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TMI Blog2013 (12) TMI 1157X X X X Extracts X X X X X X X X Extracts X X X X ..... d in the circumstances of the case and in law, the Incometax Appellant Tribunal did not err in holding that the investment made by the assessee in the shares of Pravara Sahakari Bank Ltd. was not in violation of the provision of Section 11(5) and, therefore, Section 13(1)(d) would not be attracted? (2) Whether, on the facts and in the circumstances of the case and in law, the Incometax Appellate Tribunal did not err in failing to appreciate that Section 11(5) is an unambiguous provision and investment in shares of a Sahakari Bank, for whatever reasons and of whatever amount, is not permitted there under? (3) Whether, on the facts and in the circumstances of the case and in law, the order passed by the Incometax A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ance of objects of assessee trust. It was held that the shares of cooperative banks were acquired as a precondition for availing of the loans and the shares subscribed by the assessee in the said cooperative banks were quite miniscule visavis the loan raised. The subscription to the shares was not with an intention of investment, but only to comply with the precondition for raising loans. Besides, the impugned order holds that the acquisition of shares existed in the earlier assessment years also and in the course of a scrutiny assessment under Section 143(3) of the Act for the Assessment Year 2006-07 no adverse view was taken with regard to the assessee's entitlement for exemption under Section 11/12 of the Act. Thus, both on merits and on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee. 9. We find that the only basis of the revenue seeking to deny the benefit of exemption under Section 11/12 of the Act is that the share subscription amount is shown as investments in the balance sheet and investments in shares not being a specified mode, the benefit of exemption cannot be granted. It is well settled that the depiction in Books of Accounts is not a determinative test but the factual nature of the transaction which has to be considered for the purpose of taxation. In this case, the investment in shares of cooperative banks was a precondition for raising of loans and it was therefore not an investment as normally understood. The Tribunal has recorded a finding of fact that the shares were subscribed to only for ..... X X X X Extracts X X X X X X X X Extracts X X X X
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