M/S. MANJEET KAUR MEMORIAL PREMIER INSTITUTE OF EDUCATION,GURGAON vs. ITO, GURGAON

Assessee has filed these Appeals against the separate Orders dated

25.1.2016 and 23.1.2015 passed by the Ld. Commissioner of Income Tax

(Appeals)—2, Gurgaon pertaining to assessment year 2011-12 & 2010-11.

2011-12) read as under:-

passed by learned Commissioner of Income Tax (Appeals)

[CIT(A)] is bad both in the eye of law and on facts.

has erred both on facts and in law in confirming the

addition of Rs. 44,54,602/- made by the learned AO.

has erred both on facts and in law in confirming the action

of A.O. in denying the exemption under section 11 of the

Income Tax Act while computing its income ignoring the

fact that the assessee-society is an educational institution

and registered under section 12AA of the Income Tax Act

and the society was holding the property/assets wholly for

charitable purposes.

has erred both on facts and in law in not appreciating the

provision of Section 11 of the Act whereby exemption is to

be provided to the extent which income of the charitable

trust is applied to charitable or religious purposes in India.

(A) has erred both on facts and in law in not appreciating

the fact that the income U/s 11 (1) refers. to the income

from property held under the trust and which has to be

applied for charitable purposes irrespective of the head of

income under which the income is assessable.

(A) has erred both on facts and in law in ignoring the

various judicial pronouncements in this regard.

confirming the findings of the learned AO ignoring the

explanation and evidences submitted by the assessee in

support of its contention.

of the grounds of appeal.

2010-11) read as under:-

facts of the case.

not carrying education activity in this premises.

97,90,257/- as income from house property and taxed

under the head income from house property.

application / utilization of expenses against the receipt for

the purpose of charitable activity u/s. 2(15) of the Income

Tax Act, 1961.

charged u/s. 234A, 234B, 234C and 234D of the Income

tax Act.

Prayer:-

It is therefore, prayed that the disallowance / additions

sustained as above by Ld. CIT(A) be deleted and appeal be

allowed.

ITA NO. 1824/DEL/2016 (AY 2011-12)

on 01.08.2011 declaring total income of Rs. NIL. The case was selected for

scrutiny under the compulsory clause of Central Action Plan 2012. Notice

under section 143(2) was issued on 26.9.2012. After change of jurisdiction,

the notices under section 143(2) and 142(1) alongwith a questionnaire was

issued on 12.8.2013. In response thereto, assessee’s AR appeared and

filed the reply. AO observed that the society has made an agreement with

M/s Mothers Pride Personal Ltd. to establish a pre-school learning centre/

nursery school. As per the agreement with the assessee and the said

company, premise will be made available free of charges during the

subsistence of the agreement. In consideration of the above assessee is

entitled to 20% of the entire collection which includes registration charges,

admission charges, annual charges, quarterly charges, monthly fees, hobby

classes and charges of all the activities conducted in the school except

transport and refundable security. AO during the assessment proceedings

considered the amount received from Mothers Pride Persona Limited of Rs.

51,55,453/- as Income under the head house property and allowed statutory

deduction under section 24 of Rs. 15,46,359/- of the Income Tax Act.

Further addition of Rs. 12,676/- on account of interest income, Income from

IT Refund Interest of Rs. 37,382/- and miscellaneous income of Rs.

7,95,450/-received as voluntary donations. Total addition of Rs. 44,54,602/-

was made to the returned income of the assessee. Thereafter, the AO

completed the assessment at Rs. 44,54,602/- by making various additions

vide his order dated 29.3.2014 passed u/s. 143(3) of the Income Tax Act, 1961.

appealed before the Ld. CIT(A), who vide his impugned order dated

25.1.2016 has dismissed the appeal of the assessee.

appeal before the Tribunal.

present case the assesse purchased and constructed the property after

taking term loan from the bank and made the agreement with the Mother

Pride Education Persona P Ltd. in respect of rental income. There is no case

of any transfer of funds to the members of the society. He further stated

that the rental income from the property is in the charitable objects of the

Trust as mentioned in the Clause z aa) of the Memorandum of Association.

He relied upon the order of the Chennai Bench in the case of Anjuman-E-

Himayath-E-Islam (2015) 154 ITD 755. He further stated that in respect of

interest expenses of Rs. 24,25,411/- it has been paid on term loan taken to

acquire/ construction of assets of the society. He further stated that

assessee has also made the repayment of loan to the tune of Rs.

