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
    Case Laws Income Tax
    Addition u/s 69A - ambit of the word "owner" and "valuable article" for the purpose of additions as ...
    Case Laws Income Tax
    Pharmaceutical companies’ gifting freebies to doctors, etc. - whether Allowable Business expenditu...
    Case Laws Income Tax
    Impact of belated deposit of employees’ contribution towards the EPF and ESI under Income Tax
    Case Laws Income Tax
    Reassessment conducted after 4 years by Income Tax Authorities.
    Case Laws Income Tax
    Strictures against the Income Tax Office - abuse of authority by the revenue officers, ignoring the...
    Case Laws Income Tax
    Introduction of concept of mediation and Advance Ruling System for Residents to reduce tax litigatio...
    Case Laws Income Tax
    Reopening of assessment u/s 147 - Notice issues u/s 148 kept in abeyance since the issue of Deductio...
    Case Laws Income Tax
    Reopening of assessment - Substance over Form - Failure to disclose material fact - Duty of the AO t...
    Act Rules Income Tax
    Facility of Form SUGAM (ITR-4) - List of person who are eligible and who are not eligible to avail t...
    Act Rules Income Tax
    Facility of Form SAHAJ (ITR-1) - List of person who are eligible and who are not eligible to avail t...
    Manuals Income Tax
    Can a Non-Resident claim deduction u/s 80QQB for royalty income ?
    Manuals Income Tax
    What is the minimum donation limit to get tax deduction u/s 80GGA?
    Manuals Income Tax
    What are the conditions to claim deduction u/s 80GG?
    Manuals Income Tax
    Is loan taken in name of any family member is eligible for deduction u/s 80E?
    Manuals Income Tax
    What is the main difference between deduction u/s 80U & u/s 80DD of the Act?
    Manuals Income Tax
    Can a taxpayer claim deduction u/s 80DD for himself?
    Manuals Income Tax
    Whether deduction u/s 80D is allowed if expenditure is made in cash?
    Manuals Income Tax
    Can an individual pay medical insurance premium for spouse and claim deduction u/s 80D?
    Manuals Income Tax
    Can a Guardian claim tax benefit u/s 80CCG if investment is done in the name of Minor?
    Manuals Income Tax
    Can a non resident individual join NPS u/s 80CCD?
❮
❯
❯❯
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
Case Laws Income Tax
Show AI Summary
Ownership for unexplained articles must reflect real ownership rights, not mere carrier possession, to trigger tax implications.
Section 69A applies only where the assessee can properly be regarded as the owner of the item and the item is an other valuable article; a carrier or bailee lacks ownership rights unless wrongful retention or misappropriation confers exclusive control akin to ownership, and an article qualifies as "valuable" by per unit marketability and premium price rather than aggregate value of ordinary low cost goods such as bitumen.
Case Laws Income Tax
Show AI Summary
Tax deduction denial for pharmaceutical freebies: expenses excluded under Explanation 1 to Section 37(1) as prohibited by law.
Whether expenditures by pharmaceutical companies for distribution of incentives to medical practitioners are allowable under Section 37(1) depends on Explanation 1 to Section 37(1), which disallows deductions for purposes that are an offence or are prohibited by law; because medical ethics regulations prohibit doctors from accepting such freebies and attach punishments, donors' provision of those incentives is treated as participation in proscribed conduct and such expenses are not allowable as business deductions.
Case Laws Income Tax
Show AI Summary
Belated employees' contribution: deduction disallowed when not deposited by prescribed statutory due date; employer contribution treated differently.
Non-deposit of employees' contribution within the due date prescribed under the respective provident/insurance statute results in disallowance of the employer's deduction, whereas employer contributions are subject to a separate payment-based rule that defers deduction until actual payment. The statutory scheme preserves distinct treatment: employee contributions must be credited by the statutory due date to qualify as deduction, while employer contributions may be allowed on a payment basis when actually paid.
Case Laws Income Tax
Show AI Summary
Reopening assessments beyond four years barred where full and true disclosure eliminates omission to disclose material facts.
Reopening an assessment beyond four years is permissible only if there was an omission to disclose material facts; where the assessee had fully and truly disclosed loan and interest details and the assessing officer merely sought a different view on deduction versus capitalization using the same material, the condition precedent for reopening under the proviso is not met and the notice to reopen cannot be sustained.
Case Laws Income Tax
Show AI Summary
Abuse of revenue authority: improper recoveries and refund adjustments contrary to statutory stay and intimation safeguards.
The note addresses revenue practice of effectuating recoveries and adjusting taxpayer refunds without complying with statutory safeguards, characterising such conduct as an abuse of authority and a breach of constitutional taxation limits under Article 265. It emphasises that filing an appeal precludes an assessee from being treated as an 'assessee in default' for recovery purposes under the statutory stay framework, and that automatic adjustment of refunds against demands without prior intimation and opportunity of hearing conflicts with the statutory process for refund adjustment and recovery.
Case Laws Income Tax
Show AI Summary
Advance Ruling System can reduce tax litigation and provide binding certainty for taxpayers, urging reform and institutional strengthening.
Recommend comprehensive reform of the Advance Ruling regime to reduce tax litigation by improving AAR capacity and timeliness, lowering the high resident eligibility threshold, and creating an institutional council modeled on Swedish and New Zealand systems so advance rulings become a practicable, binding, and transparent mechanism to provide tax certainty and narrow further challenges.
Case Laws Income Tax
Show AI Summary
Reopening of assessment: Section 148 notices held in abeyance pending Supreme Court decision on Section 80P deduction entitlement.
Reopening of assessment under Section 147 and notices under Section 148 to cooperative societies were stayed and kept in abeyance pending disposal of Special Leave Petitions concerning entitlement to deduction under Section 80P(2)(a)(i) read with Section 80P(4). The High Court ordered that if the Supreme Court allows the SLPs the notices will revive and reassessment may proceed, and if the Supreme Court rules for the assessees the impugned notices will be set aside.
