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2019 (9) TMI 909 - AT - Income TaxExemption u/s 11 - charitable activity u/s 2(15) - providing healthcare facilities and imparting medical education and training - with a view to corporatize the hospital the management of the charitable activity was handed over to SCPL - HELD THAT:- CIT(A) has correctly held that the activity of the trust to carried on in accordance with its objects and in the best interest of charity, therefore, the exemption u/s. 11(1)(a) has rightly allowed by the CIT(A). Similarly, the CIT(A) has clearly held that the Sec. 13((1)(c)(ii) can apply only if any part of the charitable income of the trust has been used or applied for the benefits of the said persons during the previous year. But, since no portion of the income of the assessee has been applied for said person, therefore, the case of the assessee falls outside the scope of this section. The trust is in receipt of income by way of management charges from SCPL and also all of its liabilities have been taken over by the same therefore there is a fact that there is no undue benefits of the use of trust property have been taken by any other persons. Similarly, there is no diversion of income of the trust as per Explanation of Sec. 13(2)(d) and 13(2)(g) of the Act as the trust has been benefitted greatly and its deficit of trust duly reduced to a great extent. We also observed that some erroneous presentation of Form No. 10B report does not disentitle the trust for claiming exemption u/s. 11 of the Act. Similarly, the amount of advance of ₹ 54,35,71,980/- in favour of SCPL appearing in the balance sheet was not advance but the reimbursement of the expenses. In the light of the aforesaid facts and circumstances, we are of the considered opinion that the CIT(A) has analyzed the facts correctly and given a judicious finding which does not call for any interference from outside. Allowance of set off brought forward losses of the trust against the current year surplus - HELD THAT:- We find that the Ld. CIT(A) has given detailed reason for allowing a set off losses and carry forward of losses on the basis of rulings of Hon’ble Jurisdictional High Court of Gujarat, Bombay and Rajasthan. In view of these facts, we are of the considering opinion that the issue is covered in favour assesse. Ld. Counsel further submitted that the issue is settled by the Hon’ble Supreme Court in the case CIT(E) New Delhi vs. Subros Educational Society in Miscellaneous Application [2018 (4) TMI 1622 - SC ORDER] . Accordingly, the findings of the CIT(A) does not call any interference from our side and accordingly the same is upheld. Therefore, this ground of appeal is dismissed. Disallowance of depreciation - HELD THAT:- We find that the issue is covered against the Revenue.
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