TMI Blog2011 (3) TMI 1064X X X X Extracts X X X X X X X X Extracts X X X X ..... apsed. It is clear from the above that the assessee had the time, as per the aforesaid provisions, for disinvestment of the said shares which were received during the Financial Year 1991-92, i.e. relevant assessment year 1992-93 (with which we are concerned, as this case relates to the assessment year 1992-93). The question could have arisen, if at all, in the assessment year 1993-94. Thus agree with the aforesaid view taken by the Tribunal answer the question in favour of the assessee. - 383 OF 2008 - - - Dated:- 30-3-2011 - A.K. SIKRI AND M.L MEHTA, JJ. Ms. Prem Lata Bansal, Deepak Anand and Vijay Mishra for the Appellant. C.S. Aggarwal and Prakash Kumar for the Respondent. JUDGMENT A.K. Sikri, J. The aforesai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s passed on 26-3-2002. In this order, the Assessing Officer took note of the plea of the assessee that it had received equity shares of the face value of Rs. 62.50 lacs of various companies as donation. However, the Assessing Officer was of the view that it was necessary for the assessee to dispose of the same within one year from the end of the year in which they were received and because of these irregularities committed by the assessee in not disposing the shares within the stipulated period, the provisions of section 13(1)(d)(iii) were attracted, thereby losing the benefit of section 11 of the Act. He, thus, denied the exemption to the assessee provided under section 11 of the Act and computed the income of the assessee at the rate of R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which the asset was acquired or with effect from 31-3-2003 whichever is later. This contention of the assessee predicated on the judgment of the Madras High Court in the case of CIT v. Kumudam Endowments [2000] 242 ITR 159/[2001] 117 Taxman 716 was accepted by the CIT(A) in the following manner: "10. I have gone through the case law cited before me and also the observations made by the JDIT in his directions under section 144A vide para 5.2 on the issue. I am of the view that the finding recorded by the Hon'ble Madras High Court in the case of the CIT v. Kumudam Endowments (supra) has not been followed. The exemption to the trust must not be denied for the period under appeal. Accordingly, I hold that the appellant trust is entitled for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied. Thus, the legal position for the year under consideration is that the assessee was allowed to hold investment contrary to provision of section 11(5) of the Act under an obligation to disinvest on or before 31-3-1993, without losing the benefits of sections 11 and 12 of the Act. This is in line with the parity of reasoning taken by the Hon'ble High Court of Madras in the case of Kumudam Endowments 242 ITR 159 (Mad.). Thus, the holding of such investment for the year under consideration cannot be made the basis to reject the exemption under sections 11 and 12 of the Act. Thus, the holding of such investment for the year under consideration cannot be made the basis to reject the exemption under sections 11 and 12 of the Act. Thus, the con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould be denied the benefit thereof when any of the eventualities provided under section 13 of the Act occurs inasmuch as section 13 of the Act mandates that the benefit under section 11 of the Act would not be applicable. She argued that in this backdrop, provisions of section 13(1)(d)(iii) of the Act were to be seen. This provision reads as under: "13. Section 11 not to apply in certain cases. (d) in the case of a trust for charitable or religious purposes or a charitable or religious institution, any income thereof, if for any period during the previous year (i) .. (ii) . (iii) Any shares in a company, other than - (A) shares in a public sector company; (B) shares prescribed as a form or mode of investmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... institution maintains separate books of account in respect of such business." 9. Thus, argument is that any shares in a company held by the trust or institution after the expiry of one year from the end of the previous year in which such asset is acquired or the 31st day of March, 1993, whichever is later, the same would not qualify for benefit under section 11 of the Act. 10. There is no dispute about the aforesaid proposition advanced by the learned counsel for the Revenue. However, as can be seen from the impugned order of the Tribunal extracted above, these shares were to be disinvested upto 31-3-1993 or within one year from the end of previous year in which they were acquired, whichever is later. Thus, shares could be disinvested b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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