TMI Blog2003 (12) TMI 276X X X X Extracts X X X X X X X X Extracts X X X X ..... -tax Rules, 1962. (ii) Although the learned CIT(A) mentioned in her order that detailed report was submitted by Mrs. Jyoti Rani, the then Assessing Officer on the written arguments of the appellant vide her letter No. 8389 dated 14-10-1999, but the impugned appellate order has been passed on 2-3-2001. Since, Mrs. Jyoti Rani was transferred and relieved on 12-4-2000, the learned CIT(A) was not justified in not allowing any opportunity to the present Assessing Officer before passing order. (iii) While allowing relief, the learned CIT(A) has relied upon the additional evidences without affording any opportunity, which are not relevant to the year in question and hence are immaterial. (iv) The ld. CIT(A) is also incorrect in accepting the plea of the assessee regarding donation of Rs. 1 lakh for Kargil War and Rs. 2 lakhs for Gujarat Relief Fund given in the year 1999-2000 pertaining to the assessment year 2000-01 when the appeal in question was for the assessment year 1996-97. Further, the learned CIT(A) has gravely erred by not affording any opportunity to the Assessing Officer as provided under Rule 46A(3) before admitting additional evidence. (v) The learned CIT(A) is wrong ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the year in question and the donation received on 12-7-1995 by Sardarni Uttam Kaur Educational Society was transferred to industrial concerns of the trustees immediately after the receipt of donations. Thus, the whole exercise comes within the ambit of colourable device in view of decision of Hon'ble Supreme Court in the case of McDowell Co. Ltd. v. CTO [1985] 154 ITR 148. 7. The learned CIT(A) is not justified in deleting the addition of Rs. 2.49 lakhs by holding that income/loss derived from agricultural operation forms part of income of the appellant trust and is exempt being a charitable institution without appreciating the facts that the business of the agricultural operation was not incidental to the attainment of the objectives of the trust and hence, provisions of section 11(1) of the Income-tax Act, 1961 would not be applicable to such income/loss as provided in section 11(4A) of the Income-tax Act, 1961. 8. It is prayed that the order of the learned CIT(A) be cancelled and that of the Assessing Officer may be restored. 3. The first six grounds of appeal relate to the same issue i.e., the ld. CIT(A) was not justified in holding that donation of Rs. 29 lakhs given ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d of service in the medical field. He served PGI for almost two decades. Dr. Chuttani was a bachelor and bequeathed his entire wealth to TTVC. Since Dr. Chuttani was associated with medical profession, his dream was also to set up a trust, which would afford medical relief and encourage medical research and for that purpose Chandigarh Medical Centre and Chuttani Medical Centre were set up. It was emphatically submitted that the Assessing Officer had failed to appreciate that the assessee-trust's activities were not merely to afford medical relief and encourage medical research but were charitable also which was obvious from its name as 'Trilok Tirath Vidyavati Chuttani Charitable Trust'. It was submitted that the Assessing Officer had mentioned the donee-trust as 'Sardarni Uttam Kaur Charitable Society' all along in the assessment order, whereas the correct name of the donee-trust is 'Sardarni Uttam Kaur Educational Society'. It was submitted that the Assessing Officer had misinterpreted the provision of law governing the trust. As per Article 4 of the trust, donation to University, School or other like institutions is one of the objects of the trust and 'education' stands covered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stood how Nursery schools, not connected with the field of medicine, fit into the scheme of things. When seen in totality, the main objects of the assessee-trust related to medical field only and not ordinary nursery school. (ii) SUKES was created in 1993 which had no specific record in the field of nursery education and even while giving the donation, no condition was imposed, which was contrary to the proviso to Article 4 of the trust deed. No worthwhile service had been rendered in the field of nursery education by the donee-trust, i.e., SUKES till the receipt of the donation. (iii) It was pointed out that the Managing Trustee of SUKES was the daughter of Mrs. G.K. Brar. Mrs. G.K Brar was one of the trustees with Dr. Chuttani, in another trust named as 'Cancer Society of North India'. As per information gathered, the donee-trust had given interest free advances amounting to Rs. 72,01,362 on 31-3-1996, out of which an advance of Rs. 25 lakhs was given to M/s. Falcon T M Enterprises Pvt. Ltd., which was one of the companies belonging to Brar family. Similarly, the society had given an advance of Rs.25 lakhs each to M/s. Dashmesh Fab. Yarns Ltd. and M/s. Dashmesh Haegons Agro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he maintenance of hospitals, clinics, dispensaries, nursery schools or other establishments of like nature. Thus, she found that providing financial