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Treatment of application out of Corpus and Loans & Borrowings
from Taxmann's Budget Marathon | Charitable Trusts | Views by Dr Manoj Fogla & Suresh Kejriwal
by Taxmann
Current Treatment
Application out of corpus donations/Loans & Borrowings shall not be considered as an application for charitable or religious purposes in the year of application.
However, when such corpus donations are invested or deposited back/ loan or borrowing is repaid, such amount shall be allowed as an application in the previous year in which it is deposited back to the corpus to the extent of such deposit or investment/ to the extent of repayment of loan or borrowings.
Proposed Amendment (FROM AY 2023-24) :
Application out of corpus or loans & borrowings before 01-04-2021 not allowed even if not considered as application in the respective year
Cap on time limit of Five years to restore the corpus or repayment of loan
Amount of application out of Corpus or Loans only to the extent of eligible application of the concerned year :
The application out of corpus or loan or borrowing shall not be considered as an application if it is corpus donation, TDS not deducted, paid in cash, benefitted to related person, paid outside India, etc.
