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TMI Blog1983 (11) TMI 104X X X X Extracts X X X X X X X X Extracts X X X X ..... r s. 12 of the Act. The assessee received donations from different parties amounting in all to Rs. 45,352. Each of the donors issued a letter to the assessee-trust saying that they wished to donate the same to the trust on the condition that the donated amount should be credited towards the corpus of the trust. Subsequently they gave the donations. The case of the assessee was that the donations came within the exemptions stated in s. 12 of the Act namely they were received from the donors with a specific direction that the donations shall form a part of the corpus of the Trust and so they should not be treated as income for the purpose of s. 11 of the Act. The ITO did not agree because, in his opinion, the letters given by the donors did n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n laid down by the donors, because, had it been so, the donor would not have given the donation at all. Further, he stated that it is not necessary that the amount treated as corpus according to the directions of the donors should be kept unspent for ever. If the terms of the Trust Deed authorised the spending of even the corpus amount, under certain emergencies or other contingencies, then the Trustees could spent the said amount; and if they so spent the same, then the conditions of s. 12 were not infringed. He explained that in order to come within the exception to s. 12 and go out of the purview of the income, all that was necessary was a specific direction by the donor at the time of giving the donation and what followed thereafter is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s the facts on record. We find force in the contentions raised for the assessee. On going through s. 12 of the Act, we find that the only condition laid down therein is a specific direction by the donor at the time of giving the donation to the effect that the donation should form a part of the corpus of the trust. If this condition is satisfied, then the donation ceases to be the income for the purpose of s. 11 of the Act. The word 'corpus' has not been defined in the Act. Hence, it has to be taken to be the fund which is not meant to be spent as current revenue but which is required to be held as a fund to produce income that could be spent. Clause 3 of the Trust Deed of the assessee before us authorises the spending even out of the corpu ..... X X X X Extracts X X X X X X X X Extracts X X X X
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