{"id":7491,"date":"2020-04-28T10:20:48","date_gmt":"2020-04-28T04:50:48","guid":{"rendered":"https:\/\/corpbiz.io\/learning\/?p=7491"},"modified":"2020-04-28T10:37:54","modified_gmt":"2020-04-28T05:07:54","slug":"restrictions-on-the-charitable-trust","status":"publish","type":"post","link":"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/","title":{"rendered":"Know all the Restrictions on the Charitable Trust"},"content":{"rendered":"\n<p class=\"has-drop-cap\">This\nblog will focus on some common issues that every litigant should be responsive\nto draft the provisions of a Deed. At all the time, lawyers must take the\nvision to modify the restricted charitable Trust to fit the factual setting and\nneeds as per the specific donor, or charitable donor as the case may be.&nbsp; <\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title ez-toc-toggle\" style=\"cursor:pointer\">Page Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_are_Restricted_Gifts\" >What are Restricted Gifts?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_are_the_restrictions_on_charitable_purposes\" >What are the restrictions on\ncharitable purposes?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_do_you_mean_by_Restriction_on_Sufficient_Wordings\" >What do you mean by Restriction\non Sufficient Wordings?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_do_you_mean_by_a_restriction_on_Political_Purposes\" >What do you mean by a\nrestriction on Political Purposes?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_do_you_mean_by_Restricted_Charitable_Gift\" >What do you mean by Restricted\nCharitable Gift?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_do_you_mean_by_Restrictions_on_Conditional_Gifts\" >What do you mean by Restrictions\non Conditional Gifts?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#Procedural_Restriction_%E2%80%93_Do_you_know_that_Corpus_donations_should_not_get_reflected_as_an_application_of_income_in_the_event_of_Charitable_Trust\" >Procedural Restriction &#8211; Do you know that Corpus donations should not get reflected as an application of income in the event of Charitable Trust?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_about_the_Modifications_in_object_clause_cited_at_the_time_of_registration_of_charitable_Trust\" >What about the Modifications in\nobject clause cited at the time of registration of charitable Trust?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_about_Amended_Returns_of_Income_as_per_Section_1394A\" >What about Amended&nbsp;Returns\nof Income as per Section 139(4A)?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_about_getting_property_by_any_person_without_consideration_us_562_X\" >What about getting property by\nany person without consideration u\/s 56(2) (X)?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_are_the_exceptions_to_the_newly_inserted_clause_x_are_in_section_56_contrary_to_property_received_without_consideration\" >What are the exceptions to the\nnewly inserted clause (x) are in section 56 contrary to property received\nwithout consideration?&nbsp;<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_is_the_Restriction_on_Cash_Donations_us_80G\" >What is the Restriction on Cash\nDonations u\/s 80G?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#What_are_the_restrictions_deliberated_by_the_Supreme_Court_of_India_on_the_property_of_transfers_under_Trust\" >What are the restrictions\ndeliberated by the Supreme Court of India on the property of transfers under\nTrust?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#A_Detailed_Study_on_Donations_for_Charitable_Trust_and_its_Restrictions\" >A Detailed Study on Donations\nfor Charitable Trust and its Restrictions<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/corpbiz.io\/learning\/restrictions-on-the-charitable-trust\/#Conclusion\" >Conclusion<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_Restricted_Gifts\"><\/span>What are Restricted Gifts?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li>If a charitable trust accepts a gift subjected to a restricted charitable\ntrust, in those cases, the charity gets legally bound by those limits and\nrestrictions. Whether the Trust understands it or not, receiving these kinds of\ngifts, tends to establish a particular purpose for charitable Trust and\ntrustee. It will get subjected to the legal regime governing such charitable\ntrusts.&nbsp;<\/li><li>Some general types of restricted charitable trusts comprise endowments,\nlong term funds, scholarship funds, building funds, as well as donor instructed\nfunds that often get placed with community foundations.