29,51,584/- and depreciation of Rs. 32,31,728/- are the application of

income for charitable purposes. He relied upon the order of the Hon’ble

Madras High Court in the case of DIT(E) vs. GovinduNaicker Estate (2009)

315 ITR 237 (Madras). It was the further contention that expenditure 6

incurred on blood donation camps, free books distribution are purely

charitable in nature and therefore, to be considered of application of income.

Administrative expenses are basically includes printing and stationery,

conveyance expenses, office maintenance expenses which are necessary for

running office of the trust. Therefore, he finally stated that this is not the

case of the AO that the assessee has made any business of sale or purchase

of property. There is no allegation that activities are not charitable in nature.

In view of the above, he requested that addition in dispute may be deleted.

Counsel of the assessee and relied upon the orders of the authorities below

and requested that the same may be upheld.

available with me, especially the orders passed by the revenue authorities

and the case laws cited by the Ld. Counsel of the Assessee. In this case the

assessee is a society registered under Societies Registration Act 1860 and

registered under 12AA of the Income Tax Act. Assessee filed the Income tax

return for the A.Y. 2011-12 on 01.08.2011 declaring total income of Rs. Nil

along with copy of Audit Report, Balance sheet and Income & Expenditure

Alc. It has been noticed that during the year under consideration the

assessee had an agreement with M/s Mothers Pride Education Persona

Limited to establish a pre-school learning center nursery school. As per the

agreement with the assessee and the said company, premises will be made

available free of charge during the subsistence of the agreement. In

consideration of the above assessee is entitled to 20% of the entire

collection which includes registration charges, admission charges, annual

charges, quarterly charges, monthly fees, hobby classes and charges of all

the activities conducted in the school except transport and refundable

security. During the assessment proceedings the amount received from

Mothers Pride Persona Limited of Rs. 51,55,453/- as Income under the head

house property and allowed statutory deduction under section 24 of

Rs. 15,46,359/- of the Income Tax Act. Further addition of Rs. 12,676/- on

account of interest income, Income from IT Refund Interest of Rs. 37,382/-

and miscellaneous income of Rs. 7,95,450/- received as voluntary donations.

Total addition of Rs. 44,54,602/- was made to the returned income of the

assessee. Aggrieved by the order of the AO assessee preferred an appeal

before the Ld.CIT(A) who rejected the contention raised by the assessee

that the interest paid by the assessee for raising the loan for construction of

the property, repayment of loan, are application of income and therefore

assessee in total has applied Rs. 69,71,358/- which is far more than the

receipts and confirmed the addition made by the AO. I find that AO has

passed two pages order and has made only one action treating the income

received from the Mothers Pride Education Persona P Ltd as income under

the head house property. However, while computing the total assessed

income added the interest income of Rs. 12676/-, Rs. 37382/- on account of

interest on refund and Rs. 7,95,450/- as miscellaneous income which is the

amount received as voluntary donation without giving any justification for

the same. I further find that AO has accepted the application of funds made

by the assessee and he did not make any adverse comment on the activities

rendered by the assessee. In the present case, assessee purchased and

constructed the property after taking term loan from the bank and made the

agreement with the Mothers Pride Education Persona P Ltd in respect of

rental income. There is no case of any transfer of funds to the members of

the society. Further, rental income from the property is in the charitable

objects of the trust as mentioned in the (clause z aa) of the Memorandum of

Association. For the sake of ready reference the relevant clause of the

Memorandum of Association reads as under:-

“z aa) Without prejudice to the generality of the above objects

and for effectively carrying out the same, the society shall have

power to receive, hold and posses any property including

securities of any kind and to construct and maintained any

building and to enter into any contract for or in connection with

the purpose of the society to raise funds by creating charge

over the assets of the society or otherwise for the benefit of the

society and to accept the management of any trust or

endowment in which the society may be interested.” 9

9.1 My aforesaid view is fully supported by the ITAT, Chennai Bench

decision in the case of Anjuman-E-Himayath-E-lslam[2015] 154 ITO 755

(Chennai - Trib.) While determining 'income' of assessee-trust and its

'application of income' for purpose of claiming exemption under section 11

(1)(a), provisions of Chapter-IV i.e. sections 22 to 27 applicable for

computing income chargeable to tax under head 'income from house

property', will not be attracted. For the sake of convenience, the Relevant

extract of the order is reproduced hereunder:

