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TMI Blog2024 (8) TMI 338X X X X Extracts X X X X X X X X Extracts X X X X ..... pon by assessee, we have noted are all either distinguishable on facts or have been rendered without considering the clear provision of law as noted above by us. The decisions therefore are of no assistance to the assessee. No reason to allow the ground raised by the assessee before us, seeking exemption u/s 11(1)(a) of the Act of corpus donations received - Appeal of the assessee is dismissed. - MRS. ANNAPURNA GUPTA, ACCOUNTANT MEMBER AND SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER For the Appellant : Shri Ankit Chokshi, AR For the Respondent : Shri Ashok Kumar Suthar, Sr DR ORDER PER ANNAPURNA GUPTA, ACCOUNTANT MEMBER: Present appeal has been filed by the assessee against order of the Commissioner of Income-tax (Appeals), National Faceless Appeal Centre (NFAC) [hereinafter referred to as CIT(A) for short] dated 03.08.2021 passed under Section 250 of the Income-tax Act, 1961 [hereinafter referred to as the Act for short], for the Assessment Year (AY) 2016-17. 2. Ground raised is as under:- 1. On the facts and circumstances of the case of your appellant, Ld. CIT(A) has erred in confirming the disallowance made by the Ld. AO of capital expenditure of Rs. 99,12,380/- Therefore your a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he law has been amended, inserting Explanation 4 5 to section 11(1) of the Act, denying deduction u/s 11(1)(a) of the Act to corpus donations. That the amendment does not have retrospective operation. 7. We, however, find no merit in the contention of the Ld. Counsel for the assessee. We have carefully gone through the relevant provisions of law as applicable to the impugned year, A.Y. 2016-17, and we find that the law is clear and unambiguous in denying exemption u/s 11(1)(a) to corpus donations. Corpus donations, even prior to the amendment made to the Act w.e.f. 01-04-22, were not entitled to exemption u/s 11(1)(a) of the Act. 8. Section 11(1)(a) of the Act grants exemption only to Incomes derived from Property held under Trust and corpus donations, as per law, do not qualify as such Incomes as per section 12(1) of the Act. The provision of section 11(1)(a) is reproduced hereunder : 11. (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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is as clear as crystal, therefore, that exemption u/s 11(1)(a) of the Act is not available to corpus donations. Section 11(1)(a) r.w.s. 12(1) of the Act brings out very clearly the position of law that corpus donations are not entitled to exemption u/s 11(1)(a) of the Act. There is no ambiguity in law. 13. Further the provisions of law clearly bring out that the corpus donations are distinct and separate from Incomes derived from Property held under Trust and accordingly both incomes are granted exemptions separately u/s 11(1)(a) and 11(1)(d) of the Act. There is no overlapping of exemption granted to corpus donations therefore both u/s 11(1)(a) and 11(1)(d) of the Act. A bare reading of the provisions of Section 11(1)(a) to Section 11(1)(d) of the Act reveal that it lists different categories of incomes which are exempt from tax. Income from property held for charitable or religious purposes. 11. (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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt class/species of income of charitable trust, which is received by way of voluntary contribution with the specific direction that they shall form corpus of the trust. 16. Thus, Section 11, which lists the different incomes which are exempt from tax, prescribes only two categories of such income; first, income derived from property under Trust, and second, income in the form of voluntary contributions received by charitable trust with the direction that they shall form corpus of the trust. It is amply clear that income listed in clause (d) is not overlapping and, is distinct and different from income listed in clause (a) of Section 11(1) of the Act. 17. This is further reinforced by the fact that the definition of income provided in Section 2(24) of the Act specifically lists voluntary contributions received by trusts created wholly or partly for charitable or religious purposes as being in the nature of income. Section 2(24) is reproduced hereunder: - 2 (24) income includes (i) profits and gains ; (ii) dividend ; (iia) voluntary contributions received by a trust created wholly or partly for charitable or religious purposes or by an institution established wholly or partly for suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of corpus donations claiming exemption in law both under sub-clause (d) and sub-clause (a) of section 11(1) of the Act. 20. The above interpretation of law was confronted to the Ld. Counsel for the assessee during the course of hearing before us who was unable to point out any infirmity in the same. He however relied on various decisions but when asked whether any of the said decisions had interpreted the position of law considering section 11(1)(a) r.w.s. 12(1) of the Act, as above, he was unable to point out any. 21. The decisions relied upon by the Ld. Counsel for the assessee, we have noted are all either distinguishable on facts or have been rendered without considering the clear provision of law as noted above by us. The decisions therefore are of no assistance to the assessee. 22. In view of the above, we see no reason to allow the ground raised by the assessee before us, seeking exemption u/s 11(1)(a) of the Act of corpus donations received by it amounting to Rs. 99,12,380/-. In view of the above, the appeal of the assessee is dismissed. 23. In the result, the appeal filed by the assessee is dismissed. Order pronounced in the open Court on 03/05/2024 at Ahmedabad. - - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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