Just a moment...

⚠✕
❮ Top
☎ Help
☰
×

By creating an account you can:

Logo TaxTMI
>
Keyword Search :
AI Tools : New
Ask tax questions in natural language. Powered by AI trained on the TaxTMI legal database. Use AI Tools ➞
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 characters0/2000
╳
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.
RelevanceDefaultDate
    Act RulesBills
    Doctrine of Reasonable Cause in Tax Penalties : Clause 470 of the Income Tax Bill, 2025 Vs. Section ...
    Act RulesBills
    Voluntary Disclosure and Penalty Waiver under Indian Tax Law : Clause 469 of the Income Tax Bill, 20...
    Act RulesBills
    Penalties for Non-Compliance with TDCAN/TAN Requirements : Clause 468 of the Income Tax Bill, 2025 V...
    Act RulesBills
    Penalty Provision for PAN/Aadhaar Non-Compliance in Indian Tax Law : Clause 467 of the Income Tax Bi...
    Act RulesBills
    Penalty Provisions for deterrence against non-cooperation with tax authorities : Clause 466 of Incom...
    Act RulesBills
    Procedural Defaults and Penalties in Indian Tax Law : Clause 465 of the Income Tax Bill, 2025 Vs. Se...
    Act RulesBills
    Ensuring Compliance Among Tax-Exempt Entities : Clause 464 of the Income Tax Bill, 2025 Vs. Section ...
    Act RulesBills
    Professionals(i.e. Accountant, Marchant Banker, Registered Valuer) Accountability under Indian Incom...
    Act RulesBills
    Enforcement of Information Disclosure in Cross-Border Transactions : Clause 462 of the Income Tax Bi...
    Act RulesBills
    Penalty Provisions for Non-Filing and Incorrect Filing of TDS/TCS Statements : Clause 461 of the Inc...
    Act RulesBills
    Enforcement of Reporting Obligations by a non-resident having liaison office : Clause 460 of Income ...
    Act RulesBills
    Penalties for Reporting Non-Compliance by Resident constituent entity of an international group unde...
    Act RulesBills
    Legal Implications of Non-Compliance with Reporting Requirements : Clause 458 of the Income Tax Bill...
    Act RulesBills
    Strengthening Transfer Pricing Enforcement : Clause 457 of the Income Tax Bill, 2025 Vs. Section 271...
    Act RulesBills
    Compliance and Penalty Mechanisms for Investment Funds under Indian Tax Law : Clause 456 of the Inco...
    Act RulesBills
    Penalties for Inaccurate Financial Reporting under Indian Income Tax Law : Clause 455 of the Income ...
    Act RulesBills
    Penalties for Non-Compliance in Financial Transaction Reporting : Clause 454 of the Income Tax Bill,...
    Act RulesBills
    Penalty Provisions for Non-compliant Loan Repayments in India's Income Tax Law : Clause 453 of the I...
    Act RulesBills
    Mandatory Electronic Payments and Penalty Regimes : Clause 452 of the Income Tax Bill, 2025 Vs. Sect...
    Act RulesBills
    Evolving Penalty Regimes for Monetary Transaction Violations : Clause 451 of the Income Tax Bill, 20...
❮
❯
❯❯
MaximizeMaximizeMaximize
0 / 200
Expand Note
Add to Folder

No Folders have been created

    +

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

    NOTE:

