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2022 (7) TMI 282 - AT - Income TaxExemption u/s 11 - whether or not the appellant trust had violated the provisions of section 13(1)(c) ? - whether benefits were availed by the specified persons without any other compensations or rent paid by such specified persons is inadequate? - appellant society is also registered under the Bombay Public Trust Act, 1950 and is also registered u/s 12A - HELD THAT:- Admittedly, Dr. G. S. Kulkarni and his two sons (hereinafter referred as “specified persons) used the operation rooms owned by the appellant trust for his private practice without paying any rent or fees for such use. Dr. G. S. Kulkarni and his two sons had occupied the accommodation that owned by the appellant trust for the residential purposes on payment of Rs.5,000/- per month for each bungalow. As admitted fact that Dr. G. S. Kulkarni had allowed 50% of the building owned by him for use of the appellant trust to pursue its charitable objects. Dr. G. S. Kulkarni and his two sons were rendering the voluntarily professional services to the appellant trust without charging any fees. The submissions made on behalf of the appellant trust that the buildings owned by the specified persons is used by the appellant without payment of any rent remains uncontroverted by the Department. Therefore, it cannot be said that the specified persons had availed the benefit from the appellant trust without paying any compensations to the appellant trust. Furthermore, it is the submission of the appellant trust that the specified persons had been rendering the voluntarily professional services to the appellant trust also remains uncontroverted. Question that arises for consideration before us is, can it be said, that the appellant availed the operation rooms owned by the appellant trust are used by the assessee without any compensations, the answer is “No”, as the appellant trust could have saved the cost of running the trust on rent, salaries as there is no rent or fees or any other claim by the specified persons of the trust for utilization of the premises as well rendering the voluntarily profession services. Whether the specified persons had paid adequate consideration paid for occupation of bungalows owned by the appellant trust? - The submission made on behalf of the appellant trust that the specified persons had been rendering voluntarily professional services to the appellant trust and are available for the patients around the clock remains uncontroverted. Therefore, the residential premises are made available for the specified persons only with view to ensure to the availability of the specified persons for the patients around the clock cannot be said to be without adequate consideration. In the circumstances, the provisions of section 13(1)(c) has no application to the facts of the present case. Accordingly, the grounds of appeal filed by the assessee are allowed.
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