Section 160 of the Income Tax Act

Funds received by an entity acting as a nodal agency or agent of the government for implementing specific government schemes, or income generated from such funds (like lease premiums or interest), are not taxable in the hands of the agency if held on behalf of or remitted to the government.

Where the shares of beneficiaries in a trust are determinate, trustees must be assessed separately for each beneficiary's share, treating each beneficiary as an individual. The income is then taxed at the marginal rate applicable to individuals, not at the maximum rate for an association of persons.

Revenue authorities are not justified in assessing business income in the hands of an entity engaged in construction and development of residential and commercial structures entirely on behalf of the State, as such income constitutes income of the State and is not exigible to income tax. This principle was affirmed by the jurisdictional High Court, affirming the Tribunal's decision.

Beneficiaries of a trust do not set up the trust, and trustees derive authority from the trust deed, meaning neither trustees nor beneficiaries form an association for a common purpose solely due to their existence.

An Assessing Officer can rectify a mistake apparent from the record under Section 154 if the assessee is erroneously taxed at individual rates when it should have been taxed as an AOP.