Seminar on 

Issues related
to Taxation of NGOs/ NPOs
Organized by:
Greater Noida CPE Study Circle of CIRC

Mode: Physical
By: Suresh Wadhwa, LL.B., FCA

May-27-2023
Time: 5.00 PM to 7.00 PM
Audiences/Participants: Members of ICAI
Topics to be covered:-
 Introduction & Background.

 ITR of NGOs/ NPOs- One of most serious professional assignment;

 Books of Accounts prescribed for NGOs & NPOs;

 New Form-10B & 10BB from AY 2023-24;

 Maintaining your Tax Exemption u/s 11 or u/s 10(23C);

 Most Common reasons behind unwarranted tax demands from CPC;

 Latest Changes/ or Amendments; and

 Questions & Answers

 NGOs/ NPOs

Trust Society

Section-8 Other
Institutions
Company e.g. Universities/ Hospitals [AIIMS/ DU],
Noida, HUDA etc.
First Regime-NGOs
Section-10(23C)
(iv)/(v)/(vi)/ or (via)
(Approval)
Second Regime-NGOs
Section-11 & 12
(Registration)
 The road to NGOs & NPOs is not easy…..

 Maintenance of Books for NGOs has been

prescribed vide Notification No. 94/2022 dt
10.08.2022; and
 Tax Audit Report on Form-10B (49 Clauses/ or
10BB (32 Clauses) has been immensely revised
vide Notification No. 7/2023 dated 21.02.2023.
 The road to NGOs & NPOs is not easy…..

The ITR filing of an NGO on Form ITR-7 along

with TAR [Form-10B or 10BB] is much more
complicated & comprehensive than filing of Form
ITR-6 of a Private Limited Co. with TAR on
Form-3CA3CD
No one [Assessee or Auditor] can afford the
non-filing of ITR of an NGO/ NPO-
Illustration:
Assessme nt Ye ar 2 0 2 2 -2 0 2 3
ABC Private Limite d Company ABC Public Charitable Trus t
Particulars Amount (INR) Particulars Amount (INR)
Gros s Re ce ipts 1 0 ,0 0 ,0 0 ,0 0 0 Source of Funds 1 0 ,0 0 ,0 0 ,0 0 0
Le s s : All Expe ns e s 9 ,0 0 ,0 0 ,0 0 0 Le s s : Application of Income 9 ,0 0 ,0 0 ,0 0 0
Ne t Profits 1 ,0 0 ,0 0 ,0 0 0 Surplus 1 ,0 0 ,0 0 ,0 0 0

ITR not file d by Late s t by De ce mbe r-3 1 -2 0 2 2 ITR not file d by Late s t by De ce mbe r-3 1 -2 0 2 2

Today, an Update d Re turn can be file d u/ s 1 3 9 (8 A) The Option of Se ction 1 3 9 (8 A) is not available

Tax Liability 3 1 ,2 0 ,0 0 0 If a Notice is re ce ive d today, the n?

Unde r Update d Re turn @ 1 2 5 % 3 9 ,0 0 ,0 0 0 No Exe mption u/ s 1 1 & 1 2 3 ,0 0 ,0 0 ,0 0 0
Plus Inte re s t & Late filing fe e . Plus Inte re s t & Late filing fe e .
ITR-7 On Time Registrations u/s
12AB/ or 10(23C)
Maintaining
Tax
Exemptions
for NGOs &
NPOs?
TAR on Form-9A / 10
Form-10B/ 10BB on Time
Most Common reasons for unwarranted & enormous
tax demands to NGOs & NPOs from CPC-
Bangaluru-
TAR on Form-10B/ 10BB not filed at all by the Tax Auditor
or has been filed beyond the due date.

ITR has been filed on a wrong ITR Form i.e., on ITR-5

instead of ITR-7 or vice-versa;

Incorrect Registration Numbers have been punched in the

ITR-7 like 80G Reference No. punched instead of 12AB;
Most Common reasons……….

Form-9A or Form-10 has not been filed or Wrong Form

filed.

Details punched in TAR on Form-10B are mismatching with

the details punched in Form-ITR-7

ITR has not been compiled in a meticulous manner.

Circular No. 6 of 2023 dated May-24-2023

Form 10A: Re-Registrations for 5 Years | Last Date: 25.11.2022 |

Extended upto: 30.09.2023
History: 30.06.2021 > 31.08.2021 > 31.03.2022 > 25.11.2022

Form 10AB | Last Date: 30.09.2022 | Extended upto: 30.09.2023

Note: The due date for Form-10AB in respect of Section-80G Application has not been extended and therefore
Section 80G Registrations are getting rejected.

Provisions of Section-115TD not to apply w.e.f. AY 2023-2024 in case of

delay happened as above
Circular No. 6 of 2023 dated May-24-2023

In all Cases, where Form-10AB filed after 30.09.2022 and the CIT (E)
has not passed an Order before the issuance of this Circular, pending
applications on Form-10AB may be treated as Valid Applications.

Where the CIT(E) had already rejected the grant of Registrations solely
on account of delay in filing of applications, the NGO may furnish a
fresh application in Form-10AB upto 30.09.2023;
Circular No. 6 of 2023 dated May-24-2023

Form-10A [Re-Registrations] was not filed upto 25.11.2022. Registrations were

lapsed. NGOs again filed Form-10A for seeking Provisional Registration. Such
NGOs can withdraw their Form-10A seeking Provisional Registration and they
can make a Fresh Application for Re-Registration upto 30.09.2023;

The Due date for furnishing Annual Return of Donations on Form-10BD and
Certificate of Donation on Form-10BE extended from 31.05.2023 to 30.06.2023
Circular No. 6 of 2023 dated May-24-2023

Finance Act, 2023 prescribed the Due date of filing of Form No. 9A and
Form No. 10 as at least 2 months prior to the date of filing ITR u/s
139(1).

Clarification: However, the Accumulation/ deemed application shall not

be denied to a trust as long as Form No. 9A and 10 is furnished on or
before the due date of filing of ITR u/s 139(1).
 Difference between Free Accumulation & Specific
Accumulation-
Sr. No. Bas is of Diffe re nce Fre e Accumulation upto 1 5 % Spe cific Accumulation be yond 1 5 %
1 Section Section 11(1)(a) & (b) Section 11(2)
2 Period of Accumulation Indefinite Maximum 5 Years
3 How to apply? No Application Form is required to be filed.
Form No. 10 is filed.
The Amount of Specific Accumulation
can be applied only for those purposes
The amount of free accumulation can be
which were reported in Form-10 or
4 Application in Future applied for any purpose as given in the
with the specific permission of the AO
Trust Deed.
in case of Change in the proposed
uses.
Any Donation paid out of Accumulated
General Donations out
5 No such restictions funds will not be treated as
of Accumulation
Application.
Corpus Donations to Other Trusts is not Any Donation paid out of Accumulated
Corpus Donations out
6 treated as Application of Income [Expl 2 to funds will not be treated as
of Accumulation
Section 11] Application.
Questions/ Answers
 For Queries & further clarifications: -
Suresh Wadhwa, LL.B., FCA

E: office@sharkauditors.com
M: +91 98102 90022
T: +91 120 410 6738