2000 (12) TMI 99

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....sment years 1974-75 and 1975-76 in February, 1977. It claimed exemption under section 11 of the Income-tax Act, 1961 (for short "the Act"), on the ground that income received by it is for charitable purpose. The said claim for exemption was refused by the Income-tax Officer on the ground that it was not duly registered with the Commissioner of Income-tax under section 12A(a) of the Act, and also on the ground that no notice of accumulation of income as required under section 11(2) of the Act was given. When the matter was taken up in appeal, the same was remanded to the assessing authority by the appellate authority holding that the finding of the Assessing Officer that the association was not duly registered as required under section 12A(a....

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....e case, the Income-tax Appellate Tribunal is correct in holding that the Income-tax Rules could not fix any time limit for submitting an application in Form No. 10 under rule 17 of the Income-tax Rules, 1962 ?" That the High Court as per its order dated October 15, 1992, held that though section 11(2)(a) of the Act contemplated a notice in writing to the Income-tax Officer in the prescribed manner the rule concerned, namely, rule 17 of the Rules, did not prescribe any time limit and it is only Form No. 10 which prescribed such a limitation of six months commencing from the end of each previous year for issuing the notice as required under section 11(2) of the Act. It also held that the Act had not provided for such rule-making authority to....

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....aim the benefit under section 11(2) of the Act for those years. We find substantial force in this argument. Chapter III of the Act which consists of sections 10 to 13A enumerates various types of income which do not form part of total income for the purpose of levy of tax. The relevant part of section 11 in the said Chapter reads thus : "11. (1) Subject to the provisions of sections 60 to 63, the following income shall not be included in the total income of the previous year of the person in receipt of the income--- (a) income derived from property held under trust wholly for charitable or religious purposes, to the extent to which such income is applied to such purposes in India ; and, where any such income is accumulated or set apart....

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....ncome in the assessable income of the assessee. Therefore, even assuming that there is no valid limitation prescribed under the Act and the Rules even then, in our opinion, it is reasonable to presume that the intimation required under section 11 has to be furnished before the assessing authority completes the concerned assessment because such requirement is mandatory and without the particulars of this income, the assessing authority cannot entertain the claim of the assessee under section 11 of the Act, therefore, compliance with the requirement of the Act will have to be any time before the assessment proceedings. Further, any claim for giving the benefit of section 11 on the basis of information supplied subsequent to the completion of ....