Loading...

⚠ ✕
❮ Top
☎ Help
☰
×

By creating an account you can:

Logo TaxTMI
Call Us / Help / Feedback✕

Contact Us At :

✉ E-mail: [email protected]

✆ Call / WhatsApp at: +91 99117 96707

For more information, Check Contact Us

FAQs :

To know Frequently Asked Questions, Check FAQs

Most Asked Video Tutorials :

For more tutorials, Check Video Tutorials

Submit Feedback/Suggestion :

Email :
Please provide your email address so we can follow up on your feedback.
Category :
Description :
Min 15 characters 0/2000
Make Most of Text Search ✕
  1. Checkout this video tutorial: How to search effectively on TaxTMI.
  2. Put words in double quotes for exact word search, eg: "income tax"
  3. Avoid noise words such as : 'and, of, the, a'
  4. Sort by Relevance to get the most relevant document.
  5. Press Enter to add multiple terms/multiple phrases, and then click on Search to Search.
  6. Text Search
  7. The system will try to fetch results that contains ALL your words.
  8. Once you add keywords, you'll see a new 'Search In' filter that makes your results even more precise.
  9. Text Search
╳
Add to...
You have not created any category. Kindly create one to bookmark this item!
✕
Create New Category
Hide
Title :
Description :
❮❮ Hide
❮ Default View
Expand ❯❯
Close ✕
🔎 Filters / Advanced Search ❯
TEXT

Press 'Enter' to add multiple search terms. Rules for Better Search

Search In
Main Text + AI Text ❯
  • Main Text
  • Main Text + AI Text
  • AI Text
Law:
---- All Laws---- ❯
  • ---- All Laws----
  • Benami Property
  • Bill
  • Central Excise
  • Companies Law
  • Customs
  • DGFT
  • FEMA
  • GST
  • GST - States
  • IBC
  • Income Tax
  • Indian Laws
  • Money Laundering
  • SEBI
  • SEZ
  • Service Tax
  • VAT / Sales Tax
Types:
---- All Types ---- ❯
  • ---- All Types ----
  • Act Rules
  • Case Laws
  • Circulars
  • Manuals
  • News
  • Notifications
Sort By: ?
In Sort By 'Default', exact matches for text search are shown at the top, followed by the remaining results in their regular order.
Relevance Default Date
    Act Rules Income Tax
    Comparison of Section 90 "Meaning of "adjusted", "cost of improvement" and "cost of acquisition." be...
    Act Rules Income Tax
    Comparison of Section 88 "Exemption of capital gains on transfer of assets in cases of shifting of i...
    Act Rules Income Tax
    Comparison of Section 87 "Exemption of capital gains on transfer of assets in cases of shifting of i...
    Act Rules Income Tax
    Comparison of Section 86 "Capital gains on transfer of certain capital assets not to be charged in c...
    Act Rules Income Tax
    Comparison of Section 85 "Capital gains not to be charged on investment in certain bonds." between t...
    Act Rules Income Tax
    Comparison of Section 84 "Capital gains on compulsory acquisition of lands and buildings not to be c...
    Act Rules Income Tax
    Comparison of Section 78 "Special provision for full value of consideration in certain cases." betwe...
    Act Rules Income Tax
    Comparison of Section 74 "Special provision for computation of capital gains in case of depreciable ...
    Act Rules Income Tax
    Comparison of Section 73 "Cost with reference to certain modes of acquisition" between the Income-Ta...
    Act Rules Income Tax
    Comparison of Section 72 "Mode of computation of capital gains" between the Income-Tax Act, 2025 (as...
    Act Rules Income Tax
    Comparison of Section 70 "Transactions not regarded as transfer" between the Income-Tax Act, 2025 (a...
    Act Rules Income Tax
    Comparison of Section 66 "Interpretation" between the Income-Tax Act, 2025 (as passed) and the Incom...
    Act Rules Income Tax
    Comparison of Section 62 "Maintenance of books of account" between the Income-Tax Act, 2025 (as pass...
    Act Rules Income Tax
    Comparison of Section 61 "Special provision for computation of income on presumptive basis in respec...
    Act Rules Income Tax
    Comparison of Section 58 "Special provision for computing profits and gains of business or professio...
    Act Rules Income Tax
    Comparison of Section 53 "Full value of consideration for transfer of assets other than capital asse...
    Act Rules Income Tax
    Comparison of Section 52 "Amortisation of expenditure for telecommunications services, amalgamation,...
    Act Rules Income Tax
    Comparison of Section 51 "Amortisation of expenditure for prospecting certain minerals" between the ...
    Act Rules Income Tax
    Comparison of Section 49 "Site Restoration Fund" between the Income-Tax Act, 2025 (as passed) and th...
    Act Rules Income Tax
    Comparison of Section 48 "Tea development account, coffee development account and rubber development...
❮
❯
❯❯
Maximize Maximize Maximize
0 / 200
Expand Note
Add to Folder

