M/s H.P, State Environment Protection & Pollution Contrl Board, Shimla V. ACIT, Shimla

ITA 814/CHANDI/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 90239 (ITAT-CHANDIGARH)
• Duration Of Justice: 9 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 10-07-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 26-09-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR AMA RVEER SINGH
• Keywords: Charitable institution
• Section: 12AA; 148; 10; 11; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH,CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NO. 814 & 815/CHD/2014 A.Y. : 2007-08 & 2008-09 H.P. STATE ENVIRONMENT PROTECTION VS THE ACIT, & POLLUTION CONTROL BOARD, CIRCLE, PHASE 3, NEW SHIMLA. SHIMLA. PAN: AAALH0191B (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI AJAY JAIN RESPONDENT BY : DR. AMARVEER SINGH,CIT-DR DATE OF HEARING : 10.07.2015 DATE OF PRONOUNCEMENT : 15.07.2015 O R D E R PER BHAVNESH SAINI,JM THIS ORDER SHALL DISPOSE OF BOTH THE APPEALS FILED BY THE ASSESSEE AGAINST ORDERS OF LD. CIT(A) SHIMLA DA TED 23.07.2014. 2. WE HAVE HEARD LD. REPRESENTATIVES OF BOTH THE PA RTIES AND PERUSED THE FINDINGS OF AUTHORITIES BELOW. BOT H APPEALS ARE DECIDED AS UNDER. ITA 814/CHD/2014 (A.Y. 2007-08) 3. THE ASSESSEE IN THIS APPEAL CHALLENGED THE ORDER OF LD. CIT(APPEALS) IN DENYING BENEFIT OF 15% ACCUMULATION AMOUNTED TO RS. 2,61,86,197/-. 4. BRIEFLY THE FACTS OF THE CASE ARE THAT THE ASSES SMENT UNDER SECTION 143(3)/147 OF THE ACT WAS MADE AT INC OME OF 2 RS. 14,43,57,780/- TREATING THE ENTIRE SURPLUS OF R ECEIPTS OVER EXPENDITURE DENYING THE BENEFIT OF 15% ACCUMUL ATION OF RS.2,61,86,197/- UNDER SECTION 11(1) OF THE ACT AS CLAIMED BY THE ASSESSEE AND BENEFIT OF 85% ACCUMULATION OF RS. 11,81,70,581/- UNDER SECTION 11(2) OF THE ACT AS CL AIMED BY ASSESSEE CONSIDERING THAT REQUISITE NOTICE IN STATU TORY FORM NO. 10 IN TERMS OF SECTION 11(2) OF THE ACT WAS BEL ATEDLY FILED. THE LD. COMMISSIONER OF INCOME TAX, SHIMLA DID NOT CONDONE THE DELAY IN FILING FORM NO.10. THE WRIT P ETITION OF THE ASSESSEE WAS DISMISSED BY HIMACHAL PRADESH HIGH COURT. IT IS STATED THAT ASSESSEE BOARD WAS CONSTI TUTED BY THE STATE GOVERNMENT UNDER THE WATER (PREVENTION & CONTROL OF POLLUTION) ACT, 1974 WITH THE MAIN OBJECT OF PER FORMING THE DELEGATED POWER AND FUNCTION TO PROVIDE FOR THE PREVENTION AND CONTROL OF WATER POLLUTION AND MAINT AINING OR RESTORING THE WHOLESOMENESS OF WATER. THE ASSES SEE HAS BEEN GRANTED REGISTRATION UNDER SECTION 12AA OF THE ACT WHICH WAS LATER ON WITHDRAWN. THE WITHDRAWAL ORDER WAS CHALLENGED BEFORE ITAT AND APPEAL OF ASSESSEE WAS A LLOWED. IT IS FURTHER STATED THAT APPEAL OF THE DEPARTMENT IS PENDING BEFORE HIMACHAL PRADESH HIGH COURT. THE ASSESSING OFFICER REOPENED THE ASSESSMENT UNDER SECTION 148 OF THE AC T. THE ASSESSEE HAD DECLARED GROSS INCOME OF RS.17,45,74,6 46/- OUT OF WHICH AN AMOUNT OF RS. 3,02,17,868/- WAS CLA IMED AS APPLIED TO THE CHARITABLE OR RELIGIOUS PURPOSES IN INDIA DURING THE PREVIOUS YEAR AND THE BALANCE AMOUNT OF RS. 11,81,70,581/- WAS SET APART FOR FUTURE UTILIZATION IN TERMS OF SECTION 11(2)(II) AND RS. 2,61,86,197/- WAS SHOW N AS 3 INCOME ACCUMULATED OR SET APART UPTO TO 15%. THE ASSESSING OFFICER FOUND THE ENTIRE SUM AS EXCESS OF INCOME OVER EXPENDITURE AND MADE THE ADDITION OF RS. 14.43 CR TO THE INCOME OF THE ASSESSEE. 5. THE ASSESSEE CHALLENGED THE ADDITION BEFORE LD. CIT(APPEALS) AND IT WAS SUBMITTED THAT ASSESSEE HAS BEEN GRANTED REGISTRATION UNDER SECTION 12AA OF THE ACT AND THAT BENEFIT OF 15% OF ACCUMULATION OF RS. 2.61 CR. UNDE R SECTION 11(1) SHOULD HAVE BEEN GRANTED TO THE ASSESSEE AS P ER LAW. OTHER FACTS ARE NOT RELEVANT IN THE PRESENT APPEAL. THEREFORE, THE SAME ARE NOT DISCUSSED. 6. THE LD. CIT(APPEALS), CONSIDERING THE SUBMISSION S OF THE ASSESSEE FOUND THAT ASSESSEE IS REGISTERED UNDE R SECTION 12AA OF THE ACT AND IS THEREFORE, ENTITLED FOR EXE MPTION AS PER LAW. HOWEVER, AS REGARDS THE ADDITION OF RS.2. 