Section 13(3) of the Income Tax Act

Income-tax Act, 2025: ss.332–355

Section 13(3) falls under section 13 of the Income-tax Act, 1961, which corresponds to sections 332 to 355 of the Income-tax Act, 2025, the provisions on registered non-profit organisations.

Read the 2025 provisions

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 13(3) is CIT v. Society of the Sisters of St. Anne (146 ITR 28), cited in 195 of the 563 judgments on BharatTax that turn on this section.

Leading authorities on Section 13(3)

CIT v. Society of the Sisters of St. Anne
146 ITR 28 · 1984 · High Court
195
citing judgments

Depreciation claimed by a charitable trust on its assets is an allowable application of income for computing exemption under Section 11, and this does not constitute a double deduction.

Director of Income-tax (Exemption) v. Framjee Cawasjee Institute
109 CTR 463 · 1993 · High Court
191
citing judgments

A charitable trust is allowed to claim depreciation on its assets for computing its income, even if the capital expenditure incurred on acquiring those assets was treated as an application of income in the year of acquisition.

CIT v. Synopsis International Old Ltd.
212 Taxmann 454 · 2013 · High Court
177
citing judgments

Payments for computer software are treated as royalty income under Section 9(1)(vi) of the Income-tax Act, particularly concerning the expanded definition provided by Explanation 2 and Explanation 4.

CIT v. Wipro Ltd.
203 Taxmann 621 · 2011 · High Court
140
citing judgments
1. Father Mullers Charitable Institutions 363 IT 230 (Kar.) 2. DIT(E) v. Sheth Mafatlal Gagalbhai Foundation Trust
249 ITR 533 · 2001 · High Court
108
citing judgments

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.

CIT v. Andhra Pradesh State Road Transport Corporation
159 ITR 1 · 1986 · Supreme Court
102
citing judgments

An organization qualifies as charitable under Section 2(15) only if its income and property are solely applied for its charitable objects and, upon dissolution, its residual assets are restricted for utilization exclusively for charitable purposes, not for distribution to members or as general state revenue.

AGARWAL WAREHOUSING AND LEASING LTD. v. CIT
257 ITR 235 · 2002 · High Court
102
citing judgments

Orders passed by the Income Tax Appellate Tribunal are binding on all revenue authorities, including the Assessing Officer and Commissioner (Appeals), functioning under its jurisdiction. Judicial discipline requires subordinate authorities to follow these orders unreservedly, and failure to do so constitutes judicial impropriety and an error in law.

CIT v. Sheth Manilal Ranchhoddas Vishram Bhavan Trust
198 ITR 598 · 1992 · High Court
98
citing judgments

When computing the income of a charitable trust for exemption under Section 11, depreciation must be allowed as an application of income based on commercial principles. This does not constitute a double deduction.

CIT v. Ahmedabad Rana Caste Association
140 ITR 1 · 1983 · Supreme Court
82
citing judgments

An object beneficial to a section of the public, as distinguished from an individual or group of individuals, qualifies as an object of general public utility under Section 2(15) and hence a charitable purpose. This applies even if the benefits are restricted to a specific caste, community, or professional group.

CIT v. Raipur Pallottine Society
180 ITR 579 · 1989 · High Court
79
citing judgments

Depreciation is deductible when computing the income of a charitable trust under Section 11, and treating both depreciation and capital expenditure as an application of income for charitable purposes does not amount to a double deduction.

