Tax Exemptions For Charitable And Religious Trusts Under Sections 11 To 13: A Critical Appraisal
- IJLLR Journal
- 1 day ago
- 1 min read
Aparna T, BA LLB (Hons), Chettinad School of Law
Darshanram Karthik S, BA LLB (Hons), Chettinad School of Law
Mrs. Jehibha N, Assistant Professor of Law, Chettinad School of Law
ABSTRACT
The Indian Income Tax Act, 1961 accords significant tax exemptions to charitable and religious trusts under Sections 11 to 13, reflecting the legislature’s intent to encourage philanthropy and social welfare. However, the operation of these provisions has often sparked debate over their scope, misuse, and alignment with the principles of equity and fiscal accountability. This paper critically appraises the legal framework governing tax exemptions for charitable and religious trusts, analyzing statutory provisions, judicial interpretations, and administrative practices. It examines the conditions for eligibility, application of income, accumulation rules, and the restrictions imposed on private religious purposes and benefit to specific communities. The study highlights the judicial trend of balancing legislative intent with the prevention of abuse of tax privileges. Drawing from landmark decisions of the Supreme Court and High Courts, it evaluates whether the current framework effectively distinguishes genuine charitable activity from tax avoidance mechanisms. The paper concludes with suggestions for reform aimed at ensuring transparency, accountability, and equitable application of tax exemptions in harmony with public policy objectives.
Keywords: Income Tax Act, 1961, Sections 11–13, charitable trusts, religious trusts, tax exemption, fiscal accountability, judicial interpretation.