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_restrictions_on_charitable_purposes\"><\/span>What are the restrictions on\ncharitable purposes?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Moreover,\nthere are also some restrictions on the use of charitable trusts. Such as,\nthese Trust must be devoted entirely and exclusively to the charitable purposes\nof the Trust. Likewise, if it is not seen in such a way, the trustee would have\nthe discretion to use the funds for either charitable or non-charitable (i.e.,\ninvalid) objectives. It will lead the Trust to be Void.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_do_you_mean_by_Restriction_on_Sufficient_Wordings\"><\/span>What do you mean by Restriction\non Sufficient Wordings?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li>There are cases where addresses, whether a trust is devoted exclusively to charitable purposes, focus on the wording of the Trust or not. It is because the courts have interpreted terms such as objects of liberality, benevolent objects, and charitable purpose as not referring exclusively to &#8220;charitable purposes&#8221;.\u00a0<\/li><li>In every case, the court will search for the stated well as the expressed intention of the creator of Trust. Concerning the above, drafter of charitable purpose trusts has a responsibility to certify that the wording of the Trust is sufficient to support the verdict of a charitable purpose trust.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_do_you_mean_by_a_restriction_on_Political_Purposes\"><\/span>What do you mean by a\nrestriction on Political Purposes?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Besides,\ntrusts for political purposes are invalid even if it is otherwise for\ncharitable purposes. &#8220;Political purposes&#8221; does not mean merely direct\npolitical party movements; it also takes account of the promotions of political\nideas and any efforts to influence the legislative or executive\nprocedures.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_do_you_mean_by_Restricted_Charitable_Gift\"><\/span>What do you mean by Restricted\nCharitable Gift?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li>A restricted charitable gift usually means a gift to a charitable purpose\nthat is questionable and subjected to restrictions, limitations, conditions,\nand terms of reference, directions, or other restricting factors of the Trust.\nThese limitations are compulsorily imposed by the donor and serve to constrain\nor limit a charity relating to how the gift can get handed off. Therefore, the\nunrestricted charitable gifts are constructively owned by a charitable trust\nfor its general charitable purposes.<\/li><li>By and large, restrictions normally found in deeds covering restricted\ncharitable purpose trusts, which tend to be religious and fall into one of\nthree classifications. Those are:- Restrictions on religious doctrine, i.e.,\nrequiring that the property be used only for individuals who subscribe to a\nparticular religious doctrine; Restrictions of use, i.e., limiting the property\nto a particular use, such as use for a church, cemetery or seminary.\nRestrictions on limiting the use of the property will apply to those who follow\nspecific religious practices similar to requiring that the property be utilized\nonly by members of a church who obey to the practice of &#8220;strict\nunion.&#8221;<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_do_you_mean_by_Restrictions_on_Conditional_Gifts\"><\/span>What do you mean by Restrictions\non Conditional Gifts?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li>A conditional gift includes the charity becoming beneficial to the owner of the gift, whichever after the condition has fulfilled or until a condition subsequent fails or occurs, as the case may be. Part of the discrepancy relates ownership gift and the other part of the wording, which is corresponding to the gift.<\/li><li>In a charitable trust, the charity never turns out to be the beneficial owner of the gift. In its place, the charity holds title to the gift in Trust, subject to specific terms and restrictions. It is likely for a conditional gift to be a restricted charitable trust only if the gift includes both a condition precedent and a donor obligation that the gift gets used for a purpose.<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Procedural_Restriction_%E2%80%93_Do_you_know_that_Corpus_donations_should_not_get_reflected_as_an_application_of_income_in_the_event_of_Charitable_Trust\"><\/span>Procedural Restriction &#8211; Do you know that Corpus donations should not get reflected as an application of income in the event of Charitable Trust?