    Open Link
    Notes
    Showing Results for :
    Reset Filters
    Results Found:
    Show All SummariesHide All Summaries
    Act RulesBills
    Doctrine of Reasonable Cause in Tax Penalties : Clause 470 of the Income Tax Bill, 2025 Vs. Section ...
    Show AI Summary
    Reasonable cause defense protects taxpayers from penalties for bona fide, non culpable defaults and encourages documented compliance.
    Clause 470 creates an exception to specified penalty provisions: no penalty shall be imposed if the assessee proves there was reasonable cause for the failure. It functions as a non obstante provision covering enumerated sections, shifts the burden of proof to the taxpayer, and is aimed primarily at bona fide procedural or technical lapses rather than deliberate violations.
    Act RulesBills
    Voluntary Disclosure and Penalty Waiver under Indian Tax Law : Clause 469 of the Income Tax Bill, 20...
    Show AI Summary
    Voluntary disclosure and penalty waiver enable administrative relief when pre detection disclosure, cooperation and payment conditions are met.
    Clause 469 empowers the Principal Commissioner or Commissioner to reduce or waive penalties under section 439 where a taxpayer has made a full and true voluntary disclosure before detection, cooperated in assessment and paid or arranged payment of tax or interest; it includes a deeming rule for full disclosure, prior approval safeguards for high value cases, a bar on multiple reliefs, a genuine hardship route with recorded reasons, a twelve month disposal limit, opportunity to be heard, and finality of orders.
    Act RulesBills
    Penalties for Non-Compliance with TDCAN/TAN Requirements : Clause 468 of the Income Tax Bill, 2025 V...
    Show AI Summary
    Penalty for failure to quote TDCAN/TAN: discretionary fixed sanctions apply for non compliance and knowingly false quoting.
    Clause 468 empowers the Assessing Officer to impose a fixed monetary penalty for failure to comply with Section 397 and for quoting a false Tax Deduction and Collection Account Number in prescribed documents where the person knows or believes it to be false, making the penalty discretionary and imposing a mens rea requirement for false quoting while not expressly providing for a statutory opportunity of being heard.
    Act RulesBills
    Penalty Provision for PAN/Aadhaar Non-Compliance in Indian Tax Law : Clause 467 of the Income Tax Bi...
    Show AI Summary
    PAN/Aadhaar compliance: new per-default penalty regime distinguishes intentional false quoting from strict liability omissions and extends responsible person liability.
    Clause 467 establishes a per-default penalty regime for non-compliance with section 262, differentiating intentional false PAN/Aadhaar quoting-which requires proof of knowledge or belief-from omissions treated as strict liability, and extends liability to persons responsible for ensuring correct quoting/authentication; it emphasizes authentication and digital e KYC integration while remaining silent on express procedural safeguards such as the opportunity to be heard, creating potential due process and transitional issues.
    Act RulesBills
    Penalty Provisions for deterrence against non-cooperation with tax authorities : Clause 466 of Incom...
    Show AI Summary
    Penalty for non cooperation: new provision allows senior tax officers to impose a moderate monetary penalty without explicit hearing safeguards.
    Clause 466 empowers specified senior tax officers to impose a moderate monetary penalty for failure to comply with section 254, mirroring prior penalty structure in authority and capped quantum but omitting express procedural safeguards such as an opportunity of being heard, defences like reasonable cause, and a requirement to record reasons, thereby raising concerns about procedural fairness and consistency in imposition.
    Act RulesBills
    Procedural Defaults and Penalties in Indian Tax Law : Clause 465 of the Income Tax Bill, 2025 Vs. Se...
    Show AI Summary
    Penalty for procedural defaults: fixed and daily fines, capped to tax collectible, with delegated authority to impose them.
    Clause 465 creates a penalty regime for procedural non compliance under the Income Tax Bill, 2025: a fixed penalty for discrete defaults, a daily penalty for continuing defaults, a cap tying certain penalties to the amount of tax deductible or collectible, and specified authorities empowered to impose penalties; it broadens the definition of income tax authority and updates cross references to the restructured Bill, while notably omitting an explicit provision requiring an opportunity to be heard before penalty imposition.
    Act RulesBills
    Ensuring Compliance Among Tax-Exempt Entities : Clause 464 of the Income Tax Bill, 2025 Vs. Section ...
    Show AI Summary
    Penalty regime for failure to furnish prescribed statements strengthens compliance under tax exempt reporting obligations.
    A statutory penalty regime targets failure by specified research institutions and charitable funds to furnish prescribed documents, statements, or certificates within prescribed timeframes; penalties fall within a prescribed band and are imposed at the discretion of the Assessing Officer, operating as a civil compliance measure alongside general procedural safeguards and requiring stakeholders to update compliance processes to align with re referenced substantive sections.
