| |
| The Tax Publishers2019 TaxPub(DT) 7550 (Jp-Trib) INCOME TAX ACT, 1961
Section 11/12
Treating the loan as unexplained had no link with the denial of the exemption under section 11/12. Further, as the assessee had not defaulted in any of the limbs of section 13, the exemption under section 11 could not be denied. Moreover, as the discrepancy referred to by the AO in the loan was only an accounting error duly explained by the assessee, the denial of the exemption under section 11/12 by AO was not justified.
|
Charitable trust - Exemption under sections 11 and 12 - AO found discrepancy in the loan and treated the same as unexplained -
Assessee-trust was registered under section 12AA. It had shown unsecured loans. AO treated the discrepancies found in the amount of loan as unexplained and denied the exemption under sections 11 and 12. Assessee contended that as the discrepancy mentioned by the AO did not fall in any of the limbs of section 13, denial of exemption under section 11 was not justified. Assessee further contended that said discrepancy in the loan was only an accounting error. Held: Registration granted to the assessee under section 12AA had not been cancelled or withdrawn by the CIT. Further, treating the loan as unexplained had no link with the denial of the exemption under section 11/12. And, as the assessee had not defaulted in any of the limb of section 13, the exemption under section 11 could not be denied. Moreover, as the discrepancy referred to by the AO in the loan was only an accounting error duly explained by the assessee, the denial of the exemption by AO was not justified. Hence, the AO was directed to compute the income after allowing exemption under section 11/12.
REFERRED :
FAVOUR : In assessee's favour
A.Y. :
INCOME TAX ACT, 1961
Section 40(a)(ia)
 SUBSCRIBE FOR FULL CONTENT
|