61CR CLAIMING BENEFIT OF 15% ACCUMULATION UNDER SECTION 11(1), LD. CIT(APPEALS) DISMISSED APPEAL OF THE ASSESSEE B ECAUSE THE FORM NO. 10 WAS NOT FILED WITHIN TIME. THE FIN DINGS OF LD. CIT(APPEALS) IN PARA 5.3 TO 5.6 OF THE APPELLAT E ORDER ARE REPRODUCED AS UNDER : ASSESSEE HAS CLAIMED THE BENEFIT OF 15% ACCUMULATION U/S 11(1) (A&B) AND 85% ACCUMULATION U/S 11(2). AS PER SE CTION 11 REVEALS THAT (A) INCOME DERIVED FROM PROPERTY HELD UNDER TRUST WHOLLY FOR CHAR/TABLE OR RELIGIOUS PURPOSES, TO THE EXTENT TO WHICH SUCH INCOME IS APPLIED TO SUCH PURPOSES IN INDIA AND WHERE ANY SUCH INCOME IS ACCUMULATED OR SET APART F OR APPLICATION TO SUCH PURPOSES IN INDIA, TO THE EXTENT TO WHICH THE INCOME SO ACCUMULATED OR SET APART IS NOT IN EX CESS OF [FIFTEEN] PERCENT OF THE INCOME FROM SUCH PROPERTY, (B) INCOME DERIVED FROM PROPERTY HELD UNDER TRUST IN PART ONLY FOR SUCH PURPOSES, THE TRUST HAVING BEEN CREATED BEFORE THE COMMENCEMENT OF THIS ACT, TO THE EXTENT TO WHICH SU CH INCOME IS APPLIED TO SUCH APPLICATION TO SUCH PURPOSES IN INDI A, TO THE 4 EXTENT TO WHICH THE INCOME SO SET APART IS NOT IN E XCESS OF [FIFTEEN] PER CENT OF THE INCOME FROM-SUCH PROPERTY . 5.4 CAREFUL READING OF SECTION 11 SUGGESTED THAT ON LY THAT PART OF INCOME WHICH IS DERIVED FROM THE PROPERTY H ELD UNDER TRUST FOR CHARITABLE OR RELIGIOUS PURPOSES WOULD BE E XEMPT WHICH IS APPLIED FOR SUCH PURPOSE AND WHERE SUCH INC OME IS ACCUMULATED OR SET APART, NOT IN EXCESS OF 15% OF IN COME FROM SUCH PROPERTY. SECTION 11(2) ELABORATES FURTHER THAT WHERE 85% OF THE INCOME UNDER CLAUSE 11(1) ( A) & (B) IS NOT APPLIED BUT IS ACCUMULATED THE EXEMPTION SHALL BE AVAILABLE ONLY O N FULFILLMENT OF CONDITIONS THAT FORM NO. 10 IS DULY SUBMITTED AND THE MONEY IS ACCUMULATED OR DEPOSITED IN THE SPECIFIED MANNER. 5.5 HENCE PRIMARY CONDITION FOR CLAIMING EXEMPTION EVEN FOR ACCUMULATION OF 15% OF INCOME IS THAT 85% OF THE REC EIPTS SHOULD BE EXPENDED ON THE STATED CHARITABLE OR RELIGI OUS PURPOSES OR SHOULD HAVE SUBMITTED FORM 10 AND INVES TED IN THE SPECIFIED MANNER. 5.6. IN THE PRESENT CASE ASSESSEE HAS A TOTAL RECEIP T OF RS.17,45,74,646/- OUT OF WHICH ASSESSEE HAS UTILIZED OR APPLIED ONLY RS.3,02,17,868/- THUS ASSESSEE HAS NOT BEEN ABLE TO SPENT 85% OF THE RECEIPT AND DID NOT HAVE RE QUISITE VALID FORM 10 FOR THE YEAR UNDER CONSIDERATION. HENC E NO BENEFIT U/S 11 CAN BE PROVIDED TO THE ASSESSEE. KEEP ING IN VIEW THE FACTS STATED IN ASSESSMENT ORDER AND ABOVE OBSERVATIONS THE ACTION OF A.O. IS CONFIRMED I.E. A SSESSEE'S CLAIM OF ALLOWING IT THE BENEFIT UNDER SECTION 11(1 ) OF 15% IS NOT ALLOWABLE AND 85% OF ACCUMULATION/S 11(2) IS NOT ALLO WED. 7. THE LD. COUNSEL FOR THE ASSESSEE, AT THE OUTSET SUBMITTED THAT THE ISSUE IS COVERED IN FAVOUR OF TH E ASSESSEE BY ORDER OF ITAT CHANDIGARH BENCH IN THE CASE OF IT O VS BHARTIYA VIDYA MANDIR TRUST, LUDHIANA IN ITA NO. 1093/2013 AND CO NO. 2/2014 FOR ASSESSMENT YEAR 201 0-11 VIDE ORDER DATED 30.04.2015 AND ASSESSEE WOULD BE E NTITLED FOR STATUTORY BENEFIT OF 15% ACCUMULATION UNDER SEC TION 11(1)(A) OF THE ACT AMOUNTING TO RS. 2.61 CRORES. 8. ON THE OTHER HAND, LD. DR RELIED UPON ORDERS OF THE AUTHORITIES BELOW. 5 9. ON CONSIDERATION OF THE FACTS OF THE CASE, IN TH E LIGHT OF ORDER OF ITAT CHANDIGARH BENCH IN THE CASE OF BHART IYA VIDYA MANDIR TRUST (SUPRA), WE FIND THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE ABOVE ORDE R IN WHICH THE TRIBUNAL IN PARA 13 TO 15 HELD AS UNDER : 13. IN THE DEPARTMENTAL APPEAL, THE REVENUE CHALLENGED THE ORDER OF THE LEARNED CIT (APPEALS) I N ALLOWING CREDIT FOR 15% OF THE GROSS RECEIPTS IN WO RKING THE SHORT FALL OF THE AMOUNTS SPENT WHEN THE ASSESS EE HAD NOT FULFILLED THE REQUIREMENTS BY GIVING A NOTI CE UNDER SECTION 11(2)(A) OF THE INCOME TAX ACT FOR ACCUMULATION OF INCOME INTENDED TO BE APPLIED FOR CHARITABLE PURPOSES IN FUTURE YEARS. 