    Act RulesBills
    Professionals(i.e. Accountant, Marchant Banker, Registered Valuer) Accountability under Indian Incom...
    Show AI Summary
    Professional accountability: penalty for furnishing incorrect information in professional reports or certificates under the new income tax bill.
    Clause 463 imposes a strict-liability penalty regime on accountants, merchant bankers and registered valuers for furnishing incorrect information in any report or certificate under the Act or rules. It prescribes a fixed per-instance monetary penalty and empowers the Assessing Officer, Joint Commissioner (Appeals) or Commissioner (Appeals) to impose the penalty upon satisfaction that incorrect information was furnished. The clause updates definitional references for valuers, omits an explicit definition of "accountant," and operates without prejudice to other civil or criminal consequences.
    Act RulesBills
    Enforcement of Information Disclosure in Cross-Border Transactions : Clause 462 of the Income Tax Bi...
    Show AI Summary
    Penalty for failure to furnish information: fixed sanction for inaccurate or missing cross-border disclosure, raising proportionality concerns.
    Clause 462 penalises any person required to furnish information under section 397(3)(d) who fails to supply such information or furnishes inaccurate information; the Assessing Officer may impose a fixed monetary penalty, the provision mirrors Section 271I in structure and intent, lacks an express reasonable-cause defence or gradation of penalty, and raises interpretative issues as to the scope of "inaccurate information," procedural safeguards, and proportionality in enforcement.
    Act RulesBills
    Penalty Provisions for Non-Filing and Incorrect Filing of TDS/TCS Statements : Clause 461 of the Inc...
    Show AI Summary
    Penalty for failure to furnish statements: discretionary fines with short grace period where tax is paid and statement filed promptly.
    Clause 461 creates a penalty for failure to deliver statements under section 397(3)(b) or for furnishing incorrect information, authorising the Assessing Officer to impose a discretionary monetary penalty equivalent in range to the existing Section 271H. Clause 461(2) exempts penalty where tax, fee and interest are paid to the Central Government and the statement is filed within a short grace period, thereby balancing deterrence with relief for prompt substantive compliance while leaving procedural safeguards and definitions, such as "incorrect information," unclearly specified.
    Act RulesBills
    Enforcement of Reporting Obligations by a non-resident having liaison office : Clause 460 of Income ...
    Show AI Summary
    Penalty for failure to submit statements may be imposed by the assessing officer as a daily or capped sanction, discretion preserved.
    Clause 460 permits the Assessing Officer to impose discretionary monetary penalties on any person required to furnish a statement under section 505 for failure to file within the prescribed period, using a two-tier structure of a daily sanction for short-term delay and a capped penalty for longer default, with applicability dependent on the scope of the parent reporting obligation and subject to the general procedural and appellate framework of the tax law.
    Act RulesBills
    Penalties for Reporting Non-Compliance by Resident constituent entity of an international group unde...
    Show AI Summary
    Reporting penalties: new clause preserves escalating daily fines and a large fixed penalty for inaccurate international tax reports.
    Clause 459 establishes a tiered penalty regime under section 511 for reporting entities: daily penalties for failure to furnish reports, daily penalties for failure to produce information after the allowed period, an escalated daily penalty if default continues after service of a penalty order, and a substantial fixed penalty for furnishing inaccurate information or failing to correct known or discovered inaccuracies. The prescribed authority under section 511 is empowered to impose these penalties, and the clause mirrors Section 271GB in quantum and triggers while raising issues about reasonable cause relief and procedural safeguards.
    Act RulesBills
    Legal Implications of Non-Compliance with Reporting Requirements : Clause 458 of the Income Tax Bill...
    Show AI Summary
    Penalty for failure to report transfers of management or control triggers significant compliance and enforcement consequences.
    Clause 458 creates a penalty for failure by an Indian concern to furnish information or documents under section 506, authorising the prescribed income-tax authority to impose either a transaction-value-based penalty where a transaction effects a direct or indirect transfer of management or control, or a fixed monetary penalty otherwise, and otherwise mirrors the substantive framework and enforcement objectives of Section 271GA of the Income-tax Act, 1961.
    Act RulesBills
    Strengthening Transfer Pricing Enforcement : Clause 457 of the Income Tax Bill, 2025 Vs. Section 271...
    Show AI Summary
