Benefit of remuneration

[shyamal roychowdhury]

The Trust deed of my client provides that the trustees will be eligible for remunaration according to work performed by them & also will be entittled to reimbursement of expences incurred by them for works of trust. The trust is also registerd under income tax & also under trust act . Accordingly trusttes drew monthly remunaration decided by trustees in their meeting & drew reimbursement for conveyance & other expences incurred,. Now assessing officer has disallowed same as benefit to trustees which is against the act . so is not taking under application of fund . Can anyone throw some lighton this ?

[CAGOPALJI AGRAWAL]

Please see the provisions of section 13(2)(c).I think that the onus is on the assessee that the remuneration is reasonable and commensurate to the services rendered by trustees.

AI Summary

Trustees' Remuneration Disallowed as Benefit; Assessee Must Prove Reasonableness Under Section 13(2)(c) for Allowance. A query was raised regarding the disallowance of remuneration and expense reimbursements to trustees by an assessing officer, which was deemed a benefit against the act. The trust deed allows trustees to receive remuneration and reimbursement for their work, and the trust is registered under the income tax and trust act. A respondent advised reviewing section 13(2)(c) and suggested that it is the responsibility of the assessee to prove that the remuneration is reasonable and proportionate to the services provided by the trustees.