INCOME TAX

Applicability of section 13(1)(d) of the Income-tax Act, 1961, for assessment year 1983-84--Clarification regarding

Circular No. 596

Dated 15/3/1991

Clause (d) of sub-section (1) of section 13 of the Income- tax Act was substituted by the Finance Act, 1983, with effect from 1-4-1983. The provisions of the new sub-clause were to be applicable from the assessment year 1983-84 onwards. This was also clarified in paragraph 18.7 of Board's Circular No.372 dated 8-12-1983 [F.No.131/(27)/83-

TPL] (See [1984] 146 ITR (St.) 9). However, under sub-clause (ii) of the said section, religious/charitable trusts and institutions having investments otherwise than in one or more of the forms or modes specified in section 11(5) of the Act, which had been made before 1st March, 1983, were allowed to change their pattern of investment to that specified in section 11(5) before the 30th November, 1983. Many trusts and institutions, which changed their investment pattern between 1-4-1983 and 30-11-1983, were denied the benefit of exemption for the assessment year 1983-84 in view of the provisions of section 13(1)(d).

2. The issue has been considered in the Board and it is decided that the provisions of section 13(1)(d) would be applicable from the assessment year 1984-85 and not from the assessment year 1983-84. It is also decided that appellate decisions on this issue, hitherto in favour of the assessee, may not be further contested, and pending appeals/references may be withdrawn by the Chief Commissioners of Income-tax, in exercise of the powers delegated to them.

(Sd.) Dalip Singh,

Officer on special duty.