R. Sudhakar, J. - (1.)The appellant assessee Trust was formed by Smt. Urmila Sathyanarayanan for promoting Bharatanatyam and other forms of Indian Classical Dance. The other Trustee of the Assessee Trust is Sri.A.D. Sathyanarayanan, husband of Smt. Urmila Sathyanarayanan. The land in question belong to Sri.A.D. Sathyanarayanan as an individual and in order to extend his goodwill for the benefit of his wife's endeavour to promote the classical dance, he permitted the Trust to construct a building by utilising the funds of the Trust for the purpose of promoting Bharatanatiyam and other Indian Classical dances.
(2.)The assessee trust is registered under Sec. 12AA of the Income Tax Act, 1961, (hereinafter referred to as the Act) on 23.12.1997. The Assessing Officer, while completing the assessment in the year 2009 -2010, denied exemption under Sec. 11 of the Act, as claimed by the assessee, stating that the income of the assessee Trust fell within the ambit of amended provisions of Sec. 2(15) of the Act and that the assessee trust has violated the provisions of Sec. 13(1)(c) of the Act. On a challenge made to the assessing order, the Commissioner allowed the appeal in favour of the Trust. The Tribunal reversed the said finding. Hence, the present appeal by the assessee.
(3.)The finding of the Tribunal is that,
" 6........... Even though the trust is not paying any rent or compensation to the trustee for the land used by the assessee trust which was belonging to one of the trustees, since the assessee trust is using its income for construction of the building on the land belonging to one of the trustees amount to applying the income of the trust for the benefit of the trustee which is certainly falls under Sec. 13(1)(c) of the Act. The trustee is certainly the beneficiary as on the date of construction of the building. As long as the trustee is holding the property and the trust is using the said property by putting up building /structure for conducting dance classes, trustee is enjoying the benefit indirectly though not directly. Therefore, benefit to the trustee cannot be completely ruled out."