In order to invoke provisions of section 13(2)(c), it is essential to prove that amount paid to person referred to in sub-section (3) of section 13 is in excess of what may be reasonably paid for services rendered

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In order to invoke provisions of section 13(2)(c), it is essential to prove that amount paid to person referred to in sub-section (3) of section 13 is in excess of what may be reasonably paid for services rendered 

[2019] 101 taxmann.com 52 (Bombay) ,Commissioner of Income-tax, (Exemption) Pune v. Sri Balaji Society* AKIL KURESHI AND M.S. SANKLECHA, JJ. IT APPEAL NOS. 762 & 782 OF 2016† DECEMBER  11, 2018 .
 
FACTS OF CASE
 
The Assessing Officer noticed that said SBC was a partnership firm consisting of three partners who happened to be trustees of the assessee-trust. 
 
The Assessing Officer opined that the firm i.e., SBC was a firm covered under section 13(3)(e) vis-a-vis trust. 
 
The Assessing Officer thereafter carried out the analysis of the expenditure in connection with the advertisements with a special focus on the payments made to the SBC. He thus denied the benefit under section 11 relying upon the provisions of section 13(2)(c).  
 
JUDGEMENT
 
Clause (c) of sub-section (2) of section 13 can be invoked, if any amount is paid by way of salary, allowance or otherwise to any person referred to in sub-section (3) out of resources of the trust for services rendered to the trust and the amount so paid is in excess of what may be reasonably paid for such services. 
 
Thus, essential requirement for invoking the said provision is that the amount paid was in excess of what may be reasonably paid for the services. 
 
In the present case, the Commissioner (Appeals) and the Tribunal had elaborately examined the accounts of the assessee, the payments made to the SBC, the payments made to other agencies for similar work, comparative rates of payments and came to the conclusion that no excess payment was made to the related person.
 
 Essentially, this is a pure question of fact. 
 
No question of law arises.
 [Para 5]
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