14. THE ASSESSEE CHALLENGED THE ORDER OF THE ASSESS ING OFFICER BEFORE THE LEARNED CIT (APPEALS) AGAINST TH E DENIAL OF CREDIT FOR 15% OF THE GROSS RECEIPTS I.E. AN AMOUNT OF RS.1,47,80,028/-. THE FACTS ARE SAME AS NOTED ABOVE WHILE DISPOSING OF THE CROSS OBJECTION OF THE ASSESSEE. IT WAS SUBMITTED THAT AS PER THE PROVISIONS OF SECTION 11 OF THE ACT, IF A CHARITAB LE TRUST INCURRED 85% OF ITS INCOME FOR THE OBJECTIVES OF TH E TRUST, THE BALANCE 15% IS FREE TO BE SET APART/ACCUMULATED WITHOUT ANY CONDITIONS AND NOTHIN G IS TAXABLE. THE ASSESSEE EXPLAINED THAT AS PER S ECTION 11 OF THE ACT, A CHARITABLE INSTITUTION IS NOT CHAR GED TO TAX TO THE EXTENT OF 15% OF ITS INCOME AND RELIED U PON THE DECISION OF THE HON'BLE APEX COURT IN THE CASE OF ADDL.CIT VS. A.L.N. RAO CHARITABLE TRUST, 216 ITR 6 97. IT WAS SUBMITTED THAT FROM THE ABOVE JUDGMENT, IT I S CLEAR THAT AN AMOUNT UPTO 15% OF THE INCOME IS EXEM PT FROM INCOME TAX AND CAN BE ACCUMULATED. THE ASSESSING OFFICER REITERATED THE FACTS STATED IN TH E ASSESSMENT ORDER. THE LEARNED CIT (APPEALS) FOLLO WING THE PROVISIONS OF SECTION 11 OF THE ACT AND THE JUD GMENT OF THE HON'BLE SUPREME COURT IN THE CASE OF A.L.N . RAO CHARITABLE TRUST (SUPRA) DIRECTED THAT THE ASSESSEE IS ELIGIBLE FOR EXEMPTION OF 15% OF THE GROSS RECEIPTS AND ALLOWED THIS GROUND OF APPEAL OF THE ASSESSEE. T HE FINDING OF THE LEARNED CIT (APPEALS) IN PARAS 5.5 T O 5.12 OF THE IMPUGNED ORDER ARE REPRODUCED AS UNDER : 5.5 I HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSI ONS. IT IS SEEN FROM THE ASSESSMENT ORDER THAT THE APPELLANT V IDE HIS SUBMISSIONS DATED 28.12.2012 HAD CLAIMED THAT THERE IS A BLANKET EXEMPTION OF 15% OF THE TOTAL INCOME FROM THE UNSPENT AMOUNT OF THE TRUST. IN THIS REGARD, THE APPELLANT HAD RELIED UPON THE DECISION OF THE HON'BLE SUPREME COURT IN T HE CASE OF 6 A.L.N. RAO CHARITABLE TRUST REPORTED IN 216 ITR 697. THE AO DID NOT DISCUSS THIS ISSUE IN THE ASSESSMENT ORDER WHIL E REJECTING THE APPELLANT'S CLAIM. DURING THE COURSE OF APPELLATE PROC EEDINGS, THE APPELLANT ONCE AGAIN REFERRED TO THE PROVISION OF S ECTION 11 OF THE INCOME TAX ACT AND REITERATED HIS RELIANCE ON THE C ASE OF A.L.N. RAO CHARITABLE TRUST(SUPRA). THE APPELLANT ONCE AGAI N CLAIMED THAT THERE IS BLANKET EXEMPTION OF 15% OF TOTAL INCO ME FROM THE UNSPENT AMOUNT FOR CHARITABLE PURPOSES OUT OF THE IN COME OF THE TRUST FOR THAT PREVIOUS YEAR. THE AO IN HIS COUNTER COMMENTS DATED 30.08.2013 MERELY MENTIONED THAT THE DETAILS HAD ALREADY BEEN CONSIDERED IN THE ASSESSMENT ORDER AT PAGE-11. NO SUBMISSIONS WERE GIVEN BY THE AO AS TO WHY THIS CAS E IS NOT APPLICABLE IN THE APPELLANT'S CASE. THE HON'BLE SUPREME COURT IN THE CASE OF A.L.N. RAO C HARITABLE TRUST HAS HELD AS UNDER:- 'A MERE LOOK AT SECTION 11(1) (A) AS IT STOOD AT TH E RELEVANT TIME CLEARLY SHOWS THAT OUT OF THE TOTAL INCOME ACCRUING TO A TRUST IN THE PREVIOUS YEAR FROM PROPERTY HELD BY IT WHOLLY F OR CHARITABLE OR RELIGIOUS PURPOSES, TO THE EXTENT THE INCOME IS APP LIED FOR SUCH RELIGIOUS OR CHARITABLE PURPOSES, THE SAME WILL GET OUT OF THE TAX NET BUT SO FAR AS THE INCOME WHICH IS NOT SO APPLIE D DURING THE PREVIOUS YEAR IS CONCERNED AT LEAST 25 PER CENT, OF SUCH INCOME OR RS. 10,000, WHICHEVER IS HIGHER, WILL BE PERMITTED TO BE ACCUMULATED FOR CHARITABLE OR RELIGIOUS PURPOSE AND IT WILL ALSO GET EXEMPTED FROM THE TAX NET. THEN FOLLOWS SUB-SECTION (2) WHICH SEEKS TO LIFT THE RESTRICTION OR THE CEILING IMPOSED ON SUCH EXEMPTED ACCUMULATED INCOME DURING THE PREVIOUS YEAR AND ALSO BRINGS SUCH FURTHER ACCUMULATED INCOME OUT OF THE TAX NET IF THE CONDITIONS LAID DOWN BY SUB-SECTION (2) OF SECT ION 11 ARE FULFILLED MEANING THEREBY THE MONEY SO ACCUMULA TED IS SET APART TO BE INVESTED IN THE GOVERNMENT SECURITIES, ETC., AS LAID DOWN BY CLAUSE (B) OF SUB-SECTION (2) OF SECTION 11 APART FROM THE PROCEDURE LAID DOWN BY CLAUSE (A) OF SECTION 11 (2) BEING FOLLOWED BY THE ASSESSEE-TRUST. TO HIGHLIGHT THIS P OINT WE MAY TAKE AN ILLUSTRATION. IF RS. 1,00,000 ARE EARNED AS THE TOTAL INCOME OF THE PREVIOUS YEAR BY THE TRUST FROM PROPE RTY HELD BY IT WHOLLY FOR CHARITABLE AND RELIGIOUS PURPOSES AND IF RS. 20,000 ARE ACTUALLY APPLIED DURING THE PREVIOUS YEAR BY TH E SAID TRUST TO SUCH CHARITABLE OR RELIGIOUS PURPOSES THE INCOME OF RS.20,000 WILL GET EXEMPTED FROM BEING CONSIDERED F OR THE PURPOSE OF INCOME-TAX UNDER THE FIRST PART OF SECTI ON 11(1). SO 7 FAR AS THE REMAINING RS. 80,000 ARE CONCERNED IF TH EY COULD NOT BE ACTUALLY APPLIED FOR SUCH RELIGIOUS OR CHARITABL E PURPOSES DURING THE PREVIOUS YEAR THEN AS PER SECTION 11 (1) (A) AT LEAST 25 PER CENT, OF SUCH TOTAL INCOME FROM PROPERTY OR RS. 10,000, WHICHEVER IS HIGHER, WILL ALSO EARN EXEMPTION FROM BEING CONSIDERED AS INCOME FOR THE PURPOSE OF INCOME-TAX, THAT