The AO held that rent charged from one of the Trustee\u00a0 is less than the market rent and rent charged from other tenants in the same premises .\u00a0 The AO denied the exemption u\/s 11 \u00a0on entire income of the Trust\u00a0 on the ground that the assessee has violated the provision of the section 13(1)(c)(ii) of the Act . CIT(A) affirmed the order of the AO. On appeal the Tribunal held that exemption u\/s 11 cannot be denied for violation of section 13 of the\u00a0 Act and the disallowance\u00a0 should be restricted to the extent of violation of provisions of section 13(1)(c)(ii) and 13(b) of the Act and the matter was remanded for verification .<\/p>\n
On appeal by the Revenue \u00a0\u00a0the question raised before\u00a0 the High Court\u00a0 is \u201c Whether on the facts and circumstances of the case and in law the Honourable ITAT is right in holding that the violation of section 13(1)( c) (ii) does not lead to denial of exemption u\/s 11 as against the principle laid down by the Hon\u2019ble Apex Court in the case of DIT v. Bharat Diamond Bourse dt . 1 December 2002 ( 2003) 179 CTR 225 ?\u201d<\/p>\n
Following the judgement in CIT( E) v. Audyogik\u00a0 Shikhan Mndal ( 2019) 101 taxmann. \u00a0com\u00a0 247\/ 261 Taxman 12 \u00a0( Bom)( HC ), the\u00a0 question of law raised by the\u00a0 Revenue was dismissed . Order of Tribunal is affirmed . \u00a0\u00a0\u00a0\u00a0( ITA .No\u00a0 683 of 2018 dt 5 -8 -2022) ( AY. 2010 -11) \u00a0( ITA No. 223\/Pun\/ 2014 dt 28 -6 -2017<\/a> )<\/p>\n","protected":false},"excerpt":{"rendered":" S. 13 : Denial of exemption-Trust or institution-Investment restrictions \u2013Rent charged to trustee less than market rate – Violation of section 13 exemption cannot be denied- Only the income to the extent of violation is liable to tax at maximum marginal rate .[ S. 11, 12 ,12A, 13(1)(c)(ii)] <\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21],"tags":[],"class_list":["post-29895","post","type-post","status-publish","format-standard","hentry","category-income-tax-act"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-7Mb","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/29895","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=29895"}],"version-history":[{"count":4,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/29895\/revisions"}],"predecessor-version":[{"id":29902,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/29895\/revisions\/29902"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=29895"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=29895"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=29895"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}