Marginal Tax Relief: S.12AA registration not to be cancelled

Most of us are aware that charitable institutions functioning under the remainder clause (i.e. advancement of objects of General Public Utility) are always worried that their income from sources which could be treated as from commerce, trade or business should not cross the lakshman rekha of 20% of total income (earlier this was a fixed monetary limit of Rs 25 lakh). If they crossed this limit, Income Tax officers generally would move application to cancel the registration under S. 12AA of such an entity.

CBDT has now issued instructions to all Income Tax Officers vide a circular[1] that in case a charitable institute crosses this limit, then while its income for that year would not be treated as charitable and would be subjected to taxation, however its registration for that year will not be cancelled. Therefore in case, the next year, the income remains within the permissible limit, the entity will be treated as charitable for that year.

The circular also states that above is important so that such one-time taxation of a charitable institution should not result in unintended taxation on accreted income under S. 115TD[2], which could result in additional tax liabilities.

Socio Research & Reform Foundation (NGO)
512 A, Deepshikha, 8 Rajendra Place, New Delhi – 110008
e-mail:; website:

[1] Circular No. 21/2016 dt 27 May 2016
[2] S. 115TD not only imposes tax liability on accreted income of any charitable agency whose registration is cancelled, etc. but would also need to pay additional penalty if the tax is not paid within 14 days.
Posted in FCRA, TAX, LEGAL | Comments Off on Marginal Tax Relief: S.12AA registration not to be cancelled

Huge reduction in funds under FCRA

As most of the stakeholders associated with Voluntary Sector had been lamenting regarding shrinking of FCRA funds for the Sector. Now this is confirmed. In a press report based on a RTI application filed by, a media portal, it is now confirmed that FCRA funds for FY 2014-15 were only Rs 8756 crores compared to Rs 13,115 crores during FY 2013-14. A reduction of over 33% of funding.

State-wise most states funding has come down, but Delhi, having a large number NGOs’ Head Offices’ used to be the highest FCRA fund receiver, however it has been drastically come down by more than 50%. Tamilnadu and Andhra are the other two states where FCRA funds have declined significantly.

Considering that many religious organisations are likely to continue to receive funds, even if reduced marginally, the impact is likely to be most pronounced on the organizations working in the social development sector and worse off are likely to be the ones predominantly in the advocacy and human rights arena. Several social development organizations fear this trend is likely to continue for the time being.


Socio Research & Reform Foundation (NGO)
512 A, Deepshikha, 8 Rajendra Place, New Delhi – 110008
e-mail:; website:
Posted in FCRA, TAX, LEGAL | 6 Comments

Applicability of TDS and Service Tax on Project Grants

Dear Dialogue Members,

Ours is a Corporate with over 51% of FDI. We also have a registered Foundation. We release project grants through these two sources to local NGOs. What kind of taxation is involved when we release money to NGOs? TDS and Service Tax.

Thanks & Regards,

R S Sharat

Posted in FCRA, TAX, LEGAL | 3 Comments

How to deal with erroneous Bank Deposits?

Dear Sir/Madam

An FCRA registered organization has erroneously given its FCRA bank account number to a local donor. These funds were to be received as local donation. Effectively, Local  donations are credited to FCRA account (Amounting to Rs.2.88 lacs). What is the remedy. What steps should be taken to rectify the mistake.

Thanking you in anticipation.

Paresh S Sarda
1/1170 Sadashiv Peth
Tilak Road, Pune

Posted in FCRA, TAX, LEGAL | 6 Comments

FCRA Renewal trickling in

Dear Dialogue members,

You will all be glad to know that the FCRA department has started issuing FCRA renewal order for 5 years from 1-11-2016. Some NGOs in our area have already received it. Others are awaiting. The order does not have a signature of the issuing authority and the e-mail from FCRA department mentions that it was digitally signed, but the banks are not accepting it without signature. The order copy has not been marked to the banks directly by the department and the NGOs have been asked to hand over a copy to the bank/s, where they have FCRA account/s. They have also not yet published a list of NGOs who have been issued with he renewal order.

