Case Law Details
Anusandhan Trust Sai Ashray Vs ITO (ITAT Mumbai)
ITAT Mumbai held that Hon’ble jurisdictional High Court order in case of CIT v Gem & Jewellery Export Promotion Council has held that none of the conditions attached to the grant affected the voluntary nature of the contribution and accordingly they would be exempt under section 12 of the Act and it is settled law that decision of Hon’ble jurisdictional High Court is binding upon subordinate Tribunal and courts.
Facts-
AO noted from the Income & Expenditure account that the assessee has received grant of Rs. 3,76,58,808/-. AO asked the assessee trust to explain as to why the Govt. grant is considered as income even though it is granted for specific purpose.
AO pointed that the assessee trust has received the grant of Rs. 3,76,58,807/- for specific purposes for disbursement of salary, it has no discretion to utilize the fund as per own requirements. The grants received by the assessee do not belong to the assessee trust. It is also found that in case of non-utilization, the funds are to be refunded to the Funding Agency. Moreover, the assessee itself accepted that trust has not treated the above grants as income and trust has maintained a separate Bank Account for obtaining and maintaining the grants. The grants do not form corpus of the assessee nor it is income of the assessee as per section 11 of the Act. Such grants are not the donation or voluntary contributions under section 12 of the Act, Thus, the grants received by the assessee trust should not be considered either as income or for ascertaining the amount expended or amount to be accumulated.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
