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Income Tax Appellate Tribunal, MUMBAI BENCH “SMC”, MUMBAI
Before: SHRI NARENDER KUMAR CHOUDHRY
O R D E R
Per : Narender Kumar Choudhry, Judicial Member:
1. This appeal has been preferred by the Assessee against the order dated 14.08.2025, impugned herein, passed by the Ld. Commissioner of Income Tax (Appeals) ADDL/JCIT (A) (in short Ld. Commissioner) u/s 250 of the Income Tax Act, 1961 (in short ‘the Act’) for the A.Y. 2016-17.
2. The Assessee during the AY under consideration has declared its total income at Rs. ‘NIL’ by filing its return of income on dated 13.09.2046, which was selected through CASS under “Complete Category” for the reason accumulation of profit in Trust continuously. Therefore, the Assessee was asked to furnish certain details and documents by issuing statutory notices u/s.143(2) and 142(1) of the Act, dated 03.07.2017 17.01.2018 respectively.
3. The Assessee in response to the said notices, furnished the requisite details called for viz. copy of return of income along with computation of income, copy of audited' accounts, income and expenditure account and balance sheet, audit report in Form 10B, letter of authority, copy of Trust Deed, certificate of Registration u 12A, certificate u/s. 80G, details of Trustees, etc.
The AO thus, perusing the aforesaid details and documents filed during the assessment proceedings, observed that the Assessee trust is registered with the Commissioner of Income Tax (Exemption), Mumbai u/s 12A under registration No.40409 and u/s 80G of the Act. The Assessee trust is also registered with the charity Commissioner, Mumbai and is engaged in the charitable activities. The main objects of the trust are: -
“i). To establish communal harmony between various communities, castes and work towards for the benefit of all the communities without any discrimination as to religion, caste, creed, gender or region. ii). To provide help to the downtrodden, suppressed by the caste and creed prejudices irrespective of the region, language or religion. iii) To establish orphanages, homes for the blind, dumb, aged, widows, handicapped and orphans and to persons in distress. iv) To promote education and to remove illiteracy among such downtrodden people and establish educational institution of all discipline”.
The AO further observed that the Assessee trust has not accumulated income u/s 11(2) of the Act for the “specific purpose”. It is mandatory that accumulation should be for “specific purpose” of future need. The Assessee has accumulated income of Rs.16,20,586/- for the general purpose/for the purpose of “to work towards all communities without any discrimination, as to religious, caste, creed, gender, education and social justice”.
The Assessee trust has failed to give specific or concrete purpose for which accumulation is required. Sub section (2) of section 11, which provides for the long term accumulation of the income and such long term accumulation should be for a definite and concrete purpose or purposes. Further, it is noticed from the copy of the resolution letter, that the purpose of accumulation has been mentioned as “to work towards communal harmony between various communities, caste and to work towards all the communities for relief of medical, relief of poverty or distress, relief for calamities and to hosts the Mother Teresa Memorial international award for social justice of public utility to felicitate selfless and intrepid individual, who have channeled all of their energies and creativities towards furthering the aim of social justice, as to encourage the society to imbibe these virtues of peace, which are an integral part in the Constitution of India. The resolution is also not accompanied by the minutes of meeting held in this regard, which shows that the resolution letter is given just to meet the requirements of scrutiny assessment proceedings.
6. The AO thus, in order to examine the case of the Assessee, show caused the Assessee vide letter dated 16.11.2018 u/s 142(1) of the Act “as to why accumulation of Rs.16,20,586/- claimed u/s 11(2) should not be denied and held as taxable income”.
7. The Assessee in response to the aforesaid show cause notice, filed its reply/submissions vide letter dated 21.11.2018, inter alia stating as under:
"
The main object of the trust to work towards communal and social harmony between various communities, castes and to work towards all the communities for relief of medical, relief of poverty or distress, relief for calamities and for social justice of public utilities without any discrimination as to religion, caste, creed, gender or region. The society need peace, tolerance, equality and social justice to function cohesively and to encourage inclusiveness. In order to make this a concrete and tangible reality, the Trust hosts the Mother Teresa Memorial International Awards for Social Justice of public utility to felicitate selfless and intrepid individuals who have channeled all of their energies and creativities towards furthering the aims of social justice as to encourage the society to imbibe these virtues of peace which are an integral part in the Constitution of India. In recent years, the thrust of Mother Teresa Memorial Awards and Harmony International Conference have been on the pressing humanitarian needs of the times. Beside this, the trust has spearheaded relief work during the Nepal floods in 2015, Kerala Floods 2018 by providing urgent essential and medical supplies. The trust compassionate intervention during natural calamities, also provide medical aid to the poor and needy, empowering children through education and provides education and provides educational support to underprivileged children, facilitated the rescue of many trafficked minors over the years. Therefore, we state that, the Income of the trust is applied for those charitable activities carried out by the trust and there is no change in object of the trust since date of inception of the trust. The accumulated Income is not applied during the year of receipt of the financial year is carried forward to subsequent year for application of accumulated income for those object of charitable activities and claimed exemption as per provision of section 11(2) of the Income Tax Act.
