The government has exempted 165 District Mineral Foundation Trusts (DMF), from Income Tax payment. Through the amendment in Mines & Minerals (Development & Regulation) (MMDR) Act, in 2015, the Government of India has made provision for the establishment of a District Mineral Foundation in all the districts affected by mining. The object of the District Mineral Foundation is to work for the interest and benefit of persons, and areas affected by mining-related operations in such manner as may be prescribed by the State Government. So far, DMFs have been set up in 600 districts over 22 States in the country which have framed DMF rules.
A Gazette Notification No. 103/2021 in S.O. 3659(E) for Income-tax exemption u/s 10(46) of the Income-tax Act, 1961 in respect to the District Mineral Foundations has been issued to this effect on 10th September 2021 by the Ministry of Finance (Department of Revenue) (Central Board of Direct Taxes). Ministry of Mines has taken up with the Ministry of Finance regarding the issuance of notification.
Ministry of Finance has taken measures to get the DMF trust exempted from Income Tax. Section 10(46) of the Act was amended by Finance Act 2018 so that all the DMF Trusts could be notified as ‘Class of Authority’. Accordingly, the Ministry of Finance, Department of Revenue on 10.09.2020 vide Notification No. 73/2020 notified 151 ‘District Mineral Foundation Trust’ and on 10.09.2021 notified 165 DMFs as ‘class of Authority’, in respect of the income arising to DMF. Hence Total 316 District Mineral Foundation Trust have been notified as ‘class of Authority’ in respect of the income arising to DMF on account of contributions by leaseholders to DMF as per the MMDR Act, interest on late payment of DMF contributions by miners and such other specified collections.
Read the full text of Notification No. 103/2021 dated 10.09.2021 on income-tax exemption to District Mineral Foundation Trust
MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
NOTIFICATION
New Delhi, the 10th September, 2021
S.O. 3659(E).—In exercise of the powers conferred by clause (46) of section 10 of the Income-tax Act, 1961 (43 of 1961), the Central Government hereby notifies for the purposes of the said clause, ‘District Mineral Foundation Trust’ as specified in the schedule to this notification, constituted by Government in exercise of powers conferred under section 9(B) of the Mines and Minerals (Development and Regulation) Amendment Act, 2015 (10 of 2015) as a ‘class of Authority’, in respect of the following specified income arising to that Authority, namely :-
(a) Contribution by lease Holder to DMF as per the Mines and Minerals (Contribution to District Mineral Foundation) Rules, 2015;
(b) Interest received from lease holders for late payment;
(c) Any Penalty charged to lease holder;
(d) Income from Interest on fund available under DMF;
(e) Interest received on Saving Bank Accounts; and
(f) Interest received on Excess Fund invested in Term Deposit.
2. This notification shall be effective subject to the conditions that each of the District Mineral Foundation Trust-
(a) shall not engage in any commercial activity;
(b) activities and the nature of the specified income shall remain unchanged throughout the financial years; and
(c) shall file return of income in accordance with the provision of clause (g) of sub-section (4C) of section 139 of the Income-tax Act, 1961.
(d) shall file the Audit report along with the Return, duly verified by the accountant as provided in explanation to section 288(2) of the Income-tax Act, 1961 along with a certificate from the chartered accountant that the above conditions are satisfied.
3. This notification shall be deemed to have been applied for the financial years 2017-2018, 2018-2019, 2019-2020, 2020-2021 and shall apply with respect to the financial year 2021-2022 in respect of Trusts mentioned in column (2) of the below mentioned schedule.
SCHEDULE
[Notification No. 103/2021 F. No.300196/36/2017-ITA-I]
SOURABH JAIN, Under Secy.
Explanatory Memorandum
It is certified that no person is being adversely affected by giving retrospective effect to this notification.
Download CBDT Notification No. 103/2021 dated 10.09.2021 on income-tax exemption to District Mineral Foundation Trust in pdf format
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