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 ✕
🔎 TMI Notes - Adv. Search
TEXT SEARCH:

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 175 "Avoidance of tax by certain transactions in securities." between the Inco...
    Act Rules Income Tax
    Comparison of Section 166 "Reference to Transfer Pricing Officer." between the Income-Tax Act, 2025 ...
    Act Rules Income Tax
    Comparison of Section 165 "Determination of arm's length price." between the Income-Tax Act, 2025 (a...
    Act Rules Income Tax
    Comparison of Section 164 "Meaning of specified domestic transaction." between the Income-Tax Act, 2...
    Act Rules Income Tax
    Comparison of Section 162 "Meaning of associated enterprise." between the Income-Tax Act, 2025 (as p...
    Act Rules Income Tax
    Comparison of Section 156 "Rebate of income-tax in case of certain individuals." between the Income-...
    Act Rules Income Tax
    Comparison of Section 153 "Deduction for interest on deposits." between the Income-Tax Act, 2025 (as...
    Act Rules Income Tax
    Comparison of Section 150 "Interpretation for purposes of section 149." between the Income-Tax Act, ...
    Act Rules Income Tax
    Comparison of Section 149 "Deduction in respect of income of co-operative societies." between the In...
    Act Rules Income Tax
    Comparison of Section 143 "Special provisions in respect of certain undertakings in North-Eastern St...
    Act Rules Income Tax
    Comparison of Section 135 "Deduction in respect of certain donations for scientific research or rura...
    Act Rules Income Tax
    Comparison of Section 124 "Deduction in respect of employer and assessee contribution to pension sch...
    Act Rules Income Tax
    Comparison of Section 119 "Carry forward and set off of losses not permissible in certain cases." be...
    Act Rules Income Tax
    Comparison of Section 118 "Carry forward and set off of losses and unabsorbed depreciation in busine...
    Act Rules Income Tax
    Comparison of Section 115 "Set off and carry forward of losses from specified activity." between the...
    Act Rules Income Tax
    Comparison of Section 114 "Set off and carry forward of losses computed in respect of specified busi...
    Act Rules Income Tax
    Comparison of Section 113 "Set off and carry forward of losses computed in respect of speculation" b...
    Act Rules Income Tax
    Comparison of Section 112 "Carry forward and set off of business loss." between the Income-Tax Act, ...
    Act Rules Income Tax
    Comparison of Section 111 "Carry forward and set off of loss from Capital gains." between the Income...
    Act Rules Income Tax
    Comparison of Section 110 "Carry forward and set off of loss from house property." between the Incom...
❯❯
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
Deeming rule for dividends: economic owner taxed where transfers separate entitlement from legal receipt.
Section 175 deeming rule attributes interest and dividends to the original owner or beneficial holder when securities transactions separate economic entitlement from legal receipt, applies on day to day accrual where beneficial interest existed during a year, operates irrespective of other charging provisions, allows the Assessing Officer to require ownership details, and includes a business of dealing carve out and short term record date anti arbitrage rules that ignore specified losses and adjust cost of additional securities.
Act Rules Income Tax
Show AI Summary
Reference to Transfer Pricing Officer centralises arm's length price determination, binding assessments and enabling validated multi year application.
An Assessing Officer, with prior supervisory approval, may refer determination of the arm's length price for international or specified domestic transactions to a designated Transfer Pricing Officer who issues a written order after notice and hearing; that TPO order is binding on the Assessing Officer for computing total income, and an opt in permits validated application of the TPO's determination to the two immediately following tax years subject to prescribed conditions and recomputation procedures.
Act Rules Income Tax
Show AI Summary
Arm's length price determination allows limited acceptance of actual transaction price; AO may redetermine ALP after show-cause.
Arm's length price must be determined using specified transfer pricing methods or other Board prescribed methods, selecting the most appropriate method based on transaction nature, functions and prescribed factors. If a single method yields one price that price governs; a notified tolerance permits acceptance of the actual transaction price in specified cases. The Assessing Officer may determine the arm's length price during assessment where documentation, reliability, or compliance with notice requirements is deficient, but must first give the taxpayer a show cause notice before recomputing total income on that basis.
Act Rules Income Tax
Show AI Summary
Specified domestic transaction definition narrows domestic related party scope and imposes an aggregate threshold triggering special anti avoidance rules.
Section 164 defines specified domestic transaction for the Chapter on avoidance of tax by enumerating categories of domestic dealings (cross referencing sections 122, 140(9), 140(13), Chapter VIII, section 144 and section 205(4)) and by permitting additional prescribed transactions; each item is subject to exclusion of international transactions and to an annual aggregate materiality threshold that determines applicability.
Act Rules Income Tax
Show AI Summary
Associated enterprise definition expands to objective participation and dependence tests, broadening related party compliance risks.