Judgments on Section 13(3)

M/S Heritage Educational Society, Chandigarh vs. DCIT, C-1, (E), Chandigarh

ITA 1071/CHANDI/2019[2015-16]Status: DisposedITAT Chandigarh26 Nov 2020AY 2015-16
For Appellant: Shri Sudhir Sehgal, AdvocateFor Respondent: Shri Arvind Sudarshan, JCIT (Sr. DR)
Section 11(1)Section 12ASection 13Section 13(1)Section 13(1)(c)Section 13(3)Section 131Section 142(1)Section 143(3)Section 147

M/S Heritage Educational Society, Chandigarh vs. DCIT, C-1, (E), Chandigarh

ITA 1070/CHANDI/2019[2014-15]Status: DisposedITAT Chandigarh26 Nov 2020AY 2014-15
For Appellant: Shri Sudhir Sehgal, AdvocateFor Respondent: Shri Arvind Sudarshan, JCIT (Sr. DR)
Section 11(1)Section 12ASection 13Section 13(1)Section 13(1)(c)Section 13(3)Section 131Section 142(1)Section 143(3)Section 147

M/S Heritage Educational Society, Chandigarh vs. DCIT, C-1, (E), Chandigarh

ITA 1069/CHANDI/2019[2010-11]Status: DisposedITAT Chandigarh26 Nov 2020AY 2010-11
For Appellant: Shri Sudhir Sehgal, AdvocateFor Respondent: Shri Arvind Sudarshan, JCIT (Sr. DR)
Section 11(1)Section 12ASection 13Section 13(1)Section 13(1)(c)Section 13(3)Section 131Section 142(1)Section 143(3)Section 147

Joint Commissioner of Income Tax (OSD) (Exemptions), Circle- 1, Bangalore vs. M/S. Sri Srinivasa Education and Charitable, Bangalore

In the result, the appeal filed by the revenue is dismissed

ITA 421/BANG/2020[2013-14]Status: DisposedITAT Bangalore11 Nov 2020AY 2013-14

Bench: Shri N.V. Vasudevan & Shri Chandra Poojariassessment Year: 2013-14

For Appellant: Ms. Neera Malhotra, D.RFor Respondent: Shri Prashanth G.S., A.R
Section 11Section 13(1)(c)Section 132Section 132(4)Section 143(3)Section 153ASection 271A

M/S Shaheed Kartar Singh Sarabha Charitable Trust (Regd.), Ludhiana vs. DCIT, (E), C-1, Chandigarh

Appeal is allowed

ITA 174/CHANDI/2019[2015-16]Status: DisposedITAT Chandigarh10 Nov 2020AY 2015-16

Bench: Shri N.K. Saini & Shri Satbeer Singh Godara

For Appellant: Shri Ashwani Kumar, Shri AdityaFor Respondent: Smt. Geetinder Maan (Addl.CIT)
Section 11Section 11(1)Section 12ASection 13Section 13(3)Section 143(3)Section 250(6)Section 80G

M/S Pinegrove International Charitable Trust, Chandigarh vs. DCIT, C-1 (E), Chandigarh

In the result, the appeal of the assessee is accordingly allowed

ITA 567/CHANDI/2019[2015-16]Status: DisposedITAT Chandigarh31 Aug 2020AY 2015-16

Bench: Shri Sanjay Garg & Smt.Annapurna Guptaआयकर अपील सं./ Ita No.567/Chd/2019 "नधा"रण वष" / Assessment Year : 2015-16

For Appellant: Shri A.K. Sood, FCAFor Respondent: Shri Daya Inder Singh
Section 11Section 12ASection 13(1)(c)Section 13(3)Section 143(3)Section 250(6)

National Payments Corporation of India, Mumbai vs. DCIT (E) 2(1), Mumbai

ITA 3382/MUM/2016[2012-13]Status: DisposedITAT Mumbai06 Jul 2020AY 2012-13

Bench: Hon’Ble Shri Mahavir Singh, Vp & Hon’Ble Shri Manoj Kumar Aggarwal, Am

For Appellant: S/Shri Soli E.Dastur (Ld. Sr. Counsel)For Respondent: Shri Rahul Raman-CIT- DR
Section 11Section 11(2)Section 12Section 13Section 13(3)Section 2(15)Section 25

National Payments Corporation of India, Mumbai vs. DCIT (E) 2(1), Mumbai

ITA 5431/MUM/2015[2010-11]Status: DisposedITAT Mumbai06 Jul 2020AY 2010-11

Bench: Hon’Ble Shri Mahavir Singh, Vp & Hon’Ble Shri Manoj Kumar Aggarwal, Am

For Appellant: S/Shri Soli E.Dastur (Ld. Sr. Counsel)For Respondent: Shri Rahul Raman-CIT- DR
Section 11Section 11(2)Section 12Section 13Section 13(3)Section 2(15)Section 25