No Folders have been created

+

Are you sure you want to delete "My most important" ?

NOTE:

Notes
Showing Results for :
Reset Filters
Results Found:
Show All Summaries Hide All Summaries
Act Rules Income Tax
Show AI Summary
Cost of acquisition rules clarify valuation and allocation for capital gains, with special treatment for intangibles and pre-existing equity holdings.
The provision defines cost of improvement and cost of acquisition for capital gains, treating improvements to specified intangibles as nil, excluding deductible expenditures, and reducing acquisition cost by prior depreciation on goodwill. It prescribes allocation rules for acquisitions by purchase, allotment, bonus, subscription and renunciation, and provides alternative valuation anchors-including an option to adopt a historic fair market value, exchange quotes, net asset value and the Cost Inflation Index-for certain pre-existing and unlisted equity holdings.
Act Rules Income Tax
Show AI Summary
Exemption of capital gains for relocation to SEZs: reinvestment within prescribed window defers taxation, subject to deposit and scheme compliance
Exemption applies to capital gains from transfer of assets when shifting an industrial undertaking from an urban area to a Special Economic Zone, functioning as a reinvestment relief if gains are applied to acquire or construct specified new assets in the SEZ within one year before to three years after transfer. Unutilised amounts must be deposited with a specified institution by the return filing due date and later utilised under a notified scheme; any portion unutilised after three years is charged as income. Cost basis of the new asset is adjusted for subsequent transfers within three years.
Act Rules Income Tax
Show AI Summary
Capital gains exemption on industrial relocation: reinvestment in new assets prevents taxation, subject to deposit and proof rules.
A reinvestment linked exemption for capital gains applies where assets used in an industrial undertaking situated in a urban area are transferred as part of shifting the undertaking outside urban limits. The assessee must, within one year before or three years after transfer, acquire specified new assets or incur notified scheme expenses; reinvestment equal to or exceeding the gain prevents charging of the gain, shortfalls are charged as income, and unutilised proceeds must be deposited under a notified scheme with proof filed by the return due date.
Act Rules Income Tax
Show AI Summary
Capital gains relief for reinvestment into residential property requires timely deposit and triggers recapture if proceeds remain unutilised.
Provision grants a proportionate exemption from long term capital gains where individuals/HUFs reinvest proceeds from sale of a non residential long term asset into one residential house in India, subject to purchase/construction time windows. Unutilised proceeds must be deposited under a notified scheme by the return filing due date with proof; recapture applies if deposits are not used within three years. The enacted text ties deposit triggers to net consideration, shortens the disqualification window for subsequent purchases, and imposes monetary caps and heightened compliance obligations.
Act Rules Income Tax
Show AI Summary
Roll over relief for capital gains: reinvestment in specified long term bonds defers tax subject to time, holding and cap conditions.
Relief defers tax on long term capital gains from transfer of land or building when reinvested within six months into notified long term bonds, with a statutory investment ceiling and a five year holding requirement; breach by transfer, conversion to money, or borrowing on the bond triggers deeming of previously exempted amounts as taxable long term capital gains and disallows a specified deduction for amounts claimed under the relief.
Act Rules Income Tax
Show AI Summary
Capital gains deferral for compulsory acquisition where reinvestment in industrial undertaking preserves tax neutrality subject to deposit and timelines.
Section 84 conditions tax neutrality for capital gains on compulsory acquisition of industrial land/buildings where the assessee reinvests proceeds in a replacement asset within the prescribed reinvestment period; excess proceeds over new-asset cost are charged as income and certain cost-basis adjustments apply for disposals within the reinvestment period. Unutilised proceeds must be deposited in a specified institution and applied per a notified scheme by the return-filing due date, with documentary proof required and residual unutilised amounts charged as income.
Act Rules Income Tax
Show AI Summary
Deemed consideration rule: stamp duty value treated as full consideration for capital gains when declared consideration is lower.
The provision deems the stamp duty value of land or building to be the full value of consideration for section 72 where declared consideration is lower, subject to a date of agreement exception conditioned on prescribed electronic/banking payment modes and a 110% safe harbour allowing actual consideration to prevail when stamp duty value does not exceed 110% of consideration; Assessing Officers may refer valuation claims to a Valuation Officer where the assessee asserts stamp duty value exceeds fair market value and the stamp duty value has not been contested.
