Centre proposes amendments in 2C, 2CA under Income-tax Rules

The Centre on Monday proposed a slew of amendments in rules 2C and 2CA, and Form No 56 and Form No 10G under the Income-tax Rules, 1962.

In this regard, a draft notification proposing the above amendments has been formulated and uploaded on the website of the Income-tax Department to seek inputs from stakeholders and the general public, which are to be sent via email by November 12, the Central Board of Direct Taxes said on Monday.

As part of the proposed amendments is the replacement of rules 2C and 2CA with a new rule 2C, and rule 11AA with new rule 11AA. The Centre has also sought replacement of and Form No 56 and 56D with a new Form No 56, and Form No 10G with a new Form 10G.

"Currently, for grant of approval under sub-clauses (iv) and (v) of clause (23C) of section 10 of the Income-tax Act, 1961 (the Act), for exemption of income received by any person on behalf of any other fund or institution, any trust or institution, rule 2C of the Income-tax Rules, 1962 (the Rules) provide for filing of application manually in Form No 56," read a statement issued by the CBDT.

"Similarly, for grant of approval under sub-clauses (vi) and (via) of clause (23C) of section 10 of the Act, for exemption of income received by any person on behalf of any university or other educational institution and any hospital or other institution, rule 2CA of the Rules provide for filing of application manually in Form No 56D," it added.

Rule 11AA provides for filing of application manually in Form No 10G for grant of approval under clause (vi) of sub-section (5) of section 80G for deduction in respect of donations to any other fund or any institution to which section 80G applies.

Keeping in view the focus of the government on digitisation, the CBDT said it is imperative that manual filing of these applications should be done away with so as to ensure not only faster processing of the same but also to reduce the interface between the department and the applicant.

Furthermore, the CBDT said amendments were necessary as there was a long-pending need to rationalise the rules and forms to align with the requirements of the present times.