Vidyaniketan Education and Cultural Trust, Bangalore V. Assistant Director of Income tax (Exemption), Bangalore

ITA 1349/BANG/2014

• Counselvise Citation: [2015] 120 COUNSELVISE.COM (IT) 9768 (ITAT-BANGALORE)
• Duration Of Justice: 7 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 16-06-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 03-11-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR SHANKAR PRASAD K JT
• Assessee Lawyers: S RAMASUBRAMANIAN
• Keywords: Capital asset; Depreciation; Charitable institution; Cost of acquisition; Capital expenditure
• Section: 143(3); 32; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI N.V. VASUDEVAN, JUDICIAL MEMBER AND SHRI ABRAHAM P.GEORGE, ACCOUNTANT MEMBER S.P.NO.230/BANG/14 AND ITA NOS.1349/BANG/2014 ASSESSMENT YEARS : 2009-10 VIDYANIKETAN EDUCATION AND CULTURAL TRUST, ULLAL CROSS ROAD, ULLAL UPANAGAR, BANGALORE 560 056. PAN: AAATV 1618F VS. THE ASSISTANT DIRECTOR OF INCOME TAX (EXEMPTIONS), CIRCLE 17(2), BANGALORE. APPELLANT RESPONDENT APPELLANT BY : SHRI S. RAMASUBRAMANIAN, CA RESPONDENT BY : DR. SHANKAR PRASAD, K., JT. CIT(DR) DATE OF HEARING : 16.06.2015 DATE OF PRONOUNCEMENT : 23.06.2015 O R D E R PER N.V. VASUDEVAN, JUDICIAL MEMBER THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORD ER DATED 28.04.2014 OF THE CIT(APPEALS)-V, BANGALORE RELATIN G TO A.Y. 2009-10. 2. THE FIRST ISSUE THAT ARISES FOR CONSIDERATION IN THIS APPEAL IS AS TO WHETHER THE CIT(APPEALS) WAS RIGHT IN DIRECTING THE AO TO ALLOW SP NO. 230/BANG/2014& ITA NO.1349/BANG/2014 PAGE 2 OF 12 DEPRECIATION ON THE CAPITAL ASSETS, DESPITE THE FAC T THAT AT THE TIME WHEN THE CAPITAL ASSETS WERE ACQUIRED, THE SAME WERE TREATED AS APPLICATION OF INCOME IN THOSE YEARS. 3. THE ASSESSEE IS A CHARITABLE TRUST RUNNING EDUCA TIONAL INSTITUTIONS. IN THE COURSE OF ASSESSMENT U/S. 143(3) OF THE ACT FOR AY 2008-09, THE AO NOTICED FROM THE DETAILS OF DEPRECIATION CLAIMED, T HAT THE DEPRECIATION WAS CLAIMED ON ASSETS, THE COST OF ACQUISITION OF THE S AID ASSETS HAD BEEN CLAIMED BY THE ASSESSEE AS CAPITAL EXPENDITURE TOWA RDS APPLICATION OF FUNDS TOWARDS THE OBJECTS OF THE TRUST AND ALLOWED AS SUCH. ACCORDING TO THE AO, ALLOWING SUCH A CLAIM WOULD AMOUNT TO ALLOW ING DOUBLE DEDUCTION. ON THE FACTS OF THE PRESENT CASE, HE WAS OF THE VIE W THAT THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF ESCORTS LIMITED & ANOTHER VS. UNION OF INDIA 199 ITR 43 IS SQUARELY APPLICABLE, WHEREIN IT HAS BEEN CATEGORICALLY HELD THAT WHEN DEDUCTION U/S 35(2)(IV ) IS ALLOWED IN RESPECT OF CAPITAL EXPENDITURE ON SCIENTIFIC RESEARCH, NO DEPR ECIATION IS ALLOWABLE U/S 32 ON THE SAME ASSET. 