Section 17 of the Income Tax Act

The Kerala High Court held that charitable institutions claiming exemption under Section 11 are not entitled to claim depreciation on assets used for charitable purposes, taking a view contrary to most other High Courts.

When considering an application for condonation of delay, the court must examine whether the mistake causing the delay was bona fide or merely a device to cover an ulterior purpose, guiding the exercise of its discretion.

Forfeited advance money received for the transfer of a capital asset is not taxable as revenue receipt. Such forfeiture pertains to a capital receipt directly related to the potential sale of a capital asset.

An assessee is entitled to exemption under Section 54 for long-term capital gains on a new residential house where a flat under construction is treated as 'construction' and not a purchase, allowing the benefit of the three-year completion period.

The Supreme Court holds that a purposive interpretation and harmonious construction must be applied to the provisions of the Income-tax Act. This approach is particularly important when considering claims for exemption from tax, to ensure the interpretation sub-serves the object and purpose of the law.

The definition of 'income' under section 2(24) is inclusive, adding artificial categories without losing its natural connotation. Perquisites under section 17(2) are taxable as 'salary' when paid by an employer on behalf of an employee to discharge an obligation the employee would otherwise bear.

An amount received for relinquishing the right to sue or for settlement of disputes is a capital receipt, not assessable as capital gains. This is because the right to sue is considered a 'capital asset' and its relinquishment does not constitute a 'transfer' under Section 2(47) for the purpose of capital gains.

A party seeking condonation of delay in filing a case must demonstrate a "sufficient cause", meaning an adequate and satisfactory reason that prevented them from approaching the court within the prescribed limitation period. Mere negligence or lack of diligence is not a sufficient cause.

Compensation received for breach of contract and disposal of the subject-matter is a capital receipt and not assessable as capital gains, as it does not involve a transfer of a capital asset.