Accumulation of trust income: tax officers must monitor permitted accumulations and ensure actual utilisation for charitable purposes. Trusts must apply for permission to accumulate income and invest accumulated amounts in prescribed modes; if such income is diverted, not invested as required, or not actually applied for the permitted purpose during the accumulation period or in the year immediately following, it is deemed to arise in the year of noncompliance. Income tax Officers must maintain and cross reference a prescribed register recording allowed accumulations, make entries for each assessment year to monitor compliance with accumulation and utilisation requirements, and inspect and verify that accumulated income is genuinely utilised for permitted purposes.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Accumulation of trust income: tax officers must monitor permitted accumulations and ensure actual utilisation for charitable purposes.
Trusts must apply for permission to accumulate income and invest accumulated amounts in prescribed modes; if such income is diverted, not invested as required, or not actually applied for the permitted purpose during the accumulation period or in the year immediately following, it is deemed to arise in the year of noncompliance. Income tax Officers must maintain and cross reference a prescribed register recording allowed accumulations, make entries for each assessment year to monitor compliance with accumulation and utilisation requirements, and inspect and verify that accumulated income is genuinely utilised for permitted purposes.
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