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2019 (9) TMI 661 - AT - Income TaxExemption u/s 11 - charitable activity u/s 2(15) - assessee is an organisation incorporated under section 25 of the Companies Act, 1956 as not-for-profit organisation, registered under section 12A - grant of approval to the petitioner under Section 10(23C)(iv) - HELD THAT:- As decided in own case [2015 (1) TMI 928 - DELHI HIGH COURT] where an institution is not driven primarily by a desire or motive to earn profits, but to do charity through the advancement of an object of general public utility, it cannot but be regarded as an institution established for charitable purposes. Thus, while we uphold the Constitutional validity of the proviso to Section 2(15) of the said Act, it has to be read down in the manner indicated by us. As a consequence, the impugned order dated 23.01.2013 is set aside and a mandamus is issued to the respondent to grant approval to the petitioner under Section 10(23C)(iv) of the said Act within six weeks from the date of this judgment. The writ petition stands allowed as above. Depreciation to assessee trust - HELD THAT:- As decided in own case [2015 (8) TMI 89 - DELHI HIGH COURT] The equally plausible and consistent interpretation of clause (a) of Section 11(1) of the Act is that income derived from property must be calculated as per the principles of the Act. The said clause is not a computation provision and does not disturb the “income” earned or available but postulates that the “income” as computed in accordance with the provisions of the Act to the extent of 86% must be applied. Application of income may include purchase of a capital asset. The said purchase is valid and taken into consideration for the purpose of ensuring compliance, i.e., application of money or funds and is not a factor which determines and decides the quantum of income derived from property held under trust. Addition on a/c of space rent income on the basis of disclosure in Notes to Accounts of the assessee - HELD THAT:- We are of the considered view that when income on account of space rent has not been accrued, as in the instant case due to dispute, there cannot be any rent even though entry in the books of account have been made on account of notional income. So, when the income would be received its taxability can be examined by the Revenue. Ld. DR for the Revenue has not brought on record any document if the dispute between the parties qua the space rent has been resolved. So, in these circumstances, we are of the considered view that there is no illegality or perversity in the findings returned by the ld. CIT (A) - Decided against revenue
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