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TMI Blog2012 (12) TMI 779X X X X Extracts X X X X X X X X Extracts X X X X ..... ty in the order passed by CIT(A), affirm the order of CIT(A) and dismiss the appeal filed by the revenue - Appeal of Revenue dismissed. - I.T.A.No. 4283/Mum/2011 - - - Dated:- 6-6-2012 - Shri D. Manmohan Shri Rajendra JJ. Assessee by : Shri Mundar Vaidya Department by : Shri Pavan Ved ORDER Per D.Manmohan (VP):- This appeal is filed at the instance of the revenue and it pertains to A.Y. 2007-08. 2. The assessee is admittedly an Association of Persons (Trust) registered with Charity Commissioner as well as u/s.12A of the Income Tax Act, 1961. The principal objects of the Trust are religious and educational activities - extending benefits to all persons irrespective of religion, caste or gender. For A.Y. 2007-0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt claim of higher accumulation can be made only by way of revised return and not otherwise. He accordingly restricted the claim u/s. 11(2) to a sum of Rs. 1,02,00,000/- only. 6. Aggrieved, the assessee contended before learned CIT(A) that publishing and printing activity is one composite activity for which separate books of account are maintained i.e. donations account, Foreign contribution account and Printery account. The aggregate depreciation provided in accounts was Rs. 6.09 crores under following heads :- Donation and foreign contribution : Rs. 4,02,36,909.34 Printery Account : Rs. 2,07,45,117.72 ------------------------ : Rs. 6,09,82,027.06 ------------------------- Depre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0 under Rule 17 at any time before completion of assessment proceedings. He accordingly accepted the alternative contention of the assessee. 9. Aggrieved by the order of learned CIT(A), the revenue is in appeal before us. 10. Learned Departmental Representative submitted that section 11(1) of the I.T. Act refers to donations etc. received by the assessee which are liable for taxation unless otherwise shown to have been applied for charitable purposes. In otherwords, there should be application of income for charitable purposes. The expression such income is applied to such purposes refers to actual expenditure and it does not include deduction towards depreciation. In the instant case the assessee-Trust claimed deduction of depreciati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bmit that double deduction is not permissible whereas Hon'ble Bombay High Court had overlooked the decision of Hon'ble Apex Court in the case of Escorts Ltd. Ors. (supra). In the alternative he contended that the legislative intention can be understood from the language used in section 14A of the Act whereby no expenditure is allowable in respect of income which is exempt. In the instant case the actual cost of the assets was met by the assessee by availing exemption in the form of application of income and thus on application of section 43(1) of the Act it cannot be said that any deprecation can be allowed to the assessee since actual cost has to be reduced by the amount met from other sources (in the instant case from exempt source). He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eriod of expiry of six months hence, it is contrary to the procedure prescribed therein and hence even on that account, the benefit provided u/s. 11(2) cannot be availed of by the assessee. He thus strongly supported the order passed by the Assessing Officer. 11. On the other hand learned counsel appearing on behalf of the assessee submitted that learned CIT-DR advanced its arguments on certain assumptions which are contrary to facts. In this regard he referred to page 3 of the statement of facts, filed before learned CIT(A), wherein the assessee categorically stated that all the conditions laid down in section 11(2) are fulfilled and funds were set apart for investment before the end of the previous year and fresh notice in Form No. 10 w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of larger Bench has to be preferred. 13. With regard to the main contention that the assessee is entitled to claim deduction towards depreciation the assessee relied upon the Circular issued by the CBDT (No. 5P dated 19.6.1968) which in turn was referred to and applied in the following cases :- M/s. Sri Rengalatchumi Educational Trust (ITA Nos. 681 682/Mds/2010 ITA Nos. 89 90/Mds/2009 dated 25.3.2011) DIT Vs. Framjee Cawasjee Institute (109 CTR 463)(Bom) CIT Vs. Institute of Banking (264 ITR 110) (Bom) (Decision of Supreme Court in the case of Escorts Ltd. considered and distinguished) M/s. Bommanji Dinshaw Petit Parsee (ITA No. 3259/Mum/2011 dated 20.3.2012) Parmeshwaridevi Gordhandas Garodia Charitable Tru ..... X X X X Extracts X X X X X X X X Extracts X X X X
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