2002 (3) TMI 4 - HC - Income Tax

1. Whether, the Tribunal is right in law in holding that the assessee is entitled to deduction under section 80L? - 2. Whether, Tribunal is right in law in holding that denial of exemption under section 11 should be restricted to the income arising from investments which are in contravention of the provisions of section 13(1)(d) of the Act and that the Income-tax Officer should re-examine the assessee s claim in the light of its decision in the case of Thuluva Vellala Association? - As the assessee is entitled to exemption of its income under section 11 of the Act, there is no need to invoke section 80L of the Act. It is therefore unnecessary to answer the first question, as it does not survive for consideration.

Summary

The High Court of Madras ruled that a charitable trust is entitled to the benefit of section 11 of the Income Tax Act, despite investments made contrary to requirements. The retrospective amendment allows for this benefit for assessment years after April 1, 1983, and before March 31, 1993. Therefore, the trust does not need to invoke section 80L for exemption. The court did not address the first question regarding section 80L as it is unnecessary.