IS, RS. 25,000 WILL THUS GET EXCLUDED FROM THE TAX NET. THU S OUT OF THE TOTAL INCOME OF RS. 1,00,000 WHICH HAS ACCRUED TO T HE TRUST RS. 25,000 WILL EARN EXEMPTION FROM PAYMENT OF INCOME-T AX AS PER SECTION 11(1) (A), SECOND PART. THEN FOLLOWS SUB-SE CTION (2) WHICH STATES THAT THE CEILING OR THE LIMIT OR THE R ESTRICTION OF ACCUMULATION OF INCOME TO THE EXTENT OF 25 PER CENT , OF THE INCOME OR RS. 10,000, WHICHEVER IS HIGHER, FOR EARN ING INCOME- TAX EXEMPTION AS ENGRAFTED UNDER SECTION 11(1) (A) WILL GET LIFTED IF THE MONEY SO ACCUMULATED IS INVESTED AS LAID DOW N BY SECTION LL(2)(B) MEANING THEREBY, OUT OF THE TOTAL ACCUMULA TED INCOME OF RS. 80,000 ACCRUING DURING THE PREVIOUS YEAR AND WHICH COULD NOT BE SPENT FOR CHARITABLE OR RELIGIOUS PURPOSES B Y THE TRUST, THE BALANCE OF RS. 55,000 IF INVESTED AS LAID DOWN BY S UB-SECTION (2) OF SECTION 11 WILL ALSO GET EXCLUDED FROM THE TAX N ET. BUT FOR SUCH INVESTMENT AND IF SECTION 11(1) ALONE HAD APPLIED R S. 55,000 BEING THE BALANCE OF THE ACCUMULATED INCOME WOULD H AVE BEEN COVERED BY THE TAX NET. LEARNED COUNSEL FOR THE REV ENUE SUBMITTED THAT THE INVESTMENT AS CONTEMPLATED BY SU B-SECTION (2)(B) OF SECTION 11 MUST BE INVESTMENT OF ALL THE ACCUMULATED INCOME IN GOVERNMENT SECURITIES, ETC., NAMELY, 100 PER CENT OF THE ACCUMULATED INCOME AND NOT ONLY 75 PER CENT, THEREO F. AND IF THAT IS NOT DONE, THEN ONLY THE INVESTED ACCUMULATE D INCOME TO THE EXTENT OF 75 PER CENT, WILL GET EXCLUDED FROM I NCOME-TAX ASSESSMENT. BUT SO FAR AS THE REMAINING 25 PER CENT , OF THE ACCUMULATED INCOME IS CONCERNED, IT WILL NOT EARN S UCH EXEMPTION. IT IS DIFFICULT TO APPRECIATE THIS CONTE NTION. THE REASON IS OBVIOUS. SECTION 11, SUBSECTION (L)(A) OP ERATES ON ITS OWN. BY ITS OPERATION TWO TYPES OF INCOME EARNED BY THE TRUST DURING THE PREVIOUS YEAR FROM ITS PROPERTIES ARE GI VEN EXEMPTION FROM INCOME-TAX: (I) THAT PART OF THE INCOME OF THE PREVIOUS YEAR WH ICH IS ACTUALLY SPENT FOR CHARITABLE OR RELIGIOUS PURPOSES IN THAT YEAR; AND II) OUT OF THE UNSPENT ACCUMULATED INCOME OF THE PR EVIOUS YEAR 25 PER CENT, OF SUCH TOTAL PROPERTY INCOME OR RS. 1 0,000, 8 WHICHEVER IS HIGHER, CAN BE PERMITTED TO BE ACCUMUL ATED BY THE TRUST, EARMARKED FOR SUCH CHARITABLE OR RELIGIOUS P URPOSES. SUCH 25 PER CENT, OF THE INCOME OR RS. 10,000, WHICHEVER IS HIGHER, WILL ALSO GET EXEMPTED FROM INCOME-TAX. THAT EXHAUSTS TH E OPERATION OF SECTION 11(1) (A). THEN FOLLOWS SUB-SECTION (2) WHI CH NATURALLY DEALS WITH THE QUESTION OF INVESTMENT OF THE BALANC E OF ACCUMULATED INCOME WHICH HAS STILL NOT EARNED EXEMP TION UNDER SUBSECTION (L)(A). SO FAR AS THAT BALANCE OF THE AC CUMULATED INCOME IS CONCERNED, THAT ALSO CAN EARN EXEMPTION F ROM INCOME- TAX MEANING THEREBY THE CEILING OR THE LIMIT OF EXE MPTION OF ACCUMULATED INCOME FROM INCOME-TAX AS IMPOSED BY SU BSECTION (I) (A) OF SECTION 11 WOULD GET LIFTED IF ADDITIONA L ACCUMULATED INCOME BEYOND 25 PER CENT, OR RS. 10,000, WHICHEVER IS HIGHER, AS THE CASE MAY BE, IS INVESTED AS LAID DOWN BY SEC TION 11(2) AFTER FOLLOWING THE PROCEDURE LAID DOWN THEREIN. THEREFOR E, SUB-SECTION (2) ONLY WILL HAVE TO OPERATE QUA THE BALANCE OF 75 PER CENT, OF THE TOTAL INCOME OF THE PREVIOUS YEAR OR INCOME BEYOND RS. 10,000, WHICHEVER IS HIGHER, WHICH HAS NOT GOT THE BENEFIT OF TAX EXEMPTION UNDER SUBSECTION (L)(A) OF SECTION 11. IF LEARNED COUNSEL FOR THE REVENUE IS RIGHT AND IF 100 PER CEN T, OF THE ACCUMULATED INCOME OF THE PREVIOUS YEAR IS TO BE IN VESTED UNDER SUB-SECTION (2) OF SECTION 11 TO GET EXEMPTION FROM INCOME-TAX, THEN THE CEILING OF 25 PER CENT, OR RS. 10,000, WHI CHEVER IS HIGHER, WHICH IS AVAILABLE FOR ACCUMULATION OF INCO ME OF THE PREVIOUS YEAR FOR THE TRUST TO EARN EXEMPTION FROM INCOME-TAX AS LAID DOWN BY SECTION 11(1) (A) WOULD BE RENDERED RE DUNDANT AND THE SAID EXEMPTION PROVISION WOULD BECOME OTIOSE. I T HAS TO BE KEPT IN VIEW THAT OUT OF THE ACCUMULATED INCOME OF THE PREV IOUS YEAR AN AMOUNT OF RS. 10,000 OR 25 PER CENT, OF THE TOTAL INCOME FROM PROPERTY, WHICHEVER IS HIGHER, IS GIVEN EXEMPT ION FROM INCOME-TAX BY SECTION 11(1) (A) ITSELF. THAT EXEMPT ION IS UNFETTERED AND NOT SUBJECT TO ANY CONDITIONS. IN OTHER WORDS, IT IS AN ABSOLUTE