We (Nettur technical training foundation) is a registered not for profit organisation registered with Income tax commissioners and covered under section 11 and 12 of the IT act.
With respect to our assessment we have different views taken by different assessing officers.
As per the act we presume that 85% of the gross receipts should be spent on capital and revenue expenses to avail full exemption in a financial year.
- For one year both capital and revenue expenditure and depreciation was allowed for arrive at 85%.
- Next year depreciation was disallowed ( a clarity on this was given in the finance act 2014 , stating depreciation will not be allowed)
- In the next year the gross receipt was clarified as cash basis and not on mercantile basis.
- Now we get an assessment order stating that the 85% should be on net profit before depreciation and not on gross receipt ( reason stated by the assessing officer is that there is a departmental circular to this effect)
The subject is rather leading to confusion year after year.
Kindly give your opinion and views.