TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Tribunal Grants Partial Relief to Charitable Trust, Allows Carry Forward of Surplus Income for Future Charitable Use.</h1> <h3>Lions Comprehensive Eyecare Foundation Versus ITO, Exemption Ward, Kolhapur.</h3> Lions Comprehensive Eyecare Foundation Versus ITO, Exemption Ward, Kolhapur. - TMI Issues involved:The issues involved in the judgment are the denial of exemption u/s 11 of the Income Tax Act, 1961 by the Assessing Officer, disallowance of 10% of revenue expenditure, and the appeal filed by the assessee before the Tribunal challenging the order of the National Faceless Appeal Centre (NFAC).Denial of Exemption u/s 11:The assessee, a charitable trust registered u/s 12A of the Act, filed a return of income for A.Y. 2016-17 claiming exemption u/s 11. However, the Assessing Officer completed the assessment u/s 144, denying the exemption on the ground that the trust did not have registration under 12A/12AA of the Act. The NFAC allowed the exemption u/s 11 but confirmed the disallowance of 10% of the revenue expenditure as the genuineness was not proven. The Tribunal admitted an additional ground of appeal related to the quantum of ad-hoc disallowance of expenses and surplus income, ultimately allowing the appeal partially.Disallowance of Revenue Expenditure:The AO disallowed 10% of the revenue expenditure as the genuineness was not proven by the assessee. The NFAC upheld this disallowance. The Tribunal, after considering submissions from both sides, found merit in the argument that disallowance of revenue expenditure would only inflate the surplus income of the trust. Since the surplus income did not exceed 15% of the total receipts, it was to be carried forward for subsequent charitable purposes, leading to no addition being called for. The additional ground of appeal was allowed, and other grounds were dismissed as infructuous.Conclusion:The Tribunal partially allowed the appeal of the assessee, emphasizing that the disallowance of revenue expenditure would only impact the surplus income of the trust, which could be carried forward for charitable purposes as it did not exceed 15% of the total receipts. The judgment was pronounced on 15th February 2024.
TaxTMI 
TaxTMI 
