By R. S. Kadakia, Chartered Accountant
INTRODUCTION
Section
12A(1)(b) of the Income-tax Act 1961 (“the Act”) has been amended by
the Finance Act, 2022 w.e.f the assessment year 2023-24 to provide that a
charitable institution claiming exemption u/s 11 and 12 shall keep and
maintain books of account and other documents (“books of
account/documents”) in such form and manner and at such place, as may be
provided by rules.
BRIEF ANALYSIS OF THE SECTION
(a)
On a literal reading, even a solitary point of difference between the
assessee and the Assessing Officer (“AO”) as to whether prescribed
books/documents are maintained or whether they are maintained at the
prescribed place or whether they are maintained in the prescribed form
or in the prescribed manner can result in denial of exemption u/s 11/12
and taxation u/s 13(10). On the other hand, it has been held that
“when
there is general and substantive compliance with the provisions of a
rule, it is sufficient.” [CIT vs. Leroy Somer and Controls India (P.)
Ltd., (2014) 360 ITR 532 (Del), cited in
Worlds Window Impex (India) (P.) Ltd. vs. ACIT, (2016) 69 taxmann.com 406 (Del.-Trib.)]Also see:
• Arvind Bhartiya Vidhyalya Samiti vs. ACIT, (2008) 115 TTJ 351 (Jaipur)
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