Powai Sthanakvasi Jain Sangh Trust Vs ITO (ITAT Mumbai)
ITAT Mumbai: Corpus Donations with Written Directions Exempt u/s 11(1)(d) – Addition of ₹1.74 Crore Deleted
Assessee, a registered charitable trust u/s 12AA & 80G, received ₹1.74 crore as corpus donations from 76 donors with written directions for the “building fund”. AO taxed it as income, holding that no charitable activity was carried out during the year. CIT(A) upheld this view.
Tribunal held that once donations are received with specific directions to form part of the corpus, they are exempt u/s 11(1)(d) irrespective of current-year activity. Assessee had produced confirmations, PANs & evidence of using funds to acquire flats later used for charitable purposes. The authorities erred in ignoring these facts.
Held: Corpus donations received with written directions cannot be treated as taxable income. Addition of ₹1.74 crore deleted.
FULL TEXT OF THE ORDER OF ITAT MUMBAI
This appeal filed by the assessee is against the order of CIT(A), National Faceless Appeal Centre (NFAC), Delhi vide order no. ITBA/NFAC/S/250/2024-25/1074570665(1), dated 17.03.2025 passed against the assessment order by National Faceless Assessment Centre, Delhi u/s.143(3) r.w.s. 144B of the Income-tax Act, 1961 (hereinafter referred to as the “Act”), dated 31.06.2021 for AY 2018-19.
