The Finance (No. 2) Act, 2024 has inserted a new section 12AC regarding merger of Charitable Trusts or Institutions in certain cases.
The Finance (No. 2) Act, 2024 has inserted a new section “12AC” with effect from the 1 st day of April 2025.
Any trust or institution registered under section 12AB or approved under sub-clause (iv) or sub-clause (v) or sub-clause (vi) or sub-clause (via) of clause (23C) of section 10, as the case may be, can merge with another trust or institution, and the provisions of Chapter XII-EB (imposed an “exit tax”) shall not apply if –
(a) the other trust or institution has same or similar objects;
(b) the other trust or institution is registered under section 12AA or section 12AB or approved under sub-clause (iv) or subclause (v) or sub-clause (vi) or sub-clause (via) of clause (23C) of section 10, as the case may be; and
(c) the said merger fulfils such conditions as may be prescribed.
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