Further for claiming Exemption for Accumulation of Income in Excess of Specified Limit [Sec 11(2)], where 85% of income derived from trust property is not applied or is not deemed to have been applied to have been applied to charitable or religious purposes, but is accumulated or set apart for application to such purposes in India, Exemption can be claimed for the income so accumulated or set apart in excess of 15% limit, provided the following conditions are complied with: (a) statement in form 10 to be uploaded electronically within the time allowed for furnishing the return u/s. 139(1), notifying the amount being accumulated and the period of accumulation. In case form no. 10 is not uploaded before this date then the benefit of accumulation will not be available and such income will be taxable at appropriate rate.
(b) the period of accumulation does not exceed 5 years and (c) the money so accumulated is invested or deposited in modes or forms specified u/s.11(5). (d) From A.Y. 2016-17 benefit of accumulation is not available if return of income is not furnished before due date of filing return as per Sec. 139(1). The provision of section 11(2) is a concession provision to enable a charitable trust to meet the contingency where the fulfillment of any project within its object or objects needs heavy outlay calling for accumulation to amass sufficient money to implement it. As per section 11(2) and its conditions as above, the assessee trust has complied with all the conditions laid down under provisions of statute and the accumulated income u/s. 11(2) of Rs.16,20,586/-, which is 65% of the Income of the Trust, filed from no. 10 in time with specified reason for applications as per the object of the trust at the limited space provided under E from no.
10. As such, trust is not over ruled any provision of section 11(2).
However, your good self has mentioned in your Annexure to the notice that, assessee trust has not accumulated Income u/s. 11(2) of the Income Tax Act, 1961 for the 'specified purpose'. It is mandatory that accumulation should be for specific purpose of future need. The accumulated Income of Rs.16,20,586/- for the general purpose/ for the purpose of object of the trust. In response to this, we state that, the assessee trust has mentioned under form no. 10 with specified reason that to work towards all the communities without any discrimination as to religion, caste, creed, gender, education and social justice. Harmony Foundation's core focus is Social Justice. The objective is achieved through providing essential humanitarian aid and conducting awareness campaigns on various social issued that affect the society. The Foundation has partnered, facilitated and engaged with human rights activists and organizations in the rescue of trafficked minors from all over India for the past couple of years. Another important focus area has been to encourage participation and engagement of the youth in the area of social justice through youth consultations and awareness campaigns. A significant initiative has been the Child 10 Child Connect Initiative which was a humanitarian initiative for refugee children - sensitizing the student community to the needs of children in conflict situations where refugee support in terms of school essentials, toys and clothes for thousands of refugee children were distributed.
Every year, Harmony Foundation hosts the Mother Teresa Memorial Awards for Social Justice to felicitate selfless and intrepid Individuals who have channeled all their energies and creativities towards furthering the aims of social justice of public utilities as to encourage the society to imbibe these virtue of peace which are in integral part in the constitution of India. The applications of accumulations are within the object of the Trust. Therefore, we state that, the specification of certain purpose or purposes is needed for accumulation of income of the trust, and the same cannot be beyond the objects of the trust. The plurality of purpose for accumulation is not precluded, as long as the purpose was to achieve the objects of the trust, the trust cannot be denied for the benefit of entitlement of Section 11(2) of the Act. In support of our claim, we are relied upon the court decision taken by following cases:- a CIT v. Hotel & Restaurant Association (2003) 261 ITR 190/132 Taxman 76. b. DIT v. Mitsui & Co. Environmental Trust (2008) 303 ITR 111/167 Taxman 43. c. Director of Income Tax, Exemptions, Bangalore v. Envisions VINEETSARAN AND MRS. S. SUJATHA, (2015) 58 taxman.com 184. d. M. P. Gandhi Trust vs Assistant Director of Income Tax, Exemptions, 1(1) (2006) 8 SOT 808(MUM) ITAT. Commissioner of Income Tax Exemptions (Bangalore) vs. Gokule Education Foundation (2017) 7 taxman.com 38.”
