Investment in shares of pvt ltd co. by public charitable tru
This query is : Resolved
Sowmya.S.Balan
(Querist)
16 February 2013
Dear Sir,
The main object of our trust to make the people aware of the love and care of god through television . We have 12A registration also. Because of insufficiency of funds we are not able to start a channel for this purpose. So we would like to invest in shares of a channel which is a private limited company (Rs. 800000) to broadcast our programs at a reduce rate. In our trust deed there is no mention about such investment. This is actually our application of income for fulfilling our objectives & not for earning income on investment . But as per section 13(1)(d) investment in shares other than shares in public limited company and other than as per 11(5) is held by the trust , section 11 & 12 does not applicable. we would like to show this amount in balance sheet as investment and show this amount as application of income in computation and claim exemption u/s 11 .Is there any problem in that? Whether that amount of 800000/- become taxable or not ? whether it affects our 12a registration ? please advice me . its very urgent. If any caselaws or circulars favoring such a situation please quote that also
favoring such a situation please quote that also
The main object of our trust to make the people aware of the love and care of god through television . We have 12A registration also. Because of insufficiency of funds we are not able to start a channel for this purpose. So we would like to invest in shares of a channel which is a private limited company (Rs. 800000) to broadcast our programs at a reduce rate. In our trust deed there is no mention about such investment. This is actually our application of income for fulfilling our objectives & not for earning income on investment . But as per section 13(1)(d) investment in shares other than shares in public limited company and other than as per 11(5) is held by the trust , section 11 & 12 does not applicable. we would like to show this amount in balance sheet as investment and show this amount as application of income in computation and claim exemption u/s 11 .Is there any problem in that? Whether that amount of 800000/- become taxable or not ? whether it affects our 12a registration ? please advice me . its very urgent. If any caselaws or circulars favoring such a situation please quote that also
favoring such a situation please quote that also
18 February 2013
Then amount can not be treated as application of income nor be treated as investment as it is not permitted investment
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