GOVERNMENT OF INDIA
MINISTRY OF FINANCE
DEPARTMENT OF REVENUE
UNSTARRED QUESTION NO. 1056
TO BE ANSWERED ON TUESDAY, THE 25th July, 2017 / SHRAVANA 3, 1990 (SAKA)
Tax Exemption for Charitable Institutions
Will the Minister of FINANCE be pleased to state:
(a) Whether Government is aware that trusts that hold majority of shares of large groups are actually directing and managing controlling companies and receive thousands of crores of dividends and do not pay any tax because they are supposedly tax exempt charitable institutions;
(b) What are the tax exemption criteria for charitable institutions; and
(c) The Steps taken by Government to plug this loophole?
MINISTER OF STATE IN THE MINISTRY OF FINANCE
(SHRI SANTOSH KUMAR GANGWAR)
(a) Such information is not maintained in CBDT in a centralized manner. However, the trusts and charitable institutions, whose income are exempt under the relevant provisions are the Income-tax Act 1961 (the ‘ACT’) and meet the conditions prescribed therein, are not required to pay income tax.
(b) The main tax exemption related provisions for charitable institutions are prescribed under section 10(23C) and section 11 to 13 (read with section 2(15)) of the Act.
(c) Not applicable in view of (a) above.