TaxTMI 
TaxTMI 
2015 (11) TMI 645
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....10.2007 disclosing nil income. In the computation of income assessee showed income from property held under trust amounting to Rs. 22,11,76,304/- and reduced therefrom amount spent during the previous year of Rs. 18,02,20,722/- leaving surplus of Rs. 4,09,55,582/-. For this amount assessee submitted declaration under explanation 2B of Section 11(1)(B) submitting that since the assessee has not been able to utilized 85% of its receipts towards its objects a resolution was submitted for accumulation of income. Subsequently form no. 10 was submitted for accumulation. The main purpose for which the amount is accumulated and set a part was for promotion of fashion industry in India. Ld. AO denied the benefit of accumulation of surplus for the fo....
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....decision of Hon'ble Supreme court in Escorts Ltd. vs. Union of India 199 ITR 43 holding that it is double deduction dismissed the appeal of the assessee. Aggrieved with the order of CIT (A) assessee is in appeal before us. 04. Before us ld. AR submitted that the object of the trust of the assessee are listed in the memorandum of association of the trust the objects of the trust are divided into main objects and ancillary objects. In form no. 10 the assessee has submitted the object for accumulation is to promote fashion design in India. She submitted that it is one of the specific object of the trust and therefore the finding of the CIT (A) that it is not specific object is not correct. She submitted that form no. 10 is submitted before ....
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....30th October, 2007 along with a resolution dated 25th October, 2007. Vide letter dated 21st December, 2009 in response to notice u/s 143(2) of the Income Tax Act assessee submitted form no. 10 for accumulation of the income. In form no. 10 and in resolution the objects for which the accumulation was to be set a part were as under : "(1) to promote the fashion industry etc. (2) To take such other steps as the trustees consider as being in tune with the aforesaid objective of the trust." We have perused the Memorandum of the Assessee association where in the objects of the trust are defined under the heading of main object and ancillary object. The main object of the trust includes provision of effective forum for representation on t....
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....mitted at any time before the assessment is completed same should be considered as valid compliance of law. Admittedly in this case assessee has submitted the form No 10 before the completion of assessment proceedings therefore no fault can be found with the assessee. Therefore we are of the view that the form no. 10 submitted by the assessee before completion of assessment proceedings and is having the specific objects therefore trust is entitled for the accumulation of income. Hence, ground no. 1 of the appeal is allowed. 07. Regarding second ground of appeal about the allowability of depreciation AO has disallowed the depreciation claimed by the assessee trust of Rs. 638652/- on the ground that once the assets are acquired assessee ha....
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....e judgments of the Karnataka, Maharashtra and Madhya Pradesh High Courts cited above, also came to the same conclusion and held that the amount of depreciation debited to the accounts of the charitable institution has to be deducted to arrive at the income available for application to charitable and religious purposes. 13. The judgment of the Supreme Court in Escorts Limited (supra) has been rightly held to be inapplicable to the present case. There are two reasons as to why the judgment cannot be applied to the present case. Firstly, the Supreme Court was not concerned with the case of a charitable trust/institution involving the question as to whether its income should be computed on commercial principles in order to determine the amou....