TaxTMI 
TaxTMI 
2015 (9) TMI 189
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....is with regard to disallowance of income generated in the running of Working Women Hostel while computing the taxable income. 3. Sh. A. S. Sriraman, the Ld. Counsel for the assessee, submitted that the assessee-society is registered as charitable institution under Section 12A of the Income-tax Act, 1961 (in short 'the Act'). According to the Ld. counsel, the primary object of the assessee is education. In order to carry on the predominant object, the assessee was running a Working Women Hostel and the income was, in fact, applied for the purpose of carrying out the object of the institution. Therefore, according to the Ld. counsel, the assessee is eligible for exemption under Section 11 of the Act in respect of the income generated on runn....
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....ee was running any educational institution. Even though the Ld. Counsel claims that the assessee is providing funds to the students, it is not clear from the orders of the lower authorities whether such funds are provided by way of or scholarship or any other form of assistance. This Tribunal is of the considered opinion that the activity of the assessee-society has to be examined in the light of the Memorandum of the assesseesociety before examining the claim under Section 11 of the Act. It also needs to be examined whether the establishment of Working Women Hostel would fall under the head "public utility service" under Section 2(15) of the Act. Since these aspects were not examined by the authorities below and the facts are not clear fro....
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....itten Down Value is NIL, on allowing the entire cost as application of income under Section 11 of the Act, the computation itself fails. The Ld. D. R. has placed reliance on the judgment of the Apex Court in J. K. Synthetics Ltd. v. Union of India (1993) 199 ITR 43 and also the judgment of Kerala High Court in Lissie Medical Institutions v. CIT (2012) to taxmann. Com 9. 9. On the contrary, Sh. A. S. Sriraman, the Ld. Counsel for the assessee, submitted that the taxable income of the assessee has to be computed in a commercial form after allowing all permissible deductions under the provisions of Income-tax Act. According to the Ld. counsel, depreciation under Section 32 of the Act is an allowance that has to be deducted for arriving at tax....
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.... 11. Whereas, Section 32 of the Act, which provides for depreciation on capital asset falls under Chapter IV (D) of the Act. In fact, Chapter IV of the Act provides for computation of total income. Therefore, for the purpose of computation of total income, the expenditures provided in Sections 28 to 44DB of the Act have to be allowed depending upon the activity of the assessee. Section 32 of the Act which provides for depreciation is also falling in Chapter IV (D) of the Act. Therefore, for the purpose of computation of total income, depreciation has also to be allowed on the capital asset. In fact, depreciation has to be allowed on the value of the capital asset. This Tribunal is of the considered opinion that Chapter III of the Act deals....
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....ous year of acquisition and no depreciation could be allowed in that year. This is clear from the statute. Equally, it is not envisaged, and indeed, it would be meaningless to say, that depreciation could be allowed on them thereafter with a further absurdity that it could be allowed starting with the original cost of the asset despite its user for scientific research and the allowances made under the 'scientific research' clause. In our view, there was no difficulty at all in the interpretation of the provisions. The mere fact that a baseless claim was raised by some overenthusiastic assessees who sought a double allowance or that such claim may perhaps have been accepted by some authorities is not sufficient to attribute any ambiguity or ....
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.... Chapter IV under the head "C-Income from house property". Therefore while determining the "income" of the assessee trust and its "application of income" for the purpose of claiming exemption U/s.11(1)(a) of the Act, the provisions of Chapter-IV - Sections 22 to 27 of the Act which is applicable for computing the income chargeable to tax under the head 'income from house property' will not be attracted. However, provisions of section 22 to 27 of the Act will come into play when the assessee is not entitled to the benefit of Section-11(1)(a) of the Act and when such income of the Trust is chargeable to tax under the head "income from house property". It is pertinent to mention here that Hon'ble Calcutta High Court supra has held that income ....