assistance to nursery schools was also included in the objects of the trust. She observed that a donation of Rs. 29 lakhs given to Sardarni Uttam Kaur Educational Society for running a nursery school fell within the objects of the trust. She further observed that SUKES was also granted exemption under section 80G of the Income-tax Act and, therefore, there is no doubt that SUKES was a public charitable trust. Thus she held that giving of the donation of Rs. 29 lakhs was not inconsistent with the objects of the assessee-trust. By referring to the CBDT Circular No. 1132 dated 5-1-1978, the ld. CIT(A) further held that when a charitable trust donates to another charitable trust, provisions of section 11(1)(a) could be said to have been met. As regards the allegations of the Revenue that donation given to SUKES were utilized for giving loans to the business ventures of Brar family and the funds were not utilized for achieving objects of the trust, the ld. CIT(A) held that donation was given in good faith and bona fide belief that it would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enue that the assessee was running Chuttani Medical Centre on commercial lines, the ld. CIT(A) observed that assessee had engaged eminent doctors as consultants, who had revenue sharing arrangement with the trust and were paying 25% of the fees to the Centre and the balance was reflected as income. The operations of the trust were running within the parameters of its objectives. No institution can run without finance, otherwise the trust would be eating its corpus, hence derivation of income was not incongruent to the objectives of the trust and it does not defeat the objectives of the trust provided the income was reinvested in the institution itself. Section 11(4a) allows the trust to run a business and exemption in respect of profits and gains would be available if running of such business was incidental to the attainment of the objectives of the trust and such money had been reinvested for the objectives of the trust. She took note of the fact that free aid was being given in deserving cases. No benefits were being availed by any individual of the trust. Thus, she held that the objection raised by the Revenue in this regard was not correct. In the light of these facts and circu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed by the assessee. Adverting to the main issue regarding allowance of claim for exemption under sections 11 and 12, the ld. D.R. submitted that the assessee-trust had not utilized its income for achieving the objectives of the trust on account of the following facts : (i) The assessee was granted registration by the CIT in Feb., 1976 and had no liquid funds in its corpus. The assessee sold one of its properties at Panchsheel Park, New Delhi for Rs. 3,29,68,428. The sale proceeds were received during assessment year 1995-96 and interest income on such sale proceeds started accruing from assessment year 1995-96. Thus there is no application of funds for charitable purposes in the earlier year. The assessee was not able to establish in a credible manner that it had carried out activities of a charitable nature as envisaged in its objectives. (ii) Sardarni Uttam Kaur Educational Society (recipient-society), was used as a conduit by the assessee-trust for canalizing funds to interested persons. The CIT(A) in order to prove that the assessee-trust was set up for charitable purposes and as such entitled to exemption under section 11, relied on an outdated CBDT Instruction No. 1132 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication of income for charitable purpose except the alleged donation of Rs. 29 lakhs given to Sardarni Uttam Kaur Educational Society. Even the promised application of income for setting up PGIMER was not intended to be fulfilled, as seen from the application seeking accumulation, without specifying the purpose, quantum etc. It is inexplicable, as to why the assessee-trust was so prompt in making donation to Sardarni Uttam Kaur Educational Society for an incongruent objective but was lethargic and casual in doing so in case of the immediate and primary objective of setting up the proposed PGIMER. Apparently, the intention was to continue with the diversion of the commercially earned income to the interested persons. In this regard reliance was placed on the judgment of Supreme Court in the case of CIT v. Rattan Trust [1997] 227 ITR 356. (vi) The objectives of the trust when seen in totality refer to running of institutions as related to medical field only and not ordinary nursery schools. Further, the objects of the SUKES are not similar to that of assessee-trust. In this regard reliance was placed on the decision of Madras High Court in the case of CIT v. M.CT. Muthiah Chettier ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for assessment year 1997-98. Reliance was placed on two judgments - One of Madras High Court in the case of M.CT. Muthiah Chettiar Family Trust and the other of Calcutta High Court in the case of Director of Income-tax (Exemption) v. Trustee of Singhania Charitable Trust [1993] 199 ITR 819. Besides, it was submitted that the assessee-trust had ostensibly donated funds to