2012 (5) TMI 866 - HC - Income Tax

Summary

Issues involved:
The issue involves the entitlement of a trust registered u/s 12AA of the Income Tax Act, 1961 to set-off brought forward losses against income, specifically focusing on the application of income towards charitable purposes.

Summary:

Issue 1: Entitlement for set-off of brought forward losses
The revenue appealed u/s 260A of the Income Tax Act, 1961 against the Tribunal's order regarding the set-off of brought forward losses. The assessee, a trust running an educational institution, claimed depreciation and carry forward of losses which was initially disallowed. The CIT (A) allowed the claim, leading to the revenue's appeal. The Tribunal, relying on judgments of the Bombay and Gujarat High Courts, upheld the allowance of set-off. The High Court concurred with the Tribunal's decision, stating that the issue was concluded against the revenue based on the mentioned judgments. Therefore, the appeal was dismissed.

Conclusion:
The High Court upheld the Tribunal's decision regarding the entitlement of the trust to set-off brought forward losses against income, based on legal precedents from the Bombay and Gujarat High Courts.