DEPUTY COMMISSIONER OF INCOME TAX(EXEMPTIONS) CIRCLE-2, CHANDIGARH, CHANDIGARH vs. SHRI SHIV NARAIN SIDHESWAR MANDIR BAGH SANATAN DHARAM SABHA, GURGAON

Facts

The Revenue appealed against the CIT(A)'s order for assessment year 2018-19, where the CIT(A) deleted a disallowance related to exemption under Section 11(2) of the Income Tax Act. The assessee claimed accumulation of income, but the AO found Form No. 10 to be non-specific regarding the purpose.

Held

The Tribunal held that the CIT(A) decided the issue in the right perspective. The assessee had indicated that the accumulated funds were for future utilization in hospital projects and modernization. Even if the specific purpose was not perfectly articulated in Form 10, it was to be construed as for charitable activities, and any lapse was not sufficient to deny the exemption.

Key Issues

Whether the non-specific declaration of purpose in Form No. 10 can lead to denial of exemption under Section 11(2) of the Income Tax Act.