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Any donations by a charitable or religious trust or any organization to any other <a href=\"https:\/\/corpbiz.io\/trust-registration\"><strong>trust registered<\/strong><\/a> u\/s 12AA, which forms part of the corpus of recipient trust\/institution, shall not be reflected as application of income u\/s 11 for the donor trust\/institution. It says explicitly that corpus donations shall not get measured as an application of income to be reflected.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_about_the_Modifications_in_object_clause_cited_at_the_time_of_registration_of_charitable_Trust\"><\/span>What about the Modifications in\nobject clause cited at the time of registration of charitable Trust?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>It means\nthat objects of a trust or an institution have granted registration.\nSubsequently, it has adopted or undertaken modifications of the objects which\ndo not conform to the conditions of registration. Those shall be required to\nobtain a new certification by producing an application within thirty days from\nthe date of such adoption or modifications of the objects in the prescribed\nform and procedural method.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_about_Amended_Returns_of_Income_as_per_Section_1394A\"><\/span>What about Amended&nbsp;Returns\nof Income as per Section 139(4A)?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Section 12A has recently got amended to provide for a further condition that the person in receipt of income chargeable to income-tax shall furnish the return of income as per the prescribed time given details under <strong><em>section <\/em><\/strong><em>1<strong>39(4A) of the Income Tax Act<\/strong><\/em><sup><a href=\"https:\/\/www.incometaxindia.gov.in\/Pages\/i-am\/trust.aspx?k=Return%20Filing\"><strong>[1]<\/strong><\/a><\/sup>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_about_getting_property_by_any_person_without_consideration_us_562_X\"><\/span>What about getting property by\nany person without consideration u\/s 56(2) (X)?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li>Intending to avoid the practice of Charitable or Private Trusts of receiving money or property for\u00a0insufficient consideration, the Finance Act 2017 introduced clause (x) under section 56(2). After the addition of this section, money or property obtained\u00a0by any person for inadequate consideration\u00a0exceeding Rs. Fifty thousand shall be accountable to income-tax under the beam of &#8220;Income from other sources-not for Purpose&#8221; in the hands of the beneficiary.<\/li><li>Subsequently, now if any property gets acknowledged by the charitable or Private Trust for &#8220;inadequate consideration&#8221; exceeding of Rs. 50,000, then it will be chargeable to income-tax under the head &#8220;Income from other sources- not for Purpose&#8221; under\u00a0section 56(2)(x)\u00a0of The Finance Act 2017 in the hands of the beneficiary of the Trust.<\/li><\/ul>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/registration-aspect-of-educational-trust\/\">Guide: Registration Aspect of Educational Trust\n<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_exceptions_to_the_newly_inserted_clause_x_are_in_section_56_contrary_to_property_received_without_consideration\"><\/span>What are the exceptions to the\nnewly inserted clause (x) are in section 56 contrary to property received\nwithout consideration?&nbsp;<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li>Property received without consideration\u00a0from any fund, foundation, college, or other educational institution, hospital, or other medical institution or any trust mentioned to in clause (23C) of section 10 of Income Tax Act.<\/li><li>Property received without consideration from or by any trust registered under section 12A or section 12AA of Income Tax Act.<\/li><li>Property received without consideration\u00a0by any fund or Trust or institution, any university or other educational institution, any hospital or other medical institution. It is mentioned to in sub-clause (iv), sub-clause (v), sub-clause (vi), sub-clause (via) of clause (23C) of section 10 of Income Tax Act.<\/li><li>Property received without consideration\u00a0from an individual by a trust created or recognized solely for the assistance of family members or relatives of the individual.<\/li><\/ul>\n\n\n\n<p>Therefore, it is essential to note that the above-discussed trusts and institutions are out of the domain of Section 56(2) (x) of Finance act 2017. The trusts registered u\/s 12A and other institutions registered under section 10(23C) are barred from this clause so that Donations received by these Charitable trusts are not get taxed.