4. THE ASSESSEE POINTED OUT BEFORE CIT(A) THAT HON' BLE HIGH COURT OF KARNATAKA IN THE CASE OF ALL SAINTS CHURCH, 148 ITR 786 (KAR) AND SOCIETY OF SISTERS OF ST. ANN, 146 ITR 28 (KAR) HAS TAKEN THE VIEW THAT WHERE CAPITAL EXPENDITURE ON ACQUISITION OF DEPRECI ABLE ASSET IS CONSIDERED AS APPLICATION OF INCOME FOR CHARITABLE PURPOSE, AL LOWING DEPRECIATION ON THE VERY SAME CAPITAL ASSET WOULD NOT AMOUNT TO DOU BLE ALLOWANCE. THE SP NO. 230/BANG/2014& ITA NO.1349/BANG/2014 PAGE 3 OF 12 ASSESSEE ALSO POINTED OUT THAT THE DECISION OF ESCORTS LTD. (SUPRA) WILL NOT BE APPLICABLE AS IT WAS RENDERED ON A DIFFERENT SET OF FACTS. 5. THE CIT(A) HOWEVER, HELD THAT ALLOWANCE OF DEPRE CIATION WHEN THE COST HAS ALREADY BEEN RECOVERED BY WAY OF EXEMPTION AS APPLICATION OF INCOME AMOUNTS TO DOUBLE DEDUCTION AND DOUBLE BENEF IT ON THE SAME ASSET. THE CIT(A) REFERRED TO THE DECISION OF THE OF HON'BLE HIGH COURT OF KERALA IN THE CASE OF DDIT(E) V. LISSIE MEDICAL INSTITUTIONS, 348 ITR 344 (KER) WHEREIN IT WAS HELD THAT ALLOWING DEPRECIATION OF A DEPRECIABLE ASSET WHEN THE COST OF ACQUISITION OF DEPRECIABLE A SSET WAS ALLOWED AS APPLICATION OF INCOME FOR CHARITABLE PURPOSE AMOUNT S TO DOUBLE DEPRECIATION AND THEREFORE DEPRECIATION CANNOT BE A LLOWED. THE CIT(A) ALSO OBSERVED THAT THE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN CIT V. SOCIETY OF SISTERS OF ST. ANNS, 146 ITR 28 , WHEREIN IT WAS HELD THAT DEPRECIATION IF NOT ALLOWED AS A NECESSARY DEDUCTIO N FOR COMPUTING THE INCOME FROM CHARITABLE INSTITUTIONS THEN THERE IS N O WAY TO PRESERVE THE CORPUS OF THE TRUST FOR DERIVING INCOME, DID NOT TA KE COGNIZANCE OF THE PROVISIONS OF SEC.11(2) OF THE ACT WHICH PERMITS UP TO 15% OF THE INCOME (BEFORE DEPRECIATION) BEING AVAILABLE FOR ACCUMULA TE OR APPROPRIATE TOWARDS CORPUS/EARMARKED FUND, WITHOUT ANY CONDITIO N OF APPLICATION WITHIN STIPULATED PERIOD OF 6 YEARS (THEN 10 YEARS). ACC ORDING TO CIT(A), THIS PART OF INCOME COULD BE ACCUMULATED OVER AN INDEFINITE P ERIOD FOR REPLACING OR ADDING ANY CAPITAL ASSET, WHICH WOULD DEPRECIATE AN D/OR OUTLIVE UTILITY OR SP NO. 230/BANG/2014& ITA NO.1349/BANG/2014 PAGE 4 OF 12 BECOME OBSOLETE. ACCORDING TO CIT(A), IN ANY CASE, NOTHING PROHIBITS THE TRUSTEES TO APPLY THE INCOME OF ANY YEAR FOR ACQUIR ING A CAPITAL ASSET TO SUBSTITUTE A DEPRECIATED ASSET. AGGRIEVED BY THE ORDER OF CIT(APPEALS), THE ASSESSEE HAS PREFERRED THE PRESENT APPEAL BEFOR E THE TRIBUNAL. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS. WE HAVE HE ARD THE SUBMISSIONS OF THE LD. DR, WHO RELIED ON THE ORDER OF AO. HE ALSO PLACED RELIANCE ON THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF DIT(E) VS. CHARANJIV CHARITABLE TRUST (2014) TAXMAN N.COM 300 (DELHI) WHEREIN IT WAS HELD THAT ALLOWING DEPRECIATION ON A SSETS, THE COST OF ACQUISITION OF WHICH WAS ALREADY CONSIDERED AS APPL ICATION OF INCOME IS NOT PERMISSIBLE. 