 yea
However, where the trust or institution has been provisionally registered unde
Consequences Not Applicable as the application has been already submitted.
3. Trust is not registered u/s 12AA as on 01/04/21 and willing to get registration

Description Remarks

Relevant Provision of the Act Section 12A(1)(ac)(vi)

Relevant Rule Rule 17A(1)(I) as amended by Income-tax (6th Amendment) Rules, 2021

Relevant Form and Manner of Filing ***same as discussed above in part 1***

Who can sign and how to sign ***same as discussed above in part 1***

Document Required ***same as discussed above in part 1***

Time limit for making an application The application can be furnished at least one month prior to the commencem

Time limit for passing an order Within one month calculated from the end of the month in which the applicati

Validity of Registration The trust would get provisional registration which would be valid for the 3 yea
Further, the provisional registration is not covered under the rigor of provision
However, where the trust or institution has been provisionally registered unde

Consequences Section 12A(1)(ac)(vi) is residuary provision and provides that in any other ca
4. Cancellation of Registration and Other Issues
4.1 The registration provided under clause (a) and (b) of section 12AB(1) are subject to section
12AB(4) and 12AB(5) i.e. the registration provided under those clauses can be cancelled by the
Commissioner if he is satisfied that the

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activities of such trust or institution are not genuine or

are not being carried out in accordance with the objects of the trust or institution or
the activities of the trust or the institution are being carried out in a manner that the provisions of
sections 11 and 12 do not apply to exclude either whole or any part of the income of such trust
or institution due to operation of sub-section (1) of section 13; or
the trust or institution has not complied with the requirement of any other law, as referred to in
item (B) of sub-clause (i) of clause (b) of sub-section (1), and the order, direction or decree, by
whatever name called, holding that such non-compliance has occurred, has either not been
disputed or has attained finality

4.2 However, the commissioner should afford a reasonable opportunity of being heard, before
cancelling the registration of the trust.

4.3 Further, it is advisable that the provisional registered trust should get regular registration before
accepting any substantial donation. Section 12A(1)(ac)(iii) provides that the provisional registered trust
should get regular registration within six months of commencement activity. However, if during such
buffer period, the trust accepts substantial donations and could not get registration due to any reason,
then such donation would attract the provisions of section 56(2)(x).

5. Conclusion

5.1 Undoubtedly, these new provisions have imposed additional compliance burden on the Charitable
and Religious Trusts. Further, these new compliances, as discussed above, are time bound
compliances which are required to be done within the given time frame.

5.2 Further, upon every renewal of registration / fresh registration, the legislature has provided the
discretionary power to the Commissioner to call for such documents or information from the trust or
institution or make such inquiries as he thinks necessary in order to satisfy himself about to check the
genuineness of activities of the trust or institution and the compliance of such requirements of any
other law for the time being in force by the trust or institution as are material for the purpose of
achieving its objects. So, this could be assumed as compulsory scrutiny of trust in every five years.

5.3 Therefore, in the upcoming time, we may see many litigations on these new provisions.