TMI Blog1996 (7) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... r short " the Act "), registered as R. A. No. 145/Ind. of 1992, arising out of the order dated May 25, 1992, passed by the Tribunal in I. T. A. Nos. 1053/Ind. of 1990 and 114/Ind. of 1991 for the assessment year 1987-88 : " Whether, on the facts and in the circumstances of the case, the Tribunal was justified in allowing the income of the assessee as exempt under section 11 of the Income-tax Act, 1961 ? " Miscellaneous Civil Case No. 31 of 1994.---The Department had filed the aforesaid application proposing three questions. By order dated March 30, 1993, passed on such application, registered as R. A. No. 145/Ind. of 1992 the Tribunal stated the case but referred only one question, as noted above. Thus two questions, questions Nos. 1 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he order of the assessment on March 29, 1990 (annexure " A "). On appeal, the Commissioner of Income-tax (Appeals) concluded that the assessee was entitled to exemption under section 11 of the Act. He reached this conclusion on the assumption that section 13 of the Act nowhere stated that exemption could be withdrawn for contravention of any of the provisions of any law. He, therefore, held that withdrawal of exemption on the ground that the assessee had contravened the provisions of the M. P. Lottery (Niyantran Tatha Kar) Adhiniyam, 1973, and the provisions of the Income-tax Act (by failure to deduct T. D. S.) was not in conformity with law (annexure " B "). The order of the Commissioner of Income-tax (Appeals) dissatisfied both the partie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee. The Assessing Officer proceeded on the linchpin that there was sufficient justification to withdraw the exemption. The position of law is not in tenebrosity. The conditions under which exemption is not available to a particular income are chronicled in section 13 of the Act. The Commissioner of Income-tax (Appeals) considered the position of law and concluded that exemption from payment of tax was not liable to be withdrawn on the ground of contravention of the provisions. The assessee was thus allowed the benefit of exemption under section 11 of the Act. It is trite law that exemption once earned is not lost lightly. In Mangalore Chemicals and Fertilisers Ltd. v. Deputy CCT [1991] 83 STC 234; AIR 1992 SC 152, it is held that el ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of exemption under section 11 of the Act. The conclusion is not shown to be perverse. In fact the question proposed is not of perversity at all. They reached the conclusion that there was no contravention of any of the provisions of the M. P. Lottery Adhiniyam and as such the assessee-trust was entitled to the benefit of section 11 of the Act. The Tribunal also reached the conclusion that the grant-in-aid of Rs. 10 lakhs was towards the corpus of the trust and it could not be treated as income of the trust. Nothing substantial is urged to demolish the conclusion. In the result, we find that the question referred to in Miscellaneous Civil Case No. 335 of 1993 merits to be answered in the affirmative, i.e., in favour of the assessee and aga ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t was received on March 22, 1986, for the assessment year 1986-87. The Tribunal declined to refer these two questions because the conclusion was based on appreciation of facts and there was no question of any legal acrobatics. In CIT v. Ashoka Marketing Ltd., [1976] 103 ITR 543 (SC), and in CIT v. Kotrika Venkataswamy and Sons [1971] 79 ITR 499 (SC), it is held that a conclusion based on appreciation of facts does not give rise to any question of law. Section 11 of the Act pertains to income from property held for charitable or religious purposes and details the income excludible from the total income and section 13 of the Act provides the instance where section 11 is held inapplicable. The Commissioner of Income-tax (Appeals) and the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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