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2015 (9) TMI 1248 - SC - Income TaxExemption u/s 11 - accumulation of income upto 25% - Held that:- where CIT (Appeals) has gone wrong is that he ignored the provision which entitled the assessee to exercise such an option only to the extent of 25%. In the instant case, the assessee had exercised the option of setting apart an amount of ₹ 32 lacs which was more than 25%. The total income was ₹ 99,41,221/- and 25% thereof would be ₹ 24,85,305/-. Thus, the entire amount of ₹ 32 lacs could not have been allowed as directed. This aspect has not been noticed by the High Court as well. No further amount could be allowed as deduction and we do not understand as to how the entire income is treated as exempted from income tax. We, accordingly, allow this appeal by setting aside the order of the High Court and direct the Assessing Officer to recompute the taxable income in accordance with this judgment.
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