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2019 (8) TMI 724 - AT - Income TaxAssessment of unutilized amount out of accumulated income u/s 11(3) - assessee has put a plea before the AO that the income so assessed u/s 11(3)(c) should also be allowed to be accumulated u/s 11(2) - HELD THAT:- We noticed that the Mumbai Bench of the Tribunal has considered an identical issue in the case of The Trustees, the B.N. Gamadia Parsi Hunnarshala [2001 (4) TMI 928 - ITAT MUMBAI] and has taken the view that the benefit of accumulation shall not be available to income assessed u/s 11(3). Tribunal has expressed the view as an alternative view. In the first instance, it has held that the benefit of accumulation shall be available only to the “income derived from the property” and not to “deemed income”. Since the income assessed u/s 11(3) cannot be considered to be an income derived from the property, the above said argument of the assessee shall fail. In any case if the argument of the assessee is accepted as correct for a moment then the provisions of sec. 11(3)(c) would be renders otiose, since the assessee would be filing application for accumulation u/s 11(2) after every expiry of the period of accumulation without applying it for stated objectives. This would result in non-taxing of income perpetually and it would defy the intention of the legislature in introducing sec. 11(3). Assessee shall not be eligible to accumulate the income assessed as deemed income u/s 11(3). Accordingly, we are of the view that the Ld CIT(A) was justified in confirming the action of the AO in assessing entire amount of ₹ 91.65 lakhs as income of the assessee without granting any benefit of accumulation. Accordingly we confirm the order passed by ld CIT(A) in both the appeals. - Decided against assessee.
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