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2015 (9) TMI 375 - ITAT PUNEExemption under section 11 denied - car purchased in the exclusive name of a trustee - Held that:- Admittedly, the assessee trust had not received any compensation in the year under consideration. The learned Judicial Member stated that while analysing the nature of the provision, particularly the quantum of compensation, should be tested/appreciated in a "subjective manner". With due regards, provisions of the Act have to be analysed and understood keeping in mind the 'object of the Legislature' and it should not be interpreted subjectively. In the instant case the language of section 13(2)(b)/13(3) does not give any discretion to the AO to give any other interpretation to the words 'made available for use'. In considered opinion if a car is purchased in the exclusive name of a trustee, who has complete control over the car and had no personal car of his own, in the absence of any resolution passed by the trust in writing, it has to be assumed that it was made available for use of the trustee irrespective of whether it was actually used or not. On a conspectus of the matter, there is violation of provisions of section 13(2)(b) r.w.s. 13(3) of the Act. Denial of exemption under section 11 should be limited to the amount which was diverted (in the instant case the car was purchased in the name of the prohibited person) in violation of section 13(2)(b) of the Act. With this observation the points of difference are answered as under: - (i) The car can be held as made available for the use of the trustee. (ii) 'Made available' for use include 'deemed use/applied for the benefit of the trustee', with or without actual use for personal benefit of the trustee. (iii) The act of the assessee falls within the ambit of section 13(2)(b) of the act. (iv) Denial of benefits of section 11 deserves to be restricted to such income of the trust which is used/applied directly or indirectly; in the instance case the car was purchased in the name of a prohibited person by applying the funds of the trust.
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