2021 (8) TMI 204

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....u/s. 10(34) to the tune of Rs. 3,43,55,850/-, when this income forms a part of the income from property held under trust and therefore can only be claimed to be exempt u/s. 11, if applied for charity and not u/s. 10 of the Income Tax Act,1961?" 2. "Whether on the facts and circumstances of the case, the Ld. CIT(A) was right in replying on the judgment of Hon'ble Bombay High Court ITAT in the case of DIT(E) Vs. Jasubhai Foundation 374 ITR 315 (Bom) which is distinguishable to the facts of the assessee's case as in the above case, exemption u/s. 11 is denied to the assessee due to the violation of section 13(1 )(d) of the Income Tax Act, 1961, even through the Income Tax Department has not filed SLP before Hon'ble Supreme....

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....,390 2,83,80,575 NRC Ltd. Equity Rs. 10 Each 13,950 13,26,535     Total 6,35,42,115 The AO contented that the assessee had invested in prohibited mode of investment and violated the provisions of Section 13(1)(d) r.w.s 11(5) of the Income Tax Act and section 13(2)(h) of the Income tax act, 1961. Further it was seen by the AO that assessee was in receipt of Dividend of Rs. 3,43,55,850/- and same had been claimed as exempt u/s. 10(34) of the l.T.Act. The AO further discussed the issue on charging the income of the assessee's trust as per provisions of Section 164(2) of the Act. Since no exemption u/s. 11 was allowed to the assesse on dividend on shares of Rs. 3,43,55,850/- and income was taxed at ma....

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....elied on the judgement of Hon. ITAT, Mumbai dt. 26.03.2014 in the case of Jamsetji Tata Trust vs. JOIT (E) Range - II 148 ITO 3SSwherein the Hon. ITAT while dealing with the same issue have observed as under:- "in our view the exemption u/s 11 is available on the income of the public charitable/ religious trust or institution which is otherwise taxable in the hands of other persons. Thus the income which is exempt u/s 10 cannot be brought to tax by virtue of sections 11 and 13 of the Act because no such pre condition is provided either u/s 10 or 11 to 13 of Income-tax Act. Therefore, section 11 to 13 would not operate as overriding affect to the section 10 of the Act. The language of these provisions does not suggest that ....

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....0 deals with incomes not included in total income whereas section 11 deals with income from property held for charitable or religious purposes. We have not found anything in the language of the two provisions nor was Mr. Malhotra able to point out as to how when certain income is not to be included in computing total income of a previous year of any person, then, that which is excluded from section 10 could be included in the total income of the previous year of the person/assessee. That may be a person who receives or derives income from property held under trust wholly for charitable or religious purposes. Thus, the income which is not to be included in computation of the total income is a matter dealt with by section 10 and by section 11....

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....operty held for charitable or religious purpose is not a matter covered or dealt with by Section 10 that the Tribunal's view cannot be termed as perverse or clear language of these provisions enables us to uphold the order of the Tribunal. It is, accordingly, upheld. The Revenue's appeal does not raise any substantial question of law." The AO has also sought to argue that in the case of Jasubhai Foundation (supra), the assessee therein was granted benefits of section 11 whereas in the Ccise of the appellant, the benefits of section 11 have not been granted and hence the same is not applicable. In my opinion, the fact that benefits of section 11 have not been granted to the appellant further strengthens its claim for exempti....