Income Tax

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CA Pankaj Shukla (Querist)
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19 December 2009 An NGO neither registered u/s 12A & 80G nor filed its ITR ever since its registration as a society,runs some schools under it.The schools are recognised from UP Board. Schools have been receiving the funds of varying from 2-5 lakhs Rs. time to time for its building construction from the development fund of varios MPs and MLAs.

Now if the trust seeks for its registration under section 12A and 80G and also wants to get its account audited for last three years then whether it will have to disclose the receipts of funds and also please tell that whether the receipts would be taxable then.
What you suggest please elucidate.

CA SURENDRA KUMAR RAKHECHA

CA SURENDRA KUMAR RAKHECHA (Expert)
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19 December 2009 Fortunately the answer is in your favour.

Since it is an educational institution existing solely for educational purposes and not for purposes profit, and which is wholly or substantially financed by the Government; hence its income is exempt u/s 23C(iiiab)

More particularly, it is an educational institution existing solely for educational purposes and not for purposes of profit, and having aggregate annual receipts which do not exceed Rs. 1 Crore (Rule 2BC).

Hence its income is exempt u/s 23C(iiiad).

Since the amount is exempt from tax hence you can get the accounts audited for the purpose of Registration u/s 12A & 80G without worry.

At the time of filing return of Income of previous two years; claim the total amount being exempt from tax under above section.

Ca Rakhecha,Surat

CA Pankaj Shukla

CA Pankaj Shukla (Querist)
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03 March 2010 Thanks sir..thank u very much for your advice...

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