Dear Friends,

Greetings from Hyderabad!

I have the following question:

  1. There is a registered Trust/Society with a Chief Functionary in place
  2. The same Trust/Society goes ahead with the registration as a Section 25 company.

My question to all of you is:

  1. Can the CF of the original Trust/Society be the CF of the section 25 company?
  2. If yes, what are the necessary conditions to be followed in this regard.

Thanks and regards,

B V Soma Sastry

Director – Finance and Admin

Centre for World Solidarity

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3 Responses to Section-25C

  1. s.srinivasn says:

    Dear Sir
    Please note that the 12 A registration has been granted to you on the basis of the papers filed by you as a trust including the trust deed. Now since the section 25 company is a different legal entity you may have to apply to get the registration under section 12 A afresh, and may be for one year you may have to file two returns and have two accounts .

    This may be kept in view before converting it into a section 25 company , as there is no real benefit of converting

    As regards the remuneration paid , as has been pointed out you have to be careful in not violating the section 13 (3)

  2. Pushkar gupta says:


    To become chief functionary of company, he can become the executive director of the company, the resulting of this he would become the managing director the company.



  3. Sriraman says:

    Dear Sastry

    A trust/society and a sec 25 company, although may have the same CF, a common board, common objectives, etc., in the eyes of the law are two separate water-tight compartments.

    As such, there is nothing in law that prevents a single CF from functioning as CF for both the trust/society and the Sec 25 company. You may only need to read Section 13 (3) of the Income Tax Act, with a real magnifying glass, to see what amounts to an interested party transaction, as I would imagine, there could be transactions between the society/trust and the company concerned, with a common CF. I presume, both are 12A registered and section 13(3) would apply to both.

    Hope you find this useful

    Best regards


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