Government Grants for specific purpose cannot be treated as Income of Assessee

Howrah Improvement Trust Vs DCIT (ITAT Kolkata) The appellant, Howrah Improvement Trust, received grants from the Government of West Bengal for infrastructure projects within the district of Howrah. The trust maintained separate accounts for general-purpose funds and specific-purpose funds. While the general-purpose fund was treated as income and subjected to income tax, the specific-purpose fund was considered corpus and not offered as income under Section 11(1)(d) of the Income Tax Act. During the assessment proceedings, the Assessing Officer disallowed a portion of the grants that were dire...