I have written to the Director, FCRA about all these lacunae. Those NGOs who have not yet received the order may constantly watch the official e-mail inbox of the their organisation.

FCRA consultant
Coimbatore, Tamil Nadu

Posted in FCRA, TAX, LEGAL | 6 Comments

PF withdrawal

Dear Sir

Good evening!!!

Please tell me about how fill up15 G form of Pf withdraw.

Vijkendra Kumar

Posted in FCRA, TAX, LEGAL | 2 Comments

Applicability of PF on Volunteers.

Dear Members,

We need counsel about the subject “PF Applicability on Volunteers’ Honorarium Payment. The volunteers are not on rolls and there is no control over their attendance and they work for their village development in association with an NGO for a period of one year. Will that NGO has to contribute towards PF for their payment ranges from Rs.600 – Rs.1200/-? Likewise thousands of volunteers are associated with that NGO.

With Regards,

Prasanna Bollam

Posted in FCRA, TAX, LEGAL | 10 Comments

Any limit for quarterly disclosure of FCRA receipts?

As per FCRA 2010, when an organization receives FCRA funds, the details of the amount and the donor are required to upload into the website of the concerned organization. I would like to know the limit prescribed: for example is it 10 lakh above or any foreign funds?


Posted in FCRA, TAX, LEGAL | 9 Comments

FCRA Registration Validity extended to 31st October 2016

We are happy to inform everyone that an official Notification dated 29th March 2016 has been brought out by FCRA Dept announcing

  • Validity of all FCRA Registration certificates expiring before 30th September 2016 extended to 31st Oct 2016.
  • Renewal Application date extended to 30th June 2016.

The above means that all persons who apply for renewal before 30th June 2016 would remain valid till 31st October 2016 unless further renewed or rejected by the Dept. before that date.

Any person who does not apply for renewal and whose FCRA certificate is valid, FCRA registration date will expire on 31st October 2016.

Hope this will relieve a lot of anxieties amongst FCRA bodies, who were getting worried that renewal will expire on 30th April 2016….(click here for more details)

Socio Research & Reform Foundation (NGO)
512 A, Deepshikha, 8 Rajendra Place, New Delhi – 110008
e-mail:; website:

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Feedback Report of Workshop – Responsible CSO Boards of the Future

Feedback Report of Workshop
Responsible CSO Boards of the Future
[Saturday, 19th March 2016, India International Centre (Annexe), New Delhi – 110003]

Dear Friends with a special Hello to all the Participants who attended the workshop.

We thank all the participants who attended the workshop which was one of the most interactive workshop organized by SRRF so far. Credit for this goes to all the participants, who engaged the faculty and remained focused throughout the day. Through this communication we share your feedback and other details that we promised during the workshop.

The Feedback forms have been compiled and collated. There were 29 participants, 72% of whom have given their feedback. Feedback required scoring for each session as well as for overall workshop. The feedback gives score of 92% for the overall workshop. A chart of session-wise results is given below.


Following suggestions are given by the participants:

  • Should improve Panel Discussions.
  • Include few more case studies.
  • More interaction on basics.
  • Little more space for participation of participants would have made them more interactive.
  • Corporate could also be involved in some discussions.
  • Small water bottle in the lecture room should be served for every participant.
  • To organize some more workshop covering several other topics like Accounting for NGO’s, Changes and updates related to statutory compliance , Taxation,  CSR .

(Note: SRRF has been regularly organizing training programmes in these areas since the year 2010.)

We will try to consider all your suggestions to further improve.

We have also uploaded the presentations of the workshop at our website including snaps. Please visit SRRF website to get access to the same.

We have also uploaded the snaps of the participants on SRRF facebook page.

Once again I thank you on behalf of SRRF, on being a part of a wonderful and learning workshop on ‘Responsible CSO Boards of the Future’.

With warm regards

Ramanuj Maurya
Socio Research & Reform Foundation (NGO)
512 A, Deepshikha, 8 Rajendra Place, New Delhi – 110008
e-mail:; website:

Posted in CSR | Comments Off on Feedback Report of Workshop – Responsible CSO Boards of the Future