TaxTMI 
TaxTMI 
Prohibited use or application by the member of trust or institution - Section 13(2)/(4)
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....rust whenever created, is, during the previous year, used or applied directly , for thee benefit of any person referred to in section 13(3), the denial of exemption operates, section 13(2) specifies a few particular instance where the income or the property is to be deemed to have been used for the benefit of a person referred to in section 13(3). it should be noted that those particular instance ....
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....g or other property of the trust or institution is, or continues to be, made available for the use of any person referred to in section 13(3), for any period during the previous year without charging adequate rent or other compensation; (c) Excess payment for services - if any amount is paid by way of salary, allowance or otherwise during the previous year to any person referred to in section 13(....
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.... sold by or on behalf of the trust or institution to any person referred to in section 13(3) during the previous year for consideration which is less than adequate; (g) Diversion of income or property exceeding ₹ 1,000 - if any income or property of the trust or institution is diverted during the previous year in favour of any person referred to in section 13(3), the aggregate of the income....
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....y that the funds of the trust or the institution have been invested in a concern in which such person has a substantial interest. [ Section 13(4) ] Meaning of Substantial Interest Section 13(2)(h), section 13(4) refers to cases where a person has A person shall be deemed to have a substantial interest in a concern,- (i) in a case where the concern is a company - if its shares (not being share....