Section 11(4A) of the Income Tax Act

The decision most relied on for Section 11(4A) is Asstt. CIT v. Thanthi Trust (247 ITR 785), cited in 98 of the 75 judgments on BharatTax that turn on this section.

Leading authorities on Section 11(4A)

Asstt. CIT v. Thanthi Trust
247 ITR 785 · 2001 · Supreme Court
98
citing judgments

A charitable trust can earn income from business activities under Section 11(4A), including incidental businesses, and still claim exemption under Section 11, provided the income is applied towards its charitable objects. Generating a surplus from such activities does not automatically negate the charitable purpose.

CIT v. Programme for Community Organisation
248 ITR 1 · 2001 · Supreme Court
90
citing judgments

The 15% exemption available to charitable trusts under Section 11(1)(a) is absolute and is not curtailed by the provisions of Section 11(2) regarding accumulation of income. Voluntary contributions received towards the corpus of a trust are excluded from the scope of income for Section 11(1)(a) exemption purposes.

Yuvraj v. Union of India
315 ITR 84 · 2009 · High Court
81
citing judgments

Reassessment under Section 148 is valid and does not constitute a mere change of opinion if the original assessment order demonstrates no application of mind to a specific issue, such as the assessability of capital gains or casual income. In such cases, the Assessing Officer is justified in issuing a notice under Section 148 to address the unexamined income escapement.

Institute of Chartered Accountants of India (ICAI) v. DGIT (Exemptions)
358 ITR 91 · 2013 · High Court
80
citing judgments

An institution carrying out charitable objects, such as education or advancement of general public utility, does not lose its Section 11 exemption merely by collecting fees for activities like campus placements or educational guidance, as this does not constitute carrying on a business.

CIT v. Programme for Community Organisation
228 ITR 620 · 1997 · High Court
73
citing judgments

For charitable or religious trusts, income for exemption under Sections 11 and 12 must be computed on a commercial basis, not head-wise as per Section 14, treating expenditure as a charge against income. The net income, along with non-corpus donations, forms the eligible base for determining the application of funds and the permissible accumulation under Section 11(1)(a).

New Noble Educational Society v. CIT
143 Taxmann.com 276 · 2022 · Supreme Court
52
citing judgments

The Supreme Court clarifies the legal position regarding the conditions for educational institutions to claim income tax exemption under the Income-tax Act, 1961. This ruling specifically concerns the definition of 'charitable purpose' and how the institution's activities impact its eligibility for exemption.

(1938) 6 ITR 1, 7 (Ail); Bharat Development (P.) Ltd. v. CIT
133 ITR 470 · 1982 · High Court
41
citing judgments

For an activity to be considered 'business' under income tax law, it must occupy time, attention, and labour with a normal object of making profit. Profit motive is an important factor, and the activity should involve a continuous course of dealings between two or more persons.

Bai Sonabai Hirji Agiary Trust v. ITO
93 ITD 70 · 2005 · ITAT
39
citing judgments

For the purpose of accumulation of income under section 11(1)(a), the calculation is to be made on the gross receipts of the trust before deducting any expenses. This interpretation is based on the plain language of section 11(1)(a) and is supported by Supreme Court decisions.

Multi Screen Media P. Ltd. v. Union of India and Another
324 ITR 54 · 2010 · High Court
39
citing judgments

An assessment for an earlier year can be reopened based on a finding of fact made from fresh material discovered during the assessment for a subsequent year. This is permissible even if the earlier assessment involved a full and true disclosure.

Jalandhar Development Authority v. CIT
124 TTJ 598 · 2010 · ITAT
34
citing judgments

An entity's claim for charitable status is assessed based on its specific activities and the application of its income, not solely on its classification as a development authority. Decisions involving similar authorities are often distinguished based on factual differences, particularly concerning the commercial nature of operations.

Judgments on Section 11(4A)

D.A.V. EDUCATIONAL TRUST,CHENNAI vs. ITO, EXEMPTION WARD-2, CHENNAI

In the result, the appeal of the assessee for AY 2017-18 is allowed

ITA 1670/CHNY/2024[2018-19]Status: DisposedITAT Chennai21 Jan 2026AY 2018-19

Bench: Shri S.S. Viswanethra Ravi & Shri Jagadishआयकर अपील सं./I.T.A. Nos.1667, 1668, 1669 & 1670/Chny/2024 िनधा"रण वष"/Assessment Years: 2014-15, 2015-16, 2017-18 & 2018-19 D.A.V. Educational Trust, Vs. The Income Tax Officer, 5, S V Illam, Mohanapuri Lake View Exemption Ward 4, Street, Adambakkam, Chennai. Chennai 600 088. [Pan: Aaatc5967A] (अपीलाथ"/Appellant) (""थ"/Respondent) अपीलाथ" की ओर से / Appellant By : Shri G. Baskar, Advocate & Shri A. Satyaseelan, Advocate ""थ" की ओर से/Respondent By : Ms. Gouthami Manivasagam, Jcit सुनवाई की तारीख/ Date Of Hearing : 28.10.2025 घोषणा की तारीख /Date Of Pronouncement : 21.01.2026 आदेश /O R D E R Per S.S. Viswanethra Ravi: These Four Appeals Filed By The Assessee Are Directed Against The Orders All Dated 05.04.2024 Passed By The Ld. Commissioner Of Income Tax (Appeals), National Faceless Appeal Centre [Nfac], Delhi For The Assessment Years 2014-15, 2015-16, 2017-18 & 2018-19. 2. Since, The Issues Raised In These Appeals Are Similar Based On The Same Identical Facts, With The Consent Of Both The Parties, We Proceed To 2

For Appellant: Shri G. Baskar, Advocate &For Respondent: Ms. Gouthami Manivasagam, JCIT
Section 11Section 142(1)Section 143(2)Section 143(3)Section 147Section 148Section 2(15)

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