7. WE HAVE CONSIDERED THE ORDER OF THE AO. IDENTIC AL ISSUE CAME UP FOR CONSIDERATION BEFORE ITAT BANGALORE BENCH IN TH E CASE OF DDIT(E) V. CUTCHI MEMON UNION (2013) 60 SOT 260 BANGALORE ITAT , WHEREIN SIMILAR ISSUE HAS BEEN DEALT WITH BY THIS TRIBUNAL. IN THE AFORESAID CASE, THE ASSESSEE CLAIMED DEPRECIATION AND THE AO DENIED DEPRECIATION ON THE GROUND THAT AT THE TIME OF ACQUIRING THE RELEVANT C APITAL ASSET, COST OF ACQUISITION WAS CONSIDERED AS APPLICATION OF INCOME IN THE YEAR OF ITS ACQUISITION. THE AO TOOK THE VIEW THAT ALLOWING DE PRECIATION WOULD AMOUNT TO ALLOWING DOUBLE DEDUCTION AND PLACED RELIANCE ON THE DECISION OF HON'BLE SUPREME COURT IN ESCORTS LTD. (SUPRA) . THE CIT(A), HOWEVER, ALLOWED THE SP NO. 230/BANG/2014& ITA NO.1349/BANG/2014 PAGE 5 OF 12 CLAIM OF ASSESSEE. ON FURTHER APPEAL BY THE REVENU E, THE TRIBUNAL HELD AS FOLLOWS:- 20. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. IF DEPRECIATION IS NOT ALLOWED AS A NECESSARY DEDUCTION FOR COMPUTI NG INCOME OF CHARITABLE INSTITUTIONS, THEN THERE IS NO WAY TO PR ESERVE THE CORPUS OF THE TRUST FOR DERIVING THE INCOME AS IT IS NOTHI NG BUT A DECREASE IN THE VALUE OF PROPERTY THROUGH WEAR, DETERIORATIO N, OR OBSOLESCENCE. SINCE INCOME FOR THE PURPOSES OF SECT ION 11(1) HAS TO BE COMPUTED IN NORMAL COMMERCIAL MANNER, THE AMO UNT OF DEPRECIATION DEBITED IN THE BOOKS IS DEDUCTIBLE WHI LE COMPUTING SUCH INCOME. IT WAS SO HELD BY THE HONBLE KARNATA KA HIGH COURT IN THE CASE OF CIT VS. SOCIETY OF SISTERS OF ST. ANNE 146 ITR 28 (KAR). IT WAS HELD IN CIT VS. TINY TOTS E DUCATION SOCIETY (2011) 330 ITR 21 (P&H) , FOLLOWING CIT VS. MARKET COMMITTEE, PIPLI (2011) 330 ITR 16 (P&H) : (2011) 238 CTR (P&H) 103 THAT DEPRECIATION CAN BE CLAIMED BY A CHA RITABLE INSTITUTION IN DETERMINING PERCENTAGE OF FUNDS APPL IED FOR THE PURPOSE OF CHARITABLE OBJECTS. CLAIM FOR DEPRECIATI ON WILL NOT AMOUNT TO DOUBLE BENEFIT. THE DECISION OF THE HON BLE SUPREME COURT IN THE CASE OF ESCORTS LTD. 199 ITR 43 (SC) H AVE BEEN REFERRED TO AND DISTINGUISHED BY THE HONBLE COURT IN THE AFORESAID DECISIONS. 