ICAI Releases New Technical Guide on Audit Reports Under Section 12A(10)(23C) of Income Tax Act

The Institute of Chartered Accountants of India (ICAI) Central Council through its Direct Taxes Committee has launched the Technical Guide on Reports on Audit under Section 12A10(23C) of Income-tax Act 1961 at the 426th Meeting of the Council held in New Delhi on 09.10.2023.

Every charitable or religious trust or institution claiming income not includible in total income under section 11 and section 12 or any fund or institution or trust or any university or other educational institution or any hospital or other medical institution claiming income not includible in total income under sub-clauses (iv)/(v)/(vi)/(via) of clause (23C) of section 10 (and the total income without giving effect to the beneficial/exemption provisions exceeds the maximum amount which is not chargeable to income-tax in any previous year) needs to keep and maintain the books of account and other documents as per Rule 17AA of the Income-tax Rules, 1962 and also get its books of account audited mandatorily under the Income-tax Act,1961.

This Technical Guide covers the provisions of section 10(23C) (iv)/(v)/(vi)/(via), Section 11 and 12 along with its allied rules. Along with audit reports in relation to Charitable Trusts & Institutions. The object of this Technical Guide is to provide guidance to the auditors for conduct of audit under section 12A and 10(23C).

This Technical Guide will also be useful for those in charge of governance of charitable institutions for discharging their respective responsibilities towards audit of accounts of charitable institutions under clause (b) of the tenth proviso to section 10(23C) and 12A(1)(b)(ii) of the Income tax Act.

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