Section 11 of the Income tax Act, 1961 — Trust — Exemption to trust — In the case of Dharmodayam Co. the Tribunal had ultimately found the issue in favour of the assessee therein. But question as to whether a similar situation prevails in the instant case which would satisfy the different conditions stipulated under sub-section (4A), is a matter which requires examination.[2019] 52 ITCD 125 (KER)
Facts: Being aggrieved of the order of Tribunal, Revenue went on appeal before High Court and raised the question of law that whether, on the facts and in the circumstances of the case and in view of sub-section (4A) of Section 11, the assessee is entitled to exemption u/s.11 of the Income-tax Act? Whether, on the facts and in the circumstances of the case, the assessee is right in law and fact in holding that the assessee is a religious and charitable institution and carried on kuri business for utilizing the income therefrom also for the charitable purpose such as medical relief, education etc.?Whether, on the facts and in the circumstances of the case, the Tribunal is right in holding that the interest claimed cannot be taxed in the hands of the assessee trust as it is exempt from taxation?”
Held, that we are of the considered opinion that in view of the remand made by the hon'ble Supreme Court in Dharmodayam Co. case, the matter requires reconsideration by the Tribunal. Of course, we take note of the fact that in the case of Dharmodayam Co. the Tribunal had ultimately found the issue in favour of the assessee therein. But question as to whether a similar situation prevails in the instant case which would satisfy the different conditions stipulated under sub-section (4A), is a matter which requires examination. Since some of the reference cases are of the year 2005, we do not think it appropriate to dismiss them on the basis of the litigation policy of the Government. Instead we leave it open to the respondent to take up such contention before the Tribunal, at the time when the matter is considered afresh. Under the above mentioned circumstances, instead of specifically answering question of law referred, we think it only appropriate to remit the income tax appeals for fresh consideration and disposal by the Appellate Tribunal on the basis of the decision rendered by the hon'ble Supreme Court in Commissioner of Income Tax V. Dharmodayam Co. and another (2001) 248 ITR 816.