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TMI Blog2020 (1) TMI 1083X X X X Extracts X X X X X X X X Extracts X X X X ..... Disallowance of claim of accumulation of unutilized funds - We find that the issue in dispute on this issue is unutilized portion of fund of ₹ 18,50,000/- for A.Y. 2008-09. The same has been held to be taxable by the Assessing Officer u/s. 11(3) of the Act. This aspect has been upheld by learned CIT(A) on the ground that any specified unavoidable circumstances is not on record. This he held so by observing that if any specified period expires then it is the option to assessee to revise the purposes cannot be exercised. He held that while perusing the document filed by the assessee, he did not find anything contrary to the observation of the AO Therefore in the absence of any specified unavoidable circumstances on record to modify purpose, he declined to interfere with the finding of the Assessing Officer. In our considered opinion it is nowhere emanating as to whether the learned CIT(A) has confronted this aspect or not. In our considered opinion interest of justice demands this issue may be remitted to the file of the Assessing Officer. The Assessing Officer is directed to consider the issue afresh after giving the assessee opportunity of being heard. - IT APPEAL NOS. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s claim of deduction u/s 24(a) of the IT Act of ₹ 35,06,448/- on the income from property held under trust wholly for charitable or religious purpose is denied and ₹ 35,06,448/- claimed by the appellant is added to the total of the appellant. 4. Upon assessee's appeal learned CIT(A) upheld the same holding as under:- 6.3 I have considered the facts of the case and the submissions made by the appellant. In this context it is relevant to note that section 11(1) provides that 'the following income shall not be included in the total income of the previous year ..'. The reference in section 11(1) and sub section (a) is invariably to 'income' and not to 'total income'. Total Income' has been specifically defined in Section 2(45) of the Act as 'the total amount of income referred to in section 5, computed in the manner laid down in this Act'. Therefore, the word income used in section 11(1A) is distinct to the expression 'total income' vide section 2(45) of the IT. Act, 1961. The CBDT in its Circular No. 5 LXX-6 of 1968 dated 19.06.1968 further explained that 'where the trust derives income from H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g of the above makes it amply clear that the provisions of the Act do not provide any restriction whatsoever that any category of tax payer is excluded from this deduction. Identical view was expressed by the ITAT in the case of ADIT v. Sri Sathya Sai Trust [IT Appeal no. 7350 (Mum) 2011, vide order dated 25-3-2013] and in that case the ITAT has held that the assessee a Trust was eligible for deduction u/s. 24 @ 30% of the rental income. We find that the view adopted by learned CIT(A) is erroneous in the light of the express provisions of the Act. It is settled law that the provisions of the Act have to be construed in a strict manner, when there is no ambiguity whatsoever in the provisions of the Act. Hence, extrapolation made by learned CIT(A) that the Trust shall not be entitled for deduction u/s. 24 of the Act in computation of income from house property is totally unsustainable in law. As a matter of fact, the proposition that income has to be computed as per provisions of the Act even in the case of Trust was approved by Hon'ble Bombay High Court in the case of CIT v. Institute of Banking Personnel Selection (IBPS) [2003] 131 Taxman 386/264 ITR 110, wherein capital expend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed accumulation of AY 2008-09'. The contention of the appellant that the unspent accumulation is set aside for the same purpose of constructing school and college is not permissible as per sec 11(2) of the Act. It is because, the unutilized accumulation of the appellant of AY 2008-09 is in the nature of deemed income , whereas sec 11(1) uses the phrase income derived from property for the purposes of allowing the benefits of accumulation u/s 11(2) of the Act . Thus, the deemed income u/s 11(3) should not be taken as part of the income derived from the property for accumulation purpose as claimed by the appellant in its computation. I find the AO has rightly excluded ₹ 18,50,000/- out of the assessed total income to arrive at the accumulation u/s 11(2) of the Act. 7.3.2 In regard to the alternative claim of making an application u/s 11(3A) of the Act, the appellant's application to utilize unspent accumulation for such other charitable purpose in conformity with the object of the Trust was not allowed by the Assessing Officer in absence of any documentary evidence to establish the situation as 'beyond control' . The provision of sec 11(3A) allows to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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