Previously, the trustee could have sought condonation of the delay. If the Commissioner was satisfied about the reasons for the delay, he would have condoned the delay, in which case the registration was effective from the date of formation of the trust.
This position was changed by the Finance Act, 2007 from 01.06.07. The power of Commissioner of condonation of delay in making of application for registration is taken away. Now the trust filing delayed application, under any circumstances, will not be able to obtain registration from the date of creation. To become eligible from the date of creation, the trust will have to make an application for registration in the same financial year of creation. Now the one year time-limit from the date of creation within which the trust could so far make such application is also removed. New registration, from the date of creation or from the first day of financial year in which year the application has been moved, will be granted.
Supposing a trust was formed on 1st March, 2011 and the application for registration is submitted on 31st. December, 2012, the benefits of sections 11 and 12 will be made available with effect from 1st April 2012.