\u00a0<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_is_the_Restriction_on_Cash_Donations_us_80G\"><\/span>What is the Restriction on Cash\nDonations u\/s 80G?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The Finance Act 2017 has amended section 80G. Therefore to provide that no deduction shall be allowed under section 80G concerning the donations of any sum exceeding Rs. 2,000\/-, until and unless such amount gets paid by any mode other than cash. Previously this limit was Rs. Ten Thousand, but now the Government has taken this step only to be responsible for the cashless economy and transparency of the economy of the nation.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_are_the_restrictions_deliberated_by_the_Supreme_Court_of_India_on_the_property_of_transfers_under_Trust\"><\/span>What are the restrictions\ndeliberated by the Supreme Court of India on the property of transfers under\nTrust?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul><li><strong>Authorities to Consider<\/strong><\/li><\/ul>\n\n\n\n<p>In the case of &#8220;Venugopala Naidu &amp; Ors v Venkatarayulu Naidu Charities &amp; Ors,&#8221;\u00a0it has been deliberated that trustees and courts are the only authorities who should reflect upon the market value of any Property of Trust.<\/p>\n\n\n\n<ul><li><strong>No Private\nNegotiations<\/strong><strong><\/strong><\/li><\/ul>\n\n\n\n<p>Any private intimations and\nnegotiations that are not noticeable to the public eye should not be accepted\nunless there are particular grounds or authoritative supports given to\nsubstantiate them.<\/p>\n\n\n\n<ul><li><strong>Limitations\nto Public Auction<\/strong><strong><\/strong><\/li><\/ul>\n\n\n\n<p>The Supreme Court held and opined in the case of &#8220;Committee of Management of Pachaiyappa&#8217;s Trust v Official Trustee of Madras &amp; Anor,&#8221;\u00a0that any conduct relating to the lease of a trust property will get hold only by the orders of a high court judge. Moreover, it must be done by public auction altogether.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"A_Detailed_Study_on_Donations_for_Charitable_Trust_and_its_Restrictions\"><\/span>A Detailed Study on Donations\nfor Charitable Trust and its Restrictions<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<h3 class=\"wp-block-heading\">What are the types of Donation?&nbsp;<\/h3>\n\n\n\n<p>Opposing to an ordinary person or\norganization, a charitable or religious institution gets a significant source\nof receipts in terms of donations. These donations may be made voluntarily of\nas the corpus. The Income Tax Law of India delivers a blanket of exemptions to\ncorpus contributions. On the contrary, it requires the application of voluntary\ndonations for charitable or religious purposes generally. These donations can\nalso get branched into &#8216;anonymous&#8217;\nand &#8216;non-anonymous&#8217;&nbsp;form.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">What about the Chargeability of\nIncome under the Income Tax Act for Anonymous Donation?<\/h3>\n\n\n\n<p>The Chargeability of Income under\nIncome Tax Act for Anonymous Donation enclosed under the provisions of <strong><em>section\n115BBC of the Income Tax Act 1961<\/em><\/strong>. The situation draws its tax\nliability at the rate of 30% depending on the present status of Trust\n-charitable or religious. Therefore, if a trust is a religious trust, it should\nnot pay tax complying with the above section 115BBC. On the contrary, if it is\na charitable trust with anonymous donations are taxable at the rate of 30%,\nwhich gets subjected to specific limited exemption.&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">What about the Chargeability of\nIncome under the Income Tax Act for Non-Anonymous Donation?<\/h3>\n\n\n\n<ul><li>The Chargeability of Income under Income Tax Act for Non- Anonymous Donation received by a trust can be claimed exemption subjected to the provisions of sections 11 &amp; 12 of the Income Tax Act 1961. As a result, a trust may accumulate 15% of Non- Anonymous Donation and required to apply an outstanding 85% donation for public charitable or any religious purposes.\u00a0<\/li><li>Furthermore, the law also provides an exemption from taxes if the state of affairs of Trust specified for deemed application or accumulation of donations is duly satisfied. Moreover, those anonymous donations received by religious Trust not taxable as per      section 115BBC get operated and distributed at the level of non-anonymous donations for taxation of religious trusts\/Institutions.<\/li><\/ul>\n\n\n\n<h3 class=\"wp-block-heading\">Whether all the Cash donations\nare anonymous?