    Transfer pricing documentation penalty: failure to furnish documents leads to transaction value based penalties and enforcement by tax authorities.
    Failure to furnish prescribed transfer pricing information or documentation for international or specified domestic transactions triggers a transaction value based penalty under Clause 457, enforceable by the Assessing Officer, authorised Transfer Pricing Officer and the Commissioner (Appeals); the clause ties this enforcement directly to the obligations in section 171(2) and raises interpretive issues concerning the meaning of failure, computation of transaction value, overlap with other penalties, and the availability of a reasonable cause defence.
    Act RulesBills
    Compliance and Penalty Mechanisms for Investment Funds under Indian Tax Law : Clause 456 of the Inco...
    Show AI Summary
    Penalty for failure to furnish statements: eligible investment funds face a fixed sanction under the bill; authority may impose it.
    Clause 456 imposes a fixed penalty where an eligible investment fund fails to furnish required statements or information within the prescribed time; the prescribed income-tax authority may direct payment of the fixed sanction. The reporting deadline is set by the substantive eligibility reporting provision; the penalty is discretionary rather than automatic, lacks a graded scale, and does not expressly specify procedural safeguards such as criteria for discretion or an opportunity to be heard.
    Act RulesBills
    Penalties for Inaccurate Financial Reporting under Indian Income Tax Law : Clause 455 of the Income ...
    Show AI Summary
    Penalty for inaccurate financial reporting imposes institutional and account-holder liability while enabling recovery of penalties from account holders.
    Clause 455 mandates penalties for persons required to furnish statements of financial transactions or reportable accounts for providing inaccurate information or failing to meet due diligence obligations, and imposes an additional per-account penalty on reporting financial institutions where inaccuracies stem from account-holder-supplied false information; reporting institutions may recover such additional penalties from the responsible account holders by direct recovery or retention of funds, with imposition directed by the prescribed income-tax authority and substantive continuity with the former Section 271FAA.
    Act RulesBills
    Penalties for Non-Compliance in Financial Transaction Reporting : Clause 454 of the Income Tax Bill,...
    Show AI Summary
    Penalty for failure to furnish financial transaction statements - escalating daily sanctions for continued non-compliance after notice.
    Clause 454 creates a statutory penalty regime for failure to furnish a statement of financial transaction or reportable account, prescribing a daily penalty accruing from the date the filing deadline lapses, with an escalated daily rate where default continues after a formal notice, and vesting discretionary imposition authority in the income-tax authority subject to procedural safeguards and rights to challenge.
    Act RulesBills
    Penalty Provisions for Non-compliant Loan Repayments in India's Income Tax Law : Clause 453 of the I...
    Show AI Summary
    Penalty for non-compliant loan repayments: Assessing Officer may impose a penalty equal to the amount repaid for procedural breaches.
    Clause 453 permits the Assessing Officer to impose a penalty equal to any loan, deposit or specified advance repaid in contravention of section 188, applying to all persons and covering repayments made by non-transparent modes. The provision creates strict liability based on procedural breach rather than mens rea, centralizes enforcement with the Assessing Officer, and omits an explicit reasonable-cause defence, raising potential interpretative and transitional issues regarding the scope of specified advances and procedural safeguards.
    Act RulesBills
    Mandatory Electronic Payments and Penalty Regimes : Clause 452 of the Income Tax Bill, 2025 Vs. Sect...
    Show AI Summary
    Electronic payment mandate triggers daily penalties for non compliance unless a taxpayer proves good and sufficient reason.
    Clause 452 empowers the Assessing Officer to impose a fixed per day monetary penalty for failure to provide prescribed electronic modes of payment under section 187, subject to a saving where the person proves good and sufficient reason for the failure; the provision mirrors the former section 271DB framework but streamlines authority and lacks detailed procedural guidance.
    Act RulesBills
    Evolving Penalty Regimes for Monetary Transaction Violations : Clause 451 of the Income Tax Bill, 20...
    Show AI Summary
    Monetary transaction penalty: discretion to impose a penalty equal to prohibited receipt unless good and sufficient reasons are proved.
    Clause 451 empowers the Assessing Officer to impose a penalty equal to the sum received in contravention of section 186 unless the recipient proves good and sufficient reasons; the provision emphasises proportionality, vests discretion in enforcement, omits explicit procedural safeguards and mens rea, and mirrors the substantive penalty quantum and defence in the earlier statutory regime while differing in statutory tone and procedural concision.

