Budget 2017 proposed a new
exemption under section 10(23C) to Chief Minister and LG relief funds.
Presently under section 10
(23C), exemption is provided in respect of income of certain funds which
include the Prime Minister’s National Relief Fund.
The Chief Minister's Relief
Fund or the Lieutenant Governor's Relief Fund (Section 80G (a)(iiihf)), which
is of same nature at the level of state or the Union Territory as is Prime
Minister’s National relief fund at the national level, is not exempted under
the said clause.
In the absence of such
exemption, these funds are required to obtain registration under section 12A of
the Act in order to avail exemption of its income under section 11 and 12 of
the said Act and are required to fulfil certain conditions.
Therefore, Budget 2017
proposed to amend said clause so as to provide the benefit of exemption to the
Chief Minister's Relief Fund or the Lieutenant Governor's Relief Fund also.
This amendment will take
effect retrospectively from the 1st April, 1998, the date on which sub-clause
(iihf) of clause (a) of sub-section (2) of section 80G relating to deduction in
any sum paid to the Chief Minister's Relief Fund or the Lieutenant Governor's Relief
Fund came into force, and will, accordingly, apply in relation to assessment
year 1998-99 and subsequent years.
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