"6.3 We have heard both the parties and carefully perused the

materials available on record. Chapter-III refers to "income

which does not form part of total income". Section-11 of the Act

placed under Chapter-III deals with 'income from property held

for charitable or religious purpose'. Section- 11 (1 )(a) provides

that income derived from the property held under trust wholly

for charitable or religious purpose, to the extent to which such

income is applied, shall not be included in its total income. The

Act also provides that upto 15% of the gross income received is

accumulated and then the same shall also be exempt from the

income of the trust. From the above it is clear that provision of

the Act in Chapter-III deals with the manner in which the income

of the assessee trust has to be applied in order to exempt such

income from the total income. It is not a case of computation of 10

income chargeable to tax as per the provisions Chapter IV under

the head "C-Income from house property". Therefore while

determining the "income" of the assessee trust and its

"application of income" for the purpose of claiming exemption

u/s. 11(1 )(a) of the Act, the provisions of Chapter-IV - Sections

22 to 27 of the Act which is applicable for computing the income

chargeable to tax under the head 'income from house property'

will not be attracted. However, provisions of sections 22 to 27 of

the Act will come into play when the assessee is not entitled to

the benefit of Section-11(1)(a) of the Act and when such income

of the Trust is chargeable to tax under the head "income from

house property". It is pertinent to mention here that Hon'ble

Calcutta High Court supra has held that income contemplated by

the provisions of section 11 is the real income and not the

income as assessed or assessable. Accordingly, while arriving at

the rental income of the assessee-trust any expenditure incurred

whatsoever related to the rental income has to be allowed as

deduction and the net income which is the real income, will be

treated as the income of the Trust. From our above discussion

the ground raised by the assessee on this issue will not survive

and therefore, the order of the Revenue is upheld. "

9.2 Further a perusal of income & expenditure and CIT(A) order at page

no. 6 shows that application made by the assessee is towards the charitable

activities and as per the objects of the society. The Break up of application

of Rs. 69,71,358 is as under:

i. Administrative Expenses Rs. 3,48,145/-

ii. Interest & Bank charges Rs.24,25,411/-

iii. Depreciation Rs. 32,31,728/-

iv. Maintenance expenses Rs.4,88,307/-

v. Blood Donation camp exp. Rs. 1,83,770/-

vi. Eye Check up camp exp. Rs. 1,54,149/-

vii. Free Books Distribution exp. Rs. 1,39,848/-

Rs. 69.71,358/-

9.3 ln respect of Interest expenses of Rs. 24,25,411/- it has been paid on

term loan taken to acquire/construction of assets of the society. Further,

assessee has also made the repayment of loan to the tune of Rs. 29,51,584

and depreciation of Rs. 32,31,728/- are the application of income for

charitable purposes. In this regard, reliance is placed on the judgement of

the Madras High Court in the case of DIT(E) vs GovinduNaicker Estate[2009]

315 ITR 237 (Madras) wherein it has been held as under:

“9. In the case on hand, it is an admitted fact that the

property of the assessee-trust was in a dilapidated

condition and would not earn income to carry out the

objects of the trust. For the purpose of carrying out the

objects of the trust, it has become necessary to demolish

and reconstruct the property so as to earn income by

exploiting the property. It is also an admitted fact that the

rental income in the property held in trust amounted to 90

per cent, of the total income of the trust. For the purpose

of putting up the construction of the property held in trust,

the trust borrowed fund from the Indian Bank. Thus, the

capital asset so put up by the borrowed fund is only for the

purpose of augmenting income in order to carry out the

object of the trust as envisaged. It is clear from the order

of the Commissioner of Income-tax (Appeals) that neither

the Assessing Officer nor the assessee has adverted to the

object of the charitable trust. But the authorities

proceeded on the premise that the complex has been put

up by the trust in order to perform its charitable activities,

which factum has also not been disputed by the Revenue. 13

The assessee-trust in order to perform its charitable

activities, necessarily has to exploit the capital assets by

finding appropriate avenues for earning revenue and for

that purpose, has to incur expenditure, which is capital in

nature by raising loan. The capital asset built with a

borrowed fund generates income which enabled the

charitable trust to perform its charitable activities. Thus,

the capital asset built with borrowed fund, under no

circumstances, could be regarded to be outside the scope

of its objects. If it is within the objects of the charitable

trust, then there is no reason as to why the borrowing

made for the construction of the building and repayment of

the loan could not be treated as an application of income.

It is not the case of the Assessing Officer that the asses-

See by constructing the commercial complex contravened

the objects of the trust. There is no provision in the Act,

which disentitles the assessee-trust from claiming

repayment of loan as application of income, especially in

view of the fact that the trust has to augment its income

and for that purpose it has put up a construction with

borrowed fund. If raising of loan does not stand in the way

of its charitable activities, the repayment there after must

be treated as application of its income. By repayment of

the loan, the trust wiped its liability and the income earned

from the property would be available for being utilised for

charitable purposes.”

