Yes, if it is taxed at MMR (maximum marginal rate) 

Thanks Mr Dhirajlal Rambhia. As I had written earier, the income of the Association is below Rs.2,50,000. Hence the Association is not subject to any Income Tax at all. I hope the concept of MMR is not applicable here. Hence the Association need not file any ITR. Right?

Just check, MMR is applicable for AOP under two conditions......

The case I am discussing is regarding a flat owners association. The Association collects maintenance charges and provide various common services to the owners. A small portion of the funds generates some interest income, which is far below the minimum taxable limit of Rs.2,50,000. There is no other taxable income. 

The appliability of MMR will come into picture under two categories of (1) Where share of members are known and (2) Where share of members are not known ONLY WHEN THE ASSOCIATION IS HAVING SOME TAXABLE INCOME ABOVE THE EXEMPTED LIMIT. I feel that there cannot be any ALTERNATE MINIMUM TAX also here. 

Applicability of MMR will come only when the Association earns something and distributing the same to members and when the income of the Association is above exempted limit of Rs. 250000. 

If no tax is payable, then there is no need to file ITR also. 

I request you enlighten me further on this. 

Thanks/Regards.

S Kalyanasundaram

Refer:: https://www.caclubindia.com/experts/association-of-persons-94616.asp

Thank you very much for your reply.

The link sent by you discusses ‘unregistered Association of Person’. The case I am discussing is a Registered flat owners Association.

The write up provides

“An association of persons (AOP) under the Income Tax Act is an entity or unit of assessment. It means two or more persons who join for a common purpose with a view to earn an income.
 

Body of individuals (BOI) means a conglomeration of individuals who carry on some activity with the objective of earning some income.”

The case I am discussing is flat owners association and it is not formed to earn income. It has been formed to provide service to members. Incidentally it earns some interest income which is below Rs.2,50,000

Please refer to

https://www.incometaxindia.gov.in/Pages/i-am/aop.aspx?k=Return%20Filing

RETURN FILING​​

​Is it mandatory to file return of income?

Every AOP/BOI whether incorporated or not has to file the return of income if his total income (including income of any other person in respect of which he is assessable) without giving effect to the provisions of section 10(38), 10A, 10B or 10BA or Chapter VIA (i.e., deduction under section 80C to 80U), exceeds the maximum amount which is not chargeable to tax i.e. exceeds the exemption limit.

An association of persons (AOP) or a body of individuals (BOI), whether incorporated or not, is treated as a ‘person’ under section 2(31)​ of the Income-tax Act, 1961.

When AOP is treated as a person and when the income tax payable for an individual arises only when it is more than Rs.2,50,000 no tax is payable when the AOP’s income is below Rs.2,50,000. Right?

If no tax is payable, then there is no mandatory filing of ITR. Right?

With regards.

S Kalyanasundaram