Carried forward loss-Charitable Trust

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Meghana (Querist)
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10 June 2008 During the previous year relevant to assessment year 2008-09, the trust has surplus income after claiming all the amount spent on the objects of the trust and for the purpose of trust after availing the 15 % deduction.

But in the earlier years, the trust had over spent the amount than the income.This had resulted into a negative income. The returns were filed in time for all the earlier years but without claiming the carried forward over spent amount as carried loss to be adjusted aginst the future income.

Can Trust set off earlier years overspent amount as loss from the current year surplus?

Is there any case law to support this?

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Meghana

Meghana (Querist)
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10 June 2008 1

CA. PIYUSH GOEL

CA. PIYUSH GOEL (Expert)
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01 April 2013 dear meghana..

in my opinion trust cannot claim carry forward of losses..

because carry forward of loss is allowed under head income from house property, capital gain , business or profession, other sources only in the case of loss owing & maintaining race horses.

since trust cannot say that it is carrying on business activity therefore its loss cannot be carry forward under head business & profession.

then its neither house property income nor capital gain.

last option remains is income under head other sources and under that except loss from owing & maintaining race horses nothing is carry forward..

therefore, in my opinion loss sustained by the trust cannot be carry forward.

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