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2023 (6) TMI 114 - AT - Income TaxExemption u/s 11(1)(a) and Section 11(2) for Deemed income u/s 11(3) - as per assessee apparently there is no such prohibition that “deemed income” u/s 11(3) shall not be eligible for claim of exemption - HELD THAT:- We observe that in the case of Prabhas Patan Jain vs. Income Tax Officer,[2023 (2) TMI 963 - ITAT RAJKOT] has held that exemption under section 11 is not available on “deemed income” and, therefore, assessee was not eligible to claim exemption under section 11(1)(a) and section 11(2) in respect of “deemed income” under section 11(3) of the Act. CIT(Appeals) has not erred in facts in law in holding that “deemed income” under Section 11(3) of the Act is not eligible for claim of exemption under Section 11(1)(a) and 11(2). Assessee would be allowed to accumulate the income if there is “real income” which is in possession of the assessee - something which is not in possession of the assessee cannot be accumulated or utilized at a later date. In the case of “deemed income” u/s 11(3) where the amount is already spent by assessee for purposes other than charitable purposes, it cannot be said that the assessee accumulated such income with an intention to apply it for rightful purpose. Therefore “deemed income” u/s 11(3) of the Act is not eligible for claim of exemption under Section 11(1)(a) and Section 11(2) of the Act. Decided against assessee.
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