TMI Blog1982 (2) TMI 52X X X X Extracts X X X X X X X X Extracts X X X X ..... ust was styled as " Visha Nima Charitable Trust ". The assessees before us are, the trustees of the said trust. The object of the said trust was, inter alia, to acquire and maintain a charitable home in Bombay for providing temporary accommodation to persons for the purposes of study, medical, treatment and such other charitable purposes. Clause 6 of the said deed of, trust authorises the trustees thereof to invite and receive or without such invitation receive voluntary contributions from any per son or persons and institutions and members of the public by way of donations, legacies or otherwise for all or any of the charitable objects set out earlier in the said deed of trust. The said clause, inter alia, provides as follows : " All su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thereafter invested mainly in fixed deposits with the Dena Bank. On February 27, 1965, that is, within the year of account ended March 31, 1965, with which we are concerned, agreements were entered into by the trustees with certain builders for acquiring six ownership flats Which became ready in subsequent years. The amount collected was used for the payment of the, price of these ownership flats. The ITO took the view that the said income was income from property held under a trust wholly for charitable purposes, which would have been exempt from tax under the terms of s. 11(1)(a) of the said Act if applied to such purposes but since it was accumulated for application to such purposes it was held that exemption was available only to the e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r corpus of the trust? 3. If the answer to question No. 1 is in the negative, whether the receipts in question were, exempt from tax under section 12(1) of the Income-tax Act, 1961, as income derived from voluntary contributions ?" 4. Whether, on the facts and in the circumstances of the case, the contributions received by the assessee-trust were derived from property held under trust is contemplated under section 11 of the Act ?" Before considering the submissions advanced by the respective counsel before us, we propose to set out sub-s. (1) of s. 12 of the said Act, as it stood at the relevant time. The said provisions read thus: "12, Income of trusts or institutions from contributions.(1) Any income of a trust for charitable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unsel for the assessee, that the so-called consideration, referred to by Mr. Joshi, was merely illusory and that the real motive which induced these contributions to he made to the assessee was charity. It was urged by Mr. Trivedi that the entertainment offered was such that no one would have paid the high price charged for the tickets merely to see the entertainment and that even in respect of the advertisement space purchased in the, souvenir, the real purpose could not be to advertise the products. In appreciating the aforesaid arguments advanced by the learned counsel of both the sides, it is necessary to bear in mind that the assessee is a trust which seems to have been formed primarily by the members of a particular caste, although ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and bringing out souvenirs for raising funds and obtaining donations by way of tickets and advertisements are purely of a voluntary nature and there could be no element of quid Pro quo in these transactions. In these circumstances, it appears to us that the contributions made by way of tickets and for advertisements should, on the facts and circumstances of this case, be regarded as merely voluntary contributions and in view of this the exemption contained in sub-s. (1) of s. 12 of the said Act would be clearly attracted, even assuming that these receipts constituted the income of the assessee and not the corpus thereof. Question No. 3, referred to us is, therefore, answered in the affirmative and in favour of the assessee. In the view whic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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