35 AC Registration: Don’t just donate, donate right…..

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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