EXEMPTION. IF SUB SECTION (2) IS SO READ A S SUGGESTED BY LEARNED COUNSEL FOR THE REVENUE, WHAT IS AN ABSOLUT E AND UNFETTERED EXEMPTION OF ACCUMULATED INCOME AS GUARA NTEED BY SECTION 11(1) (A) WOULD BECOME A RESTRICTED EXEMPTI ON AS LAID DOWN BY SECTION 11(2). SECTION 11(2) DOES NOT OPERA TE TO WHITTLE DOWN OR TO CUT ACROSS THE EXEMPTION PROVISI ONS CONTAINED IN SECTION 11(1) (A) SO FAR AS SUCH ACCUM ULATED INCOME OF THE PREVIOUS YEAR IS CONCERNED. IT HAS ALSO TO B E APPRECIATED THAT SUBSECTION (2) OF SECTION 11 DOES NOT CONTAIN ANY NON OBSTANTE CLAUSE LIKE ' NOTWITHSTANDING THE PROVISIO NS OF SUB- 9 SECTION (1) '. CONSEQUENTLY, IT MUST BE HELD THAT A FTER SECTION 11(1) (A) HAS FULL PLAY AND IF STILL ANY ACCUMULATED INCO ME OF THE PREVIOUS YEAR IS LEFT TO BE DEALT WITH, AND TO BE C ONSIDERED FOR THE PURPOSE OF INCOME-TAX EXEMPTION, SUB-SECTION (2 ) OF SECTION 11 CAN BE PRESSED INTO SERVICE AND IF IT IS COMPLIE D WITH THEN SUCH ADDITIONAL ACCUMULATED INCOME BEYOND 25 PER CENT, O R RS. 10,000, WHICHEVER IS HIGHER, CAN ALSO EARN EXEMPTION FROM I NCOME-TAX ON COMPLIANCE WITH THE CONDITIONS LAID DOWN BY SUB-SEC TION (2) OF SECTION 11. IT IS TRUE THAT SUB-SECTION (2) OF SECT ION 11 HAS NOT CLEARLY MENTIONED THE EXTENT OF THE ACCUMULATED INC OME WHICH IS TO BE INVESTED. BUT ON A CONJOINT READING OF THE AF ORESAID TWO PROVISIONS OF SECTIONS 11(1) AND 11(2), THIS IS THE ONLY RESULT WHICH CAN FOLLOW. IT IS ALSO TO BE KEPT IN VIEW THAT UNDE R THE EARLIER INCOME-TAX ACT OF 1922, EXEMPTION WAS AVAILABLE TO CHARITABLE TRUSTS WITHOUT ANY RESTRICTION UPON THE ACCUMULATED INCOME. THERE WAS A CHANGE IN THIS RESPECT UNDER THE PRESENT ACT OF 1961. UNDER THE PRESENT ACT, ANY INCOME ACCUMULATED IN EXCESS O F 25 PER CENT, OR RS. 10,000, WHICHEVER IS HIGHER, IS TAXABLE UNDE R SECTION 11(1) (A) OF THE ACT, UNLESS THE SPECIAL CONDITIONS REGAR DING ACCUMULATION AS LAID DOWN IN SECTION 11(2) ARE COMP LIED WITH. IT IS CLEAR, THEREFORE, THAT IF THE ENTIRE INCOME RECE IVED BY A TRUST IS SPENT FOR CHARITABLE PURPOSES IN INDIA, THEN IT WIL L NOT BE TAXABLE, BUT IF THERE IS A SAVING, THAT IS TO SAY, AN ACCUMU LATION OF 25 PER CENT, OR RS. 10,000, WHICHEVER IS HIGHER, IT WILL N OT BE INCLUDED IN THE TAXABLE INCOME. SECTION 11(2) QUOTED ABOVE FURT HER LIBERALIZES AND ENLARGES THE EXEMPTION. A COMBINED READING OF B OTH THE PROVISIONS QUOTED ABOVE WOULD CLEARLY SHOW THAT SEC TION 11(2), WHILE ENLARGING THE SCOPE OF EXEMPTION, REMOVES THE RESTRICTION IMPOSED BY SECTION 11(1) (A), BUT IT DOES NOT TAKE AWAY THE EXEMPTION ALLOWED BY SECTION 11(1) (A). ON THE EXPR ESS LANGUAGE OF SECTIONS 11(1) AND 11(2) AS THEY STOOD ON THE ST ATUTE BOOK AT THE RELEVANT TIME, NO OTHER VIEW IS POSSIBLE. IN THE LIGHT OF THE AFORESAID DISCUSSION AND KEEPIN G IN VIEW THE ILLUSTRATION WHICH WE HAVE GIVEN EARLIER, THE COMBI NED OPERATION OF SECTION 11(1) (A) AND SECTION 11(2) AS APPLICABLE A T THE RELEVANT TIME WOULD YIELD THE FOLLOWING RESULT: (I) IF THE INCOME DERIVED FROM PROPERTY HELD UNDER TRUST WHOLLY FOR CHARITABLE OR RELIGIOUS PURPOSES DURING THE PRE VIOUS YEAR IS RS. 1,00,000 AND IF RS. 20,000 THEREFROM ARE ACTUAL LY APPLIED TO SUCH PURPOSES IN INDIA THEN THOSE RS. 20,000 WILL G ET EXEMPTED 10 FROM PAYMENT OF INCOME-TAX AS PER THE FIRST PART OF SECTION LL(L)(A). (II) OUT OF THE REMAINING ACCUMULATED INCOME OF RS. 80,000 FOR THE PREVIOUS YEAR, A FURTHER SUM OF RS. 25,000 WILL GET EXEMPTED FROM PAYMENT OF INCOME-TAX AS PER THE SECOND PART O F SECTION 11(1) (A). THUS, OUT OF THE TOTAL INCOME DERIVED FR OM PROPERTY AS AFORESAID DURING THE PREVIOUS YEAR, THAT IS, RS. 1, 00,000, RS. 45,000 IN ALL WILL GET EXCLUDED FROM THE TAX NET ON A COMBINED OPERATION OF THE FIRST AND THE SECOND PART OF SECTI ON 11(1) (A). (III) THE AFORESAID CEILING OF RS. 25,000 OF THE AC CUMULATED INCOME FROM PROPERTY OF THE PREVIOUS YEAR, WILL GET LIFTED UNDER SECTION 11(2) TO THE EXTENT THE BALANCE OF SUCH ACC UMULATED INCOME IS INVESTED AS LAID DOWN BY SECTION 11(2). T O TAKE AN ILLUSTRATION IF, SAY, AN ADDITIONAL AMOUNT OF RS. 2 0,000 OUT OF THE BALANCE OF ACCUMULATED INCOME OF RS. 55,000 IS INVE STED AS PER SECTION 11(2), THEN THIS ADDITIONAL AMOUNT OF RS. 2 0,000 OF ACCUMULATED INCOME