» Business » I-T sops to trusts: Review mooted

I-T sops to trusts: Review mooted

By BS Economy Bureau in New Delhi
April 21, 2005 11:44 IST
Get Rediff News in your Inbox:

A parliamentary committee has recommended that the finance ministry consider incorporating a limitation provision for granting income-tax exemptions to a fund or an institution established for charitable purposes. The exemptions relate to assessment years starting 1986-87.

"The committee feel that grant of exemption to organisations after a gap of as long as 16 years does raise doubts about the rationale and bona-fides of such a step. Absence of a limitation provision is obviously a lacuna in the act or rules which should have suitably got amended by the department of revenue on its own initiative," the committee on subordinate legislation said in a report tabled in Parliament on Wednesday.

It noted that the attempt of the department to justify the lapse on the plea that the provisions have been kept in order to give exemption to genuine cases of charitable activities was hardly convincing as the ministry's explanation has not addressed the question of prolonged time lag. The committee was chaired by N N Krishnadas.

Suggested that a fund or an institution should be notified for exemption under Section 10 (23C) (iv) of the Income Tax Act well before the end of the relevant assessment year.

In case of a delay, the notification should be accompanied by an explanatory memorandum giving reasons for the delay in notification.

It also suggested that some time limit should be fixed for disposal of cases through departmental instruction.

"An analysis of reasons advanced by the department in this regard would show that it has been very slow in dealing with the application, seeking desired information from the applicants and taking a decision in the cases," the committee said.
Get Rediff News in your Inbox:
BS Economy Bureau in New Delhi
Source: PTI© Copyright 2022 PTI. All rights reserved. Republication or redistribution of PTI content, including by framing or similar means, is expressly prohibited without the prior written consent.

Moneywiz Live!