9911796707
TMI Blog2005 (2) TMI 852X X X X Extracts X X X X X X X X Extracts X X X X ..... 33,948 collected by the assessee on account of charity did not constitute the assessee's income?" 2. The assessee is a registered firm. It is engaged in wholesale business of wine. For the assessment year 1973-74, the assessee filed return declaring an income of ₹ 1,36,820. It claimed deductions of ₹ 33,948 on account of charity. The Assessing Officer completed assessment under section 143(3) of the Income-tax Act, 1961 (for short, 'the Act') at an income of ₹ 1,76,080. While doing so, the Assessing Officer treated the entire amount on account of charity as revenue receipt and added the same to the total income of the assessee. He, however, allowed deductions under section 80G of the Act. The Appellate Assistant Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (P.) Ltd. (supra), the amount collected with the sale proceeds was on account of sales-tax but in the case of the assessee, the amount collected with the sale proceeds was specifically and exclusively meant for charity. In respect of the said sum collected by the assessee by way of charity, the assessee was only a trustee and this would be apparent from the fact that a sum of ₹ 22,956 was disbursed to different parties in this year, and the balance of ₹ 10,990 was carried over for similar disbursements in the subsequent years. The revenue has not made any submission that the amount collected for charity was not disbursed for purposes of charity. We would thus hold that the sum of ₹ 33,948 did not constitute the assessee's ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ic purpose of being applied to local charities, the surcharge, when paid, was clearly impressed with an obligation in the nature of trust for being applied for the benefit of local charities, and was by that obligation diverted before it reached the hands of the respondent and at no stage became part of the income of the respondent. It is settled law that a trust may be created by any language sufficient to show the intention and no technical words are necessary and it may even be created by the use of words which are primarily words of condition. The only requisites which must be satisfied are that there should be 'purposes independent of the donee to which the subject-matter of the gift is required to be applied and an obligation on the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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