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TMI Blog2015 (10) TMI 2840X X X X Extracts X X X X X X X X Extracts X X X X ..... ulation as provided under section 11(2) of the Act. The assessee had received Rs. 11,23,70,948/-, however, during the year, it had spent only Rs. 3,84,70,751/-. The assessee submitted Form 10 for accumulation of Rs. 6,76,48,808/- under section 11(2) of the Act for the purpose of "salary and welfare of patients". The Assessing Officer found the said accumulation not made as per law and assessed it as AOP at Rs. 6,76,48,808/-. The reasons for such conclusion arrived at by the Assessing Officer were that the objects specified in Form No. 10 for accumulation of income were too vague and further there was no need for assessee to accumulate funds for the purpose of salary as it has enough funds including grants received from State Government for this purpose. 3. Aggrieved by the order of the Assessing Officer the assessee went in appeal before the learned CIT (Appeals). It was submitted that the assessee is a charitable trust having 12A registration certificate from Commissioner of Income Tax, Shimla. It is carrying on its activities with hundred percent financial aid from Government of Himachal Pradesh. The trust has been created by the State Government for the welfare of patients. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stated objectives in Form No. 10 are vague and historically the surplus money generated has also not been used for charitable purposes. 5. Aggrieved by the order of the learned CIT (Appeals) the assessee has come up in appeal before us. The learned counsel for the assessee while arguing before us stated that the assessee is a society registered under section 12A of the Act since 2005. The aims and objects of the society are duly covered under the definition of section 2(15) of the Act. There is a provision in section 11(2) of the Act that in case the assessee is not able to spent 85% of its receipts for the stated objectives, it can accumulate the same, the only requirement is to file Form No.10 before the Assessing Officer. During the year under consideration, the assessee has not been able to spent 85% of its receipts and Form No.10 was duly filed before the Assessing Officer. The contention of the Assessing Officer is that the objectives for which the receipts had been accumulated as described in Form No.10 are vague. He drew our attention to the copy of Form No.10, whereby the objectives for which accumulation was sought for is stated to be "salary of staff and welfare of pat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r specialty services in the Medical College and appointments of higher paid doctors were also to be made, therefore, in anticipation more funds were required in the next year. The accumulation of unspent portion of the receipts was earmarked for the said purpose. In view of these submissions, it was prayed that the action of the Assessing Officer may be held to be invalid. 7. The learned D.R. relied upon the orders of the Assessing Officer as well as of the learned CIT (Appeals). He also placed reliance on the judgment of Hon'ble Calcutta High Court in the case of Director of Income Tax (Exemption) Vs. Trustees of Singhania Charitable Trust, 199 ITR 819 to the effect that for a charitable trust to be eligible for accumulation of income beyond the previous year under section 11(2) of the Act, the purpose of such accumulation must be specific. In this view, it was prayed that the orders of the Assessing Officer and the learned CIT (Appeals) be held as per law. 8. We have heard the learned representatives of both the parties, perused the findings of the authorities below and considered the material available on record. The only issue to be decided by us is that whether in the gi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g that the income was sought to be accumulated by the assessee to achieve the object for which the assessee was incorporated. It was not the case of the Revenue that any of the objects of the assessee-company were not for charitable purpose. The finding by the Tribunal was essentially a finding of fact giving rise to no question of law." In another case of Delhi High Court in DIT (Exemption) Vs. Daulat Education Society reported in (2006) 278 ITR 260 (Del), it is held that details of plan to be given is not necessary, if the purpose specified is in consonance with the objects. The judgment of Hon'ble Calcutta High Court in the case of Trustees of Singhania Charitable Trust (supra) as relied upon by the learned D.R. is distinguishable on facts as in that case all the objects as per law of the assessee were specified as the purpose of accumulation, which is not the case of the present assessee. 9. In view of the above, we find that there is no vagueness in the purposes specified by the assessee in Form No.10. 10. The other issue raised by the Assessing Officer to deny the benefit of accumulation is that the assessee has enough funds for the purposes of salary to be paid in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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