21. THE ISSUE RAISED BY THE REVENUE IN THE GROUND OF APPEAL IS THUS NO LONGER RES INTEGRA AND HAS BEEN DECIDED BY THE HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT V. M ARKET COMMITTEE, PIPLI, 330 ITR 16 (P&H). THE HONBLE P UNJAB & HARYANA HIGH COURT AFTER CONSIDERING SEVERAL DECISI ONS ON THAT ISSUE AND ALSO THE DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF ESCORTS LTD. (SUPRA), CAME TO THE CONCLUSIO N THAT DEPRECIATION IS ALLOWABLE ON CAPITAL ASSETS ON THE INCOME OF THE CHARITABLE TRUST FOR DETERMINING THE QUANTUM OF FUN DS WHICH HAVE TO BE APPLIED FOR THE PURPOSE OF TRUSTS IN TERMS OF SECTION 11 OF THE ACT. THE HONBLE PUNJAB & HARYANA HIGH COURT MADE A REFERENCE TO THE DECISION OF THE HONBLE SUPREME CO URT IN THE CASE OF ESCORTS LTD. (SUPRA) AND OBSERVED THAT THE HONBLE SUPREME COURT WAS DEALING WITH A CASE OF TWO DEDUCT IONS UNDER DIFFERENT PROVISIONS OF THE ACT, ONE U/S. 32 FOR DE PRECIATION AND THE OTHER ON ACCOUNT OF EXPENDITURE OF A CAPITAL NA TURE INCURRED ON SCIENTIFIC RESEARCH U/S. 35(1)(IV) OF THE ACT. THE HONBLE SP NO. 230/BANG/2014& ITA NO.1349/BANG/2014 PAGE 6 OF 12 COURT THEREAFTER HELD THAT A TRUST CLAIMING DEPRECI ATION CANNOT BE EQUATED WITH A CLAIM FOR DOUBLE DEDUCTION. THE HON BLE PUNJAB & HARYANA HIGH COURT HAS ALSO MADE A REFERENCE TO T HE DECISION OF THE HON'BLE KARNATAKA HIGH COURT IN THE CASE OF CIT V. SOCIETY OF SISTERS OF ANNE, 146 ITR 28 (KAR), WHERE IN IT WAS HELD THAT U/S. 11(1) OF THE ACT, INCOME HAS TO BE COMPUT ED IN NORMAL COMMERCIAL MANNER AND THE AMOUNT OF DEPRECIATION DE BITED IN THE BOOKS IS DEDUCTIBLE WHILE COMPUTING SUCH INCOME. I N VIEW OF THE AFORESAID DECISION ON THE ISSUE, WE ARE OF THE VIEW THAT THE ORDER OF THE CIT(A) ON THE ABOVE ISSUE DOES NOT CALL FOR ANY INTERFERENCE. 22. CONSEQUENTLY, GROUND NO.5 RAISED BY THE REVENU E IS DISMISSED. 9. THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CHARANJIV CHARITABLE TRUST (SUPRA) IS CONTRARY TO THE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF SOCIETY OF SISTERS OF ANNE (SUPRA) . WE ARE BOUND TO FOLLOW THE VIEW OF THE HONBLE KARNATA KA HIGH COURT WHICH IS THE JURISDICTIONAL HIGH COURT AS FAR AS THE BANGALO RE BENCH OF ITAT IS CONCERNED. WE THEREFORE PREFER TO FOLLOW THE DECIS ION OF THE HONBLE KARNATAKA HIGH COURT. WE MAY ALSO ADD THAT THE LEG AL POSITION HAS SINCE BEEN AMENDED BY A PROSPECTIVE AMENDMENT BY THE FINA NCE (NO.2) ACT, 2014 W.E.F. 1.4.2015 BY INSERTION OF SUB-SECTION (6 ) TO SECTION 11 OF THE ACT, WHICH READS AS UNDER:- (6) IN THIS SECTION WHERE ANY INCOME IS REQUIRED TO BE APPLIED OR ACCUMULATED OR SET APART FOR APPLICATION, THEN, FOR SUCH PURPOSES THE INCOME SHALL BE DETERMINED WITHOUT ANY DEDUCTION OR ALLOWANCE BY WAY OF DEPRECIATION OR OTHERWISE IN RESPECT OF ANY ASSET, ACQUISITION OF WHICH HAS BEEN CLAIMED AS AN APPLICATION OF INCOME UNDER THIS SECTION IN THE SAME OR ANY OTH ER PREVIOUS YEAR. SP NO. 230/BANG/2014& ITA NO.1349/BANG/2014 PAGE 7 OF 12 10. AS ALREADY STATED, THE AFORESAID AMENDMENT IS PROSPECTIVE AND WILL APPLY ONLY FROM A.Y. 2015-16. IN VIEW OF THE ABOVE LEGAL POSITION, WE ARE OF THE VIEW THAT THE ORDER OF THE CIT(A) IS NOT JUST A ND PROPER. THE CLAIM OF THE ASSESSEE FOR DEDUCTION ON ACCOUNT IS THEREFORE DIRECTED TO BE ALLOWED. CONSEQUENTLY THE FIRST ISSUE IS DECIDED IN FAVOUR O F THE ASSESSEE. 