9911796707
TMI Blog2022 (4) TMI 1122X X X X Extracts X X X X X X X X Extracts X X X X ..... 12AA of the Income Tax Act (in brevity the Act). The assessment was made u/s. 143(3) for assessment year 2013-14 by the Ld. ACIT(E), Circle-1, Mangaluru. The Ld. Assessing Officer (in brevity the AO) calculated the deduction u/s. 11(1)(a) at the rate of 15% on actual receipt of the assessee & passed the order accordingly. The total gross income for the financial year 2012-13 is Rs. 9,95,44,952/-. The Ld. AO calculated the actual receipts of the assessee amount to Rs. 2,11,16,139/-. Accordingly calculated the deduction u/s. 11(1)(a) at the rate of 15% which is amount to Rs. 31,67,421/-. On other hand the assessee calculated the deduction u/s. 11(1)(a) amount of Rs. 60,65,330/- on gross income. The assessee filed an appeal before the Ld. CIT( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee can accumulate or set apart 15% of such income for the said purposes. From the provision of the section it is very clear that it refers to real income and not hypothetical income. Income which has not been actually received cannot be applied for any religious or charitable purposes. So there is no question of accumulating or setting apart for such purposes. Therefore, I am of the considered view that the appellant cannot claim deduction u/s. 11(1)(a) on the income which has not been actually received during the year. Accordingly, I uphold the order of the AO so far as it relates to the issue of deduction u/s. 11(1)(a) of the Act. Accordingly, this ground of appeal raised by the appellant fails." 5. The Ld. counsel of the assessee poi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the plain language of the above provision, it is clear that a charitable or religious trust is entitled to accumulate twenty-five per cent of its income derived from property held under trust. For the present purposes, the donations the assessee received, in the sum of Rs. 2,57,376, would constitute its property and it is entitled to accumulate twenty-five per cent thereout. It is unclear on what basis the Revenue contended that it was entitled to accumulate only twenty-five per cent of Rs. 87,010. For the aforesaid reasons, the civil appeal is dismissed. No order as to costs. 6. We heard the rival submission. In the observation of the Ld. CIT(A) is mentioned that the deduction should not be on hypothetical income. But the gross in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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