Income by way of Statutory Contribution received from recognized Stock Exchange  is eligible for exemption u/s  10 (23EC) of Income Tax Act: ITAT [Read Order]

The Income Tax Appellate Tribunal (ITAT ) Mumbai bench held that income by way of statutory contribution received from the recognized stock exchange is eligible for exemption under Section 10 (23EC) of the Income Tax Act, 1961.

Assesee,  NCDEX Investor (Client) Protection Fund Trust has been established by National Commodity & Derivatives Exchange Limited (NCDEX) by trust deed in terms of guidelines issued by the Forward Markets Commission (FMC) with an object of compensating eligible claims of investors against defaulting members.

It has the objective also of creating awareness and educating the public about the benefits of trading on commodity exchange and to publish books etc for the same objective.

While filing return of income, the assessee claimed exemption under section 10 (23EC) of the Income Tax act on account of the contribution received of ₹ 92,458,751/–.

During the assessment proceedings, the Centralized processing Centre of Income Tax did not grant exemption under section 10 (23EC) of the act.

Aggrieved by the order assesee filed appeal before CIT(A), who allowed the appeal.Against the order revenue filed appeal before the tribunal .

On behalf of the assessee,  K.K . Ved , counsel argued that the assessee is entitled to exemption under section 10 (23EC) of the Income Tax Act  on the income of contribution received from recognized stock exchanges and the members.

Further submitted that in the several years, the learned assessing officer has granted exemption to the assessee under section 10 (23EC) of the Income Tax Act.

Ashok Kumar Ambastha, Counsel for Revenue supported the decision of the assessing officer.

After considering  the facts submitted and circumstance , the two member bench of  Prashant Maharishi (Accountant Member ) and  Rahul Chaudhary,(Judicial Member) observed that income of the assessee with respect to contribution received from recognized stock exchange and the members thereof is eligible for exemption under section 10 (23EC) of the Income Tax Act.

To Read the full text of the Order CLICK HERE

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