Law:

Section:

Section 11 of the Income-tax Act, 1961 (Corresponding to Section 4(3)(i) of the Indian Income-tax Act, 1922) - Charitable or religious trust - Exemption of income from property held under - Assessment years 1954-55, 1955-56, 1957-58 to 1959-60 - Assessee constructed an overbridge - By an agreement Bombay Municipal Corporation (BMC) granted permanent lease of spaces on either side of bridge to assessee to be used for advertisements and income therefrom had to be used for any charitable purpose mutually agreed upon - As per terms of revised agreement trustees were to be appointed and authorised to let out space for advertisements and also to settle all matters - Revenue realised was to be credited to a fund and utilised solely for providing works of public amenities - Assessee kept a separate account for net income from advertisements and this amount was accumulated - Whether term 'property' being a term of widest import, signifies every possible interest which a person can acquire, hold and enjoy - Held yes - Whether, therefore right to exploit space on either side of bridge for advertisement was property which could be held under trust or legal property which could be held under trust or legal obligation for providing works of public amenities - Held, yes - Whether, since, income derived from advertisement was kept in a separate account and utilised only for providing works of public amenities, trust created by assessee satisfied all conditions necessary for claiming exemption under section 4(3)(i) of 1922 Act, and consequently, income in question was to be exempted from tax - Held, yes Words & Phrases : 'Property' interpreted. FACTS On 19-9-1951, The assessee sent a proposal to the Bombay Municipal Corporation (BMC) for construction of an over-bridge, on the condition that the amount realised by selling in advance the advertising spaces on either side both illuminated and unilluminated type, should be permitted to be taken by him. On 30-1-1952, the assessee further wrote to the BMC stating that after the bridge was constructed, he was prepared to offer the complete savings from his income towards any charitable caused which might mutually be decided upon.…

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