22 September 2008
A charitable trust,registered under the income tax act,1961 having main object of promoting education gave an amount of Rs.75000/- during the financial year 2007-08 as an interest free loan to a needy student for undergoing higher education. Whether this amount can be treated as an application of the income of the trust u/s 11.
22 September 2008
Yes, if advancement of education and granting of scholarship loans is one of the activities carried on for the fulfilment of the objectives of the trust, granting of loans, even if interest bearing, will amount to the application of income for charitable purposes.
CAclubindia
