2016 (6) TMI 1345

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....thout appreciating the fact that this would have the effect of granting double benefit to the assessee, first as 'accumulation' of income u/s 11(1)(a) or as corpus donation u/s 11(1)(d) in the earlier years or current year and then as 'application' of income u/s 11(1)(a) in the current or subsequent years which was legally not permissible. 2. That on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in allowing the claim of the assessee for carry forward of the said deficit, ignoring the fact that there was no express provision in the I T Act, 1961 permitting allowance of such claim. 3. The Appellant prays that, to the extent of above grounds, the order of the Commissioner of Income- Tax (Ap....

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.... Institute of Banking Personnel Selection (IBPS)(supra). We have seen that Ld. CIT(A) while allowing the appeal of the assessee made the followed observations: "I have carefully considered the submissions of the appellant, assessment order and facts of the case. I find that the appellant's claim of setting off the excess of income over expenditure against the deficit of earlier year is correct in view of the decision of Hon'ble Rajasthan High Court in the case of CIT v/s Maharashtra of Mewar Charitable Foundation (1987) 60 CTR (Raj) 40 : (1987) 164 ITR 439 (Raj) which was followed in CIT vs. Shri Plot Swetamber Murti Pujak Jain Mandal 211 ITR 293 (Guj.). Therefore, this ground of appeal is allowed." 4. We have gone through the decision o....

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....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 year in which adjustment has been made having regard to the benevolent provisions contained in section 11 of the Act and that such adjustment will have to be excluded from the income of the Trust under section 11(1)(a) of the Act. Our view is also supported by the Judgment of the Gujarat Hi....