TMI Blog2022 (1) TMI 640X X X X Extracts X X X X X X X X Extracts X X X X ..... of the trust within the time frame of 5 years. On a considered view of the matter, we have no hesitation in holding that the Revenue was not justified in denying the claim of accumulation merely on the ground that the reasons or object of the accumulation has not been specified and it is fact on record that the assessee has actually applied said funds to specific charitable purpose as resolved. The Revenue itself had accepted in the preceding assessment years the claim of accumulation under similar circumstances in assessment orders passed u/s 143(3) of the Act. Also, all other requirements like filing of Form 10 within due date and application of accumulated sum for the purpose of object of trust within the time limit of 5 years are fulfilled by the assessee. We accordingly direct the Assessing Officer to allow the claim of accumulation u/s.11(2) of the Act. Accordingly, grounds raised by the assessee are allowed. - ITA. No. 65/MUM/2021 - - - Dated:- 5-1-2022 - Shri C.N. Prasad, Hon'ble Judicial Member And Shri S. Rifaur Rahman, Hon'ble Accountant Member For the Assessee : Shri Hema Kataria For the Department : Shri B.K. Bagchi ORDER PER ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO s action of passing the assessment order u/s 143(3) and denying exemption thereunder, which is illegal and bad in law. 2. On the facts and circumstances of the appellant s case and in law, the Ld. CIT(A) erred in confirming the AO s action of denying exemption u/s 11 of the Income Tax Act, 1961 in respect of ₹ 1,95,00,000/- accumulated as per provisions of section 11(2) of the Act and thereby, making an addition of ₹ 1,95,00,000/-. 3. On the facts and the circumstances of the appellant s case and in law the Ld. CIT(A) erred in confirming AO s action of holding that the accumulation was not for the specified purpose and was not spent on the objects of the Trust. 4. On the facts and the circumstances of the appellant s case and in law the Ld. CIT(A) erred in confirming AO s action of holding that the appellant has violated the provisions of section 11(2) of the Income Tax Act, 1961. 7. The only grievance of the assessee as per the grounds raised are with regard to denial of benefit of claim u/s 11(2) of the Act. Hence, all the grounds are taken up together. 8. From a perusal of the assessment order, it is seen that the Assessing Officer has rejec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on by the assessee are held to be no longer applicable because the objects of the assessee are not covered under the provisions of section 11 of the Act. Therefore, a bland recitation in Form No. 10 that the funds are to be accumulated for the purposes specified in the resolution does not meet the conditions laid down in section 11(2) of the Act. It is another matter that even the Resolution extracted above is equally nonspeaking. The argument of the assessee that its minutes of the meeting of the trustees should also be considered has no legal sanctity or approval in any other case laws referred to above. Without prejudice to the same, it is seen that even the minutes of the meeting mention only the fact that the amount is being accumulated for the objects of the trust. After this general accumulation, there is a suggestion by one of the trustees that some further sum should be accumulated for medical etc. but the same has not been approved by the trust as seen in the Resolution finally passed. Further, it is also noted that the assessee has not been able to point out the utilisation of this accumulated fund in AY 2016-17. The assessee has merely claimed that the money h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee has passed the resolution in similar manner which was accepted in the earlier years and thus applying the principle of consistency, the claim is allowable in the current year too. The Ld.AR also drew our attention to the fact that the accumulated amount was utilized in the financial year ending on 31.03.2016 and that it can be seen from the financials for the year ending 31.03.2016 that as per the income and expenditure account the amount was utilized for the purpose of medical relief, relief of poverty education. 12. On the other hand, Ld. DR has vehemently reiterated the findings of the authorities below. 13. Considered the rival submissions and the materials placed on record. The Ld. Assessing Officer has disallowed the claim of assessee made u/s 11(2) of the Act on the ground that resolution passed in the meeting does not specify the concrete object for which the accumulation has been made. During the course of hearing, Ld AR brought to our notice the financials for the year ended 31.03.2016, as per the financials assesse utilised the accumulated sum for medical purpose in the 5th year i.e., in the year ending 31.03.2016. On the contrary the Revenue could not brin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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