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20 [Conditions as to registration of trusts, etc.
21 12A. 22The provisions of section 11 and section 12 shall not apply in relation to the income of any trust or institution unless the following conditions are fulfilled, namely:—
( a) the person in receipt of the income has made an application for registration of the trust or institution in the prescribed form 23 and in the prescribed manner to the 24[Chief Commissioner or Commissioner] before the 1st day of July, 1973, or before the expiry of a period of one year from the date of the creation of the trust or the establishment of the institution, 25[ whichever is later and such trust or institution is registered under section 12AA]:
26[ Provided that where an application for registration of the trust or institution is made after the expiry of the period aforesaid, the provisions of sections 11 and 12 shall apply in relation to the income of such trust or institution,—
( i) from the date of the creation of the trust or the establishment of the institution if the Chief Commissioner or Commissioner is, for reasons to be recorded in writing, satisfied that the person in receipt of the income was prevented from making the application before the expiry of the period aforesaid for sufficient reasons;
( ii) from the 1st day of the financial year in which the application is made, if the Chief Commissioner or Commissioner is not so satisfied;]
( b) where the total income of the trust or institution as computed under this Act without giving effect to the provisions of section 11 and section 12 exceeds 27 [fifty] thousand rupees in any previous year, the accounts of the trust or institution for that year have been audited by an accountant as defined in the Explanation below sub-section (2) of section 288 and the person in receipt of the income furnishes along with the return of income for the relevant assessment year the report of such audit in the prescribed form 28 duly signed and verified by such accountant and setting forth such particulars as may be prescribed.]
20. Reintroduced by the Direct Tax Laws (Amendment) Act, 1989, w.e.f. 1-4-1989. Earlier, section 12A was omitted by the Direct Tax Laws (Amendment) Act, 1987, with effect from the same date. Original section 12A was inserted by the Finance Act, 1972, w.e.f. 1-4-1973.
21. See Circular No. 143, dated 20-8-1974 and CBDT Instruction, dated 9-2-1978. For details, see Taxmann’s Master Guide to Income-tax Act.
22. For relevant case laws, see Taxmann’s Master Guide to Income-tax Act.
23. See rule 17A and Form No. 10A for form of application for registration of charitable/religious trust, and the necessary accompanying documents, viz., 1. Original copy of instrument creating the trust/institution, i.e., trust deed, with one copy thereof, where trust/institution is created under an instrument. Certified copy in lieu of original copy of trust deed can also be accepted by the Commissioner. 2. Documents evidencing the creation of trust/institution, with one copy thereof, where trust/institution is created otherwise than under an instrument. 3. Where the trust/institution has been in existence during any year(s) prior to financial year in which application for registration is made, the application should be accompanied by two copies of accounts of trust/institution relating to prior year or years, not being more than 3 years immediately preceding the year in which application is made.
24. Substituted for "Commissioner" by the Direct Tax Laws (Amendment) Act, 1987, w.e.f. 1-4-1988.
25. Substituted for "whichever is later" by the Finance (No. 2) Act, 1996, w.e.f. 1-4-1997.
26. Substituted for the following by the Finance (No. 2) Act, 1991, w.e.f. 1-10-1991:
"Provided that the Chief Commissioner or Commissioner may, in his discretion, admit an application for the registration of any trust or institution after the expiry of the period aforesaid;"
27. Substituted for "twenty-five" by the Finance Act, 1994, w.e.f. 1-4-1995.
28. See rule 17B and Form No. 10B for audit report in case of trust/institution.