Income received from a charitable/religious trust will be tax-exempt under Section 11, provided that the activity being performed is incidental to the attainment of objectives set by the trust/institution, and separate books of account are maintained by the particular trust/institution pertaining to the business. In this article, we look at some of the major exemptions provided under Section 11 of the Income Tax Act.
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The ITAT Delhi affirmed the grant of Section 11 exemption to a charitable society, ruling that if the Assessing Officer fails to make a mandatory reference to the DVO to question a valuation, the registered valuer’s report must be accepted. Since the purchase price was lower than the valuer’s estimate, no benefit accrued to related persons.
The ITAT Chennai restored a trust’s appeal to the AO to verify if the asset’s cost was allowed as application of income before disallowing depreciation under Section 11(6) of the Income Tax Act.
ITAT Delhi confirmed that a statutory development authority’s activities, such as land development and housing, are charitable under Section 2(15), not commercial. The Tribunal applied the principle of consistency, relying on multiple High Court and ITAT precedents for similar development bodies.
Tribunal held that charitable or religious trusts that have surrendered their registration and do not claim benefits under Section 11 are to be taxed at normal slab rates applicable to AOPs, not at the maximum marginal rate. The ruling relied on CBDT Circular No. 320 of 1982.
ITAT Mumbai sets aside CIT(E) order, holding Mohanji Bharat Welfare Foundation’s 80G registration application was timely, interpreting the six-month deadline from provisional approval expiry.
The case addressed the disallowance of Rs.1.89 Cr, which the AO treated as a donation to other trusts and deemed income under S 11(3). The ITAT deleted the addition, ruling that payments made to other NGOs for executing charitable projects under the Trust’s supervision and control constitute genuine application of income, not donation.
NCLT Mumbai held that application under section 9 of the Insolvency and Bankruptcy Code for initiation of Corporate Insolvency Resolution Process (CIRP) against Cab-Eez Infra Tech Limited [Corporate Debtor] admitted as operational debt and default thereon established.
CESTAT held that confiscation of dry dates and penalties under the Customs Act were unjustified as the Department failed to prove the goods’ foreign origin. Opinions based on visual inspection were deemed without evidentiary value.
The Income Tax Appellate Tribunal (ITAT), Dehradun, quashed the retrospective cancellation of the charitable trust registration (Sec 12A/12AB) of Sushila Devi Centre. The Tribunal held that the PCIT (Central), Kanpur, acted without jurisdiction, asserting that only the CBDT-notified CIT (Exemption) possessed the authority to cancel such registrations under section 120.
ITAT holds that filing audit report late due to Covid-19 is a procedural lapse, not a ground to deny exemption, following Telangana and Gujarat High Court rulings.
