9911796707
TMI Blog1986 (11) TMI 77X X X X Extracts X X X X X X X X Extracts X X X X ..... ce are disposed of by a common order. 2. The assessee is a trust. The first grievance common to both the assessment years is that the claim of exemption as laid down under section 11 of the Income-tax Act. 1961 ('the Act') was wrongly net allowed by the Commissioner (Appeals). Here is will be necessary to point out that the commissioner (Appeals) in his order has allowed the claim of exemption as laid down under section 11 on the income from house property amounting to Rs. 47,197 for the assessment year 1981-82 and Rs. 48,642 for the assessment year 1982-83 and the claim of exemption is, therefore, limited to the other incomes, which was only business income for the assessment year 1981-82 and business income and income from long-term capi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment allowance was wrongly not entertained. 5. The assessee's learned counsel, Shri Mehta, submitted to us that once the income was held not exempt and liable to tax, it must follow as a corollary that the income should be determined in accordance with the provisions of the Act. Even otherwise, according to Shri Mehta, the prescribed return of total income in the case of assesses claiming exemption under section 11 (Form No. 3A) in item 7 of Part I provides for deduction of unabsorbed losses or allowances brought forward from the earlier years under section 32(2), 35(4) and 72 to 79 of the Act and investment allowance/development rebate/development allowance under section 32A (3) /33(2) /33A (2) of the Act and this supports the contention ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... departmental representative, Shri Subramanian, submitted to us that where the assessee was a trust the income has to be computed in accordance with the provision of Chapter III of the Act, and the other provisions of the Act mentioned in other Chapters of the At, have no application. He, therefore, submitted that there was no question of carry forward of the business loss determined for the assessment year 1981-82 and its set off against the income for the assessment year 1982-83 or the allowance of the claim of investment allowance in working out the business income for the assessment year 1982-83. Coming to the claim of deduction of provision for gratuity amounting to Rs. 27,582, Shri Subramanian referred to the ruling of the Hon'ble Sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therefor, vehemently argued before us that both the rulings cited by the learned departmental representative, Shri Subramanian, do not apply in the present case. 8. We have carefully considered the rival submissions Chapter III deals with incomes, which do not form part of the total income. i.e., in other words, incomes which are exempt under the various provisions of section 10 To 13A of the Act. Viewed in this context when the income of the assessee-trust other than income from house property was held to be not entitled to exemption under any of the provisions of Chapter III, it automatically follows that the income from these sources will have to be worked out under the provisions of other Chapters. It might perhaps not be out of place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essment year 1981-82 against the income from business for the assessment year 1982-83 and the amount, if any, which could not be set off can be carried forward to the following assessment years and so on and so forth up to the limit laid down under that section. We, however, find that the assessee's claim of carry forward of business loss assessed for the assessment year 1981-82 against the business income for the assessment year 1982-83 has not been examined from this angle. We, therefore, direct the ITO to examine the assessee's claim in the light of our observations in this order and determine the reliefs, if any, admissible to the assessee-trust accordingly. 9. It also follows as a corollary that in working out the business income unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... owance contemplated under section 40A (7) (a) does not apply to any provision for the purpose of payment of any contribution towards an approved gratuity fund. Viewed in this context, it is not under dispute that this amount of Rs. 27,582 was a provision for payment to an approved gratuity fund where the period of approval covered the previous year relevant to this assessment year, the amount of provision was actually paid in April 1981 and the other amounts on account of provision for payment to this very fund amounting in the aggregate to Rs. 2,62,314 had already been allowed by the ITO as a deduction in working out the business income for the assessment year 1981-82. We have, therefore, no hesitation in holding that this amount of Rs. 27 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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