Principles of taxation law (taxation law- I)

Project topic:
Assessment of charitable and other trusts

Submitted By
Gauhar aHMed sayeed
Roll no. 1128
4 Year, 7 Semester, B.A.,LL.B.(Hons.)
th th

Submitted to
Dr. G.P. Pandey
Faculty of taxation Law

Chanakya national Law University, Patna

September, 2017
 Introduction

Income tax act provides exemption to the Income of Charitable and religious trusts.
However, the process of Exemption is not as simple as it seems in words. There are multi-
layered exemptions depending upon the Trust.

To execute a Trust, there must be a trust deed. Trust is a fictional person so it must be given
the form of legal fiction by the written Indenture which is technically known as trust deed.
So far as Gujarat is concerned Bombay Public Trusts Act 1950 deals with the registration
and inception of the trust. However trust can be registered under Companies Act as well
and those are termed as Section 25 Companies as per the erstwhile Companies Act 1956.
However we focus on registration in Income Tax Act.

Income Tax Act, 1961 grants the exemption to both the religious as well as the charitable
trusts. Now it is very material to decide what constitutes Religious Activities and what
constitutes Charitable activities So far as religious activities are concerned the law is
silent. However religious activities can easily be inferred out from the trust deed itself.
Any trusts formed in order to encourage the religious activity can be understood as religious
trust. The term religious activities dont leave much scope for subjective interpretation.

Aims & Objectives

The project aims at understanding the provisions given under Income tax law in India
regarding taxation of charitable trusts and other forms of trusts with the help of key cases.

Hypothesis

The researcher is of the belief that since the trusts mainly charitable and religious are not
for profit making and hence are exempted from tax liabilities.

Methodology

The type of methodology used in research is basically the doctrinal form of research for
which the researcher had gone through various books related to Taxation Law. However
the most helpful aid has been the online materials.

Tentative Chapters

1. Introduction
2. Kinds of Trusts.
3. Assessment of Trusts under Income Tax Act.
4. Landmark Case Laws.
5. Conclusion.
 Books Referred

1. V.K. Singhania, Students Guide to Income Tax, Taxmann.

2. Vikas Mundra, Tax Laws and Practices, Law Point Publications.
3. Girish Ahuja and Ravi Gupta, Systematic Approach to Income Tax, Bharat Law House.