Act Rules Income Tax
Show AI Summary
Deeming of short-term capital gains where transfers from a depreciable block exceed transfer expenses, opening WDV and acquisition cost.
Section 74 prescribes that when consideration received or accruing in a tax year for transfers of one or more assets in a depreciable block exceeds, after deducting transfer-related expenditure, the opening written-down value of the block and the actual cost of additions during the year, the excess is deemed to be capital gains arising from the transfer of short-term capital assets; if the entire block is transferred in the year, cost of acquisition is the opening WDV plus costs of additions and resulting receipts are similarly deemed short-term capital gains.
Act Rules Income Tax
Show AI Summary
Deemed cost of acquisition: prior-owner cost continuity and formulaic apportionment govern non purchase transfers and restructurings.
Section 73 prescribes deemed cost of acquisition rules for assets received by non-purchase modes: generally continuing the previous owner's cost (adjusted for improvements) and prescribing formulaic apportionment or fair market value bases for corporate reorganisations, mutual fund segregations/consolidations and specified instruments, with application guided by cross-references and delegated definitions.
Act Rules Income Tax
Show AI Summary
Indexation of acquisition costs limited to prescribed computation item, narrowing administrative discretion and clarifying taxpayer application.
Section 72 prescribes that capital gains equal the full value of consideration less specified deductions (transfer expenditures, cost of acquisition and improvements), with indexation applying in prescribed contexts as indexed equivalents; it excludes certain items from deduction, provides cost adjustments for business trust distributions, grants specified entities additional prescribed deductions, and imposes special currency conversion and rupee appreciation rules for non residents, while defining indexed cost calculations by reference to a Cost Inflation Index.
Act Rules Income Tax
Show AI Summary
Tax-neutrality for corporate reorganisations, IFSC fund relocations, non-resident transfers and conversions subject to specified conditions.
Section 70 treats specified transfers as not constituting a transfer for capital gains, rendering many corporate reorganisations, succession transfers, conversions, certain non-resident-to-non-resident transactions and relocations of foreign funds into IFSC-located resultant funds tax-neutral only where qualifying tests - including shareholding continuity, residency/domestic-company status, regulatory registration and non-taxation in the foreign jurisdiction - and documentary conditions are satisfied.
Act Rules Income Tax
Show AI Summary
Specified derivative transaction criteria change tax classification and impose documentary and platform compliance obligations for derivative trades.
The enacted Section 66 narrows and reorders interpretive definitions governing Chapter IV D, alters key terms (including shifting focus from "commodity derivative" to "commodities transaction tax"), moves some enterprise classifications to notification based criteria, and changes successor/predecessor coverage. It also revises the functional tests and documentary preconditions for specified derivative transaction and speculative transaction status - emphasising electronic execution, prescribed platforms/intermediaries and time stamped contract notes with UCI and PAN - thereby creating clear compliance triggers and greater reliance on delegated notifications and rules.
Act Rules Income Tax
Show AI Summary
Maintenance of books of account: record keeping duty for specified professions and businesses; Board to prescribe particulars and retention.
Section 62 requires maintenance of books and documents to enable computation of total income by specified professions, businesses meeting alternative income or turnover tests, and professions notified by the Board. The Board may prescribe the form, particulars, manner, place and retention periods. The enacted text repositions the Board's notification power into the definition of specified professions, corrects an apparent turnover threshold error for individuals/HUFs, and revises cross references affecting deemed profits carve outs; operational details depend on subsequent rules and the referenced tables.
Act Rules Income Tax
Show AI Summary
Presumptive taxation for non resident activities fixes taxable profits on defined receipts and narrows audit relief.