9.4 From the above, I noticed that Expenditure incurred on blood donation

camps, Free books distribution are purely charitable in nature and therefore

these are to be considered application of income. Administrative expenses

are basically includes printing & stationery, conveyance expenses, office

maintenance expenses which are necessary for running office of the trust. In

view of the above, it is not the case of the AO that the assessee has made

any business of sale or purchase of property. There is no allegation that

activities are not charitable in nature.

9.5 In the background of the aforesaid discussions and respectfully

following the precedents, as aforesaid, I delete the addition in dispute and

accordingly decide the issue in dispute in favour of the assessee and against

the Revenue. In the result, the Appeal filed by the Assessee stands allowed.

ITA NO. 2025/DEL/2015 (AY 2010-11)

on 08.10.2010 declaring total income of Rs. NIL. The return of income was

processed u/s. 143(1) of the I.T. Act. The case was picked up for scrutiny.

Accordingly, notice u/s. 143(2) of the I.T. Act was issued on 23.9.2011 and

further statutory notice u/s. 142(1) alongwith questionnaire issued on

15.10.201. In response to the notice, assessee’s AR appeared and filed the

information, details and written submissions. AO observed that the society

has made an agreement with M/s Mothers Pride Personal Ltd. to establish a

pre-school learning centre/ nursery school. As per the agreement with the

assessee and the said company, premise will be made available free of

charges during the subsistence of the agreement. In consideration of the

above assessee is entitled to 20% of the entire collection which includes

registration charges, admission charges, annual charges, quarterly charges,

monthly fees, hobby classes and charges of all the activities conducted in

the school except transport and refundable security. AO during the

assessment proceedings considered the amount received from Mothers Pride

Persona Limited of Rs. 97,90,257/- as Income under the head house

property and allowed statutory deduction (@30%} of Rs. 29,37,077/- and

interest on borrowed capital of Rs. 33,94,280/- under section 24 of the

Income Tax Act. Further addition of Rs. 17,503/- on account of interest

income was also made by him. Total addition of Rs. 34,54,602/- was made

to the returned income of the assessee. Thereafter, the AO completed the

assessment at Rs. 34,76,403/- by denying the exemption u/s. 11 of the Act

claimed by the assessee, by making various additions vide his order dated 04.3.2013 passed u/s. 143(3) of the Income Tax Act, 1961.

appealed before the Ld. CIT(A), who vide his impugned order dated

23.1.2015 has dismissed the appeal of the assessee.

appeal before the Tribunal.

present case the assesse purchased and constructed the property after

taking term loan from the bank and made the agreement with the Mother

Pride Education Persona P Ltd. in respect of rental income. There is no case

of any transfer of funds to the members of the society. He further stated

that the rental income from the property is in the charitable objects of the

Trust as mentioned in the Clause z aa) of the Memorandum of Association.

He relied upon the order of the Hon’ble Jurisdictional High Court in the case

of Director of Income Tax (Exemption) vs. Span Foundation (2009) 17 DTR

283 (Del) and Hon’ble Uttarakhand High Court decision in the case of CIT

vs. Jyoti Prabha Soceity (2009) 310 ITR 162. He further stated that the

source from which the money is received is lease and license fee but its

application is for the purposes of charitable activities covered u/s. 2(15) of

the Act. in respect of interest expenses of Rs. 33,94,280/- it has been paid

on term loan taken to acquire/ construction of assets of the society. He

further stated that assessee has also made the repayment and depreciation 17

of Rs. 33,94,280/- are the application of income for charitable purposes. He

relied upon the order of the Hon’ble Madras High Court in the case of DIT(E)

vs. GovinduNaicker Estate (2009) 315 ITR 237 (Madras). It was the further

contention that expenditure incurred on blood donation camps, free books

distribution and Eye check up Camp are purely charitable in nature and

therefore, to be considered of application of income. Therefore, he finally

stated that this is not the case of the AO that the assessee has made any

business of sale or purchase of property. There is no allegation that activities

are not charitable in nature. In view of the above, he requested that addition

in dispute may be deleted.

