Caselaws for non consideration of exemption u/s 11
This query is : Resolved
05 July 2025
caselaws for non consideration of exemption u/s 11
12 August 2025
1. CIT vs. Andhra Chamber of Commerce (1965) 56 ITR 745 (SC)
Held that exemption under Section 11 is available only when income is actually applied for charitable purposes during the relevant previous year.
Mere setting aside or transfer to a reserve fund does not qualify unless it is specifically permitted and used for charitable purposes.
2. CIT vs. Bharat Gyan Vigyan Samiti (2000) 243 ITR 242 (SC)
Clarified that the exemption under Section 11 will be denied if the income is not applied or accumulated for charitable purposes.
Accumulation must be within the prescribed period under Section 11(2).
3. CIT vs. St. John Ambulance Association (1967) 66 ITR 286 (SC)
It was held that exemption under Section 11 is subject to the condition that the income should be applied for charitable or religious purposes in India.
If income is diverted or not used as per the objects of the trust, exemption can be denied.
4. CIT vs. Jawaharlal Nehru Memorial Fund (1967) 66 ITR 1 (SC)
Exemption under Section 11 depends on application of income and not merely on the object of the trust or corpus.
The trustees’ discretion to accumulate income does not automatically lead to exemption unless it meets conditions of the section.
5. CIT vs. Osmania University (1997) 227 ITR 868 (AP HC)
Held that if the trust does not apply the income for charitable purposes or applies it for non-charitable purposes, exemption under Section 11 will be denied.
6. CIT vs. Calcutta Jain Temple (1962) 46 ITR 254 (SC)
Exemption under Section 11 is denied if the income is utilized for purposes outside charitable objects.
Summary:
Section 11 exemption is linked to actual application or accumulation of income for charitable/religious purposes within prescribed time limits.
Non-application, diversion, or application to non-charitable purposes results in denial of exemption.
Mere existence of charitable objects or setting aside funds does not guarantee exemption.
Held that exemption under Section 11 is available only when income is actually applied for charitable purposes during the relevant previous year.
Mere setting aside or transfer to a reserve fund does not qualify unless it is specifically permitted and used for charitable purposes.
2. CIT vs. Bharat Gyan Vigyan Samiti (2000) 243 ITR 242 (SC)
Clarified that the exemption under Section 11 will be denied if the income is not applied or accumulated for charitable purposes.
Accumulation must be within the prescribed period under Section 11(2).
3. CIT vs. St. John Ambulance Association (1967) 66 ITR 286 (SC)
It was held that exemption under Section 11 is subject to the condition that the income should be applied for charitable or religious purposes in India.
If income is diverted or not used as per the objects of the trust, exemption can be denied.
4. CIT vs. Jawaharlal Nehru Memorial Fund (1967) 66 ITR 1 (SC)
Exemption under Section 11 depends on application of income and not merely on the object of the trust or corpus.
The trustees’ discretion to accumulate income does not automatically lead to exemption unless it meets conditions of the section.
5. CIT vs. Osmania University (1997) 227 ITR 868 (AP HC)
Held that if the trust does not apply the income for charitable purposes or applies it for non-charitable purposes, exemption under Section 11 will be denied.
6. CIT vs. Calcutta Jain Temple (1962) 46 ITR 254 (SC)
Exemption under Section 11 is denied if the income is utilized for purposes outside charitable objects.
Summary:
Section 11 exemption is linked to actual application or accumulation of income for charitable/religious purposes within prescribed time limits.
Non-application, diversion, or application to non-charitable purposes results in denial of exemption.
Mere existence of charitable objects or setting aside funds does not guarantee exemption.
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