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2022 (6) TMI 336 - AT - Income TaxExemption u/s 11 - Life Membership Fees claimed as capital receipt of the corpus donation - AO was of the view that since the receipt is not in the nature of corpus donation within the meaning of provision of section 11(1)(d) - HELD THAT:- As per section 11(1)(d) income in form of voluntary contributions made with a specific direction that it shall form part of the corpus of the trust or institution shall not be included in the total income of the previous year of the person in receipt of the income. In the present case, the assessee did not furnish any specific direction of the donors/members regarding the amount it received. Moreover, by no stretch of imagination, membership fee can partake character of voluntary contribution so as to qualify being voluntary contribution with a specific direction that it shall form part of corpus of the trust. The membership fee is paid in anticipation/in lieu of services rendered by the assessee. The case law as relied by the assessee is not applicable on the facts of the present case. Hence, ground related to life membership fee is rejected. Donation Receipt - As stated before the authorities below that the amount was received and spent on construction of building etc. The AO rejected the claim on the basis that the assessee had received it as an ordinary donation but not as a corpus donation. Looking to the direction given by the donors and the same was credited in land & building fund account. The authorities below ought to have taken a liberal approach in construing the direction of the donors. We therefore, direct the AO to delete this addition and allow the claim of the assessee. Hence, this ground raised by the assessee is allowed.
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