Taxation of Trusts and Institutions – Test 1

ABC charitable trust would like to accumulate the income for the purpose of construction of school building in coming three years and therefore set apart Rs. 20 Lacs out of current year’s income. In order to exclude Rs. 20 lacs from taxable income, the charitable trust is required to inform the purpose and the period for which accumulation is made to the assessing officer in a prescribed form? Out of the followings, which one is the prescribed form?

Unless Trust is registered under section 12A of the Act, it will not be eligible for exemption under section 11, 12 and 13 of the Act. For this purpose, trust is required to make application to the Commissioner of Income tax in Form No. _____

Out of the following objects of the trust, which object does not fall within the meaning of term “Charitable Purpose” under section 2(15) of the Act?

The advancement of any other object of general public utility shall not be a charitable purpose,
if the aggregate receipts from such activity or activities during the previous year, exceeds _______ of the total receipts, of the trust or institution undertaking such activity or activities, of that previous year.

In a case, trust or institution has been granted registration under section 12AA, and, subsequently, it has adopted or undertaken modifications of the objects which do not conform to the conditions of registration, then it shall be required to make an application, in the prescribed form and manner, within a period of ______ from the date of said adoption or modification, to the Principal Commissioner or Commissioner and thereupon obtain fresh registration.

The accounts of the trust or institution for the previous year shall be audited if the total income before claiming exemption under section 1 1 and 12 exceeds _______.

In order to claim benefit of exemption under section 11, the trust is required to furnish the return of income in accordance with the provisions of section _________.

The time limit for granting registration of trust under section 12 AA is __________ from the end of month in which application is received by Pr. Commissioner.

A trust created for charitable purposes in February 2018, having filed application for registration as per section 12A on 11.4.2018, can claim benefits of sections 11 and 12 from Assessment Year__________.

Section 11(1) provides that if income of charitable or religious trust has been applied for the objects in India, then amount set apart or accumulated upto ____of income shall not be included in total income of the trust.

As per explanation to section 11(1) of the Act, voluntary contributions received by a trust are treated as _________.

Application of income under section 11(1) can be towards ______________ provided the same shall be for the objects of the trust.

As per section 12 of the Act, __________received by a trust are not treated as income.

During the previous year, if charitable trust is not able to apply 85% of its income due to _____________, then such income can be applied during the previous year in which income is received or in the immediately following previous year.

Under section 11(2), the period for which income can be accumulated shall not exceed __________ years.

The money set apart or accumulated under section 11(2) shall be invested in any one or more of the modes or forms specified under section ________ of the Act.

Work out from the following particulars, the amount of capital gain which shall be deemed to have been applied for charitable or religious purpose arising out of sale of a capital asset utilized
for the purposes of trust.
Particulars Rs.
Cost of transferred asset 2,40,000
Sale consideration 3,80,000
Cost of new asset purchased 3,00,000
Expenses in connection with transfer 20,000

Section 11(4A) provides that income from business shall be eligible for exemption under section 11(1) or 11(2) subject to few condition(s). Identify such condition(s).

Section 11(6) provides that while determining total income of the trust, no depreciation or deduction shall be allowed in respect of an asset, cost of which has been claimed as an application of income, in the _______________.The money set apart or accumulated under section 11(2) shall be invested in any one or more of the modes or forms specified under section ________ of the Act.

Identify the income in respect of which trust can claim straightaway exemption without being spent?

As per section 13 of the Act, which trust is not eligible for exemption under section 11 or 12 of the Act?

For the purpose of section 13(1) (c) read with section 13(2) of the Act, who is not an interested person / specified person?

As per section 13(4) of the Act, the aggregate of the funds of the trust invested in a concern in which any specified person has a substantial interest does not exceed___per cent of the capital
of that concern, exemption under section 11 will not be denied in relation to the application of any income other than the income arising to the trust from such investment

Section 12AA(3) provides that where a Trust or an Institution has been granted registration and subsequently the Commissioner is satisfied that the activities of such trust or Institution are
__________ or in __________, then the Commissioner has the power to pass an order in writing canceling the registration after giving a reasonable opportunity of being heard.

If exemption is forfeited due to contravention u/s. 13(1) (c) or 13(1 (d), then such income shall be taxed in the hands of chartiable trust or institution at the rate

The provisions relating to anonymous donation enumerated under section 115BBC shall not apply to _________

Under section 115BBC, anonymous donation shall be taxed at __________

Under section 115BBC, some relaxation is given while taxing anonymous donation received by a trust. That relaxation is:-

Under section 12AA, an order of granting or refusing registration of trust shall be passed within _______ from the end of the month in which application is received.

The advancement of any other object of general public utility shall be regarded as charitable purpose even if it involves carrying on of trade/ commerce/business for a cess or fee or any other consideration, if the gross receipts thereof does not exceed ———- of total receipts of such charitable institution.