Income Tax – Period of Validity of approvals for Certain Organisations

By Vijay Kumar

UNDER Section 10(23C) of the Income Tax Act, income of certain organisations approved by the Chief Commissioner /Director General are exempted. There are doubts among asssessees as well as officers as the period of validity of these approvals under Section 10(23C)

(iv): fund or institution established for charitable purposes

(v) : any trust (including any other legal obligation) or institution wholly for public religious purposes or wholly for public religious and charitable purposes.

(vi) : any university or other educational institution existing solely for educational purposes and not for purposes of profit

(via) : any hospital or other institution for the reception and treatment of persons suffering from illness or mental defectiveness or for the reception and treatment of persons during convalescence or of persons requiring medical attention or rehabilitation, existing solely for philanthropic purposes and not for purposes of profit

Board clarifies that the approvals are now a one-time approval valid till its withdrawal.

There is a similar doubt about the exemption to donations made to a trust approved by the Commissioner under 80G (5) (vi) .

Here also Board clarifies that any approval under Section 80G(5) on or after 1.10.2009 would be a one time approval which would be valid till it is withdrawn.

CBDT Circular No. 7/2010 Dated October 27, 2010