This appeal, filed by assessee, is directed against order of CIT(A), Bareilly dt. 30th March, 2006 relating to asst. yr. 2003-04. In this appeal, assessee has taken following grounds: "I. learned Commissioner of Income-tax (Appeals), Bareilly [hereinafter referred to as learned CIT(A)] erred on facts and in law in confirming action of AO in not allowing appellant exemption of its income under s. 11(1)(a) of Act and taxing income at Rs. 20,97,720 instead of nil disclosed by rejecting appellant s claim of accumulation of income under s. 11(2) of Act made through. II. On facts and in peculiar circumstances of present case specially keeping in view written submission, learned CIT(A) was not at all justified in rejecting claim of appellant of accumulation of surplus under s. 11(2) as stated in Form No. 10 filed along with return and/or as filed in course of assessment proceedings, only for reason that inadvertently appellant instead of stating that income is being accumulated for period five years which stood stated ten years, and so order of CIT(A) be set aside and appellant allowed benefit of accumulation as claimed. Without prejudice to ground Nos. I and II taken above. III. In disallowing appellant its claim of accumulation under s. 11(2) and exemption of its income under s. 11(1) of Act, learned CIT(A) failed to appreciate or chose to completely ignore fact that appellant had filed corrected Form No. 10 in course of assessment and so applying ratio of apex Court judgment in case of Nagpur Hotel Association s case and also jurisdictional High Court judgment, ought to have reversed order of AO and allowed appellant benefit of accumulation of its income consequently assessing income of appellant at nil." Briefly stated, facts of case are that assessee is educational society, formed on 22nd Feb., 2000 with main object of establishing educational institutions for imparting education to students. For assessment year under consideration, assessee filed its return of income declaring nil income on 1st Dec., 2003. During assessment year under consideration, assessee collected funds to tune of Rs. 32,96,043 and utilised Rs. 7,03,915 for educational activities of children. assessee claimed deduction of total income under s. 11 of IT Act, 1961. assessee is charitable society, registered under provisions of UP Society Registration Act, 1860 w.e.f. 22nd Feb., 2000. society was registered under s. 12A. One of objects of society is to manage and organise education for physical, mental, social and moral development and overall development of students. During assessment year under consideration, assessee society has received following funds: Interest Rs. 2,88,987 Donation Rs. 29,82,756 Tuition fee Rs. 24,300 Rs. 32,96,043 After application of funds to charitable purposes, assessee has shown surplus of Rs. 25,92,128 out of which Rs. 4,92,128 treating 15 per cent of total receipts of Rs. 32,96,043 has been added to surplus fund in view of provision of s. 11(1) and Rs. 21,00,000 (Rs. 20,97,720 as per AO) has been claimed as set apart in view of provision of s. 11(2) of Act. AO noted that notice has been given for setting apart Rs. 21,00,000 for period of 10 years upto 31st March, 2013 for carrying out construction of school building. According to AO, as per provisions of second proviso to sub-s. (2) of s. 11, fund is to be set apart for specific charitable purpose only for five years, if it is set apart on or after 1st April, 2001. AO also observed that copy of resolution passed by society on 24th June, 2003 was furnished along with return wherein it was deliberately resolved that out of surplus fund of Rs. 25,92,128, amount of Rs. 21,00,000 be accumulated for 10 years till 31st March, 2013 for construction of school building. AO vide letter dt. 5th Jan., 2006 asked assessee to justify its 100 per cent deduction in view of provisions of ss. 11(1), 11(2) and Form No. 10. In response to this letter, assessee, vide reply dt. 16th Jan., 2006, submitted that Rs. 21,00,000 was accumulated for specific purpose to be utilised for attainment of object of society and investment in FDR was made according to s. 11(5) of IT Act, 1961. assessee also submitted that Form No. 10 was also filed well within time. AO observed that society has set apart Rs. 21,00,000 for 10 years in place of five years provided in Act. assessee was again required to submit explanation in light of provision of Act. In this regard, assessee submitted that due to technical mistake, ten years period for application of accumulated fund was passed in meeting held on 24th June, 2003 instead of five years as allowed by IT Act. assessee also assured AO that Rs. 21,00,000 will be applied for construction of school building before expiry of five years i.e. 31st March, 2008. assessee also furnished copy of resolution of meeting held on 17th Jan., 2006 wherein it was resolved that accumulated fund will be applied within five years instead of ten years. AO did not accept above explanation of assessee stating that period of ten years has been deliberately decided by assessee through resolution passed on 24th June, 2003. According to AO, new resolution passed by assessee trust on 17th Jan., 2006 was of no help to assessee. He further observed that revised resolution was not passed within expiry of time allowed under s. 139(1) for furnishing return of income. AO also opined that new resolution dt. 17th Jan., 2006 was irrelevant as far as determination of taxable total income is concerned. AO concluded that assessee has not followed and complied with provisions of s. 11(2), hence claim of exemption of excess income claimed to have been set apart vide Form No. 10 is not allowed. Aggrieved