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2016 (9) TMI 959 - AT - Income TaxDisallowance of depreciation as deduction U/s.35(2)(iv) is allowed in respect of capital expenditure on scientific research - depreciation allowability to charitable trust - double deduction - Held that:- CIT(Appeals) has allowed the claim of the assessee by following the various decisions including the decision of Hon'ble Bombay High Court in the case of CIT Vs. Institute of Banking Personnel Selections (2003 (7) TMI 52 - BOMBAY High Court ) as well as the decision in the case of CIT Vs. Society of the Sisters of St. Anne [1983 (8) TMI 44 - KARNATAKA High Court ]held that depreciation is allowable on capital assets on the income of the charitable trust for determining the quantum of funds which have to be applied for the purpose of trusts in terms of section 11 of the Act. We find that this issue is now settled in favour of the assessee by a series of decisions by the High Courts as well as this Tribunal - Decided in favour of assessee. Interest free loans given to the charitable trust - Held that:- For attracting the provisions of section 13(1)(c)(ii), the beneficiary of income or property has to be the author trust, any person who has made substantial contribution to the trust in case HUF is the author of the trust, a member of the family or any trustee of the trust or manager, any relative of any such author, founder trustee or manager. Any concern in which any of the persons referred in clause (a) to (d) has a substantial interest. Thus in the case of the assessee, the interest free loan was given to another trust and the common trustee have no substantial interest in any of the trust. Therefore in the absence of any direct or indirect benefit to the trustees or author of assessee trust or to the trustees of the resident trust the provisions of section 13(1)(c) cannot be attracted. Revenue appeal dismissed.
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