Deputy Commissioner of Income Tax(Exemptions), Vijayawada vs. Cargo Handling Private Workers Pool Trust, Visakhapatnam

In the result, appeals filed by the Revenue in ITA Nos

ITA 314/VIZ/2018[2012-2013]Status: DisposedITAT Visakhapatnam08 Jun 2020AY 2012-2013

Bench: Shri V. Durga Rao, Hon’Ble & Shri D.S. Sunder Singh, Hon’Ble

For Appellant: Dr. C.P. Rama Swami, AdvFor Respondent: Shri S.R.S. Narayan, CIT DR
Section 13(1)(c)Section 143(3)Section 164(2)

Deputy Commissioner of Income Tax(Exemptions), Vijayawada vs. Cargo Handling Private Workers Pool Trust, Visakhapatnam

In the result, appeals filed by the Revenue in ITA Nos

ITA 313/VIZ/2018[2011-2012]Status: DisposedITAT Visakhapatnam08 Jun 2020AY 2011-2012

Bench: Shri V. Durga Rao, Hon’Ble & Shri D.S. Sunder Singh, Hon’Ble

For Appellant: Dr. C.P. Rama Swami, AdvFor Respondent: Shri S.R.S. Narayan, CIT DR
Section 13(1)(c)Section 143(3)Section 164(2)

Deputy Commissioner of Income Tax(Exemptions), Vijayawada vs. Cargo Handling Private Workers Pool Trust, Visakhapatnam

In the result, appeals filed by the Revenue in ITA Nos

ITA 312/VIZ/2018[2008-2009]Status: DisposedITAT Visakhapatnam08 Jun 2020AY 2008-2009

Bench: Shri V. Durga Rao, Hon’Ble & Shri D.S. Sunder Singh, Hon’Ble

For Appellant: Dr. C.P. Rama Swami, AdvFor Respondent: Shri S.R.S. Narayan, CIT DR
Section 13(1)(c)Section 143(3)Section 164(2)

Hamdard Nation Foundation (India), New Delhi vs. ACIT (E), New Delhi

In the result, the appeal of the assessee is allowed

ITA 1641/DEL/2019[2013-14]Status: DisposedITAT Delhi03 Jun 2020AY 2013-14

Bench: Ms. Sushma Chowladr. B. R. R. Kumar(E-Court Module) Ita No. 1641/Del/2019 : Asstt. Year : 2013-14 Hamdard National Foundation Vs Acit(E), (India), Hamdard Building, 2A/3, New Delhi-110002 Asaf Ali Road, New Delhi-110002 (Appellant) (Respondent) Pan No. Aaath0843G Assessee By : Sh. R. M. Mehta, Sr. Adv. Revenue By : Sh. Anupam Kant Garg, Cit Dr Date Of Hearing: 28.05.2020 Date Of Pronouncement: 03.06.2020

For Appellant: Sh. R. M. Mehta, Sr. AdvFor Respondent: Sh. Anupam Kant Garg, CIT DR
Section 10Section 11Section 13(2)Section 13(2)(b)Section 13(3)Section 13(3)(b)

M/S Multi Commodity Exchange Investor Protection Fund, Mumbai vs. ITO(E)-2(1), Mumbai

In the result, the appeal of the assessee is hereby ordered to be allowed for statistical purposes

