Tata education trusts charity in US not income: ITAT - Times of India

Описание: Read full article here: https://readnews.io/0h1vtf



(Representative image)MUMBAI: Tata Education and Development Trust (TEDT), set up by Ratan Tata in 2008, has obtained a favourable order from the Income Tax Appellate Tribunal (ITAT - Mumbai bench). Donations made by the trust outside India to US-based universities Cornell and Harvard will be treated as an application of income by the trust. Thus, donations of nearly Rs 198 crore and over Rs 25 crore made to these US universities during the financial years 2010-11 and 2011-12 will not be treated as the income of the trust. The ITAT overturned the additions of these sums to the trusts income, that were made by the commissioner of income tax (appeals). TEDTs charitable objective was to invest in projects in India or overseas that promote the development of knowledge and expertise in several areas vital for Indias growth and competitive abilities. At Cornell, TEDT established an endowment fund through contributions totalling $50 million to enable generations of Indian undergraduate students to access educational opportunities. A donation of a likewise sum to Harvard was for construction of the Tata Hall, which would provide classroom and residential facilities within the campus for its executive education programme participants. This would also provide tremendous global visibility for India and Indian business. Section 11(1)(C) of the I-T Act states that income derived from property held under a trust created after April 1, 1952, for charitable purpose, which tends to promote international welfare in which India is interested shall be exempt to the extent to which such income is applied for this purpose outside India. However, for such exemption, an approval of the Central Board of Direct Taxes (CBDT) is required. In this case, at the time of assessment, the CBDTs approval was not on the table and, accordingly, the I-T officer added these sums to the trusts income. However, while the approval was pending before the appellate