The AO though considered the aforesaid reply/submission of the Assessee, however not being satisfied with the same, ultimately denied such claim of the Assessee qua accumulation of funds/income u/s 11(2) of the Act, by observing and holding as under:
“5.2.The claim of assessee u/s.11(2) is not allowable due to following reasons: - Section 11(2) reads as under:
"11(2) where eighty-five percent of the income referred to in clause(a) or clause(b) of sub-section (1) read with the explanation to that sub-section is not applied, or is not deemed to have been applied, to charitable or religious purposes in India during the previous year but is accumulated or set apart, either in whole or in part, for application to such purposes in India, such income so accumulated or set apart shall not be included in the total income of the previous year of the person in receipt of the income, provided the following conditions are complied with, namely: a) such person furnishes a statement in the prescribed form and in the prescribed manner to the to the assessing officer stating the purpose for which the income is being accumulated or set apart and the period for which the income is to be accumulated or set apart, which shall in no case exceed five years; b) the money so accumulated or set apart is invested or deposited in the forms or modes specified is sub-section (5). c) the statement referred to in clause (a) is furnished on or before the due date specified under sub-section (1) of section 139 for furnishing the return of income for the previous year. provided that in computing the period of five years referred to in clause (a), the period during which the income could not be applied for the purposes for which it is so accumulated or set apart, due to an order or instruction of any court, shall be excluded. Explanation: any amount credited or paid, out of income referred to in clause(a)or clause (b) of sub-section (1), read with the explanation to that sub-section, which is not applied, but is accumulate or set apart, to any trust or institution registered under section 12AA or to any fund or institution or trust or any university or other educational institution or any hospital or other hospital or other medical institution referred to in sub-clause (iv) or sub-clause (v) or sub-clause(vi) or sub-clause (via) of clause(23C)of section 10, shall not be treated as application of income for charitable or religious purposes, either during the period of accumulation or thereafter. From the plain reading of Section 11(2) of the 1.T. Act, 1961 as mentioned above, it is clear that the purpose for which accumulation is sought by filing Form No.10 has to specify specific objects. Unless objects are specific, how can income be applied? For Example, mentioning 'to work towards all communities without any discrimination as to religious, caste, creed, gender, education and social justice without specifying particular objects will not serve the purpose. It is clear that specific objects for which the income is accumulated are required to be mentioned in Form 10. It is not necessary that the assessee should accumulate for only one specific purpose. The assessee may have multiple purposes for accumulation but they have to be specific and realistic. 5.3 What the assessee has sought to be permitted to do here is to accumulate not for any determinate purpose or purposes but for the objects as enshrined in the trust deed in a blanket manner. Accumulation in such a global manner is definitely not in the contemplation of Section.11(2) when it is construed in its setting. 5.4 When Sub-section (2) of Section 11 requires specification of the purpose, it does so having in mind a statement of some specific purpose or purposes out of the multiple purposes for which the trust stands. Were it not so, there would have been no mandate for such specification. For, a charitable trust, in no circumstances, can apply its income, whether current or accumulated, for any purposes other than the objects for which it stands. The very fact that the statute requires the purpose for accumulation to be specified implies such a purpose to be a concrete one, an itemized purpose or a purpose instrumental or ancillary to the implementation of its object or objects. The very requirement of specification of purpose predicates that the purpose must have an individuality. 5.5 The provision of Sub-section (2) is a concession provision to enable a charitable trust to meet the contingency where the fulfillment of any project within its object or objects needs heavy outlay to call for accumulation to amass sufficient money to implement it. Therefore, specification of purpose as required by Section 11(2) admits of no amount of vagueness about such purpose. 5.6 The view is also supported by the decision of The Hon'ble Calcutta High Court in the case of Director of Income Tax (Exemptions) Vs. Trustees of Singhania charitable Trust (1993) 199 ITR 819 (Cal). The Hon'ble Court has not even allowed the plurality of objects. Also in the case of Bharath Kalyan Pratishthan Vs. Director of Income Tax (Exemption) (2008) 299 ITR 406 (Del), it was held that specification object is necessary. Further, in the case of Cotton Textile Export Promotion Council v. First ITO [1983] 4 ITD 642 it has similarly held that 'promotion of exports' is not valid purpose for accumulation under section 11(2). The Tribunal was of the view that it will be illogical to conclude that the ITO has no power to accept or reject the application. It is also open to the ITO to look into the purpose for which the accumulation is ostensibly made and if he comes to the conclusion that the accumulation is unreasonable, he can reject the proposal for accumulation.
5.7. Under the above circumstances, accumulation made u/s.11(2) of 1. T. Act, 1961 is hereby denied to the assessee. Penalty proceedings u/s.271(1)(c) of the I.T. Act are initiated separately for furnishing inaccurate particulars of income.”
