Notification No. 73/2020 [F. No. 300196/36/2017-ITA-I] / SO 3088(E)

Last updated: 12 September 2020

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This notification from the Ministry of Finance grants tax exemption to District Mineral Foundation Trusts (DMF Trusts). It specifies various types of income, including contributions from leaseholders, late payment interest, penalties, and interest on funds, that are eligible for this exemption. The notification is effective from assessment years 2018-2019 onwards, subject to certain conditions.

MINISTRY OF FINANCE

(Department of Revenue)

(CENTRAL BOARD OF DIRECT TAXES)

NOTIFICATION

New Delhi, the 10th September, 2020

S.O. 3088(E).—In exercise of the powers conferred by clause (46) of section 10 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies for the purposes of the said clause, ‘District Mineral Foundation Trust’ as specified in the schedule to this notification, constituted by Government in exercise of powers conferred under section 9(B) of the Mines and Minerals (Development and Regulation) Amendment Act, 2015 (10 of 2015) as a ‘class of Authority’, in respect of the following specified income arising to that Authority, namely :-

(a) Contribution by lease Holder to DMF as per the Mines and Minerals (Contribution to District Mineral Foundation) Rules, 2015;

(b) Interest received from lease holders for late payment;

(d) Income from Interest on fund available under DMF;

(e) Interest received on Saving Bank Accounts; and

(f) Interest received on Excess Fund invested in Term Deposit.

2. This notification shall be effective subject to the conditions that each of the District Mineral Foundation Trust-

(a) shall not engage in any commercial activity;

(b) activities and the nature of the specified income shall remain unchanged throughout the financial years; and

(c) shall file return of income in accordance with the provision of clause (g) of sub-section (4C) of section 139 of the Income-tax Act, 1961.

(d) shall file the Audit report along with the Return, duly verified by the accountant as provided in explanation to section 288(2) of the Income-tax Act, 1961 along with a certificate from the chartered accountant that the above conditions are satisfied.

3. This notification shall be deemed to have been applied for the assessment year 2018-2019 and 2019-2020 and shall apply with respect to the assessment years 2020-2021, 2021-2022 and 2022-2023 in respect of Trusts mentioned in column (2) of the below mentioned schedule.

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FAQ :

The Central Government is notifying 'District Mineral Foundation Trust' as a 'class of Authority' for the purposes of clause (46) of section 10 of the Income-tax Act, 1961, granting it certain tax exemptions.

The specified income includes contributions by leaseholders, interest received for late payments, penalties charged to leaseholders, interest on DMF funds, interest on savings bank accounts, and interest on excess funds invested in term deposits.

DMF Trusts must not engage in commercial activity, their activities and income nature must remain unchanged, and they must file their income tax return and an audit report with a chartered accountant's certificate confirming compliance.

This notification is deemed to have been applied for assessment years 2018-2019 and 2019-2020, and will apply for assessment years 2020-2021, 2021-2022, and 2022-2023.