2008-VIL-580-P&H-DT

Equivalent Citation: [2009] 309 ITR 275 (P&H)

PUNJAB AND HARYANA HIGH COURT

609 of 2007

Date: 15.12.2008

COMMISSIONER OF INCOME-TAX

Vs

HARYANA CM RELIEF FUND

Yogesh Putney for the appellant.
Akshay Bhan, and Sandeep Goyal for the respondent.

BENCH

ADARSH KUMAR GOEL and L. N. MITTAL JJ.

JUDGMENT

The judgment of the court was delivered by

ADARSH KUMAR GOEL, J. - The Revenue has preferred this appeal under Section 260A of the Income Tax Act, 1961 (for short, "the Act") against the order dated 25.4.2007 of the Income Tax Appellate Tribunal (ITAT), Chandigarh Bench`B', Chandigarh passed in I.T.A. No. 601/Chandi/2006 for the Assessment Year 2004-05, proposing to raise following substantial

questions of law :-

"(a) Whether in the facts and circumstances of the case, the Hon'ble Income Tax Appellate Tribunal was right in holding that the interest income derived by the assessee on bank deposits earned by the assessee are exempt under section 11(1) (a) whereas there is no material evidence on record that there was a `legal obligation' within the meaning of the explanation to section 13(1) of the Income Tax Act, 1961.

(b) Whether in the facts and circumstances of the case, the Hon'ble Income Tax Appellate Tribunal was right in holding that the interest on bank deposits is exempt under section 12(1) even though these are not voluntary contributions, as required under section 12(1) of the Income Tax Act, 1961."

2. The assessee is a registered society and is also registered under Section 12A of the Act. The Assessing Officer sought to tax interest income received by the assessee from the deposit in the bank. On appeal, the plea of the assessee that the income was exempt under Section 11 of the Act was upheld. The said view has been further affirmed by the Tribunal.

3. We have heard learned counsel for the parties and perused the record.

4. It is not disputed that the interest has been earned on a deposit which is property of the assessee. Section 11 of the Act clearly exempts income derived from property of assessee wholly for charitable or religious purposes to the extent to which such income is applied for such purposes.

5. Learned counsel for the Revenue submits that the assessee is not a Trust. We cannot accept the submission in view of explanation to Section 13(1) of the Act, which defines the term 'Trust', inter alia for purposes of Section 11, to include any other legal obligation.

6. It was also submitted that the income was not from voluntary contributions under Section 12(1) of the Act. This question does not arise as the assessee does not seek to be exempted on account of contributions but on account of the interest income from property under Section 11(1)(a) of the Act. Accordingly, we are unable to find any substantial question of law.

7. The appeal is dismissed.

 

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