Rebutting of Sec. 11 exemptions opens an alternate route for sec. 80-IB deduction for eligible projects

	Rebutting of Sec. 11 exemptions opens an alternate route for sec. 80-IB deduction for eligible projects
	The assessee-trust was engaged in the development of a housing project. Since, the development of housing project could not be regarded as charitable purpose by virtue of the first proviso to Section 2(15) of the Act, it claimed deduction under section 80-IB(10). The assessing officer rejected the claim, and held that as the income was derived from property held under trust, no deduction could be allowed to the trust under Sec. 80-IB On appeal, the Tribunal held that by virtue of section 13(8) the income from developing housing project would become part of the total income under the Act. In the light of this amendment, application of the income for charitable purpose becomes irrelevant. In other words, the income derived from business cannot be considered as income derived from property held for charitable purpose and it would no longer be income within the meaning of section 11(1)(a) of the Act. Therefore, assessee's income has to be computed in accordance with the provisions of the Act and would be entitled to deduction under section 80-IB(10) of the Act - INDIA HERITAGE FOUNDATION v. DDIT(E) [2012] 23 taxmann.com 172 (Bangalore - Trib.) (View full judgment)