TaxTMI 
TaxTMI 
2015 (12) TMI 1762
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.... same set of facts in issue, therefore, they were heard together and disposed of by this common order for the sake of convenience. 2. As a registered Trust, assessee is engaged in various philanthropic activities as per Trust Deed. Pursuance to a search and seizure operation carried out against Chandbibi group on 20/08/2009, assessee's case was re-opened by issuing notice under section 148 of the Income Tax Act,1961(in short 'the Act'). The reasons for reopening the assessment and the satisfaction note alongwith approval of the Commissioner were handed over to the assessee. Vide a letter dated 7/4/2010 assessee requested to treat the earlier income as returned in compliance to the notice. 3. While scrutinizing the return of income the Ass....
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.... such repairs of a building, which was not owned by the assessee, the Assessing Officer added back the entire expenditure of Rs. 30,71,330/-. Since the exemption under section 11 was denied, the corpus donation of Rs. 30,49,279/- was also added back. 3.2 Aggrieved by this, the assessee carried the matter before the CIT(A) and vehemently submitted that the assessee is very much entitled for the claim of exemption and it is an erroneous assumption that the assessee is hit by the provisions of section 13(3) of the Act. It was stated before the CIT(A) that the assessee has not violated any conditions of Section 11 r.w.s. 13 of the Act and, therefore, denial of exemption is bad in law. After considering the facts and the submissions, the CIT(A)....
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....re affiliates of the assessee, therefore, money given to these unions were as per the objects of the Trust. Ld. Counsel for the assessee vehemently stated that even if the assessee has violated the provisions of Section -13, then the correct section is Section 13(1)(d) and not 13(1)(c) of the Act and, therefore, only income from such investment or deposit made in violation of Section 11(5) is liable to be taxed and that violation under section 13(1)(d) of the Act does not tantamount to denial of exemption under section 11 of the Act on total income of the assessee and since the assessee has not received any interest from the loans given to two Mazdoor Sabhas, there is no income liable to be taxed. Reliance was placed on the decision of the ....
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....s purposes or a charitable or religious institution, any income thereof- (i) if such trust or institution has been created or established after the commencement of this Act and under the terms of the trust or the rules governing the institution, any part of such income enures, or (ii) if any part of such income or any property of the trust or the institution (whenever created or established) is during the previous year used or applied, directly or indirectly for the benefit of any person referred to in subsection (3): Provided that in the case of a trust or institution created or established before the commencement of this Act, the provisions of sub- clause (ii) shall not apply to any use or application, whether directly or indirectly....
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....author, founder, person, 5 member, trustee or manager] as aforesaid; (e) any concern in which any of the persons refer- red to in clauses (a), (b), (c) 6 , (cc)] and (d) has a substantial interest." A perusal of this section, qua the chart exhibited elsewhere clearly show that the Trustees have been benefited directly or indirectly clearly violating the conditions. 6.1 The claim of the Ld. Counsel is that it is covered by the provisions of section 13(1)(d) of the Act. The relevant portion of the said section read as under:- Section-13(1)(d):- " (d) 1 in the case of a trust for charitable or religious purposes or a charitable or religious institution, any income thereof, if for any period during the previous year- (i) any funds of ....