The Assessee being aggrieved challenged the said addition on account of disallowance of accumulated income, by filing first appeal before the Ld. Commissioner, who vide impugned order affirmed the decision of AO in denying the accumulation made u/s.11(2), by dismissing appeal of the Assessee, observing and holding as under:
“6. Analysis The appeal challenges the Assessing Officer's (AO) denial of exemption under section 11(2) of the Income-tax Act, 1961, primarily on the ground that the purpose for which the income was accumulated lacked the requisite 'specific purpose. Each of the appellant's contentions is analyzed below, demonstrating their inconsistency with the statutory provisions and the established principles governing charitable trusts. 6.1. Ground of Appeal 1, 2, 3, and 5-Lack of Specific Purpose: 6.1.1. The appellant's assertion that stating "to work towards all communities without any discrimination as to religion, caste, creed, gender, education and social justice" in Form No.10 constitutes a sufficient purpose for accumulation is fundamentally flawed and inconsistent with the mandate of section 11(2) of the Act. Section 11(2) requires a definite, identifiable, and particular 'specific purpose' for the future application of accumulated income. This is not merely a procedural formality but a substantive condition designed to ensure that the tax benefits extended to charitable trusts are utilized for concrete, time-bound projects or activities. A general statement, which is essentially a reiteration of the trust's broad objects, fails to provide the necessary clarity on how the specific sum of Rs.16,20,586/- will be applied. 6.1.2. The distinction between the general objects of a trust and a specific purpose for accumulation is critical. While a trust's objects define its overall mission and range of activities, accumulation under section 11(2) is a special concession for setting aside funds for a distinct, future project that requires substantial outlay and cannot be met from the current year's income. The AO's emphasis on a "specific and realistic purpose" is entirely justified, as It aligns with the legislative intent to allow accumulation only for tangible and verifiable projects, rather than for vague or ongoing charitable endeavors. The appellant's argument that the limited space in Form No. 10 restricts their ability to provide detailed, object-wise information is a mere excuse and does not absolve them from the responsibility of identifying a precise purpose for which the funds are earmarked. Even within a limited space, a concrete project, such as "construction of a community skill development center" or "establishment of a mobile health clinic for rural areas," could have been specified. The lack of such a specific mention indicates an absence of a concrete plan for the utilization of the accumulated funds. 6.2. Ground of Appeal 4 - Interpretation of "Specific Purpose": 6.2.1. The appellant's contention that the term "specific" is not explicitly defined in section 11(2) and, therefore, the AO's interpretation is legally flawed, demonstrates a misapprehension of statutory interpretation. While the word "specific" may not be accompanied by a definition, its inherent meaning in the context of section 11(2)(a) and the legislative scheme of the Act implies a clear, identifiable, and definite objective for which funds are being set aside. This interpretation is not arbitrary but is derived from the necessity for accountability and effective monitoring of tax- exempt income. 6.2.2. The absence of a precise, specific purpose for accumulation would render the provisions of section 11(2) ineffective, allowing trusts to indefinitely hoard funds under the guise of broad charitable objectives without any concrete plan for their utilization. The requirement of specifying a "purpose" and a "period" (not exceeding five years) for accumulation inherently demands a degree of precision that allows the revenue authorities to ensure proper application of the funds within the stipulated timeframe. A general purpose fails to meet these underlying principles. 6.3. Ground of Appeal 6 - Reliance on Case Laws: 6.3.1. The appellant's reliance on various judicial pronouncements, including CIT v. Hotel & Restaurant Association and Bochasanwasi Shri Akshar Purshottam Public Charitable Trust, is misplaced or misconstrued in the context of the present appeal. While certain judgments may acknowledge the permissibility of multiple purposes for accumulation, provided they are within the main objects of the trust, these decisions do not dilute the fundamental requirement for specificity when it comes to earmarking funds under section 11(2). The term "plurality of purpose" does not equate to vagueness or generality. Each of the plural purposes must still be sufficiently definite and identifiable to allow for verification of its future application. 6.3.2. In the present case, the appellant has merely reiterated a general overarching objective of the trust, which cannot be construed as a specific project or activity for which the sum of Rs.16,20,586/- has been set apart. The cited cases generally deal with situations where the trust, though perhaps not perfectly articulating the purpose in Form 10, could nevertheless demonstrate a concrete future plan for the accumulated funds or where the context of the assessment was different. Here, the AO has explicitly highlighted the vagueness of the stated purpose, and the appellant has failed to provide any concrete or specific project details for the utilization of the accumulated income, either in their submissions or during the appellate proceedings. Therefore, the cited judgments do not provide any relief to the appellant's case where the stated purpose for accumulation is overly broad and lacks the necessary specificity required by the statute. 6.4. Contradictions and Flaws: 6.4.1. There are discernible contradictions and inherent flaws in the appellant's arguments. On one hand, the appellant claims to have duly complied with the requirements of section 11(2) by providing a purpose in Form No.
10. On the other hand, they seek to justify the generality of this purpose by citing perceived limitations in the format of Form No. 10 itself. This inconsistent stance highlights the appellant's inability to specify a clear, concrete, and identifiable project for the accumulated funds. 6.4.2. Furthermore, the appellant's reliance on broad objectives like "social justice," "communal harmony," and "humanitarian aid" without any tangible plan for the utilization of the accumulated sum of Rs.16,20,586/- demonstrates a fundamental lack of specificity. The examples of past charitable activities provided by the appellant (e.g., relief work during floods, rescue of trafficked minors) are instances of routine application of income, not specific future projects for which a distinct sum is accumulated. These arguments do not effectively counter the AO's reasoned conclusion that the purpose was general and not specific as required by law.
