Dear Members,
Please let me know the procedure for amending the Trust deed. Whether Income Tax department permission is mandatory? The proposed amendment is only for Trustees re-appointment and sale of building.
Looking forward to your valuable advice.
Best,
Shekar
I want to change fcra bank a/c . I am really confuse because i dont have any format for changing . and also dont know procedure . plz help me
Dear Mr. Shekar,
For Trustees re-appointment and sale of building owned by the Trust, you do not need amendment o the Trust Deed. You have to adopt resolution to that effect in your Trust Board meeting and go ahead with the work.
If your Trust has got IT exemption under Section 12 (A) (a) of IT Act, then you have to get permission from the IT Commissioner for sale of building. The general principle is normally the Trust should not sell its asset, unless it becomes unusable or the sale is for the benefit of the Trust. So, before starting the proceedings for the sale, send a communication to your IT Commissioner intimating him about the proposal to sell the building, indicating why you want to do so and wait for his approval. If it takes inordinately long time, you may go ahead with the sale, having intimated your proposed intention to the Commissioner. Bring the sale proceeds to your account promptly. If the building had been originally purchased from local fund, deposit the sale proceeds in local funds and if it was purchased from FC fund, deposit he sale proceeds in FC account. Don’t forget to include this transaction in your IT return.
Regards.
S.S.Shiva
Thank you Shiva, for a very comprehensive response.
I would just like to add for general information of members that Charity Commissioner in Mumbai (for NPO entities registered in Maharashtra & Gujarat) is very particular and would strongly suggest that any proposed change in the Trust should be got prior approved. In case of sale of property they would not permit it unless convinced that sale is genuinely required and does not impact the operations of the charitable Trust.
Further generally change of Trustees nned not be amended through the Trust Deed, as long as their is explicit power in the Trust authorising existing trustees to appoint new ones. Resolutions for the appointment must be properly signed and be part of minutes to be kept in records.
rgds