the recipient society for setting up 'nursery schools' for furtherance of the objectives of the recipient society, which was primarily in the field of education. However, it was found as under :- (a) The recipient society was set up on 21-7-1993 for promoting charities in the field of education. (b) The recipient society was confined to the pages of the trust deed and accounting records without any charitable activity having been conducted ever since its inception till the year relevant to the accounting year under reference. (c) The recipient society was situated in village Saranaga, with the name of society (SUKES) on a signboard outside the room occupied by the security guard of Brar family. (d) The recipient society had set up no schools or other educational institutions. (e) The recipient society ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e same shows corpus of Rs. 3.10 crores of the Trust. He drew our attention to page 33 of the paper book for the assessment year 1997-98, which is a copy of the receipts and expenditure for the financial years 1993-94, 1994-95, 1995-96 and 1996-97. He submitted that that right up to the assessment year 1995-96, net result of the trust was a loss. However, the assessee started earning interest income on sale proceeds of the property from the assessment year 1995-96 onwards. He submitted that for the assessment year 1996-97, interest income aggregated to Rs. 32,13,031. Thus, the question of application of income arose in the assessment year 1996-97. The assessee donated an amount of Rs. 29 lakhs to SUKES for the purpose of nursery schools, which was one of the objects of the assessee-trust. He submitted that SUKES was registered with the CIT, Jalandhar for the purpose of section 80G. He drew our attention to a copy of order dated 21-9-1993 of the CIT, Jalandhar granting registration to SUKES for the assessment years from 1994-95 to 1997-98. He submitted that the objects of SUKES were, inter alia, to open, run, and continue educational and vocational institutions. Thus, the objects of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itable institution amounted to application of income for charitable purposes and hence the donor-trust was entitled to exemption of the amount donated. For this proposition, the ld. Counsel relied on the judgment of Bombay High Court in the case of Trustees of the Jadi Trust, and the judgment of Gujarat High Court in the case of CIT v. Sarladevi Sarabhai Trust No. 2[1988] 172 ITR 698. He further submitted that there was no bar on assessee to carry on business. The mere fact that assessee was running CMC for commercial consideration did not disentitle the assessee from exemption of its income so long as the income so generated had been utilized and reinvested for the objects of the trust. He relied on the decision of ITAT, Amritsar Bench in the case of Dy. CIT v. Ch. Aishi Ram Batra Charitable Trust [1999] 70 ITD 487, decision of ITAT, Delhi Bench in the case of Taxation Owners Sarla Bhargava Memorial Trust v. ITO [1996] 59 ITD 331, and the decision of ITAT, Ahmedabad Bench in the case of Stock Exchange Ahmedabad. He further submitted that once the assessee had donated the amount to an educational society, it lost control over the said amount. There are no provisions in any Act unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e have heard both the parties at length and given our thoughtful consideration to the rival submissions. We have carefully gone through the orders of the authorities below, examined the facts, evidence and material placed on record. We have also referred to the respective pages of the paper book to which our attention has been drawn and the various judgments cited at the bar. 9.1 At the outset, it must be mentioned that appeals for both the assessment years 1996-97 and 1997-98 were heard together. It was announced in the court that the Bench would decide whether to dispose of both the appeals together or only one appeal. We find that the facts for the assessment year 1997-98 are slightly different and relate to accumulation of income on which we feel that both the parties need to be further heard. Therefore, the Bench decided that for the present only appeal for the assessment year 1996-97 be disposed of. 10. The facts discussed above show that while completing the assessment for the assessment year under reference (1996-97), the Assessing Officer did not doubt the charitable character of the assessee-trust. However, his objection was that assessee had given donation to Sardarn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have not been dealt with in the assessment order. Reliance in this regard is placed on the two judgments of Supreme Court in the cases of CIT v. ShapoorjiPallonjiMistry[1962] 44 ITR 891, and CIT v. Rai Bahadur Hardutroy Motilal Chamaria [1967] 66 ITR 443. 