CBDT Clarifies Rules for Cancelling Trust/Institution Registration in Circular No. 11/2022: Key Highlights
The CBDT has issued Circular No. 11/2022, providing clarity on the process for cancelling or re-registering trust/institution registrations. Here’s a concise summary of the key points:
Re-registration/Approval Requirement: Trusts and institutions seeking re-registration or re-approval under sections 10(23C), 12AB, or 80G of the Income Tax Act must apply using Form 10AB to the Principal Commissioner or Commissioner of Income Tax.
Processing Application: After receiving the application, the Income Tax Authorities will process it and issue an order in Form 10AC, either granting or denying the registration/approval.
Unique Registration Number (URN): If approved, a Unique Registration Number (URN) will be assigned to the trust/institution, ensuring proper recognition for compliance purposes
Registration Process Under Form No 10AC
Eligibility:
Charitable or religious trusts and institutions seeking registration or approval under sections 12A, 12AA, 12AB, or 80G of the Income Tax Act, 1961.
Application Process:
File Form 10AB Online:
Submit Form 10AB via the Income Tax e-filing portal: https://incometaxindiaefiling.gov.in/.
Attach necessary documents such as the trust deed, registration certificate, list of trustees, etc.
Processing by Authorities:
The Principal Commissioner or Commissioner of Income Tax will review the application and the attached documents.
They may request additional information or clarifications if needed.
Order for Registration or Approval:
If the application meets the necessary criteria, the authority will issue an order in Form 10AC.
Form 10AC will contain key details like the trust/institution’s information, the registration/approval validity period, and any applicable conditions
Form No 10AC Online Verification
Visit the Income Tax Department’s website: https://incometaxindia.gov.in/.
Under ‘Quick Links’, click on ‘Verification of Trust Registration’.
Enter the PAN of the trust/institution to check its registration status and Form No 10AC details
How to Download Form 10AC:
Access the Forms Page: Visit the Income Tax Department’s official Forms page.
Download Form 10AC: Click on the ‘Download’ link next to Form 10AC.
Save and Complete: Save the form as a PDF, fill it out offline, and submit it physically to the designated tax authority, along with the required documents
What Are the Benefits of Form No. 10AC?
Form No. 10AC plays a crucial role in securing tax-related approvals for trusts and institutions under various sections of the Income Tax Act. Below is a comparison with Form 80G to highlight its scope and benefits:
| Aspect | Form No. 10AC | Form 80G |
|---|---|---|
| Purpose | Used for granting registration/approval under sections 12A, 12AA, 12AB, and 80G. | Specifically allows the institution to issue tax-deductible donation receipts. |
| Scope | Covers a broad range of tax exemptions for charitable and religious entities. | Focused solely on enabling deductions for donors under section 80G. |
| Timeline | Registration is typically valid for a specified period and renewable. | Validity depends on the nature and compliance of the entity |
Key Amendments via the Finance Act, 2022
The Finance Act, 2022 brought significant changes, including:
Empowering the Principal Commissioner or Commissioner of Income Tax to review “specified violations” by registered or provisionally registered trusts/institutions.
Based on the review, the authority may cancel or retain the registration.
These changes necessitate a reassessment of conditions under which registration or provisional registration was initially granted
CBDT Clarification on Form No. 10AC
The Central Board of Direct Taxes (CBDT) has issued revised conditions for granting registration or approval under the following sections of the Income Tax Act:
Section 12AB – Re-registration and provisional registration
Section 10(23C) – Re-approval and provisional approval
Section 80G – Re-approval and provisional approval
These updated conditions apply specifically to registrations granted through Form No. 10AC issued between April 1, 2021, and June 3, 2022. As per the CBDT Circular (No. 11/2022), such registrations are now governed by the revised terms effective from April 1, 2022.
Clarification on Provisional Registrations/Approvals
The CBDT further clarified that:
If Form No. 10AC issued during FY 2021–22 mistakenly bore the heading “Order for provisional registration” or “Order for provisional approval” due to technical errors,
Such forms will now be deemed valid as full registration or approval orders
FAQs on Form No. 10AC and 80G Approval
1. What key information is required when filling out Form No. 10AC?
Applicants must provide the following:
Organization Details: Name, address, PAN, registration type, and objectives
Trust Details (if applicable): Trust deed, trustee names, and roles
Activities & Financials: Nature of charitable/religious activities, income sources, and expenditure
Financial Records: Audited financial statements for the past 3 years
Supporting Documents: Trust deed, registration certificate, and other relevant legal or administrative documents
2. How can an organization apply for 80G approval using Form No. 10AC?
An organization must first be eligible under sections 12A, 12AA, or 12AB. The application for 80G approval is made by submitting Form No. 10AC electronically via the Income Tax e-filing portal, along with all necessary documents uploaded online.
3. Is there a deadline for submitting Form No. 10AC for 80G approval?
There is no fixed deadline. However, to ensure eligibility for tax deduction in the same financial year, it’s advisable to submit the form before the end of the financial year.
4. What happens if an organization fails to submit Form No. 10AC or comply with its requirements?
Non-submission or non-compliance may result in:
Rejection of 80G approval
Loss of donor tax benefits
Possible penalties or legal action under the Income Tax Act
5. Can changes be made to Form No. 10AC after submission?
Yes.
Minor corrections can be made through a rectification request on the e-filing portal
Significant changes may require re-filing or submission of a revised application
6. Are there any fees for filing Form No. 10AC for 80G approval?
No. The submission of Form No. 10AC is free of charge.
7. How long does it take to receive approval under Section 80G after submitting Form No. 10AC?
The typical processing time is 3 to 6 months, though it may vary depending on the complexity of the application and the department’s workload.