WILL GET EXCLUDED FROM THE TAX N ET AS PER SECTION 11 (2). (IV) THE REMAINING BALANCE OF THE ACCUMULATED INCOM E OUT OF RS. 55,000, THAT IS, RS. 35,000 IF NOT INVESTED AS PER SUB-SECTION (2) OF SECTION 11, WILL BE ADDED TO THE TAXABLE INCOME OF THE TRUST AND WILL NOT GET EXEMPTED FROM THE TAX NET. (V) IF, ON THE OTHER HAND, THE ENTIRE REMAINING ACC UMULATED INCOME OF RS. 55,000 IS WHOLLY INVESTED AS PER SECT ION 11 (2), THE SAID ENTIRE AMOUNT OF RS. 55,000 WILL GET EXEMPTED FROM THE TAX NET. ' 5.7 THIS DECISION OF THE HON'BLE SUPREME COURT CLEA RLY HELD THAT THERE IS A BLANKET EXEMPTION WITH REGARD TO THE 25% (NOW 15%) OF GROSS RECEIPTS AS PER SECOND PART OF SECTION LL(L)( A) OF THE INCOME TAX ACT. THIS EXEMPTION OF 25% IS NOT DEPENDENT ON ANY OTHER CONDITION EXCEPT THAT THE TRUST OR SOCIETY SHOULD BE REGISTERED U/S 12AA OF THE INCOME TAX ACT. THE ONLY ISSUE TO BE EXAMINED HERE IS WHETHER THE PROVISIONS OF SECTION 11(1) (A) AND 11(2) HAVE BEEN SINCE AMENDED AND IF SO, WHETHER THE AFORESAID DECISION WOULD APPLY TO T HE AMENDED PROVISIONS ALSO? 5.8 THE PROVISIONS OF SECTION LL(L)(A) AND 11 (2) A S THEY WERE IN FORCE IN THE YEAR 1968-69 RELEVANT TO AY 69-70, I.E THE YEAR TO WHICH 11 THE CASE OF A.L.N. RAO CHARITABLE TRUST (SUPRA) REL ATES HAVE BEEN REPRODUCED IN THE ORDER OF THE HON'BLE SUPREME COUR T ITSELF AS UNDER: 'THESE PROVISIONS AS THEY STOOD AT THE RELEVANT TIM E READ AS UNDER: '11. (1) SUBJECT TO-THE PROVISIONS OF SECTIONS 60 T O 63, THE FOLLOWING INCOME SHALL NOT BE INCLUDED IN THE TOTAL INCOME OF THE PREVIOUS YEAR OF THE PERSON IN RECEIPT OF THE INCOM E (A) INCOME DERIVED FROM PROPERTY HELD UNDER TRUST W HOLLY FOR CHARITABLE OR RELIGIOUS PURPOSES TO THE EXTENT TO W HICH SUCH INCOME IS APPLIED TO SUCH PURPOSES IN INDIA ; AND, WHERE ANY SUCH INCOME IS ACCUMULATED FOR APPLICATION TO SUCH PURPOSES IN INDIA, TO THE EXTENT TO WHICH THE INCOME SO ACCUMUL ATED IS NOT IN EXCESS OF TWENTY-FIVE PER CENT, OF THE INCOME FR OM THE PROPERTY OR RUPEES TEN THOUSAND, WHICHEVER IS HIGHE R,... (2) WHERE THE PERSONS IN RECEIPT OF THE INCOME HAVE COMPLIED WITH THE FOLLOWING CONDITIONS, THE RESTRICTION SPEC IFIED IN CLAUSE (A) OR CLAUSE (B) OF SUB-SECTION (1) AS RESPECTS AC CUMULATION OR SETTING APART SHALL NOT APPLY FOR THE PERIOD DURING WHICH THE SAID CONDITIONS REMAIN COMPLIED WITH (A) SUCH PERSONS HAVE, BY NOTICE IN WRITING GIVEN T O THE INCOME- TAX OFFICER IN THE 'PRESCRIBED MANNER, SPECIFIED TH E PURPOSE FOR WHICH THE INCOME IS BEING ACCUMULATED OR SET APART AND THE PERIOD FOR WHICH THE INCOME IS TO BE ACCUMULATED OR SET APART, WHICH SHALL IN NO CASE EXCEED TEN YEARS. (B) THE MONEY SO ACCUMULATED OR SET APART IS INVEST ED IN ANY GOVERNMENT SECURITY AS DEFINED IN CLAUSE (2) OF SEC TION 2 OF THE PUBLIC DEBT ACT, 1944 (18 OF 1944), OR IN ANY OTHER SECURITY WHICH MAY BE APPROVED BY THE CENTRAL GOVERNMENT IN THIS BEHALF.' 5.9 THE PROVISIONS OF SECTION LL(L)(A) AND 11 (2) A S THEY WERE IN FORCE IN THE YEAR 2009-2010, I.E THE YEAR TO WHICH THE PRESENT CASE RELATES ARE REPRODUCED AS UNDER: '11. INCOME FROM PROPERTY HELD FOR CHARITABLE OR RE LIGIOUS PURPOSES. 12 (1) SUBJECT TO THE PROVISIONS OF SECTIONS 60 TO 63, THE FOLLOWING INCOME SHALL NOT BE INCLUDED IN THE TOTAL INCOME OF THE PREVIOUS YEAR OF THE PERSON IN RECEIPT OF THE INCOME- (A) INCOME DERIVED FROM PROPERTY HELD UNDER TRUST W HOLLY FOR CHARITABLE OR RELIGIOUS PURPOSES, TO THE EXTENT TO WHICH SUCH INCOME IS APPLIED TO SUCH PURPOSES IN INDIA; AND, W HERE ANY SUCH INCOME IS ACCUMULATED OR SET APART FOR APPLICA TION TO SUCH PURPOSES IN INDIA, TO THE EXTENT TO WHICH THE INCOM E SO ACCUMULATED OR SET APART IS NOT IN EXCESS OF FIFTEE N PER CENT OF THE INCOME FROM SUCH PROPERTY; (2) WHERE EIGHTY-FIVE PER CENT, OF THE INCOME REFER RED TO IN CLAUSE (A) OR CLAUSE (B) OF SUB-SECTION (1) READ WITH THE EXPLANATION TO THAT SUBSECTION IS NOT APPLIED, OR IS NOT DEEMED TO HAVE BEEN APPLIED, TO CHARITABLE OR RELIGIOUS PURPOSES IN IND IA DURING THE PREVIOUS YEAR BUT IS ACCUMULATED OR SET APART, EITH ER 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 T HE TOTAL INCOME OF THE PREVIOUS YEAR OF THE PERSON IN RECEIPT OF TH E INCOME, PROVIDED THE FOLLOWING CONDITIONS ARE COMPLIED