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2017 (1) TMI 935 - AT - Income TaxDisallowance of exemption claimed by the assessee u/s 11(1)(d) - AO treating the receipts of voluntary contribution and corpus donation as taxable income there being violation of provision of section 13(3) - addition on advances - Held that:- In respect of advance of ₹ 22,16,000/-to M/s Rajkala Industries (P) Ltd., the assessee’s submission regarding advance of ₹ 20 lacs has already been accepted by the AO to the extent that ₹ 20,00,000 is the opening balance at the beginning of the year under consideration and it is only an amount of ₹ 2,16,000/- which pertains to the year under consideration. As far as ₹ 20 lacs is concerned, the same was subject matter before Coordinate Bench in A.Y. 2011-12 and it was held therein that there is no income generated on the said amount of ₹ 20 lacs in A.Y. 2011-12 and there is nothing which can be brought to tax in the hands of the trust in A.Y. 2011-12. Regarding balance amount of ₹ 2,16,000/- which pertains to the year under consideration, the same has already been offered to tax in the return of income for the year under consideration and there is nothing further which can be brought to tax in the hands of the assessee’s trust. Coming to the advance advanced to Smt. Madhu Adukia is concerned it is not in dispute that the class rooms were actually constructed in F.Y. 2012-13 out of the said advance, the class rooms were constructed on premises provided by Smt. Madhu Adukia without any charges to Gyan Sindhu Girls college and the advance has subsequently been refunded. The intent of such an advance is clearly for promoting and supporting the girls education and which has been demonstrated through building of class rooms. Merely because the money has been routed through Smt Madhu Adukia, it cannot be said that she has benefitted out of such advances in any manner. Further, there is no income which has been generated in the hands of the assessee’s trust out of such advances which can be brought to tax. AO is directed to allow the exemption u/s 11 to the assessee trust and the additions made by the AO are hereby deleted. - Decided in favour of assessee
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