7. Conclusion 7.1. The appellant has failed to demonstrate that the accumulated income of Rs.16,20,586/-was for a 'specific purpose' as required by section 11(2) of the Income-tax Act, 1961. The stated purpose is too general and does not meet the statutory requirement.
7.2. The appeal is dismissed, as the appellant's contentions are incorrect and do not align with the provisions of the Act and judicial interpretations.”
Thus, the Assessee being aggrieved with the impugned order has preferred the instant appeal and contended that the Assessee has accumulated the amount of Rs.16,20,586/- u/s 11(2) for a period of 5 years, after complying with all the terms and conditions as prescribed u/s 11(2) of the Act. The Assessee every year hosts the ‘Mother Teresa Memorial Award’ for social justice to felicitate intrepid individuals, who have channeled all their energies and creativities towards furthering the aims of social justice public utilities, as to encourage the society to imbibe these virtue of peace, which are an integral part in the constitution of India. Further, the applications of accumulations are within the objects of the trust and thus the specification of certain purpose is needed for accumulation of income of the trust and the same cannot be beyond the objects of the trust. The plurality of purpose for accumulation is not precluded, as long as the purpose is to achieve the objects of the trust, the trust cannot be denied for the benefit of entitlement as enshrined in section 11(2) of the Act. The Assessee further claimed that the provision of section 11(2) of the Act, is a concessional provision to enable a charitable trust to meet the contingency where the fulfillment of any project within its object or objects needs heavy outlay calling for accumulation to amass sufficient money to implement it. The Assessee has complied with all the conditions laid down under the provisions of the statute and the accumulated u/s 11 of the Act of Rs.16,20,586/- which is 65% of the income of the trust specifically shown in Form No.10 in time with specified object. The Assessee further claimed that even otherwise in Form No.10 at Sl. No.1, a limited space was provided for mentioning the objects of the trust and therefore in the limited space, the Assessee has depicted one of main objects of the trust. However, it is a fact that vide resolution dated 27.08.2016 filed before the AO demonstrated the expansion of scope for applying the accumulated income, for the main purposes of the trust. Admittedly, the Assessee has not applied any part of the income outside the scope of objects of the trust. Even otherwise, in the provisions of section 11(2) of the Act, there is no mandatory requirement of mentioning any particular/specific purpose or application of the accumulated income.
On the contrary, the Ld. D.R. refuted the claim of the Assessee by drawing attention of this Court to the relevant provision of section 11(2) of the Act and by submitting that the Assessee was required to submit a statement to the AO, stating the specific purpose for which the income being accumulated. However, in this case, the Assessee just simply mentioned part its main objects, without specifying the purpose for applying the accumulated income and therefore the AO and the Ld. Commissioner have rightly disallowed the claim lodged by the Assessee and as such there is no perversity, impropriety and/or illegality in the impugned order specifically and therefore the appeal under consideration may be dismissed.
Having heard the parties and perusing the material available on record and giving thoughtful consideration to rival contentions of the parties, it is observed by this Court that the sole issue involved, relates to the mentioning of purpose in the statement given in Form No.10 for accumulation of the income/funds and claiming the deduction for the same.
Though the Assessee was/is having 04 main objects as reproduced above in this order, however, in Form No.10 has specified, the following object/purpose:
“ To work towards all communities without any discrimination, as to religious, caste, creed, gender, education and social justice”.
Thereafter, the Assessee during the Assessment Proceedings by filling resolution dated 27.08.2016, demonstrated the expansion of scope of application of accumulated income, which read as under:
“ To work towards communal harmony between various communities, caste and to work towards all the communities for relief of medical, relief of poverty or distress, relief for calamities and to hosts the Mother Teresa Memorial international award for social justice of public utility to felicitate selfless and intrepid individual, who have channeled all of their energies and creativities towards furthering the aim of social justice as to encourage the society to imbibe these virtues of peace which are an integral part in the Constitution of India.”
The AO though also taken cognizance of the such fact that the Assessee vide resolution dated 27.08.2016 has expanded the scope of application of the accumulated income, however discarded said resolution by observing that resolution is not accompanied by minutes of the meeting held in this regard, which shows that the resolution letter is given just to meet the requirements of scrutiny assessment proceedings.
For brevity and easy understanding, it would be appropriate to peruse the relevant provisions of section 11(2) of the Act, according to which, where 85% of the income is not applied or not deemed to have applied to charitable or religious purposes in India during the previous year but is accumulated or set apart, either whole or in part, for application to such purposes in India, such income so accumulated or set apart, shall not be included in the total income of the previous year of the person in receipt of the same, provided the following conditions are complied with.
a. Such person furnishes a statement in the prescribed format and in the prescribed manner to the AO stating the purpose for which the income is being accumulated or set apart and the period for which the income is to be accumulated or set apart, which shall in no case exceed 5 years; b) The money so accumulated or deposited in the forms or modes specified in sub section (5) c) The statement referred to in clause (a) is furnished on or before the due date specified u/s (1) of section 139 for furnishing the return of income for the previous year.
