Case Law Details
CIT Vs St. Thomas Cathedral Church (Kerala High Court)
The issue to be decided is, whether the income derived out of Kuri business conducted by the Charitable Trust is eligible for exemption or not, in view of sub-section (4A) introduced to Section 11 of the Income Tax Act with effect from 01-04-1984.
A Division Bench of this court in Commissioner of Income Tax V. Dharmodayam Co. (1997) 225 ITR 686 held that, if the Kuri business is held in trust, the income therefrom would not be governed by sub-section (4A) as has been held by the hon’ble Supreme Court in CIT V. Dharmodayam Co. (1977) 109 ITR 527 (SC).
In the said decision this court held that the Tribunal has correctly held that, the assessee is entitled to claim exemption under Section 11 (1) of the Income Tax Act with respect to its income from Kuri business. It is pointed out that decision of this court in (1997) 225 ITR 686 was set aside by the hon’ble Supreme Court in the decision in Commissioner of Income Tax V. Dharmodayam Co. and another (2001) 248 ITR 816.
It was held that until the introduction of Section 11 (4A) with effect from 1st April, 1984, the case of the assesse therein was governed by the decision of the Supreme Court reported in (1977) 109 ITR 527 (SC). But sub-section 11 (4A) has introduced certain conditions in the matter of application of sub-sections (1), (2) (3) & (3A) of Section 11.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
