Industry

Income Tax Department cancels registration of six Tata Trusts

Bombay House where offices of Tata Trusts are located. File

Bombay House where offices of Tata Trusts are located. File   | Photo Credit: The Hindu

Gave up registration voluntarily in 2015, say the Trusts; “This means a loss of thousands of crores as all Tata Sons profits were given to Tata Trusts as dividends”.

The Office of the Principal Commissioner of Income Tax, Mumbai, has cancelled the Income Tax registration of six Tata Trusts, namely Jamsetji Tata Trust, R.D. Tata Trust, Tata Education Trust, Tata Social Welfare Trust, Sarvajanik Seva Trust, and Navajbai Ratan Tata Trust by its order dated October 31, 2019.

“The Trusts would like to clarify that this order of cancellation is a culmination of the decision taken by these six Trusts in 2015 to surrender, of their own volition, their registration under the Income Tax Act and to not claim the associated income tax exemptions,” said a Tata Trusts statement. It added that the decision to surrender the registration was taken in the best interests of the Trust and to maximise the resources available to the Trust for their charitable work which is the principal object and focus of the Trusts.

“While the Tax Department’s order has cancelled the Trusts’ registration with immediate effect, we believe that as a matter of law and consistent with the Department’s own decision in the past, the cancellation should take effect from 2015, when the registrations were surrendered and the Trusts themselves consented to cancellation,” it said.

The Trusts are examining the order and will take ‘next steps in accordance with the law’. The Trusts have effective legal options to vindicate their grievances against today’s order both factually and legally.

“We would also like to clarify that Trusts have not received any demand notice from the Income Tax Department pursuant to the cancellation order, as has been speculated in certain sections of the media. It is equally surprising how the issue of seizure of the Trusts’ assets has been raised today,” said the statement.

When asked for comments, investment adviser S.P. Tulsian told The Hindu, “Something was cooking, so the Tata Trusts managing trustee resigned.

“This means Tata Trusts will not be able to enjoy the benefits of income tax exemptions of being a trust any further and this means a loss of thousands of crores as all Tata Sons profits were given to Tata Trusts as dividends.”

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Printable version | Feb 20, 2020 8:58:25 AM | https://www.thehindu.com/business/Industry/income-tax-department-cancels-registration-of-six-tata-trusts/article29857189.ece

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