ITA 861/MUM/2020[2014-15]Status: DisposedITAT Mumbai19 Mar 2020AY 2014-15

Bench: Shri Amarjit Singh, Jm & Shri Manoj Kumar Aggarwal, Am आयकर अपील सं/ I.T.A. No.861/Mum/2020 (ननधधारण वर्ा / Assessment Years: 2014-15) बनधम/ M/S. Multi Commodity Ito (E)-2(1) 5Th Floor, Piramal Exchange Investor Vs. Protection Fund Chambers Lalbaug Parel, Exchange Square, Cts Mumbai-400012. No.225 Suren Road Chakala Andheri (E), Mukhed-400093. स्थधयी लेखध सं./जीआइआर सं./Pan/Gir No. : Aadtm1169M (प्रत्यथी / Respondent) (अपीलाथी /Appellant) .. Assessee By: Shri Girish Dave/Tanzil R. Padvekar Revenue By: Ms. Jotilakshmi Nayak (Dr) सुनवाई की तारीख / Date Of Hearing: 12/02/2020 घोषणा की तारीख /Date Of Pronouncement: 19/03/2020 आदेश / O R D E R Per Amarjit Singh, Jm: The Assessee Has Filed The Present Appeal Against The Order Dated 04.11.2019 Passed By The Commissioner Of Income Tax (Appeals)-6, Mumbai [Hereinafter Referred To As The “Cit(A)”] Relevant To The A.Y.2014- 15. 2. The Assessee Has Raised The Following Grounds Of Appeal: - “1) The Learned Commissioner Of Income Tax (Appeals) ("Ld. Cit(A)") Erred In Passing The Order U/S. 250 Of The Income Tax Act, 1961 Without Giving An Opportunity Of Being Heard To Your Appellant Thereby Violating The Principles Of Natural Justice. Looking To The Facts & Circumstances Of Appellant'S Case & In Law, It Is Submitted That Vide Letter Dated 09/10/2019 Your Appellant Had Requested The Ld. Cit(A) For A Short Adjournment As The Concerned Authorized Person Was Out Of India. Without Prejudice To The Above:

For Appellant: Shri Girish Dave/Tanzil RFor Respondent: Ms. Jotilakshmi Nayak (DR)
Section 11Section 12ASection 13(3)Section 2(15)Section 250

Silver Point Education Trust, Kolkata vs. I.T.O.(Exemption), Ward-1(3), Kolkata

In the result, this appeal of the assessee is allowed

ITA 1735/KOL/2019[2014-15]Status: DisposedITAT Kolkata13 Mar 2020AY 2014-15

Bench: Shri J. Sudhakar Reddy]

Section 11Section 12ASection 13(1)(c)Section 13(3)Section 250

Shiv Educational Society, Panipat vs. DCIT, Panipat

In the result, the appeal of the assessee is allowed for statistical purposes

ITA 371/DEL/2017[2011-12]Status: DisposedITAT Delhi28 Feb 2020AY 2011-12

Bench: Shri Amit Shukla & Shri O.P. Kant

Section 10Section 11Section 12ASection 13Section 13(3)Section 143(2)Section 36

Vansda Taluka Kelavani Mandal, Na

In the result, appeal of the assessee is allowed for statistical purpose

ITA 586/SRT/2019[2019-20]Status: DisposedITAT Surat14 Feb 2020AY 2019-20

Bench: Shri Sandeep Gosain, Hon'Ble & Shri O.P.Meena, Hon'Bleआ.अ.सं./I.T.A No.586/Srt/2019 "नधा"रण वष"/Assessment Year: 2019-20 Vansda Taluka Kelavani Mandal, V The Commissioner Of Shri Pratap High School C Vansda, S Income Tax Navsari – 396 580. . (Exemption), [Pan: Aaatv 7853 N] Ahmedabad. अपीलाथ" / Appellant ""यथ"/Respondent "नधा"रतीक"ओरसे /Assessee By Shri Rasesh Shah – Ca राज"वक"ओरसे /Revenue By Shri Sreenivas T. Bidari – Cit-Dr

Section 10Section 12ASection 13(3)Section 80G(5)

Shree Manni Lal Shikshan Samiti, Allahabad vs. ACIT, Allahabad

In the result, the M.A. is allowed and for statistical purposes, the appeal is treated as allowed