    TMI Notes

    Back

    All TMI Notes

    Showing Results for :
    Reset Filters
      No Records Found

      TMI Notes

      Home› TMI Notes › Income Tax › Act-Rules › Category › This
      Back

      All TMI Notes

      whatsappJoin Channel
      Showing Results for : Reset Filters
      Income Tax

      Comparison of SCHEDULE XVI "PERMITTED MODES OF INVESTMENT OR DEPOSITS" between the Income-Tax Act, 2025 (as passed) and the Income-Tax Bill, 2025 (as originally introduced)

      18 September, 2025

      Contents
      Acts
      Rules & Regulations
      Summary
      Note

      Note

      -

      Bookmark

      Print

      Print

      Print Options

      SCHEDULE XVI - PERMITTED MODES OF INVESTMENT OR DEPOSITS

      Income-tax Act, 2025

      At a Glance

      The provided documents are two versions of SCHEDULE-XVI (Permitted Modes of Investment or Deposits) related to section 350 of the Income-tax legislation as presented in (a) "SCHEDULE-XVI of Income-tax Act, 2025" (Document 1) and (b) "SCHEDULE-XVI of Income Tax Bill, 2025 - Old Version" (Document 2). Both list permissible investment/deposit modes for registered non-profit / charitable or religious trusts or institutions. The differences between the two texts are principally editorial and ordering/wording differences and a few numbering/clauses variations; they do not indicate new substantive modes in the Old Version beyond those in the Act version provided. Affected parties: charitable/religious trusts, registered non-profit organisations, tax administrators and financial intermediaries. Effective date or decision date: Not stated in the document.

      Background & Scope

      Statutory hooks: See section 350 (referenced) and the schedule title SCHEDULE XVI. The schedule specifies the "modes of investing or depositing the money referred to in section 350" and therefore regulates the forms in which corpus or funds of charitable/religious trusts and institutions (or registered non-profit organisations) may be maintained to retain tax benefits or compliance with section 350. The schedule enumerates specific permitted instruments, investments, deposits and certain transitional and historical exceptions. Definitions are provided within the schedule (see paragraph providing definitions such as "long-term finance", "public company", "urban infrastructure", "Immovable property", "incubatee", "incubator").

      Statutory Provision Mode

      Text & Scope

      The schedule enumerates discrete permitted modes of investment/deposit for monies u/s 350. Coverage: central government small savings instruments (savings certificates, small savings schemes), Post Office Savings Bank, scheduled banks and cooperative banks, Unit Trust of India units, securities issued by Central/State Governments, government-guaranteed debentures, investments/deposits with public sector companies (with transitional deeming rules if company ceases to be a public sector company), bonds issued by specified financial corporations or public companies engaged in long-term housing/urban infrastructure finance, immovable property, IDBI deposits, units of specified mutual funds (Schedule VII entries), transfers to Public Account of India, deposits with housing/urban development authorities, equity shares of depositories, specified investments by recognised stock exchanges, investments by payment system entities in specified companies, incubator/incubatee investments, shares of National Skill Development Corporation, debt instruments of RBI-registered infrastructure finance companies, Sovereign Gold Bonds ("Stock Certificate" definition reference), units of Powergrid Infrastructure Investment Trust, shares in a public sector company, historical corpus exceptions (assets forming corpus as at specified historical dates), accretions by bonus shares, debentures acquired before specified historical dates, voluntary contributions maintained as specified tangible assets, short-term holding exception for non-specified assets, and funds representing business profits under specified conditions.

