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2016 (4) TMI 1432 - ITAT HYDERABADExemption u/s 11 - grants/contribution received by the assessee from different organisations, are in the nature of tied-up grants and thus cannot be taken into consideration for the purpose of computing total income of the assesses u/s 11 - HELD THAT:- As tri - partied agreements clearly states the budgets sanctioned, the responsibilities of Resource, implementing and Facilitating Agencies in the case of projects which are meant to be implemented thru partner NGOs. Whereas the projects which are implemented through the Assessee, the agreements are entered into with Assessee as implementing Agency along with the budget proposals sanctioned. These co-operative documents are clearly demonstrate that these grants are sanctioned for the specific purpose and the Assessee and NGOs are required to submit the audit financials and progress reports to the Resource agency. These transactions are subject to ethical audits. Since these projects are driven in the direction of the resource agency and accordingly the grants are sanctioned, are clearly demonstrate that these are tied up grants. Since the tied up grants cannot be treated as the income of the society as per the ratio laid down in the case of Nirmal Agricultural Society [1998 (12) TMI 106 - ITAT HYDERABAD-B] We are inclined to hold that the above grants are in the nature of tied up and Assessee has no control over the funds except facilitating to implement the projects. Hence Ground raised by the revenue are dismissed.
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