Clause 162 defines associated enterprise by a general participation test (direct, indirect or through intermediaries in management, control or capital, or common persons participating therein) and a non exhaustive deeming list operative at any time during the tax year that includes objective thresholds and indicia such as minimum shareholding, reciprocal holdings, loan exposure relative to book assets, guarantee exposure, appointment control, IP dependence, supply/purchase dependence, family/common control and a residual mutual interest relationship subject to prescription; for specified domestic transactions the definition is expanded to include other units of the assessee and cross referenced persons or enterprises.
Act Rules Income Tax
Show AI Summary
Tax rebate for resident individuals: post calculation reduction of tax up to capped amounts with special formula for higher incomes.
A deduction from income tax payable is available to resident individual assessees in specified income bands: tax is computed first and then reduced by a rebate subject to fixed monetary caps; for incomes above the higher threshold a formulaic reduction by the excess income is prescribed, and any deduction is capped so it does not exceed tax payable under the referenced computation provision.
Act Rules Income Tax
Show AI Summary
Deduction for interest on deposits: account-type ceilings differ by seniority, with senior citizens' scope including time deposits.
Deduction for interest on deposits permits individuals (distinctly identifying senior citizens) and HUFs to claim limited deductions on interest from deposits with regulated banks, cooperative societies and Post Offices, subject to monetary ceilings and account-type limits: non-senior individuals and HUFs are restricted to interest from savings accounts excluding time deposits, senior citizens are allowed a broader deduction described as applying to savings accounts and expressly including time deposits, and no deduction is permitted where the deposit is held by or on behalf of a firm, association of persons or body of individuals; "time deposits" are defined as deposits repayable on expiry of fixed periods.
Act Rules Income Tax
Show AI Summary
Time bound deduction for Producer Companies allows full tax relief for profits from defined member related agricultural activities, subject to sequencing.
A time bound tax incentive allows Producer Companies, as defined in the Companies Act, to claim a full deduction for profits attributable to an eligible business (marketing members' agricultural produce; supplying members with agricultural inputs; processing members' agricultural produce), subject to a turnover ceiling and a sequencing rule that permits the deduction only after other Chapter deductions; the clause omits attribution, anti abuse and procedural rules, creating compliance uncertainty.
Act Rules Income Tax
Show AI Summary
Deduction for co-operative societies: specified cooperative income receives preferential tax deductions, subject to governance and computation rules.
Clause 149 permits targeted tax deductions for co operative societies by fully or partially deducting income attributable to enumerated cooperative activities (banking/credit to members, cottage industries, marketing of members' agricultural produce, supply of agricultural inputs, processing without power, collective disposal of members' labour, and fishing/allied activities), supplies by primary societies to federal cooperatives or government entities, inter cooperative investment income, and income from letting godowns; certain non specified activities qualify only up to capped amounts, governance restrictions on voting rights condition some deductions, and cooperative deductions are computed after reducing specified pre existing deductions.
Act Rules Income Tax
Show AI Summary
Special tax deduction for North-Eastern undertakings grants full profit exemption for a fixed consecutive period.
A 100% deduction of profits and gains is available to undertakings in specified North-Eastern States for ten consecutive tax years starting from an "initial tax year", contingent on commencement or substantial expansion within a discrete qualifying window, formation and newness-of-plant conditions, exclusions for specified goods and activities, a defined test for "substantial expansion", and exclusivity preventing concurrent Chapter deductions; cross-referenced provisions determine treatment of re-established entities and aggregate duration limits.
Act Rules Income Tax
Show AI Summary
Deduction for research donations: tax relief for approved gifts subject to verification and specified exclusions.
Deduction is allowed for donations to approved research associations or educational institutions for scientific or social science/statistical research, contingent on recipient approval and information furnished by the payee to the prescribed income tax authority and subject to the Board's risk based verification; deductions are excluded where the donor has business/profession income or where contributions in cash exceed the prescribed threshold, and deduction is not to be denied solely because recipient approval is later withdrawn.
Act Rules Income Tax
Show AI Summary
Pension contribution deduction: employer and individual pension contributions receive tax relief, with caps and deeming rules affecting receipt.
Section 124 allows deductions for employer contributions to Central Government notified pension schemes subject to employer type percentage ceilings and for individual deposits into such schemes subject to an overall statutory cap; parent or guardian deposits for minors are aggregated with the individual cap. The provision defines salary for this purpose to include dearness allowance where employment terms so provide, disallows duplicate deduction where relief was claimed under the related provision, and deems amounts received on closure, opt out, or as annuity taxable in the year of receipt, with limited exceptions for nominee/parent/guardian receipts on death.