      Interpretation

      The schedule is primarily a closed list of permissible forms; interpretive principle implied: only these listed forms (and those falling within the enumerated transitional/historical carve-outs) qualify as compliant with section 350 requirements. The definitions provided constrain certain terms (for example, "long-term finance" defined by a five-year minimum repayment term, "Immovable property" excluding most machinery/plant). Legislative intent as indicated by the text: to allow a mix of conservative, government-backed, regulated financial instruments and specified sectoral investments while controlling diversion into unregulated assets; to preserve historical corpus exceptions; and to permit certain strategic sectoral investments (e.g., incubators, digital payments infrastructure, infrastructure finance).

      Exceptions/Provisos

      The schedule includes multiple temporal and condition-based exceptions: (a) investments in public sector company shares remain covered for three years after the company ceases to be a public sector company; (b) other deposit/investment in such company remains covered until repayable; (c) assets not specified in clauses (1)-(30) are permitted only if not held beyond one year from the end of the tax year in which acquired (Document 1 wording differs slightly-see differences table); (d) corpus preservation exceptions for assets held on 1 June 1973 and 1 June 1998; (e) certain assets acquired before 1 March 1983; (f) business profits may be retained only if separate books are maintained where other income exists.

      Illustrations

      • Example 1: A registered non-profit purchases Central Government savings certificates and deposits surplus funds in a scheduled bank: these are permitted under clauses (1) and (3).
      • Example 2: A trust acquires equity shares of a public sector company that later becomes disinvested and ceases to qualify as a public sector company; the trust's shareholding is deemed to remain a permitted investment for three years from the date of change (clause (7)(a)).
      • Example 3: A charitable institution receives a painting as a voluntary contribution and maintains it as part of corpus pending a Board notification: clause (30)/(32) allows voluntary contributions maintained in forms such as furniture or jewellery if specified by Board notification. (Note: reliance on Board notification is required.)

      Interplay

      The schedule cross-references: Government Savings Certificates Act, 1959; Depositories Act, 1996; Securities Contracts (Regulation) Act, 1956; Securities and Exchange Board of India Act, 1992; Payment and Settlement Systems Act, 2007; Companies Act, 2013; Industrial Development Bank of India Act, 1964; Schedule VII (mutual fund schemes); Sovereign Gold Bonds Scheme notification G.S.R. 827(E) dated 30 October 2015; and section 32(e) (as corrected). Interaction with these statutes and notifications determines eligibility/qualification of instruments and entities named. Specific practical interpretive issues: Not stated in the document (e.g., guidance on valuation, treatment of hybrid instruments, or applicable timelines for Board notifications).

      Differences between Document 1 (Schedule-XVI of Income-tax Act, 2025) and Document 2 (Schedule-XVI of Income Tax Bill, 2025 - Old Version)

