Chartiable Institution Specified Modes of Investment
This query is : Resolved
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CA Rishabh Kankaria
(Querist)
27 May 2021
If a charitable trust receives a corpus contribution for a specified purpose in the future. Let's assume to purchase a property after 5 years. Can that corpus be invested in:
1) Corporate Fixed Deposit of Bajaj Finance Ltd.
2) Equity Shares of ANY listed company.
or does one need to invest this money specifically in Specified modes of investment under section 11(5) too?
Kindly quote the act or rules before answering. The question is very relevant since today we know a lot of trusts investing in Corporate FDs of Bajaj Finance or Equity Shares of Listed Co.
1) Corporate Fixed Deposit of Bajaj Finance Ltd.
2) Equity Shares of ANY listed company.
or does one need to invest this money specifically in Specified modes of investment under section 11(5) too?
Kindly quote the act or rules before answering. The question is very relevant since today we know a lot of trusts investing in Corporate FDs of Bajaj Finance or Equity Shares of Listed Co.
CA R SEETHARAMAN
(Expert)
27 May 2021
No charitable trust can invest in Bajaj finance and in equity shares.
If you know such investments made the concerned auditors are responsible in reporting.
Specified modes of investment under section 11(5) only allowed.
If you know such investments made the concerned auditors are responsible in reporting.
Specified modes of investment under section 11(5) only allowed.
CA Rishabh Kankaria
(Querist)
27 May 2021
Seetharaman Sir,
Why will the Auditor falsely report the same but?
Because Section 11(5) does not allow trusts to invest in Bajaj Finance FD or Equity Shares of a Private Company.
Why will the Auditor falsely report the same but?
Because Section 11(5) does not allow trusts to invest in Bajaj Finance FD or Equity Shares of a Private Company.
CA R SEETHARAMAN
(Expert)
27 May 2021
Auditors report only non compliance.
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