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Whether Section 2(15) of the Income-tax Act, 1961 would be attracted to the assessee case where the earned income from letting out of Kalyana Mandapam, Gnanavapi utilizes the entire revenue derived there from towards charitable objects such as Education and Medical relief to the poor?

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Section 2(1%), 11, 12AA of the Income Tax Act, 1961- Trust - Registration of trust - Matter remitted back to AO for de novo consideration as both CIT (Appeals) and ITAT have not discussed about the facts in respect of the surplus income having been utilized for the objects of the trust.

Facts: Whether Section 2(15) would be attracted to the assessee case where the earned income from letting out of Kalyana Mandapam, Gnanavapi utilizes the entire revenue derived there from towards charitable objects such as Education and Medical relief to the poor? and Would the activity of letting out Kalyana Mandapam not be incidental to the attainment of the objectives of the trust thereby entitling the assessee to the exemption under section 12AA by virtue of the exemption carved out under section 11(4A)?"

Held, that both CIT (Appeals) and ITAT have not discussed about the facts in respect of the surplus income having been utilized for the objects of the trust viz., Running educational institution, providing medical relief to the poor etc., Absolutely there is no discussion of the facts relating to the utilization of earned income from letting out of Kalyana Mandapam and Gnanavapi towards charitable objects such as Education and Medical relief to the poor as given in the objects of the trust. Further, AO has not looked into the fact as to whether the entire income from Community Hall, Kalyana Mandapam and Gnanavapi are utilised for fulfilling the objects of the trust that is being education Medical relief and relief to the poor. In such circumstances, the order dated 6-4-2016 passed by the Income-tax Appellate Tribunal, Chennai 'D' Bench in ITA.Nos.665 and 664/Mds/2015 for the Assessment year 2010-11 and 2011-12 is set aside. The Assessing Officer shall consider the above said questions and decide the matter on merits. With the above observation, the Tax Case Appeals stand allowed and the order passed by the Income-tax Appellate Tribunal, Chennai 'D' Bench, in ITA.Nos.665 & 664/Mds/2015 for the Assessment Year 2010-11 and 2011-12, dated 6-4-2016, is set aside and the matter is remitted back to AO for de novo consideration. The substantial questions of law are left open to be decided by the Assessing Officer by considering the issue afresh. - SRI RAM SAMAJ V/s JT, DIT - [2020] 29 ITCD Online 007 (MAD)