“Section 164(2)”
The decision most relied on for Section 164(2) is CIT v. K. Srinivasan (83 ITR 346), cited in 129 judgments on BharatTax.
Leading authorities on Section 164(2)
The term 'tax' includes surcharge and cess. Surcharge and additional surcharge are considered components of income tax, which can be levied as a basic charge, surcharge, special surcharge, and additional surcharge.
For a charitable trust, a violation of Section 13(1)(d) does not lead to the denial of exemption under Section 11 on its total income. Instead, only income derived from investments or deposits made in violation of Section 11(5) or income diverted under Section 13(1)(c) or 13(1)(d) is taxable.
Income of a trust that is taxable at the maximum marginal rate should be taxed accordingly, while other income is eligible for exemption under Section 11 of the Income-tax Act.
Violation of investment mandates under Section 13(1)(d) of the Income Tax Act, 1961, for a charitable trust results in the complete denial of exemption under Section 11 of the Act.
Payments for strategic counselling and advisory services are not royalty if they do not involve imparting information concerning industrial, commercial, or scientific experience, but rather are for business promotion, marketing, publicity, or financial advisory services.
Income earned from investments or deposits made in violation of Section 13(1)(d) of the Income Tax Act is taxable, but only to the extent of the income so earned, not the entire corpus. Circular No. 387, dated 06.07.1994, supports this interpretation and binds the revenue authorities.
When an exemption is denied under Section 13(1)(c) or (d), the denial of exemption applies only to the portion of income that violates these provisions, not the entire income.
An appellate tribunal ought to remand a matter rather than set aside assessments entirely when jurisdiction is in question.
