2013 (9) TMI 869

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....te Bench had admitted the appeal on the following substantial question of law:- "Keeping in view the facts recorded by the Tribunal in favour of the assessee granting exemption under Section 11 of the Income Tax Act, 1961 is correct and not violative of provision contrary to sub Section (3) of Section 13 of the Act being fund alleged to used for personal benefit." The brief facts of the case are that the assessee is a registered trust which was established on 16.07.1994. Sri Tariq Anwar Khan is the author and founder secretary of the trust, and Sri Zaheer Ahamd Siddiqui is the founder President/Life Member Trustee of the Trust. Since 2002, the assessee-trust is registered under Section 12 A of the Act. This case has a long history ....

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....loans were distributed to needy and poor persons. The loans were provided on surety of ornaments or in some cases personal surety. While going through books of account pertaining to "Qarz-E-Hasan Scheme" it was noticed that a sum of Rs.40,000/- was claimed on account of electricity bill; and a sum of Rs.22,000/- for office rent. The electricity bill was paid by cheque on 31.03.2002 for the premises which was partly used by the society for official purpose. The building is owned by Sri Zaheer Ahmed Siddiqui. Learned counsel further submits that the rent receipt of Rs.22,000/- was furnished before the lower authorities. The tenancy agreement was executed on 01.04.2001, between the owner i.e. President of the trust and the assessee trust. I....

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....ancy agreement dated 01.04.2001. Accordingly, the assessee-trust was liable to pay rent for administrative office and "Qarz-E-Hasan Scheme" office. The rent of Rs.4000/- per month is reasonable. With regard to the electricity expenses, learned counsel submits that incurring of the expenses had not been doubted and expenses were incurred for the premises which was used for conducting the charitable activities, so, it was an allowable expenditure. In the past assessment years, the department has allowed the said expenditure. The benefit of section 11 is given by the department in subsequent assessment years. But wrongly the same was denied for the assessment year under consideration. After hearing both the parties and on perusal of the ....