TMI Blog2014 (11) TMI 1111X X X X Extracts X X X X X X X X Extracts X X X X ..... the restriction u/s 11(5) applies. We are in complete agreement with the reasonings adopted by the CIT(A) as well as Tribunal. In the case of Fr. Mullers Charitable Institutions (2014 (2) TMI 1033 - KARNATAKA HIGH COURT) held that a perusal of section 13(1)(d) of the Income-tax Act, 1961 makes it clear that it is only the income from such investment or deposit which has been made in violation of section 11(5) of the Act that is liable to be taxed and violation under section 13(1)(d) does not result in denial of exemption under section 11 to the total income of the assessee and that where the whole or part of the relevant income is not exempted under section 11 by virtue of violation of section 13(1)(d) of the Act, tax shall be levied on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of Section 11(5) of the Act and only that income which is earned in violation of Section 11(5) of the Act could lose exemption? 2. The assessee trust had filed its return of income for the assessment years in question declaring its total income as NIL. During the course of assessment proceedings the Assesing Officer found that the trust had invested amount in Gujarat Lease Finance Ltd (GLFL) and claimed exemption u/s 11(5). The Assessing Officer was of the opinion that the investment made by assessee with (GLFL) is not a specified investment and hence assessee is not entitled for exemption u/s 11(5) and accordingly the Assessing Officer disallowed the claim of exemption and the entire amount was added to the total income. 2.1 B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come Tax and Another vs. Fr. Mullers Charitable Institutions reported in 363 ITR 230 wherein also similar view is taken. 5. Having heard learned advocates for the parties we are of the opinion that the Tribunal was justified in upholding the order passed by CIT(A). The CIT(A) has very clearly observed that the provisions of Section 11(1)(a) are very clear and provide that the income derived from the property held under trust shall not be included in the income to the extent it is applied for the charitable or religious purposes (expenses incurred during the year) or accumulated/set apart to be applied for that purpose in future out of 75% to which the restriction u/s 11(5) applies. The Tribunal has relied upon its own decision on a simi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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