01 November 2013
If a society is carrying on charitable activities of education institutions and is approved u/c 10(23C) and the following defects are found in the return after the scrutiny u/s 142 started:
1) On some expenses TDS was not deducted 2) Payments were made which were ineligible as deduction due to 40(A)(3) dis allowance.
Since, the entire income is exempt under section 10(23C), will any tax be leviable on these amounts or not?
01 November 2013
Which kind of payment you are talking about.
Under section 10(23C)(iv) and (v) of the Income-tax Act, income received by certain charitable and religious funds, trusts and institutions is exempt from tax if the conditions specified for this purpose are satisfied. One such condition, as laid down in the third proviso to section 10(23C), is that the fund, trust or institution applies its income, or accumulates it for application, wholly and exclusively to the object for which it is established and it does not invest or deposit its funds (other than voluntary contributions received and maintained in the form of jewellery, furniture or any other article as the Board may, by notification in the Official Gazette specify) for any period during the previous year otherwise than in any one or more of the forms or modes specified in sub-section (5) of section 11 of the Income-tax Act. For expenses disallowances go to the following link:
01 November 2013
As per my understanding, it is required to deduct TDS from salary paid, because it is taxable under the person who is getting salary. It will not be considered as charitable activities.
So TDS will be considered by such society at the time of making payment of salary.
01 November 2013
Sir, the case has now opened up in scrutiny u/s 142 and we want to offer Rs.840000 on account of non compliance of TDS provisions and disallowance u/s 40(A)(3).
My query is that:
Since the entire amount earned by the aop is exempt u/s 10(23C), will any tax be liable to be paid on this offer?
01 November 2013
I will give a letter about disallownace of expenses to the tune of Rs. 840000. I know that if I do so in a case of co., firm or Individual, I will have to pay tax including interest.
I want to know that if the same action is done by an AOP having exemption u/s 10(23C), will the AOP have to pay any tax.....?
Since, even if the AOP had not claimed any expense against the its gross receipts while filing return of income, its entire income would have been exempt.
What will be the case if we offer to disallow the expenses now or revise the return with these changes? Will any tax be payable?