Case Laws Income Tax
Show AI Summary
Substance over form requires assessing officers to inquire beyond certified statutory forms before reopening assessments.
Non-disclosure must be sufficiently material to show that, but for it, income would have escaped assessment; Assessing Officers must not rely mechanically on CA-certified statutory forms and must make independent enquiries, applying the substance over form principle when determining commencement of commercial production or eligibility for tax concessions.
Act Rules Income Tax
Show AI Summary
Eligibility for SUGAM ITR-4: resident individuals, HUFs and resident firms with presumptive business income may use the simplified return.
Eligibility to file Form SUGAM (ITR-4) is limited to resident individuals, resident HUFs (other than not ordinarily resident), and resident firms (excluding LLPs) deriving business or professional income computed under presumptive provisions of sections 44AD, 44ADA or 44AE. Explicit exclusions bar persons with foreign assets/signing authority/income, directorships, unlisted equity holdings in the previous year, income above the prescribed limit, more than one taxable house property, brought forward or carry forward losses, assessments where tax was deducted in another's hands, claims under double taxation provisions or deduction under section 91, certain agricultural income, and incomes taxable under specified special heads.
Act Rules Income Tax
Show AI Summary
ITR form eligibility limited to resident individuals with salary, single house and non lottery other income; foreign interests excluded.
Form SAHAJ (ITR 1) is available only to resident individuals whose taxable income arises solely from salaries or family pension, income from a single house property without brought forward or current losses under that head, and other sources excluding lottery winnings and race horse income, provided they do not fall into disqualifying categories such as foreign assets, foreign income or signing authority, income requiring apportionment, directorships, unlisted equity shareholdings, tax assessed on income with TDS in another person's hands, claims for double taxation relief, specified deductive claims, agricultural income above a small threshold, or total income above the prescribed upper limit.
Manuals Income Tax
Show AI Summary
Deduction for authors' royalty income available only to resident authors under income tax rules; non-residents are ineligible.
The deduction for authors' royalty income under section 80QQB is limited to individual taxpayers who are resident-either resident and ordinarily resident or resident but not ordinarily resident-and excludes non-resident authors, so non-residents cannot claim the royalty deduction.
Manuals Income Tax
Show AI Summary
Tax deduction under 80GGA allows any donation amount for scientific research or rural development to be claimed.
Section 80GGA provides a tax deduction for sums donated for specified purposes of scientific research or rural development; there is no prescribed minimum donation threshold and any amount paid for the specified purpose is eligible for deduction.
Manuals Income Tax
Show AI Summary
Deduction under 80GG: individuals paying rent must submit Form 12BA to claim a rent deduction.
An individual who pays rent for residential accommodation may claim deduction in respect of rent paid provided the claimant submits a written declaration in Form 12BA to the assessing officer asserting entitlement; the deduction is contingent on both actual rent payment and timely submission of the prescribed declaration.
Manuals Income Tax
Show AI Summary
Deduction under section 80E not available if education loan is taken in a family member's name.
Deduction under section 80E for interest on higher education loans is available only where the assessee is the named borrower; loans taken in the name of a relative or other family member do not qualify for the deduction, because the borrower identity is the operative condition for entitlement.
Manuals Income Tax
Show AI Summary
Disability deduction: dependent relief under one provision versus taxpayer's own deduction under the other provision.
Section 80DD provides a deduction for maintenance, including medical treatment, of a handicapped dependent claimed by the taxpayer, whereas Section 80U provides a deduction available to the taxpayer who is himself or herself a person with disability; the key distinction is whether the deduction is for a dependent or for the disabled taxpayer.
Manuals Income Tax
Show AI Summary
Section 80DD deduction applies only for maintenance of a disabled dependent, not for the taxpayer's own disability.
Deduction under 80DD permits an income tax deduction for maintenance, including medical treatment, of a handicapped dependent who is a person with disability; the deduction is available for expenditure in respect of such a dependent and is not available to a taxpayer for his or her own disability-related expenses.
Manuals Income Tax
Show AI Summary
Deduction under section 80D denied for cash payments; only preventive health checkup expenses may be paid in cash.
Deduction for medical insurance premia under deduction u/s 80D is not available where the expenditure is made in cash; payments must be by non-cash modes to qualify, except that expenditure on preventive health checkups may be incurred in cash and still qualify for the deduction.
Manuals Income Tax
Show AI Summary
Medical insurance premium deduction allowed when an individual pays for spouse, self and dependents under section 80D.
An individual is entitled to claim a deduction for premiums paid for medical insurance covering the individual, the spouse, dependent children and parents under the medical insurance premium deduction framework; premiums paid by an individual for insurance on the health of those family members qualify for deduction.
Manuals Income Tax
Show AI Summary
Tax benefit under 80CCG: guardian may claim deduction for investments made in a minor's name, subject to individual limits.
A guardian who makes investments in a minor's name may claim the deduction under 80CCG, subject to the overall deduction limit applicable to the guardian as an individual and compliance with the scheme's conditions.
Manuals Income Tax
Show AI Summary
Non-resident individuals joining NPS: eligible to open accounts, but accounts close if citizenship changes under pension deduction rules.
Non resident individuals may join the National Pension System and make contributions eligible for pension contribution deduction under income tax provisions; however, an NPS account will be closed if the member's citizenship status subsequently changes, affecting continued participation and account maintenance.

