As per report in a dramatic development for Tata Trusts, the office of the Principal Commissioner of Income Tax, mumbai, has by its order dated october 31, 2019, cancelled the Income Tax registration of six Tata Trusts, namely Jamsetji Tata Trust, R.D. Tata Trust, Tata education Trust, Tata Social Welfare Trust, Sarvajanik Seva Trust and Navajbai Ratan Tata Trust.

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Meanwhile the development comes after Tata Trusts decided last month to contest the reopening of assessment by the Income Tax (I-T) department, saying they already surrendered registration provisions under the I-T Act and the levy of additional income tax when a charitable trust converts into or merges with a non-charitable trust or transfers its assets on dissolution to a non-charitable institution cannot be applied to them. According to Section 115 (TD) of the Income Tax Act, a trust whose registration is cancelled is required to pay tax on its accumulated or "accredited" income.



Moreover the Trusts have clarified that this order of cancellation is a culmination of the decision taken by these six Trusts in 2015 to surrender, of their own volition, their registrations under the Income Tax Act and not to claim the associated income tax exemptions. Apparently the I-T department's order has cancelled the Trusts' registrations with immediate effect, Tata Trusts added that they believe that as a matter of law, and consistent with the I-T department's own decision in the past, the cancellation should take effect from 2015, when the registrations were surrendered and the Trusts themselves consented to cancellation.


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