TaxTMI 
TaxTMI 
2025 (8) TMI 970
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....t Appellant's accounts were audited by C.A whose details are furnished in the return of income. Hence, denying exemption u/s 11 to the Appellant and restricting corpus donations of Rs. 28,73,338/- by the Assessing Officer is not justified on the ground that appellant failed to furnish the required information. 4. For all of the above and such other grounds as may be urged at the time of hearing, it is prayed that the appeal be allowed, and suitable directions be issued to the Assessing Officer to grant exemption u/s 11 and complete the assessment on the basis of return in the interest of justice". 3. The learned Counsel for the assessee submitted that the assessee has received corpus donation during the financial year 2016-17 relevant to the A.Y under consideration. He has referred to the donation receipts placed at page Nos. 4 to 18 of the paper book and submitted that all these donations are duly reflected in the bank account of the assessee, details of which are also given in statement of corpus donation at page No.1 & 2 of the paper book. The Assessing Officer has made an addition of the said amount of corpus donation of Rs. 28,74,878/- for want of documentary evide....
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....val contentions as well as the relevant material available on record. The assessee has filed its return of income for the year under consideration on 03/11/2017 declaring total income at Nil after claiming exemption u/s 11 of the Act. The Assessing Officer noted that during the year, the assessee has declared corpus donation of Rs. 28,73,388/- and admitted gross receipts other than corpus donation receipts at Rs. 1540/-. The case was selected for complete scrutiny under CASS. However, there was no compliance on behalf of the assessee to the notices issued by the Assessing Officer u/s 143(2) and 142(1) of the Act. Consequently, the Assessing Officer proposed to frame the assessment u/s 144 of the Act and issued a show cause notice dated 25/11/2019. Again, there was no response on behalf of the assessee to the show cause notice for completion of assessment u/s 144 of the Act and accordingly the Assessing Officer has framed the assessment u/s 144 of the Act whereby an addition of Rs. 28,74,878/- on account of corpus donation is made by denying exemption u/s 11 of the Act as the said income was neither applied for charitable purpose nor set apart for future application in terms of sect....
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....rust of India Act, 1963 (52 of 1963); (v) investment in any security for money created and issued by the Central Government or a State Government; (vi) investment in debentures issued by, or on behalf of, any company or corporation both the principal whereof and the interest whereon are fully and unconditionally guaranteed by the Central Government or by a State Government; (vii) investment or deposit in any public sector company: Provided that where an investment or deposit in any public sector company has been made and such public sector company ceases to be a public sector company,- (A) such investment made in the shares of such company shall be deemed to be an investment made under this clause for a period of three years from the date on which such public sector company ceases to be a public sector company; (B) such other investment or deposit shall be deemed to be an investment or deposit made under this clause for the period up to the date on which such investment or deposit becomes repayable by such company; (viii) deposits with or investment in any bonds issued by a financial corporation which is engaged in providing lon....
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....corpus donations of Rs. 28,73,338/- and also why the exemption claimed u/s. 11 of the Act cannot be denied is correct to the extent of corpus donations. The additions made by the AO has to be limited to Rs. 28,73,338/- and the grounds are partly allowed". 6. Thus, the learned CIT (A) has confirmed the addition solely on the ground that the assessee has failed to prove that the corpus donation was used/investment as per section 11(5) of the Act. It is pertinent to note that prior to the amendment to section 11(1)(d) vide Finance Act, 2021 w.e.f. 01/04/2022, the income from voluntary contributions made with a specific direction that they shall form part of corpus fund of the Trust or Institution shall not be included in the total income of the previous year of the Trust/Institution. For ready reference, clause (d) of section 11(1) as existed at the relevant point of time is reproduced as under: "11 (1) Subject to the provisions of section 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)............... (b)............... (c)............... (d) Income....