TMI Notes

Back

All TMI Notes

Showing Results for :
Reset Filters
No Records Found

TMI Notes

Back

All TMI Notes

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)

12 September, 2025

Contents
Acts
Rules & Regulations
Summary
Note

Note

-

Bookmark

Print

Print

Section 354 Application for approval for purpose of section 133(1)(b)(ii).

Income-tax Act, 2025

At a Glance

Clause 354 of the Income Tax Bill, 2025 - Old Version sets out the statutory scheme for applications by registered non-profit organisations or specified persons for approval u/s 133(1)(b)(ii) (approval relevant to receipt of donations). It matters to charitable organisations, donors and 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 of validity of approvals. The text contains no defined terms other than references to "tax year," "registered non-profit organisation," and the referenced Schedule III; definitions of those terms are Not stated in the document. The Bill prescribes that forms, manner, statements, verifications, certificates to donors and correction statements shall be "prescribed" but the prescriptive instruments themselves are Not stated in the document.

Statutory Provision Mode

Text & Scope

Coverage: Clause 354 permits a registered non-profit organisation or a person listed in Schedule III (Table: Sl. No. 1) to apply to the Principal Commissioner or Commissioner for approval for the purpose of section 133(1)(b)(ii). The authority for application, the form and manner are to be as prescribed. The clause sets out seven express conditions (clauses (a) to (g)) that the applicant must satisfy or comply with:

  • (a) the organisation's activities are not expressed to benefit any particular religious community or caste;
  • (b) it is established in India for a charitable purpose and "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";
  • (c) no instrument or rules allow transfer of whole or part of assets for any purpose other than a charitable purpose;
  • (d) it maintains regular accounts of receipts and expenditure;
  • (e) it prepares and delivers a prescribed statement for prescribed periods, in prescribed form 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, provisional approvals, and expiry/renewal situations. The Table prescribes: provisional approvals for new applicants (three tax years), approvals for applicants with commenced activities (five tax years), and specific application windows and order timelines (one month for the month-end case; six months from end of quarter in other cases).

Interpretation

Legislative intent indicated by the text: The structure indicates an intent to balance facilitation of charitable funding (by providing a route to obtain approval relevant for donor deduction) with safeguards to ensure charitable character and compliance with other laws. The enumerated conditions focus on: non-discrimination by religion/caste; confinement of assets to charitable purposes; limits on religious expenditure; maintenance and submission of accurate accounts and statements; and donor-level certification. The procedural timeframe table suggests an intent to provide predictability in administrative processing. The text does not contain an express legislative statement of purpose or policy rationale beyond these provisions.