WITH , NAMELY (A) SUCH PERSON SPECIFIES, BY NOTICE IN WRITING GIV EN TO THE ASSESSING OFFICER IN THE PRESCRIBED MANNER, THE PUR POSE FOR WHICH THE INCOME IS BEING ACCUMULATED OR SET APART AND THE PERIOD FOR WHICH THE INCOME IS TO BE 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 SUB-SE CTION (5): PROVIDED THAT IN COMPUTING THE PERIOD OF TEN YEARS REFERRED TO IN CLAUSE (A), THE PERIOD DURING WHICH THE INCOME COUL D NOT BE APPLIED FOR THE PURPOSE FOR WHICH IT IS SO ACCUMULA TED OR SET APART, DUE TO AN ORDER OR INJUNCTION OF ANY COURT, SHALL BE EXCLUDED: PROVIDED FURTHER THAT IN RESPECT OF ANY INCOME ACCU MULATED OR SET APART ON AFTER THE 1ST DAY OF APRIL, 2001, THE PROVISIONS OF THIS SUB-SECTION SHALL HAVE EFFECT AS IF FOR THE WO RDS 'TEN YEARS ' AT BOTH THE PLACES WHERE THEY OCCUR, THE WORDS 'FIVE Y EARS ' HAD BEEN SUBSTITUTED. 13 5.10 IT IS APPARENT FROM THE READING OF PROVISIONS REFERRED TO ABOVE THAT SECTION11 (A) WAS ALMOST IDENTICAL DURING THE AY 69-70 AND DURING AY 20010-11. AS REGARDS THE PROVISIONS OF S ECTION 11(2) ARE CONCERNED, EVEN THE AMENDED SUB SECTION (2) OPERATE S QUA THE BALANCE OF 85 PER CENT, OF THE TOTAL INCOME OF THE PREVIOUS YEAR WHICH HAS NOT GOT THE BENEFIT OF TAX EXEMPTION UNDER SUB-SECTION(L)(A) OF SECTION 11. SECTION 11(2), AS AMENDED, DOES NOT OPERATE TO WHITTLE DOWN OR TO CUT ACROSS THE EXEMPT ION PROVISIONS CONTAINED IN SECTION LL(L)(A)SO FAR AS SUCH ACCUMUL ATED INCOME OF THE PREVIOUS YEAR IS CONCERNED. AS HELD BY THE HON 'BLE SUPREME COURT IN THE CASE OF A.L.N. RAO CHARITABLE TRUST (S UPRA),IT HAS TO BE APPRECIATED THAT SUB-SECTION (2) OF SECTION 11 DOES NOT CONTAIN ANY NON OBSTANTE CLAUSE LIKE 'NOTWITHSTANDING T HE PROVISIONS OF SUB- SECTION(1)'.CONSEQUENTLY, IT MUST BE HELD THAT AFTE R SECTION LL(L)(A) HAS FULL PLAY AND IF STILL ANY ACCUMULATED INCOME O F THE PREVIOUS YEAR IS LEFT TO BE DEALT WITH, AND TO BE CONSIDERED FOR THE PURPOSE OF INCOME- TAX EXEMPTION, SUB-SECTION (2) OF SECTION 11 CAN BE PRESSED INTO SERVICE AND IF IT IS COMPLIED WITH THEN SUCH ADDITI ONAL ACCUMULATED INCOME BEYOND 15 PER CENT, CAN ALSO EAR N EXEMPTION FROM INCOME-TAX ON COMPLIANCE WITH THE CONDITIONS LAID D OWN BY SUB-SECTION (2) OF SECTION 11. 5.11 IT MAY ALSO BE RELEVANT TO REFER TO THE VIEWS EXPRESSED BY 'CHATURVEDI AND PITHISARIA' ON THIS ISSUE. THESE VIEWS READ AS UNDER: 'SECTION 11 HAS UNDERGONE AMENDMENTS MORE THAN ONCE . IN ORDER TO BE ABLE TO BETTER GRASP THE PROVISIONS AS APPLIC ABLE FROM TIME TO TIME, IT WILL BE BETTER TO PUT THE EFFECT OF SUC H PROVISIONS, EXCEPT THOSE OF SUB-SECTION (1A) DEALT SEPARATELY H EREUNDER, VIS- A-VIS EXEMPTION AND TAXABILITY OF INCOME DERIVED FR OM PROPERTY HELD UNDER CHARITABLE OR RELIGIOUS TRUST, IN A TABU LAR FORM SUBJECT-WISE. THUS:- INCOME DERIVED FROM PROPERTY HELD UNDER TRUST OF OT HER LEGAL OBLIGATION WHOLLY FOR CHARITABLE PURPOSES AND SUCH INCOME OR PART THEREOF IS NOT APPLIED TO SUCH PURPOSES IN INDIA DURING THE PREVIOUS YEAR WHEREIN IT IS DERIVED, BUT IS ACCUMULATED FOR APPLICATION TO SUCH PURPOSES IN IND IA: - 1 2 3 4 1922 ACT PROVISIONS 1961 ACT PROVISIONS APPLICABLE FOR AY 1961 ACT PROVISIONS APPLICABLE FOR AY 1961 ACT PROVISIONS APPLICABLE FROM 14 1962-63 TO 1970-71 1971-72 TO 1975-76 1976 ONWARDS UNCONDITIONALLY EXEMPT {S.4(3)(I)}. CONDITIONALLY EXEMPTION - (A) IF A NOTICE IN FROM NO. 10 IS GIVEN TO THE 1TO IN ACCORDANCE WITH RULE 17 AND INCOME SO ACCUMULATED {MINUS ACCUMULATION PERMITTED UNDER (B), BELOW} IS INVESTED IN GOVERNMENT SECURITIES, OR OTHER APPROVED SECURITIES, THE ACCUMULATION UP TO A PERIOD OF TEN YEARS IS EXEMPT [S. LL(L)(A), LATTER PART, READ WITH S. 11(2)}; AND (B) IF CONDITIONS AT (A) ARE NOT FULFILLED, ACCUMULATION TO THE EXTENT OF 25 PER CENT OF THE INCOME FROM THE PROPERTY OR RS. 10,000/- WHICHEVER IS HIGHER, IS EXEMPT. IN COMPUTING THE 25 PER CENT., THE INCOME FROM SUCH PROPERTY FOR THE RELEVANT PREVIOUS YEAR OR THE IMMEDIATELY PRECEDING PREVIOUS YEAR, WHICHEVER IS HIGHER, MAY BE TAKEN [S. 11(1) (A), LATTER PART, READ WITH THE EXPLANATION]. _____________ CONDITIONALLY EXEMPT - (A) IF A NOTICE IN FORM NO. 10 IS GIVEN TO THE 1TO IN ACCORDANCE WITH RULE 17 AND INCOME SO ACCUMULATED ACCUMULATION PERMITTED