      FeatureDocument 1 (Act)Document 2 (Bill - Old)Practical Impact
      Title/Scope descriptionReads "FORMS OR MODES OF INVESTMENT OR DEPOSITS BY A REGISTERED NON PROFIT ORGANISATION".Reads "FORMS OR MODES OF INVESTMENT OR DEPOSITS BY A CHARITABLE OR RELIGIOUS TRUST OR INSTITUTION".Potential drafting consistency/coverage difference: Act version uses broader term "registered non profit organisation" while Bill refers to "charitable or religious trust or institution". Practical effect depends on statutory definition of "registered non profit organisation" vs. "charitable or religious trust or institution" elsewhere - Not stated in the document.
      Numbering and orderingLists items (1)-(32) with definitions at paragraph 2 (a)-(f).Lists items (1)-(32) then includes clause (33) as the definitions block; textual wording slightly varies (e.g., references to "herein referred to" vs "hereafter referred to").Primarily editorial; no substantive change to listed permissible modes is apparent. Practical impact: negligible on permitted modes; clarity/interpretation possibly affected by drafting differences but core content substantially same.
      Specific clause differences (examples)Includes item (30) "voluntary contributions received and maintained in the form of jewellery, furniture or any other article as the Board may, by notification specify" as clause (30) and item (31) concerning assets not in clauses (1)-(30) held up to one year from end of tax year.Order differs: item (32) in Document 2 is the "voluntary contributions..." clause and item (30) in Document 2 refers to assets not being investments held after expiry of one year from end of tax year. Also Document 2 contains minor textual corrections (notes indicating correction of "section 32 (1)(e)" to "section 32 (e)").These are drafting/numbering and editorial corrections. Practical impact: none substantive, but numbering differences require caution when citing specific sub-paragraph numbers; reference to section 32(e) correction clarifies intended cross-reference.
      Definitions block placement and labellingDefinitions under "2. Interpretation" enumerated (a)-(f).Definitions included at the end as "(33) In this schedule,- (a) ... (f) ..." with slightly different heading style.No substantive difference in definitions themselves. Practical impact limited to citation conventions within drafting-users must ensure referencing correct clause numbering for each version.
      Minor wording variantsUses phrasing such as "herein referred to as investor" and "herein referred to as investee".Uses "hereafter referred to as investor" and "hereafter referred to as investee"; contains textual spacing and punctuation variations and an explicit errata note about corrections.Editorial only. Practical impact: none on legal substance, but the errata notes in Document 2 improve textual accuracy.

      Practical Implications

      • Compliance and risk areas: Trustees and non-profit administrators must ensure corpus monies are invested only in the enumerated modes or within the short-term holding exception; reliance on non-specified investments beyond the one-year grace risks non-compliance with section 350 conditions. Not stated in the document: procedural sanctions or consequences for non-compliance.
      • Record-keeping/evidence: The text implies need for records evidencing nature of instruments (e.g., government certificates, bank deposits, share certificates, notifications of permitted Board-specified tangible assets), dates of acquisition to apply short-term holding rule and historical corpus cut-off dates, and documentation of separate books of accounts where business profits and other income co-exist.

      Key Takeaways

      • SCHEDULE-XVI provides a closed/enumerated list of permitted investment/deposit modes for monies u/s 350, privileging government-backed and regulated instruments and certain sectoral investments.
      • Both documents substantially list the same modes; differences are largely editorial, numbering and minor wording variations, and a title wording variance (registered non-profit organisation vs. charitable or religious trust/institution).
      • Transitional exceptions (public sector company treatment, historical corpus dates, pre-1983 debentures) preserve earlier holdings and prevent retrospective disallowance of legacy corpus assets.
      • Short-term holding exception permits non-specified assets to be held only up to one year from the end of the tax year in which acquired (wording differs slightly between versions; practitioners should confirm the authoritative version before citation).
      • Definitions such as "long-term finance" (five-year minimum) and "Immovable property" (excluding most machinery/plant) narrow the scope of qualifying instruments.
      • Practical compliance requires careful record-keeping, attention to cross-references (e.g., section 32(e), statutory definitions), and monitoring of statutory/Board notifications referenced for certain asset categories.
      • Errata in the Bill (corrections from "section 32(1)(e)" to "section 32(e)") and minor drafting differences mean practitioners should use the enacted/official Gazette text for authoritative citation.

      Full Text:

      SCHEDULE XVI - PERMITTED MODES OF INVESTMENT OR DEPOSITS

      Topics

      ActsIncome Tax
      Next ➔