15 June 2015
Our trust is registered in income tax dept.under sec.12AA. Our trust give donation for construct of temple, masjid,church,etc. & also give hospitalization exp. to needy,poor people, give food to poor people & other philanthropic activities under no any type of monetary or non monetary consideration. In this regard following are my questions 1) Is above activities are said to be service & is our trust is liable for payment of service tax.You are requested to give your legal opinion
15 June 2015
These are charitable activities not liable for service tax as per notification given below. Clause No. 4 of Notification No. 25/2012 provides as follow: Services by an entity registered under section 12AA of the Income tax Act, 1961(43 of 1961) by way of charitable activities; As can be seen from above, exemption granted has two important conditions to be complied with viz. (i) CT should have been registered under section 12AA of Income Tax Act and (ii) the activities carried on should be charitable activities. Thus, all the activities carried on by the CT per se are not exempt. Exemption granted is restrictive. What are “charitable activities”? Clause 2(k) of Notification No. 25 / 2012 defines it as follow: (k) “charitable activities” means activities relating to – (i) public health by way of – (a) care or counseling of (i) terminally ill persons or persons with severe physical or mental disability, (ii) persons afflicted with HIV or AIDS, or (iii) persons addicted to a dependence-forming substance such as narcotics drugs or alcohol; or (b) public awareness of preventive health, family planning or prevention of HIV infection; (ii) advancement of religion or spirituality; (iii) advancement of educational programmes or skill development relating to,- (a) abandoned, orphaned or homeless children; (b) physically or mentally abused and traumatized persons; (c) prisoners; or (d) persons over the age of 65 years residing in a rural area; (iv) preservation of environment including watershed, forests and wildlife; or (v) advancement of any other object of general public utility up to a value of,- (a) eighteen lakh and seventy five thousand rupees for the year 2012-13 subject to the condition that total value of such activities had not exceeded twenty five lakhs rupees during 2011-12; (b) twenty five lakh rupees in any other financial year subject to the condition that total value of such activities had not exceeded twenty five lakhs rupees during the preceding financial year.
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