Section 61 prescribes a presumptive taxation method for six specified non resident activities, fixing taxable profits as percentages of defined receipts (A and B) and supplying definitions and examples for those receipts; it bars deductions or losses against income so computed, prescribes written down value treatment, and permits audit based claims of lower actual profits only where expressly allowed and subject to strict bookkeeping and audit compliance, while the Act narrows those reliefs and clarifies definitional and non application provisions.
Act Rules Income Tax
Show AI Summary
Presumptive taxation regime clarified for small businesses and goods carriage operators, altering computation and compliance timing.
Section 58 creates a presumptive taxation regime for small businesses, goods carriage operations and specified professions, prescribing turnover limits and fixed presumptive computation methods. Taxpayers may elect actual profits but must maintain books and obtain an audit if total income exceeds the basic exemption limit. The enacted text clarifies that receipts received by specified banking or online modes count for a lower percentage only if received during the tax year or before the due date, treats non account payee cheques/bank drafts as cash for cash tests, and expressly excludes goods carriage receipts from aggregation for monetary limits under book keeping/audit rules.
Act Rules Income Tax
Show AI Summary
Deemed consideration: stamp duty value may be treated as full value where declared consideration is lower.
The provision deems the stamp duty value to be the full value of consideration for transfers of non-capital land or buildings where declared consideration is below stamp duty value, subject to a statutory tolerance that preserves actual consideration if stamp duty value is within a specified margin; agreement date stamp valuations may be used when agreement and registration dates differ provided consideration (or part) was received by specified banking/online modes on or before the agreement date, with determination mechanics governed by cross referenced valuation rules.
Act Rules Income Tax
Show AI Summary
Amortisation rules for telecom spectrum and licence fees require time spread deductions and proceeds offset on transfer.
The section prescribes amortisation in equal instalments for four categories of expenditure-amalgamation/demerger costs, SVR payments, spectrum fees and licence fees-starting from specified initial tax years (event/payment or later of business commencement/payment) and, for spectrum/licence, running co terminous with the life of the right. Transfers of spectrum/licence rights trigger offsetting of proceeds against remaining unallowed expenditure with specified income inclusion rules and a formula for part transfers; amalgamation/demerger transfers to an Indian company preserve the section's application to the successor. Depreciation exclusion and reassessment mechanics for wrongful allowance are also provided.
Act Rules Income Tax
Show AI Summary
Amortisation of prospecting expenditure permits staged tax deduction subject to funding reductions, exclusions and audit conditions.
Amortisation allows an Indian company or resident (other than a company) engaged in prospecting for specified minerals to capitalise qualifying expenditure incurred in the year of commercial production and up to four preceding years, claim periodic instalments after reducing amounts funded by others and realizations (sale, salvage, compensation, insurance), and excluding site/deposit acquisitions and depreciable capital assets; instalments are limited so as not to reduce income from commercial exploitation below nil, unallowed amounts may be carried forward within the overall amortisation period, and audit and prescribed reporting are required for non-company assessees.
Act Rules Income Tax
Show AI Summary
Site restoration fund deductions for petroleum operations, with recapture on asset disposals governed by Schedule X.
Section 49 creates a Site Restoration Fund regime for petroleum and natural gas operations under a Central Government agreement, allowing deductions for deposits to a designated special account or site restoration account with computation governed by Schedule X. Withdrawals or transfers from those accounts are taxable in the year of withdrawal/transfer under Schedule X. The Act removes a clause in the Bill that explicitly deemed a portion of asset cost relatable to prior deductions as business income on sale within a specified holding period, instead delegating disposal and recapture rules to Schedule X.
Act Rules Income Tax
Show AI Summary
Recapture on premature disposal reverses deduction for deposits into designated tea, coffee and rubber development accounts, taxing attributable cost on disposal.
Clause 48 permits a deduction for deposits into designated tea, coffee and rubber development accounts, with computation governed by Schedule IX; withdrawals or transfers are chargeable to tax in the year of transfer/withdrawal as per Schedule IX, and disposal of assets acquired under the scheme within the protective holding period results in deeming that portion of the asset cost attributable to earlier deductions as business income in the year of sale or transfer.

