A Brief about Form 10A and 10AB as per new Law on Registration of trust under Section 12A and Section 80G and Approval U/s 10(23C) and Section 35(1)

The Finance Act, 2020 has made changes leading to complete overhaul in the registration process of charitable and religious organisations. The procedure for registration of every organisation under the new scheme shall be completely electronic under a centralised database.

The Income-tax Department shall issue a National Unique Registration Number to all the charitable and religious institutions and thereby creating a National Database of exempt entities.

A new section 12AB has been inserted with effect from 1st April, 2021 dealing with the procedure of registration. Earlier, trusts or institutions were registered under section 12AA or under section 12A.

Further provision of Section 10(23C) and 35 has also been amended. These amendments were originally introduced by the Finance Act, 2020 effective from 1St June 2020, However, due to unprecedented economic crisis, the government passed “The Taxation and Other Laws (Relaxation And Amendment Of Certain Provisions) Act, 2020” as on 29th September 2020 to defer the implementation of new procedure and make it effective from 1st April 2021.

Further the rules relating to the provisions has also been amended by Income Tax Notification 26th March 2021.

From 10A and 10AB has been prescribed in these new rules for the registration of the Trust U/s 12A & 80G and approval U/s 10(23C) sub-clause (iv) or (v) or (vi) or (via) & 35(1) sub-clause. As per New law Form 10A or 10AB is required to be filed for re-registration/ fresh registration or approval as the case may be. Let’s find out who require to fill Form 10A and 10AB?

From-10A:

Who are required to fill Form-10A?

1. Trust/Institute already registered under the previous law effective immediately before this amendment (i.e., before 1st April 2021)

  • Fund or trust or institution or any university or other educational institution or any hospital or other medical institution referred to in sub-clause (iv) or (v) or (vi) or (via) of section 10(23C) approved under the first proviso
  • Trust/Institute registered under section 12A or 12AA
  • Institution/fund approved under the clause (vi) of section 80G(5)
  • research association, university, college or other institution referred to in clause (ii) or clause (iii) or the company referred to in clause (iia) of section 35(1)

Time limit: The time limit of 3months from the date on which the provision came into force. i.e., 30th June 2021 is the time limit for application as the effective date is 1st April 2021

2. Trust/institute not registered under the previous law and want to make an application for fresh Registration or Approval under the new law or any other case then it required to file Form

  • Fund or trust or institution or any university or other educational institution or any hospital or other medical institution referred to in sub-clause (iv) or (v) or (vi) or (via) of section 10(23C) approved under the first proviso clause (iv)
  • Trust/ Institute – [ sub clause(vi) Clause (ac) of section 12A(1)]
  • Institution/fund approved under the clause (vi) of section 80G(5) [ proviso clause (vi)]

Time Limit: At least one month prior to the commencement of the previous year relevant to the assessment year from which the said approval is sought

From-10AB:

Who are required to fill Form-10AB?

1. Trust/ Institute registered or approved as per the new law effective from the 1stApril 2021 and the period of approval is due to

  • Fund or trust or institution or any university or other educational institution or any hospital or other medical institution referred to in sub-clause (iv) or (v) or (vi) or (via) of section 10(23C) approved under the first proviso effective from 1st April 2021
  • Trust/Institute registered under section 12AB
  • Institution/fund approved under the proviso of clause (vi) of section 80G(5) effective from 1st April 2021

Time Limit: Trust/ Institute should apply at least 6 months prior to the expiry of the period.

2. Trust/ Institute provisionally registered* or Provisionally approved* as per the new law effective from the 1st April 2021 and the period of Provisional approval is due to expire or activities has been commenced

  • Fund or trust or institution or any university or other educational institution or any hospital or other medical institution referred to in sub-clause (iv) or (v) or (vi) or (via) of section 10(23C) approved under the first proviso effective from 1st April 2021
  • Trust/Institute registered under section 12AB
  • Institution/fund approved under the proviso of clause (vi) of section 80G(5) effective from 1st April 2021

Time Limit : Trust/ Institute should apply

    • At least 6 months prior to the expiry of the period Or
    • Within6 Months from the date of commencement of its activities

3. Trust / institution has become inoperative due to the first proviso to sub-section (7) of section 11 [ sub clause(iv) Clause (ac) of section 12A(1)].

Time Limit : At least six months prior to the commencement of the assessment year from which the said registration is sought to be made operative.

4. where the trust or institution has adopted or undertaken modifications of the objects which do not conform to the conditions of registration [sub clause (v) Clause (ac) of section 12A(1)]

Time Limit: Within a period of 30 days from the date of such adoption or modification.

*Provisional approval or registration will be given for a period of 3 years from the assessment year from which registration is sought

**Approval or Registration will be given for a period 5 years.

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Disclaimer: The contents of this article have been prepared in accordance with the relevant provisions, and information available at the time of preparation. The views and opinions expressed in this article are those of the author and the author does not take any responsibility and cannot guarantee that no inaccuracy occurs

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