July 05, 2006	Wednesday	Jumadi-ul-Sani 8, 1427

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ISLAMABAD, July 4: The Central Board of Revenue (CBR) has notified new rules empowering commissioner of income tax to withdraw income tax exemption granted to any non-governmental organization (NGO) if it does not fulfil certain conditions.

The new rules were notified through income tax notification SRO 667 of 2006 by amending the income tax rules 2002.

According to amendments, the approval granted by commissioner would remain in force for the subsequent years unless it was withdrawn.

According to the new powers granted to commissioner, the exemption order could be withdrawn at any time, if the commissioner was satisfied: a) the constitution, memorandum and articles of association, trust deed, rules and regulations or bye-laws, as the case may be, specifying the aims and objects of the organization do(es) not provide for prohibiting the making of any changes in the constitution, memorandum and articles of association, trust deed, rules, regulations and bye-laws without prior approval of the Commissioner; b) the organization has- i) been or is being used for personal gain of any particular person or a group of persons as specified in clause (a) of sub-rule (2) of rule 213; ii) been propagating the view of a particular political party or a religious sect as specified in clause (b) of sub-rule (2) of rule 213; iii) been or is being managed in a manner calculated to personally benefit its members or their families as specified in clause (c) of sub-rule (2) of rule 213; or iv) not been or will not be able to achieve its declared aims and objects in view of its set up, administration or otherwise as evaluated and certified by an independent certification agency as specified in clause (d) of sub-rule (2) of rule 213; v) failed to give valid reasons for setting apart, or not utilising, or accumulating surpluses, excluding unrestricted funds, in excess of twenty five percent of the income for the year.

The approval to those NGOs can also be withdrawn if they failed to file the return of income supported with following documents; a) the statement of audited balance sheet and statement of accounts as mentioned in clause (d) of sub-rule (2) of rule 211; b) statement showing names and addresses of the persons from whom donations, contributions, subscriptions etc exceeding Rs5,000 have been received during the tax year; c) statement showing the names and addresses of donees and beneficiaries, etc., to whom payments, services, etc., exceeding Rs5,000 have been made during the tax year; and d) statement showing the money set apart or kept un-utilised with reasons thereof; vii) failed to provide a detailed performance evaluation report in terms of clause (g) of sub-rule (2) of rule 211, after every three years.

Approval shall not be withdrawn under sub-rule (1) unless the organization has had an opportunity to show cause against the action proposed to be taken.