TMI Notes

Back

All TMI Notes

Showing Results for :
Reset Filters
No Records Found

TMI Notes

Back

All TMI Notes

Comparison of section 351 "Specified violation." between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)

11 September, 2025

Contents
Acts
Rules & Regulations
Summary
Note

Note

-

Bookmark

Print

Print

Section 351 Specified violation.

Income-tax Act, 2025

At a Glance

These texts set out Clause/Section 351 dealing with "specified violation" by a registered non-profit organisation under the Income Tax Bill, 2025 (old version) and the enacted Income-tax Act, 2025. They matter because they prescribe grounds and procedure for cancellation of registration of non-profit organisations and thus affect taxpayers (registered non-profit entities), tax administration (Principal Commissioner/Commissioner and Assessing Officers), and the broader charitable sector. Effective/commencement dates: Not stated in the document.

Background & Scope

Statutory hooks: Clause/Section 351 appears in Part IV (Violations) of the Income Tax Bill, 2025 / Income-tax Act, 2025. The provision addresses "specified violation" by a registered non-profit organisation and grants the Principal Commissioner or Commissioner power to inquire, call for documents, and pass orders including cancellation of registration. Definitions or extended explanations of terms used (e.g., "registered non-profit organisation", "objects", "commercial activity", or cross-referenced sections 332, 345, 346, 270(13)) are Not stated in the document.

Statutory Provision Mode

Text & Scope

The provision enumerates specified violations by a registered non-profit organisation, namely:

  • application of income otherwise than for its objects;
  • carrying out commercial activity in contravention of section 345 or 346 (enacted) / section 345 (Bill);
  • application of any part of total income for private religious purposes which does ensure/enure for the benefit of the public;
  • post-commencement organisations for charitable purpose applying income for benefit of particular religious community or caste other than SCs/STs or backward classes or women and children;
  • activities that are not genuine or not carried out in accordance with registration conditions;
  • non-compliance with requirements of other law as referred u/s 332(7)(a) and where the order/direction/decree is either undisputed or final;
  • false or incorrect information in the application referred to in section 332(1).

Procedure: Where the Principal Commissioner/Commissioner has noticed one or more specified violations, receives a reference from the Assessing Officer u/s 270(13), or the organisation is selected per Board-formulated risk strategy, the officer shall call for documents/inquiries, and then pass an order in writing either cancelling registration (after reasonable opportunity of being heard) for such tax year and subsequent years if satisfied violation occurred, or not cancelling if not so satisfied; copy to AO and organisation. Timeline: order to be passed within six months calculated from end of quarter in which first notice was issued calling for documents/inquiry.

Interpretation

Legislative intent indicated by text: the provision aims to create a statutory mechanism to protect the tax base by identifying specified breaches by non-profit organisations and providing a structured administrative route for cancellation of registration, incorporating procedural safeguards (opportunity of being heard, timelines). The text signals an intent to link tax-registration consequences to both internal misapplication of funds and external non-compliance with other laws.

Exceptions/Provisos

Carve-outs or conditions in the text include:

  • Cancellation is to be preceded by giving a reasonable opportunity of being heard.
  • Non-compliance under other laws is actionable only where the order/direction/decree "has either not been disputed, or has attained finality" (enacted text).
  • Specific temporal limitation on decision-making: order must be passed within six months from quarter-end of first notice.

Illustrations

  • Example 1: A registered non-profit uses grants to pay director's personal expenses - this falls under clause (a) (application other than for objects) and can trigger inquiry and potential cancellation if established. (Facts consistent with text.)
  • Example 2: A post-commencement charitable organisation awards scholarships exclusively to a single non-protected religious community (not SC/ST/backward classes/women/children) - under clause (d) this could be a specified violation. (Facts consistent with text.)
  • Example 3: A registered non-profit running a business arm in contravention of section 346 (enacted) would fall under clause (b) and could be subject to cancellation proceedings. (Facts consistent with text.)

