ITR 7 Filing requirement

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ABDUL SALAM (Querist)
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22 December 2021 Dear Sir,
Please correct my understanding....

ITR 7 would be filed by the assessee only if they have exempted income...

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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22 December 2021 Eligibility Criteria for ITR-7:
The following individuals and associations are eligible to file the ITR-7 form:
All individuals who obtain income from property if said property is in the name of a trust
All individuals who receive income for the sole purpose of charity or a religious offering
Any political party that earns a net income that is more than the ceiling limit that is exempt from income tax
Associations that carry out scientific research
News organizations and companies
Organizations as mentioned in Section 10(23A) and Section 10(23B)
Educational institutions such as school, colleges or universities
Medical institutions such as hospitals, clinics etc

These individuals/organizations have to file the form ITR7 for claiming the exemptions. Above the exemption criteria/limit tax is payable by these assesses also.

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ABDUL SALAM

ABDUL SALAM (Querist)
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22 December 2021 So fast....thank you Sir....

We have few trusts whose income is completely 100% exempted u/s.10(23da)...

Query 1 - If we have exempted income under above section, we need to file ITR 7. Right Sir ?
Query 2 - If there is a 'deficit' in the trust, and the purpose of the trust creation has not been
completed, Then Sir ?
Thank you Sir.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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22 December 2021 1. Correct.
2. Tax liability will arise if the funds are not utilized as specified under the act.

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ABDUL SALAM

ABDUL SALAM (Querist)
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22 December 2021 Thanks a lot Sir....trying to frame one more question....

ABDUL SALAM

ABDUL SALAM (Querist)
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23 December 2021 Good Morning Sir,

Could you please educate me on the following wording derived from the instructions of ITR-5.

"Trust other than trusts eligible to file Form ITR-7 is eligible to use Form ITR-5"

My understanding:
a) If there is an exempted (ex. u/s.10(23da) income, we need to file Form ITR-7.
b) If there is no income, we need to file Form ITR-5.

Request you to help me in this regard.

Thanks a lot in advance.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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23 December 2021 Be there be income or not, being "securitisation trust" as defined in clause (u) of sub-regulation (1) of regulation 2 of the Securities and Exchange Board of India (Public Offer and Listing of Securitised Debt Instruments) Regulations, 2008 made under the Securities and Exchange Board of India Act, 1992 (15 of 1992) and the Securities Contracts (Regulation) Act, 1956 (42 of 1956), and regulated under the said regulations; you need to file ITR 7.

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ABDUL SALAM

ABDUL SALAM (Querist)
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23 December 2021 Thanks a lot for the support Sir....

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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23 December 2021 Most Welcome ...

ABDUL SALAM

ABDUL SALAM (Querist)
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24 December 2021 Dear Sir,

Scenario:
We have 'Excess of expenditure over income' in IE a/c. of our "securitisation trust". Whereas the Investment (SRs) in the trust can be redeemed in next 5 years.

Query:
How do we report the 'deficit' and in which schedule(s) of ITR-7.

Please guide me Sir.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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24 December 2021 Here the reporting in ITR should coincide with the statutory audit report. Either it would be reported as business loss or should not be claimed at all depends upon the condition mentioned therein.

ABDUL SALAM

ABDUL SALAM (Querist)
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24 December 2021 Okay Sir...
Till AY 2020-21, we have been filing 'zero' return through ITR-7 without reporting the 'deficit' ie. business loss (since the entire income is exempted u/s.10(23DA)).
After realisation of complete investment, expenses (includes previous years), we were declaring the income and distributing the same to the investors u/s.115TCA.

Query:
For the AY 2021-22, the ITR-7 is holding us to file and saying that 'the cell exemption U/s.10(23DA) and schedule IE-1 should be numeric'.

Need your suggestion Sir.

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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24 December 2021 Technically, I think, it should be left blank, or no need to file any field in schedule PGBP.
Still I would request you to take help of local CA, to solve the problem.

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ABDUL SALAM

ABDUL SALAM (Querist)
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24 December 2021 Thanks a lot for the help and time Sir....Learnt a lot...

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