<\/h3>\n\n\n\n<p>Even if the donor&#8217;s identity is\navailable and can be disclosed, if required- such Donation can get received in\ncash, and it cannot get called as anonymous Donation. For that reason,\nconsidering cash donations as anonymous is not a legally correct proposition.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">What about the Cash Donations\nafter the Inclusion of section 269ST by the Finance Act 2017?<\/h3>\n\n\n\n<ul><li>The Finance Act 2017 has presented a new provision of section 269ST in the Income Tax Act 1961. It plays a vital role in restricting a person who is receiving Rs. 2 lakh or more in cash from a Contributor in aggregate in a day. It also applies in respect to a single transaction or which may relate to one occasion from a Contributor. The infringement of such provisions may attract penalties under the section of 271DA. The amount will be the same as the amount so received by the Beneficiary of the Trust.<\/li><li>For that reason, if the donations found received in violation of section 269ST, then the charitable Trust shall be accountable and liable to attract penal consequences. For instance, if a charitable Religious Temple trust, being paid cash amount of Rs. 3,50,000 by a donor only for &#8216;Conduct for Pratishta&#8217; or &#8216;Prasad&#8217; or &#8216;Pooja-Archana&#8217; program, it will be said as non-compliant for section 269ST.\u00a0<\/li><\/ul>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>It gets examined that the intent\nof the Government seems to implement a conduct for an efficient governance tool\nin public charitable institutions, and to exercise greater scrutiny. As a\nresult, it can avoid any misapplication of the favorable legal provisions\ndescribed above laws to such institutions, which is noble by nature. <\/p>\n\n\n\n<p>Moreover, the amendment expects tax authorities to have professional as well as expert knowledge in all the applicable laws to be in force. At this moment, we at <a href=\"https:\/\/corpbiz.io\/\"><strong>Corpbiz<\/strong><\/a> have experienced legal professionals to help you with the process of Property distribution in compliance with all the recent amendments and expectations to be fulfilled. Our professional will ensure to mitigate all your ventures successfully as well as timely completion of your work.<\/p>\n\n\n\n<p class=\"text-left\"><b>Read our article<\/b>:<mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/corpbiz.io\/learning\/annual-compliance-of-a-public-limited-company\/\">Guide: Analysis of Property held by Trust or by name\n<\/a><\/mark><\/p>\n","protected":false},"excerpt":{"rendered":"<p>This blog will focus on some common issues that every litigant should be responsive to draft the provisions of a Deed. At all the time, lawyers must take the vision to modify the restricted charitable Trust to fit the factual setting and needs as per the specific donor, or charitable donor as the case may [&hellip;]<\/p>\n","protected":false},"author":20,"featured_media":7494,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[324],"tags":[528],"acf":{"service_id":"10"},"authorName":"Archita Bhattacharjee","authorImageUrl":"https:\/\/corpbiz.io\/learning\/wp-content\/uploads\/2020\/03\/WhatsApp-Image-2020-03-18-at-11.26.19-AM-1.jpeg","authorDescription":"Archita Bhattacharjee is working as Legal Analyst (Team Lead, Research &amp; Development) at Corpbiz and has proving experience about 2 years as Corporate Legal Researcher in law firms as well as Rajya Sabha and authors in diverse publications. She has refined her skills by representing India in Paris, France and the University of Leiden over implications of International Humanitarian and Criminal Law being certified member of many Legal Centers.","postViews":17989,"readingTime":8,"_links":{"self":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/7491"}],"collection":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/users\/20"}],"replies":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/comments?post=7491"}],"version-history":[{"count":22,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/7491\/revisions"}],"predecessor-version":[{"id":7514,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/posts\/7491\/revisions\/7514"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media\/7494"}],"wp:attachment":[{"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/media?parent=7491"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/categories?post=7491"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/corpbiz.io\/learning\/wp-json\/wp\/v2\/tags?post=7491"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}