INCOME TAX ACT, 1961

Section 11

Charitable trusts - Exemption under section 11 - Directions of donor that voluntary contribution shall form part of corpus of trust, not produced by assessee -

Assessee was a charitable trust running an institute in name of Institute for International Management & Technology, Gurgaon. It was registered under section 12A and was claiming exemption under sections 11 and 12. AO alleged that assessee was not carrying on educational activity in terms of section 2(15) and denied benefit of sections 11 and 12. Held: According to section 11(1)(d), wherein certain income are not to be included in income of recipient when income in form of voluntary contribution made with a specific direction that they shall form part of corpus of the trust. It is not intention of donee but direction of the donor that is important to determine whether voluntary contribution received by assessee trust is towards corpus or not. Admittedly no such direction of donor was placed by assessee. Since assessee did not have directions of donor that it shall form part of the corpus of trust, naturally benefit of section 11(1)(d) could not be given to assessee. Issue was restored to AO with a direction to assessee to submit such direction of donor, if available, as prescribed under section 11(1)(d). If assessee failed to do so, AO was duty bound to consider it as voluntary contribution.

REFERRED : DIT, Bangalore v. Sri Ramakrishna Seva Ashrama (2013) 357 ITR 731(Kar.) : 2012 TaxPub(DT) 1661 (Karn-HC) ADIT, Circle-IV New Delhi v. Umak Educational Trust [ITA No.5589/Del/2012, dt. 28-6-2013]

FAVOUR : Matter remanded

A.Y. : 2009-10

SUBSCRIBE FOR FULL CONTENT

OR Try Reload the Page