TMI Blog1998 (12) TMI 106X X X X Extracts X X X X X X X X Extracts X X X X ..... ssing Officer determined an income of Rs. 41,714 for the assessment year 1982-83 and Rs. 76,200 for the assessment year 1983-84. The assessments have been confirmed in first appeal by the Dy. Commissioner of Income-tax(A), Hyderabad, in her order dated 9-7-1993 passed in appeal No. IT/ ATP/3 4/90-91. It is against the dismissal order of the Dy. Commissioner of Income-tax(A) that the assessee has come in second appeal before the Tribunal. 2. When the proceeding was called for hearing, nobody appeared for the assessee in spite of notice. But, the assessee has already filed paper-book in which the assessee has appealed to the Tribunal to decide the appeals on the facts and materials of case as available on record. In the circumstances, we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenses but has not allowed the amounts spent by the assessee by way of construction of houses, reclamation of land, etc. That is why, the Assessing Officer could make out the assessments on taxable incomes of Rs. 41,714 for the assessment year 1982-83 and Rs. 76,200 for the assessment year 1983-84. 6. The contentions raised by the assessee are that grant received from Bread for the World could not be treated as income of the assessee as the grant was tied-up with conditions and specifications, that unspent balance, if any, had to be returned to the donor, that the amounts spent for construction of houses, land reclamation, etc., have to be allowed as deductible expenditure and, therefore, the assessed income and tax demanded have no basi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se villagers / agriculturists who are the beneficiaries. The purpose and activity of the assessee-society is to engage in such charitable activities. Whatever amount has been spent on those programmes / projects, they were spent in the usual course of carrying on its acclaimed objects. Therefore, there is no basis whatsoever, factual or legal, to hold that the amounts spent by the assessee in constructing houses or reclaiming land are capital expenditure. As far as the assessee is concerned, those expenses are revenue expenses. The assessee has no right or title over those properties. Those expenses were incurred as part of its normal activities for which the society was formed. Therefore, the money spent by the assessee-society in construc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... parate account of the donor. That incoming and outgoing need not be reflected in the income and expenditure account of the assessee. At the end of the project, the balance, if any, available to the credit of Bread for the World, the donor, could be treated as income of the assessee, if the donor did not insist for the repayment of the balance amount. 12. Therefore, in the light of the examination of the facts of the case, we direct the Assessing Officer to redo the assessments in the following lines : (1) The tied-up grants received from the donor. Bread for the World, will be taken out of the computation of income from the income-side. (2) All the money spent under the tied-up programmes directed by the donor also will be taken out o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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