2017 (1) TMI 395

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....the Income Tax Act, 1961 (in short 'the Act') vide order dated 31/10/2011; wherein the income was assessed at Nil, thereby disallowing the carry forward of the loss of Rs. 45,85,501/- as claimed buy the assessee, by treating the same as excess application of loss u/s.11 to the subsequent years as there is no provision to allow the same. 2.2. Aggrieved by the order of assessment dated 31/10/2011 for A.Y.2009-10 to the assessee preferred an appeal to the CIT(A) - 1, Mumbai on this issue. The learned CIT(A) allowed the assessee's appeal vide the impugned order dated 05/02/2015, following the decision of the Hon'ble High Court of Bombay in the case of CIT v. Institute of Banking Personnel Selection (2003) 264 ITR 110 (Bombay). 3.1. Revenu....

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....e assessee placed strong reliance on the impugned order of the learned CIT(A). According to the learned AR, the issue in question, as raised in revenue's grounds (supra) is covered squarely in favour of the assessee by the decision of the jurisdictional High Court in the case of CIT v Institute of Banking Personnel Selection (supra), and has also been followed by decision of the Tribunal in the case of ACIT v Mandke Foundation (ITA No.3837/Mum/2015 dt.29/02/2016.) 3.3.1. We have heard the rival contentions and perused and carefully considered the material on record, including the judicial pronouncements cited. The issue raised by Revenue in this appeal is with regard to the decision of the learned CIT(A) in directing the AO to allow the ....

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....ess" under section 28 in which the provision for carry forward of losses was relevant. That, in the case of a Charitable Trust, there was no provision for carry forward of the excess of expenditure of earlier years to be adjusted against income of subsequent years. We do not find any merit in this argument of the department. Income derived from the trust property has also got to be computed on commercial principles and if commercial principles are applied then adjustment of expenses incurred by the Trust for charitable and religious purposes in the earlier years against the income earned by the Trust in the subsequent year will have to be regarded as application of income of the Trust for charitable and religious purposes in the subsequent ....