11. Now, in the present case, we find that the assessee had claimed exemption in respect of income of the trust under section 11 of the Income-tax Act. The Assessing Officer had denied such exemption. The assessee carried the matter in appeal before the CIT(A). Thus the issue whether the assessee was entitled to exemption in respect of its income or not was the subject-matter of dispute before the CIT(A) and it was not something which related to new source of income. The report of the Assessing Officer on the written submissions filed by the assessee also related to the exemption denied by the Assessing Officer. Therefore, the ld. CIT(A) was within her powers to take cognizance of such report and decide the matter. As regards the reliance of the assessee on the judgment of Bombay High Court in the case of Lokenath Tolaram, we find the same is distinguishable on facts. In that case, the facts before the Bombay High Court were th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income Tax. The CIT examines such application with reference to the objects of the trust and grants registration only if it is found that the objects of the trust are charitable. Procedure in this regard has been spelt out under section 12 AA of the Income-tax Act and the requisite conditions for registration have been spelt out in section 12A of the Act. Once registration is granted to the trust, it enables the trust to claim exemption in respect of its income subject to fulfilment of other conditions relating to application and accumulation of income spelt out in sections 11 to 13 of the Income-tax Act. But grant of registration is a testimony of the fact that trust is a charitable institution. It is also important to note that registration is not granted by the Commissioner for indefinite period. It is only for a limited period of 3 to 4 years. In case the assessee desires to seek renewal of registration, the assessee has to make fresh application. The same is liable to fresh examination by the Commissioner and further registration would be allowed only after satisfying that objects of the trust are charitable. However, at the time of completing the assessment, the Assessing Off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterests of India or any part thereof. The memorandum of understanding provided that the income and property of the assessee shall be applied solely towards the promotion of its objects for which it had been set up. The assessee purchased property and rented out the same. The question was, whether the property held under a trust was for charitable purposes and the income therefrom was exempt from tax. On these facts, the Hon'ble Apex Court held that advancement or promotion of trade, commerce and industry, leading to economic prosperity enured for the benefit of the community. That prosperity would be shared also by those who were engaged in trade, commerce and industry, but on that account the institution retains its character of general public utility. It was held that the Legislature has used language of great amplitude in defining 'charitable purposes' and the definition was inclusive and not exhaustive or exclusive. The Hon'ble Supreme Court further held that 'object of general public utility' was not restricted to the objectives beneficial to the whole of the mankind. An object beneficial to a section of public was an object of general public utility. To serve as a charitable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty, institution etc. having as its sole objects, all or any of the objects of the assessee trust. The third proviso further provides that no part of income or corpus of the trust shall be applied directly or indirectly for the benefit of founders or their relatives or other persons specified in section 13 of the Income-tax Act. Thus, these objects enshrined in the trust deed do not cast any doubt in anybody's mind that objects of the trust are for general public utility and not for the benefit of any particular class or community or group. Besides, it restricts that the income or the corpus of the trust shall not be applied directly or indirectly for the benefit of founders, their relatives and other persons as specified in section 13 of the Act. 12.3 One of the objections raised by the ld. D.R. is that the assessee is running Chuttani Medical Centre on commercial considerations and, therefore, it ceases to be a charitable institution and as such its income is not exempt under section 11 of the Income-tax Act. From the facts discussed above, it is obvious that providing medical relief is one of the main objects of the trust. For this purpose, the trust has engaged eminent doctors ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t function. One such instance is that of Dr. Trehan, a prominent heart specialist/surgeon working in ESCORT Hospital, New Delhi, which is again a charitable institution. It is because of such facilities provided by the trust that such doctors can make use of their professional competence and skill in treating the patients. This is exactly what the assessee-trust has done. The assessee has brought prominent professionals under one roof and provided all necessary infrastructure and facilities required for the treatment of patients. Thus, these activities are for the attainment of the main object of the trust, i.e. providing medical relief to the public and, therefore, the running of CMC is for the attainment of the main object of the assessee-trust. In the case of Sivakasi Hindu Nadars Uravinmurai, relied upon