2021 (6) TMI 143

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....d 22963 & 22965 of 2018 - -<br>Income Tax<br>Honourable Mr.Justice G.R.Swaminathan For the Petitioner : Mrs.N.Krishnaveni Senior Counsel for Mr.P.Thiyagarajan For the Respondents : Ms.M.Parameswarifor Mrs.S.Srimathy Standing Counsel COMMON ORDER Heard the learned senior counsel appearing for the petitioners and the learned standing counsel appearing for the Income Tax Department. 2.....

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.... found during the survey. Therefore, the impugned notices were issued calling upon the respective Trustees to show cause as to why the exemptions claimed by the Trusts under Section 11 of the Act should not be denied in these cases, as the payment out of income from property held under Trusts have been paid directly for the benefit of persons referred to sub section (3) of Section 13 of Income Tax....

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.... appearing for the petitioner submitted that the petitioners / Trusts have been constrained to move this Court at the show cause notice stage itself, because the impugned notices threatened to cancel the primary exemption enjoyed by the Trusts. She would point out that the impugned show cause notices are not in consonance with the circular issued by the Department. She drew my attention to Circ....

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....rtue of the provisions of the Income-Tax Act in regard to investment pattern or use of the trust property for the benefit of the settlor, etc, contained in Section 13(1)(c) and (d) of that Act, the said rate will not apply to the business profits of such trusts which are otherwise chargeable to tax. In other words, where such a trust contravenes the provisions of Section 13(1)(c) of (d) of the Act....