2026 (4) TMI 1540

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.... 22/02/2025, for the assessment year (AY) 2016- 17. Though, the assessee has raised multiple grounds of appeal. However, in our considered opinion the substantial ground of appeal relates to treatment of corpus donation/ fund received in earlier year is taxable and /or not taxable being capital receipt. Rest of the grounds are consequential. 2. The brief facts of the case are that the assessee is a charitable trust. The assessee is registered with Charity Commissioner under the provisions of Bombay Trust Act. Registration under section 12A/12AA of the Act, was allowed on 30.05.2019, which is effective from A.Y 2019- 20. The assessee has filed return of income for the A.Y 2016-17 on 21/08/2017 declaring net taxable income at Rs. 1,24,2751....

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....ombay Public Trust Act. The trust was constituted on 23/07/1965 i.e. trust is 50 years long back trust. The Ld. AR of the assessee further submits that the trust has decided to build and community hall and for the development, maintenance fund was collected from devotees by keeping a box in the temple premises. During the year under consideration the assessee has received voluntary contributions of Rs. 88,20,088/- for construction of community hall for devotee coming from adjoining area of Vidarbha Region as well as other state also for worship. The Ld. AR of the assessee submits that the assessee is regularly maintaining it books of account and books of accounts of the assessee trust were audited as per the provision of Bombay Public Trust....

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....laced reliance on following judicial precedents. * Shri Marudhar Sewa Samiti Vs. ITO in ITA No. 501/Ahd/2022 dated 16.06.2023, * Serum Institute of India Research Foundation Vs. ITO in ITA No. 1539/PN/2008 dated 12/08/2016, * Chandra Prabhu Jain Swetamber Mandir Vs. ACIT inITA No. 230/Mum/2016, * CIT Vs. M/s. Pentafour Software Employees' Welfare Foundation in Tax Case Appeal Nos. 582 tο 584 of 2009 dated 05/08/2019(Madras High Court), * ITO Vs Gaudiya Granth Anuved Trust in ITA No 386/ Agra/2012 dated 02/08/2013, * ITO (Exemption) Vs. Smt. Basanti Devi & Shri Chakhan Lal Garg Education Trust in ITA No. 5082/Del/2010 dated 19/01/2011. 5. On the other hand, the ld CIT-DR fo....

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....purpose of construction of community hall that is for capital expenditure. The assessee was denied benefit of section 11 on the ground that there was registration under section 12AA in AY 2016-17. 7. The terms 'corpus fund' and 'corpus donation' is generally used with respect to a trust. A corpus fund denotes a permanent fund kept for the basic expenditure needed for the administration and survival of the trust. The corpus fund is generally not allowed to be utilized for the object of trust. Such fund can also be used for creation of capital asset or property of the trust from which income can be generated. Corpus funds are generally created from corpus donation. A donation will be treated as corpus donation only if it is accompanied by ....