Comparison of section 336 "Taxable Regular income." between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)

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....rwise. The change primarily clarifies the reference to application (section 341) and accumulation (section 342). Affected parties include registered non-profit organisations, tax authorities, and advisors. Effective date or assent date: Not stated in the document. Background & Scope Statutory hooks: Clause/Section 336 is located in the Income-tax Bill/Act, 2025 and is cast within the Part dealing with income of registered non-profit organisations. The provision addresses computation of "taxable regular income" for any tax year. The text invokes two related provisions: section 341 (application for charitable or religious purposes) and section 342 (accumulation for charitable or religious purposes). Definitions of "regular income", "registe....

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....;s earlier wording reads "applied or accumulated u/s 342" in one instance and in another instance omits reference to section 341; therefore the Bill version is ambiguous as to whether "application" must conform to section 341 or whether both application and accumulation were to be governed by section 342. Legislative intent (as discernible from the text): to exempt from tax that portion of regular income actually devoted to charitable/religious purposes (subject to the 85% threshold), and otherwise to require that 85% of regular income (less amounts applied/accumulated for charitable purposes) be treated as taxable regular income. Whether the statutory 85% operates as a minimum threshold for nil tax or as a base for computation when the th....

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....ation. Any rules, notifications, circulars, or further clarifications about what constitutes application u/s 341 or accumulation u/s 342: Not stated in the document. Interaction with other Parts of the Act beyond the stated sections (e.g., treatment of accumulated funds in later years, restrictions on application, or conditions for approval): Not stated in the document. Practical Implications * Compliance and risk areas: The enacted text reduces an ambiguity present in the Bill by expressly linking application to section 341 and accumulation to section 342. This reduces interpretive risk about which section governs "application" versus "accumulation". Assessing officers and taxpayers will rely on the separate regimes in sections 341 and ....

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....his drafting clarification reduces interpretive uncertainty between application and accumulation and focuses attention on compliance with sections 341 and 342. * Details about definitions, recordkeeping, timing rules, and procedural requirements u/ss 341/342 are not contained in the documents and remain necessary to implement the provision. Differences Between the Two Versions and Practical Impact Topic Clause 336 of the Income Tax Bill, 2025 Section 336 of the Income-tax Act, 2025 Reference to application vs accumulation Uses the phrase "applied or accumulated u/s 342" in one instance and omits an explicit reference to section 341; this conflates or omits the separate statutory bases for application and accumulation. Us....