Only Income From Investment Made By Charitable Institution In Violation Of S.13(1)(d) Income Tax Act Is Liable To Tax: Telangana HC

The Telangana High Court ruled that income derived from investments by a charitable institution, in violation of Section 13(1)(d) of the Income Tax Act, is taxable. The dispute arose when the institution invested in modes prohibited under the Act, leading the tax department to classify the income as taxable. The court upheld the department’s stance, stating that non-compliance with statutory provisions disqualifies the organization from tax exemptions. This judgment underscores the importance of adherence to regulatory norms for retaining charitable status.