RENEWAL REGISTRATION APPLICATION UNDER SEC 12A & 80G

[VEMULA CHANDRASEKHAR]

What is the meaning of the term 'Commencement of Activities' under Sec.12A(ac)(iii)? What can be a checkpoint for identifying the 'Commencing the activities' event for making a renewal application under Sec 12AB?

[YAGAY andSUN]

Under Section 12A(ac)(iii) of the Income Tax Act, the term "Commencement of Activities" refers to the actual beginning of the charitable or religious operations for which the trust or institution was established. This is a critical trigger for making an application for registration/renewal under Section 12AB, particularly for newly formed entities that have been granted provisional registration.

✅ Checkpoints to Identify "Commencement of Activities":

Some practical indicators that may be considered as the starting point of activities include:

1. First expenditure towards a charitable or religious object (excluding administrative setup costs).
2. Organizing the first charitable event, camp, workshop, or service delivery activity.
3. Issuing a donation receipt, where funds are utilized for a specific charitable cause.
4. Launching a program, school, clinic, community initiative, etc.
5. Entering into contracts for delivering charitable services (e.g., with a hospital, school, or NGO partner).
6. Deployment of staff or volunteers to carry out the trust's objectives.

📝 Application Timeline:

The trust/institution must file for regular registration under Section 12AB within 6 months from the end of the month in which it commences activities or at least 6 months before the expiry of the provisional registration, whichever is earlier.

Proper documentation like event reports, bills, agreements, or bank transactions related to the first activity should be maintained as evidence of commencement for the renewal process.

AI Summary

Commencement of Activities: triggers requirement to apply for renewal under Section twelveAB within prescribed timeline. Commencement of Activities denotes the tangible start of charitable or religious operations that triggers the obligation to apply for regular registration under Section 12AB. Practical indicators include first charitable expenditure (excluding administrative setup), inaugural events or service delivery, issuance of donation receipts for charitable use, program launches, contracts to deliver charitable services, and deployment of staff or volunteers. The applicant must file within the statutory timeline linked to commencement or provisional registration expiry, and must retain contemporaneous evidence-event reports, bills, agreements, and bank transactions-to substantiate the commencement date for renewal.