CBDT notifies New IT Rules and Forms for Trust and NGOs

CBDT vide Notification No. 19/2021 dated 26.03.2021 has notified the new registration procedure for NGOs and Charitable Trusts and other institutions under section 12AB and section 10(23C) of the Income Tax Act, 1961 through Income-tax (6th Amendment) Rules, 2021. It has also notified the procedure for furnishing the statement of donation received by NGO/Trust under section 80G(5).

The new registration procedure prescribed under section 12AB for Charitable Trusts and Institutions introduced by the Finance Act, 2020 was deferred and extended to 1^st April, 2021 by the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020. 

Renewal of registration u/s 12A or section 12AA, as well as renewal of approval under section 80G, was deferred to 1^st April, 2021.

The salient points of the Notification No. 19/2021 dated 26.03.2021 are described below:

• Substitution of Rule 2C : Application for the purpose of grant of approval of a fund or trust or institution or university or any hospital or other medical institution under clause (i) or clause (ii) or clause (iii) or clause (iv) of first proviso to clause (23C) of Section 10 would be made under substituted Rule 2C of Income-tax Rules, 1962 as amended by the Income-tax (6th Amendment) Rules, 2021. Form No. 10A  needs to filed in case of application under clause (i) or clause (iv) of first proviso to clause (23C) of section 10 or Form No. 10AB in case of application under clause (ii) or clause (iii) of first proviso to clause (23C) of section 10 to the Principal Commissioner or Commissioner.

• Allotment of Unique Registration Number (URN) : On receipt of an application in Form No. 10A, the Principal Commissioner or Commissioner shall pass an order in writing granting approval under section 10(23C) in Form No. 10AC and issue a sixteen-digit alphanumeric Unique Registration Number (URN) to the applicants making application.

• Provisional Approval in case of a new Institution: In case of an application made under clause (iv) of first proviso to clause (23C) of section 10 during previous year beginning on 1st day of April, 2021, the provisional approval shall be effective from the assessment year beginning on 1st day of April, 2022.

• Approval under Form 10AD: Where an application is made in Form 10AB, the order of approval or rejection or cancellation under clause (23C) of section 10 shall be in form 10AD and in case if the approval is granted, sixteen digit alphanumeric number Unique Registration Number (URN) shall be issued, by the Principal Commissioner or Commissioner.

• New Rule 5CA: New Rule 5CA inserted for filing of application for intimation under 5th proviso to sub-section (1) of section 35. The Application shall be made in Form No.10A to the Principal Commissioner of Commissioner.

• Documents to furnished along with Form 10A : (a) where the applicant is created or established under an instrument, self-certified copy of the instrument;

(b) where the applicant created or established otherwise than under an instrument, self-certified copy of the document evidencing the creation or establishment of the applicant;

(c) self-certified copy of registration with Registrar of Companies or Registrar of Firms and Societies or Registrar of Public Trusts or other registration document, as the case may be;

(d) self-certified copy of registration under Foreign Contribution (Regulation) Act, 2010, if the applicant is registered under such Act;

(e) self-certified copy of existing Notification granting approval under section 35.

• Substitution of rule 11AA: An application of approval under clause (i) or clause (iv) of the first proviso to section 80G(5) for the grant of approval of a fund or institution shall be made in Form 10A. Where application is made under clause (i) or clause (iv) of the first proviso to section 80G(5), the application shall be made in Form 10AB to the Principal Commissioner or Commissioner.

• Documents to furnished along with Form 10A or 10AB: 1. For an entity, created or established under an instrument, self-certified copy of such instrument creating or establishing the entity.

2. For an entity, created or established otherwise than under an instrument, self-certified copy of such of the document evidencing creation or establishment of the entity.

3. Self-certified copy of registration with Registrar of Companies or Registrar of Firms and Societies or Registrar of Public Trusts, as the case may be.

4. Self-certified copy of registration under Foreign Contribution (Regulation) Act, 2010, if the applicant is registered under such Act;

5. Self-certified copy of existing order granting approval under clause (23C) of section 10;

6. Self-certified copy of order of rejection of application for grant of approval under clause (23C) of section 10, if any;

7. For existing entities, self-certified copies of the annual accounts of three years immediately preceding the year in which the said application is made;

8. Where an undertaken is by the entity as per the provisions of sub-section (4) of section 11 and/ or where income of the entity includes profits and gains of business as per the provisions of sub-section (4A) of section 11, self-certified copies of the annual accounts and report of audit as per the provisions of section 44AB of three years immediately preceding the year in which the said application is made;

9. Note on the activities of the applicant.

• Insertion of Rule 18AB: Statement of particulars required to be furnished by any research association, university, college or other institution or company or fund (“reporting person”) under clause (viii) of sub-section (5) of section 80G or under clause (i) to sub-section (1A) of section 35 shall be furnished in respect of each financial year, beginning with the financial year 2021-2022, in Form No. 10BD and shall be verified in the manner indicated therein.

• Furnishing of certificate in Form 10BE: The reporting person shall furnish the certificate as referred to in clause (ix) of sub-section (5) of section 80G or in clause (ii) to sub-section (1A) to section 35, to the donor in Form No. 10 BE specifying the amount of donation received during financial year from such donor, beginning with the financial year 2021-2022.

All applications made under the existing rules and is pending before the Principal Commissioner or Commissioner, on which no order has been passed before the 1st day of April, 2021, shall be deemed to be an applications made under clause (iv).

New Form 10A is available for e-Filing for registration or provisional registration or intimation or approval or provisional approval. 

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