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| The Tax Publishers2020 TaxPub(DT) 4441 (Karn-HC) : (2019) 417 ITR 0539 INCOME TAX ACT, 1961
Section 11
Income derived from trust property was also to be computed on commercial principles and if commercial principles were applied, then adjustment of expenses incurred by trust for charitable and religious purposes in the earlier years against income earned by trust in subsequent year would have to be regarded as application of income of the trust for charitable and religious purposes in the subsequent year.
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Charitable trust - Exemption under section 11 - Allowability of carry forward and set-off of excess expenses -
Question arose for consideration was as to whether assessee-charitable trust was entitled to carry forward excess/surplus funds for set-off as application of income against income of subsequent years.Held: Income derived from trust property was also to be computed on commercial principles and if commercial principles were applied, then adjustment of expenses incurred by trust for charitable and religious purposes in the earlier years against income earned by trust in subsequent year would have to be regarded as application of income of the trust for charitable and religious purposes in the subsequent year.
Followed:CIT (Exemptions) v. Ohio University Christ College (2018) 408 ITR 352 (Karn) : 2018 TaxPub(DT) 7055 (Karn-HC) rendered on 17-7-2018 in ITA. No. 312 of 2016 and I. T. A. No. 313 of 2016.
REFERRED :
FAVOUR : In assessee's favour.
A.Y. :
INCOME TAX ACT, 1961
Section 11
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