In the instant case, though the Assessee fulfilled all the conditions, as enshrined in section 11(2) of the Act, as both the authorities below have also not doubted the compliance thereof however, both the authorities below denied the claim of the Assessee mainly on the reason that the Assessee has not specified ‘any specific or concrete purpose’ for which accumulation was required. Whereas from the simple reading of the provisions of the Ac, it is clear that the Assessee is required to furnish a statement in the prescribed form and manner stating the purpose for which the income is being accumulated or set apart.
This Court further observes that identical issue has also been cropped up before the Hon’ble Delhi High Court in the case of CIT Vs. Hotel and Restaurant Association, {2003} 261 ITR 190 (DEL), wherein the AO declined to entertain the claim of the Assessee on the ground that in the statutory form, the specific object for which the income was sought to be accumulated was not indicated. However, on appeal, the Ld. Commissioner accepted the claim of the Assessee by observing that notice to accumulate income by the Assessee was in order, as the Assessee has passed a resolution to accumulate its income, so as to apply the same in India and the money had been invested in the specified securities. The said order of the Ld. CIT(A) subsequently affirmed by the Tribunal and thus the Hon’ble High Court on appeal, affirmed the Tribunal’s order by observing and holding as under:
“ 5. We have heard Mr. R. D. Jolly, learned senior standing counsel for the Revenue Mr. Jolly submits that the appellate authorities have failed to appreciate that in prescribed form the assessee had failed to indicate the specific purpose for w the income was sought to be accumulated and, therefore, the statutory requirement had not been strictly complied with, disentitling the assessee from relief under s. 11(2) of the Act.
We do not agree. It is true that specification of certain purpose or purposes needed for accumulations of the trust's income under s. 11(2) of the Act. At the time the purpose or purposes to be specified cannot be beyond the objects trust. Plurality of the purposes for accumulation is not precluded but it depends on the precise purpose for which the accumulation is intended. In the present case, both the appellate authorities below have recorded a concurrent finding that the income was sought to be accumulated by the assessee to achieve the object for which the assessee was incorporated. It is not the case of the Revenue that the objects of the assessee-company were not for charitable purpose. The aforenoted finding by the Tribunal is essentially a finding of fact giving rise to no question of law.
We, accordingly, decline to entertain the appeal. The same is dismissed.”
This Court further observes that the Hon’ble Gujarat High Court in the case of Commissioner of Income Tax (Exemption) Vs. Bochasanwasi Shri R. Axar Purushottam Public Charitable Trust (2018) 409 ITR 591 (Guj.) has also dealt with identical issue and held that even though the details furnished by the Assessee in Form 10 were not sufficient, however in the course of assessment , on being called upon by the AO, the Assessee having explained in detail the purpose of accumulation and thus requirement of section 11(2) stood satisfied and therefore the income was validly accumulated. The Hon’ble High Court also observed that the purpose or purposes to be specified cannot be beyond the objects of the trust. Plurality of the purposes for accumulation is not precluded but it depends on the purpose for which the accumulation is needed.
The Hon’ble Co-ordinate Bench of the Tribunal in the case of Arhatic Yoga Ashram Management Trust Vs. ITO (Exemptions) [ITA No.2920/CHNY/2017 decided on 20.01.2021, (2021) 188 ITD 14(Chennai) has also dealt with the identical issue and held as under:
"7. We have heard the learned Departmental Representative and perused the materials available on record. The assessee is a charitable trust claiming benefit of exemption under s. 11 of the Act, has accumulated income under s. 11(2) of the Act for specified purpose and for which Form No. 10 has been filed specifying the amount and purpose. The assessee has accumulated funds for poor children education fund and medical aid fund and claimed that purpose specified in Form No. 10 is in accordance with main objectives of the trust. We have gone through Form No. 10 filed by the assessee along with objects of the trust and find that objects of the trust specify extend help and relief to the distressed, poor destitute, homeless and underprivileged students and providing medical relief to the needy persons. Further, the assessee trust is regularly accumulating funds for the above purpose and such earmarked funds are continuously spent for the purpose for which they have accumulated. Once assessee has accumulated income with a specific purpose and such purpose is specified in the main objects of the trust, then the AO cannot deny such accumulation of income merely for the reason that purpose specified in Form No. 10 is vague and general in nature. As long as objects of the trust provide for such purpose, then the assessee can accumulates funds for the purpose which is specified in trust deed. This view is fortified by the decision of Hon'ble Gujarat High Court in the case of CIT (Exemption) vs. Bochasanwasi Shri Akshar Purshottam Public Charitable Trust (2018) 409 ITR 591 (Guj), where it was held that lack of declaration in Form No. 10 regarding specific purpose for which funds were being accumulated by the assessee trust would not be fatal to the exemption claimed under s. 11(2) of the Act. The Hon'ble Supreme Court (2019) 263 Taxmann.com 247 (SC) has dismissed SLP filed by the Department in the above case and has upheld the findings of the Hon'ble Gujarat High Court.
