2025 (9) TMI 1674

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....ax Act, 1961 (hereinafter referred to as 'the Act') relating to the Assessment Year 2023-24. 2. The assessee has raised the following Grounds of Appeal: 1. The Ld. CIT(A) has erred in law and on facts of the case in upholding the action of the CPC in treating utilisation of accumulated amount of Rs.30,00,000/- as deemed income u/s. 11(3) of the Act and subjecting the same to tax as per Section 115BBI of the Act. 2. The Ld. CIT(A) has erred in law and on facts of the case in upholding the adjustment made by CPC u/s. 143(1)(a) of the Act based on amendment in Section 11(3) r.w.s. 115BBE of the Act which is not at all applicable in the present case. 3. Both the lower authorities have failed to appreciate that the ....

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....r under consideration, treating it as deemed income on account of delayed utilisation. 4. Being aggrieved by this adjustment, the assessee filed an appeal before the CIT(Appeals). During the appellate proceedings, the assessee submitted that the amended provisions of section 11(3) of the Act, as introduced by the Finance Act, 2022, with effect from 01.04.2023, are applicable only to accumulations made in Assessment Year 2023-24 and onwards, and not to accumulations made in prior years like F.Y. 2016-17. It was further contended that under the unamended provisions of section 11(3) of the Act, income accumulated for five years could be utilised even in the sixth year, and such utilisation would not be deemed income. Hence, the addition of ....

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....-17, assessee had time window till 31-3-2023 by which it could utilize accumulated income. The amendment brought in by Finance Act, 2022, did not debar assessee from availing said time window in respect of existing accumulations and amendment had to be read prospectively in respect of fresh accumulations for period pertaining to previous year starting from 1-4-2022 onwards. In the case of Dadar Digamber Jain Mumukshu Mandal vs. Commissioner of Income-tax (Exemption) [2025] 176 taxmann.com 661 (Mumbai - Trib.), the ITAT held that amendment to section 11(3)(c) by Finance Act, 2022 with effect from 1-4-2023 which omitted extra period of one year following expiry of initial period of accumulation of five years is prospective in nature and, thus....