2021 (8) TMI 924

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....case and in law, Ld. CIT (A) was correct in allowing the carry forward of deficit of Rs. 6,40,70,201/- and ignoring the fact that in case of an assessee registered u/s 12A of the Act, its total income is required to be computed in accordance with section 11,12 & 13 of the Act and provision of these sections do not envisage set-off of deficit/loss/excess expenditure of earlier assessment year? ii) The appellant craves leave to add, to alter or amend any ground of appeal raised above at the time of hearing." 3. Briefly stated the facts of the case are that the assessee society is registered u/s 12A of the Income-tax Act vide order F.N.DIT(E)/2009-10/Del-IR20110-10072009/453 dated 10.07.2009. It is also registered u/s- 80G(5)(vi) v....

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....rongly supported the findings of the AO. It is the say of the DR that there is no provision in the Act with regard to trust which allows for determination of loss u/s.11, carry forward of the same the subsequent years to be set off against incomes of the subsequent years. The Counsel strongly supported the findings of the CIT(A). 8. We have given a thoughtful consideration to the orders of the authorities below. The Hon'ble Delhi High Court in the case of Raghuvanshi Charitable Trust 971 taxman 170 held as under :- 8. It would be fruitful to refer to the discussions contained in Institute of Banking Personnel Selection (IBPS)'s case (supra), Per Hon'ble Mr. justice S.H. Kapadia, which is advanced before us by the learned....

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.... 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 the 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 High Court in the case of CIT v. Shri Plot SwetamberMurtiPujak Jain Mandal [1995] 211....