11. THE NEXT ISSUE RAISED BY THE ASSESSEE IN ITS GR OUNDS OF APPEAL IS WITH REGARD TO DISALLOWANCE OF ACCUMULATION OF INCO ME U/S 11(2) OF THE ACT. 12. DURING THE YEAR THE ASSESSEE HAD ACCOUNTED AN AMOUNT OF RS.75,00,000 AS ACCUMULATION U/S 11(2) OF THE IT AC T. THE PURPOSE OF THE ACCUMULATION WAS SUBMITTED AS UNDER:- TO IMPROVE/DEVELOP THE BUILDINGS OF THE TRUST AN D CONDUCT EDUCATIONAL/CHARITABLE ACTIVITIES 13. ACCORDING TO THE AO, THE PURPOSE APPEARED TO B E NOT FOR ANY DETERMINABLE PURPOSE OR PURPOSES BUT IN GENERAL FOR EDUCATIONAL AND CHARITABLE ACTIVITIES IN A BLANKET MANNER. SUCH AC CUMULATION ACCORDING TO THE AO WAS NOT PERMISSIBLE U/S.11(2) OF THE ACT. T HE ASSESSEE SUBMITTED BEFORE AO THAT THE PURPOSE GIVEN FOR THE PURPOSE OF ACCUMULATION WAS SPECIFIC AND THE CLAIM FOR ACCUMULATION SHOULD BE A LLOWED. ACCORDING TO THE AO, THE PURPOSE OF ACCUMULATION AS GIVEN ABOVE WAS VERY GENERAL IN NATURE. HENCE THE AO DISALLOWED THE CLAIM OF THE A SSESSEE FOR SP NO. 230/BANG/2014& ITA NO.1349/BANG/2014 PAGE 8 OF 12 ACCUMULATION OF INCOME CLAIMED BY THE ASSESSEE U/S 11(2) OF THE IT ACT FOR AN AMOUNT OF RS. 75,00,000 AND BROUGHT THE SAME TO TAX. 14. ON APPEAL BY THE ASSESSEE, THE CIT(APPEALS) UPH ELD THE ORDER OF THE AO BY FOLLOWING THE DECISION OF THE HONBLE MAD RAS HIGH COURT IN THE CASE OF M.C. MUTHIAH CHETTIAR TRUST 245 ITR 400 (MAD) WHEREIN FOLLOWING THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF DIT VS. SINGHANIA CHARITABLE TRUST 199 ITR 819 (CAL) , IT WAS HELD THAT THE PURPOSE OF ACCUMULATION HAS TO BE MENTIONED SPECIFICALLY OT HERWISE THE ACCUMULATION CLAIMED CAN BE DISALLOWED. 15. AGGRIEVED BY THE ORDER OF THE CIT(A) THE ASSES SEE HAS PREFERRED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 16. WE HAVE HEARD THE RIVAL SUBMISSIONS. THE LEARN ED DR RELIED ON THE ORDER OF THE CIT(A) AND THE REASONS GIVEN BY HIM. THE LEARNED COUNSEL FOR THE ASSESSEE RELIED ON DECISION OF THE HONBLE DELH I HIGH COURT IN THE CASE OF DIT (E) VS. DAULAT RAM EDUCATION SOCIETY 278 ITR 260 (D ELHI) . THE HONBLE DELHI HIGH COURT IN THE SAID CASE HAS HELD THAT THAT PURPOSE MENTIONED IN FORM 10 FOR ACCUMULATION OF INCOME NEE D NOT BE SPECIFIC AND THAT ACCUMULATION OF INCOME UNDER SECTION 11(2) CAN NOT BE DENIED EVEN IF PURPOSE/OBJECTS MENTIONED IN FORM 10 ARE GENERAL. 