In India, where doing welfare of
people is one of the core principle of society, there are about one charitable
organisation for every 1000 people and we all get phone
calls and door-knocks soliciting donations.
As a human nature,
everyone wants to help or to give for charitable cause, however, have we ever
cross check or investigate the money which we have given is been use for the
same cause or not?
Many of us may argue
that- who is going to monitor them or how can they monitor their small
contribution towards the larger good of the society or the cause.
With enforcement of
Corporate Social Responsibility under Companies Act, 2013, many self claimed
social organizations have grown up like mushrooms in every corner of the city
has caused much confusion in the mind of reasonable donors.
This situation has
also created problems for genuine charitable organizations, who are actually
working for the upliftment and development of society, as people start distrusting
them also. One way to find the credibility of organizations is through its
registrations and audited accounts.
One of such registration is
registration of NGO’s/charitable organization under the provisions of 35AC of
the Income Tax Act, which is less known but highly useful instrument of fund
raising for social cause. The objective of the said provision is to encourage
business organizations and wealthy individuals to contribute m ore towards
social welfare of general and downtrodden public. With increased emphasis on
the corporate social responsibility and ostentatious display of charity by
people like Mahindras, Birla etc., the contribution in monetary term by the
corporate sector in India towards socially relevant project cannot be
undermined. Charitable organizations involved in eligible projects for
promotion of the social and economic welfare, can raise resources for eligible
project from corporate sector or wealthy individuals and fulfill their
objective of development.
Thus Section 35AC can be used as an
effective tool of fund raising by NGO’s. It
also beneficial to donor as they receive 100% rebate of income tax on
the donated amount which makes a win-win situation for both.
To know the further
details about 35 AC registrations, contact us at admin@equicorplegal.com or visit www.equicorplegal.com
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