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2023 (12) TMI 24 - ITAT BANGALOREAssessment of trust - Allowance of expenditure incurred for earning the income of the assessee - net income v/s gross income - taxation of gross receipts without allowing the revenue expenses incurred - assessee did not upload any order granting registration under section 12AA of the Act nor under section 10(23C) - HELD THAT:- Assessee does not have registration under section 12AA nor under section 10(23C) of the Act. In the absence of the registration under the aforesaid sections, there cannot be any application of income. However, the gross receipts cannot be taxed in the hands of the assessee trust. The income earned by the assessee and expenditure relatable to the earning of such income is to be allowed as a deduction. The Bangalore Bench of the Tribunal in the case of H M V Educational Cultural and Social Trust Vs. ITO [2023 (3) TMI 1151 - ITAT BANGALORE] restored the matter to the AO with a direction to assess only the net income and not the gross. Thus restore the matter to the AO. The AO is directed to examine the financials of the assessee and allow the expenditure which have been incurred for earning the income of the assessee. We make it clear that since in the absence of registration under section 12AA of the Act, there is no question of any application of income.
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