TaxTMI 
TaxTMI 
2011 (2) TMI 1568
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....heard the same together and disposing both of them by this common order, for the sake of convenience. 2. First we will take up the appeal filed by the Revenue. The Revenue raised the following grounds of appeal: 1. The learned CIT(A) ignored the crucial fact that the society adopted double standards by showing one value to the municipal authorities and another value to the I.T. Dept. Quite against the settled law that such sub-standard conduct should not be taken judicial notice of. 2. The learned CIT(A) failed to appreciate the fact that the assessee grossly acted against one of the certificates given by itself at the time of registration before the Registrar of the Societies th....
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....the income of the trust, diverted directly for the benefit of the president was covered by section 13(3)(cc) being Rs. 1,14,000 which is more than the tolerance limit of Rs. 1,000 stipulated in section 13(2)(g). Accordingly the Assessing Officer issued a notice dated 24.12.2008 to the assessee to show cause as to why the claim u/s. 11 should not be rejected. 5. In response a detailed reply dated 29.12.2008 was filed before the Assessing Officer. It was contended by the assessee that the payment of rent by the society is very nominal amounting to only 12% of the market value saving 88% to the society and the property was let out on nominal rent basis and not on commercial basis. It was conte....
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....rt in Agappa Child Centre vs. CIT (226 ITR 211) where exemption was denied for purchase of a refrigerator that was kept in the house of managing trustee and was held as used by an interested person. The Assessing Officer also relied on the decision of ITAT in Society for Integrated Development in Urban and Rural Areas (SIDDUR) vs. DCIT (90 ITD 493) and the decision of jurisdictional High Court in AWARE (263 ITR 43). The Assessing Officer felt that the payment of rent of Rs. 1.14 lakhs constituted benefit to the interested person. He observed that the Board circular as referred by the assessee is not relevant while considering the strict applications of fiscal provisions contained in the tax statutes. Accordingly, the....
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.... effect a decade ago and the trust is not paying anything more than the reduced amount which is far less than the market rent as evidenced by the certificate of the valuer. 8. The CIT(A) observed that the Assessing Officer has not brought any evidence to show the correct rental value as on date or to refute the value as shown by the Government valuer. The argument of the assessee that the rent collected is very nominal cannot be disputed even as per the information obtained from the municipal authorities and anything over and above the adequate consideration/market rent/standard rent was passed to the specified person in the garb of a commercial transaction of taking property on rent from the pre....
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....th March, 2010. ii. The order of Andhra Pradesh High Court in the case of M/s. New Noble Educational Society, Hyderabad in W.P. Nos. 21248, 21252, 21257, etc. order dated 11.11.2010 (copy enclosed). 11. We have considered the rival submissions on either side and also perused the material on record. The purpose of section 13(1)(c) is to deprive a religious or charitable trust from exemption if it is found that its income is used or applied, directly or indirectly, for the benefit of the specified persons. Section 13(1)(c) carves out a general exception wherein the provisions of sections 11 and 12 will not operate on account of user or application of any income of the trust for any direct or indirect benefi....