Union Budget 2025-26 (Full) + Finance Bill, 2025

IV. Rationalisation of persons specified under sub-section (3) of section 13 for trusts or institutions

Section 13 of the Act, inter alia, provides that section 11 or section 12 shall not apply to exclude any income from the total income of trust of institution, if such income enures, or such income or any property of the trust or the institution is used or applied, directly or indirectly for the benefit of any person referred to in sub-section (3), which inter alia are as following –

Ÿany person who has made a substantial contribution to the trust or institution, that is to say, any person whose total contribution up to the end of the relevant previous year exceeds fifty thousand rupees;

Ÿany relative of any such person as aforesaid;

Ÿany concern in which any such person as aforesaid has a substantial interest.

2. Suggestions have been received that there are difficulties in furnishing certain details of persons other than author, founder, trustees or manager etc. who have made a ‘substantial contribution to the trust or institution’, that is to say, any person whose total contribution up to the end of the relevant previous year exceeds fifty thousand rupees. These details are about their relatives and the concerns, in which they are substantially interested.

3. It is, therefore, proposed to amend the sub-section (3) of section 13 to provide that,–

(i) persons referred to in clause (b) of sub-section (3) of section 13, shall be any person whose total contribution to the trust or institution, during the relevant previous year exceeds one lakh rupees, or, in aggregate up to the end of the relevant previous year exceeds ten lakh rupees, as the case may be;

(ii) relative of any such person as mentioned in (i) above, shall not be included in persons specified in sub-section (3) of section 13; and

(iii)any concern in which any such person as mentioned in (i) above has a substantial interest, shall not be included in persons specified in sub-section (3) of section 13.

4. These amendments will take effect from the 1st day of April, 2025.

[Clause 8]

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Union Budget 2025-26 (Full) + Finance Bill, 2025