Counsel of the assessee and relied upon the orders of the authorities below

and requested that the same may be upheld.

available with me, especially the orders passed by the revenue authorities

and the case laws cited by the Ld. Counsel of the Assessee. During the year

under consideration the assessee had an agreement with M/s Mothers Pride

Education Persona Limited to establish a pre- school learning center/ nursery

school. As per the agreement with the assessee and the said company,

premise will be made available free of charge during the subsistence of the

agreement. In consideration of the above assessee is entitled to 20% of the

entire collection which includes registration charges, admission charges,

annual charges, quarterly charges, monthly fees, hobby classes and charges

of all the activities conducted in the school except transport and refundable

security. AO during the assessment proceedings consider the amount

received from Mothers Pride Persona Limited of Rs. 97,90,257/- as Income

under the head house property and allowed statutory deduction (@30%} of

Rs. 29,37,077/- and interest on borrowed capital of Rs. 33,94,280/- under

section 24 of the Income Tax Act. Further addition of Rs. 17,503/- on

account of interest income was also made by him. Total addition of Rs.

34,54,602/- was made to the returned income of the assessee. The

assessee is not engaged in charitable activities and thus income is

assessable under the head income from house property. The AO has passed

the order and has treated the income received from the Mothers Pride

Education Persona P Ltd as income under the head house property.

However, while computing the total assessed income added the interest

income of Rs. 17,503/- , without giving any justification for the same. In

the present case, assessee purchased and constructed the property after

taking term loan from the bank and made the agreement with the Mothers

Pride Education Persona P Ltd in respect of rental income. There is no case

of any transfer of funds to the members of the society. Further, rental

income from the property is in the charitable objects of the trust as

mentioned in the clause (z aa) of the Memorandum of Association. Further a

perusal of income & expenditure shows that application made by the

assessee is towards the charitable activities and as per the objects of the

society. The issue is squarely covered in favour of assessee by the judgment

of Jurisdictional High Court in the case of DIRECTOR OF INCOME TAX

(EXEMPTION) Versus SPAN FOUNDATION [(2009) 17 DTR 283 (Del), (2009)

178 TAXMAN 436 (Del)] wherein Assessee trust having constructed a

building out of borrowed funds, application of rent derived from the said

building to repay the borrowed funds has to be treated as application of

income for charitable purposes and the assessee is entitled to benefits of ss.

11 and 12. Further Hon'ble Uttarakhand High Court in the case of

COMMISSIONER OF INCOME-TAX Versus JYOTI PRABHA SOCIETY [2009]

310 ITR 162 (Uttarakhand) held as under;

"It is true that the activities of the respondent-society

includes letting out of the properties to the educational

institutions. Had the rental income earned by the

respondent-society not utilized for the educational

purposes it could have been said that the letting out of the

property on the part of the respondent-society has lost the

charitable purpose. But, in the present case, there is a

concurrent finding of fact on the part of the Commissioner

of Income-tax (Appeals) and the Income-tax Appellate

Tribunal that the rental income earned by the respondent-

society is being utilized again for the purposes of imparting

education by maintaining the buildings and constructing

new buildings for the same purpose. As such, we are of the

view that the charitable purpose is not lost and it cannot

be said that the assessee-respondent is not entitled to

exemption claimed by it under section 11 of the Act."

15.1 I find that in the case of assessee although the source from which the

money is received is lease & license fee but its application is for the

purposes of charitable activities covered u/s 2(15). Further, loan advances

by an educational trust to students for higher studies should be treated as

application of income for the charitable purpose. I further note that the

CBDT vide its Circular No. 100 [F.No. 195/1/72-IT(A-I), dated 24.1.1973]

has decided that repayment of the loan originally taken to fulfill one of the

objects of the trust will amount to an application of the income for charitable

purposes. As regards the loan advanced for higher studies. If the only object

of trust is to give interest bearing loans for higher studies, it will amount to

carrying on of money lending business. However, if the object of the trust is

advancement of education and granting of scholarship loans as only one of

the activities carried on for the fulfillment of the objectives of the trust,

granting of loan even interest bearing will amount to application of income 21

for charitable purposes. As and when the loan is returned to trust, it will be

treated as income of that year. I draw support from the decision of the

Hon’ble Karnataka High Court in the case of CIT Vs Janmabhoomi Press

Trust [2000] 242 ITR 703 (Karn.) wherein it has been held that repayment

of loan for the construction of the building by the assessee for the purpose

of augmenting its fund shall qualify as income applied for charitable purpose.

The existing scheme of section 11 as well as section 10(23C) provides

exemption in respect of income when it is applied to acquire a capital asset.

