The Central Board of Direct Taxes (CBDT) has issued a clarification concerning the Audit Report Requirements outlined in Section 119 of the Income-tax Act, 1961, applicable to ‘Substantial Contributors’ in the Assessment Year 2023-24 via circular number 17/2023.
This clarification primarily emphasizes the necessity of furnishing comprehensive information about ‘substantial contributors’ using either Form No. 10B or 10BB for the Assessment Year 2023-24.
The circular stipulates that this information should encompass individuals whose annual contributions surpass Rs. 50,000/-, and should also encompass details about their relatives and any related entities if such information is available.
In the context of audit reports about funds, trusts, institutions, universities, educational institutions, hospitals, and medical institutions, as stipulated in clause (b) of the tenth proviso to clause (23C) of section 10, or sub-clause (ii) of clause (b) of sub-section (1) of section 12A of the Income-tax Act, 1961, Form No. 10B/Form No. 10BB is mandated.
The CBDT has received feedback regarding the challenges associated with documenting the details of individuals making ‘substantial contributions to the trust or institution,’ which are defined as persons whose cumulative contributions by the end of the relevant previous year exceed Rs. 50,000.
Upon careful consideration of the raised concerns, it has been clarified that to complete Form No. 10B and Form No. 10BB for the Assessment Year 2023-24, several key details must be provided.
Read Also:- CBDT Amends I-T Section 80LA Via Notification No. 57 /2023/F. No. 275/19/2023-IT(B)
Firstly, information regarding individuals making substantial contributions should be submitted, focusing on those whose total contributions during the preceding year exceeded fifty thousand rupees.
Additionally, if available, details of relatives of such individuals should also be included. Finally, if relevant, information about entities in which such individuals hold a significant interest should be furnished.