Exceptions/Provisos

No separate provisos or exceptions beyond the specified conditions and the Table are included in Clause 354. There are no express carve-outs for particular categories of organisations, acute exigencies, or definitions of "religious nature" expenditure. Any exceptions or further qualifying language is Not stated in the document.

Illustrations

  • Example 1: A registered non-profit 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.)
  • Example 3: An organisation incurs religious-nature expenditure equal to 5% of total income in a tax year. Under clause (b) its status is affected because clause (b) provides it "does not incur any expenditure of an amount being 5% or more..."-therefore, an organisation with exactly 5% religious expenditure would be ineligible. (The document does not provide a worked example; this is a textual reading of clause (b).)

Interplay

The clause refers to section 133(1)(b)(ii) as the substantive hook for approval but does not reproduce that section or explain the precise consequence of approval under that section. The clause references compliance "of such requirements of any other law in force" but does not specify which laws or how conflicts are to be resolved. The clause requires prescribed forms, statements and donor certificates but the relevant Rules or Notifications prescribing them are Not stated in the document. Interaction with income-tax assessment procedures, charitable trust law, the applicable Schedules (Schedule III), or other regulatory regimes is not elaborated in the text.

Differences between the two provisions and practical impact

  • Reference to Schedule: Document 1 (Section 354, Income-tax Act, 2025) refers to "Schedule VII (Table: Sl. No. 1)"; Document 2 (Clause 354, Income Tax Bill, 2025 - Old Version) refers to "Schedule III (Table: Sl. No. 1)".
    • Practical impact: This change alters which classes of persons fall within the eligibility reference. The precise 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/exclusive thresholds. Document 1 prohibits expenditure that exceeds 5% (i.e., expenditure >5% is prohibited; expenditure equal to 5% appears permissible). Document 2 prohibits expenditure that is "5% or more" (i.e., expenditure >=5% is prohibited). This is a material drafting difference: under Document 2 an organisation whose religious-nature expenditure equals exactly 5% of total income would be ineligible; under Document 1 that organisation would appear eligible. The documents do not provide further clarifying definitions or examples.
  • Minor drafting differences in procedural wording: The order and phrasing in sub-section (3) differ slightly. Document 2 frames the inquiries as being "in order to satisfy himself as to the compliance of such requirements of any other law in force, as are material for the purpose of achieving its objects, and the genuineness of activities," with an explicit conjunctive linking; Document 1 lists genuineness and compliance first then continues.
    • Practical impact: These are drafting variations that change emphasis but, on their face, not the substantive standard-the authority must be satisfied as to genuineness and compliance. Absent further context or definitions, the operational test remains similar. The document does not state any interpretive guidance about how these differences should be resolved.
  • Other variations: Minor differences (for example "as prescribed" versus "as may be prescribed") are present.
    • Practical impact: These appear 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) require maintenance of regular accounts and submission (and correction) of prescribed statements. This creates clear record-keeping obligations; the precise contents, form, timing and verification procedures are to be prescribed and are Not stated in the document. The requirement to furnish donor certificates (clause (g)) imposes an administrative obligation on the recipient organisation.
  • Timelines for administrative action: The Table sets finite time windows for applicants to file and for the Principal Commissioner/Commissioner to decide; applicants should plan filings to avoid missed windows, especially on expiry/renewal scenarios where advance filings (at least six months) are mandated.
  • Risk of rejection/cancellation: Sub-section (3) allows the authority to call for documents and make inquiries; if not satisfied, it may reject an application (and in some cases cancel approval). The clause provides procedural fairness by requiring a reasonable opportunity of being heard before rejection, but the operational scope of inquiries and what constitutes satisfaction is Not stated in the document.

Key Takeaways

  • Clause 354 provides a statutory route for registered non-profits or specified persons to obtain approval relevant to donations u/s 133(1)(b)(ii).
  • Seven express eligibility and compliance conditions cover non-discrimination, charitable purpose, restrictions on asset transfer, accounts, prescribed statements, correction mechanisms and donor certificates.
  • The provision sets distinct application windows, decision timeframes and validity periods (three or five tax years, depending on circumstances) in a five-row Table.
  • Clause (b) contains a strict threshold on "religious-nature" expenditure-"5% or more" of total income-which can render organisations ineligible even if expenditure equals exactly 5%.
  • The Principal Commissioner/Commissioner has inquiry powers and may approve, reject or (where applicable) cancel approvals, but must afford a reasonable opportunity of being heard before rejection.
  • Many operational details (definitions, prescribed forms, calculation rules, content of Schedules, and applicable other laws) are left to prescription or are Not stated in the document.

Full Text:

Section 354 Application for approval for purpose of section 133(1)(b)(ii).

Topics

Acts Income Tax