17. WE HAVE GIVEN A VERY CAREFUL CONSIDERATION TO T HE RIVAL SUBMISSIONS. THERE APPEARS TO BE DIVERGENT VIEWS ON THE ISSUE. THE VIEW EXPRESSED BY SP NO. 230/BANG/2014& ITA NO.1349/BANG/2014 PAGE 9 OF 12 THE HONBLE MADRAS HIGH COURT HONBLE MADRAS HIGH C OURT IN THE CASE OF M.C.MUTHIAH CHETTIAR TRUST 245 ITR 400 (MAD) FOLLOWING THE DECISION OF THE HONBLE CALCUTTA HIGH COURT IN THE CASE OF DIT VS. SINGHANIA CHARITABLE TRUST 199 ITR 819 (CAL) SUPPORTS THE VIEW TAKEN BY THE REVENUE AUTHORITIES. THE DECISION OF THE HONBLE DELHI HIG H COURT IN THE CASE OF DIT(E) VS. DAULAT RAM EDUCATION SOCIETY 278 ITR 260 (DELHI) SUPPORTS THE STAND TAKEN BY THE ASSESSEE. THE VIEW FAVOURABLE T O THE ASSESSEE, IN THE ABSENCE OF DECISION OF HONBLE JURISDICTIONAL HIGH COURT, HAS TO BE FOLLOWED. WE ALSO FIND THAT SIMILAR ISSUE RAISED BY THE ASSES SEE IN THIS APPEAL WAS ALSO CONSIDERED BY THIS TRIBUNAL IN THE CASE OF DDIT(E) V. GOKULA EDUCATION FOUNDATION, ITA NO.1091/BANG/2014 AND THI S TRIBUNAL BY ORDER DATED 30.12.2014 HELD AS FOLLOWS:- 7. AS FOR THE SECOND ISSUE, IT IS NECESSARY TO RE PRODUCE SECTION 11(2) OF THE ACT AND RULE 17 WHICH ARE ON A CCUMULATION; WHERE (EIGHTY FIVE) PERCENT OF THE INCOME REFERR ED TO IN CLAUSE(A) OR CLAUSE(B) OF SUB-SECTION (1) REA D WITH THE EXPLANATION TO THAT SUB-SECTION IS NOT APP LIED, OR IS NOT DEEMED TO HAVE BEEN APPLIED, TO CHARITABL E OR RELIGIOUS PURPOSES IN INDIA DURING THE PREVIOUS YEA R BUT IS ACCUMULATED OR SET APART, EITHER IN WHOLE OR IN PART, FOR APPLICATION TO SUCH PURPOSES IN INDIA, SU CH INCOME SO ACCUMULATED OR SET APART SHALL NOT BE INCLUDED IN THE TOTAL INCOME OF THE PREVIOUS YEAR O F THE PERSON IN RECEIPT OF THE INCOME, PROVIDED THE FOLLO WING CONDITIONS ARE COMPLIED WITH, NAMELY A) SUCH PERSON SPECIFIES, BY NOTICE IN WRITING GIV EN TO THE AO IN THE PRESCRIBED MANNER, THE PURPOSE FOR WHICH THE INCOME IS BEING ACCUMULATED OR SET APART AND THE PERIOD FOR WHICH THE INCOME IS TO BE SP NO. 230/BANG/2014& ITA NO.1349/BANG/2014 PAGE 10 OF 12 ACCUMULATED OR SET APART, WHICH SHALL IN NO CASE EXCEED TEN YEARS. B) THE MONEY SO ACCUMULATED OR SET APART IS INVEST ED OR DEPOSITED IN THE FORMS OR MODES SPECIFIED IN SU B- SECTION(5). PROVIDED THAT IN COMPUTING THE PERIOD OF TEN YEARS REFERRED TO IN CLAUSE (A), THE PERIOD DURING WHICH THE INCOME COULD NOT BE APPLIED FOR THE PURPOSE FOR WHI CH IT IS SO ACCUMULATED OR SET APART, DUE TO AN ORDER OR INJUNCTION OF ANY COURT, SHALL BE EXCLUDED; PROVIDED FURTHER THAT IN RESPECT OF ANY INCOME ACCUMULATED OR SET APART ON OR AFTER THE 1 ST DAY OF APRIL,2001, THE PROVISIONS OF THIS SUB-SECTION SHAL L HAVE EFFECT AS IF FOR THE WORDS TEN YEARS AT BOTH THE PLACES WHERE THEY OCCUR, THE WORDS FIVE YEARS HAD BEEN