2010 (7) TMI 159 - DELHI HIGH COURT

Deduction u/s 11 – violation of section 13(1)(d) - assessing officer noticed that the assessee-society had in the assessment year 2005-2006 given a loan of Rs. 90,50,000/- to another educational society, namely, Nav Bharti Educational Society. It is pertinent to mention that the President of Nav Bharti Educational Society was the brother of the President of assessee-society. – Held that: - that interest free loan of Rs. 90,50,000/- given by the assessee-society to Nav Bharti Educational Society does not violate Section 13(1)(d) read with Section 11(5) of Act, 1961 as the said loan was neither an “investment” nor a “deposit”. This is more so as both the societies had similar objects and were registered under Section 12A of Act, 1961 and had approvals under Section 80G of the Act, 1961. The fact that the loan was interest free and had been subsequently returned is also significant.