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TMI Blog2022 (2) TMI 532X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome from property held for charitable and religious purposes. Section 13 on the other hand pertains to cases where Section 11 would have no application. Sub-section (1) of Section 13 provides that nothing contained in section 11 or section 12 shall operate so as to exclude from the total income of the previous year of the person in receipt thereof under specified circumstances. Sub-section (2) of Section 13 provides that without prejudice to the generality of the provisions of clause (c) and clause (d) of sub-section (1), the income or the property of the trust or institution or any part thereof shall for the purposes of that clause would be deemed to have been used or applied for the benefit of a person referred to in sub-section (3), as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d against revenue. X X X X Extracts X X X X X X X X Extracts X X X X ..... m these concerns? (vi) Any other question of law as deemed fit in the facts and circumstances of the case may also be framed by the Hon'ble Court in the interests of justice." 2. Though multiple questions are framed, the principal issue on which strenuous arguments were made by the counsel for the revenue was with respect to the decision of the Tribunal regarding the purchases of ₹ 9 crores (rounded off) made by the assessee from one Pawansut Trading Company Pvt. Ltd. which was a specified person under Section 13(3) of the Income Tax Act, 1961 ('Act' for short). According to revenue this transaction would be covered within the mischief of Section 13(2)(g) of the Act. Remaining questions would not require elaborat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roperty of the trust for their personal benefits without justification which attracts provisions of sec. 13(1)(c) (ii)r.w. 13(2)(g) of the Act as such the assessee is not eligible to claim exemption u/s 11 and 12 of the Act." 4. The assessee carried the matter in appeal. The commissioner called for remand report and thereafter deleted the disallowance by observing that the rates of purchase by the assessee from the related party were same as with unrelated party. Further, there were no findings in the assessment order on the basis of which additions were made except that purchases have been made from the related party. The appellant has also proved that such purchases were made at the same rate as paid to unrelated party. 5. The dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lied for the benefit of a person referred to in sub-section (3), as provided in clauses (a) to (h) of sub-section (2). We are concerned with clause (g) which reads as under:- "(g) if any income or property of the trust or institution is diverted during the previous year in favour of any person referred to in sub-section (3): Provided that this clause shall not apply where the income, or the value of the property or, as the case may be, the aggregate of the income and the value of the property, so diverted does not exceed one thousand rupees;" 7. Clause (g) would be applicable in a case where any income or property of a trust or institution is diverted during previous year in favour of any person referred to in sub-section (3). ..... X X X X Extracts X X X X X X X X Extracts X X X X
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