TMI Blog2018 (7) TMI 748X X X X Extracts X X X X X X X X Extracts X X X X ..... ngaru Subbammal Educational Trust are identical, would not make M/s. PMR Bangaru Subbammal Educational Trust as having registration u/s. 12AA of the Act. M/s. PMR Bangaru Subbammal Educational Trust must on its own independent status claim and have the registration u/s. 12AA of the Act. In the absence of such registration, dealing with such an unregistered trust would affect the exemption available to the assessee. Where violation of sub-section (2) of section 13 takes place the benefit, directly or indirectly, to any person referred to sub-section(3) of Section 13, then the First provisions of section 13(1) clearly states that nothing contained in section 11 or section 12 shall operate so as to exclude from the total income of the prev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Revenue and Mr. S. Sridhar represented on behalf of the Assessee. 3. At the time of hearing, it was submitted by ld. A.R that the issue in the Cross Objections was in respect of claiming of depreciation, assessee being a charitable trust registered/s. 12AA of the Act. It was a submission that the issue of depreciation was squarely covered by the decision of the Hon ble Supreme Court in the case of CIT-III, Pune Vs. Rajasthan Gujarati Charitable Foundation Poona reported in (2018)402 ITR 441(SC). 4. In reply, the ld. D. R vehemently supported the orders of the ld. Assessing Officer and the Ld. CIT(A) on this issue. 5. We have heard both the parties and perused the material on record. As it is noticed that the issue of depr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and their family members had been incurred by the assessee trust. It was a submission that on appeal, Ld. CIT(A) had held that the gift of 6. 5 acres of land by the assessee-trust to M/s. PMR Bangaru Subbammal Educational Trust had been reversed by cancellation of the Gift Deed in subsequent year and M/s. PMR Bangaru Subbammal Educational Trust was also having similar objects of the assessee trust, consequently, there was no violation of provisions of the sections 13(1)(c) and 13(1)(d) of the Act. In regard to the payment of electricity bills, the Ld. CIT(A) had held that the amounts are very small and insignificant compared to the total volume of transactions and hence, it cannot be viewed as violation of Sec. 13(1)(c) of the Act. In regar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, only such part of income which is violative of sec. 13(1)(d) of the Act can be brought to tax at maximum marginal rate and entirety of income cannot be denied exemption u/s. 11 of the Act. It was a submission that the land had been returned by cancelling the Gift Deeds and in respect of the loans, which had been given the maximum that could be disallowed was the notional interest, in view of the decision of Hon ble Madras High Court in the case of CIT Vs. Working women s Forum reported to supra. It was a further submission that perusal of the calculation of the exemption as given in page-17 of the order of the CIT(Appeals) would show that the actual application during the year being much higher, the disallowance, if any would not make a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have been used for the benefit of a person referred to in sub-section (3), in clause (g), if any income or the property of the Trust or institution is diverted during the previous year in favour of any person referred to in sub-section(3) (regarding electricity bill payment) and in clause (h), if any funds of the trust or institution are, or continue to remain, invested for any period during the previous year ------ in which a person referred to sub-section(3) has substantial interest ( the loan given to M/s. PMR Bangaru Subbammal Educational Trust where the Managing Trustee is an interested person with substantial interest) and clause (b), if any land --- of the Trust or institution ---- for any period during the previous year without ade ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