SUBSTITUTED. RULE 17 .. THE NOTICE TO BE GIVEN TO THE AO OR THE PRESCRIBED AUTHORITY UNDER SUB-SECTION(2) OF SECTIO N 11 OR UNDER THE SAID PROVISION AS APPLICABLE UNDER CLAUSE(2) OR CLAUSE(23) OF SECTION 10SHALL B IN FOR M NO.10 AND SHALL BE DELIVERED BEFORE THE EXPIRY O F THE TIME ALLOWED UNDER SUB-SECTION (1) OF SECTION 139, FOR FURNISHING THE RETURN OF INCOME. THE REQUIREMENT IN THE ACT ARE (I) SPECIFICATION BY NOTICE IN WRITING TO THE AO(II) SUCH SPECIFICATION SHOULD BE IN PRESCRIBED MANNER AND (III) AND SUCH SPECIFICATION SHOULD GIVE THE PURPOSE OF ACCUMULATION. THE TIME LIMIT HAS BEEN MENTIONED IN THE RULES ALONE. THE DELEGATED POWER OF RULE MAKING GIVEN IN SECTION 11(2) IS ONLY FOR PRESCRIBING THE MANNER OF FILING THE APPLICATION. THE POWER DOES NOT INCLUDE FIXATION OF TIME LIMITS. DELEGATED LEGISLATIVE POWERS ARE CIRCUMSCRIBED BY THE STATUTE DELEGATING SUCH POWERS AND TRANSGRESSION THEREOF CAN RENDER TH E RULES BEYOND THE SCOPE OF SUCH DELEGATION. HENCE, WE C ANNOT FAULT THE LEARNED CIT(A) TAKING COGNIZANCE OF THE REVISED FORM NO.10A FILED BY THE ASSESSEE. IN ANY CASE, AS OBSE RVED BY LEARNED CIT(A), HONBLE DELHI HIGH COURT IN THE CAS E OF BHARATH KALYAN PRATISTHAN AS WELL AS BHARAT KRISHAK SAMAJ(S UPRA) HAD HELD THAT DETAILS OF PURPOSE OF ACCUMULATION WAS N OT A SP NO. 230/BANG/2014& ITA NO.1349/BANG/2014 PAGE 11 OF 12 REQUIREMENT THAT CAN BE READ INTO SECTION 11(2). REVENUE HAS NOT BEEN ABLE TO BRING BEFORE US ANY DECISION OF HO NBLE JURISDICTIONAL HIGH COURT ON THIS ISSUE, AND THEREF ORE, ASSESSEE HAS TO BE GIVEN THE BENEFIT OF THE DECISION IN ITS FAVOUR, IN PREFERENCE TO THE DECISIONS GOING AGAINST IT. 18. THE DECISIONS OF THE HONBLE DELHI HIGH COURT REFERRED TO IN THE DECISION OF THE TRIBUNAL QUOTED ABOVE ARE IDENTICAL TO THE RULING OF THE HONBLE DELHI HIGH COURT IN THE CASE OF DAULAT RAM EDUCATION SOCIETY (SUPRA) . IN VIEW OF THE AFORESAID DECISIONS, WE DO FIND M ERITS IN THE GROUND RAISED BY THE ASSESSEE ON THE SECOND ISSUE AND ALLO W THE RELEVANT GROUNDS. 19. IN VIEW OF THE DISPOSAL OF THE APPEAL OF THE A SSESSEE, THE STAY PETITION FILED BY THE ASSESSEE DOES NOT REQUIRE ANY CONSIDERATION AND THE SAME IS THEREFORE DISMISSED. 20. IN THE RESULT, THE APPEAL BY THE ASSESSEE IS AL LOWED, WHILE THE STAY PETITION BY THE ASSESSEE IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON THIS 23 RD DAY OF JUNE , 2015 . SD/- SD/- (ABRAHAM P. GEORGE) ( N.V. VASUDEV AN ) ACCOUNTANT MEMBER JUDICIAL MEM BER BANGALORE, DATED, THE 23 RD JUNE, 2015 . /D S/ SP NO. 230/BANG/2014& ITA NO.1349/BANG/2014 PAGE 12 OF 12 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR/ SENIOR PRIVATE SECRETARY ITAT, BANGALORE.