by the ld. D.R., the Madras High Court has held that exemption in respect of assessee's income cannot be granted merely because objects of trust are charitable. The facts in the case before the Madras High Court were that the assessee had claimed exemption in respect of income from hiring of furniture and marriage hall purely for profit and these activities had nothing to do wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice operations etc. By referring to the definition of 'charitable purposes' given in section 2(15), the Hon'ble Apex Court held that the benefit of exclusion from total income is taken away when in accomplishing a charitable purpose, the institution engages itself in activities for profit. However, the Supreme Court observed that a little surplus left over at the end of the year does not mean that the assessee was carrying on such activity for purpose of profit. As would be seen from the subsequent paragraphs, in the present case, the net result from running CMC is a loss. Therefore, it could not be said that the assessee was running CMC only for profit motive. This issue was also considered by the IT AT, Amritsar Bench in the case of Ch. Aishi Ram Batra Charitable Trust. In the said case, the Tribunal held that if a property, including running business, was held for charitable and religious purposes and fulfilled all conditions envisaged under section 11 and did not come under any of exceptional clauses under section 13, the Assessing Officer cannot deny benefit provided to such trust under section 11. It was also held that for carrying on charitable purposes, trust could have act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e would alone be not entitled to exemption as per section 11(4A). This is not the case here. Thus, we do not find any merit in such submission of the ld. D.R. 15. The next objection of the ld. D.R. is that for the purpose of claiming exemption in respect of income from business, the assessee was duty bound to maintain separate books of account as per provisions of section 11(4A) of the Act. No doubt sub-section (4A) provides that running of business activities should be subject to the conditions mentioned in subsections (1) to (3A) of section 11 and further requires that trust should maintain separate books of account in respect of such business. It is no doubt true that assessee has not maintained separate books of account in respect of running of nursing home and other allied activities. But as mentioned earlier, the assessee derived income from nursing home, interest on FDRs/other investments, agricultural income and miscellaneous rental receipts etc. The assessee has not incurred any expenses in respect of interest income. Therefore, the same can easily be determined on the basis of receipts. The assessee has maintained separate account for receipts and expenses of agricultur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e properties at Panchsheel Park, New Delhi and agricultural land situated at Village Barkatabad, Tehsil Jhajjar, District Rohtak. One of the two properties at Delhi was sold and the assessee realized the sale proceeds amounting to Rs. 3.29 crores in the accounting year relevant to assessment year 1995-96. Page 2 of the paper book, which is a copy of the balance sheet as on 31-3-1996, shows that sale proceeds were held in the corpus of the trust, as all the immovable properties owned by the trust also constituted the corpus of the trust. The assessee invested such sale proceeds in the fixed deposits and investments and earned interest aggregating to Rs. 32,13,031. As already discussed, net result from running of nursing home, i.e., CMC and other related activities was a loss. Likewise, the net result from agricultural farm was also a loss. The only income was income from interest. Since such income was earned from the property held by the trust, the same was eligible for deduction under section 11 subject to fulfilment of other conditions. 17. It is clear that assessee donated a sum of Rs. 29 lakhs to SUKES out of interest income. Now, the question that requires to be considered i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Moreover, as per provisions of section 11 of the Income-tax Act, even SUKES was required to utilize the funds for the objects for which it was created. Any misutilization of funds or utilization of funds other than the objects of the society would disentitle the recipient-society to exemption under section 11 of the Income-tax Act. It has rightly been held by the ld. CIT(A) that once donation is given by the assessee and the money has parted company, the assessee loses control or power to resort to legal course to recover the amount so donated. Therefore, this fact cannot be held against the assessee. 