Comparison of section 343 "Deemed accumulated income." between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)

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....he changes alter the reference points for reductions and slightly modify the obligation to invest. Affected parties are registered non-profit organisations and the tax department; no explicit effective date is stated in the documents. Background & Scope Statutory hooks: both texts are framed as Clause/Section 343 within the Income Tax Bill/Act, 2025, and they interact with sections 341, 342 and 350 as referenced. The subject matter is the taxation/administration of income of registered non-profit organisations - specifically a deemed accumulation rule. The documents provide no further definitions or explanatory notes beyond the clause text itself. Statutory Provision Mode Text & Scope * Both versions provide a two-paragraph provision.....

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...., it shall be invested or deposited in any of the modes permitted u/s 350." That change suggests a legislative choice to avoid imposing an absolute duty to invest the deemed amount - instead constraining the manner of investment if the amount is in fact invested or deposited. The enacted text also adds an express cross-reference to section 341 regarding "application of income," and inserts the phrase "set apart" when referencing income u/s 342; these additions refine the base from which the 15% is calculated. Exceptions/Provisos No separate provisos, exceptions, thresholds or timing conditions are included in either text beyond the 15% quantification and the exclusion in paragraph (2). No transitional, compliance, or penalty provisions ar....

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....r income before applying the 15% test. This narrows uncertainty about whether application u/s 341 reduces the base for deemed accumulated income; under the enacted text, it explicitly does. Practitioners will need to consult section 341 and section 342 to determine which amounts are deductible for computing the 15% base. * Record-keeping/evidence: Given the provision's focus on application/set-aside and investment/deposit, organisations should maintain contemporaneous records documenting (a) amounts applied pursuant to section 341, (b) amounts accumulated or set apart u/s 342, (c) the computation of the 15% deemed amount, and (d) evidence of any investment/deposit and the mode used (to show compliance with section 350 if an investment....

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....ct clarifies that application u/s 341 affects the base and expressly captures amounts "set apart" u/s 342, reducing ambiguity about what reduces regular income for the 15% calculation. Practitioners must therefore examine both sections 341 and 342 to compute the base accurately. * Obligation to invest/deposit: Bill - mandatory phrasing ("shall be invested or deposited in any of the modes permitted u/s 350"); Act - conditional phrasing ("where such deemed accumulated income is invested or deposited, it shall be invested or deposited in any of the modes permitted u/s 350"). * Practical impact: The Bill creates a clearer, potentially enforceable duty to invest the deemed amount in specified modes, increasing compliance exposure. The Act ap....