Tally for Practicing CAs Gold Edition (Multi User) Tally for CAs in Industry Silver Edition (Single User) Tally Renewal (Auditor Edition) Need Tally for Clients? (Tie-up with us!!!)
News shortcuts: From the Courts | Top Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | Professional Updates | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax | PPE Safety Kit SITRA Approved | PPE Safety Kit
From the Courts »
 National Co-operative Development Corporation vs. CIT (Supreme Court)
 The ACIT, Central Circle 20, Room No.108, ARA Centre, E 2, Jhandewalan Extn., New Delhi. Vs. M/s. Sidhavandan Enterprises Pvt. Ltd., C 1/35, Safdarjung Development Area, New Delhi 110 016.
 Ganapati Breweries Ltd., UG-03, An Sal Majestic Tower, Plot No.17, G Block, Commercial Complex, Vikas Puri, New Delhi-110018 Vs. ITO, Ward-12(1), New Delhi
 Mitsui & Co. Ltd. Plot No. D1, 4th Floor, Selcon Ras Vilas, District Centre, Saket, New Delhi vs. DDIT (International Taxation) Circle-3(1) New Delhi.
 Sh. Alok Swarup, C/o-M/s Malik & Co.(Adv.) 305/7, Thapar Nagar, Meerut City, Vs. Income Tax Officer, Ward-1(2), Aayakar Bhawan, Meerut Road, Muzaffarnagar
 Shri Sanjay Sharma 418, Imperial Block, Supertech Estate Sector 9, Vaishali, Ghaziabad Vs. The A.C.I.T Circle 59(1) New Delhi.
 Nawal Kishore Soni vs. ACIT
 PCIT vs. Gulbrandsen Chemicals Pvt. Ltd.
 Delhi HC dismisses RSSB chief Gurinder Singh Dhillon's application seeking not to put ITR on record
 The Dy. CIT, Circle 11(1), Room No.405, C.R. Building, New Delhi. Vs. M/s. Ebony Retail Holdings Ltd., F-2/1, Khanpur Extension, New Delhi
 M/s PAD COM LLP C/o. R.B.Arora & Co., DSM- 127, DLF Towers, ShivajiMarg, Moti Nagar, New Delhi Vs. ACIT Circle-36(1) New Delhi

Balgopal Trust vs. ACIT (ITAT Mumbai)
May, 29th 2017

S. 54F: U/s 161, a trust which is for the sole benefit of an individual, has to be assessed as an “individual” and not as an “AOP”. Consequently, a trust is eligible for s. 54F deduction

(i) The issue is as to whether the assessee trust, which is for the sole benefit of an individual, will be entitled to deduction u/s. 54F or not, when its status is that of A.O.P. As per Section 54F the benefits of this section is available to individual or Hindu undivided family (HUF). Hon’ble jurisdictional High Court in the case of Mrs. Amy F. Cama vs. CIT 237 ITR 82 has elaborately considered the same issue. The jurisdictional High Court was dealing with assessee trust’s claim for deduction for purchase price of the flat from capital gain as per Section 54 of the Act. The Hon’ble jurisdictional High Court has held that the assessee trust was entitled for the same. The Hon’ble Court had expounded that Section 161 of the I.T Act, 1961, makes a representative assessee subject to the same duties, responsibilities and liabilities as if the income was received by him beneficially. The fiction is created as it was never the object or intention of the Act to charge tax upon persons other than the beneficial owner of the income. Whatever benefits the beneficiary will get in the said assessment must be made available to the trustee while assessing him under section 161.

(ii) The decision of Hon’ble High Court squarely applies on the present case, when we are concerned with the issue of exemption/deduction u/s. 54F. Section 54 is also applicable to individuals and HUF. However Hon’ble jurisdictional High court had expounded that on per the mandate of Section 161, the I.T. Act doesn’t intend to charge tax upon persons other than the beneficial owner of the income. Whatever benefits the beneficiary will get in a particular assessment must be made available to the trustee while assessing him u/s. 161. In the present case before us also the issue is benefit of investment made in purchase of flat for deduction u/s. 54F of the Act by the trustees and the sole beneficiary of the trust is the individual Ms. Vidushi Somani. Hence the ratio emanating from the above jurisdictional High court decision is squarely applicable on the facts of the case. The distinction referred by the Ld. D.R is devoid of cogency. Furthermore, Hon’ble Gujarat High court in the case of Niti Trust And Ors. vs. CIT 221 ITR 435 has similarly granted benefit of assessment of a trust in the capacity of a individual. For this proposition Hon’ble High Court had relied upon the decision of Hon’ble Gujarat High Court in the case of CIT vs. Deepak Family Trust to 211 ITR 575 and Calcutta High Court decision in the case of CIT vs. Shri Krishna Bandar Trust 201 ITR 989.

(iii) From the above case laws it is amply clear that by virtue of Section 161 of the I.T. Act the representative assessee is subject to the same duties, responsibilities and liabilities as if the income was received by him beneficiary, and whatever benefits the beneficiary will get in the said assessment must be made available to the trustee while assessing him u/s. 161. It is clear that it is only by virtue of u/s. 161 that the trust has been assessed for the income that is for benefit of sole beneficiary. According respectfully following the precedent we hold that the assessee is principally entitled to deduction u/s. 54F and it cannot be said that since it is a AOP and not a individual or HUF the said exemption/deduction should be denied.

Home | About Us | Terms and Conditions | Contact Us | PPE Kit SITRA Approved | PPE Safety Kit
Copyright 2020 CAinINDIA All Right Reserved.
Designed and Developed by Ritz Consulting