UNDER (B), BELOW] IS INVESTED IN THE GOVERNMENT SECURITIES OR OTHER APPROVED SECURITIES OR IS DEPOSITED IN POST OFFICE SAVINGS BANK ACCOUNTS OR UNDER THE POST OFFICER (TIME DEPOSITS) RULES, 1970, OR IN A BANKING COMPANY TO WHICH THE BANKING REGULATION ACT, 1949, APPLIES OR CO- OPERATIVE LAND MORTGAGE BANK OR A COOPERATIVE LAND DEVELOPMENT BANK, OR DEPOSITED IN AN ACCOUNT WITH AN APPROVED FINANCIAL CORPORATION, THE ACCUMULATION UP TO A PERIOD OF TEN YEARS IS EXEMPT [S. 11(2)]. [(B) NO SUCH EXEMPTION]. CONDITIONALLY EXEMPT - (A) SAME AS IN COL. (3), FOR ASSESSMENT YEARS 1976-77 TO 1982- 83. FOR AND FROM ASSESSMENT YEAR 1983-84, INVESTMENT OR DEPOSIT IS TO BE MADE IN THE FORMS OR MODES SPECIFIED IN SECTION 11(5). (B) IF CONDITIONS AT (A) ARE NOT FULFILLED, ACCUMULATION TO THE EXTENT OF 25% ONLY IS EXEMPT. IN COMPUTING THE 25%, ANY VOLUNTARY CONTRIBUTIONS REFERRED TO IN S. 12 SHALL BE DEEMED TO BE PART OF THE INCOME [S. 11(1)(A), LATTER PART READ WITH EXPL. (1)]. 5.12 AS SUCH, THIS JUDGEMENT OF THE HON'BLE SUPREME COURT IS SQUARELY APPLICABLE TO THE APPELLANT'S CASE. THE AP PELLANT IS THUS ELIGIBLE FOR EXEMPTION OF 15% OF GROSS RECEIPTS I.E . 15% OF RS.9,85,33,522/- U/S LL(L)(A) OF THE INCOME TAX ACT . THE AO IS ACCORDINGLY DIRECTED TO ALLOW THIS EXEMPTION OF 15% OF THE GROSS RECEIPTS AMOUNTING TO RS.1,47,80,028/-. THIS GROUND OF APPEAL IS ACCORDINGLY ALLOWED. 15 15. AFTER HEARING THE RIVAL CONTENTIONS, WE DO NOT FIND ANY MERIT IN THIS GROUND OF APPEAL OF THE REVE NUE. THE LEARNED CIT (APPEALS) ON PROPER APPRECIATION OF FACTS IN THE LIGHT OF THE PROVISIONS OF SECTION 11 OF THE ACT AND THE JUDGMENT OF THE HON'BLE SUPREME COURT I N THE CASE OF A.L.N. RAO CHARITABLE TRUST (SUPRA) RI GHTLY DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE. THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE JUDGMEN T OF THE HON'BLE SUPREME COURT NOTED ABOVE IN THE FINDIN GS OF THE LEARNED CIT (APPEALS). THE LEARNED D.R FOR THE REVENUE DID NOT CONTRIBUTE MUCH ON THIS ISSUE AND MERELY RELIED UPON THE ORDER OF THE ASSESSING OFFIC ER WITHOUT POINTING OUT ANY INFIRMITY IN THE ORDER OF THE LEARNED CIT (APPEALS) IN ALLOWING THE EXEMPTION OF 15% ON THE GROSS RECEIPTS. THUS WE DO NOT FIND ANY JUSTIFICATION TO INTERFERE IN THE ORDER OF THE LEAR NED CIT (APPEALS). THIS GROUND OF DEPARTMENTAL APPEAL IS ACCORDINGLY DISMISSED. 10. IN VIEW OF THE ABOVE DECISIONS IN THE CASE OF B HARTIYA VIDYA MANDIR TRUST (SUPRA) WE SET ASIDE THE ORDERS OF AUTHORITIES BELOW AND DIRECT THE ASSESSING OFFICER TO ALLOW BENEFIT OF 15% ACCUMULATION AMOUNTING TO RS. 2,61,86,197/- AS PER LAW. 11. IN THE RESULT, APPEAL OF THE ASSESSEE IS ALLOWE D. ITA NO. 815/CHD/2014 : (A.Y. 2008-09) 12. THIS APPEAL BY ASSESSEE IS DIRECTED AGAINST THE ORDER OF LD. CIT(APPEALS) SHIMLA DATED 23.07.2014 FOR ASSESS MENT YEAR 2008-09. 13. GROUND NO. 1 IS GENERAL. THE SAME IS DISMISSED . 14. THE LD. COUNSEL FOR THE ASSESSEE DID NOT PRESS GROUND NO. 3. SAME IS ALSO DISMISSED AS NOT PRESSED. 15. THE ONLY GROUND LEFT FOR CONSIDERATION IS CLAIM UNDER SECTION 11(1)(A) WITH REGARD TO BENEFIT OF 15% ACCU MULATION 16 AMOUNTING TO RS. 2,39,40,595/-. BOTH THE PARTIES S TATED THAT THE FINDINGS OF AUTHORITIES BELOW ARE SAME AS HAVE BEEN CONSIDERED IN ASSESSMENT YEAR 2007-08 AND THE ISSUE IS IDENTICAL. THEREFORE, ORDER IN ASSESSMENT YEAR 200 7-08 MAY BE FOLLOWED FOR DECIDING THIS APPEAL AS WELL. 16. WE FIND THAT PARTIES ARE JUSTIFIED IN CONTENDIN G THAT THE ISSUE IS IDENTICAL WHICH HAVE BEEN CONSIDERED IN IT A 814/CHD/2014 FOR ASSESSMENT YEAR 2007-08. THEREFOR E, FOLLOWING THE REASONS FOR DECISION IN ASSESSMENT YE AR 2007- 08 ABOVE, WE SET ASIDE THE ORDERS OF AUTHORITIES BE LOW AND DIRECT TO GRANT BENEFIT TO THE ASSESSEE UNDER SECTI ON 11(1)(A) OF THE ACT OF 15% ACCUMULATION OF THE AMOUNT IN QUE STION. THIS GROUND OF APPEAL OF ASSESSEE IS ACCORDINGLY, A LLOWED. 17. IN THE RESULT, APPEAL OF ASSESSEE IS PARTLY ALL OWED. 18. IN THE RESULT, ITA 814/CHD/2014 IS ALLOWED AND ITA 815/CHD/2014 IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH JULY,2015. SD/- SD/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 15 TH JULY,2015. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT CHANDIGARH