by order of AO, assessee carried matter in appeal before CIT(A). learned CIT(A) upheld order of AO stating that law as it stands requires that this amount can be set apart to for period of five years and if it is not utilised within five years, it is taxable. He further observed that law also requires intimation to assessing authority by filing Form No. 10. learned CIT(A) admitted that in instant case Form No. 10 has been filed by assessee, but accumulation has been shown for period of ten years. learned CIT(A) concluded that assessee has not complied with provisions of s. 11 of Act. We have heard rival submissions and have also carefully gone through We have heard rival submissions and have also carefully gone through materials available on record. Sec. 11(2) of IT Act, 1961 provides that in case of accumulation of funds, assessee has to specify in prescribed Form No. 10, period for which accumulation shall be made. It is relevant to state that period for accumulation of income before 1st April, 2001 was ten years and period of ten years has been revised by five years after 1st April, 2001. Shri Kanchan Kaushal, learned counsel for assessee submitted that by oversight, assessee society resolved that accumulation of income shall not exceed ten years instead of five years. In our view, lower authorities have failed to appreciate that period of ten years was mentioned in Form No. 10 inadvertently, which was duly rectified by resolution passed on 17th Jan., 2006. period of five years, as amended w.e.f. 1st April, 2001, had still not expired upto 31st March, 2008, and society duly passed another resolution on 17th Jan., 2006 committing to utilise accumulated income within amended period of five years for construction of building. In fact, both resolutions dt. 24th June, 2003 and 17th Jan., 2006 were before AO. It is admitted fact that both resolutions were filed before AO well before completion of assessment. learned CIT(A) has observed that charitable society registered under s. 12A has to comply with three broad parameters, namely (a) it should apply its total income towards charitable purpose; (b) it can accumulate upto 15 per cent of receipts to be applied later on for some charitable purpose; and, (c) it can set apart proportion of income for specific purpose. According to learned CIT(A), assessee has fulfilled condition Nos. (a) and (b) supra. As regards third condition, learned CIT(A) observed that this amount can be set apart to for period of five years; after it is not utilised within five years, it is taxable. To set it aside for five years, law further requires intimation to AO by filing of Form No. 10. There is no dispute that assessee had filed Form No. 10 well before completion of assessment. It is seen that claim of assessee has been disallowed on ground that in Form No. 10, period was mentioned ten years instead of period of five years as per mandatory provisions. In our view, this is technical mistake which has been rectified by another resolution dt. 17th Jan., 2006 resolving that assessee society will utilise accumulated funds within period of five years which lapses on 31st March, 2008. contention of Department is that assessee failed to submit any other notice in Form No. 10 before expiry of time allowed under s. 139(1) of Act. It is also submitted by learned Departmental Representative that there was no explanation on side of assessee that any other Form No. 10 was filed after original Form No. 10 filed on 1st Dec., 2003 and was duly condoned by CIT(A) in view of Circular No. 273, dt. 3rd June, 1980. In our view, there is no merit in above contentions of Department. While holding so, we are fortified by decision of Tribunal, Ahmedabad "A" Bench in case of Stock Exchange, Ahmedabad vs. Asstt. CIT (2000) 68 TTJ (Ahd) 610. relevant findings of Tribunal (at p. 615) are as under: " ..The provisions of s. 11(2) do not prescribe any time limit by which such notice in writing should be given by trust nor it prescribes any time limit by which money so accumulated or set apart should be invested or deposited in prescribed modes. In r. 17 of IT Rules it is provided that notice under s. 11(2) shall be in Form No. 10 and same shall be filed before AO within time specified under sub-s. (1) of s. 139 for furnishing return of income. It has been held by various High Courts that since in statute itself there is no prescribed time limit for furnishing prescribed Form No. 10 or for making investment in prescribed securities, time limits laid down under rules are ultra vires Act. In any case such time limits are to be treated as directory in nature." From above observations of Tribunal, it is clear that provisions of s. 11(2) of IT Act do not prescribe any time limit by which notice in writing should be given by trust nor it prescribes any time limit by which money accumulated or set apart should be invested or deposited in prescribed modes. Tribunal further held that time limits laid down in rules are directory in nature. Respectfully following decision of Tribunal, Ahmedabad Bench (supra), we hold that Departmental authorities were not justified in rejecting claim of assessee. In our view, assessee has complied with provisions of s. 11(2) by filing Form No. 10 before completion of assessment by AO. Furthermore, period of ten years was mentioned in Form No. 10 inadvertently which was rectified by resolution passed on 17th Jan., 2006 before completion of assessment. In view of above, we set aside order of CIT(A) and direct AO to allow benefit of accumulation as claimed. In result, appeal is allowed. *** SHRI PREMNARAIN MEMORIAL EDUCATIONAL & CHARITABLE SOCIETY v. ASSISTANT COMMISSIONER OF INCOME TAX