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TMI Blog1988 (11) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... vested in Government securities in view of section 11 of the Income-tax Act, 1961, and not the entire amount of accumulation ?" We are concerned with the assessment years 1966-67 and 1967-68. For the assessment year 1967-68, the assessees claimed refund of tax deducted at source. The Income-tax Officer did not dispute that the assessees, as trustees of a charitable trust, were entitled to claim exemption under section 11. He disputed the contention of the assessees that they had made an investment which was sufficient compliance with the requirement of clause (b) of sub-section (2) of section 11. The assessees had given a notice as required by clause (a) of sub-section (2) and had invested a sum of Rs. 29,055 in Government securities. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer and the Appellate Assistant Commissioner were in error and allowed the appeals. The relevant portions of section 11, as they read at the relevant time, are these : "(1) Subject to the provisions of sections 60 to 63, the following income shall not be included in the total income of the previous year of the person in receipt of the income (a) income derived from property held under trust wholly for charitable or religious purposes, to the extent to which such income is applied to such purposes in India; and, where any such income is accumulated for application to such purposes in India, to the extent to which the income so accumulated is not in excess of twenty-five per cent. of the income from the property or rupees ten thousand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h removes the restriction placed by subsection (1) in regard to accumulation. The conditions relate to the giving of a notice and investment in Government securities. In the context of the removal of the restriction placed by sub-section (1), the phrase "the money so accumulated" in clause (b) of sub-section (2) must be read as referring only to the accumulation that is made in excess of the already exempted 25%. It is only the excess over 25% of the income which is required to be invested in Government securities. Upon a construction of section 11, therefore, we must hold that the Tribunal was right in the view that it took. We are supported in this by the judgments of five High Courts, viz., CIT v. Shri Krishen Chand Charitable Trust [1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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