Interplay

The provision cross-refers to sections 345, 346, 332(7)/(7)(a), 332(1), and 270(13). Specific interaction with Rules, Notifications or Circulars is Not stated in the document. The provision situates administrative power with Principal Commissioner/Commissioner while involving Assessing Officer by reference and communication; how this aligns with broader registration/renewal procedures or appeal remedies is Not stated in the document.

Differences between the two provisions and practical impact

  • Reference to section 345/346 (commercial activity): Old Bill (Document 2) lists contravention only of section 345; the enacted Section 351 (Document 1) lists contravention of the provisions of section 345 or 346.
    • Practical impact: expansion of trigger-more commercial-activity-related conduct (covered in section 346) can now constitute a specified violation, increasing exposure to cancellation for NGOs engaged in commercial activities that fall within section 346.
  • Wording on timing/temporal scope of cancellation: Old Bill states cancellation may be "for such tax year during which such specified violation took place and all subsequent tax years." Enacted Section omits the phrase "for such tax year during which such specified violation took place," instead providing cancellation "for such tax year and all subsequent tax years."
    • Practical impact: enacted text is arguably broader or at least less temporally precise; it appears to allow cancellation beginning with the relevant tax year (same as Bill) but the slight drafting change reduces explicit limitation language-practically similar but drafting difference could affect interpretation of retrospective/prospective reach if disputes arise.
  • Reference to compliance with other laws (section 332(7)): Old Bill refers to "requirements u/s 332(7)"; enacted Section refers to "requirements of any other law as referred u/s 332(7)(a) and the order, direction or decree... has either not been disputed, or has attained finality."
    • Practical impact: enacted provision clarifies that the non-compliance is with "any other law as referred u/s 332(7)(a)" (narrower/clarified cross-reference) and adds explicit textual emphasis that the order/direction/decree must either be undisputed or final. This makes the ground for cancellation contingent on a final/undisputed determination under those other laws.
  • Typographical/word choice correction: Enacted Section corrects "enure" to "ensure" (via corrigenda).
    • Practical impact: corrects potential ambiguity in clause (c) regarding private religious purposes "which does ensure for the benefit of the public" (document shows correction but intended meaning remains that such private religious application must not ensure public benefit). Substance unaffected except removal of typographical error.
  • Minor drafting/formatting differences: Enacted provision adds subparagraph labeling and slightly reorders phrasing (e.g., subsection (2)(a) temporal phrase "Where,--" vs Bill's "Where during any tax year,--").
    • Practical impact: no substantive change except possible differences in interpretive emphasis on temporal locus of detection; enacted text's condition list in (2) is substantively the same but more tightly cross-referenced in some places.

Practical Implications

  • Compliance and risk areas grounded in the text: strict internal compliance with objects and permitted uses of income; careful structuring of any commercial activities to avoid contravention of sections 345/346; avoidance of private-religious-purpose applications that do not benefit the public; adherence to registration conditions; ensure accuracy of initial registration application (section 332(1)).
  • Record-keeping/evidence points suggested by the text: documentary evidence of application of income to objects, minutes/authorisations for activities, contracts and accounts for commercial activities, demonstration of public benefit for religious activities, evidence of compliance with other laws (and any orders/directions) and dispute status thereof, and documentation submitted in registration application-since false/incorrect application information is a specified violation.

Key Takeaways

  • Clause/Section 351 lists seven discrete grounds that may constitute a "specified violation" leading to cancellation of registration of a registered non-profit organisation.
  • Enacted text expands commercial-activity trigger to include contravention of section 346 in addition to section 345, broadening potential exposure.
  • Cancellation can be ordered by Principal Commissioner/Commissioner after inquiry and hearing, and must be communicated to the Assessing Officer and organisation.
  • Non-compliance under other laws is actionable where the external order/direction/decree is undisputed or final, per enacted text.
  • Administrative timeline: order must be passed within six months from the quarter-end of the first notice calling for documents/inquiry.
  • Accuracy of registration application is critical-false or incorrect information is an explicit ground for specified violation.
  • Certain drafting differences between Bill and Act (e.g., reference to section 346 and clarified cross-reference to section 332(7)(a)) may have practical consequences for scope and enforcement.

Full Text:

Section 351 Specified violation.

Topics

Acts Income Tax