TaxTMI 
TaxTMI 
Comparison of section 354 "Application for approval for purpose of section 133(1)(b)(ii)." between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)
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.... tax authorities because approval enables donor deduction treatment under the linked provision. The Bill sets eligibility conditions, timelines for application and orders, procedural safeguards and validity periods for approvals. Effective date or commencement is Not stated in the document. Background & Scope Statutory hook: Clause 354 is drafted for the purpose of obtaining approval for application of section 133(1)(b)(ii) (as referenced in the heading). The provision governs who may apply (a registered non-profit organisation or a person referred to in Schedule III (Table: Sl. No. 1)), the conditions for eligibility, procedural stages for the Principal Commissioner or Commissioner, timelines for applications and orders, and the period o....
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....rm and verified manner, within prescribed time, to the prescribed income-tax authority or an authorised person; * (f) it delivers correction statements for rectification or updating of the statement required under (e), in prescribed form and verified manner; * (g) it furnishes a certificate to the donor specifying the donation amount within a prescribed period from date of receipt, containing requisite particulars in the prescribed manner. Timelines and validity: Sub-section (2) contains a five-row Table specifying application time limits, time for the Principal Commissioner or Commissioner to pass orders, and the validity period of approval, distinguishing cases where activities have commenced, where activities have not commenced, pro....
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....t which has not commenced activities applies during the tax year from which it seeks approval; the authority must pass an order within "One months from the end of the month in which application is made" and, if provisional approval is granted, the approval is valid for "Three tax years commencing from the tax year in which such application is made." (This example follows the Table text.) * Example 2: A registered non-profit whose activities have commenced applies at any time during the tax year from which approval is sought; the authority has six months from the end of the quarter in which application is made to pass an order; if approved the validity is five tax years commencing from that tax year. (Derived directly from the Table.) * ....
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....se practical effect depends on the contents of the respective Schedules; those listed in Schedule III will differ from those in Schedule VII, so an entity's eligibility to apply may be expanded or narrowed depending on which Schedule applies. The document does not state the contents of either Schedule. * Religious-expenditure threshold wording: Document 1 states the applicant "does not incur any expenditure of an amount exceeding 5% of its total income during a tax year which is of a religious nature." Document 2 states the applicant "does not incur any expenditure of an amount being 5% or more of its total income during a tax year which is of a religious nature." * Practical impact: The two phrasings create different inclusive/excl....
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....ear stylistic and do not, by themselves in the provided text, change substantive rights or obligations. The document does not state any consequential administrative guidance. Practical Implications * Eligibility screening: Applicants must ensure they satisfy the seven listed conditions. In particular, the religious-expenditure metric ("5% or more") is a hard threshold in the text and can render otherwise qualifying organisations ineligible if religious spending equals or exceeds that proportion. Organisations should carefully compute and document the nature of expenditures to demonstrate compliance with clause (b). The document does not provide a methodology for such calculation. * Record-keeping and reporting: Clauses (d), (e) and (f)....