1988 (11) TMI 15

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.... or Rs. 10,000, whichever was higher, was to be invested in Government securities in view of section 11 of the Income-tax Act, 1961, and not the entire amount of accumulation ?" We are concerned with the assessment years 1966-67 and 1967-68. For the assessment year 1967-68, the assessees claimed refund of tax deducted at source. The Income-tax Officer did not dispute that the assessees, as trustees of a charitable trust, were entitled to claim exemption under section 11. He disputed the contention of the assessees that they had made an investment which was sufficient compliance with the requirement of clause (b) of sub-section (2) of section 11. The assessees had given a notice as required by clause (a) of sub-section (2) and had investe....

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.... thereof, came to the conclusion that the Income-tax Officer and the Appellate Assistant Commissioner were in error and allowed the appeals. The relevant portions of section 11, as they read at the relevant time, are these : "(1) Subject to the provisions of sections 60 to 63, the following income shall not be included in the total income of the previous year of the person in receipt of the income (a) income derived from property held under trust wholly for charitable or religious purposes, to the extent to which such income is applied to such purposes in India; and, where any such income is accumulated for application to such purposes in India, to the extent to which the income so accumulated is not in excess of twenty-five per cent.....