ITA 224/ALLD/2015[2010-11]Status: DisposedITAT Allahabad12 Feb 2020AY 2010-11

Bench: Shri. A. D. Jain & Shri T. S. Kapoorm.A. No.19/Alld/2018 [In Ita No.224/Alld/2015] Assessment Year: 2010-11 Shree Manni Lal Shikshan Samiti V. Acit 121, Daud Nagar, Naini Range Ii Allahabad Allahabad Tan/Pan:Aacas7824B (Applicant) (Respondent) Assessment Year: 2010-11 Shree Manni Lal Shikshan Samiti V. Acit 121, Daud Nagar, Naini Range Ii Allahabad Allahabad Tan/Pan:Aacas7824B (Appellant) (Respondent)

For Appellant: Shri Ashish Bansal, AdvocateFor Respondent: Shri S. K. Madhuk, CIT (DR)
Section 11Section 13(3)

Sri Kharpattu Chauhan Shikshan Sansthan, Azamgarh vs. Commissioner of Income Tax (Exemption), Lucknow

In the result, for statistical purposes, the appeal is treated as allowed

ITA 378/LKW/2019[NA]Status: DisposedITAT Lucknow06 Feb 2020

Bench: Shri. A. D. Jain & Shri T. S. Kapoorassessment Year: N.A. Sri Kharpattu Chauhan V. Cit (Exemption) Shikshan Sansthan Lucknow Vill Hafizpur Post Hafizpur Vikas Khand Palhani District Azamgarh Tan/Pan:Aaqts3789Q (Appellant) (Respondent) Appellant By: Shri P. K. Kapoor, C.A. Respondent By: Shri S. K. Madhuk, Cit (Dr) Date Of Hearing: 05 02 2020 Date Of Pronouncement: 06 02 2020 O R D E R

For Appellant: Shri P. K. Kapoor, C.AFor Respondent: Shri S. K. Madhuk, CIT (DR)
Section 12ASection 13(1)(c)Section 13(3)

Kohinoor Education Trust, Mumbai vs. Asst CIT (E) 1(1), Mumbai

In the result, the appeal is partly allowed

ITA 1359/MUM/2017[2013-14]Status: DisposedITAT Mumbai27 Dec 2019AY 2013-14

Bench: Shri Ravish Sood () & Shri N.K. Pradhan () Assessment Year: 2013-14 Kohinoor Education Trust, The Assistant Commissioner Of Kohinoor Corporate Office, Vs. Income Tax (E)-1(1), Senapati Bapat Marg, Dadar (W), Mumbai. Mumbai-400 028. Pan No. Aabtk2616D Appellant Respondent Assessee By : Shri Jayesh Dadia, Ar Revenue By : Shri K. Bhoopathi, Dr Date Of Hearing : 13/11/2019 Date Of Pronouncement : 27/12/2019 Order Per N.K. Pradhan, Am This Is An Appeal Filed By The Assessee. The Relevant Assessment Year Is 2013-14. The Appeal Is Directed Against The Order Passed By The Commissioner Of Income Tax(Appeals)-1, Mumbai [In Short ‘Cit(A)’] & Arises Out Of The Assessment Completed U/S 143(3) Of The Income Tax Act 1961, (The ‘Act’). 2. The 1St Ground Of Appeal The Ld Cit(A| Has Erred In Law & On The Facts Of The Case In Confirming The Action Of The Assessing Officer In Denying Exemption Under Section 11 & 12 Of The Income Tax Act. The Action Is Unjustified & Unwarranted.

For Appellant: Shri Jayesh Dadia, ARFor Respondent: Shri K. Bhoopathi, DR
Section 1Section 11Section 12ASection 13Section 13(2)(e)Section 13(3)Section 143(3)

The ACIT(Exemptions), Vijayawada vs. The Diocese of Guntur Society, Guntur

Appeal of the revenue is dismissed

ITA 390/VIZ/2016[2007-2008]Status: DisposedITAT Visakhapatnam18 Dec 2019AY 2007-2008

Bench: Shri V. Durga Rao& Shri D.S. Sunder Singh

Section 148