9911796707
TMI Blog1985 (11) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessment year 1971-72, the previous year ending on October 30, 1970, the assessee claimed a sum of Rs. 8,627 as money collected not as part of its income and, therefore, not liable to be taxed. The claim was disallowed and the amount was added. The contention of the assessee was that this sum was collected from its customers for the purpose of charity called " Shri Shubh Laga ". The Appellate Assistant Commissioner dismissed the assessee's appeal stating: " I have recorded in my order for the earlier year that the appellant was under no obligation, legal or practical, to hand over any part of its collections to any recognised charity. I have also pointed out that, in fact, large amounts have been paid by this assessee to personal fri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rds the misutilisation of the funds. That is a question which ought to have been investigated, for the answer to that question would have determined the character of the funds collected. The mere fact that money had been collected supposedly for charity would not mean that such amount did not become part of the income. The question is whether income had accrued. Income did result, whatever be the label under which money was collected, if what was collected was treated as income. It is not the label that decides the question, but the character of the money collected. If what was supposedly collected as charity, by bearing that label, was in fact utilised by the assessee for purposes other than charity, then such utilisation, though a subseq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vestigated. We should like to make it clear that the principle enunciated in the decisions cited above can hold good only if the facts showed that what was collected was in fact genuinely collected and validly earmarked and held as charity under an obligation to spend the sum solely for purposes of charity. This is a question which requires to be decided with reference to the facts of each case. In the circumstances, we are of the view that the Tribunal should consider the question as to whether what was said in the year earlier to the relevant accounting year was also true of the present accounting year, and, if so, whether such facts negatived the claim of the assessee. This is a matter for the Tribunal to determine. In the circumstanc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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