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Report No. 12

89. Donations for charitable purposes.-

(1) Subject to the provisions of this section, the assessee shall be entitled to a deduction from the amount of income-tax on his total income with which he is chargeable for any assessment year of an amount equal to the income-tax calculated at the average rate of income-tax on any sums paid by him in the previous year as donations to any institution or fund to which this section applies.

[Section 15B(1), main para., and 17(2), part]

(2) No deduction shall be made under sub-section (1) if the aggregate of the sums paid as aforesaid by the assessee is less than two hundred and fifty rupees.

[Section 15B(1), 2nd proviso (a)]

(3) No deduction shall be made under sub-section (1) in respect of any sums paid in excess of one-twentieth of the assessee's total income as reduced by any portion there of on which income-tax is not payable under any provision of this Act and by any amount in respect of which a deduction of income-tax has been granted under the provisions of this Chapter, or one hundred thousand rupees, whichever is less.

[Section 15B(1), 2nd proviso (b)]

(4) The amount of income-tax deductible under this section, together with the amount of super-tax deductible under section 109 [section 15B-for super-tax] shall not in any case exceed half the aggregate of the donations in respect of which the deduction is allowed under this section.

[Section 158(3)]

(5) This section applies to any institution or fund established in India for a charitable purpose which fulfils the following conditions, namely:-

(i) if the institution or fund derives any income, such income would not be liable to inclusion in its total income under the provisions of section 12(1) to 12(4) [section 4(3)(i)] or section 12(5) [4(3)(ii)] or section 11(24) [new provision added in the draft clause for exclusion from total income, which relates to universities or other educational institutions not existing for profit];

(ii) the institution or fund is not expressed to be for the benefit of any particular religious community;

(iii) the institution or fund maintains regular accounts of its receipts and expenditure; and

(iv) the institution or fund is either constituted as a public charitable trust or is registered under the Societies Registration Act, 1860 (21 of 1860), or under any law corresponding to that Act in force in any part of India or under section 25 of the Companies Act, 1956 (1 of 1956), or is a university established by law, or is any other educational institution recognised by Government or by a university established by law, or affiliated to any university established by law or is an institution financed wholly or in part by the Government or a local authority.

[Section 15B(2), main para.]

(6) An institution or fund established for the benefit of scheduled castes, backward classes, scheduled tribes or of women and children shall not be deemed to be an institution or fund expressed to be for the benefit of a religious community within the meaning of clause (ii) of sub-section (5).

[Section 15B(2), Expin.]

Income-Tax Act, 1922 Back

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