Act Rules Income Tax
Show AI Summary
Loss carry-forward restrictions: beneficial ownership and voting-power continuity determine entitlement to set off historic losses.
The section restricts carry forward and set off of losses on change in firm constitution, succession other than by inheritance, and change in shareholding of non-public companies unless continuity of beneficial ownership of shares carrying not less than fifty-one percent of voting power is maintained or specified exceptions (death, gift to relative, certain amalgamations/demergers, insolvency resolution plans with opportunity to be heard, tribunal-approved restructuring, relocation, and a start-up carve-out) apply.
Act Rules Income Tax
Show AI Summary
Carry-forward of predecessor losses: successor bank may set off losses as if reorganisation had not occurred, subject to continuity conditions.
Section 118 permits successor or resulting co operative banks to carry forward and set off predecessor accumulated losses and unabsorbed depreciation on amalgamation or demerger "as if the business reorganisation had not taken place," subject to the Act's set-off and depreciation rules. Demergers transfer directly attributable losses to the resulting undertaking and require pro rata apportionment of non direct losses by asset distribution. Qualification depends on continuity of banking activity and specified fixed asset holding thresholds, deemed tax year splitting, prescribed/notified conditions, and denial of set offs as taxable income upon non compliance.
Act Rules Income Tax
Show AI Summary
Ring-fencing of race-horse losses restricts set-off to stake-money income and allows limited carry forward period.
Losses from owning and maintaining race horses are ring-fenced and may be set off only against income from the same specified activity (stake money). Unabsorbed losses may be carried forward for set-off solely against future stake-money income in years when the assessee carries on the specified activity, subject to a limited carry-forward period after which unabsorbed amounts expire. Definitions narrow the scope of eligible income and losses.
Act Rules Income Tax
Show AI Summary
Set-off restriction for specified business losses limits use to profits of other specified business activities only.
Losses computed in respect of a specified business carried on by the assessee in a tax year may be set off only against profits and gains of other specified business activities for that year; any portion not so set off is an unabsorbed loss that may be carried forward and set off only against profits and gains of specified businesses in subsequent years.
Act Rules Income Tax
Show AI Summary
Speculation loss ring fencing: losses only offset against speculation profits with limited carry forward and priority in set off.
Losses from speculation business may be set off only against speculation business profits; any unabsorbed speculation business loss is carried forward and set off only against future speculation business profits, subject to a statutory temporal limitation and applied before certain other carried forward allowances. A deeming rule treats companies buying and selling shares of other companies as carrying on speculation business to that extent, subject to carve outs where specified income heads or principal business activities prevail.
Act Rules Income Tax
Show AI Summary
Carry forward of unabsorbed business loss limited to set off only against business profits, with a temporal carry forward limit.
Unabsorbed business loss (loss under Profits and gains of business or profession excluding speculation loss not absorbed under inter head set off) shall be carried forward and may be set off only against business or profession profits in subsequent years; any amount not so set off is carried forward iteratively, subject to a limit of not more than eight succeeding tax years, and such unabsorbed loss is to be given effect before allowing set off of specified carried forward allowances.
Act Rules Income Tax
Show AI Summary
Carry forward of capital losses: limited temporal carry forward with distinct set off rules for long term and short term losses.
A statutory regime prescribes distinct set off rules for losses under the head Capital gains: short term capital losses may be set off against gains from any other capital asset, long term capital losses only against gains from other long term assets, and any residual loss after intra year set off qualifies for carry forward but only for a limited number of succeeding tax years; the Bill defined this residual as an unabsorbed capital loss, whereas the enacted provision omits that label but retains equivalent practical effect.
Act Rules Income Tax
Show AI Summary
Carry-forward restriction of house property losses confines set-off to future house property income with a time-limited ceiling.
Residual losses computed under Income from house property that are not wholly absorbed by intra-year set-off qualify as unabsorbed loss from house property and may be carried forward, to be set off only against future house property income in subsequent years until the loss is absorbed or the statutory temporal limit expires; the clause defines the qualifying unabsorbed loss by reference to prior application of intra-year set-off rules.

TMI Notes

Back

All TMI Notes

Showing Results for :
Reset Filters
No Records Found

TMI Notes

Back

All TMI Notes

Showing Results for : Reset Filters

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