Subsequently, while computing the income for purposes of these sections,

notional deduction by way of depreciation etc. is claimed and such amount of

notional deduction remains to be applied for charitable purpose. Break up of

application of Rs. 79,10,968/- is as under:

I. Administrative Expenses Rs. 3,95,692/-

ii. Interest & Bank Charges Rs. 33,94,2801-

III. Depreciation Rs. 36,55,891/-

IV. Blood Donation camp expenses Rs. 1,93,6701-

v. Eye Check up camp expenses Rs. 1,16,985/-

vi. Free Books Distribution Expenses Rs. 1,54,450/-

Rs. 79,10,968/- 22

15.2 ln respect of Interest expenses of Rs. 33,94,280/- it has been paid on

term loan taken to acquire/construction of assets of the society. Further,

assessee has also made the repayment of loan and depreciation of

Rs. 36,51,891/- are the application of income for charitable purposes. In this

regard, reliance is placed on the judgement of the Madras High Court in the

case of DIT{E) vs Govindu Naicker Estate [2009] 315 ITR 237 (Madras)

wherein it has been held as under:

“9. In the case on hand, it is an admitted fact that the

property of the assessee-trust was in a dilapidated

condition and would not earn income to carry out the

objects of the trust. For the purpose of carrying out the

objects of the trust, it has become necessary to demolish

and reconstruct the property so as to earn income by

exploiting the property. It is also an admitted fact that the

rental income in the property held in trust amounted to 90

per cent, of the total income of the trust. For the purpose

of putting up the construction of the property held in trust,

the trust borrowed fund from the Indian Bank. Thus, the

capital asset so put up by the borrowed fund is only for the

purpose of augmenting income in order to carry out the

object of the trust as envisaged. It is clear from the order

of the Commissioner of Income-tax (Appeals) that neither 23

the Assessing Officer nor the assessee has adverted to the

object of the charitable trust. But the authorities

proceeded on the premise that the complex has been put

up by the trust in order to perform its charitable activities,

which factum has also not been disputed by the Revenue.

The assessee-trust in order to perform its charitable

activities, necessarily has to exploit the capital assets by

finding appropriate avenues for earning revenue and for

that purpose, has to incur expenditure, which is capital in

nature by raising loan. The capital asset built with a

borrowed fund generates income which enabled the

charitable trust to perform its charitable activities. Thus,

the capital asset built with borrowed fund, under no

circumstances, could be regarded to be outside the scope

of its objects. If it is within the objects of the charitable

trust, then there is no reason as to why the borrowing

made for the construction of the building and repayment of

the loan could not be treated as an application of income.

It is not the case of the Assessing Officer that the asses-

See by constructing the commercial complex contravened

the objects of the trust. There is no provision in the Act,

which disentitles the assessee-trust from claiming

repayment of loan as application of income, especially in

view of the fact that the trust has to augment its income

and for that purpose it has put up a construction with

borrowed fund. If raising of loan does not stand in the way

of its charitable activities, the repayment there after must

be treated as application of its income. By repayment of

the loan, the trust wiped its liability and the income'

earned from me property would be available for being

utilised for charitable purposes."

15.3 I further note that Depreciation has been held to be an application of

income in following judgments:

I. CIT Vs Tiny Tots Education Society [2011] 330 ITR 16 (P&H)

II. DIT Vs Vishwa Jagriti Mission [2013] 83 DTR 47 (Del).

III. CIT Vs Sheth Manilal Ranchhoddas Vishram Bhawan Trust [1992] 198 ITR 598 (Guj).

IV. CIT Vs Bharuka Public Welfare Trust [1999] 240 ITR 513 (Cal)

V. CIT Vs Institute of Banking Personnel Selection [2003] 264 ITR 110 (Bom.)

15.4 Further, expenditure incurred on Eye check up, blood donation camps,

Free books distribution are purely charitable in nature and therefore are to

be considered application of income. Administrative expenses are 25

basically includes printing & stationery, conveyance expenses, office

maintenance expenses and salary expenses which are necessary for running

office of the trust. In my view, this is not the case of the AO that the

assessee has made any business of sale or purchase of property. There is no

allegation that activities are not charitable in nature. In the background of

the aforesaid discussions and respectfully following the precedents, as

aforesaid, I delete the addition in dispute and accordingly decide the issue

in dispute in favour of the assessee and against the Revenue. In the result,

the Appeal filed by the Assessee stands allowed.

Order pronounced in the Open Court on 09/01/2017.

Sd/-

[H.S. SIDHU] JUDICIAL MEMBER Date: 09/01/2017 srb