18. The next important part, which requires to be examined by us is that the Revenue has emphatically argued that SUKES was used as a conduit by the assessee-trust with a view to divert funds to the business adventures of Brar family. At the time of hearing before us, the ld. Counsel was asked to furnish a list of trustees of the assessee-trust. Such list has been furnished. The same does not show that any members of Brar family were the trustees. In fact, the ld. Counsel submitted that none of the member of the Brar family ever remained trustee of the assessee-trust. The trust deed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xemption to the income given by way of donation to SUKES. The revenue was required to establish that the donation had been diverted to any of the persons mentioned in sub-section (3) of section 13 of the Income-tax Act. The revenue has relied on the judgment of Supreme Court in the case Bharat Diamond Bourse. But in that case, the assessee had advanced a sum of Rs.70 lakhs without interest and security and also without any written agreement to one 'B' who was one of the persons subscribing to its memorandum of association and also its honorary secretary. The assessee was also not able to establish that amount advanced to 'B' was actually given for acquisition of a suitable premises. The person to whom amount was given was found to be falling in the prohibitive category mentioned in section 13(3A) r/w section 13(1)(c)(ii) of the Income-tax Act and, therefore, it was held that assessee was not entitled to exemption of such income. But in the present case, the revenue has failed to establish that the persons to whom SUKES had diverted the funds were actually persons falling in the prohibitive category mentioned above. Therefore, this judgment is not applicable to the facts of the pres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... given donation to another institution would not disentitle the assessee for exemption under section 11. 18.4 As regards reliance of the ld. D.R. on subsequent Instruction No. 1582 dated 19-10-1984 issued by the CBDT modifying earlier Instruction No. 1132 dated 5-1-1978, the field authorities have only been asked not to give unqualified benefit to the donor trust under section 11 where the application of income for charitable purposes is made through the medium of the donee-trust. The field officers have been asked to satisfy themselves whether the funds donated to the donee-trust have been utilized for charitable purposes. But we find from the assessment order that at the time of completing the assessment, the Assessing Officer had merely held that donation given to SUKES did not qualify for exemption because the same was not in accordance with the objects of the assessee-trust. He had neither made any inquiry nor given any finding that such funds have actually been diverted to the business ventures of Brar family. In any case, the members of Brar family do not fall in the prohibitive category so far as assessee-trust is concerned. Further, the assessee had also donated a sum of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tal to attainment of the objectives of the assessee-trust. Briefly stated, the facts of the case are that the Assessing Officer observed that assessee had debited and credited certain amounts on account of agricultural operations at its Naraingarh farm. According to the Assessing Officer, such income or loss did not relate to the objects of the trust and, therefore, such income/loss was not entitled to exemption under section 11 of the Income-tax Act. 20. Being aggrieved, the assessee carried the matter in appeal before the CIT(A). It was submitted before the CIT(A) that assessee-trust held certain agricultural land, which formed corpus of the trust. It was thus contended that income derived by way of agricultural operation represented income of the trust. The ld. CIT(A) considered these submissions and found that agricultural lands were bequeathed to the trust by Dr. P.M. Chuttani and these were part of corpus of the trust. These lands could not be left vacant or fallow and the income derived therefrom held for charitable purposes represented income of the trust. She also held that earning of income from such operations was not inimical to the objects of the trust provided the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is no question of including the same for the purpose of allowing exemption under section 11 of the Income-tax Act. Reliance is also placed on the decision of Madhya Pradesh High Court in the case of Nabhinandan Digamber Jain. Thus, income/loss from agricultural properties held under a trust is to be separately computed and cannot be given set off against income from non-agricultural properties held under the trust eligible for exemption under section 11. The assessee has not disputed the agricultural income computed by the Assessing Officer at loss of Rs.2.49 lakhs. In the light of these facts and circumstances of the case, we are of the considered opinion that ld. CIT(A) was not justified in allowing set off of loss against other income for the purpose of allowing exemption under section 11 of the Income-tax Act. We, therefore, set aside the order of the CIT(A) and restore that of the Assessing Officer. This ground of revenue's appeal is allowed. 24. Before parting with the case, we would like to record our appreciation for the painstaking, strenuous and excellent representation made by the ld. CIT (D.R.), Shri Girish Sharma. 25. In the result, the appeal of the revenue is p ..... 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