8. In this case, on perusal of facts available on record, cl. 4k of trust deed provides for extending help and relief to distressed and destitute, homeless and underprivileged and funds accumulated under s. 11(2) is covered under main objects of the trust. We, therefore are of the considered view that AO as well as learned CIT(A) has erred in denying benefit of accumulation of income under s. 11(2) of the Act. Hence, we direct the AO to delete the additions made towards denial of accumulation of income under s. 11(2) of the Act and direct him to allow benefit of accumulation as claimed by the Assessee."
Coming to the charitable activities carried out by the Assessee it is required to be seen, whether the Assessee carried out its activities, in pursuance to or within the parameters of its objects.
The Assessee has claimed the Assessee is conferring Mother Teresa Awards every year to the distinguished personalities, as a tribute to one of the greatest humanitarians of our time, Saint Mother Teresa, whose life was dedicated to serving the poorest, the suffering, and the forgotten. The Assessee’s aim is to embody the values of Mother Teresa, renowned for her compassion, service, and unconditional love for humanity. Awards honor individuals and organizations, who go beyond personal interest to serve the society, especially the poor, the vulnerable, and the marginalized. In a world where humanitarian efforts often go unrecognized, the Mother Teresa Awards act as a reminder that kindness, empathy, an selfless service and powerful forces for positive change. The awards to be an inspiration for others to follow the path of service. Thus, the Assessee has given/conferred awards to the exceptional personalities that to promote, encourage and generosity, serving as role models for people of all ages especially the youth, as detailed below: -
NOBEL LAUREATES (awarded so far)
(1) Narges Mohammadi (2023)- An Iranian human rights activist who has led fearless campaign against the death penalty and for women's rights despite imprisonment. She was honoured with MTMA for her extraordinary courage and sacrifice in defending freedom, justice, and hum dignity under oppressive conditions. (2) International Committee of the Red Cross (2023) - The ICRC is a neutral and independent humanitarian organization that protects victims of war, provides medical aid, reunites families, upholds humanitarian law worldwide. It received the MTMA for its unwavering commitments serving people in conflict zones with impartiality and compass
(3) Kailash Satyarthi (2019) A global child rights activist, Kailash Satyarthi has rescued 100,000 children from bonded labour, trafficking, and exploitation through the Bachpan Bacho Andolan. He received the MTMA for his lifelong dedication to child protection, education and freedom from exploitation. (4) Tawakkol Karman (2018) - Tawakkol Karman is a Yemeni journalist and Nobel Peace lam who advocates for democracy, human rights, and women's leadership. She was honored with MTMA for her courageous, non-violent activism for civil rights and democratic freedom in Yemen. (5) UNHCR (2017) - It protects and supports refugees and displaced populations globally by pro shelter, legal protection, and crisis relief. It received the MTMA for its decades-long humanitarian service to millions forced to flee conflict and persecution. 6) Medicines Sans Frontières (2015) - MSF is an international medical humanitarian organization that delivers emergency medical care in war zones, epidemics, and natural disasters. It was h with the MTMA for its fearless life-saving work in the most dangerous and underserved regions of the world. (7) Malala Yousafzai (2012) - She is a global advocate for girls' education who survived a Taliban attack and now leads the Malala Fund to empower girls through schooling. She received the MTMA for her extraordinary bravery and her unwavering commitment to ensuring education as a fundamental right for every girl. (8) H.H. The Dalai Lama (2010) - His Holiness the 14th Dalai Lama is a global symbol of peace, compassion, and non-violence, advocating for human rights and harmony. He was honoured with the MTMA for his lifelong work in promoting peace, compassion, and humanitarian values worldwide.
AWARDEES OF 2015
(1) Bilquis Bano - A renowned Pakistani nurse and co-chair of the Edhi Foundation, she was honoured for sheltering Geeta, a deaf and mute Indian girl who was stranded in Pakistan and cared for her for more than a decade. (2) Harakhchand Savla - The Founder of the Jeevan Jyot Cancer Relief & Care Trust in Mumbai, he has been tirelessly feeding cancer patients and their families, providing free medicines, accommodation, and emotional support. (3) Thomas Auto Raja-Once known as a criminal, he transformed his life into one of service by founding the New Ark Mission of India (NAMI), rescuing and caring for hundreds of destitute peoples whom he brought home in his auto, giving them shelter, food, and dignity.
