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2013 (9) TMI 404 - AT - Income TaxAccumulation of income - 'total income' 2(45) versus 'Income' u/s 11(1) - charitable institution - benefit of standard deduction under income from house property for the purpose of accumulation of income - Deduction u/s. 24(a) - Computation of income of trust - Held that:- While Sec.2(45) of the Act specifically defines "total income" the expression used in section 11(1) is only income. Accordingly, it would be incorrect to assign to the word 'income' used in section 11(1)(a), the same meaning as has been specifically assigned to the expression 'total income' in Sec.2(45) of the Act. The income from property held for charitable or religious purposes cannot be equated with the income which is computed under the general provisions of the IT Act in respect of other assessees. In a case where an assessee-trust has income from different sources and a part of such income comes within the ambit of taxation, it will not be possible to earmark any part of such income to a particular head. Such income has to be computed in a normal commercial manner. Therefore, the question of allowing any statutory deductions as contemplated by the different provisions of the IT Act dealing with different heads of income cannot arise while deciding the percentage of application or accumulation under section 11 - Following decision of DIT Vs. Girdharilal Shewnarain Tantia Trust [1991 (6) TMI 8 - CALCUTTA High Court] - Decided in favour of Revenue. Disallowance of depreciation - Held that:- If depreciation is not allowed as a necessary deduction for computing income of charitable institutions, then there is no way to preserve the corpus of the trust for deriving the income as it is nothing but a decrease in the value of property through wear, deterioration, or obsolescence. Since income for the purposes of section 11(1) has to be computed in normal commercial manner, the amount of depreciation debited in the books is deductible while computing such income - Following decision of CIT v. Market Committee, Pipli [2010 (7) TMI 374 - Punjab and Haryana High Court] - Decided against Revenue.
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