Tax on accreted income imposed on trusts upon conversion, merger or failure to transfer assets, with strict recovery. Trusts and institutions registered under section 12AA that convert to non-eligible forms, merge with non-qualifying entities, or fail to transfer assets on dissolution within the prescribed period are subject to tax on accreted income, defined as the excess of aggregate fair market value of assets over liabilities on the specified date with prescribed valuation and limited exclusions. The tax is charged at the maximum marginal rate, payable by the trust and its principal officer within specified trigger dates, treated as final, disallows further deductions or credits, accrues interest if unpaid, and non-payment attracts recovery provisions including transferee liability limited to asset value.
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Provisions expressly mentioned in the judgment/order text.
Tax on accreted income imposed on trusts upon conversion, merger or failure to transfer assets, with strict recovery.
Trusts and institutions registered under section 12AA that convert to non-eligible forms, merge with non-qualifying entities, or fail to transfer assets on dissolution within the prescribed period are subject to tax on accreted income, defined as the excess of aggregate fair market value of assets over liabilities on the specified date with prescribed valuation and limited exclusions. The tax is charged at the maximum marginal rate, payable by the trust and its principal officer within specified trigger dates, treated as final, disallows further deductions or credits, accrues interest if unpaid, and non-payment attracts recovery provisions including transferee liability limited to asset value.
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