(4) Narayanan Krishnan-A former chef who gave up his lucrative career to feed the homeless. mentally ill, and elderly on the streets of Madurai; he founded the Akshaya Trust, serving thousands o meals every day and offering rehabilitation. (5) Dr. Abhay Bang - This pioneering couple, Abhay and Rani Bang, highlights their work in rural healthcare: reducing infant and maternal mortality through community-based home-based neonatal car in Gadchiroli. (6) Gladys Staines - After the tragic killing of her missionary husband and sons, she stayed on in India serving leprosy patients, transforming a leper house into the full-fledged Graham Staines Memorial Hospital. (7) Drs Nandakumar & Shylaja Menon - An Indian doctor couple renowned for their extensive an dedicated work in providing healthcare to the indigenous Adivasi community in the Gudalur Valley the Nilgiris district in Tamil Nadu, India. (8) Anant Nevatia - A Prominent Indian philanthropist and an independent non-profit organization management professional, primarily known as the President of the Rural Health Care Foundat (RHCF) (9) Médecins Sans Frontières - An International NGO honoured for its rapid, effective, and neutral crisis-response medical work across conflict zones, disasters, and epidemics around the world.
AWARDEES OF 2016
(1) H.E. Nana Akufo-Addo - He was the President of Ghana. He was awarded the MTMA for sacrificing his political ambitions for the sake of national peace and reconciliation. (2) White Helmets - A volunteer rescue group in war-torn Syria, they risk their lives to pull civilians out of rubble and provide first-aid during airstrikes. They received the MTMA for their "immense resilience bravery operations" and in rescue under extreme conflict. (3) H.H. Abdullah bin Zayed Al Nahyan - The UAE's Minister of Foreign Affairs, was conferred the MTMA for his promotion of justice, diplomacy, and peaceful coexistence (4) Faraaz Hossain - He was posthumously honoured with MTMA for his selfless act of bravery and sacrifice, where he stood for justice till his very last breath against the ISIS Terrorist to save his two Hindu friends. His parents came to receive the awards in his honour, exemplifying deep moral conviction. (5) Selene Biffi - She received the MTMA (national category) for her humanitarian work and inspiring contributions to social justice in India.
(6) Neerja Bhanot- A courageous flight attendant who gave her life to save passengers during a hijack; she was for her and honoured self-sacrifice bravery. (7) Zeenat Shaukat Ali - Known for her staunch commitment to social justice, she was honoured for her efforts in uplifting underprivileged communities and her stand against radicalism. (8) Karambir Singh Kang - He was awarded the MTMA for his dedicated service in social welfare and his commitment to peace, dignity, and justice for the marginalized. He was the one who stood there during the 26/11 attack and saved the guests staying at Taj.
The Assessee further contended that the awards also serve as a platform to bring global attention to people like these, highlighting the initiatives of these unseen heroes, who work silently yet powerfully to uplift humanity. Through their stories, the awards inspire society to embrace empathy, respect, and service as essential values. They keep Mother Teresa's legacy alive not merely as a memory, but as a guiding light for generations. And that is Assessee’s aim and mission: to spread love, understanding, charity and most importantly, service to humanity. The Assessee has mentioned in Form no. 10 the object to work towards all the communities without any discrimination as to religion, caste, creed, gender, education and social justice. And claimed that Harmony Foundation's core focus is on Social Justice. The objective is achieved through providing essential humanitarian aid and conducting awareness campaigns on various social issues that affect the society. The Foundation has partnered, facilitated and engaged with human rights activists and organizations in the rescue of trafficked minors from all over India for the past couple of years. Another important focus area has been to encourage participation and engagement of the youth in the area of social justice through youth consultation and awareness campaigns. A significant initiative has been the Child to Child Connect Initiative which was a humanitarian initiative for refugee support in terms of school essentials, toys and clothes for thousands of refugee children were distributed.
From the aforesaid acts of the Assessee trust, it has become clear that the Assessee trust as claimed, during the AY under consideration carried out its activities in pursuance to or within the parameters of its objects and thus fulfilled the conditions prescribed in the relevant provisions of the Act, as applicable and therefore question posed answered in ‘affirmative’.
It is also an admitted fact that in the previous years, the Assessee has also accumulated the income of the previous years and the Revenue has not doubted the same and continuously allowed the income to be accumulated further, which resulted into accumulation of income to the tune of Rs.16,20,585/-.
Thus, considering the ratio laid down in the judgments referred to above and the aforesaid peculiar facts and circumstances in totality, specific to the effect that the Assessee due to constraint of space in Colum of Form no.10 qua object to be specified, has specified particular object, may be general in nature but the same was in consonance with the major objects of the Assessee Trust and it is not the case of the Revenue Department that the purpose specified, was outside of the scope of the objects of the Assessee trust. Further it is also not the case of the Department that the Assessee has not spent part of the accumulated income for achieving its one of the main objects, as set out in the trust deed and has not worked within the scope of objects of the trust and/or violated any provisions of the trust. it is also not the case of the Department that the Assessee has not followed any other conditions and/or has not met out other parameters as mandated u/s 11(2) of the Act, the Assessee’s claim qua accumulation of income is allowed.
In the result, the appeal filed by the Assessee is allowed. Order pronounced in the open court on 20.11.2025.