TaxTMI 
TaxTMI 
2022 (8) TMI 20
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.... of the other cross appeals also. The lead case, we take into consideration is (ITA. No.3152/Mum/2018) M/s. Tata Social Welfare Trust for A.Y.2012-13. 3. First of all, will deal with the revenue appeal ground nos. 1, 2 & 4 which reads as under: - "1."On the facts and circumstances of the case and in law, the Ld CIT(A) erred in allowing exemption u/s.10(34) of the Income tax Act to the tune of Rs.12,06,15,478/-. On the dividend income without appreciating the fact that the income derived by the assessee trust is from the properties held under the trust and claimed exemption u/s.11 of the I T Act which is denied by the AO due to violation of provisions of section 13(1)(d) and 13(2)(h) of the Act. The violation of section 13 has not changed the status of the Trust i.e, from being Trust to private person. The violation of section 13 has not changed the nature of the income i.e. from being the income J) derived from the property held under Trust to Private Income. The violation " u/s.13 has changed only the eligibility of exemption of income derived from property held under Trust, u/s.11. The assessee claimed alternative exemption u/s.10(34) which was not allowed by the AO because se....
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....he Ld. AR drew our attention to the decision of Tribunal in assesses Group trust case i.e. M/s. Navajbhai Ratan Trust (ITA. No.1301/Mum/2018 for A.Y.2011-12), ITA. No.1316/Mum/2018 for A.Y.2011-12, ITA. No.1302/Mum/2018 for A.Y.2012-13, ITA. No.1314/Mum/2018 for A.Y.2012-13, ITA. No.2115/Mum/2018 for A.Y.2013-14, ITA. No.2161/Mum/2018 for A.Y.2013-14, ITA. No.2116/Mum/2018 for A.Y.2014-15 & ITA. No.2162/Mum/2018 for A.Y.2014-15 wherein the cross appeals/appeal preferred by the revenue has been dismissed by this Tribunal by order dated 10.03.2022 wherein similar grounds appeal was raised by the revenue for A.Y.2011-12 which reads as under: - "(i) On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in allowing exemption u/s.10(34) of the Income tax Act to the tune of Rs.115,47,80,338/- on the dividend received on shares without appreciating the fact that the income derived by the assessee trust is from the properties held under the trust and claimed exemption u/s. 11 of the I.T. Act. (ii) On the facts and circumstances of the case and in law, the Ld CIT(A) erred in allowing exemption u/s.10(34) of the Income tax Act to the tune of Rs. 115,47,80,338/- on th....
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....ith regard to the claim of exemption under section 10(34) of the Act on dividend income received on shares by the assessee. 11.1 The brief facts of the case pertaining to this issue as emanating from record are: During the year under consideration, the assessee trust had received dividend income of Rs. 115,47,80,338 which was claimed as exempted under section 10(34) of the Act. 11.2 The AO vide order dated 18.03.2014 held that the assessee trust is not entitled to claim exemption under section 10(34) as assessee's entire income derived from the property held under trust is governed by the provision of section 11 of the Act. The AO further held that once there is violation under section 13 and as a result of same, exemption under section 11 is denied, assessee cannot claim alternative exemption under section 10(34) because section 10(34) of the Act does not deal with income derived from property held under trust. 11.3 In appeal against the aforesaid disallowance, the CIT(A) vide order dated 18.12.2017 following the decision of Hon'ble Jurisdictional High Court in the case of DIT (Exemption) v. Jasubhai Foundation: 374 ITR 315, interalia, allowed the appeal of the assessee and ....
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....A) allowing the claim of exemption u/s 10(34) of the Act and dismiss the ground nos. 1, 2 & 4 of the revenue appeal. 8. Coming to the ground no. 3 of revenue which reads as under: - "3 On the facts and circumstances of the case and in law, the Ld. CIT(A) erred in allowing exemption u/s 11 with respect to the interest income and other income of Rs.3,22,98,856/- without appreciating the fact that the main purpose of the trust is defeated as there is violation to the provision of section 13(1)(d) and 13(2)(h) of the Act." 9. In respect of the aforesaid ground of appeal of the revenue, the Ld. AR drew our attention to the page no. 10 of the same order (supra) wherein this Tribunal has up held the action of Ld. CIT(A) and thus held in favour of the assessee by holding as under: - "6. The next issue to be decided in assessee's appeal is with regard to denial of benefits of section 11 of the Act only in respect of the income from prohibited investments. 6.1 The brief facts of the case pertaining to this issue as emanating from record are: During the course of assessment proceedings, assessee on without prejudice submitted that even if the assessee trust is held to violate any prov....
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....udyogik Shikshan Mandal: 261 Taxmann 12 held that on a plain reading of sections 11 and 13 of the Act, it is clear that the legislature did not contemplate the denial of benefit of section 11 of the Act to the entire income of the Trust. Following the decisions of Hon'ble Jurisdictional High Court, similar view was also expressed by the Co-ordinate Bench of the Tribunal in assessee's own case in ITAs No. 1317/Mum/2018 and 1299/Mum/2018 for the assessment year 2008-09. 6.8 Thus, respectfully following the aforesaid decisions of Hon'ble Jurisdictional High Court, we direct the AO to only consider income from prohibited investments while denying the benefits of section 11, and, at the same time, grant the exemption under section 11 of the Act on interest income and income earned from non-prohibited investments by the assessee. Accordingly, ground nos. 2 to 4 raised in assessee's appeal are allowed." 10. Respectfully following the order of the co-ordinate bench of this Tribunal in the assessee's own Group trust (supra), we note that the Ld. CIT(A)'s impugned action is in conformity with para no. 6.8 (supra) wherein the Tribunal has directed the AO to grant the exemption u/s 11 of th....